Execution Copy
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT is made and entered into as of April 30,
2001 by and between Stilwell Financial Inc., a Delaware corporation (the
"Company"), and Merrill Lynch & Co., Merrill Lynch, Pierce, Fenner & Smith
Incorporated (the "Initial Purchaser") pursuant to the Purchase Agreement, dated
as of April 25, 2001 (the "Purchase Agreement"), between the Company and the
Initial Purchaser. In order to induce the Initial Purchaser to enter into the
Purchase Agreement, the Company has agreed to provide the registration rights
set forth in this Agreement. The execution of this Agreement is a condition to
the closing under the Purchase Agreement.
The Company agrees with the Initial Purchaser, (i) for the benefit of the
Initial Purchaser and (ii) for the benefit of the beneficial owners (including
the Initial Purchaser) from time to time of the Securities (as defined herein)
and the beneficial owners from time to time of the Underlying Common Stock (as
defined herein) issued upon conversion of the Securities (each of the foregoing
a "Holder" and together the "Holders"), as follows:
Section 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 terms shall have the following meanings:
"Affiliate" means, with respect to any specified person, an "affiliate," as
defined in Rule 144, of such person.
"Applicable Conversion Price" means, as of any date of determination, (A)
the Applicable Principal Amount per $1,000 principal amount at maturity of
Securities as of such date of determination or, (B) if the Securities have been
converted to semiannual coupon notes upon a Tax Event (as defined in the
Indenture) pursuant to Section 10.01 of the Indenture, the Restated Principal
Amount (as defined in the Indenture), divided by the Conversion Rate in effect
as of such date of determination or, if no Securities are then outstanding, the
Conversion Rate that would be in effect were Securities then outstanding.
"Applicable Principal Amount" means, as of any date of determination, (A)
with respect to each $1,000 principal amount at maturity of Securities, (i) the
sum of the initial issue price of such Securities ($930,709,000) plus accrued
original issue discount with respect to such Securities through such date of
determination or (ii) if no Securities are then outstanding, such sum calculated
as if such Securities were then outstanding, or (B) if the Securities have been
converted to semiannual coupon notes upon a Tax Event (as defined in the
Indenture) pursuant to Section 10.01 of the Indenture, the Restated Principal
Amount (as defined in the Indenture)].
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and Friday
that is not a day on which banking institutions in The City of New York are
authorized or obligated by law or executive order to close.
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"Common Stock" means any shares of Common Stock, par value $.01 per share,
of the Company and any other shares of common stock as may constitute "Common
Stock" for purposes of the Indenture, including the Underlying Common Stock.
"Conversion Rate" has the meaning assigned to that term in the Indenture.
"Damages Accrual Period" has the meaning specified in Section 2(e) hereof.
"Damages Payment Date" means each April 30 and October 30 in the case of
Securities and the Underlying Common Stock.
"Deferral Notice" has the meaning specified in Section 3(i) hereof.
"Deferral Period" has the meaning specified in Section 3(i) hereof.
"Effectiveness Deadline Date" has the meaning specified in Section 2(a)
hereof.
"Effectiveness Period" means the period of two years from the date the
Shelf Registration Statement is declared effective or such shorter period ending
on the date that all Registrable Securities have ceased to be Registrable
Securities.
"Event" has the meaning specified in Section 2(e) hereof.
"Event Termination Date" has the meaning specified in Section 2(e) hereof.
"Event Date" has the meaning specified in Section 2(e) hereof.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, and
the rules and regulations of the SEC promulgated thereunder.
"Filing Deadline Date" has the meaning specified in Section 2(a) hereof.
"Holder" has the meaning specified in the second paragraph of this
Agreement.
"Indenture" means the Indenture dated as of the date hereof between the
Company and the Trustee, pursuant to which the Securities are being issued.
"Initial Purchaser" means Merrill Lynch & Co., Merrill Lynch, Pierce,
Fenner & Smith Incorporated.
"Initial Shelf Registration Statement" has the meaning specified in Section
2(a) hereof.
"Issue Date" means April 30, 2001.
"Liquidated Damages Amount" has the meaning specified in Section 2(e)
hereof.
"Material Event" has the meaning specified in Section 3(i) hereof.
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"Notice and Questionnaire" means a written notice delivered to the Company
containing substantially the information called for by the Selling
Securityholder Notice and Questionnaire attached as Annex A to the Offering
Memorandum of the Company dated April 25, 2001 relating to the Securities.
"Notice Holder" means, on any date, any Holder that has delivered a Notice
and Questionnaire to the Company on or prior to such date.
"person" shall mean a corporation, association, partnership, organization,
business, individual, government or political subdivision thereof or
governmental agency.
"Prospectus" means 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 promulgated under the Securities Act), as
amended or supplemented by any amendment or prospectus supplement, including
post-effective amendments, and all materials incorporated by reference or
explicitly deemed to be incorporated by reference in such Prospectus.
"Purchase Agreement" has the meaning specified in the first paragraph of
this Agreement.
"Record Holder" means, with respect to any Damages Payment Date relating to
any Securities or Underlying Common Stock as to which any Liquidated Damages
Amount has accrued, the registered holder of such Securities or Underlying
Common Stock, as the case may be, 15 days prior to such Damages Payment Date.
"Registrable Securities" means the Securities and the Underlying Common
Stock, until such securities have been converted or exchanged, and, at all times
subsequent to any such conversion or exchange, any securities into or for which
such securities have been converted or exchanged, and any security issued with
respect thereto upon any stock dividend, split or similar event until, in the
case of any such security, the earliest of (i) its effective registration under
the Securities Act and resale in accordance with the Registration Statement
covering it, (ii) expiration of the holding period that would be applicable
thereto under Rule 144(k) were it not held by an Affiliate of the Company or
(iii) its sale to the public pursuant to Rule 144.
"Registration Expenses" has the meaning specified in Section 5 hereof.
"Registration Statement" means any registration statement of the Company
that covers any of the Registrable Securities pursuant to the provisions of this
Agreement, including the Prospectus, amendments and supplements to such
registration statement, including post-effective amendments, all exhibits, and
all materials incorporated by reference or explicitly deemed to be incorporated
by reference in such registration statement.
"Restricted Securities" has the meaning assigned to that term in Rule 144.
"Rule 144" means Rule 144 under the Securities Act, as such Rule may be amended
from time to time, or any similar rule or regulation hereafter adopted by the
SEC.
"Rule 144A" means Rule 144A under the Securities Act, as such Rule may be
amended from time to time, or any similar rule or regulation hereafter adopted
by the SEC.
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"SEC" means the U.S. Securities and Exchange Commission and any successor
agency.
