Exhibit 4.3
$93,750,000 PRINCIPAL AMOUNT AT MATURITY
GOLFSMITH INTERNATIONAL, INC.
8.375% OF SENIOR SECURED NOTES DUE 2009
REGISTRATION RIGHTS AGREEMENT
October 15, 2002
XXXXXXXXX & COMPANY, INC.
00000 Xxxxx Xxxxxx Xxxxxxxxx
00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Ladies and Gentlemen:
GOLFSMITH INTERNATIONAL, INC., a Delaware corporation (the "Company"), is
issuing and selling to Xxxxxxxxx & Company, Inc (the "Initial Purchaser"), upon
the terms set forth in the Purchase Agreement dated October 8, 2002 among
Atlantic Equity Partners III, L.P., a Delaware limited partnership ("AEP"),
Golfsmith International Holdings, Inc., a Delaware corporation ("Holdings"), BGA
Acquisition Corporation, a Delaware corporation, and the Initial Purchaser, as
acceded to by the Company and the subsidiaries of the Company named therein
pursuant to Amendment No. 1 thereto (the "Purchase Agreement"), $93,750,000
aggregate principal amount at maturity of 8.375% Senior Secured Notes due 2009
issued by the Company (each, a "Note" and collectively, the "Notes"). As an
inducement to the Initial Purchaser to enter into the Purchase Agreement, the
Company and the Guarantors (as defined below) agree with the Initial Purchaser,
for the benefit of the Holders (as defined below) of the Notes (including,
without limitation, the Initial Purchaser), as follows:
1. DEFINITIONS
Capitalized terms that are used herein without definition and are defined
in the Purchase Agreement shall have the respective meanings ascribed to them in
the Purchase Agreement. As used in this Agreement, the following terms shall
have the following meanings:
ADDITIONAL INTEREST: See Section 4(a).
ADVICE: See Section 6(v).
AGREEMENT: This Registration Rights Agreement, dated as of the Closing
Date, between the Company and the Initial Purchaser.
APPLICABLE PERIOD: See Section 2(e).
BUSINESS DAY: A day that is not a Saturday, a Sunday or a day on which
banking institutions in the City of New York are authorized or required by law
or executive order to be closed.
CLOSING DATE: October 15, 2002.
COLLATERAL AGREEMENTS: Shall have the meaning set forth in the Indenture.
COMPANY: See the introductory paragraph to this Agreement.
DAY: Unless otherwise expressly provided, a calendar day.
EFFECTIVENESS DATE: The 180th day after the Issue Date.
EFFECTIVENESS PERIOD: See Section 3(a).
EVENT DATE: See Section 4(b).
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended, and the
rules and regulations of the SEC promulgated thereunder.
EXCHANGE NOTES: Senior Secured Notes due 2009 of the Company, identical in
all material respects to the Notes, including the guarantees endorsed thereon,
except for restrictive legends and additional interest provisions.
EXCHANGE OFFER: See Section 2(a).
EXCHANGE REGISTRATION STATEMENT: See Section 2(a).
FILING DATE: The 120th day after the Issue Date.
GUARANTORS: Shall mean Holdings and the Subsidiary Guarantors.
HOLDER: Any registered holder of Registrable Notes.
INDEMNIFIED PARTY: See Section 8(c).
INDEMNIFYING PARTY: See Section 8(c).
INDENTURE: The Indenture, dated as of the Closing Date, among the Company,
the Guarantors and U. S. Bank Trust National Association, as trustee, pursuant
to which the Notes are being issued, as amended or supplemented from time to
time in accordance with the terms hereof.
INITIAL PURCHASER: See the introductory paragraph to this Agreement.
INITIAL SHELF REGISTRATION: See Section 3(a).
INSPECTORS: See Section 6(o).
ISSUE DATE: October 15, 2002
LOSSES: See Section 8(a).
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NASD: National Association of Securities Dealers, Inc.
NOTES: Shall mean the Notes (as set forth in the introductory paragraph to
this Agreement) and the related Guarantees thereon.
PARTICIPATING BROKER-DEALER: See Section 2(e).
PERSON: An individual, trustee, corporation, partnership, limited
liability company, joint stock company, trust, unincorporated association,
union, business association, firm, government or agency or political subdivision
thereof, or other legal entity.
PRIVATE EXCHANGE: See Section 2(f).
PRIVATE EXCHANGE NOTES: See Section 2(f).
PROSPECTUS: 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 prospectus supplement, with respect to the terms
of the offering of any portion of the Registrable Notes covered by such
Registration Statement, 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 paragraph to this Agreement.
RECORDS: See Section 6(o).
REGISTRABLE NOTES: (i) Notes, (ii) Private Exchange Notes and (iii)
Exchange Notes received in the Exchange Offer, in each case, that may not be
sold without restriction under federal or state securities laws.
REGISTRATION STATEMENT: Any registration statement of the Company and the
Guarantors filed with the SEC under the Securities Act (including, but not
limited to, the Exchange Registration Statement, the Shelf Registration and any
subsequent Shelf Registration) that covers any of the Registrable Notes 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 material incorporated by reference or deemed to be
incorporated by reference in such registration statement.
RULE 144: Rule 144 promulgated under the Securities Act, as such Rule may
be amended from time to time, or any similar rule (other than Rule 144A) or
regulation hereafter adopted by the SEC providing for offers and sales of
securities made in compliance therewith resulting in offers and sales by
subsequent holders that are not affiliates of an issuer or such securities being
free of the registration and prospectus delivery requirements of the Securities
Act.
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RULE 144A: Rule 144A promulgated under the Securities Act, as such Rule
may be amended from time to time, or any similar rule (other than Rule 144) or
regulation hereafter adopted by the SEC.
RULE 415: Rule 415 promulgated 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 430A: Rule 430A promulgated 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.
SEC: The Securities and Exchange Commission.
SECURITIES: The Notes, the Exchange Notes and the Private Exchange Notes.
SECURITIES ACT: The Securities Act of 1933, as amended, and the rules and
regulations of the SEC promulgated thereunder.
SHELF NOTICE: See Section 2(j).
SHELF REGISTRATION: See Section 3(b).
SUBSEQUENT SHELF REGISTRATION: See Section 3(b).
SUBSIDIARY GUARANTOR: Each subsidiary of the Company that guarantees the
obligations of the Company under the Notes and the Indenture.
TIA: The Trust Indenture Act of 1939, as amended.
TRUSTEE: The trustee under the Indenture and, if existent, the trustee
under any indenture governing the Exchange Notes and Private Exchange Notes (if
any).
UNDERWRITTEN REGISTRATION OR UNDERWRITTEN OFFERING: A registration in
which securities of the Company are sold to an underwriter for reoffering to the
public.
2. EXCHANGE OFFER
(a) Unless the Exchange Offer would not be permitted by applicable
federal law or a policy of the SEC, the Company shall (and shall
cause each Guarantor with respect to its guarantee to) (i) prepare
and file with the SEC promptly after the date hereof, but in no
event later than the Filing Date, a registration statement (the
"Exchange Registration Statement") on an appropriate form under the
Securities Act with respect to an offer (the "Exchange Offer") to
the Holders of Notes to issue and deliver to such Holders, in
exchange for the Notes, a like principal amount of Exchange Notes,
(ii) use its reasonable best efforts to cause the Exchange
Registration Statement to become effective as promptly as
practicable after the filing thereof, but in no event later than the
Effectiveness Date, (iii) use its reasonable best efforts to keep
the Exchange Registration Statement effective until the consummation
of the Exchange Offer in accordance with its terms, and
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(iv) commence the Exchange Offer and use its reasonable best efforts
to issue on or prior to 30 Business Days after the date on which the
Exchange Registration Statement is declared effective, Exchange
Notes in exchange for all Notes tendered prior thereto in the
Exchange Offer. The Exchange Offer shall not be subject to any
conditions, other than that the Exchange Offer does not violate
applicable law or any applicable interpretation of the staff of the
SEC.
