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EXHIBIT 10.8
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REGISTRATION RIGHTS AGREEMENT
DATED AS OF JANUARY 27, 1998
BY AND AMONG
LIBERTY GROUP OPERATING, INC.,
THE SUBSIDIARY GUARANTORS NAMED HEREIN
AS ISSUERS
AND
XXXXXXXXX, XXXXXX & XXXXXXXX SECURITIES CORPORATION
CITICORP SECURITIES, INC.
BT ALEX. XXXXX
XXXXX SECURITIES INC.,
AS INITIAL PURCHASERS
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REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made
and entered into as of January 27, 1998, among LIBERTY GROUP OPERATING, INC., a
Delaware corporation (the "Company"), THE SUBSIDIARY GUARANTORS SET FORTH ON
THE SIGNATURE PAGE HEREOF (the "Subsidiary Guarantors") and XXXXXXXXX, LUFKIN &
XXXXXXXX SECURITIES CORPORATION, CITICORP SECURITIES, INC., BT ALEX. XXXXX and
XXXXX SECURITIES INC. (collectively, the "Initial Purchasers").
This Agreement is made pursuant to the Purchase Agreement,
dated January 15, 1998, among the Company, the Subsidiary Guarantors and the
Initial Purchasers (the "Purchase Agreement"), which provides for the sale by
the Company to the Initial Purchasers of $180,000,000 aggregate principal
amount of 9 3/8% Series A Senior Subordinated Notes due 2008 (the "Series A
Notes"). In order to induce the Initial Purchasers to enter into the Purchase
Agreement, the Company and the Subsidiary Guarantors have agreed to provide to
the Initial Purchasers and their respective direct and indirect transferees,
among other things, the registration rights for the Series A Notes set forth in
this Agreement. The execution of this Agreement is a condition to the closing
of the transactions contemplated by the Purchase Agreement.
The parties hereby agree as follows:
1. Definitions
As used in this Agreement, the following terms shall have the
following meanings (and, unless otherwise indicated, capitalized terms used
herein without definition shall have the respective meanings ascribed to them
by the Purchase Agreement):
Applicable Period: See Section 2(b) hereof.
Company: See the introductory paragraphs to this Agreement.
controlling person: See Section 7 hereof.
DTC: See Section 5(i) hereof.
Effectiveness Period: See Section 3(a) hereof.
Effectiveness Target Date: See Section 4(a)(ii) hereof.
Exchange Act: The Securities Exchange Act of 1934, as
amended, and the rules and regulations of the SEC promulgated thereunder.
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Exchange Offer: See Section 2(a) hereof.
Exchange Offer Registration Statement: See Section 2(a)
hereof.
Holder: Any holder of Transfer Restricted Securities.
indemnified party: See Section 7 hereof.
Indemnified Person: See Section 7 hereof.
indemnifying person: See Section 7 hereof.
Indenture: The Indenture, dated as of the date hereof, by and
among the Company, the Subsidiary Guarantors and State Street Bank and Trust
Company, as trustee (the "Trustee"), pursuant to which the Series A Notes and
Series B Notes are being issued, as amended or supplemented from time to time
in accordance with the terms thereof.
Initial Purchasers: See the introductory paragraphs to this
Agreement.
Inspectors: See Section 5(m) hereof.
Issue Date: As defined in the Offering Memorandum.
Liquidated Damages: See Section 4(a) hereof.
NASD: See Section 5(q) hereof.
Offering Memorandum: The final Offering Memorandum dated
January 15, 1998 related to the sale of the Series A Notes.
Participating Broker-Dealer: See Section 2(b) hereof.
Person or person: An individual, trustee, corporation,
partnership, joint stock company, trust, unincorporated association, union,
business association, limited liability company, limited liability partnership,
firm or other legal entity.
Prospectus: The prospectus included in any Registration
Statement (including, without limitation, any prospectus subject to completion
and a prospectus that includes any information previously omitted from a
prospectus filed as part of an effective registration statement in reliance
upon Rule 430A promulgated under the Securities Act), as amended or
supplemented by any prospectus supplement, with respect to the offering of any
portion of the Series B Notes and/or the Transfer Restricted Securities (as
applicable), covered by such Registration Statement, and all other amendments
and supplements to the
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Prospectus, including post-effective amendments, and all material incorporated
by reference or deemed to be incorporated by reference in such Prospectus.
Purchase Agreement: See the introductory paragraphs to
this Agreement.
Records: See Section 5(m) hereof.
Registration Default: See Section 4(a) hereof.
Registration Statement: The Exchange Offer Registration
Statement or a registration statement of the Company and the Subsidiary
Guarantors that otherwise covers any of the Transfer Restricted Securities
pursuant to the provisions of this Agreement, including the Prospectus,
amendments and supplements to such registration statement, including
post-effective amendments, all exhibits, and all material incorporated by
reference or deemed to be incorporated by reference in such registration
statement.
Rule 144: Rule 144 promulgated pursuant to the Securities
Act, as currently in effect, as such rule may be amended from time to time, or
any similar rule or regulation hereafter adopted by the SEC.
Rule 144A: Rule 144A promulgated pursuant to the Securities
Act, as currently in effect, as such rule may be amended from time to time, or
any similar rule or regulation hereafter adopted by the SEC.
Rule 415: Rule 415 promulgated pursuant to the Securities
Act, as such rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the SEC.
SEC: The Securities and Exchange Commission.
Securities Act: The Securities Act of 1933, as amended, and
the rules and regulations of the SEC promulgated thereunder.
Series A Notes: See the introductory paragraphs to this
Agreement.
Series B Notes: See Section 2(a) hereof.
Shelf Notice: See Section 2(c) hereof.
Shelf Registration Statement: See Section 3(a) hereof.
Subsidiary Guarantors: See the introductory paragraphs to
this Agreement.
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TIA: The Trust Indenture Act of 1939, as amended, and the
rules and regulations of the SEC promulgated thereunder.
Transfer Restricted Securities: The Series A Notes upon
original issuance thereof and at all times subsequent thereto, until in the
case of any such Series A Notes, the earliest to occur of, the date on which
(i) a Registration Statement covering such has been declared effective by the
SEC and such Series A Notes have been disposed of in accordance with such
effective Registration Statement, (ii) such Series A Notes are sold in
compliance with Rule 144 or are eligible for sale under Rule 144(k) or (iii)
such Series A Notes cease to be outstanding (including, without limitation,
upon an exchange of such Series A Notes for Series B Notes in the Exchange
Offer).
Trustee: See the definition of Indenture.
Underwritten registration or underwritten offering: A
registration in which securities of the Company are sold to an underwriter for
reoffering to the public.
