EXECUTION COPY
XXXXXXX & XXXXX, INC.
$85,000,000
12.25% Series A Senior Notes Due 2003
REGISTRATION RIGHTS AGREEMENT
December 20, 1996
Xxxxxx, Read & Co. Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Ladies and Gentlemen:
Xxxxxxx & Xxxxx, Inc., a Delaware corporation (the "Company"), proposes to
issue and sell to Xxxxxx, Read & Co. Inc. (the "Initial Purchaser"), upon the
terms set forth in a purchase agreement of even date herewith (the "Purchase
Agreement"), $85,000,000 aggregate principal amount of its 12.25% Series A
Senior Notes Due 2003 (the "Senior Notes") to be unconditionally guaranteed on a
senior unsecured basis by each of the subsidiaries identified on Schedule I
hereto (the "Subsidiary Guarantors"). The Senior Notes will be issued pursuant
to an Indenture, to be dated as of the Closing Date (as defined in the Purchase
Agreement) (the "Indenture"), among the Company, the Subsidiary Guarantors and
IBJ Xxxxxxxx Bank & Trust Company, as trustee (the "Trustee"). As an inducement
to the Initial Purchaser, the Company and the Subsidiary Guarantors agree with
the Initial Purchaser, for the benefit of the holders of the Senior Notes
(including, without limitation, the Initial Purchaser), the Exchange Notes (as
defined below) and the Private Exchange Notes (as defined below) (collectively,
the "Holders"), as follows:
1. Exchange Offer. The Company shall, at its cost, prepare and, not later
than 90 days after (or if such 90th day is not a business day, the first
business day thereafter) the original date of issue of the Senior Notes (the
"Issue Date") of the Senior Notes, file with the Securities and Exchange
Commission (the "Commission") a registration statement (the "Exchange Offer
Registration Statement") on an appropriate form under the Securities Act of
1933, as amended (the "Securities Act"), with respect to a proposed offer (the
"Exchange Offer") to the Holders of Transfer Restricted Notes (as defined in
Section 6 hereof), who are not prohibited by any law or policy of the Commission
from participating in the Exchange Offer, to issue and deliver to such Holders,
in exchange for the Senior Notes, a like aggregate principal amount of debt
securities
(the "Exchange Notes") of the Company issued under the Indenture and identical
in all material respects to the Senior Notes (except for the transfer
restrictions relating to the Senior Notes) that would be registered under the
Securities Act. The Company shall use its best efforts to cause such Exchange
Offer Registration Statement to become effective under the Securities Act within
150 days (or if such 150th day is not a business day, the first business day
thereafter) after the Issue Date of the Senior Notes and shall keep the Exchange
Offer Registration Statement effective for not fewer than 20 business days (or
longer, if required by applicable law) after the date on which notice of the
Exchange Offer is mailed to the Holders (such period being called the "Exchange
Offer Registration Period").
If the Company effects the Exchange Offer, the Company will be entitled to
close the Exchange Offer 20 business days after the commencement thereof,
provided that the Company has accepted all the Senior Notes theretofore validly
tendered in accordance with the terms of the Exchange Offer.
Following the declaration of the effectiveness of the Exchange Offer
Registration Statement, the Company shall promptly commence the Exchange Offer,
it being the objective of such Exchange Offer to enable each Holder of Transfer
Restricted Notes (as defined in Section 6 hereof) electing to exchange the
Senior Notes for Exchange Notes (assuming that such Holder is not an affiliate
of the Company within the meaning of the Securities Act, acquires the Exchange
Notes in the ordinary course of such Holder's business and does not intend and
has no arrangements or understandings with any person to participate in the
distribution of the Exchange Notes and is not prohibited by any law or policy of
the Commission from participating in the Exchange Offer) to trade such Exchange
Notes from and after their receipt without any limitations or restrictions under
the Securities Act and without material restrictions under the securities laws
of the several states of the United States. In connection with such Exchange
Offer, the Company shall take such further action, including, without
limitation, appropriate filings under state securities laws, as may be necessary
to realize the foregoing objective subject to the proviso of Section 3(h).
The Company acknowledges that, pursuant to current interpretations by the
Commission's staff of Section 5 of the Securities Act, in the absence of an
applicable exemption therefrom, (i) each Holder that is a broker-dealer electing
to exchange Senior Notes, acquired for its own account as a result of market
making activities or other trading activities, for Exchange Notes (an
"Exchanging Dealer"), is required to deliver a prospectus containing the
information set forth in Annex A hereto on the cover, in Annex B hereto in the
"Exchange Offer Procedures" section and the "Purpose of the Exchange Offer"
section, and in Annex C hereto in the "Plan of Distribution" section of such
prospectus in connection with a sale of any such Exchange Notes received by such
Exchanging Dealer pursuant to the Exchange Offer and (ii) the Initial Purchaser,
if it elects to sell Exchange Notes acquired in exchange for Senior Notes
constituting any portion of an unsold allotment, is required to deliver a
prospectus containing the information required by Items 507 or 508 of Regulation
S-K under the Securities Act, as applicable, in connection with such sale.
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The Company shall use its reasonable efforts to keep the Exchange Offer
Registration Statement effective 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 such persons must comply with such requirements
in order to resell the Exchange Notes; provided, however, that (i) in the case
where such prospectus and any amendment or supplement thereto must be delivered
by an Exchanging Dealer or the Initial Purchaser, such period shall be the
lesser of 180 days and the date on which all Exchanging Dealers and the Initial
Purchaser have sold all Exchange Notes held by them (unless such period is
extended pursuant to Section 3(j) below) and (ii) the Company shall make such
prospectus and any amendment or supplement thereto available to any
broker-dealer for use in connection with any resale of any Exchange Notes for a
period not less than 90 days after the consummation of the Exchange Offer.
If, upon consummation of the Exchange Offer, the Initial Purchaser holds
Senior Notes acquired by it as part of its initial distribution, the Company,
simultaneously with the delivery of the Exchange Notes pursuant to the Exchange
Offer, shall issue and deliver to the Initial Purchaser upon the written request
of the Initial Purchaser in exchange (the "Private Exchange") for the Senior
Notes held by the Initial Purchaser, a like principal amount of debt securities
of the Company issued under the Indenture and identical in all material respects
(including the existence of restrictions on transfer under the Securities Act
and the securities laws of the several states of the United States) to the
Senior Notes (the "Private Exchange Notes"). The Senior Notes, the Exchange
Notes and the Private Exchange Notes are herein collectively called the
"Securities".