"Securities" means the Liquid Yield Option(TM) Notes due 2031 of the
Company to be purchased pursuant to the Purchase Agreement or, if the Securities
have been converted to semiannual coupon notes upon a Tax Event (as defined in
the Indenture), such semiannual coupon notes.
"Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated by the SEC thereunder.
"Shelf Registration Statement" has the meaning specified in Section 2(a)
hereof.
"Subsequent Shelf Registration Statement" has the meaning specified in
Section 2(b) hereof.
"TIA" means the Trust Indenture Act of 1939, as amended.
"Trustee" means The Chase Manhattan Bank, a New York banking corporation
(or any successor entity), the Trustee under the Indenture.
"Underlying Common Stock" means the Common Stock into which the Securities
are convertible or issued upon any such conversion.
Section 2. Shelf Registration. (a) The Company shall prepare and file or
cause to be prepared and filed with the SEC, as soon as practicable but in any
event by the date that is ninety (90) days after the Issue Date (the "Filing
Deadline Date"), a Registration Statement for an offering to be made on a
delayed or continuous basis pursuant to Rule 415 of the Securities Act (a "Shelf
Registration Statement") registering the resale from time to time by Holders
thereof of all of the Registrable Securities (the "Initial Shelf Registration
Statement"). The Initial Shelf Registration Statement shall be on Form S-3 or
another appropriate form permitting registration of such Registrable Securities
for resale by such Holders in accordance with the methods of distribution
elected by the Holders and set forth in the Initial Shelf Registration
Statement, provided that in no event will such method(s) of distribution take
the form of an underwritten offering of the Registrable Securities without the
prior agreement of the Company. The Company shall use reasonable efforts to
cause the Initial Shelf Registration Statement to be declared effective under
the Securities Act as promptly as is practicable but in any event by the date
that is two hundred and ten (210) days after the Issue Date (the "Effectiveness
Deadline Date"), and to keep the Initial Shelf Registration Statement (or any
Subsequent Shelf Registration Statement) continuously effective under the
Securities Act until the expiration of the Effectiveness Period; provided,
however, that no Holder shall be entitled to have the Registrable Securities
held by it covered by such Shelf Registration Statement unless such Holder shall
have provided a Notice and Questionnaire in accordance with Section 2(d) and is
in compliance with Section 4. None of the Company's security holders (other than
the Holders
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of Registrable Securities) shall have the right to include any of the Company's
securities in the Shelf Registration Statement.
(b) If the Initial Shelf Registration Statement or any Subsequent Shelf
Registration Statement ceases to be effective for any reason at any time during
the Effectiveness Period (other than because all Registrable Securities
registered thereunder shall have been resold pursuant thereto or shall have
otherwise ceased to be Registrable Securities), the Company shall use reasonable
efforts to obtain the prompt withdrawal of any order suspending the
effectiveness thereof, and in any event shall within thirty (30) days of such
cessation of effectiveness amend the Shelf Registration Statement in a manner
reasonably expected to obtain the withdrawal of the order suspending the
effectiveness thereof, or file an additional Shelf Registration Statement
covering all of the securities that as of the date of such filing are
Registrable Securities (a "Subsequent Shelf Registration Statement"). If a
Subsequent Shelf Registration Statement is filed, the Company shall use
reasonable efforts to cause the Subsequent Shelf Registration Statement to
become effective as promptly as is practicable after such filing (or, if filed
during a Deferral Period, after the expiration of such Deferral Period) and to
keep such Subsequent Shelf Registration Statement continuously effective until
the end of the Effectiveness Period.
(c) The Company shall supplement and amend the Shelf Registration Statement
if required by the rules, regulations or instructions applicable to the
registration form used by the Company for such Shelf Registration Statement, if
required by the Securities Act or, to the extent to which the Company does not
reasonably object, as reasonably requested by the Initial Purchaser or by the
Trustee on behalf of the registered Holders.
(d) Each Holder of Registrable Securities agrees that if such Holder wishes
to sell Registrable Securities pursuant to a Shelf Registration Statement and
related Prospectus, it will do so only in accordance with this Section 2(d) and
Section 3(i). Each Holder of Registrable Securities wishing to sell Registrable
Securities pursuant to a Shelf Registration Statement and related Prospectus
agrees to deliver a Notice and Questionnaire to the Company at least five (5)
Business Days prior to any intended distribution of Registrable Securities under
the Shelf Registration Statement. From and after the date the Initial Shelf
Registration Statement is declared effective, the Company shall, (i)(A) as
promptly as is practicable after the date a Notice and Questionnaire is
delivered, but in any event within five (5) days after such date, if required by
applicable federal securities law, file with the SEC a post-effective amendment
to the Shelf Registration Statement or prepare and, if required by applicable
federal securities law, file a supplement to the related Prospectus or a
supplement or amendment to any document incorporated therein by reference or
file any other document required by the SEC so that the Holder delivering such
Notice and Questionnaire is named as a selling security holder in the Shelf
Registration Statement and the related Prospectus in such a manner as to permit
such Holder to deliver such Prospectus to purchasers of the Registrable
Securities in accordance with applicable law (other than laws not generally
applicable to all Holders of Registrable Securities wishing to sell Registrable
Securities pursuant to the Shelf Registration Statement and related Prospectus)
and, if the Company shall file a post-effective amendment to the Shelf
Registration Statement, (B) use reasonable efforts to cause such post-effective
amendment to be declared effective under the Securities Act as promptly as is
practicable; (ii) provide such Holder copies of any documents filed pursuant to
Section 2(d)(i); and (iii) notify such Holder as promptly as is reasonably
practicable after the effectiveness under the Securities Act of any post-
effective
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amendment filed pursuant to Section 2(d)(i); provided, that if such Notice and
Questionnaire is delivered during a Deferral Period, the Company shall so inform
the Holder delivering such Notice and Questionnaire and shall take the actions
set forth in clauses (i), (ii) and (iii) above upon expiration of the Deferral
Period in accordance with Section 3(i), provided, further, that if under
applicable law the Company has more than one option as to the type or manner of
making any such filing, as set forth in an opinion of a nationally recognized
counsel experienced in such matters delivered by the Holder to the Company, it
will make the required filing or filings in the manner or of a type that is
reasonably expected to result in the earliest availability of the Prospectus for
effecting resales of Registrable Securities. Notwithstanding anything contained
herein to the contrary, the Company shall be under no obligation to name any
Holder that is not a Notice Holder as a selling security holder in any
Registration Statement or related Prospectus; provided, however, that any Holder
that becomes a Notice Holder pursuant to the provisions of Section 2(d) of this
Agreement (whether or not such Holder was a Notice Holder at the time the
Registration Statement was initially declared effective) shall be named as a
selling security holder in the Registration Statement or related Prospectus
subject to and in accordance with the requirements of this Section 2(d).
