EXHIBIT 4.4
EXECUTION COPY
AVIALL, INC.
7 5/8% SENIOR NOTES DUE 2011
REGISTRATION RIGHTS AGREEMENT
New York, New York
June 30, 2003
Citigroup Global Markets Inc.
Credit Suisse First Boston LLC
Wachovia Securities, LLC,
As Representatives of the Initial Purchasers
c/o Citigroup Global Markets Inc.
388 Greenwich Street
New York, New York 10013
Ladies and Gentlemen:
Aviall, Inc., a corporation organized under the laws of
Delaware (the "Company"), proposes to issue and sell its 7 5/8% Senior Notes due
2011 (the "Notes") to certain purchasers (the "Initial Purchasers"), upon the
terms set forth in a Purchase Agreement, dated as of June 25, 2003, by and among
the Company, the Company's direct and indirect subsidiaries set forth on the
signature page hereto (the "Subsidiary Guarantors") and the Initial Purchasers
(the "Purchase Agreement") relating to the initial placement of the Notes (the
"Initial Placement"). The Notes will be guaranteed (the "Guarantees" and,
together with the Notes, the "Securities") on an unsecured senior basis by each
of the Subsidiary Guarantors. To induce the Initial Purchasers to enter into the
Purchase Agreement and to satisfy a condition of your obligations thereunder,
the Company and the Subsidiary Guarantors, jointly and severally, agree with you
for your benefit and the benefit of the Holders (as defined herein), as follows:
1. Definitions. Capitalized terms used herein without
definition shall have their respective meanings set forth in the Purchase
Agreement. As used in this Agreement, the following capitalized defined terms
shall have the following meanings:
"Act" shall mean the Securities Act of 1933, as amended, and
the rules and regulations of the Commission promulgated thereunder.
"Affiliate" of any specified Person shall mean any other
Person that, 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 shall mean 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"
shall have meanings correlative to the foregoing.
"Broker-Dealer" shall mean any broker or dealer registered as
such under the Exchange Act.
"Business Day" shall mean any day other than a Saturday, a
Sunday or a legal holiday or a day on which banking institutions or trust
companies are authorized or obligated by law to close in New York City.
"Commission" shall mean the Securities and Exchange
Commission.
"Company" shall have the meaning set forth in the preamble
hereto.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended, and the rules and regulations of the Commission promulgated
thereunder.
"Exchange Guarantees" shall mean the guarantees of the
Subsidiary Guarantors with respect to the Exchange Notes.
"Exchange Notes" shall mean the 7 5/8% Senior Notes due 2011
issued by the Company containing terms identical in all material respects to the
Notes (except that (i) interest thereon shall accrue from the last date on which
interest was paid on the Notes or, if no such interest has been paid, from the
date of their original issue, (ii) the transfer restrictions thereon shall be
eliminated and (iii) certain provisions relating to an increase in the rate of
interest thereon shall be eliminated), to be offered to Holders in exchange for
the Notes pursuant to the Registered Exchange Offer.
"Exchange Offer Registration Period" shall mean the period
following the consummation of the Registered Exchange Offer, which period shall
end on the sooner of the 180th day after the consummation of the Registered
Exchange Offer and the date on which all Exchanging Dealers have sold all
Exchange Securities held by them (unless such period is extended pursuant to
Section 5(k) hereof).
"Exchange Offer Registration Statement" shall mean a
registration statement of the Company and the Subsidiary Guarantors on an
appropriate form under the Act with respect to the Registered Exchange Offer,
all amendments and supplements to such registration statement, including
post-effective amendments thereto, in each case including the Prospectus
contained therein, all exhibits thereto and all material incorporated by
reference therein.
"Exchange Securities" shall mean the Exchange Notes and
Exchange Guarantees.
"Exchanging Dealer" shall mean any Holder (which may include
any Initial Purchaser) that is a Broker-Dealer and elects to exchange for
Exchange Securities any Securities that it acquired for its own account as a
result of market-making activities or other trading activities (but not directly
from the Company or any Affiliate of the Company).
"Final Memorandum" shall have the meaning set forth in the
Purchase Agreement.
"Guarantees" shall have the meaning set forth in the preamble
hereto.
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"Holder" shall mean the registered holder (including any
Initial Purchaser) of Securities or, upon completion of the Registered Exchange
Offer, Exchange Securities, as the case may be.
"Indenture" shall mean the Indenture relating to the
Securities, dated as of June 30, 2003, among the Company, the Subsidiary
Guarantors and The Bank of New York, as trustee, as the same may be amended from
time to time in accordance with the terms thereof.
"Initial Placement" shall have the meaning set forth in the
preamble hereto.
"Initial Purchasers" shall have the meaning set forth in the
preamble hereto.
"Losses" shall have the meaning set forth in Section 7(d)
hereof.
"Majority Holders" shall mean the Holders of a majority of the
aggregate principal amount of Securities and Exchange Securities, as the case
may be, at any time outstanding.
"Managing Underwriters" shall mean the investment banker or
investment bankers and manager or managers that shall administer an underwritten
offering.
"Notes" shall have the meaning set forth in the preamble
hereto.
"Prospectus" shall mean the prospectus included in any
Registration Statement (including, without limitation, a prospectus that
discloses information previously omitted from a prospectus filed as part of an
effective registration statement in reliance upon Rule 430A under the Act), as
amended or supplemented by any prospectus supplement, with respect to the terms
of the offering of any portion of the Securities or the Exchange Securities
covered by such Registration Statement, and all amendments and supplements
thereto and all material incorporated by reference therein.
"Purchase Agreement" shall have the meaning set forth in the
preamble hereto.
"Registered Exchange Offer" shall mean the proposed offer of
the Company and the Subsidiary Guarantors to issue and deliver to the Holders
that are not prohibited by any law or policy of the Commission from
participating in such offer, in exchange for the Securities, a like aggregate
principal amount of the Exchange Securities.
"Registration Statement" shall mean any Exchange Offer
Registration Statement that covers any of the Exchange Securities or Shelf
Registration Statement that covers any of the Securities pursuant to the
provisions of this Agreement, any amendments and supplements to such
registration statement, including post-effective amendments (in each case
including the Prospectus contained therein), all exhibits thereto and all
material incorporated by reference therein.
"Securities" shall have the meaning set forth in the preamble
hereto.
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"Shelf Registration" shall mean a registration effected
pursuant to Section 3 hereof.
"Shelf Registration Period" has the meaning set forth in
Section 3(b) hereof.
"Shelf Registration Statement" shall mean a "shelf"
registration statement of the Company and the Subsidiary Guarantors pursuant to
the provisions of Section 3 hereof which covers some or all of the Securities on
an appropriate form under Rule 415 under the Act, or any similar rule that may
be adopted by the Commission, amendments and supplements to such registration
statement, including post-effective amendments, in each case including the
Prospectus contained therein, all exhibits thereto and all material incorporated
by reference therein.
"Trustee" shall mean the trustee with respect to the
Securities under the Indenture.
"Underwriter" shall mean any underwriter of Securities in
connection with an offering thereof under a Shelf Registration Statement.
2. Registered Exchange Offer.
(a) The Company shall use its reasonable best
efforts to prepare and, not later than 90 days following the date of
the original issuance of the Securities (or if such 90th day is not a
Business Day, the next succeeding Business Day), shall use its
reasonable best efforts to file with the Commission the Exchange Offer
Registration Statement with respect to the Registered Exchange Offer.
The Company shall use its reasonable best efforts to cause the Exchange
Offer Registration Statement to become effective under the Act not
later than 180 days following the date of the original issuance of the
Securities (or if such 180th day is not a Business Day, the next
succeeding Business Day).
