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EXECUTION COPY
REGISTRATION RIGHTS AGREEMENT
Dated as of February 18, 1997
between
Petroleum Heat and Power Co., Inc.
and
Donaldson, Lufkin & Jenrette Securities Corporation
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This Registration Rights Agreement (this "Agreement") is made and entered
into as of February 18, 1997 between Petroleum Heat and Power Co., Inc., a
Minnesota corporation (the "Company"), and Donaldson, Lufkin & Jenrette
Securities Corporation (the "Initial Purchaser"). The Initial Purchaser has
agreed to purchase (the "Initial Placement") the Company's 127/8% Exchangeable
Preferred Stock due 2009 (the "Preferred Stock") pursuant to the Purchase
Agreement (as defined below). Pursuant to the terms of the Certificate of
Designation (as defined below), the Preferred Stock is exchangeable under
certain circumstances for the Company's 127/8% Junior Subordinated Exchange
Debentures due 2009 (the "Exchange Debentures") or for the New Preferred Stock
(as defined below).
This Agreement is made pursuant to the Purchase Agreement, dated February
12, 1997 (the "Purchase Agreement"), between the Company and the Initial
Purchaser. In order to induce the Initial Purchaser to purchase the Preferred
Stock, the Company has agreed to provide the registration rights set forth in
this Agreement. The execution and delivery of this Agreement is a condition to
the obligations of the Initial Purchaser set forth in Section 3 of the Purchase
Agreement.
The parties hereby agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement, the following capitalized terms shall have the
following meanings:
Act: The Securities Act of 1933, as amended.
Broker-Dealer: Any broker or dealer registered under the Exchange Act.
Broker-Dealer Transfer Restricted Securities: New Preferred Stock or New
Exchange Debentures that are acquired by a Broker-Dealer in the Exchange Offer
in exchange for Preferred Stock or Exchange Debentures, as the case may be, and
that such Broker-Dealer acquired for its own account as a result of
market-making activities or other trading activities (other than Preferred Stock
or Exchange Debentures acquired directly from the Company or any of its
affiliates).
Business Day: Any day except a Saturday, Sunday or other day in the City
of New York, or in the city of the corporate trust office of the Transfer Agent
or the Trustee, on which banks are authorized to close.
Certificate of Designation: The Certificate of Designation pursuant to
which the shares of Preferred Stock and New Preferred Stock are to be issued, as
such Certificate of Designation is amended or supplemented from time to time in
accordance with the terms thereof.
Certificated Securities: As defined in the Certificate of Designation and
the Exchange Debenture Indenture.
Closing Date: The date of this Agreement.
Commission: The Securities and Exchange Commission.
Consummate: An Exchange Offer shall be deemed "Consummated" for purposes
of this Agreement upon the occurrence of (i) the filing and effectiveness under
the Act of the Exchange Offer Registration Statement relating to the New
Preferred Stock or, if the Preferred Stock has been exchanged for Exchange
Debentures, the New Exchange Debentures to be issued in the Exchange Offer, (ii)
the
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maintenance of such Registration Statement continuously effective and the
keeping of the Exchange Offer open for a period not less than the minimum period
required pursuant to Section 3(b) hereof, and (iii) the delivery by the Company
to the Transfer Agent of shares of New Preferred Stock with the same aggregate
liquidation preference as the aggregate liquidation preference of the shares of
Preferred Stock that were tendered by Holders thereof pursuant to the Exchange
Offer, or, if the Preferred Stock has been exchanged for Exchange Debentures,
the delivery by the Company to the Trustee of New Exchange Debentures in the
same aggregate principal amount as the aggregate principal amount of Exchange
Debentures that were tendered by Holders thereof pursuant to the Exchange Offer.
Damages Payment Date: Each Dividend Payment Date or Interest Payment Date,
as the case may be.
Debentures: The Exchange Debentures and the New Exchange Debentures.
Dividend Payment Date: As defined in the Certificate of Designation.
Effectiveness Target Date: As defined in Section 5.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Exchange Debenture Indenture: The Exchange Debenture Indenture to be
entered into upon exchange of the Preferred Stock for Exchange Debentures, by
the Company and the Trustee, pursuant to which the Debentures are to be issued,
as such Exchange Debenture Indenture is amended or supplemented from time to
time in accordance with the terms thereof.
Exchange Offer: The registration by the Company under the Act of the New
Preferred Stock or, if the Preferred Stock has been exchanged for Exchange
Debentures, the New Exchange Debentures pursuant to the Exchange Offer
Registration Statement pursuant to which the Company shall offer the Holders of
all outstanding Transfer Restricted Securities the opportunity to exchange all
such outstanding Transfer Restricted Securities held by such Holders for New
Preferred Stock with the same aggregate liquidation preference as the Preferred
Stock tendered in such exchange by such Holders, or New Exchange Debentures in
an aggregate principal amount equal to the aggregate principal amount of the
Exchange Debentures tendered in such exchange offer by such Holders, as the case
may be.
Exchange Offer Registration Statement: The Registration Statement relating
to the Exchange Offer, including the related Prospectus.
Exempt Resales: The transactions in which the Initial Purchaser proposes
to sell the Preferred Stock to certain "qualified institutional buyers," as such
term is defined in Rule 144A under the Act, and to certain institutional
"accredited investors," as such term is defined in Rule 501(a)(1), (2), (3) or
(7) of Regulation D under the Act ("Accredited Institutions").
Global Security Holder: As defined in the Certificate of Designation and
the Exchange Debenture Indenture.
Holders: As defined in Section 2(b) hereof.
Indemnified Holder: As defined in Section 8(a) hereof.
Interest Payment Date: As defined in the Exchange Debenture Indenture and
the Debentures.
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Liquidated Damages: As defined in Section 5 hereof.
NASD: National Association of Securities Dealers, Inc.
New Exchange Debentures: The Company's 127/8% Junior Subordinated Exchange
Debentures due 2009 to be issued pursuant to the Exchange Debenture Indenture
(i) in the Exchange Offer or (ii) upon the request of any Holder of Exchange
Debentures covered by a Shelf Registration Statement in exchange for such
Exchange Debentures.
New Preferred Stock: The Company's 127/8% Exchangeable Preferred Stock due
2009 to be issued pursuant to the Certificate of Designation (i) in the Exchange
Offer or (ii) upon the request of any Holder of Preferred Stock covered by a
Shelf Registration Statement in exchange for such Preferred Stock.
Person: An individual, partnership, corporation, trust or unincorporated
organization, or a government or agency or political subdivision thereof.
Prospectus: The prospectus included in a 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 Damages Payment Date, each Person who
is a Holder of Transfer Restricted Securities on the record date with respect to
the Dividend Payment Date or Interest Payment Date, as the case may be, on which
such Damages Payment Date shall occur.