(e) The parties hereto agree that the Holders of Registrable Securities
will suffer damages, and that it would not be feasible to ascertain the extent
of such damages with precision, if (i) the Initial Shelf Registration Statement
has not been filed on or prior to the Filing Deadline Date, (ii) the Initial
Shelf Registration Statement has not been declared effective under the
Securities Act on or prior to the Effectiveness Deadline Date, (iii) the Company
has failed to perform its obligations set forth in Section 2(d)(i)(A) hereof
within the time period required therein, or (iv) the aggregate duration of
Deferral Periods in any period exceeds the number of days permitted in respect
of such period pursuant to Section 3(i) hereof (each of the events of a type
described in any of the foregoing clauses (i) through (iv) are individually
referred to herein as an "Event," and the Filing Deadline Date in the case of
clause (i), the Effectiveness Deadline Date in the case of clause (ii), the date
by which the Company is required to perform its obligations set forth in Section
2(d)(i)(A) in the case of clause (iii), and the date on which the aggregate
duration of Deferral Periods in any period exceeds the number of days permitted
by Section 3(i) hereof in the case of clause (iv), being referred to herein as
an "Event Date"). Events shall be deemed to continue until the "Event
Termination Date," which shall be the following dates with respect to the
respective types of Events: the date the Initial Shelf Registration Statement is
filed in the case of an Event of the type described in clause (i), the date the
Initial Shelf Registration Statement is declared effective under the Securities
Act in the case of an Event of the type described in clause (ii), the date the
Company performs its obligations set forth in Section 2(d)(i)(A) in the case of
an Event of the type described in clause (iii), and termination of the Deferral
Period that caused the limit on the aggregate duration of Deferral Periods in a
period set forth in Section 3(i) to be exceeded in the case of an Event of the
type described in clause (iv).
Accordingly, commencing on (and including) any Event Date and ending on
(but excluding) the next date on which there are no Events that have occurred
and are continuing (a "Damages Accrual Period"), the Company agrees to pay, as
liquidated damages and not as a penalty, an amount (the "Liquidated Damages
Amount"), payable on the Damages Payment Dates to Record Holders of then
outstanding Securities that are Registrable Securities and of then outstanding
shares of Underlying Common Stock issued upon conversion of Securities that are
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Registrable Securities, as the case may be, accruing, for each portion of such
Damages Accrual Period beginning on and including a Damages Payment Date (or, in
respect of the first time that the Liquidation Damages Amount is to be paid to
Holders on a Damages Payment Date as a result of the occurrence of any
particular Event, from the Event Date) and ending on but excluding the first to
occur of (A) the date of the end of the Damages Accrual Period or (B) the next
Damages Payment Date, at a rate per annum equal to one-quarter of one percent
(0.25%) for the first 90-day period from the Event Date, and thereafter at a
rate per annum equal to one-half of one percent (0.5%) of the aggregate
Applicable Principal Amount of such Securities and the aggregate Applicable
Conversion Price of such shares of Underlying Common Stock, as the case may be,
in each case determined as of the Business Day immediately preceding the next
Damages Payment Date; provided, that in the case of a Damages Accrual Period
that is in effect solely as a result of an Event of the type described in clause
(iii) of the immediately preceding paragraph, such Liquidated Damages Amount
shall be paid only to the Holders that have delivered Notice and Questionnaires
that caused the Company to incur the obligations set forth in Section 2(d)(i)(A)
the non-performance of which is the basis of such Event; provided further, that
any Liquidated Damages Amount accrued with respect to any Securities or portion
thereof called for redemption on a redemption date or converted into Underlying
Common Stock on a conversion date prior to the Damages Payment Date, shall, in
any such event, be paid instead to the Holder who submitted such Securities or
portion thereof for redemption or conversion on the applicable redemption date
or conversion date, as the case may be, on such date (or promptly following the
conversion date, in the case of conversion). Notwithstanding the foregoing, no
Liquidated Damages Amounts shall accrue as to any Registrable Security from and
after the earlier of (x) the date such security is no longer a Registrable
Security and (y) expiration of the Effectiveness Period. The rate of accrual of
the Liquidated Damages Amount with respect to any period shall not exceed the
rate provided for in this paragraph notwithstanding the occurrence of multiple
concurrent Events. Following the cure of all Events requiring the payment by the
Company of Liquidated Damages Amounts to the Holders of Registrable Securities
pursuant to this Section, the accrual of Liquidated Damages Amounts will cease
(without in any way limiting the effect of any subsequent Event requiring the
payment of Liquidated Damages Amount by the Company).
The Trustee shall be entitled, on behalf of Holders of Securities or
Underlying Common Stock, to seek any available remedy for the enforcement of
this Agreement, including for the payment of any Liquidated Damages Amount.
Notwithstanding the foregoing, the parties agree that the sole monetary damages
payable for a violation of the terms of this Agreement with respect to which
liquidated damages are expressly provided shall be such liquidated damages.
Nothing shall preclude a Notice Holder or Holder of Registrable Securities from
pursuing or obtaining specific performance or other equitable relief with
respect to this Agreement.
All of the Company's obligations set forth in this Section 2(e) that are
outstanding with respect to any Registrable Security at the time such security
ceases to be a Registrable Security shall survive until such time as all such
obligations with respect to such security have been satisfied in full
(notwithstanding termination of this Agreement pursuant to Section 9(k)).
The parties hereto agree that the liquidated damages provided for in this
Section 2(e) constitute a reasonable estimate of the damages that may be
incurred by Holders of Registrable Securities by reason of the failure of the
Shelf Registration Statement to be filed or
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declared effective or available for effecting resales of Registrable Securities
in accordance with the provisions hereof.
Section 3. Registration Procedures. In connection with the registration
obligations of the Company under Section 2 hereof, the Company shall:
(a) Before filing any Registration Statement or Prospectus or any
amendments or supplements (other than supplements solely for the purpose of
naming one or more Notice Holders as selling security holders) thereto with the
SEC, furnish to the Initial Purchaser copies of all such documents proposed to
be filed and use reasonable efforts to reflect in each such document when so
filed with the SEC such comments as the Initial Purchaser reasonably shall
propose within three (3) Business Days of the delivery of such copies to the
Initial Purchaser.
(b) Prepare and file with the SEC such amendments and post-effective
amendments to each Registration Statement as may be necessary to keep such
Registration Statement continuously effective for the applicable period
specified in Section 2(a); cause the related Prospectus to be supplemented by
any required Prospectus supplement, and as so supplemented to be filed pursuant
to Rule 424 (or any similar provisions then in force) under the Securities Act;
and use reasonable efforts to comply with the provisions of the Securities Act
applicable to it with respect to the disposition of all securities covered by
such Registration Statement during the Effectiveness Period in accordance with
the intended methods of disposition by the sellers thereof set forth in such
Registration Statement as so amended or such Prospectus as so supplemented.