(b) Upon the effectiveness of the Exchange Offer
Registration Statement, the Company shall as soon as practicable
commence the Registered Exchange Offer, it being the objective of such
Registered Exchange Offer to enable each Holder electing to exchange
Securities for Exchange Securities (assuming that such Holder is not an
Affiliate of the Company, acquires the Exchange Securities in the
ordinary course of such Holder's business, has no arrangements with any
Person to participate in the distribution of the Exchange Securities
and is not prohibited by any law or policy of the Commission from
participating in the Registered Exchange Offer) to trade such Exchange
Securities from and after their receipt without any limitations or
restrictions under the Act and without material restrictions under the
securities laws of a substantial proportion of the several states of
the United States. The Company, the Subsidiary Guarantors, the Holders
and each Exchanging Dealer acknowledge that, pursuant to current
interpretations by the Commission's staff of Section 5 of the
Securities Act, each Exchanging Dealer is required, in connection with
a sale of any such Exchange Securities received by such Exchanging
Dealer pursuant to the Registered Exchange Offer, to deliver a
prospectus containing substantially the information set forth in
Section 5(a)(ii) hereof.
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(c) In connection with the Registered Exchange
Offer, the Company shall:
(i) mail to each Holder a copy of the
Prospectus forming part of the Exchange Offer Registration
Statement, together with an appropriate letter of transmittal
and related documents;
(ii) keep the Registered Exchange Offer
open for not less than 30 days and not more than 60 days after
the date notice thereof is mailed to the Holders (or, in each
case, longer if required by applicable law);
(iii) use its reasonable best efforts to
keep the Exchange Offer Registration Statement continuously
effective under the Act, supplemented and amended as required
under the Act, to ensure that it is available for sales of
Exchange Securities by Exchanging Dealers during the Exchange
Offer Registration Period;
(iv) utilize the services of a
depositary for the Registered Exchange Offer with an address
in the Borough of Manhattan in New York City, which may be the
Trustee or an Affiliate of the Trustee;
(v) permit Holders to withdraw tendered
Securities at any time prior to the close of business, New
York time, on the last Business Day on which the Registered
Exchange Offer is open;
(vi) prior to effectiveness of the
Exchange Offer Registration Statement, if requested by the
Commission, provide a supplemental letter to the Commission
(A) stating that the Company and the Subsidiary Guarantors are
conducting the Registered Exchange Offer in reliance on the
position of the Commission in Exxon Capital Holdings
Corporation (pub. avail. May 13, 1988) and Morgan Stanley and
Co., Inc. (pub. avail. June 5, 1991); and (B) including a
representation that neither the Company nor any Subsidiary
Guarantor has entered into any arrangement or understanding
with any Person to distribute the Exchange Securities to be
received in the Registered Exchange Offer and that neither the
Company nor any Subsidiary Guarantor will issue Exchange
Securities to any Holder participating in the Registered
Exchange Offer who fails to certify to the Company that such
Holder is acquiring the Exchange Securities in the ordinary
course of business and has no arrangement or understanding
with any Person to participate in the distribution of the
Exchange Securities; and
(vii) comply in all material respects
with all applicable laws.
(d) As soon as practicable after the close of
the Registered Exchange Offer, the Company and the Subsidiary
Guarantors shall:
(i) accept for exchange all Securities
tendered and not validly withdrawn pursuant to the Registered
Exchange Offer;
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(ii) deliver to the Trustee for
cancellation in accordance with Section 5(s) hereof all
Securities so accepted for exchange; and
(iii) cause the Trustee promptly to
authenticate and deliver to each Holder of Securities a
principal amount of Exchange Securities equal to the principal
amount of the Securities of such Holder so accepted for
exchange.
(e) Each Holder hereby acknowledges and agrees
that any Broker-Dealer and any such Holder using the Registered
Exchange Offer to participate in a distribution of the Exchange
Securities (x) could not under Commission policy as in effect on the
date of this Agreement rely on the position of the Commission in Morgan
Stanley and Co., Inc. (pub. avail. June 5, 1991) and Exxon Capital
Holdings Corporation (pub. avail. May 13, 1988), as interpreted in the
Commission's letter to Shearman & Sterling dated July 2, 1993 and
similar no-action letters; and (y) must comply with the registration
and prospectus delivery requirements of the Act in connection with any
secondary resale transaction which must be covered by an effective
registration statement containing the selling security holder
information required by Item 507 or 508, as applicable, of Regulation
S-K under the Act if the resales are of Exchange Securities obtained by
such Holder in exchange for Securities acquired by such Holder directly
from the Company or one of its Affiliates. Accordingly, each Holder
participating in the Registered Exchange Offer shall be required to
represent to the Company that, at the time of the consummation of the
Registered Exchange Offer:
(i) any Exchange Securities received by
such Holder will be acquired in the ordinary course of
business;
(ii) such Holder has had and will have
no arrangement or understanding with any Person to
participate, and is not participating, in the distribution of
the Securities or the Exchange Securities within the meaning
of the Act; and
(iii) such Holder is not an Affiliate of
the Company or any of the Subsidiary Guarantors (or if it is
such an Affiliate, that it will comply with the registration
and prospectus delivery requirements of the Act to the extent
applicable).
(f) If any Initial Purchaser determines that it
is not eligible to participate in the Registered Exchange Offer with
respect to the exchange of Securities constituting any portion of an
unsold allotment, at the written request of such Initial Purchaser, the
Company and the Subsidiary Guarantors shall issue and deliver to such
Initial Purchaser or the Person purchasing Exchange Securities
registered under a Shelf Registration Statement as contemplated by
Section 3 hereof from such Initial Purchaser, in exchange for such
Securities, a like principal amount of Exchange Securities. The Company
shall use its reasonable best efforts to cause the CUSIP Service Bureau
to issue the same CUSIP number for such Exchange Securities as for
Exchange Securities issued pursuant to the Registered Exchange Offer.
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3. Shelf Registration.
(a) If (i) due to any change in law or
applicable interpretations thereof by the Commission's staff, the
Company determines upon advice of its outside counsel that it or any
Subsidiary Guarantor is not permitted to effect the Registered Exchange
Offer as contemplated by Section 2 hereof; (ii) for any other reason
the Exchange Offer Registration Statement is not declared effective by
the Commission under the Act within 180 days of the date of the
original issuance of the Securities (or if such 180th day is not a
Business Day, the next succeeding Business Day) or the Registered
Exchange Offer is not consummated within 210 days of the date of the
original issuance of the Securities (or if such 210th day is not a
Business Day, the next succeeding Business Day); (iii) any Initial
Purchaser so requests in writing with respect to an unsold allotment of
Securities that are not eligible to be exchanged for Exchange
Securities in the Registered Exchange Offer and that are held by it
following consummation of the Registered Exchange Offer; (iv) any
Holder (other than an Initial Purchaser) is not eligible under
interpretations of the Commission to participate in the Registered
Exchange Offer or does not receive freely tradeable Exchange Securities
in the Registered Exchange Offer, other than by reason of such Holder
being an Affiliate of the Company and the Subsidiary Guarantors (it
being understood that the requirement that a participating
Broker-Dealer deliver the prospectus contained in the Exchange Offer
Registration Statement in connection with sales of Exchange Securities
shall not result in such Exchange Securities being not "freely
tradable"); or (v) in the case of any Initial Purchaser that
participates in the Registered Exchange Offer, such Initial Purchaser
does not receive freely tradeable Exchange Securities in exchange for
Securities constituting any portion of an unsold allotment, other than
by reason of such Holder being an Affiliate of the Company (it being
understood that (x) the requirement that an Initial Purchaser deliver a
Prospectus containing the information required by Item 507 or 508 of
Regulation S-K under the Act in connection with sales of Exchange
Securities acquired in exchange for such Securities shall not result in
such Exchange Securities being not "freely tradeable;" and (y) the
requirement that an Exchanging Dealer deliver a Prospectus in
connection with sales of Exchange Securities acquired in the Registered
Exchange Offer in exchange for Securities acquired as a result of
market-making activities or other trading activities shall not result
in such Exchange Securities being not "freely tradeable"), the Company
shall use its reasonable best efforts to effect, at its cost, a Shelf
Registration Statement in accordance with subsection (b) below.
