EXHIBIT VI TO THE
CREDIT AGREEMENT
REGISTRATION RIGHTS AGREEMENT
Dated as of [ ], [ ]
by and among
REPUBLIC ENGINEERED STEELS, INC.
and
THE GUARANTORS
named herein
and
THE HOLDERS
named herein
------------------------------
$[208,460,000]
SENIOR SECURED NOTES DUE 2008
TABLE OF CONTENTS
Page
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1. Definitions......................................................2
2. Exchange Offer Registration......................................5
3. Shelf Registration...............................................6
4. Liquidated Damages...............................................7
5. Underwritten Registrations.......................................8
6. Registration Procedures..........................................8
7. Registration Expenses...........................................14
8. Indemnification.................................................14
9. Rule 144 and 144A...............................................17
10. Miscellaneous...................................................17
(a) No Inconsistent Agreements.............................17
(b) Adjustments Affecting Registrable Securities...........17
(c) Amendments and Waivers.................................17
(d) Notices................................................18
(e) Successors and Assigns.................................19
(f) Counterparts...........................................19
(g) Headings...............................................19
(h) Governing Law..........................................19
(i) Severability...........................................19
(j) Joint and Several Obligations..........................19
(k) Securities Held by the Issuers or Their Affiliates.....19
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REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is made and entered
into as of [ ], [ ], by and among Republic Engineered Steels, Inc., a Delaware
corporation (the "Company"), [list each domestic subsidiary of the Company] (the
"Guarantors") and the Holders (as defined below) whose signatures appear on the
execution pages of this Agreement (collectively with any other Holders who
become parties to this Agreement, the "Holders"). The Company and the Guarantors
are hereinafter collectively referred to as the "Issuers".
This Agreement is entered into in connection with the Credit Agreement (as
defined below) among the Company, the Guarantors named therein, the Lenders
named therein and The Chase Manhattan Bank, DLJ Bridge Finance, Inc. and
BankBoston, N.A., as Agents providing for the making of the loans thereunder in
connection with the transactions contemplated thereby. Pursuant to the terms of
the Credit Agreement, the Lenders may require the Issuers to exchange the loans
made thereunder for long-term notes (the "Notes") as described in the Credit
Agreement. In order to induce the Lenders to enter into the Credit Agreement,
the Issuers have agreed to provide the registration rights set forth in this
Agreement for the benefit of the Holders and their direct and indirect
transferees and assigns.
The parties hereby agree as follows:
1. Definitions
As used in this Agreement, the following terms shall have the following
meanings:
Advice: See the last paragraph of Section 6.
Agreement: See the first introductory paragraph to this Agreement.
Business Day: Any day excluding Saturday, Sunday and any day which is a
legal holiday under the laws of New York, New York or is a day on which banking
institutions therein located are authorized or required by law or other
governmental action to close.
Company: See the first introductory paragraph to this Agreement.
Conversion Date: As defined in the Credit Agreement.
Credit Agreement: The Credit Agreement, dated as of November 6, 1998, by
and among the Company, the Guarantors named therein, the Lenders named therein
and The Chase Manhattan Bank, DLJ Bridge Finance, Inc. and BankBoston, N.A., as
agents.
DTC: See Section 6(i).
Event Date: See Section 4(c).
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Exchange Effectiveness Date: 150 days after the Conversion Date.
Exchange Effectiveness Period: See Section 2.
Exchange Filing Date: 60 days after the Conversion Date.
Exchange Offer Registration: See Section 2.
Exchange Offer Consummation Date: 180 days after the Conversion Date.
Exchange Notes: See Section 3.
Exchange Registration Statement: See Section 2.
Guarantors: See the first introductory paragraph to this Agreement.
Holders: See the first introductory paragraph to this Agreement.
Indemnified Person: See Section 8(c).
Indemnifying Person: See Section 8(c).
Indenture: The Indenture to be entered into by and among the Company, the
Guarantors and an indenture trustee, pursuant to which the Notes will be issued,
as amended or supplemented from time to time in accordance with the terms
thereof.
Inspectors: See Section 6(p).
Issuers: See the first introductory paragraph to this Agreement.
Liquidated Damages: See Section 4(a).
Losses: See Section 8.
NASD: See Section 6(n).
Notes: The $[208,460,000] aggregate principal amount of notes of the
Company being issued pursuant to the Indenture as required by the Credit
Agreement.
Participant: See Section 8(a).
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 terms of the offering of any portion
of the Registrable Securi-
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ties covered by such Registration Statement, and all other amendments and
supplements to the Prospectus, including post-effective amendments, and all
material incorporated by reference or deemed to be incorporated by reference in
such Prospectus.
Registration Expenses: See Section 8(a).
Registrable Securities: The Notes upon original issuance thereof and at all
times subsequent thereto, until in the case of any such Note (i) a Registration
Statement covering such Note has been declared effective and such Note has been
disposed of in accordance with such effective Registration Statement, (ii) it is
sold in compliance with Rule 144 or may be sold pursuant to Rule 144(k), (iii)
it shall have been otherwise transferred and a new certificate for any such Note
not bearing a legend restricting further transfer shall have been delivered by
the Company, or (iv) it ceases to be outstanding.