Registration Default: As defined in Section 5 hereof.
Registration Statement: Any registration statement of the Company relating
to (a) an offering of New Preferred Stock or New Exchange Debentures pursuant to
an Exchange Offer or (b) the registration for resale of Transfer Restricted
Securities pursuant to the Shelf Registration Statement, in each case, (i) which
is filed pursuant to the provisions of this Agreement and (ii) including the
Prospectus included therein, all amendments and supplements thereto (including
post-effective amendments) and all exhibits and material incorporated by
reference therein.
Restricted Broker-Dealer: Any Broker-Dealer which holds Broker-Dealer
Transfer Restricted Securities.
Shelf Registration Statement: As defined in Section 4 hereof.
TIA: The Trust Indenture Act of 1939 (15 U.S.C. Section 77aaa-77bbbb) as
in effect on the date of the Exchange Debenture Indenture.
Transfer Agent: The transfer agent with respect to the Preferred Stock.
Transfer Restricted Securities: Each share of Preferred Stock or each
Exchange Debenture, until the earliest to occur of (a) the date on which such
share of Preferred Stock or such Exchange Debenture is exchanged in the Exchange
Offer and entitled to be resold to the public by the Holder thereof without
complying with the prospectus delivery requirements of the Act, (b) the date on
which such share of Preferred Stock or such Exchange Debenture has been
effectively registered under the Act and disposed of in accordance with a Shelf
Registration Statement, (c) the date on which such share of
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Preferred Stock or such Exchange Debenture is distributed to the public pursuant
to Rule 144 under the Act or (d) the date on which such share of Preferred Stock
or such Exchange Debenture is disposed of by a Broker-Dealer pursuant to the
"Plan of Distribution" contemplated by the Exchange Offer Registration Statement
(including delivery of the Prospectus contained therein).
Trustee: The trustee named in the Exchange Debenture Indenture with
respect to the Debentures.
Underwritten Registration or Underwritten Offering: A registration in
which securities of the Company are sold to an underwriter for reoffering to the
public.
SECTION 2. SECURITIES SUBJECT TO THIS AGREEMENT
(a) Transfer Restricted Securities. The securities entitled to the
benefits of this Agreement are the Transfer Restricted Securities.
(b) Holders of Transfer Restricted Securities. A Person is deemed to be a
holder of Transfer Restricted Securities (each, a "Holder") whenever such Person
owns Transfer Restricted Securities.
SECTION 3. REGISTERED EXCHANGE OFFER
(a) Unless the Exchange Offer shall not be permissible under applicable
law or Commission policy (after the procedures set forth in Section 6(a) below
have been complied with), the Company shall (i) cause to be filed with the
Commission as soon as practicable after the Closing Date, but in no event later
than 60 days after the Closing Date, the Exchange Offer Registration Statement,
(ii) use its best efforts to cause such Exchange Offer Registration Statement to
become effective at the earliest possible time, but in no event later than 120
days after the Closing Date, (iii) in connection with the foregoing, file (A)
all pre-effective amendments to such Exchange Offer Registration Statement as
may be necessary in order to cause such Exchange Offer Registration Statement to
become effective, (B) if applicable, a post-effective amendment to such Exchange
Offer Registration Statement pursuant to Rule 430A under the Act and (C) cause
all necessary filings in connection with the registration and qualification of
the New Preferred Stock or New Exchange Debentures, as the case may be, to be
made under the Blue Sky laws of such jurisdictions as are necessary to permit
Consummation of the Exchange Offer and (iv) upon the effectiveness of such
Exchange Offer Registration Statement, commence and Consummate the Exchange
Offer. The Exchange Offer Registration Statement shall be on the appropriate
form permitting registration of the New Preferred Stock or New Exchange
Debentures to be offered in exchange for the Preferred Stock or the Exchange
Debentures, as the case may be, that are Transfer Restricted Securities and to
permit sales of Broker-Dealer Transfer Restricted Securities by Restricted
Broker-Dealers as contemplated by Section 3(c) below.
(b) The Company shall cause the Exchange Offer Registration Statement to
be effective continuously and shall keep the Exchange Offer open for a period of
not less than the minimum period required under applicable federal and state
securities laws to Consummate the Exchange Offer; provided, however, that in no
event shall such period be less than 20 Business Days. The Company shall cause
the Exchange Offer to comply with all applicable federal and state securities
laws. No securities other than the New Preferred Stock or New Exchange
Debentures shall be included in the Exchange Offer Registration Statement. The
Company shall use its best efforts to cause the Exchange Offer to be
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Consummated on the earliest practicable date after the Exchange Offer
Registration Statement has become effective, but in no event later than 30
Business Days thereafter.
(c) The Company shall include a "Plan of Distribution" section in the
Prospectus contained in the Exchange Offer Registration Statement and indicate
therein that any Restricted Broker-Dealer who holds Preferred Stock or Exchange
Debentures that are Transfer Restricted Securities and that were acquired for
its own account as a result of market-making activities or other trading
activities (other than Transfer Restricted Securities acquired directly from the
Company) may exchange such Preferred Stock or Exchange Debentures pursuant to
the Exchange Offer; however, such Broker-Dealer may be deemed to be an
"underwriter" within the meaning of the Act and must, therefore, deliver a
prospectus meeting the requirements of the Act in connection with the initial
sale of the New Preferred Stock or New Exchange Debentures received by such
Broker-Dealer in the Exchange Offer, which prospectus delivery requirement may
be satisfied by the delivery by such Broker-Dealer of the Prospectus contained
in the Exchange Offer Registration Statement. Such "Plan of Distribution"
section shall also contain all other information with respect to such sales of
Broker-Dealer Transfer Restricted Securities by Restricted Broker-Dealers that
the Commission may require in order to permit such resales pursuant thereto, but
such "Plan of Distribution" shall not name any such Broker-Dealer or disclose
the amount of Preferred Stock or Exchange Debentures held by any such
Broker-Dealer except to the extent required by the Commission as a result of a
change in policy after the date of this Agreement.
The Company shall use its best efforts to keep the Exchange Offer
Registration Statement continuously effective, supplemented and amended as
required by the provisions of Section 6(c) below to the extent necessary to
ensure that it is available for sales of Broker-Dealer Transfer Restricted
Securities by Restricted Broker-Dealers, and to ensure that such Registration
Statement conforms with the requirements of this Agreement, the Act and the
policies, rules and regulations of the Commission as announced from time to
time, for a period of one year from the date on which the Exchange Offer
Registration Statement is declared effective.
The Company shall provide sufficient copies of the latest version of such
Prospectus to Broker-Dealers promptly upon request at any time during such
one-year period in order to facilitate such resales.