(b) The Company shall as promptly as practicable
(but in no event more than 90 days after so required pursuant to
Section 3(a) or requested pursuant to this Section 3, or if such 90th
day is not a Business Day, the next succeeding Business Day), file with
the Commission and thereafter shall use its reasonable best efforts to
cause to be declared effective under the Act a Shelf Registration
Statement relating to the offer and sale of the Securities or the
Exchange Securities, as applicable, by the Holders thereof from time to
time in accordance with the methods of distribution elected by such
Holders and set forth in such Shelf Registration Statement; provided,
however, that no Holder (other than an Initial Purchaser) shall be
entitled to have the Securities held by it covered by such Shelf
Registration Statement unless such Holder agrees in writing to be bound
by all of the provisions of this Agreement applicable to such Holder;
and provided, further,
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that with respect to Exchange Securities received by an Initial
Purchaser in exchange for Securities constituting any portion of an
unsold allotment, the Company may, if permitted by current
interpretations by the Commission's staff, file a post-effective
amendment to the Exchange Offer Registration Statement containing the
information required by Item 507 or 508 of Regulation S-K, as
applicable, in satisfaction of its obligations under this subsection
with respect thereto, and any such Exchange Offer Registration
Statement, as so amended, shall be referred to herein as, and governed
by the provisions herein applicable to, a Shelf Registration Statement.
(i) The Company shall use its
reasonable best efforts to keep the Shelf Registration
Statement continuously effective, supplemented and amended as
required by the Act, in order to permit the Prospectus forming
part thereof to be usable by Holders for a period of two years
from the date the Shelf Registration Statement is declared
effective by the Commission (or for such longer period if
extended pursuant to Section 5(k) hereof) or such shorter
period that will terminate when all the Securities or Exchange
Securities, as applicable, covered by the Shelf Registration
Statement have been sold pursuant to the Shelf Registration
Statement or, if earlier, the date on which the Securities
become eligible for resale pursuant to Rule 144(k) under the
Act (in any such case, such period being called the "Shelf
Registration Period"). The Company shall be deemed not to have
used its reasonable best efforts to keep the Shelf
Registration Statement effective during the requisite period
if it voluntarily takes any action that would result in
Holders of Securities covered thereby not being able to offer
and sell such Securities during that period, unless (A) such
action is required by applicable law; or (B) such action is
taken by the Company in good faith and for valid business
reasons (not including avoidance of the Company's obligations
hereunder), including the acquisition or divestiture of assets
(to the extent permitted by the terms of the Indenture), so
long as the Company promptly thereafter complies with the
requirements of Section 5(k) hereof, if applicable.
4. Special Interest. If (a) on or prior to the 90th day
following the original issue date of the Securities (or if such 90th day is not
a Business Day, the next succeeding Business Day), neither the Exchange Offer
Registration Statement nor the Shelf Registration Statement has been filed with
the Commission, (b) on or prior to the 180th day following the original issue
date of the Securities (or if such 180th day is not a Business Day, the next
succeeding Business Day), neither the Exchange Offer nor the Shelf Registration
Statement has been declared effective by the Commission, (c) on or prior to the
210th day following the original issue date of the Securities (or if such 210th
day is not a Business Day the next succeeding Business Day), neither has the
Registered Exchange Offer been consummated nor has the Shelf Registration
Statement been declared effective, or (d) after either the Exchange Offer
Registration Statement or the Shelf Registration Statement has been declared
effective, such Registration Statement thereafter ceases to be effective or
usable in connection with resales of Securities or Exchange Securities in
accordance with and during the periods specified in this Agreement (each such
event referred to in clauses (a) through (d), a "Registration Default"), then
interest ("Special Interest") shall accrue on the principal amount of the
Securities and the Exchange Securities (in addition to the stated interest on
the Securities and Exchange Securities) from and including the date on which any
such Registration Default shall have occurred to but excluding the date on
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which all Registration Defaults have been cured. Special Interest shall accrue
at a rate of 0.25% per annum during the 90-day period immediately following the
occurrence of such Registration Default and shall increase by 0.25% per annum at
the end of each subsequent 90-day period, but in no event shall such rate exceed
1.00% per annum.
All obligations of the Company and the Subsidiary Guarantors
set forth in the preceding paragraph that are outstanding with respect to any
Security at the time such Security is exchanged for an Exchange Security shall
survive until such time as all such obligations with respect to such Security
have been satisfied in full.
The parties hereto agree that the Special Interest provided
for in this Section 4 constitutes a reasonable estimate of the damages that will
be suffered by Holders of Securities by reason of a Registration Default.
5. Additional Registration Procedures. In connection
with any Shelf Registration Statement and, to the extent applicable, any
Exchange Offer Registration Statement, the following provisions shall apply.
(a) The Company shall:
(i) furnish to you or the counsel
designated by you pursuant to Section 5(q)(1), not less than
five Business Days prior to the filing thereof with the
Commission, a copy of any Exchange Offer Registration
Statement and any Shelf Registration Statement, and each
amendment thereof and each amendment or supplement, if any, to
the Prospectus included therein (including, upon written
request, all documents incorporated by reference therein after
the initial filing) and shall use its reasonable best efforts
to reflect in each such document, when so filed with the
Commission, such comments as you reasonably propose;
(ii) include the information
substantially as set forth in Annex A hereto in the Exchange
Offer Registration Statement, in Annex B hereto in the
Exchange Offer Registration Statement in a section setting
forth details of the Exchange Offer, in Annex C hereto in the
underwriting or plan of distribution section of the Prospectus
contained in the Exchange Offer Registration Statement, and in
Annex D hereto in the letter of transmittal delivered pursuant
to the Registered Exchange Offer, in each case subject to any
changes, additions, deletions or moving of such disclosure
required by the Commission;
(iii) if requested by an Initial
Purchaser, include the information required by Item 507 or 508
of Regulation S-K, as applicable, in the Prospectus contained
in the Exchange Offer Registration Statement; and
(iv) in the case of a Shelf Registration
Statement, include the names of the Holders that propose to
sell Securities pursuant to the Shelf Registration Statement
as selling security holders.
(b) The Company shall ensure that:
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(i) other than with respect to
information included therein in reliance upon or in conformity
with written information furnished to the Company by or on
behalf of any Holder specifically for use therein, any
Registration Statement and any amendment thereto and any
Prospectus forming part thereof and any amendment or
supplement thereto complies in all material respects with the
Act and the rules and regulations thereunder; and
(ii) other than with respect to
information included therein in reliance upon or in conformity
with written information furnished to the Company by or on
behalf of any Holder specifically for use therein, any
Registration Statement and any amendment thereto and any
Prospectus forming part thereof and any amendment or
supplement thereto does not, when the Registration Statement
becomes effective, 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 (in the
case of the Prospectus, in the light of the circumstances
under which they were made) not misleading.