In connection with the Exchange Offer, the Company shall:
(a) 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;
(b) keep the Exchange Offer open for not less than 20 business days
(or longer, if required by applicable law) after the date notice thereof
is mailed to the Holders;
(c) utilize the services of a depositary for the Exchange Offer with
an address in the Borough of Manhattan, The City of New York, which may be
the Trustee or an affiliate of the Trustee;
(d) permit Holders to withdraw tendered Senior 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; and
(e) otherwise comply in all material respects with all applicable
laws.
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As soon as practicable after the close of the Exchange Offer or the
Private Exchange, as the case may be, the Company shall:
(i) accept for exchange all the Senior Notes validly tendered and
not withdrawn pursuant to the Exchange Offer and the Private Exchange;
(ii) deliver to the Trustee for cancellation all the Senior Notes so
accepted for exchange; and
(iii) cause the Trustee to authenticate and deliver promptly to each
Holder of the Senior Notes, Exchange Notes or Private Exchange Notes, as
the case may be, equal in principal amount to the Senior Notes of such
Holder so accepted for exchange.
Each Holder participating in the Exchange Offer shall be required to
represent to the Company that at the time of the consummation of the Exchange
Offer (i) any Exchange Notes received by such Holder will be acquired in the
ordinary course of business, (ii) such Holder will have no arrangements or
understandings with any person to participate in the distribution of the Senior
Notes or the Exchange Notes within the meaning of the Securities Act, (iii) such
Holder is not an "affiliate," as defined in Rule 405 of the Securities Act, of
the Company or any Subsidiary Guarantor or if it is an affiliate, such Holder
will comply with the registration and prospectus delivery requirements of the
Securities Act to the extent applicable, (iv) if such Holder is not a
broker-dealer, that it is not engaged in, and does not intend to engage in, the
distribution of the Exchange Notes and (v) if such Holder is a broker-dealer,
that it will receive Exchange Notes for its own account in exchange for Senior
Notes that were acquired as a result of market-making activities or other
trading activities and that it will be required to acknowledge that it will
deliver a prospectus in connection with any resale of such Exchange Notes.
Notwithstanding any other provisions hereof, the Company will ensure that
(i) any Exchange Offer Registration Statement and any amendment thereto and any
prospectus forming part thereof and any supplement thereto complies as to form
in all material respects with the Securities Act and the rules and regulations
thereunder, (ii) any Exchange Offer 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 Exchange Offer Registration Statement, and any supplement to
such prospectus, does not, as of its date, include an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
2. Shelf Registration. If, (i) because of any change in law or in
applicable interpretations thereof by the staff of the Commission, the Company
is not permitted to effect a Exchange Offer as contemplated by Section 1 hereof,
(ii) the Exchange Offer is not consummated within 180 days after the date of
original issue of the Senior Notes (or, if such 180th day is not
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a business day, the first business day thereafter), (iii) the Initial Purchaser
so requests within six month after consummation of the Exchange Offer with
respect to the Senior Notes (or any Private Exchange Notes) not eligible to be
exchanged for Exchange Notes in the Exchange Offer and held by it following
consummation of the Exchange Offer or (iv) any Holder (other than an Exchanging
Dealer) is not eligible to participate in the Exchange Offer or, in the case of
any Holder (other than an Exchanging Dealer) that participates in the Exchange
Offer, such Holder does not receive freely tradeable Exchange Notes on the date
of the exchange and such Holder notifies the Company within six months of such
date, the Company shall take the following actions:
(a) The Company shall, at its cost, as promptly as practicable (but
in no event more than 30 days after so required or requested pursuant to
this Section 2) file with the Commission and thereafter shall use its best
efforts to cause to be declared effective a registration statement (the
"Shelf Registration Statement" and, together with the Exchange Offer
Registration Statement, a "Registration Statement") on an appropriate form
under the Securities Act relating to the offer and sale of the Transfer
Restricted Notes (as defined below) by the Holders thereof from time to
time in accordance with the methods of distribution set forth in the Shelf
Registration Statement and Rule 415 under the Securities Act (hereinafter,
the "Shelf Registration"); provided, however, that no Holder (other than
an Initial Purchaser) shall be entitled to have the Securities held by it
covered by such Shelf Registration Statement unless such Holder agrees in
writing to be bound by all the provisions of this Agreement applicable to
such Holder.
(b) The Company shall use its best efforts to keep the Shelf
Registration Statement continuously effective in order to permit the
prospectus included therein to be lawfully delivered by the Holders of the
relevant Securities, until the earlier of (i) the time when the Securities
covered by the Shelf Registration Statement can be sold pursuant to Rule
144(k) thereof, and (ii) the date on which all of the Securities covered
by the Shelf Registration Statement have been sold pursuant thereto.
Subject to Section 6(b), the Company shall be deemed not to have used its
best efforts to keep the Shelf Registration Statement effective during the
requisite period if it voluntarily takes any action that would result in
Holders of Securities covered thereby not being able to offer and sell
such Securities during that period, unless such action is required by
applicable law.
(c) Notwithstanding any other provisions of this Agreement to the
contrary, the Company shall cause the Shelf Registration Statement and the
related prospectus and any amendment or supplement thereto, as of the
effective date of the Shelf Registration Statement, amendment or
supplement, (i) to comply as to form in all material respects with the
applicable requirements of the Securities Act and the rules and
regulations of the Commission and (ii) not to contain any untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading.
