Exhibit 10.2
ALEC HOLDINGS, INC.
$46,928,435.00
Senior Discount Debentures due 2011
EXCHANGE AND REGISTRATION RIGHTS AGREEMENT
May 14, 1999
DLJ Investment Partners, L.P.
DLJ Investment Funding, Inc.
DLJ ESC II L.P.
c/o DLJ Investment Partners, Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
ALEC Holdings, Inc., a Delaware corporation (the "Holdings"),
proposes to issue and sell to DLJ Investment Partners, L.P., DLJ Investment
Funding, Inc. and DLJ ESC II L.P. (together, the "Initial Purchasers"), upon the
terms and subject to the conditions set forth in a purchase agreement dated May
11, 1999 (the "Purchase Agreement"), $46,928,435.00 aggregate principal amount
of its Senior Discount Debentures due 2011 (the "Debentures"). Capitalized terms
used but not defined herein shall have the meanings given to such terms in the
Purchase Agreement.
As an inducement to the Initial Purchasers to enter into the
Purchase Agreement and in satisfaction of a condition to the obligations of the
Initial Purchasers thereunder, Holdings agrees with the Initial Purchasers, for
the benefit of the holders (including the Initial Purchasers) of the Debentures,
the Exchange Debentures (as defined herein) and the Private Exchange Debentures
(as defined herein) (collectively, the "Holders"), as follows:
1. Registered Exchange Offer. Holdings shall (i) prepare and, not
later than 75 days following the date of original issuance of the Debentures
(the "Issue Date"), file with the Commission a registration statement (the
"Exchange Offer Registration Statement") on an appropriate form under the
Securities Act with respect to a proposed offer to the Holders of the Debentures
(the "Registered Exchange Offer") to issue and deliver to such Holders, in
exchange for the Debentures, a like aggregate principal amount of deben-
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tures of Holdings (the "Exchange Debentures") that are identical in all material
respects to the Debentures, except for the transfer restrictions relating to the
Debentures, (ii) use their reasonable best efforts to cause the Exchange Offer
Registration Statement to become effective under the Securities Act no later
than 150 days after the Issue Date and the Registered Exchange Offer to be
consummated no later than 180 days after the Issue Date and (iii) keep the
Exchange Offer Registration Statement effective for not less than 30 days (or
longer, if required by applicable law) after the date on which notice of the
Registered Exchange Offer is mailed to the Holders (such period being called the
"Exchange Offer Registration Period"). The Exchange Debentures will be issued
under the Indenture or an indenture (the "Exchange Debentures Indenture")
between Holdings and the Trustee or such other bank or trust company that is
reasonably satisfactory to the Initial Purchasers, as trustee (the "Exchange
Debentures Trustee"), such indenture to be identical in all material respects to
the Indenture, except for the transfer restrictions relating to the Debentures
(as described above).
Upon the effectiveness of the Exchange Offer Registration Statement,
Holdings shall promptly commence the Registered Exchange Offer, it being the
objective of such Registered Exchange Offer to enable each Holder electing to
exchange Debentures for Exchange Debentures (assuming that such Holder (a) is
not an affiliate of Holdings or an Exchanging Dealer (as defined herein) not
complying with the requirements of the next sentence, (b) is not an Initial
Purchaser holding Debentures that have, or that are reasonably likely to have,
the status of an unsold allotment in an initial distribution, (c) acquires the
Exchange Debentures in the ordinary course of such Xxxxxx's business and (d) has
no arrangements or understandings with any person to participate in the
distribution of the Exchange Debentures) and to trade such Exchange Debentures
from and after their receipt without any limitations or restrictions under the
Securities Act and without material restrictions under the securities laws of
the several states of the United States. Holdings, the Initial Purchasers and
each Exchanging Dealer acknowledge that, pursuant to current interpretations by
the Commission's staff of Section 5 of the Securities Act, (i) each Holder that
is a broker-dealer electing to exchange Debentures acquired for its own account
as a result of market-making activities or other trading activities, for
Exchange Debentures (an "Exchanging Dealer"), is required to deliver a
prospectus containing substantially the information set forth in Annex A hereto
on the cover, in Annex B hereto in the "Exchange Offer Procedures" section and
the "Purpose of the Exchange Offer" section and in Annex C hereto in the "Plan
of Distribution" section of such prospectus in connection with a sale of any
such Exchange Debentures received by such Exchanging Dealer pursuant to the
Registered Exchange Offer and (ii) if the Initial Purchasers elect to sell
Exchange Debentures acquired in exchange for Debentures constituting any portion
of an unsold allotment, the Initial Purchasers will be required to deliver a
prospectus containing the information required
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by Items 507 and 508 of Regulation S-K under the Securities Act, as applicable,
in connection with such sale.
If, prior to the consummation of the Registered Exchange Offer, any
Holder holds any Debentures acquired by it that have, or that are reasonably
likely to be determined to have, the status of an unsold allotment in an initial
distribution, or any Holder is not entitled to participate in the Registered
Exchange Offer, Holdings shall, upon the request of any such Holder,
simultaneously with the delivery of the Exchange Debentures in the Registered
Exchange Offer, issue and deliver to any such Holder, in exchange for the
Debentures held by such Holder (the "Private Exchange"), a like aggregate
principal amount of debentures of Holdings (the "Private Exchange Debentures")
that are identical in all material respects to the Exchange Debentures, except
for the transfer restrictions relating to such Private Exchange Debentures. The
Private Exchange Debentures will be issued under the same indenture as the
Exchange Debentures, and Holdings shall use its reasonable best efforts to cause
the Private Exchange Debentures to bear the same CUSIP number as the Exchange
Debentures.
In connection with the Registered Exchange Offer, Holdings shall:
(a) 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;
(b) keep the Registered Exchange Offer open for not less than 30
days (or longer, if required by applicable law) after the date on which
notice of the Registered Exchange Offer is mailed to the Holders;
(c) utilize the services of a depositary for the Registered Exchange
Offer with an address in the Borough of Manhattan, The City of New York;
(d) permit Holders to withdraw tendered Debentures at any time prior
to the close of business, New York City time, on the last business day on
which the Registered Exchange Offer shall remain open; and
(e) otherwise comply in all material respects with all laws that are
applicable to the Registered Exchange Offer.
As soon as practicable after the close of the Registered Exchange
Offer and any Private Exchange, as the case may be, Holdings shall:
(a) accept for exchange all Debentures tendered and not validly
withdrawn pursuant to the Registered Exchange Offer and the Private
Exchange;
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(b) deliver to the Trustee for cancellation all Debentures so
accepted for exchange; and
(c) cause the Trustee or the Exchange Debentures Trustee, as the
case may be, promptly to authenticate and deliver to each Holder, Exchange
Debentures or Private Exchange Debentures, as the case may be, equal in
principal amount to the Debentures of such Holder so accepted for
exchange.
Holdings shall use its reasonable 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 used by
all persons subject to the prospectus delivery requirements of the Securities
Act for such period of time as such persons must comply with such requirements
in order to resell the Exchange Debentures; provided that (i) in the case where
such prospectus and any amendment or supplement thereto must be delivered by an
Exchanging Dealer, such period shall be the period beginning on the date on
which the Exchange Offer Registration Statement is declared effective and ending
on the earlier to occur of (x) the date that is 180 days after the date on which
the Exchange Offer Registration Statement is declared effective and (y) the date
on which all Exchanging Dealers have sold all Exchange Debentures held by them
and (ii) Holdings shall make such prospectus and any amendment or supplement
thereto available to any broker-dealer for use in connection with any resale of
any Exchange Debentures for a period of not less than 90 days after the
consummation of the Registered Exchange Offer.
The Indenture or the Exchange Debentures Indenture, as the case may
be, shall provide that the Debentures, the Exchange Debentures and the Private
Exchange Debentures shall vote and consent together on all matters as one class
and that none of the Debentures, the Exchange Debentures or the Private Exchange
Debentures will have the right to vote or consent as a separate class on any
matter.
Interest on each Exchange Debenture and Private Exchange Debenture
issued pursuant to the Registered Exchange Offer and in the Private Exchange
will accrue from the last interest payment date on which interest was paid on
the Debentures surrendered in exchange therefor or, if no interest has been paid
on the Debentures, from the Issue Date.
Each Holder participating in the Registered Exchange Offer shall be
required to represent to Holdings that at the time of the consummation of the
Registered Exchange Offer (i) any Exchange Debentures received by such Holder
will be acquired in the ordinary course of business, (ii) such Holder will have
no arrangements or understanding with any person to participate in the
distribution of the Debentures or the Exchange Debentures within the meaning of
the Securities Act and (iii) such Holder is not an affiliate of Holdings
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or, if it is such an affiliate, such Holder will comply with the registration
and prospectus delivery requirements of the Securities Act to the extent
applicable.
Notwithstanding any other provisions hereof, Holdings will ensure
that (i) any Exchange Offer Registration Statement and any amendment thereto and
any prospectus forming part thereof and any supplement thereto complies in all
material respects with the Securities Act and the rules and regulations of the
Commission thereunder, (ii) any Exchange Offer Registration Statement and any
amendment thereto does not, when it becomes effective, contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading and
(iii) any prospectus forming part of any Exchange Offer Registration Statement,
and any supplement to such prospectus, does not, as of the consummation of the
Registered Exchange Offer, include an untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading.
2. Shelf Registration. If (i) because of any change in law or the
applicable interpretations thereof by the Commission's staff Holdings is not
permitted to effect the Registered Exchange Offer as contemplated by Section 1
hereof, or (ii) any Debentures validly tendered pursuant to the Registered
Exchange Offer are not exchanged for Exchange Debentures on or prior to 180 days
after the Issue Date, or (iii) an Initial Purchaser so requests on or prior to
the 20th business day following the date on which the Registered Exchange Offer
is consummated with respect to Debentures or Private Exchange Debentures not
eligible to be exchanged for Exchange Debentures in the Registered Exchange
Offer and held by it following the consummation of the Registered Exchange
Offer, or (iv) any law or the applicable interpretations thereof by the
Commission's staff do not permit any Holder to participate in the Registered
Exchange Offer, or (v) any Holder who holds at least $1 million in principal
amount of Debentures that participates in the Registered Exchange Offer and does
not receive freely transferable Exchange Debentures in exchange for tendered
Debentures on or prior to the 20th business day following the date on which the
Registered Exchange Offer is consummated, or (vi) Holdings so elects, then the
following provisions shall apply:
(a) Holdings shall use its reasonable best efforts to file as
promptly as practicable (but in no event more than 45 days after so
required or requested pursuant to this Section 2) with the Commission, and
thereafter shall use its reasonable best efforts to cause to be declared
effective, a shelf registration statement on an appropriate form under the
Securities Act relating to the offer and sale of the Transfer Restricted
Debentures (as defined below) by the Holders thereof from time to time in
accordance with the methods of distribution set forth in such registration
statement (hereafter, a "Shelf Registration Statement" and, together with
any Exchange
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Offer Registration Statement, a "Registration Statement"); provided that
no Holder (other than the Initial Purchasers) shall be entitled to have
any Debentures held by such Holder covered by such Shelf Registration
Statement unless such Holder agrees in writing to be bound by the
provisions of this Agreement applicable to such Holder.
(b) Holdings shall use its reasonable best efforts to keep the Shelf
Registration Statement continuously effective in order to permit the
prospectus forming part thereof to be used by Holders of Transfer
Restricted Debentures for a period ending on the earlier of (i) two years
from the Issue Date or such shorter period that will terminate when all
the Transfer Restricted Debentures covered by the Shelf Registration
Statement have been sold pursuant thereto and (ii) the date on which the
Debentures become eligible for resale without volume restrictions pursuant
to Rule 144 under the Securities Act (in any such case, such period being
called the "Shelf Registration Period"). Holdings shall be deemed not to
have used its reasonable best efforts to keep the Shelf Registration
Statement effective during the requisite period if any of them voluntarily
take any action that results in Holders of Transfer Restricted Debentures
covered thereby not being able to offer and sell such Transfer Restricted
Debentures during that period, unless (i) such action is required by law
or the applicable interpretations thereof by the Commission's staff or
(ii) such action is taken by Holdings in good faith and for valid business
reasons (not including avoidance of their obligations hereunder), provided
that Holdings on or prior to 60 days thereafter comply with the
requirements of Section 4(j) hereof. Any such period during which Holdings
fails to keep the Shelf Registration Statement effective and usable for
offers and sales of Debentures, Private Exchange Debentures and Exchange
Debentures is referred to as a "Suspension Period". A Suspension Period
shall commence on and include the date Holdings gives notice that the
Shelf Registration Statement is no longer effective or the prospectus
included therein is no longer usable for offers and sales of Debentures,
Private Exchange Debentures and Exchange Debentures and shall end on the
date when each Holder of Debentures, Private Exchange Debentures and
Exchange Debentures covered by such Shelf Registration Statement either
receives copies of the supplemented or amended prospectus or other
document contemplated by Section 4(j) hereof or is advised in writing by
Holdings that use of the prospectus may be resumed. If more than one
Suspension Period occurs during any period of 360 consecutive days, then
Holdings will be obligated to pay Additional Amounts (as defined below),
in accordance with the provisions of Section 3, to each Holder of Transfer
Restricted Securities during each such Suspension Period in an amount
equal to $0.192 per week per $1,000 Accreted Value (as defined in the
Indenture) of Transfer Restricted Securities held by such Holder. If one
or more Suspension Periods occur, the two-year time period refer-
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enced above shall be extended by the number of days included in each such
Suspension Period.
(c) Notwithstanding any other provisions hereof, Holdings will
ensure that (i) any Shelf Registration Statement and any amendment thereto
and any prospectus forming part thereof and any supplement thereto
complies in all material respects with the Securities Act and the rules
and regulations of the Commission thereunder, (ii) any Shelf Registration
Statement and any amendment thereto (in either case, other than with
respect to information included therein in reliance upon or in conformity
with written information furnished to Holdings by or on behalf of any
Holder specifically for use therein (the "Holders' Information")) does not
contain an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein not misleading and (iii) any prospectus forming part of any Shelf
Registration Statement, and any supplement to such prospectus (in either
case, other than with respect to Holders' Information), does not include
an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
3. Liquidated Damages. (a) The parties hereto agree that the Holders
of Transfer Restricted Debentures will suffer damages if Holdings fails to
fulfill its obligations under Section 1 or Section 2, as applicable, and that it
would not be feasible to ascertain the extent of such damages. Accordingly, if
(i) the applicable Registration Statement is not filed with the Commission on or
prior to 75 days after the Issue Date, (ii) the Exchange Offer Registration
Statement or the Shelf Registration Statement, as the case may be, is not
declared effective on or prior to 150 days after the Issue Date (or in the case
of a Shelf Registration Statement required to be filed in response to a change
in law or the applicable interpretations of Commission's staff, if later, on or
prior to 60 days after publication of the change in law or interpretation),
(iii) the Registered Exchange Offer is not consummated on or prior to 180 days
after the Issue Date, or (iv) the Shelf Registration Statement is filed and
declared effective on or prior to 150 days after the Issue Date (or in the case
of a Shelf Registration Statement required to be filed in response to a change
in law or the applicable interpretations of Commission's staff, if later, on or
prior to 60 days after publication of the change in law or interpretation) but
shall thereafter cease to be effective (at any time that Holdings is obligated
to maintain the effectiveness thereof) without being succeeded within 45 days by
an additional Registration Statement filed and declared effective (each such
event referred to in clauses (i) through (iv), a "Registration Default"),
Holdings will be obligated to pay liquidated damages (collectively referred to
herein as "Additional Amounts") to each Holder of Transfer Restricted
Debentures, during the period of one or more such Registration Defaults, in an
amount equal to $ 0.192 per week per $1,000 Accreted Value
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of Transfer Restricted Debentures held by such Holder until (i) the applicable
Registration Statement is filed, (ii) the Exchange Offer Registration Statement
is declared effective and the Registered Exchange Offer is consummated, (iii)
the Shelf Registration Statement is declared effective or (iv) the Shelf
Registration Statement again becomes effective, as the case may be. Following
the cure of all Registration Defaults, the accrual of Additional Amounts will
cease. As used herein, the term "Transfer Restricted Debentures" means (i) each
Debenture until the date on which such Debenture has been exchanged for a freely
transferable Exchange Debenture in the Registered Exchange Offer, (ii) each
Debenture or Private Exchange Debenture until the date on which it has been
effectively registered under the Securities Act and disposed of in accordance
with the Shelf Registration Statement or (iii) each Debenture or Private
Exchange Debenture until the date on which it is distributed to the public
pursuant to Rule 144 under the Securities Act or is saleable pursuant to Rule
144(k) under the Securities Act. Notwithstanding anything to the contrary in
this Section 3(a), Holdings shall not be required to pay Additional Amounts to a
Holder of Transfer Restricted Debentures if such Holder failed to comply with
its obligations to make the representations set forth in the second to last
paragraph of Section 1 or failed to provide the information required to be
provided by it, if any, pursuant to Section 4(n).
(b) Holdings shall notify the Trustee and the Paying Agent under the
Indenture immediately upon the happening of each and every Registration Default.
Holdings shall pay the Additional Amounts due on the Transfer Restricted
Debentures by depositing with the Paying Agent (which may not be Holdings for
these purposes), in trust, for the benefit of the Holders thereof, prior to
10:00 a.m., New York City time, on the next interest payment date specified by
the Indenture and the Debentures, sums sufficient to pay the Additional Amounts
then due. The Additional Amounts due shall be payable on each interest payment
date specified by the Indenture and the Debentures to the record holder entitled
to receive the interest payment to be made on such date. Each obligation to pay
Additional Amounts shall be deemed to accrue from and including the date of the
applicable Registration Default.
(c) The parties hereto agree that the Additional Amounts provided
for in this Section 3 constitute a reasonable estimate of and are intended to
constitute the sole damages that will be suffered by Holders of Transfer
Restricted Debentures by reason of the failure of (i) the Shelf Registration
Statement or the Exchange Offer Registration Statement to be filed, (ii) the
Shelf Registration Statement to remain effective or (iii) the Exchange Offer
Registration Statement to be declared effective and the Registered Exchange
Offer to be consummated, in each case to the extent required by this Agreement.
4. Registration Procedures. In connection with any Registration
Statement, the following provisions shall apply:
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(a) Holdings shall (i) furnish to the Initial Purchasers, prior to
the filing thereof with the Commission, a copy of the Registration
Statement and each amendment thereof and each supplement, if any, to the
prospectus included therein and shall use its reasonable best efforts to
reflect in each such document, when so filed with the Commission, such
comments as the Initial Purchasers may reasonably propose; (ii) include
the information set forth in Annex A hereto on the cover, in Annex B
hereto in the "Exchange Offer Procedures" section and the "Purpose of the
Exchange Offer" section and in Annex C hereto in the "Plan of
Distribution" section of the prospectus forming a part of the Exchange
Offer Registration Statement, and include the information set forth in
Annex D hereto in the Letter of Transmittal delivered pursuant to the
Registered Exchange Offer; and (iii) if requested by any Initial
Purchaser, include the information required by Items 507 or 508 of
Regulation S-K, as applicable, in the prospectus forming a part of the
Exchange Offer Registration Statement.
(b) Holdings shall advise the Initial Purchasers, each Exchanging
Dealer and the Holders (if applicable) and, if requested by any such
person, confirm such advice in writing (which advice pursuant to clauses
(ii)-(v) hereof shall be accompanied by an instruction to suspend the use
of the prospectus until the requisite changes have been made):
(i) when any Registration Statement and any amendment thereto
has been filed with the Commission and when such Registration
Statement or any post-effective amendment thereto has become
effective;
(ii) of any request by the Commission for amendments or
supplements to any Registration Statement or the prospectus included
therein or for additional information;
(iii) of the issuance by the Commission of any stop order
suspending the effectiveness of any Registration Statement or the
initiation of any proceedings for that purpose;
(iv) of the receipt by Holdings of any notification with
respect to the suspension of the qualification of the Debentures,
the Exchange Debentures or the Private Exchange Debentures for sale
in any jurisdiction or the initiation or threatening of any
proceeding for such purpose; and
(v) of the happening of any event that requires the making of
any changes in any Registration Statement so that (A) the
Registration Statement and any amendment thereto does not, when it
becomes effective, contain an
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untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading or (B) any prospectus forming part of any
Registration Statement, and any supplement to such prospectus, does
not include an untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not
misleading.
(c) Holdings will use its reasonable best efforts to obtain the
withdrawal at the earliest possible time of any order suspending the
effectiveness of any Registration Statement.
(d) Holdings will furnish to each Holder of Transfer Restricted
Debentures included within the coverage of any Shelf Registration
Statement, without charge, at least one conformed copy of such Shelf
Registration Statement and any post-effective amendment thereto, including
financial statements and schedules and, if any such Holder so requests in
writing, all exhibits thereto (including those, if any, incorporated by
reference).
(e) Holdings will, during the Shelf Registration Period, promptly
deliver to each Holder of Transfer Restricted Debentures included within
the coverage of any Shelf Registration Statement, without charge, as many
copies of the prospectus (including each preliminary prospectus) included
in such Shelf Registration Statement and any amendment or supplement
thereto as such Holder may reasonably request; and Holdings consents to
the use of such prospectus or any amendment or supplement thereto by each
of the selling Holders of Transfer Restricted Debentures in connection
with the offer and sale of the Transfer Restricted Debentures covered by
such prospectus or any amendment or supplement thereto.
(f) Holdings will furnish to each Initial Purchaser and each
Exchanging Dealer, and to any other Holder who so requests, without
charge, at least one conformed copy of the Exchange Offer Registration
Statement and any post-effective amendment thereto, including financial
statements and schedules and, if any Initial Purchaser or Exchanging
Dealer or any such Holder so requests in writing, all exhibits thereto
(including those, if any, incorporated by reference).
(g) Holdings will, during the Exchange Offer Registration Period or
the Shelf Registration Period, as applicable, promptly deliver to each
Initial Purchaser, each Exchanging Dealer and such other persons that are
required to deliver a prospectus following the Registered Exchange Offer,
without charge, as many copies of the final prospectus included in the
Exchange Offer Registration Statement or the
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Shelf Registration Statement and any amendment or supplement thereto as
such Initial Purchaser, Exchanging Dealer or other persons may reasonably
request; and Holdings consents to the use of such prospectus or any
amendment or supplement thereto by any such Initial Purchaser, Exchanging
Dealer or other persons, as applicable, as aforesaid.
(h) Prior to the effective date of any Registration Statement,
Holdings will use its reasonable best efforts to register or qualify, or
cooperate with the Holders of Debentures, Exchange Debentures or Private
Exchange Debentures included therein and their respective counsel in
connection with the registration or qualification of, such Debentures,
Exchange Debentures or Private Exchange Debentures for offer and sale
under the Debentures or blue sky laws of such jurisdictions as any such
Holder reasonably requests in writing and do any and all other acts or
things necessary or advisable to enable the offer and sale in such
jurisdictions of the Debentures, Exchange Debentures or Private Exchange
Debentures covered by such Registration Statement; provided that Holdings
will not be required to qualify generally to do business in any
jurisdiction where they are not then so qualified or to take any action
which would subject them to general service of process or to taxation in
any such jurisdiction where they are not then so subject.
(i) Holdings will cooperate with the Holders of Debentures, Exchange
Debentures or Private Exchange Debentures to facilitate the timely
preparation and delivery of certificates representing Debentures, Exchange
Debentures or Private Exchange Debentures to be sold pursuant to any
Registration Statement free of any restrictive legends and in such
denominations and registered in such names as the Holders thereof may
request in writing prior to sales of Debentures, Exchange Debentures or
Private Exchange Debentures pursuant to such Registration Statement.
(j) If any event contemplated by Section 4(b)(ii) through (v) occurs
during the period for which Holdings is required to maintain an effective
Registration Statement, Holdings will promptly prepare and file with the
Commission a post-effective amendment to the Registration Statement or a
supplement to the related prospectus or file any other required document
so that, as thereafter delivered to purchasers of the Debentures, Exchange
Debentures or Private Exchange Debentures from a Holder, the prospectus
will not include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
(k) Not later than the effective date of the applicable Registration
Statement, Holdings will provide a CUSIP number for the Debentures, the
Exchange
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Debentures and the Private Exchange Debentures, as the case may be, and
provide the applicable trustee with printed certificates for the
Debentures, the Exchange Debentures or the Private Exchange Debentures, as
the case may be, in a form eligible for deposit with The Depository Trust
Company.
(l) Holdings will comply in all material respects with all
applicable rules and regulations of the Commission and Holdings will make
generally available to its security holders as soon as practicable after
the effective date of the applicable Registration Statement an earning
statement satisfying the provisions of Section 11(a) of the Securities
Act; provided that in no event shall such earning statement be delivered
later than 45 days after the end of a 12-month period (or 90 days, if such
period is a fiscal year) beginning with the first month of Holdings's
first fiscal quarter commencing after the effective date of the applicable
Registration Statement, which statement shall cover such 12-month period.
(m) Holdings will cause the Indenture or the Exchange Debentures
Indenture, as the case may be, to be qualified under the Trust Indenture
Act as required by applicable law in a timely manner.
(n) Holdings may require each Holder of Transfer Restricted
Debentures to be registered pursuant to any Shelf Registration Statement
to furnish to Holdings such information concerning the Holder and the
distribution of such Transfer Restricted Debentures as Holdings may from
time to time reasonably require for inclusion in such Shelf Registration
Statement, and Holdings may exclude from such registration the Transfer
Restricted Debentures of any Holder that fails to furnish such information
within a reasonable time after receiving such request.
(o) In the case of a Shelf Registration Statement, each Holder of
Transfer Restricted Debentures to be registered pursuant thereto agrees by
acquisition of such Transfer Restricted Debentures that, upon receipt of
any notice from Holdings pursuant to Section 4(b)(ii) through (v), such
Holder will discontinue disposition of such Transfer Restricted Debentures
until such Xxxxxx's receipt of copies of the supplemental or amended
prospectus or other document contemplated by Section 4(j) or until advised
in writing (the "Advice") by Holdings that the use of the applicable
prospectus may be resumed. If Holdings shall give any notice under Section
4(b)(ii) through (v) during the period that Holdings is required to
maintain an effective Registration Statement (the "Effectiveness Period"),
such Effectiveness Period shall be extended by the number of days during
such period from and including the date of the giving of such notice to
and including the date when each seller of Transfer Restricted Debentures
covered by such Registration Statement shall have received (x) the copies
of the supplemental or amended prospectus or other document con-
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templated by Section 4(j) (if an amended or supplemental prospectus or
other document is required) or (y) the Advice (if no amended or
supplemental prospectus or other document is required).
(p) In the case of a Shelf Registration Statement, Holdings shall
enter into such customary agreements (including, if requested, an
underwriting agreement in customary form) and take all such other action,
if any, as Holders of a majority in aggregate principal amount of the
Debentures, Exchange Debentures and Private Exchange Debentures being sold
or the managing underwriters (if any) shall reasonably request in order to
facilitate any disposition of Debentures, Exchange Debentures or Private
Exchange Debentures pursuant to such Shelf Registration Statement.
(q) In the case of a Shelf Registration Statement, Holdings shall
(i) make reasonably available for inspection by a representative of, and
Special Counsel (as defined below) acting for, Holders of a majority in
aggregate principal amount of the Debentures, Exchange Debentures and
Private Exchange Debentures being sold and any underwriter participating
in any disposition of Debentures, Exchange Debentures or Private Exchange
Debentures pursuant to such Shelf Registration Statement, all relevant
financial and other records, pertinent corporate documents and properties
of Holdings and the Designated Subsidiaries and (ii) use its reasonable
best efforts to have its officers, directors, employees, accountants and
counsel supply all relevant information reasonably requested by such
representative, Special Counsel or any such underwriter (an "Inspector")
in connection with such Shelf Registration Statement, in either case to
the extent reasonably requested by such representative, Special Counsel or
underwriter for the purpose of conducting customary due diligence with
respect to Holdings and the Designated Subsidiaries.
(r) In the case of a Shelf Registration Statement, Holdings shall,
if requested by Holders of a majority in aggregate principal amount of the
Debentures, Exchange Debentures and Private Exchange Debentures being
sold, their Special Counsel or the managing underwriters (if any) in
connection with such Shelf Registration Statement, use its reasonable best
efforts to cause (i) its counsel to deliver an opinion relating to the
Shelf Registration Statement and the Debentures, Exchange Debentures or
Private Exchange Debentures, as applicable, in customary form, (ii) its
officers to execute and deliver all customary documents and certificates
requested by Holders of a majority in aggregate principal amount of the
Debentures, Exchange Debentures and Private Exchange Debentures being
sold, their Special Counsel or the managing underwriters (if any) and
(iii) its independent public accountants to provide a comfort letter or
letters in customary form, subject to receipt of appropri-
-14-
ate documentation as contemplated, and only if permitted, by Statement of
Auditing Standards No. 72.
5. Registration Expenses. Holdings will bear all expenses incurred
in connection with the performance of its obligations under Sections 1, 2, 3 and
4 and Holdings will reimburse the Initial Purchasers and the Holders for the
reasonable fees and disbursements of one firm of attorneys (in addition to any
local counsel) chosen by the Holders of a majority in aggregate principal amount
of the Debentures, the Exchange Debentures and the Private Exchange Debentures
to be sold pursuant to each Registration Statement (the "Special Counsel")
acting for the Initial Purchasers or Holders in connection therewith.
6. Indemnification. (a) In the event of a Shelf Registration
Statement or in connection with any prospectus delivery pursuant to an Exchange
Offer Registration Statement by an Initial Purchaser or Exchanging Dealer, as
applicable, Holdings shall indemnify and hold harmless each Holder (including,
without limitation, any such Initial Purchaser or Exchanging Dealer), its
affiliates, their respective officers, directors, employees, representatives and
agents, and each person, if any, who controls such Holder within the meaning of
the Securities Act or the Exchange Act (collectively referred to for purposes of
this Section 6 and Section 7 as a Holder) from and against any loss, claim,
damage or liability, joint or several, or any action in respect thereof
(including, without limitation, any loss, claim, damage, liability or action
relating to purchases and sales of Debentures, Exchange Debentures or Private
Exchange Debentures), to which that Holder may become subject, whether commenced
or threatened, under the Securities Act, the Exchange Act, any other federal or
state statutory law or regulation, at common law or otherwise, insofar as such
loss, claim, damage, liability or action arises out of, or is based upon, (i)
any untrue statement or alleged untrue statement of a material fact contained in
any such Registration Statement or any prospectus forming part thereof or in any
amendment or supplement thereto or (ii) the omission or alleged omission to
state therein a material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading, and shall reimburse each Holder promptly
upon demand for any legal or other expenses reasonably incurred by that Holder
in connection with investigating or defending or preparing to defend against or
appearing as a third party witness in connection with any such loss, claim,
damage, liability or action as such expenses are incurred; provided, however,
that Holdings shall not be liable in any such case to the extent that any such
loss, claim, damage, liability or action arises out of, or is based upon, an
untrue statement or alleged untrue statement in or omission or alleged omission
from any of such documents in reliance upon and in conformity with any Holders'
Information; and provided, further, that with respect to any such untrue
statement in or omission from any related preliminary prospectus, the indemnity
agreement contained in this Section 6(a) shall not inure to the benefit of any
Holder from whom the person asserting
-15-
any such loss, claim, damage, liability or action received Debentures, Exchange
Debentures or Private Exchange Debentures to the extent that such loss, claim,
damage, liability or action of or with respect to such Holder results from the
fact that both (A) a copy of the final prospectus was not sent or given to such
person at or prior to the written confirmation of the sale of such Debentures,
Exchange Debentures or Private Exchange Debentures to such person and (B) the
untrue statement in or omission from the related preliminary prospectus was
corrected in the final prospectus unless, in either case, such failure to
deliver the final prospectus was a result of non-compliance by Holdings with
Section 4(d), 4(e), 4(f) or 4(g).
(b) In the event of a Shelf Registration Statement, each Holder
shall indemnify and hold harmless Holdings, its affiliates, its officers,
directors, employees, representatives and agents, and each person, if any, who
controls Holdings within the meaning of the Securities Act or the Exchange Act
(collectively referred to for purposes of this Section 6(b) and Section 7 as
"Holdings"), from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof, to which Holdings may become subject,
whether commenced or threatened, under the Securities Act, the Exchange Act, any
other federal or state statutory law or regulation, at common law or otherwise,
insofar as such loss, claim, damage, liability or action arises out of, or is
based upon, (i) any untrue statement or alleged untrue statement of a material
fact contained in any such Registration Statement or any prospectus forming part
thereof or in any amendment or supplement thereto or (ii) the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, but in each case only
to the extent that the untrue statement or alleged untrue statement or omission
or alleged omission was made in reliance upon and in conformity with any
Holders' Information furnished to Holdings by such Holder, and shall reimburse
Holdings for any legal or other expenses reasonably incurred by Holdings in
connection with investigating or defending or preparing to defend against or
appearing as a third party witness in connection with any such loss, claim,
damage, liability or action as such expenses are incurred; provided, however,
that no such Holder shall be liable for any indemnity claims hereunder in excess
of the amount of net proceeds received by such Holder from the sale of
Debentures, Exchange Debentures or Private Exchange Debentures pursuant to such
Shelf Registration Statement.
(c) Promptly after receipt by an indemnified party under this
Section 6 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party pursuant to Section 6(a) or 6(b), notify the indemnifying
party in writing of the claim or the commencement of that action; provided,
however, that the failure to notify the indemnifying party shall not relieve it
from any liability which it may have under this Section 6 or otherwise except to
the extent that it has been materially prejudiced by such failure. If any such
claim or action
-16-
shall be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 6 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than the reasonable costs of investigation; provided, however,
that an indemnified party shall have the right to employ its own counsel in any
such action, but the fees, expenses and other charges of such counsel for the
indemnified party will be at the expense of such indemnified party unless (1)
the employment of counsel by the indemnified party has been authorized in
writing by the indemnifying party, (2) the indemnified party has reasonably
concluded (based upon advice of counsel to the indemnified party) that there may
be legal defenses available to it or other indemnified parties that are
different from or in addition to those available to the indemnifying party, (3)
a conflict or potential conflict exists (based upon advice of counsel to the
indemnified party) between the indemnified party and the indemnifying party (in
which case the indemnifying party will not have the right to direct the defense
of such action on behalf of the indemnified party) or (4) the indemnifying party
has not in fact employed counsel reasonably satisfactory to the indemnified
party to assume the defense of such action within a reasonable time after
receiving notice of the commencement of the action, in each of which cases the
reasonable fees, disbursements and other charges of counsel will be at the
expense of the indemnifying party or parties. It is understood that the
indemnifying party or parties shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the reasonable fees,
disbursements and other charges of more than one separate firm of attorneys (in
addition to any local counsel) at any one time for all such indemnified party or
parties. Each indemnified party, as a condition of the indemnity agreements
contained in Sections 6(a) and 6(b), shall use all reasonable efforts to
cooperate with the indemnifying party in the defense of any such action or
claim. No indemnifying party shall be liable for any settlement of any such
action effected without its written consent (which consent shall not be
unreasonably withheld), but if settled with its written consent or if there be a
final judgment for the plaintiff in any such action, the indemnifying party
agrees to indemnify and hold harmless any indemnified party from and against any
loss or liability by reason of such settlement or judgment. No indemnifying
party shall, without the prior written consent of the indemnified party (which
consent shall not be unreasonably withheld), 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 on claims that are the subject matter
of
-17-
such proceeding and does not include a statement as to, or an admission of,
fault, culpability or failure to act, by or on behalf of any indemnified party.
7. Contribution. If the indemnification provided for in Section 6 is
unavailable or insufficient to hold harmless an indemnified party under Section
6(a) or 6(b), then each indemnifying party shall, in lieu of indemnifying such
indemnified party, contribute to the amount paid or payable by such indemnified
party as a result of such loss, claim, damage or liability, or action in respect
thereof, in such proportion as is appropriate to reflect the relative fault of
Holdings, on the one hand, and such Holder, on the other, with respect to the
statements or omissions that resulted in such loss, claim, damage or liability,
or action in respect thereof, as well as any other relevant equitable
considerations. The relative fault 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 Holdings
or information supplied by Holdings, on the one hand, or to any Holders'
Information supplied by such Holder, on the other, the intent of the parties and
their relative knowledge, access to information and opportunity to correct or
prevent such untrue statement or omission. The parties hereto agree that it
would not be just and equitable if contributions pursuant to this Section 7 were
to be determined by pro rata allocation or by any other method of allocation
that does not take into account the equitable considerations referred to herein.
The amount paid or payable by an indemnified party as a result of the loss,
claim, damage or liability, or action in respect thereof, referred to above in
this Section 7 shall be deemed to include, for purposes of this Section 7, any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending or preparing to defend any such
action or claim. Notwithstanding the provisions of this Section 7, an
indemnifying party that is a Holder of Debentures, Exchange Debentures or
Private Exchange Debentures shall not be required to contribute any amount in
excess of the amount by which the total price at which the Debentures, Exchange
Debentures or Private Exchange Debentures sold by such indemnifying party to any
purchaser exceeds the amount of any damages which such indemnifying party has
otherwise paid or become liable to pay by reason of any 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.
8. Rules 144 and 144A. Holdings shall use its reasonable best
efforts to file the reports required to be filed by it under the Securities Act
and the Exchange Act in a timely manner and, if at any time Holdings is not
required to file such reports, it will, upon the written request of any Holder
of Transfer Restricted Debentures, make publicly available other information so
long as necessary to permit sales of such Holder's Debentures pursuant to Rules
144 and 144A. Holdings covenants that it will take such further action as
-18-
any Holder of Transfer Restricted Debentures may reasonably request, all to the
extent required from time to time to enable such Holder to sell Transfer
Restricted Debentures without registration under the Securities Act within the
limitation of the exemptions provided by Rules 144 and 144A (including, without
limitation, the requirements of Rule 144A(d)(4)). Upon the written request of
any Holder of Transfer Restricted Debentures, Holdings shall deliver to such
Holder a written statement as to whether they have complied with such
requirements. Notwithstanding the foregoing, nothing in this Section 8 shall be
deemed to require Holdings to register any of its Debentures pursuant to the
Exchange Act.
9. Underwritten Registrations. If any of the Transfer Restricted
Debentures covered by any Shelf Registration Statement are to be sold in an
underwritten offering, the investment banker or investment bankers and manager
or managers that will administer the offering will be selected by the Holders of
a majority in aggregate principal amount of such Transfer Restricted Debentures
included in such offering, subject to the consent of Holdings (which shall not
be unreasonably withheld or delayed), and such Holders shall be responsible for
all underwriting commissions and discounts in connection therewith.
No person may participate in any underwritten registration hereunder
unless such person (i) agrees to sell such person's Transfer Restricted
Debentures on the basis reasonably provided in any underwriting arrangements
approved by the persons entitled hereunder to approve such arrangements and (ii)
completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents reasonably required under the terms
of such underwriting arrangements.
10. Miscellaneous. (a) Amendments and Waivers. The provisions of
this Agreement may not be amended, modified or supplemented, and waivers or
consents to departures from the provisions hereof may not be given, unless
Holdings has obtained the written consent of Holders of a majority in aggregate
principal amount of the Debentures, the Exchange Debentures and the Private
Exchange Debentures, taken as a single class. Notwithstanding the foregoing, a
waiver or consent to depart from the provisions hereof with respect to a matter
that relates exclusively to the rights of Holders whose Debentures, Exchange
Debentures or Private Exchange Debentures are being sold pursuant to a
Registration Statement and that does not directly or indirectly affect the
rights of other Holders may be given by Holders of a majority in aggregate
principal amount of the Debentures, the Exchange Debentures and the Private
Exchange Debentures being sold by such Holders pursuant to such Registration
Statement.
(b) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail,
telecopier or air courier guaranteeing next-day delivery:
-19-
(1) if to a Holder, at the most current address given by such
Holder to Holdings in accordance with the provisions of this Section
10(b), which address initially is, with respect to each Holder, the
address of such Holder maintained by the Registrar under the
Indenture, with a copy in like manner to DLJ Investment Partners,
Inc.;
(2) if to the Initial Purchasers, initially at the address set
forth in the Purchase Agreement; and
(3) if to Holdings, initially at the address of Holdings set
forth in the Purchase Agreement.
All such notices and communications shall be deemed to have been
duly given: when delivered by hand, if personally delivered; one business day
after being delivered to a next-day air courier; five business days after being
deposited in the mail; and when receipt is acknowledged by the recipient's
telecopier machine, if sent by telecopier.
(b) Successors And Assigns. This Agreement shall be binding upon
Holdings and its respective successors and assigns.
(c) Counterparts. This Agreement may be executed in any number of
counterparts (which may be delivered in original form or by telecopier) and by
the parties hereto in separate counterparts, each of which when so executed
shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
(d) Definition of Terms. For purposes of this Agreement, (a) the
term "business day" means any day on which the New York Stock Exchange, Inc. is
open for trading, (b) the term "subsidiary" has the meaning set forth in Rule
405 under the Securities Act and (c) except where otherwise expressly provided,
the term "affiliate" has the meaning set forth in Rule 405 under the Securities
Act.
(e) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(f) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
(g) Remedies. In the event of a breach by Holdings by any Holder of
any of their obligations under this Agreement, each Holder or Holdings, as the
case may be, in addition to being entitled to exercise all rights granted by
law, including recovery of damages (other than the recovery of damages for a
breach by Holdings of its obligations under
-20-
Sections 1 or 2 hereof for which Additional Amounts have been paid pursuant to
Section 3 hereof), will be entitled to specific performance of its rights under
this Agreement. Holdings and each Holder agree that monetary damages would not
be adequate compensation for any loss incurred by reason of a breach by each
such person of any of the provisions of this Agreement and hereby further agree
that, in the event of any action for specific performance in respect of such
breach, each such person shall waive the defense that a remedy at law would be
adequate.
(h) No Inconsistent Agreements. Holdings represents, warrants and
agrees that (i) it has not entered into, and shall not on or after the date of
this Agreement, enter into any agreement that is inconsistent with the rights
granted to the Holders in this Agreement or otherwise conflicts with the
provisions hereof, (ii) it has not previously entered into any agreement which
remains in effect granting any registration rights with respect to any of its
debt securities to any person and (iii) (with respect to Holdings) without
limiting the generality of the foregoing, without the written consent of the
Holders of a majority in aggregate principal amount of the then outstanding
Transfer Restricted Debentures, it shall not grant to any person the right to
request Holdings to register any debt securities of Holdings under the
Securities Act unless the rights so granted are not in conflict or inconsistent
with the provisions of this Agreement.
(i) No Piggyback on Registrations. Neither Holdings nor any of its
security holders (other than the Holders of Transfer Restricted Debentures in
such capacity) shall have the right to include any securities of Holdings in any
Shelf Registration or Registered Exchange Offer other than Transfer Restricted
Debentures.
(j) Severability. The remedies provided herein are cumulative and
not exclusive of any remedies provided by law. If any term, provision, covenant
or restriction of this Agreement is held by a court of competent jurisdiction to
be invalid, illegal, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions set forth herein shall remain in full
force and effect and shall in no way be affected, impaired or invalidated, and
the parties hereto shall use their reasonable best efforts to find and employ an
alternative means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction. It is hereby
stipulated and declared to be the intention of the parties that they would have
executed the remaining terms, provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid, illegal, void or
unenforceable.
-21-
Please confirm that the foregoing correctly sets forth the agreement
between Holdings and the Initial Purchasers.
Very truly yours,
ALEC HOLDINGS, INC.,
By: /s/ Xxxxxxx X. Xxxxxxxxx
-----------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Senior Vice President and
Chief Financial Officer
Accepted:
DLJ INVESTMENT PARTNERS, L.P.,
By: DLJ INVESTMENT PARTNERS, INC.
General Partner
BY: /s/ Xxx Xxxxx
---------------------------------
Name: Xxx Xxxxx
Title: Vice President
Accepted:
DLJ INVESTMENT FUNDING, INC.
BY: /s/ Xxx Xxxxx
---------------------------------
Name: Xxx Xxxxx
Title: Vice President
Accepted:
DLJ ESC, L.P.,
By: DLJ LBO PLANS MANAGEMENT CORPORATION,
its General Partner
BY: /s/ Xxx Xxxxx
---------------------------------
Name: Xxx Xxxxx
Title: Vice President
ANNEX A
Each broker-dealer that receives Exchange Debentures for its own
account pursuant to the Registered Exchange Offer must acknowledge that it will
deliver a prospectus in connection with any resale of such Exchange Debentures.
The Letter of Transmittal states that by so acknowledging and by delivering a
prospectus, a broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act. This Prospectus, as it
may be amended or supplemented from time to time, may be used by a broker-dealer
in connection with resales of Exchange Debentures received in exchange for
Debentures where such Debentures were acquired by such broker-dealer as a result
of market-making activities or other trading activities. Holdings has agreed
that, for a period of 180 days after the consummation of the Registered Exchange
Offer, it will make this Prospectus available to any broker-dealer for use in
connection with any such resale. See "Plan of Distribution".
ANNEX B
Each broker-dealer that receives Exchange Debentures for its own
account in exchange for Debentures, where such Debentures were acquired by such
broker-dealer as a result of market-making activities or other trading
activities, must acknowledge that it will deliver a prospectus in connection
with any resale of such Exchange Debentures. See "Plan of Distribution".
ANNEX C
PLAN OF DISTRIBUTION
Each broker-dealer that receives Exchange Debentures for its own
account pursuant to the Registered Exchange Offer must acknowledge that it will
deliver a prospectus in connection with any resale of such Exchange Debentures.
This Prospectus, as it may be amended or supplemented from time to time, may be
used by a broker-dealer in connection with resales of Exchange Debentures
received in exchange for Debentures where such Debentures were acquired as a
result of market-making activities or other trading activities. Holdings has
agreed that, for a period of 180 days after the consummation of the Registered
Exchange Offer, it will make this prospectus, as amended or supplemented,
available to any broker-dealer for use in connection with any such resale. In
addition, until August 13, 1999, all dealers effecting transactions in the
Exchange Debentures may be required to deliver a prospectus.
Holdings will not receive any proceeds from any sale of Exchange
Debentures by broker-dealers. Exchange Debentures received by broker-dealers for
their own account pursuant to the Registered Exchange Offer may be sold from
time to time in one or more transactions in the over-the-counter market, in
negotiated transactions, through the writing of options on the Exchange
Debentures or a combination of such methods of resale, at market prices
prevailing at the time of resale, at prices related to such prevailing market
prices or at negotiated prices. Any such resale may be made directly to
purchasers or to or through brokers or dealers who may receive compensation in
the form of commissions or concessions from any such broker-dealer or the
purchasers of any such Exchange Debentures. Any broker-dealer that resells
Exchange Debentures that were received by it for its own account pursuant to the
Registered Exchange Offer and any broker or dealer that participates in a
distribution of such Exchange Debentures may be deemed to be an "underwriter"
within the meaning of the Securities Act and any profit on any such resale of
Exchange Debentures and any commission or concessions received by any such
persons may be deemed to be underwriting compensation under the Securities Act.
The Letter of Transmittal states that, by acknowledging that it will deliver and
by delivering a prospectus, a broker-dealer will not be deemed to admit that it
is an "underwriter" within the meaning of the Securities Act.
For a period of 180 days after the consummation of the Registered
Exchange Offer, Holdings will promptly send additional copies of this Prospectus
and any amendment or supplement to this Prospectus to any broker-dealer that
requests such documents in the Letter of Transmittal. Holdings has agreed to pay
all expenses incident to the Registered
-2-
Exchange Offer (including the expenses of one counsel for the Holders of the
Debentures) other than commissions or concessions of any broker-dealers and will
indemnify the Holders of the Debentures (including any broker-dealers) against
certain liabilities, including liabilities under the Securities Act.
ANNEX D
|_| CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10
ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS
OR SUPPLEMENTS THERETO.
Name:
Address:
If the undersigned is not a broker-dealer, the undersigned
represents that it is not engaged in, and does not intend to engage in, a
distribution of Exchange Debentures. If the undersigned is a broker-dealer that
will receive Exchange Debentures for its own account in exchange for Debentures
that were acquired as a result of market-making activities or other trading
activities, it acknowledges that it will deliver a prospectus in connection with
any resale of such Exchange Debentures; however, by so acknowledging and by
delivering a prospectus, the undersigned will not be deemed to admit that it is
an "underwriter" within the meaning of the Securities Act.
