REGISTRATION RIGHTS AGREEMENT
Dated as of November 26, 2004
Among
KRONOS INTERNATIONAL, INC.,
as Issuer,
and
DEUTSCHE BANK AG LONDON,
as Initial Purchaser
8 7/8% Senior Secured Notes due 2009
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TABLE OF CONTENTS
Page
1. Definitions..........................................................1
2. Exchange Offer.......................................................4
3. Shelf Registration...................................................8
4. Additional Interest..................................................9
5. Registration Procedures.............................................11
6. Registration Expenses...............................................19
7. Indemnification and Contribution....................................20
8. Rules 144 and 144A..................................................23
9. Underwritten Registrations..........................................24
10. Miscellaneous.......................................................24
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is dated as of
November 26, 2004, among KRONOS INTERNATIONAL, INC., a corporation organized
under the laws of Delaware (the "Issuer"), and DEUTSCHE BANK AG LONDON, as
initial purchaser (collectively, the "Initial Purchaser").
This Agreement is entered into in connection with the Purchase
Agreement by and among the Issuer and the Initial Purchaser, dated as of
November 18, 2004 (the "Purchase Agreement"), which provides for, among other
things, the sale by the Issuer to the Initial Purchaser of (euro)90,000,000
aggregate principal amount of the Issuer's 8 7/8% Senior Secured Notes due 2009
(the "Securities"). The Securities are part of a series of notes issued
initially on June 28, 2002. In order to induce the Initial Purchaser to enter
into the Purchase Agreement, the Issuer has agreed to provide the registration
rights set forth in this Agreement for the benefit of the Initial Purchaser and
any subsequent holder or holders of the Securities. The execution and delivery
of this Agreement is a condition to the Initial Purchaser's obligation to
purchase the Securities under the Purchase Agreement.
The parties hereby agree as follows:
1. Definitions
As used in this Agreement, the following terms shall have the following
meanings:
Additional Interest: See Section 4(a) hereof.
Advice: See the last paragraph of Section 5 hereof.
Agreement: See the introductory paragraphs hereto.
Applicable Period: See Section 2(b) hereof.
Business Day: Any day that is not a Saturday, Sunday or a day on which
banking institutions in New York or Texas are authorized or required by law to
be closed.
Effectiveness Date: With respect to (i) the Exchange Offer Registration
Statement, the 270th day after the Issue Date and (ii) any Shelf Registration
Statement, the 270th day after the Filing Date with respect thereto; provided,
however, that if the Effectiveness Date would otherwise fall on a day that is
not a Business Day, then the Effectiveness Date shall be the next succeeding
Business Day.
Effectiveness Period: See Section 3(a) hereof.
Event Date: See Section 4 hereof.
Exchange Act: The Securities Exchange Act of 1934, as amended, and the
rules and regulations of the SEC promulgated thereunder.
Exchange Offer: See Section 2(a) hereof.
Exchange Offer Registration Statement: See Section 2(a) hereof.
Exchange Securities: See Section 2(a) hereof.
Filing Date: (A) If no Registration Statement has been filed by the
Issuer pursuant to this Agreement, the 120th day after the Issue Date; and (B)
in any other case (which may be applicable notwithstanding the consummation of
the Exchange Offer), the 120th day after the delivery of a Shelf Notice as
required pursuant to Section 2(c) hereof; provided, however, that if the Filing
Date would otherwise fall on a day that is not a Business Day, then the Filing
Date shall be the next succeeding Business Day.
Holder: Any holder of a Registrable Security or Registrable Securities.
Indenture: The Indenture, dated as of June 28, 2002, by and among the
Issuer and The Bank of New York, as Trustee, pursuant to which the Securities
are being issued, as amended or supplemented from time to time in accordance
with the terms thereof.
Information: See Section 5(o) hereof.
Initial Purchaser: See the introductory paragraphs hereto.
Inspectors: See Section 5(o) hereof.
Issue Date: November 26, 2004.
Issuer: See the introductory paragraphs hereto.
NASD: See Section 5(s) hereof.
Participant: See Section 7(a) hereof.
Participating Broker-Dealer: See Section 2(b) hereof.
Person: An individual, trustee, corporation, partnership, limited
liability company, joint stock company, trust, unincorporated association,
union, business association, firm or other legal entity.
Private Exchange: See Section 2(b) hereof.
Private Exchange Securities: See Section 2(b) hereof.
Prospectus: The prospectus included in any Registration Statement
(including, without limitation, any prospectus subject to completion and a
prospectus that includes any information previously omitted from a prospectus
filed as part of an effective registration statement in reliance upon Rule 430A
under the Securities Act and any term sheet filed pursuant to Rule 434 under the
Securities Act), as amended or supplemented by any prospectus supplement, and
all other amendments and supplements to the Prospectus, including post-effective
amendments, and all material incorporated by reference or deemed to be
incorporated by reference in such Prospectus.
Purchase Agreement: See the introductory paragraphs hereof.
Records: See Section 5(o) hereof.
Registrable Securities: Each Security upon its original issuance and at
all times subsequent thereto, each Exchange Security as to which Section
2(c)(iv) hereof is applicable upon original issuance and at all times subsequent
thereto and each Private Exchange Security upon original issuance thereof and at
all times subsequent thereto, until, in each case, the earliest to occur of (i)
a Registration Statement (other than, with respect to any Exchange Security as
to which Section 2(c)(iv) hereof is applicable, the Exchange Offer Registration
Statement) covering such Security, Exchange Security or Private Exchange
Security has been declared effective by the SEC and such Security, Exchange
Security or such Private Exchange Security, as the case may be, has been
disposed of in accordance with such effective Registration Statement, (ii) such
Security has been exchanged pursuant to the Exchange Offer for an Exchange
Security or Exchange Securities that may be resold without restriction under
state and federal securities laws, (iii) such Security, Exchange Security or
Private Exchange Security, as the case may be, ceases to be outstanding for
purposes of the Indenture or (iv) such Security, Exchange Security or Private
Exchange Security, as the case may be, may be resold without restriction
pursuant to Rule 144(k) (as amended or replaced) under the Securities Act.
Registration Statement: Any registration statement of the Issuer that
covers any of the Securities, the Exchange Securities or the Private Exchange
Securities filed with the SEC under the Securities Act, including the
Prospectus, amendments and supplements to such registration statement, including
post-effective amendments, all exhibits, and all material incorporated by
reference or deemed to be incorporated by reference in such registration
statement.
Rule 144: Rule 144 under the Securities Act.
Rule 144A: Rule 144A under the Securities Act.
Rule 405: Rule 405 under the Securities Act.
Rule 415: Rule 415 under the Securities Act.
Rule 424: Rule 424 under the Securities Act.
SEC: The U.S. Securities and Exchange Commission.
Securities: See the introductory paragraphs hereto.
Securities Act: The Securities Act of 1933, as amended, and the rules
and regulations of the SEC promulgated thereunder.
Shelf Notice: See Section 2(c) hereof.
Shelf Registration: See Section 3(a) hereof.
Shelf Registration Statement: Any Registration Statement relating to a
Shelf Registration.
Suspension Period. See Section 3(a) hereof.
TIA: The Trust Indenture Act of 1939, as amended.
Trustee: The trustee under the Indenture and the trustee (if any) under
any indenture governing the Exchange Securities and Private Exchange Securities.
Underwritten registration or underwritten offering: A registration in
which securities of the Issuer are sold to an underwriter for reoffering to the
public.
Except as otherwise specifically provided, all references in this
Agreement to acts, laws, statutes, rules, regulations, releases, forms,
no-action letters and other regulatory requirements (collectively, "Regulatory
Requirements") shall be deemed to refer also to any amendments thereto and all
subsequent Regulatory Requirements adopted as a replacement thereto having
substantially the same effect therewith; provided that Rule 144 shall not be
deemed to amend or replace Rule 144A.