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3. Registration Procedures. In connection with any Shelf Registration
contemplated by Section 2 hereof and, to the extent applicable, any Exchange
Offer contemplated by Section 1 hereof, the following provisions shall apply:
(a) The Company shall (i) furnish to the Initial Purchaser, prior to
the filing thereof with the Commission, a copy of the Registration
Statement and each amendment thereof and each supplement, if any, to the
prospectus included therein and, in the event that the Initial Purchaser
(with respect to any portion of an unsold allotment from the original
offering) is participating in the Exchange Offer or the Shelf Registration
Statement, shall use its best efforts to reflect in each such document,
when so filed with the Commission, such comments as the Initial Purchaser
reasonably may propose; (ii) include the information set forth in Annex A
hereto on the cover, in Annex B hereto in the "Exchange Offer Procedures"
section and the "Purpose of the Exchange Offer" section and in Annex C
hereto in the "Plan of Distribution" section of the prospectus forming a
part of the Exchange Offer Registration Statement and include the
information set forth in Annex D hereto in the Letter of Transmittal
delivered pursuant to the Exchange Offer; (iii) if requested by the
Initial Purchaser, include the information required by Items 507 or 508 of
Regulation S-K under the Securities Act, as applicable, in the prospectus
forming a part of the Exchange Offer Registration Statement; (iv) include
within the prospectus contained in the Exchange Offer Registration
Statement a section entitled "Plan of Distribution," reasonably acceptable
to the Initial Purchaser, which shall contain a summary statement of the
positions taken or policies made by the staff of the Commission with
respect to the potential "underwriter" status of any broker-dealer that is
the beneficial owner (as defined in Rule 13d-3 under the Securities
Exchange Act of 1934, as amended (the "Exchange Act")) of Exchange Notes
received by such broker-dealer in the Exchange Offer (a "Participating
Broker-Dealer"), whether such positions or policies have been publicly
disseminated by the staff of the Commission or such positions or policies,
in the reasonable judgment of the Initial Purchaser based upon advice of
counsel (which may be in-house counsel), represent the prevailing views of
the staff of the Commission; and (v) in the case of a Shelf Registration
Statement, include the names of the Holders who propose to sell Securities
pursuant to the Shelf Registration Statement, as selling security holders.
(b) The Company shall give written notice to the Initial Purchaser,
the Holders of the Securities and any Participating Broker-Dealer from
whom the Company has received prior written notice that it will be a
Participating Broker-Dealer in the Exchange Offer (which notice pursuant
to clauses (ii) through (v) hereof shall be accompanied by an instruction
to suspend the use of the prospectus until the requisite changes have been
made):
(i) when the Registration Statement or any amendment thereto
has been filed with the Commission and when the Registration
Statement or any post-effective amendment thereto has become
effective;
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(ii) of any request by the Commission for amendments or
supplements to the Registration Statement or the prospectus included
therein or for additional information (provided that with respect to
any requests prior to the effectiveness of the Registration
Statement, the Company shall be required to give written notice only
to the initial Purchaser and its counsel, King & Spalding);
(iii) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or the
initiation of any proceedings for that purpose;
(iv) of the receipt by the Company or its legal counsel of any
notification with respect to the suspension of the qualification of
the Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; and
(v) of the happening of any event that requires the Company to
make changes in the Registration Statement or the prospectus in
order that the Registration Statement or the prospectus do not
contain an untrue statement of a material fact nor omit to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading.
(c) The Company shall use its best efforts to obtain the withdrawal
at the earliest possible time, of any order suspending the effectiveness
of the Registration Statement.
(d) The Company shall furnish to each Holder of Securities included
within the coverage of the Shelf Registration, without charge, at least
one copy of the Shelf Registration Statement and any post-effective
amendment thereto, including financial statements and schedules, and, if
the Holder so requests in writing, all exhibits thereto (including those,
if any, incorporated by reference).
(e) The Company shall deliver to each Exchanging Dealer and the
Initial Purchaser, and to any other Holder who so requests, without
charge, at least one copy of the Exchange Offer Registration Statement and
any post-effective amendment thereto, including financial statements and
schedules, and, if the Initial Purchaser or any such Holder requests in
writing, all exhibits thereto (including those incorporated by reference).
(f) The Company shall deliver to each Holder of Securities included
within the coverage of the Shelf Registration, without charge, as many
copies of the prospectus (including each preliminary prospectus) included
in the Shelf Registration Statement and any amendment or supplement
thereto as such person may reasonably request. The Company consents,
subject to the provisions of this Agreement, to the use of the prospectus
or any amendment or supplement thereto by each of the selling Holders of
the Securities in connection with the offering and sale of the Securities
covered by the
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prospectus, or any amendment or supplement thereto, included in the Shelf
Registration Statement.
(g) The Company shall deliver to the Initial Purchaser, any
Exchanging Dealer, any Participating Broker-Dealer and such other persons
required to deliver a prospectus following the Exchange Offer, without
charge, as many copies of the final prospectus included in the Exchange
Offer Registration Statement and any amendment or supplement thereto as
such persons may reasonably request. The Company consents, subject to the
provisions of this Agreement, to the use of the prospectus or any
amendment or supplement thereto by the Initial Purchaser, if necessary,
any Participating Broker-Dealer and such other persons required to deliver
a prospectus following the Exchange Offer in connection with the offering
and sale of the Exchange Notes covered by the prospectus, or any amendment
or supplement thereto, included in such Exchange Offer Registration
Statement.
(h) Prior to any public offering of the Securities, pursuant to any
Registration Statement, the Company shall register or qualify or cooperate
with the Holders of the Securities included therein and their respective
counsel in connection with the registration or qualification of the
Securities for offer and sale under the securities or "blue sky" laws of
such states of the United States as any Holder of the Securities
reasonably requests in writing and do such other acts or things reasonably
necessary or advisable to enable the offer and sale in such jurisdictions
of the Securities covered by such Registration Statement; provided,
however, that the Company shall not be required to (i) qualify generally
to do business in any jurisdiction where it is not then so qualified or
(ii) take any action which would subject it to general service of process
or to taxation in any jurisdiction where it is not then so subject.
(i) The Company shall cooperate with the Holders of the Securities
to facilitate the timely preparation and delivery of certificates
representing the Securities to be sold pursuant to any Registration
Statement free of any restrictive legends and in such denominations and
registered in such names as the Holders may request a reasonable period of
time prior to sales of the Securities pursuant to such Registration
Statement.
(j) Upon the occurrence of any event contemplated by paragraphs (ii)
or (v) of Section 3(b) above during the period for which the Company is
required to maintain an effective Registration Statement, the Company
shall promptly prepare and file a post-effective amendment to the
Registration Statement or a supplement to the related prospectus and any
other required document so that, as thereafter delivered to Holders of the
Senior Notes or purchasers of Securities, the prospectus will not contain
an 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.
If the Company notifies the Initial Purchaser, the Holders of the
Securities and any known Participating Broker-Dealer in accordance with
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paragraphs (ii) through (v) of Section 3(b) above to suspend the use of
the prospectus until the requisite changes to the prospectus have been
made or any stop order has been lifted, as the case may be, then the
Initial Purchaser, the Holders of the Securities and any such
Participating Broker-Dealers shall suspend use of such prospectus, and the
period of effectiveness of the Shelf Registration Statement provided for
in Section 2(b) above and the Exchange Offer Registration Statement
provided for in Section 1 above shall each be extended (i) by the number
of days from and including the date of the giving of such notice to and
including the date when the Initial Purchaser, the Holders of the
Securities and any known Participating Broker-Dealer shall have received
such amended or supplemented prospectus pursuant to this Section 3(j) or
(ii) if earlier, until the date when none of the Securities represent
Transfer Restricted Notes.