SECTION 4. SHELF REGISTRATION
(a) Shelf Registration. If (i) the Company is not required to file an
Exchange Offer Registration Statement or to Consummate the Exchange Offer
because the Exchange Offer is not permitted by applicable law or Commission
policy (after the procedures set forth in Section 6(a) below have been complied
with) or (ii) if any Holder of Transfer Restricted Securities shall notify the
Company within 20 Business Days of the Consummation of the Exchange Offer (A)
that such Holder was prohibited by applicable law or Commission policy from
participating in the Exchange Offer, or (B) that such Holder may not resell the
New Preferred Stock or New Exchange Debentures acquired by it in the Exchange
Offer to the public without delivering a prospectus and that the Prospectus
contained in the Exchange Offer Registration Statement is not appropriate or
available for such resales by such Holder, or (C) that such Holder is a
Broker-Dealer and holds Preferred Stock or Exchange Debentures acquired directly
from the Company or one of its affiliates, then the Company shall:
(1) cause to be filed, on or prior to 60 days after the date on
which the Company determines that it is not required to file the Exchange
Offer Registration Statement pursuant to clause (i) above or 60 days after
the date on which the Company receives the notice specified in clause (ii)
above (and in any event within 180 days after the Closing Date), a shelf
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registration statement pursuant to Rule 415 under the Act (which may be an
amendment to the Exchange Offer Registration Statement (in either event,
the "Shelf Registration Statement")), relating to all Transfer Restricted
Securities the Holders of which shall have provided the information
required pursuant to Section 4(b) hereof;
(2) use its best efforts to cause such Shelf Registration Statement
to become effective on or prior to 120 days after the date on which the
Company becomes obligated to file such Shelf Registration Statement (and
in any event within 240 days after the Closing Date);
(3) use its best efforts to keep such Shelf Registration Statement
continuously effective, supplemented and amended as required by the
provisions of Sections 6(b) and (c) hereof to the extent necessary to
ensure that it is available for sales of Transfer Restricted Securities by
the Holders thereof entitled to the benefit of this Section 4(a), and to
ensure that it conforms with the requirements of this Agreement, the Act
and the policies, rules and regulations of the Commission as announced
from time to time, for a period of at least three years (as extended
pursuant to Section 6(c)(i)) following the date on which such Shelf
Registration Statement first becomes effective under the Act or such
shorter period ending when all of the Transfer Restricted Securities
available for sale thereunder have been sold.
(b) Provision by Holders of Certain Information in Connection with the
Shelf Registration Statement. No Holder of Transfer Restricted Securities may
include any of its Transfer Restricted Securities in any Shelf Registration
Statement pursuant to this Agreement unless and until such Holder furnishes to
the Company in writing, within 15 Business Days after receipt of a request
therefor, such information specified in Item 507 of Regulation S-K under the Act
for use in connection with any Shelf Registration Statement or Prospectus or
preliminary Prospectus included therein. No Holder of Transfer Restricted
Securities shall be entitled to Liquidated Damages pursuant to Section 5 hereof
unless and until such Holder shall have provided all such reasonably requested
information. Each Holder as to which any Shelf Registration Statement is being
effected agrees to furnish promptly to the Company all information required to
be disclosed in order to make the information previously furnished to the
Company by such Holder not materially misleading.
SECTION 5. LIQUIDATED DAMAGES
If (i) any Registration Statement required by this Agreement is not filed
with the Commission on or prior to the date specified for such filing in this
Agreement, (ii) any such Registration Statement has not been declared effective
by the Commission on or prior to the date specified for such effectiveness in
this Agreement (the "Effectiveness Target Date"), (iii) the Exchange Offer has
not been Consummated within 30 Business Days after the Effectiveness Target Date
with respect to the Exchange Offer Registration Statement or (iv) any
Registration Statement required by this Agreement is filed and declared
effective but shall thereafter cease to be effective or fail to be usable for
its intended purpose without being succeeded within 5 days thereafter by a
post-effective amendment to such Registration Statement that cures such failure
and that is itself immediately declared effective (each such event referred to
in clauses (i) through (iv), a "Registration Default"), then the Company shall
pay liquidated damages to (A) each Holder of Preferred Stock with respect to the
first 90-day period immediately following the occurrence of such Registration
Default in an amount equal to $.00125 per week per $25 liquidation preference of
Preferred Stock constituting Transfer Restricted Securities for each week or
portion thereof that the Registration Default continues and (B) each Holder of
Exchange Debentures with respect to the first 90-day period immediately
following the occurrence of such Registration Default, in an amount equal
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to $.05 per week per $1,000 in principal amount of Exchange Debentures held by
such Holder for each week or portion thereof that the Registration Default
continues. The amount of the liquidated damages payable to any holder of
Preferred Stock or Exchange Debentures shall increase by an additional $.00125
per week per $25 liquidation preference of Preferred Stock or $.05 per week per
$1,000 in principal amount of Exchange Debentures, as the case may be, held by
such Holder with respect to each subsequent 90-day period until all Registration
Defaults have been cured, up to a maximum amount of liquidated damages of $.0125
per week per $25 liquidation preference of Preferred Stock or $.50 per week per
$1,000 in principal amount of Exchange Debentures, as the case may be.
All accrued liquidated damages shall be paid in cash to the Global
Security Holder by the Company by wire transfer of same day funds to the
accounts specified by the Global Security Holder and to Holders of Certificated
Securities by wire transfer of same day funds to the accounts specified by the
Holders thereof, or if no account is specified by mailing a check to each
Holder's registered addresses on each Damages Payment Date.
All obligations of the Company set forth in this Section 5 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 security shall have been
satisfied in full.
SECTION 6. REGISTRATION PROCEDURES
(a) Exchange Offer Registration Statement. In connection with the Exchange
Offer, the Company shall comply with all of the provisions of Section 6(c)
below, shall use its best efforts to effect such exchange and to permit the sale
of Broker-Dealer Transfer Restricted Securities being sold in accordance with
the intended method or methods of distribution thereof, and shall comply with
all of the following provisions:
(i) If in the reasonable opinion of counsel to the Company there is
a question as to whether the Exchange Offer is permitted by applicable
law, the Company shall seek a no-action letter or other favorable decision
from the Commission allowing the Company to Consummate an Exchange Offer
for such Preferred Stock or Exchange Debentures, as the case may be. The
Company hereby agrees to pursue the issuance of such a decision to the
Commission staff level but shall not be required to take commercially
unreasonable action to effect a change of Commission policy. In connection
with the foregoing, the Company hereby agrees to take all such other
actions as are requested by the Commission or otherwise required in
connection with the issuance of such decision, including without
limitation (A) participating in telephonic conferences with the
Commission, (B) delivering to the Commission staff an analysis prepared by
counsel to the Company setting forth the legal bases, if any, upon which
such counsel has concluded that such an Exchange Offer should be permitted
and (C) diligently pursuing a resolution (which need not be favorable) by
the Commission staff of such submission.
