Exhibit 4.5
COMMON STOCK REGISTRATION RIGHTS AGREEMENT
Dated as of February 14, 1997
among
OPTEL, INC.,
VPC CORPORATION,
LE GROUPE VIDEOTRON LTEE,
SALOMON BROTHERS INC,
as an Initial Purchaser,
AND
XXXXXXX LYNCH, PIERCE, XXXXXX &
XXXXX, INCORPORATED,
as an Initial Purchaser
AND
U.S. TRUST COMPANY OF TEXAS, N.A.,
as Transfer Agent to the limited extent
set forth herein
THIS COMMON STOCK REGISTRATION RIGHTS AGREEMENT (the "Agreement") is
made and entered into as of February 14, 1997, among Optel, Inc., a Delaware
corporation (the "Company"), VPC Corporation, a Delaware corporation ("VPC"), Le
Groupe Videotron Lte'e, a Quebec corporation ("GVL") and Salomon Brothers Inc
("Salomon") and Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx, Incorporated (together
with Salomon, the "Initial Purchasers") and, as to Sections 3.5 to 3.7 only,
U.S. Trust Company of Texas, N.A. ("Transfer Agent").
This Agreement is made pursuant to the Purchase Agreement, dated as
of February 7, 1997, among the Company and the Initial Purchasers (the "Purchase
Agreement"), relating to the sale by the Company to the Initial Purchasers of an
aggregate of 225,000 Units, each Unit consisting of $1,000 principal amount 13%
Senior Notes Due 2005 (the "Notes") and one share of Class C Common Stock, par
value $0.01 per share, of the Company (the "Non-Voting Common Stock"). In order
to induce the Initial Purchasers to enter into the Purchase Agreement, the
Company has agreed to provide to the Holders (as defined herein) the
registration rights for the Registrable Securities (as defined herein) set forth
in this Agreement and GVL and VPC, for themselves and their Affiliates, have
agreed to provide the Holders, among other things, the tag-along rights for the
Shares and Registrable Securities set forth herein. The execution of this
Agreement is a condition to the obligations of the Initial Purchasers to
purchase the Units under the Purchase Agreement.
In consideration of the foregoing, the parties hereto agree as
follows:
1. Definitions. As used in this Agreement, the following capitalized
defined terms shall have the following meanings:
"Advice" shall have the meaning ascribed to that term in the last
paragraph of Section 4.
"Affiliate" means, when used with reference to any Person, any other
Person directly or indirectly controlling, controlled by, or under direct
or indirect common control with, the referent Person or such other Person,
as the case may be. For the purposes of this definition, "control"
(including, with correlative meanings, the term "controlling," "controlled
by," and "under common control with"), when used with respect to any
specified Person, means the power to direct or cause the direction of
management or policies of such Person,
directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise.
"Agreement" shall have the meaning ascribed to that
term in the preamble hereto.
"Blackout Period" shall have the meaning ascribed to that term in
Section 2.1.
"Business Day" shall mean a day that is not a Legal
Holiday.
"Capital Stock" shall mean, with respect to any Person, any and all
shares or other equivalents (however designated) of capital stock,
partnership interests or any other participation, right or other interest
in the nature of an equity interest in such Person or any option, warrant
or other security convertible into or exercisable or exchangeable for any
of the foregoing.
"Change of Control" shall have the meaning ascribed to that term in
the Indenture dated as of February 14, 1997 among the Company and U.S.
Trust Company of Texas, N.A., as Trustee, as in effect on the date hereof.
"Common Stock" shall mean the Class A Common Stock, par value $0.01
per share, of the Company, the Class B Common Stock, par value $0.01 per
share, of the Company ("Class B Common Stock") the Non-Voting Common Stock
of the Company and any common stock equivalents, participations or
interests and any options, warrants or security convertible into or
exercisable or exchangeable for any of the foregoing.
"Company" shall have the meaning ascribed to that term in the
preamble hereto and shall also include the Company's successors.
"Convertible Notes" means all 15% convertible subordinated
promissory notes of the Company that are outstanding on February 14, 1997
(after giving effect to the use of proceeds from the issuance of the
Notes) and all other securities convertible into or exercisable or
exchangeable for Common Stock of the Company.
"Current Market Value" per share of Common Stock of the Company or
any other security at any date means (i) if the security is not registered
under the Exchange Act, the Fair Market Value of the security as
determined by an Independent Financial Expert selected by the Company or
(ii)(a) if the security is registered under the Exchange Act, the average
of the daily market prices of the securities for the 20 consecutive days
immediately preceding such date, or (b) if the securities have been
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registered under the Exchange Act for less than 20 consecutive trading
days before such date, then the average of the closing sales prices for
all of the trading days before such date for which closing sales prices
are available, in the case of each of (ii)(a) and (ii)(b), as certified to
the Holders by the President, any Vice President or the Chief Financial
Officer of the Company. The market price for each such trading day shall
be: (A) in the case of a security listed or admitted to trading on any
United States national securities exchange or quotation system, the
closing sales price, regular way on such day, or if no sale takes place on
such day, the average of the closing bid and asked prices on such day, (B)
in the case of a security not then listed or admitted to trading on any
national securities exchange or quotation system, the last reported sale
price on such day, or if no sale takes place on such day, the average of
the closing bid and asked prices on such day, as reported by a reputable
quotation source designated by the Company, (C) in the case of a security
not then listed or admitted to trading on any national securities exchange
or quotation system and as to which no such reported sale price or bid and
asked prices are available, the average of the reported high bid and low
asked prices on such day, as reported by a reputable quotation service, or
a newspaper of general circulation in the Borough of Manhattan, City and
State of New York, customarily published on each Business Day, designated
by the Company, or, if there shall be no bid and asked prices on such day,
the average of the high bid and low asked prices, as so reported, on the
most recent day (not more than 30 days prior to the date in question) for
which prices have been so reported and (D) if there are no bid and asked
prices reported during the 30 days prior to the date in question, the
Current Market Value shall be determined as if the securities were not
registered under the Exchange Act.
"Definitive Certificate" refers to Shares that are not represented
by the Global Certificate and, instead, are issued in definitive
registered form.
"Demand Registration" shall have the meaning ascribed to that term
in Section 2.1.
"Depositary" means The Depository Trust Company, its nominees and
successors.
"Effectiveness Period" shall have the meaning ascribed to that term
in Section 2.1.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.
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"Excluded Transfer" shall mean (i) a Transfer by GVL or any of its
Affiliates to an Affiliate of GVL so long as such Affiliate agrees to be
bound by the transferor's obligations under this Agreement to the same
extent as GVL, (ii) a Transfer pursuant to a registered public offering,
in which holders of Shares and Registrable Securities have available to
them (without cut-back) the rights provided under Section 2.2 and (iii)
except when the proviso of Section 3.3(c) applies, a Transfer to a
Permitted Holder (as defined in the Indenture) and Transfer(s) of up to
10% of the Shares of Common Stock owned by GVL and its Affiliates as of
the date hereof.
"Fair Market Value" shall mean the value of any securities as
determined (without any discount for lack of liquidity, the amount of such
securities proposed to be sold or the fact that such securities held by
any Holder of such security may represent a minority interest in a private
company) by an Independent Financial Expert selected by the Company for
the determination of such value.
"Fully Diluted Shares" shall mean the outstanding shares of Common
Stock of the Company, after giving effect to the exercise of all
outstanding options, warrants or other rights or securities to acquire
Common Stock; provided, in the case of the Convertible Notes (for so long
as they are convertible), that all principal and interest as of the first
possible conversion date shall have been converted into Common Stock
without giving effect to any contingency, such as the occurrence of an
initial public equity offering.
"Global Certificate" refers to the initial form of Share
certificates which, unless otherwise instructed, will be issued in global
form and held by the Depositary.
"Holder" shall mean the Initial Purchasers, for so long as the
Initial Purchasers own any Registrable Securities, and their successors,
assigns and direct and indirect transferees who become registered owners
of Registrable Securities.
"Included Securities" shall have the meaning ascribed to that term
in the Section 3.3.
"Independent Financial Expert" means a United States investment
banking firm of national standing in the United States (i) which does not,
and whose directors, officers and employees or Affiliates do not, have a
direct or indirect material financial interest for its proprietary account
in the Company or any of its Affiliates and (ii) which, in the judgment of
the Board of Directors of the Company, is otherwise independent with
respect to the
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Company and its Affiliates and qualified to perform the task for which it
is to be engaged.
"Initial Public Equity Offering" means a primary public offering
(whether or not underwritten, but excluding any offering pursuant to Form
S-8 under the Securities Act or any other publicly registered offering
pursuant to the Securities Act pertaining to an issuance of shares of
Common Stock or securities exercisable therefor under any benefit plan,
employee compensation plan, or employee or director stock purchase plan)
of Common Stock of the Company pursuant to an effective registration
statement under the Securities Act.
"Initial Purchasers" shall have the meaning ascribed to that term in
the preamble hereto.
"Legal Holiday" shall mean a Saturday, a Sunday or a day on which
banking institutions in New York, New York are required by law, regulation
or executive order to remain closed.
"Lock Up Period" shall have the meaning ascribed to that term in
Section 2.1.
"Notes" shall have the meaning ascribed to that term in the preamble
hereto.
"Participating Holder" shall have the meaning ascribed to that term
in Section 3.3.
"Person" shall mean an individual, partnership, corporation, trust
or unincorporated organization, or a government or agency or political
subdivision thereof.
"Piggy-Back Registration" shall have the meaning ascribed to that
term in Section 2.2.
"Proposed Purchaser" shall have the meaning ascribed to that term in
Section 3.3.
"Proposed Transfer Date" shall have the meaning ascribed to that
term in Section 3.3.
"Prospectus" means the prospectus included in any Registration
Statement (including, without limitation, a prospectus that discloses
information previously omitted from a prospectus filed as part of an
effective registration statement in reliance upon Rule 430A promulgated
pursuant to the Securities Act), as amended or supplemented by any
prospectus supplement, with respect to the terms of the offering of any
portion of the Registrable Securities covered by such Registration
Statement, and all other amendments and supplements to any
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such prospectus, including post-effective amendments, and all material
incorporated by reference or deemed to be incorporated by reference, if
any, in such prospectus.
"Purchase Agreement" shall have the meaning ascribed to that term in
the preamble hereto.
"Purchase Election Date" shall have the meaning ascribed to that
term in Section 2.1.
"Purchase Offer" shall have the meaning ascribed to that term in
Section 2.1.
"Purchase Offer Payment Date" shall have the meaning ascribed to
that term in Section 2.1.
"Purchase Offer Securities" shall have the meaning ascribed to that
term in Section 2.1.
"Registrable Securities" shall mean any of (a) the Shares and (b)
any other securities issued or issuable with respect to or in exchange for
the Shares by way of stock dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation or other
reorganization or otherwise. As to any particular Registrable Securities,
such securities shall cease to be Registrable Securities when (a) a
Registration Statement with respect to the offering of such securities by
the Holder thereof shall have been declared effective under the Securities
Act and such securities shall have been disposed of by such Holder
pursuant to such Registration Statement, (b) such securities have been
sold to the public pursuant to Rule 144(k) (or any similar provision then
in force, but not Rule 144A) promulgated under the Securities Act or are
eligible for sale to the public without volume or manner of sale
restrictions under Rule 144(k) (or any similar provision then in force,
but not Rule 144A) promulgated under the Securities Act, (c) such
securities shall have been otherwise transferred and new certificates for
such securities not bearing a legend restricting further transfer shall
have been delivered by the Company or its transfer agent and subsequent
disposition of such securities shall not require registration or
qualification under the Securities Act or any similar state law then in
force or (d) such securities shall have ceased to be outstanding.
"Registration Expenses" shall mean all expenses incident to the
Company's performance of or compliance with this Agreement, including,
without limitation, all SEC and stock exchange or National Association of
Securities Dealers, Inc. registration and filing fees and expenses, fees
and expenses of compliance with securities
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or blue sky laws (including, without limitation, in the event of an
underwritten offering, reasonable fees and disbursements of counsel for
the underwriters in connection with blue sky qualifications of the
Registrable Securities), rating agency fees, printing expenses, messenger,
telephone and delivery expenses, fees and disbursements of counsel for the
Company and all independent certified public accountants, and, in the
event of an underwritten offering, the fees and disbursements of
underwriters customarily paid by issuers or sellers of securities (but not
including any underwriting discounts or commissions or transfer taxes, if
any, attributable to the sale of Registrable Securities by Holders of such
Registrable Securities).
