EXHIBIT 10.1
BANC OF AMERICA SECURITIES LLC
J.P. MORGAN SECURITIES INC.
$225,000,000 AGGREGATE PRINCIPAL AMOUNT
QUANTA SERVICES, INC.
4.50% CONVERTIBLE SUBORDINATED DEBENTURES
DUE 2023
RESALE REGISTRATION RIGHTS AGREEMENT
DATED OCTOBER 17, 2003
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RESALE REGISTRATION RIGHTS AGREEMENT, dated as of October 17, 2003,
among Quanta Services, Inc., a Delaware corporation (together with any successor
entity, herein referred to as the "COMPANY"), Banc of America Securities LLC and
J.P. Morgan Securities Inc., as representatives of the several initial
purchasers (the "INITIAL PURCHASERS") under the Purchase Agreement (as defined
below).
Pursuant to the Purchase Agreement, dated as of October 9, 2003, among
the Company, Banc of America Securities LLC and J.P. Morgan Securities Inc., as
representatives of the Initial Purchasers (the "PURCHASE AGREEMENT"), the
Initial Purchasers have agreed to purchase from the Company $225,000,000
($270,000,000 if the Initial Purchasers exercise their option in full) in
aggregate principal amount of 4.50% Convertible Subordinated Debentures due 2023
(the "DEBENTURES"). The Debentures will be convertible into fully paid,
nonassessable shares of common stock, par value $0.00001 per share, of the
Company together with the rights (the "Rights") evidenced by such Common Stock
to the extent provided in the Rights Agreement dated as of dated March 8, 2000
(and as amended prior to the date hereof) between the Company and American Stock
Transfer & Trust Company (collectively, the "COMMON Stock"). The Debentures will
be convertible on the terms, and subject to the conditions, set forth in the
Indenture (as defined herein). To induce the Initial Purchasers to purchase the
Debentures, the Company has agreed to provide the registration rights set forth
in this Agreement pursuant to Section 5(h) of the Purchase Agreement.
The parties hereby agree as follows:
1. Definitions. Capitalized terms used in this Agreement without
definition shall have their respective meanings set forth in the Purchase
Agreement. As used in this Agreement, the following capitalized terms shall have
the following meanings:
"AFFILIATE" of any specified person means any other person which,
directly or indirectly, is in control of, is controlled by, or is under common
control with, such specified person. For purposes of this definition, control of
a person means the power, direct or indirect, to direct or cause the direction
of the management and policies of such person whether by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"AGREEMENT": This Resale Registration Rights Agreement.
"BLUE SKY APPLICATION": As defined in Section 6(a)(i) hereof.
"AMENDED EFFECTIVENESS DEADLINE DATE" has the meaning set forth in
Section 2(e) hereof.
"BUSINESS DAY": The definition of "Business Day" in the Indenture.
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"COMMISSION": Securities and Exchange Commission.
"COMMON STOCK": As defined in the preamble hereto.
"COMPANY": As defined in the preamble hereto.
"DEBENTURES": As defined in the preamble hereto.
"EFFECTIVENESS PERIOD": As defined in Section 2(a)(iii) hereof.
"EFFECTIVENESS TARGET DATE": As defined in Section 2(a)(ii) hereof.
"EXCHANGE ACT": Securities Exchange Act of 1934, as amended.
"HOLDER": A Person who owns, beneficially or otherwise, Transfer
Restricted Securities.
"INDEMNIFIED HOLDER": As defined in Section 6(a) hereof.
"INDENTURE": The Indenture, dated as of October 17, 2003 between the
Company and Wells Fargo Bank, N.A., as trustee (the "Trustee"), pursuant to
which the Securities are to be issued, as such Indenture is amended, modified or
supplemented from time to time in accordance with the terms thereof.
"INITIAL PURCHASERS": As defined in the preamble hereto.
"LIQUIDATED DAMAGES": As defined in Section 3(a) hereof.
"LIQUIDATED DAMAGES PAYMENT DATE": Each April 15 and October 15.
"MAJORITY OF HOLDERS": Holders holding over 50% of the aggregate
principal amount of Debentures outstanding; provided that, for the purpose of
this definition, a holder of shares of Common Stock which constitute Transfer
Restricted Securities and issued upon conversion, redemption or repurchase of
the Debentures shall be deemed to hold an aggregate principal amount of
Debentures (in addition to the principal amount of Debentures held by such
holder) equal to the quotient of (x) the number of such shares of Common Stock
held by such holder and (y) the conversion rate in effect at the time of such
conversion, redemption or repurchase as determined in accordance with the
Indenture.
"NASD": National Association of Securities Dealers, Inc.
"NOTICE AND QUESTIONNAIRE": a written notice executed by the respective
Holder and delivered to the Company containing substantially the information
called for by the Selling Securityholder Notice and Questionnaire attached as
Annex A to the Offering Memorandum of the Company issued October 9, 2003
relating to the Debentures.
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"NOTICE HOLDER": on any date, any Holder that has delivered a Notice
and Questionnaire to the Company on or prior to such date.
"PERSON": An individual, partnership, corporation, company,
unincorporated organization, trust, joint venture or a government or agency or
political subdivision thereof.
"PURCHASE AGREEMENT": As defined in the preamble hereto.
"PROSPECTUS": The prospectus included in a Shelf Registration
Statement, as amended or supplemented by any prospectus supplement and by all
other amendments thereto, including post-effective amendments, and all material
incorporated by reference into such prospectus.
"RECORD HOLDER": With respect to any Liquidated Damages Payment Date,
each Person who is a Holder on the 15th day preceding the relevant Liquidated
Damages Payment Date. In the case of a Holder of shares of Common Stock issued
upon conversion of the Debentures, "Record Holder" shall mean each Person who is
a Holder of shares of Common Stock which constitute Transfer Restricted
Securities on the 15th day preceding the relevant Liquidated Damages Payment
Date.