2. Exchange Offer
(a) Unless the Exchange Offer would violate applicable law or any
applicable interpretation of the staff of the SEC, the Issuer shall file with
the SEC, no later than the Filing Date, a Registration Statement (the "Exchange
Offer Registration Statement") on an appropriate registration form with respect
to a registered offer (the "Exchange Offer") to exchange any and all of the
Registrable Securities (other than the Private Exchange Securities, if any) for
a like aggregate principal amount of debt securities of the Issuer (the
"Exchange Securities") that are substantially identical in all material respects
to the Securities, except that (i) the Exchange Securities shall contain no
restrictive legend thereon, (ii) the Exchange Securities and the Private
Exchange Securities shall not contain provisions for the Additional Interest
contemplated in Section 4 hereof and (iii) interest thereon shall accrue from
(A) the later of (x) the last interest payment date on which interest was paid
on the Securities surrendered in exchange therefor, or (y) if the Securities are
surrendered for exchange on a date in a period which includes the record date
for an interest payment date to occur on or after the date of such exchange and
as to which interest will be paid, the date of such interest payment date, or
(B) if no interest has been paid on such Securities, from the Issue Date. The
Exchange Securities and the Private Exchange Securities shall be entitled to the
benefits of the Indenture or a trust indenture which is identical in all
material respects to the Indenture (other than such changes to the Indenture or
any such identical trust indenture as are necessary to comply with the TIA) and
which, in either case, has been qualified under the TIA, or is exempt from such
qualification. The Indenture or such trust indenture shall provide that (i) the
Exchange Securities shall not be subject to the transfer restrictions set forth
therein but that the Private Exchange Securities shall be subject thereto and
(ii) the Exchange Securities, the Private Exchange Securities and the Securities
shall vote and consent together on all matters as one class and that none of the
Exchange Securities, the Private Exchange Securities or the Securities shall
have the right to vote or consent as a separate class on any matter. The
Exchange Offer shall comply in all material respects with all applicable tender
offer rules and regulations under the Exchange Act and other applicable laws.
The Issuer shall use its best efforts to (x) cause the Exchange Offer
Registration Statement to be declared effective under the Securities Act on or
before the Effectiveness Date; (y) keep the Exchange Offer open for at least 30
days (or longer if required by applicable law) after the date that notice of the
Exchange Offer is mailed to Holders; and (z) consummate the Exchange Offer on or
prior to the 300th day following the Issue Date.
Each Holder (including, without limitation, each Participating
Broker-Dealer) who participates in the Exchange Offer will be required, as a
condition to its participation in the Exchange Offer, to represent to the Issuer
in writing (which may be contained in the applicable letter of transmittal)
that: (i) any Exchange Securities acquired in exchange for Registrable
Securities tendered are being acquired in the ordinary course of business of the
Person receiving such Exchange Securities, whether or not such recipient is such
Holder itself; (ii) at the time of the commencement of the Exchange Offer such
Holder does not have an arrangement or understanding with any Person to
participate in the distribution (within the meaning of the Securities Act) of
the Exchange Securities in violation of the provisions of the Securities Act;
(iii) such Holder is not an "affiliate" (as defined in Rule 405) of the Issuer
or, if it is an affiliate of the Issuer, it will comply with the registration
and prospectus delivery requirements of the Securities Act to the extent
applicable and will provide information to be included in the Shelf Registration
Statement in accordance with Section 5 hereof in order to have its Securities
included in the Shelf Registration Statement and benefit from the provisions
regarding Additional Interest in Section 4 hereof; (iv) if such Holder is not a
broker-dealer, such Holder is not engaging in and does not intend to engage in a
distribution of the Exchange Securities; and (v) if such Holder is a
Participating Broker-Dealer, such Holder has acquired the Registrable Securities
as a result of market-making activities or other trading activities and that it
will comply with the applicable provisions of the Securities Act (including, but
not limited to, the prospectus delivery requirements thereunder); and (vi) such
Holder is not acting on behalf of a Person who could not make the foregoing
representations.
Upon consummation of the Exchange Offer in accordance with this Section
2, the provisions of this Agreement shall continue to apply, mutatis mutandis,
solely with respect to Registrable Securities that are Private Exchange
Securities, Exchange Securities as to which Section 2(c)(iv) is applicable and
Exchange Securities held by Participating Broker-Dealers, and the Issuer shall
have no further obligation to register Registrable Securities (other than
Private Exchange Securities and Exchange Securities as to which clause 2(c)(iv)
hereof applies) pursuant to Section 3 hereof.
No securities other than the Exchange Securities shall be included in
the Exchange Offer Registration Statement.
(b) The Issuer shall include within the Prospectus contained in the
Exchange Offer Registration Statement a section entitled "Plan of Distribution,"
reasonably acceptable to the Initial Purchaser, which shall contain a summary
statement of the positions taken or policies made by the staff of the SEC with
respect to the potential "underwriter" status of any broker-dealer that is the
"beneficial owner" (as defined in Rule 13d-3 under the Exchange Act) of Exchange
Securities received by such broker-dealer in the Exchange Offer (a
"Participating Broker-Dealer"), whether such positions or policies have been
publicly disseminated by the staff of the SEC or such positions or policies
represent the prevailing views of the staff of the SEC. Such "Plan of
Distribution" section shall also expressly permit, to the extent permitted by
applicable policies and regulations of the SEC, the use of the Prospectus by all
Persons subject to the prospectus delivery requirements of the Securities Act,
including, to the extent permitted by applicable policies and regulations of the
SEC, all Participating Broker-Dealers, and include a statement describing the
means by which Participating Broker-Dealers may resell the Exchange Securities
in compliance with the Securities Act.
The Issuer shall use its best efforts to keep the Exchange Offer
Registration Statement effective and to amend and supplement the Prospectus
contained therein in order to permit such Prospectus to be lawfully delivered by
all Persons subject to the prospectus delivery requirements of the Securities
Act for such period of time as is necessary to comply with applicable law in
connection with any resale of the Exchange Securities; provided, however, that
such period shall not be required to exceed 90 days or such longer period if
extended pursuant to the last paragraph of Section 5 hereof (the "Applicable
Period").
If, prior to consummation of the Exchange Offer, the Initial Purchaser
holds any Securities acquired by it that have the status of an unsold allotment
in the initial distribution, the Issuer upon the request of the Initial
Purchaser shall simultaneously with the delivery of the Exchange Securities
issue and deliver to the Initial Purchaser, in exchange (the "Private Exchange")
for such Securities held by any such Holder, a like principal amount of
securities (the "Private Exchange Securities") of the Issuer that are identical
in all material respects to the Exchange Securities, except for the placement of
a restrictive legend on such Private Exchange Securities. The Private Exchange
Securities shall be issued pursuant to the same indenture as the Exchange
Securities and the Issuer shall use its best efforts to have the Private
Exchange Securities bear the same CUSIP number as the Exchange Securities. The
Issuer shall not have any liability under this Agreement solely as a result of
the Private Exchange Securities not bearing the same CUSIP number as the
Exchange Securities.
In connection with the Exchange Offer, the Issuer shall:
(1) mail, or cause to be mailed, to each Holder of record
entitled to participate in the Exchange Offer a copy of the Prospectus
forming part of the Exchange Offer Registration Statement, together
with an appropriate letter of transmittal and related documents;
(2) use their best efforts to keep the Exchange Offer open for
not less than 30 calendar days after the date that notice of the
Exchange Offer is mailed to Holders (or longer if required by
applicable law);
(3) utilize the services of a depositary for the Exchange
Offer with an address in the Borough of Manhattan, The City of New
York;
(4) permit Holders to withdraw tendered Registrable Securities
at any time prior to 5:00 p.m., New York time, on the last Business Day
on which the Exchange Offer remains open by sending to the institution
specified in the notice, a telegram, facsimile transmission or letter
setting forth the name of such Holder, the principal amount of
Registrable Securities delivered for exchange and a statement that the
Holder is withdrawing such Holder's election to have such Registrable
Securities or portion thereof exchanged; and
(5) otherwise comply in all material respects with all
applicable laws, rules and regulations relating to the Exchange Offer.
As soon as practicable after the close of the Exchange Offer and the
Private Exchange, if any, the Issuer shall:
(1) accept for exchange all Registrable Securities validly
tendered and not validly withdrawn pursuant to the Exchange Offer and
the Private Exchange, if any in accordance with the terms of the
Exchange Offer Registration Statement and the related letter of
transmittal;
(2) deliver to the Trustee for cancellation all Registrable
Securities so accepted for exchange; and
(3) cause the Trustee to authenticate and deliver promptly to
each Holder of Securities, Exchange Securities or Private Exchange
Securities, as the case may be, equal in principal amount to the
Registrable Securities of such Holder so accepted for exchange;
provided that, in the case of any Registrable Securities held in global
form by a depositary, authentication and delivery to such depositary of
one or more replacement Securities in global form in an equivalent
principal amount thereto for the account of such Holders in accordance
with the Indenture shall satisfy such authentication and delivery
requirement.