2. Exchange Offer
(a) The Company and the Subsidiary Guarantors agree to file
with the SEC within 60 days after the Issue Date a registration statement under
the Securities Act with respect to an offer to exchange (the "Exchange Offer")
any and all of the Transfer Restricted Securities for a like aggregate
principal amount of debt securities of the Company (the "Series B Notes"),
including the subsidiary guarantees of the Subsidiary Guarantors, which Series
B Notes will be (i) substantially identical in all material respects to the
Series A Notes, except that such Series B Notes will not contain terms with
respect to transfer restrictions, and (ii) entitled to the benefits of the
Indenture or a trust indenture which is identical to the Indenture (other than
such changes to the Indenture or any such identical trust indenture as are
necessary to comply with any requirements of the SEC to effect or maintain the
qualification thereof under the TIA), and which, in either case, has been
qualified under the TIA, and (iii) registered pursuant to an effective
Registration Statement in compliance with the Securities Act. The Exchange
Offer will be registered pursuant to the Securities Act on an appropriate form
of Registration Statement (the "Exchange Offer Registration Statement"), and
will comply with all applicable tender offer rules and regulations promulgated
pursuant to the Exchange Act and shall be duly registered or qualified pursuant
to all applicable state securities or Blue Sky laws, except as would subject
the Company to general taxation or service of process where it is not currently
subject. The Exchange Offer shall not be subject to any condition, other than
that the Exchange Offer does not violate any applicable law, policy or
interpretation of the staff of the SEC. No securities shall be included in the
Exchange Offer Registration Statement other than the Series B Notes. Each of
the Company and the Subsidiary Guarantors agrees (x) to use its reasonable best
efforts to cause such Exchange Offer Registration Statement to be declared
effective under the Securities Act within 135 days after the Issue Date; (y) to
keep the
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Exchange Offer open for not less than 30 days (or such longer period required
by applicable law) after the date that the notice of the Exchange Offer
referred to below is mailed to Holders; and (z) to use its reasonable best
efforts to consummate the Exchange Offer within 45 days after the Effectiveness
Target Date. As promptly as practicable after the Exchange Offer Registration
Statement is declared effective, the Company and the Subsidiary Guarantors will
commence the offer of Series B Notes in exchange for properly tendered Series A
Notes. For each Series A Note validly tendered pursuant to the Exchange Offer,
the holder of such Series A Note will receive a Series B Note having a
principal amount at maturity equal to that of the tendered Series A Note.
Each Holder who participates in the Exchange Offer will be
required to represent that any Series B Notes received by it will be acquired
in the ordinary course of its business, that at the time of the consummation of
the Exchange Offer such Holder will have no arrangement or understanding with
any person to participate in the distribution (within the meaning of the
Securities Act) of the Series B Notes, and that such Holder is not an
"affiliate" of the Company within the meaning of Rule 405 of the Securities Act
(or that if it is such an affiliate, it will comply with the registration and
prospectus delivery requirements of the Securities Act to the extent
applicable). Each Holder that is not a Participating Broker-Dealer will be
required to represent that it is not engaged in, and does not intend to engage
in, the distribution of the Series B Notes. Each Holder that (i) is a
Participating Broker-Dealer and (ii) will receive Series B Notes for its own
account in exchange for the Transfer Restricted Securities that it acquired as
the result of market-making or other trading activities will be required to
acknowledge that it will deliver a Prospectus as required by law in connection
with any resale of such Series B Notes. The Company and the Subsidiary
Guarantor shall allow Participating Broker-Dealers and other persons, if any,
subject to prospectus delivery requirements to use the Prospectus included in
the Exchange Offer Registration Statement in connection with the resale of the
Series B Notes. Upon consummation of the Exchange Offer in accordance with
this Agreement, the Company and the Subsidiary Guarantors shall have no further
obligation to register Transfer Restricted Securities pursuant to Section 3 of
this Agreement.
(b) The Company and the Subsidiary Guarantors shall
include within the Exchange Offer Registration Statement a section entitled
"Plan of Distribution," reasonably acceptable to the Initial Purchasers, which
shall contain a summary statement of the positions taken or policies made by
the staff of the SEC with respect to the potential "underwriter" status of any
broker-dealer that acquired Series A Notes as the result of market-making
activities or other trading activities (and not directly from the Company) and
is the beneficial owner (as defined in Rule 13d-3 under the Exchange Act) of
Series B Notes received by such broker-dealer in the Exchange Offer (a
"Participating Broker-Dealer"). Such "Plan of Distribution" section shall also
allow the use of the Prospectus by all persons subject to the prospectus
delivery requirements of the Securities Act, including all Participating
Broker-Dealers, and include a statement describing the means by which
Participating Broker-Dealers may resell the Series B Notes.
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Each of the Company and the Subsidiary Guarantors shall use
its reasonable best efforts to keep the Exchange Offer Registration Statement
effective under the Securities Act and to amend and supplement the Prospectus
contained therein, in order to permit such Prospectus to be lawfully delivered
by all persons subject to the prospectus delivery requirements of the
Securities Act for such period of time as is necessary to comply with
applicable law and the policies, rules and regulations of the SEC as announced
from time to time in connection with any resale of the Series B Notes provided
that such period shall not exceed 180 days from the consummation of the
Exchange Offer (or such longer period if extended pursuant to the last
paragraph of Section 5 hereof) (the "Applicable Period").
In connection with the Exchange Offer, the Company and the
Subsidiary Guarantors shall:
(a) mail as promptly as practicable 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;
(b) utilize the services of a depositary for the Exchange
Offer with an address in the Borough of Manhattan, The City of New
York; and
(c) permit Holders to withdraw tendered Series A Notes at
any time prior to the close of business, New York time, on the last
business day on which the Exchange Offer shall remain open.
As soon as practicable after the close of the Exchange Offer,
the Company and the Subsidiary Guarantors shall:
(i) accept for exchange all Series A Notes tendered and not
validly withdrawn pursuant to the Exchange Offer;
(ii) deliver, or cause to be delivered, to the Trustee for
cancellation all Series A Notes so accepted for exchange; and
(iii) cause the Trustee to authenticate and deliver
promptly to each Holder of Series A Notes, Series B Notes equal in
principal amount to the Series A Notes of such Holder so accepted for
exchange.
(c) If (1) prior to the consummation of the Exchange Offer,
any change in law or in the applicable interpretations of the staff of the SEC
do not permit the Company and the Subsidiary Guarantors to effect the Exchange
Offer, or (2) for any other reason the Exchange Offer is not consummated within
180 days of the Issue Date, then the Company and the Subsidiary Guarantors
shall as promptly as practicable deliver to the Holders and the
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Trustee written notice thereof (the "Shelf Notice"), and the Company and the
Subsidiary Guarantors shall file a Registration Statement pursuant to Section 3
hereof. Following the delivery of a Shelf Notice to the Holders of Transfer
Restricted Securities, the Company and the Subsidiary Guarantors shall not have
any further obligation to conduct the Exchange Offer pursuant to this Section
2.
3. Shelf Registration
If the Company and the Subsidiary Guarantors are required to
deliver a Shelf Notice as contemplated by Section 2(c) hereof, then:
(a) Shelf Registration. The Company and the Subsidiary
Guarantors shall prepare and file with the SEC, within 45 days after such
filing obligation arises, a Registration Statement for an offering to be made
on a continuous basis pursuant to Rule 415 covering all of the Transfer
Restricted Securities (the "Shelf Registration Statement"). The Shelf
Registration Statement shall be on Form S-1 or another appropriate form
permitting registration of the Transfer Restricted Securities for resale by the
Holders in the manner or manners designated by the Holders of a majority in
aggregate principal amount of the outstanding Transfer Restricted Securities
(including, without limitation, an underwritten offering). The Company and the
Subsidiary Guarantors shall not permit any securities other than the Transfer
Restricted Securities to be included in the Shelf Registration Statement. Each
of the Company and the Subsidiary Guarantors shall use its reasonable best
efforts to cause the Shelf Registration Statement to be declared effective
pursuant to the Securities Act on or prior to 135 days after such obligation
arises and to keep the Shelf Registration Statement continuously effective
under the Securities Act until the earlier of (i) the date which is 24 months
following the Issue Date (or such longer period if extended pursuant to the
last paragraph of Section 5 hereof), (ii) the date that all Transfer Restricted
Securities covered by the Shelf Registration Statement have been sold in the
manner set forth and as contemplated in the Shelf Registration Statement or
(iii) the date that there ceases to be outstanding any Transfer Restricted
Securities (the "Effectiveness Period").