(c) As promptly as practicable give notice to the Notice Holders and the
Initial Purchaser (i) when any Prospectus, Prospectus supplement, Registration
Statement or post-effective amendment to a Registration Statement has been filed
with the SEC and, with respect to a Registration Statement or any post-effective
amendment, when the same has been declared effective (provided, however, that
the Company shall not be required by this clause (i) to notify the Initial
Purchaser or any Notice Holder of the filing of a Prospectus supplement solely
for the purpose of naming one or more Notice Holders as selling security
holders), (ii) of any request, following the effectiveness of the Initial Shelf
Registration Statement under the Securities Act, by the SEC or any other federal
or state governmental authority for amendments or supplements to any
Registration Statement or related Prospectus or for additional information,
(iii) of the issuance by the SEC or any other federal or state governmental
authority of any stop order suspending the effectiveness of any Registration
Statement or the initiation or threatening of any proceedings for that purpose,
(iv) of the receipt by the Company of any notification with respect to the
suspension of the qualification or exemption from qualification of any of the
Registrable Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose, (v) of the occurrence of (but
not the nature of or details concerning) a Material Event (provided, however,
that no notice by the Company shall be required pursuant to this clause (v) in
the event that the Company either promptly files a Prospectus supplement to
update the Prospectus or a Form 8-K or other appropriate Exchange Act report
that is incorporated by reference into the Registration Statement, which, in
either case, contains the requisite information with respect to such Material
Event that results in such Registration Statement no longer containing any
untrue statement of material fact or omitting to state a material fact necessary
to make the statements contained therein not misleading) and (vi) of the
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determination by the Company that a post-effective amendment to a Registration
Statement will be filed with the SEC, which notice may, at the discretion of the
Company (or as required pursuant to Section 3(i)), state that it constitutes a
Deferral Notice, in which event the provisions of Section 3(i) shall apply.
(d) Use reasonable efforts to obtain the withdrawal of any order suspending
the effectiveness of a Registration Statement or the lifting of any suspension
of the qualification (or exemption from qualification) of any of the Registrable
Securities for sale in any jurisdiction in which they have been qualified for
sale, in either case at the earliest possible moment or, if any such order or
suspension is made effective during any Deferral Period, at the earliest
possible moment after the expiration of such Deferral Period.
(e) If reasonably requested by the Initial Purchaser or any Notice Holder,
promptly as reasonably practicable incorporate in a Prospectus supplement or
post-effective amendment to a Registration Statement such information as the
Initial Purchaser or such Notice Holder shall, on the basis of a written opinion
of nationally-recognized counsel experienced in such matters, determine to be
required to be included therein by applicable federal securities law and make
any required filings of such Prospectus supplement or such post-effective
amendment; provided, that the Company shall not be required to take any actions
under this Section 3(e) that are not, in the reasonable opinion of counsel for
the Company, in compliance with applicable law.
(f) As promptly as reasonably practicable furnish to each Notice Holder and
the Initial Purchaser, upon their request and without charge, at least one (1)
conformed copy of the Registration Statement and any amendment thereto,
including financial statements but excluding schedules, all documents
incorporated or deemed to be incorporated therein by reference and all exhibits
(unless requested in writing to the Company by such Notice Holder or the Initial
Purchaser, as the case may be).
(g) During the Effectiveness Period, deliver to each Notice Holder in
connection with any sale of Registrable Securities pursuant to a Registration
Statement, without charge, as many copies of the Prospectus or Prospectuses
relating to such Registrable Securities (including each preliminary prospectus)
and any amendment or supplement thereto as such Notice Holder may reasonably
request; and the Company hereby consents (except during such periods that a
Deferral Notice is outstanding and has not been revoked) to the use of such
Prospectus or each amendment or supplement thereto by each Notice Holder in
connection with any offering and sale of the Registrable Securities covered by
such Prospectus or any amendment or supplement thereto in the manner set forth
therein.
(h) Prior to any public offering of the Registrable Securities pursuant to
the Shelf Registration Statement, use reasonable efforts to register or qualify
or cooperate with the Notice Holders in connection with the registration or
qualification (or exemption from such registration or qualification) of such
Registrable Securities for offer and sale under the securities or Blue Sky laws
of such jurisdictions within the United States as any Notice Holder reasonably
requests in writing (which request may be included in the Notice and
Questionnaire), it being agreed that no such registration or qualification will
be made unless so requested; prior to any public offering of the Registrable
Securities pursuant to the Shelf Registration Statement, use
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reasonable efforts to keep each such registration or qualification (or exemption
therefrom) effective during the Effectiveness Period in connection with such
Notice Holder's offer and sale of Registrable Securities pursuant to such
registration or qualification (or exemption therefrom) and do any and all other
acts or things necessary to enable the disposition in such jurisdictions of such
Registrable Securities in the manner set forth in the relevant Registration
Statement and the related Prospectus; provided, that the Company will not be
required to (i) qualify as a foreign corporation or as a dealer in securities in
any jurisdiction where it would not otherwise be required to qualify but for
this Agreement or (ii) take any action that would subject it to general service
of process in suits or to taxation in any such jurisdiction where it is not then
so subject.
