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EXHIBIT 4.2
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "AGREEMENT") is made and entered
into as of June 12, 2001 by and among Nortek, Inc., a Delaware corporation (the
"COMPANY"), Bear, Xxxxxxx & Co. Inc. and Dresdner Kleinwort Xxxxxxxxxxx -
Grantchester, Inc. (collectively, the "INITIAL PURCHASERS").
This Agreement is made pursuant to the Purchase Agreement dated as of June
7, 2001 (the "PURCHASE AGREEMENT"), between the Company and the Initial
Purchasers, which provides for the sale by the Company to the Initial Purchasers
of $250,000,000 aggregate principal amount of the Company's 9-7/8% Series A
Senior Subordinated Notes due 2011 (the "NOTES"). In order to induce the Initial
Purchasers to enter into the Purchase Agreement and to purchase the Notes, the
Company has agreed to provide to the Initial Purchasers and their direct and
indirect transferees the registration rights for the Notes set forth in this
Agreement. The execution and delivery of this Agreement is a condition precedent
to the obligations of the Initial Purchasers under the Purchase Agreement.
In consideration of the foregoing, the parties hereto agree as follows:
1. DEFINITIONS. As used in this Agreement, the following capitalized
defined terms shall have the following meanings (and, unless otherwise
indicated, capitalized terms used herein without definition shall have the
meanings ascribed to them in the Purchase Agreement):
"ACT" shall mean the Securities Act of 1933, as amended.
"AGREEMENT" shall have the meaning set forth in the preamble to this
Agreement.
"APPLICABLE PERIOD" shall have the meaning set forth in Section 3(t)
hereof.
"CLOSING DATE" shall mean the Closing Date as defined in the Purchase
Agreement.
"COMMISSION" shall mean the Securities and Exchange Commission, or such
other federal agency administering the Act or the Exchange Act.
"COMPANY" shall have the meaning set forth in the preamble to this
Agreement, and shall also include the Company's successors.
"DEPOSITARY" shall mean The Depository Trust Company, or any successor
depositary appointed by the Company; PROVIDED, HOWEVER, that such depositary
must have an address in the Borough of Manhattan, The City of New York.
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"EFFECTIVENESS PERIOD" shall have the meaning set forth in Section 2(b)
hereof.
"EVENT DATE" shall have the meaning set forth in Section 2(e) hereof.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as amended.
"EXCHANGE NOTES" shall mean the 9-7/8% Series B Senior Subordinated Notes
due 2011, to be issued by the Company under the Indenture and containing terms
identical to the Notes (except that (i) interest thereon shall accrue from the
last date on which interest was paid on the Notes or, if no such interest has
been paid, from June 12, 2001, and (ii) the transfer restrictions thereon shall
be eliminated) to be offered to Holders of Notes in exchange for Notes pursuant
to the Exchange Offer.
"EXCHANGE OFFER" shall mean the exchange offer by the Company of Exchange
Notes for Notes pursuant to Section 2(a) hereof.
"EXCHANGE OFFER REGISTRATION" shall mean a registration under the Act
effected pursuant to Section 2(a) hereof.
"EXCHANGE OFFER REGISTRATION STATEMENT" shall mean the registration
statement (on Form S-4 or, if applicable, on any other appropriate form)
relating to the Exchange Offer, and all amendments and supplements to such
registration statement, including post-effective amendments, in each case
including the Prospectus contained therein, all exhibits thereto and all
material incorporated by reference therein.
"EXCHANGE PERIOD" shall have the meaning set forth in Section 2(a) hereof.
"HOLDER" shall mean each Initial Purchaser, for so long as such Initial
Purchaser owns any Registrable Securities, and each of such Initial Purchaser's
respective successors, assigns and direct and indirect transferees who become
registered owners of Registrable Securities under the Indenture.
"INDENTURE" shall mean the Indenture dated as of June 12, 2001 by and
between the Company and State Street Bank and Trust Company, as trustee, as the
same may be amended or supplemented from time to time in accordance with the
terms thereof.
"INITIAL PURCHASERS" shall have the meaning set forth in the preamble to
this Agreement.
"INSPECTORS" shall have the meaning set forth in Section 3(n) hereof.
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"LIQUIDATED DAMAGES" shall have the meaning set forth in Section 2(e)
hereof.
"MAJORITY HOLDERS" shall mean the Holders of a majority of the aggregate
principal amount of outstanding (as determined under the Indenture) Registrable
Securities.
"NASD" shall mean the National Association of Securities Dealers, Inc.
"NOTES" shall have the meaning set forth in the preamble to this Agreement.
"PARTICIPATING BROKER-DEALER" shall have the meaning set forth in Section
3(t) hereof.
"PERSON" shall mean any individual, corporation, limited liability company,
general or limited partnership, limited liability partnership, joint venture,
association, joint-stock company, trust, charitable foundation, unincorporated
organization, government or agency or political subdivision thereof or any other
entity.
"PRIVATE EXCHANGE" shall have the meaning set forth in Section 2(a) hereof.
"PRIVATE EXCHANGE NOTES" shall have the meaning set forth in Section 2(a)
hereof.
"PROSPECTUS" shall mean the prospectus included in a Registration
Statement, including any preliminary prospectus, and any such prospectus as
amended or supplemented by any prospectus supplement, including a prospectus
supplement with respect to the terms of the offering of any portion of the
Registrable Securities covered by a Shelf Registration Statement, including
post-effective amendments, and in each case including all material incorporated
by reference therein.
"PURCHASE AGREEMENT" shall have the meaning set forth in the preamble to
this Agreement.
"RECORDS" shall have the meaning set forth in Section 3(n) hereof.
"REGISTRABLE SECURITIES" shall mean the Notes and, if issued, the Private
Exchange Notes; PROVIDED, HOWEVER, that Notes or Private Exchange Notes, as the
case may be, shall cease to be Registrable Securities when (i) a Registration
Statement with respect to such Notes or Private Exchange Notes or the resale
thereof shall have been declared effective under the Act and such Notes or
Private Exchange Notes, as the case may be, shall have been disposed of pursuant
to such Registration Statement, (ii) such Notes or Private Exchange Notes, as
the case may be, shall have become eligible to be
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sold to the public pursuant to Rule 144(k) (or any similar provision then in
force, but not Rule 144A) under the Act, (iii) such Notes or Private Exchange
Notes, as the case may be, shall have ceased to be outstanding or (iv) with
respect to the Notes, such Notes have been exchanged for Exchange Notes upon
consummation of the Exchange Offer.
"REGISTRATION EXPENSES" shall mean any and all expenses incident to
performance of or compliance by the Company with this Agreement, including,
without limitation: (i) Commission, stock exchange and NASD registration and
filing fees, including, if applicable, the fees and expenses of any "qualified
independent underwriter" and its counsel that is required to be retained by any
Holder of Registrable Securities in accordance with the rules and regulations of
the NASD, (ii) fees and expenses incurred in connection with compliance with
state securities or blue sky laws (including reasonable fees and disbursements
of counsel for any underwriters or Holders in connection with the blue sky
qualification of any of the Exchange Notes or Registrable Securities) and
compliance with the rules of the NASD, (iii) expenses of any Persons in
preparing or assisting in preparing, printing and distributing any Registration
Statement, any Prospectus and any amendments or supplements thereto, and in
preparing or assisting in preparing, printing and distributing any underwriting
agreements, securities sales agreements and other documents relating to the
performance of and compliance with the obligations under this Agreement, (iv)
rating agency fees, (v) fees and disbursements of counsel for and independent
certified public accountants of the Company, including the expenses of any "cold
comfort" letters required by or incident to such performance and compliance,
(vi) fees and expenses of the Trustee, and any exchange agent or custodian,
(vii) fees and expenses incurred in connection with the listing, if any, of any
of the Registrable Securities on any securities exchange or exchanges, and
(viii) the reasonable fees and expenses of any special experts retained by the
Company in connection with any Registration Statement.
