EXHIBIT 10.3
REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made and entered
into as of April 19, 2001, by and among DELHAIZE AMERICA, INC., a North Carolina
corporation (the "Company"), FOOD LION, LLC, a North Carolina limited liability
company (the "Guarantor"), and XXXXXXX XXXXX XXXXXX INC., XXXXX SECURITIES INC.
and DEUTSCHE BANC ALEX. XXXXX, INC., in their respective capacities as initial
purchasers and as representatives of each of the other initial purchasers named
in Schedule I to the Purchase Agreement referred to below (collectively, the
"Initial Purchasers").
This Agreement is made pursuant to the Purchase Agreement dated April 11,
2001, by and among the Company, the Guarantor and the Initial Purchasers (the
"Purchase Agreement"), which provides for the sale by the Company to the Initial
Purchasers of $600,000,000 aggregate principal amount of the its 7.375% Notes
due 2006 (the "7.375% Notes"), $1,100,000,000 aggregate principal amount of the
Company's 8.125% Notes due 2011 (the "8.125% Notes") and $900,000,000 aggregate
principal amount of the Company's 9.000% Debentures due 2031 (the "Debentures"
and, together with the 7.375% Notes and the 8.125% Notes, the "Debt
Securities"). The Debt Securities will be fully and unconditionally guaranteed
(the "Guarantee") as to payment of principal, premium, if any, and interest by
the Guarantor. The Debt Securities, as guaranteed by the Guarantor, are referred
to herein as the "Securities." References to Securities, Exchange Securities (as
defined herein) and Registrable Securities (as defined herein) will be
identically applicable to each of the series of Securities unless otherwise
indicated herein.
In order to induce the Initial Purchasers to enter into the Purchase
Agreement and in satisfaction of a condition to the Initial Purchasers'
obligations thereunder, the Company and the Guarantor have agreed to provide to
the Initial Purchasers and their respective direct and indirect transferees and
assigns the registration rights set forth in this 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:
"Affiliate" shall mean a person that directly, or indirectly through
one or more intermediaries, controls or is controlled by, or is under
common control with, a specified person. "Control," whether used as a noun
or a verb, refers to the possession, directly or indirectly, of the power
to direct, or cause the direction of, the management and policies of a
Person, whether through the ownership of voting securities, by contract or
otherwise.
"Agreement" shall have the meaning set forth in the preamble of this
Agreement.
"Closing Date" shall mean the Closing Date as defined in the Purchase
Agreement.
"Company" shall have the meaning set forth in the preamble and also
includes the Company's successors.
"Depositary" shall mean The Depository Trust Company, or any other
depositary appointed by the Company, including any agent thereof; provided,
however, that any such depositary must at all times have an address in the
Borough of Manhattan, in The City of New York.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time, and the rules and regulations of the SEC
promulgated thereunder.
"Exchange Securities" shall mean the 7.375% Notes due 2006, the 8.125%
Notes due 2011 and the 9.000% Debentures due 2031 issued by the Company
under the Indenture and the related Guarantee containing terms identical to
the Registrable Securities (except that (i) interest thereon shall accrue
from the last date on which interest was paid on the Registrable Securities
or, if no such interest has been paid, from the Closing Date, (ii) the
transfer restrictions thereon shall be eliminated and (iii) certain
provisions relating to an increase in the stated rate of interest thereon
shall be eliminated) which are to be offered to Holders of Registrable
Securities in exchange for Registrable Securities pursuant to the Exchange
Offer.
"Exchange Offer" shall mean the exchange offer by the Company and the
Guarantor of Exchange Securities for Registrable Securities pursuant to
Section 2(a) hereof.
"Exchange Offer Registration" shall mean a registration under the
Securities Act effected pursuant to Section 2(a) hereof.
"Exchange Offer Registration Statement" shall mean an exchange offer
registration statement on Form S-4 covering the Registrable Securities (or,
if applicable, on another appropriate form), and all amendments and
supplements to such registration statement, in each case including the
Prospectus contained therein, all exhibits thereto and all material
incorporated by reference therein.
"Guarantee" shall have the meaning set forth in the preamble of this
Agreement.
"Guarantor" shall have the meaning set forth in the preamble of this
Agreement.
"Holders" shall mean the Initial Purchasers, for so long as they own
any Registrable Securities, and each of their respective successors,
assigns and direct and indirect transferees who become
2
registered owners of Registrable Securities under the Indenture.
"Indenture" shall mean the Indenture dated as of April 15, 2001, as
supplemented by the First Supplemental Indenture, dated as of April 19,
2001 among the Company, the Subsidiary Guarantor and The Bank of New York,
as Trustee, relating to the Securities and the Exchange Securities and as
the same may be amended or supplemented or modified from time to time in
accordance with the terms thereof.
"Initial Purchasers" shall have the meaning set forth in the preamble
of this Agreement.
"Majority Holders" shall mean the Holders of a majority of the
aggregate principal amount of Registrable Securities outstanding; provided
that whenever the consent or approval of Holders of a specified percentage
of Registrable Securities is required hereunder, Registrable Securities
held by the Company, the Guarantor or any of their respective Affiliates
(other than the Initial Purchasers or subsequent holders of Registrable
Securities), if such subsequent holders are deemed to be such Affiliates
solely by reason of their holding of such Registrable Securities, shall be
disregarded in determining whether such consent or approval was given by
the Holders of such required percentage or amount.
"NASD" shall mean the National Association of Securities Dealers, Inc.
"Participating Broker-Dealer" shall have the meaning set forth in
Section 3(f).
"Person" shall mean an individual, partnership, joint venture, limited
liability company, corporation, trust or unincorporated organization, or a
government or agency or political subdivision thereof.
"Prospectus" shall mean the prospectus included in a Registration
Statement, including any preliminary prospectus, and any such prospectus as
amended or supplemented by any prospectus supplement, including a
prospectus supplement with respect to the terms of the offering of any
portion of the Registrable Securities covered by a Shelf Registration
Statement, and by all other amendments and supplements to a prospectus,
including post-effective amendments, and in each case including all
material incorporated by reference therein.
"Purchase Agreement" shall have the meaning set forth in the preamble
of this Agreement.
"Registrable Securities" shall mean the Securities; provided, however,
that the Securities shall cease to be Registrable Securities when (i) a
Registration Statement with respect to such Securities shall have been
declared effective under the Securities Act and such Securities shall have
been disposed of pursuant to such Registration Statement, (ii) such
Securities shall have been sold to the public pursuant
3
to Rule 144 (or any similar provision then in force, but not Rule 144A)
under the Securities Act, (iii) such Securities shall have ceased to be
outstanding or (iv) such Securities have been exchanged for Exchange
Securities upon consummation of the Exchange Offer.
"Registration Default" shall have the meaning set forth in Section
2(e) of this Agreement.