(i) Upon (A) the issuance by the SEC of a stop order suspending the
effectiveness of the Shelf Registration Statement or the initiation of
proceedings with respect to the Shelf Registration Statement under Section 8(d)
or 8(e) of the Securities Act, (B) the occurrence of any event or the existence
of any fact (a "Material Event") as a result of which any Registration Statement
shall contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading, or any Prospectus shall contain any untrue statement of
a material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading (including, in any such case, as a
result of the non-availability of financial statements), or (C) the occurrence
or existence of any pending corporate development that, in the discretion of the
Company, makes it appropriate to suspend the availability of the Shelf
Registration Statement and the related Prospectus, (i) in the case of clause (B)
above, subject to the next sentence, as promptly as practicable prepare and file
a post-effective amendment to such Registration Statement or a supplement to the
related Prospectus or any document incorporated therein by reference or file any
other required document that would be incorporated by reference into such
Registration Statement and Prospectus so that such Registration Statement does
not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading, and such Prospectus does not contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, as thereafter
delivered to the purchasers of the Registrable Securities being sold thereunder,
and, in the case of a post-effective amendment to a Registration Statement,
subject to the next sentence, use all reasonable efforts to cause it to be
declared effective as promptly as is reasonably practicable, and (ii) give
notice to the Notice Holders that the availability of the Shelf Registration
Statement is suspended (a "Deferral Notice") and, upon receipt of any Deferral
Notice, each Notice Holder agrees not to sell any Registrable Securities
pursuant to the Registration Statement until such Notice Holder's receipt of
copies of the supplemented or amended Prospectus provided for in clause (i)
above, or until it is advised in writing by the Company that the Prospectus may
be used, and has received copies of any additional or supplemental filings that
are incorporated or deemed incorporated by reference in such Prospectus. The
Company will use reasonable efforts to ensure that the use of the Prospectus may
be resumed (x) in the case of clause (A) above, as promptly as is practicable,
(y) in the case of clause (B) above, as soon as, in the sole judgment of the
Company, public disclosure of such Material Event would not be prejudicial to or
contrary to the interests of the Company or, if necessary to avoid unreasonable
burden or expense, as soon as reasonably
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practicable thereafter and (z) in the case of clause (C) above, as soon as, in
the discretion of the Company, such suspension is no longer appropriate. The
period during which the availability of the Registration Statement and any
Prospectus is suspended (the "Deferral Period") shall, without the Company
incurring any obligation to pay liquidated damages pursuant to Section 2(e), not
exceed forty-five (45) days in any three (3) month period and ninety (90) days
in any twelve (12) month period.
(j) If reasonably requested in writing in connection with a disposition of
Registrable Securities pursuant to a Registration Statement, make reasonably
available for inspection during normal business hours by a representative for
the Notice Holders of such Registrable Securities and any broker-dealers,
attorneys and accountants retained by such Notice Holders, all relevant
financial and other records, pertinent corporate documents and properties of the
Company and its subsidiaries, and cause the appropriate executive officers,
directors and designated employees of the Company and its subsidiaries to make
reasonably available for inspection during normal business hours all relevant
information reasonably requested by such representative for the Notice Holders
or any such broker-dealers, attorneys or accountants in connection with such
disposition, in each case as is customary for similar "due diligence"
examinations; provided, however, that such persons shall first agree in writing
with the Company that any information that is reasonably and in good faith
designated by the Company in writing as confidential at the time of delivery of
such information shall be kept confidential by such persons and shall be used
solely for the purposes of exercising rights under this Agreement, unless (i)
disclosure of such information is required by court or administrative order or
is necessary to respond to inquiries of regulatory authorities, (ii) disclosure
of such information is required by law (including any disclosure requirements
pursuant to federal securities laws in connection with the filing of any
Registration Statement or the use of any Prospectus referred to in this
Agreement), (iii) such information becomes generally available to the public
other than as a result of a disclosure or failure to safeguard by any such
person or (iv) such information becomes available to any such person from a
source other than the Company and such source is not (to the knowledge of such
person) bound by a confidentiality agreement; and provided further, that the
foregoing inspection and information gathering shall, to the greatest extent
reasonably possible, be coordinated on behalf of all the Notice Holders and the
other parties entitled thereto by the counsel referred to in Section 5,
including the designation of a common broker-dealer, attorney and accountant
acceptable to all such Notice Holders to act as their representative.
(k) Comply with all applicable rules and regulations of the SEC and make
generally available to its securityholders earning statements (which need not be
audited) satisfying the provisions of Section 11(a) of the Securities Act and
Rule 158 thereunder (or any similar rule promulgated under the Securities Act)
no later than 45 days after the end of any 12-month period (or 90 days after the
end of any 12-month period if such period is a fiscal year) commencing on the
first day of the first fiscal quarter of the Company commencing after the
effective date of a Registration Statement, which statements shall cover said
12-month periods.
(l) Cooperate with each Notice Holder to facilitate the timely preparation
and delivery of certificates representing Registrable Securities sold pursuant
to a Registration Statement, and cause such Registrable Securities to be in such
denominations as are permitted by
11
the Indenture and registered in such names as such Notice Holder may request in
writing at least two Business Days prior to any sale of such Registrable
Securities.
(m) Provide a CUSIP number for all Registrable Securities covered by each
Registration Statement not later than the effective date of such Registration
Statement and provide the Trustee for the Securities and the transfer agent for
the Securities with printed certificates for the Registrable Securities that are
in a form eligible for deposit with The Depository Trust Company.
(n) Make a reasonable effort to provide such information as is required for
any filings required to be made with the National Association of Securities
Dealers, Inc.
(o) Upon (i) the filing of the Initial Shelf Registration Statement and
(ii) the effectiveness of the Initial Shelf Registration Statement, announce the
same, in each case by release to Businesswire or other equivalent means of
dissemination reasonably expected to make such information known publicly.
(p) Enter into such customary agreements and take all such other reasonable
necessary actions in connection therewith (including those reasonably requested
by the holders of a majority of the Registrable Securities being sold) in order
to expedite or facilitate disposition of such Registrable Securities, provided
that the Company shall not be required to take any action in connection with an
underwritten offering without its consent.
(q) Cause the Indenture to be qualified under the TIA not later than the
effective date of any Registration Statement; and in connection therewith,
cooperate with the Trustee to effect such changes to the Indenture as may be
required for the Indenture to be so qualified in accordance with the terms of
the TIA and execute, and use reasonable efforts to cause the Trustee to execute,
all documents as may be required to effect such changes, and all other forms and
documents required to be filed with the SEC to enable the Indenture to be so
qualified in a timely manner.
Section 4. Holder's Obligations. Each Holder agrees, by acquisition of the
Registrable Securities, that no Holder of Registrable Securities shall be
entitled to sell any of such Registrable Securities pursuant to a Registration
Statement or to receive a Prospectus relating thereto, unless such Holder has
furnished the Company with a Notice and Questionnaire as required pursuant to
Section 2(d) hereof (including the information required to be included in such
Notice and Questionnaire) and the information set forth in the next sentence.
Each Notice Holder agrees promptly to furnish to the Company all information
required to be disclosed in order to make the information previously furnished
to the Company by such Notice Holder not misleading and any other information
regarding such Notice Holder and the distribution of such Registrable Securities
as may be required to be disclosed in the Registration Statement under
applicable law or pursuant to SEC comments or requests, and any information
reasonably required by the Company to comply with applicable law or regulation,
based on the advice of counsel. Each Holder further agrees, following the
termination of the Effectiveness Period, to notify the Company within ten (10)
Business Days of request, of the amount of Registrable Securities sold pursuant
to the Registration Statement.