"REGISTRATION STATEMENT" shall mean any registration statement of the
Company relating to the Exchange Notes or Registrable Securities pursuant to the
provisions of this Agreement, and all amendments and supplements to any such
registration statement, including post-effective amendments, in each case
including the Prospectus contained therein, all exhibits thereto and all
material incorporated by reference therein.
"SHELF REGISTRATION" shall mean a registration effected pursuant to Section
2(b) hereof.
"SHELF REGISTRATION STATEMENT" shall mean a "shelf" registration statement
of the Company pursuant to the provisions of Section 2(b) of this Agreement
which covers all of the Registrable Securities, on an appropriate form under
Rule 415 under the Act, or any similar rule that may be adopted by the
Commission, and all amendments and supplements to such registration statement,
including post-effective amendments, in each
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case including the Prospectus contained therein, all exhibits thereto and all
material incorporated by reference therein.
"TIA" shall mean the Trust Indenture Act of 1939, as amended.
"TRANSFER RESTRICTED SECURITIES" shall mean each Note until (i) the date on
which such Note has been exchanged by a Person other than a broker-dealer for an
Exchange Note in the Exchange Offer, (ii) following the exchange by a
broker-dealer in the Exchange Offer of a Note for an Exchange Note, the date on
which such Exchange Note is sold to a purchaser who receives from such
broker-dealer on or prior to the date of such sale a copy of the prospectus
contained in the Exchange Offer Registration Statement, (iii) the date on which
such Note has been effectively registered under the Securities Act and disposed
of in accordance with the Shelf Registration Statement or (iv) the date on which
such Note is distributed to the public pursuant to Rule 144 under the Securities
Act.
"TRUSTEE" shall mean the trustee under the Indenture.
2. REGISTRATION UNDER THE ACT.
(a) EXCHANGE OFFER. To the extent not prohibited by any applicable
law or applicable interpretation of the staff of the Commission, the Company
shall, for the benefit of the Holders, at the Company's cost, use its best
efforts to cause to be filed with the Commission an Exchange Offer Registration
Statement on or prior to 90 days after the Closing Date on an appropriate form
under the Act covering the offer by the Company to the Holders to exchange all
of the Registrable Securities (other than Private Exchange Notes) for a like
aggregate principal amount of Exchange Notes, to cause such Exchange Offer
Registration Statement to be declared effective under the Act by the Commission
on or prior to 165 days after the Closing Date, to cause such Registration
Statement to remain effective until the closing of the Exchange Offer and to
cause the Exchange Offer to be consummated on or prior to 45 days after the date
on which the Exchange Offer Registration Statement was declared effective under
the Act by the Commission. The Exchange Notes will be issued under the
Indenture. Upon the effectiveness of the Exchange Offer Registration Statement,
the Company shall promptly commence the Exchange Offer, it being the objective
of such Exchange Offer to enable each Holder (other than Participating
Broker-Dealers (as defined in Section 3(t) hereof)) eligible and electing to
exchange Registrable Securities for Exchange Notes (assuming that such Holder is
not an affiliate of the Company within the meaning of Rule 405 under the Act,
acquires the Exchange Notes in the ordinary course of such Holder's business and
has no arrangements or understandings with any Person to participate in the
Exchange Offer for the purpose of distributing the Exchange Notes) to transfer
such Exchange Notes from and after their receipt without any limitations or
restrictions under the Act or under state securities or blue sky laws.
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In connection with the Exchange Offer, the Company shall:
(i) mail to each Holder a copy of the Prospectus forming part of the
Exchange Offer Registration Statement together with an appropriate letter
of transmittal and related documents;
(ii) keep the Exchange Offer open for acceptance for a period of not
less than 30 days after the date notice thereof is mailed to the Holders,
or longer if required by applicable law (such period being referred to
herein as the "EXCHANGE PERIOD");
(iii) utilize the services of the Depositary for the Exchange Offer;
(iv) permit Holders to withdraw tendered Notes at any time prior to
the close of business, New York City time, on the last business day of the
Exchange Period, by sending to the institution specified in the notice a
telegram, telex, facsimile transmission or letter setting forth the name of
such Holder, the principal amount of Notes delivered for exchange, and a
statement that such Holder is withdrawing its election to have such Notes
exchanged;
(v) notify each Holder that any Note not tendered will remain
outstanding and continue to accrue interest, but will not retain any rights
under this Agreement (except in the case of the Initial Purchasers and
Participating Broker-Dealers as provided herein); and
(vi) otherwise comply in all respects with all applicable laws
relating to the Exchange Offer.
If, prior to consummation of the Exchange Offer, any Initial Purchaser
holds any Notes acquired by it and having the status of an unsold allotment in
the initial distribution, the Company upon the request of such Initial Purchaser
shall, simultaneously with the delivery of the Exchange Notes in the Exchange
Offer, issue and deliver to such Initial Purchaser in exchange (the "PRIVATE
EXCHANGE") for Notes held by such Initial Purchaser a like principal amount of
debt securities of the Company that are identical (except that such securities
shall bear appropriate transfer restrictions) to the Exchange Notes (the
"PRIVATE EXCHANGE NOTES") and which are issued pursuant to the Indenture (which
will provide that the Exchange Notes will not be subject to the transfer
restrictions set forth in the Indenture and that the Exchange Notes, the Private
Exchange Notes and the Notes will vote and consent together on all matters as
one class and that none of the Exchange Notes, the Private Exchange Notes or the
Notes will have the right to vote or consent as a separate class on any matter).
The Private Exchange Notes shall be of the same series as and shall bear the
same CUSIP number as the Exchange Notes.
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As soon as practicable after the close of the Exchange Offer or the Private
Exchange, as the case may be, the Company shall:
(i) accept for exchange all Notes or portions thereof duly tendered
and not validly withdrawn pursuant to the Exchange Offer;
(ii) accept for exchange all Notes or portions thereof duly tendered
pursuant to the Private Exchange; and
(iii) deliver, or cause to be delivered, to the Trustee for
cancellation all Notes or portions thereof so accepted for exchange by the
Company, and issue, and cause the Trustee to promptly authenticate and
deliver to each Holder, a new Exchange Note or Private Exchange Note, as
the case may be, equal in principal amount to the principal amount of the
Notes surrendered by such Holder.
To the extent not prohibited by applicable law or any applicable
interpretation of the staff of the Commission, the Company shall use its best
efforts to complete the Exchange Offer as provided above, and shall comply with
all applicable requirements of the Act, the Exchange Act and other applicable
laws in connection with the Exchange Offer. The Exchange Offer shall not be
subject to any condition, other than that (i) the Exchange Offer does not
violate any applicable law or interpretation of the staff of the Commission,
(ii) no action or proceeding has been instituted or threatened in any court or
by or before any governmental agency with respect to the Exchange Offer which,
in the reasonable judgment of the Company, might impair the ability of the
Company to proceed with the Exchange Offer, (iii) there has not been any
material change, or development involving a prospective material change, in the
business or financial affairs of the Company or any of its subsidiaries which,
in the reasonable judgment of the Company, would materially impair the Company's
ability to consummate the Exchange Offer or have a material adverse effect on
the Company if the Exchange Offer is consummated, (iv) there has not been
proposed, adopted, or enacted any law, statute, rule or regulation which, in the
reasonable judgment of the Company, might materially impair the ability of the
Company to proceed with the Exchange Offer or have a material adverse effect on
the Company if the Exchange Offer is consummated or (v) all governmental
approvals which the Company shall reasonably deem necessary for the consummation
of the Exchange Offer as contemplated shall have been obtained. Each Holder of
Registrable Securities who wishes to exchange such Registrable Securities for
Exchange Notes in the Exchange Offer will be required to make certain customary
representations in connection therewith, including representations that such
Holder is not an affiliate of the Company within the meaning of Rule 405 under
the Act, that any Exchange Notes to be received by it will be acquired in the
ordinary course of business and that at the time of the commencement of the
Exchange Offer it had no arrangement with any Person to participate in the
distribution (within the meaning of the Act) of the Exchange Notes and will be
required to make such other representations as
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may be necessary under applicable Commission rules, regulations or
interpretations to render available the use of Form S-4 or any other appropriate
form under the Act. The Company shall inform the Initial Purchasers, after
consultation with the Trustee and the Initial Purchasers, of the names and
addresses of the Holders to whom the Exchange Offer is made, and the Initial
Purchasers shall have the right to contact such Holders and otherwise facilitate
the tender of Registrable Securities in the Exchange Offer.
