ASSIGNMENT AGREEMENT
November 6, 1998
CHASE SECURITIES INC.
XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION
BANKBOSTON XXXXXXXXX XXXXXXXX INC.
c/o Chase Securities Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Gentlemen:
This will confirm the understanding and agreement among Chase
Securities Inc. ("CSI"), Xxxxxxxxx, Xxxxxx & Xxxxxxxx Securities Corporation
("DLJ") and BankBoston Xxxxxxxxx Xxxxxxxx Inc. ("BankBoston") (collectively, the
"Purchasers") and Republic Engineered Steels, Inc., a Delaware corporation (the
"Company"), with respect to the agreement by the Purchasers to purchase, in
certain circumstances, such principal amount of 9 7/8% First Mortgage Notes Due
2001 (the "Mortgage Notes") of the Company as the Lenders may elect (an
"Election") under the terms of the Credit Agreement referred to below pursuant
to an assignment by the Company of its right to purchase Mortgage Notes in
connection with the Company's tender offer to purchase any and all of the
$200,000,000 principal amount of Mortgage Notes for cash at a price of 101% of
the principal amount thereof, together with accrued and unpaid interest thereon,
upon the terms and subject to the conditions set forth in the Notice of Change
of Control and Offer to Purchase dated October 6, 1998 (the "Offer to
Purchase"), as the same was amended and supplemented on October 29, 1998 and the
same may be hereafter amended, supplemented or modified from time to time in
accordance with the terms hereof (the "Tender Offer"). Capitalized terms used
herein but not defined herein shall have the meanings ascribed to such terms in
the Credit Agreement dated as of November 6, 1998 among the Company, the
Guarantors named therein, the Lenders named therein, The Chase Manhattan Bank,
DLJ Bridge Finance, Inc. and BankBoston, N.A., as Agents (the "Credit
Agreement").
The Company and the Purchasers each hereby agrees as follows:
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1. Purchase Under Assignment.
(a) Upon the basis of the representations, warranties and agreements of
the Company contained herein and in the Credit Agreement subject to all of the
terms and conditions of this Agreement and the Credit Agreement, each of the
Purchasers agrees, severally and not jointly, that, following the Election, it
shall purchase, and the Company shall assign to the Purchasers on such basis, up
to each Purchaser's Proportionate Share (as defined below) of such aggregate
principal amount of Mortgage Notes as may be purchased, in light of the
Election, at a purchase price of $1,010 per $1,000 principal amount of Mortgage
Notes, plus all accrued interest on the Mortgage Notes since June 15, 1998 to
the payment date under the Tender Offer (the "Purchase Price") pursuant to the
Tender Offer; provided that the aggregate Purchase Price paid by a Purchaser
shall not exceed its Proportionate Share of the sum of (x) $202,000,000 and (y)
accrued and unpaid interest on the Mortgage Notes since June 15, 1998 to the
payment date under the Tender Offer. To the extent the Lenders make such
Election, the Company shall, prior to the acceptance for payment Mortgage Notes
validly tendered and not properly withdrawn pursuant to the Tender Offer, hereby
assign (the "Assignment") all or a portion (as specified by the Election) of its
right to purchase Mortgage Notes validly tendered and not properly withdrawn
pursuant to the Tender Offer on the Expiration Date to the Purchasers, and the
Purchasers shall make the required payment of the Purchase Price to the Paying
Agent (as defined in the Offer to Purchase), in accordance with the terms of
this Agreement and the Indenture. Mortgage Notes purchased hereunder by the
Purchasers are referred to herein as the "Purchased Notes." "Proportionate
Share" means, with respect to CSI, 60%; with respect to DLJ, 32%; and with
respect to BankBoston, 8%.
(b) Delivery of and payment for the Mortgage Notes to be purchased by a
Purchaser under Section 1(a) shall be made on the initial Borrowing Date (as
specified in the Credit Agreement) (the "Closing Date"). Delivery of such
Mortgage Notes shall be made to a Purchaser against payment by such Purchaser of
the purchase price therefor by wire transfer in immediately available funds
wired to the Paying Agent in accordance with the written instructions of the
Company delivered as soon as practicable prior to the Closing Date, which
written instructions shall specify the aggregate Purchase Price. Delivery of
such Mortgage Notes in definitive form shall be made at such location in New
York, New York as each Purchaser shall reasonably designate on the Closing Date
and shall be registered in such names and in such denominations as such
Purchaser
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may request on or in advance of the Closing Date subject to the terms of the
Existing Notes Indenture governing such Mortgage Notes (referred to herein as
the "Indenture"). The Company agrees to use its reasonable best efforts to have
such Mortgage Notes available for inspection and checking by each Purchaser in
New York, New York, not later than 1:00 P.M. on the Business Day prior to the
Closing Date. The Mortgage Notes shall have attached thereto the restrictive
legend required under the terms of the Indenture.
(c) The obligations of each Purchaser under this Agreement shall be
subject to the accuracy of the representations and warranties of the Company
contained herein as of the date hereof and as of the Closing Date as if made on
and as of such date, to the accuracy of the statements of the Company's officers
made pursuant to the provisions hereof, to the performance by the Company of its
covenants and agreements hereunder and to the conditions set forth in Section
3.1A of the Credit Agreement applicable to the Initial Loans to be made on the
Closing Date.
(d) Each Purchaser represents and warrants that this Agreement has been
duly authorized, executed and delivered by such Purchaser and is enforceable
against such Purchaser in accordance with its terms, except as enforceability
hereof may be limited by bankruptcy, insolvency or similar laws affecting the
enforcement of creditors' rights generally and by general equitable principles,
regardless of whether such enforceability is considered in a proceeding in
equity or at law.
2. Fees. [INTENTIONALLY OMITTED]
3. Certain Payments.
(a) By the Purchasers. [INTENTIONALLY OMITTED]
(b) By the Company. (i) [INTENTIONALLY OMITTED]
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(ii) In the event that the Purchased Notes are redeemed, defeased,
purchased, accelerated or otherwise retired (in any such case, "Retired") by the
Company in a manner such that the gross proceeds per $1,000 principal amount of
Purchased Notes (exclusive of accrued interest on such Purchased Notes) (the
"Per Note Proceeds") is less than the Purchase Price (exclusive of the amount of
accrued interest included therein), the Company agrees to promptly pay to each
Purchaser in cash at such time, by wire transfer of immediately available funds,
an amount (the "Premium Make-Whole Payment") equal to the product of (A) the
aggregate principal amount of Purchased Notes acquired by such Purchaser on the
Closing Date and so Retired, whether or not then owned by such Purchaser,
divided by $1,000 and (B) (1) if the Per Note Proceeds are greater than $1,000,
the difference between the Purchase Price (exclusive of the amount of accrued
interest included therein) and the Per Note Proceeds or (2) if the Per Note
Proceeds are $1,000 or less, $10.00.
4. Nature of Obligations. All amounts owing by the Company under
Section 3(b) and under the Purchased Notes and the Indenture are cumulative. The
Company's obligations hereunder are intended to be the "Obligations" referred to
in the Credit Agreement and, as such, shall be secured by the Collateral and
guaranteed by the Guarantors. In the event of an acceleration of the Mortgage
Notes, all amounts owing under Section 3(b)(i) shall continue to accrue and be
payable and shall be of the character of interest and any amounts owing under
Section 3(b)(ii) shall be deemed to be ipso facto due and payable, without the
necessity of acceleration, demand or presentment.
5. Put Right.
(a) Subject to all of the terms and conditions of this Section 5, the
Company hereby grants to the Purchasers the right and option (but not the
obligation) (the "Put Right"), at any time following an Event of Default and
(only to the extent there are any Loans outstanding) an acceleration of the
Loans, to cause the Company to purchase all or a portion of the Purchased Notes
held by the Purchasers at a purchase price per $1,000 principal amount of
Purchased Notes equal to the sum of (x) $1,010 and (y) the amount of all accrued
and unpaid interest on the Purchased Notes; provided that if the Company does
not pay the purchase price for the Purchased Notes subject to such Put Notice
by the fifth business day following
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delivery of such Put Notice, then the Purchaser will be free to sell such
Purchased Notes. The Put Right may be exercised only by delivery of a written
notice to the Company (a "Put Notice") upon any acceleration under the Credit
Agreement or, if no Loans are outstanding under the Credit Agreement, upon the
demand of Purchasers holding Purchased Notes representing 25% of the aggregate
principal amount of Purchased Notes.
(b) Immediately upon any exercise of the Put Right, (i) the Put Price
shall be immediately due and payable and the Company shall be required to
deliver payment to the Purchasers of the purchase price for the Purchased Notes
in immediately available funds, by wire transfer to an account designated in
writing by the Purchasers and (ii) the Purchasers shall sell, transfer, and
assign the Purchased Notes being purchased by the Company free and clear of any
adverse claims or encumbrances arising through it, duly endorsed or together
with a standard bond power duly endorsed in blank (or otherwise through the
facilities of a Book-Entry Transfer Facility).
6. Exchange Right. [INTENTIONALLY OMITTED]
7. Legended Securities; Rule 144 and Rule 144A. The Purchased Notes
shall bear the legend relating to restrictions under the Securities Act of 1933
(the "Securities Act") required by the supplemental indenture dated November 4,
1998 to the Indenture. The Company shall use its reasonable best efforts to file
the reports required to be filed by it under the Indenture under the Securities
Exchange Act of 1934 (the "Exchange Act") in a timely manner and, if at any time
the Company is not required to file such reports, it will, upon the written
request of any holder of Purchased Notes, make publicly
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available other information so long as necessary to permit sales of such
holder's securities pursuant to Rules 144 and 144A. The Company covenants that
it will take such further action as any holder of Purchased Notes may reasonably
request, all to the extent required from time to time to enable such holder to
sell Purchased Notes 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 Purchased Notes, the Company shall deliver to such holder a
written statement as to whether it has complied with such requirements.
Notwithstanding the foregoing, nothing in this Section 7 shall be deemed to
require the Company to register any of its securities pursuant to the Securities
Act or the Exchange Act.
8. Representations and Warranties of the Company. All of the
representations and warranties set forth in the Credit Agreement as of the
Closing Date are incorporated herein by reference for the benefit of the
Purchasers. The Company further represents and warrants to each of the
Purchasers that as of the date hereof and at the Closing Date:
(a) The Company has the corporate power and authority to take, and has
taken, all necessary corporate action to authorize (i) the Tender Offer
(including the financing therefor described in the Offering Materials (as
defined below)), (ii) the purchase by the Company of Mortgage Notes
pursuant to the Tender Offer and (iii) the execution, delivery and
performance of this Agreement, and this Agreement has been duly executed
and delivered on behalf of the Company and is a legal, valid and binding
obligation of the Company, enforceable against it in accordance with its
terms, except to the extent that such enforceability may be affected by
applicable bankruptcy, insolvency, fraudulent conveyance, reorganization,
moratorium and other similar laws relating to or affecting creditors'
rights generally and by general equitable principles (whether considered
in a proceeding in equity or at law) and an implied covenant of good
faith and fair dealing and except as the enforceability of indemnification
and contribution provisions may be limited by public policy considerations.
(b) In connection with the Tender Offer and the Alternate Tender Offer,
the Company has complied, and will continue to comply, in all material
respects with the applicable sections of the Exchange Act. The Offering
Materials do not contain and will not contain any untrue in-
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formation or untrue statement of a material fact, and do not omit and will
not omit to state any information or a material fact required to be stated
therein or necessary to make the statements made therein, in light of the
circumstances under which they are made, not misleading.
(c) The Tender Offer (including any financing therefor as described in
the Offering Materials), the purchase by the Company of Notes pursuant to
the Tender Offer, and the execution, delivery and performance of this
Agreement by the Company comply and will continue to comply in all material
respects with all applicable requirements of Federal, state and local law,
including, without limitation, any applicable regulations of the Commission
and Other Agencies, and all applicable judgments, orders or decrees; and no
consent, authorization, approval, order, exemption, registration,
qualification or other action of, or filing with or notice to ("Consents"),
the Commission or any Other Agency is required in connection with the
execution, delivery and performance of this Agreement by the Company, the
making or consummation by the Company of the Tender Offer or the
consummation of the other transactions contemplated by this Agreement
assuming compliance by the Purchasers with the terms thereof and except for
such Consents as may be required under state securities or "blue sky" laws
and except for such Consents as may be required to perform any registration
requirements under the Securities Act.
(d) The Tender Offer (including any financing therefor as described in
the Offering Materials), the purchase of Mortgage Notes by the Company
pursuant to the Tender Offer, and the execution, delivery and performance
of this Agreement by the Company do not and will not conflict with or
result in a breach of any of the terms or provisions of or constitute a
default (with or without due notice and or lapse of time) under, (i) the
certificate of incorporation or by-laws (or similar organizational
documents) of the Company or any of its subsidiaries, (ii) any loan or
credit agreement, indenture, mortgage, note or other loan or credit
agreement, indenture, mortgage, note or other agreement or instrument to
which the Company or any of its subsidiaries is a party or by which any of
them or any of their respective properties or assets is or may be bound
except, in each case, for such conflicts, breaches and defaults as would
not have a material adverse effect on the Company and its subsidiaries,
taken as a whole.
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(e) The Company will make, as required by applicable law or regulation,
any and all necessary amendments or supplements to the Offering Materials,
and the Company will file, as required by applicable law or regulation,
any and all necessary amendments or supplements to any documents filed
with the Commission or other Tribunals relating to the Tender Offer, and
will promptly furnish to each of you as many true and complete copies as
each of you may request of each such amendment and supplement upon the
filing thereof.
(f) No stop order, restraining order or denial of an application for
approval has been issued and no proceedings, litigation or investigation
have been initiated or, to the Company's knowledge, threatened before the
Commission or any other Tribunals with respect to the making or
consummation of the Tender Offer (including the obtaining or use of funds
to purchase Mortgage Notes) or the execution, delivery and performance of
this Agreement or the consummation of the other transactions contemplated
by this Agreement or with respect to the ownership of Notes by the Company
or any of its subsidiaries or affiliates.
(g) No form of general solicitation or general advertising (as those
terms are used in Regulation D under the Securities Act) was used by the
Company, or any of its representatives in connection with the assignment of
Mortgage Notes pursuant to this Agreement, including, but not limited to,
articles, notices or other communication published in any newspaper,
magazine or similar medium or broadcast over television or radio, or any
seminar or meeting whose attendees have been invited by any general
solicitation or general advertising.
(h) The Offering Memorandum, as supplemented or amended at any time (as
defined in Section 9(e)), as of its date, will not contain any untrue
statement of a material fact or omit to state 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.
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9. Certain Covenants of the Company. The Company covenants with each of
the Purchasers to comply with all covenants contained in the Indenture and the
Credit Agreement and, in addition, as follows:
(a) If, during the Tender Offer and for such period of time thereafter
as Offering Materials are either (i) being used or (ii) required by law to
be delivered in connection therewith, any event occurs as a result of which
it shall be necessary to amend or supplement any Offering Materials in
order to make the statements therein, in light of the circumstances under
which they were made, not misleading in any material respect, the Company
shall, promptly upon becoming aware of any such event, advise each
Purchaser of such event and, as promptly as practicable under the
circumstances, prepare and furnish copies to each Purchaser of such
amendments or supplements to any such Offering Materials, so that the
statements in such Offering Materials, as so amended or supplemented, will
not, in light of the circumstances under which they were made, be
misleading in any material respect. As used herein, "Offering Materials"
shall mean the Offer to Purchase, together with all attachments thereto,
and all such other related offering materials, as such materials may be
amended, modified or supplemented from time to time.
(b) The Company shall comply in all material respects with the
applicable provisions of the Securities Act and the rules and regulations
of the Commission promulgated thereunder, the Exchange Act and the rules
and regulations of the Commission promulgated thereunder, and the TIA, in
connection with the Offering Materials, the Tender Offer and the
transactions contemplated thereby, provided that this covenant shall not
obligate the Company to register any securities other than as contemplated
by Section 10 hereof.
(c) All Purchased Notes acquired by the Company after the Closing Date
(excluding any Mortgage Notes acquired by the Company pursuant to the
Tender Offer) shall be retired and shall not be available for reissuance or
resale, notwithstanding any provision in the Indenture to the contrary.
(d) The Company agrees not to amend or modify the terms of the Tender
Offer (including, without limitation, the tender offer consideration) in
any material respect
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without the consent of each Purchaser which consent will not be
unreasonably withheld or delayed.
(e) The Company agrees, at its sole expense, to use its reasonable best
efforts to prepare by November 15, 1998 an offering memorandum containing
such disclosure as may be required by the Securities Act and other
applicable laws and such other disclosure and is appropriate for such a
document, under the circumstances, to allow the Purchasers to sell the
Purchased Notes pursuant to Rule 144A of, or any other available exemption
under, the Securities Act relating to the Purchased Notes (the "Offering
Memorandum"). The Company agrees to update the Offering Memorandum as
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and to advise the
Purchasers promptly of the happening of any event which makes any statement
of a material fact made in the Offering Memorandum untrue or which requires
the making of any additions to or changes in the Offering Memorandum (as
amended or supplemented from time to time) in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading. In the event an Offering Memorandum is not available on or
after November 30, 1998, the Company shall be liable to the Purchasers for
Liquidated damages at a rate of $.20 per full or partial week per $1,000
principal amount of Purchased Notes held by the Purchasers up to a maximum
of $.20 per week or partial week per $1,000 principal amount due to the
harm suffered by the Purchasers, which cannot be ascertained with
precision. Such damages shall cease to accrue at such time as the Company
makes available an Offering Memorandum for use by the Purchasers. All of
the procedures set forth in subparagraphs (a), (c), (g), (h), (j), (m), (p)
and (q) of Section 11 hereof (other than to the extent applicable strictly
to a public offering) shall apply to this subparagraph (e) with only the
Purchasers being considered to be Holders for this purpose.
10. Demand Registration. (a) At any time after the date hereof, the
Administrative Agent, on behalf of the Purchasers originally party hereto, may
make a written request to the Company for a shelf registration under the
Securities Act with respect to all of the Purchased Notes held by such Purchaser
or any other Person. The Company agrees to file with the Commission no later
than the latest of (x) the Securities Demand Date or (y) 60 days after such
request (the "Shelf Filing Date"), a Registration Statement for an offering to
be made
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on a continuous basis pursuant to Rule 415 covering all of the Purchased
Notes (the "Shelf Registration"). The Shelf Registration shall be on Form S-1 or
another appropriate form permitting registration of such Purchased Notes for
resale by holders of Purchased Notes ("Holders") in the manner or manners
designated by them (including, without limitation, one or more underwritten
offerings). The Company shall not permit any securities other than the Purchased
Notes to be included in the Shelf Registration. The Company shall use its
reasonable best efforts to cause the Shelf Registration to be declared effective
under the Securities Act on or prior to the 150th day after such request (the
"Shelf Effectiveness Date") and to keep such Shelf Registration continuously
effective under the Securities Act until the date which is two years from the
Closing Date (the "Shelf Termination Date"), or such shorter period ending when
all Purchased Notes covered by such Shelf Registration have been sold in the
manner set forth and as contemplated in such Shelf Registration. If a Shelf
Registration or any Subsequent Shelf Registration ceases to be effective for any
reason at any time prior to the Shelf Termination Date (other than because of
the sale of all Purchased Notes covered by such Shelf Registration in the manner
set forth and as contemplated in such Shelf Registration) the Company shall use
its reasonable best efforts to obtain the prompt withdrawal of any order
suspending the effectiveness thereof, and in any event shall within 45 days of
such cessation of effectiveness amend such Shelf Registration in a manner
reasonably expected to obtain the withdrawal of the order suspending the
effectiveness thereof. The Company shall promptly supplement and amend a Shelf
Registration if required by the rules, regulations or instructions applicable to
the registration form used for such Shelf Registration, if required by the
Securities Act, or if reasonably requested by the Holders of a majority in
aggregate principal amount of the Purchased Notes covered by such Registration
Statement or by any underwriter of such Purchased Notes.
(b) The Company agrees not to effect any sale or distribution of any
debt securities in customary high yield or mezzanine public or private markets
prior to the Conversion Date (except for the purpose of funding a Redemption and
refinancing the Loans), for so long as any Purchased Notes are outstanding,
without the consent of the Required Lenders.
(c) The Company agrees that the Holders will suffer damages if the
Company fail to fulfill their obligations to holders of Purchased Notes under
this Section 10 hereof and that it would not be feasible to ascertain the extent
of such
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damages with precision. Accordingly, the Company agrees to pay liquidated
damages to the Holders ("Liquidated Damages") under the circumstances and to the
extent set forth below:
(i) if the Shelf Registration has not been filed on or prior to the
Shelf Filing Date, then commencing on the day after such Shelf Filing Date,
Liquidated Damages shall be accrued on the Purchased Notes over and above the
accrued interest at a rate of $.20 per full or partial week per $1,000 principal
amount of Purchased Notes;
(ii) if such Shelf Registration has been filed but has not been
declared effective on or prior to such Shelf Effectiveness Date, then commencing
on the day after such Shelf Effectiveness Date Liquidated Damages shall be
accrued on the Purchased Notes over and above the accrued interest at a rate of
$.20 per full or partial week per $1,000 principal amount of Purchased Notes;
and
(iii) if a Shelf Registration has been declared effective and such
Shelf Registration ceases to be effective at any time prior to the Shelf
Termination Date, then Liquidated Damages shall be accrued on the Purchased
Notes affected thereby over and above the accrued interest at a rate of $.20 per
full or partial week per $1,000 principal amount of Purchased Notes;
provided, however, that in no event shall the amount of Liquidated Damages
exceed $.20 per full or partial week per $1,000 principal amount of Purchased
Notes; and provided, further, however, that (1) upon the filing of a Shelf
Registration (in the case of (i) above) or (2) upon the effectiveness of a Shelf
Registration (in the case of (ii) above), Liquidated Damages on the Purchased
Notes as a result of such clause, as the case may be, shall cease to accrue.
Notwithstanding the foregoing provisions of Section 10(c), the Company
may issue a notice that the Shelf Registration Statement is unusable pending the
announcement of a material corporate transaction or development and may issue
any notice suspending use of the Shelf Registration Statement required under
applicable securities laws to be issued and, in the event that the aggregate
number of days in any consecutive
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twelve-month period for which all such notices are issued and effective does not
exceed 30 days in the aggregate, then Liquidated Damages shall cease to accrue
during such period in which such notices are issued and effective.
11. Registration Procedures. In connection with the filing of any
registration statement for a Shelf Registration (a "Registration Statement"),
the Company shall as expeditiously as possible:
(a) Prepare and file with the Commission prior to the Shelf Filing
Date, a Registration Statement, and use every reasonable effort to cause
each such Registration Statement to become effective and remain effective
as provided herein; provided, however, before filing any Registration
Statement or Prospectus or any amendments or supplements thereto (not
including documents that would be incorporated or deemed to be incorporated
therein by reference), the Company shall afford the Inspectors (as
defined), if any, an opportunity to review, promptly, copies of all such
documents proposed to be filed; provided, however, that the Company shall
not be required to afford such persons an opportunity to review a copy of
(i) any such document that has not been materially changed from a copy of
such document that such person was previously afforded an opportunity to
review and (ii) any amendments or supplements to a Registration Statement
or Prospectus which are made solely as a result of any filing by the
Company of reports required to be filed pursuant to the Exchange Act.
(b) 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 continuously effective for
the time periods prescribed hereby; cause the related Prospectus to be
supplemented by any required Prospectus supplement, and as so supplemented
to be filed pursuant to Rule 424 (or any similar provisions then in force)
under the Securities Act; and comply with the provisions of the Securities
Act, the Exchange Act and the rules and regulations of the Commission
promulgated thereunder applicable to it with respect to the disposition of
all securities covered by such Registration Statement as so amended or in
such Prospectus as so supplemented.
(c) Notify the selling Holders, their counsel and the managing
underwriters, if any, promptly (but in any
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event within two business days after becoming aware thereof), and confirm
such notice in writing, (i) when a Prospectus or any Prospectus supplement
or post-effective amendment has been filed, and, with respect to a
Registration Statement or any post-effective amendment, when the same has
become effective (including in such notice a written statement that any
holder may, upon request, obtain, without charge, one conformed copy of
such Registration Statement or post-effective amendment including financial
statements and schedules but excluding documents incorporated or deemed to
be incorporated by reference and exhibits), (ii) of the issuance by the
Commission of any stop order suspending the effectiveness of such
Registration Statement or of any order preventing or suspending the use of
any preliminary prospectus or the initiation of any proceedings for that
purpose, (iii) if at any time when a prospectus is required by the
Securities Act to be delivered in connection with sales of the Purchased
Notes covered by such Registration Statement the representations and
warranties of the Company contained in any agreement (including any
underwriting agreement) contemplated by subparagraph (o) below cease to be
true and correct, (iv) of the receipt by the Company of any notification
with respect to the suspension of the qualification or exemption from
qualification of such Registration Statement or any of the Purchased Notes
for offer or sale in any jurisdiction, or the initiation or threatening of
any proceeding for such purpose, (v) of the happening of any event, the
existence of any condition or any information becoming known that makes any
statement made in such Registration Statement or related Prospectus or any
document incorporated or deemed to be incorporated therein by reference
untrue in any material respect or that requires the making of any changes
in such Registration Statement, Prospectus or documents so that, in the
case of such Registration Statement, it will not contain any untrue
statement of a material fact or omit to state any material fact required to
be stated therein or necessary to make the statements therein, not
misleading, and that in the case of the Prospectus, it will not contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not
misleading, and (vi) of the Company's reasonable determination that a
post-effective amendment to such Registration Statement would be
appropriate.
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(d) Use its best efforts to prevent the issuance of any order
suspending the effectiveness of a Registration Statement or of any order
preventing or suspending the use of a Prospectus or suspending the
qualification (or exemption from qualification) of any of the Purchased
Notes for sale in any jurisdiction, and, if any such order is issued, to
obtain the withdrawal of any such order at the earliest possible moment.
(e) If requested by the managing underwriters, if any, or the Holders
of a majority in aggregate principal amount of the Purchased Notes being
sold in connection with an underwritten offering, (i) promptly incorporate
in a prospectus supplement or post-effective amendment such information as
the managing underwriters, if any, or such Holders reasonably request to be
included therein, (ii) make all required filings of such prospectus
supplement or such post-effective amendment as soon as practicable after
the Company received notification of the matters to be incorporated in such
prospectus supplement or post-effective amendment, and (iii) supplement or
make amendments to such Registration Statement.
(f) Furnish to each selling Holder who so requests and to counsel and
each managing underwriter, if any, without charge, one conformed copy of
the Registration Statement and each post-effective amendment thereto,
including financial statements and schedules, and, if requested, all
documents incorporated or deemed to be incorporated therein by reference
and all exhibits.
(g) Deliver to each selling Holder, their counsel and the underwriters,
if any, without charge, as many copies of each Prospectus (including each
form of preliminary prospectus) and each amendment or supplement thereto
and any documents incorporated by reference therein as such Persons may
reasonably request; and, subject to the last paragraph of this Section, the
Company hereby consents to the use of such Prospectus and each amendment or
supplement thereto by each of the selling holders of Purchased Notes and
the underwriters or agents, if any, in connection with the offering and
sale of the Purchased Notes covered by such Prospectus and any amendment or
supplement thereto until such time as the Company have notified the holders
to discontinue the use of such Prospectus.
(h) Prior to any public offering of Purchased Notes, to register or
qualify, and to cooperate with the selling
-16-
Holders, the underwriters, if any, and their respective counsel in
connection with the registration or qualification (or exemption from such
registration or qualification) of such Purchased Notes for offer and sale
under the securities or Blue Sky laws of such jurisdictions within the
United States as any selling Holder, or the managing underwriters
reasonably request in writing; provided that where Purchased Notes are
offered other than through an underwritten offering, the Company agree to
cause their counsel to perform Blue Sky investigations and file
registrations and qualifications required to be filed pursuant to this
subparagraph (h); keep each such registration or qualification (or
exemption therefrom) effective during the period such Registration
Statement is required to be kept effective and do any and all other acts or
things reasonably necessary or advisable to enable the disposition in such
jurisdictions of the Purchased Notes covered by the applicable Registration
Statement; provided, however, that the Company shall not be required to (A)
qualify generally to do business in any jurisdiction where it is not then
so qualified, (B) take any action that would subject it to general service
of process in any such jurisdiction where it is not then so subject or (C)
become subject to taxation in any such jurisdiction where it is not then so
subject.
(i) Cooperate with the selling Holders and the managing underwriters,
if any, to facilitate the timely preparation and delivery of certificates
representing Purchased Notes to be sold, which certificates shall not bear
any restrictive legends and shall be in a form eligible for deposit with
The Depository Trust Company ("DTC"); and enable such Purchased Notes to be
in such denominations and registered in such names as the managing
underwriters, if any, or selling Holders of Purchased Notes may reasonably
request at least two business days prior to any sale of Purchased Notes.
(j) Upon the occurrence of any event contemplated by subparagraph
(c)(v) or (vi), as promptly as practicable prepare and file with the
Commission, at the expense of the Company, a supplement or post-effective
amendment to the Registration Statement or a supplement to the related
Prospectus or any document incorporated or deemed to be incorporated
therein by reference, or file any other required document so that, as
thereafter delivered to the purchasers of the Purchased Notes being sold
thereunder, such Prospectus will not contain an untrue statement of a
-17-
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(k) Cooperate with each selling Holder covered by any Registration
Statement and each underwriter, if any, participating in the disposition of
such Purchased Notes and their respective counsel in connection with any
filings required to be made with the National Association of Securities
Dealers, Inc. (the "NASD").
(l) If requested by holders of a majority in aggregate principal amount
of Purchased Notes covered by such Registration Statement, enter into an
underwriting agreement in form, scope and substance as is customary in
underwritten offerings and take all such other actions as are reasonably
requested by the managing underwriters in order to expedite or facilitate
the registration or the disposition of such Purchased Notes, and in such
connection, (i) make such representations and warranties to the
underwriters, with respect to the business of the Company and its
subsidiaries, and the Registration Statement, Prospectus and documents, if
any, incorporated or deemed to be incorporated by reference therein, in
each case, in form, substance and scope as are customarily made by an
issuer to underwriters in underwritten offerings of securities similar to
the Registrable Security, and confirm the same if and when requested; (ii)
obtain opinions of counsel to the Company and updates thereof in form,
scope and substance reasonably satisfactory to the managing underwriters,
addressed to the underwriters covering the matters customarily covered in
opinions requested in underwritten offerings and such other matters as may
be reasonably requested by underwriters; (iii) obtain "cold comfort"
letters and updates thereof in form and substance reasonably satisfactory
to the managing underwriter or 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 business
acquired by the Company for which financial statements and financial data
are, or are required to be, included in the Registration Statement),
addressed to each of the underwriters such letters to be in customary form
and covering matters of the type customarily covered in "cold comfort"
letters in connection with underwritten offerings of securities similar to
the Purchased Notes; and (iv) if an underwriting agreement is en-
-18-
tered into, the same shall contain indemnification provisions and
procedures no less favorable generally than those set forth in Section 13
(or such other less favorable provisions and procedures acceptable to
Holders of a majority in aggregate principal amount of Purchased Notes
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.
(m) Make available for inspection by a representative of the selling
Holders, any underwriter participating in any such disposition of Purchased
Notes, if any, and any attorney or accountant or other agent retained by
any such representative of such selling Holders 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 their
subsidiaries, and cause the officers, directors and employees of the
Company and their subsidiaries to supply all information, in each case
reasonably requested by any such Inspector in connection with such
Registration Statement; provided, however, that any information that is
designated in writing by the Company, in good faith, as confidential at the
time of delivery of such information, shall be kept confidential by such
Inspector unless (i) disclosure of such information is required by court or
administrative order, (ii) disclosure of such information is otherwise
required by law, (iii) such information becomes generally available to the
public other than as a result of a disclosure or failure to safeguard by
such Inspector. Each selling Holder will be required to agree that
information obtained by it as a result of such inspections shall be deemed
confidential and shall not be used by it as the basis for any market
transactions in the securities of the Company unless and until such is made
generally available to the public. Each selling Holder will be required to
further agree that it will, upon learning that disclosure of any such
information is sought in a court or administrative tribunal of competent
jurisdiction, give notice to the Company and allow the Company to undertake
appropriate action to prevent disclosure of the information deemed
confidential at its expense and will use reasonable efforts to cooperate
with the Company in attempting to prevent such disclosure.
-19-
(n) Comply with all applicable rules and regulations of the Commission
and make generally available to its securityholders earnings statements
satisfying the provisions of Section 10(a) of the Securities Act and Rule
158 thereunder (or any similar rule promulgated under the Securities Act)
no later than 45 days after the end of any 12-month period (or 90 days
after the end of any 12-month period if such period is a fiscal year) (i)
commencing at the end of any fiscal quarter in which Purchased Notes are
sold to underwriters in a firm commitment or best efforts underwritten
offering and (ii) if not sold to underwriters in such an offering,
commencing on the first day of the first fiscal quarter of the Company
after the effective date of a Registration Statement, which statements
shall cover said 12-month periods.
(o) Use its reasonable best efforts to take all other steps reasonably
necessary to effect the registration of the Purchased Notes covered by a
Registration Statement contemplated hereby.
(p) The Company may require each selling Holder as to which any
registration is being effected to furnish to the Company such information
regarding such seller and the distribution of such Purchased Notes as the
Company may, from time to time, reasonably request in writing and to
otherwise cooperate in the preparation of the Registration Statement. The
Company may exclude from such registration the Purchased Notes of any
seller who unreasonably fails to furnish such information within a
reasonable time after receiving such request. If the identity of a seller
of Purchased Notes is to be disclosed in a registration statement, such
selling holder shall be permitted to include all information regarding such
seller as it shall reasonably request. At any time during the effectiveness
of any Registration Statement with respect to the Purchased Notes, any
selling Holder becomes aware of any change materially affecting the
accuracy of the information contained in the Registration Statement or
related Prospectus, such Holder will notify the Company of such change.
(q) Each Holder, upon receipt of any notice from the Company of the
happening of any event of the kind described in subparagraph (c), will
forthwith discontinue disposition of such Purchased Notes covered by such
Registration Statement or Prospectus, until such Holder's receipt of the
copies of the supplemented or amended Pro-
-20-
spectus contemplated by subparagraph (c), or until it is advised in writing
(the "Advice") by the Company that the use of the applicable Prospectus may
be resumed. In the event the Company shall give any such notice, the Shelf
Termination Date shall be extended by the number of days during such
periods from and including the date of the giving of such notice to and
including the date when each seller of Purchased Notes covered by such
Registration Statement shall have received the copies of the supplemented
or amended Prospectus contemplated by Section 6(c) or the Advice.
12. Registration Expenses. All fees and expenses, other than
underwriting discounts and commissions and transfer taxes, incident to the
performance of or compliance with this Agreement by the Company shall be borne
by the Company, jointly and severally, whether or not a Registration Statement
is filed or becomes effective, including, without limitation, (i) all
registration and filing fees (including, without limitation, (A) fees with
respect to filings required to be made with the NASD in connection with an
underwritten offering and (B) fees and expenses of compliance with state
securities or Blue Sky laws (including, without limitation, reasonable fees and
disbursements of counsel in connection with Blue Sky qualifications of the
Purchased Notes), (ii) printing expenses (including, without limitation,
expenses of printing certificates for Purchased Notes in a form eligible for
deposit with DTC and of printing prospectuses if the printing of prospectuses is
requested by the managing underwriters, if any, or by the Holders of a majority
in aggregate principal amount of the Purchased Notes included in the
Registration Statement), (iii) reasonable fees and disbursements of one counsel
for the Company and reasonable fees and disbursements of counsel for the sellers
of Purchased Notes, (iv) fees and disbursements of all independent certified
public accountants referred to herein (including, without limitation, the
expenses of any special audit and "cold comfort" letters required by or incident
to such performance), (v) the fees and expenses of any "qualified independent
underwriter" or other independent appraiser participating in an offering
pursuant to Rule 2720 of the Conduct Rules of the NASD, (vi) rating agency fees,
(vii) fees and expenses of all other Persons retained by the Company, (viii)
internal expenses of the Company (including, without limitation, all salaries
and expenses of officers and employees of the Company performing legal or
accounting duties) and (ix) the expense of any annual audit (collectively,
"Registration Expenses").
-21-
In connection with any Registration Statement hereunder or any
amendment thereto, the Company shall reimburse the holders of the Purchased
Notes being registered in such registration for the reasonable fees and
disbursements of not more than one counsel chosen by the Holders of a majority
in aggregate principal amount of the Purchased Notes to be included in such
Registration Statement and other reasonable out-of-pocket expenses of the
holders of Purchased Notes incurred in connection with the registration of the
Purchased Notes.
13. Indemnification and Contribution.
(a) (i) The Company agrees to hold harmless and indemnify the
Purchasers and any affiliated company and each officer, director, partner,
employee, affiliate or agent of the Purchasers or any of such affiliated
companies and any entity or person controlling (within the meaning of Section
20(a) of the Exchange Act) the Purchasers (collectively, the "Participants"),
from and against any and all Losses whatsoever (including, but not limited to,
any and all expenses incurred in investigating, preparing or defending against
any litigation or proceeding, commenced or threatened, or any claims whatsoever
whether or not resulting in any liability) arising out of or based upon any
untrue statement or alleged untrue statement of a material fact contained in the
Tender Offer Materials, in the Offering Memorandum, in any Registration
Statement or prospectus filed pursuant to Section 10 hereof or in any other
material used by the Company, or authorized by the Company for use, in
connection with the Tender Offer or the transactions contemplated thereby, or
arising out of or based upon the omission or alleged omission to state in any
such document a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading (other than statements or omissions made in reliance upon
information furnished by the Purchasers to the Company expressly for use
therein).
(ii) By its acceptance of the rights under Section 10 hereof, each
Holder agrees, severally and not jointly, to indemnify and hold harmless the
Company, their respective directors and officers and each person who controls
the Company within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act to the same extent as the foregoing indemnity from the
Company to each Holder, but only (i) with reference to information relating to
such Holder furnished to the Company in writing by or on behalf of such Holder
expressly for use in any Registration Statement or prospectus filed pursuant to
Section 10 hereof, any amendment or supplement
-22-
thereto, or any preliminary prospectus or (ii) with respect to any untrue
statement or representation made by such Holder in writing to the Company. The
liability of any Holder under this paragraph shall in no event exceed the
proceeds received by such Holder from sales of Mortgage Notes giving rise to
such obligations.
(b) The Company and the Holders agree that if any indemnification
sought by any indemnified person pursuant to Section 13(a) is unavailable for
any reason or insufficient to hold such indemnified person harmless, then the
Company and the Purchasers shall contribute to the Losses for which such
indemnification is held unavailable or insufficient in such proportion as is
appropriate to reflect the relative benefits received (or anticipated to be
received) by the Company, on the one hand, and the Holders, on the other hand,
in connection with the transactions contemplated by this Agreement or, if such
allocation is not permitted by applicable law, not only such relative benefits
but also the relative faults of the Company, on the one hand, and the Holders,
on the other hand, as well as any other equitable considerations, subject to the
limitation that in any event the aggregate contribution by the Holders to all
Losses with respect to which contribution is available hereunder shall not
exceed the proceeds received by such Holder from sales of Mortgage Notes giving
rise to such obligations. It is hereby agreed that the relative benefits of the
Company, on the one hand, and the Purchasers, on the other hand, with respect to
the Tender Offer and the transactions contemplated thereby shall be deemed to be
in the same proportion as (i) the total value paid or proposed to be paid to
holders of Notes pursuant to the Tender Offer (whether or not the Tender Offer
or such transactions are consummated) bears to (ii) the fees actually received
by the Purchasers from the Company in connection with its purchase hereunder.
(c) The foregoing rights to indemnity and contribution shall be in
addition to any other right which indemnified persons may have against an
indemnifying person at common law, under the Credit Agreement, the Dealer
Manager Agreement or otherwise. If any litigation or proceeding is brought
against any indemnified person in respect of which indemnification may be sought
against an indemnifying person pursuant to Section 13(a), such indemnified
person shall promptly notify such indemnifying person in writing of the
commencement of such litigation or proceeding, but the failure so to notify such
indemnifying person shall relieve such indemnifying person from any liability
which it may have hereunder only if, and to the extent that, such failure
results in the forfeiture by such in-
-23-
demnifying person of substantial rights and defenses, and will not in any event
relieve such indemnifying person from any other obligation or liability that it
may have to any indemnified person other than under this Agreement. In case any
such litigation or proceeding shall be brought against any indemnified person
and such indemnified person shall notify an indemnifying person in writing of
the commencement of such litigation or proceeding, such indemnifying person
shall be entitled to participate in such litigation or proceeding, and, after
written notice from such indemnifying person to such indemnified person, to
assume the defense of such litigation or proceeding with counsel of its choice
at its expense. Notwithstanding the election of an indemnifying person to assume
the defense of such litigation or proceeding, such indemnified person shall have
the right to employ separate counsel and to participate in the defense of such
litigation or proceeding, and such indemnifying person shall bear the reasonable
fees, costs and expenses of such separate counsel and shall pay such fees, costs
and expenses at least quarterly (provided that with respect to any single
litigation or proceeding or with respect to several litigations or proceedings
involving substantially similar legal claims, such indemnifying person shall not
be required to bear the fees, costs and expenses of more than one counsel for
all indemnified persons except where such indemnified person requires local
counsel, in which case such indemnifying person shall also be required to bear
the fees, costs and expenses of such local counsel) if (i) in the reasonable
judgment of such indemnified person the use of counsel chosen by the Company to
represent such indemnified person would present such counsel with a conflict of
interest, (ii) the defendants in, or targets of, any such litigation or
proceeding include both an Indemnified Person and the Company, and such
indemnified person shall have reasonably concluded that there may be legal
defenses available to it or to other Indemnified Persons which are different
from or additional to those available to the Company (in which case the Company
shall not have the right to direct the defense of such action on behalf of the
Indemnified Person), (iii) such indemnifying person shall not have employed
counsel satisfactory to such indemnified person, in the exercise of the
indemnified person's reasonable judgment, to represent such indemnified person
within a reasonable time after notice of the institution of such litigation or
proceeding or (iv) such indemnifying person shall authorize in writing such
indemnified person to employ separate counsel at the expense of such
indemnifying person. In any action or proceeding the defense of which an
indemnifying person assumes, the indemnified person shall have the right to
participate in such litigation and retain its own counsel at such indemnified
person's
-24-
own expense. The Company and each of you agree to notify the other promptly of
the assertion of any claim against it, any of its officers or directors or any
entity or person who controls it within the meaning of Section 20(a) of the
Exchange Act in connection with the transactions contemplated by this Agreement.
The foregoing indemnification commitments shall apply whether or not the
indemnified person is a formal party to such litigation or proceeding.
(d) The Company agrees to reimburse each Indemnified Person at least
quarterly for all expenses (including reasonable fees and disbursements of
counsel if authorized pursuant to the preceding paragraph (c)) incurred by such
Indemnified Person in connection with investigating, preparing for, defending or
providing evidence (including appearing as a witness) with respect to any
action, claim, investigation, inquiry, arbitration or other proceeding referred
to in this Section whether or not in connection with pending or threatened
litigation in which any Indemnified Person is a party.
(e) Each indemnifying person agrees that it will not, without the
indemnified person's prior written consent (which consent shall not be
unreasonably withheld or delayed), settle, compromise or consent to the entry of
any judgment in any pending or threatened claim, action or proceeding in respect
of which indemnification may be sought hereunder unless such settlement,
compromise or consent includes an unconditional release of each indemnified
person from all liability arising out of such claim, action or proceeding. No
indemnified person seeking indemnification under this Agreement shall, without
such indemnifying person's prior written consent (which consent shall not be
unreasonably withheld or delayed), settle, compromise or consent to the entry of
any judgment in any pending or threatened claim, action or proceeding in respect
of which indemnification may be sought hereunder.
(f) In addition to the foregoing indemnity, the Company agrees that the
indemnity set forth in Section 10.4 of the Credit Agreement will apply to the
Purchasers to the same extent and in the same manner in respect of the
transactions contemplated hereby as would be the case if such Purchaser were a
Lender under the Credit Agreement.
14. Purchasers' Representation and Warranties. Each Purchaser
represents and warrants to, and agrees with, the Company:
-25-
(a) Such Purchaser is a QIB with such knowledge and experience in
financial and business matters as is necessary in order to evaluate the merits
and risks of an investment in the Mortgage Notes.
(b) Such Purchaser (i) is not acquiring the Mortgage Notes with a view
to any distribution thereof or with any present intention of offering or selling
any of the Mortgage Notes in a transaction that would violate the Securities Act
or the securities laws of any state of the United States or any other applicable
jurisdiction and (ii) will be reoffering and reselling the Mortgage Notes only
to (A) QIBs in reliance on the exemption from the registration requirements of
the Securities Act provided by Rule 144A, (B) to non-U.S. Persons in offshore
transactions in compliance upon Regulation S under the Securities Act and (C) to
"accredited investors" within the meaning of Rule 501(a)(1), (2), (3) or (7)
under the Securities Act that are institutional investors acquiring the Mortgage
Notes for their own account or for the account of such an institutional
accredited investor, in each case in a minimum principal amount of $250,000, for
investment purposes and not with a view to or for offer or resale in connection
with any distribution in violation of the Securities Act (such persons described
in clauses (A), (B) and (C) being hereafter referred to as "Eligible
Purchasers").
(c) Such Purchaser agrees that no form of general solicitation or
general advertising (within the meaning of Regulation D under the Securities
Act) has been or will be used by such Purchaser or any of its representatives in
connection with the offer and sale of the Mortgage Notes pursuant hereto,
including, but not limited to, articles, notices or other communications
published in any newspaper, magazine or similar medium or broadcast over
television or radio, or any seminar or meeting whose attendees have been invited
by any general solicitation or general advertising.
(d) From and after the date hereof, such Purchaser agrees that such
Purchaser will solicit offers to buy the Mortgage Notes only from, and will
offer to sell the Mortgage Notes only to, Eligible Purchasers only for so long
as they remain legended securities. Such Purchaser further agrees that it will
offer to sell the Mortgage Notes only to, and will solicit offers to buy the
Mortgage Notes only from Eligible Purchasers to whom a notice has been given
that states that such Eligible Purchaser agrees by its purchase and acceptance
of Mortgage Notes that (A) such Eligible Purchaser will offer, sell or otherwise
transfer such security, prior to the date (the "resale
-26-
restriction termination date") which is two years after the later of the date of
original assignment to the Purchasers and the last date on which the Company or
any affiliate of the Company was the owner of this security (or any predecessor
of such security), only (a) to the Company, (b) pursuant to a registration
statement that has been declared effective under the Securities Act, (c) for so
long as the Mortgage Notes are eligible for resale pursuant to Rule 144A, to a
person it reasonably believes is a "qualified institutional buyer" as defined in
Rule 144A under the Securities Act that purchases for its own account or for the
account of a qualified institutional buyer to whom notice is given that the
transfer is being made in reliance on Rule 144A, (d) in offshore transactions to
non-U.S. persons in compliance with Regulation S under the Securities Act, (e)
to an institutional "accredited investor" within the meaning of Rule 501(a)(1),
(2), (3) or (7) under the Securities Act that is an institutional investor
acquiring the security for its own account or for the account of such an
institutional accredited investor, in each case in a minimum principal amount of
the securities of $250,000, for investment purposes and not with a view to or
for offer or sale in connection with any distribution in violation of the
Securities Act and has delivered a representation letter in satisfactory form to
the Company or (f) pursuant to any other available exemption from the
registration requirements of the Securities Act, subject to clauses (d), (e) or
(f) to require the delivery of an opinion of counsel, certification and/or other
information satisfactory to each of them and (B) they will deliver to each
person to whom such Mortgage Notes or an interest therein is transferred a
notice substantially to the effect of the foregoing.
(e) Such Purchaser and its affiliates or any person acting on its
behalf have not engaged or will not engage in any directed selling efforts
within the meaning of Regulation S with respect to the Mortgage Notes.
15. Termination. This Agreement shall be terminated if the Credit
Agreement shall have been terminated or the Tender Offer shall have been
consummated without an Election having been made.
16. Notices. Notice given pursuant to any of the provisions of this
Agreement shall be in writing and shall be mailed or delivered (a) to the
Company, as set forth in the Credit Agreement; (b) to the Purchasers, as set
forth in the Credit Agreement; and (c) to Holders, at their addresses as
reflected in any securities register. Any notice given hereunder
-27-
may be made by telecopier or telephone, but if so made shall be subsequently
confirmed in writing.
17. Survival. The respective representations, warranties, agreements,
covenants, indemnities and other statements of the Company and its officers and
the Purchasers set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement shall remain in full force and effect,
regardless of (i) any investigation made by or on behalf of the Company, any of
its officers or directors, the Purchasers or any of its officers, directors,
employees and agents or any controlling person referred to in Section 10, and
(ii) consummation of the Tender Offer or any of the other Transactions. The
respective agreements, covenants, indemnities and other statements set forth in
Section 8 shall remain in full force and effect, regardless of any termination
or cancellation of this Agreement.
18. Applicable Law. The validity and interpretation of this Agreement,
and the terms and conditions set forth herein, shall be governed by and
construed in accordance with the laws of the State of New York.
19. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same instrument.
20. Successors and Assigns. This Agreement shall inure to the benefit
of and shall be binding upon the Purchasers, the Company and their respective
successors and legal representatives, and nothing expressed or mentioned in this
Agreement is intended or shall be construed to give any other person any legal
or equitable right, remedy or claim under or in respect of this Agreement, or
any provisions herein contained, this Agreement and all conditions and
provisions hereof being intended to be and being for the sole and exclusive
benefit of such persons and for the benefit of no other person except that the
indemnities and provisions contained in Sections 11, 12 and 13 shall also be for
the benefit of any other Person referred to therein. Notwithstanding anything
herein to the contrary, the Purchasers will be free to sell Purchased Notes,
subject to applicable Securities Act restrictions. The Purchasers may assign
their rights under any of Sections 6 (subject to the limitations set forth
herein), 11 and 12 to a Permitted Assignee. Any assignment of rights under
Sections 11, 12 and 13 (to the extent relating to Sections 11 and 12) shall be
automatic and coincident to the transfer of any Purchased Notes provided that
-28-
a Holder's rights under Section 13 shall be limited in all cases to matters
arising out of or based upon a Registration Statement or prospectus filed
pursuant to Section 10. A "Permitted Assignee" shall mean a Person to whom
Purchased Notes are being sold in compliance with applicable securities law
restrictions and, in the case of Section 6, is also a Lender under the Credit
Agreement.
-29-
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to us a counterpart hereof, whereupon this
instrument, along with all counterparts, will become a binding agreement among
Purchasers and the Company in accordance with its terms.
Very truly yours,
REPUBLIC ENGINEERED STEELS, INC.
By: /s/ Xxxxx Xxxxxxx
--------------------------------
Name: Xxxxx Xxxxxxx
Title: Secretary
Confirmed and accepted as of
the date first above written:
CHASE SECURITIES INC.
By: /s/ Xxxxxxx Xxxxxx
--------------------------------
Name: Xxxxxxx Xxxxxx
Title: Vice President
XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION
By: /s/ Xxxxxxx Xxxxxxx
--------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Vice President
BANKBOSTON XXXXXXXXX XXXXXXXX INC.
By: /s/ Xxxxxxxx X. Xxxxxx
--------------------------------
Name: Xxxxxxxx X. Xxxxxx
Title: Director