(ii) As a condition to its participation in the Exchange Offer
pursuant to the terms of this Agreement, each Holder of Transfer
Restricted Securities shall furnish, upon the request of the Company,
prior to the Consummation thereof, a written representation to the Company
(which may be contained in the letter of transmittal contemplated by the
Exchange Offer Registration Statement) to the effect that (A) it is not an
affiliate of the Company, (B) it is not engaged in, and does not intend to
engage in, and has no arrangement or understanding with any person to
participate in, a distribution of the New Preferred Stock or New Exchange
Debentures to be issued in the Exchange
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Offer and (C) it is acquiring the New Preferred Stock or New Exchange
Debentures in its ordinary course of business. In addition, all such
Holders of Transfer Restricted Securities shall otherwise cooperate in the
Company's preparations for the Exchange Offer. Each Holder hereby
acknowledges and agrees that any Broker-Dealer and any such Holder using
the Exchange Offer to participate in a distribution of the securities to
be acquired in the Exchange Offer (1) could not under Commission policy as
in effect on the date of this Agreement rely on the position of the
Commission enunciated in Morgan Stanley and Co., Inc. (available June 5,
1991) and Exxon Capital Holdings Corporation (available May 13, 1988), as
interpreted in the Commission's letter to Shearman & Sterling dated July
2, 1993, and similar no-action letters (including any no-action letter
obtained pursuant to clause (i) above), and (2) must comply with the
registration and prospectus delivery requirements of the Act in connection
with a secondary resale transaction and that such a secondary resale
transaction should 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 if the resales are of New Preferred
Stock or New Exchange Debentures obtained by such Holder in exchange for
Preferred Stock or Exchange Debentures acquired by such Holder directly
from the Company.
(iii) Prior to effectiveness of the Exchange Offer Registration
Statement, the Company shall provide a supplemental letter to the
Commission (A) stating that the Company is registering the Exchange Offer
in reliance on the position of the Commission enunciated in Exxon Capital
Holdings Corporation (available May 13, 1988), Morgan Stanley and Co.,
Inc. (available June 5, 1991) and, if applicable, any no-action letter
obtained pursuant to clause (i) above, (B) including a representation that
the Company has not entered into any arrangement or understanding with any
Person to distribute the New Preferred Stock or New Exchange Debentures to
be received in the Exchange Offer and that, to the best of the Company's
information and belief, each Holder participating in the Exchange Offer is
acquiring the New Preferred Stock or New Exchange Debentures in its
ordinary course of business and has no arrangement or understanding with
any Person to participate in the distribution of the New Preferred Stock
or New Exchange Debentures received in the Exchange Offer and (C)
including any other undertaking or representation required by the
Commission as set forth in any no-action letter obtained pursuant to
clause (i) above.
(b) Shelf Registration Statement. In connection with the Shelf
Registration Statement, the Company shall comply with all the provisions of
Section 6(c) below and shall use its best efforts to effect such registration to
permit the sale of the Transfer Restricted Securities being sold in accordance
with the intended method or methods of distribution thereof, and pursuant
thereto the Company shall as expeditiously as possible prepare and file with the
Commission a Registration Statement relating to the registration on any
appropriate form under the Act, which form shall be available for the sale of
the Transfer Restricted Securities in accordance with the intended method or
methods of distribution thereof.
(c) General Provisions. In connection with any Registration Statement and
any Prospectus required by this Agreement to permit the sale or resale of
Transfer Restricted Securities (including, without limitation, any Exchange
Offer Registration Statement and the related Prospectus required to permit sales
of Broker-Dealer Transfer Restricted Securities by Restricted Broker-Dealers),
the Company shall:
(i) use its best efforts to keep such Registration Statement
continuously effective and provide all requisite financial statements for
the period specified in Section 3 or 4 of this Agreement, as applicable;
and upon the occurrence of any event that would cause any such
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 period required by
this Agreement, the Company promptly shall file an appropriate amendment
to such
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Registration Statement, (1) in the case of clause (A), correcting any such
misstatement or omission, and (2) in the case of clauses (A) and (B), use
its best efforts to cause such amendment to be declared effective and such
Registration Statement and the related Prospectus to become usable for their
intended purpose(s) as soon as practicable thereafter;
(ii) prepare and file with the Commission such amendments and
post-effective amendments to the Registration Statement as may be
necessary to keep the Registration Statement effective for the applicable
period set forth in Section 3 or 4 hereof, as applicable, or such shorter
period as will terminate when all Transfer Restricted Securities covered
by such Registration Statement have been sold; cause the Prospectus to be
supplemented by any required Prospectus supplement, and as so supplemented
to be filed pursuant to Rule 424 under the Act, and to comply fully with
the applicable provisions of Rules 424, 430A and 462 under the Act in a
timely manner; and comply with the provisions of the Act with respect to
the disposition of all securities covered by such Registration Statement
during the applicable period in accordance with the intended method or
methods of distribution by the selling Holders thereof set forth in such
Registration Statement or supplement to the Prospectus;
(iii) advise the underwriter(s), if any, and selling Holders
promptly and, if requested by such Persons, to confirm such advice in
writing, (A) when the Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to any
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 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 Registration Statement under the 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, (D) of the
existence of any fact or the happening of any event that makes any
statement of a material fact made in the 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 Registration Statement or the
Prospectus in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and if at any
time the Commission shall issue any stop order suspending the
effectiveness of the 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 best efforts to obtain the withdrawal or lifting of such
order at the earliest possible time;
(iv) furnish to each of the selling Holders, each of the
underwriter(s), if any, and, if requested, the Initial Purchaser, before
filing with the Commission, copies of any Registration Statement or any
Prospectus included therein or any amendments or supplements to any such
Registration Statement or Prospectus (including all documents incorporated
by reference after the initial filing of such Registration Statement),
which documents will be subject to the review and comment of such persons
for a period of at least three Business Days, and the Company shall not
file any such Registration Statement or Prospectus or any amendment or
supplement to any such Registration Statement or Prospectus (including all
such documents incorporated by reference) to which a selling Holder of
Transfer Restricted Securities covered by such Registration Statement or
the underwriter(s), if any, shall reasonably object within three Business
Days after the receipt thereof; a selling Holder or underwriter, if any,
shall be deemed to have reasonably objected to such filing if such
Registration Statement, amendment, Prospectus or supplement, as
applicable, as
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proposed to be filed, (1) contains a material misstatement or omission or
(2) fails to comply in any material respects with the applicable
requirements of the Act;