In the event that the Company is unable to consummate the Exchange Offer
due to any event listed in clauses (i) through (v) in the paragraph immediately
above, the Company shall not be deemed to have breached any covenant under this
Section 2(a).
Upon consummation of the Exchange Offer in accordance with this Section
2(a), the provisions of this Agreement shall continue to apply, mutatis
mutandis, solely with respect to Registrable Securities that are Private
Exchange Notes and Exchange Notes held by Participating Broker-Dealers, and the
Company shall have no further obligation to register Registrable Securities
(other than Private Exchange Notes) pursuant to Section 2(b) of this Agreement.
(b) SHELF REGISTRATION. In the event that (i) the Company is not
permitted to commence or accept tenders pursuant to the Exchange Offer because
the Exchange Offer is not permitted by applicable law or Commission policy, (ii)
any Holder of Transfer Restricted Securities notifies the Company within 20
business days after the consummation of the Exchange Offer that (A) it is
prohibited by law or Commission policy from participating in the Exchange Offer,
(B) that it may not resell the Exchange Notes acquired by it in the Exchange
Offer to the public without delivering a prospectus and the prospectus contained
in the Exchange Offer Registration Statement is not appropriate or available for
such resales or (C) that it is a broker-dealer and owns Notes acquired directly
from the Company or an affiliate of the Company, or (iii) the Exchange Offer is
not for any other reason consummated within 210 days of the Closing Date, the
Company shall, at its cost, cause to be filed with the Commission as promptly as
practicable after such determination or date, as the case may be, and, in any
event, on or prior to 45 days thereafter, a Shelf Registration Statement
providing for the sale by the Holders of all of the Registrable Securities, and
shall use its best efforts to cause such Shelf Registration Statement declared
effective by the Commission on or prior to 90 days after such determination or
date. No Holder of Registrable Securities may include any of its Registrable
Securities in any Shelf Registration pursuant to this Agreement unless and until
such Holder furnishes to the Company in writing, within 15 days after receipt of
a request therefor, such information as the Company may, after conferring with
counsel with regard to information relating to Holders that would be required by
the Commission to be included in such Shelf Registration Statement or Prospectus
included therein, reasonably request for inclusion in any Shelf Registration
Statement or Prospectus included therein. Each Holder as to which any Shelf
Registration is being effected agrees to furnish promptly to the Company all
information required to be disclosed in the
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applicable Shelf Registration Statement or Prospectus included therein by the
rules and regulations of the Commission applicable to the Shelf Registration
Statement in order to make the information previously furnished to the Company
by such Holder not materially misleading.
The Company agrees, subject to applicable law or applicable interpretation
of the staff of the Commission, to use its reasonable best efforts to keep the
Shelf Registration Statement continuously effective, supplemented and amended
under the Act for a period ending on the earlier of the date which is two years
from the Closing Date (subject to extension pursuant to the last paragraph of
Section 3) or the date on which all of the Registrable Securities covered by the
Shelf Registration Statement have been sold pursuant to the Shelf Registration
Statement or cease to be outstanding (the "EFFECTIVENESS PERIOD"). The Company
shall not permit any securities other than Registrable Securities to be included
in the Shelf Registration. The Company will, in the event a Shelf Registration
Statement is declared effective, provide to each Holder copies of the prospectus
which is a part of the Shelf Registration Statement, notify each such Holder
when the Shelf Registration Statement has become effective and take certain
other actions as are customary to permit unrestricted resales of the Registrable
Securities covered by the Shelf Registration Statement. The Company further
agrees, if necessary, to use its reasonable best efforts to supplement or amend
the Shelf Registration Statement, if required by the Act or the rules,
regulations or instructions applicable to the registration form used by the
Company for such Shelf Registration Statement or by any other rules and
regulations thereunder for shelf registrations, or if reasonably requested by
the holders of a majority of the Registrable Securities covered by such Shelf
Registration Statement, and the Company agrees to furnish to the Holders copies
of any such supplement or amendment promptly after its being used or filed with
the Commission.
(c) EXPENSES. The Company shall pay all Registration Expenses in
connection with registrations pursuant to Section 2(a) or Section 2(b). Each
Holder shall pay all expenses of its counsel (other than the fees described in
clauses (i) and (ii) of the definition of "Registration Expenses"), underwriting
discounts and commissions and transfer taxes, if any, relating to the sale or
disposition of such Holder's Registrable Securities pursuant to the Exchange
Offer Registration Statement and the Shelf Registration Statement.
(d) EFFECTIVE REGISTRATION STATEMENT. An Exchange Offer Registration
Statement pursuant to Section 2(a) hereof or a Shelf Registration Statement
pursuant to Section 2(b) hereof will not be deemed to have become effective
unless it has been declared effective by the Commission; PROVIDED, HOWEVER, that
if, after it has been declared effective, the offering of Registrable Securities
pursuant to a Shelf Registration Statement is interfered with by any stop order,
injunction or other order or requirement of the Commission or any other
governmental agency or court, such Registration Statement will be deemed not to
have been effective during the period of such interference, until the
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offering of Registrable Securities pursuant to such Registration Statement may
legally resume.
(e) LIQUIDATED DAMAGES. In the event that an Exchange Offer
Registration Statement has not been filed with the Commission on or prior to 90
days after the Closing Date, additional interest payable by the Company as
liquidated damages ("LIQUIDATED DAMAGES") will accrue on the Notes from and
including the 91st day after the Closing Date until but excluding the date such
Exchange Offer Registration Statement is filed. In addition, if on or prior to
165 days after the Closing Date, such Exchange Offer Registration Statement is
not declared effective under the Act by the Commission, Liquidated Damages will
accrue on the Notes from and including the 166th day after the Closing Date
until but excluding the date such Exchange Offer Registration Statement is
declared effective. Further, if on or prior to 45 days after the date specified
for effectiveness of the Exchange Offer Registration Statement the Exchange
Offer is not consummated, Liquidated Damages will accrue on the Notes from and
including the 46th day after the date specified for effectiveness of the
Exchange Offer Registration Statement until but excluding the date of the
Exchange Offer is consummated. If a Shelf Registration Statement is required to
be filed pursuant to Section 2(b) and such Shelf Registration Statement is not
filed or declared effective within the time periods provided by Section 2(b)
hereof for such filing or declaration, Liquidated Damages will accrue on the
Notes (other than those exchanged in the Exchange Offer) or the Private Exchange
Notes, as the case may be, from and including the day immediately following such
default until but excluding the effective date of the Shelf Registration
Statement. Further, if the Shelf Registration Statement or the Exchange Offer
Registration Statement is declared effective but thereafter ceases to be
effective or usable during the time periods specified in this Agreement,
Liquidated Damages will accrue on the Notes (other than those exchanged in the
Exchange Offer) or the Private Exchange Notes, as the case may be, from and
including the day immediately following such default until but excluding the
date such Registration Statement becomes effective or usable. In each case, such
Liquidated Damages will be payable in cash semiannually in arrears, with the
first semiannual payment due on the first interest payment date in respect of
the Notes (or the Private Exchange Notes) following the date from which
Liquidated Damages begin to accrue, and will accrue, under each circumstance set
forth above in an amount equal to $0.05 per week per $1,000 principal amount of
Notes (or Private Exchange Notes) held by such Holder to each Holder affected by
such circumstance, which amount will increase by $0.05 per week per $1,000
principal amount of Notes (or Private Exchange Notes) for each 90-day period
that such Liquidated Damages continue to accrue under any circumstance, up to a
maximum amount of Liquidated Damages of $0.25 per week per $1,000 principal
amount of Notes (or Private Exchange Notes). For any portion of a week that
Liquidated Damages are payable hereunder, such Liquidated Damages shall be
calculated on a pro rata basis.