The Exchange Offer and the Private Exchange shall not be subject to any
conditions, other than that (i) the Exchange Offer or Private Exchange, as the
case may be or the making of any exchange by a Holder, does not violate
applicable law or any applicable interpretation of the staff of the SEC; (ii)
the valid tendering of Registrable Securities in accordance with the Exchange
Offer and the Private Exchange; (iii) no action or proceeding shall have been
instituted or threatened in any court or by any governmental agency which, in
the Issuer's reasonable judgment, might materially impair the ability of the
Issuer to proceed with the Exchange Offer or the Private Exchange, and no
material adverse development shall have occurred in any existing action or
proceeding with respect to the Issuer; and (iv) all governmental approvals shall
have been obtained, which approvals the Issuer deems necessary for the
consummation of the Exchange Offer or Private Exchange.
(c) If, (i) because of any change in law or in currently prevailing
interpretations of the staff of the SEC, the Issuer is not permitted to effect
the Exchange Offer, (ii) the Exchange Offer is not consummated within 300 days
of the Issue Date, (iii) the Initial Purchaser or any Holder of Private Exchange
Securities so requests in writing to the Issuer at any time within 90 days after
the consummation of the Exchange Offer or (iv) in the case of any Holder that
participates in the Exchange Offer, such Holder does not receive Exchange
Securities on the date of the exchange that may be sold without restriction
under state and federal securities laws (other than due solely to the status of
such Holder as an affiliate of the Issuer within the meaning of the Securities
Act) and so notifies the Issuer within 30 days after such Holder first becomes
aware of such restrictions, in the case of each of clauses (i) to and including
(iv) of this sentence, then the Issuer shall promptly deliver to the Holders and
the Trustee written notice thereof (the "Shelf Notice") and shall file a Shelf
Registration pursuant to Section 3 hereof.
3. Shelf Registration
If at any time a Shelf Notice is delivered as contemplated by Section
2(c) hereof, then:
(a) Shelf Registration. The Issuer shall use its best efforts
to file with the SEC a Registration Statement for an offering to be
made on a continuous basis pursuant to Rule 415 covering all of the
Registrable Securities (the "Shelf Registration") on or prior to the
applicable Filing Date. The Shelf Registration shall be on Form S-1 or
another appropriate form permitting registration of such Registrable
Securities for resale by Holders participating in the Shelf
Registration in the manner or manners designated by them (including,
without limitation, one or more underwritten offerings). The Issuer
shall not permit any securities other than the Registrable Securities
to be included in the Shelf Registration.
The Issuer shall use its best efforts to cause the Shelf
Registration to be declared effective under the Securities Act on or
prior to the Effectiveness Date and to keep the Shelf Registration
continuously effective under the Securities Act until the date that is
two years from the Issue Date or such shorter period ending when all
Registrable Securities covered by the Shelf Registration have been sold
in the manner set forth and as contemplated in the Shelf Registration
or cease to be outstanding or otherwise to be Registrable Securities
(the "Effectiveness Period"); provided, however, that the Effectiveness
Period in respect of the Shelf Registration shall be extended to the
extent required to permit dealers to comply with the applicable
prospectus delivery requirements of Rule 174 under the Securities Act
and as otherwise provided herein and shall be subject to reduction to
the extent that the applicable provisions of Rule 144(k) are amended or
revised to reduce the two year holding period set forth therein;
provided, further, that the foregoing shall not apply to actions taken
by the Issuer in good faith and for valid business reasons (not
including avoidance of their obligations hereunder), including, without
limitation, the acquisition or divestiture of assets, so long as the
Issuer within 90 days thereafter complies with the requirements of
Section 5(u) hereof. Any such period during which the Issuer fails to
keep the Shelf Registration Statement effective and usable for offers
and sales of the Registrable Securities or Exchange Securities is
referred to as a "Suspension Period." A Suspension Period shall
commence on and include the date that the Issuer gives notice that the
Shelf Registration Statement is no longer effective or the prospectus
included therein is no longer usable for offers and sales of
Registrable Securities and Exchange Securities and shall end on the
date when each Holder of Registrable Securities and Exchange Securities
covered by such registration statement either receives the copies of
the supplemented or amended prospectus contemplated by Section 5(u)
hereof or is advised in writing by the Issuer that use of the
prospectus may be resumed. If one or more Suspension Periods occur, the
two-year period referenced above shall be extended by the aggregate of
the number of days included in each Suspension Period.
(b) Withdrawal of Stop Orders. If the Shelf Registration
ceases to be effective for any reason at any time during the
Effectiveness Period (other than because of the sale of all of the
Securities registered thereunder or pursuant to the second proviso of
the first sentence of the second paragraph of Section 3(a)), the Issuer
shall use its best efforts to obtain the prompt withdrawal of any order
suspending the effectiveness thereof, and in any event shall within 30
days of such cessation of effectiveness amend such Shelf Registration
Statement in a manner to obtain the withdrawal of the order suspending
the effectiveness thereof.
(c) Supplements and Amendments. The Issuer shall promptly
supplement and amend the Shelf Registration if required by the rules,
regulations or instructions applicable to the registration form used
for such Shelf Registration, if required by the Securities Act, or if
reasonably requested by the Holders of a majority in aggregate
principal amount of the Registrable Securities (or their counsel)
covered by such Registration Statement with respect to the information
included therein with respect to one or more of such Holders, or by any
underwriter of such Registrable Securities with respect to the
information included therein with respect to such underwriter.
4. Additional Interest
(a) The Issuer and the Initial Purchaser agree that the Holders will
suffer damages if the Issuer fails to fulfill its obligations under Section 2 or
Section 3 hereof and that it would not be feasible to ascertain the extent of
such damages with precision. Accordingly, the Issuer agrees to pay as liquidated
damages, additional interest on the Registrable Securities ("Additional
Interest") under the circumstances and to the extent set forth below (each of
which shall be given independent effect):
(i) if (A) neither the Exchange Offer Registration Statement
nor the Initial Shelf Registration has been filed on or prior to the
Filing Date applicable thereto or (B) notwithstanding that the Issuer
has consummated or will consummate the Exchange Offer, the Issuer is
required to file a Shelf Registration and such Shelf Registration is
not filed on or prior to the Filing Date applicable thereto, then,
commencing on the day after any such Filing Date, Additional Interest
shall accrue on the principal amount of the Registrable Securities at a
rate of 0.25% per annum for the first 90 days immediately following
such applicable Filing Date, and such Additional Interest rate shall
increase by an additional 0.25% per annum at the beginning of each
subsequent 90-day period; or
(ii) if (A) neither the Exchange Offer Registration Statement
nor the Initial Shelf Registration is declared effective by the SEC on
or prior to the Effectiveness Date applicable thereto or (B)
notwithstanding that the Issuer has consummated or will consummate the
Exchange Offer, the Issuer is required to file a Shelf Registration and
such Shelf Registration is not declared effective by the SEC on or
prior to the Effectiveness Date applicable to such Shelf Registration,
then, commencing on the day after such Effectiveness Date, Additional
Interest shall accrue on the principal amount of the Securities at a
rate of 0.25% per annum for the first 90 days immediately following the
day after such Effectiveness Date, and such Additional Interest rate
shall increase by an additional 0.25% per annum at the beginning of
each subsequent 90-day period; or
(iii) if (A) the Issuer has not exchanged Exchange Securities
for all Securities validly tendered in accordance with the terms of the
Exchange Offer on or prior to the 300th day after the Issue Date or (B)
if applicable, a Shelf Registration has been declared effective and
such Shelf Registration ceases to be effective at any time during the
Effectiveness Period (other than because of the sale of all of the
Securities registered thereunder), then Additional Interest shall
accrue on the principal amount of the Registrable Securities at a rate
of 0.25% per annum for the first 90 days commencing on the (x) 300th
day after the Issue Date, in the case of (A) above, or (y) the day such
Shelf Registration ceases to be effective (other than because of the
sale of all of the Securities registered thereunder), in the case of
(B) above, and such Additional Interest rate shall increase by an
additional 0.25% per annum at the beginning of each such subsequent
90-day period;
provided, however, that the Additional Interest rate on the Securities may not
accrue under more than one of the foregoing clauses (i) - (iii) at any one time
and at no time shall the aggregate amount of additional interest accruing exceed
in the aggregate 0.75% per annum; provided, further, however, that (1) upon the
filing of the Exchange Offer Registration Statement or the Shelf Registration as
required hereunder (in the case of clause (i) above of this Section 4), (2) upon
the effectiveness of the Exchange Offer Registration Statement or the Shelf
Registration Statement as required hereunder (in the case of clause (ii) of this
Section 4) or (3) upon the exchange of the Exchange Securities for all
Securities tendered (in the case of clause (iii)(A) of this Section 4), or upon
the effectiveness of the applicable Shelf Registration Statement which had
ceased to remain effective (in the case of (iii)(B) of this Section 4),
Additional Interest on the Securities in respect of which such events relate as
a result of such clause (or the relevant subclause thereof), as the case may be,
shall cease to accrue.