"Registration Expenses" shall mean any and all expenses incident to
performance of or compliance by the Company and the Guarantor with this
Agreement, including without limitation: (i) all SEC, stock exchange or
NASD registration and filing fees, (ii) all fees and expenses incurred in
connection with compliance with state or other securities or blue sky laws
and compliance with the rules of the NASD (including reasonable fees and
disbursements of counsel for any underwriters or Holders in connection with
state or other securities or blue sky qualification of any of the Exchange
Securities or Registrable Securities, which shall not exceed $5,000), (iii)
all expenses of any Persons in preparing, printing and distributing any
Registration Statement, any Prospectus, any amendments or supplements
thereto, any underwriting agreements, securities sales agreements,
certificates representing the Exchange Securities and other documents
relating to the performance of and compliance with this Agreement, (iv) all
rating agency fees, (v) all fees and expenses incurred in connection with
the listing, if any, of any of the Exchange Securities or such Registrable
Securities, covered by a Shelf Registration Statement, as applicable, on
any securities exchange or exchanges, (vi) all fees and disbursements
relating to the qualification of the Indenture under applicable securities
laws, (vii) the fees and disbursements of counsel for the Company and the
Guarantor and the fees and expenses of the independent public accountants
of the Company and the Guarantor, including the expenses of any special
audits or "cold comfort" letters required by or incident to such
performance and compliance, (viii) the fees and expenses of a "qualified
independent underwriter" as defined by Conduct Rule 2720 of the NASD (if
required by the NASD rules) in connection with the offering of the
Registrable Securities and the reasonable fees and expenses of its counsel,
(ix) the reasonable fees and expenses of the Trustee, any registrar, any
depositary and paying agent, including their respective counsel, and any
escrow agent or custodian, (x) the reasonable fees and expenses of the
Initial Purchasers in connection with the Exchange Offer, including the
reasonable fees and expenses of counsel to the Initial Purchasers, (xi) the
reasonable fees and expenses of one counsel to the Holders which shall be
Xxxxx, Xxxxx & Xxxxx in connection with the Shelf Registration Statement,
and (xii) in the case of an underwritten offering, any reasonable fees and
disbursements of the underwriters customarily required to be paid by
issuers or sellers of such securities, including the reasonable fees and
expenses of one counsel to the underwriters, and the fees and expenses of
any special experts retained by the Company and the Guarantor in connection
with any Registration Statement but excluding (except as otherwise provided
herein) the reasonable fees of counsel to the underwriters or the Holders
and underwriting.
"Registration Statement" shall mean any registration statement of the
Company and the Guarantor relating to any offering of the Exchange
Securities or Registrable Securities pursuant to the provisions of this
Agreement, and all amendments and supplements to any such Registration
Statement,
4
including post-effective amendments, in each case including the Prospectus
contained therein, all exhibits thereto and all material incorporated by
reference therein.
"SEC" shall mean the U.S. Securities and Exchange Commission. ---
"Securities" shall have the meaning set forth in the preamble of this
Agreement.
"Securities Act" shall mean the Securities Act of 1933, as amended
from time to time, and the rules and regulations of the SEC promulgated
thereunder.
"Share Exchange Agreement" shall have the meaning set forth in the
preamble of this Agreement.
"Shelf Registration" shall mean a registration effected pursuant to
Section 2(b) hereof.
"Shelf Registration Statement" shall mean a "shelf" registration
statement of the Company and the Guarantor pursuant to the provisions of
Section 2(b) of this Agreement which covers all of the Registrable
Securities on an appropriate form under Rule 415 under the Securities Act,
or any similar rule that may be adopted by the SEC, and all amendments and
supplements to such registration statement, including post-effective
amendments, in each case including the Prospectus contained therein, all
exhibits thereto and all material incorporated by reference therein.
"Trustee" shall mean the trustee under the Indenture.
2. Registration Under the Securities Act.
(a) Exchange Offer Registration. To the extent not prohibited by any
applicable law or applicable interpretation of the staff of the SEC, the
Company and the Guarantor shall (A) file with the SEC within 150 calendar
days after the Closing Date, an Exchange Offer Registration Statement
covering the offer by the Company to the Holders to exchange all of the
Registrable Securities for Exchange Securities, (B) use its reasonable best
efforts to cause such Exchange Offer Registration Statement to be declared
effective by the SEC within 210 calendar days after the Closing Date, (C)
use its reasonable best efforts to cause such Registration Statement to
remain effective until the closing of the Exchange Offer and (D) use its
reasonable best efforts to consummate the Exchange Offer within 240
calendar days after the Closing Date. The Exchange Securities will be
issued under the Indenture. Upon the effectiveness of the Exchange Offer
Registration Statement, the Company and the Guarantor shall promptly
commence the Exchange Offer, it being the objective of such Exchange Offer
to enable each Holder (other than Participating Broker-Dealers eligible and
electing to exchange Registrable Securities for Exchange Securities
(assuming that such Holder is not an Affiliate of the Company or the
Guarantor, acquires the Exchange Securities in the ordinary course of such
Holder's business and has
5
no arrangements or understandings with any person to participate in the
Exchange Offer for the purpose of distributing the Exchange Securities) to
trade such Exchange Securities from and after their receipt without any
limitations or restrictions under the Securities Act and without material
restrictions under the securities laws of a substantial proportion of the
several states of the United States.
In connection with the Exchange Offer, the Company and the Guarantor
shall:
(i) mail to each Holder a copy of the Prospectus forming part of
the Exchange Offer Registration Statement, together with an
appropriate letter of transmittal and related documents;
(ii) keep the Exchange Offer open for not less than 20 business
days (or longer if required by applicable federal and state securities
laws) after the date notice thereof is mailed to the Holders;
(iii) use the services of the Depositary for the Exchange Offer
with respect to Securities evidenced by global certificates;
(iv) permit Holders to withdraw tendered Registrable Securities
at any time prior to 5:00 p.m., New York City time, on the last
business day on which the Exchange Offer shall remain open, by sending
to the institution specified in the notice, a telegram, telex,
facsimile transmission or letter setting forth the name of such
Holder, the principal amount of Registrable Securities delivered for
exchange, and a statement that such Holder is withdrawing its election
to have such Securities exchanged; and
(v) otherwise comply in all material respects with all applicable
federal and state securities laws relating to the Exchange Offer.
As soon as practicable after the close of the Exchange Offer, the
Company and the Guarantor shall:
(i) accept for exchange Registrable Securities duly tendered and
not validly withdrawn pursuant to the Exchange Offer in accordance
with the terms of the Exchange Offer Registration Statement and the
letter of transmittal which is an exhibit thereto;
(ii) deliver, or cause to be delivered, to the Trustee for
cancellation all Registrable Securities so accepted for exchange by
the Company and the Guarantor; and
(iii) use its best efforts to cause the Trustee to promptly
authenticate and deliver Exchange Securities to each Holder of
Registrable Securities equal in principal amount to the
6
principal amount of the Registrable Securities of such Holder so
accepted for exchange.
Interest on each Exchange Security will accrue from the last date on
which interest was paid on the Registrable Securities surrendered in
exchange therefor or, if no interest has been paid on the Registrable
Securities, from the Closing Date. The Exchange Offer shall not be subject
to any conditions, other than (i) that the Exchange Offer, or the making of
any exchange by a Holder, does not violate applicable law or any applicable
interpretation of the staff of the SEC, (ii) that no action or proceeding
shall have been instituted or threatened in any court or before any
governmental agency with respect to the Exchange Offer which, in the
judgment of the Company or the Guarantor, would reasonably be expected to
impair the ability of the Company and the Guarantor to proceed with the
Exchange Offer, (iii) that no law, rule or regulation or applicable
interpretations of the staff of the SEC has been issued or promulgated
which, in the good faith determination of the Company or the Guarantor,
does not permit the Company and the Guarantor to effect the Exchange Offer
and (iv) that the Holders tender the Registrable Securities to the Company
in accordance with the Exchange Offer.
As a condition to participating in the Exchange Offer, each Holder of
Registrable Securities (other than Participating Broker-Dealers) who wishes
to exchange such Registrable Securities for Exchange Securities in the
Exchange Offer shall have represented in writing to the Company that at the
time of consummation of the Exchange Offer (i) it is not an Affiliate of
the Company or the Guarantor or, if it is an Affiliate, it will comply with
the registration and prospectus delivery requirements of the Securities
Act, to the extent applicable, (ii) any Exchange Securities to be received
by it will be acquired in the ordinary course of business, (iii) at the
time of the commencement of the Exchange Offer, it has no arrangement or
understanding with any Person to participate in the distribution (within
the meaning of the Securities Act) of the Securities or the Exchange
Securities, (iv) it is not acting on behalf of any person who could not
truthfully make the foregoing representations and (v) it shall have made
such other representations as may be reasonably necessary under applicable
SEC rules, regulations or interpretations to render the use of Form S-4 or
another appropriate form under the Securities Act available or for the
Exchange Offer Registration Statement to be declared effective. To the
extent permitted by law, the Company and the Guarantor shall inform the
Initial Purchasers of the names and addresses of the Holders to whom the
Exchange Offer is made and the Initial Purchasers shall have the right to
contact such Holders and otherwise facilitate the tender of Registrable
Securities in the Exchange Offer.