(b) The Exchange Notes shall be issued under, and entitled to the
benefits of, (i) the Indenture or a trust indenture that is
identical to the Indenture (other than such changes as are necessary
to comply with any requirements of the SEC to effect or maintain the
qualifications thereof under the TIA) and (ii) the Collateral
Agreements.
(c) Interest on the Exchange Notes and Private Exchange Notes will
accrue from the last interest payment date on which interest was
paid on the Notes surrendered in exchange therefor or, if no
interest has been paid on the Notes, from the date of original issue
of the Notes. Each Exchange Note and Private Exchange Note shall
bear interest at the rate set forth thereon; provided, that interest
with respect to the period prior to the issuance thereof shall
accrue at the rate or rates borne by the Notes from time to time
during such period.
(d) The Company may require each Holder as a condition to participation
in the Exchange Offer to represent (i) that any Exchange Notes
received by it will be acquired in the ordinary course of its
business, (ii) that at the time of the commencement and consummation
of the Exchange Offer such Holder has not entered into any
arrangement or understanding with any Person to participate in the
distribution (within the meaning of the Securities Act) of the
Exchange Notes in violation of the provisions of the Securities Act,
(iii) that if such Holder is an affiliate of the Company within the
meaning of the Securities Act, it will comply with the registration
and prospectus delivery requirements of the Securities Act to the
extent applicable to it, (iv) if such Holder is not a broker-dealer,
that it is not engaged in, and does not intend to engage in, the
distribution of the Notes and (v) if such Holder is a Participating
Broker-Dealer, that it will deliver a Prospectus in connection with
any resale of the Exchange Notes.
(e) The Company shall include within the Prospectus contained in the
Exchange Registration Statement a section entitled "Plan of
Distribution" which shall contain all information that the SEC may
require 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 Notes received by such
broker-dealer in the Exchange Offer for its own account in exchange
for Notes that were acquired by it as a result of market-making or
other trading activity (a "Participating Broker-Dealer"). Such "Plan
of Distribution" section shall also allow, 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 so
permitted, all Participating Broker-Dealers, and include a statement
describing the manner in
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which Participating Broker-Dealers may resell the Exchange Notes.
The Company shall use reasonable best efforts to keep the Exchange
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 180 days after
consummation of the Exchange Offer; provided, however, that (i) in
the case where such Prospectus and any amendment or supplement
thereto must be delivered by a Participating Broker-Dealer or the
Initial Purchaser, such period shall be the lesser of 180 days and
the date on which all Participating Broker-Dealers and the Initial
Purchaser have sold all Exchange Notes held by them (unless such
period is extended pursuant to Section 6(k) below) and (ii) the
Company shall make such Prospectus and any amendment or supplement
thereto available to any Participating Broker-Dealer for use in
connection with any resale of any Exchange Notes for a period not
less than 90 days after the consummation of the Exchange Offer (the
"Applicable Period").
(f) If, upon consummation of the Exchange Offer, either the Initial
Purchaser or AEP holds any Notes acquired by it and having the
status of an unsold allotment in the initial distribution, the
Company (upon the written request from the Initial Purchaser or AEP,
as the case may be) shall, simultaneously with the delivery of the
Exchange Notes in the Exchange Offer, issue and deliver to the
Initial Purchaser or AEP, as the case may be, in exchange (the
"Private Exchange") for the Notes held by the Initial Purchaser, a
like principal amount of Senior Secured Notes that are identical to
the Exchange Notes except for the existence of restrictions on
transfer thereof under the Securities Act and securities laws of the
several states of the United States (the "Private Exchange Notes")
(and which are issued pursuant to the same indenture as the Exchange
Notes). The Private Exchange Notes shall bear the same CUSIP number
as the Exchange Notes.
(g) In connection with the Exchange Offer, the Company shall:
(i) mail to each Holder a copy of the Prospectus forming part of
the Exchange Registration Statement, together with an
appropriate letter of transmittal and related documents;
(ii) utilize the services of a depository for the Exchange Offer
with an address in the Borough of Manhattan, the City of New
York, which may be the Trustee or an affiliate thereof;
(iii) permit Holders to withdraw tendered Registrable Notes at any
time prior to the close of business, New York time, on the
last Business Day on which the Exchange Offer shall remain
open; and
(iv) otherwise comply in all material respects with all applicable
laws.
(h) As soon as practicable after the close of the Exchange Offer or the
Private Exchange, as the case may be, the Company shall:
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(i) accept for exchange all Registrable Notes validly tendered
pursuant to the Exchange Offer or the Private Exchange, as the
case may be, and not validly withdrawn;
(ii) deliver to the Trustee for cancellation all Registrable Notes
so accepted for exchange; and
(iii) cause the Trustee to authenticate and deliver promptly to each
Holder tendering such Registrable Notes, Exchange Notes or
Private Exchange Notes, as the case may be, equal in principal
amount at maturity to the Notes of such Holder so accepted for
exchange.
(i) The Exchange Notes and the Private Exchange Notes may be issued
under (i) the Indenture or (ii) an indenture identical in all
material respects to the Indenture, which in either event will
provide that the Exchange Notes will not be subject to the transfer
restrictions or additional interest provisions set forth in the
Indenture, that the Private Exchange Notes will be subject to the
transfer restrictions set forth in the Indenture, and that the
Exchange Notes, the Private Exchange Notes and the Notes, if any,
will be deemed one class of security (subject to the provisions of
the Indenture) and entitled to participate in all the security
granted by the Company pursuant to the Collateral Agreements and in
any Subsidiary Guarantee (as such terms are defined in the
Indenture) on an equal and ratable basis.
(j) If, (i) applicable interpretations of the staff of the SEC would not
permit the consummation of the Exchange Offer as contemplated by
this Section 2, (ii) the Exchange Offer is not consummated within 30
Business Days after the Effectiveness Date for any reason, (iii) any
holder of Private Exchange Notes so requests in writing to the
Company within 45 days after the consummation of the Exchange Offer
or (iv) in the case of any Holder not permitted by applicable law or
SEC policy to participate in the Exchange Offer or any Holder that
participates in the Exchange Offer but does not receive Exchange
Notes 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 Company
within the meaning of the Securities Act) and so notifies the
Company within 45 days of consummation of the Exchange Offer, then
the Company (and any then existing Guarantor) shall promptly deliver
to the Holders and the Trustee written notice thereof (the "Shelf
Notice") and shall file an Initial Shelf Registration pursuant to
Section 3.
3. SHELF REGISTRATION
If a Shelf Notice is delivered pursuant to Section 2(j), then this Section
3 shall apply to all Registrable Notes. Otherwise, upon consummation of the
Exchange Offer in accordance with Section 2, the provisions of this Section 3
shall apply solely with respect to (i) Notes held by any Holder thereof not
permitted by applicable law or SEC policy to participate in the Exchange Offer
and (ii) Exchange Notes that are not freely tradeable as contemplated by Section
2(j)(iv)
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hereof, provided in each case that the relevant Holder has duly notified the
Company within 45 days of the Exchange Offer as required by Section 2(j)(iv).
