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EXHIBIT 10.13
EXCHANGE AND REGISTRATION RIGHTS AGREEMENT
Dated as of December 4, 2000
among
Grant Prideco, Inc.,
The Guarantors from time to time party hereto, and
Xxxxxx Brothers Inc., on behalf of the Initial Purchasers
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EXCHANGE AND REGISTRATION RIGHTS AGREEMENT
This Exchange and Registration Rights Agreement (this
"Agreement") is made and entered into as of December 4, 2000 by and among Grant
Prideco, Inc., a Delaware corporation (the "Company"), the Guarantors (as
defined herein) and Xxxxxx Brothers Inc. on behalf of Deutsche Bank Securities
Inc., UBS Warburg LLC and Xxxxxxx & Company International (collectively, the
"Initial Purchasers").
This Agreement is made pursuant to the Purchase Agreement,
dated November 29, 2000 (the "Purchase Agreement"), by and among the Company,
the Existing Guarantors (as defined herein) and the Initial Purchasers, which
provides for the sale by the Company to the Initial Purchasers of $200,000,000
aggregate principal amount of the Company's 9 5/8% Senior Notes due 2007 (the
"Notes"). The Notes are, and the Exchange Notes (as defined herein) will be,
guaranteed on a senior basis by the Guarantors (as defined herein). In order to
induce the Initial Purchasers to purchase the Notes, the Company and the
Existing Guarantors have agreed to provide the registration rights set forth in
this Agreement. The execution and delivery of this Agreement is a condition to
the obligations of the Initial Purchasers set forth in Section 7 of the Purchase
Agreement.
The parties hereby agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement, the following capitalized terms
shall have the following meanings:
Additional Guarantor: Any subsidiary of the Company that
executes a Guarantee under the Indenture after the date of this Agreement.
Advice: As defined in Section 6(e) hereof.
Blackout Period: As defined in Section 5(a) hereof.
Blue Sky Application: As defined in Section 8(a) hereof.
Broker-Dealer: Any broker or dealer registered under the
Exchange Act.
Closing Date: The date of this Agreement.
Commission: The U.S. Securities and Exchange Commission.
Consummate: A Registered Exchange Offer shall be deemed
"Consummated" for purposes of this Agreement upon the occurrence of (i) the
filing and effectiveness under the Securities Act of the Exchange Offer
Registration Statement relating to the Exchange Notes to be issued in the
Exchange Offer, (ii) the maintenance of such Registration Statement continuously
effective and the keeping of the Exchange
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Offer open for a period not less than the minimum period required pursuant to
Section 3(b) hereof, and (iii) the delivery by the Company to the Registrar
under the Indenture of Exchange Notes in the same aggregate principal amount as
the aggregate principal amount of Notes that were tendered by Holders thereof
pursuant to the Exchange Offer.
Damages Payment Date: With respect to the Notes, each Interest
Payment Date.
Exchange Act: The U.S. Securities Exchange Act of 1934, as
amended.
Exchange Notes: The Company's 9 5/8% Senior Notes due 2007 to
be issued pursuant to the Indenture in the Exchange Offer, together with the
related Guarantees.
Exchange Offer: The registration by the Company under the
Securities Act of the Exchange Notes pursuant to a Registration Statement
pursuant to which the Company offers the Holders of all outstanding Transfer
Restricted Securities the opportunity to exchange all such outstanding Transfer
Restricted Securities held by such Holders for Exchange Notes in an aggregate
principal amount equal to the aggregate principal amount of the Transfer
Restricted Securities validly tendered in such exchange offer by such Holders.
Exchange Offer Registration Statement: The Registration
Statement relating to the Exchange Offer, including the related Prospectus.
Existing Guarantors: GP Expatriate Services, Inc.; Grant
Prideco Holding, LLC; Grant Prideco, L.P.; Grant Prideco USA, LLC; Star
Operating Company; TA Industries, Inc.; Texas Arai, Inc.; Tube-Alloy Capital
Corporation; Tube-Alloy Corporation; XL Systems International, Inc.; and XL
Systems, L.P.
Guarantee: Guarantees by the Guarantors of the Company's
obligations under the Notes, the Exchange Notes and the Indenture.
Guarantors: The Additional Guarantors and the Existing
Guarantors.
Holders: As defined in Section 2(b) hereof.
Indenture: The Indenture, dated as of the date hereof, among
the Company, the Existing Guarantors and United States Trust Company of New
York, as trustee (the "Trustee"), pursuant to which the Notes and the Exchange
Notes are to be issued, as such Indenture may be amended or supplemented from
time to time in accordance with the terms thereof.
Initial Purchasers: As defined in the preamble hereto.
Interest Payment Date: As defined in the Indenture and the
Notes.
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NASD: National Association of Securities Dealers, Inc.
Person: An individual, partnership, corporation, limited
liability company, unincorporated organization, association, joint-stock
company, trust, joint venture, government or any agency or political subdivision
thereof or any other entity.
Prospectus: The prospectus included in a Registration
Statement as amended or supplemented by any prospectus supplement and by all
other amendments thereto, including post-effective amendments, and all material
incorporated by reference into such Prospectus.
Record Holder: With respect to any Damages Payment Date
relating to Notes, each Person who is a Holder of Notes on the record date with
respect to the Interest Payment Date on which such Damages Payment Date shall
occur.
Registration Default: As defined in Section 5(a) hereof.
Registration Statement: Any Registration Statement of the
Company relating to (a) an offering of Exchange Notes pursuant to an Exchange
Offer or (b) the registration for resale of Transfer Restricted Securities
pursuant to the Shelf Registration Statement, which is filed pursuant to the
provisions of this Agreement, in each case including the Prospectus included
therein, all amendments and supplements thereto (including post-effective
amendments) and all exhibits and material incorporated by reference therein.
Securities Act: The U.S. Securities Act of 1933, as amended.
Shelf Filing Deadline: As defined in Section 4(a) hereof.
Shelf Registration Statement: As defined in Section 4(a)
hereof.
TIA: The U.S. Trust Indenture Act of 1939 (15 U.S.C. Section
77aaa-77bbbb) as in effect on the date of the Indenture.
Transfer Restricted Securities: Each Note or Exchange Note
(including the related Guarantees), as applicable, until the earliest to occur
of (a) the date on which such Note is exchanged by a person other than a
Broker-Dealer in the Exchange Offer in exchange for an Exchange Note, so long as
such person is not prohibited from reselling such Exchange Notes to the public
without delivering a prospectus and the Prospectus in the Exchange Offer
Registration Statement is not sufficient for such purpose, (b) following the
exchange by a Broker-Dealer in the Exchange Offer of a Note for an Exchange
Note, the date on which that Exchange Note is sold to a purchaser who receives
from that Broker-Dealer on or prior to the date of such sale a copy of the
Prospectus contained in the Exchange Offer Registration Statement, (c) the date
on which such Note or Exchange Note has been effectively registered under the
Securities Act and
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disposed of in accordance with a Shelf Registration Statement and (d) the date
on which such Note is sold by the Holder pursuant to Rule 144 under the
Securities Act.
Underwritten Registration or Underwritten Offering: A
registration in which securities of the Company are sold to an underwriter for
reoffering to the public.
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 Transfer Restricted Securities (each, a "Holder")
whenever such Person owns Transfer Restricted Securities.