"REGISTRATION DEFAULT": As defined in Section 3(a) hereof.
"SECURITIES ACT": Securities Act of 1933, as amended.
"SHELF FILING DEADLINE": As defined in Section 2(a)(i) hereof.
"SHELF REGISTRATION STATEMENT": As defined in Section 2(a)(i) hereof.
"SUBSEQUENT SHELF REGISTRATION STATEMENT" has the meaning set forth in
Section 2(c) hereof.
"SUSPENSION NOTICE": As defined in Section 4(c) hereof.
"SUSPENSION PERIOD": As defined in Section 4(b)(i) hereof.
"TIA": Trust Indenture Act of 1939, as amended, and the rules and
regulations of the Commission thereunder, in each case, as in effect on the date
the Indenture is qualified under the TIA.
"TRANSFER RESTRICTED SECURITIES": Each Debenture and each share of
Common Stock issued upon conversion, redemption or repurchase of Debentures
until the earlier of:
(i) the date on which such Debenture or such
share of Common Stock issued upon conversion, redemption or
repurchase
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has been effectively registered under the Securities Act and
disposed of in accordance with the Shelf Registration
Statement;
(ii) the date on which such Debenture or such
share of Common Stock issued upon conversion, redemption or
repurchase is transferred in compliance with Rule 144 under
the Securities Act or may be sold or transferred by a person
who is not an affiliate of the Company pursuant to Rule 144
under the Securities Act (or any other similar provision then
in force) without any volume or manner of sale restrictions
thereunder; or
(iii) the date on which such Debenture or such
share of Common Stock issued upon conversion, redemption or
repurchase ceases to be outstanding (whether as a result of
redemption, repurchase and cancellation, conversion or
otherwise).
"UNDERWRITTEN REGISTRATION": A registration in which Debentures of the
Company are sold to an underwriter for reoffering to the public.
Unless the context otherwise requires, the singular includes the
plural, and words in the plural include the singular.
2. Shelf Registration.
(a) The Company shall:
(i) not later than 90 days after the date hereof
(the "SHELF FILING DEADLINE"), cause to be filed a
registration statement pursuant to Rule 415 under the
Securities Act (the "SHELF REGISTRATION STATEMENT"), which
Shelf Registration Statement shall provide for resales of all
Transfer Restricted Securities held by Holders that have
provided the information required pursuant to the terms of
Section 2(b) hereof;
(ii) use commercially reasonable efforts to cause
the Shelf Registration Statement to be declared effective by
the Commission not later than 210 days after the date hereof
(the "EFFECTIVENESS TARGET DATE"); and
(iii) use commercially reasonable efforts to keep
the Shelf Registration Statement continuously effective,
supplemented and amended as required by the provisions of
Section 4(b) hereof to the extent necessary to ensure that (A)
it is available for resales by the Holders of Transfer
Restricted Securities entitled, subject to Section 2(b), to
the benefit of this Agreement and (B) conforms with the
requirements of this Agreement and the Securities Act and the
rules and regulations of the Commission promulgated
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thereunder as announced from time to time, for a period (the
"EFFECTIVENESS PERIOD") until the earliest of:
(1) two years following the last date
of original issuance of any of the Debentures;
(2) the date when the Holders of
Transfer Restricted Securities are able to sell all
such Transfer Restricted Securities immediately
without restriction pursuant to the volume limitation
provisions of Rule 144 under the Securities Act; or
(3) the date when all of the Transfer
Restricted Securities of those Holders that complete
and deliver in a timely manner the Holder
Questionnaire described below are registered under
the Shelf Registration Statement and disposed of in
accordance with the Shelf Registration Statement.
(b) At the time the Shelf Registration Statement is
declared effective, each Holder that became a Notice Holder on or prior
to the date fifteen (15) Business Days prior to such time of
effectiveness shall be named as a selling securityholder in the Shelf
Registration Statement and the related Prospectus in such a manner as
to permit such Holder to deliver such Prospectus to purchasers of
Transfer Restricted Securities in accordance with applicable law. None
of the Company's securityholders (other than the Holders of Transfer
Restricted Securities) shall have the right to include any of the
Company's securities in the Shelf Registration Statement.
(c) If the Shelf Registration Statement or any
Subsequent Shelf Registration Statement ceases to be effective for any
reason at any time during the Effectiveness Period (other than because
all Transfer Restricted Securities registered thereunder shall have
been resold pursuant thereto or shall have otherwise ceased to be
Transfer Restricted Securities), the Company shall use its reasonable
best efforts to obtain the prompt withdrawal of any order suspending
the effectiveness thereof, and in any event shall within thirty (30)
days of such cessation of effectiveness amend the Shelf Registration
Statement in a manner reasonably expected to obtain the withdrawal of
the order suspending the effectiveness thereof, or file an additional
Shelf Registration Statement covering all of the securities that as of
the date of such filing are Transfer Restricted Securities ( a
"SUBSEQUENT SHELF REGISTRATION STATEMENT"). If a Subsequent Shelf
Registration Statement is filed, the Company shall use its reasonable
best efforts to cause the Subsequent Shelf Registration Statement to
become effective as promptly as is practicable after such filing and to
keep such Registration Statement (or subsequent Shelf
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Registration Statement) continuously effective until the end of the
Effectiveness Period.
(d) The Company shall supplement and amend the Shelf
Registration Statement if required by the rules, regulations or
instructions applicable to the registration form used by the Company
for such Shelf Registration Statement, if required by the Securities
Act or as reasonably requested by the Initial Purchasers or by the
Trustee on behalf of the Holders of the Transfer Restricted Securities
covered by such Shelf Registration Statement.