(b) Shelf Registration.
(i) If, because of any change in law or currently prevailing
applicable interpretations thereof by the staff of the SEC, the
Company and the Guarantor are not permitted to effect the
Exchange Offer as contemplated by Section 2(a) hereof, (ii) if
for any other reason the Exchange Offer Registration Statement is
not declared effective within 210 calendar days following the
Closing Date or the Exchange Offer is not consummated within 240
7
calendar days after the Closing Date (provided that, if the
Exchange Offer Registration Statement shall be declared effective
after such 210-day period or if the Exchange Offer shall be
consummated after such 240-day period, then the Company's and the
Guarantor's obligations under this clause (ii) arising from the
failure of the Exchange Offer Registration Statement to be
declared effective within such 210-day period or the failure of
the Exchange Offer to be consummated within such 240-day period,
respectively, shall terminate), (iii) if any Holder (other than
an Initial Purchaser) is not eligible to participate in the
Exchange Offer or elects to participate in the Exchange Offer but
does not receive freely tradeable Exchange Securities pursuant to
the Exchange Offer or (iv) upon the written request of any of the
Initial Purchasers within 90 days following the consummation of
the Exchange Offer with respect to Registrable Securities that
are not permitted to be exchanged for Exchange Securities in the
Exchange Offer or the Initial Purchasers do not receive freely
tradable Exchange Securities in the Exchange Offer in the
reasonable opinion of counsel to such Initial Purchaser, pursuant
to applicable law or applicable interpretation of the staff of
the SEC; then, in the case of each of clauses (i) through (iv),
the Company or the Guarantor shall, at its cost:
(A) as promptly as practicable, but no later than (a)
the 210th calendar day after the Closing Date or (b) the
30th calendar day after such filing obligations arises,
whichever is later, file with the SEC a Shelf Registration
Statement relating to the offer and sale of the Registrable
Securities by the Holders from time to time in accordance
with the methods of distribution elected by the Majority
Holders of such Registrable Securities and set forth in such
Shelf Registration Statement; provided, that no Holder shall
be entitled to have Registrable Securities held by it
included in the Shelf Registration Statement unless such
Holder agrees in writing to be bound by all of the
provisions of this Agreement applicable to the Holder and
furnishes to the Company in writing such information as the
Company may reasonably request for inclusion in the Shelf
Registration Statement or any Prospectus included therein;
(B) use their reasonable best efforts to cause such
Shelf Registration Statement to be declared effective by the
SEC as promptly as practicable, but in no event later than
the 240th calendar day after the Closing Date (or within 60
calendar days of a request of any Initial Purchaser);
provided that, with respect to Exchange Securities received
by a broker-dealer in exchange for any securities that were
acquired by such broker-dealer as a result of market-making
or other trading activities, the Company and the Guarantor
may, if permitted by current interpretations by the staff of
the SEC, file a post-effective amendment to the Exchange
Offer Registration Statement containing the information
required by Regulation S-K Items 507 and/or 508, as
applicable, in satisfaction of its obligations under
paragraph (A) solely with respect to Participating
Broker-Dealers who acquired their Securities as a result of
market-making or other trading activities, and any such
Exchange Offer Registration
8
Statement, as so amended, shall be referred to herein as,
and governed by the provisions herein applicable to, a Shelf
Registration Statement. In the event that the Company and
the Guarantor are required to file a Shelf Registration
Statement upon the request of any Holder (other than an
Initial Purchaser) not eligible to participate in the
Exchange Offer pursuant to clause (iii) above or upon the
request of any Initial Purchaser pursuant to clause (iv)
above, the Company and the Guarantor shall file and use
their reasonable best efforts to have declared effective by
the SEC both an Exchange Offer Registration Statement
pursuant to Section 2(a) with respect to all Registrable
Securities and a Shelf Registration Statement (which may be
a combined Registration Statement with the Exchange Offer
Registration Statement) with respect to offers and sales of
Registrable Securities held by such Holder or such Initial
Purchaser, as applicable, after completion of the Exchange
Offer;
(C) use their reasonable best efforts to keep the Shelf
Registration Statement continuously effective, supplemented
and amended as required, in order to permit the Prospectus
forming part thereof to be usable by Holders, until the
earlier of: (i) a period of two years, plus any extensions
as provided in Section 2(d)(iii) below, from the date the
Shelf Registration Statement is declared effective by the
SEC or (ii) such shorter period which will terminate when
all of the Registrable Securities covered by the Shelf
Registration Statement (a) have been sold pursuant to the
Shelf Registration Statement, (b) cease to be outstanding or
(c) become eligible for resale pursuant to Rule 144 under
the Exchange Act; and
(D) notwithstanding any other provisions hereof, ensure
that (i) any Shelf Registration Statement and any amendment
thereto and any Prospectus forming a part thereof and any
supplement thereto complies in all material respects with
the Securities Act and the rules and regulations thereunder,
(ii) any Shelf Registration Statement and any amendment
thereto does not, when it becomes effective, 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 not misleading and (iii) any
Prospectus forming part of any Shelf Registration Statement,
and any supplement to such Prospectus (as amended or
supplemented from time to time), does not include an untrue
statement of a material fact or omit to state a material
fact necessary in order to make the statements, in light of
the circumstances under which they were made, not
misleading; provided, however, clauses (ii) and (iii) shall
not apply to any information relating to any Initial
Purchaser or any Holder furnished to the Company or the
Guarantor in writing by such Initial Purchaser or Holder
expressly for use in the Shelf Registration Statement.
The Company or the Guarantor shall not permit any securities other
than the Registrable Securities to
9
be included in the Shelf Registration Statement.
The Company and the Guarantor further agree, if necessary, to
supplement or amend the Shelf Registration Statement if reasonably
requested in writing by the Majority Holders with respect to information
relating to the Holders and otherwise as required by Section 3(b) below, to
use their reasonable best efforts to cause any such amendment to become
effective and such Shelf Registration Statement to become usable as soon as
practicable thereafter and to furnish to the Holders of Registrable
Securities copies of any such supplement or amendment promptly after its
being used or filed with the SEC.
(c) Expenses. The Company and the Guarantor shall pay all
Registration Expenses in connection with the registration pursuant to
Sections 2(a) and 2(b). Each Holder shall pay all expenses of its
counsel other than as provided for in this Agreement, and underwriting
discounts and commissions and transfer taxes, if any, relating to the
sale or disposition of such Holder's Registrable Securities pursuant
to a Shelf Registration Statement.
(d) Effective Registration Statement.
(i) The Company and the Guarantor shall be deemed not to
have used their respective reasonable best efforts to cause the
Exchange Offer Registration Statement or the Shelf Registration
Statement, as the case may be, to become, or to remain, effective
during the requisite periods set forth herein if the Company or
the Guarantor voluntarily take any action that could reasonably
be expected to result in any such Registration Statement not
being declared effective or remaining effective or in the Holders
of Registrable Securities covered thereby not being able to
exchange or offer and sell such Registrable Securities during
that period unless (A) such action is required by applicable law
or (B) such action is taken by the Company or such Guarantor in
good faith and for valid business reasons (but not including
avoidance of the Company's or such Guarantor's obligations
hereunder), including the acquisition or divestiture of assets or
a material corporate transaction or event so long as the Company
and the Guarantor promptly comply with the requirements of
Section 3(k) hereof, if applicable.