SECTION 3. REGISTERED EXCHANGE OFFER
(a) Unless the Exchange Offer shall not be permissible under
applicable law or Commission policy (after the procedures set forth in Section
6(a) below have been complied with), the Company and the Guarantors shall use
(i) their reasonable best efforts to cause to be filed with the Commission as
soon as practicable after the Closing Date, but in no event later than 90 days
after the Closing Date, a Registration Statement under the Securities Act
relating to the Exchange Notes and the Exchange Offer, (ii) their reasonable
best efforts to cause such Registration Statement to be declared effective on or
prior to 180 days after the Closing Date, (iii) in connection with the
foregoing, file (A) all pre-effective amendments to such Registration Statement
as may be necessary in order to cause such Registration Statement to become
effective, (B) if applicable, a post-effective amendment to such Registration
Statement pursuant to Rule 430A under the Securities Act and (C) cause all
necessary filings in connection with the registration and qualification of the
Exchange Notes to be made under the blue sky laws of such jurisdictions as are
necessary to permit Consummation of the Exchange Offer and (iv) upon the
effectiveness of such Registration Statement, commence the Exchange Offer. The
Exchange Offer shall be on the appropriate form permitting registration of the
Exchange Notes to be offered in exchange for the Transfer Restricted Securities
and to permit resales of Exchange Notes held by Broker-Dealers as contemplated
by Section 3(c) below.
(b) The Company and the Guarantors shall use their reasonable
best efforts to cause the Exchange Offer Registration Statement to be effective
continuously and shall keep the Exchange Offer open for a period of not less
than the minimum period required under applicable U.S. Federal and state
securities laws to Consummate the Exchange Offer; provided, however, that in no
event shall such period be less than 20 business days. The Company and the
Guarantors shall cause the Exchange Offer to comply with all applicable U.S.
federal and state securities laws. No securities other than the Exchange Notes
and the Guarantees shall be included in the Exchange Offer Registration
Statement. The Company and the Guarantors shall use their reasonable best
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efforts to cause the Exchange Offer to be Consummated on the earliest
practicable date after the Exchange Offer Registration Statement has become
effective, but in any event on or prior to the 210th day after the Closing Date.
(c) The Company and the Guarantors shall indicate in a "Plan
of Distribution" section of the Prospectus contained in the Exchange Offer
Registration Statement that any Broker-Dealer who holds Notes that are Transfer
Restricted Securities and that were acquired for its own account as a result of
market-making activities or other trading activities (other than Transfer
Restricted Securities acquired directly from the Company), may exchange such
Notes pursuant to the Exchange Offer; however, such Broker-Dealer may be deemed
to be an "underwriter" within the meaning of the Securities Act and must,
therefore, deliver a Prospectus meeting the requirements of the Securities Act
in connection with any resales of the Exchange Notes received by such
Broker-Dealer in the Exchange Offer, which Prospectus delivery requirement may
be satisfied by the delivery by such Broker-Dealer of the Prospectus contained
in the Exchange Offer Registration Statement. Such "Plan of Distribution"
section shall also contain all other information with respect to such resales by
Broker-Dealers that the Commission may require in order to permit such resales
pursuant thereto, but such "Plan of Distribution" shall not name any such
Broker-Dealer or disclose the amount of Notes held by any such Broker-Dealer
except to the extent required by the Commission.
The Company and the Guarantors shall use their reasonable best
efforts to keep the Exchange Offer Registration Statement continuously
effective, supplemented and amended as required by the provisions of Section
6(c) below to the extent necessary to ensure that it is available for resales of
Exchange Notes acquired by Broker-Dealers for their own accounts as a result of
market-making activities or other trading activities, and to ensure that it
conforms with the requirements of this Agreement, the Securities Act and the
policies, rules and regulations of the Commission as announced from time to
time, for a period of at least 90 days after the Consummation of the Exchange
Offer.
The Company and the Guarantors shall provide sufficient copies
of the latest version of such Prospectus to Broker-Dealers promptly upon request
at any time during such 90-day period in order to facilitate such resales.
SECTION 4. SHELF REGISTRATION
(a) Shelf Registration. If (i) the Company and the Guarantors
are not required to file an Exchange Offer Registration Statement or to
Consummate the Exchange Offer because the Exchange Offer is not permitted by
applicable U.S. law or Commission policy (after the procedures set forth in
Section 6(a) below have been complied with) or (ii) if any Holder of Transfer
Restricted Securities shall notify the Company prior to the 20th day following
the Consummation of the Exchange Offer that such Holder (A) is prohibited by
applicable U.S. law or Commission policy from participating in the Exchange
Offer, (B) may not resell the Exchange Notes acquired by it in the Exchange
Offer to the public without delivering a prospectus and that the Prospectus
contained in the Exchange Offer Registration Statement is not appropriate or
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available for such resales by such Holder or (C) is a Broker-Dealer and holds
Notes acquired directly from the Company or one of its affiliates, then the
Company and the Guarantors shall:
(x) use their reasonable best efforts to cause to be
filed a Registration Statement pursuant to Rule 415 under the
Securities Act, which may be an amendment to the Exchange
Offer Registration Statement if permitted by the rules and
regulations of the Commission (in either event, the "Shelf
Registration Statement") on or prior to the earliest to occur
of (1) the 60th day after the date on which the Company
determine that they are not required to file the Exchange
Offer Registration Statement, or permitted to Consummate the
Exchange Offer and (2) the 60th day after the date on which
the Company receive notice from a Holder of Transfer
Restricted Securities as contemplated by clause (ii) of
paragraph (a) above (such earliest date being the "Shelf
Filing Deadline"), which Shelf Registration Statement shall
provide for resales of all Transfer Restricted Securities by
the Holders which shall have provided the information required
pursuant to Section 4(b) hereof; and
(y) use their reasonable best efforts to cause such
Shelf Registration Statement to be declared effective by the
Commission on or before the later of the 90th day after the
Shelf Filing Deadline and the 180th day after the Closing
Date.
Subject to Section 5(b), the Company and the Guarantors shall use their
reasonable best efforts to keep such Shelf Registration Statement continuously
effective, supplemented and amended as required by the provisions of Sections
6(b) and (c) hereof to the extent necessary to ensure that it is available for
resales of Notes or Exchange Notes by the Holders of Transfer Restricted
Securities entitled to the benefit of this Section 4(a), and to ensure that it
conforms with the requirements of this Agreement, the Securities Act and the
policies, rules and regulations of the Commission as announced from time to
time, for a period of at least two years following the Closing Date or such
shorter period that will terminate when all Notes or Exchange Notes covered by
the Shelf Registration Statement have been sold pursuant to the Shelf
Registration Statement.
(b) Provision by Holders of Certain Information in Connection
with the Shelf Registration Statement. No Holder of Transfer Restricted
Securities may include any of its Transfer Restricted Securities in any Shelf
Registration Statement pursuant to this Agreement unless and until such Holder
furnishes to the Company in writing, within 20 days after receipt of a request
therefor, such information as the Company may reasonably request for use in
connection with any Shelf Registration Statement or Prospectus or preliminary
Prospectus included therein. No Holder of Transfer Restricted Securities shall
be entitled to Additional Interest pursuant to Section 5 hereof unless and until
such Holder shall have used its reasonable best efforts to provide all such
reasonably requested information. 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
furnished to the Company by such Holder not materially misleading.