(c) The Company shall advise you, the Holders of
Securities covered by any Shelf Registration Statement and any
Exchanging Dealer under any Exchange Offer Registration Statement in
each case that has provided in writing to the Company a telephone or
facsimile number and address for notices, and, if requested by you or
any such Holder or Exchanging Dealer, shall confirm such advice in
writing to such requesting person (which notice pursuant to clauses
(ii) through (v) hereof shall be accompanied by an instruction to
suspend the use of the Prospectus until the Company shall have remedied
the basis for such suspension):
(i) when a Registration Statement
(exclusive of any material incorporated by reference therein)
or any amendment thereto has been filed with the Commission
and when the Registration Statement or any post-effective
amendment thereto has become effective;
(ii) of any request by the Commission
for any amendment or supplement to the Registration Statement
or the Prospectus or for additional information;
(iii) if known to the Company, of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the initiation
of any proceedings for that purpose;
(iv) if known to the Company, of the
receipt by the Company or the Subsidiary Guarantors of any
notification with respect to the suspension of the
qualification of the Securities or the Exchange Securities, as
the case may be, included therein for sale in any jurisdiction
or the initiation of any proceeding for such purpose; and
(v) of the happening of any event that
requires any change in the Registration Statement or the
Prospectus so that, as of such date, the
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Registration Statement or the Prospectus does not contain an
untrue statement of a material fact and does not omit to state
a material fact required to be stated therein or necessary to
make the statements therein (in the case of the Prospectus, in
the light of the circumstances under which they were made) not
misleading.
(d) The Company shall use its reasonable best
efforts to obtain the withdrawal of any order suspending the
effectiveness of any Registration Statement or the qualification of the
securities therein for sale in any jurisdiction at the earliest
possible time.
(e) The Company shall furnish upon written
request to each Holder so requesting of Securities covered by any Shelf
Registration Statement, without charge, at least one copy of such Shelf
Registration Statement and any post-effective amendment thereto,
including all material incorporated therein by reference, and, if the
Holder so requests in writing, all exhibits thereto (including exhibits
incorporated by reference therein).
(f) The Company shall, during the Shelf
Registration Period, deliver to each Holder of Securities covered by
any Shelf Registration Statement, without charge, as many copies of the
Prospectus (including each preliminary Prospectus) included in such
Shelf Registration Statement and any amendment or supplement thereto as
such Holder may reasonably request in writing. The Company and the
Subsidiary Guarantors consent to the use of the Prospectus or any
amendment or supplement thereto by each of the selling Holders of
Securities in connection with the offering and sale of the Securities
covered by the Prospectus, or any amendment or supplement thereto,
included in the Shelf Registration Statement in accordance with the
plan of distribution set forth in the applicable Prospectus.
(g) The Company shall furnish to each Exchanging
Dealer which so requests in writing, without charge, at least one copy
of the Exchange Offer Registration Statement and any post-effective
amendment thereto, including all material incorporated by reference
therein, and, if the Exchanging Dealer so requests in writing, all
exhibits thereto (including exhibits incorporated by reference
therein).
(h) The Company shall promptly deliver to each
Initial Purchaser, and each Exchanging Dealer required to deliver a
Prospectus during the Exchange Offer Registration Period, without
charge, as many copies of the final Prospectus included in such
Exchange Offer Registration Statement and any amendment or supplement
thereto as any such Person may reasonably request in writing. The
Company and the Subsidiary Guarantors consent to the use of the
Prospectus or any amendment or supplement thereto by any Initial
Purchaser and any Exchanging Dealer that may be required to deliver a
Prospectus following the Registered Exchange Offer in connection with
the offering and sale of the Exchange Securities covered by the
Prospectus, or any amendment or supplement thereto, included in the
Exchange Offer Registration Statement in accordance with the plan of
distribution set forth in the applicable Prospectus.
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(i) Prior to the Registered Exchange Offer or
any other offering of Securities or Exchange Securities pursuant to any
Registration Statement, the Company and the Subsidiary Guarantors shall
use their reasonable best efforts to arrange, if necessary, for the
qualification of the Securities or the Exchange Securities for sale
under the state securities or blue sky laws of such jurisdictions as
any Holder shall reasonably request and will maintain such
qualification in effect so long as required; provided that in no event
shall either the Company or any Subsidiary Guarantor be obligated to
qualify to do business or as a dealer in securities in any jurisdiction
where it is not then so qualified or to take any action that would
subject it to service of process in suits or taxation in any such
jurisdiction where it is not then so subject.
(j) The Company and the Subsidiary Guarantors
shall cooperate with the Holders to facilitate the transfer by book
entry of, or the timely preparation and delivery of certificates
representing, Exchange Securities or Securities to be issued or sold
pursuant to any Registration Statement free of any restrictive legends
and in such amounts and in such names as Holders may reasonably
request.
(k) Upon the occurrence of any event
contemplated by subsections (c)(ii) through (v) above during any period
of time in which the Company is required to maintain an effective
Registration Statement, the Company shall promptly prepare a
post-effective amendment to the applicable Registration Statement or an
amendment or supplement to the related Prospectus or file any other
required document so that, as thereafter delivered to Initial
Purchasers of the securities included therein, the Prospectus shall not
include an untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading. In such
circumstances, the period of effectiveness of the Exchange Offer
Registration Statement provided for in Section 2 and the Shelf
Registration Statement provided for in Section 3(b) shall each be
extended by the number of days from and including the date of the
giving of a notice of suspension pursuant to Section 5(c) hereof to and
including the date when the Initial Purchasers, the Holders of the
Securities and any known Exchanging Dealer shall have received such
amended or supplemented Prospectus pursuant to this Section 5(k).
(l) Not later than the effective date of any
Registration Statement, the Company shall provide a CUSIP number for
the Exchange Securities registered under such Registration Statement
and provide the Trustee with printed certificates for such Exchange
Securities in a form eligible for deposit with The Depository Trust
Company.
(m) The Company shall comply in all material
respects with all applicable rules and regulations of the Commission
and shall make generally available to its security holders within the
time limits prescribed by the Commission, an earnings statement
satisfying the provisions of Section 11(a) of the Act.
(n) The Company shall cause the Indenture to be
qualified under the Trust Indenture Act as required by applicable law
in a timely manner.
12
(o) The Company may require each Holder of
Securities to be sold pursuant to any Shelf Registration Statement to
furnish to the Company such information regarding the Holder and the
distribution of such Securities as the Company may from time to time
reasonably require for inclusion in such Shelf Registration Statement.
The Company may exclude from such Shelf Registration Statement the
Securities of any Holder that fails to furnish such information within
a reasonable time after receiving such request.
(p) In the case of any Shelf Registration
Statement, the Company and the Subsidiary Guarantors shall enter into
such agreements and take all other appropriate actions (including if an
underwriter is engaged, entering into an underwriting agreement) in
order to expedite or facilitate the registration or the disposition of
the Securities, and in connection therewith, if an underwriting
agreement is entered into, cause the same to contain indemnification
provisions and procedures no less favorable than those set forth in
Section 7 (or such other provisions and procedures acceptable to the
Majority Holders and the Managing Underwriters, if any) with respect to
all parties to be indemnified pursuant to Section 7.
