TRANS WORLD AIRLINES, INC.
10 1/4% Mandatory Conversion Equity Notes due 1999
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement")
is made and entered into as of June 16, 1998, by and among Trans
World Airlines, Inc., a Delaware corporation (the "Company"),
First Security Bank, National Association, as Owner Trustee (the
"Owner Trustee") under the Trust Agreement N607TW dated as of
March 28, 1995 between the Owner Trustee and Internationale
Nederlanden Aviation Lease Delaware, Inc. (currently known as ING
Lease Delaware, Inc.) (the "Original Beneficiary") and Lazard
Freres & Co. LLC ("Lazard"). (The Original Beneficiary has
assigned its beneficial rights in the trust created by such Trust
Agreement to 767 Leasing HY, LLC ("767 Leasing").) Subject to the
terms and conditions stated in the Aircraft Sale and Note
Purchase Agreement made and entered into as of the 16th day of
June, 1998 among the Company, the Owner Trustee, 767 Leasing and
Lazard (the "Sale Agreement"), the Owner Trustee will sell to the
Company one Boeing 767-231 ETOPS aircraft and its associated
engines for $27,500,000, payable by the issuance by the Company
of (i) $14,500,000 aggregate principal amount of the Company's 10
1/4% Senior Secured Notes due 2003 (the "Notes") and (ii)
$13,000,000 aggregate principal amount of the Company's 10 1/4%
Mandatory Conversion Equity Notes due 1999 (the "Equity Notes").
The Notes will be issued pursuant to an indenture dated as of
June 16, 1998 (the "Indenture"), between the Company and First
Security Bank, National Association, as trustee (the "Trustee").
This Agreement is made pursuant to the Sale Agreement.
In order to fulfill its obligations to the Owner Trustee and
Lazard under the Sale Agreement, the Company has agreed to
provide the registration rights set forth in this Agreement. The
execution and delivery of this Agreement is a condition to the
closing of the Sale Agreement. All capitalized terms used but not
defined herein shall have the meanings ascribed to them in the
Indenture (as defined below) governing the Equity Notes.
The parties hereby agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement, the following capitalized
terms shall have the following meanings:
Act: The Securities Act of 1933, as amended.
Closing Date: The date on which the closing of the
sale of the Aircraft to the Company in exchange for Senior Notes
and Equity Notes to the Owner Trustee is consummated pursuant to
the Sale Agreement.
Commission: The U.S. Securities and Exchange Commission and
any successor federal agency having similar powers.
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Common Stock: Includes any stock of any class of the Company
which has no preference in respect of dividends or of amounts
payable in the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Company and which is not subject
to redemption by the Company. Unless the context otherwise
requires, all references to Common Stock shall include the
associated Rights.
Damages Payment Date: The last business day of each month.
Effectiveness Target Date: As defined in Section 3.
Equity Notes: 10 1/4% Mandatory Conversion Equity Notes due
1999 of the Company.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Holder: As defined in Section 2(b) hereof.
Indenture: The Indenture dated as of June 16, 1998
between the Company and First Security Bank, National Association
(the "Trustee"), pursuant to which the Equity Notes have been
issued, as such Indenture is amended or supplemented from time to
time in accordance with the terms thereof.
NASD: National Association of Securities Dealers, Inc.
Person: An individual, partnership, corporation,
limited liability company, trust or unincorporated organization
or other entity, or a government or agency or political
subdivision thereof.
Private Placement Memorandum: The Private Placement
Memorandum, dated June 16, 1998, and all amendments and
supplements thereto, relating to the Equity Notes and prepared by
the Company pursuant to the Sale Agreement.
Prospectus: The prospectus included in the Shelf
Registration Statement, as amended or supplemented by any
prospectus supplement and by all other amendments and supplements
to the prospectus included in the Shelf Registration Statement,
including post-effective amendments, and all material which may
be incorporated by reference into such prospectus.
Record Holder: With respect to any Damages Payment
Date relating to the Transfer Restricted Securities, each Person
who is a Holder of record on the business day immediately
preceding such Damages Payment Date.
Registrar: As defined in the Indenture.
Rights: The Rights of the Company entitling the holder
to purchase one one-hundredth of a share of the Company's Series
A Participating Preferred Stock, par value $.01 per share, under
certain circumstances issued pursuant to the Rights Agreement
dated as of
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December 19, 1995 between the Company and American Stock Transfer &
Trust Company, as Rights Agent, supplemented as of March 18, 1996 and
as it may be further amended or supplemented from time to time.
Shelf Registration Statement: As defined in Section 3(a)
hereof.
Transfer Restricted Securities: Each share of Common
Stock, issued upon conversion of the Equity Notes, until the date
on which each such share of Common Stock (i) has been effectively
registered under the Act and disposed of in accordance with the
Shelf Registration Statement or (ii) is distributed to the public
pursuant to Rule 144 under the Act or is salable pursuant to Rule
144(k) under the Act (or similar provisions then in force).
Usable: Complies with the applicable rules and
regulations of the Act including, without limitation, Rule 3-12
of Regulation S-X and Item 512 of Regulation S-K.
SECTION 2. SECURITIES SUBJECT TO THIS AGREEMENT
(a) Transfer Restricted Securities. The securities entitled
to the benefits of this Agreement are the Transfer Restricted
Securities.
(b) Holders of Transfer Restricted Securities. A
Person is deemed to be a holder of record of Transfer Restricted
Securities (each, a "Holder") whenever such Person owns Transfer
Restricted Securities or is entitled to receive Transfer
Restricted Securities upon conversion of the Equity Notes.
