EXHIBIT 4.4
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REGISTRATION RIGHTS AGREEMENT
DATED AS OF DECEMBER 29, 2005
BY AND AMONG
NATIONAL COAL CORP.,
AS ISSUER,
THE GUARANTORS
LISTED ON THE SIGNATURE PAGES HERETO
AND
XXXXXXXXX & COMPANY, INC.,
THE INITIAL PURCHASER
$55,000,000 10.5% SENIOR SECURED NOTES DUE 2010
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TABLE OF CONTENTS
PAGE
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SECTION 1. DEFINITIONS..................................................1
SECTION 2. EXCHANGE OFFER...............................................4
SECTION 3. SHELF REGISTRATION...........................................7
SECTION 4. LIQUIDATED DAMAGES...........................................8
SECTION 5. REGISTRATION PROCEDURES.....................................10
SECTION 6. REGISTRATION EXPENSES.......................................17
SECTION 7. INDEMNIFICATION.............................................18
SECTION 8. RULES 144 AND 144A..........................................21
SECTION 9. UNDERWRITTEN REGISTRATIONS..................................21
SECTION 10. MISCELLANEOUS...............................................22
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REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement, dated as of December 29, 2005 (this
"AGREEMENT"), is entered into by and between National Coal Corp., a Florida
corporation, (the "ISSUER"), the guarantors listed on the signature pages hereto
(the "GUARANTORS") and Xxxxxxxxx & Company, Inc. (the "INITIAL PURCHASER").
This Agreement is entered into in connection with the Purchase
Agreement, dated as of December 22, 2005, by and among the Issuer, the
Guarantors and the Initial Purchaser (the "PURCHASE AGREEMENT"), relating to the
offering of 55,000 Units (the "UNITS") consisting of $55,000,000 aggregate
principal amount of the Company's 10.5% Senior Secured Notes due 2010 (the
"NOTES") and 55,000 Common Stock Purchase Warrants (the "WARRANTS"). Each Unit
consists of (A) $1,000 in principal amount of Notes and (B) one Warrant, each
Warrant representing the right to purchase 31.5024 shares of Common Stock of the
Company, at an exercise price of $8.50 per share, subject to adjustment. The
execution and delivery of this Agreement is a condition to the Initial
Purchaser's obligation to purchase the Units under the Purchase Agreement.
The parties hereby agree as follows:
Section 1. DEFINITIONS.
As used in this Agreement, the following terms shall have the following
meanings:
"ACTION" shall have the meaning set forth in Section 7(c) hereof.
"ADVICE" shall have the meaning set forth in Section 5 hereof.
"AGREEMENT" shall have the meaning set forth in the first introductory
paragraph hereto.
"APPLICABLE PERIOD" shall have the meaning set forth in Section 2(b)
hereof.
"BOARD OF DIRECTORS" shall have the meaning set forth in Section 5
hereof.
"BUSINESS DAY" shall mean a day that is not a Legal Holiday.
"COMMISSION" shall mean the Securities and Exchange Commission.
"DAY" shall mean a calendar day.
"DAMAGES PAYMENT DATE" shall have the meaning set forth in Section 4(b)
hereof.
"DELAY PERIOD" shall have the meaning set forth in Section 5 hereof.
"EFFECTIVENESS PERIOD" shall have the meaning set forth in Section 3(b)
hereof.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission promulgated thereunder.
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"EXCHANGE NOTES" shall have the meaning set forth in Section 2(a)
hereof.
"EXCHANGE OFFER" shall have the meaning set forth in Section 2(a)
hereof.
"EXCHANGE OFFER REGISTRATION STATEMENT" shall have the meaning set
forth in Section 2(a) hereof.
"FILING DATE" shall have the meaning set forth in Section 3(a) hereof.
"HOLDER" shall mean any holder of a Registrable Note or Registrable
Notes.
"INDENTURE" shall mean the Indenture, dated as of December 29, 2005, by
and between the Issuer and Xxxxx Fargo Bank, National Association, as trustee,
pursuant to which the Notes are being issued, as amended or supplemented from
time to time in accordance with the terms thereof.
"INITIAL PURCHASER" shall have the meaning set forth in the first
introductory paragraph hereof.
"INSPECTORS" shall have the meaning set forth in Section 5(n) hereof.
"ISSUE DATE" shall mean December 29, 2005, the date of original
issuance of the Notes.
"ISSUER" shall have the meaning set forth in the introductory paragraph
hereto and shall also include the Issuer's permitted successors and assigns.
"LEGAL HOLIDAY" shall mean a Saturday, a Sunday or a day on which
banking institutions in New York, New York are required by law, regulation or
executive order to remain closed.
"LIQUIDATED DAMAGES" shall have the meaning set forth in Section 4(a)
hereof.
"LOSSES" shall have the meaning set forth in Section 7(a) hereof.
"NASD" shall have the meaning set forth in Section 5(s) hereof.
"NOTES" shall have the meaning set forth in the second introductory
paragraph hereto.
"PARTICIPANT" shall have the meaning set forth in Section 7(a) hereof.
"PARTICIPATING BROKER-DEALER" shall have the meaning set forth in
Section 2(b) hereof.
"PERSON" shall mean an individual, corporation, partnership, joint
venture association, joint stock company, trust, unincorporated limited
liability company, government or any agency or political subdivision thereof or
any other entity.
"PRIVATE EXCHANGE" shall have the meaning set forth in Section 2(b)
hereof.
"PRIVATE EXCHANGE NOTES" shall have the meaning set forth in Section
2(b) hereof.
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"PURCHASE AGREEMENT" shall have the meaning set forth in the second
introductory paragraph hereof.
"PROSPECTUS" shall mean the prospectus included in any Registration
Statement (including, without limitation, any prospectus subject to completion
and a prospectus that includes any information previously omitted from a
prospectus filed as part of an effective registration statement in reliance upon
Rule 430A promulgated under the Securities Act), as amended or supplemented by
any prospectus supplement, and all other amendments and supplements to the
Prospectus, including post-effective amendments, and all material incorporated
by reference or deemed to be incorporated by reference in such Prospectus.
"RECORDS" shall have the meaning set forth in Section 5(n) hereof.
"REGISTRABLE NOTES" shall mean each Note upon its original issuance and
at all times subsequent thereto, each Exchange Note as to which Section
2(c)(iii) hereof is applicable upon original issuance and at all times
subsequent thereto and each Private Exchange Note upon original issuance thereof
and at all times subsequent thereto, in each case until (i) a Registration
Statement (other than, with respect to any Exchange Note as to which Section
2(c)(iii) hereof is applicable, the Exchange Offer Registration Statement)
covering such Note, Exchange Note or Private Exchange Note has been declared
effective by the Commission and such Note, Exchange Note or such Private
Exchange Note, as the case may be, has been disposed of in accordance with such
effective Registration Statement, (ii) such Note has been exchanged pursuant to
the Exchange Offer for an Exchange Note or Exchange Notes that may be resold
without restriction under state and federal securities laws, (iii) such Note,
Exchange Note or Private Exchange Note, as the case may be, ceases to be
outstanding or (iv) such Note, Exchange Note or Private Exchange Note has been
sold in compliance with Rule 144 or is salable pursuant to Rule 144(k) (or any
similar provision then in force other than Rule 144A).
"REGISTRATION DEFAULT" shall have the meaning set forth in Section 4(a)
hereof.
"REGISTRATION STATEMENT" shall mean any appropriate registration
statement of the Issuer covering any of the Registrable Notes filed with the
Commission under the Securities Act, and all amendments and supplements to any
such Registration Statement, including post-effective amendments, in each case
including the Prospectus contained therein, all exhibits thereto and all
material incorporated by reference therein.
"REQUESTING PARTICIPATING BROKER-DEALER" shall have the meaning set
forth in Section 2(b) hereof.
"RULE 144" shall mean Rule 144 promulgated under the Securities Act, as
such Rule may be amended from time to time, or any similar rule (other than Rule
144A) or regulation hereafter adopted by the Commission providing for offers and
sales of securities made in compliance therewith resulting in offers and sales
by subsequent holders that are not affiliates of an issuer of such securities
being free of the registration and prospectus delivery requirements of the
Securities Act.
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"RULE 144A" shall mean Rule 144A promulgated under the Securities Act,
as such Rule may be amended from time to time, or any similar rule (other than
Rule 144) or regulation hereafter adopted by the Commission.
"RULE 415" shall mean Rule 415 promulgated under the Securities Act, as
such Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the Commission.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended, and
the rules and regulations of the Commission promulgated thereunder.