(v) promptly upon the filing of any document that is to be
incorporated by reference into a Registration Statement or Prospectus,
provide copies of such document to the selling Holders and to the
underwriter(s), if any;
(vi) make available at reasonable times for inspection by the
selling Holders, any underwriter participating in any disposition pursuant
to such Registration Statement, and any attorney or accountant retained by
such selling Holders or any of the underwriter(s), all financial and other
records, pertinent corporate documents and properties of the Company and
cause the Company's officers, directors and employees to supply all
information reasonably requested by any such Holder, underwriter, attorney
or accountant in connection with such Registration Statement or any
post-effective amendment thereto subsequent to the filing thereof and
prior to its effectiveness, and make the Company's representatives
reasonably available for discussion of such document and other customary
due diligence matters;
(vii) if requested by any selling Holders or the underwriter(s), if
any, promptly incorporate in any Registration Statement or Prospectus,
pursuant to a supplement or post-effective amendment if necessary, such
information as such selling Holders and underwriter(s), if any, may
reasonably request to have included therein, including, without
limitation, information relating to the "Plan of Distribution" of the
Transfer Restricted Securities, information with respect to the principal
amount of Transfer Restricted Securities being sold to such
underwriter(s), the purchase price being paid therefor and any other terms
of the offering of the Transfer Restricted Securities to be sold in such
offering; and make all required filings of such Prospectus supplement or
post-effective amendment as soon as practicable after the Company is
notified of the matters to be incorporated in such Prospectus supplement
or post-effective amendment;
(viii) use its best efforts to cause the Transfer Restricted
Securities covered by the Registration Statement to be rated with the
appropriate rating agencies, if so requested by the Holders of a majority
in liquidation preference of Preferred Stock or aggregate principal amount
of Exchange Debentures, as the case may be, covered thereby or the
underwriter(s), if any;
(ix) furnish to each selling Holder and each of the underwriter(s),
if any, without charge, at least one copy of the Registration Statement,
as first filed with the Commission, and of each amendment thereto,
including all documents incorporated by reference therein and all exhibits
(including exhibits incorporated therein by reference);
(x) deliver to each selling Holder and each of the underwriter(s),
if any, without charge, as many copies of the Prospectus (including each
preliminary prospectus) and any amendment or supplement thereto as such
Persons reasonably may request; the Company hereby consents to the use of
the Prospectus and any amendment or supplement thereto by each of the
selling Holders and each of the underwriter(s), if any, in connection with
the offering and the sale of the Transfer Restricted Securities covered by
the Prospectus or any amendment or supplement thereto;
(xi) enter into such agreements (including an underwriting agreement
in customary form), and make such representations and warranties in
customary form, and take all such other actions in connection therewith in
order to expedite or facilitate the disposition of the Transfer Restricted
Securities pursuant to any Registration Statement contemplated by this
Agreement, all to such extent as may be reasonably requested by the
Initial Purchaser or by any Holder of Transfer Restricted
10
Securities or underwriter in connection with any sale or resale pursuant
to any Registration Statement contemplated by this Agreement; and whether
or not an underwriting agreement is entered into and whether or not the
registration is an Underwritten Registration, the Company shall:
(A) furnish to each selling Holder, each underwriter, if any,
and, if requested by the Initial Purchaser, in such substance and
scope as they may request and as are customarily made by issuers to
underwriters in primary underwritten offerings, upon the
effectiveness of the Shelf Registration Statement and to each
Restricted Broker-Dealer upon Consummation of the Exchange Offer:
(1) a certificate, dated the date of Consummation of the
Exchange Offer or the date of effectiveness of the Shelf
Registration Statement, as the case may be, signed on behalf
of the Company by (y) the President or any Vice President and
(z) a principal financial or accounting officer of the
Company, confirming, as of the date thereof, the matters set
forth in paragraphs (a), (b), (c) and (d) of Section 9 of the
Purchase Agreement and such other matters as such parties may
reasonably request;
(2) an opinion, dated the date of Consummation of the
Exchange Offer or the date of effectiveness of the Shelf
Registration Statement, as the case may be, of counsel for the
Company covering the matters set forth in clauses (i), (iii),
(xv) and (xix) of paragraph (f)(1) of Section 9 of the
Purchase Agreement and such other matter as the Holders,
underwriters and/or Restricted Broker-Dealers may reasonably
request, and in any event including a statement to the effect
that such counsel has participated in conferences with
officers and other representatives of the Company,
representatives of the independent public accountants for the
Company, the Initial Purchaser's representatives and the
Initial Purchaser's counsel in connection with the preparation
of such Registration Statement and the related Prospectus and
have considered the matters required to be stated therein and
the statements contained therein, although such counsel has
not independently verified the accuracy, completeness or
fairness of such statements; and that such counsel advises
that, on the basis of the foregoing (relying as to materiality
to a large extent upon facts provided to such counsel by
officers and other representatives of the Company and without
independent check or verification), no facts came to such
counsel's attention that caused such counsel to believe that
the applicable Registration Statement, at the time such
Registration Statement or any post-effective amendment thereto
became effective, and, in the case of the Exchange Offer
Registration Statement, as of the date of Consummation of the
Exchange Offer, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading, or that the Prospectus contained in such
Registration Statement as of its date and, in the case of the
opinion dated the date of Consummation of the Exchange Offer,
as of the date of Consummation, contained an untrue statement
of a material fact or omitted to state a material fact
necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not
misleading (without limiting the foregoing, such counsel may
state further that such counsel assumes no responsibility for,
and has not independently verified, the accuracy, completeness
or fairness of the financial statements, notes and schedules
and other financial or statistical data included in any
Registration Statement contemplated by this Agreement or the
related Prospectus); and
11
(3) a customary comfort letter, dated as of the date of
Consummation of the Exchange Offer or the date of
effectiveness of the Shelf Registration Statement, as the case
may be, from the Company's independent accountants, in the
customary form and covering matters of the type customarily
covered in comfort letters to underwriters in connection with
primary underwritten offerings, and affirming the matters set
forth in the comfort letters delivered pursuant to Section
9(f)(3) of the Purchase Agreement, without exception, other
than those exceptions that, individually and in the aggregate,
are not material;
(B) set forth in full or incorporate by reference in the
underwriting agreement, if any, in connection with any resale
pursuant to any Shelf Registration Statement the indemnification
provisions and procedures of Section 8 hereof with respect to all
parties to be indemnified pursuant to said Section; and
(C) deliver such other documents and certificates as may be
reasonably requested by the selling Holders, underwriters, if any,
and Restricted Broker-Dealers, if any, to evidence compliance with
clause (A) above and with any customary conditions contained in the
underwriting agreement or other agreement entered into by the
Company pursuant to this clause (xi), if any.