(q) In the case of any Shelf Registration
Statement, the Company and the Subsidiary Guarantors shall:
(i) make reasonably available for
inspection by the Holders of a majority of the Securities to
be registered thereunder, any underwriter participating in any
disposition pursuant to such Shelf Registration Statement, and
any attorney, accountant or other agent retained by such
Holders or any such underwriter all relevant financial and
other records, pertinent corporate documents and properties of
the Company and its subsidiaries; provided, however, that the
foregoing inspection and information gathering shall be
coordinated on behalf of the Initial Purchasers by Citigroup
Global Markets Inc. in connection with any underwritten Shelf
Registration Statement for which it is acting as an
underwriter and on behalf of the Holders by one counsel
designated by the Holders of a majority of the Securities to
be registered; provided, further, that any information that is
designated in writing by the Company or any Subsidiary
Guarantor, in good faith, as confidential at the time of
delivery of such information shall be kept confidential by the
Holders or any such underwriter, attorney, accountant or
agent, unless such disclosure is made in connection with a
court proceeding or required by law, or such information
becomes available to the public generally or through a third
party without an accompanying obligation of confidentiality;
and, if the Company is advised by its outside securities
counsel that providing any such information to a Holder would
result in the Company being required to disclose such
information pursuant to Regulation FD, then as a condition to
providing such information, such Holder will expressly agree
in writing to comply with the foregoing;
(ii) cause the Company's and the
Subsidiary Guarantors' officers, directors and employees to
supply all relevant information reasonably requested by the
Holders or any underwriter, attorney, accountant or agent in
13
connection with any such Shelf Registration Statement as is
customary for similar due diligence examinations; provided,
however, that the foregoing inspection and information
gathering shall be coordinated on behalf of the Initial
Purchasers by Citigroup Global Markets Inc. in connection with
any underwritten Shelf Registration Statement for which it is
acting as an underwriter, and on behalf of the Holders by one
counsel designated by the Holders of a majority of the
Securities to be registered; provided, further, that any
information that is designated in writing by the Company, in
good faith, as confidential at the time of delivery of such
information shall be kept confidential by the Holders or any
such underwriter, attorney, accountant or agent, unless such
disclosure is made in connection with a court proceeding or
required by law, or such information becomes available to the
public generally or through a third party without an
accompanying obligation of confidentiality; and, if the
Company is advised by its outside securities counsel that
providing any such information to a Holder would result in the
Company being required to disclose such information pursuant
to Regulation FD, then as a condition to providing such
information, such Holder will expressly agree in writing to
comply with the foregoing;
(iii) in connection with an underwritten
offering or if requested by the Holders of a majority of the
Securities to be registered pursuant to such Shelf
Registration Statement, make such representations and
warranties to the Holders of Securities registered thereunder
and the underwriters, if any, in form, substance and scope as
are customarily made by issuers to underwriters in primary
underwritten offerings and covering matters including, but not
limited to, those set forth in the Purchase Agreement;
(iv) in connection with an underwritten
offering or if requested by the Holders of a majority of the
Securities to be registered pursuant to such Shelf
Registration Statement, obtain opinions of counsel to the
Company and updates thereof (which counsel and opinions (in
form, scope and substance) shall be reasonably satisfactory to
the Managing Underwriters, if any) addressed to each selling
Holder and the underwriters, if any, covering such matters as
are customarily covered in opinions requested in underwritten
offerings and such other matters as may be reasonably
requested by such Holders and underwriters;
(v) in connection with an underwritten
offering or if requested by the Holders of a majority of the
Securities to be registered pursuant to such Shelf
Registration Statement, use its reasonable best efforts to
obtain "cold comfort" letters and updates thereof from the
independent certified public accountants of the Company (and,
if necessary, any other independent certified public
accountants of any subsidiary of the Company or of any
business acquired by the Company for which financial
statements and financial data are, or are required to be,
included in such Shelf Registration Statement), addressed to
each selling Holder of Securities registered thereunder and
the underwriters, if any, in customary form and covering
matters of the type customarily covered in "cold comfort"
letters in connection with primary underwritten offerings; and
14
(vi) deliver such documents and
certificates as may be reasonably requested by the Majority
Holders and the Managing Underwriters, if any, including those
to evidence compliance with Section 5(k) and with any
customary conditions contained in the underwriting agreement
or other agreement entered into by the Company and the
Subsidiary Guarantors.
The actions set forth in clauses (iii), (iv), (v) and (vi) of this
Section 5(q) shall be performed at (A) the effectiveness of such
Registration Statement and each post-effective amendment thereto; and
(B) each closing under any underwriting or similar agreement as and to
the extent required thereunder.
(r) In the case of any Exchange Offer
Registration Statement, the Company and the Subsidiary Guarantors
shall, if requested in writing by the Majority Holders:
(i) make reasonably available for
inspection by any Initial Purchaser, and any attorney,
accountant or other agent retained by such Initial Purchaser,
all relevant financial and other records, pertinent corporate
documents and properties of the Company and its subsidiaries;
provided, however, that the foregoing inspection and
information gathering shall be coordinated on behalf of the
Initial Purchasers by Citigroup Global Markets Inc., and on
behalf of the Holders by one counsel designated by the
Majority Holders; provided, however, that any information that
is designated in writing by the Company or any Subsidiary
Guarantor, in good faith, as confidential at the time of
delivery of such information shall be kept confidential by
such Initial Purchaser or any such attorney, accountant or
agent, unless such disclosure is made in connection with a
court proceeding or required by law, or such information
becomes available to the public generally or through a third
party without an accompanying obligation of confidentiality;
(ii) cause the Company and the
Subsidiary Guarantors' officers, directors and employees to
supply all relevant information reasonably requested by such
Initial Purchaser or any such attorney, accountant or agent in
connection with any such Exchange Offer Registration Statement
as is customary for similar due diligence examinations;
provided, however, that the foregoing inspection and
information gathering shall be coordinated on behalf of the
Initial Purchasers by Citigroup Global Markets Inc., and on
behalf of the Holders by one counsel designated by the
Majority Holders; provided, further, that any information that
is designated in writing by the Company, in good faith, as
confidential at the time of delivery of such information shall
be kept confidential by such Initial Purchaser or any such
attorney, accountant or agent, unless such disclosure is made
in connection with a court proceeding or required by law, or
such information becomes available to the public generally or
through a third party without an accompanying obligation of
confidentiality;
(iii) make such representations and
warranties to such Initial Purchaser, in form, substance and
scope as are customarily made by issuers to
15
underwriters in primary underwritten offerings and covering
matters including, but not limited to, those set forth in the
Purchase Agreement;
(iv) obtain opinions of counsel to the
Company or any Subsidiary Guarantor and updates thereof (which
counsel and opinions (in form, scope and substance) shall be
reasonably satisfactory to such Initial Purchaser and its
counsel), addressed to such Initial Purchaser, covering such
matters as are customarily covered in opinions requested in
underwritten offerings and such other matters as may be
reasonably requested by such Initial Purchaser or its counsel;
(v) use its reasonable best efforts to
obtain "cold comfort" letters and updates thereof from the
independent certified public accountants of the Company (and,
if necessary, any other independent certified public
accountants of any subsidiary of the Company or of any
business acquired by the Company for which financial
statements and financial data are, or are required to be,
included in such Exchange Offer Registration Statement),
addressed to such Initial Purchaser, in customary form and
covering matters of the type customarily covered in "cold
comfort" letters in connection with primary underwritten
offerings, or if requested by such Initial Purchaser or its
counsel in lieu of a "cold comfort" letter, an agreed-upon
procedures letter under Statement on Auditing Standards No.
35, covering matters requested by such Initial Purchaser or
its counsel; and
(vi) deliver such documents and
certificates as may be reasonably requested by such Initial
Purchaser or its counsel, including those to evidence
compliance with Section 5(k) and with conditions customarily
contained in underwriting agreements.
