Exhibit 4.2
REGISTRATION RIGHTS AGREEMENT
Registration Rights Agreement (the "Agreement"), dated as of September
8, 1997, by and among Local Financial Corporation (the "Company"), a Delaware
corporation, Friedman, Billings, Xxxxxx & Co., Inc., as Placement Agent (as
herein defined), and each of the undersigned Investors (hereinafter referred to
individually as an "Investor" and collectively as the "Investors").
WITNESSETH:
WHEREAS, the Company, the Placement Agent and each of the Investors
have entered into a Purchase Agreement, dated as of September 8, 1997, providing
for the purchase by the Investors of: (i) the Company's Senior Notes due 2004
(the "Senior Notes"); (ii) shares of the Company's common stock, par value $.01
per share (the "Common Stock"); or (iii) a combination of Senior Notes and
Common Stock, in each case subject to the terms and conditions set forth
therein; and
WHEREAS, the Company desires to provide the Investors with certain
registration rights with respect to the Senior Notes and the shares of Common
Stock purchased pursuant to the Purchase Agreement or, in the case of the
Placement Agent, issued upon exercise of the Warrants;
NOW, THEREFORE, in consideration of the premises and mutual agreements
set forth herein and for other good and valuable consideration, the receipt and
the sufficiency of which are hereby acknowledged, the Company and the Investors
agree as follows:
Section 1. Definitions.
As used in this Agreement, the following terms shall have the following
meanings:
(a) "Affiliate" shall mean, with respect to any Person, any
Person that, directly or indirectly, controls, is controlled by or is
under common control with such Person. For the purposes of this
definition, "control" when used with respect to any specified Person
means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings corresponding to the foregoing.
(b) "Business Day" shall mean any day except a Saturday,
Sunday or other day on which commercial banks and savings institutions
in the State of Oklahoma are authorized or obligated by law to close.
(c) "Commission" shall mean the Securities and Exchange
Commission, or any other federal agency at the time administering the
Securities Act.
(d) "Common Stock" shall mean the common stock, par value $.01
per share, of the Company.
(e) "Exchange Act" shall mean the Securities Exchange Act of
1934, as amended.
(f) "Holder" shall mean any holder of outstanding Registrable
Securities, including any Person to whom Registrable Securities have
been transferred in compliance with this Agreement.
(g) "Indenture" shall mean the Indenture dated as of September
2, 1997 between the Company and The Bank of New York, a New York
banking corporation, as trustee, as the same may be amended from time
to time in accordance with the terms thereof, providing for the
issuance of the Senior Notes.
(h) "Initiating Holders" shall mean one or more Holders of
either: (i) not less than 35% in aggregate principal amount of the
Senior Notes; or (ii) not less than 25% of the shares of Common Stock
then outstanding.
(i) "Issue Date" shall mean September 2, 1997, the date of
original issuance pursuant to the Purchase Agreement of the Senior
Notes and the shares of Common Stock.
(j) "Person" shall mean an individual, a corporation, a
partnership, an association, a trust or any other entity or
organization, including a government or political subdivision or an
agency or instrumentality thereof.
(k) "Placement Agent" means Friedman, Billings, Xxxxxx & Co.,
Inc., in its capacity as private placement agent with respect to the
offering of Common Stock and Senior Notes pursuant to the Purchase
Agreement.
(l) "Prospectus" shall mean the prospectus included in a Shelf
Registration Statement, including any preliminary prospectus, and any
such prospectus as amended or supplemented by any prospectus
supplement, including a prospectus supplement with respect to the terms
of the offering of any portion of the Registrable Securities covered by
a Shelf Registration Statement, and by all other amendments
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and supplements to a prospectus, including post-effective amendments,
and in each case including all material incorporated by reference
therein.
(m) "Purchase Agreement" shall mean the Purchase Agreement,
dated as of September 2, 1997, among the Company, the Placement Agent
and the Investors, as amended, supplemented or otherwise modified from
time to time.
(n) "Registrable Securities" shall mean (i) the Senior Notes
and (ii) the shares of Common Stock issued pursuant to the Purchase
Agreement (including the shares of Common Stock which may be issued
upon exercise of the Warrants) and (iii) any shares of the capital
stock (or rights to receive capital stock of the Company) issued in
respect of the Common Stock issued pursuant to the Purchase Agreement
(including shares of Common Stock issuable upon exercise of the
Warrants), by reason of, or in connection with, any stock dividend,
stock distribution, stock split, purchase in any rights offering or in
connection with any combination of shares, recapitalization, merger or
consolidation, or any other equity securities issued pursuant to any
other pro rata distribution with respect to the Common Stock issued
pursuant to the Purchase Agreement (including shares of Common Stock
issuable upon exercise of the Warrants). Notwithstanding the foregoing,
Registrable Securities shall not include otherwise Registrable
Securities (i) sold to or through a broker or dealer or underwriter or
(ii) sold in a transaction exempt from the registration and prospectus
delivery requirements of the Securities Act under Section 4(1) thereof,
if in any such case, all transfer restrictions and restrictive legends
with respect thereto, if any, are removed upon the consummation of such
sale.
(o) "Securities Act" shall mean the Securities Act of 1933, as
amended, and the rules and regulations of the Commission thereunder.
(p) "Senior Notes" shall mean the Senior Notes due 2004 of the
Company issued by the Company pursuant to the Purchase Agreement.
(q) "Shelf Registration" shall have the meaning set forth in
Section 3 of this Agreement.
(r) "Shelf Registration Statement" shall mean a "shelf"
registration statement of the Company pursuant to the provisions of
Section 3 of this Agreement which covers all of the Registrable
Securities required to be registered on an appropriate form for
purposes of an offering on a continuous basis pursuant to Rule 415
under the Securities Act, or any similar rule that maybe adopted by the
Commission.
(s) "Warrants" shall mean the Warrants of the Company issued
by the Company to the Placement Agent pursuant to the Purchase
Agreement as
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compensation, in part, for its efforts in advising and assisting the
Company in the sale of Common Stock and Senior Notes.
Section 2. Restrictions on Transferability.
The Registrable Securities shall not be sold, transferred or otherwise
disposed of, except in accordance with and subject to the provisions of the
Securities Act and the rules and regulations of the Commission promulgated
thereunder.
Section 3. Shelf Registration Rights.
(a) The Company shall, at the Company's cost, subject to Section 6
hereof,
(i) within 120 days after the Issue Date, file with the
Commission, and thereafter use its best efforts to cause to be declared
effective as promptly as practicable, a Shelf Registration Statement
relating to the offer and sale of the Registrable Securities by the
Holders from time to time;
(ii) use its best efforts to keep the Shelf Registration
Statement continuously effective in order to permit the Prospectus
forming a part thereof to be usable by Holders identified as selling
security holders in such Shelf Registration Statement for a period of
two years from the date the Shelf Registration Statement is declared
effective by the Commission or until such earlier date as all
Registrable Securities shall have been disposed of or on which all
Registrable Securities shall be saleable without registration pursuant
to Rule 144 (or any similar provision then in effect), or as a result
of any changes in the existing registration requirements under the
Securities Act which eliminate the Holders' need for the Shelf
Registration Statement, or upon receipt of an opinion of counsel
satisfactory to the Company which provides that all Registrable
Securities may be resold without registration in a transaction that
would result in the Registrable Securities being freely tradeable
provided that the purchaser is not an affiliate of the Company (the
Effectiveness Period"); and
(iii) notwithstanding any other provisions hereof, use its
best efforts to ensure that (i) any Shelf Registration Statement and
any amendment thereto and any Prospectus forming a part thereof and any
supplement thereto complies in all material respects with the
Securities Act and the rules and regulations thereunder, (ii) any Shelf
Registration Statement and any amendment thereto does not, when it
becomes effective, contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading and (iii) any
Prospectus forming a part of any Shelf Registration Statement, and any
supplement to such Prospectus (as amended or supplemented from time to
time), does not include an untrue statement of a material fact or omit
to state a material fact necessary in order to make the statements
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therein, in light of the circumstances under which they were made, not
misleading, except that the Company shall be entitled to rely on the
information provided to them by the Holders with respect to such
Holders.
(b) Any Holder desiring to sell Registrable Securities pursuant to the
Shelf Registration Statement shall provide not less than five (5) days' prior
written notice to the Company. Any such notice shall specify the aggregate
principal amount of the Senior Notes or the number of shares of Common Stock
proposed to be sold and the intended method of disposition thereof. The Company
shall use its best efforts to promptly file any required amendment(s) to the
Shelf Registration Statement in order to facilitate any sales of Senior Notes
and/or Common Stock as described above. Notwithstanding anything herein to the
contrary, during such period that the Company is conducting an Underwritten
Offering pursuant to Section 4 hereof, a Holder who does not elect to
participate in such Underwritten Offering shall have its right to sell
Registrable Securities pursuant to the Shelf Registration Statement suspended.
(c) If Initiating Holders so elect, the offering of such Registrable
Securities pursuant to such Shelf Registration shall be in the form of an
underwritten offering. If any Shelf Registration is in the form of an
underwritten offering, the Initiating Holders will select and retain the
investment banker or investment bankers and manager or managers that will
administer the offering; provided that such investment bankers and managers must
be reasonably satisfactory to the Company.
Section 4. Underwritten Offerings.
(a) In connection with any public underwriting of Company securities
that are covered by a Shelf Registration Statement, the Holders of Registrable
Securities to be distributed by such underwriters shall be parties to the
underwriting agreement between the Company and such underwriters and any such
underwriting agreement shall require that the representations and warranties by,
and the other agreements on the part of, the Company to and for the benefit of
such underwriters also shall be made to and for the benefit of such Holders and
that the conditions precedent to the obligations of such underwriters under such
underwriting agreement shall be conditions precedent to the obligations of such
Holders.
(b) No Holder may participate in any underwritten offering under
Section 3 unless such Holder (i) agrees to sell its Registrable Securities on
the basis provided in any underwriting arrangement approved by the Company and
(ii) completes and executes all questionnaires, powers of attorney, indemnities,
securities escrow agreements, underwriting agreements and other documents
required under the terms of such underwriting, and furnishes to the Company such
information as the Company may reasonably request in writing for inclusion in
the Shelf Registration Statement (and the Prospectus included therein);
provided, however, that no Holder shall be required to make any representations
or warranties to or agreements with the Company or the underwriters other than
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representations, warranties or agreements regarding such Holder and such
Holder's intended method of distribution and any other representation required
by law.
(c) In the case of any underwritten offering, the Company shall provide
written notice to the Holders of all of the Registrable Securities of such
underwritten offering at least 30 days prior to the filing of a Prospectus
supplement for such underwritten offering. Such notice shall (x) offer each such
Holder the right to participate in such underwritten offering, (y) specify a
date, which shall be no earlier than 10 days following the date of such notice,
by which the Holder must inform the Company of its intent to participate in such
underwritten offering and (z) include the instructions such Holder must follow
in order to participate in such underwritten offering.
Section 5. Registration Expenses.
The Company will pay all reasonable registration expenses in connection
with any registration pursuant to Section 3 of this Agreement, including,
without limitation, all registration and filing fees, fees with respect to
filings required to be made with the National Association of Securities Dealers,
fees and expenses of compliance with securities or blue sky laws, printing
expenses, and fees and expenses of counsel for the Company and of all
independent public accountants of the Company (including the expenses of any
"comfort" letters and updates thereof required by or incident to the foregoing)
in connection with such registration, except that the following expenses shall
not be borne by the Company: underwriting discounts and commissions,
underwriting expenses and transfer taxes, if any (other than discounts,
commissions, expenses and transfer taxes relating to securities offered and sold
by the Company) and cost of liability insurance (except to the extent carried by
the Company on its own behalf).
Section 6. Registration Procedures.
Whenever the Company seeks to effect the registration of any shares of
Registrable Securities under the Securities Act as provided in Section 3, the
Company agrees it will, as expeditiously as possible, subject to the terms and
conditions of such sections:
(a) prepare and file with the Commission the requisite Shelf
Registration Statement to effect such registration, use its best efforts to
cause such Shelf Registration Statement to become effective and promptly notify
each Holder of Registrable Securities covered by such Shelf Registration
Statement and any managing underwriter of the effectiveness thereof;
(b) prepare and file with the Commission such amendments and
supplements to such Shelf Registration Statement and the Prospectus used in
connection therewith as may be necessary to keep such Shelf Registration
Statement effective, notify each Holder of Registrable Securities covered by
such Shelf Registration Statement and any managing underwriter as promptly as
practicable of any request by the Commission for amendments
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or supplements to such Shelf Registration Statement or related Prospectus or for
additional information and comply with the provisions of the Securities Act with
respect to the disposition of all Registrable Securities covered by such Shelf
Registration Statement until the earlier of such time as all of such Registrable
Securities have been disposed of in accordance with the intended methods of
disposition by the seller or sellers thereof set forth in such Shelf
Registration Statement;
(c) furnish to each seller of Registrable Securities covered by such
Shelf Registration Statement such number of conformed copies of such Shelf
Registration Statement and of each such amendment and supplement thereto (in
each case including all exhibits), such number of copies of the Prospectus
contained in such Shelf Registration Statement (including each preliminary
prospectus and any summary prospectus) and any other prospectus filed under Rule
424 under the Securities Act, in conformity with the requirements of the
Securities Act, and such other documents as such seller may reasonably request;
(d) use its best efforts to register or qualify all Registrable
Securities covered by such Shelf Registration Statement under such other
securities or blue sky laws of such jurisdictions as each seller thereof shall
reasonably request, to keep such registration or qualification in effect for so
long as such Shelf Registration Statement remains in effect, and take any other
action which may be reasonably necessary or advisable to enable such seller to
consummate the disposition in such jurisdictions of the securities owned by such
seller, except that the Company shall not for any such purpose be required to
(i) qualify generally to do business as a foreign corporation in any
jurisdiction wherein it would not but for the requirements of this Section 6(d)
be obligated to be so qualified, (ii) subject itself to taxation in any such
jurisdiction or (iii) consent to general service of process in any such
jurisdiction;
(e) use its best efforts to cause all shares covered by such Shelf
Registration Statement to be registered with or approved by such other
governmental agencies or authorities as may be necessary to enable the seller or
sellers thereof to consummate the disposition of such shares;
(f) enter into customary agreements (including, in the case of an
underwritten offering, an underwriting agreement in customary form) and take all
other action in connection therewith in order to expedite or facilitate the
distribution of the Registrable Securities included in such Shelf Registration
Statement, and, in the case of an underwritten offering, make representations
and warranties to the holders of Registrable Securities covered by such Shelf
Registration Statement and to the underwriters in such form and scope as are
customarily made by issuers to underwriters in primary underwritten offerings
and confirm the same to the extent customary if and when requested;
(g) make available for inspection during normal business hours by a
representative of the Holders of Registrable Securities covered by such Shelf
Registration Statement and
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any managing underwriter, and any attorney or accountant retained by such
Holders or managing underwriter, all financial and other records, pertinent
corporate documents and properties of the Company, and cause the officers,
directors and employees of the Company to supply all information reasonably
requested by such representative, managing underwriter, attorney or accountant
in connection with such Shelf Registration Statement;
(h) use its best efforts to furnish to each Holder of Registrable
Securities covered by such Shelf Registration Statement a signed counterpart,
addressed to such Holder (and, in the case of an underwritten offering by the
Company, the underwriters), of
(i) an opinion of counsel for the Company, dated the effective
date of such Shelf Registration Statement (and, in case of an
underwritten offering by the Company, dated the date of each closing
under the underwriting agreement), reasonably satisfactory in form and
substance to such Holder, and
(ii) a "comfort" letter, dated the effective date of such
Shelf Registration Statement (and, in the case of an underwritten
offering, dated the date of each closing under the underwriting
agreement), signed by the independent public accountants who have
certified the Company's financial statements included in such Shelf
Registration Statement, covering substantially the same matters with
respect to such Shelf Registration Statement (and the Prospectus
included therein) and with respect to events subsequent to the date of
such financial statements, as are customarily covered in accountants'
letters delivered to underwriters in underwritten public offerings of
securities and such other financial matters as such Holder (or the
underwriters) may reasonably request;
(i) immediately notify each Holder of Registrable Securities covered by
such Shelf Registration Statement and any managing underwriter, at any time when
a Prospectus relating thereto is required to be delivered under the Securities
Act, of the happening of any event as a result of which the Prospectus included
in such Shelf Registration Statement, as then in effect, includes an untrue
statement of a material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein not misleading in
light of the circumstances under which they were made, and at the request of any
such Holder or any such managing underwriter, promptly prepare and furnish to
such Holder or managing underwriter a reasonable number of copies of a
supplement to or an amendment of such prospectus as may be necessary so that, as
thereafter delivered to the purchasers of such securities, such prospectus shall
not include 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 in light of the circumstances under which they were made;
(j) notify each Holder of Registrable Securities covered by such Shelf
Registration Statement and any managing underwriter as promptly as practicable
after becoming aware of the issuance by the Commission of any stop order
suspending the effectiveness of such
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Shelf Registration Statement or the initiation of any proceedings for that
purpose or the receipt by the Company of any notification with respect to the
suspension of qualification of any Registrable Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for such purpose
and make all reasonable efforts to obtain as promptly as practicable the
withdrawal of any order or other action suspending the qualification of the
Registrable Securities for sale in any jurisdiction;
(k) (i) otherwise use its best efforts to comply with all applicable
rules and regulations of the Commission, (ii) make available to its security
holders, as soon as reasonably practicable, an earnings statement covering the
period of at least twelve months, but not more than eighteen months, beginning
with the first full calendar month after the effective date of such Shelf
Registration Statement, which earnings statement shall satisfy the provisions of
Section 11(a) of the Securities Act, and (iii) not file any Shelf Registration
Statement or Prospectus or amendment or supplement to such Shelf Registration
Statement or Prospectus to which any such Holder of Registrable Securities
covered by any Shelf Registration Statement shall have reasonably objected on
the grounds that such amendment or supplement does not comply in all material
respects with the requirements of the Securities Act, such Holder having been
furnished with a copy thereof at least two Business Days prior to the filing
thereof;
(l) cause the Indenture to be qualified under the Trust Indenture Act
of 1939 (the "TIA") in connection with the registration of the Senior Notes, and
effect such changes to the Indenture as may be required for it to be so
qualified in accordance with the terms of the TIA and execute, and use its
reasonable best efforts to cause the trustee under the Indenture to execute, all
documents as may be required to effect such changes, and all other forms and
documents required to be filed with the Commission to enable the Indenture to be
so qualified in a timely manner; and
(m) to file all reports required to be filed by it under the Exchange
Act and the rules and regulations adopted by the Commission thereunder in a
timely manner and, to the extent the Company's obligation to file such reports
pursuant to Section 15(d) of the Exchange Act expires prior to the expiration of
the Effectiveness Period, the Company shall register the Registrable Securities
under the Exchange Act and shall maintain such registration through the
Effectiveness Period.
The Company may require each Holder of Registrable Securities as to
which any registration is being effected to furnish the Company with such
information and undertakings regarding such Holder and the distribution of such
securities as the Company may from time to time reasonably request in writing.
Each Holder of Registrable Securities covered by any Shelf Registration
Statement agrees (i) that upon receipt of any notice from the Company of the
happening of any event of the kind described in paragraph (i) of this Section 6,
such Holder will forthwith discontinue such Holder's disposition of Registrable
Securities pursuant to the Shelf Registration Statement relating to such
Registrable Securities until such Holder's receipt of
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the copies of the supplemented or amended Prospectus contemplated by paragraph
(i) of this Section 6 and, if so directed by the Company, will deliver to the
Company (at the Company's expense) all copies, other than permanent file copies
(which shall be conspicuously marked as such), then in such Holder's possession
of the Prospectus relating to such Registrable Securities current at the time of
receipt of such notice and (ii) that it will immediately notify the Company, at
any time when a Prospectus relating to the registration of such securities is
required to be delivered under the Securities Act, of the happening of any event
as a result of which information previously furnished by such Holder to the
Company in writing for inclusion in such Prospectus contains an untrue statement
of a material fact or omits to state any material fact required to be stated
therein or necessary to make the statements therein not misleading in light of
the circumstances under which they were made.
Section 7. Indemnification.
(a) In the event of any registration of any Holder's Registrable
Securities under the Securities Act pursuant to this Agreement, the Company
shall indemnify and hold harmless each such Holder (a "Selling Holder"), its
directors, officers and/or trustees, each underwriter and each controlling
Person of any Selling Holder, if any (an "Indemnified Party"), against any
losses, claims, damages or liabilities, joint or several (or actions in respect
thereof), including attorneys' fees and costs, to which such Indemnified Party
may be subject under the Securities Act, under any other statute or at common
law, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon (i) any untrue statement (or
alleged untrue statement) of any material fact contained in any Shelf
Registration Statement under which such securities were registered under the
Securities Act, any Prospectus contained therein, any other document used to
sell the securities (including an illegal prospectus) (collectively, the
"Selling Documents"), or any amendment or supplement thereto (an "Amended
Selling Document"); or (ii) any omission (or alleged omission) to state therein
a material fact required to be stated therein or necessary to make the
statements therein (in light of the circumstances in which they were made with
respect to any Prospectus) not misleading, and shall reimburse each such
Indemnified Party for any legal or other expenses reasonably incurred by such
Indemnified Party in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, however, that the Company shall
not be liable to any Indemnified Party in any such event to the extent that any
loss, claim, damage or liability arises out of or is based upon any untrue
statement or omission made in such Selling Document, Amended Selling Document,
or any other document, in reliance upon and in strict conformity with written
information furnished to the Company by such Indemnified Party specifically for
use therein; and provided further that the Company shall not be liable under
this paragraph (a) with respect to any misstatement or omission or alleged
misstatement or omission in any Selling Document to the extent that any such
loss, claim, damage or liability results from the fact that the Indemnified
Party sold securities to a Person to whom there was not sent or given, at or
prior to the written confirmation of such sale, a copy of any Amended Selling
Document if the Company had previously furnished copies thereof to such
Indemnified Party and if the misstatement or omission or alleged misstatement or
omission was corrected in
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the Amended Selling Document. The indemnity provided for herein shall remain in
full force and effect regardless of any investigation made by or on behalf of
such Indemnified Party.
(b) In the event of any registration of any of the Company's securities
or any Registrable Securities under the Securities Act, each Selling Holder
shall furnish to the Company in writing such information and affidavits as the
Company reasonably requests for use in connection with such Shelf Registration
Statement and agrees, severally and not jointly, to indemnify and hold harmless
the Company, its directors, each underwriter and each controlling Person of the
Company, if any, against any losses, claims, damages or liabilities, joint or
several (or actions in respect thereof), to which the Company, its directors,
such Selling Holder, underwriter or controlling Person may be subject under the
Securities Act or under any other statute or at common law, insofar as such
losses, claims, damages or liabilities, joint or several (or actions in respect
thereof), arise out of or are based upon (i) any untrue statement (or alleged
untrue statement) of any material fact contained in any Shelf Registration
Statement under which such securities were registered under the Securities Act,
any Selling Document or any Amended Selling Document, or (ii) any omission (or
alleged omission) to state therein a material fact required to be stated therein
or necessary to make the statements therein (in light of the circumstances in
which they were made with respect to any prospectus) not misleading, and shall
reimburse the Company, its directors, such underwriter and controlling Person
for any legal or other expenses reasonably incurred by such Persons in
connection with investigating or defending any such loss, claim, damage,
liability or action; in each case, to the extent, and only to the extent, that
each untrue statement or omission (or alleged untrue statement or omission) is
made in reliance upon and in strict conformity with written information
furnished to the Company by such Selling Holder.
(c) If the indemnification provided for in paragraph (a) or (b) above
is unavailable to an indemnified party in accordance with its terms in respect
of any losses, claims, damages or liabilities referred to therein, then the
obligations of each indemnitor thereunder shall be limited to such amount paid
or payable by such indemnified party as a result of such losses, claims, damages
or liabilities, in such proportion as is appropriate to reflect the relative
fault of such indemnitor on the one hand and of the indemnified parties on the
other hand in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. The relative fault of each indemnitor and of the indemnified
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 such
indemnitor, or by the indemnified parties, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 7 were determined by pro rata allocation
or by any other method
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of allocation which does not take into account the equitable considerations
referred to in the immediately preceding paragraph. The amount paid or payable
by an indemnified party as a result of the losses, claims, damages and
liabilities or actions in respect thereof referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expense reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7, no Selling Holder shall be
required to contribute any amount in excess of the amount by which the total
price at which the Registrable Securities sold by it exceeds the amount of any
damages which such person has otherwise been required to pay and has actually
paid by reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of a 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.
(d) Promptly after receipt by an indemnified party of notice of the
commencement of any action, such indemnified party shall, if a claim in respect
thereof is to be made against an indemnitor under paragraph (a) or (b) above, as
the case may be, notify the indemnitor in writing of the commencement thereof;
but the omission so to notify the indemnitor shall not relieve it from any
liability which it may have to any indemnified party under such subsection
unless the failure to provide such notice results in the forfeiture by the
indemnitor of substantial rights or defenses. In case any such action shall be
brought against any indemnified party, and it shall notify the indemnitor of the
commencement thereof, the indemnitor shall be entitled to participate therein
and, to the extent that it shall wish, to assume the defense thereof, with
counsel reasonably satisfactory to such indemnified party; provided, however,
that if the defendants in any such action include both the indemnified party and
the indemnitor and the indemnified party shall have reasonably concluded that
there may be legal defenses available to it and/or other indemnified parties
which are in addition to or in conflict with those available to the indemnitor,
the indemnified party or parties shall have the right to select separate counsel
to assert such legal defenses (in which case the indemnitor shall not have the
right to direct the defense of such action on behalf of the indemnified party or
parties). Upon the permitted assumption by the indemnitor of the defense of such
action, and approval by the indemnified party of counsel, the indemnitor shall
not be liable to such indemnified party under this Section 7 for any legal or
other expenses subsequently incurred by such indemnified party in connection
with the defense thereof (other than reasonable costs of investigation) unless
(i) the indemnified party shall have employed separate counsel in connection
with the assertion of legal defenses in accordance with the proviso to the next
preceding sentence, (ii) the indemnitor shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time, (iii) the indemnitor and its counsel do not actively and
vigorously pursue the defense of such action, or (iv) the indemnitor has
authorized the employment of counsel for the indemnified party at the expense of
the indemnitor. The indemnitor shall not be liable for any settlement of
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any action or proceeding effected without its written consent, which consent
shall not be unreasonably withheld.
Section 8. Miscellaneous.
(a) Governing Law. This Agreement shall be governed by and construed
under the internal substantive laws of the State of Delaware.
(b) Successors and Assigns. The provisions hereof shall inure to the
benefit of, and be binding upon, the parties and their respective successors,
assigns, heirs, executors and administrators. The rights and obligations of any
Investor hereunder may be assigned by such Investor to any Person acquiring
Registrable Securities from the Investor contemporaneously with such assignment,
provided that the rights so assumed shall apply only to the Registrable
Securities so acquired. The rights and obligations of the Company hereunder may
not be assigned by it without the prior written consent of the Investors.
(c) Entire Agreement. This Agreement, the Purchase Agreement and, with
respect to the Senior Notes, the Indenture constitute the full and entire
understanding and agreement among the parties with regard to the subject matter
hereof and no party shall be liable or bound to any other party in any manner by
any representations, warranties, covenants or agreements except as specifically
set forth herein or therein. Nothing in this Agreement, express or implied, is
intended to confer upon any party, other than the parties hereto and their
respective successors and assigns, any rights, remedies, obligations or
liabilities under or by reason of this Agreement, except as expressly provided
herein.
(d) Separability. Any invalidity, illegality or limitation of the
enforceability of any one or more of the provisions of this Agreement, or any
part thereof, shall in no way affect or impair the validity, legality or
enforceability of the other provisions of this Agreement. In case any provision
of this Agreement shall be invalid, illegal or unenforceable, it shall, to the
extent practicable, be modified so as to make it valid, legal and enforceable
and to retain as nearly as practicable the intent of the parties, and the
validity, legality and enforceability of the remaining provisions shall not in
any way be affected or impaired thereby.
(e) Amendment and Waiver. Any provision of this Agreement may be
amended and the observance of any provision of this Agreement may be waived
(either generally or in a particular instance, either retroactively or
prospectively, and either for a specified period of time or indefinitely), with
the written consent of the Company and the holders of not less than two thirds
of the both the aggregate principal amount of the Senior Notes and the shares of
Common Stock issued pursuant to the Purchase Agreement; provided, however, that
no such amendment or waiver shall reduce the aforesaid percentage of aggregate
principal amount of the Senior Notes or shares of Common Stock issued pursuant
to the Purchase Agreement which are required to consent to any waiver or
supplemental agreement unless the consent of the holders of all outstanding
Registrable Securities are
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obtained. Any amendment or waiver effected in accordance with this paragraph
shall be binding upon the Company and each Holder under this Agreement. Upon the
effectuation of each such amendment or waiver, the Company shall promptly give
written notice thereof to the Holders who have not previously consented thereto
in writing.
(f) Delays or Omissions. No delay or omission to exercise any right,
power or remedy accruing to any Holder upon any breach, default or noncompliance
of the Company under this Agreement shall impair any such right, power or
remedy, nor shall it be construed to be a waiver of any such breach, default or
noncompliance, or any acquiescence therein, or of any similar breach, default or
noncompliance thereafter occurring. It is further agreed that any waiver,
permit, consent or approval of any kind or character on the Holders' part of any
breach, default or noncompliance under this Agreement or any waiver on the
Holders' part of any provisions or conditions of this Agreement must be in
writing and shall be effective only to the extent specifically set forth in such
writing, and that all remedies afforded to the Holders under this Agreement
shall be cumulative and not alternative.
(g) Notices, etc. All notices, demands and other communications
provided for or permitted hereunder shall be made in writing by hand-delivery,
registered first-class mail, telex, telecopier, or air courier guaranteeing
overnight delivery:
(i) if to any Holder, initially at the address set forth below
its name on the Holder's signature page to this Agreement, and
thereafter at such other address, notice of which is given in
accordance with this Section 8(g); and
(ii) if to the Company, initially at 0000 XX 00xx Xxxxxx,
Xxxxxxxx Xxxx, Xxxxxxxx 00000-0000, Attention: Chief Executive Officer,
and thereafter at such other address notice of which is given in
accordance with this Section 8(g).
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five Business
Days after being sent by certified mail, return receipt requested, if mailed;
when answered back, if telexed; when receipt is acknowledged, if telecopied; and
on the next Business Day if timely delivered to an air courier guaranteeing
overnight delivery.
(h) Titles and Subtitles. The titles of the sections and subsections of
this Agreement are for convenience of reference only and are not to be
considered in construing this Agreement.
(i) Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
LOCAL FINANCIAL CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxx
----------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Chairman
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Investor Signature Page to Registration Rights Agreement
--------------------------
Name
By:
--------------------------
Name:
Title:
Address:
-----------------
--------------------------
--------------------------
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