(e) Each Holder agrees that if such Holder wishes to
sell Transfer Restricted Securities pursuant to a Shelf Registration
Statement and related Prospectus, it will do so only in accordance with
this Section 2(e) and Section 4(b). Each Holder wishing to sell
Transfer Restricted Securities pursuant to a Shelf Registration
Statement and related Prospectus agrees to deliver a Notice and
Questionnaire to the Company at least three (3) Business Days prior to
any intended distribution of Transfer Restricted Securities under the
Shelf Registration Statement. From and after the date the Shelf
Registration Statement is declared effective the Company shall, as
promptly as practicable after the date a Notice and Questionnaire is
delivered, and in any event upon the later of (x) ten (10) Business
Days after such date (but no earlier than ten (10) Business Days after
effectiveness) or (y) ten (10) Business Days after the expiration of
any Suspension Period in effect when the Notice and Questionnaire is
delivered or put into effect within ten (10) Business Days of such
delivery date:
(i) if required by applicable law, file with
the SEC a post-effective amendment to the Shelf Registration
Statement or prepare and, if required by applicable law, file
a supplement to the related Prospectus or a supplement or
amendment to any document incorporated therein by reference or
file any other required document so that the Holder delivering
such Notice and Questionnaire is named as a selling
securityholder in the Shelf Registration Statement and the
related Prospectus in such a manner as to permit such Holder
to deliver such Prospectus to purchasers of the Transfer
Restricted Securities in accordance with applicable law and,
if the Company shall file a post-effective amendment to the
Shelf Registration Statement, use commercially reasonable
efforts to cause such post-effective amendment to be declared
effective under the Securities Act as promptly as is
practicable, but in any event by the date (the "AMENDMENT
EFFECTIVENESS DEADLINE DATE") that is sixty (60) days after
the date such post effective amendment is required by this
clause to be filed:
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(ii) provide such Holder copies of the any
documents filed pursuant to Section 2(e)(i); and
(iii) notify such Holder as promptly as
practicable after the effectiveness under the Securities Act
of any post-effective amendment filed pursuant to Section
2(e)(i);
provided that if such Notice and Questionnaire is delivered during a Suspension
Period, the Company shall so inform the Holder delivering such Notice and
Questionnaire and shall take the actions set forth in clauses (i), (ii) and
(iii) above upon expiration of the Suspension Period in accordance with Section
4(b). Notwithstanding anything contained herein to the contrary, (i) the Company
shall be under no obligation to name any Holder that is not a Notice Holder as a
selling securityholder in any Registration Statement or related Prospectus and
(ii) the Amendment Effectiveness Deadline Date shall be extended by up to ten
(10) Business Days from the expiration of a Suspension Period (and the Company
shall incur no obligation to pay Liquidated Damages during such extension) if
such Suspension Period shall be in effect on the Amendment Effectiveness
Deadline Date.
3. Liquidated Damages.
(a) If:
(i) the Shelf Registration Statement is not
filed with the Commission prior to or on the Shelf Filing
Deadline;
(ii) the Shelf Registration Statement has not
been declared effective by the Commission prior to or on the
Effectiveness Target Date;
(iii) the Company has failed to perform its
obligations set forth in Section 2(e) within the time period
required therein;
(iv) any post-effective amendment to a Shelf
Registration filed pursuant to Section 2(e)(i) has not become
effective under the Securities Act on or prior to the
Amendment Effectiveness Deadline Date;
(v) except as provided in Section 4(b)(i)
hereof, the Shelf Registration Statement is filed and declared
effective but, during the Effectiveness Period, shall
thereafter cease to be effective or fail to be usable for its
intended purpose without being succeeded within ten Business
Days by a post-effective amendment to the Shelf Registration
Statement, a supplement to the Prospectus or a report filed
with the Commission pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act that cures such failure and, in the
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case of a post-effective amendment, is itself immediately
declared effective; or
(vi) (A) prior to or on the 45th or 60th day, as
the case may be, of any Suspension Period, such suspension has
not been terminated or (B) Suspension Periods exceed an
aggregate of 120 days in any 360 day period,
(each such event referred to in foregoing clauses (i) through (iv), a
"REGISTRATION DEFAULT"), the Company hereby agrees to pay interest ("LIQUIDATED
DAMAGES") or issue additional shares of Common Stock, as applicable, with
respect to the Transfer Restricted Securities from and including the day
following the Registration Default to but excluding the earlier of (1) the day
on which the Registration Default has been cured and (2) the date the Shelf
Registration Statement is no longer required to be kept effective as set out
below:
(A) in respect of the Debentures, the
Company agrees to pay interest to each holder of
Debentures accruing at a rate of (x) with respect to
the first 90-day period during which a Registration
Default shall have occurred and be continuing, equal
to 0.25% per annum of the aggregate issue price of
the Debentures, and (y) with respect to the period
commencing on the 91st day following the day the
Registration Default shall have occurred and be
continuing, equal to 0.50% per annum of the aggregate
issue price of the Debentures; provided that in no
event shall Liquidated Damages accrue at a rate per
year exceeding 0.50% of the aggregate issue price of
the Debentures;
(B) in respect of Debentures submitted
for conversion into Common Stock during a
Registration Default, the Company agrees to pay
accrued and unpaid Liquidated Damages calculated in
accordance with paragraph (A) up to and including the
Settlement Date (as defined in the Indenture) and to
issue additional shares to each Holder that has
submitted for conversion some or all of its
Debentures into Common Stock equal to 3% of the
Applicable Conversion Rate (as defined in the
Indenture) for each $1,000 principal amount of
Debentures (except to the extent the Company elects
to deliver cash upon conversion in accordance with
the terms of the Indenture); and
(C) in respect of Common Stock, each
Holder of such Common Stock will not be entitled to
any Liquidated Damages.
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(b) All accrued Liquidated Damages shall be paid in
arrears to Record Holders by the Company on each Liquidated Damages
Payment Date. Upon the cure of all Registration Defaults relating to
any particular Debenture or share of Common Stock, the accrual of
Liquidated Damages with respect to such Debenture or share of Common
Stock will cease.