(b) Supplements and Amendments. Each of the Company and
the Subsidiary Guarantors shall use its reasonable best efforts to keep the
Shelf Registration Statements continuously effective during the Effectiveness
Period by supplementing and amending the Shelf Registration Statement if
required by the rules, regulations or instructions applicable to the
registration form used for such Shelf Registration Statement, or if reasonably
requested in writing timely received setting forth the reasons for such request
by the Holders of a majority in aggregate principal amount of the Transfer
Restricted Securities covered by such Registration Statement or by any
underwriter of such Transfer Restricted Securities.
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4. Liquidated Damages
(a) The Company, the Subsidiary Guarantors and the Initial
Purchasers agree that the Holders of Transfer Restricted Securities will suffer
damages if the Company and the Subsidiary Guarantors fail to fulfill their
obligations pursuant to Section 2 or Section 3 hereof and that it would not be
possible to ascertain the extent of such damages. Accordingly, in the event of
such failure by the Company and the Subsidiary Guarantors to fulfill such
obligations, each of the Company and the Subsidiary Guarantors hereby agrees to
pay liquidated damages ("Liquidated Damages") to each Holder of Transfer
Restricted Securities under the circumstances and to the extent set forth
below:
(i) if either the Exchange Offer Registration Statement or,
if applicable, the Shelf Registration Statement has not been filed
with the SEC on or prior to the applicable date specified for such
filing; or
(ii) if either the Exchange Offer Registration Statement
or, if applicable, the Shelf Registration Statement is not declared
effective by the SEC on or prior to the applicable date specified for
such effectiveness (the "Effectiveness Target Date"); or
(iii) if an Exchange Offer Registration Statement becomes
effective, but the Company fails to consummate the Exchange Offer
within 45 days of the earlier of the effectiveness of such
registration statement or 135 days after the Issue Date; or
(iv) if the Shelf Registration Statement is declared
effective by the SEC but thereafter such Shelf Registration Statement
ceases to be effective or usable in connection with resales of Series
A Notes during the Effectiveness Period;
(any of the foregoing, a "Registration Default"), then the Company (which
obligation is guaranteed by the Subsidiary Guarantors pursuant to the
Indenture) shall pay Liquidated Damages to each Holder, with respect to the
first 90-day period or portion thereof immediately following the occurrence of
such Registration Default, in an amount equal to $0.05 per week per $1,000
principal amount of Transfer Restricted Securities held by such Holder. Upon a
Registration Default, Liquidated Damages will accrue at the rate specified
above until such Registration Default is cured and the amount of Liquidated
Damages will increase by an additional $0.05 per week per $1,000 principal
amount of Transfer Restricted Securities with respect to each subsequent 90-day
period or portion thereof, up to a maximum amount of Liquidated Damages of
$0.30 per week per $1,000 principal amount of Transfer Restricted Securities
(regardless of whether one or more than one Registration Default is
outstanding). Following the cure of any Registration Default relating to any
Transfer Restricted Securities, the accrual of Liquidated Damages with respect
to such Registration Default will cease. A Registration Default under clause
(i) above shall be cured on the date that the Exchange Offer Registration
Statement or the Shelf Registration Statement, as applicable, is filed with the
SEC; a Registration Default under clause (ii) above shall be cured on the date
that the Exchange Offer Registration Statement or the Shelf
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Registration Statement, as applicable, is declared effective by the SEC; a
Registration Default under clause (iii) above shall be cured on the earlier of
the date (A) the Exchange Offer is consummated or (B) the Company delivers a
Shelf Notice to the Holders of Transfer Restricted Securities; and a
Registration Default under clause (iv) above shall be cured on the earlier of
(A) the date the Shelf Registration Statement is declared effective and is
usable or (B) the Effectiveness Period expires.
(b) The Company shall notify the Trustee within one
business day after each and every date on which a Registration Default first
occurs. Accrued and unpaid Liquidated Damages shall be paid by the Company to
the Holders by wire transfer of immediately available funds to the accounts
specified by them or by mailing checks to their registered addresses if no such
accounts have been specified on each interest payment date provided in the
Indenture (whether or not any interest is then payable on the Series A Notes)
and on each payment date provided in the Indenture, including, without
limitation, whether upon redemption, maturity (by acceleration or otherwise),
purchase upon a change of control or purchase upon a sale of assets. Each
obligation to pay Liquidated Damages with respect to any Registration Default
shall be deemed to commence accruing on the date of such Registration Default
and to cease accruing when such Registration Default has been cured. In no
event shall the Company pay Liquidated Damages in excess of the applicable
maximum weekly amount set forth above, regardless of whether one or multiple
Registration Defaults exist.
(c) The parties hereto agree that the Liquidated Damages
provided for in this Section 4 constitute a reasonable estimate of the damages
that will be suffered by Holders by reason of the failure to file the Exchange
Offer Registration Statement or the Shelf Registration Statement, the failure
of the Exchange Offer Registration Statement or the Shelf Registration
Statement to be declared effective, the failure to consummate the Exchange
Offer or the failure of the Shelf Registration Statement to remain effective,
as the case may be, in accordance with this Agreement.
5. Registration Procedures
In connection with the registration of any Series B Notes or
Transfer Restricted Securities pursuant to Sections 2 or 3 hereof, the Company
and the Subsidiary Guarantors shall effect such registration to permit the sale
of such Series B Notes or Transfer Restricted Securities (as applicable) in
accordance with the intended method or methods of disposition thereof, and
pursuant thereto the Company and the Subsidiary Guarantors shall:
(a) Prepare and file with the SEC, a Registration Statement
or Registration Statements as prescribed by Section 2 or Section 3 hereof, and
to use its reasonable best efforts to cause such Registration Statement to
become effective and remain effective as provided herein; provided that if (1)
such filing is pursuant to Section 3 hereof, or (2) a Prospectus contained in
an Exchange Offer Registration Statement filed pursuant to Section
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2 hereof is required to be delivered under the Securities Act by any
Participating Broker-Dealer who seeks to sell Series B Notes during the
Applicable Period, before filing any Registration Statement or Prospectus or
any amendments or supplements thereto, the Company and the Subsidiary
Guarantors shall furnish to and afford the Holders of the Transfer Restricted
Securities and each such Participating Broker-Dealer, as the case may be,
covered by such Registration Statement, their counsel and the managing
underwriters, if any, a reasonable opportunity to review copies of all such
documents (including copies of any documents to be incorporated by reference
therein and all exhibits thereto) proposed to be filed. Such documents shall
be so furnished at least 3 business days prior to such filing, or such later
date as is reasonable under the circumstances. The Company and the Subsidiary
Guarantors shall not file any Registration Statement or Prospectus or any
amendments or supplements thereto in respect of which the Holders, pursuant to
this Agreement, must be afforded an opportunity to review prior to the filing
of such document, if the Holders of a majority in aggregate principal amount of
the Transfer Restricted Securities covered by such Registration Statement, or
such Participating Broker-Dealer, as the case may be, their counsel, or the
managing underwriters, if any, shall reasonably object within a reasonable time
after receipt of any such materials.