(a) Initial Shelf Registration. The Company shall as promptly as
practicable after the date of the Shelf Notice file (and shall cause
any then existing Guarantor 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 Notes (the "Initial
Shelf Registration"). If the Company (and any then existing
Guarantor) has not yet filed an Exchange Registration Statement, the
Company shall file (and shall cause any then existing Guarantor to
file) with the SEC the Initial Shelf Registration on or prior to the
Filing Date and shall use its reasonable best efforts to cause such
Initial Shelf Registration to be declared effective under the
Securities Act on or prior to the Effectiveness Date. Otherwise, the
Company shall use its reasonable best efforts to file (and shall
cause any then existing Guarantor to file) with the SEC the Initial
Shelf Registration within 30 days of the delivery of the Shelf
Notice and shall use its reasonable best efforts to cause such Shelf
Registration to be declared effective under the Securities Act as
promptly as practicable thereafter (but in no event more than 90
days after delivery of the Shelf Notice). The Initial Shelf
Registration shall be on Form S-1 or another appropriate form
permitting registration of such Registrable Notes for resale by
Holders in the manner or manners reasonably designated by them
(including, without limitation, one or more underwritten offerings).
The Company and Guarantors shall not permit any securities other
than the Registrable Notes to be included in any Shelf Registration.
No Holder of Registrable Notes shall be entitled to include any of
its Registrable Notes in any Shelf Registration pursuant to this
Agreement unless such Holder furnishes to the Company and the
Trustee in writing, within 20 days after receipt of a written
request therefor, such information as the Company and the Trustee
after conferring with counsel with regard to information relating to
Holders that would be required by the SEC to be included in such
Shelf Registration or Prospectus included therein, may reasonably
request for inclusion in any Shelf Registration or Prospectus
included therein. The Company shall use its reasonable best efforts
to keep the Initial Shelf Registration continuously effective under
the Securities Act until the date which is two years from the
Closing Date (the "Effectiveness Period"), or such shorter period
ending when (i) all Registrable Notes covered by the Initial Shelf
Registration have been sold in the manner set forth and as
contemplated in the Initial Shelf Registration or (ii) a Subsequent
Shelf Registration covering all of the Registrable Notes covered by
and not sold under the Initial Shelf Registration or an earlier
Subsequent Shelf Registration has been declared effective under the
Securities Act.
(b) Subsequent Shelf Registrations. If the Initial Shelf Registration or
any Subsequent Shelf Registration (as defined below) 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), the Company shall use its reasonable best efforts to
obtain the prompt withdrawal of any order suspending the
effectiveness thereof, and in any event shall within 30 days of such
cessation of effectiveness amend such Shelf Registration in a manner
designed to obtain the
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withdrawal of the order suspending the effectiveness thereof, or
file (and cause any then existing Guarantor to file) an additional
"shelf" Registration Statement pursuant to Rule 415 covering all of
the Registrable Notes (a "Subsequent Shelf Registration"). If a
Subsequent Shelf Registration is filed, the Company shall use its
reasonable best efforts to cause the Subsequent Shelf Registration
to be declared effective as soon as practicable after such filing
and to keep such Subsequent Shelf Registration continuously
effective for a period equal to the number of days in the
Effectiveness Period less the aggregate number of days during which
the Initial Shelf Registration or any Subsequent Shelf Registration
was previously continuously effective. As used herein the term
"Shelf Registration" means the Initial Shelf Registration and any
Subsequent Shelf Registrations.
(c) Supplements and Amendments. The Company shall promptly supplement
and amend any 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 in writing by the Holders of a majority in
aggregate principal amount of the Registrable Notes covered by such
Shelf Registration or by any underwriter of such Registrable Notes.
4. ADDITIONAL INTEREST
(a) The Company acknowledges and agrees that the Holders of Registrable
Notes will suffer damages if the Company fails to fulfill its
material 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 Company agrees to pay additional cash
interest on the Notes ("Additional Interest") under the
circumstances and to the extent set forth below (each of which shall
be given independent effect):
(i) if neither the Exchange Registration Statement nor the Initial
Shelf Registration has been filed on or prior to the Filing
Date, Additional Interest shall accrue on the Notes over and
above any stated interest at a rate of 0.25% per annum of the
principal amount of such Notes for the first 90 days
immediately following the Filing Date, such Additional
Interest rate increasing by an additional 0.25% per annum at
the beginning of each subsequent 90-day period, subject to the
proviso in the last sentence of this paragraph;
(ii) if neither the Exchange Registration Statement nor the Initial
Shelf Registration is declared effective on or prior to the
Effectiveness Date, Additional Interest shall accrue on the
Notes over and above any stated interest at a rate of 0.25%
per annum of the principal amount of such Notes for the first
90 days immediately following the Effectiveness Date, such
Additional Interest rate increasing by an additional 0.25% per
annum at the beginning of each subsequent 90-day period,
subject to the proviso in the last sentence of this paragraph;
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(iii) if (A) the Company (and any then existing Guarantor) has not
exchanged Exchange Notes for all Notes validly tendered in
accordance with the terms of the Exchange Offer on or prior to
30 Business Days after the Effectiveness Date, (B) the
Exchange Registration Statement ceases to be effective at any
time prior to the time that the Exchange Offer is consummated,
(C) if applicable, a Shelf Registration has been declared
effective and such Shelf Registration ceases to be effective
at any time prior to the second anniversary of its effective
date (other than such time as all Notes have been disposed of
thereunder) and is not declared effective again within 30
days, or (D) pending the announcement of a material corporate
transaction, the Company issues a written notice pursuant to
Section 6(e)(v) or (vi) that a Shelf Registration Statement or
Exchange Registration Statement is unusable and the aggregate
number of days in any 365-day period for which all such
notices issued or required to be issued, have been, or were
required to be, in effect exceeds 120 days in the aggregate or
30 days consecutively, in the case of a Shelf Registration
statement, or 15 days in the aggregate in the case of an
Exchange Registration Statement, then Additional Interest
shall accrue on the Notes, over and above any stated interest,
at a rate of 0.25% per annum of the principal amount of such
Notes commencing on (w) the 31st Business Day after the
Effectiveness Date, in the case of (A) above, or (x) the date
the Exchange Registration Statement ceases to be effective
without being declared effective again within 30 days, in the
case of clause (B) above, or (y) the day such Shelf
Registration ceases to be effective in the case of (C) above,
or (z) the day the Exchange Registration Statement or Shelf
Registration ceases to be usable in case of clause (D) above,
such Additional Interest rate increasing by an additional
0.25% per annum at the beginning of each such subsequent
90-day period, subject to the proviso in the last sentence of
this paragraph;
provided, however, that the maximum Additional Interest rate on the
Notes may not exceed at any one time in the aggregate 0.50% per
annum; and provided further, that (1) upon the filing of the
Exchange Registration Statement or Initial Shelf Registration (in
the case of (i) above), (2) upon the effectiveness of the Exchange
Registration Statement or Initial Shelf Registration (in the case of
(ii) above), or (3) upon the exchange of Exchange Notes for all
Notes tendered (in the case of (iii)(A) above), or upon the
effectiveness of the Exchange Registration Statement that had ceased
to remain effective (in the case of clause (iii)(B) above), or upon
the effectiveness of a Shelf Registration which had ceased to remain
effective (in the case of (iii)(C) above), Additional Interest on
the Notes as a result of such clause (or the relevant subclause
thereof) or upon the effectiveness of such Registration Statement or
Exchange Registration Statement (in the case of clause (iii)(D)
above), as the case may be, shall cease to accrue.
(b) The Company shall notify the Trustee within 3 Business Days 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
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pursuant to clause (a)(i), (a)(ii) or (a)(iii) of this Section 4
will be payable in cash, on the dates and in the manner provided in
the Indenture and whether or not any cash interest would then be
payable on such date, commencing with the first such semi-annual
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 Notes, 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. HOLD-BACK AGREEMENTS
The Company agrees that it will not effect any public or private sale or
distribution (including a sale pursuant to Regulation D under the Securities
Act) of any securities the same as or substantially similar to those covered by
a Registration Statement filed pursuant to Section 2 or 3 hereof (other than
Additional Notes (as defined in the Indenture) issued under the Indenture), or
any securities convertible into or exchangeable or exercisable for such
securities, during the 10 days prior to, and during the 90-day period beginning
on, the effective date of any Registration Statement filed pursuant to Sections
2 and 3 hereof unless the Holders of a majority in the aggregate principal
amount of the Registrable Notes to be included in such Registration Statement
consent, if the managing underwriter thereof so requests in writing.
6. REGISTRATION PROCEDURES
In connection with the filing of any Registration Statement pursuant to
Section 2 or 3 hereof, the Company shall effect such registrations to permit the
sale of such 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 Company hereunder, the Company shall:
(a) Prepare and file with the SEC as soon as practicable after the date
hereof but in any event on or prior to the Filing Date, the Exchange
Registration Statement or if the Exchange Registration Statement is
not filed because of the circumstances contemplated by Section 2(j),
a Shelf Registration as prescribed by Section 3, and use its
reasonable best efforts to cause each such Registration Statement to
become effective and remain effective as provided herein; provided
that, if (1) a Shelf Registration is filed pursuant to Section 3 or
(2) a Prospectus contained in an Exchange Registration Statement
filed pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period before filing any
Registration Statement or Prospectus or any amendments or
supplements thereto the Company shall, if requested, furnish to and
afford the Holders of the Registrable Notes to be registered
pursuant to such Shelf Registration Statement, or each Participating
Broker-Dealer and to their counsel and the managing underwriters, if
any, a reasonable opportunity to review copies of all such
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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 5 Business Days prior to such filing). The
Company shall not file any such Registration Statement or Prospectus
or any amendments or supplements thereto in respect of which the
Holders must provide information for the inclusion therein without
the Holders being afforded an opportunity to review such
documentation if the holders of a majority in aggregate principal
amount of the Registrable Notes covered by such Registration
Statement, or any such Participating Broker-Dealer, as the case may
be, their counsel, or the managing underwriters, if any, shall
reasonably object in writing on a timely basis.
(b) Provide an indenture trustee for the Registrable Notes, the Exchange
Notes or the Private Exchange Notes, as the case may be, and cause
the Indenture (or other indenture relating to the Registrable Notes)
to be qualified under the TIA not later than the effective date of
the first Registration Statement; and in connection therewith, to
effect such changes 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 reasonable 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.
(c) Prepare and file with the SEC such amendments and post-effective
amendments to each Shelf Registration or Exchange Registration
Statement, as the case may be, as may be necessary to keep such
Registration Statement continuously effective for the Effectiveness
Period or the Applicable Period, 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 (or any similar provisions then in force)
promulgated under the Securities Act; and comply with the provisions
of the Securities Act and the Exchange Act applicable to them 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 Company shall not, during the Applicable
Period, voluntarily take any action that would result in selling
Holders of the Registrable Notes covered by a Registration Statement
or Participating Broker-Dealers seeking to sell Exchange Notes not
being able to sell such Registrable Notes or such Exchange Notes
during that period, unless such action is required by applicable
law, rule or regulation or permitted by this Agreement.
(d) Furnish to such selling Holders and Participating Broker-Dealers who
so request in writing (i) upon the Company's receipt, a copy of the
order of the SEC declaring such Registration Statement and any post
effective amendment thereto effective, (ii) such reasonable number
of copies of such Registration Statement and of each amendment and
supplement thereto (in each case including any documents
incorporated therein by reference and all exhibits) and (iii) such
12
reasonable number of copies of the Prospectus included in such
Registration Statement (including each preliminary Prospectus) and
each amendment and supplement thereto, and such reasonable number of
copies of the final Prospectus as filed by the Company pursuant to
Rule 424(b) under the Securities Act, in conformity with the
requirements of the Securities Act and each amendment and supplement
thereto. The Company hereby consents to the use of the Prospectus by
each of the selling Holders of Registrable Notes 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 Notes covered by, or
the sale by Participating Broker-Dealers of the Exchange Notes
pursuant to, such Prospectus and any amendment thereto.
(e) If (1) a Shelf Registration is filed pursuant to Section 3, or (2) a
Prospectus contained in an Exchange Registration Statement filed
pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period relating thereto, the
Company shall notify in writing the selling Holders of Registrable
Notes, or each such Participating Broker-Dealer, as the case may be,
their counsel and the managing underwriters, if any, promptly (but
in any event within 2 Business Days) (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 (including in such
notice a written statement that any Holder may, upon request,
obtain, without charge, 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 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 Notes the
representations and warranties of the Company contained in any
agreement (including any underwriting agreement) contemplated by
Section 6(n) hereof cease to be true and correct, (iv) of the
receipt by the Company of any notification with respect to the
suspension of the qualification or exemption from qualification of a
Registration Statement or any of the Registrable Notes or the
Exchange Notes to be sold by any Participating Broker-Dealer for
offer or sale in any jurisdiction, or the initiation or threatening
of any proceeding for such purpose, (v) of the happening of any
event, the existence of any condition of 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 and 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 light of the
circumstances under which they were made, not misleading
13
and (vi) of any reasonable determination by the Company that a
post-effective amendment to a Registration Statement would be
appropriate.
(f) Use its reasonable 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 Notes or the Exchange Notes to be sold by any
Participating Broker-Dealer, for sale in any jurisdiction, and, if
any such order is issued, to use its reasonable best efforts to
obtain the withdrawal of any such order at the earliest possible
date.
(g) If (A) a Shelf Registration is filed pursuant to Section 3 or (B) a
Prospectus contained in an Exchange Registration Statement filed
pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period or (C) reasonably
requested in writing by the managing underwriters, if any, or the
Holders of a majority in aggregate principal amount of the
Registrable Notes being sold in connection with an underwritten
offering, (i) promptly incorporate in a Prospectus supplement or
post-effective amendment such information or revisions to
information therein relating to such underwriters or selling Holders
as the managing underwriters, if any, or such Holders or their
counsel reasonably request in writing to be included or made therein
and (ii) make all required filings of such Prospectus supplement or
such post-effective amendment as soon as practicable after the
Company has received notification of the matters to be incorporated
in such Prospectus supplements or post-effective amendment.
(h) Prior to any public offering of Registrable Notes or any delivery of
a Prospectus contained in the Exchange Registration Statement by any
Participating Broker-Dealer who seeks to sell Exchange Notes during
the Applicable Period, use its reasonable best efforts to register
or qualify, and to cooperate with the selling Holders of Registrable
Notes or each such Participating Broker-Dealer, as the case may be,
the underwriters, if any, and their respective counsel in connection
with the registration or qualification (or exemption from such
registration or qualification) of such Registrable Notes or Exchange
Notes, as the case may be, 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 any managing
underwriter or underwriters, if any, reasonably request in writing;
provided that where Exchange Notes held by Participating
Broker-Dealers or Registrable Notes are offered other than through
an underwritten offering, the Company agrees to cause its counsel to
perform Blue Sky investigations and file any registrations and
qualifications required to be filed pursuant to this Section 6(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 reasonably necessary or advisable to enable the disposition
in such jurisdictions of the Exchange Notes held by Participating
Broker-Dealers or the Registrable Notes covered by the applicable
Registration Statement; provided that neither the Company nor any
existing
14
Guarantor shall 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) a Shelf Registration is filed pursuant to Section 3 or (B) a
Prospectus contained in an Exchange Registration Statement filed
pursuant to Section 2 is requested to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period, cooperate with the
selling Holders of Registrable Notes and the managing underwriter or
underwriters, if any, to facilitate the timely preparation and
delivery of certificates representing Registrable Notes 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 Notes to be in such denominations and
registered in such names as the managing underwriter or
underwriters, if any, or Holders may reasonably request in writing.
(j) Use its reasonable best efforts to cause the Registrable Notes
covered by any Registration Statement to be registered with or
approved by such governmental agencies or authorities as may be
necessary to enable the seller or sellers thereof or the
underwriter, if any, to consummate the disposition of such
Registrable Notes, except as may be required solely as a consequence
of the nature of such selling Holder's business, in which case the
Company will cooperate in all reasonable respects with the filing of
such Registration Statement and the granting of such approvals;
provided that neither the Company nor any existing Guarantor shall
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
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, or (2) a
Prospectus contained in an Exchange Registration Statement filed
pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period, upon the occurrence of
any event contemplated by paragraph 6(e)(v) or 6(e)(vi) hereof, as
promptly as practicable, prepare and file with the SEC, at the
expense of the Company, 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 Notes
being sold thereunder or to the purchasers of the Exchange Notes to
whom such Prospectus will be delivered by a Participating
Broker-Dealer, 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 light
of the circumstances under which they were made, not misleading.
15
(l) Use its reasonable best efforts to cause the Registrable Notes
covered by a Registration Statement to be rated with such
appropriate rating agencies, if so requested in writing by the
Holders of a majority in aggregate principal amount of the
Registrable Notes covered by such Registration Statement or the
managing underwriter or underwriters, if any.
(m) Prior to the initial issuance of the Exchange Notes, (i) provide the
Trustee with one or more certificates for the Registrable Notes in a
form eligible for deposit with The Depository Trust Company and (ii)
provide a CUSIP number for the Exchange Notes.
(n) If a Shelf Registration is filed pursuant to Section 3, enter into
such agreements (including an underwriting agreement in form, scope
and substance as is customary in underwritten offerings of debt
securities similar to the Notes, as may be appropriate in the
circumstances) and take all such other actions in connection
therewith (including those reasonably requested in writing by the
managing underwriters, if any, or the Holders of a majority in
aggregate principal amount of the Registrable Notes being sold) in
order to expedite or facilitate the registration or the disposition
of such Registrable Notes, and in such connection, whether or not an
underwriting agreement is entered into and whether or not the
registration is an Underwritten Registration, (i) make such
representations and warranties to the Holders and the underwriters,
if any, with respect to the business of the Company and its
subsidiaries as then conducted, and the Registration Statement,
Prospectus and documents, if any, incorporated or deemed to be
incorporated by reference therein, in each case, in form, substance
and scope as are customarily made by issuers to underwriters in
underwritten offerings of debt securities similar to the Notes, as
may be appropriate in the circumstances, and confirm the same if and
when reasonably required; (ii) obtain an opinion of counsel to the
Company and updates thereof (which counsel and opinions (in form,
scope and substance) shall be reasonably satisfactory to the
managing underwriters, if any, and the Holders of a majority in
aggregate principal amount of the Registrable Notes being sold),
addressed to each selling Holder and each of the underwriters, if
any, covering the matters customarily covered in opinions of counsel
to the Company requested in underwritten offerings of debt
securities similar to the Notes, as may be appropriate in the
circumstances; (iii) obtain "cold comfort" letters and updates
thereof (which letters and updates (in form, scope and substance)
shall be reasonably satisfactory to the managing underwriters) from
the independent certified public accountants of the Company (and, if
necessary, any other independent certified public accountants of any
subsidiary of the Company or of any business acquired by the Company
for which financial statements and financial data are, or are
required to be, included in 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 Notes, as may be appropriate in the
circumstances, and such other matters as reasonably requested in
writing by the underwriters; and (iv) deliver such documents and
certificates as may be reasonably requested in writing by the
Holders of a
16
majority in aggregate principal amount of the Registrable Notes
being sold and the managing underwriters, if any, to evidence the
continued validity of the representations and warranties of the
Company and its subsidiaries made pursuant to clause (i) above and
to evidence compliance with any conditions contained in the
underwriting agreement or other similar agreement entered into by
the Company.
(o) If (1) a Shelf Registration is filed pursuant to Section 3, or (2) a
Prospectus contained in an Exchange Registration Statement filed
pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period, make available for
inspection by any selling Holder of such Registrable Notes being
sold, or each such Participating Broker-Dealer, as the case may be,
any underwriter participating in any such disposition of Registrable
Notes, if any, and any attorney, accountant or other agent retained
by any such selling Holder or each such Participating Broker-Dealer,
as the case may be, or underwriter (collectively, the "Inspectors"),
at the offices where normally kept, during reasonable business
hours, all financial and other records and pertinent corporate
documents of the Company and its subsidiaries (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 Company and its
subsidiaries to supply all information reasonably requested in
writing by any such Inspector in connection with such Registration
Statement. Each Inspector shall agree in writing that it will keep
the Records confidential and not disclose any of the Records unless
(i) the disclosure of such Records is necessary to avoid or correct
a misstatement or omission in such Registration Statement, (ii) the
release of such Records is ordered pursuant to a subpoena or other
order from a court of competent jurisdiction, (iii) the information
in such Records is public or has been made generally available to
the public other than as a result of a disclosure or failure to
safeguard by such Inspector or (iv) disclosure of such information
is, in the reasonable written opinion of counsel for any Inspector,
necessary or advisable in connection with any action, claim, suit or
proceeding, directly or indirectly, involving or potentially
involving such Inspector and arising out of, based upon, related to,
or involving this Agreement, or any transaction contemplated hereby
or arising hereunder. Each selling Holder of such Registrable Notes
and each such Participating Broker-Dealer will be required to agree
that information obtained by it as a result of such inspections
shall be deemed confidential and shall not be used by it as the
basis for any market transactions in the securities of the Company
unless and until such is made generally available to the public.
Each Inspector, each selling Holder of such Registrable Notes and
each such Participating Broker-Dealer will be required to further
agree that it will, upon learning that disclosure of such Records is
sought in a court of competent jurisdiction, give notice to the
Company and, to the extent practicable, use its best efforts to
allow the Company, at its expense, to undertake appropriate action
to prevent disclosure of the Records deemed confidential at its
expense.
17
(p) Comply with all applicable rules and regulations of the SEC and make
generally available to the security holders of the Company with
regard to any applicable Registration Statement earning statements
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) (i) commencing at the end of any fiscal
quarter in which Registrable Notes 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 Company after the
effective date of a Registration Statement, which statements shall
cover said 12-month periods.
(q) Upon consummation of an Exchange Offer or Private Exchange, obtain
an opinion of counsel to the Company (in form, scope and substance
reasonably satisfactory to the Initial Purchaser), addressed to the
Trustee for the benefit of all Holders participating in the Exchange
Offer or Private Exchange, as the case may be, to the effect that
(i) the Company and the existing Guarantors have duly authorized,
executed and delivered the Exchange Notes or the Private Exchange
Notes, as the case may be, and the Indenture, (ii) the Exchange
Notes or the Private Exchange Notes, as the case may be, and the
Indenture constitute legal, valid and binding obligations of the
Company and the existing Guarantors, enforceable against the Company
and the existing Guarantors in accordance with their respective
terms, except as such enforcement may be subject to customary United
States and foreign exceptions and (iii) all obligations of the
Company and the existing Guarantors under the Exchange Notes or the
Private Exchange Notes, as the case may be, and the Indenture are
secured to the same extent as the Notes.
(r) If the Exchange Offer or a Private Exchange is to be consummated,
upon delivery of the Registrable Notes by the Holders to the Company
(or to such other Person as directed by the Company) in exchange for
the Exchange Notes or the Private Exchange Notes, as the case may
be, the Company shall xxxx, or caused to be marked, on such
Registrable Notes that the Exchange Notes or the Private Exchange
Notes, as the case may be, are being issued as substitute evidence
of the indebtedness originally evidenced by the Registrable Notes;
provided that in no event shall such Registrable Notes be marked as
paid or otherwise satisfied.
(s) Cooperate with each seller of Registrable Notes covered by any
Registration Statement and each underwriter, if any, participating
in the disposition of such Registrable Notes and their respective
counsel in connection with any filings required to be made with the
NASD.
(t) Use its reasonable best efforts to take all other steps reasonably
necessary to effect the registration of the Registrable Notes
covered by a Registration Statement contemplated hereby.
18
(u) The Company may require each seller of Registrable Notes or
Participating Broker-Dealer as to which any registration is being
effected to furnish to the Company such information regarding such
seller or Participating Broker-Dealer and the distribution of such
Registrable Notes as the Company may, from time to time, reasonably
request in writing. The Company may exclude from such registration
the Registrable Notes of any seller who fails to furnish such
information within a reasonable time (which time in no event shall
exceed 45 days) after receiving such request. Each seller of
Registrable Notes or Participating Broker-Dealer as to which any
registration is being effected agrees to furnish promptly to the
Company all information required to be disclosed in order to make
the information previously furnished by such seller not materially
misleading.
(v) Each Holder of Registrable Notes and each Participating
Broker-Dealer agrees by acquisition of such Registrable Notes or
Exchange Notes to be sold by such Participating Broker-Dealer, as
the case may be, that, upon receipt of any notice from the Company
of the happening of any event of the kind described in Section
6(e)(ii), 6(e)(iv), 6(e)(v), or 6(e)(vi), such Holder will forthwith
discontinue disposition of such Registrable Notes covered by a
Registration Statement and such Participating Broker-Dealer will
forthwith discontinue disposition of such Exchange Notes pursuant to
any Prospectus and, in each case, forthwith discontinue
dissemination of such Prospectus until such Holder's or
Participating Broker-Dealer's receipt of the copies of the
supplemented or amended Prospectus contemplated by Section 6(k), or
until it is advised in writing (the "Advice") by the Company that
the use of the applicable Prospectus may be resumed, and has
received copies of any amendments or supplements thereto and, if so
directed by the Company, such Holder or Participating Broker-Dealer,
as the case may be, will deliver to the Company all copies, other
than permanent file copies, then in such Holder's or Participating
Broker-Dealer's possession, of the Prospectus covering such
Registrable Notes current at the time of the receipt of such notice.
In the event the Company shall give any such notice, the Applicable
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 Participating Broker-Dealer shall have
received (x) the copies of the supplemented or amended Prospectus
contemplated by Section 6(k) or (y) the Advice.
7. REGISTRATION EXPENSES
(a) All fees and expenses incident to the performance of or compliance
with this Agreement by the Company shall be borne by the Company,
whether or not the Exchange Offer or a Shelf Registration is filed
or becomes effective, 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 any underwritten offering and (B) fees and expenses
of compliance with state securities or Blue Sky laws as provided in
Section 6(h) hereof, (ii) printing expenses, including, without
limitation, expenses of printing Prospectuses if the printing of
Prospectuses is requested by the managing underwriter or
19
underwriters, if any, or by the Holders of a majority in aggregate
principal amount of the Registrable Notes included in any
Registration Statement or by any Participating Broker-Dealer during
the Applicable Period, as the case may be, (iii) messenger,
telephone and delivery expenses incurred in connection with the
performance of their obligations hereunder, (iv) fees and
disbursements of counsel for the Company, (v) fees and disbursements
of all independent certified public accountants referred to in
Section 6 (including, without limitation, the expenses of any
special audit and "cold comfort" letters required by or incident to
such performance), (vi) rating agency fees, (vii) Securities Act
liability insurance, if the Company desires such insurance, (viii)
fees and expenses of all other Persons retained by the Company, (ix)
internal expenses of the Company (including, without limitation, all
salaries and expenses of officers and employees of the Company
performing legal or accounting duties), (x) the expense of any
annual audit, (xi) the fees and expenses of the Trustee and the
Exchange Agent and (xii) the expenses relating to printing, word
processing and distributing all Registration Statements,
underwriting agreements, securities sales agreements, indentures and
any other documents necessary in order to comply with this Agreement
(other than underwriting discounts and commissions).
(b) The Company shall reimburse the Holders for the reasonable fees and
disbursements of not more than one counsel chosen by the Holders of
a majority in aggregate principal amount of the Registrable Notes to
be included in any Registration Statement. The Company shall pay all
documentary, stamp, transfer or other transactional taxes
attributable to the issuance or delivery of the Exchange Notes or
Private Exchange Notes in exchange for the Notes; provided that the
Company shall not be required to pay taxes payable in respect of any
transfer involved in the issuance or delivery of any Exchange Note
or Private Exchange Note in a name other than that of the Holder of
the Note in respect of which such Exchange Note or Private Exchange
Note is being issued. The Company shall reimburse the Holders for
fees and expenses (including reasonable fees and expenses of counsel
to the Holders) relating to any enforcement of any rights of the
Holders under this Agreement.
8. INDEMNIFICATION
(a) Indemnification by the Company. The Company and the Guarantors
jointly and severally agree to indemnify and hold harmless each
Holder of Registrable Notes, Exchange Notes or Private Exchange
Notes and each Participating Broker-Dealer selling Exchange Notes
during the Applicable Period, each Person, if any, who controls each
such Holder (within the meaning of Section 15 of the Securities Act
or Section 20(a) of the Exchange Act) and the officers, directors
and partners of each such Holder, Participating Broker-Dealer and
controlling person from and against any losses, claims, damages,
liabilities, costs (including, without limitation, reasonable costs
of preparation and reasonable attorneys' fees as provided in this
Section 8) and expenses (including, without limitation, reasonable
costs and expenses incurred in connection with investigating,
preparing, pursuing or defending against any of the foregoing)
(collectively, "Losses"), insofar as
20
such Losses arise out of or are based upon any untrue statement or
alleged untrue statement of a material fact in any Registration
Statement, Prospectus or form of prospectus, or in any amendment or
supplement thereto, or in any preliminary prospectus, or any
omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they were made,
not misleading, except insofar as such Losses result primarily from
information relating to such Holder or Participating Broker-Dealer
and furnished in writing to the Company (or reviewed and approved in
writing) by such Holder or Participating Broker-Dealer or their
counsel expressly for use therein; provided, however, that the
Company and the Guarantors will not be liable to any Indemnified
Party (as defined below) under this Section 8 to the extent Losses
resulted primarily from an untrue statement or omission or alleged
untrue statement or omission that was contained or made in any
preliminary prospectus and corrected in the Prospectus or any
amendment or supplement thereto if (i) any such Losses resulted from
an action, claim or suit by any Person who purchased Registrable
Notes or Exchange Notes which are the subject thereof from such
Indemnified Party and (ii) it is established in the related
proceeding that such Indemnified Party 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
Notes 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 Company with Section 6 of this Agreement. The
Company and the Guarantors also agree to indemnify underwriters,
selling brokers, dealer managers and similar securities industry
professionals participating in the distribution, their officers,
directors, agents and employees and each Person who controls such
Persons (within the meaning of Section 15 of the Securities Act or
Section 20(a) of the Exchange Act) to the same extent as provided
above with respect to the indemnification of the Holders or the
Participating Broker-Dealer.
(b) Indemnification by Holder. Each Holder shall indemnify and hold
harmless the Company, the Guarantors, their respective directors and
each Person, if any, who controls the Company (within the meaning of
Section 15 of the Securities Act and Section 20(a) of the Exchange
Act), and the directors, officers and partners of such controlling
persons, from and against all Losses insofar as such Losses arise
out of or are based upon any untrue statement or alleged untrue
statement of a material fact in any Registration Statement,
Prospectus or form of prospectus or in any amendment or supplement
thereto or in any preliminary prospectus, or any omission or alleged
omission to state therein 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 insofar
as such Losses are finally judicially determined by a court of
competent jurisdiction to have resulted primarily from any untrue
statement or alleged untrue statement of any material fact, alleged
omission of any material fact contained in or omitted from any
information so furnished in writing by such Holder to the Company
expressly for use therein. Notwithstanding the foregoing, in no
event shall the liability of any selling Holder be greater in amount
than the dollar amount of the
21
proceeds (net of payment of all expenses) received by such Holder
upon the sale of the Registrable Notes giving rise to such
indemnification obligation.
(c) Conduct of Indemnification Proceedings. If any proceeding shall be
brought or asserted against any Person entitled to indemnity
hereunder (an "Indemnified Party"), such Indemnified Party shall
promptly notify the party or parties from which such indemnity is
sought (the "Indemnifying Party" or "Indemnifying Parties", as
applicable) in writing; provided, that the failure to so notify the
Indemnifying Parties shall not relieve the Indemnifying Parties from
any obligation or liability except to the extent (but only to the
extent) that it shall be finally determined by a court of competent
jurisdiction (which determination is not subject to appeal) that the
Indemnifying Parties have been prejudiced materially by such
failure.
The Indemnifying Party shall have the right, exercisable by giving written
notice to an Indemnified Party, within 20 Business Days after receipt of written
notice from such Indemnified Party of such proceeding, to assume, at its
expense, the defense of any such proceeding, provided, that an Indemnified Party
shall have the right to employ separate counsel in any such proceeding and to
participate in the defense thereof, but the fees and expenses of such counsel
shall be at the expense of such Indemnified Party or parties unless: (1) the
Indemnifying Party has agreed to pay such fees and expenses; or (2) the
Indemnifying Party shall have failed promptly to assume the defense of such
proceeding or shall have failed to employ counsel reasonably satisfactory to
such Indemnified Party; or (3) the named parties to any such proceeding
(including any impleaded parties) include both such Indemnified Party and the
Indemnifying Party or any of its affiliates or controlling persons, and such
Indemnified Party shall have been advised by counsel that there may be one or
more defenses available to such Indemnified Party that are in addition to, or in
conflict with, those defenses available to the Indemnifying Party or such
affiliate or controlling person (in which case, if such Indemnified Party
notifies the Indemnifying Parties in writing that it elects to employ separate
counsel at the expense of the Indemnifying Parties, the Indemnifying Parties
shall not have the right to assume the defense and the reasonable fees and
expenses of such counsel shall be at the expense of the Indemnifying Party; it
being understood, however, that, the Indemnifying Party shall not, in connection
with any one such proceeding or separate but substantially similar or related
proceedings in the same jurisdiction, arising out of the same general
allegations or circumstances, be liable for the fees and expenses of more than
one separate firm of attorneys (together with appropriate local counsel) at any
time for such Indemnified Party).
No Indemnifying Party shall be liable for any settlement of any such
proceeding effected without its written consent, which shall not be unreasonably
withheld, but if settled with its written consent, or if there be a final
judgment for the plaintiff in any such proceeding, each Indemnifying Party
jointly and severally agrees, subject to the exceptions and limitations set
forth above, to indemnify and hold harmless each Indemnified Party from and
against any and all Losses by reason of such settlement or judgment. The
Indemnifying Party shall not consent to the entry of any judgment or enter into
any settlement that does not include as an unconditional term thereof the giving
by the claimant or plaintiff to each Indemnified Party of a release, in form and
substance reasonably satisfactory to the Indemnified Party, from all liability
in respect
22
of such proceeding for which such Indemnified Party would be entitled to
indemnification hereunder (whether or not any Indemnified Party is a party
thereto).
(d) Contribution. If the indemnification provided for in this Section 8
is unavailable to an Indemnified Party or is insufficient to hold
such Indemnified Party harmless for any Losses in respect of which
this Section 8 would otherwise apply by its terms (other than by
reason of exceptions provided in this Section 8), then each
applicable Indemnifying Party, in lieu of indemnifying such
Indemnified Party, shall have a joint and several obligation to
contribute to the amount paid or payable by such Indemnified Party
as a result of such Losses, in such proportion as is appropriate to
reflect the relative fault of the Indemnifying Party, on the one
hand, and such Indemnified Party, on the other hand, in connection
with the actions, statements or omissions that resulted in such
Losses as well as any other relevant equitable considerations. The
relative fault of such Indemnifying Party, on the one hand, and
Indemnified Party, on the other hand, shall be determined by
reference to, among other things, whether any untrue or alleged
untrue statement of a material fact or omission or alleged omission
to state a material fact relates to information supplied by such
Indemnifying Party or Indemnified Party, and the parties' relative
intent, knowledge, access to information and opportunity to correct
or prevent any such statement or omission. The amount paid or
payable by an Indemnified Party as a result of any Losses shall be
deemed to include any legal or other fees or expenses incurred by
such party in connection with any proceeding, to the extent such
party would have been indemnified for such fees or expenses if the
indemnification provided for in Section 8(a) or 8(b) was available
to such party.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 8(d) were determined by pro rata
allocation or by other method of allocation that does not take account of the
equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 8(d), a selling Holder shall not
be required to contribute, in the aggregate, any amount in excess of such
Holder's Maximum Contribution Amount. A selling Holder's "Maximum Contribution
Amount" shall equal the excess of (i) the aggregate proceeds received by such
Holder pursuant to the sale of such Registrable Notes or Exchange Notes over
(ii) the aggregate amount of damages that such Holder has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any Person who was not guilty of such fraudulent
misrepresentation.
The indemnity and contribution agreements contained in this Section 8 are
in addition to any liability that the Indemnifying Parties may have to the
Indemnified Parties.
9. RULES 144 AND 144A
The Company covenants that it shall file the reports required to be filed
by it (if so required) under the Securities Act and the Exchange Act in a timely
manner and, if at any time the Company is not required to file such reports, it
will, upon the written request of any Holder
23
of Registrable Notes, make publicly available other information necessary to
permit sales pursuant to Rule 144 and 144A. Upon the request of any Holder, the
Company shall deliver to such Holder a written statement as to whether it has
complied with such information and requirements.
10. UNDERWRITTEN REGISTRATIONS OF REGISTRABLE NOTES
If any of the Registrable Notes 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 Notes
included in such offering; provided, however, that such investment banker or
investment bankers and manager or managers must be reasonably acceptable to the
Company.
No Holder of Registrable Notes may participate in any underwritten
registration hereunder unless such Holder (a) agrees to sell such Holder's
Registrable Notes 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.
11. MISCELLANEOUS
(a) No Inconsistent Agreements. The Company has not entered, as of the
date hereof, and the Company shall not enter, after the date of this
Agreement, into any agreement with respect to any of its securities
that is inconsistent with the rights granted to the Holders of
Securities in this Agreement or otherwise conflicts with the
provisions hereof. The Company has not entered and will not enter
into any agreement with respect to any of its securities that will
grant to any Person piggy-back rights with respect to a Registration
Statement.
(b) Adjustments Affecting Registrable Notes. The Company shall not,
directly or indirectly, take any action with respect to the
Registrable Notes as a class that would adversely affect the ability
of the Holders to include such Registrable Notes 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 the Holders of not less than
a majority in aggregate principal amount of the then outstanding
Registrable Notes in circumstances that would adversely affect any
Holders of Registrable Notes; provided, however, that Section 8 and
this Section 11(c) may not be amended, modified or supplemented
without the prior written consent of each Holder. 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 Notes whose securities are being
tendered pursuant to the Exchange Offer or sold pursuant to a Notes
24
Registration Statement and that does not directly or indirectly
affect, impair, limit or compromise the rights of other Holders of
Registrable Notes may be given by Holders of at least a majority in
aggregate principal amount of the Registrable Notes being tendered
or being sold by such Holders pursuant to such Notes Registration
Statement.
(d) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand delivery,
registered first-class mail, next-day air courier or telecopier:
(i) if to a Holder of Securities or to 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 of the Notes, with a copy in like
manner to the Initial Purchaser as follows:
Xxxxxxxxx & Company, Inc.
00000 Xxxxx Xxxxxx Xxxxxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Facsimile No.: (000) 000-0000
Attention: Xxxxx X. Xxxxx, Esq.
with a copy to:
Mayer, Brown, Xxxx & Maw
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No.: (000) 000-0000
Attention: Xxxxxx X. Xxxxx, Esq.
(ii) if to the Initial Purchaser, at the address specified in
Section 12(d)(1);
(iii) if to the Company, as follows:
Golfsmith International, Inc.
00000 X. XX-00
Xxxxxx, XX, 00000-0000
Attention: Chief Executive Officer
with a copy to:
King & Spalding
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx X. Xxxxxxx, Esq.
25
All such notices and communications shall be deemed to have been duly
given: when delivered by hand, if personally delivered; three business days
after being deposited in the United States mail, postage prepaid, if mailed; one
business day after being timely delivered to a next-day air courier guaranteeing
overnight delivery; and when receipt is acknowledged by the addressee, if
telecopied.
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee under the
Indenture at the address 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, including, without limitation and without the need
for an express assignment, subsequent Holders of 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 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 WITHOUT REGARD TO
PRINCIPLES OF CONFLICT OF LAW. THE COMPANY HEREBY IRREVOCABLY
SUBMITS TO THE JURISDICTION OF ANY NEW YORK STATE COURT SITTING IN
THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK OR ANY FEDERAL
COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN
RESPECT OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING
TO THIS AGREEMENT, AND IRREVOCABLY ACCEPTS FOR ITS AND IN RESPECT OF
ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, JURISDICTION OF THE
AFORESAID COURTS. THE COMPANY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT IT MAY EFFECTIVELY DO SO UNDER APPLICABLE LAW, TRIAL BY JURY
AND ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF
VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH
COURT AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT
IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. THE
COMPANY IRREVOCABLY CONSENTS, TO THE FULLEST EXTENT IT MAY
EFFECTIVELY DO SO UNDER APPLICABLE LAW, TO THE SERVICE OF PROCESS OF
ANY OF THE AFOREMENTIONED COURTS IN ANY SUCH ACTION OR PROCEEDING BY
THE MAILING OF COPIES THEREOF BY REGISTERED OR CERTIFIED MAIL,
POSTAGE PREPAID, TO THE COMPANY AT ITS
26
SAID ADDRESS, SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS AFTER SUCH
MAILING. NOTHING HEREIN SHALL AFFECT THE RIGHT OF ANY HOLDER TO
SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE
LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST THE COMPANY IN ANY
OTHER JURISDICTION.
(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 Company or Its Affiliates. Whenever the
consent or approval of Holders of a specified percentage of
Securities is required hereunder, Securities held by the Company 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 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, the Indenture and the Collateral Agreements, 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,
understanding, correspondence, conversations and memoranda between
the Initial Purchaser on the one hand and the Company 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.
27
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, all as of the date first written above.
GOLFSMITH INTERNATIONAL, INC.
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
GOLFSMITH INTERNATIONAL HOLDINGS,
INC., as Guarantor
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
GOLFSMITH GP HOLDINGS, INC., as Subsidiary
Guarantor
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
GOLFSMITH HOLDINGS, L.P., as Subsidiary
Guarantor
By: Golfsmith GP Holdings, Inc., as General
Partner
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
REGISTRATION RIGHTS AGREEMENT
28
GOLFSMITH GP, L.L.C., as Subsidiary Guarantor
By: Golfsmith Holdings, L.P., as Sole Member
By: Golfsmith GP Holdings, Inc., as General
Partner
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
GOLFSMITH DELAWARE, L.L.C., as Subsidiary
Guarantor
By: Golfsmith Holdings, L.P., as Sole Member
By: Golfsmith GP Holdings, Inc., as General
Partner
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
GOLFSMITH CANADA, L.L.C., as Subsidiary
Guarantor
By: Golfsmith Holdings, L.P., as Sole Member
By: Golfsmith GP Holdings, Inc., as General
Partner
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
REGISTRATION RIGHTS AGREEMENT
29
GOLFSMITH EUROPE, L.L.C., as Subsidiary
Guarantor
By: Golfsmith Holdings, L.P., as Sole Member
By: Golfsmith GP Holdings, Inc., as General
Partner
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
GOLFSMITH USA, L.L.C., as Subsidiary
Guarantor
By: Golfsmith Holdings, L.P., as Sole Member
By: Golfsmith GP Holdings, Inc., as General
Partner
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
GOLFSMITH NU, L.L.C., as Subsidiary
Guarantor
By: Golfsmith Holdings, L.P., as Sole Member
By: Golfsmith GP Holdings, Inc., as General
Partner
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
REGISTRATION RIGHTS AGREEMENT
30
GOLFSMITH LICENSING, L.L.C., as Subsidiary
Guarantor
By: Golfsmith Holdings, L.P., as Sole Member
By: Golfsmith GP Holdings, Inc., as General
Partner
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
GOLFSMITH INTERNATIONAL, L.P., as Subsidiary
Guarantor
By: Golfsmith GP, L.L.C., as General Partner
By: Golfsmith Holdings, L.P., as Sole Member
By: Golfsmith GP Holdings, Inc., as General
Partner
By: /s/ XXXX X. XXXXXX
---------------------------------------
Name: Xxxx X. Xxxxxx
Title: Vice President
REGISTRATION RIGHTS AGREEMENT
31
ACCEPTED AND AGREED TO:
JEFFERIES & COMPANIES, INC.
By: /s/ M. XXXXX XXXXXXX
---------------------------------
Name: M. Xxxxx Xxxxxxx
Title: Executive Vice President
REGISTRATION RIGHTS AGREEMENT
32