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SECTION 5. ADDITIONAL INTEREST
(a) If (i) any of the Registration Statements required by this
Agreement are not filed with the Commission on or prior to the date specified
for such filing in Sections 3(a) and 4(a), as applicable, (ii) any of such
required Registration Statements have not been declared effective by the
Commission on or prior to the date specified for such effectiveness in Sections
3(a) and 4(a), as applicable, (iii) the Exchange Offer has not been Consummated
within 210 days after the Closing Date, or longer if required by applicable U.S.
Federal and state securities laws, with respect to the Exchange Offer
Registration Statement or (iv) any Registration Statement required by this
Agreement is filed and declared effective but shall thereafter cease to be
effective or fail to be usable in connection with resales of Transfer Restricted
Securities without being succeeded immediately by a post-effective amendment to
such Registration Statement that cures such failure and that is itself
immediately declared effective (except as permitted in paragraph (b); such
period of time during which any such Registration Statement is not effective or
any such Registration Statement or the related Prospectus is not usable being
referred to as a "Blackout Period") (each such event referred to in clauses (i)
through (iv), a "Registration Default"), the Company and the Guarantors jointly
and severally agree to pay additional interest ("Additional Interest") to each
Holder of Transfer Restricted Securities adversely affected by such Registration
Default, in an amount equal to 0.25% per year of the principal amount of
Transfer Restricted Securities held by such Holder with respect to the first
90-day period immediately following the occurrence of such Registration Default.
The amount of Additional Interest shall increase by an additional 0.25% per year
of the principal amount of Transfer Restricted Securities with respect to each
subsequent 90-day period (or portion thereof) until all Registration Defaults
have been cured, up to a maximum amount of Additional Interest of 1.00% of the
principal amount of Transfer Restricted Securities. All accrued Additional
Interest shall be paid to Record Holders by the Company and the Guarantors in
the same manner as interest is paid under the Notes. Following the cure of all
Registration Defaults relating to any particular Transfer Restricted Securities,
the accrual of Additional Interest with respect to such Transfer Restricted
Securities will cease.
(b) A Registration Default referred to in Section 5(a)(iv)
shall be deemed not to have occurred and be continuing in relation to a
Registration Statement or the related Prospectus if (i) the Blackout Period has
occurred solely as a result of (x) the filing of a post-effective amendment to
such Shelf Registration Statement to incorporate annual audited financial
information with respect to the Company where such post-effective amendment is
not yet effective and needs to be declared effective to permit Holders to use
the related Prospectus or (y) the occurrence of other material events with
respect to the Company that would need to be described in such Registration
Statement or the related Prospectus and (ii) in the case of clause (y), the
Company is proceeding promptly and in good faith to amend or supplement
(including by way of filing documents under the Exchange Act which are
incorporated by reference into the Registration Statement) such Registration
Statement and the related Prospectus to describe such events; provided, however,
that in any case if such Blackout Period occurs
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for a continuous period in excess of 30 days, a Registration Default shall be
deemed to have occurred on the 31st day of such Blackout Period and Additional
Interest shall be payable in accordance with the above paragraph from the day
such Registration Default occurs until such Registration Default is cured or
until the Company is no longer required pursuant to this Agreement to keep such
Registration Statement effective or such Registration Statement or the related
Prospectus usable; provided, further, that in no event shall the total of all
Blackout Periods exceed 45 days in the aggregate of any 12-month period.
All payment obligations of the Company and the Guarantors set
forth in this section that 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 payment obligations with
respect to such security shall have been satisfied in full.
SECTION 6. REGISTRATION PROCEDURES
(a) Exchange Offer Registration Statement. In connection with
the Exchange Offer, the Company and the Guarantors shall comply with all of the
provisions of Section 6(c) below, shall use their reasonable best efforts to
effect such exchange to permit the sale of Transfer Restricted Securities being
sold in accordance with the intended method or methods of distribution thereof,
and shall comply with all of the following provisions:
(i) As a condition to its participation in the
Exchange Offer pursuant to the terms of this Agreement, each
Holder of Transfer Restricted Securities shall furnish, upon
the request of the Company, prior to the Consummation thereof,
a written representation to the Company and the Guarantors
(which may be contained in the letter of transmittal
contemplated by the Exchange Offer Registration Statement) to
the effect that (A) it is not an affiliate of the Company, (B)
it is not engaged in, and does not intend to engage in, and
has no arrangement or understanding with any Person to
participate in, a distribution of the Exchange Notes to be
issued in the Exchange Offer and (C) it is acquiring the
Exchange Notes in its ordinary course of business. In
addition, all such Holders of Transfer Restricted Securities
shall otherwise cooperate in the Company's and the Guarantors'
preparations for the Exchange Offer. Each Holder hereby
acknowledges and agrees that any Broker-Dealer and any such
Holder using the Exchange Offer to participate in a
distribution of the securities to be acquired in the Exchange
Offer (1) could not under Commission policy as in effect on
the date of this Agreement rely on the position of the
Commission enunciated in Exxon Capital Holdings Corporation
(available May 13, 1988) and Xxxxxx Xxxxxxx and Co., Inc.
(available June 5, 1991), as interpreted in the Commission's
letter to Shearman & Sterling dated July 2, 1993, and similar
no-action letters, and (2) must comply with the registration
and prospectus delivery requirements of the Securities Act in
connection with a secondary resale transaction and that such a
secondary resale transaction should be covered by an
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effective Registration Statement containing the selling
security holder information required by Item 507 or 508, as
applicable, of Regulation S-K if the resales are of Exchange
Notes obtained by such Holder in exchange for Notes acquired
by such Holder directly from the Company.
(ii) Prior to effectiveness of the Exchange Offer
Registration Statement, the Company and the Guarantors shall
state to the Commission that the Company and the Guarantors
are registering the Exchange Offer in reliance on the position
of the Commission enunciated in Exxon Capital Holdings
Corporation (available May 13, 1988) and Xxxxxx Xxxxxxx and
Co., Inc. (available June 5, 1991) and shall represent to the
Commission that neither the Company nor any Guarantor has
entered into any arrangement or understanding with any Person
to distribute the Exchange Notes to be received in the
Exchange Offer and that, to the best of the Company's and each
Guarantor's information and belief, each Holder participating
in the Exchange Offer is acquiring the Exchange Notes in its
ordinary course of business and has no arrangement or
understanding with any Person to participate in the
distribution of the Exchange Notes received in the Exchange
Offer; and
(iii) shall issue, upon the request of any Holder of
Notes covered by the Exchange Offer, Exchange Notes, having an
aggregate principal amount equal to the aggregate principal
amount of Notes surrendered to the Company by such Holder in
exchange therefor or being sold by such Holder; such Exchange
Notes to be registered in the name of such Holder or in the
name of the purchaser(s) of such Exchange Notes, as the case
may be; in return, the Notes held by such Holder shall be
surrendered to the Company for cancellation.
(b) Shelf Registration Statement. In connection with the Shelf
Registration Statement, the Company and the Guarantors shall comply with all the
provisions of Section 6(c) below and shall use their 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 thereof, and pursuant thereto the Company and the Guarantors will
as expeditiously as possible prepare and file with the Commission a Registration
Statement relating to the registration on any appropriate form under the
Securities Act, which form shall be available for the sale of the Transfer
Restricted Securities in accordance with the intended method or methods of
distribution thereof.