(b) Prepare and file with the SEC such amendments and
post-effective amendments to each Shelf Registration Statement or Exchange
Offer Registration Statement, as the case may be, as may be necessary to keep
such Registration Statement continuously effective for the Effectiveness Period
or the Applicable Period, as the case may be, or such shorter period as will
terminate when all Transfer Restricted Securities covered by such Registration
Statement have been sold; cause the related Prospectus to be supplemented by
any required Prospectus supplement, and as so supplemented to be filed pursuant
to Rule 424 (or any similar provisions then in force) under the Securities Act;
and comply with the applicable provisions of the Securities Act, the Exchange
Act and the rules and regulations of the SEC promulgated thereunder with
respect to the disposition of all securities covered by such Registration
Statement, as so amended, or in such Prospectus, as so supplemented, and with
respect to the subsequent resale of any Series B Notes being sold by a
Participating Broker-Dealer covered by any such Prospectus; the Company or a
Subsidiary Guarantor shall be deemed not to have used its reasonable best
efforts to keep a Registration Statement effective during the Applicable Period
or the Effectiveness Period, as the case may be, if it voluntarily takes any
action that would result in selling Holders of the Transfer Restricted
Securities covered thereby or Participating Broker-Dealers seeking to sell
Series B Notes not being able to sell such Transfer Restricted Securities or
such Series B Notes during such Period, unless (i) such action is required by
applicable law, or (ii) such action is taken by the Company or such Subsidiary
Guarantor in good faith and for valid business reasons (not including avoidance
of its obligations hereunder), including, but not limited to, suspension of the
Registration Statement or other actions taken solely in connection with or in
anticipation of the acquisition or divestiture of assets, material financings
or other transactions effected in good faith for valid business reasons.
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(c) If (1) a Shelf Registration Statement is filed pursuant
to Section 3 hereof, or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required to be
delivered under the Securities Act by any Participating Broker-Dealer who seeks
to sell Series B Notes during the Applicable Period, notify the selling Holders
of Transfer Restricted Securities, or each known Participating Broker-Dealer,
as the case may be, their counsel (if previously identified to the Company in
writing) and the managing underwriters, if any, as promptly as practicable and,
if requested, confirm such notice in writing, (i) when a Prospectus, any
Prospectus supplement or post-effective amendment has been filed, and, with
respect to a Registration Statement or any post-effective amendment, when the
same has become effective (including in any such written notice a statement
that any Holder may, upon request, obtain, without charge, one conformed copy
of such Registration Statement or post-effective amendment including financial
statements and schedules, documents incorporated or deemed to be incorporated
by reference and exhibits), (ii) of the issuance by the SEC of any stop order
suspending the effectiveness of a Registration Statement or of any order
preventing or suspending the use of any Prospectus or the initiation of any
proceedings for that purpose, (iii) if at any time a Prospectus is required by
the Securities Act to be delivered in connection with sales of the Transfer
Restricted Securities or resales of the Series B Notes the representations and
warranties of the Company and the Subsidiary Guarantors contained in any
agreement (including any underwriting agreement) contemplated by Section 5(1)
hereof cease to be true and correct in all material respects, (iv) of the
receipt by the Company of any notification with respect to the suspension of
the qualification or exemption from qualification of a Registration Statement
or any of the Transfer Restricted Securities or the Series B Notes to be sold
by any Participating Broker-Dealer for offer or sale in any jurisdiction, or
the initiation of any proceeding for such purpose, (v) of the happening of any
material event or any material information becoming known that makes any
statement made in such Registration Statement or related Prospectus or any
document incorporated or deemed to be incorporated therein by reference untrue
in any material respect or that requires the making of any changes in such
Registration Statement, Prospectus or documents so that, in the case of the
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 not misleading, and that in the case
of the 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, and (vi) of the Company's reasonable determination
that a post-effective amendment to a Registration Statement would be
appropriate.
(d) If (1) a Shelf Registration Statement is filed pursuant
to Section 3 hereof, or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required to be
delivered under the Securities Act by any Participating Broker-Dealer who seeks
to sell Series B Notes during the Applicable Period, use its reasonable best
efforts to prevent the issuance of any order suspending the effectiveness of a
Registration Statement or of any order preventing or suspending the use of a
Prospectus
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and, if any such order is issued, to use its reasonable best efforts to obtain
the withdrawal of any such order at the earliest possible moment.
(e) If a Shelf Registration Statement is filed pursuant to
Section 3 hereof and if requested by the managing underwriters, if any, or the
Holders of a majority in aggregate principal amount of the Transfer Restricted
Securities being sold in connection with an underwritten offering, (i) as
promptly as practicable incorporate in a prospectus supplement or
post-effective amendment such information relating to underwriters, if any, any
Holder of Transfer Restricted Securities or the plan of distribution of the
Transfer Restricted Securities as the managing underwriter, if any, or such
Holders may reasonably request to be included therein, (ii) make all required
filings of such prospectus supplement or such post-effective amendment as soon
as practicable after the Company has received notification of the matters to be
incorporated in such prospectus supplement or post-effective amendment pursuant
to clause (i), and (iii) supplement or make amendments to such Registration
Statement with such information as is required in connection with any
reasonable request made pursuant to clause (i).
(f) If (1) a Shelf Registration Statement is filed pursuant
to Section 3 hereof, or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required to be
delivered under the Securities Act by any Participating Broker-Dealer who seeks
to sell Series B Notes during the Applicable Period, furnish to each selling
Holder of Transfer Restricted Securities and to each such Participating
Broker-Dealer who so requests and to each managing underwriter, if any, without
charge, one conformed copy of the Registration Statement or Registration
Statements and each post-effective amendment thereto, including financial
statements and schedules, and, if requested, all documents incorporated or
deemed to be incorporated therein by reference and all exhibits.
(g) If (1) a Shelf Registration Statement is filed pursuant
to Section 3 hereof, or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required to be
delivered under the Securities Act by any Participating Broker-Dealer who seeks
to sell Series B Notes during the Applicable Period, deliver to each selling
Holder, or each such Participating Broker-Dealer, as the case may be, its
counsel (if previously identified to the Company in writing), and the
underwriters, if any, without charge, as many copies of the Prospectus or
Prospectuses (including each form of preliminary Prospectus), and each
amendment or supplement thereto and any documents incorporated by reference
therein, as such Persons may reasonably request; and, subject to the last
paragraph of this Section 5 hereof, each of the Company and the Subsidiary
Guarantors hereby consents to the use of such Prospectus and each amendment or
supplement thereto by each of the selling Holders or, during the Applicable
Period, each such Participating Broker-Dealer, as the case may be, and their
underwriters or agents, if any, and dealers, if any, in connection with the
offering and sale of the Transfer Restricted Securities covered by, or the sale
by Participating Broker-Dealers of the Series B Notes pursuant to, such
Prospectus and any amendment or supplement thereto.
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(h) Prior to any public offering of Transfer Restricted
Securities or any delivery of a Prospectus contained in the Exchange Offer
Registration Statement by any Participating Broker-Dealer who seeks to sell
Series B Notes during the Applicable Period, use its reasonable best efforts to
register or qualify and to cooperate with the selling Holders of Transfer
Restricted Securities or each such Participating Broker-Dealer, as the case may
be, the underwriters, if any, and their respective counsel in connection with
the registration or qualification (or exemption from such registration or
qualification) of such Transfer Restricted Securities for offer and sale under
the securities or Blue Sky laws of such jurisdictions as any selling Holder,
Participating Broker-Dealer, or the managing underwriters reasonably request in
writing; keep each such registration or qualification (or exemption therefrom),
effective during the period such Registration Statement is required to be kept
effective and do any and all other acts or things reasonably necessary or
advisable to enable the disposition in such jurisdictions of the Series B Notes
held by Participating Broker-Dealers or the Transfer Restricted Securities
covered by the applicable Registration Statement; provided that the Company and
the Subsidiary Guarantors shall not be required to (A) qualify as a foreign
corporation or as a dealer in securities in any jurisdiction where it is not
then so qualified, (B) take any action that would subject it to general service
of process in any such jurisdiction where it is not then so subject or (C)
subject itself to taxation in any such jurisdiction where it is not then so
subject.
(i) If a Shelf Registration Statement is filed pursuant to
Section 3 hereof, cooperate with the selling Holders of Transfer Restricted
Securities and the managing underwriters, if any, to facilitate the timely
preparation and delivery of certificates representing Transfer Restricted
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 ("DTC"), and enable such Transfer Restricted Securities to be in such
denominations and registered in such names as the managing underwriters, if
any, or Holders may reasonably request at least two business days prior to any
sale of the Transfer Restricted Securities.