(b) The Issuer shall notify the Trustee within one Business Day after
each and every date on which an event occurs in respect of which Additional
Interest is required to be paid (an "Event Date"). Any amounts of Additional
Interest due pursuant to (a)(i), (a)(ii) or (a)(iii) of this Section 4 will be
payable in cash semiannually on each June 30 and December 30 (to the holders of
record on June 15 and December 30 immediately preceding such dates), commencing
with the first such date occurring after any such Additional Interest commences
to accrue. The amount of Additional Interest will be determined by multiplying
the applicable Additional Interest rate by the principal amount of the
Registrable Securities, multiplied by a fraction, the numerator of which is the
number of days such Additional Interest rate was applicable during such period
(determined on the basis of a 360 day year comprised of twelve 30 day months
and, in the case of a partial month, the actual number of days elapsed), and the
denominator of which is 360.
5. Registration Procedures
In connection with the filing of any Registration Statement pursuant to
Section 2 or 3 hereof, the Issuer shall effect such registrations to permit the
sale of the securities covered thereby in accordance with the intended method or
methods of disposition thereof, and pursuant thereto and in connection with any
Registration Statement filed by the Issuer hereunder the Issuer shall:
(a) Prepare and file with the SEC prior to the applicable
Filing Date a Registration Statement or Registration Statements as
prescribed by Section 2 or 3 hereof, and use its best efforts to cause
each such Registration Statement to become effective and remain
effective as provided herein; provided, however, that if (1) such
filing is pursuant to Section 3 hereof or (2) a Prospectus contained in
the Exchange Offer Registration Statement filed pursuant to Section 2
hereof is required to be delivered under the Securities Act by any
Participating Broker-Dealer who seeks to sell Exchange Securities
during the Applicable Period relating thereto from whom the Issuer has
received written notice that it will be a Participating Broker-Dealer
in the Exchange Offer, before filing any Registration Statement or
Prospectus or any amendments or supplements thereto, the Issuer shall
furnish to and afford the Holders of the Registrable Securities covered
by such Registration Statement (with respect to a Registration
Statement filed pursuant to Section 3 hereof) or each such
Participating Broker-Dealer (with respect to any such Registration
Statement), as the case may be, their counsel and the managing
underwriters, if any, a reasonable opportunity to review copies of all
such documents (including copies of any documents to be incorporated by
reference therein and all exhibits thereto) proposed to be filed (in
each case at least five business days prior to such filing). The Issuer
shall not file any Registration Statement or Prospectus or any
amendments or supplements thereto if the Holders of a majority in
aggregate principal amount of the Registrable Securities covered by
such Registration Statement, their counsel, or the managing
underwriters, if any, shall reasonably object on a timely basis.
(b) Prepare and file with the SEC such amendments and
post-effective amendments to each Shelf Registration Statement or
Exchange Offer Registration Statement, as the case may be, as may be
necessary to keep such Registration Statement continuously effective
for the Effectiveness Period, the Applicable Period or until
consummation of the Exchange Offer, as the case may be; cause the
related Prospectus to be supplemented by any Prospectus supplement
required by applicable law, and as so supplemented to be filed pursuant
to Rule 424; and comply in all material respects with the provisions of
the Securities Act and the Exchange Act applicable to it with respect
to the disposition of all securities covered by such Registration
Statement as so amended or in such Prospectus as so supplemented and
with respect to the subsequent resale of any securities being sold by a
Participating Broker-Dealer covered by any such Prospectus. The Issuer
shall be deemed not to have used its best efforts to keep a
Registration Statement effective if the Issuer voluntarily takes any
action that would result in selling Holders of the Registrable
Securities covered thereby or Participating Broker-Dealers seeking to
sell Exchange Securities not being able to sell such Registrable
Securities or such Exchange Securities during that period unless such
action is required by applicable law, pursuant to the second proviso of
the first sentence of the second paragraph of Section 3(a) or permitted
by this Agreement.
(c) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in the Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required
to be delivered under the Securities Act by any Participating
Broker-Dealer who seeks to sell Exchange Securities during the
Applicable Period relating thereto from whom the Issuer has received
written notice that it will be a Participating Broker-Dealer in the
Exchange Offer, notify the selling Holders of Registrable Securities
(with respect to a Registration Statement filed pursuant to Section 3
hereof), or each such Participating Broker-Dealer (with respect to any
such Registration Statement), as the case may be, their counsel and the
managing underwriters, if any, promptly (but in any event within two
Business Days), and confirm such notice in writing, (i) when a
Prospectus or any Prospectus supplement or post-effective amendment has
been filed, and, with respect to a Registration Statement or any
post-effective amendment, when the same has become effective under the
Securities Act and, upon request, at the sole expense of the Issuer,
provide one conformed copy of such Registration Statement or
post-effective amendment including financial statements and schedules,
documents incorporated or deemed to be incorporated by reference and
exhibits), (ii) of the issuance by the SEC of any stop order suspending
the effectiveness of a Registration Statement or of any order
preventing or suspending the use of any preliminary Prospectus or the
initiation of any proceedings for that purpose, (iii) if at any time
when a Prospectus is required by the Securities Act to be delivered in
connection with sales of the Registrable Securities or resales of
Exchange Securities by Participating Broker-Dealers the representations
and warranties of the Issuer contained in any agreement (including any
underwriting agreement) contemplated by Section 5(n) hereof cease to be
true and correct in any material respect, (iv) of the receipt by the
Issuer of any notification with respect to the suspension of the
qualification or exemption from qualification of a Registration
Statement or any of the Registrable Securities or the Exchange
Securities to be sold by any Participating Broker-Dealer for offer or
sale in any jurisdiction, or the initiation or written threat of any
proceeding for such purpose, (v) of the happening of any event, the
existence of any condition or any information becoming known that makes
any statement made in such Registration Statement or related Prospectus
or any document incorporated or deemed to be incorporated therein by
reference untrue in any material respect or that requires the making of
any changes in or amendments or supplements to such Registration
Statement, Prospectus or documents so that, in the case of the
Registration Statement, it will 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
that in the case of the Prospectus, it will 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, and (vi) of the Issuer's determination that a
post-effective amendment to a Registration Statement would be
appropriate.
(d) Use its best efforts to prevent the issuance of any order
suspending the effectiveness of a Registration Statement or of any
order preventing or suspending the use of a Prospectus or suspending
the qualification (or exemption from qualification) of any of the
Registrable Securities or the Exchange Securities to be sold by any
Participating Broker-Dealer, for sale in any jurisdiction, and, if any
such order is issued, to use its best efforts to obtain the withdrawal
of any such order at the earliest practicable moment.
(e) If a Shelf Registration is filed pursuant to Section 3 and
if requested during the Effectiveness Period by the managing
underwriter or underwriters (if any), the Holders of a majority in
aggregate principal amount of the Registrable Securities being sold in
connection with an underwritten offering or any Participating
Broker-Dealer, (i) as promptly as practicable incorporate in a
Prospectus supplement or post-effective amendment such information as
the managing underwriter or underwriters (if any), such Holders, any
Participating Broker-Dealer or counsel for any of them determine is
reasonably necessary to be included therein concerning themselves, (ii)
make all required filings of such Prospectus supplement or such
post-effective amendment as soon as practicable after the Issuer has
received notification of the matters to be incorporated in such
Prospectus supplement or post-effective amendment, and (iii) if
required, supplement or make amendments to such Registration Statement.
(f) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in the Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required
to be delivered under the Securities Act by any Participating
Broker-Dealer who seeks to sell Exchange Securities during the
Applicable Period, furnish to each selling Holder of Registrable
Securities (with respect to a Registration Statement filed pursuant to
Section 3 hereof) and to each such Participating Broker-Dealer who so
requests (with respect to any such Registration Statement) and to their
respective counsel and each managing underwriter, if any, at the sole
expense of the Issuer, one conformed copy of the Registration Statement
or Registration Statements and each post-effective amendment thereto,
including financial statements and schedules, and, if requested, all
documents incorporated or deemed to be incorporated therein by
reference and all exhibits.