The foregoing actions set forth in clauses (iii), (iv), (v), and (vi)
of this Section 5(r) shall be performed at the close of the Registered
Exchange Offer and the effective date of any post-effective amendment
to the Exchange Offer Registration Statement.
(s) If a Registered Exchange Offer is to be
consummated, upon delivery of the Securities by Holders to the Company
(or to such other Person as directed by the Company) in exchange for
the Exchange Securities, the Company shall mark, or caused to be
marked, on the Securities so exchanged that such Securities are being
canceled in exchange for the Exchange Securities. In no event shall the
Securities be marked as paid or otherwise satisfied.
(t) The Company will use its reasonable best
efforts (i) if the Securities have been rated prior to the initial sale
of such Securities, to confirm such ratings will apply to the
Securities or the Exchange Securities, as the case may be, covered by a
Registration Statement; or (ii) if the Securities were not previously
rated, to cause the Securities or the Exchange Securities covered by a
Registration Statement to be rated with at least one nationally
recognized statistical rating agency, if so requested by
16
the Majority Holders with respect to the related Registration Statement
or by any Managing Underwriters.
(u) In the event that any Broker-Dealer shall
underwrite any Securities or participate as a member of an underwriting
syndicate or selling group or "assist in the distribution" (within the
meaning of the Rules of Fair Practice and the By-Laws of the National
Association of Securities Dealers, Inc.) thereof, whether as a Holder
of such Securities or as an underwriter, a placement or sales agent or
a broker or dealer in respect thereof, or otherwise, the Company and
the Subsidiary Guarantors shall assist such Broker-Dealer in complying
with the requirements of such Rules and By-Laws, including, without
limitation, by:
(i) if such Rules or By-Laws shall so
require, engaging a "qualified independent underwriter" (as
defined in such Rules) to participate in the preparation of
the Registration Statement, to exercise usual standards of due
diligence with respect thereto and, if any portion of the
offering contemplated by such Registration Statement is an
underwritten offering or is made through a placement or sales
agent, to recommend the yield of such Securities;
(ii) indemnifying any such qualified
independent underwriter to the extent of the indemnification
of underwriters provided in Section 7 hereof; and
(iii) providing such information to such
Broker-Dealer as may be required in order for such
Broker-Dealer to comply with the requirements of such Rules.
(v) Notwithstanding the foregoing, in the event
of a potential acquisition or business combination or other
transaction, business development or event involving the Company that
may require disclosure in a Registration Statement, and the Company
shall determine in the exercise of its reasonable judgment that
disclosure of such potential acquisition or business combination or
other transaction, business development or event is not in the best
interests of the Company and its stockholders or that obtaining any
financial statements relating to an acquisition or business combination
required to be included in such Registration Statement would be
impracticable, the Company and the Subsidiary Guarantors shall have the
right to suspend the effectiveness of a Registration Statement for no
more than two periods, each of up to 45 consecutive days (each a
"Suspension Period"), during any 365-day period, provided that no
Registration Statement may be suspended for more than an aggregate of
75 days in any twelve-month period. In any such event, the Company
shall promptly notify any Exchanging Dealer of the suspension of the
effectiveness of such Registration Statement, provided that the Company
shall not be required to disclose in such notice the possible
acquisition or business combination or other transaction, business
development or event if it determines in good faith that such
disclosure would not be in the best interests of the Company and its
stockholders. Any Special Interest payable pursuant to Section 4 shall
continue to accrue and be payable during any Suspension Period. Any
Suspension Period shall terminate upon the later of (i) the
abandonment, consummation or termination of
17
such acquisition or business combination or other transaction, business
development or event or the availability of the required financial
statements with respect to a possible acquisition or business
combination and (ii) any required amendment or supplement to the
Registration Statement, and the Company shall promptly notify
Exchanging Dealers that the use of the Prospectus contained in the
Registration Statement, as amended or supplemented, may resume. The
Company shall provide sufficient copies of the most recent version of
such Prospectus to Exchanging Dealers promptly upon written request,
and in no event later than one business day after such request.
6. Registration Expenses. The Company and the Subsidiary
Guarantors shall bear all expenses incurred in connection with the performance
of their obligations under Sections 2, 3 and 5 hereof and, in the event of any
Shelf Registration Statement, will reimburse the Holders for the reasonable fees
and disbursements of one firm or counsel designated by the Majority Holders to
act as counsel for the Holders in connection therewith.
7. Indemnification and Contribution.
(a) The Company and the Subsidiary Guarantors,
jointly and severally, agree to indemnify and hold harmless each Holder
of Securities or Exchange Securities, as the case may be, covered by
any Registration Statement (including each Initial Purchaser and, with
respect to any Prospectus delivery as contemplated in Section 5(h)
hereof, each Exchanging Dealer), the directors, officers, employees and
agents of each such Holder and each Person who controls any such Holder
within the meaning of either the Act or the Exchange Act against any
and all losses, claims, damages or liabilities, joint or several, to
which they or any of them may become subject under the Act, the
Exchange Act or other Federal or state statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of a material
fact contained in the Registration Statement as originally filed or in
any amendment thereof, or in any preliminary Prospectus or the
Prospectus, or in any amendment thereof or supplement thereto, or arise
out of or are based upon the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, and agrees to reimburse
each such indemnified party, as incurred, for any legal or other
expenses reasonably incurred by that indemnified party in connection
with investigating or defending any such loss, claim, damage, liability
or action; provided, however, that the Company and the Subsidiary
Guarantors will not be liable in any case to the extent that any such
loss, claim, damage or liability arises out of or is based upon any
such untrue statement or alleged untrue statement or omission or
alleged omission made therein in reliance upon and in conformity with
written information furnished to the Company and the Subsidiary
Guarantors by or on behalf of any such Holder specifically for
inclusion therein. This indemnity agreement will be in addition to any
liability which the Company and the Subsidiary Guarantors may otherwise
have.
The Company and the Subsidiary Guarantors also, jointly and
severally, agree to indemnify or contribute as provided in Section 7(d)
to Losses of any underwriter of any Securities or Exchange Securities,
as the case may be, registered under a Shelf
18
Registration Statement, their directors, officers, employees or agents
and each Person who controls such underwriter (within the meaning of
the Act or the Exchange Act) on substantially the same basis as that of
the indemnification of the Initial Purchasers and the selling Holders
provided in this Section 7(a) and shall, if requested by any Holder,
enter into an underwriting agreement reflecting such agreement, as
provided in Section 5(p) hereof.
(b) Each Holder of Securities or Exchange
Securities, as the case may be, covered by a Registration Statement
(including each Initial Purchaser and, with respect to any Prospectus
delivery as contemplated in Section 5(h) hereof, each Exchanging
Dealer) severally agrees to indemnify and hold harmless the Company and
the Subsidiary Guarantors, each of their Affiliates, each of their
directors, each of their officers who signs such Registration Statement
and each Person who controls the Company or any of the Subsidiary
Guarantors within the meaning of either the Act or the Exchange Act, to
the same extent as the foregoing indemnity from the Company and the
Subsidiary Guarantors to each such Holder, but only with reference to
written information furnished to the Company or the Subsidiary
Guarantors by or on behalf of such Holder specifically for inclusion in
the documents referred to in the foregoing indemnity, and agrees to
reimburse each such indemnified party, as incurred, for any legal or
other expenses reasonably incurred by that indemnified party in
connection with investigating or defending any such loss, claim,
damage, liability or action. This indemnity agreement will be in
addition to any liability which any such Holder may otherwise have.