All obligations of the Company set forth in this Section 3 that are
outstanding with respect to any Transfer Restricted Security at the time such
security ceases to be a Transfer Restricted Security shall survive until such
time as all such obligations with respect to such Transfer Restricted Security
shall have been satisfied in full.
The Liquidated Damages set forth above shall be the exclusive monetary
remedy available to the Holders of Transfer Restricted Securities for each
Registration Default.
4. Registration Procedures.
(a) In connection with the Shelf Registration Statement,
the Company shall comply with all the provisions of Section 4(b) hereof
and shall use commercially reasonable efforts to effect such
registration to permit the sale of the Transfer Restricted Securities,
and pursuant thereto, shall as expeditiously as possible prepare and
file with the Commission a Shelf Registration Statement relating to the
registration on any appropriate form under the Securities Act.
(b) In connection with the Shelf Registration Statement
and any Prospectus required by this Agreement to permit the sale or
resale of Transfer Restricted Securities, the Company shall:
(i) Subject to any notice by the Company in
accordance with this Section 4(b) of the existence of any fact
or event of the kind described in Section 4(b)(iii)(D), use
commercially reasonable efforts to keep the Shelf Registration
Statement continuously effective during the Effectiveness
Period; upon the occurrence of any event that would cause the
Shelf Registration Statement or the Prospectus contained
therein (A) to contain a material misstatement or omission or
(B) not to be effective and usable for resale of Transfer
Restricted Securities during the Effectiveness Period, the
Company shall file promptly an appropriate amendment to the
Shelf Registration Statement, a supplement to the Prospectus
or a report filed with the Commission pursuant to Section
13(a), 13(c), 14 or 15(d) of the Exchange Act, in the case of
clause (A), correcting any such misstatement or omission, and,
in the case of either clause (A) or (B), use commercially
reasonable efforts to cause such amendment to be declared
effective and the Shelf Registration Statement and the
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related Prospectus to become usable for their intended
purposes as soon as practicable thereafter. Notwithstanding
the foregoing, the Company may suspend the effectiveness of
the Shelf Registration Statement by written notice to the
Holders for a period not to exceed an aggregate of 45 days in
any 90-day period (each such period, a "SUSPENSION PERIOD")
upon:
(x) the occurrence or existence of any
fact or the happening of any event as a result of which the
Shelf Registration Statement, the Prospectus, any amendment or
supplement thereto, or any document incorporated by reference
therein would, in the Company's judgment, contain an untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the
statements therein not misleading; and
(y) the occurrence or existence of any
corporate development that, in the Company's judgment, makes
it appropriate to suspend the effectiveness of the Shelf
Registration Statement;
provided that the Company will use its reasonable best efforts to
ensure that the use of the Prospectus may be resumed (A) in the case of
clause (x) above, as soon as, in the sole judgment of the Company,
public disclosure of such fact or event would not be prejudicial to or
contrary to the interests of the Company or, if necessary to avoid
unreasonable burden or expense, as soon as practicable thereafter and
(B) in the case of clause (y) above, as soon as, in the discretion of
the Company, such suspension is no longer appropriate; provided,
however, that Suspension Periods shall not exceed an aggregate of 120
days in any 360-day period. The Company shall not be required to
specify in the written notice to the Holders the nature of the event
giving rise to the Suspension Period.
(ii) Prepare and file with the Commission such
amendments and post-effective amendments to the Shelf
Registration Statement as may be necessary to keep the Shelf
Registration Statement effective during the Effectiveness
Period; cause the Prospectus to be supplemented by any
required Prospectus supplement, and as so supplemented to be
filed pursuant to Rule 424 under the Securities Act, and to
comply fully with the applicable provisions of Rules 424 and
430A under the Securities Act in a timely manner; and comply
with the provisions of the Securities Act with respect to the
disposition of all Debentures covered by the Shelf
Registration Statement during the applicable period in
accordance with the intended method or methods of distribution
by the sellers thereof set forth in the Shelf Registration
Statement or supplement to the Prospectus.
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(iii) Advise the selling Holders promptly and, if
requested by such selling Holders, to confirm such advice in
writing, except as provided in clause (D) below:
(A) when the Prospectus or any
Prospectus supplement or post-effective amendment has
been filed, and, with respect to the Shelf
Registration Statement or any post-effective
amendment thereto, when the same has become
effective,
(B) of any request by the Commission
for amendments to the Shelf Registration Statement or
amendments or supplements to the Prospectus or for
additional information relating thereto,
(C) of the issuance by the Commission
of any stop order suspending the effectiveness of the
Shelf Registration Statement under the Securities Act
or of the suspension by any state securities
commission of the qualification of the Transfer
Restricted Securities for offering or sale in any
jurisdiction, or the initiation of any proceeding for
any of the preceding purposes, or
(D) of the existence of any fact or the
happening of any event, during the Effectiveness
Period, that makes any statement of a material fact
made in the Shelf Registration Statement, the
Prospectus, any amendment or supplement thereto, or
any document incorporated by reference therein
untrue, or that requires the making of any additions
to or changes in the Shelf Registration Statement or
the Prospectus in order to make the statements
therein not misleading.
If at any time the Commission shall issue any stop order suspending the
effectiveness of the Shelf Registration Statement, or any state
securities commission or other regulatory authority shall issue an
order suspending the qualification or exemption from qualification of
the Transfer Restricted Securities under state securities or Blue Sky
laws, the Company shall use its reasonable best efforts to obtain the
withdrawal or lifting of such order at the earliest possible time and
will provide to each Holder who is named in the Shelf Registration
Statement prompt notice of the withdrawal of any such order.