(ii) An Exchange Offer Registration Statement pursuant to
Section 2(a) hereof or a Shelf Registration Statement pursuant to
Section 2(b) hereof shall not be deemed to have become effective
unless it has been declared effective by the SEC; provided,
however, that if, after it has been declared effective, the
offering of Registrable Securities pursuant to a Registration
Statement is interfered with by any stop order, injunction or
other order or requirement of the SEC or any other governmental
agency or court, such Registration Statement shall be deemed not
to have been effective during the period of such interference,
until the offering of Registrable Securities pursuant to such
Registration Statement may legally resume.
10
(iii) During any 365-day period, the Company and the
Guarantor may suspend the availability of a Shelf Registration
Statement and the use of the related Prospectus, as provided in
Section 3(e)(vi), for up to four periods of up to 45 consecutive
days (except for the consecutive 45-day period immediately prior
to maturity of the Securities), but no more than an aggregate of
90 days during any 365-day period, if any event shall occur (A)
as set forth in Section 2(d)(i) or (B) that, in the reasonable
good faith determination of the board of directors of the Company
or the Guarantor, in accordance with its understanding of the
disclosure requirements of applicable securities law, would
require disclosure of any financing, acquisition, corporate
reorganization or other transaction or development involving the
Company or one of its Affiliates that is or would be material to
the Company and that, in the reasonable judgment of the board of
directors of the Company, such disclosure would not at that time
be in the best interests of the Company (a "Material Event
Election"), provided that any period during which the Company
requires Holders to refrain from disposing of their Registrable
Securities due to a Material Event Election (an "Election
Period") shall be deemed to trigger the obligation of the Company
to pay additional interest in accordance with Section 2(e) to the
extent that such Election Period, together with all other days
that the Shelf Registration Statement has become unusable in any
consecutive twelve-month period, exceeds 90 days in the
aggregate. The two-year period provided for in Section 2(b)(i)(C)
above shall be extended by an amount of time equal to all such
Election Periods.
(e) Increase in Interest Rate. The Indenture provides that in the
event that (i) the Exchange Offer Registration Statement is not filed
with the SEC on or prior to the 150th calendar day after the Closing
Date, (ii) the Exchange Offer Registration Statement is not declared
effective on or prior to the 210th calendar day after the Closing
Date, (iii) the Exchange Offer is not consummated on or prior to the
240th calendar day following the Closing Date, or (iv) if required, a
Shelf Registration Statement with respect to the Registrable
Securities is not filed with the SEC on or prior to the 210th calendar
day after the Closing Date or the 30th calendar day after such filing
obligation arises (whichever is later) or is not declared effective on
or prior to the 240th calendar day after the Closing Date (or within
60 calendar days of a request by any Initial Purchaser), or (v) the
Election Periods exceed, in the aggregate, 90 days during any 365 day
period (each, a "Registration Default"), the per annum interest rate
borne by the Registrable Securities affected thereby shall be
increased by one-quarter of one percent (0.25%) per annum following a
Registration Default; provided that the maximum aggregate additional
interest with respect to a series of Registrable Securities may in no
event exceed one-quarter of one percent (0.25%) per annum. Upon (w)
the filing of the Exchange Offer Registration Statement after the 150
day period described in clause (i) above, (x) the effectiveness of the
Exchange Offer Registration Statement after the 210-day period
described in clause (ii) above, (y) the consummation of the Exchange
Offer after the 240-day period described in clause (iii) above, or (z)
the filing or effectiveness of a Shelf Registration Statement after
the applicable period described in clause (iv) above, the interest
rate borne by such series of Registrable Securities from the date of
such filing, effectiveness or consummation, as the case may be, shall
be reduced to the original interest rate if the
11
Company and the Guarantor are otherwise in compliance with this
paragraph; provided, however, that, if after any such reduction in
interest rate, a different Registration Default occurs, the interest
rate shall again be increased pursuant to the foregoing provisions. No
increase in the rate under clause (i), (ii) or (iii) above shall be
payable for any period during which a Shelf Registration is effective.
(f) Specific Enforcement. Without limiting the remedies available
to the Initial Purchasers and the Holders, the Company and the
Guarantor acknowledge that any failure by the Company and the
Guarantor to comply with their obligations under Sections 2(a) and
2(b) hereof may result in material irreparable injury to the Initial
Purchasers or the Holders for which there is no adequate remedy at
law, that it will not be possible to measure damages for such injuries
precisely and that, in the event of any such failure, the Initial
Purchasers or any Holder may obtain such relief as may be required to
specifically enforce the Company's and the Guarantor's obligations
under Sections 2(a) and 2(b).
3. Registration Procedures. In connection with the obligations of the
Company and the Guarantor with respect to the Registration Statements
pursuant to Sections 2(a) and 2(b) hereof, the Company and the Guarantor
shall:
(a) prepare and file with the SEC a Registration Statement,
within the relevant time periods specified in Section 2, on the
appropriate form under the Securities Act, which form shall (i) be
selected by the Company, (ii) in the case of a Shelf Registration
Statement, be available for the sale of the Registrable Securities by
the selling Holders thereof and (iii) comply as to form in all
material respects with the requirements of the applicable form and
include or incorporate by reference all financial statements required
by the SEC to be filed therewith, and use their reasonable best
efforts to cause such Registration Statement to become effective and
remain effective in accordance with Section 2 hereof;
(b) prepare and file with the SEC such amendments and
post-effective amendments to each Registration Statement as may be
necessary under applicable law to keep such Registration Statement
effective for the applicable period; cause each Prospectus to be
supplemented by any required prospectus supplement, and as so
supplemented to be filed pursuant to Rule 424 under the Securities
Act; and comply with the provisions of the Securities Act with respect
to the disposition of all Securities covered by each Registration
Statement during the applicable period in accordance with the intended
method or methods of distribution by the selling Holders thereof;
(c) in the case of a Shelf Registration, (i) notify each Holder
of Registrable Securities, at least five business days prior to
filing, that a Shelf Registration Statement with respect to the
Registrable Securities is being filed and advising such Holders that
the distribution of Registrable Securities will be made in accordance
with the method elected by the Majority Holders; (ii) furnish to each
Holder of Registrable Securities, to one counsel for the Initial
Purchasers, to one counsel for the Holders and to each underwriter of
an underwritten offering of Registrable Securities, if any, without
charge, as many
12
copies of each Prospectus, including each preliminary Prospectus, and
any amendment or supplement thereto and such other documents as such
Holder or underwriter may reasonably request, including financial
statements and schedules and, if the Holder so reasonably requests,
all exhibits (including those incorporated by reference) in order to
facilitate the public sale or other disposition of the Registrable
Securities; and (iii) subject to the last paragraph of this Section 3,
hereby consent to the use of the Prospectus, including each
preliminary Prospectus, or any amendment or supplement thereto by each
of the selling Holders of Registrable Securities in connection with
the offering and sale of the Registrable Securities covered by the
Prospectus or any amendment or supplement thereto;
(d) use its reasonable best efforts to register or qualify the
Registrable Securities under all applicable state securities or "blue
sky" laws of such jurisdictions as any Holder of Registrable
Securities covered by a Registration Statement and each underwriter of
an underwritten offering of Registrable Securities shall reasonably
request by the time the applicable Registration Statement is declared
effective by the SEC, keep each such registration or qualification
effective during the period such Registration Statement is required to
be effective or until all of such Registrable Securities are solder,
whichever is shortest and do any and all other acts and things which
may be reasonably necessary or advisable to enable such Holder to
consummate the disposition in each such jurisdiction of such
Registrable Securities owned by such Holder; provided, however, that
neither the Company nor the Guarantor shall be required to (i) qualify
as a foreign corporation or as a dealer in securities in any
jurisdiction where it would not otherwise be required to qualify but
for this Section 3(d) or (ii) take any action which would subject it
to general service of process or taxation in any such jurisdiction;
(e) in the case of a Shelf Registration, promptly notify each
Holder of Registrable Securities included in the Shelf Registration
and one counsel for such Holders and, if requested by such Holder or
counsel, confirm such advice in writing promptly (i) when a
Registration Statement has become effective and when any
post-effective amendments and supplements thereto become effective,
(ii) of any request by the SEC or any state securities authority for
post-effective amendments and supplements to a Registration Statement
and Prospectus or for additional information after the Registration
Statement has become effective, (iii) of the issuance by the SEC or
any state securities authority of any stop order suspending the
effectiveness of a Registration Statement or the initiation of any
proceedings for that purpose, (iv) in the case of a Shelf
Registration, between the effective date of a Registration Statement
and the closing of any sale of Registrable Securities covered thereby,
the representations and warranties of the Company and/or the Guarantor
contained in any underwriting agreement, securities sales agreement or
other similar agreement, if any, relating to such offering cease to be
true and correct in all material respects, (v) of the receipt by the
Company or either of the Guarantor of any notification with respect to
the suspension of the qualification of the Registrable Securities for
sale in any jurisdiction or the initiation or threatening of any
proceeding for such purpose, (vi) of the happening of any event or the
discovery of any facts during the period a Shelf Registration
Statement is effective (including as contemplated in Section 2(d)(iii)
hereof) which (A) is contemplated in Section 2(d)(i) or (B) makes any
statement made in such Shelf Registration Statement or the related
Prospectus untrue in any material
13
respect or which requires the making of any changes in such Shelf
Registration Statement or Prospectus in order to make the statements
therein not misleading and (vii) of any determination by the Company
or either of the Guarantor that a post-effective amendment to a
Registration Statement would be appropriate;
(f) (A) in the case of an Exchange Offer Registration
Statement, (i) include in the Exchange Offer Registration
Statement a "Plan of Distribution" section covering the use of
the Prospectus included in the Exchange Offer Registration
Statement by broker-dealers who have exchanged their Registrable
Securities for Exchange Securities for the resale of such
Exchange Securities, (ii) furnish to each broker-dealer who has
delievered to the Company a notice in writing and who desires to
participate in the Exchange Offer, without charge, as many copies
of each Prospectus included in the Exchange Offer Registration
Statement, including any preliminary prospectus, and any
amendment or supplement thereto, as such broker-dealer may
reasonably request, (iii) include in the Exchange Offer
Registration Statement a statement that any broker-dealer who
holds Registrable Securities acquired for its own account as a
result of market-making activities or other trading activities (a
"Participating Broker-Dealer"), and who receives Exchange
Securities for Registrable Securities pursuant to the Exchange
Offer, may be deemed a statutory underwriter and must deliver a
prospectus meeting the requirements of the Securities Act in
connection with any resale of such Exchange Securities, (iv)
subject to the last paragraph of this Section 3, hereby consent
to the use of the Prospectus forming part of the Exchange Offer
Registration Statement or any amendment or supplement thereto, by
any broker-dealer in connection with the sale or transfer of the
Exchange Securities covered by the Prospectus or any amendment or
supplement thereto, provided such Person has provided the Company
in writing with any information required by Item 507 of
Regulation S-K (or any similar provision then in force) for
inclusion in the prospectus contained in the Exchange Offer
Registration Statement, and (v) include in the transmittal letter
or similar documentation to be executed by an exchange offeree in
order to participate in the Exchange Offer the following
provision:
"If the undersigned is not a broker-dealer, the undersigned
represents that it is not engaged in, and does not intend to
engage in, a distribution of Exchange Securities. If the
undersigned is a broker-dealer that will receive Exchange
Securities for its own account in exchange for Registrable
Securities, it represents that the Registrable Securities to
be exchanged for Exchange Securities were acquired by it as
a result of market-making activities or other trading
activities and acknowledges that it will deliver a
prospectus meeting the requirements of the Securities Act in
connection with any resale of such Exchange Securities
pursuant to the Exchange Offer; however, by so acknowledging
and by delivering a prospectus, the undersigned will not be
deemed to admit that it is an "underwriter" within the
meaning of the Securities Act;"
(B) to the extent any Participating Broker-Dealer
participates in the Exchange Offer, the Company and the Guarantor
shall use their reasonable best efforts to cause to be delivered
at
14
the request of an entity representing the Participating
Broker-Dealers (which entity shall be Xxxxxxx Xxxxx Xxxxxx Inc.,
unless it elects not to act as such representative) any "cold
comfort" letters with respect to the Prospectus in the form
existing on the last date for which exchanges are accepted
pursuant to the Exchange Offer and with respect to each
subsequent amendment or supplement, if any, effected during the
period specified in clause (C) below;
(C) to the extent any Participating Broker-Dealer
participates in the Exchange Offer, the Company and the Guarantor
shall use their reasonable best efforts to maintain the
effectiveness of the Exchange Offer Registration Statement for a
period of 180 days following the closing of the Exchange Offer or
such shorter period which will terminate when the Participating
Broker-Dealers have completed all resales subject to applicable
prospectus delivery requirements; and
(D) the Company and the Guarantor shall not be required to
amend or supplement the Prospectus contained in the Exchange
Offer Registration Statement as would otherwise be contemplated
by Section 3(b) hereof, or take any other action as a result of
this Section 3(f), for a period exceeding 180 days after the last
date for which exchanges are accepted pursuant to the Exchange
Offer (as such period may be extended by the Company and the
Guarantor) and Participating Broker-Dealers shall not be
authorized by the Company and the Guarantor to, and shall not,
deliver such Prospectus after such period in connection with
resales contemplated by this Section 3;
(g) (i) in the case of an Exchange Offer, furnish to one counsel
for the Initial Purchasers and (ii) in the case of a Shelf
Registration, furnish to one counsel for the Holders of Registrable
Securities copies of any request by the SEC or any state securities
authority for amendments or supplements to a Registration Statement
and Prospectus or for additional information;
(h) make every reasonable effort to obtain the withdrawal of any
order suspending the effectiveness of a Registration Statement as soon
as practicable and provide notice, as soon as practicable, to each
Holder of the withdrawal of any such order;
(i) in the case of a Shelf Registration, furnish to each Holder
of Registrable Securities, without charge, at least one conformed copy
of each Registration Statement and any post-effective amendment
thereto (without documents incorporated therein by reference or
exhibits thereto, unless requested in writing);
(j) in the case of a Shelf Registration, cooperate with the
selling Holders of Registrable Securities to facilitate the timely
preparation and delivery of certificates representing Registrable
Securities to be sold and not bearing any restrictive legends; and
cause such Registrable Securities to be in such denominations
(consistent with the provisions of the Indenture) in a form eligible
for deposit with the Depositary and registered in such names as the
selling Holders or the underwriters, if any, may
15
reasonably request in writing at least three business days prior to
the closing of any sale of Registrable Securities;
(k) in the case of a Shelf Registration, upon the occurrence of
any event or the discovery of any facts, each as contemplated by
Section 3(e)(vi) hereof, use its reasonable best efforts to prepare a
supplement or post-effective amendment to a Registration Statement or
the related Prospectus or any document incorporated therein by
reference or file any other required document so that, as thereafter
delivered to the purchasers of the Registrable Securities, such
Prospectus will not contain at the time of such delivery any untrue
statement of a material fact or omit to state a material fact
necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. The Company
and the Guarantor agree to notify each Holder to suspend use of the
Prospectus as promptly as practicable after the occurrence of such an
event, and each Holder hereby agrees to suspend use of the Prospectus
until the Company and the Guarantor have amended or supplemented the
Prospectus to correct such misstatement or omission. At such time as
such public disclosure is otherwise made or the Company and the
Guarantor determine that such disclosure is not necessary, in each
case to correct any misstatement of a material fact or to include any
omitted material fact, the Company and the Guarantor agree promptly to
notify each Holder of such determination and to furnish each Holder
such numbers of copies of the Prospectus, as amended or supplemented,
as such Holder may reasonably request;