(c) Promptly after receipt by an indemnified
party under this Section 7 of notice of any claim or the commencement
of any action, such indemnified party will, if a claim in respect
thereof is to be made against the indemnifying party under this Section
7, notify the indemnifying party in writing of the commencement
thereof; but the failure so to notify the indemnifying party (i) will
not relieve it from liability under paragraph (a) or (b) above unless
and to the extent it did not otherwise learn of such action and such
failure results in the forfeiture by the indemnifying party of
substantial rights and defenses; and (ii) will not, in any event,
relieve the indemnifying party from any obligations to any indemnified
party other than the indemnification obligation provided in paragraph
(a) or (b) above. The indemnifying party shall be entitled to appoint
counsel of the indemnifying party's choice at the indemnifying party's
expense to represent the indemnified party in any action for which
indemnification is sought (in which case the indemnifying party shall
not thereafter be responsible for the fees and expenses of any separate
counsel retained by the indemnified party or parties except as set
forth below); provided, however, that such counsel shall be reasonably
satisfactory to the indemnified party. Notwithstanding the indemnifying
party's election to appoint counsel to represent the indemnified party
in an action, the indemnified party shall have the right to employ
separate counsel (including local counsel), and the indemnifying party
shall bear the reasonable fees, costs and expenses of such separate
counsel if (i) the use of counsel chosen by the indemnifying party to
represent the indemnified party would present such counsel with a
conflict of interest; (ii) the actual or potential defendants in, or
targets of, any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably
concluded that there may be legal
19
defenses available to it and/or other indemnified parties which are
different from or additional to those available to the indemnifying
party; (iii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified
party within a reasonable time after notice of the institution of such
action; or (iv) the indemnifying party shall authorize the indemnified
party to employ separate counsel at the expense of the indemnifying
party. An indemnifying party will not, without the prior written
consent of the indemnified parties (which consent shall not be
unreasonably withheld), settle or compromise or consent to the entry of
any judgment with respect to any pending or threatened claim, action,
suit or proceeding in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified parties are
actual or potential parties to such claim or action) unless such
settlement, compromise or consent includes an unconditional release of
each indemnified party from all liability arising out of such claim,
action, suit or proceeding.
(d) In the event that the indemnity provided in
paragraph (a) or (b) of this Section 7 is unavailable to or
insufficient to hold harmless an indemnified party for any reason, then
each applicable indemnifying party shall have a joint and several
obligation to contribute to the amount paid or payable by such
indemnified party as a result of the aggregate losses, claims, damages
and liabilities referred to in subsection (a) or (b), as the case may
be, above, (including legal or other expenses reasonably incurred in
connection with investigating or defending same) (collectively
"Losses") to which such indemnified party may be subject in such
proportion as is appropriate to reflect the relative benefits received
by such indemnifying party, on the one hand, and such indemnified
party, on the other hand, from the Initial Placement and the
Registration Statement which resulted in such Losses; provided,
however, that in no case shall any Initial Purchaser or any subsequent
Holder of any Security or Exchange Security be obligated to contribute
in accordance with this paragraph (d) an amount, in the aggregate, in
excess of the purchase discount or commission applicable to such
Security, or in the case of an Exchange Security, applicable to the
Security that was exchangeable into such Exchange Security, nor shall
any underwriter be obligated to contribute in accordance with this
paragraph (d) an amount in excess of the underwriting discount or
commission applicable to the securities purchased by such underwriter
under the Registration Statement which resulted in such Losses. If the
allocation provided by the immediately preceding sentence is
unavailable for any reason, the indemnifying party and the indemnified
party shall contribute in such proportion as is appropriate to reflect
not only such relative benefits but also the relative fault of such
indemnifying party, on the one hand, and such indemnified party, on the
other hand, in connection with the statements or omissions which
resulted in such Losses as well as any other relevant equitable
considerations. Benefits received by the Company and the Subsidiary
Guarantors shall be deemed to be equal to the sum of the total net
proceeds from the Initial Placement (before deducting expenses).
Benefits received by the Initial Purchasers shall be deemed to be equal
to the total purchase discounts and commissions received, and benefits
received by any other Holders shall be deemed to be equal to the
proceeds received from the sale of the Securities or Exchange
Securities, as applicable. Benefits received by any underwriter shall
be deemed to be equal to the total underwriting discounts and
commissions received. Relative fault shall be determined by reference
to, among other things, whether any alleged untrue statement or
omission relates to information provided
20
by the indemnifying party, on the one hand, or by the indemnified
party, on the other hand, the intent of the parties and their relative
knowledge, access to information and opportunity to correct or prevent
such untrue statement or omission. The parties agree that it would not
be just and equitable if contribution were determined by pro rata
allocation (even if the Holders were treated as one entity for such
purpose) or any other method of allocation which does not take account
of the equitable considerations referred to above. Notwithstanding the
provisions of this paragraph (d), no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act)
shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. For purposes of this Section 7, each
person who controls a Holder within the meaning of either the Act or
the Exchange Act and each director, officer, employee and agent of such
Holder shall have the same rights to contribution as such Holder, and
each person who controls either the Company or any of the Subsidiary
Guarantors within the meaning of either the Act or the Exchange Act,
each officer of the Company or any of the Subsidiary Guarantors who
shall have signed the Registration Statement and each director of the
Company or any of the Subsidiary Guarantors shall have the same rights
to contribution as the Company, subject in each case to the applicable
terms and conditions of this paragraph (d).
(e) The provisions of this Section 7 will remain
in full force and effect, regardless of any investigation made by or on
behalf of any Holder or the Company and the Subsidiary Guarantors or
any of the officers, directors or controlling persons referred to in
this Section 7, and will survive the sale by a Holder of Securities or
Exchange Securities covered by a Registration Statement.
8. Underwritten Registrations.
(a) If any of the Securities or Exchange
Securities, as the case may be, covered by any Shelf Registration
Statement are to be sold in an underwritten offering, the Managing
Underwriters shall be selected by the Majority Holders.
(b) No person may participate in any
underwritten offering pursuant to any Shelf Registration Statement,
unless such person (i) agrees to sell such Person's Securities or
Exchange Securities, as the case may be, on the basis reasonably
provided in any underwriting arrangements approved by the persons
entitled hereunder to approve such arrangements; and (ii) completes and
executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents reasonably required under
the terms of such underwriting arrangements.
9. No Inconsistent Agreements. The Company and the
Subsidiary Guarantors have not, as of the date hereof, entered into, nor shall
they, 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 herein or
otherwise conflicts with the provisions hereof.
10. Amendments and Waivers. The provisions of this
Agreement, including the provisions of this sentence, may not be amended,
qualified, modified or supplemented, and waivers or consents to departures from
the provisions hereof may not be given, except by the
21
Company and the written consent of the Majority Holders (or, after the
consummation of any Registered Exchange Offer in accordance with Section 2
hereof, holders of a majority in aggregate principal amount outstanding of
Exchange Securities); provided that, with respect to any matter that directly or
indirectly 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 for the foregoing proviso), a waiver or
consent to departure from the provisions hereof with respect to a matter that
relates exclusively to the rights of Holders whose Securities or Exchange
Securities, as the case may be, are being sold pursuant to a Registration
Statement and that does not directly or indirectly affect the rights of other
Holders may be given by the Holders representing a majority of the aggregate
principal amount of the Securities being so sold, voting together as a single
class. The Company may consent to any amendment or waiver of this Agreement on
behalf of the Subsidiary Guarantors.