Registration Statement: Any registration statement of the Issuers filed or
required to be filed with the SEC 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 under the Securities Act, as such Rule may be amended
from time to time, or any similar rule (other than Rule 144A) or regulation
hereafter adopted by the SEC.
Rule 144A: Rule 144A under the Securities Act, as such Rule may be amended
from time to time, or any similar rule (other than Rule 144) or regulation
hereafter adopted by the SEC.
Rule 415: Rule 415 under 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.
Shelf Effectiveness Date: 120 days after the Shelf Filing Date.
Shelf Filing Date: 60 days after the obligation to file a Shelf
Registration Statement arises.
Shelf Notice: See Section 3(a).
Shelf Registration: See Section 3(b).
Shelf Termination Date: See Section 3(b).
Subsequent Shelf Registration: See Section 3(c).
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TIA: The Trust Indenture Act of 1939, as amended.
Trustee: The trustee under the Indenture.
underwritten registration or underwritten offering: A registration in which
securities of any of the Issuers are sold to an underwriter for reoffering to
the public.
Withdrawal Election: See Section 4(b).
2. Exchange Offer Registration
The Issuers shall file with the SEC no later than the Exchange Filing Date,
an offer to exchange (the "Exchange Offer Registration") for any and all of the
Registrable Securities covered by such Exchange Offer Registration a like
aggregate principal amount of debt securities of the Company, guaranteed by the
Guarantors, which are identical in all material respects to the Notes (the
"Exchange Notes") (and which are entitled to the benefits of the Indenture or a
trust indenture which is identical in all material respects 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), except that the Exchange Notes shall have been
registered pursuant to an effective Registration Statement under the Securities
Act and shall contain no restrictive legend thereon. The Exchange Offer
Registration shall be registered under the Securities Act on the appropriate
form (the "Exchange Registration Statement") and shall comply with all
applicable tender offer rules and regulations under the Exchange Act.
Each of the Issuers agrees to use its reasonable best efforts to (x) cause
the Exchange Registration Statement to be declared effective under the
Securities Act on or before the Exchange Effectiveness Date; (y) keep the
Exchange Offer Registration open for at least 20 business days (or longer if
required by applicable law) after the date that notice of the Exchange Offer
Registration is mailed to Holders of Registrable Securities (the "Exchange
Effectiveness Period"); and (z) consummate the Exchange Offer Registration on or
prior to the Exchange Offer Consummation Date. If after such Exchange
Registration Statement is initially declared effective by the SEC, the Exchange
Offer Registration or the issuance of the Exchange Notes thereunder is
interfered with by any stop order, injunction or other order or requirement of
the SEC or any other governmental agency or court, such Exchange Registration
Statement shall be deemed not to have become effective for purposes of this
Agreement. Each Holder of Registrable Securities who participates in the
Exchange Offer Registration will be required to represent in writing that any
Exchange 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
Registration such Holder of Registrable Securities will have no arrangement or
understanding with any Person to participate in the distribution of the Exchange
Notes, and that such Holder of Registrable Securities is not an affiliate of any
of the Issuers within the meaning of the Securities Act.
In connection with the Exchange Offer Registration, the Issuers shall:
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(1) mail to each Holder a copy of the Prospectus forming part of the
Exchange Registration Statement, together with an appropriate letter of
transmittal and related documents;
(2) utilize the services of a depositary for the Exchange Offer
Registration with an address in the Borough of Manhattan, The City of New York;
(3) permit Holders of Notes to withdraw tendered Notes at any time prior to
the close of business, New York time, on the last Business Day on which the
Exchange Offer Registration shall remain open; and
(4) otherwise comply in all material respects with all applicable laws.
As soon as practicable after the close of the Exchange Offer Registration,
the Issuers shall:
(1) accept for exchange all Notes tendered and not validly withdrawn
pursuant to the Exchange Offer Registration;
(2) deliver to the Trustee for cancellation all Notes so accepted for
exchange; and
(3) cause the Trustee to authenticate and deliver promptly to each holder
of Notes, Exchange Notes, equal in principal amount to the Notes of such holder
so accepted for exchange.
The Exchange Notes may be issued under (i) the Indenture or (ii) an
indenture identical in all material respects to the Indenture, which in either
event will provide that the holders of the Notes and the Exchange Notes will
vote and consent together on all matters as one class and that neither the
Exchange Notes nor the Notes will have the right to vote or consent as a
separate class on any matter.