(g) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in the Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required
to be delivered under the Securities Act by any Participating
Broker-Dealer who seeks to sell Exchange Securities during the
Applicable Period, deliver to each selling Holder of Registrable
Securities (with respect to a Registration Statement filed pursuant to
Section 3 hereof), or each such Participating Broker-Dealer (with
respect to any such Registration Statement), as the case may be, their
respective counsel, and the underwriters, if any, at the sole expense
of the Issuer, as many copies of the Prospectus or Prospectuses
(including each form of preliminary Prospectus) and each amendment or
supplement thereto and any documents incorporated by reference therein
as such Persons may reasonably request; and, subject to the last
paragraph of this Section 5, the Issuer hereby consents to the use of
such Prospectus and each amendment or supplement thereto by each of the
selling Holders of Registrable Securities or each such Participating
Broker-Dealer, as the case may be, and the underwriters or agents, if
any, and dealers, if any, in connection with the offering and sale of
the Registrable Securities covered by, or the sale by Participating
Broker-Dealers of the Exchange Securities pursuant to, such Prospectus
and any amendment or supplement thereto.
(h) Prior to any public offering of Registrable Securities or
any delivery of a Prospectus contained in the Exchange Offer
Registration Statement by any Participating Broker-Dealer who seeks to
sell Exchange Securities during the Applicable Period, use its best
efforts to register or qualify, and to cooperate with the selling
Holders of Registrable Securities or each such Participating
Broker-Dealer, as the case may be, the managing underwriter or
underwriters, if any, and their respective counsel 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 selling Holder, Participating Broker-Dealer, or
the managing underwriter or underwriters reasonably request in writing;
provided, however, that where Exchange Securities held by Participating
Broker-Dealers or Registrable Securities are offered other than through
an underwritten offering, the Issuer agrees to cause its counsel to
perform Blue Sky investigations and file registrations and
qualifications required to be filed pursuant to this Section 5(h), keep
each such registration or qualification (or exemption therefrom)
effective during the period such Registration Statement is required to
be kept effective and do any and all other acts or things necessary or
advisable to enable the disposition in such jurisdictions of the
Exchange Securities held by Participating Broker-Dealers or the
Registrable Securities covered by the applicable Registration
Statement; provided, however, that the Issuer shall not be required to
(A) qualify generally to do business in any jurisdiction where it is
not then so qualified, (B) take any action that would subject it to
general service of process in any such jurisdiction where it is not
then so subject or (C) subject itself to taxation in any such
jurisdiction where it is not then so subject.
(i) If a Shelf Registration is filed pursuant to Section 3
hereof, cooperate with the selling Holders of Registrable Securities
and the managing underwriter or underwriters, if any, to facilitate the
timely preparation and delivery of certificates representing
Registrable Securities to be sold, which certificates shall not bear
any restrictive legends and shall be in a form eligible for deposit
with The Depository Trust Company; and enable such Registrable
Securities to be in such denominations (subject to applicable
requirements contained in the Indenture) and registered in such names
as the managing underwriter or underwriters, if any, or Holders may
request at least two Business Days prior to such sale.
(j) Use its best efforts to cause the Registrable 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 or
underwriters, if any, to consummate the disposition of such Registrable
Securities, provided, however, that the Issuer shall not be required to
(A) qualify generally to do business, in any jurisdiction where it is
not then so qualified, (B) take any action that would subject it to
general service of process in any such jurisdiction where it is not
then so subject or (C) subject itself to taxation in any such
jurisdiction where it is not then so subject.
(k) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in the Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required
to be delivered under the Securities Act by any Participating
Broker-Dealer who seeks to sell Exchange Securities during the
Applicable Period, upon the occurrence of any event contemplated by
paragraph 5(c)(v) or 5(c)(vi) hereof, as promptly as practicable
prepare and (subject to Section 5(a) hereof) file with the SEC, at the
sole expense of the Issuer, a supplement or post-effective amendment to
the Registration Statement or a supplement to the related Prospectus or
any document incorporated or deemed to be incorporated therein by
reference, or file any other required document so that, as thereafter
delivered to the purchasers of the Registrable Securities being sold
thereunder (with respect to a Registration Statement filed pursuant to
Section 3 hereof) or to the purchasers of the Exchange Securities to
whom such Prospectus will be delivered by a Participating Broker-Dealer
(with respect to any such Registration Statement), any such Prospectus
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, in the light of the circumstances under
which they were made, not misleading.
(l) Use its best efforts to cause the Registrable Securities
covered by a Registration Statement or the Exchange Securities, as the
case may be, to be rated with the appropriate rating agencies, if so
requested by the Holders of a majority in aggregate principal amount of
Registrable Securities covered by such Registration Statement or the
Exchange Securities, as the case may be, or the managing underwriter or
underwriters, if any.
(m) Prior to the effective date of the first Registration
Statement relating to the Registrable Securities, (i) provide the
Trustee with certificates for the Registrable Securities in a form
eligible for deposit with The Depository Trust Company and (ii) provide
a CUSIP number for the Registrable Securities.
(n) In connection with any underwritten offering of
Registrable Securities pursuant to a Shelf Registration, enter into an
underwriting agreement as is customary in underwritten offerings of
debt securities similar to the Securities, and take all such other
actions as are reasonably requested by the managing underwriter or
underwriters in order to expedite or facilitate the registration or the
disposition of such Registrable Securities and, in such connection, (i)
make such representations and warranties to, and covenants with, the
underwriters with respect to the business of the Issuer (including any
acquired business, properties or entity, if applicable), and the
Registration Statement, Prospectus and documents, if any, incorporated
or deemed to be incorporated by reference therein, in each case, as are
customarily made by issuers to underwriters in underwritten offerings
of debt securities similar to the Securities, and confirm the same in
writing if and when requested; (ii) obtain the written opinions of
counsel to the Issuer, and written updates thereof in customary form,
scope and substance reasonably satisfactory to the managing underwriter
or underwriters addressed to the underwriters covering the matters
customarily covered in opinions reasonably requested in underwritten
offerings of debt securities similar to the Securities; (iii) obtain
"cold comfort" letters and updates thereof in customary form, scope and
substance reasonably satisfactory to the managing underwriter or
underwriters from the independent certified public accountants of the
Issuer (and, if necessary, any other independent certified public
accountants of the Issuer, or of any business acquired by the Issuer,
for which financial statements and financial data are, or are required
to be, included or incorporated by reference in the Registration
Statement), addressed to each of the underwriters, such letters to be
in customary form and covering matters of the type customarily covered
in "cold comfort" letters in connection with underwritten offerings of
debt securities similar to the Securities; and (iv) if an underwriting
agreement is entered into, the same shall contain indemnification
provisions and procedures no less favorable to the parties, if any,
than those set forth in Section 7 hereof (or such other provisions and
procedures reasonably acceptable to Holders of a majority in aggregate
principal amount of Registrable Securities covered by such Registration
Statement and the managing underwriter or underwriters or agents, if
any). The above shall be done at each closing under such underwriting
agreement, or as and to the extent required thereunder.
(o) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in the Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required
to be delivered under the Securities Act by any Participating
Broker-Dealer who seeks to sell Exchange Securities during the
Applicable Period, make available for inspection by the Initial
Purchaser, any selling Holder of such Registrable Securities being sold
(with respect to a Registration Statement filed pursuant to Section 3
hereof), or each such Participating Broker-Dealer, as the case may be,
any underwriter participating in any such disposition of Registrable
Securities, if any, and any attorney, accountant or other agent
retained by any such selling Holder or each such Participating
Broker-Dealer (with respect to any such Registration Statement), as the
case may be, or underwriter (the Initial Purchaser, Holders,
Participating Broker-Dealers, underwriters, attorneys, accountants or
agents, collectively, the "Inspectors"), upon written request, at the
offices where normally kept, during reasonable business hours, all
pertinent financial and other records, pertinent corporate documents
and instruments of the Issuer and subsidiaries of the Issuer
(collectively, the "Records"), as shall be reasonably necessary to
enable them to exercise any applicable due diligence responsibilities,
and cause the officers, directors and employees of the Issuer and any
of its subsidiaries to supply all information ("Information")
reasonably requested by any such Inspector in connection with such due
diligence responsibilities. Each Inspector shall agree in writing that
it will keep the Records and Information confidential and that it will
not disclose any of the Records or Information that the Issuer
determines, in good faith, to be confidential and notifies the
Inspectors are confidential unless (i) the Issuer based upon advice of
counsel determines that the disclosure of such Records or Information
is necessary to avoid or correct a material misstatement or material
omission in such Registration Statement or Prospectus, (ii) the release
of such Records or Information is ordered pursuant to a subpoena or
other order from a court of competent jurisdiction, (iii) disclosure of
such Records or Information is ordered by any court or regulatory
agency in connection with any action, claim, suit or proceeding,
directly or indirectly, involving or potentially involving such
Inspector and arising out of, based upon, relating to, or involving
this Agreement or the Purchase Agreement, or any transactions
contemplated hereby or thereby or arising hereunder or thereunder, or
(iv) the information in such Records or Information has been made
generally available to the public other than by an Inspector or an
"affiliate" (as defined in Rule 405) thereof; provided, however, that
prior notice shall be provided as soon as practicable to the Issuer of
the potential disclosure of any information by such Inspector pursuant
to clauses (i) or (ii) of this sentence to permit the Issuer to obtain
a protective order (or waive the provisions of this paragraph (o)) and
that such Inspector shall take such actions as are reasonably necessary
to protect the confidentiality of such information (if practicable) to
the extent such action is otherwise not inconsistent with, an
impairment of or in derogation of the rights and interests of the
Holder or any Inspector. The Inspectors will agree that all information
obtained by it as a result of such inspection is confidential and shall
be used as the basis for any market transactions in the securities of
the Issuer or its affiliates unless and until such information is made
generally available to the public.