"Registration Statement" shall mean any registration statement of
the Company which covers any of the Registrable Securities pursuant to the
provisions of this Agreement and all amendments and supplements to any
such Registration Statement, including post-effective amendments, in each
case including the Prospectus contained therein, all exhibits thereto and
all material incorporated by reference therein.
"Requisite Shares" shall mean a number of Registrable Securities
equivalent to not less than one-third of the Shares originally issued.
"Rule 144" shall mean Rule 144 under the Securities Act, as such
Rule may be amended from time to time, or any similar rule (other than
Rule 144A) or regulation hereafter adopted by the SEC providing for offers
and sales of securities made in compliance therewith resulting in offers
and sales by subsequent holders that are not affiliates of an issuer of
such securities being free of the registration and prospectus delivery
requirements of the Securities Act.
"Rule 144A" shall mean Rule 144A under the Securities Act, as such
Rule may be amended from time to time.
"SEC" shall mean the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended
from time to time.
"Shares" shall mean (a) the Non-Voting Common Stock sold to the
Initial Purchasers as part of the Units pursuant to the Purchase
Agreement, whether held by either of them or any subsequent assignee or
transferee and (b) any other securities issued or issuable with respect to
or in exchange for the Non-Voting Common Stock by way of stock dividend or
stock split or in connection with a
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combination of shares, recapitalization, merger, consolidation or other
reorganization or otherwise.
"Tag-Along Notice" shall have the meaning ascribed to that term in
Section 3.3.
"Tag-Along Right" shall have the meaning ascribed to that term in
Section 3.3.
"Transfer" shall mean, with respect to Common Stock, any sale,
assignment, gift, transfer, exchange, pledge or other disposition.
"Transfer Agent" shall have the meaning ascribed to that term in the
preamble hereto.
"Transfer Notice" shall have the meaning ascribed to that term in
Section 3.3.
"Triggering Date" shall mean the day on which a bona fide
underwritten public offering of Common Stock is consummated, as a result
of which at least 15% of the outstanding shares of Common Stock are listed
on a national securities exchange or the Nasdaq National Market System.
"Triggering Event" shall mean the occurrence of any of the
following: (i) the day immediately prior to a Change of Control, (ii) the
90th day (or such earlier date as determined by the Company in its sole
discretion) following an Initial Public Equity Offering or (iii) other
than as a result of an Initial Public Equity Offering, a class of common
equity securities of the Company is listed on a national securities
exchange or authorized for quotation on the Nasdaq National Market System
or is otherwise subject to registration under the Exchange Act.
"Withdrawal Election" shall have the meaning ascribed to that term
in Section 2.3(b).
2. Registration Rights.
2.1 Demand Registration. (a) Request for Registration. At any time
on or after the earlier to occur of February 15, 2002 or the occurrence of a
Triggering Event, Holders owning, individually or in the aggregate, at least the
Requisite Shares may make one written request for registration under the
Securities Act of their Registrable Securities (a "Demand Registration"). Any
such request will specify the number of Registrable Securities proposed to be
sold and will also specify the intended method of disposition thereof. Subject
to the other provisions of this Section 2.1, the Company shall give written
notice of such registration request within 10 days after the receipt thereof to
all other Holders.
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Within 30 days after receipt of such notice by any Holder, such Holder may
request in writing that its Registrable Securities be included in such
registration and the Company shall include in the Demand Registration the
Registrable Securities of any such selling Holder requested to be so included.
Each such request by such other selling Holders shall specify the number of
Registrable Securities proposed to be sold and the intended method of
disposition thereof. Upon a demand, the Company will (i) prepare, file and use
its best efforts to cause to become effective within 120 days of such demand a
Registration Statement in respect of all the Registrable Securities which
Holders request for inclusion therein; provided that if such demand occurs
during a Black Out Period or a period (not to exceed 180 days) during which the
Company is prohibited or restricted from issuing or selling Common Stock
pursuant to any underwriting or purchase agreement relating to an underwritten
public offering of Common Stock or securities convertible into or exchangeable
for Common Stock under Rule 144A or registered under the Security Act or any
agreement with a securityholder of the Company exercising registration rights
pursuant to an agreement in existence on the date hereof (a "Lock Up Period"),
the Company shall not be required to notify the Holders of such demand or file
such Registration Statement prior to the end of the Black Out Period or Lock Up
Period, as the case may be, in which event, the Company will use its best
efforts to cause such Registration Statement to become effective no later than
30 days after the end of the Black Out Period or Lock Up Period, as the case may
be, and (ii) keep such Registration Statement continuously effective for the
shorter of (a) 180 days (the "Effectiveness Period") and (b) such period of time
as all of the Registrable Securities included in such Registration Statement
have been sold thereunder; provided, however, that the Company may postpone the
filing period, suspend the effectiveness of any registration, suspend the use of
any Prospectus and shall not be required to amend or supplement the Registration
Statement, any related Prospectus or any document incorporated therein by
reference (other than an effective registration statement being used for an
underwritten offering) in the event that, and for a period, in the case of any
particular Demand Registration, not to exceed an aggregate of 45 days ("Black
Out Period") if (i) an event or circumstance occurs and is continuing as a
result of which the Registration Statement, any related Prospectus or any
document incorporated therein by reference as then amended or supplemented
would, in the Company's good faith judgment, contain an untrue statement of a
material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, and (ii)(A) the Company determines in its good faith
judgment that the disclosure of such event at such time would have a material
adverse effect on the business, operations or prospects of the Company or (B)
the disclosure otherwise relates to a material business transaction which has
not yet been publicly disclosed; provided, further that the
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Effectiveness Period shall be extended by the number of days in any Black Out
Period. Subject to Section 2.1(b), the Company shall only be required to
register Registrable Securities pursuant to this Section 2.1 once.
In the event of the occurrence of any Black Out Period during an
Effectiveness Period or Lock Up Period, the Company will promptly notify the
Holders of Registrable Securities thereof in writing.
(b) Effective Registration. Except as specifically provided herein,
the Company is only required to effect one registration as a Demand Registration
under this Agreement (whether or not all of the holders of Registrable
Securities elect to participate in such Demand Registration on the basis set
forth herein). A registration will not be deemed to have been effected as a
Demand Registration, and thereby satisfy the obligation hereunder, unless it has
been declared effective by the SEC and the Company has complied in all material
respects with its obligations under this Agreement with respect thereto;
provided that if, after it has become effective, the offering of Registrable
Securities pursuant to such registration is or becomes the subject of any stop
order, injunction or other order or requirement of the SEC or any other
governmental or administrative agency, or if any court prevents or otherwise
limits the sale of Registrable Securities pursuant to the registration (for any
reason other than the act or omissions of the Holders) for the period of time
contemplated hereby, such registration will be deemed not to have been effected.
If (i) a registration requested pursuant to this Section 2.1 is deemed not to
have been effected or (ii) the registration requested pursuant to this Section
2.1 does not remain effective for the Effectiveness Period, then the Company
shall continue to be obligated to effect an additional registration pursuant to
this Section 2.1. The Holders of Registrable Securities shall be permitted to
withdraw all or any part of the Registrable Securities from a Demand
Registration at any time prior to the effective date of such Demand
Registration. If at any time a Registration Statement is filed pursuant to a
Demand Registration, and subsequently a sufficient number of the Registrable
Securities are withdrawn from the Demand Registration so that such Registration
Statement does not cover that number of Registrable Securities at least equal to
one-third of the Shares originally issued, the Holders who have not withdrawn
their Registrable Securities shall have the opportunity to include an additional
number of Registrable Securities in the Demand Registration so that such
Registration Statement covers that number of Registrable Securities at least
equal to one-third of the Shares originally issued. If an additional number of
Registrable Securities is not so included, the Company may withdraw the
Registration Statement. Such withdrawn Registration Statement will not count as
a Demand Registration and the Company shall continue to be obligated to effect a
registration pursuant to this Section 2.1; provided
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the Holders that requested withdrawal shall be obligated to reimburse the
Company for all customary and reasonable out-of-pocket expenses incurred by it
in performing its obligations hereunder with respect to such withdrawn
Registration Statement.
(c) Priority in Demand Registrations Pursuant to Section 2.1. If a
Demand Registration pursuant to this Section 2.1 involves an underwritten
offering and the lead managing underwriter advises the Company in writing that,
in its view, the number of Registrable Securities requested by the Holders to be
included in such registration, together with any other securities permitted to
be included in such registration pursuant to Section 8(c) hereof exceeds the
number which, in the view of such lead managing underwriter, can be sold: first,
the securities other than the Registrable Securities of the Holders included in
such registration shall be reduced in their entirety before any reduction of
Registrable Securities; and second, to the extent the reduction set forth in the
immediately preceding clause is insufficient to reduce the number of securities
requested for inclusion in such registration to a number, which, in the view of
such lead managing underwriter, can be sold, the number of such Registrable
Securities to be included in such registration shall be allocated pro rata among
all requesting Holders on the basis of the relative number of Registrable
Securities then held by each such Holder (provided that any Registrable
Securities thereby allocated to any such Holder that exceed such Holder's
request shall be reallocated among the remaining requesting Holders in like
manner). In the event that the number of Registrable Securities requested to be
included in such registration is less than the number which, in the view of the
lead managing underwriter, can be sold, the Company may include in such
registration the securities the Company or any other Person proposes to sell up
to the number of securities that, in the view of the lead managing underwriter,
can be sold.
(d) Selection of Underwriter. If the Holders so elect, the offering
of such Registrable Securities pursuant to such Demand Registration shall be in
the form of an underwritten offering. The Company shall select one or more
nationally recognized firms of investment bankers (to whom a majority of Holders
making such Demand Registration shall not have reasonably objected) to act as
the managing underwriter or underwriters in connection with such offering and
shall select any additional investment bankers and managers to be used in
connection with the offering.
(e) Expenses. The Company will pay all Registration Expenses in
connection with the registration requested pursuant to Section 2.1(a). Each
Holder shall pay all underwriting discounts and commissions and transfer taxes,
if any, relating to the sale or disposition of such Holder's Registrable
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Securities pursuant to a registration statement requested pursuant to this
Section 2.1.
(f) Repurchase Elections. (i) Notwithstanding the foregoing
provisions of this Section 2.1, the Company shall not be obligated to effect a
Demand Registration if the Company has complied with the requirement to give
notice of a request for a Demand Registration to the Holders pursuant to clause
(a) of this Section 2.1 and elects to make an offer to repurchase (a "Purchase
Offer") all of the Registrable Securities requested for inclusion in such Demand
Registration (the "Purchase Offer Securities") within 30 days of receipt of such
notice from the Company by mailing notice of such Purchase Offer to all Holders
of such Registrable Securities on a date (the "Purchase Election Date") not more
than 60 days after the receipt of any request for a Demand Registration and
indicating in such Purchase Offer that the purchase will be consummated on a
Business Day (the "Purchase Offer Payment Date") not more than 60 days after the
Purchase Election Date at a price equal to the Current Market Value of such
Registrable Securities as of the Purchase Offer Payment Date.