3. Shelf Registration
(a) Shelf Registration. If (i) because of any change in law or applicable
interpretations thereof by the Commission's staff, the Company is not permitted
to effect the Exchange Offer Registration as contemplated by Section 2 hereof,
or (ii) any Registrable Securities validly tendered pursuant to the Exchange
Offer Registration are not exchanged for Exchange Notes by the Exchange Offer
Consummation Date, or (iii) any applicable law or interpretations do not permit
any Holder to participate in the Exchange Offer Registration, or (iv) any Holder
that participates in the Exchange Offer Registration does not receive freely
transferable Exchange Notes in exchange for tendered Registrable Securities, the
Issuers agree to file with the SEC, a Registration Statement for an offering to
be made on a continuous basis pursuant to Rule 415 covering all of the
Registrable Securities (the "Shelf Registration"). The Shelf Registration shall
be on Form S-1 or another appropriate form permitting registration of such
Registrable Securities for resale by Holders in the manner or manners designated
by them (including, without limitation, one or more underwritten offerings). The
Issuers shall not permit any securities other than the Registrable Securities to
be included in the Shelf
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Registration or any Subsequent Shelf Registration. The Issuers shall use their
reasonable best efforts to cause the Shelf Registration to be declared effective
under the Securities Act on or prior to the Shelf Effectiveness Date and to keep
such Shelf Registration continuously effective under the Securities Act until
the date which is two years from the Conversion Date (subject to extension
pursuant to the last paragraph of Section 6 and pursuant to Section 10) (the
"Shelf Termination Date"), or such shorter period ending when all Registrable
Securities covered by such Shelf Registration have been sold in the manner set
forth and as contemplated in such Shelf Registration.
(b) Subsequent Shelf Registrations. If a Shelf Registration or any
Subsequent Shelf Registration ceases to be effective for any reason at any time
prior to the Shelf Termination Date (other than because of the sale of all
Registrable Securities covered by such Shelf Registration in the manner set
forth and as contemplated in such Shelf Registration) the Issuers shall use
their reasonable best efforts to obtain the prompt withdrawal of any order
suspending the effectiveness thereof, and in any event shall within 45 days of
such cessation of effectiveness amend such Shelf Registration in a manner
reasonably expected to obtain the withdrawal of the order suspending the
effectiveness thereof, or file an additional "shelf" Registration Statement
pursuant to Rule 415 covering all of the Registrable Securities which were
covered by such Shelf Registration that have not been sold in the manner set
forth and as contemplated in such Shelf Registration (a "Subsequent Shelf
Registration"). If a Subsequent Shelf Registration is filed, the Issuers shall
use their reasonable best efforts to cause such Subsequent Shelf Registration to
be declared effective as soon as practicable after such filing and to keep such
Registration Statement continuously effective until the Shelf Termination Date.
As used herein the term "Shelf Registration" means the Shelf Registrations and
any Subsequent Shelf Registrations.
(c) Supplements and Amendments. The Issuers shall promptly supplement and
amend a Shelf Registration if required by the rules, regulations or instructions
applicable to the registration form used for such Shelf Registration, if
required by the Securities Act, or if reasonably requested by the Holders of a
majority in aggregate principal amount of the Registrable Securities covered by
such Registration Statement or by any underwriter of such Registrable
Securities.
4. Liquidated Damages
(a) The Issuers agree that the Holders of Registrable Securities will
suffer damages if the Issuers fail to fulfill their obligations to Holders of
Registrable Securities under Section 2 and/or 3 hereof and that it would not be
feasible to ascertain the extent of such damages with precision. Accordingly, if
(i) the Exchange Registration Statement is not filed with the Commission on or
prior to the Exchange Filing Date or the Shelf Registration is not filed on or
prior to Shelf Filing Date, (ii) the Exchange Offer Registration Statement or
the Shelf Registration Statement, as the case may be, is not declared effective
by the Exchange Effectiveness Date or the Shelf Effectiveness Date, as the case
may be, (iii) the Exchange Offer Registration is not consummated on or prior to
the Exchange Offer Consummation Date (other than in the event the Company files
a Shelf Registration Statement), or (iv) the Shelf Registration Statement is
filed and declared effective by the Shelf Effectiveness Date but shall
thereafter cease to be effective (at any time that the Company is obligated to
maintain the effectiveness thereof) without being succeeded within 45 days by an
additional Registration Statement filed and declared effective (each such event
referred to in clauses (i) through
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(iv), a "Registration Default"), the Company will be obligated to pay liquidated
damages to each Holder of Registrable Securities affected by such Registration
Default, during the period of one or more such Registration Defaults, at a rate
of $.192 per full or partial week per $1,000 amount of Notes until (i) the
applicable Registration Statement is filed, (ii) the Exchange Registration
Statement is declared effective and the Exchange Offer is consummated, (iii) the
Shelf Registration Statement is declared effective or (iv) the Shelf
Registration Statement again becomes effective, as the cause may be. Following
the cure of all Registration Defaults, the accrual of liquidated damages will
cease.
(b) Notwithstanding the foregoing provisions of Section 3(b), the Company
may issue a notice that the Shelf Registration Statement is unusable pending the
announcement of a material corporate transaction or development and may issue
any notice suspending use of the Shelf Registration Statement required under
applicable securities laws to be issued and, in the event that the aggregate
number of days in any consecutive twelve-month period for which all such notices
are issued and effective does not exceed 30 days in the aggregate, then
liquidated damages shall cease to accrue during such period in which such
notices are issued and effective.