(k) Not later than the effective date of the applicable Registration
Statement, the Company will provide a CUSIP number for the Senior Notes,
the Exchange Notes or the Private Exchange Notes, as the case may be, and
provide the applicable trustee with printed certificates for the Senior
Notes, the Exchange Notes or the Private Exchange Notes, as the case may
be, in a form eligible for deposit with The Depository Trust Company.
(l) The Company will comply with all rules and regulations of the
Commission to the extent and so long as they are applicable to the
Exchange Offer or the Shelf Registration and will make generally available
to its security holders (or otherwise provide in accordance with Section
11(a) of the Securities Act) an earnings statement satisfying the
provisions of Section 11(a) of the Securities Act, no later than 45 days
after the end of a 12-month period (or 90 days, if such period is a fiscal
year) beginning with the first month of the Company's first fiscal quarter
commencing after the effective date of the Registration Statement, which
statement shall cover such 12-month period.
(m) The Company shall cause the Indenture to be qualified under the
Trust Indenture Act of 1939, as amended, in a timely manner and containing
such changes, if any, as shall be necessary for such qualification. In the
event that such qualification would require the appointment of a new
trustee under the Indenture, the Company shall appoint a new trustee
thereunder pursuant to the applicable provisions of the Indenture.
(n) The Company may require each Holder of Securities to be sold
pursuant to the Shelf Registration Statement to furnish to the Company
such information regarding the Holder and the distribution of the
Securities as the Company may from time to time reasonably require for
inclusion in the Shelf Registration Statement, and the Company may exclude
from such registration the Securities of any Holder that unreasonably
fails to furnish such information within a reasonable time after receiving
such request.
(o) The Company shall enter into such customary agreements
(including if requested an underwriting agreement in customary form) and
take all such other action,
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if any, as any Holder of the Securities shall reasonably request in order
to facilitate the disposition of the Securities pursuant to any Shelf
Registration.
(p) In the case of any Shelf Registration, the Company shall (i)
make available for inspection by the Holders of the Securities, any
underwriter participating in any disposition pursuant to the Shelf
Registration Statement and any attorney or accountant retained by the
Holders of the Securities or any such underwriter all relevant financial
and other records, pertinent corporate documents and properties of the
Company and (ii) cause the Company's officers, directors and employees,
and use its best efforts to cause the Company's accountants and auditors,
to supply all relevant information reasonably requested by the Holders of
the Securities or any such underwriter, attorney or accountant in
connection with the Shelf Registration Statement, in each case, as shall
be necessary, in the judgment of the Holder or any such underwriter,
attorney or accountant referred to in this paragraph, to conduct a
investigation within the meaning of Section 11 of the Securities Act;
provided, however, that the foregoing inspection and information gathering
shall be coordinated on behalf of yourself by you and on behalf of the
other parties, by one counsel designated by and on behalf of such other
parties as described in Section 4 hereof.
(q) In the case of any Shelf Registration, the Company, if requested
by any Holder of Securities covered thereby, shall cause (i) its counsel
to deliver an opinion and updates thereof relating to the Securities in
customary form (with customary carve-outs and qualifications) addressed to
such Holders and the managing underwriters, if any, thereof and dated, in
the case of the initial opinion, the effective date of such Shelf
Registration Statement (it being agreed that the matters to be covered by
such opinion shall include, without limitation, the due incorporation and
good standing of the Company and its subsidiaries; the due authorization,
execution and delivery of the relevant agreement of the type referred to
in Section 3(o) hereof; the due authorization, execution, authentication
and issuance, and the validity and enforceability, of the applicable
Securities; the absence of material legal or governmental proceedings
involving the Company; the absence of governmental approvals required to
be obtained in connection with the Shelf Registration Statement, the
offering and sale of the applicable Securities, or any agreement of the
type referred to in Section 3(o) hereof; the compliance as to form of such
Shelf Registration Statement and any documents incorporated by reference
therein and of the Indenture with the requirements of the Securities Act
and the Trust Indenture Act, respectively; and such opinion shall include
a statement of such counsel's belief that, as of the date of the opinion
and as of the effective date of the Shelf Registration Statement or most
recent post effective amendment thereto, as the case may be, such Shelf
Registration Statement and the prospectus included therein, as then
amended or supplemented, including any documents incorporated by reference
therein, did not and does not contain an untrue statement of a material
fact and did not and does not omit to state therein a material fact
required to be stated therein or necessary in order to make the statements
therein not misleading (in the case of any such incorporated documents, in
the light of the circumstances existing at the time that such documents
were filed with the
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Commission under the Exchange Act); (ii) its officers to execute and
deliver all customary documents and certificates and updates thereof
requested by any underwriters of the applicable Securities and (iii) its
independent public accountants to provide to the selling Holders of the
applicable Securities and any underwriter therefor a comfort letter in
customary form and covering matters of the type customarily covered in
comfort letters in connection with primary underwritten offerings, subject
to receipt of appropriate documentation as contemplated, and only if
permitted, by Statement of Auditing Standards No. 72.
(r) In the case of the Exchange Offer, if requested by the Initial
Purchaser or any known Participating Broker-Dealer, the Company shall
cause (i) its counsel to deliver to the Initial Purchaser or such
Participating Broker-Dealer signed opinions in the forms set forth in
Section 7(a) and 7(b) of the Purchase Agreement with such changes as are
customary in connection with the preparation of a Registration Statement
and (ii) its independent public accountants to deliver to the Initial
Purchaser or such Participating Broker-Dealer a comfort letter, in
customary form, meeting the requirements as to the substance thereof as
set forth in Section 7(d) of the Purchase Agreement, with appropriate date
changes, and only if permitted by Statement of Auditing Standards No. 72.
(s) If an Exchange Offer or a Private Exchange is to be consummated,
upon delivery of the Senior Notes by Holders to the Company (or to such
other Person as directed by the Company) in exchange for the Exchange
Notes or the Private Exchange Notes, as the case may be, the Company shall
xxxx, or caused to be marked, on the Senior Notes so exchanged that such
Senior Notes are being cancelled in exchange for the Exchange Notes or the
Private Exchange Notes, as the case may be; in no event shall the Senior
Notes be marked as paid or otherwise satisfied.