(c) General Provisions. In connection with any Registration
Statement and any Prospectus required by this Agreement to permit the sale or
resale of Transfer Restricted Securities (including, without limitation, any
Registration Statement and the related Prospectus required to permit resales of
Notes and Exchange Notes by Broker-Dealers), the Company and the Guarantors
shall:
(i) use their reasonable best efforts to keep such
Registration Statement continuously effective and provide all
requisite financial statements
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(including, if required by the Securities Act or any
regulation thereunder, financial statements of any Guarantors)
for the period specified in Sections 3 or 4 of this Agreement,
as applicable; upon the occurrence of any event that would
cause any such Registration Statement or the Prospectus
contained therein (A) to contain a material misstatement or
omission or (B) not to be effective and usable for resale of
Transfer Restricted Securities during the period required by
this Agreement, the Company and the Guarantors shall file
promptly an appropriate amendment to such Registration
Statement, in the case of clause (A), correcting any such
misstatement or omission, and, in the case of either clause
(A) or (B), use their reasonable best efforts to cause such
amendment to be declared effective and such Registration
Statement and the related Prospectus to become usable for
their intended purpose(s) as soon as practicable thereafter.
Notwithstanding the foregoing, the Company and the Guarantors
may allow the Shelf Registration Statement to cease to become
effective and usable if (x) the board of directors of the
Company determines in good faith that it is in the best
interests of the Company not to disclose the existence of or
facts surrounding any proposed or pending material corporate
transaction involving the Company or the Guarantors, and the
Company notifies the Holders within two business days after
such boards of directors make such determination or (y) the
Prospectus contained in the Shelf Registration Statement
contains an untrue statement of a material fact or omits to
state a material fact necessary in order to make the
statements made therein, in the light of the circumstances
under which they were made, not misleading; provided that the
two-year period referred to in Section 4(a) hereof during
which the Shelf Registration Statement is required to be
effective and usable shall be extended by the number of days
during which such Registration Statement was not effective or
usable pursuant to the foregoing provisions; and provided
further that Additional Interest shall accrue on the Notes as
provided in Section 5 hereof;
(ii) prepare and file with the Commission such
amendments and post-effective amendments to the Registration
Statement as may be necessary to keep the Registration
Statement effective for the applicable period set forth in
Sections 3 or 4 hereof, as applicable; cause the Prospectus to
be supplemented by any required Prospectus supplement, and as
so supplemented to be filed pursuant to Rule 424 under the
Securities Act, and to comply fully with the applicable
provisions of Rules 424 and 430A under the Securities Act in a
timely manner; and comply with the provisions of the
Securities Act with respect to the disposition of all
securities covered by such Registration Statement during the
applicable period in accordance with the intended method or
methods of distribution by the sellers thereof set forth in
such Registration Statement or supplement to the Prospectus;
(iii) cooperate with the selling Holders of Transfer
Restricted Securities and the underwriter(s), if any, 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
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to be in such denominations and registered in such names as
the Holders or the underwriter(s), if any, may request at
least two business days prior to any sale of Transfer
Restricted Securities made by such underwriter(s);
(iv) use their reasonable best efforts to cause the
Transfer Restricted Securities covered by the 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 or the underwriter(s), if
any, to consummate the disposition of such Transfer Restricted
Securities, subject to the proviso contained in clause (c)(ix)
below;
(v) if any fact or event contemplated by clause
(d)(i)(D) below shall exist or have occurred, prepare a
supplement or post-effective amendment to the 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 made therein,
in the light of the circumstances under which they were made,
not misleading;
(vi) provide a CUSIP, CINS or ISIN number, as
applicable, for all Transfer Restricted Securities not later
than the effective date of the Registration Statement and
provide the Trustee under the Indenture with printed
certificates for the Transfer Restricted Securities which are
in a form eligible for deposit with the depositary;
(vii) cooperate and assist in any filings required to
be made with the NASD and in the performance of any due
diligence investigation by any underwriter (including any
"qualified independent underwriter") that is required to be
retained in accordance with the rules and regulations of the
NASD;
(viii) otherwise use their best efforts to comply
with all applicable rules and regulations of the Commission,
and make generally available to its security holders, as soon
as practicable, a consolidated earnings statement meeting the
requirements of Rule 158 (which need not be audited) for the
twelve-month period (A) commencing at the end of any fiscal
quarter in which Transfer Restricted Securities are sold to
underwriters in a firm or best efforts Underwritten Offering
or (B) if not sold to underwriters in such an offering,
beginning with the first month of the Company's first fiscal
quarter commencing after the effective date of the
Registration Statement;
(ix) cause the Indenture to be qualified under the
TIA not later than the effective date of the first
Registration Statement required by this Agreement, and, in
connection therewith, cooperate with the Trustee and the
Holders of Notes and Exchange Notes to effect such changes to
the Indenture as may be required for such Indenture to be so
qualified in accordance with the terms
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of the TIA; and execute, and use their best efforts to cause
the Trustee to execute, all documents that may be required to
effect such changes and all other forms and documents required
to be filed with the Commission to enable such Indenture to be
so qualified in a timely manner; and
(x) provide promptly to any Holder upon such Holder's
written request each document filed with the Commission
pursuant to the requirements of Section 13 and Section 15 of
the Exchange Act.
(d) Additional Provisions Applicable to Shelf Registration
Statements. In connection with each Shelf Registration Statement the Company and
the Guarantors shall:
(i) advise the underwriter(s), if any, and selling
Holders of Transfer Restricted Securities promptly and, if
requested by such Persons, to confirm such advice in writing,
(A) 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, (B) 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, (C)
of the issuance by the Commission of any stop order suspending
the effectiveness of the Registration Statement under the
Securities Act, of the suspension by any state securities
commission of the qualification of the Transfer Restricted
Securities for offering or sale in any jurisdiction or of the
initiation of any proceeding for any of the preceding purposes
and (D) of the existence of any fact or the happening of any
event that requires the making of any additions to or changes
in the Shelf Registration Statement or the Prospectus in order
that the Shelf Registration Statement and the Prospectus do
not contain an untrue statement of a material fact or omit to
state a material fact necessary to make the statements made
therein, in the light of the circumstances under which they
were made, not misleading. If at any time the Commission shall
issue any stop order suspending the effectiveness of the Shelf
Registration Statement, or any U.S. state securities
commission or other regulatory authority shall issue an order
suspending the qualification or exemption from qualification
of the Transfer Restricted Securities under U.S. state
securities or blue sky laws, the Company and the Guarantors
shall use their reasonable best efforts to obtain the
withdrawal or lifting of such order at the earliest possible
time;
(ii) if requested in writing, furnish to each of the
selling Holders of Transfer Restricted Securities and each of
the underwriter(s), if any, before filing with the Commission,
copies of any Shelf Registration Statement or any Prospectus
included therein or any amendments or supplements to any such
Shelf Registration Statement or Prospectus (including all
documents incorporated by reference after the initial filing
of such Shelf Registration Statement), which documents will be
subject to the review of such Holders and underwriter(s), if
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any, for a period of at least five business days, and the
Company and the Guarantors will not file any such Shelf
Registration Statement or Prospectus or any amendment or
supplement to any such Shelf Registration Statement or
Prospectus (including all such documents incorporated by
reference) if a selling Holder of Transfer Restricted
Securities covered by such Shelf Registration Statement or the
underwriter(s), if any, shall not have had an opportunity to
participate in the preparation thereof; such Holders and
underwriter(s) shall be deemed to have reasonably objected to
such filing if such Shelf Registration Statement, amendment,
Prospectus or supplement, as applicable, as proposed to be
filed, contains an untrue statement of a material fact or
omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under
which they were made, not misleading, or fails to comply with
the applicable requirements of the Securities Act;
(iii) promptly prior to the filing of any document
that is to be incorporated by reference into a Shelf
Registration Statement or Prospectus, provide copies of such
document to the selling Holders and to the underwriter(s), if
any, make the Company's and the Guarantors' representatives
available for discussion of such document and other customary
due diligence matters, and include such information in such
document prior to the filing thereof as such selling Holders
or underwriter(s), if any, reasonably may request;
(iv) make available for inspection at reasonable
times at each of the Company's principal place of business by
the Holders of Transfer Restricted Securities, any underwriter
participating in any disposition pursuant to such Shelf
Registration Statement, and any attorney or accountant
retained by such selling Holders or any of the underwriter(s)
who shall certify to the Company and the Guarantors that they
have a current intention to sell Transfer Restricted
Securities pursuant to a Shelf Registration Statement, and,
such relevant financial and other records, pertinent corporate
documents and properties of the Company and the Guarantors as
reasonably requested and cause the Company's and the
Guarantors' officers, directors and employees to respond to
such inquiries as shall be reasonably necessary, in the
reasonable judgment of counsel to such Holders, to conduct a
reasonable investigation; provided, however, that the
foregoing inspection and information gathering shall be
coordinated on behalf of the selling Holders by one counsel
designated by and on behalf of such Holders and, provided,
further, that each such party shall be required to maintain in
confidence and not disclose to any other Person any
information or records reasonably designated by the Company in
writing as being confidential, until such time as (A) such
information becomes a matter of public record (whether by
virtue of its inclusion in such Shelf Registration Statement
or otherwise), (B) such Person shall be required so to
disclose such information pursuant to a subpoena or order of
any court or other governmental agency or body having
jurisdiction over the matter (subject to the requirements of
such order, and only after such Person shall have given the
Company prompt prior written notice of such requirement) or
(C)
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such information is required to be set forth in such Shelf
Registration Statement or the Prospectus included therein or
in an amendment to such Shelf Registration Statement or an
amendment or supplement to such Prospectus in order that such
Shelf Registration Statement, Prospectus, amendment or
supplement, as the case may be, does not contain an untrue
statement of a material fact or omit to state therein a
material fact required to be stated therein or necessary to
make the statements made therein not misleading;
(v) if requested by any selling Holders of Transfer
Restricted Securities or the underwriter(s), if any, promptly
incorporate in any Shelf Registration Statement or Prospectus
pursuant to a supplement or post-effective amendment if
necessary, such information as such selling Holders and
underwriter(s), if any, may reasonably request to have
included therein, including, without limitation, information
relating to the "Plan of Distribution" of the Transfer
Restricted Securities information with respect to the
principal amount of Transfer Restricted Securities being sold
to such underwriter(s), the purchase price being paid therefor
and any other terms of the offering of the Transfer Restricted
Securities to be sold in such offering; and make all required
filings of such Prospectus supplement or post-effective
amendment as soon as practicable after the Company are
notified of the matters to be incorporated in such Prospectus
supplement or post-effective amendment; provided, however,
that the Company shall not be required to take any action
pursuant to this Section 6(d)(v) that would, in the opinion of
counsel for the Company reasonably satisfactory to the Initial
Purchasers, violate applicable law;
(vi) deliver to each selling Holder of Transfer
Restricted Securities and each of the underwriter(s), if any,
without charge, as many copies of the Prospectus (including
each preliminary Prospectus) and any amendment or supplement
thereto as such Persons reasonably may request; the Company
and the Guarantors hereby consent to the use of the Prospectus
and any amendment or supplement thereto by each of the selling
Holders and each of the underwriter(s), if any, in connection
with the offering and the sale of the Transfer Restricted
Securities covered by the Prospectus or any amendment or
supplement thereto;
(vii) furnish to each Holder whose Transfer
Restricted Securities have been included in a Shelf
Registration Statement in connection with such exchange or
sale, without charge, at least one copy of the 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);
(viii) enter into an underwriting agreement on not
more than one occasion in the case of an offering pursuant to
a Shelf Registration, and make such representations and
warranties, and take all such other actions in connection
therewith in order to expedite or facilitate the disposition
of the Transfer Restricted Securities pursuant to any
Registration Statement contemplated by this
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Agreement, all to such extent as may be reasonably requested
by any Holder or Holders of Transfer Restricted Securities who
hold at least 25% in aggregate principal amount of such class
of Transfer Restricted Securities; provided that the Company
and the Guarantors shall not be required to enter into any
such agreement more than once with respect to all of the
Transfer Restricted Securities and may delay entering into
such agreement if the board of directors of each of the
Company determines in good faith that it is in the best
interests of the Company and the Guarantors not to disclose
the existence of or facts surrounding any proposed or pending
material corporate transaction involving the Company and the
Guarantors; and whether or not an underwriting agreement is
entered into and whether or not the registration is an
Underwritten Registration, the Company and the Guarantors
shall:
(A) furnish to the Initial Purchasers, the Holders of
Transfer Restricted Securities who hold at least 25% in
aggregate principal amount of such class of Transfer
Restricted Securities and each underwriter, if any, in such
substance and scope as they may reasonably request and as are
customarily made in connection with an offering of debt
securities pursuant to a Shelf Registration Statement (i) upon
the effective date of the Shelf Registration Statement (and if
such Shelf Registration Statement contemplates an Underwritten
Offering of Transfer Restricted Securities upon the date of
the closing under the underwriting agreement related thereto)
and (ii) upon the filing of any amendment or supplement to the
Shelf Registration Statement or any other document that is
incorporated in the Shelf Registration Statement by reference
and includes financial data with respect to a fiscal quarter
or year:
(1) a certificate, dated the date of
effectiveness of the Shelf Registration Statement
signed by (y) the respective chief executive officer,
the respective President or any Vice President and
(z) the respective chief financial officer of each of
the Company and each of the Guarantors confirming, as
of the date thereof, the matters set forth in Section
7(e) of the Purchase Agreement and such other matters
as such parties may reasonably request;
(2) an opinion, dated the date of
effectiveness of such Shelf Registration Statement,
of securities counsel for the Company covering
matters similar to those set forth in Sections 7(d),
7(e) and 7(f) of the Purchase Agreement and such
other matters as such parties may reasonably request,
and in any event including a statement to the effect
that such counsel has participated in conferences
with officers and other representatives of the
Company, representatives of the independent public
accountants for the Company, the Initial Purchasers'
representatives and the Initial Purchasers' counsel
in connection with the preparation of such Shelf
Registration Statement and the related Prospectus
although such counsel has not independently verified
the accuracy, completeness or fairness of such
statements in such Shelf Registration Statement; and
that
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such counsel advises that, on the basis of the
foregoing, such counsel's work in connection with
this work did not disclose information that gave such
counsel reason to believe that the Shelf Registration
Statement, at the time such Shelf Registration
Statement or any post-effective amendment thereto
became effective contained an untrue statement of a
material fact or omitted to state a material fact
required to be stated therein or necessary to make
the statements therein not misleading, or that the
Prospectus contained in such Shelf Registration
Statement as of its date contained an untrue
statement of a material fact or omitted to state a
material fact necessary in order to make the
statements made therein, in the light of the
circumstances under which they were made, not
misleading. Such counsel may state further that such
counsel assumes no responsibility for, and has not
independently verified, the accuracy, completeness or
fairness of the financial statements, notes and
schedules and other financial data included or
incorporated by reference in the Shelf Registration
Statement contemplated by this Agreement or the
related Prospectus; and
(3) a customary comfort letter, dated as of
the date of effectiveness of the Shelf Registration
Statement from the Company's independent accountants,
in the customary form and covering matters of the
type customarily covered in comfort letters by
underwriters in connection with primary underwritten
offerings, and affirming the matters set forth in the
comfort letters delivered pursuant to Sections 7(l)
and 7(m) of the Purchase Agreement;
(B) set forth in full or incorporated by reference in
the underwriting agreement, if any, the indemnification
provisions and procedures of Section 8 hereof with respect to
all parties to be indemnified pursuant to said Section; and
(C) deliver such other documents and certificates as
may be reasonably requested by such parties to evidence
compliance with clause (A) above and with any customary
conditions contained in the underwriting agreement or other
agreement entered into by the Company and the Guarantors
pursuant to this clause (viii), if any.
If at any time the representations and warranties of the Company or the
Guarantors contemplated in clause (A)(1) above cease to be true and correct, the
Company or the Guarantors shall so advise the Initial Purchasers and the
underwriters, if any, and each selling Holder promptly and, if requested by such
Persons, shall confirm such advice in writing; and
(ix) prior to any public offering of Transfer
Restricted Securities cooperate with the selling Holders of
Transfer Restricted Securities the underwriter(s), if any, and
their respective counsel in connection with the registration
and qualification of the Transfer Restricted Securities under
the
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securities or blue sky laws of such jurisdictions as the
selling Holders of Transfer Restricted Securities or
underwriter(s) 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 filed
pursuant to Section 4 hereof; provided, however, that the
Company and the Guarantors shall not be obligated to qualify
as a foreign corporation in any jurisdiction in which it is
not now so qualified or to take any action that would subject
it to general consent to service of process, other than as to
matters and transactions relating to the Shelf Registration
Statement, in any jurisdiction where it is not now so subject.
(e) Each Holder agrees by acquisition of a Transfer Restricted
Security that, upon receipt of any notice from the Company of the existence of
any fact of the kind described in Section 6(d)(i) 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 supplemented or amended Prospectus contemplated by Section 6(d)(vi) 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 that are incorporated by reference in the Prospectus. If so
directed by the Company, each Holder will 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 that was current at the time of receipt of such notice. In the event
the Company shall give any such notice, the time period regarding the
effectiveness of such Shelf Registration Statement set forth in Section 4
hereof, as applicable, shall be extended by the number of days during the period
from and including the date of the giving of such notice pursuant to Section
6(d)(i) hereof to and including the date when each selling Holder covered by
such Shelf Registration Statement shall have received the copies of the
supplemented or amended Prospectus contemplated by Section 6(d)(vi) hereof or
shall have received the Advice.
(f) The Company and the Guarantors may require each Holder of
Transfer Restricted Securities as to which any registration is being effected to
furnish to the Company such information regarding such Holder and such Holder's
intended method of distribution of the applicable Transfer Restricted Securities
as the Company may from time to time reasonably request in writing, but only to
the extent that such information is required in order to comply with the
Securities Act. Each such Holder agrees to notify the Company as promptly as
practicable of (i) any inaccuracy or change in information previously furnished
by such Holder to the Company or (ii) the occurrence of any event, in either
case, as a result of which any Prospectus relating to such registration contains
or would contain an untrue statement of a material fact regarding such Holder or
such Holder's intended method of distribution of the applicable Transfer
Restricted Securities or omits to state any material fact regarding such Holder
or such Holder's intended method of distribution of the applicable Transfer
Restricted Securities required to be stated therein or necessary to make the
statements made therein, in the
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light of the circumstances under which they were made, not misleading and
promptly to furnish to the Company any additional information required to
correct and update any previously furnished information or required so that such
Prospectus shall not contain, with respect to such Holder or the distribution of
the applicable Transfer Restricted Securities an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein not misleading.
SECTION 7. REGISTRATION EXPENSES
(a) All expenses incident to the Company's and the Guarantors'
performance of or compliance with this Agreement will be borne by the Company
regardless of whether a Registration Statement becomes effective, including
without limitation and as applicable: (i) all Commission, securities exchange or
NASD registration and filing fees and expenses (including filings made by any
Initial Purchasers or Holder with the NASD (and, if applicable, the fees and
expenses of any "qualified independent underwriter" and its counsel that may be
required by the rules and regulations of the NASD)); (ii) all fees and expenses
of compliance with U.S. federal securities and state blue sky or securities laws
and compliance with the rules of the NASD (including reasonable fees and
disbursements of one counsel for Holders in connection with blue sky and/or NASD
qualification of the Exchange Notes); (iii) all expenses of printing (including
printing certificates for the Exchange Notes to be issued in the Exchange Offer
and printing of Prospectuses), messenger and delivery services; (iv) all fees
and disbursements of counsel for the Company and the Guarantors; (v) all fees
and disbursements of independent certified public accountants of the Company
(including the expenses of any special audit and comfort letters required by or
incident to such performance) and (vi) the reasonable fees and disbursements of
one firm of counsel designated by the Holders of a majority in principal amount
of Transfer Restricted Securities covered by the Shelf Registration Statement to
act as counsel for the Holders of those Transfer Restricted Securities in
connection therewith.
The Company will, in any event, bear their and the Guarantors'
internal expenses (including, without limitation, all salaries and expenses of
its officers and employees performing legal or accounting duties), the expenses
of any annual audit and the fees and expenses of any Person, including special
experts, retained by the Company or the Guarantors.
(b) Each Holder of Transfer Restricted Securities will pay all
underwriting discounts, if any, and commissions and transfer taxes, if any,
relating to the disposition of such Holder's Transfer Restricted Securities.
SECTION 8. INDEMNIFICATION
(a) The Company and each Guarantor shall, jointly and
severally, indemnify and hold harmless each Holder of Transfer Restricted
Securities, its officers and employees and each Person, if any, who controls any
such Holders, within the meaning of the Securities Act, from and against any
loss, claim, damage or liability, joint
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or several, or any action in respect thereof (including, but not limited to, any
loss, claim, damage, liability or action relating to purchases, sales and
registration of the Notes, the Guarantees and the Exchange Notes), to which that
Holder, officer, employee or controlling Person may become subject, under the
Securities Act or otherwise, insofar as such loss, claim, damage, liability or
action arises out of, or is based upon (i) any untrue statement or alleged
untrue statement of a material fact contained (A) in any Registration Statement
or preliminary Prospectus or Prospectus or in any amendment or supplement
thereto, (B) in any blue sky application or other document prepared or executed
by any Company or any Guarantor (or based upon any written information furnished
by any Company or any Guarantor) specifically for the purpose of qualifying any
or all of the Notes under the securities laws of any state or other jurisdiction
(any such application, document or information being hereinafter called a "Blue
Sky Application") or (C) in any materials or information provided to investors
by, or with the approval of, the Company in connection with the marketing of the
offering of the Exchange Notes ("Marketing Materials"), including any roadshow
or investor presentations made to investors by the Company (whether in person or
electronically); (ii) the omission or alleged omission to state in any
Registration Statement, preliminary Prospectus or Prospectus, or in any
amendment or supplement thereto, or in any Blue Sky Application or Marketing
Materials any material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, or (iii) any act or failure to act or any alleged act or failure to act by
any Holder of Transfer Restricted Securities in connection with, or relating in
any manner to, the Notes, the Guarantees or the Exchange Notes or the offering
contemplated by any Registration Statement, and which is included as part of or
referred to in any loss, claim, damage, liability or action arising out of or
based upon matters covered by clause (i) or (ii) above (provided that the
Company and the Guarantors shall not be liable under this clause (iii) to the
extent that it is determined in a final judgment by a court of competent
jurisdiction that such loss, claim, damage, liability or action resulted
directly from any such acts or failures to act undertaken or omitted to be taken
by such Holder through its gross negligence or willful misconduct); and shall
reimburse each Holder and each such officer, employee or controlling Person
promptly upon demand for any legal or other expenses reasonably incurred by that
Holder, officer, employee or controlling Person in connection with investigating
or defending or preparing to defend against any such loss, claim, damage,
liability or action as such expenses are incurred; provided, however, that the
Company and the Guarantors shall not be liable in any such case to the extent
that any such loss, claim, damage, liability or action arises out of, or is
based upon, any untrue statement or alleged untrue statement or omission or
alleged omission made in any Registration Statement, preliminary Prospectus or
Prospectus, or in any such amendment or supplement, or in any Blue Sky
Application or Marketing Materials, in reliance upon and in conformity with
written information concerning such Holder furnished to the Company by or on
behalf of any Holder specifically for inclusion therein; provided, further, that
with respect to any such untrue statement or omission made in any preliminary
Prospectus, the indemnity agreement contained in this Section 8(a) shall not
inure to the benefit of the Holder from whom the Person asserting any such
losses, claims, damages or liabilities purchased the Notes, Guarantees or
Exchange Notes
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concerned if, to the extent that such sale was a sale by the Holder and any such
loss, claim, damage or liability of such Holder is a result of the fact that
both (A) a copy of the Prospectus (or the Prospectus as then amended or
supplemented) was not sent or given to such Person at or prior to written
confirmation of the sale of such Notes or Exchange Notes to such Person and (B)
the untrue statement or omission in the preliminary Prospectus was corrected in
the Prospectus (or the Prospectus as then amended or supplemented) unless such
failure to deliver the Prospectus was a result of noncompliance by the Company
with Section 6(d)(vi) hereof. The foregoing indemnity agreement is in addition
to any liability which the Company and the Guarantors may otherwise have to any
Holder or to any officer, employee or controlling Person of that Holder.
(b) Each Holder, severally and not jointly, shall indemnify
and hold harmless each of the Company, each of the Guarantors, their respective
directors, officers and employees, and each Person, if any, who controls either
of the Company or any of the Guarantors within the meaning of the Securities
Act, from and against any loss, claim, damage or liability, joint or several, or
any action in respect thereof, to which the Company, the Guarantors or any such
director, officer or controlling Person may become subject, under the Securities
Act or otherwise, insofar as such loss, claim, damage, liability or action
arises out of, or is based upon (i) any untrue statement or alleged untrue
statement of a material fact contained (A) in any Registration Statement,
preliminary Prospectus or Prospectus, or in any amendment or supplement thereto
or (B) in any Blue Sky Application or (ii) the omission or alleged omission to
state in any Registration Statement, preliminary Prospectus or Prospectus, or in
any amendment or supplement thereto, or in any Blue Sky Application any material
fact required to be stated therein or necessary to make the statements therein
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 concerning such Holders
furnished to the Company by or on behalf of that Holder specifically for
inclusion therein, which information consists of the information specified in
Section 8(e) of the Purchase Agreement, and shall reimburse each of the Company,
each of the Guarantors and each such director, officer, employee and controlling
Person for any legal or other expenses reasonably incurred by such Company, such
Guarantor or each such director, officer, employee or controlling Person in
connection with investigating or defending or preparing to defend against any
such loss, claim, damage, liability or action as such expenses are incurred. The
foregoing indemnity agreement is in addition to any liability which any Holder
may otherwise have to either of the Company, any of the Guarantors or any such
director, officer, employee or controlling Person.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under this Section 8, notify the indemnifying party in
writing of the claim or the commencement of that action; provided, however, that
the failure to notify the indemnifying party shall not
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relieve it from any liability which it may have under this Section 8 except to
the extent it has been materially prejudiced by such failure and; provided,
further, that the failure to notify the indemnifying party shall not relieve it
from any liability which it may have to an indemnified party otherwise than
under this Section 8. If any such claim or action shall be brought against an
indemnified party, and it shall notify the indemnifying party thereof, the
indemnifying party shall be entitled to participate therein and, to the extent
that it wishes, jointly with any other similarly notified indemnifying party, to
assume the defense thereof with counsel reasonably satisfactory to the
indemnified party. After notice from the indemnifying party to the indemnified
party of its election to assume the defense of such claim or action, the
indemnifying party shall not be liable to the indemnified party under this
Section 8 for any legal or other expenses subsequently incurred by the
indemnified party in connection with the defense thereof other than reasonable
costs of investigation; provided, however, any indemnified party shall have the
right to employ separate counsel in any such action and to participate in the
defense thereof but the fees and expenses of such counsel shall be at the
expense of the indemnified party unless (i) the employment of such counsel has
been specifically authorized by the indemnifying party in writing, or (ii) such
indemnified party shall have been advised by such counsel that there may be one
or more legal defenses available to it which are different from or additional to
those available to the indemnifying party and in the reasonable judgment of such
counsel it is advisable for such indemnified party to employ separate counsel or
(iii) the indemnifying party has failed to assume the defense of such action and
employ counsel reasonably satisfactory to the indemnified party, in which case,
if such indemnified party notifies the indemnifying party in writing that it
elects to employ separate counsel at the expense of the indemnifying party, the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to one local counsel) at any time for all such indemnified parties,
which firm shall be designated in writing by (x) Xxxxxx Brothers Inc. if the
indemnified parties under this Section 8 consist of the Initial Purchasers or
any of their respective officers, employees or controlling Persons or (y) by the
Company, if the indemnified parties under this Section 8 consist of any of the
Company, any of the Guarantors or any of their respective directors, officers,
employees or controlling Persons. No indemnifying party shall (i) without the
prior written consent of the indemnified parties (which consent shall not be
unreasonably withheld), settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding or (ii) be liable for any
settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with the consent of
the indemnifying party or if there be a final judgment of the plaintiff in any
such action, the indemnifying party agrees
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to indemnify and hold harmless any indemnified party from and against any loss
or liability by reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 8
shall for any reason be unavailable to or insufficient to hold harmless an
indemnified party under Section 8(a) or 8(b) in respect of any loss, claim,
damage or liability, or any action in respect thereof, referred to therein, then
each indemnifying party shall, in lieu of indemnifying such indemnified party,
contribute to the amount paid or payable by such indemnified party as a result
of such loss, claim, damage or liability, or action in respect thereof, (i) in
such proportion as shall be appropriate to reflect the relative benefits
received by the Company and the Guarantors, on the one hand, and the Holders on
the other, from the sale of the Transfer Restricted Securities or (ii) if the
allocation provided by clause (i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the Company and
the Guarantors, on the one hand and the Holders on the other with respect to the
statements or omissions which resulted in such loss, claim, damage or liability,
or action in respect thereof, as well as any other relevant equitable
considerations. The relative fault shall be determined by reference to 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
or any of the Guarantors, on the one hand, or the Holders, on the other hand,
the intent of the parties and their relative knowledge, access to information
and opportunity to correct or prevent such statement or omission. The Company,
the Guarantors and the Holders 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 (even if the Holders were treated as one entity for such purpose) 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 loss, claim, damage or liability, or action in respect
thereof, referred to above in this Section shall be deemed to include, for
purposes of this Section 8(d), 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 8(d), no Holder
shall be required to contribute any amount in excess of the amount by which the
net proceeds received by it in connection with its sale of Notes exceeds the
amount of any damages which such Holder has otherwise paid or become liable to
pay by reason of the untrue or alleged untrue statement or omission or alleged
omission. No Person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any Person who was not guilty of such fraudulent misrepresentation. The Holders'
obligations to contribute as provided in this Section 8(d) are several and not
joint.
SECTION 9. RULE 144A
The Company and each Guarantor hereby agrees with each Holder
of Transfer Restricted Securities, during any period in which the Company or
such Guarantor is not subject to Section 13 or 15(d) of the Exchange Act within
the two-year period following the Closing Date, to make available to any Holder
or beneficial owner
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of Transfer Restricted Securities, in connection with any sale thereof and any
prospective purchaser of such Transfer Restricted Securities from such Holder or
beneficial owner, the information required by Rule 144A(d)(4) under the
Securities Act in order to permit resales of such Transfer Restricted Securities
pursuant to Rule 144A.
SECTION 10. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS
No Holder may participate in any Underwritten Registration
hereunder unless such Holder (a) agrees to sell such Holder's Transfer
Restricted Securities on the basis provided in any underwriting arrangements
approved by the Persons entitled hereunder to approve such arrangements and (b)
completes and executes all reasonable questionnaires, powers of attorney,
indemnities, underwriting agreements, lock-up letters and other documents
required under the terms of such underwriting arrangements.
SECTION 11. SELECTION OF UNDERWRITERS
Subject to Section 6(d)(i), the Holders of Transfer Restricted
Securities covered by the Shelf Registration Statement who desire to do so may
sell such Transfer Restricted Securities in an Underwritten Offering at such
Holders' expense. In any such Underwritten Offering, the investment banker or
investment bankers and manager or managers that will administer the offering
will be selected by the Holders of a majority in aggregate principal amount of
the Transfer Restricted Securities included in such offering; provided that such
investment bankers and managers must be reasonably satisfactory to the Company.
SECTION 12. MISCELLANEOUS
(a) Remedies. The Company and the Guarantors agree that
monetary damages (including Additional Interest) would not be adequate
compensation for any loss incurred by reason of a breach by it of the provisions
of this Agreement and hereby agree to waive the defense in any action for
specific performance that a remedy at law would be adequate.
(b) No Inconsistent Agreements. Neither the Company nor any
Guarantor will, 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.
Except as disclosed in the Offering Memorandum (as such term is defined in the
Purchase Agreement), neither the Company nor any Guarantor has previously
entered into any agreement granting any registration rights with respect to its
securities to any Person. 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 or any Guarantor's securities under any agreement in
effect on the date hereof.
(c) Adjustments Affecting the Notes. The Company and the
Guarantors will not take any action, or permit any change to occur, with respect
to the
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Notes that would materially and adversely affect the ability of the Holders to
Consummate any Exchange Offer.
(d) Amendments and Waivers. The provisions of this Agreement
may not be amended, modified or supplemented, and waivers or consents to or
departures from the provisions hereof may not be given unless the Company have
obtained the written consent of Holders of a majority of the outstanding
principal amount of the Transfer Restricted Securities affected by such
amendment, modification, supplement, waiver or consent. Notwithstanding the
foregoing, a waiver or consent to departure from the provisions hereof that
relates exclusively to the rights of Holders whose securities are being tendered
pursuant to the Exchange Offer and that does not affect directly or indirectly
the rights of other Holders whose securities are not being tendered pursuant to
such Exchange Offer may be given by the Holders of a majority of the outstanding
principal amount of Transfer Restricted Securities being tendered or registered.
(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, facsimile or
air courier guaranteeing overnight delivery:
(i) if to a Holder, at the address set forth on the
records of the Registrar under the Indenture, with a copy to
the Registrar under the Indenture; and
(ii) if to the Company or the Guarantors to:
Grant Prideco, Inc.
0000 Xxxx Xxxxxxx Xxxxx, Xxxxx 000
Xxx Xxxxxxxxx, Xxxxx 00000
Attention: Xxxxxx X. Xxxxxx
Fax: (000) 000-0000
with a copy to:
Fulbright & Xxxxxxxx L.L.P.
0000 XxXxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxx 00000
Attention:
Fax:
Any such notices and communications shall take effect at the
time of receipt thereof. The Company shall be entitled to act and rely upon any
notice or communication given or made by the Initial Purchasers.
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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.
(f) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties, including without limitation and without the need for an express
assignment, subsequent Holders; provided, however, that this Agreement shall not
inure to the benefit of or be binding upon a successor or assign of a Holder
unless and to the extent such successor or assign acquired Transfer Restricted
Securities from such Holder.
(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 AND INTERPRETED, IN ACCORDANCE WITH THE LAW 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.
(k) Entire Agreement. This Agreement together with the other
Operative Documents (as defined in the Purchase 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 and the
Guarantors with respect to the Transfer Restricted Securities. This Agreement
supersedes all prior agreements and understandings between the parties with
respect to such subject matter.
Signature pages follow.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
Very truly yours,
THE COMPANY:
GRANT PRIDECO, INC.
By: /s/ Xxxx X. Xxxxx
--------------------------------------
Xxxx X. Xxxxx
President and CEO
THE GUARANTORS:
GP EXPATRIATE SERVICES, INC.
By: /s/ Xxxx X. Xxxxx
--------------------------------------
Xxxx X. Xxxxx
President and CEO
GRANT PRIDECO HOLDING, LLC
By: /s/ Xxxx X. Xxxxx
--------------------------------------
Xxxx X. Xxxxx
President and CEO
GRANT PRIDECO, LP
By: Grant Prideco Holding, LLC, its
general partner
By: /s/ Xxxx X. Xxxxx
--------------------------------------
Xxxx X. Xxxxx
President and CEO
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GRANT PRIDECO USA, LLC
By: /s/ Authorized Signatory
--------------------------------------
Name:
Title:
STAR OPERATING COMPANY
By: /s/ Xxxx X. Xxxxx
--------------------------------------
Xxxx X. Xxxxx
President and CEO
TA INDUSTRIES, INC.
By: /s/ Xxxx X. Xxxxx
--------------------------------------
Xxxx X. Xxxxx
President and CEO
TEXAS ARAI, INC.
By: /s/ Xxxx X. Xxxxx
--------------------------------------
Xxxx X. Xxxxx
President and CEO
TUBE-ALLOY CAPITAL CORPORATION
By: /s/ Xxxx X. Xxxxx
--------------------------------------
Xxxx X. Xxxxx
President and CEO
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TUBE-ALLOY CORPORATION
By: /s/ Xxxx X. Xxxxx
--------------------------------------
Xxxx X. Xxxxx
President and CEO
XL SYSTEMS INTERNATIONAL, INC.
By: /s/ Xxxx X. Xxxxx
--------------------------------------
Xxxx X. Xxxxx
President and CEO
XL SYSTEMS, L.P.
By: Grant Prideco Holding, LLC, its
general partner
By: /s/ Xxxx X. Xxxxx
--------------------------------------
Xxxx X. Xxxxx
President and CEO
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Accepted on behalf of the Initial Purchasers:
XXXXXX BROTHERS INC.
By: /s/ Authorized Signatory
-----------------------------------
Name:
Title:
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