(c) The Issuers shall notify the Trustee within one Business Day after each
and every date on which an event occurs in respect of which Liquidated Damages
is required to be paid (an "Event Date"). Any amounts of Liquidated Damages due
pursuant to Section 4(a) will be payable in cash semi-annually on each interest
payment date for the Registrable Securities (to the Holders of record entitled
to such interest payment), commencing with the first such date occurring after
any such Liquidated Damages commence to accrue. The amount of Liquidated Damages
will be determined on the basis of a 360-day year comprised of twelve 30-day
months.
5. Underwritten Registrations
If any of the Registrable Securities covered by any Shelf Registration are
to be sold in an underwritten offering, the investment banker or investment
bankers and manager or managers that will manage the offering will be selected
by the Holders of a majority in aggregate principal amount of the Registrable
Securities included in such offering and reasonably acceptable to the Issuers.
6. Registration Procedures
In connection with the filing of any Registration Statement, the Issuers
shall as expeditiously as possible:
(a) Before filing any Registration Statement or Prospectus or any
amendments or supplements thereto (not including documents that would be
incorporated or deemed to be incorporated therein by reference), the Issuers
shall afford the Holders covered by such Registration Statement, their counsel
and the managing underwriters, if any, an opportunity to review, promptly,
copies of all such documents proposed to be filed; provided, however, that the
Issuers shall not be required to afford such persons an opportunity to review a
copy of (i) any such document that has not been materially changed from a copy
of such document that such person was previously afforded an opportunity to
review and (ii) any amendments or supplements to a Registration Statement or
Pro-
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spectus which are made solely as a result of any filing by the Issuers of
reports required to be filed pursuant to the Exchange Act.
(b) Prepare and file with the SEC such amendments and post-effective
amendments to each Registration Statement as may be necessary to keep such
Registration Statement continuously effective for the time periods prescribed
hereby; 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 provisions of the Securities Act, the Exchange Act and the rules and
regulations of the SEC promulgated thereunder applicable to it with respect to
the disposition of all securities covered by such Registration Statement as so
amended or in such Prospectus as so supplemented.
(c) Notify the selling Holders of Registrable Securities, their counsel and
the managing underwriters, if any, promptly (but in any event within two
business days after becoming aware thereof), and confirm such notice in writing,
(i) when a Prospectus or 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 such
notice a written 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 but excluding 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 such
Registration Statement or of any order preventing or suspending the use of any
preliminary prospectus or the initiation of any proceedings for that purpose,
(iii) of the receipt by the Issuers of any notification with respect to the
suspension of the qualification or exemption from qualification of such
Registration Statement or any of the Registrable Securities for offer or sale in
any jurisdiction, or the initiation or threatening of any proceeding for such
purpose, (iv) of the happening of any event, the existence of any condition or
any 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 such 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 the light of the circumstances under which they were made, not misleading,
and (v) of the Issuers' reasonable determination that a post-effective amendment
to such Registration Statement would be appropriate.
(d) Use its 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 or suspending the qualification (or exemption
from qualification) of any of the Registrable Securities for sale in any
jurisdiction, and, if any such order is issued, to obtain the withdrawal of any
such order at the earliest possible moment.
(e) If requested by the managing underwriters, if any, or the Holders of a
majority in aggregate principal amount of the Registrable Securities being sold
in connection with an un-
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derwritten offering, (i) promptly incorporate in a prospectus supplement or
post-effective amendment such information as the managing underwriters, if any,
or such Holders 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 Issuers received notification of the matters to
be incorporated in such prospectus supplement or post-effective amendment, and
(iii) supplement or make amendments to such Registration Statement.
(f) Furnish to each selling Holder of Registrable Securities who so
requests and to counsel and each managing underwriter, if any, without charge,
one conformed copy of the Registration Statement 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) Deliver to each selling Holder of Registrable Securities, their counsel
and the underwriters, if any, without charge, as many copies of each Prospectus
(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 6, each
Issuer hereby consents to the use of such Prospectus and each amendment or
supplement thereto by each of the selling Holders of Registrable Securities and
the underwriters or agents, if any, in connection with the offering and sale of
the Registrable Securities covered by such Prospectus and any amendment or
supplement thereto until such time as the Issuers have notified the Holders to
discontinue the use of such Prospectus.
(h) Prior to any public offering of Registrable Securities, to register or
qualify, and to cooperate with the selling Holders of Registrable Securities,
the underwriters, if any, and their respective counsel in connection with the
registration or qualification (or exemption from such registration or
qualification) of such Registrable Securities for offer and sale under the
securities or Blue Sky laws of such jurisdictions within the United States as
any selling Holder, or the managing underwriters reasonably request in writing;
provided that where Registrable Securities are offered other than through an
underwritten offering, the Issuers agree to cause their counsel to perform Blue
Sky investigations and file registrations and qualifications required to be
filed pursuant to this Section 6(h); 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 Registrable Securities covered by the applicable
Registration Statement; provided, however, that no Issuer shall be required to
(A) qualify generally to do business 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) become
subject to taxation in any such jurisdiction where it is not then so subject.
(i) Cooperate with the selling Holders of Registrable Securities and the
managing underwriters, if any, to facilitate the timely preparation and delivery
of certificates representing Registrable Securities to be sold, which
certificates shall not bear any restrictive legends and shall be in a form
eligible for deposit with The Depository Trust Company ("DTC"); and enable such
Registrable Securities to be in such denominations and registered in such names
as the managing under-
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writers, if any, or selling holders of Registrable Securities may reasonably
request at least two business days prior to any sale of Registrable Securities.
(j) Upon the occurrence of any event contemplated by paragraph 6(c)(v) or
6(c)(vi), as promptly as practicable prepare and file with the SEC, at the joint
and several expense of each of the Issuers, 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 Registrable Securities being sold thereunder, such
Prospectus will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(k) Use its best efforts to cause the Registrable Securities covered by a
Shelf Registration Statement to be rated with the appropriate rating agencies,
if so requested by the Holders of a majority in aggregate principal amount of
Registrable Securities covered by such Registration Statement or the managing
underwriters, if any.
(l) Prior to the effective date of any Registration Statement relating to
the Registrable Securities, (i) provide the Trustee with printed certificates
for the Registrable Securities covered by such Registration Statement in a form
eligible for deposit with DTC and (ii) provide a CUSIP number(s) for the
Registrable Securities.
(m) Cooperate with each selling Holder of Registrable Securities covered by
any Registration Statement and each underwriter, if any, participating in the
disposition of such Registrable Securities and their respective counsel in
connection with any filings required to be made with the National Association of
Securities Dealers, Inc. (the "NASD").
(n) In the event a Shelf Registration is filed, and if requested by Holders
of a majority in aggregate principal amount of Registrable Securities covered by
such Registration Statement, enter into an underwriting agreement in form, scope
and substance as is customary in underwritten offerings and take all such other
actions as are reasonably requested by the managing underwriters in order to
expedite or facilitate the registration or the disposition of such Registrable
Securities, and in such connection, (i) make such representations and warranties
to the underwriters, with respect to the business of the Issuers and their
respective subsidiaries, and the Registration Statement, Prospectus and
documents, if any, incorporated or deemed to be incorporated by reference
therein, in each case, in form, substance and scope as are customarily made by
issuers to underwriters in underwritten offerings of securities similar to the
Registrable Security, and confirm the same if and when requested; (ii) obtain
opinions of counsel to the Issuers and updates thereof in form, scope 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 underwriter or
underwriters from the independent certified public accountants of the Issuers
(and, if necessary, any other independent certified public accountants of any
subsidiary of the Issuers or business acquired by the
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Issuers 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 of securities similar to the Registrable Securities; 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 8 (or such other less favorable provisions and procedures acceptable
to Holders of a majority in aggregate principal amount of Registrable Securities
covered by such Registration Statement and the managing underwriters or agents)
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.
(o) Make available for inspection by a representative of the selling
Holders of Registrable Securities, any underwriter participating in any such
disposition of Registrable Securities, if any, and any attorney or accountant or
other agent retained by any such representative of such selling Holders 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 Issuers and their
subsidiaries, and cause the officers, directors and employees of the Issuers and
their subsidiaries to supply all information, in each case reasonably requested
by any such Inspector in connection with such Registration Statement; provided,
however, that any information that is designated in writing by the Issuers, in
good faith, as confidential at the time of delivery of such information, shall
be kept confidential by such Inspector unless (i) disclosure of such information
is required by court or administrative order, (ii) other than under the
circumstances contemplated by, and for the time period permitted by, Section 10,
disclosure of such information, in the opinion of counsel to such Inspector, is
necessary to avoid or correct a misstatement or omission of a material fact in
the Registration Statement, Prospectus or any supplement or post-effective
amendment thereto or disclosure is otherwise required by law, or (iii) such
information becomes generally available to the public other than as a result of
a disclosure or failure to safeguard by such Inspector. Each selling Holder of
such Registrable Securities will be required to agree that information obtained
by it as a result of such inspections shall be deemed confidential and shall not
be used by it as the basis for any market transactions in the securities of the
Issuers unless and until such is made generally available to the public. Each
selling Holder of such Registrable Securities will be required to further agree
that it will, upon learning that disclosure of any such information is sought in
a court or administrative tribunal of competent jurisdiction, give notice to the
Issuers and allow the Issuers to undertake appropriate action to prevent
disclosure of the information deemed confidential at its expense and will use
reasonable efforts to cooperate with the Issuers in attempting to prevent such
disclosure.
(p) Provide an indenture trustee for the Registrable Securities, and cause
the Indenture to be qualified under the TIA not later than the effective date of
the first Registration Statement relating to the Registrable Securities; and in
connection therewith, cooperate with the trustee under any such indenture and
the selling holders of the Registrable 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 best efforts to
cause such trustee to execute, all 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.
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(q) Comply with all applicable rules and regulations of the SEC and make
generally available to its securityholders earnings statements satisfying the
provisions of Section 10(a) of the Securities Act and Rule 158 thereunder (or
any similar rule promulgated under the Securities Act) no later than 45 days
after the end of any 12-month period (or 90 days after the end of any 12-month
period if such period is a fiscal year) (i) commencing at the end of any fiscal
quarter in which Registrable Securities are sold to underwriters in a firm
commitment or best efforts underwritten offering and (ii) if not sold to
underwriters in such an offering, commencing on the first day of the first
fiscal quarter of the Company after the effective date of a Registration
Statement, which statements shall cover said 12-month periods.
(r) If an Exchange Offer Registration is to be consummated, upon delivery
of the Registrable Securities by such selling Holders to the Issuers (or to such
other Person as directed by the Issuers) in exchange for the Exchange Notes, the
Issuers shall xxxx, or caused to be marked, on such Registrable Securities that
such Registrable Securities are being cancelled in exchange for the Exchange
Notes; in no event shall such Registrable Securities be marked as paid or
otherwise satisfied.
(s) Use its best efforts to take all other steps reasonably necessary to
effect the registration of the Registrable Securities covered by a Registration
Statement contemplated hereby.
The Issuers may require each selling Holder of Registrable Securities as to
which any registration is being effected to furnish to the Issuers such
information regarding such seller and the distribution of such Registrable
Securities as the Issuers may, from time to time, reasonably request in writing
and to otherwise cooperate in the preparation of the Registration Statement. The
Issuers may exclude from such registration the Registrable Securities of any
seller who unreasonably fails to furnish such information within a reasonable
time after receiving such request. If the identity of a seller of Registrable
Securities is to be disclosed in a registration statement, such selling holder
shall be permitted to include all information regarding such seller as it shall
reasonably request. At any time during the effectiveness of any Registration
Statement with respect to the Registrable Securities, any selling Holder becomes
aware of any change materially affecting the accuracy of the information
contained in the Registration Statement or related Prospectus, such Holder will
notify the Issuers of such change.
Each Holder, upon receipt of any notice from the Issuers of the happening
of any event of the kind described in Section 6(c), will forthwith discontinue
disposition of such Registrable Securities covered by such Registration
Statement or Prospectus, until such Holder's receipt of the copies of the
supplemented or amended Prospectus contemplated by Section 6(c), or until it is
advised in writing (the "Advice") by the Issuers that the use of the applicable
Prospectus may be resumed. In the event the Issuers shall give any such notice,
the Shelf Termination Date and the Exchange Effectiveness Period shall be
extended by the number of days during such periods from and including the date
of the giving of such notice to and including the date when each seller of
Registrable Securities covered by such Registration Statement shall have
received the copies of the supplemented or amended Prospectus contemplated by
Section 6(c) or the Advice.
-14-
7. Registration Expenses
(a) All fees and expenses, other than underwriting discounts and
commissions and transfer taxes, incident to the performance of or compliance
with this Agreement by the Issuers shall be borne by the Issuers, jointly and
severally, whether or not a 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 Registrable Securities or Exchange Notes and
determination of the eligibility of the Registrable Securities or Exchange Notes
for investment under the laws of such jurisdictions (x) where the Holders of
Registrable Securities are located, in the case of the Exchange Notes, or (y) as
provided in Section 6(h), in the case of Registrable Securities)), (ii) printing
expenses (including, without limitation, expenses of printing certificates for
Registrable Securities or Exchange 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 Registrable Securities, by the
Holders of a majority in aggregate principal amount of the Registrable
Securities included in the Registration Statement), (iii) messenger, telephone
and delivery expenses, (iv) fees and disbursements of one counsel for the
Issuers and reasonable fees and disbursements of counsel for the sellers of
Registrable Securities (subject to the provisions of Section 7(b)), (v) fees and
disbursements of all independent certified public accountants referred to in
Section 6(o)(iii) (including, without limitation, the expenses of any special
audit and "cold comfort" letters required by or incident to such performance),
(vi) the fees and expenses of any "qualified independent underwriter" or other
independent appraiser participating in an offering pursuant to Rule 2720 of the
Conduct Rules of the NASD, (vii) rating agency fees, (viii) fees and expenses of
all other Persons retained by the Issuers, (ix) internal expenses of the Issuers
(including, without limitation, all salaries and expenses of officers and
employees of the Issuers performing legal or accounting duties) and, (xi) the
expense of any annual audit (collectively, "Registration Expenses").
(b) In connection with any Registration Statement hereunder or any
amendment thereto, the Issuers shall reimburse the Holders of the Registrable
Securities being registered in such registration for the reasonable fees and
disbursements of not more than one counsel chosen by the Holders of a majority
in aggregate principal amount of the Registrable Securities to be included in
such Registration Statement and other reasonable out-of-pocket expenses of the
Holders of Registrable Securities incurred in connection with the registration
of the Registrable Securities.
8. Indemnification
(a) The Issuers, jointly and severally, agree to indemnify and hold
harmless each Holder of Registrable Securities covered by a Registration
Statement, the officers and directors of each such person, and each person, if
any, who controls any such person within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act (each, a "Participant"), from
and against any and all losses, claims, damages and liabilities (including,
without limitation, the reasonable legal fees and other expenses actually
incurred in connection with any suit, action or proceeding or any claim
asserted) caused by, arising out of or based upon any untrue statement or
alleged untrue
-15-
statement of a material fact contained in such Registration Statement or any
related Prospectus (as amended or supplemented if the Issuers shall have
furnished any amendments or supplements thereto) or any related 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 the light of the circumstances
under which they were made, not misleading, except insofar as such losses,
claims, damages or liabilities are caused by any untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity
with information relating to any Participant furnished to the Issuers in writing
by such Participant expressly for use therein; provided that the Issuers will
not be liable to any Participant with respect to any such untrue statement or
omission in any preliminary prospectus that is corrected in the related
Prospectus (or any amendment or supplement thereto) if the person asserting any
such loss, claim, damage or liability purchased Registrable Securities or
Exchange Notes which are the subject thereof from such Participant in reliance
upon such preliminary prospectus but was not sent or given a copy of the related
Prospectus (as amended or supplemented) at or prior to the written confirmation
of the sale of such Registrable Securities or Exchange Notes, as the case may
be, to such person, unless such failure to deliver such Prospectus (as amended
or supplemented) was a result of noncompliance by the Issuers with Section 6 of
this Agreement.
(b) Each Participant will be required to agree, severally and not jointly,
to indemnify and hold harmless the Issuers, their respective directors and
officers and each person who controls the Issuers 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 Issuers to each Participant, but only (i) with
reference to information relating to such Participant furnished to the Issuers
in writing by or on behalf of such Participant expressly for use in any
Registration Statement or Prospectus, any amendment or supplement thereto, or
any preliminary prospectus or (ii) with respect to any untrue statement or
representation made by such Participant in writing to the Issuers. The liability
of any Participant under this paragraph shall in no event exceed the proceeds
received by such Participant from sales of Registrable Securities or Exchange
Notes giving rise to such obligations.
(c) 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 Person") shall promptly
notify the person against whom such indemnity may be sought (the "Indemnifying
Person") in writing, and the Indemnifying Person, upon request of the
Indemnified Person, shall retain counsel reasonably satisfactory to the
Indemnified Person to represent the Indemnified Person and any others the
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; provided, however, that the failure to so notify the
Indemnifying Person shall not relieve it of any obligation or liability which it
may have hereunder or otherwise (unless and only to the extent that such failure
directly results in an actual loss or compromise of any material rights or
defenses by the Indemnifying Person). In any such proceeding, any Indemnified
Person 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 Person unless (i)
the Indemnifying Person and the Indemnified Person shall have mutually agreed in
writing to the contrary, (ii) the Indemnifying Person has failed within a
reasonable time to retain counsel reasonably satisfactory to the Indemnified
Person or (iii) the named parties in
-16-
any such proceeding (including any impleaded parties) include both the
Indemnifying Person and the Indemnified Person and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the Indemnifying Person
shall not, in connection with any proceeding or related proceeding in the same
jurisdiction, be liable for the fees and expenses of more than one separate firm
(in addition to any local counsel) for all Indemnified Persons, and that all
such fees and expenses shall be reimbursed at least quarterly. Any such separate
firm for the Participants and such control persons of Participants shall be
designated in writing by Participants who sold a majority in interest of
Registrable Securities sold by all such Participants in the related registration
and any such separate firm for the Issuers, their directors, officers and such
control persons of the Issuers shall be designated in writing by the Issuers.
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 non-appealable judgment for the plaintiff, the Indemnifying
Person agrees to indemnify any Indemnified Person from and against any loss or
liability by reason of such settlement or judgment. No Indemnifying Person
shall, without the prior written consent of the Indemnified Person, effect any
settlement of any pending or threatened proceeding in respect of which any
Indemnified Person is or could have been a party and indemnity could have been
sought hereunder by such Indemnified Person, unless such settlement includes an
unconditional release of such Indemnified Person from all liability on claims
that are the subject matter of such proceeding.
(d) If the indemnification provided for in the first and second paragraphs
of this Section 8 is unavailable to, or insufficient to hold harmless, an
Indemnified Person in respect of any losses, claims, damages or liabilities
referred to therein, then each Indemnifying Person under such paragraphs, in
lieu of indemnifying such Indemnified Person thereunder and in order to provide
for just and equitable contribution, shall contribute to the amount paid or
payable by such Indemnified Person as a result of such losses, claims, damages
or liabilities in such proportion as is appropriate to reflect the relative
fault of the Indemnifying Person or Persons on the one hand and the Indemnified
Person or Persons on the other in connection with the statements or omissions
that resulted in such losses, claims, damages or liabilities (or actions in
respect thereof). The relative fault of the parties 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 Issuers on the one hand or by the
Participants or such other Indemnified Person, as the case may be, on the other,
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission and any other equitable
considerations appropriate under the circumstances.
(e) The parties agree that it would not be just and equitable if
contribution pursuant to this Section 8 were determined by pro rata allocation
(even if the Participants 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 Person as a result of the losses, claims,
damages and liabilities 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 Person in
connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 8, in no event shall a
Participant be required to contribute any amount in excess of the
-17-
amount by which proceeds received by such Participant from sales of Registrable
Securities or Exchange Notes, as the case may be, exceeds the amount of any
damages that such Participant 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
10(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation.
(f) The indemnity and contribution agreements contained in this Section 8
will be in addition to any liability which the Indemnifying Persons may
otherwise have to the Indemnified Persons referred to above.
9. Rule 144 and 144A
The Company covenants that it will file the reports required to be filed by
it under 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
is not required to file such reports, the Company will, upon the request of any
Holder of Registrable Securities, make publicly available annual reports and
such information, documents and other reports of the type specified in Sections
13 and 15(d) of the Exchange Act. The Company further covenant that, for so long
as any Registrable Securities remain outstanding, to make available to any
Holder or beneficial owner of Registrable Securities in connection with any sale
thereof and any prospective purchaser of such Registrable Securities from such
Holder or beneficial owner, the information required by Rule 144A(d)(4) under
the Act in order to permit resales of such Registrable Securities pursuant to
Rule 144A.
10. Miscellaneous
(a) No Inconsistent Agreements. No Issuer has entered, as of the date
hereof, and no Issuer shall enter, after the date of this Agreement, into any
agreement with respect to any of its securities that is inconsistent with the
rights granted to the Holders of Registrable Securities in this Agreement or
otherwise conflicts with the provisions hereof. No Issuer has entered and no
Issuer will enter into any agreement with respect to any of its securities which
will grant to any person piggy-back rights with respect to a Registration
Statement.
(b) Adjustments Affecting Registrable Securities. None of the Issuers
shall, directly or indirectly, take any action with respect to the Registrable
Securities as a class that would adversely affect the ability of the Holders of
Registrable Securities to include such Registrable Securities in a registration
undertaken pursuant to this Agreement.
(c) Amendments and Waivers. The provisions of this Agreement, including the
provisions of this sentence, may not be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof may not be given,
unless the Issuers have obtained the written consent of Holders of at least a
majority of the then outstanding aggregate principal amount of Registrable
Securities. Notwithstanding the foregoing, a waiver or consent to depart from
the provisions hereof with respect to a matter that relates exclusively to the
rights of Holders of Registrable Securities whose securities are being sold
pursuant to a Registration Statement and that does not di-
-18-
rectly or indirectly affect, impair, limit or compromise the rights of other
Holders of Registrable Securities may be given by Holders of at least a majority
in aggregate principal amount of the Registrable 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.
(d) 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 the Registrable Securities, at the most current
address given by such Holder to the Company in accordance with the
provisions of this Section 12(d), with a copy in like manner to the Holders
as follows:
The Chase Manhattan Bank
DLJ Bridge Finance, Inc.
BankBoston, N.A.
x/x Xxx Xxxxx Xxxxxxxxx Bank
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No.: (212) 270-[ ]
Attention: [ ]
with a copy to:
Xxxxxx Xxxxxx & Xxxxxxx
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No.: (000) 000-0000
Attention: Xxxxxxxx Xxxxxxxxx, Esq.
(ii) if to the Issuers as follows:
Republic Engineered Steels, Inc.
000 Xxxxxxx Xxxx, X.X.
Xxxxxxxxx, Xxxx 00000
Facsimile No.: (000) 000-0000
Attention: [ ]
with a copy to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx [ ]
Facsimile No.: (000) 000-0000
-19-
Attention: [ ]
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 next-day air courier; and when receipt is
acknowledged by the addressee, if telecopied.
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.
(e) Successors and Assigns. This Agreement shall inure to the benefit of
and be binding upon the successors and assigns of each of the parties,
including, without limitation and without the need for an express assignment,
subsequent Holders of Registrable Securities.
(f) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(g) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(h) 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. EACH OF THE PARTIES HERETO AGREES TO
SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.
(i) 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 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 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.
(j) Joint and Several Obligations. Each of the obligations of the Issuers
under this Agreement shall be joint and several obligations of each of them.
(k) Securities Held by the Issuers or Their Affiliates. Whenever the
consent or approval of Holders of a specified percentage of Registrable
Securities is required hereunder, Registrable Securities held by the Issuers or
their affiliates (as such term is defined in Rule 405 under the
-20-
Securities Act) shall not be counted in determining whether such consent or
approval was given by the Holders of such required percentage.
-21-
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
REPUBLIC ENGINEERED STEELS, INC.
By: __________________________________
Name:
Title:
THE GUARANTORS:
[ ]
By: __________________________________
Name:
Title:
[ ]
HOLDERS of NOTES:
THE CHASE MANHATTAN BANK,
on behalf of the Holders
of Notes
By: __________________________________
Name:
Title:
DLJ BRIDGE FINANCE, INC.
on behalf of the Holders
of Notes
By: __________________________________
Name:
Title:
-22-
BANKBOSTON, N.A.,
on behalf of the Holders
of Notes
By: __________________________________
Name:
Title:
