Exhibit II
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "Agreement") is entered into as
of September 10, 2003 by and between CONSECO, INC., a Delaware corporation
(the "Issuer"), and the holders of common stock of the Issuer named on the
signature pages hereto; which holders shall be limited to (i) holders of 5%
or more of such class of the Issuer's securities as of the Effective Date,
(ii) other holders who have notified the Issuer in writing that they are
members of a "group" (as such term is defined for purposes of the Exchange
Act) of holders owning 5% or more of such class of the Issuer's securities as
of the Effective Date and (iii) other holders who have notified the Issuer in
writing that they are "underwriters" (as such term is defined in Section 1145
of the Bankruptcy Code (as defined below)) (the "Initial Holders").
WHEREAS, concurrently herewith the Issuer is consummating the issuance
of Conseco, Inc. common stock, par value $.01 per share (the "Common Stock"),
pursuant to a reorganization plan (the "Plan") under chapter 11 of title 11
of the United States Code (the "Bankruptcy Code");
WHEREAS, the Initial Holders will be holders of Common Stock of the
Issuer following the confirmation of the Plan;
WHEREAS, the parties hereto wish to enter into this Agreement in order
to provide for certain arrangements concerning their relationship following
the issuance of the Common Stock;
NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 Defined Terms. As used herein the following terms shall have
the following meanings:
"Affiliate" of any Person means any other Person directly or indirectly
controlling or controlled by or under common control with such Person. For
the purposes of this definition, "control" when used with respect to any
Person, means the possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of such Person, whether
through the ownership of voting securities, by contract or otherwise; and the
terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Agreement" has the meaning set forth in the Preamble hereto.
"Appaloosa" means Appaloosa Management, L.P. and its Affiliates.
"Commission" means the United States Securities and Exchange Commission.
"Common Stock" has the meaning set forth in the Preamble hereto.
"Demand Registration" means a Demand Registration as defined in Section
2.2.
"Effective Date" means the date the Plan becomes effective under the
Bankruptcy Code.
"Exchange Act" means the United States Securities Exchange Act of 1934,
as amended.
"Holder" shall mean any Initial Holder who holds Registrable Securities
or any assignee or transferee of a Registrable Security unless such
Registrable Security is acquired in a public distribution pursuant to a
registration statement under the Securities Act or pursuant to a transaction
exempt from registration under the Securities Act where securities sold in
such transaction may be resold without subsequent registration under the
Securities Act.
"Issuer" has the meaning set forth in the Preamble hereto.
"Person" means any individual, corporation, partnership, trust, limited
liability company, government or governmental agency.
"Piggy-Back Registration" means a Piggy-Back Registration as defined in
Section 2.3.
"Preferred Registration Rights Agreement" means that certain
Registration Rights Agreement dated as of even date herewith by and between
the Issuer and certain holders of Preferred Stock.
"Preferred Stock" means the Preferred Stock, par value $.01, of the
Issuer.
The terms "register", "registered" and "registration" shall refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act and applicable rules and regulations
thereunder, and the declaration or ordering of the effectiveness of such
registration statement.
"Registrable Securities" means (i) the Common Stock, (ii) any shares of
Common Stock issued upon conversion or exchange of any securities held by the
Initial Holders convertible or exchangeable into Common Stock and (iii) any
other securities that may be issued or distributed in respect of such Common
Stock by way of any stock split, stock dividend, exchange or other
distribution, recapitalization, reclassification, merger, consolidation or
similar event. For the purposes of this Agreement, Registrable Securities of
any Holder will cease to be Registrable Securities when (a) a registration
statement covering such Registrable Securities has been declared effective
and such Registrable Securities have been sold pursuant to such effective
registration statement or (b) in the opinion of counsel for the Issuer the
sale of such Holder's Registrable Securities are not required to be
registered under the Securities Act.
"Securities" means the Common Stock.
"Securities Act" means the United States Securities Act of 1933, as
amended.
"Selling Holder" means a Holder who is selling Registrable Securities
pursuant to a registration statement under the Securities Act.
"Shelf Registration Statement" means a Shelf Registration Statement as
defined in Section 2.1.
"Underwriter" means a securities dealer who purchases any Registrable
Securities as principal and not as part of such dealer's market-making
activities.
ARTICLE II
REGISTRATION RIGHTS
SECTION 2.1 Shelf Registration.