(t) The Company will use its best efforts to (i) if the Senior Notes
have been rated prior to the initial sale of such Senior Notes, confirm
that such ratings will apply to the Securities covered by a Registration
Statement or (ii) if the Senior Notes were not previously rated, cause the
Securities covered by a Registration Statement to be rated with the
appropriate rating agencies, if so requested by Holders of a majority in
aggregate principal amount of Securities covered by such Registration
Statement, or by the managing underwriters, if any.
(u) In the event that any broker-dealer registered under the
Exchange Act shall underwrite any Securities or participate as a member of
an underwriting syndicate or selling group or "assist in the distribution"
(within the meaning of the Rules of Fair Practice and the By-Laws of the
National Association of Securities Dealers, Inc. ("NASD")) thereof,
whether as a Holder of such Securities or as an underwriter, a placement
or sales agent or a broker or dealer in respect thereof, or otherwise, the
Company shall cooperate with and assist such broker-dealer in complying
with the requirements of such Rules and By-Laws.
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(v) The Company shall use its best efforts to take all other steps
necessary to effect the registration of the Securities covered by a
Registration Statement contemplated hereby.
4. Registration Expenses. (a) All fees and expenses incident to the
Company's performance of or compliance with this Agreement will be borne by the
Company regardless of whether a Registration Statement becomes effective,
including without limitation: (i) all registration and filing fees and expenses
(including filings made with the NASD (and, if applicable, the reasonable fees
and expenses of any "qualified independent underwriter" and its counsel that may
be required by the rules and regulations of the NASD)); (ii) all fees and
expenses of compliance with federal securities and state Blue Sky or securities
laws; (iii) all expenses of printing (including printing certificates for the
Exchange Notes to be issued in the Exchange Offer and printing of prospectuses);
(iv) all fees and disbursements of counsel for the Company, the Subsidiary
Guarantors and, subject to Section 7(b) below, the Holders of Transfer
Restricted Securities; (v) all application and filing fees in connection with
listing the Notes on a national securities exchange or automated quotation
system pursuant to the requirements of this Agreement; and (vi) all fees and
disbursements of independent accountants of the Company (including the expenses
of any special audit and comfort letters required by or incident to such
performance).
The Company will, in any event, bear its internal expenses (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expenses of any annual audit and the
fees and expenses of any Person, including special experts, retained by it.
Notwithstanding the foregoing or anything in this Agreement to the
contrary, each Holder shall pay all underwriting discounts and commissions of
any underwriters with respect to any Securities sold by or on behalf of it.
(b) In connection with any Registration Statement required by this
Agreement (including, without limitation, the Exchange Offer Registration
Statement and the Shelf Registration Statement), the Company will reimburse the
Initial Purchaser and the Holders of Securities being tendered in the Exchange
Offer and/or resold pursuant to the Shelf Registration Statement, as applicable,
for the reasonable fees and disbursements of not more than one counsel.
5. Indemnification. (a) The Company and each Subsidiary Guarantor agrees
to indemnify and hold harmless (i) the Initial Purchaser, each Holder of the
Securities and any Participating Broker-Dealer, and (ii) each person, if any,
who controls the Initial Purchaser, such Holder or such Participating
Broker-Dealer within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act (any of the persons referred to in this clause (ii) being
hereinafter referred to as a "controlling person") and (iii) the agents,
employees, officers and directors of any Person referred to in clause (i) or
(ii) who, collectively with the Persons referred to in clauses (i) and (ii) are
referred to collectively as the "Indemnified Parties," from and against
-12-
any and all losses, liabilities, claims, damages or expenses whatsoever
(including but not limited to attorneys' fees and any and all expenses incurred
in investigating, preparing or defending against any litigation, commenced or
threatened, or any claim whatsoever, and any and all amounts paid in settlement
of any claim or litigation), joint or several, or any actions in respect thereof
(including, but not limited to, any losses, claims, damages, liabilities or
actions relating to purchases and sales of the Securities) to which any
Indemnified Party may become subject under the Securities Act, the Exchange Act
or otherwise, insofar as such losses, liabilities, claims, damages, expenses (or
actions in respect thereof) arise out of or are based upon any untrue statement
or alleged untrue statement of a material fact contained in a Registration
Statement or prospectus included therein or in any amendment thereof or
supplement thereto, or arise out of, or are based upon, the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading; provided, however, that
the Company and the Subsidiary Guarantors shall not be liable in any such case
to the extent, but only to the extent, that such loss, liability, claim, damage,
or expense arises out of or is based upon any untrue statement or alleged untrue
statement or omission or alleged omission made in a Registration Statement or
prospectus included therein or in any amendment thereof or supplement thereto or
in any preliminary prospectus relating to a Shelf Registration in reliance upon
and in conformity with written information pertaining to such Indemnified Party
and furnished to the Company or a Subsidiary Guarantor by or on behalf of such
Indemnified Party expressly for use therein; provided, further, that neither the
Company nor any Subsidiary Guarantor shall be liable pursuant to this subsection
(a) with respect to any preliminary prospectus to the extent that any loss,
expense, liability or claim arises solely from the fact that the Indemnified
Party or related Holder fails to send or deliver, on or prior to the written
confirmation of the sale by such Indemnified Party or related Holder a final
prospectus; provided that the Company shall have previously furnished copies
thereof to the Indemnified Party or such related Holder and such final
prospectus would have corrected any such untrue statement or omission; provided
further, that this indemnity agreement will be in addition to any liability
which the Company or any Subsidiary Guarantor may otherwise have to such
Indemnified Party. The Company shall also indemnify underwriters participating
in the distribution (as described in the Registration Statement), their officers
and directors and each person who controls such persons within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act to the same
extent as provided above with respect to the indemnification of the Holders of
the Securities if requested by such Holders.
(b) In connection with any Registration Statement pursuant to which a
Holder offers or sells Securities, such Holder agrees, severally and not
jointly, to indemnify and hold harmless the Company and the Subsidiary
Guarantors, their respective directors and officers and any person controlling
the Company or a Subsidiary Guarantor 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 respect to information relating to such Holder
furnished in writing by or on behalf of such Holder expressly for use in such
Registration Statement or prospectus included therein or in any amendment
thereof or supplement thereto. In any such case in which any action shall be
brought
-13-
against the Company or a Subsidiary Guarantor, any director or officer of the
Company or a Subsidiary Guarantor or any person controlling the Company or a
Subsidiary Guarantor based on such Registration Statement and in respect of
which indemnity may be sought against a Holder, such Holder shall have the
rights and duties given to the Company and the Subsidiary Guarantors (except
that if the Company or a Subsidiary Guarantor shall have assumed the defense
thereof, such Holder shall not be required to do so, but may employ separate
counsel therein and participate in the defense thereof but the fees and expenses
of such counsel shall be at the expense of such Holder), and the Company and the
Subsidiary Guarantors, their respective directors and officers and any person
controlling the Company or a Subsidiary Guarantor shall have the rights and
duties given to the Indemnified Parties by Section 5(a) hereof. This indemnity
agreement will be in addition to any liability which such Holder may otherwise
have to the Company or any of its controlling persons.