SECTION 3. SHELF REGISTRATION AND LISTING
(a) The Company shall file with the Commission, as
soon as practicable after the Closing Date, but in no event prior
to June 23, 1998 and in any event on or prior to the date 60 days
after the Closing Date, a shelf registration statement pursuant
to Rule 415 under the Act (the "Shelf Registration Statement") on
Form S-3 to cover resales of all Transfer Restricted Securities
by the Holders thereof who have provided the information required
by Section 3(b) hereof; provided that the Company may file the
Shelf Registration Statement on Form S-1 or Form S-2 if Form S-3
is not then available to the Company. The Company will use its
reasonable best efforts to cause such Shelf Registration
Statement to be declared effective by the Commission within 150
days after the Closing Date (the "Effectiveness Target Date").
The Company shall use its reasonable best efforts to keep such
Shelf Registration Statement continuously effective, subject to
the provisions of Section 5 hereof, until the earlier of (i) the
sale of all Transfer Restricted Securities covered by the Shelf
Registration Statement, and (ii) the expiration of two years
after the date of original issuance of the Equity Notes or, if
the period applicable under Rule 144(k) under the Act, or any
successor provision for such securities is shortened, such
shorter period. Subject to the right of the Company to have the
Shelf Registration Statement not be effective for periods of time
set forth in Section 5 hereof, the Company further agrees to use
its reasonable best efforts to prevent the happening of any event
that would cause the Shelf Registration Statement to contain a
material misstatement or omission or to be not effective and
usable for resale of the Transfer Restricted Securities during
the period
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that such Shelf Registration Statement is required to be
effective and usable. Upon the occurrence of any event that would
cause the Shelf Registration Statement (i) to contain a material
misstatement or omission or (ii) to not be effective or usable
for resale of Transfer Restricted Securities during the period
that such Shelf Registration Statement is required to be
effective and usable, the Company shall promptly file an
amendment to the Shelf Registration Statement, in the case of
clause (i), correcting any such misstatement or omission, and in
the case of either clause (i) or (ii), use its reasonable best
efforts to cause such amendment to be declared effective and such
Shelf Registration Statement to become usable as soon as
practicable thereafter. The Company's obligation to maintain an
effective Shelf Registration Statement shall be extended for the
amount of time that such Shelf Registration shall not have been
effective or otherwise usable.
(b) No Holder may include any of its Transfer
Restricted Securities in any Shelf Registration Statement
pursuant to this Agreement unless such Holder furnishes to the
Company in writing, within 10 business days after receipt of a
request therefor (which initial request shall be made within 40
days after the Closing Date to the Holders on a record date not
more than 5 days prior to such request), such information and
representations and warranties as the Company may reasonably
request for use in connection with any Shelf Registration
Statement or Prospectus or preliminary Prospectus included
therein. No Holder shall be entitled to liquidated damages
pursuant to Section 4 hereof if such Holder's Transfer Restricted
Securities are excluded from a Shelf Registration Statement
because such Holder failed to furnish the Company in writing such
information and representations and warranties reasonably
requested by the Company for use in connection with such Shelf
Registration Statement or Prospectus or preliminary Prospectus
included therein. Each Holder as to which any Shelf Registration
Statement is being effected agrees to furnish promptly to the
Company all information required to be disclosed in order to make
the information previously provided to the Company by such Holder
not materially misleading.
(c) The Company shall use its reasonable best efforts
to have the shares of Common Stock issuable upon conversion of
the Equity Notes approved for listing on the American Stock
Exchange ("ASE"), or on such other stock exchange or market as
the Common Stock is then principally traded, no later than the
effectiveness date of the Shelf Registration Statement relating
to such Common Stock, and, if applicable, to maintain such
listing until the earlier to occur of (i) the sale of all
Transfer Restricted Securities covered by the Shelf Registration
Statement, and (ii) the expiration of two years after the date of
issuance of the Equity Notes or, if the period applicable under
Rule 144(k) under the Act, or any successor provision relating to
the free transferability of the Transfer Restricted Securities,
is shortened, such shorter period.
SECTION 4. LIQUIDATED DAMAGES
Each of the Company, on behalf of itself, the Owner
Trustee, on behalf of the Beneficiary, and Lazard, on behalf of
itself (and each of them on behalf of each subsequent Holder),
agrees that (a) the Holders will suffer damages if (i) the Shelf
Registration Statement is not maintained in the manner and within
the time periods contemplated by Section 3 hereof or (ii) the
Company does not maintain the listing of the Common Stock
issuable on the Conversion
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Date (as defined in the Indenture) on the ASE, or such other
stock exchange or market on which the Common Stock is principally
traded, within the time period contemplated by Section 3 and (b)
it would not be feasible to ascertain the extent of such damages
with precision. Accordingly, if (x) the Shelf Registration
Statement is filed and declared effective but shall on or after
the Conversion Date cease to be effective (without being
succeeded immediately by an additional Shelf Registration
Statement filed and declared effective) or usable for a period of
time which shall exceed 60 days in the aggregate during any year
(defined as any period of 365 days commencing on or after the
date the Shelf Registration Statement is declared effective) or
(y) the Company shall fail to maintain the approval for listing
of the shares of Common Stock that constitute the Transfer
Restricted Securities in accordance with Section 3(c) (each such
event, an "Effectiveness Default"), the Company shall pay
liquidated damages until the Shelf Registration Statement again
becomes effective and usable or the approval for listing is cured
to each Holder who has complied with such Holder's obligations
hereunder, during the first 90-day period immediately following
the occurrence of any such Effectiveness Default in an amount
equal to $0.01 per week per share of Common Stock (subject to
adjustment in the event of stock splits, stock recombinations,
stock dividends and the like) constituting Transfer Restricted
Securities held by such Holder. The amount of the liquidated
damages will increase by an additional $0.01 per week per share
of Common Stock (subject to adjustment as set forth above)
constituting Transfer Restricted Securities held by such Holder
for each subsequent 90-day period until the Shelf Registration
Statement again becomes effective and usable or the approval for
listing is cured, up to a maximum amount of liquidated damages
with respect to any such Effectiveness Default of $0.05 per week
per share (subject to adjustment as set forth above) of Common
Stock constituting Transfer Restricted Securities. All accrued
and unpaid liquidated damages shall be paid to Record Holders by
wire transfer of immediately available funds or by federal funds
check by the Company on each Damages Payment Date. If the Company
defaults in a payment of any liquidated damages hereunder, it
shall pay the liquidated damages, plus interest on the liquidated
damages at the rate of twelve percent (12%) per annum to the
extent permitted by law, to the persons who are Holders on the
subsequent Damages Payment Date. Following the cure of an
Effectiveness Default, liquidated damages will cease to accrue
with respect to such Effectiveness Default.
All of the Company's obligations to pay accrued but
unpaid liquidated damages set forth in the preceding paragraph
which are outstanding with respect to any Transfer Restricted
Security at the time such security ceases to be a Transfer
Restricted Security shall survive until such time as all such
obligations with respect to such security shall have been
satisfied in full.
The parties hereto agree that the liquidated damages
provided in this Section 4 constitute a reasonable estimate of
the damages that will be incurred by Holders if, on or after the
Conversion Date, after using reasonable best efforts, the Company
is unable (x) to maintain the effectiveness of the Shelf
Registration Statement for the period required by Section 3(a) or
(y) to maintain the approval for listing of the shares of Common
Stock that constitute Transfer Restricted Securities for the
period required by Section 3(c). It is the intention of the
parties that if an Effectiveness Default shall occur as a result
of the Company's failure to use its reasonable
best efforts to cause the undertakings described in clauses (x)
and (y) of the preceding sentence to occur, Holders shall be
entitled to any damages appropriate under applicable law, which
damages shall not be limited to the liquidated damages under this
Section 4; provided that any amounts of
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interest or liquidated damages paid pursuant to Section 2.2 of
the Indenture or Section 4 of this Agreement, respectively, shall
be credited against any amounts awarded to Holders by a court of
competent jurisdiction.
SECTION 5. REGISTRATION PROCEDURES
In connection with the Shelf Registration Statement,
the Company will use its reasonable best efforts to effect such
registration to permit the sale of the Transfer Restricted
Securities being sold in accordance with the intended method or
methods of distribution or disposition thereof, and pursuant
thereto the Company will as expeditiously as possible:
(a) on or prior to the date 60 days after the Closing
Date, prepare and file with the Commission a Shelf Registration
Statement relating to the registration on Form S-3 (or, if Form
S-3 is not available, on Form S-1 or Form S-2) for the sale of
the Transfer Restricted Securities in accordance with the
intended method or methods of distribution thereof and shall
include or incorporate all required financial statements,
reports, schedules, exhibits and other documents; cause to be
made, or otherwise cooperate and assist in any filings required
to be made with the NASD and use its reasonable best efforts to
cause such Shelf Registration Statement to become effective and
approved on or prior to the Effectiveness Target Date by such
governmental agencies or authorities as may be necessary to
enable the selling Holders to consummate the disposition of such
Transfer Restricted Securities; provided that before filing a
Shelf Registration Statement or any Prospectus, or any amendments
or supplements thereto, including documents incorporated by
reference after the initial filing of the Shelf Registration
Statement, the Company shall furnish to such Holders and
underwriters, if any, copies of all such documents proposed to be
filed, which documents shall be subject to the review of such
Holders, and the Company shall not file any Shelf Registration
Statement or amendment thereto or any Prospectus or any
supplement thereto (including such documents incorporated by
reference) to which the Holders of the Transfer Restricted
Securities covered by such Shelf Registration Statement or the
underwriters, if any, shall reasonably object in writing within
four business days after the receipt thereof on the grounds that
such Shelf Registration Statement, Prospectus, amendment or
supplement does not (x) comply in all material respects with the
requirements of the Act or the rules and regulations thereunder
or (y) fairly or accurately describe any description or other
information pertaining to any of such Holders or concerning the
plan of distribution contemplated by such Holders;
(b) prepare and file with the Commission such
amendments and post-effective amendments to the Shelf
Registration Statement as may be necessary to keep the Shelf
Registration Statement effective for the applicable period set
forth in Section 3(a) hereof; cause the Prospectus to be
supplemented by any required Prospectus supplement, and as so
supplemented to be filed pursuant to Rule 424 under the Act, and
to comply fully with the applicable provisions of Rule 424 under
the Act in a timely manner; and comply with the provisions of the
Act with respect to the disposition of all securities covered by
such Shelf Registration Statement during the applicable period in
accordance with the intended method or methods of distribution by
the sellers thereof set forth in such Shelf Registration
Statement or supplement to the Prospectus;
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(c) advise the selling Holders promptly and, if requested
by such Persons, to confirm such advice in writing, (i) when the
Prospectus or any Prospectus supplement or post-effective
amendment has been filed, and, with respect to the Shelf
Registration Statement or any post-effective amendment thereto,
when the same has become effective, (ii) of any request by the
Commission for amendments to the Shelf Registration Statement or
amendments or supplements to the Prospectus or for additional
information relating thereto, (iii) of the issuance by the
Commission of any stop order suspending the effectiveness of the
Shelf Registration Statement under the Act or of the suspension
by any state securities commission of the qualification of the
Transfer Restricted Securities for offering or sale in any
jurisdiction, or the initiation of any proceeding for any of the
preceding purposes, (iv) if at any time the representations and
warranties of the Company contemplated by paragraph (l)(i) below
cease to be true and correct, and (v) of the existence of any
fact and the happening of any event that makes any statement of a
material fact made in the Shelf Registration Statement, the
Prospectus, any amendment or supplement thereto, or any document
incorporated by reference therein untrue, or that requires the
making of any additions to or changes in the Shelf Registration
Statement or the Prospectus, any amendment or supplement thereto,
or any document incorporated by reference therein in order to
make the statements therein not misleading in the light of the
circumstances then existing. If at any time the Commission shall
issue any stop order suspending the effectiveness of the Shelf
Registration Statement, or any state securities commission or
other regulatory authority shall issue an order suspending the
qualification or exemption from qualification of the Transfer
Restricted Securities under state securities or Blue Sky laws,
the Company shall use its best efforts to obtain the withdrawal
or lifting of such order at the earliest possible time;
(d) no less than 24 hours prior to the filing of any
document that is to be incorporated by reference into the Shelf
Registration Statement or the Prospectus (after the initial
filing of the Shelf Registration Statement), provide copies of
such document to the selling Holders and underwriters, if any,
make the Company's representatives available at reasonable times
for discussion of such document and include such information in
such document prior to the filing thereof as such selling Holders
or underwriters may reasonably and timely request;
(e) furnish to each selling Holder and underwriter, if
any, without charge, at least one copy of the Shelf Registration
Statement, as first filed with the Commission, and of each
amendment thereto, including all documents incorporated by
reference therein and all exhibits (including exhibits
incorporated therein by reference);
(f) deliver to each selling Holder and underwriter, if
any, without charge, as many copies of the Prospectus (including
each preliminary Prospectus) and any amendment or supplement
thereto as such Persons may reasonably request; the Company
consents to the use of the Prospectus and any amendment or
supplement thereto by each of the selling Holders and
underwriters, if any, in connection with the public offering and
sale of the Transfer Restricted Securities covered by the
Prospectus or any amendment or supplement thereto;
(g) prior to any public offering of Transfer
Restricted Securities, use its reasonable best efforts to cause
the Transfer Restricted Securities covered by the Shelf
Registration Statement to be registered with or approved by such
other governmental agencies or authorities as may be necessary to
enable the seller or sellers thereof to consummate the
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disposition of such Transfer Restricted Securities and otherwise
cooperate with the selling Holders and underwriters, if any, and
their respective counsel in connection with the registration and
qualification of the Transfer Restricted Securities under the
securities or Blue Sky laws of such jurisdictions as the selling
Holders and underwriters, if any, may reasonably request and do
any and all other acts or things necessary or advisable to enable
the disposition in such jurisdictions of the Transfer Restricted
Securities covered by the Shelf Registration Statement; provided,
however, that the Company shall be required neither to register
or qualify as a foreign corporation where it is not now so
qualified nor to take any action that would subject it to the
service of process in suits or to taxation, other than as to
matters and transactions relating to the Shelf Registration
Statement, in any jurisdiction where it is not now so subject;
(h) in connection with any sale of Transfer Restricted
Securities that will result in such securities no longer being
Transfer Restricted Securities, cooperate with the selling
Holders to facilitate the timely preparation and delivery of
certificates representing Transfer Restricted Securities to be
sold and not bearing any restrictive legends; and enable such
Transfer Restricted Securities to be in such denominations and
registered in such names as the Holders may request at least two
business days prior to any sale of Transfer Restricted Securities
made by such Holders;
(i) use its reasonable best efforts to cause the
Transfer Restricted Securities covered by the Shelf Registration
Statement to be registered with or approved by such other
governmental agencies or authorities as may be necessary to
enable the seller or sellers thereof to consummate the
disposition of such Transfer Restricted Securities, subject to
the proviso contained in clause (g) above;
(j) if any fact or event contemplated by clause (v) of
paragraph (c) above shall exist or have occurred, as promptly as
practicable thereafter, prepare a supplement or post-effective
amendment to the Shelf Registration Statement or related
Prospectus or any document incorporated therein by reference or
file any other required document so that, as thereafter delivered
to the purchasers of Transfer Restricted Securities, the
Prospectus will not contain an untrue statement of a material
fact or omit to state any material fact necessary to make the
statements therein not misleading;
(k) provide CUSIP numbers for all Transfer Restricted
Securities not later than the effective date of the Shelf
Registration Statement and provide the transfer agent for the
Common Stock with printed certificates for the Transfer
Restricted Securities;
(l) enter into such agreements and take all such other
actions consistent with its obligations hereunder in connection
therewith and as may be reasonably required in order to expedite
or facilitate the disposition of the Transfer Restricted
Securities pursuant to the Shelf Registration Statement, and in
such connection the Company shall (i) make such representations
and warranties to the Holders and underwriters, if any, in form,
substance and scope as are customarily made by issuers to
underwriters in primary underwritten offerings and covering
matters including, but not limited to, those set forth in the
Sale Agreement; (ii) obtain opinions of counsel to the Company
and updates thereof (which counsel and opinions (in form, scope
and substance) shall be reasonably satisfactory to the Holders of
the Transfer Restricted Securities
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being sold and underwriters, if any) addressed to each selling
Holder and underwriter, if any, requesting the same and covering
such matters as are customarily covered in company counsel
opinions to underwriters in primary underwritten offerings; (iii)
obtain "cold comfort" letters and updates thereof from the
Company's independent certified public accountants addressed to
the selling Holders and underwriters, if any, requesting the
same, such letters to be in customary form and covering matters
of the type customarily covered in "cold comfort" letters to
underwriters in connection with primary underwritten offerings;
and (iv) deliver such documents and certificates as may be
reasonably requested by the Holders of the Transfer Restricted
Securities being sold and underwriters, if any, to evidence
compliance with clause (i) above and with any customary
conditions contained in the underwriting agreement or other
agreement entered into by the Company pursuant to this clause
(1);
(m) subject to appropriate confidentiality
arrangements being entered into, make available at reasonable
times for inspection by the Holders of the Transfer Restricted
Securities participating in any disposition pursuant to such
Shelf Registration Statement, any underwriters and any attorney
or accountant retained by such selling Holders or underwriters,
all financial and other records, pertinent corporate documents
and properties of the Company and cause the Company's officers,
directors and employees to supply all information reasonably
requested by any such Holder, underwriter, attorney or accountant
at reasonable times in connection with such Shelf Registration
Statement subsequent to the filing thereof and prior to its
effectiveness;
(n) otherwise use its reasonable best efforts to
comply with all applicable rules and regulations of the
Commission, and make generally available to its security holders,
as soon as reasonably practicable, a consolidated earnings
statement (which need not be audited) for the twelve-month
period, beginning with the first month of the Company's first
fiscal quarter commencing after the effective date of the Shelf
Registration Statement;
(o) use its reasonable best efforts to obtain the
withdrawal of any order suspending the effectiveness of the Shelf
Registration Statement at the earliest possible moment; use its
reasonable best efforts (i) to prevent the entry of any stop
order affecting the Registration Statement and (ii) to remove any
such stop order if entered; and
(p) cooperate and assist in any filings required to be
made with the NASD.
The Company agrees that it will not include in the
registration contemplated by the Shelf Registration Statement any
securities other than the Transfer Restricted Securities. The
Company represents and warrants to the Owner Trustee and Lazard
that it will not be required to include under the Shelf
Registration Statement any other securities.
The Owner Trustee, on behalf of the Beneficiary,
Lazard, on behalf of itself, and both the Owner Trustee and
Lazard, on behalf of each subsequent Holder, agree by acquisition
of Transfer Restricted Securities that, upon receipt of any
notice from the Company of the existence of any fact or the
happening of any event of the kind described in clause (v) of
Section 5(c) hereof, such Holder will forthwith discontinue
disposition of Transfer Restricted Securities pursuant to the
Shelf Registration Statement until such Holder's receipt of the
copies of the
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supplemented or amended Prospectus contemplated by Section 5(j)
hereof, or until it is advised in writing (the "Advice") by the
Company that the use of the Prospectus may be resumed, and has
received copies of any additional or supplemental filings which
are incorporated by reference in the Prospectus. If so directed
by the Company, each Holder will, or will request the managing
underwriter or underwriters, if any, to deliver to the Company
(at the Company's expense) all copies, other than permanent file
copies then in such Holder's possession, of the Prospectus
covering such Transfer Restricted Securities current at the time
of receipt of such notice.
SECTION 6. REGISTRATION EXPENSES
All expenses incident to the Company's performance of
or compliance with this Agreement will be borne by the Company,
regardless of whether a Shelf Registration Statement becomes
effective, including without limitation:
(i) all registration and filing fees and expenses;
(ii) fees and expenses of compliance with federal
securities or state blue sky laws (including reasonable
fees and disbursements of one counsel to the Holders and
the underwriters, if any, in connection with blue sky
qualifications of the Transfer Restricted Securities);
(iii) expenses of printing (including, without
limitation, expenses of printing or engraving certificates
for the Transfer Restricted Securities, expenses of
printing or engraving certificates for the Common Stock and
expenses of printing prospectuses), messenger and delivery
services and telephone;
(iv) fees and disbursements of counsel for the
Company and reasonable fees and disbursements of one
counsel for the Holders chosen by the Holders of a majority
of the outstanding Transfer Restricted Securities
(determined as provided in Section 10(d));
(v) fees and disbursements of all independent
certified public accountants of the Company (including the
expenses of any special audit and "cold comfort" letters
required by or incident to such performance);
(vi) filing fees associated with any NASD filing
required to be made in connection with the Shelf
Registration Statement;
(vii) fees and expenses of listing the Transfer
Restricted Securities on any securities exchange or
quotation system in accordance with Section 3(c) hereof;
and
(viii) securities acts liability insurance, if the
Company desires such insurance.
All such expenses, including without limitation those
described in the foregoing clauses (i) to (viii) are referred to
herein as "Registration Expenses."
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The Company will, in any event, bear its internal expenses
(including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties),
the expense of any annual audit, and the fees and expenses of any
Person, including special experts, retained by the Company. The
Holders shall bear the expense of any broker's commission or
underwriters' discount or commission.
SECTION 7. UNDERWRITING
If any of the Transfer Restricted Securities covered
by any Shelf Registration Statement are to be sold in an
underwritten offering, the investment banker(s) and manager(s)
that will manage the offering will be selected by the Holders of
a majority of the then outstanding Transfer Restricted Securities
(determined in accordance with Section 10(d)) included in such
offering (after consultation with the Company as to such
selection and upon the written consent of the Company, which
consent shall not be unreasonably withheld or delayed). If
requested by the underwriters, the Company will promptly enter
into an underwriting agreement reasonably acceptable to the
Company with such underwriters for such offering, such agreement
to contain such representations and warranties by the Company and
such other terms and conditions as are customary for underwriting
agreements with respect to secondary offerings, including without
limitation, indemnities to the effect and to the extent provided
in Section 8 hereof. The Holders on whose behalf such securities
are being distributed shall be party to any such underwriting
agreement. Such Holders shall not be required by the Company to
make any representations or warranties to the underwriters with
respect to the Company or the Transfer Restricted Securities
(other than that the Holders are conveying such securities free
and clear of all pledges, security interests, liens, charges,
encumbrances, agreements, equities, claims and options of
whatever nature), and the Holders shall not be required to
indemnify the Company or the underwriters (other than with
respect to the matters, and to the extent, provided in Section
8). Furthermore, the Company shall make available for inspection
by the Holders, any underwriter participating in any disposition
pursuant to such Shelf Registration Statement, and any attorney,
accountant or other agent retained by any Holder or underwriter,
all financial and other records and other information, pertinent
corporate documents and properties of the Company as shall be
reasonably necessary to enable them to exercise their due
diligence responsibilities.
No Holder may participate in any underwritten
distribution hereunder unless such Holder (a) agrees to sell such
Holder's Transfer Restricted Securities on the basis provided in
any underwriting arrangements approved in accordance with the
terms hereof, and (b) completes and executes all questionnaires,
powers of attorney, indemnities, underwriting agreements and
other documents required under the terms of such underwriting
arrangements.
SECTION 8. INDEMNIFICATION
(a) The Company agrees to indemnify and hold harmless
each Holder and each person, if any, who controls such Holder
within the meaning of the Act or the Exchange Act (each Holder
and such controlling persons referred to in this Section 8(a) and
the Company and its controlling persons referred to in Section
8(b), being collectively referred to herein, as the case may be,
as the "indemnified parties") from and against any losses,
claims, damages or liabilities, joint or several, or any actions
in respect thereof (including, but not limited to, any losses,
claims,
12
damages, liabilities or actions relating to purchases and sales
of the Transfer Restricted Securities) to which each indemnified
party may become subject under the Act, the Exchange Act or
otherwise, insofar as such losses, claims, damages, liabilities
or actions arise out of or are based upon any untrue statement or
alleged untrue statement of a material fact contained in the
Shelf Registration Statement or Prospectus or in any amendment or
supplement thereto or in any preliminary prospectus relating to
the Shelf Registration Statement, or arise out of, or are based
upon the omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which
they were made, not misleading, and shall reimburse, as incurred,
the indemnified parties for any legal or other expenses
reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action in
respect thereof; provided, however, that (i) the Company shall
not be liable in any such case to the extent that such loss,
claim, damage or liability arises out of or is based upon any
untrue statement or alleged untrue statement or omission or
alleged omission made in the Shelf Registration Statement or
Prospectus or in any amendment or supplement thereto or in any
preliminary prospectus relating to the Shelf Registration
Statement in reliance upon and in conformity with written
information pertaining to such Holder and furnished to the
Company by or on behalf of such Holder specifically for inclusion
therein, (ii) with respect to any untrue statement or omission or
alleged untrue statement or omission made in the Prospectus
relating to such Shelf Registration Statement, the indemnity
agreement contained in this subsection (a) shall not inure to the
benefit of any person as to which there is a prospectus delivery
requirement (a "Delivering Seller") that sold the Transfer
Restricted Securities to the person asserting any such losses,
claims, damages or liabilities to the extent that any such loss,
claim, damage or liability of such Delivering Seller results from
the fact that there was not sent or given to such person, on or
prior to the written confirmation of such sale, a copy of the
Prospectus, as amended and supplemented, provided that (I) the
Company shall have previously furnished copies thereof to such
Delivering Seller in accordance with this Agreement and (II) such
furnished Prospectus, as amended and supplemented, would have
corrected any such untrue statement or omission or alleged untrue
statement or omission, and (iii) this indemnity agreement will be
in addition to any liability which the Company may otherwise have
to such indemnified party. The Company shall also indemnify
underwriters, selling brokers, dealer-managers and similar
securities industry professionals participating in the
distribution (in each case as described in the Shelf Registration
Statement), their officers and directors and each person who
controls such persons within the meaning of the Act or the
Exchange Act to the same extent as provided above with respect to
the indemnification of the Holders if requested by such Holders.
(b) Each Holder, severally and not jointly, will
indemnify and hold harmless the Company, each other Holder and
each person, if any, who controls the Company and each such
Holder within the meaning of the Act or the Exchange Act from and
against any losses, claims, damages or liabilities or any actions
in respect thereof to which the Company, each other Holder or any
such controlling person may become subject under the Act, the
Exchange Act or otherwise, insofar as such losses, claims,
damages, liabilities or actions arise out of or are based upon
any untrue statement or alleged untrue statement of a material
fact contained in the Shelf Registration Statement or Prospectus
or in any amendment or supplement thereto or in any preliminary
prospectus relating to the Shelf Registration Statement, or arise
out of or are based
13
upon the omission or alleged omission to state therein a material
fact necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, but in
each case only to the extent that the untrue statement or alleged
untrue statement or omission or alleged omission was made in
reliance upon and in conformity with written information
pertaining to such Holder and furnished to the Company by or on
behalf of such Holder specifically for inclusion therein; and,
subject to the limitation set forth immediately preceding this
clause, shall reimburse, as incurred, the Company and each such
Holder for any legal or other expenses reasonably incurred by the
Company, each other Holder or any such controlling person in
connection with investigating or defending any loss, claim,
damage, liability or action in respect thereof. This indemnity
agreement will be in addition to any liability which such Holder
may otherwise have to the Company, each other Holder or any of
their respective controlling persons.
(c) Promptly after receipt by an indemnified party
under this Section 8 of notice of the commencement of any action
or proceeding (including a governmental investigation), such
indemnified party will, if a claim in respect thereof is to be
made against the indemnifying party under this Section 8, notify
the indemnifying party of the commencement thereof; but the
omission so to notify the indemnifying party will not, in any
event, relieve the indemnifying party from any obligations to any
indemnified party, except to the extent that it is prejudiced or
harmed in any material respect by failure to give such prompt
notice. In case any such action is brought against any
indemnified party, and it notifies the indemnifying party of the
commencement thereof, the indemnifying party will be entitled to
participate therein and, to the extent that it may wish, jointly
with any other indemnifying party similarly notified, to assume
the defense thereof, with one counsel (and local counsel as
necessary) reasonably satisfactory to such indemnified party (who
shall not, except with the consent of the indemnified party, be
counsel to the indemnifying party), and after notice from the
indemnifying party to such indemnified party of its election so
to assume the defense thereof the indemnifying party will not be
liable to such indemnified party under this Section 8 for any
legal or other expenses, other than reasonable costs of
investigation, subsequently incurred by such indemnified party in
connection with the defense thereof. No indemnifying party shall,
without the prior written consent of the indemnified party, not
to be unreasonably withheld, effect any settlement of any pending
or threatened action 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 any claims that are the subject matter of such
action and does not include any injunctive relief against such
indemnified party. No indemnifying party shall be liable for any
amounts paid in settlement of any action or claim without its
written consent, which consent shall not be unreasonably
withheld.
(d) In order to provide for just and equitable
contribution in circumstances in which the indemnification
provided for in the foregoing paragraphs of this Section 8 is
applicable in accordance with its terms but for any reason is
held to be unavailable or insufficient, then each indemnifying
party will contribute to the total losses, claims, liabilities,
expenses and damages (including any investigative, legal and
other expenses reasonably incurred in connection with, and any
amount paid in settlement of, any action, suit or proceeding or
any claim asserted, but
14
after deducting any contribution received by the indemnifying
party from persons other than the party to be indemnified), to
which the indemnifying party and the party to be indemnified may
be subject in such proportion as shall be appropriate to reflect
the relative fault of the indemnifying party, on the one hand,
and the party to be indemnified, on the other, with respect to
the statements or omissions which resulted in such loss, claim,
liability, expense or damage, or action in respect thereof, as
well as any other relevant equitable considerations with respect
to such offering. Such relative fault shall be determined by
reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied
by the Company, on the one hand, or such Holder or such other
indemnified person, as the case may be, on the other, the intent
of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such statement
or omission. The parties hereto agree that it would not be just
and equitable if contributions pursuant to this Section 8(d) were
to be determined by pro rata allocation or by any other method of
allocation which does not take into account the equitable
considerations referred to herein. The amount paid or payable by
an indemnified party as a result of the losses, claims,
liabilities, expenses or damages, or actions in respect thereof,
referred to above in this Section 8(d) shall be deemed to
include, for purpose of this Section 8(d), any legal or other
expenses reasonably incurred by such indemnified party in
connection with investigating or defending any action or claim
which is the subject of this subsection (d). Notwithstanding the
provisions of this Section 8(d), the Holders of the Securities
shall not be required to contribute any amount in excess of the
amount by which the net proceeds received by such Holders from
the sale of the Securities pursuant to a Registration Statement
exceeds the amount of damages which such Holders have otherwise
been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person found guilty
of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) will be entitled to contribution
from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 8(d), any person
who controls a party to this Agreement within the meaning of the
Securities Act or the Exchange Act will have the same rights to
contribution as that party, subject in each case to the
provisions hereof. Any party entitled to contribution, promptly
after receipt of notice of commencement of any action against
such party in respect of which a claim for contribution may be
made under this Section 8(d), will notify any such party or
parties from whom contribution may be sought, but the omission so
to notify will not relieve the party or parties from whom
contribution may be sought from any other obligation it or they
may have under this Section 8(d). Except for a settlement entered
into pursuant to the penultimate sentence of Section 8(c) hereof,
no party will be liable for contribution with respect to any
action or claim settled without its written consent (which
consent will not be unreasonably withheld or delayed).
(e) The agreements contained in this Section 8 shall
survive the sale of the Transfer Restricted Securities pursuant
to the Shelf Registration Statement and shall remain in full
force and effect, regardless of any termination or cancellation
of this Agreement or any investigation made by or on behalf of
any indemnified party.
SECTION 9. RULE 144
The Company shall use its reasonable best efforts to
file on a timely basis all such reports required to be filed
under the Exchange Act as, and endeavor in good faith to take
such
15
other actions as, are reasonably necessary to enable Holders to
sell Transfer Restricted Securities without registration under
the Act within the limitation of the exemptions provided by (a)
Rule 144 under the Act, as such Rule may be amended from time to
time, and (b) any similar rules or regulations hereafter adopted
by the Commission. Upon request of any Holder, the Company will
deliver a written statement as to whether it has complied with
such requirements and will, at its expense, forthwith upon the
request of the Owner Trustee or Lazard, deliver to the Owner
Trustee or Lazard a certificate, signed by the Company's
principal financial officer, stating (i) the Company's name,
address and telephone number (including area code), (ii) the
Company's Internal Revenue Service identification number, (iii)
the Company's Commission file number, (iv) the number of shares
of each class of capital stock outstanding as shown by the most
recent report or statement published by the Company, and (v)
whether the Company has filed the reports required to be filed
under the Exchange Act for a period of at least ninety (90) days
prior to the date of such certificate and in addition has filed
the most recent annual report required to be filed thereunder.
SECTION 10. MISCELLANEOUS
(a) Remedies. Each Holder, in addition to being
entitled to exercise all rights provided herein, and as provided
in the Sale Agreement and granted by law, including the recovery
of damages, shall be entitled to specific performance of such
Holder's rights under this Agreement. Except with respect to the
payment of Liquidated Damages in the event of the occurrence of
an Effectiveness Default, the Company agrees that monetary
damages would not be adequate compensation for any loss incurred
by reason of a breach by it of the provisions of this Agreement
and hereby agrees in any action for specific performance to waive
the defense that a remedy at law would be adequate.
(b) No Inconsistent Agreements. The Company has not
and shall not on or after the date of this Agreement enter into
any agreement with respect to its securities that is inconsistent
with the rights granted to the Holders in this Agreement or
otherwise conflicts with the provisions hereof. The rights
granted to the Holders hereunder do not and will not in any way
conflict with and are not and will not be inconsistent with the
rights granted to the holders of the Company's securities under
any other agreements. No holder of securities of the Company has
rights to the registration of any securities of the Company
because of the execution, delivery or performance by the Company
of this Agreement or as a result of the filing of the Shelf
Registration Statement.
(c) No Adverse Action Affecting the Transfer
Restricted Securities. The Company has not taken and will not
take, any action, or permit any change to occur with respect to
the Transfer Restricted Securities which would adversely affect
the ability of any of the Holders to include such Holder's
Transfer Restricted Securities in a registration undertaken
pursuant to this Agreement.
(d) 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 a majority of the outstanding principal amount of
16
Equity Notes assuming conversion thereof into Common Stock or, if
the Equity Notes have been converted into Common Stock, the
outstanding shares of Common Stock constituting Transfer
Restricted Securities, as the case may be. Notwithstanding the
foregoing, a waiver or consent to departure from the provisions
hereof that relates exclusively to the rights of Holders whose
Transfer Restricted Securities are being sold pursuant to the
Shelf Registration Statement and that does not directly or
indirectly affect the rights of other Holders may be given by the
Holders of a majority of the Transfer Restricted Securities being
sold.
(e) Notices. All notices and other communications
provided for or permitted hereunder shall be made in writing by
hand-delivery, first-class mail (registered or certified, return
receipt requested), telex, telecopier, or air courier
guaranteeing overnight deliver:
(i) if to a Holder, at the address set forth on
the records of the Company or the Registrar under the
Indenture, with a copy to the Registrar, and if to the
Owner Trustee or Lazard, at the address set forth in the
Sale Agreement; and
(ii) if to the Company, initially at its address
set forth in the Sale Agreement and thereafter at such
other address, notice of which is given in accordance with
the provisions of this Section.
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 on a business day (or otherwise on the first business day
following such answer back); when receipt acknowledged, if
telecopied on a business day (or otherwise on the first business
day following such acknowledgment); 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 under the Indenture at the address
specified in the Indenture.
(f) Successors and Assigns. This Agreement shall inure
to the benefit of and be binding upon and enforceable by the
successors and assigns of each of the parties, including without
limitation and without the need for an express assignment,
subsequent Holders.
(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 LAWS OF THE STATE OF NEW
YORK WITHOUT REGARD TO THE CONFLICT OF LAWS PRINCIPLES OF SUCH
STATE.
17
(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.
(k) Entire Agreement. This Agreement is intended by
the parties as a final expression of their agreement and intended
to be a complete and exclusive statement of the agreement and
understanding of the parties hereto in respect of the subject
matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or
referred to herein with respect to the registration rights
granted by the Company with respect to the securities sold
pursuant to the Sale Agreement, except as provided in the
Indenture and the Sale Agreement. Except as set forth in the
prior sentence, this Agreement supersedes all prior agreements
and understandings between the parties with respect to such
subject matter.
(l) Like Treatment of Holders. Neither the Company nor
any of its affiliates shall, directly or indirectly, pay or cause
to be paid any consideration (immediate or contingent), whether
by way of interest, fee, payment for the exchange of Transfer
Restricted Securities, or otherwise, to any Holder, for or as an
inducement to, or in connection with the solicitation of, any
vote, consent, waiver or amendment of any terms or provisions of
this Agreement, unless such consideration is required to be paid
to all Holders bound by such vote, consent, waiver or amendment
whether or not such Holders so consent, vote, waive or agree to
amend and whether or not such Holders tender their Transfer
Restricted Securities for redemption or conversion.
Notwithstanding the foregoing, the Company may pay or cause to be
paid consideration to any Holder in connection with any
transaction the purpose of which is not to induce or solicit any
vote, consent, waiver or amendment of any terms or provisions of
this Agreement.
18
IN WITNESS WHEREOF, the parties have executed this Agreement as
of the date first written above.
TRANS WORLD AIRLINES, INC.
By: /s/ Xxxxxxx X. Xxxxxx
----------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President and
Deputy Counsel
FIRST SECURITY BANK, NATIONAL
ASSOCIATION, not in its individual
capacity but as Owner Trustee
By: /s/ Arge Pavlos
----------------------
Name: Arge Pavlos
Title: Assistant Trust Officer
LAZARD FRERES & CO. LLC
By: /s/ Xxxxxxx X. Xxxx
----------------------
Name: Xxxxxxx X. Xxxx
Title: Managing Director