(a) As expeditiously as practicable (but in no event after the later of
(i) 15 days after the date the Issuer is required to file its first annual
report on Form 10-K or quarterly report on Form 10-Q in each case including
fresh start financial statements, whichever comes first and (ii) 90 days
after the Effective Date), the Issuer shall file with the Commission a
registration statement (the "Shelf Registration Statement") relating to the
offer and sale of Registrable Securities by the Holders to the public, from
time to time, on a delayed or continuous basis (but not involving any
underwriting). The Issuer shall use its reasonable best efforts to cause the
Shelf Registration Statement to be declared effective by the Commission as
soon as practicable thereafter.
(b) The Issuer agrees to use its reasonable best efforts to keep the
Shelf Registration Statement continuously effective and not to suspend use of
the prospectus included therein in order to permit the prospectus included
therein to be usable by the Holders until the earlier of: (1) the date all
Holders could sell shares free of any volume limitations imposed by Rule 144
of the Securities Act; (2) the date all Holders have disposed of all
Registrable Securities; or (3) three years from the date on which such Shelf
Registration Statement was declared effective; provided, that the Issuer
shall be deemed to have used its reasonable best efforts to keep the Shelf
Registration Statement effective during the requisite period if it
determines, in its reasonable judgment and upon the advice of counsel, as
authorized by a resolution of its Board of Directors, that the filing of such
Shelf Registration Statement or the maintenance of effectiveness of such
Shelf Registration Statement or prospectus included therein would materially
interfere with any material financing, corporate reorganization or other
material transaction involving the Issuer or any subsidiary, or would require
premature disclosure thereof, and the Issuer promptly gives the Holders
written notice of such determination, containing a general statement of the
reasons for such postponement or suspension and an approximation of the
anticipated delay; provided, however, that the failure to keep the Shelf
Registration Statement effective and usable for offers and sales of
Registrable Securities for such reasons shall last no longer than 120 days in
the aggregate in any 12-month period.
SECTION 2.2 Demand Registration.
(a) Commencing 30 days following the Effective Date, any Holder of
Registrable Securities may make a written request substantially in the form
of Annex A hereto for registration under the Securities Act of all or part
of its or their Registrable Securities (a "Demand Registration"); provided
that the Issuer shall not be obligated to effect (i) any Demand
Registration, except for the first Demand Registration hereunder, unless
the aggregate market value of the Registrable Securities covered by such
written requests (calculated as of a recent date as determined by the
Issuer) is at least $50,000,000, (ii) more than one Demand Registration in
any 6-month period, (iii) more than three Demand Registrations requested by
Appaloosa and more than two Demand Registrations requested by Holders other
than Appaloosa, (iv) any Demand Registration within 3 months of a previous
registration in which the holders of Registrable Securities were given
piggyback rights pursuant to Section 2.3 and in which there was no
reduction in the number of Registrable Securities requested to be included
or (v) any Demand Registration at a time when doing so would be in
violation of Section 5.3(b) of the Preferred Registration Rights Agreement.
Each such request will specify the number of Registrable Securities
proposed to be sold and will also specify the intended method of
disposition thereof and may specify the book-running managing Underwriter
and any additional investment bankers and managers to be used in connection
with an underwritten offering. Promptly after receipt of requests for the
registration of Registrable Securities with an aggregate market value of at
least $50,000,000 (determined as aforesaid) or, in the case of the first
Demand Registration hereunder, promptly after the receipt of a request for
the registration of Registrable Securities, the Issuer will give written
notice of such registration request to all other Holders of the Registrable
Securities and include in such registration all such Registrable Securities
with respect to which the Issuer has received a written request for
inclusion therein within 30 calendar days after written notice has been
mailed. Each such request will also specify the number of Registrable
Securities to be registered and the intended method of disposition thereof.
The registration statement to be filed pursuant to a Demand Registration
shall not include securities being sold for the account of other persons
and entities (other than securities being sold for the account of other
persons and entities pursuant to the piggy-back registration rights
provisions of the Preferred Registration Rights Agreement) or for the
account of the Issuer, unless the Holders of a majority of the Registrable
Securities to be included in such Demand Registration consent in writing
thereto.
(b) A registration will not count as a Demand Registration until it has
become effective and remains effective for not less than 90 days or such
shorter period as is required for all of the Registrable Securities so
registered to be sold unless such Demand Registration has not become
effective due solely to the fault of, or is terminated at the request of, the
requesting Holders.