(p) Provide an indenture trustee for the Registrable
Securities or the Exchange Securities, as the case may be, and cause
the Indenture or the trust indenture provided for in Section 2(a)
hereof, as the case may be, to be qualified under the TIA not later
than the effective date of the first Registration Statement relating to
the Registrable Securities; and in connection therewith, cooperate with
the trustee under any such indenture and the Holders of the Registrable
Securities, to effect such changes (if any) to such indenture as may be
required for such indenture to be so qualified in accordance with the
terms of the TIA; and execute, and use its best efforts to cause such
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 such indenture to be so qualified in a timely manner.
(q) Comply with all applicable rules and regulations of the
SEC and make generally available to its securityholders with regard to
any applicable Registration Statement, a consolidated earnings
statement 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 fiscal
quarter (or 90 days after the end of any 12-month period if such period
is a fiscal year) (i) commencing at the end of any fiscal quarter in
which Registrable Securities are sold to underwriters in a firm
commitment or best efforts underwritten offering and (ii) if not sold
to underwriters in such an offering, commencing on the first day of the
first fiscal quarter of the Issuer, after the effective date of a
Registration Statement, which statements shall cover said 12-month
periods.
(r) Upon consummation of the Exchange Offer or a Private
Exchange, obtain an opinion of counsel to the Issuer, in a form
customary for underwritten transactions, addressed to the Trustee for
the benefit of all Holders of Registrable Securities participating in
the Exchange Offer or the Private Exchange, as the case may be, that
the Exchange Securities or Private Exchange Securities, as the case may
be, and the related indenture constitute legal, valid and binding
obligations of the Issuer, enforceable against the Issuer in accordance
with their respective terms, subject to customary exceptions and
qualifications. If the Exchange Offer or a Private Exchange is to be
consummated, upon delivery of the Registrable Securities by Holders to
the Issuer (or to such other Person as directed by the Issuer), in
exchange for the Exchange Securities or the Private Exchange
Securities, as the case may be, the Issuer shall mark, or cause to be
marked, on such Registrable Securities that such Registrable Securities
are being canceled in exchange for the Exchange Securities or the
Private Exchange Securities, as the case may be; in no event shall such
Registrable Securities be marked as paid or otherwise satisfied.
(s) Cooperate with each seller of Registrable Securities
covered by any Registration Statement and each underwriter, if any,
participating in the disposition of such Registrable Securities and
their respective counsel in connection with any filings required to be
made with the National Association of Securities Dealers, Inc. (the
"NASD").
(t) Use its best efforts to take all other steps necessary to
effect the registration of the Exchange Securities and/or Registrable
Securities covered by a Registration Statement contemplated hereby.
(u) If any Suspension Period remains in effect more than 90
days after the occurrence thereof, the Issuer will promptly prepare and
file with the Commission a post-effective amendment to the Registration
Statement or a supplement to the related prospectus or file any other
required document so that, as thereafter delivered to purchasers of the
Exchange Securities or Private Exchange Securities from a Holder, the
prospectus will not include an untrue statement of a material fact or
omit 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.
The Issuer may require each seller of Registrable Securities as to
which any registration is being effected to furnish to the Issuer such
information regarding such seller and the distribution of such Registrable
Securities as the Issuer may, from time to time, reasonably request . The Issuer
may exclude from such registration the Registrable Securities of any seller
which fails to furnish such information within a reasonable time after receiving
such request and in such event shall have no further obligations under Sections
2 or 3 of this Agreement with respect to such seller. Each seller as to which
any Shelf Registration is being effected agrees to furnish promptly to the
Issuer all information required to be disclosed in order that the Prospectus
related thereto shall not contain, with respect to such seller or such seller's
disposition of such Registrable Securities, 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 misleading in light of the circumstances then
existing.
If any such Registration Statement refers to any Holder by name or
otherwise as the holder of any securities of the Issuer, then such Holder shall
have the right to require (i) the insertion therein of language, in form and
substance reasonably satisfactory to such Holder, to the effect that the holding
by such Holder of such securities is not to be construed as a recommendation by
such Holder of the investment quality of the securities covered thereby and that
such holding does not imply that such Holder will assist in meeting any future
financial requirements of the Issuer, or (ii) in the event that such reference
to such Holder by name or otherwise is not required by the Securities Act or any
similar federal statute then in force, the deletion of the reference to such
Holder in any amendment or supplement to the Registration Statement filed or
prepared subsequent to the time that such reference ceases to be required.
Each Holder of Registrable Securities and each Participating
Broker-Dealer agrees by its acquisition of such Registrable Securities or
Exchange Securities to be sold by such Participating Broker-Dealer, as the case
may be, that, upon actual receipt of any notice from the Issuer of the happening
of any event of the kind described in Section 5(c)(ii), 5(c)(iv), 5(c)(v), or
5(c)(vi) hereof, such Holder will forthwith discontinue disposition of such
Registrable Securities covered by such Registration Statement or Prospectus or
Exchange Securities to be sold by such Holder or Participating Broker-Dealer, as
the case may be, until such Holder's or Participating Broker-Dealer's receipt of
the copies of the supplemented or amended Prospectus contemplated by Section
5(k) hereof, or until it is advised in writing (the "Advice") by the Issuer that
the use of the applicable Prospectus may be resumed, and has received copies of
any amendments or supplements thereto. In the event that the Issuer shall give
any such notice, each of the Applicable Period and the Effectiveness Period
shall be extended by the number of days during such periods from and including
the date of the giving of such notice to and including the date when each seller
of Registrable Securities covered by such Registration Statement or Exchange
Securities to be sold by such Participating Broker-Dealer, as the case may be,
shall have received (x) the copies of the supplemented or amended Prospectus
contemplated by Section 5(k) hereof or (y) the Advice.
6. Registration Expenses
All fees and expenses incident to the performance of or compliance with
this Agreement by the Issuer shall be borne by the Issuer, whether or not the
Exchange Offer Registration Statement or any Shelf Registration Statement is
filed or becomes effective or the Exchange Offer is consummated, including,
without limitation, (i) all registration and filing fees (including, without
limitation, (A) fees with respect to filings required to be made with the NASD
in connection with an underwritten offering and (B) fees and expenses of
compliance with state and foreign securities or Blue Sky laws (including,
without limitation, reasonable fees and disbursements of counsel in connection
with Blue Sky qualifications of the Registrable Securities or Exchange
Securities and determination of the eligibility of the Registrable Securities or
Exchange Securities for investment under the laws of such jurisdictions (x)
where the holders of Registrable Securities are located, in the case of the
Exchange Securities, or (y) as provided in Section 5(h) hereof, in the case of
Registrable Securities or Exchange Securities to be sold by a Participating
Broker-Dealer during the Applicable Period)), (ii) printing expenses, including,
without limitation, expenses of printing certificates for Registrable Securities
or Exchange Securities in a form eligible for deposit with The Depository Trust
Company and of printing prospectuses if the printing of prospectuses is
requested by the managing underwriter or underwriters, if any, by the Holders of
a majority in aggregate principal amount of the Registrable Securities included
in any Registration Statement or in respect of Registrable Securities or
Exchange Securities to be sold by any Participating Broker-Dealer during the
Applicable Period, as the case may be, (iii) reasonable messenger, telephone and
delivery expenses relating to preparation of documents referenced herein, (iv)
fees and disbursements of counsel for the Issuer and, in the case of a Shelf
Registration, reasonable fees and disbursements of one special counsel for all
of the sellers of Registrable Securities (exclusive of any counsel retained
pursuant to Section 7 hereof), which counsel shall be reasonably satisfactory to
the Issuer, (v) fees and disbursements of all independent certified public
accountants referred to in Section 5(n)(iii) hereof (including, without
limitation, the expenses of any "cold comfort" letters required by or incident
to such performance), (vi) Securities Act liability insurance, if the Issuer
desires such insurance, (vii) fees and expenses of all other Persons retained by
the Issuer, (viii) internal expenses of the Issuer (including, without
limitation, all salaries and expenses of officers and employees of the Issuer
performing legal or accounting duties), (ix) the expense of any annual audit,
(x) any fees and expenses incurred in connection with the listing of the
securities to be registered on any securities exchange, and the obtaining of a
rating of the securities, in each case, if applicable, and (xi) the expenses
relating to printing, word processing and distributing all Registration
Statements, underwriting agreements, indentures and any other documents
necessary in order to comply with this Agreement. Notwithstanding the foregoing,
the Holders shall pay all agency fees and commissions and underwriting discounts
and commissions attributable to the sale of Registrable Securities and the fees
and disbursements of any counsel or other advisors or experts retained by such
Holders (severally or jointly), other than the counsel and experts referred to
above.