(ii) Notice of a Purchase Offer shall be mailed by the Company (or
caused to be mailed by the Company), not less than 30 days nor more than 60 days
before the Purchase Offer Payment Date to each Holder of Purchase Offer
Securities at its last registered address. The Purchase Offer shall remain open
from the time of mailing for at least 20 Business Days and until 5:00 p.m., New
York City time, on the Business Day next preceding the Purchase Offer Payment
Date. The notice, which shall govern the terms of the Purchase Offer, shall
include such disclosures as are required by law and shall state:
(1) that the Purchase Offer is being made pursuant to this Section
2.1(f) and that all Purchase Offer Securities tendered for repurchase will
be accepted for payment;
(2) the purchase price of the Purchase Offer Securities (or the
manner of calculation thereof) and the Purchase Offer Payment Date;
(3) that any Purchase Offer Securities accepted for payment pursuant
to the Purchase Offer shall cease to be outstanding after the Purchase
Offer Payment Date unless the Company defaults in making payment therefor
of the purchase price;
(4) that Holders electing to have Purchase Offer Securities
purchased pursuant to a Purchase Offer will be required to surrender such
Purchase Offer Securities, together with a completed letter of
transmittal, to the Company (or its agent as designated by the Company in
such notice) at the address specified in the notice no later
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than 5:00 p.m. New York City time on the Business Day prior to the
Purchase Offer Payment Date;
(5) that Holders will be entitled to withdraw their election if the
Company (or such designated agent) receives, not later than 5:00 p.m. New
York City time on the Business Day prior to the Purchase Offer Payment
Date, a telegram, telex, facsimile transmission or letter setting forth
the name of the Holder, the number of Purchase Offer Securities delivered
for purchase and a statement that such Holder is withdrawing its election
to have such Purchase Offer Securities purchased and promptly thereafter
the Company (or such designated agent) shall redeliver the withdrawn
Purchase Offer Securities to the Holder;
(6) that a Holder electing not to tender such Holder's Purchase
Offer Securities for purchase pursuant to such Purchase Offer by 5:00 p.m.
New York City time on the Business Day prior to the Purchase Offer Payment
Date will have no continuing right to require the Company to repurchase
such Holder's Purchase Offer Securities; and
(7) that Holders whose Purchase Offer Securities are tendered for
purchase in part only will be issued new certificates representing the
number of the unpurchased Purchase Offer Securities surrendered.
On the Purchase Offer Payment Date, the Company shall (i) accept for
payment Purchase Offer Securities or portions thereof tendered pursuant to the
Purchase Offer, (ii) promptly deliver to Holders of Purchase Offer Securities so
accepted payment of the purchase price therefor and (iii) issue and mail or
deliver to such Holders new certificates representing a number of Purchase Offer
Securities equal to the unpurchased portion of the Purchase Offer Securities
surrendered. Upon payment for all Purchase Offer Securities tendered pursuant to
a Purchase Offer the Company shall be deemed to have effected the Demand
Registration requested.
2.2 Piggy-Back Registration. If at any time the Company proposes to
file a Registration Statement under the Securities Act with respect to an
offering by the Company for its own account or for the account of any of its
respective securityholders of any class of Common Stock (other than (i) a
registration statement on Form S-4 or S-8 (or any substitute form that may be
adopted by the SEC), (ii) a registration statement filed in connection with an
offer or offering of securities solely to the Company's existing securityholders
or (iii) a Demand Registration, then the Company shall give written notice of
such proposed filing to the Holders of Registrable Securities as soon as
practicable (but in no event less than 20 Business Days before the anticipated
filing date), and such notice shall offer such Holders the opportunity to
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register such number of Registrable Securities as each such Holder may request
(which request shall specify the Registrable Securities intended to be disposed
of by such Holder and the intended method of distribution thereof) (a
"Piggy-Back Registration"). The Company shall use its best efforts to cause the
managing underwriter or underwriters of such proposed underwritten offering to
permit the Registrable Securities requested to be included in a Piggy-Back
Registration to be included on the same terms and conditions as any similar
securities of the Company or any other securityholder included therein and to
permit the sale or other disposition of such Registrable Securities in
accordance with the intended method of distribution thereof, provided, however,
in no event shall the Company be required to reduce the number of securities
proposed to be sold by the Company or alter the terms of the securities proposed
to be sold by the Company in order to induce the managing underwriter or
underwriters to permit Registrable Securities to be included. Any Holder shall
have the right to withdraw its request for inclusion of its Registrable
Securities in any Registration Statement pursuant to this Section 2.2 by giving
written notice to the Company of its request to withdraw prior to the
effectiveness of the Registration Statement. The Company may withdraw a
Piggy-Back Registration at any time prior to the time it becomes effective;
provided that the Company shall give prompt notice thereof to participating
Holders. The Company will pay all Registration Expenses in connection with each
registration of Registrable Securities requested pursuant to this Section 2.2,
and each Holder shall pay all underwriting discounts and commissions and
transfer taxes, if any, relating to the sale or disposition of such Holder's
Registrable Securities pursuant to a registration statement effected pursuant to
this Section 2.2.
No registration effected under this Section 2.2, and no failure to
effect a registration under this Section 2.2, shall relieve the Company of its
obligation to effect a registration upon the request of Holders pursuant to
Section 2.1, and no failure to effect a registration under this Section 2.2 and
to complete the sale of Registrable Securities in connection therewith shall
relieve the Company of any other obligation under this Agreement.
2.3 Reduction of Offering. (a) Piggy-Back Registration. (i) If the
lead managing underwriter of any underwritten offering described in Section 2.2
has informed, in writing, the Holders of the Registrable Securities requesting
inclusion in such offering that it is its view that the total number of
securities which the Company, the Holders and any other Persons desiring to
participate in such registration intend to include in such offering is such as
to materially and adversely affect the success of such offering, including the
price at which such securities can be sold, then the number of Registrable
Securities to be offered for the account of such Holders and the number of such
securities to be offered for the
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account of all such other Persons (other than the Company) participating in such
registration shall be reduced or limited pro rata in proportion to the
respective number of securities requested to be registered to the extent
necessary to reduce the total number of securities requested to be included in
such offering to the number of securities, if any, recommended by such lead
managing underwriter, subject to the terms of any existing registration rights
agreements as in effect on the date hereof; provided that if such offering is
effected for the account of any securityholder of the Company other than the
Holders, pursuant to the demand registration rights of any such securityholder,
then the number of securities to be offered for the account of the Company (if
any) and the Holders (but not such securityholders who have exercised their
demand registration rights) shall be reduced or limited pro rata in proportion
to the respective number of securities requested to be registered to the extent
necessary to reduce the total number of securities requested to be included in
such offering to the number of securities, if any, recommended by such lead
managing underwriter.
(ii) If the lead managing underwriter of any underwritten offering
described in Section 2.2 notifies the Holders requesting inclusion of
Registrable Securities in such offering, that the kind of securities that such
Holders, the Company and any other Persons desiring to participate in such
registration intend to include in such offering is such as to materially and
adversely affect the success of such offering, (x) the Registrable Securities to
be included in such offering shall be reduced as described in clause (i) above
or (y) if a reduction in the Registrable Securities pursuant to clause (i) above
would, in the judgment of the lead managing underwriter, be insufficient to
substantially eliminate the adverse effect that inclusion of the Registrable
Securities requested to be included would have on such offering, such
Registrable Securities will be excluded from such offering.
(b) If, as a result of the proration provisions of this Section 2.3,
any Holder shall not be entitled to include all Registrable Securities in a
Piggy-Back Registration that such Holder has requested to be included, such
Holder may elect to withdraw his request to include Registrable Securities in
such registration (a "Withdrawal Election"); provided that a Withdrawal Election
shall be made prior to the effectiveness of the Registration Statement and shall
be irrevocable and, after making a Withdrawal Election, a Holder shall no longer
have any right to include Registrable Securities in the registration as to which
such Withdrawal Election was made.
2.4 Lock Up of Holders. If the Company has complied with all of its
obligations with respect to a Demand Registration or a Piggy-Back Registration
that is a firm commitment underwritten public offering, all Holders of
Registrable Securities, upon request of the lead managing
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underwriter with respect to such underwritten public offering, agree not to sell
or otherwise dispose of any Registrable Security owned by them for a period not
to exceed 180 days from the consummation of such underwritten public offering;
provided that Registrable Securities which had been requested for inclusion in a
Demand Registration or a Piggy-Back Registration but which were not so included
pursuant to Section 2.1(c) or Section 2.3 shall only be subject to the
restriction on sale and disposition in this Section 2.4 for a period not to
exceed 90 days from the consummation of such underwritten public offering.
3. Transfers.
3.1 Generally. All Shares and Registrable Securities at any time and
from time to time outstanding shall be held subject to the conditions and
restrictions set forth in this Section 3. All shares of Capital Stock now or
hereafter beneficially owned by GVL, VPC and each of their Affiliates shall be
held subject to the conditions and restrictions set forth in this Section 3.
Each Holder of Shares and Registrable Securities, GVL and VPC by executing this
Agreement or by accepting a certificate representing Capital Stock or other
indicia of ownership therefor from the Company agree with the Company and with
each other Stockholder to such conditions and restrictions.
3.2 Restrictions on Transfer. (a) The Company will keep, at the
office or agency maintained by the Company for such purpose, a register or
registers in which, subject to such reasonable regulations as it may prescribe,
the Company shall provide for the registration of, and registration of transfer
of, Shares as provided in this Article. Each person designated by the Company
from time to time as a person authorized to register the transfer and exchange
of the Non-Voting Common Stock is hereinafter called, individually and
collectively, the "Transfer Agent." The Company has initially appointed U.S.
Trust Company of Texas, N.A., as Transfer Agent. Upon written notice to U.S.
Trust Company of Texas, N.A., and any acting Transfer Agent, the Company may
appoint a successor Transfer Agent for such purposes.
(b) Any Transfer made in violation of this Agreement by GVL or VPC
or any of their Affiliates shall be deemed null and void and shall not be
recorded as a transfer upon the stock transfer books of the Company. Each
certificate representing shares of Common Stock held by GVL, VPC and each of
their Affiliates and Convertible Notes shall contain conspicuous notation on
such certificate indicating that the transfer of such shares is subject to the
terms and restrictions of this Agreement, and each of GVL and VPC hereby
consents to the placement of such legend on the certificate or certificates
representing the shares of Common Stock and Convertible Notes beneficially owned
by such party.
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3.3 Tag-Along Rights. (a) For so long as GVL, together with its
Affiliates, beneficially owns more shares of Common Stock (treating the
Convertible Notes as converted on the basis used to calculate Fully Diluted
Shares) than any other Person, together with such Person's Affiliates, in the
event of a proposed direct or indirect Transfer of beneficial ownership of
Common Stock or Convertible Notes (whether now or hereafter issued) by GVL or
any of its Affiliates in any transaction or series of related transactions to
any Person (other than an Excluded Transfer) (such other Person being
hereinafter referred to as the "Proposed Purchaser") at any time prior to the
Triggering Date, the holders of Shares and Registrable Securities shall have the
irrevocable and exclusive right, but not the obligation (the "Tag-Along Right"),
to require the Proposed Purchaser to purchase from each of them up to such
number of Shares and Registrable Securities (the "Included Securities")
determined in accordance with Section 3.3(c). GVL shall give written notice (a
"Transfer Notice") at least 30 days prior to the date of the proposed Transfer
(the "Proposed Transfer Date") to the holders of Shares and Registrable
Securities stating (i) the name and address of the Proposed Purchaser, (ii) the
proposed amount of consideration, terms and conditions of payment offered by
such Proposed Purchaser (if the proposed consideration is not cash, the Transfer
Notice shall describe the terms of the proposed consideration) and the time and
place of the closing for the proposed Transfer, (iii) the number of shares of
Common Stock and other securities proposed to be directly or indirectly
Transferred by GVL and/or its Affiliates and (iv) either that the Proposed
Purchaser has been informed of the Tag-Along Right and has agreed to purchase
Shares and Registrable Securities in accordance with the terms hereof or that
GVL or any of its Affiliates will make such purchase. The Tag-Along Right shall
be exercised by any or all of the holders of Shares and Registrable Securities
by giving written notice to the Company ("Tag-Along Notice"), within ten days of
receipt of the Transfer Notice, indicating its election to exercise the
Tag-Along Right (the "Participating Holders"). The Tag-Along Notice shall state
the amount of Shares and Registrable Securities that such holder proposes to
include in such Transfer to the Proposed Purchaser. Failure by any holder to
give such notice within the ten day period shall be deemed an election by such
holder not to sell its Shares and Registrable Securities pursuant to that
Transfer. The closing with respect to any sale to a Proposed Purchaser pursuant
to this Section shall be held at the time and place specified in the Transfer
Notice but in any event within 60 days of the Proposed Transfer Date; provided
that if through the exercise of reasonable efforts GVL or any of its Affiliates
is unable to cause such transaction to close within 60 days, such period may be
extended for such reasonable period of time as may be necessary to close such
transaction. Consummation of the sale of Common Stock or other securities by GVL
and/or its Affiliates to a Proposed Purchaser shall be conditioned upon
consummation of
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the sale by each Participating Holder to such Proposed Purchaser (or GVL) of the
Included Securities, if any.