12
Section 5. Registration Expenses. The Company shall bear all fees and
expenses incurred in connection with the performance by the Company of its
obligations under Sections 2 and 3 of this Agreement whether or not any of the
Registration Statements are declared effective. Such fees and expenses shall
include, without limitation, (i) all registration and filing fees (including,
without limitation, fees and expenses (x) with respect to filings required to be
made with the National Association of Securities Dealers, Inc. and (y) of
compliance with federal and state securities or Blue Sky laws to the extent such
filings or compliance are required pursuant to this Agreement (including,
without limitation, reasonable fees and disbursements of the counsel specified
in the next sentence in connection with Blue Sky qualifications of the
Registrable Securities under the laws of such jurisdictions as the Notice
Holders of a majority of the Registrable Securities being sold pursuant to a
Registration Statement may designate)), (ii) printing expenses (including,
without limitation, expenses of printing certificates for Registrable Securities
in a form eligible for deposit with The Depository Trust Company), (iii)
duplication expenses relating to copies of any Registration Statement or
Prospectus delivered to any Holders hereunder, (iv) fees and disbursements of
counsel for the Company in connection with the Shelf Registration Statement, and
(v) reasonable fees and disbursements of the Trustee and its counsel and of the
registrar and transfer agent for the Common Stock. In addition, the Company
shall bear or reimburse the Notice Holders for the reasonable fees and
disbursements of one firm of legal counsel for the Holders, which shall
initially be Cleary Gottlieb Steen & Hamilton, but which may, upon the written
consent of the Initial Purchaser (which shall not be unreasonably withheld), be
another nationally recognized law firm experienced in securities law matters
designated by the Company. In addition, the Company shall pay the internal
expenses of the Company (including, without limitation, all salaries and
expenses of officers and employees performing legal or accounting duties), the
expense of any annual audit, the fees and expenses incurred in connection with
the listing of the Registrable Securities on any securities exchange on which
similar securities of the Company are then listed and the fees and expenses of
any person, including special experts, retained by the Company.
Section 6. Representations and Warranties. The Company represents and
warrants to, and agrees with, the Initial Purchaser and each of the Holders from
time to time of Registrable Securities that:
(a) Each registration statement covering Registrable Securities and each
Prospectus contained therein or furnished pursuant to Section 3(f) and (g)
hereof and any further amendments or supplements to any such registration
statement or Prospectus, when it becomes effective with the SEC, as the case may
be, and, in the case of an underwritten offering of Registrable Securities, at
the time of the closing under the underwriting agreement relating thereto, will
conform in all material respects to the applicable requirements of the
Securities Act and the TIA and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; and at all times
subsequent to the time and date the Shelf Registration is declared effective
when a Prospectus would be required to be delivered under the Securities Act,
other than during a Deferral Period in accordance with Section 3(i) hereof or
from (i) such time as a notice has been given to Holders of Registrable
Securities pursuant to Section 3(c)(v) hereof until (ii) such time as the
Company furnishes an amended or supplemented Prospectus pursuant to Section 3(g)
hereof or such time as the Company provides notice that offers and sales
pursuant to the Shelf
13
Registration may continue, each such registration statement, and each Prospectus
(including any summary Prospectus) contained therein or furnished pursuant to
Section 3 hereof, as then amended or supplemented, will conform in all material
respects to the applicable requirements of the Securities Act and the TIA;
provided, however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with information
furnished in writing to the Company (including in a Notice and Questionnaire) by
or on behalf of a Holder of Registrable Securities expressly for use therein.
(b) Any documents incorporated by reference in any Prospectus referred to
in Section 6(a) hereof, when they become or became effective or are or were
filed with the SEC, as the case may be, will conform or conformed in all
material respects to the requirements of the Securities Act or the Exchange Act,
as applicable, and none of such documents will contain or contained an untrue
statement of a material fact or will omit or omitted to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading, provided, however, that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in conformity
with information furnished in writing to the Company (including in a Notice and
Questionnaire) by a Holder of Registrable Securities expressly for use therein.
(c) The execution, delivery and performance by the Company of this
Agreement, and compliance by the Company with the terms hereof and the
consummation of the transactions contemplated hereby, will not conflict with or
result in a breach or violation of any of the terms or provisions of, or
constitute a default under, or result in the creation or imposition of any lien,
charge or encumbrance which is material to the Company and its Subsidiaries,
taken as a whole, upon any property or assets of the Company or any of its
Subsidiaries pursuant to, any agreement or instrument which is material to the
Company and its Subsidiaries, taken as a whole, to which the Company or any of
its Subsidiaries is a party or by which the Company or any of its Subsidiaries
is bound or to which any of the property or assets of the Company or any of its
Subsidiaries is subject, nor will such actions result in any violation of the
provisions of the charter or by-laws of the Company or any of its Subsidiaries
or any statute or any judgment, order, decree, rule or regulation which is
material to the Company and its Subsidiaries, taken as a whole, of any court or
arbitrator or governmental agency or body having jurisdiction over the Company
or any of its Subsidiaries or any of their respective properties or assets; and
no consent, approval, authorization or order of, or filing or registration with,
any such court or arbitrator or governmental agency or body under any such
statute, judgment, order, decree, rule or regulation is required for the
execution, delivery and performance by the Company of this Agreement and
compliance by the Company with the terms hereof and the consummation of the
transactions contemplated by this Agreement, except for such consents,
approvals, authorizations, filings, registrations or qualifications (i) which
shall have been obtained or made prior to the Issue Date and (ii) as may be
required to be obtained or made under the Securities Act and applicable state
securities laws.
(d) This Agreement has been duly authorized, executed and delivered by the
Company and constitutes a legal, valid and binding agreement of the Company,
enforceable against the Company in accordance with its terms, except as the
enforcement thereof may be limited by bankruptcy, insolvency (including, without
limitation, all laws relating to fraudulent transfers), reorganization,
moratorium or other similar laws relating to or affecting enforcement
14
of creditor's rights generally, or by general principles of equity (including,
without limitation, concepts of materiality, reasonableness, good faith and fair
dealing) regardless of whether enforcement is considered in a proceeding in
equity or at law.