7. Indemnification and Contribution
(a) The Issuer agrees to indemnify and hold harmless each Holder of
Registrable Securities offered pursuant to a Shelf Registration Statement and
each Participating Broker-Dealer selling Exchange Securities during the
Applicable Period, and each Person, if any, who controls such Person or its
affiliates within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act (each, a "Participant") against any losses, claims, damages
or liabilities to which any Participant may become subject under the Act, the
Exchange Act or otherwise, insofar as any such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon:
(i) any untrue statement or alleged untrue statement of any
material fact contained in any Registration Statement (or any amendment
thereto) or Prospectus (as amended or supplemented if the Issuer shall
have furnished any amendments or supplements thereto) or any related
preliminary Prospectus; or
(ii) the omission or alleged omission to state, in any
Registration Statement (or any amendment thereto) or Prospectus (as
amended or supplemented if the Issuer shall have furnished any
amendments or supplements thereto) or any related preliminary
Prospectus a material fact required to be stated therein or necessary
to make the statements therein (in the case of a Prospectus, in light
of circumstances under which they were made) not misleading;
and will reimburse, as incurred, the Participant for any legal or other expenses
reasonably incurred by the Participant in connection with investigating or
defending against with any such loss, claim, damage, liability or action;
provided, however, that the Issuer will not be liable in any such case to the
extent that any such loss, claim, damage, or liability arises out of or is based
upon any untrue statement or alleged untrue statement or omission or alleged
omission made in any Registration Statement (or any amendment thereto) or
Prospectus (as amended or supplemented if any of the Issuer shall have furnished
any amendments or supplements thereto) or any related preliminary Prospectus (i)
made in reliance upon and in conformity with information relating to any
Participant furnished to the Issuer by or on behalf of such Participant
specifically for use therein or (ii) if such Participant sold to the person
asserting the claim the Registrable Securities or Exchange Securities that are
the subject of such claim and such untrue statement or omission or alleged
untrue statement or omission was contained or made in any preliminary Prospectus
and corrected in the Prospectus or any amendment or supplement thereto and the
Prospectus does not contain any other untrue statement or omission or alleged
untrue statement or omission of a material fact that was the subject matter of
the related proceeding and it is established by the Issuer in the related
proceeding that such Participant failed to deliver or provide a copy of the
Prospectus (as amended or supplemented) to such Person with or prior to the
confirmation of the sale of such Registrable Securities or Exchange Notes sold
to such Person if required by applicable law, unless such failure to deliver or
provide a copy of the Prospectus (as amended or supplemented) was a result of
noncompliance by the Issuer with Section 5 of this Agreement. Any
indemnification amounts advanced by the Issuer pursuant to this Section 7 shall
as a result of such losses, claims damages or liabilities shall be returned to
the Issuer if it shall be finally determined by a court of competent
jurisdiction that such Participant was not entitled to such indemnification by
the Issuer. The indemnity provided for in this Section 7 will be in addition to
any liability that the Issuer may otherwise have to the indemnified parties. The
Issuer shall not be liable under this Section 7 for any settlement of any claim
or action effected without its prior written consent, which shall not be
unreasonably withheld.
(b) Each Participant, severally and not jointly, agrees to indemnify
and hold harmless the Issuer, its directors, its officers and each Person, if
any, who controls the Issuer within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act against any losses, claims, damages or
liabilities to which the Issuer or any such director, officer or controlling
Person may become subject under the Securities Act, the Exchange Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon (i) any untrue statement or
alleged untrue statement of any material fact contained in any Registration
Statement or Prospectus, any amendment or supplement thereto, or any related
preliminary Prospectus, or (ii) the omission or the alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only to the
extent, that such untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with written
information concerning such Participant, furnished to the Issuer by or on behalf
of the Participant, specifically for use therein; and subject to the limitation
set forth immediately preceding this clause, will reimburse, as incurred, any
legal or other expenses incurred by the Issuer or any such director, officer or
controlling Person in connection with investigating or defending against any
such loss, claim, damage, liability or action in respect thereof. The indemnity
provided for in this Section 7 will be in addition to any liability that the
Participants may otherwise have to the indemnified parties. The Participants
shall not be liable under this Section 7 for any settlement of any claim or
action effected without their consent, which shall not be unreasonably withheld.
The Issuer shall not, without the prior written consent of such Participant,
effect any settlement or compromise of any pending or threatened proceeding in
respect of which any Participant is or could have been a party, or indemnity
could have been sought hereunder by any Participant, unless such settlement (A)
includes an unconditional written release of the Participants, in form and
substance reasonably satisfactory to the Participants, from all liability on
claims that are the subject matter of such proceeding and (B) does not include
any statement as to an admission of fault, culpability or failure to act by or
on behalf of any Participant.
(c) Promptly after receipt by an indemnified party under this Section 7
of notice of the commencement of any action for which such indemnified party is
entitled to indemnification under this Section 7, such indemnified party will,
if a claim in respect thereof is to be made against the indemnifying party under
this Section 7, notify the indemnifying party of the commencement thereof in
writing; but the omission to so notify the indemnifying party (i) will not
relieve it from any liability under paragraph (a) or (b) above unless and to the
extent such failure results in the forfeiture by the indemnifying party of
substantial rights and defenses and (ii) will not, in any event, relieve the
indemnifying party from any obligations to any indemnified party other than the
indemnification obligation provided in paragraphs (a) and (b) above. In case any
such action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party;
provided, however, that if (i) the use of counsel chosen by the indemnifying
party to represent the indemnified party would present such counsel with a
conflict of interest, (ii) the defendants in any such action include both the
indemnified party and the indemnifying party and the indemnified party shall
have been advised by counsel that there may be one or more legal defenses
available to it and/or other indemnified parties that are different from or
additional to those available to the indemnifying party, or (iii) the
indemnifying party shall not have employed counsel reasonably satisfactory to
the indemnified party to represent the indemnified party within a reasonable
time after receipt by the indemnifying party of notice of the institution of
such action, then, in each such case, the indemnifying party shall not have the
right to direct the defense of such action on behalf of such indemnified party
or parties and such indemnified party or parties shall have the right to select
separate counsel to defend such action on behalf of such indemnified party or
parties. After notice from the indemnifying party to such indemnified party of
its election so to assume the defense thereof and approval by such indemnified
party of counsel appointed to defend such action, the indemnifying party will
not be liable to such indemnified party under this Section 7 for any legal or
other expenses, other than reasonable costs of investigation, subsequently
incurred by such indemnified party in connection with the defense thereof,
unless (i) the indemnified party shall have employed separate counsel in
accordance with the proviso to the immediately preceding sentence (it being
understood, however, that in connection with such action the indemnifying party
shall not be liable for the expenses of more than one separate counsel (in
addition to local counsel) in any one action or separate but substantially
similar actions in the same jurisdiction arising out of the same general
allegations or circumstances, designated by Participants who sold a majority in
interest of the Registrable Securities and Exchange Securities sold by all such
Participants in the case of paragraph (a) of this Section 7 or the Issuer in the
case of paragraph (b) of this Section 7, representing the indemnified parties
under such paragraph (a) or paragraph (b), as the case may be, who are parties
to such action or actions) or (ii) the indemnifying party has authorized in
writing the employment of counsel for the indemnified party at the expense of
the indemnifying party. All fees and expenses reimbursed pursuant to this
paragraph (c) shall be reimbursed as they are incurred. After such notice from
the indemnifying party to such indemnified party, the indemnifying party will
not be liable for the costs and expenses of any settlement of such action
effected by such indemnified party without the prior written consent of the
indemnifying party (which consent shall not be unreasonably withheld), unless
such indemnified party waived in writing its rights under this Section 7, in
which case the indemnified party may effect such a settlement without such
consent.