(l) use its reasonable best efforts to obtain CUSIP numbers for
all Exchange Securities, or Registrable Securities, as the case may
be, not later than the effective date of a Registration Statement, and
provide the Trustee with printed certificates for the Exchange
Securities or Registrable Securities, as the case may be, in a form
eligible for deposit with the Depositary;
(m) in the case of a Shelf Registration, enter into agreements
(including underwriting agreements) and take all other customary and
appropriate actions (including those reasonably requested by the
Majority Holders of the Registrable Securities) in order to expedite
or facilitate the disposition of such Registrable Securities and in
such connection, whether or not an underwriting agreement is entered
into and whether or not the registration is an underwritten
registration, in a manner that is reasonable and customary:
(i) make such representations and warranties to the Holders
of such Registrable Securities and the underwriters, if any, in
form, substance and scope as are customarily made by issuers to
underwriters in similar underwritten offerings as may be
reasonably requested by such Holders and underwriters;
(ii) obtain opinions of counsel to the Company and the
Guarantor and updates thereof (which counsel and opinions (in
form, scope and substance) shall be reasonably satisfactory to
the managing underwriters, if any, and the Holders of a majority
in principal
16
amount of the Registrable Securities being sold) addressed to
each selling Holder and the underwriters, if any, covering the
matters customarily covered in opinions requested in sales of
securities or underwritten offerings and such other matters as
may be reasonably requested by such Holders and underwriters;
(iii) obtain "cold comfort" letters and updates thereof from
the Company's and the Guarantor' independent certified public
accountants addressed to the underwriters, if any, and will use
reasonable best efforts to have such letters addressed to the
selling Holders of Registrable Securities, such letters to be in
customary form and covering matters of the type customarily
covered in "cold comfort" letters to underwriters in connection
with similar underwritten offerings;
(iv) enter into a securities sales agreement with the
Holders and an agent of the Holders providing for, among other
things, the appointment of such agent for the selling Holders for
the purpose of soliciting purchases of Registrable Securities,
which agreement shall be in form, substance and scope customary
for similar offerings; (v) if an underwriting agreement is
entered into in the case of an underwritten offering, cause the
same to set forth indemnification provisions and procedures
substantially equivalent to the indemnification provisions and
procedures set forth in Section 5 hereof with respect to the
underwriters and all other parties to be indemnified pursuant to
Section 5 hereof; and
(vi) deliver such documents and certificates as may be
reasonably requested by the underwriters or the Holders and as
are customarily delivered in similar offerings.
The above shall be done at (i) the effectiveness of such Registration
Statement (and, if requested in writing by the Majority Holders), each
post-effective amendment thereto) and (ii) each closing under any
underwriting or similar agreement as and to the extent required thereunder.
In the case of any underwritten offering, the Company and the Guarantor
shall provide written notice to the Holders of all Registrable Securities
of such underwritten offering at least 10 days prior to the filing of a
prospectus supplement for such underwritten offering. Such notice shall (x)
offer each such Holder the right to participate in such underwritten
offering, (y) specify a date, which shall be no earlier than 10 days
following the date of such notice, by which such Holder must inform the
Company of its intent to participate in such underwritten offering and (z)
include the instructions such Holder must follow in order to participate in
such underwritten offering;
(o) in the case of a Shelf Registration, make available for
inspection by representatives of the Holders of the Registrable
Securities and any underwriters participating in any disposition
pursuant to a Shelf Registration Statement and any U.S. counsel or
accountant retained by such Holders or underwriters, all financial and
other records, pertinent corporate documents and properties of the
Company and the Guarantor reasonably requested by any such Persons,
and cause the respective officers, directors, employees, and any other
agents of the Company and the Guarantor to supply all
17
information reasonably requested by any such representative,
underwriter, special counsel or accountant in connection with a
Registration Statement; provided that any such records, documents,
properties and such information that is designated in writing by the
Company and the Guarantor, in good faith, as confidential at the time
of delivery of such records, documents, properties or information
shall be kept confidential by any such representative, underwriter,
counsel or accountant and shall be used only in connection with such
Shelf Registration Statement, unless such information has become
available (not in violation or breach of this Agreement) to the public
generally or through a third party without an accompanying obligation
of confidentiality, and except that such representative, underwriter,
counsel or accountant shall have no liability, and shall not be in
breach of this provision, if disclosure of such confidential
information is made in connection with a court proceeding or required
by law, and the Company and the Guarantor shall be entitled to request
that such representative, underwriter, counsel or accountant sign a
confidentiality agreement to the foregoing effect. Each such person
will be required to agree that information obtained by it as a result
of such inspections shall be deemed confidential and shall not be used
by it as the basis for any market transactions in the securities of
the Company or the Guarantor unless and until such is made generally
available to the public through no fault or action of such person.
Each selling Holder of such Registrable Securities will be required to
further agree that it will, upon learning that disclosure of
confidential information is necessary, give notice to the Company to
allow the Company at its expense to undertake appropriate action to
prevent disclosure of the confidential information;
(p) (i) in the case of an Exchange Offer, within a reasonable
time prior to the filing of any Exchange Offer Registration Statement,
any Prospectus forming a part thereof, any amendment to an Exchange
Offer Registration Statement or amendment or supplement to a
Prospectus, provide copies of such document to the Initial Purchasers,
and make such changes in any such document prior to the filing thereof
as the Initial Purchasers or their counsel may reasonably request;
(ii) in the case of a Shelf Registration, a reasonable time prior to
filing any Shelf Registration Statement, any Prospectus forming a part
thereof, any amendment to such Shelf Registration Statement or
amendment or supplement to such Prospectus, provide copies of such
document to the Holders of Registrable Securities, to the Initial
Purchasers, to counsel on behalf of the Holders and to the underwriter
or underwriters of an underwritten offering of Registrable Securities,
if any, and make such changes in any such document prior to the filing
thereof as counsel to the Initial Purchasers, the Holders or any
underwriter may reasonably request; and (iii) cause the
representatives of the Company and the Guarantor to be available for
discussion of such document as shall be reasonably requested by the
Holders of Registrable Securities, the Initial Purchasers on behalf of
such Holders or any underwriter, and shall not at any time make any
filing of any such document of which such Holders, the Initial
Purchasers on behalf of such Holders, their counsel or any underwriter
shall not have previously been advised and furnished a copy or to
which such Holders, the Initial Purchasers on behalf of such Holders,
their counsel or any underwriter shall reasonably object within a
reasonable time period;
(q) in the case of a Shelf Registration, use its reasonable best
efforts to cause the
18
Registrable Securities to be rated with at least one "nationally
recognized statistical rating organization" (as defined for purposes
of Rule 436(g)(2) under the Securities Act), if so requested by the
Majority Holders or by the underwriter or underwriters of an
underwritten offering, unless the Registrable Securities are already
so rated;
(r) otherwise use its reasonable best efforts to comply with all
applicable rules and regulations of the SEC and make available to its
security holders, as soon as reasonably practicable, an earnings
statement covering at least twelve (12) months which shall satisfy the
provisions of Section 11(a) of the Securities Act and Rule 158
thereunder; and
(s) cooperate and assist in any filings required to be made with
the NASD and in the performance of any due diligence investigation by
any underwriter and its counsel.
In the case of a Shelf Registration Statement, the Company and the
Guarantor may (as a condition to such Holder's participation in the Shelf
Registration) require each Holder of Registrable Securities to furnish to
the Company and the Guarantor or their counsel such information regarding
such Holder and the proposed distribution by such Holder of such
Registrable Securities, as the Company or the Guarantor may from time to
time reasonably request, and agree in writing to be bound by the Agreement,
including the indemnification provisions.