If at any time the representations and warranties of the Company
contained in the certificate described in clause (A)(1) above cease to be
true and correct, the Company shall so advise the selling Holders and each
Restricted Broker-Dealer promptly and, if requested by such Persons, shall
confirm such advice in writing;
(xii) prior to any public offering of Transfer Restricted
Securities, cooperate with the selling Holders, the underwriter(s), if
any, and their respective counsel in connection with the registration and
qualification of the Transfer Restricted Securities under the securities
or Blue Sky laws of such jurisdictions as the selling Holders or
underwriter(s), if any, may 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
applicable Registration Statement; provided, however, that the Company
shall not be required to register or qualify as a foreign corporation
where it is not now so qualified or to take any action that would subject
it to the service of process in suits or to taxation, other than as to
matters and transactions relating to the Registration Statement, in any
jurisdiction where it is not now so subject;
(xiii) issue, upon the request of any Holder of Preferred Stock or
Exchange Debentures covered by any Shelf Registration Statement, New
Preferred Stock or New Exchange Debentures having a liquidation preference
or an aggregate principal amount, as the case may be, equal to the
liquidation preference or aggregate principal amount of New Preferred
Stock or New Exchange Debentures, as the case may be, surrendered to the
Company by such Holder in exchange therefor or being sold by such Holder;
such New Preferred Stock or New Exchange Debentures to be registered in
the name of such Holder or in the name of the purchaser(s) of such New
Preferred Stock or New Exchange Debentures, as the case may be, in return,
the Preferred Stock or the Exchange Debentures, as the case may be, held
by such Holder shall be surrendered to the Company for cancellation;
(xiv) in connection with any sale of Transfer Restricted Securities
that will result in such securities no longer being Transfer Restricted
Securities, cooperate with the selling Holders and the underwriter(s), if
any, to facilitate the timely preparation and delivery of certificates
representing
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Transfer Restricted Securities to be sold and not bearing any restrictive
legends; and to register such Transfer Restricted Securities in such
denominations and such names as the Holders or the underwriter(s), if any,
may request at least two Business Days prior to such sale of Transfer
Restricted Securities;
(xv) use its best efforts to cause the Transfer Restricted
Securities covered by the Registration Statement to be registered with or
approved by such other governmental agencies or authorities as may be
necessary to enable the seller or sellers thereof or the underwriter(s),
if any, to consummate the disposition of such Transfer Restricted
Securities, subject to the proviso contained in clause (xii) above;
(xvi) if any fact or event contemplated by Section 6(c)(iii)(D)
above shall exist or have occurred, prepare a supplement or post-effective
amendment to the 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 necessary to make
the statements therein, in the light of the circumstances under which they
were made, not misleading;
(xvii) provide a CUSIP number for all Transfer Restricted Securities
not later than the effective date of a Registration Statement covering
such Transfer Restricted Securities and provide the Transfer Agent or the
Trustee, as the case may be, with printed certificates for the Transfer
Restricted Securities which are in a form eligible for deposit with The
Depository Trust Company;
(xviii) 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 (including any "qualified independent underwriter") that is
required to be retained in accordance with the rules and regulations of
the NASD, and use its reasonable best efforts to cause such Registration
Statement to become effective and approved by such governmental agencies
or authorities as may be necessary to enable the Holders selling Transfer
Restricted Securities to consummate the disposition of such Transfer
Restricted Securities;
(xix) otherwise use its best efforts to comply with all applicable
rules and regulations of the Commission, and make generally available to
its security holders with regard to any applicable Registration Statement,
as soon as practicable, a consolidated earnings statement meeting the
requirements of Rule 158 (which need not be audited) covering a
twelve-month period beginning after the effective date of the Registration
Statement (as such term is defined in paragraph (c) of Rule 158 under the
Act);
(xx) in the event that such Transfer Restricted Securities are
Exchange Debentures, cause the Exchange Debenture Indenture to be
qualified under the TIA not later than the later of (a) the date on which
the Preferred Stock is exchanged for Exchange Debentures or (b) the
effective date of the first Registration Statement relating to the
Exchange Debentures required by this Agreement, and, in connection
therewith, cooperate with the Trustee and the Holders of Exchange
Debentures to effect such changes to the Exchange Debenture Indenture as
may be required for such Exchange Debenture Indenture to be so qualified
in accordance with the terms of the TIA; and execute and use its best
efforts to cause the Trustee 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 Exchange Debenture
Indenture to be so qualified in a timely manner;
13
(xxi) cause all Transfer Restricted Securities covered by the
Registration Statement to be listed on each securities exchange on which
similar securities issued by the Company are then listed if requested by
the Holders of a majority in liquidation preference of Preferred Stock or
aggregate principal amount of Exchange Debentures or the managing
underwriter(s), if any; and
(xxii) provide promptly to each Holder upon request each document
filed with the Commission pursuant to the requirements of Section 13 or
Section 15(d) of the Exchange Act.
(d) Restrictions on Holders. Each Holder agrees by acquisition of a
Transfer Restricted Security that, upon receipt of the notice referred to in
Section 6(c)(i) or any notice from the Company of the existence of any fact of
the kind described in Section 6(c)(iii)(D) hereof, such Holder shall forthwith
discontinue disposition of Transfer Restricted Securities pursuant to the
applicable Registration Statement until such Holder's receipt of the copies of
the supplemented or amended Prospectus contemplated by Section 6(c)(xvi) hereof,
or until it is advised in writing (the "Advice") 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. 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 any such notice. In the
event the Company shall give any such notice, the time period regarding the
effectiveness of such Registration Statement set forth in Section 3 or 4 hereof,
as applicable, shall be extended by the number of days during the period from
and including the date of the giving of such notice pursuant to Section 6(c)(i)
or Section 6(c)(iii)(D) hereof to and including the date when each selling
Holder covered by such Registration Statement shall have received the copies of
the supplemented or amended Prospectus contemplated by Section 6(c)(xvi) hereof
or shall have received the Advice.
SECTION 7. REGISTRATION EXPENSES
(a) All expenses incident to the Company's performance of or compliance
with this Agreement shall be borne by the Company, regardless of whether a
Registration Statement becomes effective, including without limitation: (i) all
registration and filing fees and expenses (including filings made by the Initial
Purchaser or any Holder with the NASD (and, if applicable, the fees and expenses
of any "qualified independent underwriter" and its counsel that may be required
by the rules and regulations of 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 certificates for the New Preferred
Stock and New Exchange Debentures to be issued in the Exchange Offer and
printing of Prospectuses), messenger and delivery services and telephone; (iv)
all fees and disbursements of counsel for the Company and, subject to Section
7(b) below, the Holders of Transfer Restricted Securities; (v) all application
and filing fees in connection with listing the New Preferred Stock or the New
Exchange Debentures 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 (including the
expenses of any special audit and comfort letters required by or incident to
such performance).