(b) In the event that the Proposed Purchaser does not purchase
Included Securities from the holders on the same terms and conditions as
purchased from GVL and its Affiliates, then GVL or such Affiliate shall
purchase, or cause another Person to purchase, such Included Securities if the
Transfer occurs.
(c) Each holder of Shares and Registrable Securities shall have the
right to require the Proposed Purchaser to purchase from such holder up to a
percentage of the number of Shares and Registrable Securities owned by such
holder equalling the percentage derived by dividing the total number of shares
of Common Stock (and, in the case of the Convertible Notes, the number of shares
of Common Stock then represented thereby) that GVL and its Affiliates propose to
directly or indirectly Transfer by the total number of shares of Common Stock
(treating the Convertible Notes as converted on the basis used to calculate
Fully Diluted Shares) at the time beneficially owned by GVL and its Affiliates;
provided that in the event of any proposed Transfer, the result of which is that
GVL and its Affiliates would, after giving effect to such Transfer or at the
time of such Transfer, beneficially own less than a majority of the Fully
Diluted Shares, each holder of Shares and Registrable Securities shall have the
right to require the Proposed Purchaser to purchase all of the Shares and
Registrable Securities owned by such holder.
(d) Any Shares and/or Registrable Securities purchased from the
Participating Holders pursuant to this Section 3.3 shall be paid for in the same
type of consideration and at the same price per share of Common Stock and upon
the same terms and conditions of such proposed Transfer of Common Stock by GVL
and/or any of its Affiliates (regardless of whether such shares are Class B
Common Stock or Convertible Notes). If the Registrable Securities to be
purchased include securities or property other than Common Stock, the price to
be paid for such securities or property shall be the same price per share or
other denomination paid by the Proposed Purchaser for like securities purchased
from GVL and/or its Affiliates or, if like securities are not purchased from GVL
and/or its Affiliates by the Proposed Purchaser, the Fair Market Value of such
securities. GVL shall arrange for payment directly by the Proposed Purchaser to
each Participating Holder, upon delivery of the certificate or certificates
representing the Shares and/or Registrable Securities duly endorsed for
transfer, together with such other documents as the Proposed Purchaser may
reasonably request.
(e) If at the end of 60 days following the Proposed Transfer Date,
or as otherwise extended pursuant to the provisions of Section 3.3(a), the sale
of Common Stock by GVL
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and/or its Affiliates and the sale of the Included Securities have not been
completed in accordance with the terms of the Proposed Purchaser's offer, all
certificates representing the Included Securities shall be returned to the
Participating Holders, and all the restrictions on Transfer contained in this
Agreement with respect to Common Stock beneficially owned by GVL and its
Affiliates shall remain in effect.
3.4 Obligation to Sell. For so long as GVL, together with its
Affiliates, directly or indirectly beneficially owns a majority of the
outstanding shares of Common Stock (treating the Convertible Notes as converted
on the basis used to calculate Fully Diluted Shares), if at any time prior to
the Triggering Date, GVL, and/or any of its Affiliates, determines to sell all
of the Capital Stock and Convertible Notes of the Company beneficially owned by
GVL and its Affiliates to a Person other than an Affiliate of GVL or a Permitted
Holder, GVL shall have the right to require the Holders of Registrable
Securities to sell such Registrable Securities to such transferee; provided that
(a) the consideration to be received by the Holders of Registrable Securities
shall be the same type of consideration received by GVL and its Affiliates
(regardless of whether such Capital Stock is Class B Common Stock or Convertible
Notes) and, in any event, shall be cash and/or securities registered under the
Securities Act and listed on a national securities exchange or authorized for
quotation on the Nasdaq National Market System, (b) after giving effect to such
transaction, GVL and its Affiliates shall not beneficially own, directly or
indirectly, any Capital Stock or rights to purchase Capital Stock of the Company
and (c) the foregoing provisions shall not apply to sales of Common Stock by the
Company in a registered public offering under the Securities Act or an offering
pursuant to Rule 144A. Any Registrable Securities purchased from the Holders
pursuant to this Section 3.4 shall be paid for at the same price per share of
Common Stock and upon the same terms and conditions of such proposed transfer of
Common Stock by GVL and its Affiliates (regardless of whether such Capital Stock
is Class B Common Stock or Convertible Notes). If the Registrable Securities to
be purchased include securities other than Common Stock, the price to be paid
for such securities shall be the same price per share or other denomination paid
by the Proposed Purchaser for like securities purchased from GVL and its
Affiliates or, if like securities are not purchased from GVL and its Affiliates,
the Fair Market Value of such securities.
3.5 Registration of Transfers or Exchanges.
(a) Transfer or Exchange of Definitive Certificates. When Definitive
Certificates are presented to the Transfer Agent with a request from the
holder:
(i) to register the transfer of the Definitive Certificates; or
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(ii) to exchange such Definitive Certificates for an equal number of
Definitive Certificates of other authorized denominations,
the Transfer Agent shall register the transfer or make the exchange as requested
if the requirements under this Agreement as set forth in this Section 3.5 for
such transactions are met; provided, however, that the Definitive Certificates
presented or surrendered by a holder for registration of transfer or exchange:
(x) shall be duly endorsed or accompanied by a written instruction of
transfer or exchange in form satisfactory to the Company and the
Transfer Agent, duly executed by such holder or by his attorney,
duly authorized in writing; and
(y) in the case of Shares the offer and sale of which have not been
registered under the Securities Act and are presented for transfer
or exchange prior to (X) the date which is three years (or such
shorter period as may be prescribed by Rule 144(k) (or any successor
provision thereto)) after the later of the date of original issuance
of the Shares and the last date on which the Company or any
affiliate of the Company was the owner of such Shares, or any
predecessor thereto, and (Y) such later date, if any, as may be
required by any subsequent change in applicable law (the "Resale
Restriction Termination Date"), such Shares shall be accompanied by
the following additional information and documents, as applicable:
(A) if such Shares are being delivered to the Transfer Agent by a
holder for registration in the name of such holder, without
transfer, a certification from such holder to that effect (in
substantially the form of Exhibit C hereto); or
(B) if such Shares are being transferred to a qualified
institutional buyer (as defined in Rule 144A under the
Securities Act) (a "QIB") in accordance with Rule 144A under
the Securities Act, a certification from the transferor to
that effect (in substantially the form of Exhibit C hereto);
or
(C) if such Shares are being transferred to an institutional
"accredited investor" within the meaning of subparagraphs
(a)(1), (a)(2), (a)(3) or (a)(7) of Rule 501 under the
Securities Act (an "Institutional Accredited Investor"),
delivery by the transferor of a certification to
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that effect (in substantially the form of Exhibit C hereto),
and delivery by the proposed transferee of a Transferee
Certificate for Institutional Accredited Investors (in
substantially the form of Exhibit D hereto); or
(D) if such Shares are being transferred in reliance on Regulation
S under the Securities Act, delivery by the transferor of a
certification to that effect (in substantially the form of
Exhibit C hereto), and a Certificate for Regulation S
Transfers in the form of Exhibit E hereto; or
(E) if such Shares are being transferred in reliance on Rule 144
under the Securities Act, delivery by the transferor of (i) a
certification from the transferor to that effect (in
substantially the form of Exhibit C hereto), and (ii) an
opinion of counsel reasonably satisfactory to the Company to
the effect that such transfer is in compliance with the
Securities Act; or
(F) if such Shares are being transferred in reliance on another
exemption from the registration requirements of the Securities
Act, a certification from the transferor to that effect (in
substantially the form of Exhibit C hereto) and an opinion of
counsel reasonably satisfactory to the Company to the effect
that such transfer is in compliance with the Securities Act;
provided that the Company may, based upon the views of its own
counsel, instruct the Transfer Agent not to register such
transfer in any case where the proposed transferee is not a
QIB, Non-U.S. Person (as defined in Regulation S) or
Institutional Accredited Investor.
(b) Restrictions on Transfer of a Definitive Certificate for a
Beneficial Interest in a Global Certificate. A Definitive Certificate may not be
transferred by a holder for a beneficial interest in a Global Certificate except
upon satisfaction of the requirements set forth below. Upon receipt by the
Transfer Agent of a Definitive Certificate, duly endorsed or accompanied by
appropriate instruments of transfer, in form satisfactory to the Transfer Agent,
together with:
(A) certification from such holder (in substantially the form of
Exhibit C hereto) that such Definitive Certificate is being
transferred to a QIB in accordance with Rule 144A under the
Securities Act; and
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(B) written instructions directing the Transfer Agent to make, or
to direct the Depositary to make, an endorsement on the Global
Certificate to reflect an increase in the aggregate amount of
the Shares represented by the Global Certificate,
then the Transfer Agent shall cancel such Definitive Certificate and cause, or
direct the Depositary to cause, in accordance with the standing instructions and
procedures existing between the Depositary and the Transfer Agent, the number of
Shares represented by the Global Certificate to be increased accordingly. If no
Global Certificate is then outstanding, the Company shall issue and the Transfer
Agent shall upon written instructions from the Company authenticate a new Global
Certificate in the appropriate amount.
(c) Transfer or Exchange of Global Certificates. The transfer or
exchange of Global Certificates or beneficial interests therein shall be
effected through the Depositary, in accordance with this Section 3.5, the
Private Placement Legend, this Agreement (including the restrictions on transfer
set forth herein) and the procedures of the Depositary therefor.
(d) Transfer or Exchange of a Beneficial Interest in a Global
Certificate for a Definitive Certificate.
(i) Any person having a beneficial interest in a Global Certificate may
transfer or exchange such beneficial interest for a Definitive
Certificate upon receipt by the Transfer Agent of written
instructions or such other form of instructions as is customary for
the Depositary from the Depositary or its nominee on behalf of any
person having a beneficial interest in a Global Certificate,
including a written order containing registration instructions and,
in the case of any such transfer or exchange prior to the Resale
Restriction Termination Date, the following additional information
and documents:
(A) if such beneficial interest is being transferred to the person
designated by the Depositary as being the beneficial owner, a
certification from such person to that effect (in
substantially the form of Exhibit C hereto); or
(B) if such beneficial interest is being transferred to a QIB in
accordance with Rule 144A under the Securities Act, a
certification from the transferor to that effect (in
substantially the form of Exhibit C hereto); or
(C) if such beneficial interest is being transferred to an
Institutional Accredited Investor,
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delivery by the transferor of a certification to that effect
(in substantially the form of Exhibit C hereto), and delivery
by the proposed transferee of a Transferee Certificate for
Institutional Accredited Investors (in substantially the form
of Exhibit D hereto); or
(D) if such beneficial interest is being transferred in reliance
on Regulation S under the Securities Act, delivery by the
transferor of (i) a certification to that effect (in
substantially in the form of Exhibit C hereto), and (ii) a
Certificate for Regulation S Transfers in the form of Exhibit
E hereto; or
(E) if such beneficial interest is being transferred in reliance
on Rule 144 under the Securities Act, delivery by the
transferor of (i) a certification to that effect (in
substantially the form of Exhibit C hereto) and (ii) an
opinion of counsel reasonably satisfactory to the Company to
the effect that such transfer is in compliance with the
Securities Act; or
(F) if such beneficial interest is being transferred in reliance
on another exemption from the registration requirements of the
Securities Act, a certification from the transferor to that
effect (in substantially the form of Exhibit C hereto) and an
opinion of counsel reasonably satisfactory to the Company to
the effect that such transfer is in compliance with the
Securities Act; provided that the Company may instruct the
Transfer Agent not to register such transfer in any case where
the proposed transferee is not a QIB, Non-U.S. Person or
Institutional Accredited Investor;
then the Transfer Agent will cause, in accordance with the standing
instructions and procedures existing between the Depositary and the
Transfer Agent, the aggregate amount of the Global Certificate to be
reduced and, following such reduction, the Company will execute and,
upon receipt of an authentication order in the form of an officers'
certificate (a certificate signed by two officers of such company,
one of whom must be the principal executive officer, principal
financial officer or principal accounting officer) (an "Officers'
Certificate"), the Transfer Agent will authenticate and deliver to
the transferee a Definitive Certificate.
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(ii) Definitive Certificates issued in exchange for a beneficial interest
in a Global Certificate pursuant to this Section 3.5(d) shall be
registered in such names and in such authorized denominations as the
Depositary, pursuant to instructions from its direct or indirect
participants or otherwise, shall instruct the Transfer Agent in
writing. The Transfer Agent shall deliver such Definitive
Certificates to the persons in whose names such Shares are so
registered and adjust the Global Certificate pursuant to paragraph
(h) of this Section 3.5.
(e) Restrictions on Transfer or Exchange of Global Certificates.
Notwithstanding any other provisions of this Agreement (other than the
provisions set forth in subsection (f) of this Section 3.5), a Global
Certificate may not be transferred or exchanged as a whole except by the
Depositary to a nominee of the Depositary or by a nominee of the Depositary to
the Depositary or another nominee of the Depositary or by the Depositary or any
such nominee to a successor Depositary or a nominee of such successor
Depositary.
(f) Authentication of Definitive Certificates in Absence of
Depositary. If at any time:
(i) the Depositary for the Global Certificates notifies the Company that
the Depositary is unwilling or unable to continue as Depositary for
the Global Certificate and a successor Depositary for the Global
Certificate is not appointed by the Company within 90 days after
delivery of such notice; or
(ii) the Company, at its sole discretion, notifies the Transfer Agent in
writing that it elects to cause the issuance of Definitive
Certificates for all Global Certificates under this Agreement,
then the Company will execute, and the Transfer Agent will, upon receipt of an
Officers' Certificate requesting the authentication and delivery of Definitive
Certificates, authenticate and deliver Definitive Certificates, in an aggregate
number equal to the aggregate number of Shares represented by the Global
Certificate, in exchange for such Global Certificate.
(g) Private Placement Legend. Upon the registration of transfer,
exchange or replacement of Share certificates not bearing the legend set forth
in the first paragraph of Exhibit A attached hereto (the "Private Placement
Legend"), the Transfer Agent shall deliver Share certificates that do not bear
the Private Placement Legend. Upon the registration of transfer, exchange or
replacement of Share certificates bearing the Private Placement Legend, the
Transfer Agent shall deliver Share certificates that bear the Private Placement
Legend
-24-
unless, and the Transfer Agent is hereby authorized to deliver Share
certificates without the Private Placement Legend if, (i) the requested transfer
is not prior to the date which is three years (or such shorter period as may be
prescribed by Rule 144(k) (or any successor provision thereto) under the
Securities Act or any successor provision thereunder) after the later of the
original Issue Date of the Shares or the last day on which the Company or any of
its Affiliates was the owner of the Shares or any predecessor security, (ii)
there is delivered to the Transfer Agent an opinion of counsel reasonably
satisfactory to the Company and the Transfer Agent to the effect that neither
such legend nor the related restrictions on transfer are required in order to
maintain compliance with the provisions of the Securities Act or (iii) the
Shares to be transferred or exchanged represented by such Share Certificates are
being transferred or exchanged pursuant to an effective registration statement
under the Securities Act.
(h) Cancellation or Adjustment of a Global Certificate. At such time
as all beneficial interests in a Global Certificate have either been exchanged
for Definitive Certificates, redeemed, repurchased or cancelled, such Global
Certificate shall be returned to the Company or, upon written order to the
Transfer Agent in the form of an Officers' Certificate from the Company,
retained and cancelled by the Transfer Agent. At any time prior to such
cancellation, if any beneficial interest in a Global Certificate is exchanged
for Definitive Certificates, redeemed, repurchased or cancelled, the number of
Shares represented by such Global Certificate shall be reduced and an
endorsement shall be made on such Global Certificate by the Transfer Agent to
reflect such reduction.
(i) Obligations with Respect to Transfers or Exchanges of
Definitive Certificates.
(i) To permit registrations of transfers or exchanges, the Company shall
execute, at the Transfer Agent's request, and the Transfer Agent
shall authenticate Definitive Certificates and Global Certificates.
(ii) All Definitive Certificates and Global Certificates issued upon any
registration, transfer or exchange of Definitive Certificates or
Global Certificates shall be the valid obligations of the Company,
entitled to the same benefits under this Agreement as the Definitive
Certificates or Global Certificates surrendered upon the
registration of transfer or exchange.
(iii) Prior to due presentment for registration of transfer of any Shares,
the Transfer Agent and the Company may deem and treat the person in
whose name any Shares are registered as the absolute owner of such
Shares,
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and neither the Transfer Agent nor the Company shall be affected by
notice to the contrary.
(j) Compliance. Other than following the applicable terms and
requirements of this Agreement, the Transfer Agent shall have no additional duty
to monitor compliance with federal, state or other securities laws.
3.6 Lost, Stolen, Destroyed, Defaced or Mutilated Share
Certificates. Upon receipt by the Company and the Transfer Agent (or any agent
of the Company or the Transfer Agent, if requested by the Company) of evidence
satisfactory to them of the loss, theft, destruction, defacement, or mutilation
of any Share certificate and of an indemnity bond satisfactory to them and, in
the case of mutilation or defacement, upon surrender thereof to the Transfer
Agent for cancellation, then, in the absence of notice to the Company or the
Transfer Agent that such Share certificate has been acquired by a bona fide
purchaser or holder in due course, the Company shall execute, and an authorized
signatory of the Transfer Agent shall manually authenticate and deliver, in
exchange for or in lieu of the lost, stolen, destroyed, defaced or mutilated
Share certificate, a new Share certificate representing a like number of Shares,
bearing a number or other distinguishing symbol not contemporaneously
outstanding. Upon the issuance of any new Share certificate under this Section
in a name other than the prior registered holder of the lost, stolen, destroyed,
defaced or mutilated Share certificate, the Company may require the payment from
the holder of such Share certificate of a sum sufficient to cover any tax, stamp
tax or other governmental charge that may be imposed in relation thereto and any
other expenses (including the fees and expenses of the Transfer Agent and the
Registrar) in connection therewith. Every substitute Share certificate executed
and delivered pursuant to this Section in lieu of any lost, stolen or destroyed
Share certificate shall constitute an additional contractual obligation of the
Company, whether or not the lost, stolen or destroyed Share certificate shall be
at any time enforceable by anyone, and shall be entitled to the benefits of (but
shall be subject to all the limitations of rights set forth in) this Agreement
equally and proportionately with any and all other Share certificates duly
executed and delivered hereunder. The provisions of this Section 3.6 are
exclusive with respect to the replacement of lost, stolen, destroyed, defaced or
mutilated Share certificates and shall preclude (to the extent lawful) any and
all other rights or remedies notwithstanding any law or statute existing or
hereafter enacted to the contrary with respect to the replacement of lost,
stolen, destroyed, defaced or mutilated Share certificates.
3.7 Separation of Shares and Notes. The Notes and the Shares will
not be separately transferable until the Separability Date. "Separability Date"
shall mean the earliest to occur of: (i) August 15, 1997, (ii) the date on which
a
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registration statement under the Securities Act, with respect to a registered
exchange offer for the Notes or covering the sale by holders of the Notes is
declared effective under the Securities Act, (iii) the occurrence of an Event of
Default (as defined in the Indenture), (iv) the occurrence of a Change of
Control (as defined in the Indenture) or (v) such earlier date as may be
determined by Salomon Brothers Inc and specified to the Company, the Trustee,
the Transfer Agent and the Unit Agent in writing. Notwithstanding the foregoing,
in the event a Change of Control (as defined in the Indenture) is proposed and
the Company commences a Change of Control Offer (as defined in the Indenture)
prior to the Separability Date, as determined by the preceding sentence, the
Separability Date shall be such earlier date of commencement. The separation of
the Shares and the Notes is herein referred to as a "Separation."
4. Registration Procedures.
In connection with the obligations of the Company with respect to
any Registration Statement pursuant to Sections 2.1 and 2.2 hereof, the Company
shall:
(a) A reasonable period of time prior to the initial filing of a
Registration Statement or Prospectus and a reasonable period of time prior
to the filing of any amendment or supplement thereto (including any
document that would be incorporated or deemed to be incorporated therein
by reference), furnish to the Holders of the Registrable Securities
included in such Registration Statement, and the managing underwriters, if
any, copies of all such documents proposed to be filed, which documents
(other than those incorporated or deemed to be incorporated by reference)
will be subject to the review of such Holders, and such underwriters, if
any, and use reasonable commercial efforts to cause the officers and
directors of the Company, counsel to the Company and independent certified
public accountants to the Company to respond to such reasonable inquiries
as shall be necessary, in the opinion of respective counsel to such
Holders and such underwriters, to conduct a reasonable investigation
within the meaning of the Securities Act. The Company shall not file any
such Registration Statement or related Prospectus or any amendments or
supplements thereto to which the Holders of a majority of the Registrable
Securities included in such Registration Statement shall reasonably object
on a timely basis;
(b) Prepare and file with the SEC such amendments, including
post-effective amendments, to each Registration Statement as may be
necessary to keep such Registration Statement continuously effective for
the applicable time period required hereunder; cause the related
Prospectus to be supplemented by any required Prospectus supplement, and
as so supplemented to be filed pursuant to Rule 424 under
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the Securities Act; and comply with the provisions of the Securities Act
and the Exchange Act with respect to the disposition of all securities
covered by such Registration Statement during such period in accordance
with the intended methods of disposition by the sellers thereof set forth
in such Registration Statement as so amended or in such Prospectus as so
supplemented;
(c) Notify the holders of Registrable Securities to be sold and the
managing underwriters, if any, promptly, and (if requested by any such
person), confirm such notice in writing, (i)(A) when a Prospectus or any
Prospectus supplement or post-effective amendment is proposed to be filed,
and (B) with respect to a Registration Statement or any post-effective
amendment, when the same has become effective, (ii) of any request by the
SEC or any other Federal or state governmental authority for amendments or
supplements to a Registration Statement or related Prospectus or for
additional information, (iii) of the issuance by the SEC, any state
securities commission, any other governmental agency or any court or any
stop order, order or injunction suspending or enjoining the use of a
Prospectus or the effectiveness of a Registration Statement or the
initiation of any proceedings for that purpose, (iv) of the receipt by the
Company of any notification with respect to the suspension of the
qualification or exemption from qualification of any of the Registrable
Securities for sale in any jurisdiction, or the initiation or threatening
of any proceeding for such purpose, and (v) of the happening of any event
or information becoming known that makes any statement made in a
Registration Statement or related Prospectus untrue in any material
respect or that requires the making of any changes in such Registration
Statement or Prospectus so that, in the case of a Registration Statement,
it will not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they
were made, not misleading, and that in the case of a Prospectus, it will
not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading;
(d) Use its best efforts to avoid the issuance of or, if issued,
obtain the withdrawal of any order enjoining or suspending the use of a
Prospectus or the effectiveness of a Registration Statement or the lifting
of any suspension of the qualification (or exemption from qualification)
of any of the Registrable Securities for sale in any jurisdiction
described in Section 4(h), at the earliest practicable moment;
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(e) If requested by the managing underwriters, if any, (i) promptly
incorporate in a Prospectus supplement or post-effective amendment such
information as the managing underwriters, if any, reasonably believe
should be included therein, and (ii) make all required filings of such
Prospectus supplement or such post-effective amendment under the
Securities Act as soon as practicable after the Company has received
notification 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
4(e) that would, in the opinion of counsel for the Company, violate
applicable law;
(f) Upon written request to the Company, furnish to each Holder of
Registrable Securities to be sold pursuant to a Registration Statement and
each managing underwriter, if any, without charge, at least one conformed
copy of such Registration Statement and each amendment thereto, including
financial statements and schedules, all documents incorporated or deemed
to be incorporated therein by reference, and all exhibits to the extent
requested (including those previously furnished or incorporated by
reference) as soon as practicable after the filing of such documents with
the SEC;
(g) Deliver to each Holder of Registrable Securities to be sold
pursuant to a Registration Statement, and the underwriters, if any,
without charge, as many copies of the Prospectus (including each form of
prospectus) and each amendment or supplement thereto as such persons
reasonably request; and the Company hereby consents to the use of such
Prospectus and each amendment or supplement thereto by each of the selling
holders of Registrable Securities and the underwriters, if any, in
connection with the offering and sale of the Registrable Securities
covered by such Prospectus and any amendment or supplement thereto;
(h) Prior to any public offering of Registrable Securities, use its
best efforts to register or qualify or cooperate with the Holders of
Registrable Securities to be sold, the underwriters, if any, and their
respective counsel in connection with the registration or qualification
(or exemption from such registration or qualification) of such Registrable
Securities for offer and sale under the securities or Blue Sky laws of
such jurisdictions as any such Holder or underwriter reasonably requests
in writing; keep each such registration or qualification (or exemption
therefrom) effective during the period such Registration Statement is
required to be kept effective hereunder and do any and all other acts or
things necessary or advisable to enable the disposition in such
jurisdictions of the Registrable Securities covered
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by the applicable Registration Statement; provided, however, that the
Company shall not be required to (i) qualify generally to do business in
any jurisdiction where it is not then so qualified or (ii) take any action
which would subject it to general service of process or to taxation in any
jurisdiction where they are not so subject;
(i) In connection with any sale or transfer of Registrable
Securities that will result in such securities no longer being Registrable
Securities, cooperate with the Holders thereof and the managing
underwriters, if any, to facilitate the timely preparation and delivery of
certificates representing Registrable Securities to be sold, which
certificates shall not bear any restrictive legends and shall be in a form
eligible for deposit with The Depository Trust Company and to enable such
Registrable Securities to be in such denominations and registered in such
names as the managing underwriters, if any, or such Holders may request at
least two Business Days prior to any sale of Registrable Securities;
(j) Upon the occurrence of any event contemplated by Section
4(c)(v), as promptly as practicable, prepare a supplement or amendment,
including, if appropriate, a post-effective amendment, to each
Registration Statement or a supplement to the related Prospectus or any
document incorporated or deemed to be incorporated therein by reference,
and file any other required document so that, as thereafter delivered,
such Prospectus will not contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which
they were made, not misleading;
(k) Enter into such agreements (including an underwriting agreement
in form, scope and substance as is customary in underwritten offerings)
and take all such other reasonable actions in connection therewith
(including those reasonably requested by the managing underwriters, if
any) in order to expedite or facilitate the disposition of such
Registrable Securities, and, whether or not an underwriting agreement is
entered into and whether or not the registration is an underwritten
registration, (i) make such representations and warranties to the
underwriters and selling Holders, if any, with respect to the business of
the Company and its subsidiaries (including with respect to businesses or
assets acquired or to be acquired by any of them), and the Registration
Statement, Prospectus and documents, if any, incorporated or deemed to be
incorporated by reference therein, in each case, in form, substance and
scope as are customarily made by issuers to underwriters in underwritten
offerings, and confirm the same if and when
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requested; (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 managing underwriters if any, addressed
to each of the underwriters, and selling Holders, if any), covering the
matters customarily covered in opinions requested in underwritten
offerings and such other matters as may be reasonably requested by such
underwriters or selling Holders; (iii) use their best efforts to obtain
customary "cold comfort" letters and updates thereof from the independent
certified public accountants of the Company (and, if necessary, any other
independent certified public accountants of any subsidiary of the Company
or of any business acquired by the Company for which financial statements
and financial data is, or is required to be, included in the Registration
Statement), addressed (where reasonably possible) to each of the
underwriters and selling Holders, if any, such letters to be in customary
form and covering matters of the type customarily covered in "cold
comfort" letters in connection with underwritten offerings; (iv) if an
underwriting agreement is entered into, the same shall contain
indemnification provisions and procedures no less favorable to the
underwriters, if any, than those set forth in Section 5 hereof (or such
other provisions and procedures acceptable to the managing underwriters,
if any); and (v) deliver such documents and certificates as may be
reasonably requested by the managing underwriters, if any, to evidence the
continued validity of the representations and warranties made pursuant to
clause (i) above and to evidence compliance with any customary conditions
contained in the underwriting agreement or other agreement entered into by
the Company;
(l) Make available for inspection by a representative of any
underwriter participating in any such disposition of Registrable
Securities, and any attorney, consultant or accountant retained by such
selling Holders or underwriter, at the offices where normally kept, during
reasonable business hours, all pertinent financial and other records,
corporate documents and properties of the Company and its subsidiaries
(including with respect to businesses and assets acquired or to be
acquired to the extent that such information is available to the Company),
and cause the officers, directors, agents and employees of the Company and
its subsidiaries (including with respect to businesses and assets acquired
or to be acquired to the extent that such information is available to the
Company) to supply all information in each case reasonably requested by
any such representative, underwriter, attorney, consultant or accountant
in connection with such Registration Statement; provided, however, that
such persons shall first agree in writing with the Company that any
information that is reasonably and in good faith
-31-
designated by the Company in writing as confidential at the time of
delivery of such information shall be kept confidential by such Persons,
unless (i) disclosure of such information is required by court or
administrative order or is necessary to respond to inquiries of regulatory
authorities, (ii) disclosure of such information is required by law
(including any disclosure requirements pursuant to Federal securities laws
in connection with the filing of the Registration Statement or the use of
any Prospectus), (iii) such information becomes generally available to the
public other than as a result of a disclosure or failure to safeguard such
information by such Person or (iv) such information becomes available to
such Person from a source other than the Company and its subsidiaries and
such source is not bound by a confidentiality agreement;
(m) Comply with all applicable rules and regulations of the SEC and
make generally available to their security-holders earnings statements
satisfying the provisions of Section 11(a) of the Securities Act and Rule
158 under the Securities Act, no later than 45 days after the end of any
12-month period (or 90 days after the end of any 12-month period if such
period is a fiscal year) (i) commencing at the end of any fiscal quarter
in which Registrable Securities are sold to underwriters in a firm
commitment or reasonable efforts underwritten offering and (ii) if not
sold to underwriters in such an offering, commencing on the first day of
the first fiscal quarter after the effective date of a Registration
Statement, which statement shall cover said period, consistent with the
requirements of Rule 158 under the Securities Act; and
(n) Cooperate with each seller of Registrable Securities covered by
any Registration Statement and each underwriter, if any, participating in
the disposition of such Registrable Securities and their respective
counsel in connection with any filings required to be made with the
National Association of Securities Dealers, Inc.
The Company may require a Holder of Registrable Securities to be
included in a Registration Statement to furnish to the Company such information
regarding (i) the intended method of distribution of such Registrable Securities
(ii) such Holder and (iii) the Registrable Securities held by such Holder as is
required by law to be disclosed in such Registration Statement and the Company
may exclude from such Registration Statement the Registrable Securities of any
Holder who unreasonably fails to furnish such information within a reasonable
time after receiving such request. The Company shall not be required to provide
indemnification to any Underwriter or any other person relating to information
referred to in clauses (i) and (ii) provided to the Company in
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writing specifically for inclusion in such Registration Statement.
If any such Registration Statement refers to any Holder by name or
otherwise as the Holder of any securities of the Company, then such Holder shall
have the right to require (i) the insertion therein of language, in form and
substance reasonably satisfactory to such Holder, to the effect that the holding
by such Holder of such securities is not to be construed as a recommendation by
such Holder of the investment quality of the Company's securities covered
thereby and that such holding does not imply that such Holder will assist in
meeting any future financial requirements of the Company, or (ii) in the event
that such reference to such Holder by name or otherwise is not required by the
Securities Act, the deletion of the reference to such Holder in any amendment or
supplement to the Registration Statement filed or prepared subsequent to the
time that such reference ceases to be required.
Each Holder of Registrable Securities agrees by acquisition of such
Registrable Securities that, upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 4(c)(ii), 4(c)(iii),
4(c)(iv) or 4(c)(v) hereof, such Holder will forthwith discontinue disposition
of such Registrable Securities covered by such Registration Statement or
Prospectus until such Holder's receipt of the copies of the supplemented or
amended Prospectus contemplated by Section 4(j) hereof, or until it is advised
in writing (the "Advice") by the Company that the use of the applicable
Prospectus may be resumed, and, in either case, has received copies of any
additional or supplemental filings that are incorporated or deemed to be
incorporated by reference in such Prospectus. If the Company shall give any such
notice, the Effectiveness Period shall be extended by the number of days during
such period from and including the date of the giving of such notice to and
including the date when each Holder of Registrable Securities covered by such
Registration Statement shall have received (x) the copies of the supplemented or
amended Prospectus contemplated by Section 4(j) hereof or (y) the Advice, and,
in either case, has received copies of any additional or supplemental filings
that are incorporated or deemed to be incorporated by reference in such
Prospectus.
5. Indemnification and Contribution.
(a) The Company shall indemnify and hold harmless each Initial
Purchaser, each Holder, each underwriter who participates in an offering of
Registrable Securities, their respective Affiliates, each Person, if any, who
controls any of such parties within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act and each of their respective directors,
officers, employees and agents, as follows:
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(i) from and against any and all loss, liability, claim, damage and
expense whatsoever, joint or several, as incurred, arising out of any
untrue statement or alleged untrue statement of a material fact contained
in any Registration Statement (or any amendment thereto), covering
Registrable Securities, including all documents incorporated therein by
reference, or the omission or alleged omission therefrom of a material
fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading or arising out of any untrue statement or alleged untrue
statement of a material fact contained in any Prospectus (or any amendment
or supplement thereto) or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
(ii) from and against any and all loss, liability, claim, damage and
expense whatsoever, joint or several, as incurred, to the extent of the
aggregate amount paid in settlement of any litigation, or any
investigation or proceeding by any court or governmental agency or body,
commenced or threatened, or of any claim whatsoever based upon any such
untrue statement or omission, or any such alleged untrue statement or
omission, if such settlement is effected with the prior written consent of
the Company; and
(iii) from and against any and all expenses whatsoever, as incurred
(including reasonable fees and disbursements of one counsel chosen by the
Initial Purchasers, and one counsel chosen by such Holders or any
underwriter (except to the extent otherwise expressly provided in Section
5(c) hereof)), reasonably incurred in investigating, preparing or
defending against any litigation, or any investigation or proceeding by
any court or governmental agency or body, commenced or threatened, or any
claim whatsoever based upon any such untrue statement or omission, or any
such alleged untrue statement or omission, to the extent that any such
expense is not paid under subparagraph (i) or (ii) of this Section 5(a);
provided that this indemnity does not apply to any loss, liability, claim,
damage or expense to the extent arising out of an untrue statement or omission
or alleged untrue statement or omission (i) made in reliance upon and in
conformity with written information furnished to the Company by an Initial
Purchaser, such Holder or any underwriter in writing expressly for use in the
Registration Statement (or any amendment thereto) or any Prospectus (or any
amendment or supplement thereto) or (ii) contained in any preliminary prospectus
if such Initial Purchaser, such Holder or such underwriter failed
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to send or deliver a copy of the Prospectus (in the form it was first provided
to such parties for confirmation of sales) to the Person asserting such losses,
claims, damages or liabilities on or prior to the delivery of written
confirmation of any sale of securities covered thereby to such Person in any
case where such delivery is required by the Securities Act and such Prospectus
would have corrected such untrue statement or omission. Any amounts advanced by
the Company to an indemnified party pursuant to this Section 5 as a result of
such losses shall be returned to the Company if it shall be finally determined
by such a court in a judgment not subject to appeal or final review that such
indemnified party was not entitled to indemnification by the Company.
(b) By accepting the benefits of this Agreement, each Holder agrees,
severally and not jointly, to indemnify and hold harmless the Company, each
Initial Purchaser, each underwriter who participates in an offering of
Registrable Securities and the other selling Holders and each of their
respective directors, officers (including each officer of the Company who signed
the Registration Statement), employees and agents and each Person, if any, who
controls the Company, an Initial Purchaser, any underwriter or any other selling
Holder within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act, from and against any and all loss, liability, claim, damage
and expense whatsoever described in the indemnity contained in Section 5(a)
hereof, as incurred, but only with respect to untrue statements or omissions, or
alleged untrue statements or omissions, made in the Registration Statement (or
any amendment thereto) or any Prospectus (or any amendment or supplement
thereto) in reliance upon and in conformity with written information furnished
to the Company by such selling Holder expressly for use in the Registration
Statement (or any amendment thereto), or any such Prospectus (or any amendment
or supplement thereto).
(c) Each indemnified party shall give prompt notice to each
indemnifying party of any action commenced against it in respect of which
indemnity may be sought hereunder, enclosing a copy of all papers properly
served on such indemnified party, but failure to so notify an indemnifying party
shall not relieve such indemnifying party from any liability which it may have
other than on account of this indemnity agreement. An indemnifying party may
participate at its own expense in the defense of any such action. If an
indemnifying party so elects within a reasonable time after receipt of such
notice, such indemnifying party, jointly with any other indemnifying party, may
assume the defense of such action with counsel chosen thereby and approved by
the indemnified parties defendant in such action, provided that if any such
indemnified party reasonably determines, based on advice of counsel, that there
may be legal defenses available to such indemnified party which are different
from or in addition to those available to such indemnifying party or that
-35-
representation of such indemnifying party and any indemnified party by the same
counsel would present a conflict of interest, then such indemnifying party or
parties shall not be entitled to assume such defense. If an indemnifying party
is not entitled to assume the defense of such action as a result of the proviso
to the preceding sentence, counsel for such indemnifying party shall be entitled
to conduct the defense of such indemnifying party and counsel for each
indemnified party or parties shall be entitled to conduct the defense of such
indemnified party or parties. If an indemnifying party assumes the defense of an
action in accordance with and as permitted by the provisions of this paragraph,
such indemnifying party shall not be liable for any fees and expenses of counsel
for the indemnified parties incurred thereafter in connection with such action.
In no event shall the indemnifying party or parties be liable for the fees and
expenses of more than one counsel (in addition to any local counsel), separate
from its own counsel, for all indemnified parties in connection with any one
action or separate but similar or related actions in the same jurisdiction
arising out of the same general allegations or circumstances.
(d) In order to provide for just and equitable contribution in
circumstances under which any of the indemnity provisions set forth in this
Section 5 is for any reason held to be unavailable to the indemnified parties
although applicable in accordance with its terms, the Company, each Initial
Purchaser and the Holders shall contribute to the aggregate losses, liabilities,
claims, damages and expenses of the nature contemplated by such indemnity
agreement incurred by the Company, the Initial Purchasers and the Holders, as
incurred; provided that 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 that was not guilty of such fraudulent
misrepresentation. As between the Company, the Initial Purchasers and the
Holders, such parties shall contribute to such aggregate losses, liabilities,
claims, damages and expenses of the nature contemplated by such indemnity
agreement in such proportion as shall be appropriate to reflect the relative
fault of the Company, on the one hand, and the Initial Purchasers and the
Holders, on the other hand, with respect to the statements or omissions which
resulted in such loss, liability, claim, damage or expense, or action in respect
thereof, as well as any other relevant equitable considerations. The relative
fault of the Company, on the one hand, and of the Initial Purchasers and the
Holders, on the other hand, shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company, on the one hand, or by or on behalf of an Initial
Purchaser or the Holders, on the other, and the parties' relative intent,
knowledge, access to information and opportunity to correct or
-36-
prevent such statement or omission. The Company, the Initial Purchasers and the
Holders of the Registrable Securities agree that it would not be just and
equitable if contribution pursuant to this Section 5 were to be determined by
pro rata allocation or by any other method of allocation that does not take into
account the relevant equitable considerations. For purposes of this Section 5,
each Affiliate of each Initial Purchaser or a Holder, and each director,
officer, employee, agent and Person, if any, who controls an Initial Purchaser
or Holder or such Affiliate within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act shall have the same rights to contribution
as such Initial Purchaser or Holder, and each director of the Company, each
officer of the Company who signed the Registration Statement, and each Person,
if any, who controls the Company within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act shall have the same rights to
contribution as the Company.
6. Rule 144A and Future IPOs
(a) The Company shall use its best efforts to file the reports
required to be filed by it under the Securities Act and the Exchange Act in a
timely manner and, if at any time it is not required to file such reports but in
the past had been required to or did file such reports, it will, upon the
request of any holder or beneficial owner of Registrable Securities, make
available other information as required by, and so long as necessary to permit,
sales of Registrable Securities pursuant to Rule 144A. Notwithstanding the
foregoing, nothing in this Section 6 shall be deemed to require the Company to
register any of its securities pursuant to the Exchange Act.
(b) The Company will agree not to make an Initial Public Equity
Offering of any class of Common Stock without amending, if necessary, the terms
of the Issuer's certificate of incorporation to provide that the Non-Voting
Common is convertible into such class of Common Stock on a share-for-share basis
and that the rights, conditions and privileges attaching to such class of Common
Stock are not adverse to holders of the Non-Voting Common as compared with the
terms of the shares of Class B Common (except with respect to voting rights).
7. Underwritten Registrations
If any of the Registrable Securities covered by any Registration
Statement are to be sold in an underwritten offering pursuant to Section 2.1,
the investment banker or investment bankers and manager or managers that will
administer the offering will be selected by the Company; provided that the
Holders of a majority of such Registrable Securities shall not have reasonably
objected to any such investment banker or manager.
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No Person may participate in any underwritten registration hereunder
unless such person (i) agrees to sell such Registrable Securities on the basis
reasonably provided in any underwriting arrangements approved by the Persons
entitled hereunder to approve such arrangements and (ii) completes and executes
all questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents required under the terms of such underwriting arrangements.
8. Miscellaneous
(a) Remedies. In the event of a breach by the Company, GVL, VPC or
by a holder of Shares of any of its obligations under this Agreement, each
holder of Shares, GVL, VPC and the Company, in addition to being entitled to
exercise all rights granted by law, including recovery of damages, will be
entitled to specific performance of its rights under this Agreement. The
Company, GVL, VPC and each holder of Shares agree that monetary damages would
not be adequate compensation for any loss incurred by reason of a breach of any
of the provisions of this Agreement and each hereby further agrees that, in the
event of any action for specific performance in respect of such breach, it shall
waive the defense that a remedy at law would be adequate.
(b) No Inconsistent Agreements. The Company, GVL and VPC will not
enter into any agreement that is inconsistent with the rights granted to the
holders of Shares and indemnified persons in this Agreement or otherwise
conflicts with the provisions hereof. Without the written consent of the holders
of a majority of the outstanding Shares, the Company, GVL and VPC shall not
grant to any Person any rights which conflict with or are inconsistent with the
provisions of this Agreement.
(c) 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, otherwise than with the prior written consent of the holders
of not less than a majority of the then outstanding Shares and/or Registrable
Securities, as applicable. Notwithstanding the foregoing, a waiver or consent to
depart from the provisions hereof with respect to a matter that relates
exclusively to the rights of Holders whose securities are being sold pursuant to
a Registration Statement and that does not directly or indirectly affect the
rights of other Holders may be given by Holders of a majority of the Registrable
Securities being sold by such Holders pursuant to such Registration Statement;
provided, however, that the provisions of this sentence may not be amended,
modified or supplemented except in accordance with the provisions of the
immediately preceding sentence. Notwithstanding the foregoing, no amendment,
modification, supplement, waiver or consent with respect to Section 5 shall
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be made or given otherwise than with the prior written consent of each Holder or
former Holder affected thereby.
(d) Notices. All notices and other communications provided for
herein shall be made in writing by hand-delivery, next-day air courier,
certified first-class mail, return receipt requested, telex or telecopier:
(i) if to the Company, as provided in the Purchase Agreement,
(ii) if to GVL or VPC
c/o Le Groupe Videotron Ltee
000 Xxxxx Xxxxxx Xxxx
Xxxxxxxx, Xxxxxx X0X 0X0
Attention: Senior Vice President Legal Affairs
(iii) if to the Initial Purchasers, as provided in the Purchase
Agreement, or
(iv) if to any other Person who is then the registered holder of
Shares or Registrable Securities, to the address of such holder as it
appears in the register therefor of the Company.
Except as otherwise provided in this Agreement, all such
communications shall be deemed to have been duly given: when delivered by hand,
if personally delivered; one Business Day after being timely delivered to a
next-day air courier; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; and when receipt is
acknowledged by the recipient's telecopier machine, if telecopied.
(e) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and permitted assigns of each of
the parties and shall inure to the benefit of each holder of Shares and
Registrable Securities. The Company may not assign any of its rights hereunder
without the prior written consent of each holder of Shares and Registrable
Securities, provided that a merger or consolidation of the Company with another
Person pursuant to which the issuer or issuers of any securities issued to
holders of Shares or Registrable Securities in connection with such merger or
consolidation becomes obligated under this Agreement and GVL and VPC confirm
their agreements with respect to the securities of such issuer or issuers shall
not be considered an assignment. Notwithstanding the foregoing, no successor or
assignee of the Company shall have any of the rights granted under this
Agreement until such Person shall acknowledge its rights and obligations
hereunder by a signed written statement of such person's acceptance of such
rights and obligations. If any transferee of any holder shall acquire Shares or
-39-
Registrable Securities, in any manner, whether by operation of law or otherwise,
such Shares or Registrable Securities shall be held subject to all of the terms
of this Agreement, and by taking and holding such Shares or Registrable
Securities such person shall be conclusively deemed to have agreed to be bound
by and to perform all of the terms and provisions of this Agreement and such
person shall be entitled to receive the benefits hereof.
(f) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and, all of which taken
together shall constitute one and the same Agreement.
(g) Governing Law; Submission to Jurisdiction. THIS AGREEMENT SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK.
THE COMPANY, GVL, VPC AND THE INITIAL PURCHASERS HEREBY IRREVOCABLY SUBMIT TO
THE JURISDICTION OF ANY NEW YORK STATE COURT SITTING IN THE BOROUGH OF MANHATTAN
IN THE CITY OF NEW YORK OR ANY FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN
IN THE CITY OF NEW YORK IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT
OF OR RELATING TO THIS AGREEMENT, AND EACH IRREVOCABLY ACCEPTS FOR ITSELF AND IN
RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, JURISDICTION OF THE
AFORESAID COURTS.
(h) Severability. The remedies provided herein are cumulative and
not exclusive of any remedies provided by law. If any term, provision, covenant
or restriction of this Agreement is held by a court of competent jurisdiction to
be invalid, illegal, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions set forth herein shall remain in full
force and effect and shall in no way be affected, impaired or invalidated, and
the parties hereto shall use their reasonable efforts to find and employ an
alternative means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction. It is hereby
stipulated and declared to be the intention of the parties that they would have
executed the remaining terms, provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid, illegal, void or
unenforceable.
(i) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof. All
references made in this Agreement to "Section" and "paragraph" refer to such
Section or paragraph of this Agreement, unless expressly stated otherwise.
-40-
IN WITNESS WHEREOF, the parties have caused this Registration Rights
Agreement to be duly executed as of the date first written above.
OPTEL, INC.
By: _____________________________
Name:
Title:
By: _____________________________
Name:
Title:
LE GROUPE VIDEOTRON LTEE.
By:______________________________
Name:
Title:
VPC CORPORATION
By:______________________________
Name:
Title:
SALOMON BROTHERS INC
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX,
INCORPORATED
By: Salomon Brothers Inc
------------------------------
By:_______________________________
Name:
Title:
U.S. TRUST COMPANY OF TEXAS, N.A.,
as transfer agent
By:_______________________________
Name:
Title:
-41-
EXHIBIT A
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE OR
OTHER SECURITIES LAWS. NEITHER THIS SECURITY NOR ANY INTEREST OR
PARTICIPATION HEREIN MAY BE REOFFERED, SOLD, ASSIGNED, TRANSFERRED,
PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF SUCH
REGISTRATION OR UNLESS SUCH TRANSACTION IS EXEMPT FROM, OR NOT SUBJECT TO,
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE HOLDER OF THIS
SECURITY BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT (A) IT IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE
SECURITIES ACT) OR (B) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS
DEFINED IN RULE 501(a)(1), (2), (3,) OR (7) UNDER THE SECURITIES ACT) (AN
"INSTITUTIONAL ACCREDITED INVESTOR") OR (C) IT IS NOT A U.S. PERSON AND IS
ACQUIRING THIS SECURITY IN AN "OFFSHORE TRANSACTION" PURSUANT TO
REGULATION S, (2) AGREES THAT IT WILL NOT PRIOR TO (X) THE DATE WHICH IS
THREE YEARS (OR SUCH SHORTER PERIOD AS MAY BE PRESCRIBED BY RULE 144(K)
(OR ANY SUCCESSOR PROVISION THEREOF) UNDER THE SECURITIES ACT) AFTER THE
LATER OF THE ORIGINAL ISSUE DATE HEREOF (OR OF ANY PREDECESSOR OF THIS
SECURITY) OR THE LAST DAY ON WHICH THE COMPANY OR ANY AFFILIATE OF THE
COMPANY WAS THE OWNER OF THIS SECURITY OR ANY PREDECESSOR OF THIS SECURITY
AND (Y) SUCH LATER DATE, IF ANY, AS MAY BE REQUIRED BY APPLICABLE LAWS
(THE "RESALE RESTRICTION TERMINATION DATE"), OFFER, SELL OR OTHERWISE
TRANSFER THIS SECURITY EXCEPT (A) TO THE ISSUER OR ANY OF ITS
SUBSIDIARIES, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN
DECLARED EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE
SECURITIES ARE ELIGIBLE FOR RESALE PURSUANT TO RULE 000X XXXXXX XXX XXXXXX
XXXXXX, TO A PERSON IT REASONABLY BELIEVES IS A "QUALIFIED INSTITUTIONAL
BUYER" AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT THAT PURCHASES FOR
ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED INSTITUTIONAL BUYER TO
WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE IN RELIANCE ON RULE
144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS THAT OCCUR
OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE
SECURITIES ACT, PURSUANT TO RULE 904 OF REGULATION S, (E) TO AN
INSTITUTIONAL ACCREDITED INVESTOR THAT IS ACQUIRING THE SECURITIES FOR ITS
OWN ACCOUNT, OR FOR THE ACCOUNT OF SUCH AN INSTITUTIONAL ACCREDITED
INVESTOR, FOR INVESTMENT PURPOSES AND NOT WITH A VIEW TO, OR FOR OFFER OR
SALE IN CONNECTION WITH, ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES
ACT, OR (F) PURSUANT TO ANOTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT, (3) AGREES THAT IT SHALL BE BOUND, TO
THE EXTENT APPLICABLE, BY THE TERMS OF THE COMMON STOCK REGISTRATION
RIGHTS AGREEMENT DATED AS OF FEBRUARY 14, 1997 AND (4) AGREES THAT IT WILL
GIVE TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE
SUBSTANTIALLY TO THE EFFECT OF
A-1
THIS LEGEND. THIS LEGEND WILL BE REMOVED UPON THE REQUEST OF THE HOLDER
AFTER THE RESALE RESTRICTION TERMINATION DATE. AS USED HEREIN, THE TERMS
"OFFSHORE TRANSACTION," "UNITED STATES" AND "U.S. PERSON" HAVE THE
RESPECTIVE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES
ACT.
A-2
EXHIBIT B
FORM OF LEGEND FOR GLOBAL CERTIFICATE
Any Global Certificate authenticated and delivered hereunder shall
bear a legend in substantially the following form:
THIS SECURITY IS A GLOBAL CERTIFICATE WITHIN THE MEANING OF THE
COMMON STOCK REGISTRATION RIGHTS AGREEMENT HEREINAFTER REFERRED TO AND IS
REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE OF A DEPOSITORY OR A
SUCCESSOR DEPOSITORY. THIS SECURITY IS NOT EXCHANGEABLE FOR SECURITIES
REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITORY OR ITS
NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE COMMON STOCK
REGISTRATION RIGHTS AGREEMENT, AND NO TRANSFER OF THIS SECURITY (OTHER
THAN A TRANSFER OF THIS SECURITY AS A WHOLE BY THE DEPOSITORY TO A NOMINEE
OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR
ANOTHER NOMINEE OF THE DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE LIMITED
CIRCUMSTANCES DESCRIBED IN THE COMMON STOCK REGISTRATION RIGHTS AGREEMENT.
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE
OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO ISSUER
OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY
CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY
PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY
AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE
HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
B-1
EXHIBIT C
CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR
REGISTRATION OF TRANSFER OF NON-VOTING COMMON STOCK
Re: Class C Common Stock (the "Common Stock")
of OPTEL, INC.
This Certificate relates to ____ Common Stock held in* ___
book-entry or* _______ certificated form by ______ (the "Transferor").
The Transferor:*
/ / has requested the Transfer Agent by written order to deliver in
exchange for its beneficial interest in the Global Certificate held by the
Depositary, Common Stock in definitive, registered form of authorized
denominations and an aggregate number equal to its beneficial interest in such
Global Certificate (or the portion thereof indicated above); or
/ / has requested the Transfer Agent by written order to exchange or
register the transfer of Common Stock.
In connection with such request and in respect of such Common Stock,
the Transferor does hereby certify that Transferor is familiar with the Common
Stock Registration Rights Agreement relating to the above captioned Common Stock
and the restrictions on transfers thereof as provided in Section 3.5 of such
Common Stock Registration Rights Agreement, and that the transfer of this Common
Stock does not require registration under the Securities Act of 1933, as amended
(the "Act") because[*]:
/ / Such Common Stock is being acquired for the Transferor's own account,
without transfer (in satisfaction of Section 3.5(_) of the Common Stock
Registration Rights Agreement).
/ / Such Common Stock is being transferred to a qualified institutional
buyer (as defined in Rule 144A under the Act), in reliance on Rule 144A.
/ / Such Common Stock is being transferred to an institutional "accredited
investor" (within the meaning of subparagraphs (a)(1), (2), (3) or (7) of Rule
501 under the Act).
/ / Such Common Stock is being transferred in reliance on Regulation S
under the Act.
/ / Such Common Stock is being transferred in accordance with Rule 144
under the Act.
C-1
/ / Such Common Stock is being transferred in reliance on and in
compliance with an exemption from the registration requirements of the Act.
------------------------------
[INSERT NAME OF TRANSFEROR]
By: _________________________
Date: _________________
*Check applicable box.
C-2
EXHIBIT D
Form of Certificate to Be
Delivered in Connection with
Transfers to Institutional Accredited Investors
-------------, ----
U.S. Trust Company of Texas, N.A.
0000 Xxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Corporate Trust Department
Ladies and Gentlemen:
In connection with our proposed purchase of Class C Common Stock
(the "Common Stock") of Optel, Inc. (the "Company"), we confirm that:
(i) We have received such information as we deem necessary in order
to make our investment decision.
(ii) We understand that any subsequent transfer of the Common Stock
is subject to certain restrictions and conditions set forth in the Common Stock
Registration Rights Agreement and the undersigned agrees to be bound by, and not
to resell, pledge or otherwise transfer the Common Stock except in compliance
with, such restrictions and conditions and the Securities Act of 1933, as
amended (the "Securities Act").
(iii) We understand that the offer and sale of the Common Stock has
not been registered under the Securities Act, and that the Common Stock may not
be offered or sold within the United States or to, or for the account or benefit
of, U.S. persons except as permitted in the following sentence. We agree, on our
own behalf and on behalf of any accounts for which we are acting as hereinafter
stated, that if we should sell any Common Stock prior to (x) the date which is
three years after the later of the date of original issuance of the Common Stock
(or such shorter period as may be prescribed by Rule 144(k) under the Securities
Act or any successor provision thereto) or the last day on which the Company or
any affiliate of the Company was owner of such Common Stock, or any predecessor
thereto, and (y) such later date, if any, as may be required by applicable laws,
we will do so only (A) to the Company, (B) inside the United States in
accordance with Rule 144A under the Securities Act to a "qualified institutional
buyer" (as defined therein), (C) inside the United States to an institutional
"accredited investor" (as defined below) that, prior to such transfer, furnishes
(or has furnished on its behalf by a U.S. broker-dealer) to the Transfer Agent a
signed letter substantially in the form hereof, (D) outside the United States in
accordance with Regulation S under the Securities
D-1
Act, (E) pursuant to the exemption from registration provided by Rule 144 under
the Securities Act (if available) or (F) pursuant to an effective registration
statement under the Securities Act and (G) pursuant to another available
exemption under the Securities Act, and we further agree to provide to any
person purchasing Common Stock from us a notice advising such purchaser that
resales of the Common Stock is restricted as stated herein.
(iv) We understand that, on any proposed resale of Common Stock, we
will be required to furnish to the Transfer Agent and the Company, such
certification, legal opinions and other information as the Transfer Agent and
the Company may reasonably require to confirm that the proposed sale complies
with the foregoing restrictions. We further understand that the Common Stock
purchased by us will bear a legend to the foregoing effect.
(v) We are an institutional "accredited investor" (as defined in
Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and
have such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of our investment in the Common
Stock, and we and any accounts for which we are acting are each able to bear the
economic risk of our or their investment, as the case may be.
(vi) We are acquiring the Common Stock purchased by us for our
account or for one or more accounts (each of which is an institutional
"accredited investor") as to each of which we exercise sole investment
discretion.
You and the Company and any counsel to the Company are entitled to
rely upon this letter and are irrevocably authorized to produce this letter or a
copy hereof to any interested party in any administrative or legal proceeding or
official inquiry with respect to the matters covered hereby.
Very truly yours,
[Name of Transferee]
By:____________________________
[Authorized Signatory]
Upon transfer the Common Stock would be registered in the name of
the new beneficial owner as follows:
Name:______________________________
Address:___________________________
Taxpayer ID Number:________________
D-2
EXHIBIT E
Form of Certificate to Be
Delivered in Connection
with Regulation S Transfers
---------------, ----
U.S. Trust Company of Texas, N.A.
0000 Xxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Corporate Trust Department
Ladies and Gentlemen:
In connection with our proposed sale of Class C Common Stock
("Common Stock") of Optel, Inc. (the "Company"), we confirm that such sale has
been effected pursuant to and in accordance with Regulation S under the
Securities Act of 1933, as amended (the "Securities Act"), and, accordingly, we
represent that:
(1) the offer of the Common Stock was not made to a person in the
United States;
(2) either (a) at the time the buy offer was originated, the
transferee was outside the United States or we and any person acting on
our behalf reasonably believed that the transferee was outside the United
States, or (b) the transaction was executed in, on or through the
facilities of a designated off-shore securities market and neither we nor
any person acting on our behalf knows that the transaction has been
pre-arranged with a buyer in the United States;
(3) no directed selling efforts have been made in the United States
in contravention of the requirements of Rule 903(b) or Rule 904(b) of
Regulation S under the Securities Act, as applicable;
(4) the transaction is not part of a plan or scheme to evade the
registration requirements of the Securities Act;
(5) we have advised the transferee of the transfer restrictions
applicable to the Common Stock; and
(6) if the circumstances set forth in Rule 904(c) under the
Securities Act are applicable, we have complied with the additional
conditions therein, including (if applicable) sending a confirmation or
other notice stating that the Common Stock may be offered and sold during
the restricted period specified in Rule 903(c)(2) or (3), as applicable,
in accordance with the provisions of
E-1
Regulation S; pursuant to registration of the Common Stock under the
Securities Act; or pursuant to an available exemption from the
registration requirements under the Act.
You and the Company and any counsel to the Company are entitled to
rely upon this letter and are irrevocably authorized to produce this letter or a
copy hereof to any interested party in any administrative or legal proceedings
or official inquiry with respect to the matters covered hereby. Defined terms
used herein without definition have the respective meanings provided in
Regulation S under the Securities Act.
Very truly yours,
[Name of Transferor]
By:________________________________
[Authorized Signature]
Upon transfer the Common Stock would be registered in the name of
the new beneficial owner as follows:
Name:______________________________
Address:___________________________
Taxpayer ID Number:________________
E-2