In the case of a Shelf Registration Statement, each Holder agrees
that, upon receipt of any notice from the Company or either of the
Guarantor of the happening of any event or the discovery of any facts, each
of the kind described in Sections 2(d)(i) and 3(e)(ii)-(vii) hereof, such
Holder will forthwith discontinue disposition of Registrable Securities
pursuant to a Registration Statement until such Holder's receipt of (i) the
copies of the supplemented or amended Prospectus contemplated by Section
3(k) hereof or (ii) written notice from the Company or the either of the
Guarantor that the Shelf Registration Statement is once again effective and
that no supplement or amendment is required. If so directed by the Company
or either of the Guarantor, such Holder will deliver to the Company (at the
Company's expense) all copies in the Holder's possession, other than
permanent file copies then in such Holder's possession, of the Prospectus
covering such Registrable Securities current at the time of receipt of such
notice.
If the Company or either of the Guarantor shall give any such notice
to suspend the disposition of Registrable Securities pursuant to a Shelf
Registration Statement as a result of the happening of any event or the
discovery of any facts, each of the kind described in Sections 2(d)(i) and
3(e)(vi) hereof, the Company and the Guarantor shall be deemed to have used
their reasonable best efforts to keep the Shelf Registration Statement
effective during such period of suspension; provided that (i) such period
of suspension shall not exceed the time periods provided in Section
2(d)(iii) hereof and (ii) the Company and the Guarantor shall, if
necessary, use their reasonable best efforts to file and have declared
effective (if an amendment) as soon as practicable an amendment or
supplement to the Shelf Registration Statement and shall extend the period
during which the Registration Statement shall be maintained effective
pursuant to this Agreement by the number of days during
19
the period from and including the date of the giving of such notice to and
including the date when the Holders shall have received copies of the
supplemented or amended Prospectus necessary to resume such dispositions.
4. Underwritten Registrations. If any of the Registrable Securities
covered by any Shelf Registration are to be sold in an underwritten
offering, the investment banker or investment bankers and manager or
managers that will manage the offering will be selected by the Majority
Holders of such Registrable Securities included in such offering and shall
be reasonably acceptable to the Company.
No Holder of Registrable Securities may participate in any
underwritten registration hereunder unless such Holder (a) agrees to sell
such Holder's Registrable Securities on the basis provided in any
underwriting arrangements approved by the Persons entitled hereunder to
approve such arrangements and (b) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements
and other documents required under the terms of such underwriting
arrangements.
5. Indemnification and Contribution.
(a) The Company and the Guarantor, jointly and severally, agree
to indemnify and hold harmless each Initial Purchaser, each Holder,
including Participating Broker-Dealers, each underwriter who
participates in an offering of Registrable Securities, their
respective Affiliates, and their respective directors, officers,
employees, agents, and each Person, if any, who controls any Initial
Purchaser or any Holder within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act, from and against any
and all losses, claims, damages and liabilities (including, without
limitation, any legal or other expenses reasonably incurred by the
Initial Purchaser, any Holder or any such controlling or affiliated
Person in connection with defending or investigating any such action
or claim) caused by any untrue statement or alleged untrue statement
of a material fact contained in any Registration Statement or any
amendment thereof, pursuant to which Exchange Securities or
Registrable Securities were registered under the Securities Act,
including all documents incorporated therein by reference, or caused
by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements
therein not misleading, or caused by any untrue statement or alleged
untrue statement of a material fact contained in any Prospectus (as
amended or supplemented if the Company and the Guarantor shall have
furnished any amendments or supplements thereto), or caused by any
omission or alleged omission to state therein a material fact
necessary to make the statements therein in light of the circumstances
under which they were made not misleading, except insofar as such
losses, claims, damages or liabilities are caused by any such untrue
statement or omission or alleged untrue statement or omission based
upon information relating to any Initial Purchaser any Holder or
underwriter furnished to the Company and the Guarantor in writing by
such Initial Purchaser or by or relating to any Holder or underwriter
who participates in an offering of Registrable Securities, in each
case expressly for use therein.
(b) Each Holder agrees, severally and not jointly, to indemnify
and hold harmless the
20
Company, each Guarantor, each Initial Purchaser, each underwriter who
participates in an offering of Registrable Securities, and the other
selling Holders, and each of their respective Affiliates and
directors, officers (including each director and officer of the
Company and the Guarantor who signed the Registration Statement)
employees and agents and each Person, if any, who controls the Company
or either Guarantor, any Initial Purchaser, any underwriter or any
other selling Holder within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act from and against any
and all losses, claims, damages and liabilities (including, without
limitation, any legal or other expenses described in the indemnity
contained in Section 5(a), as incurred), but only with reference to
information relating to such Holder furnished to the Company or the
Guarantor in writing by such Holder expressly for use in any
Registration Statement or any amendment thereof or any Prospectus or
any amendments or supplements thereto.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any Person in respect of
which indemnity may be sought pursuant to either paragraph (a) or
paragraph (b) above, such Person (the "indemnified party") shall
promptly notify the person against whom such indemnity may be sought
(the "indemnifying party") in writing (but the failure to so notify
the indemnifying party will not relieve it from any liability which it
may have to any indemnified party except to the extent it is
materially prejudiced or harmed) and the indemnifying party, upon
request of the indemnified party, shall retain counsel reasonably
satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such
proceeding and shall pay the fees and disbursements of such counsel
related to such proceeding. In any such proceeding, any indemnified
party shall have the right to retain its own counsel, but the fees and
expenses of such counsel shall be at the expense of such indemnified
party unless (i) the indemnifying party and the indemnified party
shall have mutually agreed to the retention of such counsel or (ii)
the named parties to any such proceeding (including any impleaded
parties) include both the indemnifying party and the indemnified party
and representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between
them. It is understood that the indemnifying party shall not, in
respect of the legal expenses of any indemnified party in connection
with any proceeding or related proceedings in the same jurisdiction,
be liable for (a) (if the indemnifying party is the Company or the
Guarantor) the fees and expenses of more than one separate firm (in
addition to any local counsel) for the Initial Purchasers and all
Persons, if any, who control any Initial Purchaser within the meaning
of either Section 15 of the Securities Act or Section 20 of the
Exchange Act, (b) (if the indemnifying party is a Holder) the fees and
expenses of more than one separate firm (in addition to any local
counsel) for the Company and the Guarantor, their respective
directors, their respective officers who sign the Registration
Statement and all Persons, if any, who control the Company or the
Guarantor within the meaning of either such Section and (c) (if the
indemnifying party is the Company or the Guarantor) the fees and
expenses of more than one separate firm (in addition to any local
counsel) for all Holders and all Persons, if any, who control any
Holders within the meaning of either such Section, and that all such
fees and expenses shall be reimbursed as they are incurred. In the
case of any such separate firm for the Initial Purchasers and such
control Persons of the Initial Purchasers, such firm shall be
designated in writing by Xxxxxxx Xxxxx Xxxxxx Inc. In the case of any
such separate firm for the Holders and such Persons who control
Holders, such firm shall be designated in writing by the Majority
Holders. In all other cases, such firm shall be designated in
21
writing by the Company. The indemnifying party shall not be liable for
any settlement of any proceeding affected without its written consent,
but if settled with such consent or if there is a final judgment for
the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by reason of
such settlement or judgment. Notwithstanding the foregoing sentence,
if at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and
expenses of counsel as contemplated by the second and third sentences
of this paragraph, the indemnifying party agrees that it shall be
liable for any settlement of any proceeding effected without its
written consent if (i) such settlement is entered into more than 60
days after receipt by such indemnifying party of the aforesaid request
and (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date of
such settlement. No indemnifying party shall, without the prior
written consent of the indemnified party, which consent shall not be
unreasonably withheld, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder
by such indemnified party, unless such settlement (i) includes an
unconditional release of such indemnified party from all liability on
claims that are the subject matter of such proceeding and (ii) does
not include a statement as to an admission of fault, culpability or
failure to act by or on behalf of any indemnified party.
(d) If the indemnification provided for in paragraph (a) or
paragraph (b) of this Section 5 is unavailable to an indemnified party
or insufficient in respect of any losses, claims, damages or
liabilities referred to therein, then each indemnifying party under
such paragraph, in lieu of indemnifying such indemnified party
thereunder, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or
liabilities in such proportion as is appropriate to reflect the
relative fault of the indemnifying party or parties on the one hand
and of the indemnified party or parties on the other hand in
connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities, as well as any other relevant
equitable considerations. The relative fault of such indemnifying
party or parties on the one hand and the indemnified party or parties
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 such indemnifying party or parties
or such indemnified party or parties, and the parties' relative
intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The obligations of the Initial
Purchasers and the Holders of Registrable Securities to contribute
pursuant to this Section 5 are several in proportion to the respective
number of Securities have purchased hereunder, and not joint.
(e) The Company, each Guarantor, the Initial Purchasers, and each
Holder of Registrable Securities agree that it would not be just or
equitable if contribution pursuant to this Section 5 were determined
by pro rata allocation (even if the Initial Purchasers were treated as
one entity for such
22
purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in paragraph (d)
above. The amount paid or payable by an indemnified party as a result
of the losses, claims, damages and liabilities referred to in
paragraph (d) above shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating or
defending any such action or claim. Notwithstanding the provisions of
this Section 5, no Holder shall be required to indemnify or contribute
any amount in excess of the amount by which the total price at which
Registrable Securities were sold by such Holder exceeds the amount of
any damages that such Holder has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or
alleged omission. No Person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be
entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 5, each
Person, if any, who controls an Initial Purchaser or Holder or
underwriter 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 or underwriter, and
each director of the Company or the Guarantor, each officer of the
Company or the Guarantor who signed the Registration Statement, and
each Person, if any, who controls the Company or the Guarantor 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
and the Guarantor. The remedies provided for in this Section 5 are not
exclusive and shall not limit any rights or remedies which may
otherwise be available to any indemnified party at law or in equity.
The indemnity and contribution provisions contained in this Section 5
shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by or on behalf
of any Initial Purchaser or any Holder or underwriter, or any Person
controlling any Initial Purchaser or any Holder or underwriter, or by or on
behalf of the Company or the Guarantor, their officers or directors or any
Person controlling the Company or the Guarantor, (iii) acceptance of any of
the Exchange Securities and (iv) any sale of Registrable Securities
pursuant to a Shelf Registration Statement.
6. Miscellaneous.
(a) Rule 144 and Rule 144A. For so long as the Company is subject
to the reporting requirements of Section 13 or 15 of the Exchange Act,
the Company covenants that it will file the reports required to be
filed by it under Section 13(a) or 15(d) of the Exchange Act and the
rules and regulations adopted by the SEC thereunder, that if it ceases
to be so required to file such reports, it will upon the request of
any Holder of Registrable Securities (i) make publicly available or
cause to be made publicly available such information as is necessary
to permit sales pursuant to Rule 144 under the Securities Act, (ii)
deliver or cause to be delivered such information to a prospective
purchaser as is necessary to permit sales pursuant to Rule 144A under
the Securities Act and it will take such further action as any Holder
of Registrable Securities may reasonably request, and (iii) take such
further action that is reasonable in the circumstances, in each case,
to the extent required from time to time to enable
23
such Holder to sell its Registrable Securities without registration
under the Securities Act within the limitation of the exemptions
provided by (x) Rule 144 under the Securities Act, as such Rule may be
amended from time to time, (y) Rule 144A under the Securities Act, as
such Rule may be amended from time to time, or (z) any similar rules
or regulations hereafter adopted by the SEC. Upon the written request
of any Holder of Registrable Securities, the Company will deliver to
such Holder a written statement as to whether it has complied with
such requirements.
(b) No Inconsistent Agreements. Neither the Company nor the
Guarantor have entered into nor will the Company or the Guarantor on
or after the date of this Agreement enter into any agreement which is
inconsistent with the rights granted to the Holders of Registrable
Securities in this Agreement or otherwise conflicts with the
provisions hereof. The rights granted to the Holders hereunder do not
in any way conflict with and are not inconsistent with the rights
granted to the holders of the Company's or the Guarantor' other issued
and outstanding securities under any such agreements.
(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 material provisions hereof may not be given unless the Company has
obtained the written consent of the Majority Holders of the
outstanding Registrable Securities affected by such amendment,
modification, supplement, waiver or departure.
(d) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery,
registered first-class mail, telecopier, or any courier guaranteeing
overnight delivery (i) if to a Holder (other than an Initial
Purchaser), at the most current address set forth on the records of
the Registrar under the Indenture, (ii) if to an Initial Purchaser, at
the most current address given by such Initial Purchaser to the
Company by means of a notice given in accordance with the provisions
of this Section 6(d), which address initially is the address set forth
in the Purchase Agreement; and (iii) if to the Company or the
Guarantor, initially at their respective addresses set forth in the
Purchase Agreement and thereafter at such other addresses, notice of
which are given in accordance with the provisions of this Section
6(d).
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five
business days after being deposited in the mail, postage prepaid, if
mailed; when receipt is acknowledged, if telecopied; and on the next
business day if timely delivered to an air courier guaranteeing overnight
delivery.
Copies of all such notices, demands, or other communications shall be
concurrently delivered by the Person giving the same to the Trustee, at the
address specified in the Indenture.
(e) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors, assigns and transferees
of each of the parties, including, without limitation and
24
without the
need for an express assignment, subsequent Holders; provided that
nothing herein shall be deemed to permit any assignment, transfer or
other disposition of Registrable Securities in violation of the terms
hereof or of the Purchase Agreement or the Indenture. If any
transferee of any Holder shall acquire Registrable Securities, in any
manner, whether by operation of law or otherwise, such Registrable
Securities shall be held subject to all of the terms of this
Agreement, and by taking and holding such 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,
including the restrictions on resale set forth in this Agreement and,
if applicable, the Purchase Agreement, and such Person shall be
entitled to receive the benefits hereof.
(f) Third Party Beneficiary. The Holders shall be third party
beneficiaries to the agreements made hereunder between the Company and
the Guarantor on the one hand, and the Initial Purchasers, on the
other hand, and shall have the right to enforce such agreements
directly to the extent it deems such enforcement necessary or
advisable to protect its rights or the rights of Holders hereunder.
(g) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement.
(h) Headings. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the meaning
hereof.
(i) Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York,
without regard to its conflict of laws provisions.
(j) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any
circumstance, is held invalid, illegal or unenforceable, the validity,
legality and enforceability of any such provision in every other
respect and of the remaining provisions contained herein shall not be
affected or impaired thereby.
[Signatures on next page]
25
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first written above.
DELHAIZE AMERICA, INC.
By: /s/ XXXXXXX X. XXXXXX
---------------------
Name: Xxxxxxx X. Xxxxxx
Title: Executive Vice President and
General Counsel
FOOD LION LLC
By: /s/ G. XXXX XXXXX
-----------------
Name: G. Xxxx Xxxxx
Title: Assistant Secretary
The foregoing Agreement is hereby confirmed and accepted as of the date
first above written:
XXXXXXX XXXXX XXXXXX INC.
XXXXX SECURITIES INC.
DEUTSCHE BANC ALEX. XXXXX, INC.
By: XXXXXXX XXXXX BARNEY INC.
By: /s/ XXXXXXX XXXXXX
-------------------------
Name: Xxxxxxx Xxxxxx
Title: Vice President
For themselves and the other Initial Purchasers