(c) If the Holders of a majority of the Registrable Securities to be
registered in a Demand Registration so elect, the offering of such
Registrable Securities pursuant to such Demand Registration shall be in the
form of an underwritten offering. Unless otherwise specified by the Holders
of a majority of the Registrable Securities to be included in such Demand
Registration, and subject to the approval of such Holders, which shall not be
unreasonably withheld, the Issuer shall select the book-running managing
Underwriter in connection with such offering and any additional investment
bankers and managers to be used in connection with the offering. Any
book-running managing Underwriter or additional investment bankers and
managers specified by the Holders shall be subject to the approval of the
Issuer, which shall not be unreasonably withheld. To the extent 25% or more
of the Registrable Securities so requested to be registered are excluded from
the offering in accordance with Section 2.4, the registration of such
offering will not count as a Demand Registration.
SECTION 2.3 Piggy-Back Registration. If the Issuer proposes to file a
registration statement under the Securities Act with respect to an equity
offering by the Issuer for its own account or for the account of any of its
respective securityholders of any class of equity security (other than a
registration statement on Form S-4 or S-8 (or any substitute form that may be
adopted by the Commission) or a registration statement to be filed in
connection with an exchange offer or offering of securities solely to the
Issuer's existing securityholders), then the Issuer shall give written notice
of such proposed filing to the Holders of Registrable Securities as soon as
practicable (but in no event less than 30 calendar days before the
anticipated filing date), and such notice shall offer such Holders the
opportunity to register such number of shares of Registrable Securities as
each such Holder may request (a "Piggy-Back Registration"). The Issuer shall
use its reasonable best efforts to cause the managing Underwriter or
Underwriters of a proposed underwritten offering to permit the Registrable
Securities requested to be included in a Piggy-Back Registration to be
included on the same terms and conditions as any similar securities of the
Issuer included therein.
SECTION 2.4 Reduction of Offering. Notwithstanding anything to the
contrary contained herein, if the managing Underwriter or Underwriters of an
offering described in Section 2.2 or 2.3 shall advise the Issuer that, in its
judgment, either (a) the size of the offering that the Holders, the Issuer
and such other persons intend to make exceeds the size that can be sold in an
orderly manner in such offering within a price range acceptable to the
Holders, the Issuer or such other persons participating in the offering, or
(b) in the case of a Piggy-Back Registration, the type of securities proposed
to be offered in such registration statement by the Holders or such other
persons would materially adversely affect such offering, then in the case of
(a) above, the amount of securities to be offered for the accounts of Holders
shall be reduced pro rata (according to the Registrable Securities proposed
for registration), to the extent necessary to reduce the total amount of
securities to be included in such offering to the amount recommended by such
managing Underwriter or Underwriters; provided that, in the case of a
Piggy-Back Registration initiated for the account of the Issuer, the amount
of Registrable Securities being offered by Holders shall be reduced before
the amount of securities being offered by the Issuer is reduced but, subject
to (b) above, the proportion by which the amount of Registrable Securities
being offered by Holders is reduced shall not exceed the proportion by which
the amount of such securities intended to be offered by such other persons or
entities is reduced; provided further that, in the case of a Piggy-Back
Registration initiated for the account of other persons or entities, then the
amount of Registrable Securities being offered by Holders shall be reduced
before the amount of securities being offered by such other persons or
entities or the Issuer is reduced; and provided further that, in the case of
a Demand Registration, if securities are being offered for the account of
other persons or entities or for the account of the Issuer, then the amount
of such securities being offered by such other persons or entities or by the
Issuer shall be reduced before the amount of any Registrable Securities
intended to be offered by Holders is reduced; and in the case of (b) above,
the type of securities proposed to be offered in such registration statement
by Holders or such other persons shall not be included in such registration
statement.
ARTICLE III
REGISTRATION PROCEDURES
SECTION 3.1 Filings; Information. Whenever Holders validly request that
any Registrable Securities be registered pursuant to Section 2.2 hereof, the
Issuer will use its reasonable best efforts to effect the registration and
the sale of such Registrable Securities in accordance with the intended
method of disposition thereof as quickly as practicable, and in connection
with any such request:
(a) The Issuer will as expeditiously as practicable prepare and file
with the Commission a registration statement on any form for which the Issuer
then qualifies or which counsel for the Issuer shall deem appropriate and
which form shall be available for the sale of the Registrable Securities to
be registered thereunder in accordance with the intended method of
distribution thereof, and use its reasonable best efforts to cause such filed
registration statement to become and remain effective for a period of not
less than 90 days; provided that if the Issuer shall furnish to the Holders
making a request pursuant to Section 2.2 a resolution of its Board of
Directors stating that in their good faith judgment it would be
disadvantageous to the Issuer or its shareholders for such a registration
statement to be filed as expeditiously as practicable or that such
registration and offering would materially interfere with any material
financing, corporate reorganization or other material transaction involving
the Issuer or any of its subsidiaries, or would require premature disclosure
thereof, and promptly gives the Holders making such request written notice
that such determination has been made (a "Valid Business Reason"), the Issuer
shall have a period of not more than 180 days within which to file such
registration statement measured from the date the notice is sent to the
Holders in accordance with Section 2.2 or, in the case of a registration
statement that has been filed in connection with a Demand Registration, the
Issuer may cause such registration statement to be withdrawn and its
effectiveness terminated or may postpone amending or supplementing such
registration statement until such Valid Business Reason no longer exists.
(b) The Issuer will prepare and file with the Commission such amendments
and supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration statement
effective and to comply with the registration form utilized by the Issuer or
by the instructions applicable to such registration form or by the Securities
Act or the rules and regulations promulgated thereunder, until the earlier of
(i) such time as all of such Registrable Securities and other securities have
been disposed of in accordance with the intended methods of disposition or
otherwise by the Selling Holders set forth in such registration statement and
(ii) 90 days, in either case, after the initial effective date of such
registration statement.
(c) The Issuer will, prior to filing a registration statement or
prospectus or any amendment or supplement thereto, furnish copies of all
such documents to each Selling Holder and each Underwriter, if any, and
their respective counsel, which documents shall be subject to the review
and comment of such Selling Holder, Underwriter and counsel, and thereafter
furnish, without charge, to such Selling Holder and Underwriter, if any,
such number of copies of such registration statement, each amendment and
supplement thereto (in each case including all exhibits thereto and
documents incorporated by reference therein), the prospectus included in
such registration statement (including each preliminary prospectus) and
such other documents as such Selling Holder or Underwriter may reasonably
request in order to facilitate the disposition of the Registrable
Securities owned by such Selling Holder. The information contained in such
documents are confidential shall not be disclosed by such Selling Holder
unless (i) the disclosure of such information is necessary to avoid or
correct a misstatement or omission in such registration statement or (ii)
the release of such information is ordered pursuant to a subpoena or other
order from a court of competent jurisdiction. Each Selling Holder of such
Registrable Securities agrees 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 Issuer
or its Affiliates unless and until such information is made generally
available to the public. Each Selling Holder of such Registrable Securities
further agrees that it will, upon learning that disclosure of such
information is sought in a court of competent jurisdiction, give notice to
the Issuer and allow the Issuer, at its expense, to undertake appropriate
action to prevent disclosure of the information deemed confidential.
(d) After the filing of the registration statement, the Issuer will
promptly notify each Selling Holder of Registrable Securities covered by such
registration statement of any stop order issued or threatened by the
Commission and take all reasonable actions required to prevent the entry of
such stop order or to remove it if entered.
(e) The Issuer will use its reasonable best efforts to (i) register or
qualify the Registrable Securities under such other securities or blue sky
laws of such jurisdictions in the United States as any Selling Holder
reasonably (in the light of such Selling Holder's intended plan of
distribution) requests and (ii) cause such Registrable Securities to be
registered with or approved by such other federal and state governmental
agencies or authorities as may be necessary to enable the Selling Holders to
consummate the disposition of such Registrable Securities and do any and all
other acts and things that may be reasonably necessary or advisable to enable
such Selling Holder to consummate the disposition of the Registrable
Securities owned by such Selling Holder; provided that the Issuer will not be
required to (A) qualify generally to do business in any jurisdiction where it
would not otherwise be required to qualify but for this paragraph (e), (B)
subject itself to taxation in any such jurisdiction or (C) consent to general
service of process in any such jurisdiction.
(f) The Issuer will promptly notify each Selling Holder of such
Registrable Securities, at any time when a prospectus relating thereto is
required to be delivered under the Securities Act, of the discovery of any
condition or the occurrence of any event requiring the preparation of a
supplement or amendment to such prospectus so that, as thereafter delivered
to the purchasers of such Registrable Securities, such prospectus will not
contain an 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 promptly make available to each Selling Holder any
such supplement or amendment.
(g) The Issuer will enter into customary agreements (including an
underwriting agreement in customary form) and take such other actions as are
reasonably required in order to expedite or facilitate the disposition of
such Registrable Securities.
(h) The Issuer will make available for inspection by any Selling Holder,
any Underwriter participating in any disposition pursuant to such
registration statement and any attorney, accountant or other professional
retained by any such Selling Holder or Underwriter (collectively, the
"Inspectors"), all financial and other records, pertinent corporate documents
and properties of the Issuer (collectively, the "Records") as shall be
reasonably necessary to enable them to exercise their due diligence
responsibility, and cause the Issuer's officers, directors and employees to
supply all information reasonably requested by any Inspectors in connection
with such registration statement. Records which the Issuer determines, in
good faith, to be confidential and which it notifies the Inspectors are
confidential shall not be disclosed by the Inspectors unless (i) the
disclosure of such Records is necessary to avoid or correct a misstatement or
omission in such registration statement or (ii) the release of such Records
is ordered pursuant to a subpoena or other order from a court of competent
jurisdiction. Each Selling Holder of such Registrable Securities agrees 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 Issuer or its Affiliates unless and
until such information is made generally available to the public. Each
Selling Holder of such Registrable Securities further agrees that it will,
upon learning that disclosure of such Records is sought in a court of
competent jurisdiction, give notice to the Issuer and allow the Issuer, at
its expense, to undertake appropriate action to prevent disclosure of the
Records deemed confidential.
(i) The Issuer will use reasonable best efforts to cause to be furnished
to each Selling Holder and to each Underwriter, if any, a signed counterpart,
addressed to such Selling Holder or Underwriter, of (i) an opinion or
opinions of counsel to the Issuer and (ii) a comfort letter or comfort
letters from the Issuer's independent public accountants, each in customary
form and covering such matters of the type customarily covered by opinions of
counsel or comfort letters, as the case may be, as the managing Underwriter
for the offering reasonably requests.
(j) The Issuer will otherwise use its reasonable best efforts to comply
with all applicable rules and regulations of the Commission, and make
available to its securityholders, as soon as reasonably practicable, an
earnings statement covering the first fiscal year of the Issuer commencing
after the effective date of the registration statement, which earnings
statement shall satisfy the provisions of Section 11(a) of the Securities Act.
(k) The Issuer will use its reasonable best efforts to cause all such
Registrable Securities to be listed or quoted on each securities exchange or
inter-dealer automated quotation system on which similar securities issued by
the Issuer are then listed or quoted.
The Issuer may require each Selling Holder of Registrable Securities to
promptly furnish in writing to the Issuer such information regarding such
Selling Holder and the distribution of the Registrable Securities as the
Issuer may from time to time reasonably request and such other information as
may be legally required in connection with such registration.
Each Selling Holder agrees that, upon receipt of any notice from the
Issuer of the discovery of any condition or the happening of any event, in
each case of the kind described in Section 3.1(f) hereof, such Selling
Holder will forthwith discontinue disposition of Registrable Securities
pursuant to the registration statement covering such Registrable Securities
until such Selling Holder's receipt of the copies of the supplemented or
amended prospectus contemplated by Section 3.1(f) hereof, and, if so
directed by the Issuer, such Selling Holder will deliver to the Issuer (at
the Issuer's expense) all copies, other than permanent file copies then in
such Selling Holder's possession, of the most recent prospectus covering
such Registrable Securities at the time of receipt of such notice. In the
event the Issuer shall give such notice, the Issuer shall extend the period
during which such registration statement shall be maintained effective
(including the periods referred to in Sections 3.1(a) and 3.1(b) hereof) by
the number of days during the period from and including the date of the
giving of notice pursuant to Section 3.1(f) hereof to the date when the
Issuer shall make available to the Selling Holders of Registrable
Securities covered by such registration statement a prospectus supplemented
or amended to conform with the requirements of Section 3.1(f) hereof.
SECTION 3.2 Registration Expenses. In connection with any registration
statement required to be filed hereunder, the Issuer shall pay the following
expenses incurred in connection with the registration hereunder (the
"Registration Expenses"): (i) all registration and filing fees, (ii) fees and
expenses of compliance with State securities or "blue sky" laws (including
reasonable fees and disbursements of counsel in connection with blue sky
qualifications of the Registrable Securities), (iii) printing, messenger and
customary delivery expenses, (iv) internal expenses (including, without
limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), (v) the fees and expenses incurred in
connection with any listing or quotation of the Registrable Securities on any
securities exchange or inter-dealer automated quotation system, (vi)
reasonable fees and disbursements of counsel for the Issuer and customary
fees and expenses for independent certified public accountants retained by
the Issuer (including the costs associated with the delivery by independent
certified public accountants of a comfort letter or comfort letters requested
pursuant to Section 3.1(i) hereof), (vii) the reasonable fees and expenses of
any special experts retained by the Issuer in connection with such
registration, and (viii) reasonable fees and expenses of one counsel (who
shall be reasonably acceptable to the Issuer) for the Holders.
ARTICLE IV
INDEMNIFICATION AND CONTRIBUTION
SECTION 4.1 Indemnification by the Issuer. The Issuer agrees to
indemnify and hold harmless each Selling Holder of Registrable Securities,
its officers, directors, partners, employees, advisors and agents, and each
Person, if any, who controls such Selling Holder within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act from and
against any and all losses, claims, damages, expenses (including without
limitation reasonable costs of investigation and fees, disbursements and
other charges of counsel) and liabilities caused by any untrue statement or
alleged untrue statement of a material fact contained in any registration
statement or prospectus relating to the Registrable Securities (as amended
or supplemented if the Issuer shall have furnished any amendments or
supplements thereto) or any preliminary prospectus or any document
incorporated by reference in any of the foregoing, or caused by 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, claims, damages, expenses or liabilities are caused
by any such untrue statement or omission or alleged untrue statement or
omission based upon information furnished in writing to the Issuer by such
Selling Holder or on such Selling Holder's behalf expressly for use
therein. The Issuer also agrees to indemnify any Underwriters of the
Registrable Securities, their officers and directors and each person who
controls such underwriters on substantially the same basis as that of the
indemnification of the Selling Holders provided in this Section 4.1.
SECTION 4.2 Indemnification by Holders of Registrable Securities. Each
Selling Holder agrees, severally but not jointly, to indemnify and hold
harmless the Issuer, its officers, directors and agents and each Person, if
any, who controls the Issuer within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act to the same extent as the
foregoing indemnity from the Issuer to such Selling Holder, but only with
reference to information related to such Selling Holder furnished in writing
by such Selling Holder or on such Selling Holder's behalf expressly for use
in any registration statement or prospectus relating to the Registrable
Securities, or any amendment or supplement thereto, or any preliminary
prospectus; provided that the liability of any Selling Holder under this
Section 4.2 shall be limited to the net proceeds received by such Selling
Holder in the offering giving rise to such liability. In case any action or
proceeding shall be brought against the Issuer or its officers, directors or
agents or any such controlling person, in respect of which indemnity may be
sought against such Selling Holder, such Selling Holder shall have the rights
and duties given to the Issuer, and the Issuer or its officers, directors or
agents or such controlling person shall have the rights and duties given to
such Selling Holder, by the preceding paragraph. Each Selling Holder also
agrees to indemnify and hold harmless Underwriters of the Registrable
Securities, their officers and directors and each person who controls such
Underwriters on substantially the same basis as that of the indemnification
of the Issuer provided in this Section 4.2.
SECTION 4.3 Conduct of Indemnification Proceedings. In case any
proceeding (including any governmental investigation) shall be instituted
involving any person in respect of which indemnity may be sought pursuant
to Section 4.1 or 4.2, such person (an "Indemnified Party") shall promptly
notify the person against whom such indemnity may be sought (an
"Indemnifying Party") in writing and the Indemnifying Party shall assume
the defense thereof, including the employment of counsel reasonably
satisfactory to such Indemnified Party, and shall assume the payment of all
fees and expenses. In any such proceeding, any Indemnified Party shall have
the right to retain its own counsel, but the fees and expenses of such
counsel shall be at the expense of such Indemnified Party unless (i) the
Indemnifying Party and the Indemnified Party shall have mutually agreed to
the retention of such counsel or (ii) the named parties to any such
proceeding (including any impleaded parties) include both the Indemnified
Party and the Indemnifying Party and representation of both parties by the
same counsel would be inappropriate due to actual or potential differing
interests between them. It is understood that the Indemnifying Party shall
not, in connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the reasonable fees and expenses of more than
one separate firm of attorneys (in addition to any local counsel) at any
time for all such Indemnified Parties, and that all such fees and expenses
shall be reimbursed as they are incurred. In the case of any such separate
firm for the Indemnified Parties, such firm shall be designated in writing
by the Indemnified Parties. The Indemnifying Party shall not be liable for
any settlement of any proceeding effected without such consent, but if
settled with such consent, or if there be a final judgment for the
plaintiff, the Indemnifying Party shall indemnify and hold harmless such
Indemnified Parties from and against any loss or liability (to the extent
stated above) by reason of such settlement or judgment. No indemnifying
party shall, without the prior written consent of the indemnified party,
effect any settlement of any pending or threatened proceeding in respect of
which any indemnified party is or could have been a party and indemnity
could have been sought hereunder by such indemnified party, unless such
settlement includes an unconditional release of such indemnified party from
all liability arising out of such proceeding.
SECTION 4.4 Contribution. If the indemnification provided for in this
Article 4 is unavailable to the Indemnified Parties in respect of any losses,
claims, damages, expenses or liabilities referred to herein, then each such
Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a
result of such losses, claims, damages, expenses or liabilities (i) as
between the Issuer and the Selling Holders on the one hand and the
Underwriters on the other, in such proportion as is appropriate to reflect
the relative benefits received by the Issuer and the Selling Holders on the
one hand and the Underwriters on the other from the offering of the
Registrable Securities, or if such allocation is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits but also the relative fault of the Issuer and the Selling Holders on
the one hand and of the Underwriters on the other in connection with the
statements or omissions which resulted in such losses, claims, damages,
expenses or liabilities, as well as any other relevant equitable
considerations, and (ii) as between the Issuer on the one hand and each
Selling Holder on the other, in such proportion as is appropriate to reflect
the relative fault of the Issuer and of each Selling Holder in connection
with such statements or omissions, as well as any other relevant equitable
considerations. The relative benefits received by the Issuer and the Selling
Holders on the one hand and the Underwriters on the other shall be deemed to
be in the same proportion as the total proceeds from the offering (net of
underwriting discounts and commissions but before deducting expenses)
received by the Issuer and the Selling Holders bear to the total underwriting
discounts and commissions received by the Underwriters, in each case as set
forth in the table on the cover page of the prospectus. The relative fault of
the Issuer and the Selling Holders on the one hand and of the Underwriters on
the other 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 and the Selling Holders or by the Underwriters. The relative fault
of the Issuer on the one hand and of each Selling Holder on the other shall
be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by such
party, and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Issuer and the Selling Holders agree that it would not be just and
equitable if contribution pursuant to this Section 4.4 were determined by
pro rata allocation (even if the Underwriters were treated as one entity
for such purpose) or by any other method of allocation which did not take
account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an Indemnified Party as
a result of the losses, claims, damages or liabilities referred to in the
immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably
incurred by such Indemnified Party in connection with investigating or
defending any such action or claim. Notwithstanding the provisions of this
Section 4.4, no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the Securities
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages which such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission, and no Selling Holder shall be required to
contribute any amount in excess of the amount by which the total price at
which the Securities of such Selling Holder were offered to the public
exceeds the amount of any damages which such Selling 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 Selling Holders' obligations to
contribute pursuant to this Section 4.4 are several in proportion to the
proceeds of the offering received by each such Selling Holder bears to the
total proceeds of the offering received by all the Selling Holders and not
joint.
ARTICLE V
MISCELLANEOUS
SECTION 5.1 Participation in Underwritten Registrations. No Person may
participate in any underwritten registration hereunder unless such Person (a)
agrees to sell such Person's 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
reasonably required under the terms of such underwriting arrangements and
hereunder.
SECTION 5.2 Rule 144 and Rule 145. The Issuer covenants that it will
file any reports required to be filed by it under the Securities Act and the
Exchange Act and that it will take such further action as any Holder may
reasonably request, all to the extent required from time to time to enable
Holders to sell Registrable Securities without registration under the
Securities Act within the limitation of the exemptions provided by (a) Rule
144 and Rule 145 under the Securities Act, as such Rules may be amended from
time to time, or (b) any similar rule or regulation hereafter adopted by the
Commission. Upon the request of any Holder, the Issuer will deliver to such
Holder a written statement as to whether it has complied with such
requirements.
SECTION 5.3 Holdback Agreements. (a) Restrictions on Public Sale by
Holder of Registrable Securities. To the extent not inconsistent with
applicable law, each Holder whose securities are included in a registration
statement agrees not to effect any public sale or distribution of securities
of the same class as the securities being registered or a similar security of
the Issuer, or any securities convertible into or exchangeable or exercisable
for such securities, including a sale pursuant to Rule 144 or Rule 145 under
the Securities Act, during the 14 days prior to, and during the up to 180-day
period beginning on, the effective date of such registration statement
(except as part of such registration), if and to the extent requested by the
Issuer in the case of a non-underwritten public offering or if and to the
extent requested by the managing Underwriter or Underwriters in the case of
an underwritten public offering.
(b) Restrictions on Public Sale by the Issuer and Others. The Issuer
agrees not to effect any public sale or distribution of any securities of
the same class as those being registered in accordance with Section 2.2 or
Section 2.3 hereof, or any securities convertible into or exchangeable or
exercisable for such securities, during the 14 days prior to, and during
the period beginning on, the effective date requested by the managing
Underwriter or Underwriters (which period shall not exceed 90 days) of any
registration statement with respect to an underwritten public offering
(except as part of such registration statement as provided herein);
provided that the provisions of this paragraph (b) shall not prevent the
conversion or exchange of any securities pursuant to their terms into or
for other securities.
SECTION 5.4 Delay of Registration. No Holder shall have any right to
take any action to restrain, enjoin, or otherwise delay any registration as
the result of any controversy that might arise with respect to the
implementation of this Agreement.
SECTION 5.5 Governing Law. This Agreement shall be interpreted,
construed and enforced in accordance with the laws of the State of New York.
SECTION 5.6 Successors and Assigns. Except as otherwise expressly
provided herein, the provisions hereof shall inure to the benefit of, and be
binding upon, the successors and assigns of the parties hereto.
SECTION 5.7 Entire Agreement; Amendment; Waiver. This Agreement
constitutes the full and entire understanding and agreement between the
parties hereto with respect to the subject hereof. Neither this Agreement nor
any terms hereof may be amended, waived, discharged or terminated, except by
a written instrument signed by the holders of at least a majority of the
Registrable Securities outstanding as of such time and the Issuer and any
such amendment, waiver, discharge or termination shall be binding on all the
Holders, but in no event shall the obligation of any Holder hereunder be
materially increased, except upon the written consent of such Holder.
SECTION 5.8 Notices, etc. All notices and other communications required
or permitted hereunder to the Issuer shall be in writing and shall be mailed
by first-class mail, postage prepaid, or delivered by hand, facsimile
transmission or by messenger, addressed to it at 00000 Xxxxx Xxxxxxxxxxxx
Xxxxxx, Xxxxxx, XX 00000, Attn.: General Counsel, or to such other address as
the Issuer may specify by notice to the Holders.
SECTION 5.9 Separability. In case any provision of this Agreement shall
be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected
or impaired thereby.
SECTION 5.10 Titles and Subtitles. The titles of the paragraphs and
subparagraphs of this Agreement are for convenience of reference only and are
not to be considered in construing this Agreement.
SECTION 5.11 Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be an original, but all of which
together shall constitute one instrument.
* * * * *
[SIGNATURE PAGE TO COMMON STOCK REGISTRATION RIGHTS AGREEMENT] IN
WITNESS WHEREOF, the parties hereto have set their hands as of the date first
above written.
CONSECO, INC.
By:/s/Xxxxxx X. Xxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Senior Vice President and
Treasurer
XXXXXX XXXXXX & CO., L.P.,
on behalf of itself and its
affiliates
By: AG Partners, L.P.,
Its General Partner
By:/s/Xxxxxxx X. Xxxxxxx
----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: Authorized Signatory
APPALOOSA MANAGEMENT, L.P.,
on behalf of certain funds for which
it acts as investment advisor
By:/s/Xxxxxx Xxxxxxxxx
----------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Authorized Signatory
[SIGNATURE PAGE TO COMMON STOCK REGISTRATION RIGHTS AGREEMENT]
CONSECO FINANCE CORP.
By:/s/Xxxxxxx X. Xxxxxxx
----------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President and Chief
Executive Officer
[SIGNATURE PAGE TO COMMON STOCK REGISTRATION RIGHTS AGREEMENT]
ANNEX A
FORM OF NOTICE TO BE DELIVERED
IN CONNECTION WITH A REQUEST FOR
DEMAND REGISTRATION
, 200
------------ --
CONSECO, INC.
00000 X. Xxxxxxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Dear Sirs:
Pursuant to Section 2.2 of the Registration Rights Agreement dated
September 10, 2003, the undersigned hereby requests Conseco, Inc. (the
"Company") to register __________ shares of the Company's Common Stock, of
which the undersigned is the registered holder.
[We request that such securities be sold in an underwritten offering
[to be lead-managed by _________________]].
[Name of Transferor]
By:
-----------------------------------