"SHELF FILING EVENT" shall have the meaning set forth in Section 2(c)
hereof.
"SHELF REGISTRATION" shall have the meaning set forth in Section 3(a)
hereof.
"SHELF REGISTRATION STATEMENT" shall mean a Registration Statement
filed in connection with a Shelf Registration.
"TIA" shall mean the Trust Indenture Act of 1939, as amended.
"TRUSTEE" shall mean the trustee under the Indenture and the trustee
(if any) under any indenture governing the Exchange Notes and Private Exchange
Notes.
"UNDERWRITTEN REGISTRATION OR UNDERWRITTEN OFFERING" shall mean a
registration in which securities of the Issuer are sold to an underwriter for
reoffering to the public.
Section 2. EXCHANGE OFFER.
(a) To the extent not prohibited by any applicable law or
applicable interpretation of the Commission, the Issuer shall
(i) file a Registration Statement (the "EXCHANGE OFFER
REGISTRATION STATEMENT") with the Commission on an appropriate
registration form with respect to a registered offer (the
"EXCHANGE OFFER") to exchange any and all of the Registrable
Notes for a like aggregate principal amount of notes (the
"EXCHANGE NOTES") that are identical in all material respects
to the Notes (except that the Exchange Notes shall not contain
terms with respect to transfer restrictions or Liquidated
Damages upon a Registration Default), (ii) use its
commercially reasonable efforts to cause the Exchange Offer
Registration Statement to be declared effective under the
Securities Act within 240 days after the Issue Date and (iii)
use its commercially reasonable efforts to consummate the
Exchange Offer within 45 days after the date on which the
Exchange Offer Registration Statement is declared effective.
Upon the Exchange Offer Registration Statement being declared
effective by the Commission, the Issuer will offer the
Exchange Notes in exchange for surrender of the Notes. The
Issuer shall keep the Exchange Offer open for not less than 20
Business Days (or longer if required by applicable law) after
the date notice of the Exchange Offer is mailed to Holders.
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Each Holder that participates in the Exchange Offer will be required to
represent to the Issuer in writing that (i) any Exchange Notes to be received by
it will be acquired in the ordinary course of its business, (ii) it has no
arrangement or understanding with any Person to participate in the distribution
(within the meaning of the Securities Act) of the Exchange Notes in violation of
the provisions of the Securities Act or, if it is an affiliate, it will comply
with the registration and prospectus delivery requirements of the Securities Act
to the extent applicable, (iii) if such Holder is not a broker-dealer, it is not
engaged in, and does not intend to engage in, a distribution of Exchange Notes,
(iv) if such Holder is a broker-dealer that will receive Exchange Notes for its
own account in exchange for Notes that were acquired as a result of
market-making or other trading activities, it will comply with the applicable
provisions of the Securities Act in connection with any resale of such Exchange
Notes, (v) such Holder has full power and authority to transfer the Notes in
exchange for the Exchange Notes and that the Issuer will acquire good and
unencumbered title thereto free and clear of any liens, restrictions, charges or
encumbrances and not subject to any adverse claims; and (vi) such Holder is not
our "affiliate" (as defined in Rule 405 promulgated under the Securities Act).
(b) The Issuer and the Initial Purchaser acknowledge that the
staff of the Commission has taken the position that any
broker-dealer that elects to exchange Notes that were acquired
by such broker-dealer for its own account as a result of
market-making or other trading activities for Exchange Notes
in the Exchange Offer (a "PARTICIPATING BROKER-DEALER") may be
deemed to be an "underwriter" within the meaning of the
Securities Act and must deliver a prospectus meeting the
requirements of the Securities Act in connection with any
resale of such Exchange Notes (other than a resale of an
unsold allotment resulting from the original offering of the
Notes).
The Issuer and the Initial Purchaser also acknowledge that the staff of
the Commission has taken the position that if the Prospectus contained in the
Exchange Offer Registration Statement includes a plan of distribution containing
a statement to the above effect and the means by which Participating
Broker-Dealers may resell the Exchange Notes, without naming the Participating
Broker-Dealers or specifying the amount of Exchange Notes owned by them, such
Prospectus may be delivered by Participating Broker-Dealers to satisfy their
prospectus delivery obligations under the Securities Act in connection with
resales of Exchange Notes for their own accounts, so long as the Prospectus
otherwise meets the requirements of the Securities Act.
In light of the foregoing, if requested by a Participating
Broker-Dealer (a "REQUESTING PARTICIPATING BROKER-DEALER"), the Issuer agrees to
use its commercially reasonable efforts to keep the Exchange Offer Registration
Statement continuously effective for a period not to exceed 180 days after the
date on which the Exchange Registration Statement is declared effective, or such
longer period if extended pursuant to the last paragraph of Section 5 hereof
(such period, the "APPLICABLE PERIOD"), or such earlier date as all Requesting
Participating Broker-Dealers shall have notified the Issuer in writing that such
Requesting Participating Broker-Dealers have resold all Exchange Notes acquired
in the Exchange Offer. The Issuer shall include a plan of distribution in such
Exchange Offer Registration Statement that meets the requirements set forth in
the preceding paragraph.
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If, prior to consummation of the Exchange Offer, the Initial Purchaser
or any Holder, as the case may be, holds any Notes 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 if any Holder is not entitled to
participate in the Exchange Offer, the Issuer upon the request of the Initial
Purchaser or any such Holder, as the case may be, shall simultaneously with the
delivery of the Exchange Notes in the Exchange Offer, issue and deliver to the
Initial Purchaser or any such Holder, as the case may be, in exchange (the
"PRIVATE EXCHANGE") for such Notes held by the Initial Purchaser or any such
Holder, as the case may be, a like principal amount of notes (the "PRIVATE
EXCHANGE NOTES") of the Issuer that are identical in all material respects to
the Exchange Notes except that the Private Exchange Notes may be subject to
restrictions on transfer and bear a legend to such effect. The Private Exchange
Notes shall be issued pursuant to the same indenture as the Exchange Notes and
bear the same CUSIP number as the Exchange Notes.
For each Note surrendered in the Exchange Offer, the Holder will
receive an Exchange Note having a principal amount equal to that of the
surrendered Note. Interest on each Exchange Note and Private Exchange Note
issued pursuant to the Exchange Offer and in the Private Exchange will accrue
from the last interest payment date on which interest was paid on the Notes
surrendered in exchange therefor or, if no interest has been paid on the Notes,
from the Issue Date.
Upon consummation of the Exchange Offer in accordance with this Section
2, the Issuer shall have no further registration obligations other than the
Issuer's continuing registration obligations with respect to (i) Private
Exchange Notes, (ii) Exchange Notes held by Participating Broker-Dealers and
(iii) Notes or Exchange Notes as to which clause (c)(iii) of this Section 2
applies.
In connection with the Exchange Offer, the Issuer shall:
(1) mail or cause to be mailed to each Holder entitled to
participate in the Exchange Offer a copy of the
Prospectus forming part of the Exchange Offer
Registration Statement, together with an appropriate
letter of transmittal and related documents;
(2) utilize the services of a depositary for the Exchange
Offer with an address in the Borough of Manhattan,
The City of New York;
(3) permit Holders to withdraw tendered Notes at any time
prior to the close of business, New York time, on the
last Business Day on which the Exchange Offer shall
remain open; and
(4) otherwise comply in all material respects with all
applicable laws, rules and regulations.
As soon as practicable after the close of the Exchange Offer and the
Private Exchange, if any, the Issuer shall:
(1) accept for exchange all Notes validly tendered and
not validly withdrawn by the Holders pursuant to the
Exchange Offer and the Private Exchange, if any;
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(2) deliver or cause to be delivered to the Trustee for
cancellation all Notes so accepted for exchange; and
(3) cause the Trustee to authenticate and deliver
promptly to each such Holder of Notes, Exchange Notes
or Private Exchange Notes, as the case may be, equal
in principal amount to the Registrable Notes of such
Holder so accepted for exchange.
The Exchange Offer and the Private Exchange shall not be subject to any
conditions, other than that (i) the Exchange Offer or Private Exchange, as the
case may be, does not violate applicable law or any applicable interpretation of
the staff of the Commission, (ii) no action or proceeding shall have been
instituted or threatened in any court or by any governmental agency which might
materially impair the ability of the Issuer to proceed with the Exchange Offer
or the Private Exchange, and no material adverse development shall have occurred
in any existing action or proceeding with respect to the Issuer and (iii) all
governmental approvals shall have been obtained, which approvals the Issuer
deems necessary for the consummation of the Exchange Offer or Private Exchange.