(iv) Make available at reasonable times for
inspection by one or more representatives of the selling
Holders, designated in writing by a Majority of Holders whose
Transfer Restricted Securities are included in the Shelf
Registration Statement, and any
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attorney or accountant retained by such selling Holders, all
financial and other records, pertinent corporate documents and
properties of the Company as shall be reasonably necessary to
enable them to conduct a reasonable investigation within the
meaning of Section 11 of the Securities Act, and cause the
Company's officers, directors, managers and employees to
supply all information reasonably requested by any such
representative or representatives of the selling Holders,
attorney or accountant in connection therewith; provided,
however, that the Company shall have no obligation to deliver
information to any selling Holder or representative pursuant
to this Section 4(b)(iv) unless such selling Holder or
representative shall have executed and delivered a
confidentiality agreement in a form acceptable to the Company
relating to such information.
(v) If requested by any selling Holders,
promptly incorporate in the Shelf Registration Statement or
Prospectus, pursuant to a supplement or post-effective
amendment if necessary, such information as such selling
Holders may reasonably request to have included therein,
including, without limitation, information relating to the
"PLAN OF DISTRIBUTION" of the Transfer Restricted Securities.
(vi) Furnish to each selling Holder upon their
request, without charge, at least one copy of the Shelf
Registration Statement, as first filed with the Commission,
and of each amendment thereto (and any documents incorporated
by reference therein or exhibits thereto (or exhibits
incorporated in such exhibits by reference) as such Person may
request).
(vii) Deliver to each selling Holder, without
charge, as many copies of the Prospectus (including each
preliminary Prospectus) and any amendment or supplement
thereto as such Persons reasonably may request; subject to any
notice by the Company in accordance with this Section 4(b) of
the existence of any fact or event of the kind described in
Section 4(b)(iii)(D), the Company hereby consents to the use
of the Prospectus and any amendment or supplement thereto by
each of the selling Holders in connection with the offering
and the sale of the Transfer Restricted Securities covered by
the Prospectus or any amendment or supplement thereto.
(viii) Before any public offering of Transfer
Restricted Securities, cooperate with the selling Holders and
their counsel in connection with the registration and
qualification of the Transfer Restricted Securities under the
securities or Blue Sky laws of such
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jurisdictions in the United States as the selling Holders may
reasonably request and do any and all other acts or things
necessary or advisable to enable the disposition in such
jurisdictions of the Transfer Restricted Securities covered by
the Shelf Registration Statement; provided, however, that the
Company shall not be required (A) to register or qualify as a
foreign corporation or a dealer of securities where it is not
now so qualified or to take any action that would subject it
to the service of process in any jurisdiction where it is not
now so subject or (B) to subject itself to general or
unlimited service of process or to taxation in any such
jurisdiction if they are not now so subject.
(ix) Cooperate with the selling Holders to
facilitate the timely preparation and delivery of certificates
representing Transfer Restricted Securities to be sold and not
bearing any restrictive legends (unless required by applicable
securities laws); and enable such Transfer Restricted
Securities to be in such denominations and registered in such
names as the Holders may request at least two Business Days
before any sale of Transfer Restricted Securities.
(x) Use its reasonable best efforts to cause the
Transfer Restricted Securities covered by the Shelf
Registration Statement to be registered with or approved by
such other U.S. governmental agencies or authorities as may be
necessary to enable the seller or sellers thereof to
consummate the disposition of such Transfer Restricted
Securities.
(xi) Subject to Section 4(b)(i) hereof, if any
fact or event contemplated by Section 4(b)(iii)(D) hereof
shall exist or have occurred, use its reasonable best efforts
to prepare a supplement or post-effective amendment to the
Shelf Registration Statement or related Prospectus or any
document incorporated therein by reference or file any other
required document so that, as thereafter delivered to the
purchasers of Transfer Restricted Securities, the Prospectus
will not contain an untrue statement of a material fact or
omit to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the
circumstances in which they are made, not misleading.
(xii) Provide CUSIP numbers for all Transfer
Restricted Securities not later than the effective date of the
Shelf Registration Statement and provide the Trustee under the
Indenture with certificates for the Debentures that are in a
form eligible for deposit with The Depository Trust Company.
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(xiii) Cooperate and assist in any filings required
to be made with the NASD and in the performance of any due
diligence investigation by any underwriter that is required to
be retained in accordance with the rules and regulations of
the NASD.
(xiv) Otherwise use its best efforts to comply
with all applicable rules and regulations of the Commission
and all reporting requirements under the rules and regulations
of the Exchange Act.
(xv) Cause the Indenture to be qualified under
the TIA not later than the effective date of the Shelf
Registration Statement required by this Agreement, and, in
connection therewith, cooperate with the Trustee and the
holders of Debentures to effect such changes to the Indenture
as may be required for such Indenture to be so qualified in
accordance with the terms of the TIA; and execute and use its
reasonable best efforts to cause the Trustee thereunder to
execute all documents that may be required to effect such
changes and all other forms and documents required to be filed
with the Commission to enable such Indenture to be so
qualified in a timely manner.
(xvi) Cause all Common Stock covered by the Shelf
Registration Statement to be listed or quoted, as the case may
be, on each securities exchange or automated quotation system
on which Common Stock is then listed or quoted.
(xvii) Provide to each Holder upon written request
each document filed with the Commission pursuant to the
requirements of Section 13 and Section 15 of the Exchange Act
after the effective date of the Shelf Registration Statement,
unless such document is available through the Commission's
EDGAR system.
(c) Each Holder agrees by acquisition of a Transfer
Restricted Security that, upon receipt of any notice (a "SUSPENSION
NOTICE") from the Company of the existence of any fact of the kind
described in Section 4(b)(iii)(D) hereof, such Holder will forthwith
discontinue disposition of Transfer Restricted Securities pursuant to
the Shelf Registration Statement until:
(i) such Holder has received copies of the
supplemented or amended Prospectus contemplated by Section
4(b)(xi) hereof; or
(ii) such Holder is advised in writing by the
Company that the use of the Prospectus may be resumed, and has
received copies of any additional or supplemental filings that
are incorporated by reference in the Prospectus.
15
If so directed by the Company, each Holder will deliver to the Company (at the
Company's expense) all copies, other than permanent file copies then in such
Holder's possession, of the Prospectus covering such Transfer Restricted
Securities that was current at the time of receipt of such notice of suspension.
(d) Each Holder agrees by acquisition of a Transfer
Restricted Security, that no Holder shall be entitled to sell any of
such Transfer Restricted Securities pursuant to a Registration
Statement; or to receive a Prospectus relating thereto, unless such
Holder has furnished the Company with a Notice and Questionnaire as
required pursuant to Section 2(e) hereof (including the information
required to be included in such Notice and Questionnaire) and the
information set forth in the next sentence. Each Notice Holder agrees
promptly to furnish to the Company all information required to be
disclosed in order to make the information previously furnished to the
Company by such Notice Holder not misleading and any other information
regarding such Notice Holder and the distribution of such Transfer
Restricted Securities as the Company may from time to time reasonably
request in writing. Any sale of any Transfer Restricted Securities by
any Holder shall constitute a representation and warranty by such
Holder that the information relating to such Holder and its plan of
distribution is as set forth in the Prospectus delivered by such Holder
in connection with such disposition, that such Prospectus does not as
of the time of such sale contain any untrue statement of a material
fact relating to or provided by such Holder to its plan of distribution
and that such Prospectus does not as of the time of such sale omit to
state any material fact relating to or provided by such Holder or its
plan of distribution necessary to make the statements in such
Prospectus, in the light of the circumstances under which they were
made not misleading.
5. Registration Expenses.
All expenses incident to the Company's performance of or compliance
with this Agreement shall be borne by the Company regardless of whether a Shelf
Registration Statement becomes effective, including, without limitation:
(i) all registration and filing fees and
expenses (including filings made with the NASD);
(ii) all fees and expenses of compliance with
federal securities and state Blue Sky or securities laws;
(iii) all expenses of printing (including printing
of Prospectuses and certificates for the Common Stock to be
issued upon conversion of the Debentures) and the Company's
expenses for messenger and delivery services and telephone;
16
(iv) all fees and disbursements of counsel to the
Company;
(v) all application and filing fees in
connection with listing (or authorizing for quotation) the
Common Stock on a national securities exchange or automated
quotation system pursuant to the requirements hereof; and
(vi) all fees and disbursements of independent
certified public accountants of the Company.
The Company shall bear its internal expenses (including, without
limitation, all salaries and expenses of their officers and employees performing
legal, accounting or other duties), the expenses of any annual audit and the
fees and expenses of any Person, including special experts, retained by the
Company.
6. Indemnification And Contribution.
(a) The Company agrees to indemnify and hold harmless
each Holder of Transfer Restricted Securities covered by the Shelf
Registration Statement (including each Initial Purchaser), and its
directors, officers, and employees and each person, if any, who
controls any such Holder within the meaning of the Securities Act or
the Exchange Act (each, an "INDEMNIFIED Holder"), against any loss,
claim, damage, liability or expense, joint or several, or any action in
respect thereof (including, but not limited to, any loss, claim,
damage, liability or action relating to resales of the Transfer
Restricted Securities), to which such Indemnified Holder may become
subject, insofar as any such loss, claim, damage, liability or action
arises out of, or is based upon:
(i) any untrue statement or alleged untrue
statement of a material fact contained in (A) the Shelf
Registration Statement as originally filed or in any amendment
thereof, in any Prospectus, or in any amendment or supplement
thereto or (B) any blue sky application or other document or
any amendment or supplement thereto prepared or executed by
the Company (or based upon written information furnished by or
on behalf of the Company expressly for use in such blue sky
application or other document or amendment on supplement)
filed in any jurisdiction specifically for the purpose of
qualifying any or all of the Transfer Restricted Securities
under the securities law of any state or other jurisdiction
(such application or document being hereinafter called a "BLUE
SKY APPLICATION"); or
(ii) the omission or alleged omission to state
therein any material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading,
17
and agrees to reimburse each Indemnified Holder promptly upon demand for any
legal or other expenses reasonably incurred by such Indemnified Holder in
connection with investigating, defending, settling, compromising or paying any
such loss, claim, damage, liability, expense or action; provided, however, that
the Company shall not be liable in any such case to the extent that any such
loss, claim, damage, liability or expense arises out of, or is based upon, any
untrue statement or alleged untrue statement or omission or alleged omission
made in reliance upon and in conformity with written information furnished to
the Company by or on behalf of such Holder (or its related Indemnified Holder)
specifically for use therein. The foregoing indemnity agreement is in addition
to any liability which the Company may otherwise have.
(b) Each Holder, severally and not jointly, agrees to
indemnify and hold harmless the Company, its directors, officers and
employees and each person, if any, who controls the Company within the
meaning of the Securities Act or the Exchange Act to the same extent as
the foregoing indemnity from the Company to each such Holder, but only
with reference to written information relating to such Holder furnished
to the Company by or on behalf of such Holder specifically for
inclusion in the documents referred to in the foregoing indemnity. This
indemnity agreement set forth in this Section shall be in addition to
any liabilities which any such Holder may otherwise have. In no event
shall any Holder, its directors, officers or any person who controls
such Holder be liable or responsible for any amount in excess of the
amount by which the total amount received by such Holder with respect
to its sale of Transfer Restricted Securities pursuant to a Shelf
Registration Statement exceeds (i) the amount paid by such Holder for
such Transfer Restricted Securities and (ii) the amount of any damages
that such Holder, its directors, officers or any person who controls
such Holder has otherwise been required to pay by reason of such untrue
or alleged untrue statement or omission or alleged omission.
(i) Promptly after receipt by an indemnified
party under this Section 6 of notice of any claim or the
commencement of any action, the indemnified party shall, if a
claim in respect thereof is to be made against the
indemnifying party under this Section 6, notify the
indemnifying party in writing of the claim or the commencement
of that action; provided, however, that the failure to notify
the indemnifying party shall not relieve it from any liability
which it may have under this Section 6 except to the extent it
has been materially prejudiced by such failure and, provided,
further, that the failure to notify the indemnifying party
shall not relieve it from any liability which it may have to
an indemnified party otherwise than under this Section 6. If
any such claim or action shall be brought against an
indemnified party, and it shall notify the indemnifying party
thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes,
18
jointly with any other similarly notified indemnifying party,
to assume the defense thereof with counsel satisfactory to the
indemnified party. After notice from the indemnifying party to
the indemnified party of its election to assume the defense of
such claim or action, the indemnifying party shall not be
liable to the indemnified party under this Section 6 for any
legal or other expenses subsequently incurred by the
indemnified party in connection with the defense thereof other
than reasonable costs of investigation; provided, however,
that the Holders shall have the right to employ a single
counsel to represent jointly the Holders and their officers,
employees and controlling persons who may be subject to
liability arising out of any claim in respect of which
indemnity may be sought by the Holders against the Company
under this Section 6 if the Holders seeking indemnification
shall have been advised by legal counsel that there may be one
or more legal defenses available to such Holders and their
respective officers, employees and controlling persons that
are different from or additional to those available to the
Company, and in that event, the fees and expenses of such
separate counsel shall be paid by the Company.
(c) The indemnifying party under this Section shall not
be liable for any settlement of any proceeding effected without its
written consent, which shall not be withheld unreasonably, but if
settled with such consent or if there is a final judgment for the
plaintiff, the indemnifying party agrees to indemnify the indemnified
party against any loss, claim, damage, liability or expense by reason
of such settlement or judgment. Notwithstanding the foregoing sentence,
if at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and
expenses of counsel as contemplated by Section 6(c) hereof, the
indemnifying party agrees that it shall be liable for any settlement of
any proceeding effected without its written consent if (i) such
settlement is entered into more than 30 days after receipt by such
indemnifying party of the aforesaid request and (ii) such indemnifying
party shall not have (A) reimbursed the indemnified party in accordance
with such request prior to the date of such settlement; or (B)
delivered notice to the indemnified party of its good faith objection
to such claim of indemnification within than 30 days after receipt by
such indemnifying party of the aforesaid request. No indemnifying party
shall, without the prior written consent of the indemnified party
(which consent shall not be unreasonably withheld), effect any
settlement, compromise or consent to the entry of judgment in any
pending or threatened action, suit or proceeding in respect of which
any indemnified party is or could have been a party and indemnity was
or could have been sought hereunder by such indemnified party, unless
such settlement, compromise or consent (x) includes an unconditional
release of such indemnified party from all
19
liability on claims that are the subject matter of such action, suit or
proceeding and (y) does not include a statement as to or an admission
of fault, culpability or a failure to act by or on behalf of any
indemnified party.
(d) If the indemnification provided for in this Section 6
shall for any reason be unavailable or insufficient to hold harmless an
indemnified party under Section 6(a) or 6(b) in respect of any loss,
claim, damage or liability (or action in respect thereof) referred to
therein, each indemnifying party shall, in lieu of indemnifying such
indemnified party, contribute to the amount paid or payable by such
indemnified party as a result of such loss, claim, damage or liability
(or action in respect thereof):
(i) in such proportion as is appropriate to
reflect the relative benefits received by the Company from the
offering and sale of the Transfer Restricted Securities on the
one hand and a Holder with respect to the sale by such Holder
of the Transfer Restricted Securities on the other, or
(ii) if the allocation provided by Section
(6)(d)(i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative
benefits referred to in Section 6(d)(i) but also the relative
fault of the Company on the one hand and the Holders on the
other in connection with the statements or omissions or
alleged statements or alleged omissions that resulted in such
loss, claim, damage or liability (or action in respect
thereof), as well as any other relevant equitable
considerations.
The relative benefits received by the Company on the one hand and a Holder on
the other with respect to such offering and such sale shall be deemed to be in
the same proportion as the total net proceeds from the offering of the
Debentures purchased under the Purchase Agreement (before deducting expenses)
received by the Company, on the one hand, bear to the total proceeds received by
such Holder with respect to its sale of Transfer Restricted Securities on the
other. The relative fault of the parties shall be determined by reference to
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company on the one hand or the Holders on the other, the intent
of the parties and their relative knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company and
each Holder agree that it would not be just and equitable if the amount of
contribution pursuant to this Section 6(d) were determined by pro rata
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to in the first sentence of this paragraph
(d).
The amount paid or payable by an indemnified party as a result of the
loss, claim, damage or liability, or action in respect thereof, referred to
above in this
20
Section 6 shall be deemed to include, for purposes of this Section
6, any legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending or preparing to defend any such
action or claim.
Notwithstanding the provisions of this Section 6, no Holder shall be
required to contribute any amount in excess of the amount by which the total
price at which the Transfer Restricted Securities purchased by it were resold
exceeds the amount of any damages which such Holder has otherwise been required
to pay by reason of any untrue or alleged untrue statement or omission or
alleged omission. No Person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any Person who was not guilty of such fraudulent
misrepresentation. The Holders' obligations to contribute as provided in this
Section 6(d) are several and not joint.
(e) The provisions of this Section 6 shall remain in full
force and effect, regardless of any investigation made by or on behalf
of any Holder or the Company or any of the officers, directors or
controlling persons referred to in Section 6 hereof, and will survive
the sale by a Holder of Transfer Restricted Securities.
7. Rule 144A and Rule 144. The Company agrees with each Holder,
for so long as any Transfer Restricted Securities remain outstanding and during
any period in which the Company (i) is not subject to Section 13 or 15(d) of the
Exchange Act, to make available, upon request of any Holder, to such Holder or
beneficial owner of Transfer Restricted Securities in connection with any sale
thereof and any prospective purchaser of such Transfer Restricted Securities
designated by such Holder or beneficial owner, the information required by Rule
144A(d)(4) under the Securities Act in order to permit resales of such Transfer
Restricted Securities pursuant to Rule 144A, and (ii) is subject to Section 13
or 15 (d) of the Exchange Act, to make all filings required thereby in a timely
manner in order to permit resales of such Transfer Restricted Securities
pursuant to Rule 144.
8. No Participation In Underwritten Registrations. No Holder may
participate in any Underwritten Registration hereunder.
9. Miscellaneous.
(a) Remedies. The Company acknowledges and agrees that
any failure by the Company to comply with its obligations under Section
2 hereof may result in material irreparable injury to the Initial
Purchasers or the Holders for which there is no adequate remedy at law,
that it will not be possible to measure damages for such injuries
precisely, and that, in the event of any such failure, the Initial
Purchasers or any Holder may obtain such relief as may be required to
specifically enforce the Company's obligations under Section 2 hereof.
The Company further agrees to waive
21
the defense in any action for specific performance that a remedy at law
would be adequate.
(b) Actions Affecting Transfer Restricted Securities. The
Company shall not, directly or indirectly, take any action with respect
to the Transfer Restricted Securities as a class that would adversely
affect the ability of the Holders of Transfer Restricted Securities to
include such Transfer Restricted Securities in a registration
undertaken pursuant to this Agreement.
(c) No Inconsistent Agreements. The Company has not, as
of the date hereof, entered into, nor shall it, on or after the date
hereof, enter into, any agreement with respect to its securities that
is inconsistent with the rights granted to the Holders in this
Agreement or otherwise conflicts with the provisions hereof. In
addition, the Company shall not on or after the date hereof grant to
any of its securityholders (other than the Holders of Transfer
Restricted Securities in such capacity) the right to include any of its
securities in the Shelf Registration Statement provided for in this
Agreement other than the Transfer Restricted Securities.
(d) Amendments and Waivers. This Agreement may not be
amended, modified or supplemented, and waivers or consents to or
departures from the provisions hereof may not be given, unless the
Company has obtained the written consent of a Majority of Holders;
provided, however, that with respect to any matter that directly or
indirectly adversely affects the rights of any Initial Purchaser
hereunder, the Company shall obtain the written consent of each such
Initial Purchaser against which such amendment, qualification,
supplement, waiver or consent is to be effective. Notwithstanding the
foregoing (except the foregoing proviso), a waiver or consent to depart
from the provisions hereof, with respect to a matter, which relates
exclusively to the rights of Holders whose securities are being sold
pursuant to a Shelf Registration Statement and does not directly or
indirectly adversely affect the rights of other Holders, may be given
by the Majority Holders, determined on the basis of Debentures being
sold rather than registered under such Shelf Registration Statement.
(e) Notices. All notices and other communications
provided for or permitted hereunder shall be made in writing by hand
delivery, first class mail (registered or certified, return receipt
requested), telex, facsimile transmission, or air courier guaranteeing
overnight delivery:
(i) if to a Holder, at the address set forth on
the records of the registrar under the Indenture or the
transfer agent of the Common Stock, as the case may be; and
22
(ii) if to the Company, initially at its address
set forth in the Purchase Agreement.
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five Business
Days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if telexed; when receipt acknowledged, if transmitted by
facsimile; and on the next Business Day, if timely delivered to an air courier
guaranteeing overnight delivery.
Any party hereto may change the address for receipt of communications
by giving written notice to the others.
(f) Successors and Assigns. This Agreement shall inure to
the benefit of and be binding upon the successors and assigns of each
of the parties, including without limitation and without the need for
an express assignment, subsequent Holders of Transfer Restricted
Securities. The Company hereby agrees to extend the benefit of this
Agreement to any Holder and any such Holder may specifically enforce
the provisions of this Agreement as if an original party hereto.
(g) Counterparts. This Agreement may be executed in any
number of counterparts and by the parties hereto in separate
counterparts, each of which when so executed shall be deemed to be an
original and all of which taken together shall constitute one and the
same agreement.
(h) Debentures Held by the Company or Their Affiliates.
Whenever the consent or approval of Holders of a specified percentage
of Transfer Restricted Securities is required hereunder, Transfer
Restricted Securities held by the Company or its Affiliates (other than
subsequent Holders if such subsequent Holders are deemed to be
Affiliates solely by reason of their holding of such Debentures) shall
not be counted in determining whether such consent or approval was
given by the Holders of such required percentage.
(i) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect
the meaning hereof.
(j) Governing Law. This Agreement shall be governed by
and construed in accordance with the law of the State of New York.
(k) Severability. If any one or more of the provisions
contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be affected or impaired
thereby, it being
23
intended that all of the rights and privileges of the parties shall be
enforceable to the fullest extent permitted by law.
(l) Entire Agreement. This Agreement is intended by the
parties as a final expression of their agreement and intended to be a
complete and exclusive statement of the agreement and understanding of
the parties hereto in respect of the subject matter contained herein.
There are no restrictions, promises, warranties or undertakings, other
than those set forth or referred to herein with respect to the
registration rights granted by the Company with respect to the Transfer
Restricted Securities. This Agreement supersedes all prior agreements
and understandings between the parties with respect to such subject
matter.
24
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
QUANTA SERVICES, INC.
By /s/ DANA A. GORDON
--------------------------------
Name: Dana A. Gordon
Title: Vice President, General
Counsel and Secretary
BANC OF AMERICA SECURITIES LLC
J.P. MORGAN SECURITIES, INC.
Acting severally on behalf of
themselves and the several Initial
Purchasers
By BANC OF AMERICA SECURITIES LLC
By /s/ DEREK DILLON
---------------------------------
Authorized Representative
Derek Dillon, Managing Director
By J.P. MORGAN SECURITIES INC.
By /s/ JEFF ZAJKOWSKI
---------------------------------
Authorized Representative
Jeff Zajkowski, Managing Director