11. Notices. All notices and other communications
provided for or permitted hereunder shall be made in writing by hand-delivery,
first-class mail, facsimile transmission or air courier guaranteeing next day
delivery:
(a) if to a Holder, at the most current address
given by such holder to the Company in accordance with the provisions
of this Section, which address initially is, with respect to each
Holder, the address of such Holder maintained by the Registrar under
the Indenture, with a copy in like manner to Citigroup Global Markets
Inc.;
if to you, initially at the respective addresses set forth in the Purchase
Agreement; and
(b) if to the Company or the Subsidiary
Guarantors, initially at the address of the Company set forth in the
Purchase Agreement.
All such notices and communications shall be deemed to have
been duly given when received.
The Initial Purchasers, the Company or the Subsidiary
Guarantors by notice to the other parties may designate additional or different
addresses for subsequent notices or communications.
12. Successors. This Agreement shall inure to the benefit
of and be binding upon the successors and assigns of each of the parties,
including, without the need for an express assignment or any consent by the
Company thereto, subsequent Holders of Securities and the Exchange Securities.
The Company hereby agrees to extend the benefits of this Agreement to any Holder
of Securities and the Exchange Securities, and any such Holder may specifically
enforce the provisions of this Agreement as if an original party hereto.
13. Counterparts. This Agreement may be in signed
counterparts, each of which shall an original and all of which together shall
constitute one and the same agreement.
14. Headings. The headings used herein are for
convenience only and shall not affect the construction hereof.
22
15. Applicable Law. This Agreement shall be governed by
and construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed in the State of New York.
16. Severability. In the event that any one or more of
the provisions contained herein, or the application thereof in any
circumstances, is held invalid, illegal or unenforceable in any respect for any
reason, the validity, legality and enforceability of any such provision in every
other respect and of the remaining provisions hereof shall not be in any way
impaired or affected thereby, it being intended that all of the rights and
privileges of the parties shall be enforceable to the fullest extent permitted
by law.
17. Securities Held by the Company, etc. Whenever the
consent or approval of Holders of a specified percentage of principal amount of
Securities or Exchange Securities is required hereunder, Securities or Exchange
Securities, as applicable, held by the Company or its Affiliates (other than
subsequent Holders of Securities or Exchange Securities if such subsequent
Holders are deemed to be Affiliates solely by reason of their holdings of such
Securities or Exchange Securities) shall not be counted in determining whether
such consent or approval was given by the Holders of such required percentage.
23
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this Agreement and your acceptance shall represent a binding agreement
among the Company, the Subsidiary Guarantors and the several Initial Purchasers.
Very truly yours,
AVIALL, INC.
By: /s/ COLIN M. COHEN
----------------------------
Name: Colin M. Cohen
Title: Chief Financial Officer
SUBSIDIARY GUARANTORS:
AVIALL SERVICES, INC.
AVIALL PRODUCT REPAIR SERVICES, INC.
AVIALL JAPAN LIMITED
INVENTORY LOCATOR SERVICE, LLC
INVENTORY LOCATOR SERVICE-UK, INC.
By: /s/ JEFFREY J. MURPHY
--------------------------------
Name: Jeffrey J. Murphy
Title: Senior Vice President and
Secretary
The foregoing Agreement is hereby confirmed and
accepted as of the date first above written.
CITIGROUP GLOBAL MARKETS INC.
CREDIT SUISSE FIRST BOSTON LLC
WACHOVIA SECURITIES, LLC
By: CITIGROUP GLOBAL MARKETS INC.
By: /s/ JEFFREY J. SINGER
--------------------------------
Name: Jeffrey J. Singer
Title: Director
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ANNEX A
Each broker-dealer that receives exchange securities for its
own account pursuant to the exchange offer must acknowledge that it will deliver
a prospectus in connection with any resale of these exchange securities. The
letter of transmittal states that by so acknowledging and by delivering a
prospectus, a broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act. Under existing
interpretations of the SEC, this prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer in connection
with resales of exchange securities received in exchange for securities where
those securities were acquired by this broker-dealer as a result of
market-making activities or other trading activities. The SEC may change these
interpretations at any time. We have agreed that until the earlier of (i) the
close of business 180 days after the expiration date and (ii) the date on which
all broker-dealers have sold all exchange securities, we will make this
prospectus available to any broker-dealer for use in connection with any such
resale. See "Plan of Distribution."
25
ANNEX B
Each broker-dealer that receives exchange securities for its
own account in exchange for securities, where those securities were acquired by
this broker-dealer as a result of market-making activities or other trading
activities, must acknowledge that it will deliver a prospectus in connection
with any resale of those exchange securities. See "Plan of Distribution."
26
ANNEX C
PLAN OF DISTRIBUTION
Each broker-dealer that receives exchange securities for its
own account pursuant to the exchange offer must acknowledge that it will deliver
a prospectus in connection with any resale of these exchange securities. This
prospectus, as it may be amended or supplemented from time to time, may be used
by a broker-dealer in connection with resales of exchange securities received in
exchange for securities where those securities were acquired as a result of
market-making activities or other trading activities. We and the subsidiary
guarantors have agreed that, until the earlier of (i) the close of business 180
days after the expiration date and (ii) the date on which all broker-dealers
have sold all exchange securities, we will make this prospectus, as amended or
supplemented, available to any broker-dealer for use in connection with any such
resale. In addition, until __________, 200__, all dealers effecting transactions
in the exchange securities may be required to deliver a prospectus.
We will not receive any proceeds from any sale of exchange
securities by broker-dealers. Exchange securities received by broker-dealers for
their own account pursuant to the exchange offer may be sold from time to time
in one or more transactions in the over-the-counter market, in negotiated
transactions, through the writing of options on the exchange securities or a
combination of such methods of resale, at market prices prevailing at the time
of resale, at prices related to such prevailing market prices or negotiated
prices. Any such resale may be made directly to purchasers or to or through
brokers or dealers who may receive compensation in the form of commissions or
concessions from any such broker-dealer and/or the purchasers of any such
exchange securities. Any broker-dealer that resells exchange securities that
were received by it for its own account pursuant to the exchange offer and any
broker or dealer that participates in a distribution of such exchange securities
may be deemed to be an "underwriter" within the meaning of the Securities Act
and any profit of any such resale of exchange securities and any commissions or
concessions received by any such persons may be deemed to be underwriting
compensation under the Securities Act. The letter of transmittal states that by
acknowledging that it will deliver and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act.
Until the earlier of (i) the close of business 180 days after
the expiration date and (ii) the date on which all broker-dealers have sold all
exchange securities, we and the subsidiary guarantors will promptly send
additional copies of this prospectus and any amendment or supplement to this
prospectus to any broker-dealer that requests such documents in the letter of
transmittal. We have agreed to pay all expenses incident to the exchange offer
other than commissions or concessions of any brokers or dealers and will
indemnify the holders of the securities (including any broker-dealers) against
certain liabilities, including liabilities under the Securities Act.
27
ANNEX D
Rider A
[ ] CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE
10 ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY
AMENDMENTS OR SUPPLEMENTS THERETO.
Name: ____________________________________
Address: ____________________________________
____________________________________
Rider B
If the undersigned is not a broker-dealer, the undersigned represents that it
acquired the exchange securities in the ordinary course of its business, it is
not engaged in, and does not intend to engage in, a distribution of exchange
securities and it has no arrangements or understandings with any person to
participate in a distribution of the exchange securities. If the undersigned is
a broker-dealer that will receive exchange securities for its own account in
exchange for securities, it represents that the securities to be exchanged for
exchange securities were acquired by it as a result of market-making activities
or other trading activities and acknowledges that it will deliver a prospectus
in connection with any resale of such exchange securities; however, by so
acknowledging and by delivering a prospectus, the undersigned will not be deemed
to admit that it is an "underwriter" within the meaning of the Securities Act.
28