The Exchange Notes and the Private Exchange Notes shall be issued under
(i) the Indenture or (ii) an indenture identical in all material respects to the
Indenture (in either case, with such changes as are necessary to comply with any
requirements of the Commission to effect or maintain the qualification thereof
under the TIA) and which, in either case, has been qualified under the TIA and
shall provide that (a) the Exchange Notes shall not be subject to the transfer
restrictions set forth in the Indenture and (b) the Private Exchange Notes shall
be subject to the transfer restrictions set forth in the Indenture. The
Indenture or such indenture shall provide that the Exchange Notes, the Private
Exchange Notes and the Notes shall vote and consent together on all matters as
one class and that none of the Exchange Notes, the Private Exchange Notes or the
Notes will have the right to vote or consent as a separate class on any matter.
(c) In the event that (i) any changes in law or the applicable
interpretations of the staff of the Commission do not permit
the Issuer to effect the Exchange Offer, (ii) for any reason
the Exchange Offer Registration Statement is not declared
effective under the Securities Act within 240 days of the
Issue Date or the Exchange Offer is not consummated 45 days
thereafter, (iii) any Holder, other than the Initial
Purchaser, is prohibited by law or the applicable
interpretations of the staff of the Commission from
participating in the Exchange Offer or does not receive
Exchange Notes on the date of the exchange that may be sold
without restriction under state and federal securities laws
(other than due solely to the status of such holder as an
affiliate of the Issuer within the meaning of the Securities
Act) or (iv) the Initial Purchaser so requests with respect to
Notes or Private Exchange Notes that have, or that are
reasonably likely to be determined to have, the status of
unsold allotments in an initial distribution (each such event
referred to in clauses (i) through (iv) of this sentence, a
"SHELF FILING EVENT"), then the Issuer shall file a Shelf
Registration pursuant to Section 3 hereof.
Section 3. SHELF REGISTRATION.
If at any time a Shelf Filing Event shall occur, then:
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(a) The Issuer shall file with the Commission a Registration
Statement for an offering to be made on a continuous basis
pursuant to Rule 415 covering all of the Registrable Notes not
exchanged in the Exchange Offer, Private Exchange Notes and
Exchange Notes as to which Section 2(c)(iii) is applicable
(the "SHELF REGISTRATION"). The Issuer shall use its
commercially reasonable efforts to file with the Commission
the Shelf Registration as promptly as practicable but in any
event within 30 days of the Shelf Filing Event (the "FILING
DATE"). The Shelf Registration shall be on Form S-1 or another
appropriate form permitting registration of such Registrable
Notes for resale by Holders in the manner or manners
designated by them (including, without limitation, one or more
underwritten offerings). The Issuer shall not permit any
securities other than the Registrable Notes to be included in
the Shelf Registration.
(b) The Issuer shall use its commercially reasonable efforts (x)
to cause the Shelf Registration to be declared effective under
the Securities Act on or prior to 90 days after the Filing
Date and (y) to keep the Shelf Registration continuously
effective under the Securities Act for the period ending on
the date which is two years from the Issue Date, subject to
extension pursuant to the penultimate paragraph of Section 5
hereof (the "EFFECTIVENESS PERIOD"), or such shorter period
ending when all Registrable Notes covered by the Shelf
Registration have been sold in the manner set forth and as
contemplated in the Shelf Registration; PROVIDED, HOWEVER,
that (i) the Effectiveness Period in respect of the Shelf
Registration shall be extended to the extent required to
permit dealers to comply with the applicable prospectus
delivery requirements of Rule 174 under the Securities Act and
as otherwise provided herein and (ii) the Issuer may suspend
the effectiveness of the Shelf Registration Statement by
written notice to the Holders solely as a result of the filing
of a post-effective amendment to the Shelf Registration
Statement to incorporate annual audited financial information
with respect to the Issuer where such post-effective amendment
is not yet effective and needs to be declared effective to
permit Holders to use the related Prospectus, provided that
the Effectiveness Period in respect of the Shelf Registration
shall be extended by such number of days for which
effectiveness is suspended under this clause (ii).
(c) SUPPLEMENTS AND AMENDMENTS. The Issuer agrees to supplement or
make amendments to the Shelf Registration Statement as and
when required by the rules, regulations or instructions
applicable to the registration form used for such Shelf
Registration Statement or by the Securities Act or rules and
regulations thereunder for shelf registration, or if
reasonably requested by the Holders of a majority in aggregate
principal amount of the Registrable Notes covered by such
Registration Statement or by any underwriter of such
Registrable Notes.
Section 4. LIQUIDATED DAMAGES.
(a) The Issuer and the Initial Purchaser agree that the Holders
will suffer damages if the Issuer fails to fulfill its
obligations under Section 2 or Section 3 hereof and
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that it would not be feasible to ascertain the extent of such
damages with precision. Accordingly, the Issuer agrees that
if:
(i) the Exchange Offer Registration Statement is not
declared effective on or prior to the 240th day
following the Issue Date or, if that day is not a
Business Day, the next day that is a Business Day;
(ii) the Exchange Offer is not consummated on or prior to
the 45th day following the date on which the Exchange
Offer Registration Statement is declared effective;
(iii) the Shelf Registration Statement is required to be
filed but is not filed by the Filing Date;
(iv) the Shelf Registration Statement is required to be
filed but is not declared effective by the 90 days
after the Filing Date, or, if either such day is not
a Business Day, the next day that is a Business Day
or is declared effective by such date but thereafter
ceases to be effective or usable, except if the Shelf
Registration ceases to be effective or usable as
specifically permitted by the penultimate paragraph
of Section 5 hereof; or
(v) the Shelf Registration does not remain continuously
effective for the Effectiveness Period (subject to
any Delay Periods)
(each such event referred to in clauses (i) through (v) a "REGISTRATION
DEFAULT"), liquidated damages in the form of additional cash interest
("LIQUIDATED DAMAGES") will accrue on the affected Notes and the affected
Exchange Notes, as applicable. The rate of Liquidated Damages will be 0.25% per
annum for the first 90-day period immediately following the occurrence of a
Registration Default, increasing by an additional 0.25% per annum with respect
to each subsequent 90-day period up to a maximum amount of additional interest
of 1.00% per annum, from and including the date on which any such Registration
Default shall occur to, but excluding, the earlier of (1) the date on which all
Registration Defaults have been cured or (2) the date on which all the Notes and
Exchange Notes otherwise become freely transferable by Holders other than
affiliates of the Issuer without further registration under the Securities Act.
Notwithstanding the foregoing, (1) the amount of Liquidated Damages
payable shall not increase more than by the foregoing rates because more than
one Registration Default has occurred and is pending and (2) a Holder of Notes
or Exchange Notes who is not entitled to the benefits of the Shelf Registration
Statement (I.E., such Holder has not elected to include information) shall not
be entitled to Liquidated Damages with respect to a Registration Default that
pertains to the Shelf Registration Statement.
(b) So long as Notes remain outstanding, the Issuer shall notify
the Trustee within five Business Days after each and every
date on which an event occurs in respect of which Liquidated
Damages is required to be paid. Any amounts of Liquidated
Damages due pursuant to clauses (a)(i), (a)(ii) or (a)(iii) of
this Section 4 will be payable in cash semi-annually on each
June 15 and December 15 (each a "DAMAGES PAYMENT DATE"),
commencing with the first such date occurring after
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any such Liquidated Damages commence to accrue, to Holders to
whom regular interest is payable on such Damages Payment Date
with respect to Notes that are Registrable Securities. The
amount of Liquidated Damages for Registrable Notes will be
determined by multiplying the applicable rate of Liquidated
Damages by the aggregate principal amount of all such
Registrable Notes outstanding on the Damages Payment Date
following such Registration Default in the case of the first
such payment of Liquidated Damages with respect to a
Registration Default (and thereafter at the next succeeding
Damages Payment Date until the cure of such Registration
Default), multiplied by a fraction, the numerator of which is
the number of days such Liquidated Damages rate was applicable
during such period (determined on the basis of a 360-day year
comprised of twelve 30-day months and, in the case of a
partial month, the actual number of days elapsed), and the
denominator of which is 360.
(c) The payment of Liquidated Damages shall be the exclusive
remedy for Registration Default.
Section 5. REGISTRATION PROCEDURES.
In connection with the filing of any Registration Statement pursuant to
Section 2 or 3 hereof, the Issuer shall effect such registrations to permit the
sale of the securities covered thereby in accordance with the intended method or
methods of disposition thereof, and pursuant thereto and in connection with any
Registration Statement filed by the Issuer hereunder, the Issuer shall:
(a) Prepare and file with the Commission the Registration
Statement or Registration Statements prescribed by Section 2
or 3 hereof, and use its commercially reasonable efforts to
cause each such Registration Statement to become effective and
remain effective as provided herein; PROVIDED, HOWEVER, that
if (1) such filing is pursuant to Section 3 hereof, or (2) a
Prospectus contained in the Exchange Offer Registration
Statement filed pursuant to Section 2 hereof is required to be
delivered under the Securities Act by any Participating
Broker-Dealer who seeks to sell Exchange Notes during the
Applicable Period relating thereto, before filing any
Registration Statement or Prospectus or any amendments or
supplements thereto, the Issuer shall furnish to and afford
the Holders of the Registrable Notes covered by such
Registration Statement or each such Participating
Broker-Dealer, as the case may be, its counsel (if such
counsel is known to the Issuer) and the managing underwriters,
if any, a reasonable opportunity to review copies of all such
documents (including copies of any documents to be
incorporated by reference therein and all exhibits thereto)
proposed to be filed (in each case at least five Business Days
prior to such filing or such later date as is reasonable under
the circumstances). The Issuer shall not file any Registration
Statement or Prospectus or any amendments or supplements
thereto if the Holders of a majority in aggregate principal
amount of the Registrable Notes covered by such Registration
Statement, or any such Participating Broker-Dealer, as the
case may be, its counsel, or the managing underwriters, if
any, shall reasonably object on a timely basis.
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(b) Prepare and file with the Commission such amendments and
post-effective amendments to each Shelf Registration Statement
or Exchange Offer Registration Statement, as the case may be,
as may be necessary to keep such Registration Statement
continuously effective for the Effectiveness Period or the
Applicable Period, as the case may be; cause the related
Prospectus to be supplemented by any Prospectus supplement
required by applicable law, and as so supplemented to be filed
pursuant to Rule 424 (or any similar provisions then in force)
promulgated under the Securities Act; and comply with the
provisions of the Securities Act and the Exchange Act
applicable to it with respect to the disposition of all
securities covered by such Registration Statement as so
amended or in such Prospectus as so supplemented and with
respect to the subsequent resale of any securities being sold
by a Participating Broker-Dealer covered by any such
Prospectus, in each case, in accordance with the intended
methods of distribution set forth in such Registration
Statement or Prospectus, as so amended.
(c) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in the Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is
required to be delivered under the Securities Act by any
Participating Broker-Dealer who seeks to sell Exchange Notes
during the Applicable Period relating thereto from whom the
Issuer has received written notice that such Broker-Dealer
will be a Participating Broker-Dealer in the applicable
Exchange Offer, notify the selling Holders of Registrable
Notes, or each such Participating Broker-Dealer, as the case
may be, their counsel and the managing underwriters, if any,
as promptly as possible, and, if requested by any such Person,
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
under the Securities Act (including in such notice a written
statement that any Holder may, upon request, obtain, at the
sole expense of the Issuer, one conformed copy of such
Registration Statement or post-effective amendment including
financial statements and schedules, documents incorporated or
deemed to be incorporated by reference and exhibits), (ii) of
the issuance by the Commission of any stop order suspending
the effectiveness of a 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
Registrable Notes or resales of Exchange Notes by
Participating Broker-Dealers the representations and
warranties of the Issuer contained in any agreement (including
any underwriting agreement) contemplated by Section 5(m)(i)
hereof cease to be true and correct in all material respects,
(iv) of the receipt by the Issuer of any notification with
respect to the suspension of the qualification or exemption
from qualification of a Registration Statement or any of the
Registrable Notes or the Exchange Notes 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 to the Issuer that makes any statement made in
such Registration Statement or related Prospectus or any
document incorporated or
11
deemed to be incorporated therein by reference untrue in any
material respect or that requires the making of any changes in
or amendments or supplements to such Registration Statement,
Prospectus or documents so that, in the case of the
Registration Statement, 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 Issuer's determination that a
post-effective amendment to a Registration Statement would be
appropriate.
(d) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in the Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is
required to be delivered under the Securities Act by any
Participating Broker-Dealer who seeks to sell Exchange Notes
during the Applicable Period, use its reasonable best efforts
to prevent the issuance of any order suspending the
effectiveness of a Registration Statement or of any order
preventing or suspending the use of a Prospectus or suspending
the qualification (or exemption from qualification) of any of
the Registrable Notes or the Exchange Notes, as the case may
be, for sale in any jurisdiction, and, if any such order is
issued, to use its reasonable best efforts to obtain the
withdrawal of any such order at the earliest practicable
moment.
(e) If (1) a Shelf Registration is filed pursuant to Section 3
hereof or (2) a Prospectus contained in the Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is
required to be delivered under the Securities Act by any
Participating Broker-Dealer who seeks to sell Exchange Notes
during the Applicable Period and if reasonably requested by
the managing underwriter or underwriters (if any), the Holders
of a majority in aggregate principal amount of the Registrable
Notes covered by such Registration Statement or any
Participating Broker-Dealer, as the case may be, (i) promptly
incorporate in such Registration Statement or Prospectus a
prospectus supplement or post-effective amendment such
information as the managing underwriter or underwriters (if
any), such Holders or any Participating Broker-Dealer, as the
case may be (based upon advice of counsel), determine is
reasonably necessary to be included therein and (ii) make all
required filings of such prospectus supplement or such
post-effective amendment as soon as practicable after the
Issuer has received notification of the matters to be
incorporated in such prospectus supplement or post-effective
amendment; PROVIDED, HOWEVER, that the Issuer shall not be
required to take any action hereunder that would, in the
written opinion of counsel to the Issuer, violate applicable
laws.
(f) If (1) a Shelf Registration is filed pursuant to Section 3
hereof or (2) a Prospectus contained in the Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is
required to be delivered under the Securities Act by any
Participating Broker-Dealer who seeks to sell Exchange Notes
during the Applicable Period,
12
furnish to each selling Holder of Registrable Notes or each
such Participating Broker-Dealer, as the case may be, who so
requests, its counsel and each managing underwriter, if any,
at the sole expense of the Issuer, one conformed copy of the
Registration Statement or Registration Statements 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) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in the Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is
required to be delivered under the Securities Act by any
Participating Broker-Dealer who seeks to sell Exchange Notes
during the Applicable Period, deliver to each selling Holder
of Registrable Notes or each such Participating Broker-Dealer,
as the case may be, its respective counsel, and the
underwriters, if any, at the sole expense of the Issuer, as
many copies of the Prospectus or Prospectuses (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 5, the Issuer hereby
consents to the use of such Prospectus and each amendment or
supplement thereto by each of the selling Holders of
Registrable Notes or each such Participating Broker-Dealer, as
the case may be, and the underwriters or agents, if any, and
dealers (if any), in connection with the offering and sale of
the Registrable Notes covered by, or the sale by Participating
Broker-Dealers of the Exchange Notes pursuant to, such
Prospectus and any amendment or supplement thereto.
(h) Prior to any public offering of Registrable Notes or Exchange
Notes or any delivery of a Prospectus contained in the
Exchange Offer Registration Statement by any Participating
Broker-Dealer who seeks to sell Exchange Notes during the
Applicable Period, use its reasonable best efforts to register
or qualify, and to cooperate with the selling Holders of
Registrable Notes or each such Participating Broker-Dealer, as
the case may be, the managing underwriter or underwriters, if
any, and its respective counsel in connection with the
registration or qualification (or exemption from such
registration or qualification) of such Registrable Notes or
Exchange Notes, as the case may be, for offer and sale under
the securities or Blue Sky laws of such jurisdictions within
the United States as any selling Holder, Participating
Broker-Dealer, or the managing underwriter or underwriters
reasonably request; PROVIDED, HOWEVER, that where Exchange
Notes or Registrable Notes are offered other than through an
underwritten offering, the Issuer agrees to use its reasonable
best efforts to cause the Issuer's counsel to perform Blue Sky
investigations and file registrations and qualifications
required to be filed pursuant to this Section 5(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 such Exchange Notes or
Registrable Notes covered by the applicable Registration
Statement; PROVIDED, HOWEVER, that the Issuer shall not be
required to (A) qualify generally to do
13
business in any jurisdiction where it is not then so
qualified, (B) take any action that would subject it to
general service of process in any such jurisdiction where it
is not then so subject or (C) subject itself to taxation in
excess of a nominal dollar amount in any such jurisdiction
where it is not then so subject.
(i) If a Shelf Registration is filed pursuant to Section 3 hereof,
cooperate with the selling Holders of Registrable Notes and
the managing underwriter or underwriters, if any, to
facilitate the timely preparation and delivery of certificates
representing Registrable Notes to be sold, which certificates
shall not bear any restrictive legends and shall be in a form
eligible for deposit with The Depository Trust Company and
enable such Registrable Notes to be in such denominations and
registered in such names as the managing underwriter or
underwriters, if any, or selling Holders may request at least
five Business Days prior to any sale of such Registrable Notes
or Exchange Notes.
(j) Use its reasonable best efforts to cause the Registrable Notes
or Exchange Notes covered by any Registration Statement to be
registered with or approved by such other governmental
agencies or authorities as may be reasonably necessary to
enable the seller or sellers thereof or the underwriter or
underwriters, if any, to consummate the disposition of such
Registrable Notes or Exchange Notes, except as may be required
solely as a consequence of the nature of such selling Holder's
business, in which case the Issuer will cooperate in all
reasonable respects with the filing of such Registration
Statement and the granting of such approvals.
(k) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in the Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is
required to be delivered under the Securities Act by any
Participating Broker-Dealer who seeks to sell Exchange Notes
during the Applicable Period, upon the occurrence of any event
contemplated by Section 5(c)(v) or 5(c)(vi) hereof, as
promptly as practicable prepare and (subject to Section 5(a)
and the penultimate paragraph of this Section 5) file with the
Commission, at the sole expense of the Issuer, a supplement or
post-effective amendment to the Registration Statement or a
supplement to the related Prospectus or any document
incorporated or deemed to be incorporated therein by
reference, or file any other required document so that, as
thereafter delivered to the purchasers of the Registrable
Notes being sold thereunder or to the purchasers of the
Exchange Notes to whom such Prospectus will be delivered by a
Participating Broker-Dealer, any such Prospectus will not
contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(l) Prior to the effective date of the first Registration
Statement relating to the Registrable Notes, (i) provide the
Trustee with certificates for the Registrable Notes in a form
eligible for deposit with The Depository Trust Company and
(ii) provide a CUSIP number for the Registrable Notes.
14
(m) In connection with any underwritten offering of Registrable
Notes pursuant to a Shelf Registration, enter into an
underwriting agreement as is customary in underwritten
offerings of debt securities similar to the Notes and take all
such other actions as are reasonably requested by the managing
underwriter or underwriters in order to expedite or facilitate
the registration or the disposition of such Registrable Notes
and, in such connection, (i) make such representations and
warranties to, and covenants with, the underwriters with
respect to the business of the Issuer and its subsidiaries, as
then conducted (including any acquired business, properties or
entity, if applicable), and the Registration Statement,
Prospectus and documents, if any, incorporated or deemed to be
incorporated by reference therein, in each case, as are
customarily made by issuers to underwriters in underwritten
offerings of debt securities similar to the Notes, and confirm
the same in writing if and when requested; (ii) use its
reasonable best efforts to obtain the written opinions of
counsel to the Issuer and written updates thereof in form,
scope and substance reasonably satisfactory to the managing
underwriter or 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 the managing underwriter or
underwriters; (iii) use its reasonable best efforts to obtain
"cold comfort" letters and updates thereof in form, scope and
substance reasonably satisfactory to the managing underwriter
or underwriters from the independent certified public
accountants of the Issuer (and, if necessary, any other
independent certified public accountants of any subsidiary of
the Issuer or of any business acquired by the Issuer for which
financial statements and financial data are, or are required
to be, included or incorporated by reference 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;
and (iv) if an underwriting agreement is entered into, the
same shall contain indemnification provisions and procedures
no less favorable than those set forth in Section 7 hereof (or
such other provisions and procedures acceptable to Holders of
a majority in aggregate principal amount of Registrable Notes
covered by such Registration Statement and the managing
underwriter or underwriters or agents) with respect to all
parties to be indemnified pursuant to said Section; PROVIDED
that the Issuer shall not be required to provide
indemnification to any underwriter selected in accordance with
the provisions of Section 9 hereof with respect to information
relating to such underwriter furnished in writing to the
Issuer by or on behalf of such underwriter expressly for
inclusion in such Registration Statement. The above shall be
done at each closing under such underwriting agreement, or as
and to the extent required thereunder.
(n) If (1) a Shelf Registration is filed pursuant to Section 3
hereof or (2) a Prospectus contained in the Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is
required to be delivered under the Securities Act by any
Participating Broker-Dealer who seeks to sell Exchange Notes
during the Applicable Period, make available for inspection by
any selling Holder of such Registrable Notes being sold or
each such Participating Broker-Dealer, as the case may be, any
underwriter participating in any such disposition of
Registrable Notes, if any, and any
15
attorney, accountant or other agent retained by any such
selling Holder or each such Participating Broker-Dealer, as
the case may be, or underwriter (collectively, the
"INSPECTORS"), at the offices where normally kept, during
reasonable business hours, all financial and other records,
pertinent corporate documents and instruments of the Issuer
and its subsidiaries (collectively, the "RECORDS") as shall be
reasonably necessary to enable them to exercise any applicable
due diligence responsibilities, and cause the officers,
directors and employees of the Issuer and its subsidiaries to
supply all information reasonably requested by any such
Inspector in connection with such Registration Statement and
Prospectus. Each Inspector shall agree in writing that it will
keep the Records confidential and that it will not disclose,
or use in connection with any market transactions in violation
of any applicable securities laws, any Records that the Issuer
determines, in good faith, to be confidential and that it
notifies the Inspectors in writing are confidential unless (i)
the disclosure of such Records is necessary to avoid or
correct a misstatement or omission in such Registration
Statement or Prospectus, (ii) the release of such Records is
ordered pursuant to a subpoena or other order from a court of
competent jurisdiction, (iii) disclosure of such information
is necessary or advisable in the opinion of counsel for an
Inspector in connection with any action, claim, suit or
proceeding, directly or indirectly, involving or potentially
involving such Inspector and arising out of, based upon,
relating to, or involving this Agreement or the Purchase
Agreement, or any transactions contemplated hereby or thereby
or arising hereunder or thereunder, or (iv) the information in
such Records has been made generally available to the public;
PROVIDED, HOWEVER, that (i) each Inspector shall agree to use
reasonable best efforts to provide notice to the Issuer of the
potential disclosure of any information by such Inspector
pursuant to clause (i), (ii) or (iii) of this sentence to
permit the Issuer to obtain a protective order (or waive the
provisions of this paragraph (n)) and (ii) each such Inspector
shall take such actions as are reasonably necessary to protect
the confidentiality of such information (if practicable) to
the extent such action is otherwise not inconsistent with, an
impairment of or in derogation of the rights and interests of
the Holder or any Inspector.
(o) Provide an indenture trustee for the Registrable Notes or the
Exchange Notes, as the case may be, and cause the Indenture or
the trust indenture provided for in Section 2(a) hereof to be
qualified under the TIA not later than the effective date of
the Exchange Offer or the first Registration Statement
relating to the Registrable Notes; and in connection
therewith, cooperate with the trustee under any such indenture
and the Holders of the Registrable Notes or Exchange Notes, as
applicable, to effect such changes to such indenture as may be
required for such indenture to be so qualified in accordance
with the terms of the TIA; and execute, and use its reasonable
best efforts to cause such trustee to execute, all documents
as may be required to effect such changes, and all other forms
and documents required to be filed with the Commission to
enable such indenture to be so qualified in a timely manner.
16
(p) Comply with all applicable rules and regulations of the
Commission and make generally available to the Issuer's
security holders earnings statements satisfying the provisions
of Section 11(a) of the Securities Act and Rule 158 thereunder
(or any similar rule promulgated under the Securities Act) no
later than 45 days after the end of any 12-month period (or 90
days after the end of any 12-month period if such period is a
fiscal year) (i) commencing at the end of any fiscal quarter
in which Registrable Notes or Exchange 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 Issuer after the effective date of a
Registration Statement, which statements shall cover said
12-month periods consistent with the requirements of Rule 158.
(q) Upon the request of a Holder, upon consummation of the
Exchange Offer or a Private Exchange, use its reasonable best
efforts to obtain an opinion of counsel to the Issuer, in a
form customary for underwritten transactions, addressed to the
Trustee for the benefit of all Holders of Registrable Notes
participating in the Exchange Offer or the Private Exchange,
as the case may be, that the Exchange Notes or Private
Exchange Notes, as the case may be, and the related indenture
constitute legal, valid and binding obligations of the Issuer,
enforceable against the Issuer in accordance with its
respective terms, subject to customary exceptions and
qualifications.
(r) If the Exchange Offer or a Private Exchange is to be
consummated, upon delivery of the Registrable Notes by Holders
to the Issuer (or to such other Person as directed by the
Issuer) in exchange for the Exchange Notes or the Private
Exchange Notes, as the case may be, xxxx, or cause to be
marked, on such Registrable Notes that such Registrable Notes
are being cancelled in exchange for the Exchange Notes or the
Private Exchange Notes, as the case may be; PROVIDED that in
no event shall such Registrable Notes be marked as paid or
otherwise satisfied.
(s) Cooperate with each seller of Registrable Notes covered by any
Registration Statement and each underwriter, if any,
participating in the disposition of such Registrable Notes and
their respective counsel in connection with any filings
required to be made with the National Association of
Securities Dealers, Inc. (the "NASD").
(t) Use its reasonable best efforts to take all other steps
reasonably necessary or advisable to effect the registration
of the Exchange Notes and/or Registrable Notes covered by a
Registration Statement contemplated hereby.
The Issuer may require each seller of Registrable Notes or Exchange
Notes as to which any registration is being effected to furnish to the Issuer
such information regarding such seller and the distribution of such Registrable
Notes or Exchange Notes as the Issuer may, from time to time, reasonably
request. The Issuer may exclude from such registration the Registrable Notes of
any seller so long as such seller fails to furnish such information within a
reasonable time after
17
receiving such request and in the event of such an exclusion, the Issuer shall
have no further obligation under this Agreement (including, without limitation,
the obligations under Section 4) with respect to such seller or any subsequent
Holder of such Registrable Notes. Each seller as to which any Shelf Registration
is being effected agrees to furnish promptly to the Issuer all information
required to be disclosed in order to make any information previously furnished
to the Issuer by such seller not materially misleading.
If any such Registration Statement refers to any Holder by name or
otherwise as the holder of any securities of the Issuer, then such Holder shall
have the right to require (i) the insertion therein of language, in form and
substance reasonably satisfactory to such Holder, to the effect that the holding
by such Holder of such securities is not to be construed as a recommendation by
such Holder of the investment quality of the securities covered thereby and that
such holding does not imply that such Holder will assist in meeting any future
financial requirements of the Issuer, or (ii) in the event that such reference
to such Holder by name or otherwise is not required by the Securities Act or any
similar federal statute then in force, the deletion of the reference to such
Holder in any amendment or supplement to the applicable Registration Statement
filed or prepared subsequent to the time that such reference ceases to be
required.
Each Holder of Registrable Notes and each Participating Broker-Dealer
agrees by acquisition of such Registrable Notes or Exchange Notes that, upon
actual receipt of any notice from the Issuer (x) of the happening of any event
of the kind described in Section 5(c)(ii), 5(c)(iii), 5(c)(iv), or 5(c)(v)
hereof, or (y) that the Board of Directors of the Issuer (the "BOARD OF
DIRECTORS") has resolved that the Issuer has a BONA FIDE business purpose for
doing so, then the Issuer may delay the filing or the effectiveness of the
Exchange Offer Registration Statement or the Shelf Registration Statement (if
not then filed or effective, as applicable) and shall not be required to
maintain the effectiveness thereof or amend or supplement the Exchange Offer
Registration Statement or the Shelf Registration, in all cases, for a period (a
"DELAY PERIOD") expiring upon the earlier to occur of (i) in the case of the
immediately preceding clause (x), such Holder's or Participating Broker-Dealer's
receipt of the copies of the supplemented or amended Prospectus contemplated by
Section 5(k) hereof or until it is advised in writing (the "ADVICE") by the
Issuer that the use of the applicable Prospectus may be resumed, and has
received copies of any amendments or supplements thereto or (ii) in the case of
the immediately preceding clause (y), the date which is the earlier of (A) the
date on which such business purpose ceases to interfere with the Issuer's
obligations to file or maintain the effectiveness of any such Registration
Statement pursuant to this Agreement or (B) 60 days after the Issuer notifies
the Holders of such good faith determination. There shall not be more than 60
days of Delay Periods during any 12-month period. Each of the Effectiveness
Period and the Applicable Period, if applicable, shall be extended by the number
of days during any Delay Period. Any Delay Period will not alter the obligations
of the Issuer to pay Liquidated Damages under the circumstances set forth in
Section 4 hereof.
In the event of any Delay Period pursuant to clause (y) of the
preceding paragraph, notice shall be given as soon as practicable after the
Board of Directors makes such a determination of the need for a Delay Period and
shall state, to the extent practicable, an estimate of the duration of such
Delay Period and shall advise the recipient thereof of the agreement of such
Holder provided in the next succeeding sentence. Each Holder, by his acceptance
of any Registrable
18
Note, agrees that during any Delay Period, each Holder will discontinue
disposition of such Notes or Exchange Notes covered by such Registration
Statement or Prospectus or Exchange Notes to be sold by such Holder or
Participating Broker-Dealer, as the case may be.
Section 6. REGISTRATION EXPENSES.
All fees and expenses incident to the performance of or compliance with
this Agreement by the Issuer (other than any underwriting discounts or
commissions and transfer taxes) shall be borne by the Issuer, whether or not the
Exchange Offer Registration Statement or the Shelf Registration is filed or
becomes effective or the Exchange Offer is consummated, 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
Registrable Notes or Exchange Notes and determination of the eligibility of the
Registrable Notes or Exchange Notes for investment under the laws of such
jurisdictions (x) where the holders of Registrable Notes are located, in the
case of an Exchange Offer, or (y) as provided in Section 5(h) hereof, in the
case of a Shelf Registration or in the case of Exchange Notes to be sold by a
Participating Broker-Dealer during the Applicable Period)), (ii) printing
expenses, including, without limitation, expenses of printing certificates for
Registrable Notes or Exchange Notes in a form eligible for deposit with The
Depository Trust Company and of printing prospectuses if the printing of
prospectuses is requested by the managing underwriter or underwriters, if any,
or by the Holders of a majority in aggregate principal amount of the Registrable
Notes included in any Registration Statement or in respect of Exchange Notes to
be sold by any Participating Broker-Dealer during the Applicable Period, as the
case may be, (iii) messenger, telephone and delivery expenses, (iv) fees and
disbursements of counsel for the Issuer and reasonable fees and disbursements of
one special counsel for all of the sellers of Registrable Notes (which shall be
reasonably acceptable to the Issuer) (exclusive of any counsel retained pursuant
to Section 7 hereof), (v) fees and disbursements of all independent certified
public accountants referred to in Section 5(m)(iii) hereof (including, without
limitation, the expenses of any special audit and "cold comfort" letters
required by or incident to such performance), (vi) Securities Act liability
insurance, if the Issuer desires such insurance, (vii) fees and expenses of all
other Persons retained by the Issuer, (viii) internal expenses of the Issuer
(including, without limitation, all salaries and expenses of officers and
employees of the Issuer performing legal or accounting duties), (ix) the expense
of any annual audit, (x) the fees and expenses incurred in connection with the
listing of the securities to be registered on any securities exchange, and the
obtaining of a rating of the securities, in each case, if applicable, and (xi)
the expenses relating to printing, word processing and distributing all
Registration Statements, underwriting agreements, indentures and any other
documents necessary in order to comply with this Agreement. Notwithstanding the
foregoing or anything to the contrary, each Holder shall pay all underwriting
discounts and commissions of any underwriters with respect to any Registrable
Notes sold by or on behalf of it.
Section 7. INDEMNIFICATION.
(a) The Issuer agrees to indemnify and hold harmless, to the
extent permitted by law, each Holder of Registrable Notes and
each Participating Broker-Dealer selling
19
Exchange Notes during the Applicable Period, each Person, if
any, who controls any such Person within the meaning of
Section 15 of the Securities Act or Section 20(a) of the
Exchange Act, the agents, employees, officers and directors of
each Holder and each such Participating Broker-Dealer and the
agents, employees, officers and directors of any such
controlling Person (each, a "PARTICIPANT") from and against
any and all losses, liabilities, claims, damages and expenses
(including, but not limited to, reasonable attorneys' fees and
any and all reasonable out-of-pocket expenses actually
incurred in investigating, preparing or defending against any
litigation, commenced or threatened, or any claim whatsoever,
and any and all reasonable amounts paid in settlement of any
claim or litigation (in the manner set forth in clause (c)
below)) (collectively, "LOSSES") to which they or any of them
may become subject under the Securities Act, the Exchange Act
or otherwise insofar as such Losses (or actions in respect
thereof) arise out of or are based upon any untrue statement
or alleged untrue statement of a material fact contained in
any Registration Statement (or any amendment thereto) or
Prospectus (as amended or supplemented if the Issuer shall
have furnished any amendments or supplements thereto) or any
preliminary prospectus, or caused by, arising out of or based
upon any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to
make the statements therein, in the case of the Prospectus, in
the light of the circumstances under which they were made, not
misleading, PROVIDED that (i) the foregoing indemnity shall
not be available to any Participant insofar as such Losses are
caused by any untrue statement or omission or alleged untrue
statement or omission made in reliance upon and in conformity
with information relating to such Participant furnished to the
Issuer in writing by or on behalf of such Participant
expressly for use therein, and (ii) that the foregoing
indemnity with respect to any Prospectus shall not inure to
the benefit of any Participant from whom the Person asserting
such Losses purchased Registrable Notes if (x) it is
established in the related proceeding that such Participant
failed to send or give a copy of the Prospectus (as amended or
supplemented if such amendment or supplement was furnished to
such Participant prior to the written confirmation of such
sale) to such Person with or prior to the written confirmation
of such sale, if required by applicable law, and (y) the
untrue statement or omission or alleged untrue statement or
omission was completely corrected in the Prospectus (as
amended or supplemented if amended or supplemented as
aforesaid) and such Prospectus does not contain any other
untrue statement or omission or alleged untrue statement or
omission that was the subject matter of the related
proceeding. This indemnity agreement will be in addition to
any liability that the Issuer may otherwise have, including,
but not limited to, liability under this Agreement.
(b) Each Participant agrees, severally and not jointly, to
indemnify and hold harmless (in the same manner and to the
same extent set forth in subsection 7(a))the Issuer, each
Person, if any, who controls the Issuer within the meaning of
Section 15 of the Securities Act or Section 20(a) of the
Exchange Act, and each of its agents, employees, officers and
directors and the agents, employees, officers and directors of
any such controlling Person from and against any Losses to
which they or any of them may become subject under the
Securities Act, the Exchange
20
Act or otherwise insofar as such Losses (or actions in respect
thereof) arise out of or are based upon any untrue statement
or alleged untrue statement of a material fact contained in
any Registration Statement (or any amendment thereto) or
Prospectus (as amended or supplemented if the Issuer shall
have furnished any amendments or supplements thereto) or any
preliminary prospectus, or caused by, arising out of or based
upon any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to
make the statements therein, in the case of the Prospectus, in
the light of the circumstances under which they were made, not
misleading, in each case to the extent, but only to the
extent, that any such Loss arises out of or is based upon any
untrue statement or alleged untrue statement or omission or
alleged omission made in reliance upon and in conformity with
information relating to such Participant furnished in writing
to the Issuer by or on behalf of such Participant expressly
for use therein.
(c) Promptly after receipt by an indemnified party under
subsection 7(a) or 7(b) above of notice of the commencement of
any action, suit or proceeding (collectively, an "ACTION"),
such indemnified party shall, if a claim in respect thereof is
to be made against the indemnifying party under such
subsection, notify each party against whom indemnification is
to be sought in writing of the commencement of such action
(but the failure so to notify an indemnifying party shall not
relieve such indemnifying party from any liability that it may
have under this Section 7 except to the extent that it has
been prejudiced in any material respect by such failure). In
case any such action is brought against any indemnified party,
and it notifies an indemnifying party of the commencement of
such action, the indemnifying party will be entitled to
participate in such action, and to the extent it may elect by
written notice delivered to the indemnified party promptly
after receiving the aforesaid notice from such indemnified
party, to assume the defense of such action with counsel
satisfactory to such indemnified party. Notwithstanding the
foregoing, the indemnified party or parties shall have the
right to employ its or their own counsel in any such action,
but the reasonable fees and expenses of such counsel shall be
at the expense of such indemnified party or parties unless (i)
the employment of such counsel shall have been authorized in
writing by the indemnifying parties in connection with the
defense of such action, (ii) the indemnifying parties shall
not have employed counsel to take charge of the defense of
such action within a reasonable time after notice of
commencement of the action, or (iii) the named parties to such
action (including any impleaded parties) include such
indemnified party and the indemnifying party or parties (or
such indemnifying parties have assumed the defense of such
action), and such indemnified party or parties shall have
reasonably concluded, that counsel selected by the
indemnifying party has a conflict of interest in representing
both the indemnifying party and the indemnified party (in
which case the indemnifying parties shall not have the right
to direct the defense of such action on behalf of the
indemnified party or parties), in any of which events such
reasonable fees and expenses of counsel shall be borne by the
indemnifying parties. In no event shall the indemnifying party
be liable for the fees and expenses of more than one counsel
(together with appropriate local counsel) at any time for all
indemnified parties in connection with any one action or
separate
21
but substantially similar or related actions arising in the
same jurisdiction out of the same general allegations or
circumstances. Any such separate firm for the Participants
shall be designated in writing by Participants who sold a
majority in interest of Registrable Notes sold by all such
Participants and shall be reasonably acceptable to the Issuer
and any such separate firm for the Issuer, its affiliates,
officers, directors, representatives, employees and agents and
such control Person of the Issuer shall be designated in
writing by the Issuer and shall be reasonable acceptable to
the Holders. An indemnifying party shall not be liable for any
settlement of any claim or action effected without its written
consent, which consent may not be unreasonably withheld. No
indemnifying party shall, without the prior written consent of
the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified
party is or could have been a party and indemnity could have
been sought hereunder by such indemnified party, unless such
settlement includes an unconditional release of such
indemnified party from all liability on claims that are the
subject matter of such proceeding.
(d) In order to provide for contribution in circumstances in which
the indemnification provided for in this Section 7 is for any
reason held to be unavailable from the indemnifying party, or
is insufficient to hold harmless a party indemnified under
this Section 7, each indemnifying party shall contribute to
the amount paid or payable by such indemnified party as a
result of such aggregate Losses (i) in such proportion as is
appropriate to reflect the relative benefits received by each
indemnifying party, on the one hand, and each indemnified
party, on the other hand, from the sale of the Notes to the
Initial Purchaser or the resale of the Registrable Notes by
such Holder, as applicable, or (ii) if such allocation is not
permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred
to in clause (i) above but also the relative fault of each
indemnified party, on the one hand, and each indemnifying
party, on the other hand, in connection with the statements or
omissions that resulted in such Losses, as well as any other
relevant equitable considerations. The relative benefits
received by the Issuer, on the one hand, and each Participant,
on the other hand, shall be deemed to be in the same
proportion as (x) the total proceeds from the sale of the
Notes to the Initial Purchaser (net of discounts and
commissions but before deducting expenses) received by the
Issuer are to (y) the total net profit received by such
Participant in connection with the sale of the Registrable
Notes. The relative fault of the parties shall be determined
by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to
information supplied by the Issuer or such Participant and the
parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission
or alleged statement or omission.
(e) The parties agree that it would not be just and equitable if
contribution pursuant to this Section 7 were determined by pro
rata allocation or by any other method of allocation that does
not take into account the equitable considerations referred to
above. Notwithstanding the provisions of this Section 7, (i)
in no case shall any
22
Participant be required to contribute any amount in excess of
the amount by which the net profit received by such
Participant in connection with the sale of the Registrable
Notes exceeds the amount of any damages that such Participant
has otherwise been required to pay by reason of any untrue or
alleged untrue statement or omission or alleged omission and
(ii) 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. Any party entitled to
contribution will, promptly after receipt of notice of
commencement of any action against such party in respect of
which a claim for contribution may be made against another
party or parties under this Section 7, notify such party or
parties from whom contribution may be sought, but the omission
to so notify such party or parties shall not relieve the party
or parties from whom contribution may be sought from any
obligation it or they may have under this Section 7 or
otherwise, except to the extent that it has been prejudiced in
any material respect by such failure; PROVIDED, HOWEVER, that
no additional notice shall be required with respect to any
action for which notice has been given under this Section 7
for purposes of indemnification. Anything in this section to
the contrary notwithstanding, no party shall be liable for
contribution with respect to any action or claim settled
without its written consent, PROVIDED, HOWEVER, that such
written consent was not unreasonably withheld.
Section 8. RULES 144 AND 144A.
The Issuer covenants that it will file the reports required, if any, to
be filed by it under the Securities Act and the Exchange Act and the rules and
regulations adopted by the Commission thereunder in a timely manner in
accordance with the requirements of the Securities Act and the Exchange Act and,
if at any time the Issuer is not required to file such reports, it will, upon
the request of any Holder or beneficial owner of Registrable Notes, make
available such information necessary to permit sales pursuant to Rule 144A under
the Securities Act. The Issuer further covenants that for so long as any
Registrable Notes remain outstanding it will take such further action as any
Holder of Registrable Notes may reasonably request from time to time to enable
such Holder to sell Registrable Notes without registration under the Securities
Act within the limitation of the exemptions provided by (a) Rule 144(k) and Rule
144A under the Securities Act, as such Rules may be amended from time to time,
or (b) any similar rule or regulation hereafter adopted by the Commission.
Section 9. UNDERWRITTEN REGISTRATIONS.
If any of the Registrable Notes covered by any Shelf Registration are
to be sold in an underwritten offering, the investment banker or investment
bankers and manager or managers that will manage the offering will be selected
by the Holders of a majority in aggregate principal amount of such Registrable
Notes included in such offering and shall be reasonably acceptable to the
Issuer.
No Holder of Registrable Notes may participate in any underwritten
registration hereunder if such Holder does not (a) agree to sell such Holder's
Registrable Notes on the basis provided in any underwriting arrangements
approved by the Persons entitled hereunder to
23
approve such arrangements and (b) complete and execute all questionnaires,
powers of attorney, indemnities, underwriting agreements and other documents
required under the terms of such underwriting arrangements.
Section 10. MISCELLANEOUS.
(a) NO INCONSISTENT AGREEMENTS. The Issuer has not, as of the date
hereof, and shall not have, after the date of this Agreement,
entered into any agreement with respect to any of its
securities that is inconsistent with the rights granted to the
Holders of Registrable Notes in this Agreement or otherwise
conflicts with the provisions hereof. The rights granted to
the Holders hereunder do not conflict with and are not
inconsistent with, in any material respect, the rights granted
to the holders of any of the Issuer's other issued and
outstanding securities under any such agreements. The Issuer
has not entered and will not enter into any agreement with
respect to any of its securities which will grant to any
Person piggy-back registration rights with respect to any
Registration Statement.
(b) ADJUSTMENTS AFFECTING REGISTRABLE NOTES. The Issuer shall not,
directly or indirectly, take any action with respect to the
Registrable Notes as a class that would adversely affect the
ability of the Holders of Registrable Notes to include such
Registrable Notes in a registration undertaken pursuant to
this Agreement.
(c) AMENDMENTS AND WAIVERS. The provisions of this Agreement may
not be amended, modified or supplemented, and waivers or
consents to departures from the provisions hereof may not be
given except pursuant to a written agreement duly signed and
delivered by (I) the Issuer and (II)(A) the Holders of not
less than a majority in aggregate principal amount of the then
outstanding Registrable Notes and (B) in circumstances that
would adversely affect the Participating Broker-Dealers, the
Participating Broker-Dealers holding not less than a majority
in aggregate principal amount of the Exchange Notes held by
all Participating Broker-Dealers; PROVIDED, HOWEVER, that
Section 7 and this Section 10(c) may not be amended, modified
or supplemented except pursuant to a written agreement duly
signed and delivered by the Issuer and each Holder and each
Participating Broker-Dealer (including any Person who was a
Holder or Participating Broker-Dealer of Registrable Notes or
Exchange Notes, as the case may be, disposed of pursuant to
any Registration Statement) affected by any such amendment,
modification, supplement or waiver. Notwithstanding the
foregoing, a waiver or consent to depart from the provisions
hereof with respect to a matter that relates exclusively to
the rights of Holders of Registrable Notes whose securities
are being sold pursuant to a Registration Statement and that
does not directly or indirectly affect, impair, limit or
compromise the rights of other Holders of Registrable Notes
may be given by Holders of at least a majority in aggregate
principal amount of the Registrable Notes being sold pursuant
to such Registration Statement.
(d) NOTICES. All notices and other communications (including,
without limitation, any notices or other communications to the
Trustee) provided for or permitted
24
hereunder shall be made in writing by hand-delivery,
registered first-class mail, next-day air courier or
telecopier:
(i) if to a Holder of the Registrable Notes or any
Participating Broker-Dealer, at the most current
address of such Holder or Participating
Broker-Dealer, as the case may be, set forth on the
records of the registrar under the Indenture.
(ii) if to the Issuer, at the address as follows:
National Coal Corp.
0000 Xxxxxx Xxxxxxxx Xxxx
Xxxxxxxxx, XX 00000
Telephone: (000) 000-0000
Fax: (000) 000-0000
Attention: General Counsel
(iii) if to the Initial Purchaser, at the address as
follows:
Xxxxxxxxx & Company, Inc.
Xxxxxxx Xxxxxx
0xx Xxxxx
Xxx Xxxx, XX 00000
Telephone: (000) 000-0000
Fax: (000) 000-0000
Attention: Legal and Compliance Department
All such notices and communications shall be deemed to have been duly
given: when delivered by hand, if personally delivered; five Business Days after
being deposited in the mail, postage prepaid, if mailed; when receipt is
acknowledged by the recipient's telecopier machine, if telecopied; and on the
next Business Day, if timely delivered to an air courier guaranteeing overnight
delivery.
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address and in the manner specified in such Indenture.
(e) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of
each of the parties hereto, the Holders and the Participating
Broker-Dealers; PROVIDED, HOWEVER, that this Agreement shall
not inure to the benefit of or be binding upon a successor or
assign of a Holder unless and to the extent such successor or
assign holds Registrable Notes.
(f) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate
counterparts, each of which when so executed shall be deemed
to be an original and all of which taken together shall
constitute one and the same agreement.
25
(g) HEADINGS. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the
meaning hereof.
(h) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WHOLLY WITHIN
THE STATE OF NEW YORK.
(i) SEVERABILITY. If any term, provision, covenant or restriction
of this Agreement is held by a court of competent jurisdiction
to be invalid, illegal, void or unenforceable, the remainder
of the terms, provisions, covenants and restrictions set forth
herein shall remain in full force and effect and shall in no
way be affected, impaired or invalidated, and the parties
hereto shall use their best efforts to find and employ an
alternative means to achieve the same or substantially the
same result as that contemplated by such term, provision,
covenant or restriction. It is hereby stipulated and declared
to be the intention of the parties that they would have
executed the remaining terms, provisions, covenants and
restrictions without including any of such that may be
hereafter declared invalid, illegal, void or unenforceable.
(j) SECURITIES HELD BY THE ISSUER OR ITS AFFILIATES. Whenever the
consent or approval of Holders of a specified percentage of
Registrable Notes is required hereunder, Registrable Notes
held by the Issuer or any of its affiliates (as such term is
defined in Rule 405 under the Securities Act) shall not be
counted in determining whether such consent or approval was
given by the Holders of such required percentage.
(k) THIRD-PARTY BENEFICIARIES. Holders and beneficial owners of
Registrable Notes and Participating Broker-Dealers are
intended third-party beneficiaries of this Agreement, and this
Agreement may be enforced by such Persons. No other Person is
intended to be, or shall be construed as, a third-party
beneficiary of this Agreement.
(l) ATTORNEYS' FEES. As between the parties to this Agreement, in
any action or proceeding brought to enforce any provision of
this Agreement, or where any provision hereof is validly
asserted as a defense, the successful party shall be entitled
to recover reasonable attorneys' fees actually incurred in
addition to its costs and expenses and any other available
remedy.
(m) ENTIRE AGREEMENT. This Agreement, together with the Purchase
Agreement and the Indenture, is intended by the parties as a
final and exclusive statement of the agreement and
understanding of the parties hereto in respect of the subject
matter contained herein and therein and any and all prior oral
or written agreements, representations, or warranties,
contracts, understandings, correspondence, conversations and
memoranda between the Holders on the one hand and the Issuer
on the other, or between or among any agents, representatives,
parents, subsidiaries, affiliates, predecessors in interest or
successors in interest with respect to the subject matter
hereof and thereof are merged herein and replaced hereby.
26
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
NATIONAL COAL CORP., as Issuer
By: /s/ Xxx X. Xxx
---------------------------------
Name: Xxx X. Xxx
Title: CEO
NATIONAL COAL CORPORATION, as Guarantor
By: /s/ Xxx X. Xxx
---------------------------------
Name: Xxx X. Xxx
Title: CEO
NC TRANSPORTATION INC., as Guarantor
By: /s/ Xxx X. Xxx
---------------------------------
Name: Xxx X. Xxx
Title: CEO
NC RAILROAD, INC., as Guarantor
By: /s/ Xxxxxx Xxxxxx
---------------------------------
Name: Xxxxxx Xxxxxx
Title: President
XXXXXXXXX & COMPANY, INC., as Initial Purchaser
By: /s/ Xxxxx Xxxxxx
---------------------------------
Name: Xxxxx Xxxxxx
Title: Managing Director
27