Section 7. Indemnification; Contribution. (a) The Company agrees to
indemnify and hold harmless the Initial Purchaser and each holder of Registrable
Securities and each person, if any, who controls the Initial Purchaser or any
holder of Registrable Securities within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement
(or any amendment thereto), or the omission or alleged omission therefrom
of a material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading or
arising out of any untrue statement or alleged untrue statement of a
material fact included in any preliminary prospectus or the Prospectus (or
any amendment or supplement thereto), or the omission or alleged omission
therefrom of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, provided that (subject to Section
7(d) below) any such settlement is effected with the prior written consent
of the Company; and
(iii) subject to Section 7(c) below, against any and all expense
whatsoever, as incurred (including the fees and disbursements of counsel),
reasonably incurred in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental agency
or body, commenced or threatened, or any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue statement or
omission, to the extent that any such expense is not paid under (i) or (ii)
above;
provided, however, that this indemnity shall not apply to any loss, liability,
claim, damage or expense to the extent arising out of any untrue statement or
omission or alleged untrue statement or omission made in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
Initial Purchaser or such holder of Registrable Securities (which also
acknowledges the indemnity provisions herein) and each person, if any, who
controls the Initial Purchaser or any such holder of Registrable Securities
expressly for use in the Registration Statement (or any amendment thereto), or
any preliminary prospectus or the Prospectus (or any amendment or supplement
thereto); provided further, that this indemnity agreement shall not apply to any
loss, liability, claim, damage or expense (1) arising from an offer or sale of
Registrable Securities occurring during a Deferral Period, if the indemnified
party is a Notice
15
Holder that received a Deferral Notice, or (2) if the Holder fails to deliver at
or prior to written confirmation of sale, the most recent prospectus, as amended
or supplemented, and such Prospectus, as amended or supplemented, would have
corrected such untrue statement or omission or alleged untrue statement or
omission of a material fact.
This indemnity agreement will be in addition to any liability which the Company
may otherwise have.
(b) In connection with any Shelf Registration in which a holder, including,
without limitation, the Initial Purchaser, of Registrable Securities is
participating, in furnishing information relating to such holder of Registrable
Securities to the Company in writing expressly for use in such Registration
Statement, any preliminary prospectus, the Prospectus or any amendments or
supplements thereto, the holders of such Registrable Securities agree, severally
and not jointly, to indemnify and hold harmless the Initial Purchaser and each
person, if any, who controls the Initial Purchaser within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act and the
Company, and each person, if any, who controls the Company within the meaning of
either such Section, against any and all loss, liability, claim, damage and
expense described in the indemnity contained in subsection (a) of this Section,
as incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration Statement (or any
amendment thereto), or any preliminary prospectus or the Prospectus (or any
amendment or supplement thereto) in reliance upon and in conformity with written
information furnished to the Company by or on behalf of such holder of
Registrable Securities (which also acknowledges the indemnity provisions herein)
and each person, if any, who controls any such holder of Registrable Securities
expressly for use in the Registration Statement (or any amendment thereto) or
such preliminary prospectus or the Prospectus (or any amendment or supplement
thereto).
The Initial Purchaser agrees to indemnify and hold harmless the Company,
the holders of Registrable Securities, and each person, if any, who controls the
Company or any holder of Registrable Securities within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act against any
and all loss, liability, claim, damage and expense described in the indemnity
contained in subsection (a) of this Section, as incurred, but only with respect
to untrue statements or omissions, or alleged untrue statements or omissions,
made in the Registration Statement (or any amendment thereto), or any
preliminary prospectus or the Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with written information furnished
to the Company by the or on behalf of Initial Purchaser expressly for use in the
Registration Statement (or any amendment thereto) or such preliminary prospectus
or the Prospectus (or any amendment or supplement thereto).
(c) Each indemnified party shall give notice as promptly as reasonably
practicable to each indemnifying party of any action commenced against it in
respect of which indemnity may be sought hereunder, but failure to so notify an
indemnifying party shall not relieve such indemnifying party from any liability
hereunder to the extent it is not materially prejudiced as a result thereof and
in any event shall not relieve it from any liability which it may have otherwise
than on account of this indemnity agreement. An indemnifying party may
participate at its own expense in the defense of any such action; provided,
however, that counsel to the indemnifying party shall not (except with the
consent of the indemnified party) also be
16
counsel to the indemnified party. In no event shall the indemnifying parties be
liable for fees and expenses of more than one counsel (in addition to any local
counsel) separate from their own counsel for all indemnified parties in
connection with any one action or separate but similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances.
No indemnifying party shall, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any litigation, or any investigation or proceeding by
any governmental agency or body, commenced or threatened, or any claim
whatsoever in respect of which indemnification or contribution could be sought
under this Section 7 hereof (whether or not the indemnified parties are actual
or potential parties thereto), unless such settlement, compromise or consent (i)
includes an unconditional release of each indemnified party from all liability
arising out of such litigation, investigation, proceeding or claim and (ii) does
not include a statement as to or an admission of fault, culpability or a failure
to act by or on behalf of any indemnified party.
(d) If at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel, such indemnifying party agrees that it shall be liable for any
settlement of the nature contemplated by Section 7(a)(ii) effected without its
written consent if (i) such settlement is entered into more than 45 days after
receipt by such indemnifying party of aforesaid request, (ii) such indemnifying
party shall have received notice of the terms of such settlement at least 30
days prior to such settlement being entered into and (iii) such indemnifying
party shall not have reimbursed such indemnified party in accordance with such
request prior to the date of such settlement.
(e) If the indemnification provided for in this Section 7 is for any reason
unavailable to or insufficient to hold harmless an indemnified party in respect
of any losses, liabilities, claims, damages or expenses referred to therein,
then each indemnifying party shall contribute to the aggregate amount of such
losses, liabilities, claims, damages and expenses incurred by such indemnified
party, as incurred, in such proportion as is appropriate to reflect the relative
fault of the indemnifying party or parties on the one hand and of the
indemnified party on the other hand in connection with the statements or
omissions which resulted in such losses, liabilities, claims, damages or
expenses, as well as any other relevant equitable considerations.
The relative fault of the Company on the one hand and the holders of the
Registrable Securities or the Initial Purchaser on the other hand shall be
determined by reference to, among other things, whether any such untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact relates to information supplied by the Company or by the
holder of the Registrable Securities or the Initial Purchaser and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 7(e) were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to above in this Section 7(e). The
aggregate amount of losses, liabilities, claims, damages, and expenses incurred
by an indemnified party and referred to above in this Section 7(e) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in investigating, preparing or defending against any
litigation, or any investigation or proceeding by any governmental
17
agency or body, commenced or threatened, or any claim whatsoever based upon any
such untrue or alleged untrue statement or omission or alleged omission.
Notwithstanding the provisions of this Section 7, neither the holder of any
Registrable Securities nor the Initial Purchaser, shall be required to indemnify
or contribute any amount in excess of the amount by which the total price at
which the Registrable Securities sold by such holder of Registrable Securities
or underwritten by the Initial Purchaser, as the case may be, and distributed to
the public were offered to the public exceeds the amount of any damages that
such holder of Registrable Securities or the Initial Purchaser 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 Securities Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
For purposes of this Section 7(e), each person, if any, who controls the
Initial Purchaser or any holder of Registrable Securities within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act shall have
the same rights to contribution as the Initial Purchaser or such holder, and
each person, if any, who controls the Company within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act shall have the same
rights to contribution as the Company.