Upon the filing of the Exchange Offer Registration Statement, the
effectiveness of the Exchange Offer Registration Statement, or the consummation
of the
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Exchange Offer, as the case may be, the Liquidated Damages assessed in respect
of the Notes shall cease to accrue to the extent that such Liquidated Damages
related to the failure of any such event to have occurred. Upon the
effectiveness of a Shelf Registration Statement, the Liquidated Damages assessed
in respect of the Notes (and the Private Exchange Notes) shall cease to accrue,
from and as of the date of such effectiveness, unless and until reassessed as
described above. Notwithstanding anything to the contrary contained herein, the
Company (i) shall not be required to amend or supplement the Shelf Registration
Statement, any related prospectus or any document incorporated therein by
reference and (ii) may suspend the effectiveness of any such Shelf Registration
Statement in the event that, and for a period not to exceed, for so long as this
Agreement is in effect, an aggregate of 90 days in any one calendar year if (A)
an event occurs and is continuing as a result of which the Shelf Registration
Statement, any related prospectus or any document incorporated therein by
reference as then amended or supplemented would, in the Company's good faith
judgment, contain an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein not misleading,
and (B) the Company determines in its good faith judgment that the disclosure of
such event at such time would have a material adverse effect on the business,
operations or prospects of the Company; provided that any such suspension shall
not relieve the Company from its obligation to pay Liquidated Damages.
The Company shall notify the Trustee within three business days after each
and every date on which an event occurs in respect of which Liquidated Damages
is required to be paid (an "EVENT DATE"). Liquidated Damages shall be paid by
depositing with the Trustee, in trust, for the benefit of the Holders of Notes,
Exchange Notes or Private Exchange Notes, as the case may be, on or before the
applicable semiannual interest payment date, immediately available funds in sums
sufficient to pay the Liquidated Damages then due. The Liquidated Damages due
shall be payable on each interest payment date to the record Holder of Notes
entitled to receive the interest payment to be paid on such date as set forth in
the Indenture. Each obligation to pay Liquidated Damages shall be deemed to
accrue from and including the day following the applicable Event Date.
(f) SPECIFIC ENFORCEMENT. Without limiting the remedies available to
the Initial Purchasers and the Holders, the Company acknowledges that any
failure by the Company to comply with its obligations under Section 2(a) and
Section 2(b) hereof would result in material irreparable injury to the Initial
Purchasers or the Holders for which there is no adequate remedy at law, that it
would not be possible to measure damages for such injuries precisely and that,
in the event of any such failure, the Initial Purchasers or any Holder may
obtain such relief as may be required to specifically enforce the Company's
obligations under Section 2(a) and Section 2(b) hereof.
3. REGISTRATION PROCEDURES. In connection with the obligations of the
Company with respect to the Registration Statements pursuant to Sections 2(a)
and 2(b) hereof, the Company shall:
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(a) prepare and file with the Commission a Registration Statement or
Registration Statements as prescribed by Sections 2(a) and 2(b) within the
relevant time periods specified in Section 2 hereof on the appropriate form
under the Act, which form (i) shall be selected by the Company, (ii) shall, in
the case of a Shelf Registration, be available for the sale of the Registrable
Securities by the selling Holders and (iii) shall comply as to form in all
material respects with the requirements of the applicable form and include or
incorporate by reference all financial statements required by the Commission to
be filed therewith, and the Company shall use its best efforts to cause such
Registration Statement to become effective and remain effective in accordance
with Section 2; PROVIDED, HOWEVER, that if (1) such filing is pursuant to
Section 2(b), or (2) a Prospectus contained in an Exchange Offer Registration
Statement filed pursuant to Section 2(a) is required to be delivered under the
Act by any Participating Broker-Dealer who seeks to sell Exchange Notes, before
filing any Registration Statement or Prospectus or any amendments or supplements
thereto, the Company, if requested, shall furnish to and afford the Holders and
each such Participating Broker-Dealer, as the case may be, covered by such
Registration Statement, their counsel and the managing underwriters, if any, a
reasonable opportunity to review copies of all such documents (including copies
of any documents to be incorporated by reference therein and all exhibits
thereto) proposed to be filed at least five (5) business days prior to such
filing. The Company shall not file any Registration Statement or Prospectus or
any amendments or supplements thereto in respect of which the Holders, pursuant
to this Agreement, must be afforded an opportunity to review prior to the filing
of such document, if the holders of a majority of the Registrable Securities
covered by such Registration Statement or such Participating Broker-Dealer, as
the case may be, their counsel or the managing underwriters, if any, shall
reasonably object;
(b) subject to Section 3(a) hereof, prepare and file with the
Commission such amendments and post-effective amendments to each Registration
Statement as may be necessary to keep such Registration Statement effective for
the Effectiveness Period or the Applicable Period, as the case may be, and cause
each Prospectus to be supplemented by any required prospectus supplement and as
so supplemented to be filed pursuant to Rule 424 (or any similar provision then
in force) under the Act, and comply with the provisions of the Act, the Exchange
Act and the rules and regulations promulgated thereunder applicable to it with
respect to the disposition of all securities covered by each Registration
Statement during the Effectiveness Period or the Applicable Period, as the case
may be, in accordance with the intended method or methods of distribution by the
selling Holders thereof described in this Agreement (including sales by any
Participating Broker-Dealer);
(c) in the case of a Shelf Registration, (i) notify each Holder, at
least five (5) business days prior to filing, that a Shelf Registration
Statement with respect to the Registrable Securities is being filed and advising
such Holder that the distribution of Registrable Securities will be made in
accordance with the method selected by the Majority Holders, (ii) furnish to
each Holder and to each underwriter of an underwritten
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offering of Registrable Securities, if any, without charge, as many copies of
each Prospectus, including each preliminary Prospectus, and any amendment or
supplement thereto and such other documents as such Holder or underwriter may
reasonably request, in order to facilitate the public sale or other disposition
of the Registrable Securities, and (iii) subject to the last paragraph of this
Section 3, consent to the use of the Prospectus or any amendment or supplement
thereto by each of the selling Holders in connection with the offering and sale
of the Registrable Securities covered by the Prospectus or any amendment or
supplement thereto, provided that such use complies with all applicable laws and
regulations;
(d) use its best efforts to register or qualify the Registrable
Securities under all applicable state securities or "blue sky" laws of such
jurisdictions as any Holder of Registrable Securities covered by a Registration
Statement and each underwriter of an underwritten offering of Registrable
Securities shall reasonably request by the time the applicable Registration
Statement is declared effective by the Commission, and do any and all other acts
and things which may be reasonably necessary or advisable to enable such Holder
and underwriter to consummate the disposition in each such jurisdiction of such
Registrable Securities owned by such Holder; PROVIDED, HOWEVER, that the Company
shall not be required to (i) qualify as a foreign partnership or foreign
corporation or as a dealer in securities in any jurisdiction where it would not
otherwise be required to qualify but for this Section 3(d), (ii) file any
general consent to service of process in any jurisdiction where it would not
otherwise be subject to such service of process or (iii) subject itself to
taxation in any such jurisdiction if it is not then so subject;
(e) in the case of (A) a Shelf Registration or (B) Participating
Broker-Dealers who have notified the Company that they will be utilizing the
Prospectus contained in the Exchange Offer Registration Statement as provided in
Section 3(t) hereof, are seeking to sell Exchange Notes and are required to
deliver Prospectuses, notify each Holder, or such Participating Broker-Dealers,
as the case may be, their counsel and the managing underwriters, if any,
promptly and, if requested by such Holder or Participating Broker-Dealer,
confirm such notice in writing (i) when a Registration Statement has become
effective and when any post-effective amendments and supplements thereto become
effective, (ii) of any request by the Commission or any state securities
authority for amendments and supplements to a Registration Statement or
Prospectus or for additional information after the Registration Statement has
become effective, (iii) of the issuance by the Commission or any state
securities authority of any stop order suspending the effectiveness of a
Registration Statement or the initiation of any proceedings for that purpose,
(iv) in the case of a Shelf Registration, if, between the effective date of a
Registration Statement and the closing of any sale of Registrable Securities
covered thereby, the representations and warranties of the Company contained in
any underwriting agreement, securities sales agreement or other similar
agreement, if any, relating to such offering cease to be true and correct in all
material respects, (v) if the Company receives any notification with respect to
the suspension of the qualification
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of the Registrable Securities or the Exchange Notes to be sold by any
Participating Broker-Dealer for offer or sale in any jurisdiction or the
initiation of any proceeding for such purpose, (vi) of the happening of any
event or the failure of any event to occur or the discovery of any facts or
otherwise, during the period a Shelf Registration Statement is effective or the
Applicable Period, as the case may be, which makes any statement made in the
Shelf Registration Statement, the Exchange Offer Registration Statement or any
related Prospectus untrue in any material respect or which causes such
Registration Statement or Prospectus, as the case may be, to omit to state a
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading and (vii) of the
Company's reasonable determination that a post-effective amendment to the
Registration Statement would be appropriate;
(f) use its best efforts to obtain the withdrawal of any order
suspending the effectiveness of a Registration Statement at the earliest
possible moment;
(g) in the case of a Shelf Registration, furnish to each Holder, upon
request and without charge, at least one conformed copy of each Registration
Statement and any post-effective amendment thereto (without documents
incorporated therein by reference or exhibits thereto, unless requested);
(h) in the case of a Shelf Registration, cooperate with the selling
Holders to facilitate the timely preparation and delivery of certificates, if
any, representing Registrable Securities to be sold, which certificates shall
not bear any restrictive legends and shall be in a form eligible for deposit
with the Depositary; and cause such Registrable Securities to be in such
denominations (consistent with the provisions of the Indenture) and registered
in such names as the selling Holders or the managing underwriters may reasonably
request at least two business days prior to the closing of any sale of
Registrable Securities;
(i) subject to Section 3(a) hereof and the second paragraph of
Section 2(e) hereof, in the case of a Shelf Registration or an Exchange Offer
Registration, upon the occurrence of any circumstance contemplated by Section
3(e)(ii), 3(e)(iii), 3(e)(iv), 3(e)(v), 3(e)(vi) or 3(e)(vii) hereof, use its
best efforts to prepare a supplement or post-effective amendment to the
Registration Statement and the related Prospectus or any document incorporated
therein by reference or file any other required document so that, as thereafter
delivered to the purchasers of the Registrable Securities, such Prospectus will
not contain any untrue statement of a material fact or omit to state a material
fact necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading. The Company agrees to notify each
Holder to suspend use of the Prospectus as promptly as practicable after the
occurrence of any such circumstance, and each Holder hereby agrees to suspend
use of the Prospectus until the Company has amended or supplemented the
Prospectus to correct such misstatement or omission;
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(j) in the case of a Shelf Registration, furnish to each Holder of
Registrable Securities, upon request and without charge, a reasonable number of
copies of any document which is incorporated by reference into or is an exhibit
to a Registration Statement or a Prospectus after the initial filing of a
Registration Statement;
(k) obtain a CUSIP number for all Exchange Notes or Registrable
Securities, as the case may be, not later than the effective date of a
Registration Statement, and provide the Trustee with printed certificates for
the Exchange Notes or the Registrable Securities, as the case may be, in a form
eligible for deposit with the Depositary;
(l) cause the Indenture to be qualified under the TIA in connection
with the registration of the Exchange Notes or Registrable Securities, as the
case may be, cooperate with the Trustee and the Holders to effect such changes
to the Indenture as may be required for the Indenture to be so qualified in
accordance with the terms of the TIA and execute, and use its best efforts to
cause the Trustee to execute, all documents as may be required to effect such
changes, and all other forms and documents required to be filed with the
Commission to enable the Indenture to be so qualified in a timely manner;
(m) in the case of a Shelf Registration, enter into such agreements
(including underwriting agreements) as are customary in underwritten public
offerings and take all such other appropriate actions as are reasonably
requested in order to expedite or facilitate the registration or the disposition
of such Registrable Securities, 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
Holders of such Registrable Securities and the underwriters (if any), with
respect to the business of the Company and its subsidiaries and the Registration
Statement, the Prospectus and all documents, if any, incorporated or deemed to
be incorporated by reference therein, in each case, as are customarily made by
issuers to underwriters in underwritten public offerings, and confirm the same
if and when reasonably requested; (ii) obtain customary opinions of counsel to
the Company and updates thereof in form and substance reasonably satisfactory to
the managing underwriters (if any) and the Holders of a majority in principal
amount of the Registrable Securities being sold, addressed to each selling
Holder and the underwriters (if any) covering the matters customarily covered in
opinions requested in underwritten public offerings and such other matters as
may be reasonably requested by such Holders and underwriters; (iii) obtain "cold
comfort" letters and updates thereof in form and substance 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
or to be acquired by the Company for which financial statements and financial
data are, or are required to be, included in the Registration Statement),
addressed to the selling Holders of Registrable Securities and to each of the
underwriters, such letters to be in customary
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form and covering matters of the type customarily covered in "cold comfort"
letters in connection with underwritten public offerings; and (iv) if an
underwriting agreement is entered into, cause the same to contain
indemnification provisions and procedures no less favorable than those set forth
in Section 4 hereof (or such other provisions and procedures acceptable to
Holders of a majority in aggregate principal amount of Registrable Securities
covered by such Registration Statement and the managing underwriters or agents)
with respect to all parties to be indemnified pursuant to said Section. The
above shall be done at each closing under such underwriting agreement, or as and
to the extent required thereunder;
(n) if (A) a Shelf Registration is filed pursuant to Section 2(b) or
(B) a Prospectus contained in an Exchange Offer Registration Statement filed
pursuant to Section 2(a) is required to be delivered under the 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 Securities being sold, or each such Participating Broker-Dealer, as
the case may be, any underwriter participating in any such disposition of
Registrable Securities, if any, and any attorney, accountant or other agent
retained by any such selling Holder or each such Participating Broker-Dealer, 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, pertinent corporate documents and properties 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 in each case reasonably requested by any such Inspector
in connection with such Registration Statement. Records which the Company
determines, in good faith, to be confidential and as to which they notify the
Inspectors are confidential shall not be disclosed by the Inspectors unless,
after prior consultation with the Company, (i) the disclosure of such Records is
necessary to avoid or correct a material misstatement or omission in such
Registration Statement, (ii) the release of such Records is ordered pursuant to
an effective subpoena or other order from a court of competent jurisdiction or
(iii) the information in such Records has been made generally available to the
public, other than as a result of a breach of confidentiality or secrecy to the
Company. Each selling Holder of such Registrable Securities 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, other
than as a result of a breach of confidentiality or secrecy to the Company. Each
selling Holder of such Registrable Securities 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 or is
otherwise required upon the written advice of counsel to such Participating
Broker-Dealer, give notice to the Company and allow the Company at its expense
to undertake appropriate action to prevent disclosure of the Records deemed
confidential;
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(o) comply with all applicable rules and regulations of the
Commission and, as soon as reasonably practicable, make generally available to
the Holders earnings statements of the Company covering at least twelve (12)
months satisfying the provisions of Section 11(a) of the Act and Rule 158
thereunder (or any similar rule promulgated under the Act);
(p) upon consummation of an Exchange Offer or a Private Exchange,
obtain an opinion of counsel to the Company addressed to the Trustee for the
benefit of all Holders of Registrable Securities participating in the Exchange
Offer or the Private Exchange, as the case may be, and which includes an opinion
that (i) the Company has duly authorized, executed and delivered the Exchange
Notes and Private Exchange Notes and the Indenture, as the case may be, and (ii)
each of the Exchange Notes or the Private Exchange Notes and the Indenture, as
the case may be, constitute a legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its respective terms
(in each case, with customary exceptions);
(q) if an Exchange Offer or a Private Exchange is to be consummated,
upon delivery of the Registrable Securities by 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
cause to be marked, on such Registrable Securities delivered by such Holders
that such Registrable Securities are being canceled in exchange for the Exchange
Notes or the Private Exchange Notes, as the case may be; in no event shall such
Registrable Securities be marked as paid or otherwise satisfied;
(r) cooperate with each seller of Registrable Securities covered by
any Registration Statement and each underwriter, if any, participating in the
disposition of such Registrable Securities and their respective counsel in
connection with any filings required to be made with the NASD;
(s) use its best efforts to take all other steps necessary to effect
the registration of the Registrable Securities covered by a Registration
Statement contemplated hereby;
(t) (A) in the case of the Exchange Offer Registration Statement (i)
include in the Exchange Offer Registration Statement a section entitled "PLAN OF
DISTRIBUTION," which section shall be reasonably acceptable to the Initial
Purchasers or another representative of the Participating Broker-Dealers, and
which shall contain a summary statement of the positions taken or policies made
by the staff of the Commission with respect to the potential "underwriter"
status of any broker-dealer (a "PARTICIPATING BROKER-DEALER") that holds
Registrable Securities acquired for its own account as a result of market-making
activities or other trading activities and that will be the beneficial owner (as
defined in Rule 13d-3 under the Exchange Act) of Exchange Notes to be received
by such broker-dealer in the Exchange Offer, whether such positions or policies
have been publicly disseminated by the staff of the Commission or such
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positions or policies, in the reasonable judgment of the Initial Purchasers or
such other representative, represent the prevailing views of the staff of the
Commission, including a statement that any such broker-dealer who receives
Exchange Notes for Registrable Securities pursuant to the Exchange Offer may be
deemed a statutory underwriter and must deliver a prospectus meeting the
requirements of the Act in connection with any resale of such Exchange Notes,
(ii) furnish to each Participating Broker-Dealer who has delivered to the
Company the notice referred to in Section 3(e), without charge, as many copies
of each Prospectus included in the Exchange Offer Registration Statement,
including any preliminary prospectus, and any amendment or supplement thereto,
as such Participating Broker-Dealer may reasonably request, (iii) subject to the
last paragraph of this Section 3, hereby consent to the use of the Prospectus
forming part of the Exchange Offer Registration Statement or any amendment or
supplement thereto, by any Person subject to the prospectus delivery
requirements of the Commission, including all Participating Broker-Dealers, in
connection with the sale or transfer of the Exchange Notes covered by the
Prospectus or any amendment or supplement thereto, (iv) use its best efforts to
keep the Exchange Offer Registration Statement effective and to amend and
supplement the Prospectus contained therein, in order to permit such Prospectus
to be lawfully delivered by all Persons subject to the prospectus delivery
requirements of the Act for such period of time as such Persons must comply with
such requirements in order to resell the Exchange Notes (PROVIDED, HOWEVER, that
such period shall not be required to exceed 180 days, or such longer period if
extended pursuant to the last sentence of this Section 3 (the "APPLICABLE
PERIOD")), and (v) include in the transmittal letter or similar documentation to
be executed by an exchange offeree all necessary information for such offeree to
participate in the Exchange Offer;
(B) in the case of any Exchange Offer Registration Statement, the
Company agrees to deliver to the Initial Purchasers or to another representative
of the Participating Broker-Dealers on behalf of the Participating
Broker-Dealers upon consummation of the Exchange Offer (i) an opinion of counsel
substantially in the form attached hereto as EXHIBIT A, (ii) an Officer's
Certificate containing certifications substantially similar to those set forth
in Section 8(d) of the Purchase Agreement and such additional certifications as
are customarily delivered in a public offering of debt securities, and (iii) a
comfort letter in customary form permitted by Statement of Auditing Standards
No. 72 of the American Institute of Certified Public Accountants.
The Company may require each seller of Registrable Securities as to which
any registration is being effected to furnish to the Company such information
regarding such seller and the proposed distribution of such Registrable
Securities as the Company may from time to time reasonably request in writing.
The Company may exclude from such registration the Registrable Securities of any
seller who unreasonably fails to furnish such information within a reasonable
time after receiving such request.
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In the case of (i) a Shelf Registration Statement or (ii) Participating
Broker-Dealers who have notified the Company that they will be utilizing the
Prospectus contained in the Exchange Offer Registration Statement as provided in
Section 3(t) hereof, are seeking to sell Exchange Notes and are required to
deliver copies of such Prospectus, each Holder agrees that, upon receipt of any
notice from the Company of the happening of any event of the kind described in
Section 3(e)(ii), 3(e)(iii), 3(e)(iv), 3(e)(v), 3(e)(vi) or 3(e)(vii) hereof,
such Holder will forthwith discontinue disposition of Registrable Securities
pursuant to a Registration Statement until such Holder's receipt of the copies
of the supplemented or amended Prospectus contemplated by Section 3(i) hereof or
until it is advised in writing by the Company that the use of the applicable
Prospectus may be resumed, and, if so directed by the Company, such Holder will
deliver to the Company (at the Company's expense) all copies in such Holder's
possession, other than permanent file copies then in such Holder's possession,
of the Prospectus covering such Registrable Securities or Exchange Notes, as the
case may be, current at the time of receipt of such notice. If the Company shall
give any such notice to suspend the disposition of Registrable Securities or
Exchange Notes, as the case may be, pursuant to a Registration Statement, the
Company shall use its best efforts to file and have declared effective (if an
amendment) as soon as practicable an amendment or supplement to the Registration
Statement and shall extend the period during which such Registration Statement
shall be maintained effective pursuant to this Agreement by the number of days
in the period from and including the date of the giving of such notice to and
including the date when the Company shall have made available to the Holders
copies of the supplemented or amended Prospectus necessary to resume such
dispositions or shall have advised the Holders in writing that the use of the
applicable Prospectus may be resumed.
4. INDEMNIFICATION AND CONTRIBUTION. (a) The Company shall indemnify and
hold harmless the Initial Purchasers, each Holder, each Participating
Broker-Dealer, each underwriter who participates in an offering of Registrable
Securities, each of their respective affiliates, each Person, if any, who
controls any of such parties within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act, and each of their respective directors,
officers, partners, employees, representatives and agents, to the fullest extent
lawful as follows:
(i) from and against any and all loss, liability, claim, damage and
expense whatsoever, joint or several, as incurred, arising out of any
untrue statement or alleged untrue statement of a material fact contained
in any Registration Statement or any amendment thereto pursuant to which
the offer and sale of the Registrable Securities or Exchange Notes were
registered under the Act including all documents incorporated therein by
reference, or the omission or alleged omission therefrom of a material fact
required to be stated therein or necessary to make the statements therein
not misleading, or arising out of any untrue statement or alleged untrue
statement of a material fact contained in any Prospectus or any amendment
or supplement thereto, or the omission or alleged
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omission therefrom of a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading;
(ii) from and against any and all loss, liability, claim, damage and
expense whatsoever, joint or several, to the extent of the aggregate amount
paid in settlement of any litigation, or any investigation or proceeding by
any court or governmental agency or body, whether commenced or threatened,
or any claim whatsoever based upon any such untrue statement or omission,
or any such alleged untrue statement or omission, if and only if such
settlement is effected with the prior written consent of the Company; and
(iii) from and against any and all expenses whatsoever (including
reasonable fees and disbursements of counsel chosen by the Initial
Purchasers, Holder, Participating Broker-Dealer or underwriter (except to
the extent otherwise expressly provided in Section 4(c) hereof)), as
incurred, reasonably incurred in investigating, preparing for or defending
against any litigation, or any investigation or proceeding by any court or
governmental agency or body, whether commenced or threatened, or any other
claim whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such
expense is not paid under subparagraph (i) or (ii) of this Section 4(a);
PROVIDED, HOWEVER, that this indemnity does not apply to any loss, liability,
claim, damage or expense to the extent arising out of an untrue statement or
omission or alleged untrue statement or omission (i) made solely in reliance
upon and in conformity with written information furnished to the Company by the
Initial Purchasers, such Holder, such Participating Broker-Dealer or any
underwriter in writing expressly for use in the Registration Statement (or any
amendment thereto) or any Prospectus (or any amendment or supplement thereto) or
(ii) contained in any preliminary prospectus or any Prospectus if the Initial
Purchasers, such Holder, such Participating Broker-Dealer or such underwriter
failed to send or deliver a copy of the Prospectus (as then amended or
supplemented if the Company shall have timely furnished any amendments or
supplements thereto) to the Person asserting such losses, liabilities, claims or
damages on or prior to the delivery of written confirmation of any sale of
securities covered thereby to such Person in any case where such delivery is
required by the Act and such Prospectus (as so amended or supplemented) would
have corrected such untrue statement or omission and the delivery thereof would
have eliminated such losses, claims, damages or liabilities. Any amounts
advanced by the Company to an indemnified party pursuant to this Section 4 as a
result of such losses shall be returned to the Company if it shall be finally,
judicially determined by a court of competent jurisdiction that such indemnified
party was not entitled to indemnification by the Company pursuant to this
Section 4.
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(b) Each Holder agrees, severally and not jointly, to indemnify and
hold harmless the Company, the Initial Purchasers, each underwriter who
participates in an offering of Registrable Securities and the other selling
Holders and each of their respective directors, officers (including each officer
of the Company who signed the Registration Statement), employees,
representatives and agents, and each Person, if any, who controls the Company,
the Initial Purchasers, any underwriter or any other selling Holder within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act, from and
against any and all loss, liability, claim, damage and expense whatsoever
described in the indemnity contained in Section 4(a) hereof, as reasonably
incurred, but only with respect to untrue statements or omissions, or alleged
untrue statements or omissions, made in the Registration Statement (or any
amendment thereto) or any Prospectus (or any amendment or supplement thereto)
solely in reliance upon and in conformity with written information furnished to
the Company by such selling Holder expressly for use in the Registration
Statement (or any amendment thereto) or any such Prospectus (or any amendment or
supplement thereto); PROVIDED, HOWEVER, that, in the case of a Shelf
Registration Statement, no such Holder shall be liable for any claims hereunder
in excess of the amount of net proceeds received by such Holder from the sale of
Registrable Securities pursuant to such Shelf Registration Statement.
(c) Each indemnified party shall give prompt notice to each
indemnifying party of any action in respect of which indemnity may be sought
hereunder, enclosing a copy of all papers properly served on such indemnified
party (but failure to notify an indemnifying party shall not relieve such
indemnifying party from any liability hereunder to the extent it is not
materially prejudiced as a result thereof and in any event shall not relieve it
from any liability which it may have other than on account of this indemnity
agreement). An indemnifying party may participate, at its own expense, in the
defense of any such action. If an indemnifying party so elects within a
reasonable time after receipt of such notice, such indemnifying party, jointly
with any other indemnifying party, may assume the defense of such action with
counsel chosen by it and reasonably satisfactory to the indemnified parties
defendant in such action; PROVIDED, HOWEVER, that if any such indemnified party
reasonably determines, upon written advice of counsel, that there may be legal
defenses available to such indemnified party which are different from or in
addition to those available to such indemnifying party or that representation of
such indemnifying party and any indemnified party by the same counsel would
present a conflict of interest, then one additional counsel in each jurisdiction
for all indemnified parties having consistent interests and such different or
additional defenses or subject to such conflict shall be entitled to conduct the
defense of such indemnified parties with the fees and expenses of such counsel
to be borne by the indemnifying party or parties. If an indemnifying party
assumes the defense of an action in accordance with and as permitted by the
provisions of this Section 4(c), such indemnifying party shall not be liable for
any fees and expenses of counsel for the indemnified parties incurred thereafter
in connection with such action (except to the extent set forth in the proviso
contained in the immediately preceding sentence). In no event shall the
indemnifying party or parties be liable for the fees and expenses of more than
one counsel for all indemnified parties in
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connection with any one action, or separate but similar or related actions in
the same jurisdiction arising out of the same general allegations or
circumstances. No indemnifying party shall, without the prior written consent of
the indemnified parties, which consent shall not be unreasonably withheld,
settle or compromise or consent to the entry of any judgment with respect to any
litigation, or any investigation or proceeding by any governmental agency or
body, commenced or threatened, or any claim whatsoever in respect of which
indemnification or contribution could be sought under this Section 4, unless
such settlement, compromise or consent includes an unconditional release of each
indemnified party from all liability arising out of such litigation,
investigation, proceeding or claim and does not include a statement as to or an
admission of fault, culpability or a failure to act by or on behalf of any
indemnified party.
(d) Notwithstanding any payment or payments made by the Company
hereunder, the Company hereby expressly waives subrogation to, and agrees that
it shall not be entitled to be subrogated to, any of the rights of any
indemnified party against the Company or any other right of offset held by any
indemnified party for the payment of any amounts owed to any indemnified party
pursuant to this Section 4; PROVIDED, HOWEVER, that if any of the foregoing
provisions of this paragraph are held to be contrary to applicable law or
unenforceable by a court of competent jurisdiction, the Company hereby expressly
agrees that any right of subrogation or contribution that the Company may have
as a result of such applicable law or unenforceability, as the case may be,
shall be subordinate in right of payment to the payment in full in cash of all
amounts owed to any indemnified party pursuant to this Section 4.
(e) If the indemnification provided for in this Section 4 is for any
reason unavailable to or insufficient to hold harmless an indemnified party in
respect of any losses, liabilities, claims, damages or expenses referred to
herein, then each indemnifying party shall contribute to the aggregate amount of
such losses, liabilities, claims, damages and expenses incurred by such
indemnified party, as incurred, (i) in such proportion as is appropriate to
reflect the relative benefits received by the indemnifying party or parties on
the one hand and the indemnified party or parties on the other hand from the
offering of the Notes pursuant to the Purchase Agreement, or (ii) if the
allocation provided by clause (i) is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of the indemnifying party or
parties on the one hand and of the indemnified party or parties on the other
hand in connection with the statements or omissions which resulted in such
losses, liabilities, claims, damages or expenses, as well as any other relevant
equitable considerations.
The relative benefits received by the Company on the one hand and the
Initial Purchasers on the other hand in connection with the offering of the
Notes pursuant to the Purchase Agreement shall be deemed to be in the same
respective proportions as the total net proceeds from the offering of the Notes
pursuant to the Purchase Agreement
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(before deducting expenses) received by the Company and the total discount
received by the Initial Purchasers bear to the aggregate initial offering price
of the Notes.