(d) In circumstances in which the indemnity agreement provided for in
the preceding paragraphs of this Section 7 is unavailable to, or insufficient to
hold harmless, an indemnified party in respect of any losses, claims, damages or
liabilities (or actions in respect thereof), each indemnifying party, in order
to provide for just and equitable contribution, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
damages or liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect the relative fault of the indemnifying party or parties
on the one hand and the indemnified party on the other in connection with the
statements or omissions or alleged statements or omissions that resulted in such
losses, claims, damages or liabilities (or actions in respect thereof). The
relative fault of the parties 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 the Issuer on the one hand, or the Participants on the other, the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission or alleged statement or omission,
and any other equitable considerations appropriate in the circumstances. The
parties agree that it would not be equitable if the amount of such contribution
were determined by pro rata or per capita allocation or by any other method of
allocation that does not take into account the equitable considerations referred
to in the first sentence of this paragraph (d). Notwithstanding any other
provision of this paragraph (d), no Participant shall be obligated to make
contributions hereunder in excess of the amount by which proceeds received by
such Participant in connection with the sale of the Securities exceed the amount
of any damages that such Participant has otherwise been required to pay by
reason of the untrue or alleged untrue statements or the omissions or alleged
omissions to state a material fact, and no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any Person who was not guilty of such fraudulent
misrepresentation. For purposes of this paragraph (d), each Person, if any, who
controls a Participant 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
Participants, and each director of the Issuer, each officer of the Issuer and
each person, if any, who controls the Issuer within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act, shall have the same rights to
contribution as the Issuer.
8. Rules 144 and 144A
The Issuer covenants and agrees that, to the extent required under the
Exchange Act, it will timely file the reports required to be filed by it under
the Securities Act and the Exchange Act and the rules and regulations adopted by
the SEC thereunder in a timely manner in accordance with the requirements of the
Securities Act and the Exchange Act and, if at any time the Issuer is not
required to file such reports, the Issuer will, upon the request of any Holder
of Registrable Securities, make available such information necessary to permit
sales pursuant to Rule 144A. The Issuer further covenants and agrees, for so
long as any Registrable Securities remain outstanding that it will take such
further action as any Holder of Registrable Securities 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(k) under the Securities Act
and Rule 144A.
9. Underwritten Registrations
If any of the Registrable Securities covered by any Shelf Registration
are to be sold in an underwritten offering, the investment banker or investment
bankers and manager or managers that will manage the offering will be selected
by the Holders of a majority in aggregate principal amount of such Registrable
Securities included in such offering and shall be reasonably acceptable to the
Issuer.
No Holder of Registrable Securities may participate in any underwritten
registration hereunder unless such Holder (a) agrees to sell such Holder's
Registrable 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 questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents required under the terms of such
underwriting arrangements.
10. Miscellaneous
(a) No Inconsistent Agreements. The Issuer has not, as of the date
hereof, and the Issuer shall not, after the date of this Agreement, enter into
any agreement with respect to any of its securities that is inconsistent with
the rights granted to the Holders of Registrable Securities in this Agreement or
otherwise conflicts with the provisions hereof. 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 Issuer's other issued and outstanding
securities under any such agreements. The Issuer will not enter into any
agreement with respect to any of its securities which will grant to any Person
piggy-back registration rights with respect to any Registration Statement.
(b) Adjustments Affecting Registrable Securities. The Issuer shall not,
directly or indirectly, take any action with respect to the Registrable
Securities as a class that would adversely affect the ability of the Holders of
Registrable Securities to include such Registrable Securities in a registration
undertaken pursuant to this Agreement.
(c) Amendments and Waivers. The provisions of this Agreement may not be
amended, modified or supplemented, and waivers or consents to departures from
the provisions hereof may not be given, otherwise than with the prior written
consent of (I) the Issuer, and (II)(A) the Holders of not less than a majority
in aggregate principal amount of the then outstanding Registrable Securities and
(B) in circumstances that would adversely affect the Participating
Broker-Dealers, the Participating Broker-Dealers holding not less than a
majority in aggregate principal amount of the Exchange Securities held by all
Participating Broker-Dealers; provided, however, that Section 7 and this Section
10(c) may not be amended, modified or supplemented without the prior written
consent of each Holder and each Participating Broker-Dealer (including any
person who was a Holder or Participating Broker-Dealer of Registrable Securities
or Exchange Securities, as the case may be, disposed of pursuant to any
Registration Statement) affected by any such amendment, modification or
supplement. 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, impair, limit or compromise the rights of other Holders of Registrable
Securities may be given by Holders of at least a majority in aggregate principal
amount of the Registrable Securities being sold pursuant to such Registration
Statement.
(d) Notices. All notices and other communications (including, without
limitation, any notices or other communications to the Trustee) provided for or
permitted hereunder shall be made in writing by hand-delivery, registered
first-class mail, next-day air courier or facsimile:
(i) if to a Holder of the Registrable Securities or any
Participating Broker-Dealer, at the most current address of such Holder
or Participating Broker-Dealer, as the case may be, set forth on the
records of the registrar under the Indenture, with a copy in like
manner to the Initial Purchaser as follows:
Deutsche Bank AG London
1 Great Winchester Street
London EC2N 2DB
United Kingdom
Facsimile No.:
Attention: Corporate Finance
with a copy to:
Cahill Gordon & Reindel LLP
80 Pine Street
New York, New York 10005
Facsimile No.: (212) 269-5420
Attention: William B. Gannett, Esq.
(ii) if to the Initial Purchaser, at the address specified in
Section 10(d)(i);
(iii) if to the Issuer, at the address as follows:
c/o Kronos International, Inc.
5430 LBJ Freeway
Suite 1700
Dallas, TX 75240
Facsimile No.: (972) 448-1445
Attention: Robert D. Graham
with a copy to:
Locke Liddell & Sapp LLP
2200 Ross Avenue
Suite 2200
Dallas, TX 75201
Facsimile No.: (214) 740-8800
Attention: Don M. Glendenning, Esq.
All such notices and communications shall be deemed to have been duly
given: when delivered by hand, if personally delivered; five Business Days after
being deposited in the mail, postage prepaid, if mailed; one Business Day after
being timely delivered to a next-day air courier; and when receipt is
acknowledged by the addressee, if sent by facsimile.
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address and in the manner specified in such Indenture.
(e) Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the successors and assigns of each of the parties hereto,
the Holders and the Participating Broker-Dealers; provided, however, that
nothing herein shall be deemed to permit any assignment, transfer or other
disposition of Registrable Securities in violation of the terms of the Purchase
Agreement or the Indenture.
(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 an 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 LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE
AND PERFORMED ENTIRELY WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW THAT WOULD REQUIRE THE APPLICATION OF ANY OTHER
LAW.
(i) Severability. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction 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, 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 is hereby stipulated and declared
to be the intention of the parties that they would have executed the remaining
terms, provisions, covenants and restrictions without including any of such that
may be hereafter declared invalid, illegal, void or unenforceable.
(j) Securities Held by the Issuer or its Affiliates. Whenever the
consent or approval of Holders of a specified percentage of Registrable
Securities is required hereunder, Registrable Securities held by the Issuer or
its affiliates (as such term is defined in Rule 405 under the Securities Act)
shall not be counted in determining whether such consent or approval was given
by the Holders of such required percentage.
(k) Third-Party Beneficiaries. Holders of Registrable Securities and
Participating Broker-Dealers are intended third-party beneficiaries of this
Agreement, and this Agreement may be enforced by such Persons.
(l) Entire Agreement. This Agreement, together with the Purchase
Agreement and the Indenture, is intended by the parties as a final and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein and therein and any and all prior oral or
written agreements, representations, or warranties, contracts, understandings,
correspondence, conversations and memoranda between the Holders on the one hand
and the Issuer on the other, or between or among any agents, representatives,
parents, subsidiaries, affiliates, predecessors in interest or successors in
interest with respect to the subject matter hereof and thereof are merged herein
and replaced hereby.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
KRONOS INTERNATIONAL, INC.
By:
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Name:
Title:
The foregoing Agreement is hereby
confirmed and accepted as of the
date first above written.
DEUTSCHE BANK AG LONDON
By:
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Name:
Title:
By:
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Name:
Title: