Exhibit 4.7
REGISTRATION RIGHTS AGREEMENT
Dated December 8, 1999
between
VIATEL, INC.
and
XXXXXX XXXXXXX & CO. INCORPORATED
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "AGREEMENT") is made
and entered into on December 8, 1999 between VIATEL, INC., a Delaware
corporation (the "COMPANY"), and XXXXXX XXXXXXX & CO. INCORPORATED (the
"PURCHASER").
This Agreement is made pursuant to the Purchase Agreement,
dated the date hereof, between the Company and the Purchaser (the "PURCHASE
AGREEMENT"), which provides for the sale by the Company to the Purchaser of an
aggregate of $63,666,000 principal amount of 11.50% Senior Dollar Notes Due 2009
of the Company (the "NEW NOTES").
This Agreement is also made in connection with the Company's
(i) offer to exchange (the "OFFER TO EXCHANGE") $686.03 principal amount of
additional 11.50% Senior Dollar Notes due 2009 of the Company (the "ADDITIONAL
NOTES") and total cash consideration of $71.24 (including a consent fee of
$20.00) for each $1,000 principal amount at maturity of outstanding 11% Senior
Discount Notes Due 2008 (the "DESTIA NOTES") of Destia Communications, Inc.
(formerly known as Econophone, Inc.), a Delaware corporation ("DESTIA"), and
(ii) solicitation of consents from the holders of the Destia Notes to certain
proposed amendments to the indenture pursuant to which the Destia Notes were
issued and waivers from such holders of the Destia Notes of their right to
participate in any repurchase offer for the Destia Notes, on the terms and
subject to the conditions set forth in the Offering Memorandum and Consent
Solicitation, dated November 4, 1999. The New Notes and the Additional Notes are
hereinafter, collectively, referred to as the "NOTES."
In order to induce the Purchaser to enter into the Purchase
Agreement and holders of the outstanding Destia Notes as of November 1, 1999
(the "DESTIA NOTEHOLDERS") to tender and not withdraw their tendered Destia
Notes, the Company has agreed to provide to the Purchaser, such Destia
Noteholders who have properly tendered their Destia Notes pursuant to the Offer
to Exchange, and their direct and indirect transferees the registration rights
set forth in this Agreement. The execution of this Agreement is a condition to
the closing under the Purchase Agreement.
In consideration of the foregoing, the parties hereto agree as
follows:
1. DEFINITIONS.
As used in this Agreement, the following capitalized defined
terms shall have the following meanings:
"CLOSING DATE" shall mean the Closing Date as defined in the
Purchase Agreement.
"COMPANY" shall have the meaning set forth in the Preamble to
this Agreement and shall also include the Company's successors.
"DESTIA NOTEHOLDERS" shall have the meaning set forth in the
Preamble to this Agreement.
"DESTIA NOTES" shall have the meaning set forth in the
Preamble to this Agreement.
"EXCHANGE DATES" shall have the meaning set forth in Section
2(a)(ii) hereof.
"EXCHANGE NOTES" shall mean notes issued in the Exchange Offer
pursuant to Section 2(a) hereof.
"EXCHANGE OFFER" shall mean the exchange offer by the Company
of Exchange Notes for Registrable Notes pursuant to Section 2(a)
hereof.
"EXCHANGE OFFER REGISTRATION" shall mean a registration under
the 1933 Act effected pursuant to Section 2(a) hereof.
"EXCHANGE OFFER REGISTRATION STATEMENT" shall mean an exchange
offer registration statement on Form S-4 (or, if applicable, on another
appropriate form) and all amendments and supplements to such
registration statement, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by
reference therein.
"HOLDER" shall mean registered owners of Registrable Notes
under the Indenture; PROVIDED THAT for purposes of Sections 4 and 5 of
this Agreement, the term "Holder" shall include Participating
Broker-Dealers (as defined in Section 4(a) hereof).
"INDENTURE" shall mean the indenture, dated December 8, 1999,
between the Company and The Bank of New York, as trustee, as the same
may be amended from time to time in accordance with the terms thereof.
"MAJORITY HOLDERS" shall mean the Holders of a majority of the
aggregate principal amount of outstanding Registrable Notes; PROVIDED
THAT whenever the consent or approval of Holders of a specified
percentage of Registrable Notes is required hereunder, Registrable
Notes held by the Company or any of its affiliates (as such term is
defined in Rule 405 under the 0000 Xxx) (other than the Purchaser or
subsequent holders of Registrable Notes if such subsequent holders are
deemed to be such affiliates solely by reason of their holding of such
Registrable Notes) shall not be counted in determining whether such
consent or approval was given by the Holders of such required
percentage or amount.
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"1934 ACT" shall mean the Securities Exchange Act of 1934, as
amended from time to time.
"1933 ACT" shall mean the Securities Act of 1933, as amended
from time to time.
"NOTES" shall have the meaning set forth in the Preamble to
this Agreement.
"OFFER TO EXCHANGE" shall have the meaning set forth in the
Preamble to this Agreement.
"PERSON" shall mean an individual, partnership, corporation,
limited liability company, joint venture, association, joint stock
company, trust or unincorporated organization or other entity, or a
government or agency or political subdivision thereof.
"PROSPECTUS" shall mean the prospectus included in a
Registration Statement, including any preliminary prospectus, and any
such prospectus as amended or supplemented by any prospectus
supplement, including a prospectus supplement with respect to the terms
of the offering of any portion of the Registrable Notes covered by a
Shelf Registration Statement, and by all other amendments and
supplements to such prospectus, and in each case including all material
incorporated by reference therein.
"PURCHASE AGREEMENT" shall have the meaning set forth in the
Preamble to this Agreement.
"PURCHASER" shall have the meaning set forth in the Preamble
to this Agreement.
"REGISTRABLE NOTES" shall mean the Notes; PROVIDED, HOWEVER,
that any particular Note shall cease to be a Registrable Note when the
earliest of the following events occurs (i) a Registration Statement
with respect to such Note shall have been declared effective under the
1933 Act and such Note shall have been disposed of pursuant to such
Registration Statement, (ii) such Note has been sold to the public
pursuant to Rule 144 (or any similar rule then in force, but not Rule
144A) under the 1933 Act or (iii) such Note shall have ceased to be
outstanding.
"REGISTRATION EXPENSES" shall mean any and all expenses
incident to performance of or compliance by the Company with this
Agreement, including without limitation: (i) all SEC, stock exchange or
National Association of Securities Dealers, Inc. registration and
filing fees, (ii) all fees and expenses incurred in connection with
compliance with state securities or blue sky laws (including reasonable
fees and disbursements of counsel for any underwriters or Holders in
connection with blue sky qualification of any of the Exchange Notes or
Registrable Notes), (iii) all expenses of any
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Persons in preparing or assisting in preparing, word processing,
printing and distributing any Registration Statement, any Prospectus,
any amendments or supplements thereto, any underwriting agreements,
securities sales agreements and other documents relating to the
performance of and compliance with this Agreement, (iv) all rating
agency fees, (v) all fees and disbursements relating to the
qualification of the Indenture under applicable securities laws, (vi)
the fees and disbursements of the Trustee and its counsel, (vii) the
fees and disbursements of counsel for the Company and, in the case of a
Shelf Registration Statement, the reasonable fees and disbursements of
one counsel for the Holders (which counsel shall be selected by the
Majority Holders and which counsel may also be counsel for the
Purchaser) and (viii) the fees and disbursements of the independent
public accountants of the Company, including the expenses of any
special audits or "cold comfort" letters required by or incident to
such performance and compliance, but excluding fees and expenses of
counsel to the underwriters (other than reasonable fees and expenses
set forth in clause (ii) above) or the Holders and underwriting
discounts and commissions and transfer taxes, if any, relating to the
sale or disposition of Registrable Notes by a Holder.
"REGISTRATION STATEMENT" shall mean any registration statement
of the Company that covers any of the Exchange Notes or Registrable
Notes pursuant to the provisions of this Agreement and all amendments
and supplements to any such Registration Statement, including
post-effective amendments, in each case including the Prospectus
contained therein, all exhibits thereto and all material incorporated
by reference therein.
"SEC" shall mean the Securities and Exchange Commission.
"SHELF REGISTRATION" shall mean a registration effected
pursuant to Section 2(b) hereof.
"SHELF REGISTRATION STATEMENT" shall mean a "shelf"
registration statement of the Company pursuant to the provisions of
Section 2(b) of this Agreement which covers all of the Registrable
Notes (but no other securities unless approved by the Majority Holders)
on an appropriate form under Rule 415 under the 1933 Act, or any
similar rule that may be adopted by the SEC which will accomplish a
similar objective, and all amendments and supplements to such
registration statement, including post-effective amendments, in each
case including the Prospectus contained therein, all exhibits thereto
and all material incorporated by reference therein.
"TRUSTEE" shall mean the trustee with respect to the Notes
under the Indenture.
"UNDERWRITTEN REGISTRATION" or "UNDERWRITTEN OFFERING" shall
mean a registration in which Registrable Notes are sold to an
Underwriter (as hereinafter defined) for reoffering to the public.
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2. REGISTRATION UNDER THE 1933 ACT.
(a) To the extent not prohibited by any applicable law or
applicable interpretation of the staff of the SEC, the Company shall use its
best efforts to cause to be filed an Exchange Offer Registration Statement
covering the offer by the Company to the Holders to exchange all of the
Registrable Notes for Exchange Notes and to have such Registration Statement
remain effective until the closing of the Exchange Offer. The Company shall
commence the Exchange Offer promptly after the Exchange Offer Registration
Statement has been declared effective by the SEC and use its best efforts to
have the Exchange Offer consummated not later than 60 days after such effective
date. The Company shall commence the Exchange Offer by mailing the related
exchange offer Prospectus and accompanying documents to each Holder stating, in
addition to such other disclosures as are required by applicable law:
(i) that the Exchange Offer is being made pursuant to this
Registration Rights Agreement and that all Registrable Notes validly
tendered will be accepted for exchange;
(ii) the dates of acceptance for exchange (which shall be a
period of at least 20 business days from the date such notice is
mailed) (the "EXCHANGE DATES");
(iii) that any Registrable Note not tendered will remain
outstanding and continue to accrue interest, but will not retain any
rights under this Registration Rights Agreement;
(iv) that Holders electing to have a Registrable Note
exchanged pursuant to the Exchange Offer will be required to surrender
such Registrable Note, together with the enclosed letters of
transmittal, to the institution and at the address (located in the
Borough of Manhattan, The City of New York) specified in the notice
prior to the close of business on the last Exchange Date; and
(v) that Holders will be entitled to withdraw their election,
not later than the close of business on the last Exchange Date, by
sending to the institution and at the address (located in the Borough
of Manhattan, The City of New York) specified in the notice a telegram,
telex, facsimile transmission or letter setting forth the name of such
Holder, the principal amount of Registrable Notes delivered for
exchange and a statement that such Holder is withdrawing his or her
election to have such Registrable Notes exchanged.
As soon as practicable after the last Exchange Date, the
Company shall:
(i) accept for exchange Registrable Notes or portions thereof
tendered and not validly withdrawn pursuant to the Exchange Offer; and
(ii) deliver, or cause to be delivered, to the Trustee for
cancellation all Registrable Notes or portions thereof so accepted for
exchange by the Company
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and issue, and cause the Trustee to promptly authenticate and mail to
each Holder, an Exchange Note equal in principal amount and of like
terms to the Registrable Notes surrendered by such Holder.
The Company shall use its best efforts to complete the Exchange Offer as
provided above and shall comply with the applicable requirements of the 1933
Act, the 1934 Act and other applicable laws and regulations in connection with
the Exchange Offer. The Exchange Offer shall not be subject to any conditions,
other than that the Exchange Offer does not violate applicable law or any
applicable interpretation of the staff of the SEC. The Company shall inform the
Purchaser of the names and addresses of the Holders to whom the Exchange Offer
is made, and the Purchaser shall have the right, subject to applicable law, to
contact such Holders and otherwise facilitate the tender of Registrable Notes in
the Exchange Offer.
(b) In the event that (i) the Company determines that the
Exchange Offer Registration provided for in Section 2(a) above is not available
or may not be consummated as soon as practicable after the last Exchange Date
because it would violate applicable law or the applicable interpretations of the
staff of the SEC, (ii) the Exchange Offer is not for any other reason
consummated by the date that is six months after the Closing Date or (iii) the
Exchange Offer has been completed and in the opinion of counsel for the
Purchaser or the Destia Noteholders a Registration Statement must be filed and a
Prospectus must be delivered by the Purchaser or the Destia Noteholder in
connection with any offering or sale of Registrable Notes by such Purchaser or
such Destia Noteholder, of Registrable Notes that were acquired by the Purchaser
or the Destia Noteholder from the Company, the Company shall use its best
efforts to cause to be filed as soon as practicable after such determination,
date or notice of such opinion of counsel is given to the Company, as the case
may be, a Shelf Registration Statement providing for the sale by the Holders of
all of the Registrable Notes and to have such Shelf Registration Statement
declared effective by the SEC. The Company agrees to use its best efforts to
keep the Shelf Registration Statement continuously effective until the
expiration of the period referred to in Rule 144(k) under the 1933 Act with
respect to all Registrable Notes covered by the Shelf Registration Statement, or
such shorter period that will terminate when all of the Registrable Notes
covered by the Shelf Registration Statement have been sold pursuant to the Shelf
Registration Statement or as would be permitted by the current rules and
regulations. The Company further agrees to supplement or amend the Shelf
Registration Statement if required by the rules, regulations or instructions
applicable to the registration form used by the Company for such Shelf
Registration Statement or by the 1933 Act or by any other applicable rules and
regulations thereunder for shelf registration or if reasonably requested by a
Holder with respect to information relating to such Holder, and to use its best
efforts to cause any such amendment to become effective and such Shelf
Registration Statement to become usable as soon as thereafter practicable. The
Company agrees to furnish to the Holders of Registrable Notes copies of any such
supplement or amendment promptly after its being used or filed with the SEC.
(c) The Company shall pay all Registration Expenses in
connection with the registration pursuant to Section 2(a) or Section 2(b). Each
Holder shall pay all underwriting
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discounts and commissions and transfer taxes, if any, relating to the sale or
disposition of such Holder's Registrable Notes pursuant to the Shelf
Registration Statement.
(d) An Exchange Offer Registration Statement pursuant to
Section 2(a) hereof or a Shelf Registration Statement pursuant to Section 2(b)
hereof will not be deemed to have become effective unless it has been declared
effective by the SEC unless such action by the SEC is no longer required;
PROVIDED, HOWEVER, that, if, after it has been declared effective, the offering
of Registrable Notes pursuant to a Shelf Registration Statement is interfered
with by any stop order, injunction or other order or requirement of the SEC or
any other governmental agency or court, such Registration Statement will be
deemed not to have become effective during the period of such interference until
the offering of Registrable Notes pursuant to such Registration Statement may
legally resume. In the event that the Exchange Offer is not consummated and, if
a Shelf Registration Statement is required hereby, the Shelf Registration
Statement is not declared or permitted to go effective on or prior to the date
that is six months after the Closing Date, the annual interest rate borne by the
Notes will increase by 0.5% per annum, until the date the Exchange Offer is
consummated or a Shelf Registration Statement is declared effective.
(e) Without limiting the remedies available to the Purchaser,
the Destia Noteholders and the Holders, the Company acknowledges that any
failure by the Company to comply with its obligations under Section 2(a) and
Section 2(b) hereof may result in material irreparable injury to the Purchaser,
the Destia Noteholders or the Holders for which there is no adequate remedy at
law, that it will not be possible to measure damages for such injuries precisely
and that, in the event of any such failure, the Purchaser, the Destia
Noteholders or any Holder may obtain such relief as may be required to
specifically enforce the Company's obligations under Section 2(a) and Section
2(b) hereof.
3. REGISTRATION PROCEDURES.
In connection with the obligations of the Company with respect
to the Registration Statements pursuant to Section 2(a) and Section 2(b) hereof,
the Company shall as expeditiously as possible:
(a) prepare and file with the SEC a Registration Statement on
the appropriate form under the 1933 Act, which form (x) shall be
selected by the Company and (y) shall, in the case of a Shelf
Registration, be available for the sale of the Registrable Notes by the
selling Holders thereof and (z) shall comply as to form in all material
respects with the requirements of the applicable form and include all
financial statements required by the SEC to be filed therewith, and use
its best efforts to cause such Registration Statement to become
effective and remain effective in accordance with Section 2 hereof;
(b) prepare and file with the SEC such amendments and
post-effective amendments to each Registration Statement as may be
necessary to keep such Registration Statement effective for the
applicable period and cause each Prospectus to be
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supplemented by any required prospectus supplement and, as so
supplemented, to be filed pursuant to Rule 424 under the 1933 Act; to
keep each Prospectus current during the period described under Section
4(3) and Rule 174 under the 1933 Act that is applicable to transactions
by brokers or dealers with respect to the Registrable Notes or Exchange
Notes;
(c) in the case of a Shelf Registration, furnish to each
Holder of Registrable Notes, to counsel for the Purchaser, to counsel
for the Holders and to each Underwriter of an Underwritten Offering of
Registrable Notes, if any, without charge, as many copies of each
Prospectus, including each preliminary Prospectus, and any amendment or
supplement thereto and such other documents as such Holder or
Underwriter may reasonably request, in order to facilitate the public
sale or other disposition of the Registrable Notes; and the Company
consents to the use of such Prospectus and any amendment or supplement
thereto in accordance with applicable law by each of the selling
Holders of Registrable Notes and any such Underwriters in connection
with the offering and sale of the Registrable Notes covered by and in
the manner described in such Prospectus or any amendment or supplement
thereto in accordance with applicable law;
(d) use its reasonable best efforts to register or qualify the
Registrable Notes under all applicable state securities or "blue sky"
laws of such jurisdictions as any Holder of Registrable Notes covered
by a Registration Statement shall reasonably request in writing by the
time the applicable Registration Statement is declared effective by the
SEC, to cooperate with such Holders in connection with any filings
required to be made with the National Association of Securities
Dealers, Inc. and do any and all other acts and things which may be
reasonably necessary or advisable to enable such Holder to consummate
the disposition in each such jurisdiction of such Registrable Notes
owned by such Holder; PROVIDED, HOWEVER, that the Company shall not be
required to (i) qualify as a foreign corporation or as a dealer in
securities in any jurisdiction where it would not otherwise be required
to qualify but for this Section 3(d), (ii) file any general consent to
service of process or (iii) subject itself to taxation in any such
jurisdiction if it is not so subject;
(e) in the case of a Shelf Registration, notify each Holder of
Registrable Notes, counsel for the Holders and counsel for the
Purchaser promptly and, if requested by any such Holder or counsel,
confirm such advice in writing (i) when a Registration Statement has
become effective and when any post-effective amendment thereto has been
filed and becomes effective, (ii) of any request by the SEC or any
state securities authority for amendments and supplements to a
Registration Statement and Prospectus or for additional information
after the Registration Statement has become effective, (iii) of the
issuance by the SEC or any state securities authority of any stop order
suspending the effectiveness of a Registration Statement or the
initiation of any proceedings for that purpose, (iv) if, between the
effective date of a Registration Statement and the closing of any sale
of Registrable Notes covered thereby, the representations and
warranties of the
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Company contained in any underwriting agreement, securities sales
agreement or other similar agreement, if any, relating to the offering
cease to be true and correct in all material respects or if the Company
receives any notification with respect to the suspension of the
qualification of the Registrable Notes for sale in any jurisdiction or
the initiation of any proceeding for such purpose, (v) of the happening
of any event during the period a Shelf Registration Statement is
effective which makes any statement made in such Registration Statement
or the related Prospectus untrue in any material respect or which
requires the making of any changes in such Registration Statement or
Prospectus in order to make the statements therein not misleading in
any material respect and (vi) of any determination by the Company that
a post-effective amendment to a Registration Statement would be
appropriate;
(f) make every reasonable effort to obtain the withdrawal of
any order suspending the effectiveness of a Registration Statement at
the earliest possible moment and provide prompt notice to each Holder
of the withdrawal of any such order;
(g) in the case of a Shelf Registration, furnish to each
Holder of Registrable Notes, without charge, at least one conformed
copy of each Registration Statement and any post-effective amendment
thereto (without documents incorporated therein by reference or
exhibits thereto, unless requested);
(h) in the case of a Shelf Registration, cooperate with the
selling Holders of Registrable Notes to facilitate the timely
preparation and delivery of certificates representing Registrable Notes
to be sold and not bearing any restrictive legends and enable such
Registrable Notes to be in such denominations (consistent with the
provisions of the Indenture) and registered in such names as the
selling Holders may reasonably request at least two business days prior
to the closing of any sale of Registrable Notes;
(i) in the case of a Shelf Registration, upon the occurrence
of any event contemplated by Section 3(e)(v) hereof, use its best
efforts to prepare and file with the SEC a supplement or post-effective
amendment to a Registration Statement or the related Prospectus or any
document incorporated therein by reference or file any other required
document so that, as thereafter delivered to the purchasers of the
Registrable Notes, such Prospectus will not contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading. The Company agrees to notify the
Holders to suspend use of the Prospectus as promptly as practicable
after the occurrence of such an event, and the Holders hereby agree to
suspend use of the Prospectus until the Company has amended or
supplemented the Prospectus to correct such misstatement or omission;
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(j) a reasonable time prior to the filing of any Registration
Statement, any Prospectus, any amendment to a Registration Statement or
amendment or supplement to a Prospectus or any document that is to be
incorporated by reference into a Registration Statement or a Prospectus
after initial filing of a Registration Statement, provide copies of
such document to the Purchaser and its counsel (and, in the case of a
Shelf Registration Statement, the Holders and their counsel) and make
such of the representatives of the Company as shall be reasonably
requested by the Purchaser or its counsel (and, in the case of a Shelf
Registration Statement, the Holders or their counsel) available for
discussion of such document, and shall not at any time file or make any
amendment to the Registration Statement, any Prospectus or any
amendment of or supplement to a Registration Statement or a Prospectus
or any document (other than a document which the Company is legally
required to file under the Exchange Act) which is to be incorporated by
reference into a Registration Statement or a Prospectus, of which the
Purchaser and its counsel (and, in the case of a Shelf Registration
Statement, the Holders and their counsel) shall not have previously
been advised and furnished a copy or to which the Purchaser or its
counsel (and, in the case of a Shelf Registration Statement, the
Holders or their counsel) shall reasonably object;
(k) obtain a CUSIP number for all Exchange Notes or
Registrable Notes, as the case may be, not later than the effective
date of a Registration Statement;
(l) cause the Indenture to be qualified under the Trust
Indenture Act of 1939, as amended (the "TIA"), in connection with the
registration of the Exchange Notes or Registrable Notes, as the case
may be, cooperate with the Trustee and the Holders to effect such
changes to the Indenture as may be required for the Indenture to be so
qualified in accordance with the terms of the TIA and execute, and use
its reasonable best efforts to cause the Trustee to execute, all
documents as may be required to effect such changes and all other forms
and documents required to be filed with the SEC to enable the Indenture
to be so qualified in a timely manner;
(m) in the case of a Shelf Registration, upon execution of
customary confidentiality agreements reasonably satisfactory to the
Company and its counsel, make available for inspection by a
representative of the Holders of the Registrable Notes, any Underwriter
participating in any disposition pursuant to such Shelf Registration
Statement, and attorneys and accountants designated by the Holders, at
reasonable times and in a reasonable manner, all financial and other
records, pertinent documents and properties of the Company, and cause
the respective officers, directors and employees of the Company to
supply all information reasonably requested by any such representative,
Underwriter, attorney or accountant in connection with a Shelf
Registration Statement;
(n) in the case of a Shelf Registration, if reasonably
requested by any Holder of Registrable Notes covered by such
Registration Statement, (i) promptly incorporate in a Prospectus
supplement or post-effective amendment such information with respect to
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such Holder as is legally required to be included therein and (ii) make
all required filings of such Prospectus supplement or such
post-effective amendment as soon as the Company has received
notification of the matters to be incorporated in such filing; and
(o) in the case of a Shelf Registration, use its reasonable
best efforts to enter into such customary agreements and take all such
other actions in connection therewith (including those requested by the
Holders of a majority in principal amount of the Registrable Notes
being sold) in order to expedite or facilitate the disposition of such
Registrable Notes including, but not limited to, an Underwritten
Offering and in such connection, (i) to the extent possible, make such
representations and warranties to the Holders and any Underwriters of
such Registrable Notes with respect to the business of the Company and
its subsidiaries, the Shelf Registration Statement, Prospectus and
documents incorporated by reference therein or deemed incorporated by
reference therein, if any, in each case, in form, substance and scope
as are customarily made by issuers to underwriters in underwritten
offerings and confirm the same if and when requested, (ii) use its
reasonable best efforts to obtain opinions of counsel to the Company
(which counsel and opinions, in form, scope and substance, shall be
reasonably satisfactory to the Holders and such Underwriters and their
respective counsel) addressed to each selling Holder and Underwriter of
Registrable Notes, covering the matters customarily covered in opinions
requested in underwritten offerings, (iii) use its reasonable best
efforts to obtain "cold comfort" letters from the independent certified
public accountants of the Company (and, if necessary, any other
certified public accountant of any subsidiary of the Company, or of any
business acquired by the Company for which financial statements and
financial data are or are required to be included in the Shelf
Registration Statement) addressed to each selling Holder and
Underwriter of Registrable Notes, 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) deliver
such documents and certificates as may be reasonably requested by the
Holders of a majority in principal amount of the Registrable Notes
being sold or the Underwriters, and which are customarily delivered in
underwritten offerings, to evidence the continued validity of the
representations and warranties of the Company made pursuant to clause
(i) above and to evidence compliance with any customary conditions
contained in an underwriting agreement.
In the case of a Shelf Registration Statement, the Company may
require each Holder of Registrable Notes to furnish to the Company such
information regarding the Holder and the proposed distribution by such Holder of
such Registrable Notes as the Company may from time to time reasonably request
in writing. No Holder of Registrable Notes may include its Registrable Notes in
such Shelf Registration Statement unless and until such Holder furnishes such
information to the Company. Each Holder including Registrable Notes in a Shelf
Registration shall agree to furnish promptly to the Company any information
regarding such Holder and the proposed distribution by such Holder of such
Registrable Notes required to make any information previously furnished to the
Company by such Holder not materially misleading.
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In the case of a Shelf Registration Statement, each Holder
agrees that, upon receipt of any notice from the Company of the happening of any
event of the kind described in Section 3(e)(v) hereof, such Holder will
forthwith discontinue disposition of Registrable Notes pursuant to a Shelf
Registration Statement until such Holder's receipt of the copies of the
supplemented or amended Prospectus contemplated by Section 3(i) hereof, and, if
so directed by the Company, such Holder will deliver to the Company (at its
expense) all copies in its possession, other than permanent file copies then in
such Holder's possession, of the Prospectus covering such Registrable Notes
current at the time of receipt of such notice. If the Company shall give any
such notice to suspend the disposition of Registrable Notes pursuant to a Shelf
Registration Statement, the Company shall extend the period during which the
Registration Statement shall be maintained effective pursuant to this Agreement
by the number of days during the period from and including the date of the
giving of such notice to and including the date when the Holders shall have
received copies of the supplemented or amended Prospectus necessary to resume
such dispositions. There may not be more than two such suspensions during any
365 day period and any such suspensions may not exceed 30 days for each
suspension.
The Holders of Registrable Notes covered by a Shelf
Registration Statement who desire to do so may sell such Registrable Notes in an
Underwritten Offering; PROVIDED THAT the Company shall be required to use its
reasonable best efforts to effect an underwritten offering only upon the request
of Holders of at least 25% in aggregate principal amount of the Registrable
Notes outstanding at the time such request is delivered to the Company. In any
such Underwritten Offering, the investment banker or investment bankers and
manager or managers (the "UNDERWRITERS") that will administer the offering will
be selected by the Majority Holders of the Registrable Notes included in such
offering, subject to approval by the Company, which approval will not be
unreasonably withheld.
4. PARTICIPATION OF BROKER-DEALERS IN EXCHANGE OFFER.
(a) The staff of the SEC has taken the position that any
broker-dealer that receives Exchange Notes for its own account in the Exchange
Offer in exchange for Notes that were acquired by such broker-dealer as a result
of market-making or other trading activities (a "PARTICIPATING BROKER-DEALER")
may be deemed to be an "underwriter" within the meaning of
the 1933 Act and must deliver a prospectus meeting the requirements of the 1933
Act in connection with any resale of such Exchange Notes.
The Company understands that it is the position of the staff
of the SEC 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 obligation
under the 1933 Act in connection with resales of Exchange Notes for their own
accounts, so long as the Prospectus otherwise meets the requirements of the 1933
Act.
12
(b) In light of the above, notwithstanding the other
provisions of this Agreement, the Company agrees that the provisions of this
Agreement as they relate to a Shelf Registration shall also apply to an Exchange
Offer Registration to the extent, and with such reasonable modifications thereto
as may be, reasonably requested by the Purchaser or by one or more Participating
Broker-Dealers, in each case as provided in clause (ii) below, in order to
expedite or facilitate the disposition of any Exchange Notes by Participating
Broker-Dealers consistent with the positions of the staff of the SEC recited in
Section 4(a) above; PROVIDED THAT:
(i) the Company shall not be required to amend or supplement
the Prospectus contained in the Exchange Offer Registration Statement,
as would otherwise be contemplated by Section 3(i), for a period
exceeding 180 days after the last Exchange Date (as such period may be
extended pursuant to the penultimate paragraph of Section 3 of this
Agreement) and Participating Broker-Dealers shall not be authorized by
the Company to deliver and shall not deliver such Prospectus after such
period in connection with the resales contemplated by this Section 4;
and
(ii) the application of the Shelf Registration procedures set
forth in Section 3 of this Agreement to an Exchange Offer Registration,
to the extent not required by the positions of the staff of the SEC or
the 1933 Act and the rules and regulations thereunder, will be in
conformity with the reasonable request to the Company by the Purchaser
or with the reasonable request in writing to the Company by one or more
broker-dealers who certify to the Purchaser and the Company in writing
that they anticipate that they will be Participating Broker-Dealers;
and PROVIDED FURTHER that, in connection with such application of the
Shelf Registration procedures set forth in Section 3 to an Exchange
Offer Registration, the Company shall be obligated (x) to deal only
with one entity representing the Participating Broker-Dealers, which
shall be Xxxxxx Xxxxxxx & Co. Incorporated unless it elects not to act
as such representative, (y) to pay the fees and expenses of only one
counsel representing the Participating Broker-Dealers, which shall be
counsel to the Purchaser unless such counsel elects not to so act, and
(z) to cause to be delivered only one, if any, "cold comfort" letter
with respect to the Prospectus in the form existing on the last
Exchange Date and with respect to each subsequent amendment or
supplement, if any, effected during the period specified in clause (i)
above.
(c) the Purchaser shall have no liability to the Company or
any Holder with respect to any request that it may make pursuant to Section 4(b)
above.
5. INDEMNIFICATION AND CONTRIBUTION.
(a) The Company agrees to indemnify and hold harmless the
Purchaser, each Holder and each person, if any, who controls the Purchaser or
any Holder within the meaning of either Section 15 of the 1933 Act or Section 20
of the 1934 Act, or is under common control with, or is controlled by, the
Purchaser or any Holder, from and against all losses, claims,
13
damages and liabilities (including, without limitation, any legal or other
expenses reasonably incurred by the Purchaser, any Holder or any such
controlling or affiliated person in connection with defending or investigating
any such action or claim) caused by any untrue statement or alleged untrue
statement of a material fact contained in any Registration Statement (or any
amendment thereto) pursuant to which Exchange Notes or Registrable Notes were
registered under the 1933 Act, including all documents incorporated therein by
reference, or caused by any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, or caused by any untrue statement or alleged untrue
statement of a material fact contained in any Prospectus (as amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto), or caused by any omission or alleged omission to state therein a
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, except insofar as such
losses, claims, damages or liabilities are caused by any such untrue statement
or omission or alleged untrue statement or omission based upon information
relating to the Purchaser or any Holder furnished to the Company in writing by
the Purchaser or any selling Holder expressly for use therein; PROVIDED THAT the
foregoing indemnity agreement shall not inure to the benefit of any Holder or
any Person controlling such Holder, with respect to any sale or disposition of
Registrable Notes by such Holder in violation of the penultimate paragraph of
Section 3 of this Agreement. In connection with any Underwritten Offering
permitted by Section 3, the Company will also indemnify the Underwriters, if
any, selling brokers, dealers and similar securities industry professionals
participating in the distribution, their officers and directors and each Person
who controls such Persons (within the meaning of either Section 15 of the 1933
Act or Section 20 of the 0000 Xxx) to the same extent as provided above with
respect to the indemnification of the Holders, if requested in connection with
any Registration Statement.
(b) Each Holder agrees, severally and not jointly, to
indemnify and hold harmless the Company, the Purchaser and the other selling
Holders, and each of their respective directors, officers who sign the
Registration Statement and each Person, if any, who controls the Company, the
Purchaser and any other selling Holder within the meaning of either Section 15
of the 1933 Act or Section 20 of the 1934 Act to the same extent as the
foregoing indemnity from the Company to the Purchaser and the Holders, but only
with reference to information relating to such Holder furnished to the Company
in writing by such Holder expressly for use in any Registration Statement (or
any amendment thereto) or any Prospectus (or any amendment or supplement
thereto).
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any Person in respect of which
indemnity may be sought pursuant to either paragraph (a) or paragraph (b) above,
such person (the "indemnified party") shall promptly notify the Person against
whom such indemnity may be sought (the "indemnifying party") in writing (but the
failure to so notify an indemnifying party shall not relieve it from any
liability which it may have under this Section, except to the extent that it has
been prejudiced in any material respect by such failure, or from any liability
it may otherwise have) and the indemnifying party, upon request of the
indemnified party, shall retain counsel reasonably
14
satisfactory to the indemnified party to represent the indemnified party and any
others the indemnifying party may designate in such proceeding and shall pay the
fees and disbursements of such counsel related to such proceeding. In any such
proceeding, any indemnified party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnified party in
connection with any proceeding or related proceedings in the same jurisdiction,
be liable for (A) the reasonable fees and expenses of more than one separate
firm (in addition to any local counsel) for the Purchaser and all Persons, if
any, who control the Purchaser within the meaning of either Section 15 of the
1933 Act or Xxxxxxx 00 xx xxx 0000 Xxx, (X) the reasonable fees and expenses of
more than one separate firm (in addition to any local counsel) for the Company,
its directors, its officers who sign the Registration Statement and each Person,
if any, who controls the Company within the meaning of either such Section and
(C) the reasonable fees and expenses of more than one separate firm (in addition
to any local counsel) for all Holders and all Persons, if any, who control any
Holders within the meaning of either such Section, and that all such fees and
expenses shall be reimbursed as they are incurred. In such case involving the
Holders and such Persons who control Holders, such firm shall be designated in
writing by the Majority Holders. In all other cases, such firm shall be
designated by the Company. The indemnifying party shall not be liable for any
settlement of any proceeding effected without its written consent but, if
settled with such consent or if there be a final judgment for the plaintiff, the
indemnifying party agrees to indemnify the indemnified party from and against
any loss or liability by reason of such settlement or judgment. Notwithstanding
the foregoing sentence, if at any time an indemnified party shall have requested
an indemnifying party to reimburse the indemnified party for fees and expenses
of counsel as contemplated by the second and third sentences of this paragraph,
the indemnifying party agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (x) such settlement is
entered into more than 60 days after receipt by such indemnifying party of the
aforesaid request and (y) such indemnifying party shall not have reimbursed the
indemnified party for such fees and expenses of counsel in accordance with such
request prior to the date of such settlement. No indemnifying party shall,
without the prior written consent of the indemnified party (which consent may
not be unreasonably withheld), effect any settlement of any pending or
threatened proceeding in respect of which such indemnified party is or could
have been a party and indemnity could have been sought hereunder (whether or not
any indemnified party is an actual or potential party to such proceeding) 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) To the extent the indemnification provided for in
paragraph (a) or paragraph (b) of this Section 5 is unavailable to an
indemnified party or insufficient in respect of any losses, claims, damages or
liabilities referred to therein, then each indemnifying party under
15
such paragraph, in lieu of indemnifying such indemnified party thereunder, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages or liabilities in such proportion as is
appropriate to reflect the relative fault of the indemnifying party or parties,
on the one hand, and of the indemnified party or parties, on the other hand, in
connection with the statements or omissions that resulted in such losses,
claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of the Company and the Holders 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 Company or by the Holders
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Holders'
respective obligations to contribute pursuant to this Section 5(d) are several
in proportion to the respective principal amount of Registrable Notes of such
Holder that were registered pursuant to a Registration Statement.
(e) The Company and each Holder agree that it would not be
just or equitable if contribution pursuant to this Section 5 were determined by
PRO RATA allocation or by any other method of allocation that does not take
account of the equitable considerations referred to in paragraph (d) above. The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages and liabilities referred to in paragraph (d) above shall be
deemed to include, subject to the limitations set forth above, any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 5, no Holder shall be required to indemnify or
contribute any amount in excess of the amount by which the total price at which
Registrable Notes were sold by such Holder exceeds the amount of any damages
that such Holder has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the 0000
Xxx) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The remedies provided for in this Section 5
are not exclusive and shall not limit any rights or remedies which may otherwise
be available to any indemnified party at law or in equity.
The indemnity and contribution provisions contained in this
Section 5 shall remain operative and in full force and effect regardless of (i)
any termination of this Agreement, (ii) any investigation made by or on behalf
of the Purchaser, any Holder or any Person controlling the Purchaser or any
Holder, or by or on behalf of the Company, its officers or directors or any
Person controlling the Company, (iii) acceptance of any of the Exchange Notes
and (iv) any sale of Registrable Notes pursuant to a Shelf Registration
Statement.
16
6. MISCELLANEOUS.
(a) NO INCONSISTENT AGREEMENTS. The Company has not entered
into, and on or after the date of this Agreement will not enter into, any
agreement which 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 in any way conflict
with and are not inconsistent with the rights granted to the holders of the
Company's other issued and outstanding securities under any such agreements.
(b) AMENDMENTS AND WAIVERS. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given unless the Company has obtained the written consent of Holders
of at least a majority in aggregate principal amount of the outstanding
Registrable Notes which are affected by such amendment, modification,
supplement, waiver or consent; PROVIDED, HOWEVER, that no amendment,
modification, supplement, waiver or consent to any departure from the provisions
of Section 5 hereof shall be effective as against any Holder of Registrable
Notes unless consented to in writing by such Holder.
(c) NOTICES. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand delivery, registered
first-class mail, telex, telecopier or any courier guaranteeing overnight
delivery (i) if to a Holder, at the most current address given by such Holder to
the Company by means of a notice given in accordance with the provisions of this
Section 6(c), which address initially is, with respect to the Purchaser, the
address set forth in the Purchase Agreement; and (ii) if to the Company,
initially at the Company's address set forth in the Purchase Agreement and
thereafter at such other address, notice of which is given in accordance with
the provisions of this Section 6(c).
All such notices and communications shall be deemed to have
been duly given: at the time delivered by hand, if personally delivered; five
business days after being deposited in the mail, postage prepaid, if mailed;
when answered back, if telexed; when receipt is acknowledged, 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 specified in the Indenture.
17
(d) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and be binding upon the successors, assigns and transferees of each
of the parties, including, without limitation and without the need for an
express assignment, subsequent Holders; PROVIDED THAT nothing herein shall be
deemed to permit any assignment, transfer or other disposition of Registrable
Notes in violation of the terms of the Purchase Agreement. If any transferee of
any Holder shall acquire Registrable Notes, in any manner, whether by operation
of law or otherwise, such Registrable Notes shall be held subject to all of the
terms of this Agreement, and by taking and holding such Registrable Notes such
person shall be conclusively deemed to have agreed to be bound by and to perform
all of the terms and provisions of this Agreement and such person shall be
entitled to receive the benefits hereof. The Purchaser (in its capacity as the
Purchaser) shall have no liability or obligation to the Company with respect to
any failure by a Holder to comply with, or any breach by any Holder of, any of
the obligations of such Holder under this Agreement.
(e) PURCHASES AND SALES OF NOTES. The Company shall not, and
shall use its best efforts to cause its affiliates (as defined in Rule 405 under
the 0000 Xxx) not to, purchase and then resell or otherwise transfer any Notes.
(f) THIRD PARTY BENEFICIARY. The Holders shall be third party
beneficiaries to the agreements made hereunder between the Company, on the one
hand, and the Purchaser, on the other hand, and shall have the right to enforce
such agreements directly to the extent it deems such enforcement necessary or
advisable to protect its rights or the rights of Holders hereunder.
(g) 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.
(h) HEADINGS. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(i) GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York.
(j) SEVERABILITY. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be affected or impaired thereby
[THE REST OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
18
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
VIATEL, INC.
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------------------
Name: Xxxxxxx X. Xxxxxxx
Title: President and Chief Executive Officer
Confirmed and accepted as of the date first above written:
XXXXXX XXXXXXX & CO. INCORPORATED
By: /s/ Xxxxx X. Xxxxx
-----------------------------------
Name: Xxxxx X. Xxxxx
Title: Vice President