The Company shall, in any event, bear its internal expenses (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expenses of any annual audit and the
fees and expenses of any Person, including special experts, retained by the
Company.
14
(b) In connection with any Registration Statement required by this
Agreement, the Company shall reimburse the Initial Purchaser and the Holders of
Transfer Restricted Securities being tendered in the Exchange Offer and/or
resold pursuant to the "Plan of Distribution" contained in the Exchange Offer
Registration Statement or registered pursuant to the Shelf Registration
Statement, as applicable, for the reasonable fees and disbursements of not more
than one counsel, who shall be Latham & Watkins or such other counsel as may be
chosen by the Holders of a majority in principal amount of the Transfer
Restricted Securities for whose benefit such Registration Statement is being
prepared.
SECTION 8. INDEMNIFICATION
(a) The Company shall indemnify and hold harmless (i) the Initial
Purchaser, (ii) each Holder and (iii) each person, if any, who controls (within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act) the
Initial Purchaser or any Holder (any of the persons referred to in this clause
(iii) being hereinafter referred to as a "controlling person") and (iv) the
respective officers, directors, partners, employees, representatives and agents
of the Initial Purchaser, Holder or controlling person (any person referred to
in clause (i), (ii), (iii) or (iv) may hereinafter be referred to as an
"Indemnified Holder"), to the fullest extent lawful, from and against any and
all losses, claims, damages, liabilities, judgments, actions and expenses
(including without limitation and as incurred, reimbursement of all reasonable
costs of investigating, preparing, pursuing or defending any claim or action, or
any investigation or proceeding by any governmental agency or body, commenced or
threatened, including the reasonable fees and expenses of counsel to any
Indemnified Holder) directly or indirectly caused by, related to, based upon,
arising out of or in connection with any untrue statement or alleged untrue
statement of a material fact contained in any Registration Statement,
preliminary prospectus or Prospectus (or any amendment or supplement thereto),
or any omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading,
except insofar as such losses, claims, damages, liabilities or expenses are
caused by an untrue statement or omission or alleged untrue statement or
omission that is made in reliance upon and in conformity with information
relating to any of the Holders furnished in writing to the Company by such
Holder expressly for use therein.
In case any action or proceeding (including any governmental or regulatory
investigation or proceeding) shall be brought or asserted against any of the
Indemnified Holders with respect to which indemnity may be sought against the
Company, such Indemnified Holder (or the Indemnified Holder controlled by such
controlling person) shall promptly notify the Company in writing (provided, that
the failure to give such notice shall not relieve the Company of its obligations
pursuant to this Agreement) and the Company shall assume the defense thereof,
including the employment of counsel reasonably satisfactory to such Indemnified
Holder and payment of all fees and expenses. Such Indemnified Holder shall have
the right to employ separate counsel in any such action and participate in the
defense thereof, but the fees and expenses of such counsel shall be at the
expense of such Indemnified Holder unless (i) the employment of such counsel has
been specifically authorized in writing by the Company, (ii) the Company shall
have failed to assume the defense and employ counsel or (iii) the named parties
to any such action (including any impleaded parties) include both such
Indemnified Holder and the Company and such Indemnified Holder shall have been
advised by its counsel that there may be one or more legal defenses available to
it which are different from or additional to those available to the Company (in
which case the Company shall not have the right to assume the defense of such
action on behalf of such Indemnified Holder). If separate counsel is employed
pursuant to clauses (i), (ii) or (iii) above, the fees and expenses of such
counsel shall be paid, as incurred, by the Company (regardless of whether it is
ultimately determined that an Indemnified Holder is not entitled to
indemnification hereunder). The Company shall not, in connection with any one
such action or proceeding or separate but substantially similar or related
actions or proceedings in the same jurisdiction arising out of the same general
15
allegations or circumstances, be liable for the reasonable fees and expenses of
more than one separate firm of attorneys (in addition to any local counsel) at
any time for such Indemnified Holders, which firm shall be designated by the
Indemnified Holders (selected in the same manner that underwriters are selected
pursuant to Section 11). The Company shall be liable for any settlement of any
such action or proceeding effected with the Company's prior written consent,
which consent shall not be withheld unreasonably, and the Company shall
indemnify and hold harmless any Indemnified Holder from and against any loss,
claim, damage, liability or expense by reason of any settlement of any action
effected with the written consent of the Company. The Company shall not, without
the prior written consent of each Indemnified Holder, settle or compromise or
consent to the entry of judgment in or otherwise seek to terminate any pending
or threatened action, claim, litigation or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not any
Indemnified Holder is a party thereto), unless such settlement, compromise,
consent or termination includes an unconditional release of each Indemnified
Holder from all liability arising out of such action, claim, litigation or
proceeding.
(b) Each Holder of Transfer Restricted Securities, severally and not
jointly, shall indemnify and hold harmless the Company and its respective
directors, officers, and any person controlling (within the meaning of Section
15 of the Act or Section 20 of the Exchange Act) the Company, and the respective
officers, directors, partners, employees, representatives and agents of each
such person, to the same extent as the foregoing indemnity from the Company to
each of the Indemnified Holders, but only with respect to claims and actions
based on information relating to such Holder furnished in writing by such Holder
expressly for use in any Registration Statement. In case any action or
proceeding shall be brought against the Company or its directors or officers or
any such controlling person in respect of which indemnity may be sought against
a Holder of Transfer Restricted Securities, such Holder shall have the rights
and duties given the Company and such directors or officers or such controlling
person shall have the rights and duties given to each Holder by the preceding
paragraph. In no event shall any Holder be liable or responsible for any amount
in excess of the amount by which the total received by such Holder with respect
to its sale of Transfer Restricted Securities pursuant to a Registration
Statement exceeds (i) the amount paid by such Holder for such Transfer
Restricted Securities plus (ii) the amount of any damages which such Holder has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission.