(c) Promptly after receipt by an Indemnified Party under this Section 5 of
notice of the commencement of any action or proceeding (including a governmental
investigation) (collectively an "Action"), such Indemnified Party shall, if a
claim in respect thereof is to be made against the Indemnifying Party under this
Section 5, promptly notify each party against whom indemnification is to be
sought in writing of the commencement of such Action (but the failure so to
notify the Indemnifying Party shall not, in any event, relieve the Indemnifying
Party of liability that it may have under this Section 5, except to the extent
that it has been prejudiced in any material respect by such failure, or from any
liability which it may otherwise have). In case any such Action is brought
against any Indemnified Party, and it notifies the Indemnifying Party of the
commencement thereof, the Indemnifying Party will be entitled to participate in
such Action and, to the extent that it may elect by written notice delivered to
the Indemnified Party promptly after receiving the aforesaid notice from such
Indemnified Party, to assume the defense of such Action, with counsel reasonably
satisfactory to such Indemnified Party (which counsel shall not, except with the
consent of the Indemnified Party (which consent shall not be unreasonably
withheld), be counsel to the Indemnifying Party. Notwithstanding the foregoing,
the Indemnified Party or parties shall have the right to employ its or their own
counsel in any such Action, but the fees and expenses of such counsel shall be
at the expense of such Indemnified Party or Parties unless (i) the employment of
such counsel shall have been authorized in writing by the Indemnifying Parties
in connection with the defense of such Action, (ii) the Indemnifying Parties
shall not have employed counsel to take charge of the defense of such Action
within a reasonable time after notice of commencement of the Action, or (iii)
such Indemnified Party or Parties shall have reasonably concluded that there may
be defenses available to it or them that are different from or additional to
those available to one or all of the Indemnifying Parties (in which case the
Indemnifying Parties shall not have the right to direct the defense of such
Action on behalf of the Indemnified Party or Parties), in any of which events
such fees and expenses of counsel shall be borne by the Indemnifying Parties. In
no event shall the Indemnifying Party be liable for the fees and expenses of
more than one counsel (together with appropriate local counsel) at any time for
all Indemnified Parties in connection with any one Action or separate but
substantially similar or related actions in the same jurisdiction arising out of
the same general allegations or circumstances. Anything in this subsection to
the contrary notwithstanding, an Indemnifying Party shall not be liable for
-14-
any settlement of any claim or Action effected without its written consent;
provided, however, that such consent was not unreasonably withheld.
(d) In order to provide for contribution in circumstances in which the
indemnification provided for in paragraphs (a) and (b) of this Section 5 is
applicable for any reason held to be unavailable from the indemnifying party, or
is insufficient to hold harmless a party indemnified under this Section 5, the
Company, the Subsidiary Guarantors and the Indemnified Parties shall contribute
to the aggregate losses, claims, damages, liabilities and expenses of the nature
contemplated by such indemnification provision (including any reasonable
investigation, legal and other expenses incurred in connection with, and any
amount paid in settlement of, any Action or any claims asserted, but after
deducting in the case of losses, claims, damages, liabilities and expenses
suffered by the indemnifying party, any contribution received by the
indemnifying party, from persons other than the Indemnified Party who may also
be liable for contribution, including persons who control the Indemnified Party
within the meaning of Section 15 of the Act or Section 20(a) of the Exchange
Act) to which the Company, the Subsidiary Guarantors and the Indemnified Parties
may be subject, in such proportion as is appropriate to reflect the relative
benefits received by the Company and the Subsidiary Guarantors, on the one hand,
and the Indemnified Parties, on the other hand, from the offering of the Senior
Notes or, if such allocation is not permitted by applicable law or
indemnification is not permitted by applicable law or indemnification is not
available as a result of the indemnifying party not having received notice as
provided in paragraph (c) of this Section 5, in such proportion as is
appropriate to reflect not only the relative benefits referred to above but also
the relative fault of the Company and the Subsidiary Guarantors, on the one
hand, and the Indemnified Parties, on the other hand, in connection with the
statements or omissions that resulted in such losses, claims, damages,
liabilities or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company and the Subsidiary Guarantors
shall be deemed to be in the same proportion as the total proceeds from the
offering of Senior Notes (net of discounts but before deducting expenses)
received by the Company as set forth in the table on the cover page of the
Prospectus. The relative fault of the Company and the Subsidiary Guarantors, on
the one hand, and the Indemnified 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 the Company, the Subsidiary
Guarantors or the Indemnified Parties and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
(e) The agreements contained in this Section 5 shall survive the sale of
the Securities pursuant to a Registration Statement and shall remain in full
force and effect, regardless of any termination or cancellation of this
Agreement or any investigation made by or on behalf of any indemnified party.
6. Liquidated Damages Under Certain Circumstances. (a) Liquidated damages
("Liquidated Damages") with respect to the Securities shall be assessed as
follows if any of the
-15-
following events occur (each such event in clauses (i) through (iii) below a
"Registration Default"):
(i) If by the 90th day (or if such 90th day is not a business day,
the first business day thereafter) after the Issue Date, neither the
Exchange Offer Registration Statement nor a Shelf Registration Statement
has been filed with the Commission;
(ii) If by the 180th day (or if such 180th day is not a business
day, the first business day thereafter) after the Issue Date, neither the
Exchange Offer is consummated nor, if required in lieu thereof, the Shelf
Registration Statement is declared effective by the Commission; or
(iii) If after either the Exchange Offer Registration Statement or
the Shelf Registration Statement is declared effective, (A) such
Registration Statement thereafter ceases to be effective prior to
completion of the Exchange Offer or the sale of all of the Transfer
Restricted Notes registered pursuant to the Shelf Registration Statement,
as the case may be; or (B) such Registration Statement or the related
prospectus ceases to be usable (except as permitted in paragraph (b) of
this Section 6) in connection with resales of Transfer Restricted Notes
during the periods specified herein because either (1) any event occurs as
a result of which the related prospectus forming part of such Registration
Statement would include any untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading, or
(2) it shall be necessary to amend such Registration Statement or
supplement the related prospectus, to comply with the Securities Act or
the Exchange Act or the respective rules thereunder.