The relative fault of the Company on the one hand and the Holders on the
other hand shall be determined by reference to, among other things, whether any
such untrue or alleged untrue statement of a material fact or omission or
alleged omission to state a material fact relates to information supplied by the
Company or by the Holders, and the respective parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Company and the Holders agree that it would not be just and equitable
if contribution pursuant to this Section 4 were determined by pro rata
allocation (even if the Holders were treated as one entity for such purpose) or
by any other method of allocation which does not take account of the equitable
considerations referred to above in this Section 4(e). The aggregate amount of
losses, liabilities, claims, damages and expenses incurred by an indemnified
party and referred to above in this Section 4(e) shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified party in
investigating, preparing for or defending against any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever based upon any untrue or alleged untrue
statement or omission or alleged omission referred to in Section 4(a)(i).
Notwithstanding the provisions of this Section 4(e), no Initial Purchaser
shall be required to contribute any amount in excess of the amount by which the
total discount received by such Initial Purchaser in respect of the purchase
price of the Notes purchased by it from the Company exceeds the amount of any
damages which such Initial Purchaser has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission.
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Act) shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation.
For purposes of this Section 4(c), each person, if any, who controls an
Initial Purchaser, a Holder, a Participating Broker-Dealer, an underwriter who
participates in an offering of Registrable Securities, or the affiliates of any
of them, within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act shall have the same rights to contribution as the Initial
Purchasers, and each director, officer (including each officer of the Company
who signed the Registration Statement), partner, employee, representative and
agent of the Company, the Initial Purchasers, each Holder, each Participating
Broker-Dealer, and each underwriter who participates in an offering of
Registrable Securities and each person, if any, who controls the Company within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act shall
have the same rights to contribution as the Company.
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5. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS. No Holder may participate
in any underwritten registration hereunder unless such Holder (a) agrees to sell
such Holder's Registrable Securities on the basis provided in any customary
underwriting arrangements approved by the Holders of a majority in aggregate
principal amount of the Registrable Securities included in such offering and (b)
completes and executes all reasonable questionnaires, powers of attorney,
indemnities, underwriting agreements, lock-up letters and other documents
reasonably required in connection with such underwriting arrangements.
6. SELECTION OF UNDERWRITERS. In any underwritten offering, the
underwriter or underwriters and manager or managers that will administer the
offering will be selected by the Holders of a majority in aggregate principal
amount of the Registrable Securities included in such offering; PROVIDED,
HOWEVER, that such underwriters and managers must be reasonably satisfactory to
the Company.
7. MISCELLANEOUS.
(a) NO INCONSISTENT AGREEMENTS. The Company has not entered into nor
will the Company on or after the date of this Agreement enter into any agreement
that is inconsistent with the rights granted to the Holders of Registrable
Securities in this Agreement or otherwise conflicts with the provisions hereof.
(b) AMENDMENTS AND WAIVERS. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, unless the Company has obtained the written consent of the
Majority Holders; provided, however, that no amendment, modification or
supplement or waiver or consent to the departure with respect to the provisions
of Section 4 hereof shall be effective as against any Holder of Registrable
Securities unless consented to in writing by such Holder of Registrable
Securities.
(c) NOTICES. All notices and other communications hereunder shall be
in writing and shall be deemed to have been duly given if sent by registered or
certified mail, postage prepaid, sent by any national courier service
guaranteeing overnight delivery or transmitted by any standard form of
telecommunication, as follows: (i) if to a Holder, at the most current address
given by such Holder to the Company in accordance with the provisions of this
Section 7(c), which address, with respect to an Initial Purchaser, shall
initially be the address provided for such Initial Purchaser in the Purchase
Agreement; and (ii) if to the Company, at its address as set forth in the
Purchase Agreement, or at such other address provided in accordance with the
provisions of this Section 7(c).
All such notices and communications shall be deemed to have been duly given
at the earlier of: (i) the time of actual receipt by the addressee; or (ii) the
time delivered, if personally delivered, or five (5) business days after being
sent by registered
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or certified mail, postage prepaid, if mailed, or when answered back, if
telexed, or when transmission is confirmed, if telecopied, or on the next
business day, if timely delivered to a national courier service guaranteeing
overnight delivery.
Copies of all notices, demands, or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at its
address specified in the Indenture.
(d) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit
of and be binding upon the successors, assigns and transferees of the Initial
Purchasers, including, without limitation and without the need for an express
assignment, subsequent Holders; PROVIDED, HOWEVER, that nothing herein shall be
deemed to permit any assignment, transfer or other disposition of Registrable
Securities in violation of the terms of the Purchase Agreement or the Indenture.
If any transferee of any Holder shall acquire Registrable Securities, in any
manner, whether by operation of law or otherwise, such Registrable Securities
shall be held subject to all of the terms of this Agreement, and by taking and
holding such Registrable Securities, such Person shall be conclusively deemed to
have agreed to be bound by and to perform all of the terms and provisions of
this Agreement and such Person shall be entitled to receive the benefits hereof.
(e) THIRD PARTY BENEFICIARY. The Holders shall be third party
beneficiaries of the agreements made hereunder between the Company, on the one
hand, and the Initial Purchasers, on the other hand, and the Holders shall have
the right to enforce such agreements directly to the extent they deem such
enforcement necessary or advisable to protect their rights or the rights of any
of the other Holders.
(f) HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(g) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING
EFFECT TO ANY PROVISIONS RELATING TO CONFLICTS OF LAWS.
(h) SEVERABILITY. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
(i) NOTES HELD BY THE COMPANY OR ITS AFFILIATES. Whenever the consent
or approval of Holders of a specified percentage of Registrable Securities is
required hereunder, Registrable Securities held by the Company or any affiliate
of the Company (as such term is defined in Rule 405 under the Act) shall not be
counted in
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determining whether such consent or approval was given by the Holders of such
required percentage.
(j) COUNTERPARTS. This Agreement may be executed in one or more
counterparts and, when so executed, all such counterparts taken together shall
constitute one and the same agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
NORTEK, INC.
By: /s/ Xxxxx X. Xxxxxxxx
------------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Vice President, General
Counsel and Secretary
BEAR, XXXXXXX & CO. INC.
By: /s/ Xxxxx Xxxx
--------------------------------
Name: Xxxxx Xxxx
Title: Senior Managing Director
DRESDNER KLEINWORT XXXXXXXXXXX -- GRANTCHESTER, INC.
By: /s/ Xxxxxxxxxxx X. Xxxxxxxx
--------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxxx
Title: Vice President and Controller
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EXHIBIT A
FORM OF OPINION OF COUNSEL
1. Each of the Exchange Offer Registration Statement and the Prospectus
(other than the financial statements, notes or schedules thereto and other
financial and statistical data and supplemental schedules included or referred
to therein or omitted therefrom and the Form T-1, as to which such counsel need
express no opinion), complies as to form in all material respects with the
applicable requirements of the Act and the applicable rules and regulations
promulgated under the Act.
2. In the course of such counsel's review and discussion of the contents
of the Exchange Offer Registration Statement and the Prospectus with certain
officers and other representatives of the Company and representatives of the
independent certified public accountants of the Company, but without independent
check or verification or responsibility for the accuracy, completeness or
fairness of the statements contained therein, on the basis of the foregoing
(relying as to materiality to a large extent upon representations and opinions
of officers and other representatives of the Company), no facts have come to
such counsel's attention which cause such counsel to believe that the Exchange
Offer Registration Statement (other than the financial statements, notes and
schedules thereto and other financial and statistical information contained or
referred to therein and the Form T-1, as to which such counsel need express no
belief), at the time the Exchange Offer Registration Statement became effective,
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements contained
therein not misleading, or that the Prospectus (other than the financial
statements, notes and schedules thereto and other financial and statistical
information contained or referred to therein, as to which such counsel need
express no belief) contains any untrue statement of a material fact or omits to
state a material fact necessary to make the statements contained therein, in
light of the circumstances under which they were made, not misleading.
2
