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EXHIBIT 10
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11% SENIOR NOTES DUE 2003
REGISTRATION RIGHTS AGREEMENT
dated January 25, 1996
by and among
KCS ENERGY, INC.,
ENERCORP GAS MARKETING, INC.,
KCS RESOURCES, INC.,
KCS MICHIGAN RESOURCES, INC.,
KCS PIPELINE SYSTEMS, INC.,
KCS ENERGY MARKETING, INC.,
KCS POWER MARKETING, INC.,
KCS ENERGY RISK MANAGEMENT, INC.,
NATIONAL ENERDRILL CORPORATION,
and PROLIQ, INC.
and
XXXXX XXXXXX INC.,
XXXXXXXXX, LUFKIN & XXXXXXXX SECURITIES CORPORATION,
NOMURA SECURITIES INTERNATIONAL, INC.
and
PAINEWEBBER INCORPORATED
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This Registration Rights Agreement is made and entered into this 25th
day of January, 1996, by and among KCS Energy, Inc., a Delaware corporation
(the "Company"), Enercorp Gas Marketing, Inc., a Delaware corporation, KCS
Resources, Inc., a Delaware corporation, KCS Michigan Resources, Inc., a
Delaware corporation, KCS Pipeline Systems, Inc., a Delaware corporation, KCS
Energy Marketing, Inc., a New Jersey corporation, KCS Power Marketing, Inc., a
Delaware corporation, KCS Energy Risk Management, Inc., a Delaware corporation,
National Enerdrill Corporation, a New Jersey corporation, Proliq, Inc., a New
Jersey corporation (the "Guarantors" and, together with the Company, the
"Issuers"), Xxxxx Xxxxxx Inc. ("Xxxxx Xxxxxx"), Xxxxxxxxx, Xxxxxx & Xxxxxxxx
Securities Corporation ("DLJ"), Nomura Securities International, Inc.
("Nomura") and PaineWebber Incorporated ("PaineWebber" and, together with Xxxxx
Xxxxxx, DLJ and Nomura, the "Initial Purchasers").
This Agreement is made pursuant to the Purchase Agreement, dated
January 19, 1996, among the Company, the Guarantors and Initial Purchasers (the
"Purchase Agreement"). In order to induce the Initial Purchasers to enter into
the Purchase Agreement, the Issuers have agreed to provide the registration
rights provided for in this Agreement to the Initial Purchasers and their
respective direct and indirect transferees. The execution and delivery of this
Agreement is a condition to the closing of the transactions contemplated by the
Purchase Agreement.
The parties hereby agree as follows:
1. Definitions
As used in this Agreement, the following terms shall have the
following meanings:
Additional Interest: As defined in Section 4(a) hereof.
Advice: As defined in the last paragraph of Section 5 hereof.
Affiliate: With respect to any specified person, "Affiliate"
shall mean any other person directly or indirectly controlling or controlled by
or under direct or indirect common control with such specified person. For the
purposes of this definition, "control," when used with respect to any 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 "affiliated," "controlling" and "controlled" have
meanings correlative to the foregoing.
Agreement: This Registration Rights Agreement, as the same
may be amended, supplemented or modified from time to time in accordance with
the terms hereof.
Business Day: Any day except a Saturday, a Sunday or a day on
which banking institutions in New York, New York generally are required or
authorized by law or other government action to be closed.
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Company: As defined in the preamble hereof.
Consummate or consummate: When used to qualify the term
"Exchange Offer" shall mean validly and lawfully to issue and deliver the
Exchange Notes pursuant to the Exchange Offer for all Notes validly tendered
and not validly withdrawn pursuant thereto in accordance with the terms of this
Agreement.
Consummation Date: The date that is 30 Business Days
immediately following the date that the Exchange Registration Statement shall
have been declared effective by the SEC.
Effectiveness Period: As defined in Section 3(a) hereof.
Exchange Act: The Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated by the SEC pursuant thereto.
Exchange Date: As defined in Section 2(d) hereof.
Exchange Notes: The 11% Senior Notes due 2003, Series B, of
the Company, guaranteed on a senior unsecured basis by each of the Guarantors,
that are identical to the Notes in all material respects, except that the
provisions regarding restrictions on transfer shall be modified, as
appropriate, and the issuance thereof pursuant to the Exchange Offer shall have
been registered pursuant to an effective Registration Statement in compliance
with the Securities Act.
Exchange Offer: An offer to issue, in exchange for any and
all of the Notes, a like aggregate principal amount of Exchange Notes, which
offer shall be made by the Company pursuant to Section 2 hereof.
Exchange Registration Statement: As defined in Section 2(a)
hereof.
Guarantors: As defined in the preamble hereof.
Indemnified Person: As defined in Section 7(a) hereof.
Indenture: The Indenture, dated as of January 15, 1996, among
the Issuers and Fleet National Bank of Connecticut, as trustee thereunder,
pursuant to which the Notes are issued, as amended or supplemented from time to
time in accordance with the terms thereof.
Initial Purchasers: As defined in the preamble hereof.
Issue Date: As defined in Section 2(a).
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Issuers: As defined in the preamble hereof.
Notes: The 11% Senior Notes due 2003, Series A, of the
Company, guaranteed on a senior unsecured basis by each of the Guarantors,
issued pursuant to the Indenture.
Participating Broker-Dealer: As defined in Section 2(e)
hereof.
Private Exchange: As defined in Section 2(c) hereof.
Private Exchange Notes: As defined in Section 2(c) hereof.
Prospectus: The prospectus included in any Registration
Statement (including, without limitation, a prospectus that discloses
information previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 430A promulgated pursuant to the
Securities Act), as amended or supplemented by any prospectus supplement, with
respect to the terms of the offering of any portion of the Notes, Exchange
Notes or Private Exchange Notes covered by such Registration Statement, and all
other amendments and supplements to any such prospectus, including
post-effective amendments, and all material incorporated by reference or deemed
to be incorporated by reference, if any, in such prospectus.
Registration Default: As defined in Section 4(a) hereof.
Registration Statement: Any registration statement of the
Company and the Guarantors that covers any of the Notes, Exchange Notes or
Private Exchange Notes pursuant to the provisions of this Agreement, including
the Prospectus, amendments and supplements to such registration statement or
Prospectus, including pre- and post-effective amendments, all exhibits thereto,
and all material incorporated by reference or deemed to be incorporated by
reference, if any, in such registration statement.
Rule 144: Rule 144 promulgated by the SEC pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
Rule 144A: Rule 144A promulgated by the SEC pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
Rule 158: Rule 158 promulgated by the SEC pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
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Rule 174: Rule 174 promulgated by the SEC pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
Rule 415: Rule 415 promulgated by the SEC pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
Rule 424: Rule 424 promulgated by the SEC pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
SEC: The Securities and Exchange Commission.
Securities Act: The Securities Act of 1933, as amended, and
the rules and regulations promulgated by the SEC thereunder.
Shelf Registration: As defined in Section 3 hereof.
Shelf Registration Statement: As defined in Section 3 hereof.
Special Counsel: Xxxxxx & Xxxxxx L.L.P., special counsel to
the holders of Transfer Restricted Securities, or such other counsel as shall
be agreed upon by the Issuers and holders of a majority in aggregate principal
amount of Transfer Restricted Securities, the expenses of which holders of
Transfer Restricted Securities will be reimbursed by the Issuers pursuant to
Section 6.
TIA: The Trust Indenture Act of 1939, as amended.
Transfer Restricted Securities: The Notes, upon original
issuance thereof and at all times subsequent thereto, each Exchange Note as to
which Section 3(a)(ii) hereof is applicable upon original issuance and at all
times subsequent thereto and each Private Exchange Note upon original issuance
thereof and at all times subsequent thereto, until in the case of any such
Note, Exchange Note or Private Exchange Note, as the case may be, the earliest
to occur of (i) the date on which any such Note has been exchanged by a person
other than a Participating Broker-Dealer for an Exchange Note (other than with
respect to an Exchange Note as to which Section 3(a)(ii) hereof applies)
pursuant to the Exchange Offer, (ii) with respect to Exchange Notes received by
Participating Broker-Dealers in the Exchange Offer, the earlier of (x) the date
on which such Exchange Note has been sold by such Participating Broker-Dealer
by means of the Prospectus contained in the Exchange Registration Statement and
(y) the date on which the Exchange Registration Statement has been effective
under the Securities Act for a period of 6 months after the Consummation Date,
(iii) a Shelf
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Registration Statement covering such Note, Exchange Note or Private Exchange
Note has been declared effective by the SEC and such Note, Exchange Note or
Private Exchange Note, as the case may be, has been disposed of in accordance
with such effective Shelf Registration Statement, (iv) the date on which such
Note, Exchange Note or Private Exchange Note, as the case may be, is
distributed to the public pursuant to Rule 144 (or any similar provisions then
in effect) or is saleable pursuant to Rule 144(k) promulgated by the SEC
pursuant to the Securities Act or (v) the date on which such Note, Exchange
Note or Private Exchange Note, as the case may be, ceases to be outstanding for
purposes of the Indenture or any other indenture under which such Exchange Note
or Private Exchange Note was issued.
Trustee: The trustee under the Indenture.
Underwritten Registration or Underwritten Offering: A
registration in connection with which securities are sold to an underwriter for
reoffering to the public pursuant to an effective Registration Statement.
2. Exchange Offer
(a) To the extent not prohibited by any applicable law or
applicable interpretation of the staff of the SEC, the Issuers shall (A)
prepare and, on or prior to 90 days after the date of original issuance of the
Notes (the "Issue Date"), file with the SEC a Registration Statement under the
Securities Act with respect to an offer by the Company to the holders of the
Notes to issue and deliver to such holders, in exchange for Notes, a like
principal amount of Exchange Notes, (B) use their commercially reasonable best
efforts to cause the Registration Statement relating to the Exchange Offer to
be declared effective by the SEC under the Securities Act on or prior to 120
days after the Issue Date, and (C) commence the Exchange Offer and use
commercially reasonable best efforts to issue, on or prior to the Consummation
Date, the Exchange Notes. The offer and sale of the Exchange Notes pursuant to
the Exchange Offer shall be registered pursuant to the Securities Act on the
appropriate form (the "Exchange Registration Statement") and duly registered or
qualified under all applicable state securities or Blue Sky laws and will
comply with all applicable tender offer rules and regulations under the
Exchange Act and state securities or Blue Sky laws. The Exchange Offer shall
not be subject to any condition, other than that the Exchange Offer does not
violate any applicable law or interpretation of the staff of the SEC. Upon
consummation of the Exchange Offer in accordance with this Section 2, the
Issuers shall have no further registration obligations other than with respect
to (i) Private Exchange Notes, (ii) Exchange Notes held by Participating
Broker-Dealers and (iii) Notes or Exchange Notes as to which Section 3(a)(ii)
hereof applies. No securities shall be included in the Exchange Registration
Statement other than the Exchange Notes.
(b) The Issuers may require each holder of Notes as a
condition to its participation in the Exchange Offer to represent to the
Issuers and their counsel in writing (which may be
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contained in the applicable letter of transmittal) that at the time of the
consummation of the Exchange Offer (i) any Exchange Notes received by such
holder will be acquired in the ordinary course of its business, (ii) such
holder will have no arrangement or understanding with any person to participate
in the distribution (within the meaning of the Securities Act) of the Exchange
Notes and (iii) such holder is not an Affiliate of an Issuer, or if it is an
Affiliate of an Issuer, it will comply with the registration and prospectus
delivery requirements of the Securities Act, to the extent applicable.
(c) If, prior to consummation of the Exchange Offer, any of
the Initial Purchasers holds any Notes acquired by it and having, or which are
reasonably likely to be determined to have, the status of an unsold allotment
in the initial distribution, or any other holder of Notes is not entitled to
participate in the Exchange Offer, the Company upon the request of an Initial
Purchaser or any such holder shall, simultaneously with the delivery of the
Exchange Notes in the Exchange Offer, issue and deliver to such Initial
Purchaser and any such holder, in exchange (the "Private Exchange") for such
Notes held by such Initial Purchaser and any such holder, a like principal
amount of debt securities of the Company, guaranteed by each of the Guarantors
on a senior unsecured basis, that are identical in all material respects to the
Exchange Notes except as to restrictions on transferability under applicable
securities laws (the "Private Exchange Notes") (and which are issued pursuant
to the same indenture as the Exchange Notes); provided, however, that the
Issuers shall not be required to effect a Private Exchange if in the written
opinion of counsel for the Issuers (a copy of which is delivered to the Initial
Purchasers and any holder of Notes whose request is the subject of such
opinion) such Private Exchange cannot be effected without registration under
the Securities Act. The Private Exchange Notes shall bear the same CUSIP
number as the Exchange Notes.
(d) Unless the Exchange Offer would not be permitted by any
applicable law or interpretation of the staff of the SEC, the Company shall
mail the Exchange Offer Prospectus and appropriate accompanying documents,
including appropriate letters of transmittal, to each holder of Notes
providing, in addition to such other disclosures as are required by applicable
law:
(i) that the Exchange Offer is being made pursuant to this
Agreement and that all Notes validly tendered will be accepted for
exchange;
(ii) the date of acceptance for exchange (the "Exchange
Date"), which date shall in no event be later than the Consummation
Date (unless otherwise required by applicable law);
(iii) that holders of Notes electing to have a Note exchanged
pursuant to the Exchange Offer will be required to surrender such
Note, together with the enclosed letters of transmittal, to the
institution and at the address (located in New York, New York)
specified in the notice prior to the close of business on the Exchange
Date; and
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(iv) that holders of Notes that do not tender all such
securities pursuant to the Exchange Offer may no longer have any
registration rights hereunder with respect to Notes not tendered.
As soon as practicable after the Exchange Date, the Company
shall:
(i) accept for exchange all Notes validly tendered and not
validly withdrawn pursuant to the Exchange Offer or the Private
Exchange; and
(ii) deliver, or cause to be delivered, to the Trustee for
cancellation all Notes so accepted for exchange by the Company, and
issue, cause the Trustee under the Indenture (or the indenture
pursuant to which the Exchange Notes are issued) to authenticate, and
mail to each holder of Notes, Exchange Notes equal in principal amount
to the principal amount of the Notes surrendered by such holder.
(e) The Issuers and each Initial Purchaser acknowledge that
the staff of the SEC has taken the position that any broker-dealer that owns
Exchange Notes that were received by such broker-dealer for its own account in
the Exchange Offer (a "Participating Broker-Dealer") may be deemed to be an
"underwriter" within the meaning of the Securities Act and must deliver a
prospectus meeting the requirements of the Securities Act in connection with
any resale of such Exchange Notes (other than a resale of an unsold allotment
resulting from the original offering of the Notes).
The Issuers and each Initial Purchaser also acknowledge that
it is the SEC staff's position that if the Prospectus contained in the Exchange
Registration Statement includes a plan of distribution containing a statement
to the above effect and the means by which Participating Broker-Dealers may
resell the Exchange Notes, without naming the Participating Broker Dealers or
specifying the amount of Exchange Notes owned by them, such Prospectus may be
delivered by Participating Broker-Dealers to satisfy their prospectus delivery
obligations under the Securities Act in connection with resales of Exchange
Notes for their own accounts, so long as the Prospectus otherwise meets the
requirements of the Securities Act.
In light of the foregoing, if requested by a Participating
Broker-Dealer, the Issuers agree (x) to use their commercially reasonable best
efforts to keep the Exchange Registration Statement continuously effective for
a period of up to 6 months or such earlier date as each Participating
Broker-Dealer shall have notified the Company in writing that such
Participating Broker-Dealer has resold all Exchange Notes acquired in the
Exchange Offer, (y) to comply with the provisions of Section 5 of this
Agreement, as they relate to the Exchange Offer and the Exchange Registration
Statement, and (z) to deliver to such Participating Broker-Dealer a "cold
comfort" letter of the independent public accountants of the Issuers and a
legal opinion as to matters reasonably
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requested by such Participating Broker-Dealer relating to the Exchange
Registration Statement and the related Prospectus and any amendments or
supplements thereto.
(f) The Initial Purchasers shall have no liability to any
Participating Broker-Dealer with respect to any request made pursuant to
Section 2(e).
(g) Accrued but unpaid interest on any Note that is exchanged
for an Exchange Note or a Private Exchange Note pursuant to this Agreement
shall be paid on or before the first interest payment date on the Exchange
Notes and the Private Exchange Notes, as the case may be.
(h) The Exchange Notes and the Private 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 shall provide that the
Exchange Notes shall not be subject to the transfer restrictions set forth in
the Indenture, except in any case where an Exchange Note constitutes a Transfer
Restricted Security. The Indenture or such indenture shall provide that the
Exchange Notes, the Private Exchange Notes and the Notes shall vote and consent
together on all matters as one class and that neither the Exchange Notes, the
Private Exchange Notes nor the Notes will have the right to vote or consent as
a separate class on any matter.
3. Shelf Registration
(a) If (i) the Company is not permitted to file the Exchange
Offer Registration Statement or to consummate the Exchange Offer because the
Exchange Offer is not permitted by any applicable law or applicable
interpretation of the staff of the SEC or (ii) any holder of a Note notifies
the Company on or prior to the Exchange Date that (A) due to a change in law or
policy it is not entitled to participate in the Exchange Offer, (B) due to a
change in law or policy it may not resell the Exchange Notes acquired by it in
the Exchange Offer to the public without delivering a prospectus and the
Prospectus contained in the Exchange Registration Statement is not appropriate
or available for such resales by such holder or (C) it is a broker-dealer that
owns Notes (including any Initial Purchaser that holds Notes as part of an
unsold allotment from the original offering of the Notes) acquired directly
from an Issuer or an Affiliate of an Issuer or (iii) any holder of Private
Exchange Notes so requests within 120 days after the consummation of the
Private Exchange (each such event referred to in clauses (i) through (iii), a
"Shelf Filing Event"), the Issuers shall cause to be filed with the SEC
pursuant to Rule 415 a shelf registration statement (the "Shelf Registration
Statement") prior to the later of (x) 90 days after the Issue Date and (y) 30
days after the occurrence of such Shelf Filing Event, relating to all Transfer
Restricted Securities (the "Shelf Registration") the holders of which have
provided the information required pursuant to Section 3(b) hereof, and shall
use their commercially reasonable best efforts to have the Shelf Registration
Statement declared effective by the SEC on or prior to 90 days after the
occurrence of such Shelf Filing Event, provided that if the Company has not
consummated the Exchange Offer within 180 days of the Issue Date,
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then the Issuers shall cause the Shelf Registration Statement to be filed with
the SEC on or prior to the 181st day after the Issue Date and shall use their
commercially reasonable best efforts to have the Shelf Registration Statement
declared effective by the SEC within 60 days of the date of filing thereof. In
such circumstances, the Issuers shall use their commercially reasonable best
efforts to keep the Shelf Registration Statement continuously effective under
the Securities Act, until (A) the third anniversary of the Issue Date (subject
to extension pursuant to the last paragraph of Section 5 hereof) or (B) if
sooner, the date immediately following the date that all Transfer Restricted
Securities covered by the Shelf Registration Statement have been sold pursuant
thereto (the "Effectiveness Period"); provided, however, that the Effectiveness
Period shall be extended to the extent required to permit dealers to comply
with the applicable prospectus delivery requirements of Rule 174 and as
otherwise provided herein.
(b) No holder of Transfer Restricted Securities may include
any of its Transfer Restricted Securities in any Shelf Registration Statement
pursuant to this Agreement unless and until such holder furnishes to the
Company in writing, within 20 days after receipt of a request therefor, such
information as the Company may reasonably request for use in connection with
any Shelf Registration Statement or Prospectus or preliminary prospectus
included therein. No holder of Transfer Restricted Securities shall be entitled
to Additional Interest pursuant to Section 4 hereof unless and until such
holder shall have provided all such reasonably requested information. Each
holder of Transfer Restricted Securities as to which any Shelf Registration
Statement is being effected agrees to furnish promptly to the Company all
information required to be disclosed in order to make the information
previously furnished to the Company by such holder not materially misleading.
4. Additional Interest
(a) The parties hereto agree that the holders of Transfer
Restricted Securities will suffer damages if the Issuers fail to fulfill their
obligations pursuant to Section 2 or Section 3, as applicable, and that it
would not be feasible to ascertain the extent of such damages. Accordingly, in
the event that (i) the applicable Registration Statement is not filed with the
SEC on or prior to the date specified herein for such filing, (ii) the
applicable Registration Statement has not been declared effective by the SEC on
or prior to the date specified herein for such effectiveness after such
obligation arises, (iii) if the Exchange Offer is required to be Consummated
hereunder, the Company has not exchanged Exchange Notes for all Notes validly
tendered and not validly withdrawn in accordance with the terms of the Exchange
Offer by the Consummation Date or (iv) the applicable Registration Statement is
filed and declared effective but shall thereafter cease to be effective without
being succeeded immediately by any additional Registration Statement covering
the Notes, the Exchange Notes or the Private Exchange Notes, as the case may
be, which has been filed and declared effective (each such event referred to in
clauses (i) through (iv), a "Registration Default"), then the interest rate on
Transfer Restricted Securities will increase ("Additional Interest"), with
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respect to the first 90-day period immediately following the occurrence of such
Registration Default, by 0.50% per annum and will increase by an additional
0.50% per annum with respect to each subsequent 90-day period until all
Registration Defaults have been cured, up to a maximum amount of 2% per annum
with respect to all Registration Defaults. Following the cure of a Registration
Default, the accrual of Additional Interest with respect to such Registration
Default will cease and upon the cure of all Registration Defaults the interest
rate will revert to the original rate.
(b) The Company shall notify the Trustee and paying agent
under the Indenture (or the trustee and paying agent under such other indenture
under which the Transfer Restricted Securities are issued) immediately upon the
happening of each and every Registration Default. The Company shall pay the
Additional Interest due on the Transfer Restricted Securities by depositing
with the paying agent (which shall not be the Company for these purposes) for
the Transfer Restricted Securities, in trust, for the benefit of the holders
thereof, prior to 11:00 A.M. on the next interest payment date specified by the
Indenture (or such other indenture), sums sufficient to pay the Additional
Interest then due. The Additional Interest due shall be payable on each
interest payment date specified by the Indenture (or such other indenture) to
the record holder entitled to receive the interest payment to be made on such
date. Each obligation to pay Additional Interest shall be deemed to accrue from
and including the applicable Registration Default.
(c) The parties hereto agree that the Additional Interest
provided for in this Section 4 constitutes a reasonable estimate of the damages
that will be suffered by holders of Transfer Restricted Securities by reason of
the happening of any Registration Default.
5. Registration Procedures
In connection with the Issuers' registration obligations
hereunder, the Issuers shall effect such registrations on the appropriate form
available for the sale of the Notes, the Exchange Notes or Private Exchange
Notes, as applicable, to (i) in the case of the Exchange Offer, permit the
exchange of Exchange Notes for Notes in the Exchange Offer and, if applicable,
resales of Exchange Notes by Participating Broker-Dealers and (ii) in the case
of a Shelf Registration, permit the sale of the applicable Transfer Restricted
Securities in accordance with the method or methods of disposition thereof
specified by the holders of such Transfer Restricted Securities, and pursuant
thereto the Issuers shall as expeditiously as practicable:
(a) In the case of a Shelf Registration, a reasonable period
of time prior to the initial filing of a Shelf Registration Statement
or Prospectus and a reasonable period of time prior to the filing of
any amendment or supplement thereto (including any document that would
be incorporated or deemed to be incorporated therein by reference),
furnish to the holders of the Transfer Restricted Securities included
in such Shelf Registration Statement, their Special
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Counsel and the managing underwriters, if any, copies of all such
documents proposed to be filed, which documents (other than those
incorporated or deemed to be incorporated by reference) will be
subject to the review of such holders, their Special Counsel and such
underwriters, if any, and cause the officers and directors of the
Issuers, counsel to the Issuers and independent certified public
accountants to the Issuers to respond to such reasonable inquiries as
shall be necessary, in the opinion of respective counsel to such
holders and such underwriters, to conduct a reasonable investigation
within the meaning of the Securities Act; provided, however, that the
foregoing inspection and information gathering shall be coordinated on
behalf of the Initial Purchasers by Xxxxx Xxxxxx, and on behalf of any
other persons by one counsel designated by and on behalf of such other
persons; and provided, further, that the Issuers shall not be deemed
to have kept a Shelf Registration Statement effective during the
applicable period if any of them voluntarily takes or fails to take
any reasonable action that results in holders of the Transfer
Restricted Securities covered thereby not being able to sell such
Transfer Restricted Securities pursuant to Federal securities laws
during that period (and the time period during which such Shelf
Registration Statement is required to remain effective hereunder shall
be extended by the number of days during which such holders of
Transfer Restricted Securities are not able to sell such Transfer
Restricted Securities). The Issuers shall not file any such Shelf
Registration Statement or related Prospectus or any amendments or
supplements thereto which the holders of a majority in aggregate
principal amount of the Transfer Restricted Securities included in
such Shelf Registration Statement shall reasonably object on a timely
basis;
(b) Prepare and file with the SEC such amendments, including
post-effective amendments, to each Registration Statement as may be
necessary to keep such Registration Statement continuously effective
for the applicable time period required hereunder; cause the related
Prospectus to be supplemented by any required Prospectus supplement,
and as so supplemented to be filed pursuant to Rule 424; and comply
with the provisions of the Securities Act and the Exchange Act with
respect to the disposition of all securities covered by such
Registration Statement during such period in accordance with the
intended methods of disposition by the sellers thereof set forth in
such Registration Statement as so amended or in such Prospectus as so
supplemented;
(c) Notify the holders of Transfer Restricted Securities to
be sold or, in the case of an Exchange Offer, tendered for, their
Special Counsel and the managing underwriters, if any, promptly, and
(if requested by any such person), confirm such notice in writing,
(i)(A) when a Prospectus or any Prospectus supplement or
post-effective amendment is proposed to be filed, and (B) with respect
to a Registration Statement or any post-effective amendment, when the
same has become effective, (ii) of any request by the SEC or any other
Federal or state governmental authority for amendments or supplements
to a Registration Statement or related Prospectus or for additional
information, (iii) of the issuance by the
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SEC, any state securities commission, any other governmental agency or
any court of any stop order, order or injunction suspending or
enjoining the use of a Prospectus or the effectiveness of a
Registration Statement or the initiation of any proceedings for that
purpose, (iv) of the receipt by the Company of any notification with
respect to the suspension of the qualification or exemption from
qualification of any of the Notes, Exchange Notes or Private Exchange
Notes for sale in any jurisdiction, or the initiation or threatening
of any proceeding for such purpose, and (v) of the happening of any
event or information becoming known that makes any statement made in a
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 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 a
Prospectus, it will not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(d) Use their commercially reasonable best efforts to avoid
the issuance of or, if issued, obtain the withdrawal of any order
enjoining or suspending the use of a Prospectus or the effectiveness
of a Registration Statement or the lifting of any suspension of the
qualification (or exemption from qualification) of any of the Notes,
Exchange Notes or Private Exchange Notes for sale in any jurisdiction,
at the earliest practicable moment;
(e) If a Shelf Registration Statement is filed pursuant to
Section 3 hereof and if requested by the managing underwriters, if
any, or the holders of a majority in aggregate principal amount of the
Transfer Restricted Securities being sold pursuant to such Shelf
Registration Statement, (i) as soon as practicable incorporate in a
Prospectus supplement or post-effective amendment such information as
the managing underwriters, if any, and such holders reasonably believe
should be included therein, and (ii) make all required filings of such
Prospectus supplement or such post-effective amendment under the
Securities Act as soon as practicable after the Company has received
notification of the matters to be incorporated in such Prospectus
supplement or post-effective amendment; provided, however, that the
Issuers shall not be required to take any action pursuant to this
Section 5(e) that would, in the opinion of counsel for the Issuers,
violate applicable law;
(f) Upon written request to the Company, furnish to each
holder of Notes, Exchange Notes or Private Exchange Notes to be
exchanged or sold pursuant to a Registration Statement, their Special
Counsel and each managing underwriter, if any, without charge, at
least one conformed copy of such Registration Statement and each
amendment thereto, including financial statements and schedules, all
documents incorporated or deemed to be
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incorporated therein by reference, and all exhibits to the extent
requested (including those previously furnished or incorporated by
reference) as soon as practicable after the filing of such documents
with the SEC;
(g) Deliver to each holder of Notes, Exchange Notes or
Private Exchange Notes to be exchanged or sold pursuant to a
Registration Statement, their Special Counsel, and the underwriters,
if any, without charge, as many copies of the Prospectus (including
each form of prospectus) and each amendment or supplement thereto as
such persons reasonably request; and, subject to the provisions of the
last paragraph of this Section 5, the Issuers hereby consent to the
use of such Prospectus and each amendment or supplement thereto by
each of the selling holders of Transfer Restricted Securities and the
underwriters, if any, in connection with the offering and sale of the
Transfer Restricted Securities covered by such Prospectus and any
amendment or supplement thereto;
(h) Prior to any public offering of Notes, Exchange Notes or
Private Exchange Notes, use their commercially reasonable best efforts
to register or qualify or cooperate with the holders of Notes,
Exchange Notes or Private Exchange Notes to be sold or tendered for,
the underwriters, if any, and their respective counsel in connection
with the registration or qualification (or exemption from such
registration or qualification) of such Notes, Exchange Notes or
Private Exchange Notes for offer and sale under the securities or Blue
Sky laws of such jurisdictions within the United States as any such
holder or underwriter reasonably requests in writing; keep each such
registration or qualification (or exemption therefrom) effective
during the period such Registration Statement is required to be kept
effective hereunder and do any and all other acts or things necessary
or advisable to enable the disposition in such jurisdictions of the
Notes, Exchange Notes or Private Exchange Notes covered by the
applicable Registration Statement; provided, however, that the Issuers
shall not be required to (i) qualify generally to do business in any
jurisdiction where they are not then so qualified or (ii) take any
action which would subject them to general service of process or to
taxation in any jurisdiction where they are not so subject;
(i) In connection with any sale or transfer of Transfer
Restricted Securities that will result in such securities no longer
being Transfer Restricted Securities, cooperate with the holders
thereof and the managing underwriters, if any, to facilitate the
timely preparation and delivery of certificates representing Transfer
Restricted Securities to be sold, which certificates shall not bear
any restrictive legends and shall be in a form eligible for deposit
with The Depository Trust Company and to enable such Transfer
Restricted Securities to be in such authorized denominations and
registered in such names as the managing underwriters, if any, or such
holders may request at least two Business Days prior to any sale of
Transfer Restricted Securities;
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(j) Upon the occurrence of any event contemplated by Section
5(c)(v), as promptly as practicable, prepare a supplement or
amendment, including, if appropriate, a post-effective amendment, to
each Registration Statement or a supplement to the related Prospectus
or any document incorporated or deemed to be incorporated therein by
reference, and file any other required document so that, as thereafter
delivered, 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 light of the
circumstances under which they were made, not misleading;
(k) Prior to the effective date of the Exchange Registration
Statement, to provide a CUSIP number for the Exchange Notes (and
Private Exchange Notes if applicable);
(l) If a Shelf Registration Statement is filed pursuant to
Section 3 hereof, enter into such agreements (including an
underwriting agreement in form, scope and substance as is customary in
underwritten offerings) and take all such other reasonable actions in
connection therewith (including those reasonably requested by the
managing underwriters, if any, or the holders of a majority in
aggregate principal amount of the Transfer Restricted Securities being
sold) in order to expedite or facilitate the disposition of such
Transfer Restricted Securities, and, whether or not an underwriting
agreement is entered into and whether or not the registration is an
underwritten registration, (i) make such representations and
warranties to the holders of such Transfer Restricted Securities and
the underwriters, if any, with respect to the business of the Company
and its subsidiaries (including with respect to businesses or assets
acquired or to be acquired by any of them), and the Shelf 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, and confirm the same if and when requested;
(ii) obtain opinions of counsel to the Issuers and updates thereof
(which counsel and opinions (in form, scope and substance) shall be
reasonably satisfactory to the managing underwriters, if any, and
Special Counsel to the holders of the Transfer Restricted Securities
being sold), addressed to each selling holder of Transfer Restricted
Securities and each of the underwriters, if any, covering the matters
customarily covered in opinions requested in underwritten offerings
and such other matters as may be reasonably requested by such Special
Counsel and underwriters; (iii) use their commercially reasonable best
efforts to obtain customary "cold comfort" letters and updates thereof
from the independent certified public accountants of the Company (and,
if necessary, any other independent certified public accountants of
any subsidiary of the Company or of any business acquired by the
Company for which financial statements and financial data is, or is
required to be, included in the Shelf Registration Statement),
addressed (where reasonably possible) to each selling holder of
Transfer Restricted Securities and each of the underwriters, if any,
such letters to be in customary form and covering matters of the type
customarily covered in "cold comfort"
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letters in connection with underwritten offerings; (iv) if an
underwriting agreement is entered into, the same shall contain
indemnification provisions and procedures no less favorable to the
selling holders and the underwriters, if any, than those set forth in
Section 7 hereof (or such other provisions and procedures acceptable
to holders of a majority in aggregate principal amount of Transfer
Restricted Securities covered by such Shelf Registration Statement and
the managing underwriters, if any); and (v) deliver such documents and
certificates as may be reasonably requested by the holders of a
majority in aggregate principal amount of the Transfer Restricted
Securities being sold, their Special Counsel and the managing
underwriters, if any, to evidence the continued validity of the
representations and warranties made pursuant to clause (i) above and
to evidence compliance with any customary conditions contained in the
underwriting agreement or other agreement entered into by the Issuers;
(m) In the case of a Shelf Registration, make available for
inspection by a representative of the holders of Transfer Restricted
Securities being sold, any underwriter participating in any such
disposition of Transfer Restricted Securities, and any attorney,
consultant or accountant retained by such selling holders or
underwriter, at the offices where normally kept, during reasonable
business hours, all financial and other records, pertinent corporate
documents and properties of the Company and its subsidiaries
(including with respect to businesses and assets acquired or to be
acquired to the extent that such information is available to the
Company), and cause the officers, directors, agents and employees of
the Company and its subsidiaries (including with respect to businesses
and assets acquired or to be acquired to the extent that such
information is available to the Company) to supply all information in
each case reasonably requested by any such representative,
underwriter, attorney, consultant or accountant in connection with
such Shelf Registration; provided,however, that such persons shall
first agree in writing with the Company that any information that is
reasonably and in good faith designated by the Company in writing as
confidential at the time of delivery of such information shall be kept
confidential by such persons, unless (i) disclosure of such
information is required by court or administrative order or is
necessary to respond to inquiries of regulatory authorities, (ii)
disclosure of such information is required by law (including any
disclosure requirements pursuant to Federal securities laws in
connection with the filing of the Shelf Registration Statement or the
use of any Prospectus), (iii) such information becomes generally
available to the public other than as a result of a disclosure or
failure to safeguard such information by such person or (iv) such
information becomes available to such person from a source other than
the Company and its subsidiaries and such source is not bound by a
confidentiality agreement; and provided, further, that, before
disclosing such information pursuant to clause (i) or (ii) of this
Section 5(m), such person shall notify the Company as soon as
practicable so that the Company may seek a protective order or other
remedy and the foregoing inspection and information gathering shall be
coordinated on behalf of the Initial Purchasers by Xxxxx
17
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Barney and on behalf of any other persons, by one counsel designated
by and on behalf of such other persons;
(n) Provide an indenture trustee for the Notes and/or the
Exchange Notes and Private Exchange Notes, as the case may be, and
cause an indenture to be qualified under the TIA not later than the
effective date of the first Registration Statement relating to the
Notes and/or the Exchange Notes and Private Exchange Notes, as the
case may be; and if such indenture shall be the Indenture, in
connection therewith, cooperate with the Trustee and the holders of
the Notes and/or the Exchange Notes and Private Exchange Notes, to
effect such changes to the Indenture as may be required for the
Indenture to be (or to remain) so qualified in accordance with the
terms of the TIA; and execute, and use its commercially reasonable
best efforts to cause the Trustee to execute, all customary documents
as may be required to effect such changes, and all other forms and
documents required to be filed with the SEC to enable the Indenture to
be (or to remain) so qualified in a timely manner; and
(o) Comply with all applicable rules and regulations of the
SEC and make generally available to their security holders earning
statements satisfying the provisions of Section ll(a) of the
Securities Act and Rule 158, 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 Transfer Restricted Securities are sold to
underwriters in a firm commitment or reasonable efforts underwritten
offering and (ii) if not sold to underwriters in such an offering,
commencing on the first day of the first fiscal quarter after the
effective date of a Registration Statement, which statement shall
cover said period, consistent with the requirements of Rule 158;
(p) Cooperate with each seller of Transfer Restricted
Securities covered by any Registration Statement and each underwriter,
if any, participating in the disposition of such Transfer Restricted
Securities and their respective counsel in connection with any filings
required to be made with the National Association of Securities
Dealers, Inc.
The Issuers may require a holder of Transfer Restricted
Securities to be included in a Registration Statement to furnish to the Issuers
such information as is required by law to be disclosed by such holder in such
Registration Statement, and the Issuers may exclude from such Registration
Statement the Transfer Restricted Securities of any holder who unreasonably
fails to furnish such information within a reasonable time after receiving such
request.
If any such Registration Statement refers to any holder by
name or otherwise as the holder of any securities of an Issuer, then such
holder shall have the right to require (i) the insertion therein of language,
in form and substance reasonably satisfactory to such holder, to the effect
that the holding by such holder of such securities is not to be construed as a
recommendation by such
18
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holder of the investment quality of the Issuers' securities covered thereby and
that such holding does not imply that such holder will assist in meeting any
future financial requirements of the Issuers, or (ii) in the event that such
reference to such holder by name or otherwise is not required by the Securities
Act, the deletion of the reference to such holder in any amendment or
supplement to the Registration Statement filed or prepared subsequent to the
time that such reference ceases to be required.
In the case of a Shelf Registration pursuant to Section 3
hereof, each holder of Transfer Restricted Securities agrees by acquisition of
such Transfer Restricted Securities that, upon receipt of any notice from the
Company of the happening of any event of the kind described in Section
5(c)(ii), 5(c)(iii), 5(c)(iv) or 5(c)(v) hereof, such holder will forthwith
discontinue (i) disposition of such Transfer Restricted Securities covered by
such Registration Statement or Prospectus and (ii) use of such Prospectus until
such holder's receipt of the copies of the supplemented or amended Prospectus
contemplated by Section 5(j) hereof, or until it is advised in writing (the
"Advice") by the Company that the use of the applicable Prospectus may be
resumed, and, in either case, has received copies of any additional or
supplemental filings that are incorporated or deemed to be incorporated by
reference in such Prospectus. If the Company shall give any such notice, the
Effectiveness Period shall be extended by the number of days during such period
from and including the date of the giving of such notice to and including the
date when each holder of Transfer Restricted Securities covered by such
Registration Statement shall have received (x) the copies of the supplemented
or amended Prospectus contemplated by Section 5(j) hereof or (y) the Advice,
and, in either case, has received copies of any additional or supplemental
filings that are incorporated or deemed to be incorporated by reference in such
Prospectus.
6. Registration Expenses
All fees and expenses incident to the performance of or
compliance with this Agreement by the Issuers shall be borne by the Issuers
whether or not any Registration Statement is filed or becomes effective and
whether or not any Notes, Exchange Notes or Private Exchange Notes are issued
or sold pursuant to any Registration Statement. The fees and expenses referred
to in the foregoing sentence shall include, without limitation, (i) all
registration and filing fees (including, without limitation, fees and expenses
(A) with respect to filings required to be made with the National Association
of Securities Dealers, Inc. and (B) in compliance with securities or Blue Sky
laws), (ii) printing expenses (including, without limitation, expenses of
printing Prospectuses), (iii) reasonable fees and disbursements of counsel for
the Issuers and the Special Counsel, (iv) reasonable fees and disbursements of
all independent certified public accountants referred to in Section 2(e) and
Section 5(1)(iii) hereof (including, without limitation, the expenses of any
special audit and "cold comfort" letters required by or incident to such
performance), (v) if required, the reasonable fees and expenses of any
"qualified independent underwriter" and its counsel, and (vi) reasonable fees
and expenses of all other persons retained by the Issuers. In addition, the
Issuers
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shall pay their internal expenses (including, without limitation, all salaries
and expenses of their respective officers and employees performing legal or
accounting duties), the expense of any annual audit, and the fees and expenses
incurred in connection with the listing of the Notes, Exchange Notes or Private
Exchange Notes to be registered on any securities exchange. Notwithstanding the
foregoing or anything in this Agreement to the contrary, each holder of
Transfer Restricted Securities shall pay all underwriting discounts and
commissions of any underwriters with respect to any Notes, Exchange Notes or
Private Exchange Notes sold by it.
7. Indemnification
(a) The Issuers agree, jointly and severally, to indemnify
and hold harmless (i) each of the Initial Purchasers, each holder of Notes,
Exchange Notes and Private Exchange Notes and each Participating Broker-Dealer,
(ii) each person, if any, who controls (within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act) any of the foregoing (any of the persons
referred to in this clause (ii) being hereinafter referred to as a
("controlling person"), and (iii) the respective officers, directors, partners,
employees, representatives and agents of the Initial Purchasers, each holder of
Notes, Exchange Notes and Private Exchange Notes, each Participating
Broker-Dealer and any controlling person (any person referred to in clause (i),
(ii) or (iii) may hereinafter be referred to as an "Indemnified Person"), from
and against any and all losses, claims, damages, liabilities and judgments
arising out of or relating to any untrue statement or alleged untrue statement
of a material fact contained in any Registration Statement, Prospectus or
preliminary prospectus or in any amendment or supplement thereto, or arising
out of or relating to 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 case of any Prospectus or preliminary prospectus or supplement
thereto, in light of the circumstances under which they were made) not
misleading, except insofar as such losses, claims, damages, liabilities or
judgments are caused by any such untrue statement or omission or alleged untrue
statement or omission based upon information relating to any Indemnified Person
furnished in writing to the Issuers by or on behalf of such Indemnified Person
expressly for use therein, provided that the foregoing indemnity with respect
to any preliminary prospectus shall not inure to the benefit of any Indemnified
Person from whom the person asserting such losses, claims, damages, liabilities
and judgments purchased securities if such untrue statement or omission or
alleged untrue statement or omission made in such preliminary prospectus is
eliminated or remedied in the Prospectus and a copy of the Prospectus shall not
have been furnished to such person despite the Issuers' having previously
furnished sufficient copies of the Prospectus on a timely basis to permit such
furnishing.
(b) In case any action shall be brought against any
Indemnified Person, based upon any Registration Statement or any such
Prospectus or preliminary prospectus or any amendment or supplement thereto and
with respect to which indemnity may be sought against the Issuers hereunder,
such Indemnified Person shall promptly notify the Issuers in writing and the
Company
20
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shall assume the defense thereof, including the employment of counsel
reasonably satisfactory to such Indemnified Person and payment of all fees and
expenses. Any Indemnified Person shall have the right to employ separate
counsel in any such action and participate in the defense thereof, but the fees
and expenses of such counsel shall be at the expense of such Indemnified
Person, unless (i) the employment of such counsel shall have been specifically
authorized in writing by the Issuers, (ii) the Company shall have failed to
assume the defense and employ counsel or pay all such fees and expenses or
(iii) the named parties to any such action (including any impleaded parties)
include both such Indemnified Person and an Issuer and such Indemnified Person
shall have been advised by its counsel that representation of such Indemnified
Person and such Issuer by the same counsel would be inappropriate because there
may be one or more legal defenses available to it which are different from or
additional to those available to any such Issuer (in which case the Company
shall not have the right to assume the defense of such action on behalf of such
Indemnified Person, it being understood, however, that the Issuers shall not,
in connection with any one such action or separate but substantially similar or
related actions in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and expenses of
more than one separate firm of attorneys (in addition to any local counsel) for
all such Indemnified Persons, which firm shall be designated in writing by such
Indemnified Persons, and that all such reasonable fees and expenses shall be
reimbursed as they are incurred). The Issuers shall not be liable for any
settlement of any such action effected without their written consent but if
settled with the written consent of the Issuers, the Issuers agree, jointly and
severally, to indemnify and hold harmless each Indemnified Person from and
against any loss or liability by reason of such settlement. No Issuer shall,
without the prior written consent of each Indemnified Person, effect any
settlement of any pending or threatened proceeding in respect of which any
Indemnified Person is 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.
(c) In connection with any Registration Statement pursuant to
which a holder of Transfer Restricted Securities offers or sells Transfer
Restricted Securities, such holder agrees, severally and not jointly, to
indemnify and hold harmless the Issuers, their respective directors and
officers and any person controlling an Issuer 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 Indemnified Person but only
with respect to information relating to such holder furnished in writing by or
on behalf of such holder expressly for use in such Registration Statement. In
any such case in which any action shall be brought against an Issuer, any
director or officer of an Issuer or any person controlling an Issuer based on
such Registration Statement and in respect of which indemnity may be sought
against a holder of Transfer Restricted Securities, such holder shall have the
rights and duties given to the Issuers (except that if an Issuer shall have
assumed the defense thereof, such holder shall not be required to do so, but
may employ separate counsel therein and participate in the defense thereof but
the fees and expenses of such counsel shall be at the expense
21
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of such holder), and the Issuers, their respective directors and officers and
any person controlling an Issuer shall have the rights and duties given to the
Indemnified Persons by Section 7(b) hereof.
(d) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party in respect of any losses, claims, damages,
liabilities or judgments referred to herein, then each indemnifying party, in
lieu of indemnifying such indemnified party, shall contribute to the amount
paid or payable by such indemnified party as a result of such losses, claims,
damages, liabilities and judgments (i) in such proportion as is appropriate to
reflect the relative benefits received by each indemnifying party on the one
hand and the indemnified party on the other hand from the offering of the
Notes, the Exchange Notes or the Private Exchange Notes, as the case may be (it
being expressly understood and agreed that the relative benefits received by
the Issuers from the offering of the Notes, Exchange Notes or Private Exchange
Notes, as the case may be, shall be the amount of the net proceeds received by
the Company from the sale of the Notes to the Initial Purchasers), or (ii) if
the allocation provided by clause (i) above is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of each
indemnifying party on the one hand and the indemnified party on the other hand
in connection with the statements or omissions which resulted in such losses,
claims, damages, liabilities or judgments, as well as any other relevant
equitable considerations. The relative fault of each indemnifying party on the
one hand and the indemnified party on the other hand shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission to state a material fact relates
to information supplied by an indemnifying party or such indemnified party and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission.
The Issuers and the Initial Purchasers agree that it would not
be just and equitable if contribution pursuant to this Section 7(d) were
determined by pro rata allocation (even if the Indemnified Persons were treated
as one entity for such purpose) or by any other method of allocation which does
not take account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages, liabilities or judgments referred to in
the immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 7, no
Indemnified Person shall be required to contribute any amount in excess of the
amount by which the proceeds received by it in connection with the sale of the
Notes, Exchange Notes or Private Exchange Notes contemplated by this Agreement
exceeds the amount of any damages which such Indemnified Person has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section ll(f) of the Securities Act) shall be entitled
to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Indemnified Person's obligations to contribute pursuant
to this
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Section 7(d) are several in proportion to the respective amount of Notes,
Exchange Notes or Private Exchange Notes included in any such Registration
Statement by each Indemnified Person and not joint.
8. Rules 144 and 144A
Each of Issuers shall use its commercially reasonable best
efforts to file the reports required to be filed by it under the Securities Act
and the Exchange Act in a timely manner and, if at any time it is not required
to file such reports but in the past had been required to or did file such
reports, it will, upon the request of any holder of Transfer Restricted
Securities, make available other information as required by, and so long as
necessary to permit, sales of its Transfer Restricted Securities pursuant to
Rule 144A. Notwithstanding the foregoing, nothing in this Section 8 shall be
deemed to require an Issuer to register any of its securities pursuant to the
Exchange Act.
9. Underwritten Registrations
If any of the Transfer Restricted 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 administer the
offering will be selected by the holders of a majority in aggregate principal
amount of such Transfer Restricted Securities included in such offering,
subject to the consent of the Company (which will not be unreasonably withheld
or delayed).
No person may participate in any underwritten registration
hereunder unless such person (i) agrees to sell such Transfer Restricted
Securities on the basis reasonably provided in any underwriting arrangements
approved by the persons entitled hereunder to approve such arrangements and
(ii) completes and executes all questionnaires, powers of attorney,
indemnities, underwriting agreements and other documents required under the
terms of such underwriting arrangements.
10. Miscellaneous
(a) Remedies. In the event of a breach by an Issuer or
by a holder of Notes, Exchange Notes or Private Exchange Notes of any of its
obligations under this Agreement, each holder of Notes, Exchange Notes or
Private Exchange Notes and each Issuer, in addition to being entitled to
exercise all rights granted by law, including recovery of damages, will be
entitled to specific performance of its rights under this Agreement. Subject to
Section 4 hereof, the Issuers and each holder of Notes, Exchange Notes and
Private Exchange Notes agree that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach of any of the
provisions of this Agreement and each hereby further agrees that, in the event
of any action for specific performance in respect of such breach, it shall
waive the defense that a remedy at law would be adequate.
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(b) No Inconsistent Agreements. The Issuers will not
enter into any agreement with respect to their securities that is inconsistent
with the rights granted to the holders of Notes, Exchange Notes and Private
Exchange Notes and Indemnified Persons in this Agreement or otherwise conflicts
with the provisions hereof. Without the written consent of the holders of a
majority in aggregate principal amount of the outstanding Transfer Restricted
Securities, the Issuers shall not grant to any person any rights which conflict
with or are inconsistent with the provisions of this Agreement.
(c) No Piggyback on Registrations. The Issuers shall not
grant to any of their security holders (other than the holders of Transfer
Restricted Securities in such capacity) the right to include any of their
securities in any Registration Statement other than Transfer Restricted
Securities.
(d) 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, otherwise than with the prior written
consent of the holders of not less than a majority of the then outstanding
aggregate principal amount of Transfer Restricted Securities; provided,
however, that, for the purposes of this Agreement, Transfer Restricted
Securities that are owned, directly or indirectly, by the Issuers or any of
their Affiliates are not deemed outstanding. 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 Transfer Restricted
Securities whose securities are being sold pursuant to a Registration Statement
and that does not directly or indirectly affect the rights of other holders of
Transfer Restricted Securities may be given by holders of a majority in
aggregate principal amount of the Transfer Restricted Securities being sold by
such holders pursuant to such Registration Statement; and provided, further,
that the provisions of this sentence may not be amended, modified or
supplemented except in accordance with the provisions of the immediately
preceding sentence. Notwithstanding the foregoing, no amendment, modification,
supplement, waiver or consent with respect to Section 7 shall be made or given
otherwise than with the prior written consent of each Indemnified Person
affected thereby.
(e) Notices. All notices and other communications
provided for herein shall be made in writing by hand-delivery, next-day air
courier, certified first-class mail, return receipt requested, telex or
telecopier:
(i) if to the Issuers, as provided in the Purchase
Agreement,
(ii) if to the Initial Purchasers, as provided in the
Purchase Agreement, or
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(iii) if to any other person who is then the registered
holder of Notes, Exchange Notes or Private Exchange Notes, to the
address of such holder as it appears in the register therefor of the
Company.
Except as otherwise provided in this Agreement, all such
communications shall be deemed to have been duly given: when delivered by hand,
if personally delivered; one Business Day after being timely delivered to a
next-day air courier; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; and when receipt is
acknowledged by the recipient's telecopier machine, if telecopied.
(f) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and permitted assigns of each of
the parties and shall inure to the benefit of each holder of Notes, Exchange
Notes and Private Exchange Notes. The Issuers may not assign any of their
rights or obligations hereunder without the prior written consent of each
holder of Transfer Restricted Securities and each Indemnified Person.
Notwithstanding the foregoing, no successor or assignee of an Issuer shall have
any of the rights granted under this Agreement until such person shall
acknowledge its rights and obligations hereunder by a signed written statement
of such person's acceptance of such rights and obligations.
(g) Counterparts. This Agreement may be executed in any
number of counterparts and by the parties hereto in separate counterparts, each
of which when so executed shall be deemed to be an original and, all of which
taken together shall constitute one and the same Agreement.
(h) Governing Law; Submission to Jurisdiction. 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
YOUR. THE ISSUERS HEREBY IRREVOCABLY SUBMIT TO THE NON-EXCLUSIVE JURISDICTION
OF ANY COMPETENT NEW YORK STATE COURT SITTING IN THE BOROUGH OF MANHATTAN IN
THE CITY OF NEW YORK OR ANY FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN
IN THE CITY OF NEW YORK IN RESPECT OF ANY SUIT, ACTION OR PROCEEDING ARISING
OUT OF OR RELATING TO THIS AGREEMENT, AND EACH IRREVOCABLY ACCEPTS FOR ITSELF
AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY, THE
NON-EXCLUSIVE JURISDICTION OF THE AFORESAID COURTS.
(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 reasonable efforts to find and employ an
alternative means to achieve the same or substantially the
25
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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) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof. All references made in this Agreement to "Section" and
"paragraph" refer to such Section or paragraph of this Agreement, unless
expressly stated otherwise.
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IN WITNESS WHEREOF, the parties have caused this Registration Rights
Agreement to be duly executed as of the date first written above.
KCS ENERGY, INC.
By: /s/ XXXXX X. CHRISTMAS
Name: Xxxxx X. Christmas
Title: President
ENERCORP GAS MARKETING, INC.,
KCS RESOURCES, INC.,
KCS MICHIGAN RESOURCES, INC.,
KCS PIPELINE SYSTEMS, INC.,
KCS ENERGY MARKETING, INC.,
KCS POWER MARKETING, INC.,
KCS ENERGY RISK MANAGEMENT, INC.,
NATIONAL ENERDRILL CORPORATION AND
PROLIQ, INC.
By: /s/ XXXXX X. XXXXXX
---------------------------
Xxxxx X. Xxxxxx
Vice President
XXXXX XXXXXX INC.
XXXXXXXXX, XXXXXX & XXXXXXXX
SECURITIES CORPORATION
NOMURA INTERNATIONAL SECURITIES, INC.
PAINEWEBBER INCORPORATED
BY: XXXXX XXXXXX INC.
By: /s/ XXXXXX X. XXXXXXX, XX.
-------------------------------
Xxxxxx X. XxXxxxx, Xx.
Vice President