(c) If the indemnification provided for in this Section 8 is unavailable
to an indemnified party under Section 8(a) or Section 8(b) hereof (other than by
reason of exceptions provided in those Sections) in respect of any losses,
claims, damages, liabilities or expenses referred to therein, then each
applicable indemnifying party, in lieu of indemnifying such indemnified party,
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages, liabilities or expenses 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 sale of Transfer Restricted Securities
pursuant to the applicable Registration Statement or if such allocation is not
permitted by applicable law, the relative fault of such indemnifying party, on
the one hand, and of such indemnified party, on the other hand, in connection
with the statements or omissions which resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company shall be deemed to be equal to the
sum of (i) the total proceeds from the Initial Placement (net of the Initial
Purchaser's discounts and commissions, but before deducting expenses) as set
forth on the cover page of the Offering Memorandum and (ii) the total amount of
Liquidated Damages which the Company was not required to pay as a result of
registering the securities covered by the Registration Statement which resulted
in such losses, claims, damages, liabilities or expenses. The relative benefits
of the Initial Purchaser shall be deemed to be equal to the discounts and
commissions received by the Initial Purchaser as set forth on the cover page of
the
16
Offering Memorandum. The relative benefits received by any other Indemnified
Holder shall be deemed to be equal to the value of having such Holder's
Preferred Stock or Debentures registered under the Act. The relative fault of
the Company, on the one hand, and the Indemnified Holders, on the other hand,
shall be determined by reference to, among other things, 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 such party and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.
The Company, the Initial Purchaser and each Holder of Transfer Restricted
Securities agree that it would not be just and equitable if contribution
pursuant to this Section 8(c) were determined by pro rata allocation (even if
the Holders were treated as one entity for such purpose) or by any other method
of allocation which does not take account of the equitable considerations
referred to in the immediately preceding paragraph. The amount paid or payable
by an indemnified party as a result of the losses, claims, damages, liabilities
or expenses referred to in the immediately preceding paragraph shall be deemed
to include, subject to the limitations set forth above, any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 8, the Initial Purchaser or its related Indemnified
Holders shall not be required to contribute, in the aggregate, any amount in
excess of the amount equal to (A) the amount of the discounts and commissions
received by the Initial Purchaser less (B) any amount paid or contributed by the
Initial Purchaser under the Purchase Agreement, nor shall any Holder or its
related Indemnified Holders be required to contribute, in the aggregate, any
amount in excess of the amount by which the total received by such Holder with
respect to the sale of its Transfer Restricted Securities pursuant to a
Registration Statement exceeds the sum of (A) the amount paid by such Holder for
such Transfer Restricted Securities plus (B) the amount of any damages which
such Holder has otherwise been required to pay by reason of such 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 Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The obligations of the Initial Purchaser and the
Holders to contribute pursuant to this Section 8(c) are several in proportion to
the respective principal amount of Preferred Stock or Exchange Debentures held
by each of the Holders hereunder and not joint.
SECTION 9. RULE 144A
For so long as any Transfer Restricted Securities remain outstanding the
Company shall make available upon request of any Holder of Transfer restricted
Securities, to any 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 Act.
SECTION 10. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS
No Holder may participate in any Underwritten Registration hereunder
unless such Holder (a) agrees to sell such Holder's Transfer Restricted
Securities on the basis provided in any underwriting arrangements approved by
the Persons entitled hereunder to approve such arrangements and (b) completes
and executes all reasonable questionnaires, powers of attorney, indemnities,
underwriting agreements, lock-up letters and other documents required under the
terms of such underwriting arrangements.
17
SECTION 11. SELECTION OF UNDERWRITERS
For any Underwritten Offering of Transfer Restricted Securities, the
investment banker or investment bankers and manager or managers that will
administer such offering shall be selected by the Holders of a majority in
liquidation preference of Preferred Stock or aggregate principal amount of the
Exchange Debentures, as the case may be, included in such offering.
SECTION 12. MISCELLANEOUS
(a) Remedies. Each Holder, in addition to being entitled to exercise all
rights provided herein, in the Certificate of Designation, in the Exchange
Debenture Indenture, in the Purchase Agreement or granted by law, including
recovery of liquidated or other damages, shall be entitled to specific
performance of its rights under this Agreement. The Company agrees that monetary
damages (including the liquidated damages contemplated hereby) would not be
adequate compensation for any loss incurred by reason of a breach by it of the
provisions of this Agreement and hereby agrees to waive the defense in any
action for specific performance that a remedy at law would be adequate.
(b) No Inconsistent Agreements. The Company shall not 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. The Company represents that the rights granted to the Holders
hereunder do not in any way conflict with and are not inconsistent with the
rights granted to the holders of the Company's securities under any agreement in
effect on the date hereof.
(c) Adjustments Affecting the Preferred Stock or Exchange Debentures. The
Company shall not take any action, or permit any change to occur, with respect
to the Preferred Stock or the Exchange Debentures that would materially and
adversely affect the ability of the Holders to Consummate any Exchange Offer.
(d) Amendments and Waivers. The provisions of 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 (i) in the case of Section 5
hereof and this Section 12(D)(i), the Company has obtained the written consent
of the Holders of all outstanding Transfer Restricted Securities and (ii) in the
case of all other provisions hereof, the Company has obtained the written
consent of Holders of a majority in liquidation preference of Preferred Stock or
aggregate principal amount of Exchange Debentures, as the case may be.
Notwithstanding the foregoing, a waiver or consent to departure from the
provisions hereof that relates exclusively to the rights of Holders whose
securities are being tendered pursuant to the Exchange Offer and that does not
affect directly or indirectly the rights of other Holders whose securities are
not being tendered pursuant to such Exchange Offer may be given by the Holders
of a majority in liquidation preference of Preferred Stock or aggregate
principal amount of Exchange Debentures, as the case may be, tendered pursuant
to such Exchange Offer.
(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, telecopier, or air
courier guaranteeing overnight delivery:
(i) if to a Holder, at the address set forth on the records of the
Transfer Agent or the Trustee, as the case may be, with a copy to the
Transfer Agent or the Trustee, as the case may be; and
18
(ii) if to the Company:
Petroleum Heat and Power Co., Inc.,
2187 Atlantic Street,
Stamford, Connecticut 06904
Telecopier No.: (203) 328-7422
Attention: Irik P. Sevin
With a copy to:
Phillips Nizer Benjamin Krim & Balloon LLP
666 Fifth Avenue
New York, New York 10019
Telecopier No.: (212) 262-5152
Attention: Alan Shapiro
All 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 receipt
acknowledged, if telecopied; and on the next Business Day, if timely delivered
to an air courier guaranteeing overnight delivery.
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Transfer Agent or
the Trustee at the addresses specified in the Certificate of Designation and
Exchange Debenture Indenture, respectively.
(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.
(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) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK AS APPLIED TO
CONTRACTS MADE AND PERFORMED ENTIRELY WITHIN THE STATE OF NEW YORK.
(j) Severability. In the event that 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.
(k) Entire Agreement. This Agreement together with the other Operative
Documents (as defined in the Purchase 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
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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.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
PETROLEUM HEAT AND POWER CO., INC.
By: _______________________________
Name: George Leibowitz
Title: Senior Vice President-Finance
DONALDSON, LUFKIN & JENRETTE
Securities Corporation
By: _______________________________
Name: Philippe Jacob
Title: Vice President