The Company will pay Liquidated Damages to each Holder of Transfer Restricted
Securities, during the first 90-day period immediately following the occurrence
of a Registration Default in amount equal to $.05 per week per $1,000 principal
amount of Senior Notes constituting Transfer Restricted Securities held by such
Holder. The amount of Liquidated Damages will increase an additional $.05 per
week per $1,000 principal amount of Senior Notes constituting Transfer
Restricted Securities for each subsequent 90-day period until the applicable
Registration Default has been cured, up to a maximum amount of Liquidated
Damages of $.30 per week per $1,000 principal amount of Senior Notes
constituting Transfer Restricted Securities. All accrued Liquidated Damages will
be paid by the Company on the regular interest payment dates with respect to the
Senior Notes to the Global Note Holders by wire transfer of immediately
available funds or by federal funds check to the Holders of certified securities
by mailing a check to such Holders' registered addresses. Following the cure of
all Registration Defaults, the accrual of Liquidated Damages shall cease.
(b) A Registration Default referred to in Section 6(a)(iii)(B) shall be
deemed not to have occurred and be continuing in relation to a Shelf
Registration Statement or the related prospectus if (i) such Registration
Default has occurred solely as a result of (x) the filing of a post-effective
amendment to such Shelf Registration Statement to incorporate annual audited or,
-16-
if required by the rules and regulations under the Securities Act, quarterly
unaudited, financial information with respect to the Company where such
post-effective amendment is not yet effective and needs to be declared effective
to permit Holders to use the related prospectus or (y) other material events or
developments with respect to the Company that would need to be described in such
Shelf Registration Statement or the related prospectus and (ii) in the case of
clause (y), the Company is proceeding promptly and in good faith to amend or
supplement such Shelf Registration Statement and related prospectus to describe
such events or, in the case of material developments that the Company determines
in good faith must remain confidential for business reasons, the Company is
proceeding promptly and in good faith to take such steps as are necessary so
that such developments need no longer remain confidential.
(c) "Transfer Restricted Notes" means each Security until (i) the date on
which such Security has been exchanged by a person other than a broker-dealer
for a freely transferrable Exchange Note in the Exchange Offer, (ii) following
the exchange by a broker-dealer in the Exchange Offer of a Security for an
Exchange Note, the date on which such Exchange Note is sold to a purchaser who
receives from such broker-dealer on or prior to the date of such sale a copy of
the prospectus contained in the Exchange Offer Registration Statement, (iii) the
date on which such Security has been effectively registered under the Securities
Act and disposed of in accordance with the Shelf Registration Statement or (iv)
the date on which such Security is distributed to the public pursuant to Rule
144 under the Securities Act or is saleable pursuant to Rule 144(k) under the
Securities Act.
7. Rules 144 and 144A. The Company shall use its best efforts to file the
reports required to be filed by it under the Securities Act and the Exchange Act
in a timely manner and, if at any time the Company is not required to file such
reports, it will, upon the request of any Holder of Transfer Restricted Notes,
make publicly available other information so long as necessary to permit sales
of their securities pursuant to Rules 144 and 144A. The Company covenants that
it will take such further action as any Holder of Transfer Restricted Notes may
reasonably request, all to the extent required from time to time to enable such
Holder to sell Transfer Restricted Notes without registration under the
Securities Act within the limitation of the exemptions provided by Rules 144 and
144A (including the requirements of Rule 144A(d)(4)). The Company will provide a
copy of this Agreement to prospective purchasers of Senior Notes identified to
the Company by the Initial Purchaser upon request. Upon the request of any
Holder of Transfer Restricted Notes, the Company shall deliver to such Holder a
written statement as to whether it has complied with such requirements.
Notwithstanding the foregoing, nothing in this Section 7 shall be deemed to
require the Company to register any of its securities pursuant to the Exchange
Act.
8. Underwritten Registrations. If any of the Transfer Restricted Notes
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
administer the offering ("Managing Underwriters") will be selected by the
Holders of a majority in aggregate principal amount of such Transfer Restricted
Notes to be included in such offering (subject to the approval (which approval
shall not
-17-
be unreasonably withheld) of the Company, provided that the Company shall not be
obligated to arrange for more than one underwritten offering during the period
that such Shelf Registration is required to be effective pursuant to this
Agreement.
No person may participate in any underwritten registration hereunder
unless such person (i) agrees to sell such person's Transfer Restricted Notes on
the basis reasonably provided in any underwriting arrangements approved by the
persons entitled hereunder to approve such arrangements and (ii) completes and
executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents reasonably required under the terms of such
underwriting arrangements.
9. Miscellaneous.
(a) Amendments and Waivers. The provisions of this Agreement may not be
amended, modified or supplemented, and waivers or consents to departures from
the provisions hereof may not be given, except by the Company and the written
consent of the Holders of a majority in principal amount of the Securities
affected by such amendment, modification, supplement, waiver or consents.
(b) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand delivery, first-class mail,
facsimile transmission, or air courier which guarantees overnight delivery:
(i) if to a Holder of the Securities, at the most current address
given by such Holder to the Company in accordance with the provisions of
this Section 9(b), which address initially is, with respect to each
Holder, the address of such Holder to which confirmation of the sale of
the Senior Notes to such Holder was first sent by the Initial Purchaser,
with a copy in like manner to you as follows:
Xxxxxx, Read & Co. Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax No.: 000-000-0000
Attention:Corporate Finance Department
with a copy to:
King & Spalding
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax No.: 000.000.0000
Attention:Xxxx X. Xxxxxxx
-18-
(ii) if to the Initial Purchaser, at the addresses specified in
Section 9(b)(i);
(iii) if to the Company, at its address as follows:
Xxxxxxx & Xxxxx, Inc.
000 Xxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxxxx 00000
Fax No: 000.000.0000
Attention:Chief Financial Officer
with a copy to:
Xxxxxx Xxxxxxx & Xxxx LLP
0 Xxxxxxx Xxxx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax No: 000.000.0000
Attention:Xxxx Xxxxx
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; three business
days after being deposited in the mail, postage prepaid, if mailed; when receipt
is acknowledged by the recipient's facsimile machine operator, if sent by
facsimile transmission; and on the day delivered, if sent by overnight air
courier guaranteeing next day delivery.
(c) No Inconsistent Agreements. The Company has not, as of the date
hereof, entered into, nor shall it, on or after the date hereof, enter into, any
agreement with respect to its securities that is inconsistent with the rights
granted to the Holders herein or otherwise conflicts with the provisions hereof.
(d) Successors and Assigns. This Agreement shall be binding upon the
Company and its successors and assigns.
(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 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 WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OF LAWS.
-19-
(h) Severability. If 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.
(i) Securities Held by the Company. Whenever the consent or approval of
Holders of a specified percentage of principal amount of Securities is required
hereunder, Securities held by the Company or its affiliates (other than
subsequent Holders of Securities if such subsequent Holders are deemed to be
affiliates solely by reason of their holdings of such Securities) shall not be
counted in determining whether such consent or approval was given by the Holders
of such required percentage.
(j) Remedies. Each Holder, in addition to being entitled to exercise all
rights provided in this Agreement, in the Indenture, the Purchase Agreement or
granted by law, including recovery of liquidated or other damages, will be
entitled to specific performance of its rights under this Agreement. The Company
and the Subsidiary Guarantors agree that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach by it of the provisions
of this Agreement and hereby agree to waive the defense in any Action for
specific performance that a remedy at law would be adequate.
(k) Adjustments Affecting the Notes. Without the written consent of the
Holders of a majority in aggregate principal amount of outstanding Senior Notes,
the Company and the Subsidiary Guarantors will not take any action, or permit
any change to occur, with respect to the Senior Notes that would materially and
adversely affect the ability of the Holders to consummate any Exchange Offer.
-20-
The foregoing Registration Rights
Agreement is hereby confirmed and
accepted as of the date first above written.
XXXXXX, READ & CO. INC.
By: /s/ Xxxxxxx Xx
-------------------------------
Title: Vice President
Name: Xxxxxxx Xx
ANNEX A
Each broker-dealer that receives Exchange Notes for its own account pursuant
to the Exchange Offer must acknowledge that it will deliver a prospectus in
connection with any resale of such Exchange Notes. The Letter of Transmittal
states that by so acknowledging and by delivering a prospectus, a broker-dealer
will not be deemed to admit that it is an "underwriter" within the meaning of
the Securities Act. This Prospectus, as it may be amended or supplemented from
time to time, may be used by a broker-dealer in connection with resales of
Exchange Notes received in exchange for Senior Notes where such Senior Notes
were acquired by such broker-dealer as a result of market-making activities or
other trading activities. The Company has agreed that, for a period of 180 days
after the Expiration Date (as defined herein), it will make this Prospectus
available to any broker-dealer for use in connection with any such resale. See
"Plan of Distribution".
ANNEX B
Each broker-dealer that receives Exchange Notes for its own account in
exchange for Senior Notes, where such Senior Notes were acquired by such
broker-dealer as a result of market making activities or other trading
activities, must acknowledge that it will deliver a prospectus in connection
with any resale of such Exchange Notes. See "Plan of Distribution".
ANNEX C
PLAN OF DISTRIBUTION
Each broker-dealer that receives Exchange Notes for its own account pursuant
to the Exchange Offer must acknowledge that it will deliver a prospectus in
connection with any resale of such Exchange Notes. This Prospectus, as it may be
amended or supplemented from time to time, may be used by a broker-dealer in
connection with resales of Exchange Notes received in exchange for Existing
Notes where such Existing Notes were acquired as a result of market making
activities or other trading activities. The Company has agreed that, for a
period of 180 days after the Expiration Date, it will make this prospectus, as
it may be amended or supplemented from time to time, available to any
broker-dealer for use in connection with any such resale. In addition, until
_____________, 199_, all dealers effecting transactions in the Exchange Notes
may be required to deliver a prospectus.*
The Company will not receive any proceeds from any sale of Exchange Notes by
broker-dealers. Exchange Notes received by broker-dealers for their own account
pursuant to the Exchange Offer may be sold from time to time in one or more
transactions in the over-the-counter market, in negotiated transactions, through
the writing of options on the Exchange Notes or a combination of such methods of
resale, at market prices prevailing at the time of resale, at prices related to
such prevailing market prices or negotiated prices. Any such resale may be made
directly to purchasers or to or through brokers or dealers who may receive
compensation in the form of commissions or concessions from any such
broker-dealer or the purchasers of any such Exchange Notes. Any broker-dealer
that resells Exchange Notes that were received by it for its own account
pursuant to the Exchange Offer and any broker or dealer that participates in a
distribution of such Exchange Notes may be deemed to be an "underwriter" within
the meaning of the Securities Act and any profit on any such resale of Exchange
Notes and any commission or concessions received by any such persons may be
deemed to be underwriting compensation under the Securities Act. The Letter of
Transmittal states that, by acknowledging that it will deliver and by delivering
a prospectus, a broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.
For a period of 180 days after the Expiration Date the Company will
promptly send additional copies of this Prospectus and any amendment or
supplement to this Prospectus to any broker-dealer that requests such documents
in the Letter of Transmittal. The Company has agreed to pay all expenses
incident to the Exchange Offer (including the expenses of one counsel for the
Holders of the Senior Notes) other than commissions or concessions of any
brokers or dealers and will indemnify the Holders of the Securities (including
any broker-dealers) against certain liabilities including liabilities under the
Securities Act.
----------
* In addition, the legend required by Item 502(e) of Regulation S-K
will appear on the back cover page of the Exchange Offer prospectus.
ANNEX D
|_| CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10
ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY
AMENDMENTS OR SUPPLEMENTS THERETO.
Name: ____________________________________________________________
Address:__________________________________________________________
__________________________________________________________
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
Notes. If the undersigned is a broker-dealer that will receive Exchange Notes
for its own account in exchange for Senior Notes that were acquired as a result
of market-making activities or other trading activities, it acknowledges that it
will deliver a prospectus in connection with any resale of such Exchange Notes;
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.
Schedule I
to the
Registration Rights Agreement
1. WG Apparel, Inc.
2. Clinton Machinery Corporation
3. Clinton Management Corp.
4. Leadtec Systems, Inc.
5. W&G Daon, Inc.
6. J&E Sewing Supplies, Inc.
7. W&G Tennessee Imports, Inc.
8. Clinton Leasing Corp.
9. Clinton Equipment Corp.
10. Paradise Color Corp.