(j) If (1) a Shelf Registration Statement is filed pursuant
to Section 3 hereof, or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required to be
delivered under the Securities Act by any Participating Broker-Dealer who seeks
to sell Series B Notes during the Applicable Period, upon the occurrence of any
event contemplated by paragraph 5(c)(v) or 5(c)(vi) above, as promptly as
practicable prepare and (subject to Section 5(a) hereof) file with the SEC, at
the expense of the Company and the Subsidiary Guarantors, a supplement or
post-effective amendment to the Registration Statement or a supplement to the
related Prospectus or any document incorporated or deemed to be incorporated
therein by reference, or file any other required document so that, as
thereafter delivered to the purchasers of the Transfer Restricted Securities
being sold thereunder or to the purchasers of the Series B Notes to whom such
Prospectus will be delivered by a Participating Broker-Dealer, any such
Prospectus will not
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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) Prior to the effective date of the first Registration
Statement relating to the Transfer Restricted Securities, (i) provide the
Trustee with certificates for the Transfer Restricted Securities in a form
eligible for deposit with DTC and (ii) provide a CUSIP number for the Transfer
Restricted Securities.
(l) In connection with an underwritten offering of Transfer
Restricted Securities pursuant to a Shelf Registration Statement, enter into an
underwriting agreement as is customary in underwritten offerings and take all
other customary and appropriate actions as are reasonably requested by the
managing underwriters in order to expedite or facilitate the registration or
the disposition of such Transfer Restricted Securities, and in such connection,
(i) make such representations and warranties to the underwriters, with respect
to the business of the Company and the Subsidiary Guarantors and the
Registration Statement, Prospectus and documents, if any, incorporated or
deemed to be incorporated by reference therein, in each case, as are
customarily made by companies to underwriters in underwritten offerings; (ii)
obtain opinions of counsel to the Company and updates thereof in form and
substance reasonably satisfactory to the managing underwriters, addressed to
the underwriters covering the matters customarily covered in opinions requested
in underwritten offerings and such other matters as may be reasonably requested
by underwriters; (iii) obtain "cold comfort" letters and updates thereof in
form and substance reasonably satisfactory to the managing underwriters 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 or proposed to be acquired by its for which
financial statements and financial data are, or are required to be, included in
the Registration Statement), addressed to each of the underwriters, such
letters to be in customary form and covering matters of the type customarily
covered in "cold comfort" letters in connection with underwritten offerings and
such other matters as are reasonably requested by underwriters as permitted by
Statement on Auditing Standards No. 72; and (iv) if an underwriting agreement
is entered into, the same shall contain indemnification provisions and
procedures no less favorable than those set forth in Section 7 hereof (or such
other reasonable provisions and procedures acceptable to Holders of a majority
in aggregate principal amount of Transfer Restricted Securities covered by such
Registration Statement and the managing underwriters) with respect to all
parties to be indemnified pursuant to said Section. The above shall be done at
each closing under such underwriting agreement, or as and to the extent
required thereunder.
(m) If (1) a Shelf Registration Statement is filed pursuant
to Section 3 hereof, or (2) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required to be
delivered under the Securities Act by any Participating Broker-Dealer who seeks
to sell Series B Notes during the Applicable Period, make
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available for inspection by any selling Holder of such Transfer Restricted
Securities being sold, or each such Participating Broker-Dealer, as the case
may be, any underwriter participating in any such disposition of Transfer
Restricted Securities, if any, and any attorney, accountant or other agent
retained by any such selling Holder or each such Participating Broker-Dealer,
as the case may be, or underwriter (collectively, the "Inspectors"), at the
offices where normally kept, during reasonable business hours, all financial
and other records, pertinent corporate documents and properties of the Company
and its subsidiaries (collectively, the "Records"), as shall be reasonably
necessary to enable them to exercise any applicable due diligence
responsibilities, and cause the officers, directors and employees of the
Company and its subsidiaries to supply all relevant information reasonably
requested by any such Inspector in connection with such Registration Statement.
Records which the Company determines, in good faith, to be confidential and any
Records which it notifies the Inspectors are confidential shall not be
disclosed by the Inspectors, unless (i) the release of such Records is ordered
pursuant to a subpoena or other order from a court of competent jurisdiction or
(ii) the information in such Records has been made generally available to the
public, other than as a result of the disclosure or failure to safeguard by
such Inspector. No information obtained pursuant to this paragraph (m) shall
be used by any person or entity obtaining access thereto in connection with any
transactions in securities of the Company in violation of law. In addition,
notwithstanding anything to the contrary contained herein, the Company and the
Subsidiary Guarantors shall not be required to provide any information to the
Holders or the underwriters that the Company or such Subsidiary Guarantor is
prohibited by law from disclosing.
(n) Provide an indenture trustee for the Transfer
Restricted Securities or the Series B Notes, as the case may be, and cause the
Indenture to be qualified under the TIA not later than the effective date of
the Exchange Offer or the first Registration Statement relating to the Transfer
Restricted Securities; and in connection therewith, cooperate with the trustee
under any such indenture and the Holders of the Transfer Restricted Securities,
to effect such changes to such indenture as may be required for such indenture
to be so qualified in accordance with the terms of the TIA; and execute, and
use its reasonable best efforts to cause such trustee to execute, all customary
documents as may be required to effect such changes, and all other forms and
documents required to be filed with the SEC to enable such indenture to be so
qualified in a timely manner.
(o) Comply with all applicable rules and regulations of the
SEC and, as soon as reasonably practicable after the effective date of the
applicable Registration Statement, make generally available to the holders of
Series B Notes and the Holders, if any, a consolidated earning statement of the
Company (which need not be certified by an independent public accountant) that
satisfies the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder.
(p) If an Exchange Offer is to be consummated, upon
delivery of the Transfer Restricted Securities by Holders to the Company (or to
such other Person as directed by the
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Company), in exchange for the Series B Notes, the Company shall, where
appropriate, xxxx or cause to be marked on such Transfer Restricted Securities
that such Transfer Restricted Securities are being cancelled in exchange for
the Series B Notes; in no event shall such Transfer Restricted Securities be
marked as paid or otherwise satisfied.
(q) Cooperate with each seller of Transfer Restricted
Securities covered by any Registration Statement and each underwriter, if any,
participating in the disposition of such Transfer Restricted Securities and
their respective counsel in connection with any filings required to be made
with the National Association of Securities Dealers, Inc. (the "NASD").
(r) Use its reasonable best efforts to take all other steps
necessary to effect the registration of the Transfer Restricted Securities
covered by a Registration Statement contemplated hereby.
(s) Use its reasonable best efforts to cause the Transfer
Restricted Securities or the Series B Notes, as applicable, covered by an
effective registration statement required by Section 2 or Section 3 hereof to
be rated by one or two rating agencies, if and as so requested by the Holders
of a majority in aggregate principal amount of Transfer Restricted Securities
relating to such registration statement or the managing underwriters in
connection therewith, if any.
The Company and the Subsidiary Guarantors may require each
seller of Transfer Restricted Securities or Participating Broker-Dealer as to
which any registration is being effected to furnish to the Company such
information regarding such seller or Participating Broker-Dealer and the
distribution of such Transfer Restricted Securities or Series B Notes to be
sold by such Participating Broker-Dealer, as the case may be, as the Company
may, from time to time, reasonably request. The Company and the Subsidiary
Guarantors may exclude from such registration the Transfer Restricted
Securities or Series B Notes of any seller or Participating Broker-Dealer, as
the case may be, who fails to furnish such information within a reasonable time
(and in any event within ten business days) after receiving such request. Each
seller of Transfer Restricted Securities as to which a Shelf Registration is
being effected, and each Participating Broker-Dealer utilizing a Prospectus
from the Exchange Offer Registration Statement, agrees to furnish reasonably
promptly to the Company all information required to be disclosed in order to
make any information previously furnished to the Company by such seller or
Participating Broker-Dealer not materially misleading. No such seller or
Participating Broker Dealer, as applicable, shall be entitled to Liquidated
Damages pursuant to Section 4 hereof if such person fails so to provide all
such reasonably requested information to the extent that any such failure by
such person is the primary reason for the assessment of Liquidated Damages.
Each Holder of Transfer Restricted Securities and each
Participating Broker-Dealer agrees by acquisition of such Transfer Restricted
Securities or Series B Notes to be
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sold by such Participating Broker-Dealer, as the case may be, that, upon
receipt of any notice from the Company of the happening of any event of the
kind described in Section 5(c)(ii), 5(c)(iv), 5(c)(v) or 5(c)(vi) hereof, such
Holder shall forthwith discontinue disposition of such Transfer Restricted
Securities covered by such Registration Statement or Prospectus or such Series
B Notes to be sold by such Participating Broker-Dealer, as the case may be,
until such Holder's or Participating Broker-Dealer's receipt of the copies of
the supplemented or amended Prospectus contemplated by Section 5(j) hereof, or
until it is advised in writing by the Company that the use of the applicable
Prospectus may be resumed, and has received copies of any amendments or
supplements thereto. In the event the Company gives any such notice, and
subsequently delivers to each Holder or Participating Broker-Dealer copies of
such supplemented or amended Prospectus, then each Holder or Participating
Broker-Dealer will either destroy or return to the Company all copies (other
than permanent file copies then in such Holder's or Participating
Broker-Dealer's possession) of any Prospectus that, as a result of such
occurrence leading to such notice, is no longer accurate.
6. Registration Expenses
(a) All fees and expenses incident to the performance of or
compliance with this Agreement by the Company and the Subsidiary Guarantors
shall be borne by the Company and the Subsidiary Guarantors, whether or not the
Exchange Offer or a Shelf Registration Statement is filed or becomes effective,
including, without limitation, (i) all registration and filing fees (including,
without limitation, (A) fees with respect to filings required to be made with
the NASD in connection with an underwritten offering and (B) fees and expenses
of compliance with state securities or Blue Sky laws (including, without
limitation, reasonable fees and disbursements of counsel in connection with
Blue Sky qualifications of the Transfer Restricted Securities or Series B
Notes), (ii) printing expenses (including, without limitation, expenses of
printing certificates for Transfer Restricted Securities or Series B Notes in a
form eligible for deposit with DTC and of printing Prospectuses if the printing
of Prospectuses is requested by the managing underwriters, if any, or, in
respect of Transfer Restricted Securities or Series B Notes to be sold by any
Participating Broker-Dealer during the Applicable Period, by the Holders of a
majority in aggregate principal amount of the Transfer Restricted Securities
included in any Registration Statement or of such Series B Notes, as the case
may be), (iii) fees and disbursements of counsel for the Company, (iv) fees and
disbursements of all independent certified public accountants referred to in
Section 5(i)(iii) hereof (including, without limitation, the expenses of any
special audit and "cold comfort" letters required by or incident to such
performance), (v) the fees and expenses of any "qualified independent
underwriter" or other independent appraiser participating in an offering
pursuant to Section 3 of Schedule E to the By-laws of the NASD, (vi) rating
agency fees, (vii) fees and expenses of all other Persons retained by the
Company and the Subsidiary Guarantors, (viii) internal expenses of the Company
and the Subsidiary Guarantors (including, without limitation, all salaries and
expenses of officers and employees of the Company and the Subsidiary Guarantors
performing legal or
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accounting duties), (ix) the expense of any required financial audits and (x)
the fees and expenses incurred in connection with the listing of the securities
to be registered on any securities exchange. Nothing contained in this Section
6 shall create an obligation on the part of the Company and the Subsidiary
Guarantors to pay or reimburse any Holder for any underwriting commission or
discount attributable to any such Holder's Transfer Restricted Securities
included in an underwritten offering pursuant to a Registration Statement filed
in accordance with the terms of this Agreement, or to guarantee such Holder any
profit or proceeds from the sale of such Series A Notes.
(b) In connection with any Shelf Registration Statement
hereunder, the Company and the Subsidiary Guarantors shall reimburse the
Holders of the Transfer Restricted Securities being registered in such
registration for the reasonable fees and disbursements of not more than one
firm of attorneys chosen by the Holders of a majority in aggregate principal
amount of the Transfer Restricted Securities to be included in such
Registration Statement.
7. Indemnification
The Company and the Subsidiary Guarantors agree to indemnify
and hold harmless (i) each of the Initial Purchasers, each Holder of Transfer
Restricted Securities, each Holder of Series B Notes and each Participating
Broker-Dealer, (ii) each person, if any, who controls (within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act) any such
Person (any of the persons referred to in this clause (ii) being hereinafter
referred to as a "controlling person"), and (iii) the respective officers,
directors, partners, employees, representatives and agents of any of such
Person or any controlling person (any person referred to in clause (i), (ii) or
(iii) may hereinafter be referred to as an "Indemnified Person") to the fullest
extent lawful, from and against any and all losses, claims, damages,
liabilities, judgments, actions and reasonable expenses (including, without
limitation, and as incurred, reimbursement of all reasonable costs of
investigating, preparing, pursuing or defending any claim or action or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, including the reasonable fees and expenses of counsel to any
Indemnified Person) caused by, related to, based upon, arising out of or in
connection with any untrue statement or alleged untrue statement of a material
fact contained in any Registration Statement or Prospectus (as amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto) or any preliminary Prospectus, or caused by, arising out of or based
upon any omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading, except insofar as
such losses, claims, damages, liabilities or expenses are caused by (i) any
untrue statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with information relating to any Indemnified
Person furnished to the Company or any underwriter in writing by such
Indemnified Person expressly for use therein, or (ii) any untrue statement
contained in or omission from a
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preliminary Prospectus or Prospectus, as applicable, if a copy of the
Prospectus (as then amended or supplemented, if the Company shall have
furnished to or on behalf of the Holder participating in the distribution
relating to the relevant Registration Statement any amendments or supplements
thereto) was not sent or given by or on behalf of such Holder to the person
asserting any such losses, liabilities, claims, damages or expenses who
purchased Series A Notes, if such is required by law at or prior to the written
confirmation of the sale of such Series A Notes to such person and the untrue
statement contained in or omission from such preliminary Prospectus or
Prospectus, as applicable, was corrected in the Prospectus (as then amended or
supplemented). The Company and the Subsidiary Guarantors shall notify the
Holders promptly upon becoming aware thereof of the institution, threat or
assertion of any claim, proceeding (including any governmental investigation)
or litigation of which it shall have become aware in connection with the
matters addressed by this Agreement which involves the Company, a Subsidiary
Guarantor or an Indemnified Person.
In connection with any Registration Statement in which a
Holder of Transfer Restricted Securities is participating, such Holder of
Transfer Restricted Securities agrees, severally and not jointly, to indemnify
and hold harmless the Company and the Subsidiary Guarantors and their
directors, officers, partners, employees, representatives and agents and each
person who controls the Company within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act to the same extent as the
foregoing indemnity from the Company and the Subsidiary Guarantors to each
Indemnified Person, but only with reference to information relating to such
Indemnified Person and furnished to the Company in writing by such Indemnified
Person expressly for use in any Registration Statement or Prospectus, any
amendment or supplement thereto, or any preliminary Prospectus. The liability
of any Indemnified Person pursuant to this paragraph shall in no event exceed
the proceeds (net of reasonable commissions) received by such Indemnified
Person from sales of Transfer Restricted Securities or Series B Notes giving
rise to such obligations.
If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted against
any person in respect of which indemnity may be sought pursuant to either of
the two preceding paragraphs, such person (the "indemnified party") shall
promptly notify the person against whom such indemnity may be sought (the
"indemnifying person") in writing, (provided that the failure to give such
notice shall not relieve the indemnifying person of its obligations under this
Section 7 unless and only to the extent that the indemnifying person is
materially prejudiced by the failure to notify) and the indemnifying person,
upon request of the indemnified party, shall retain counsel reasonably
satisfactory to the indemnified party to represent the indemnified party and
any others indemnifying person may reasonably designate in such proceeding and
shall pay the reasonable fees and expenses actually incurred by 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 person and the indemnified
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party shall have mutually agreed in writing to the contrary, (ii) the
indemnifying person shall have failed promptly to assume the defense and employ
counsel reasonably satisfactory to the indemnified party or (iii) the named
parties to any such action (including any impleaded parties) include both such
indemnified party and the indemnifying person, or any affiliate of the
indemnifying person and such indemnified party shall have reasonably advised by
counsel that representation of such indemnified party and any such indemnifying
party by the same counsel would be inappropriate under applicable standards of
professional conduct (whether or not such representation by the same counsel
has been proposed) due to actual or potential differing interests between them
(in which case the indemnifying person shall not have the right to assume the
defense of such action on behalf of such indemnified party), it being
understood, however, that the indemnifying person shall not, in connection with
any one such action or separate but substantially similar or related actions in
the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of more than one
separate firm of attorneys (in addition to any local counsel) for all such
indemnified parties, which firm shall be reasonably satisfactory to the
indemnifying parties. Such separate firm for sellers of Transfer Restricted
Securities shall be designated in writing by those indemnified parties who sold
a majority in outstanding aggregate principal amount of Transfer Restricted
Securities sold by all such indemnified parties, and any such separate firm for
the Company, the Subsidiary Guarantors, their directors, their officers and
such control persons of the Company and the Subsidiary Guarantors shall be
designated in writing by the Company. The indemnifying person shall not be
liable for any settlement of any proceeding effected without its written
consent, but if settled with such consent or if there be a final judgment for
the plaintiff, the indemnifying person agrees to indemnify any indemnified
party from and against any loss or liability by reason of such settlement or
judgment to the extent of such indemnifying party's indemnification obligation
hereunder. No indemnifying person shall, without the prior written consent of
the indemnified party, 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 includes an unconditional release of such indemnified
party from all liability on claims that are the subject matter of such
proceeding.
If the indemnification provided for in the first and second
paragraphs of this Section 7 is unavailable to an indemnified party in respect
of any losses, claims, damages, liabilities, or expenses referred to therein
(other than by reason of the exceptions provided therein), then each
indemnifying person under such paragraphs, 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,
liabilities, or expenses (i) in such proportion as is appropriate to reflect
the relative benefits received by the indemnified party on the one hand and the
indemnifying person(s) on the other in connection with the statements or
omissions that resulted in such losses, claims, damages, liabilities, or
expenses or (ii) if the allocation provided by clause (i) above is not
permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause
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(i) above but also the relative faults of the indemnifying person(s) and the
indemnified party, as well as any other relevant equitable considerations. The
relative fault of the Company and the Subsidiary Guarantors on the one hand an
any Indemnified Persons on the other 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 and the Subsidiary Guarantors or by such
Indemnified Persons and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The parties agrees that it would not be just and equitable if
contribution pursuant to this Section 7 were determined by pro rata allocation
(even if such indemnified parties were treated as one entity for such purpose
or by any other method of allocation that does not take account of the
equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an indemnified party as a result of the losses,
claims, damages, liabilities and expenses referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any reasonable legal or other expenses actually incurred by such
indemnified party in connection with investigating or defending any such action
or claim. Notwithstanding the provisions of this Section 7, in no event shall
an Indemnified Person be required to contribute any amount in excess of the
amount by which proceeds received by such Indemnified Person from sales of
Transfer Restricted Securities or Series B Notes exceeds the amount of any
damages that such Indemnified Person 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.
The indemnity and contribution agreements contained in this
Section 7 will be in addition to any liability which the indemnifying parties
may otherwise have to the indemnified parties referred to above. The
Indemnified Persons' obligations to contribute pursuant to this Section 7 are
several in proportion to the respective principal amount of Securities sold by
each of the Indemnified Persons hereunder and not joint.
8. Rules 144 and 144A
Each of the Company and the Subsidiary Guarantors covenants
that it will file the reports required to be filed by it pursuant to the
Securities Act and the Exchange Act and the rules and regulations adopted by
the SEC thereunder in a timely manner and, if at any time the Company or a
Subsidiary Guarantor is not required to file such reports, it will, upon the
reasonable request of any Holder of Transfer Restricted Securities, make
available information required by Rule 144 and Rule 144A under the Securities
Act in order to permit sales pursuant to Rule 144 and Rule 144A. Each of the
Company and the Subsidiary Guarantors further covenants that it will take such
further action as any Holder of Transfer
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Restricted Securities may reasonably request, all to the extent required from
time to time to enable such Holder to sell Transfer Restricted Securities
without registration under the Securities Act within the limitation of the
exemptions provided by (a) Rule 144 and Rule 144A, or (b) any similar rule or
regulation hereafter adopted by the SEC (it being expressly understood that the
foregoing shall not create any obligation on the part of the Company or any
Subsidiary Guarantor to file periodic or other reports under the Exchange Act
at any time that it is not otherwise required to file such reports pursuant to
the Exchange Act).
9. Underwritten Registrations
(a) If any of the Transfer Restricted Securities covered by
any Shelf Registration Statement 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 Holders of a majority in aggregate
principal amount of such Transfer Restricted Securities included in such
offering and shall be reasonably acceptable to the Company.
No Holder of Transfer Restricted Securities may participate in
any underwritten registration hereunder, unless such Holder (a) agrees to sell
such Holder's Transfer Restricted Securities on the basis provided in any
underwriting arrangements approved by the Persons entitled hereunder to approve
such arrangements and (b) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents required
under the terms of such underwriting arrangements.
(b) Each Holder of Transfer Restricted Securities agrees,
if requested (pursuant to a timely written notice) by the managing underwriters
in an underwritten offering or by a placement agent in a private offering of
the Company's debt securities, not to effect any private sale or distribution
(including a sale pursuant to Rule 144(k) or Rule 144A under the Securities
Act, but excluding non-public sales to any of its affiliates, officers,
directors, employees and controlling persons), of any of the Series A Notes,
except pursuant to an Exchange Offer, during the period beginning 10 days prior
to, and ending 90 days after, the closing date of the underwritten or private
offering, as applicable.
The foregoing provisions shall not apply to any Holder of
Transfer Restricted Securities if such Holder is prevented by applicable
statute or regulation from entering into any such agreement; provided, however,
that if it receives a written request as provided in the preceding paragraph,
no such Holder shall effect any disposition of Series A Notes that would
otherwise be restricted by the provisions of the preceding paragraph without
providing reasonable advance written notice of such disposition to the Company,
the managing underwriter or the placement agent, as the case may be.
Each of the Company and the Subsidiary Guarantors agrees,
without the written consent of the managing underwriters in an underwritten
offering of Transfer Restricted Securities covered by a Registration Statement
filed pursuant to Section 3 hereof,
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not to effect any public or private sale or distribution of its respective debt
securities, including a sale pursuant to Regulation D or Rule 144A under the
Securities Act, during the period beginning 10 days prior to, and ending 90
days after, the closing date of each underwritten offering made pursuant to
such Registration Statement (provided, however, that such period shall be
extended by the number of days from and including the date of the giving of any
notice pursuant to Section 5(c)(v) or (c)(vi) hereof to and including the date
when each seller of Transfer Restricted Securities covered by such Registration
Statement shall have received the copies of the supplemented or amended
Prospectus contemplated by Section 5(j) hereof).
10. Miscellaneous
(a) No Inconsistent Agreements. The Company and the
Subsidiary Guarantors have not, as of the date hereof, and the Company and the
Subsidiary Guarantors shall not, after the date of this Agreement, enter into
any agreement with respect to any of its securities that is inconsistent with
the rights granted to the Holders of Transfer Restricted Securities in this
Agreement or otherwise conflicts with the provisions hereof. The Company and
the Subsidiary Guarantors will not enter into any agreement with respect to any
of their securities which will grant to any Person piggy-back registration
rights with respect to a Registration Statement.
(b) Amendments and Waivers. The provisions of this
Agreement, including the provisions of this sentence, may not be amended,
modified or supplemented, and waivers or consents to or departures from the
provisions hereof may not be given, unless the Company has obtained the written
consent of Holders of at least a majority of the then outstanding aggregate
principal amount of Transfer Restricted Securities. Notwithstanding the
foregoing, a waiver or consent to or departures 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, impair, limit or compromise the rights of
other Holders may be given by Holders of at least a majority in aggregate
principal amount of the Transfer Restricted Securities being sold by such
Holders pursuant to such Registration Statement; provided that the provisions
of this sentence may not be amended, modified or supplemented except in
accordance with the provisions of the immediately preceding sentence.
(c) Notices. All notices and other communications
(including, without limitation, any notices or other communications to the
Trustee), provided for or permitted hereunder shall be made in writing by
hand-delivery, registered first-class mail, next-day air courier or telecopier:
(i) if to a Holder of Transfer Restricted Securities, at
the most current address given by the Trustee to the Company;
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(ii) if to the Company or any Subsidiary Guarantor, Liberty
Group Operating, Inc., 0000 Xxxxxx Xxxx, Xxxxxxxxxx, Xxxxxxxx 00000,
Attention: Xxxxxxx X. Xxxxxx, President, with a copy to Xxxxxxx Xxxxx
& Partners, L.P., 00000 Xxxxx Xxxxxx Xxxxxxxxx, Xxxxx 0000, Xxx
Xxxxxxx, Xxxxxxxxxx 00000, Attention: Xxxxx X. Xxxxx, and with a copy
to Xxxxx, Xxxxx & Xxxxx, 000 Xxxxx Xx Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx
00000, Attention: Xxxxx X. Xxxxx, Esq.; and
(iii) if to any Initial Purchasers, c/x Xxxxxxxxx, Xxxxxx &
Xxxxxxxx Securities Corporation, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Syndicate Department, with a copy to Xxxxxxxx &
Xxxxxxxx, 000 Xxxxx Xxxxxx Xxxxxx, Xxx Xxxxxxx, Xxxxxxxxxx 00000-0000,
Attention: Xxxxxx X. Xxxxxxx, Esq.
All such notices and communications shall be deemed to have
been duly given: when delivered by hand, if personally delivered; five business
days after being deposited in the mail, postage prepaid, if mailed; one
business day after being timely delivered to a nationally recognized next-day
air courier, if made by next-day air courier; and when receipt is acknowledged
by the addressee, if telecopied on a business day on such business day, if not
on a business day, on the first business day thereafter.
Copies of all such notices, demands or other communications
shall be concurrently delivered by the Person giving the same to the Trustee
under the Indenture at the address specified in such Indenture.
(d) Successors and Assigns. This Agreement shall inure to
the benefit of and be binding upon the successors and assigns of each of the
parties hereto, including, without limitation and without the need for an
express assignment, subsequent Holders of Transfer Restricted Securities. The
Company and the Subsidiary Guarantors agree that the Holders of the Series A
Notes shall be third-party creditor beneficiaries to the agreements made
hereunder by the Initial Purchasers, the Company and the Subsidiary Guarantors,
and each Holder shall have the right to enforce such agreements directly to the
extent it deems such enforcement necessary or advisable to protect its rights
hereunder.
(e) 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.
(f) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(g) Governing Law. 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, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW.
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(h) Severability. 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 best 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 hereto 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) Entire Agreement. This Agreement, together with the
Purchase Agreement, is intended by the parties hereto as a final expression of
their agreement, and is intended to be a complete and exclusive statement of
the agreement and understanding of the parties hereto in respect to the subject
matter contained herein and therein. Any and all prior oral or written
agreements, representations, warranties, contracts, understandings,
correspondence, conversations and memoranda between the Initial Purchasers, on
the one hand, and the Company and the Subsidiary Guarantors, on the other, or
between or among any agents, representatives, parents, subsidiaries,
affiliates, predecessors in interest or successors in interest with respect to
the subject matter hereof are merged herein and replaced hereby.
(j) Series A Notes Held by the Company or its Affiliates.
Whenever the consent or approval of Holders of a specified percentage of
Transfer Restricted Securities is required hereunder, Transfer Restricted
Securities held by the Company or its affiliates (as such term is defined in
Rule 405 under the Securities Act) (other than the Initial Purchasers or
subsequent Holders of Transfer Restricted Securities or Series B Notes if such
subsequent Holders are deemed to be affiliates solely by reason of their
holdings of such Transfer Restricted Securities or Series B Notes), shall not
be counted in determining whether such consent or approval was given by the
Holders of such required percentage.
(k) Survival. This Agreement is intended to survive the
consummation of the transactions contemplated by the Purchase Agreement. The
indemnification and contribution obligations under section 7 of this Agreement
shall survive the termination of the Company's and the Subsidiary Guarantors'
obligations under sections 2 and 3 of this Agreement.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
LIBERTY GROUP OPERATING, INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President and Chief
Executive Officer
LIBERTY GROUP ARIZONA HOLDINGS,
INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
LIBERTY GROUP ARKANSAS HOLDINGS,
INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
LIBERTY GROUP CALIFORNIA
HOLDINGS, INC. d/b/a LGP
CALIFORNIA HOLDINGS, INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
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LIBERTY GROUP ILLINOIS HOLDINGS,
INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
LIBERTY GROUP IOWA HOLDINGS, INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
LIBERTY GROUP KANSAS HOLDINGS,
INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
LIBERTY GROUP MICHIGAN HOLDINGS,
INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
LIBERTY GROUP MINNESOTA HOLDINGS,
INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
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LIBERTY GROUP MISSOURI HOLDINGS,
INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
LIBERTY GROUP NEW YORK HOLDINGS,
INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
LIBERTY GROUP PENNSYLVANIA
HOLDINGS, INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
LIBERTY GROUP MANAGEMENT
SERVICES, INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
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The foregoing Registration Rights
Agreement is hereby confirmed and
accepted as of the date first
above written.
XXXXXXXXX, LUFKIN & XXXXXXXX
SECURITIES CORPORATION
By: /s/ Xxxxxx X. Xxxxxx
--------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Senior Vice President
CITICORP SECURITIES, INC.
By: /s/ Xxxxxx Xxxxxxxxx
--------------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Vice President
BT ALEX. XXXXX
By: /s/ Xxxxxxx Xxxx
--------------------------------------
Name: Xxxxxxx Xxxx
Title: Managing Director
CHASE SECURITIES INC.
By: /s/ Xxxxx Xxxx
--------------------------------------
Name: Xxxxx Xxxx
Title: Managing Director
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