Section 8. Information Requirements. (a) The Company covenants that, if at
any time before the end of the Effectiveness Period the Company is not subject
to the reporting requirements of the Exchange Act, it will cooperate with any
Holder of Registrable Securities and take such further reasonable action as any
Holder of Registrable Securities may reasonably request in writing (including,
without limitation, making such reasonable representations as any such Holder
may reasonably request), all to the extent required from time to time to enable
such Holder to sell Registrable Securities without registration under the
Securities Act within the limitation of the exemptions provided by Rule 144 and
Rule 144A under the Securities Act and customarily taken in connection with
sales pursuant to such exemptions. Upon the written request of any Holder of
Registrable Securities, the Company shall deliver to such Holder a written
statement as to whether it has complied with such filing requirements, unless
such a statement has been included in the Company's most recent report required
to be filed and filed pursuant to Section 13 or Section 15(d) of Exchange Act.
Notwithstanding the foregoing, nothing in this Section 8 shall be deemed to
require the Company to register any of its securities (other than the Common
Stock) under any section of the Exchange Act.
Section 9. Miscellaneous.
(a) No Conflicting Agreements. The Company is not, as of the date hereof, a
party to, nor shall it, on or after the date of this Agreement, enter into, any
agreement with respect to its securities that conflicts with the rights granted
to the Holders of Registrable Securities in this Agreement. The Company
represents and warrants that the rights granted to the Holders of Registrable
Securities hereunder do not in any way conflict with the rights granted to the
holders of the Company's securities under any other agreements.
18
(b) Amendments and Waivers. The provisions of this Agreement, including the
provisions of this sentence, may not be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof may not be given,
unless the Company has obtained the written consent of Holders of a majority of
the then outstanding Underlying Common Stock constituting Registrable Securities
(with Holders of Securities deemed to be the Holders, for purposes of this
Section, of the number of outstanding shares of Underlying Common Stock into
which such Securities are or would be convertible or exchangeable as of the date
on which such consent is requested). Notwithstanding the foregoing, a waiver or
consent to depart from the provisions hereof with respect to a matter that
relates exclusively to the rights of Holders of Registrable Securities whose
securities are being sold pursuant to a Registration Statement and that does not
directly or indirectly affect the rights of other Holders of Registrable
Securities may be given by Holders of at least a majority of the Registrable
Securities being sold by such Holders pursuant to such Registration Statement;
provided, that the provisions of this sentence may not be amended, modified, or
supplemented except in accordance with the provisions of the immediately
preceding sentence. Each Holder of Registrable Securities outstanding at the
time of any such amendment, modification, supplement, waiver or consent or
thereafter shall be bound by any such amendment, modification, supplement,
waiver or consent effected pursuant to this Section 9(b), whether or not any
notice, writing or marking indicating such amendment, modification, supplement,
waiver or consent appears on the Registrable Securities or is delivered to such
Holder.
(c) Notices. All notices and other communications provided for or permitted
hereunder shall be made in writing by hand delivery, by telecopier, by courier
guaranteeing overnight delivery or by first-class mail, return receipt
requested, and shall be deemed given (i) when made, if made by hand delivery,
(ii) upon confirmation, if made by telecopier, (iii) one (1) Business Day after
being deposited with such courier, if made by overnight courier or (iv) on the
date indicated on the notice of receipt, if made by first-class mail, to the
parties as follows:
(w) if to a Holder of Registrable Securities, at the most current address
given by such Holder to the Company in a Notice and Questionnaire or any
amendment thereto;
(x) if to the Company, to:
Stilwell Financial Inc.
920 Main Street 21/st/ Floor
Kansas City, MO 64105-2008
Attention: Gwen E. Royle
Telephone : (816) 218-2400
Facsimile: (816) 218-2453
and
(y) if to the Initial Purchaser, to:
Merrill Lynch & Co.,
Merrill Lynch, Pierce, Fenner & Smith Incorporated
World Financial Center North Tower
250 Vesey Street New York,
New York 10281
Attention: Equity Capital Markets Syndicate
Facsimile: (212) 738-1069
19
or to such other address as such person may have furnished to the other persons
identified in this Section 9(c) in writing in accordance herewith.
(d) Approval of Holders. Whenever the consent or approval of Holders of a
specified percentage of Registrable Securities is required hereunder, the
Registrable Securities held by the Company or its Affiliates (as such term is
defined in Rule 405 under the Securities Act) (other than the Initial Purchaser
or subsequent Holders of Registrable Securities if such subsequent Holders are
deemed to be such Affiliates solely by reason of their holdings of such
Registrable Securities) shall not be counted in determining whether such consent
or approval was given by the Holders of such required percentage.
(e) Successors and Assigns. Any person who purchases any Registrable
Securities from the Initial Purchaser shall be deemed, for purposes of this
Agreement, to be an assignee of the Initial Purchaser. This Agreement shall
inure to the benefit of and be binding upon the successors and assigns of each
of the parties and shall inure to the benefit of and be binding upon each Holder
of any Registrable Securities.
(f) 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 original and all of which taken together
shall constitute one and the same agreement.
(g) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(h) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK, WITHOUT REGARD
TO CONFLICTS OF LAWS PRINCIPLES THEREOF.
(i) Severability. If any term, provision, covenant or restriction of this
Agreement is held to be invalid, illegal, void or unenforceable, the remainder
of the terms, provisions, covenants and restrictions set forth herein shall
remain in full force and effect and shall in no way be affected, impaired or
invalidated thereby, and the parties hereto shall use their best efforts to find
and employ an alternative means to achieve the same or substantially the same
result as that contemplated by such term, provision, covenant or restriction, it
being intended that all of the rights and privileges of the parties shall be
enforceable to the fullest extent permitted by law.
(j) Entire Agreement. This Agreement is intended by the parties as a final
expression of their agreement and is intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein and the registration rights granted by the
Company with respect to the Registrable
20
Securities. Except as provided in the Purchase Agreement, 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 Registrable Securities. This Agreement supersedes
all prior agreements and undertakings among the parties with respect to such
registration rights.
(k) Termination. This Agreement and the obligations of the parties
hereunder shall terminate upon the expiration of the Effectiveness Period,
except for any liabilities or obligations under Sections 4, 5 or 7 hereof and
the obligations to make payments of and provide for liquidated damages under
Section 2(e) hereof to the extent such damages accrue prior to the end of the
Effectiveness Period, each of which shall remain in effect in accordance with
its terms.
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21
IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.
STILWELL FINANCIAL INC.
By:
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Name:
Title:
Confirmed and accepted as of the date first above written:
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
By:
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Name:
Title: