REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made
and entered into May 13, 1997 among GST EQUIPMENT FUNDING, INC., a Delaware
corporation ("GST Funding"), GST USA, INC., a Delaware corporation ("GST USA"),
GST TELECOMMUNICATIONS, INC., a Canadian corporation ("GST"), and XXXXXX XXXXXXX
& CO. INCORPORATED, XXXXXX, READ & CO. INC. and TD SECURITIES (USA) INC.
(collectively referred to as the "Placement Agents").
This Agreement is made pursuant to the Placement Agreement
dated May 8, 1997 (the "Placement Agreement"), among GST Funding, GST USA, GST
and the Placement Agents, which provides for the sale by GST Funding to the
Placement Agents of $265,000,000 principal amount of GST Funding's 13 1/4%
Senior Secured Notes Due 2007 (the "Notes") to be issued by GST Funding pursuant
to the provisions of an Indenture dated as of May 13, 1997 (the "Indenture")
among GST Funding, GST USA, GST and United States Trust Company of New York, as
trustee (the "Trustee"). In order to induce the Placement Agents to enter into
the Placement Agreement, GST Funding, GST USA and GST have agreed to provide to
the Placement Agents and their direct and indirect transferees the registration
rights with respect to the Notes set forth in this Agreement. The execution of
this Agreement is a condition to the closing under the Placement Agreement.
In consideration of the foregoing, the parties hereto agree as
follows:
1. DEFINITIONS.
As used in this Agreement, the following capitalized defined
terms shall have the following meanings:
"1933 ACT" shall mean the Securities Act of 1933, as amended.
"1934 ACT" shall mean the Securities Exchange Act of 1934, as
amended.
"CLOSING DATE" shall mean the Closing Date as defined in the
Placement Agreement.
"EXCHANGE DATE" shall have the meaning set forth in Section
2(a)(ii) hereof.
"EXCHANGE NOTES" shall mean securities issued under the
Indenture by GST Funding or by GST USA, as the case may be, containing
terms identical to the Notes (except that the Exchange Notes will not
contain terms with respect to transfer restrictions) to be offered to
Holders of Notes in exchange for Notes pursuant to the Exchange Offer.
"EXCHANGE OFFER" shall mean the exchange offer by GST Funding
or GST USA, as the case may be, of Exchange Notes for Registrable Notes
pursuant to Section 2(a) hereof.
"EXCHANGE OFFER REGISTRATION" shall mean a registration under
the 1933 Act effected pursuant to Section 2(a) hereof.
"EXCHANGE OFFER REGISTRATION STATEMENT" shall mean an exchange
offer registration statement on Form S-4 (or, if applicable, on another
appropriate form) and all amendments and supplements to such
registration statement, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by
reference therein.
"GST" shall have the meaning set forth in the preamble and
shall also include GST's successors.
"GST FUNDING" shall have the meaning set forth in the preamble
and shall also include GST Funding's successors.
"GST USA" shall have the meaning set forth in the preamble and
shall also include GST USA's successors.
"HOLDER" shall mean the Placement Agents, for so long as they
own any Registrable Notes, and each of their successors, assigns and
direct and indirect transferees who become registered owners of
Registrable Notes under the Indenture; PROVIDED that for purposes of
Sections 4 and 5 hereof, the term "Holder" shall include Participating
Broker-Dealers.
"INDENTURE" shall have the meaning set forth in the preamble.
"MAJORITY HOLDERS" shall mean the Holders of a majority of the
aggregate principal amount of outstanding Registrable Notes; PROVIDED
that whenever the consent or approval of Holders of a specified
percentage of Registrable Notes is required hereunder, Registrable
Notes held by GST Funding or any of its affiliates (as such term is
defined in Rule 405 under the 0000 Xxx) (other than the Placement
Agents or subsequent holders of Registrable Notes if such subsequent
holders are deemed to be such affiliates solely by reason of their
holding of such Registrable Notes) shall not be counted in determining
whether such consent or approval was given by the Holders of such
required percentage or amount.
"PARTICIPATING BROKER-DEALER" shall have the meaning set forth
in Section 4(a) hereof.
"PERSON" shall mean an individual, partnership, corporation,
trust or unincorporated organization, or a government or agency or
political subdivision thereof.
"PLACEMENT AGENTS" shall have the meaning set forth in the
preamble.
"PLACEMENT AGREEMENT" shall have the meaning set forth in the
preamble.
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"PROSPECTUS" shall mean the prospectus included in a
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 Notes covered by a
Shelf Registration Statement, and by all other amendments and
supplements to such prospectus, and in each case including all material
incorporated by reference therein.
"REGISTRABLE NOTES" shall mean the Notes; PROVIDED, HOWEVER,
that the Notes shall cease to be Registrable Notes (i) when a
Registration Statement with respect to such Notes shall have been
declared effective under the 1933 Act and such Notes shall have been
disposed of or exchanged pursuant to such Registration Statement, (ii)
when such Notes have been sold to the public pursuant to Rule 144(k)
(or any similar provision then in force, but not Rule 144A) under the
1933 Act or (iii) when such Notes shall have ceased to be outstanding.
"REGISTRATION EXPENSES" shall mean any and all expenses
incident to performance of or compliance by GST Funding, GST USA and
GST with this Agreement, including without limitation: (i) all SEC,
stock exchange or National Association of Securities Dealers, Inc.
registration and filing fees, (ii) all fees and expenses incurred in
connection with compliance with state securities or blue sky laws
(including reasonable fees and disbursements of counsel for any
Underwriters or Holders in connection with blue sky qualification of
any of the Exchange Notes or Registrable Notes), (iii) all expenses of
any Persons in preparing or assisting in preparing, word processing,
printing and distributing any Registration Statement, any Prospectus,
any amendments or supplements thereto, any underwriting agreements,
securities sales agreements and other documents relating to the
performance of and compliance with this Agreement, (iv) all rating
agency fees, if any, (v) all fees and disbursements relating to the
qualification of the Indenture under applicable securities laws, (vi)
the fees and disbursements of the Trustee and its counsel, (vii) the
fees and disbursements of counsel for GST Funding, GST USA and GST and,
in the case of a Shelf Registration Statement, the fees and
disbursements of one counsel for the Holders (which counsel shall be
selected by the Majority Holders and which counsel may also be counsel
for the Placement Agents) and (viii) the fees and disbursements of the
independent public accountants of GST Funding, GST USA and GST,
including the expenses of any special audits or "cold comfort" letters
required by or incident to such performance and compliance, but
excluding fees and expenses of counsel to the Underwriters (other than
fees and expenses set forth in clause (ii) above) or the Holders and
underwriting discounts and commissions and transfer taxes, if any,
relating to the sale or disposition of Registrable Notes by a Holder.
"REGISTRATION STATEMENT" shall mean any registration statement
of GST Funding, GST USA or GST that covers any of the Exchange Notes or
Registrable Notes pursuant to the provisions of this Agreement and all
amendments and supplements to any such Registration Statement,
including post-effective amendments, in each case including the
Prospectus contained therein, all exhibits thereto and all material
incorporated by reference therein.
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"SEC" shall mean the Securities and Exchange Commission.
"SHELF REGISTRATION" shall mean a registration effected
pursuant to Section 2(b) hereof.
"SHELF REGISTRATION STATEMENT" shall mean a "shelf"
registration statement of GST Funding, GST USA or GST pursuant to the
provisions of Section 2(b) hereof which covers all of the Registrable
Notes (but no other securities unless approved by the Holders whose
Registrable Notes are covered by such Shelf Registration Statement) on
an appropriate form under Rule 415 under the 1933 Act, or any similar
rule that may be adopted by the SEC, and all amendments and supplements
to such registration statement, including post-effective amendments, in
each case including the Prospectus contained therein, all exhibits
thereto and all material incorporated by reference therein.
"TIA" shall have the meaning set forth in Section 3(l) hereof.
"TRUSTEE" shall have the meaning set forth in the preamble and
its successors under the Indenture.
"UNDERWRITTEN REGISTRATION" or "UNDERWRITTEN OFFERING" shall
mean a registration in which Registrable Notes are sold to an
Underwriter for reoffering to the public.
"UNDERWRITERS" shall have the meaning set forth in Section 3
hereof.
2. REGISTRATION UNDER THE 1933 ACT.
(a) To the extent not prohibited by any applicable law or
applicable interpretation of the Staff of the SEC, GST Funding, GST USA and GST
shall cause to be filed an Exchange Offer Registration Statement covering the
offer by GST Funding or GST USA, as the case may be, to the Holders to exchange
all of the Registrable Notes for Exchange Notes, to have such Registration
Statement remain effective until the closing of the Exchange Offer and to
consummate the Exchange Offer on or prior to the date that is six months after
the Closing Date. GST Funding or GST USA, as the case may be, shall commence the
Exchange Offer promptly after the Exchange Offer Registration Statement has been
declared effective by the SEC and use its best efforts to have the Exchange
Offer consummated not later than 60 days after such effective date. GST Funding
or GST USA, as the case may be, shall commence the Exchange Offer by mailing the
related exchange offer Prospectus and accompanying documents to each Holder
stating, 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 Registrable Notes validly tendered will be
accepted for exchange;
(ii) the dates of acceptance for exchange (which shall be a
period of at least 20 business days from the date such notice is
mailed) (each such date being an "Exchange Date");
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(iii) that any Registrable Note not tendered will remain
outstanding and continue to accrue interest, but will not retain any
rights under this Agreement;
(iv) that Holders electing to have a Registrable Note
exchanged pursuant to the Exchange Offer will be required to surrender
such Registrable Note, together with the enclosed letters of
transmittal, to the institution and at the address (located in the
Borough of Manhattan, The City of New York) specified in the notice
prior to the close of business on the last Exchange Date; and
(v) that Holders will be entitled to withdraw their election,
not later than the close of business on the last Exchange Date, by
sending to the institution and at the address (located in the Borough
of Manhattan, The City of New York) specified in the notice a telegram,
telex, facsimile transmission or letter setting forth the name of such
Holder, the principal amount of Registrable Notes delivered for
exchange and a statement that such Holder is withdrawing his election
to have such Notes exchanged.
As soon as practicable after the last Exchange Date, GST
Funding or GST USA, as the case may be, shall:
(i) accept for exchange Registrable Notes or portions thereof
tendered and not validly withdrawn pursuant to the Exchange Offer; and
(ii) deliver, or cause to be delivered, to the Trustee for
cancellation all Registrable Notes or portions thereof so accepted for
exchange by GST Funding or GST USA, as the case may be, and issue, and
cause the Trustee to promptly authenticate and mail, to each Holder an
Exchange Note of equal principal amount.
GST Funding, GST USA and GST shall use their best efforts to complete the
Exchange Offer as provided above and shall comply with the applicable
requirements of the 1933 Act, the 1934 Act and other applicable laws and
regulations in connection with the Exchange Offer. The Exchange Offer shall not
be subject to any conditions, other than that the Exchange Offer does not
violate applicable law or any applicable interpretation of the Staff of the SEC.
GST Funding or GST USA, as the case may be, shall inform the Placement Agents of
the names and addresses of the Holders to whom the Exchange Offer is made, and
the Placement Agents shall have the right, subject to applicable law, to contact
such Holders and otherwise facilitate the tender of Registrable Notes in the
Exchange Offer.
(b) In the event that (i) GST Funding, GST USA or GST
determines that the Exchange Offer Registration provided for in Section 2(a)
above is not available or may not be consummated as soon as practicable after
the last Exchange Date because it would violate applicable law or the applicable
interpretations of the Staff of the SEC, (ii) the Exchange Offer is not for any
other reason consummated by November 13, 1997 or (iii) the Exchange Offer has
been completed and in the opinion of counsel for the Placement Agents, a
Registration Statement must be filed and a Prospectus must be delivered by the
Placement Agents in connection with any offering or sale of Registrable Notes,
GST Funding, GST USA and GST shall use their best
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efforts to cause to be filed as soon as practicable after such determination,
date or notice of such opinion of counsel is given to GST Funding, GST USA or
GST, as the case may be, a Shelf Registration Statement providing for the sale
by the Holders of all of the Registrable Notes and to have such Shelf
Registration Statement declared effective by the SEC. In the event GST Funding,
GST USA or GST, as the case may be, is required to file a Shelf Registration
Statement solely as a result of the matters referred to in clause (iii) of the
preceding sentence, GST Funding, GST USA or GST, as the case may be, shall file
and have declared effective by the SEC both an Exchange Offer Registration
Statement pursuant to Section 2(a) with respect to all Registrable Notes and a
Shelf Registration Statement (which may be a combined Registration Statement
with the Exchange Offer Registration Statement) with respect to offers and sales
of Registrable Notes held by the Placement Agents after completion of the
Exchange Offer. GST Funding, GST USA and GST agree to use their best efforts to
keep the Shelf Registration Statement continuously effective until the
expiration of the period referred to in Rule 144(k) for the Registrable Notes
covered by such Shelf Registration Statement or such shorter period that will
terminate when all of the Registrable Notes covered by the Shelf Registration
Statement have been sold pursuant to the Shelf Registration Statement. GST
Funding, GST USA and GST further agree to supplement or amend the Shelf
Registration Statement if required by the rules, regulations or instructions
applicable to the registration form used by GST Funding or GST USA, as the case
may be, for such Shelf Registration Statement or by the 1933 Act or by any other
rules and regulations thereunder for shelf registration or if reasonably
requested by a Holder with respect to information relating to such Holder, and
to use their best efforts to cause any such amendment to become effective and
such Shelf Registration Statement to become usable as soon as thereafter
practicable. GST Funding, GST USA and GST agree to furnish to the Holders of
Registrable Notes copies of any such supplement or amendment promptly after its
being used or filed with the SEC.
(c) GST Funding, GST USA and GST shall pay all Registration
Expenses in connection with the registration pursuant to Section 2(a) or Section
2(b) hereof. Each Holder shall pay all underwriting discounts and commissions
and transfer taxes, if any, relating to the sale or disposition of such Holder's
Registrable Notes pursuant to the Shelf Registration Statement.
(d) An Exchange Offer Registration Statement pursuant to
Section 2(a) hereof or a Shelf Registration Statement pursuant to Section 2(b)
hereof will not be deemed to have become effective unless it has been declared
effective by the SEC; PROVIDED, HOWEVER, that, if, after it has been declared
effective, the offering of Registrable Notes pursuant to a Shelf Registration
Statement is interfered with by any stop order, injunction or other order or
requirement of the SEC or any other governmental agency or court, such
Registration Statement will be deemed not to have become effective during the
period of such interference until the offering of Registrable Notes pursuant to
such Registration Statement may legally resume. As provided for in the
Indenture, in the event the Exchange Offer is not consummated and the Shelf
Registration Statement is not declared effective on or prior to November 13,
1997, interest (in addition to the interest otherwise due on the Notes) on the
Notes will accrue, at an annual rate of 0.5%, from November 13, 1997.
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(e) Without limiting the remedies available to the Placement
Agents and the Holders, GST Funding, GST USA and GST acknowledge that any
failure by GST Funding, GST USA and GST to comply with their obligations under
Section 2(a) and Section 2(b) hereof may result in material irreparable injury
to the Placement Agents or the Holders for which there is no adequate remedy at
law, that it will not be possible to measure damages for such injuries precisely
and that, in the event of any such failure, the Placement Agents or any Holder
may obtain such relief as may be required to specifically enforce GST Funding's,
GST USA's and GST's obligations under Section 2(a) and Section 2(b) hereof.
(f) During any consecutive 365-day period, GST Funding, GST
USA and GST may suspend availability of any Shelf Registration Statement for no
more than two periods of up to 45 consecutive days (except for the consecutive
45-day period immediately prior to the maturity of the Notes) and for no more
than an aggregate of 60 days during any 365-day period, if GST's Board of
Directors determines in good faith that there is a valid purpose for such
suspension.
3. REGISTRATION PROCEDURES.
In connection with the respective obligations of GST Funding,
GST USA and GST with respect to the Registration Statements pursuant to Section
2(a) and Section 2(b) hereof, GST Funding, GST USA and GST shall, as
expeditiously as possible:
(a) prepare and file with the SEC a Registration Statement on
the appropriate form under the 1933 Act, which form shall (i) be
selected by GST Funding or GST USA, (ii) in the case of a Shelf
Registration, be available for the sale of the Registrable Notes by the
selling Holders thereof and (iii) comply as to form in all material
respects with the requirements of the applicable form and include all
financial statements required by the SEC to be filed therewith, and use
their best efforts to cause such Registration Statement to become
effective and remain effective in accordance with Section 2 hereof;
(b) prepare and file with the SEC such amendments and
post-effective amendments to each Registration Statement as may be
necessary to keep such Registration Statement effective for the
applicable period and cause each Prospectus to be supplemented by any
required prospectus supplement and, as so supplemented, to be filed
pursuant to Rule 424 under the 1933 Act; and keep each Prospectus
current during the period described under Section 4(3) and Rule 174
under the 1933 Act that is applicable to transactions by brokers or
dealers with respect to the Registrable Notes or Exchange Notes;
(c) in the case of a Shelf Registration, furnish to each
Holder of Registrable Notes, to counsel for the Placement Agents, to
counsel for the Holders and to each Underwriter of an Underwritten
Offering of Registrable Notes, if any, without charge, as many copies
of each Prospectus, including each preliminary Prospectus, and any
amendment or supplement thereto and such other documents as such Holder
or Underwriter may reasonably request, in order to facilitate the
public sale or other
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disposition of the Registrable Notes; and GST Funding, GST USA and GST
consent to the use of such Prospectus and any amendment or supplement
thereto in accordance with applicable law by each of the selling
Holders of Registrable Notes and any such Underwriters in connection
with the offering and sale of the Registrable Notes covered by and in
the manner described in such Prospectus or any amendment or supplement
thereto in accordance with applicable law;
(d) use their best efforts (i) to register or qualify, by the
time the applicable Registration Statement is declared effective by the
SEC, the Registrable Notes under all applicable state securities laws
or blue sky laws of such jurisdictions as any Holder of Registrable
Notes covered by a Registration Statement shall reasonably request in
writing and (ii) to cooperate with such Holder in connection with any
filings required to be made with the National Association of Securities
Dealers, Inc. and do any and all other acts and things which may be
reasonably necessary or advisable to enable such Holder to consummate
the disposition in each such jurisdiction of such Registrable Notes
owned by such Holder; PROVIDED, HOWEVER, that none of GST Funding, GST
USA or GST shall be required to (A) qualify as a foreign corporation or
as a dealer in securities in any jurisdiction where it would not
otherwise be required to qualify but for this Section 3(d), (B) file
any general consent to service of process or (C) subject itself to
taxation in any such jurisdiction if it is not otherwise so subject;
(e) in the case of a Shelf Registration, notify each Holder of
Registrable Notes, counsel for the Holders and counsel for the
Placement Agents promptly and, if requested by any such Holder or
counsel, confirm such advice in writing (i) when a Registration
Statement has become effective and when any post-effective amendment
thereto has been filed and becomes effective, (ii) of any request by
the SEC or any state securities authority for amendments and
supplements to a Registration Statement and Prospectus or for
additional information after the Registration Statement has become
effective, (iii) of the issuance by the SEC or any state securities
authority of any stop order suspending the effectiveness of a
Registration Statement or the initiation of any proceedings for that
purpose, (iv) if, between the effective date of a Registration
Statement and the closing of any sale of Registrable Notes covered
thereby, the representations and warranties of GST Funding, GST USA or
GST contained in any underwriting agreement, securities sales agreement
or other similar agreement, if any, relating to the offering cease to
be true and correct in all material respects or if GST Funding, GST USA
or GST receives any notification with respect to the suspension of the
qualification of the Registrable Notes for sale in any jurisdiction or
the initiation of any proceeding for such purpose, (v) of the happening
of any event during the period a Shelf Registration Statement is
effective which makes any statement made in such Registration Statement
or the related Prospectus untrue in any material respect or which
requires the making of any changes in such Registration Statement or
Prospectus in order to make the statements therein not misleading and
(vi) of any determination by GST Funding, GST USA or GST that a
post-effective amendment to a Registration Statement would be
appropriate;
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(f) make every reasonable effort to obtain the withdrawal of
any order suspending the effectiveness of a Registration Statement at
the earliest possible moment and provide immediate notice to each
Holder of the withdrawal of any such order;
(g) in the case of a Shelf Registration, furnish to each
Holder of Registrable Notes, without charge, at least one conformed
copy of each Registration Statement and any post-effective amendment
thereto (without documents incorporated therein by reference or
exhibits thereto, unless requested);
(h) in the case of a Shelf Registration, cooperate with the
selling Holders of Registrable Notes to facilitate the timely
preparation and delivery of certificates representing Registrable Notes
to be sold and not bearing any restrictive legends and enable such
Registrable Notes to be in such denominations (consistent with the
provisions of the Indenture) and registered in such names as the
selling Holders may reasonably request at least one business day prior
to the closing of any sale of Registrable Notes;
(i) in the case of a Shelf Registration, upon the occurrence
of any event contemplated by Section 3(e)(v) hereof, use their best
efforts to prepare a supplement or post-effective amendment to a
Registration Statement or the related Prospectus or any document
incorporated therein by reference or file any other required document
so that, as thereafter delivered to the purchasers of the Registrable
Notes, such Prospectus will not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading. GST Funding, GST USA and GST agree to notify the
Holders to suspend use of the Prospectus as promptly as practicable
after the occurrence of such an event, and the Holders hereby agree to
suspend use of the Prospectus until GST Funding, GST USA or GST, as the
case may be, has amended or supplemented the Prospectus to correct such
misstatement or omission;
(j) within a reasonable time prior to the filing of any
Registration Statement, any Prospectus, any amendment to a Registration
Statement or amendment or supplement to a Prospectus or any document
which is to be incorporated by reference into a Registration Statement
or a Prospectus after initial filing of a Registration Statement,
provide copies of such document to the Placement Agents and its counsel
(and, in the case of a Shelf Registration Statement, the Holders and
their counsel) and make such of the representatives of GST Funding, GST
USA and GST as shall be reasonably requested by the Placement Agents or
its counsel (and, in the case of a Shelf Registration Statement, the
Holders or their counsel) available for discussion of such document,
and shall not at any time file or make any amendment to the
Registration Statement, any Prospectus or any amendment of or
supplement to a Registration Statement or a Prospectus or any document
which is to be incorporated by reference into a Registration Statement
or a Prospectus, of which the Placement Agents and its counsel (and, in
the case of a Shelf Registration Statement, the Holders and their
counsel) shall not have previously been advised and furnished a copy
or, other than with respect to documents filed pursuant to the 1934
Act, to which the Placement Agents or their counsel (and, in
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the case of a Shelf Registration Statement, the Holders or their
counsel) shall reasonably object, except for any amendment or
supplement or document, a copy of which has been previously furnished
to the Placement Agents and its counsel (and, in the case of a Shelf
Registration Statement, the Holders and their counsel), which counsel
for GST Funding, GST USA and GST shall advise GST Funding, GST USA and
GST, in the form of a written legal opinion, is required in order to
comply with applicable law;
(k) obtain a CUSIP number for all Exchange Notes or
Registrable Notes, as the case may be, not later than the effective
date of a Registration Statement;
(l) cause the Indenture to be qualified under the Trust
Indenture Act of 1939, as amended (the "TIA"), in connection with the
registration of the Exchange Notes or Registrable Notes, as the case
may be, cooperate with the Trustee and the Holders to effect such
changes to the Indenture as may be required for the Indenture to be so
qualified in accordance with the terms of the TIA and execute, and use
their best efforts to cause the Trustee to execute all documents as may
be required to effect such changes and all other forms and documents
required to be filed with the SEC to enable the Indenture to be so
qualified in a timely manner;
(m) in the case of a Shelf Registration, make available for
inspection by a representative of the Holders of the Registrable Notes,
any Underwriter participating in any disposition pursuant to such Shelf
Registration Statement, and attorneys and accountants designated by the
Holders, at reasonable times and in a reasonable manner, all financial
and other records, pertinent documents and properties of GST Funding,
GST USA and GST, and cause the respective officers, directors and
employees of GST Funding, GST USA and GST to supply all information
reasonably requested by any such representative, Underwriter, attorney
or accountant in connection with a Shelf Registration Statement;
(n) in the case of a Shelf Registration, use their best
efforts to cause all Registrable Notes to be listed on any securities
exchange or any automated quotation system on which similar securities
issued by GST USA or GST are then listed if requested by the Majority
Holders, to the extent such Registrable Notes satisfy applicable
listing requirements;
(o) use their best efforts to cause the Exchange Notes or
Registrable Notes, as the case may be, to be rated by two nationally
recognized statistical rating organizations (as such term is defined in
Rule 436(g)(2) under the 0000 Xxx);
(p) if reasonably requested by any Holder of Registrable Notes
covered by a Registration Statement, (i) promptly incorporate in a
Prospectus supplement or post-effective amendment such information with
respect to such Holder as such Holder reasonably requests to be
included therein and (ii) make all required filings of such Prospectus
supplement or such post-effective amendment as soon as GST Funding, GST
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USA or GST has received notification of the matters to be incorporated
in such filing; and
(q) in the case of a Shelf Registration, enter into such
customary agreements and take all such other actions in connection
therewith (including those requested by the Holders of a majority of
the Registrable Notes being sold) in order to expedite or facilitate
the disposition of such Registrable Notes including, but not limited
to, an Underwritten Offering and in such connection, (i) to the extent
possible, make such representations and warranties to the Holders and
any Underwriters of such Registrable Notes with respect to the business
of GST Funding, GST USA and GST and their subsidiaries, the
Registration Statement, Prospectus and documents incorporated by
reference or deemed incorporated by reference, if any, 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 GST Funding, GST USA and
GST (which counsel and opinions, in form, scope and substance, shall be
reasonably satisfactory to the Holders and such Underwriters and their
respective counsel) addressed to each selling Holder and Underwriter of
Registrable Notes, covering the matters customarily covered in opinions
requested in underwritten offerings, (iii) obtain "cold comfort"
letters from the independent certified public accountants of GST
Funding, GST USA and GST (and, if necessary, any other certified public
accountant of any subsidiary of GST Funding, GST USA and GST, or of any
business acquired by GST Funding, GST USA or GST for which financial
statements and financial data are or are required to be included in the
Registration Statement) addressed to each selling Holder and
Underwriter of Registrable Notes, such letters to be in customary form
and covering matters of the type customarily covered in "cold comfort"
letters in connection with underwritten offerings, and (iv) deliver
such documents and certificates as may be reasonably requested by the
Holders of a majority in principal amount of the Registrable Notes
being sold or the Underwriters, and which are customarily delivered in
underwritten offerings, to evidence the continued validity of the
representations and warranties of GST Funding, GST USA and GST made
pursuant to clause (i) above and to evidence compliance with any
customary conditions contained in an underwriting agreement.
In the case of a Shelf Registration Statement, GST Funding,
GST USA or GST may require each Holder of Registrable Notes to furnish to GST
Funding, GST USA or GST such information regarding the Holder and the proposed
distribution by such Holder of such Registrable Notes as GST Funding, GST USA or
GST may from time to time reasonably request in writing.
In the case of a Shelf Registration Statement, each Holder
agrees that, upon receipt of any notice from GST Funding, GST USA or GST of the
happening of any event of the kind described in Section 3(e)(v) hereof, such
Holder will forthwith discontinue disposition of Registrable Notes pursuant to a
Registration Statement until such Holder's receipt of the copies of the
supplemented or amended Prospectus contemplated by Section 3(i) hereof, and, if
so directed by GST Funding, GST USA or GST, such Holder will deliver to GST
Funding, GST
11
USA or GST (at its expense) all copies in its possession, other than permanent
file copies then in such Holder's possession, of the Prospectus covering such
Registrable Notes current at the time of receipt of such notice. If GST Funding,
GST USA or GST shall give any such notice to suspend the disposition of
Registrable Notes pursuant to a Registration Statement, GST Funding, GST USA and
GST shall extend the period during which the Registration Statement shall be
maintained effective pursuant to this Agreement by the number of days during the
period from and including the date of the giving of such notice to and including
the date when the Holders shall have received copies of the supplemented or
amended Prospectus necessary to resume such dispositions.
The Holders of Registrable Notes covered by a Shelf
Registration Statement who desire to do so may sell such Registrable Notes in an
Underwritten Offering. In any such Underwritten Offering, the investment banker
or investment bankers and manager or managers (the "Underwriters") that will
administer the offering will be selected by the Majority Holders of the
Registrable Notes included in such offering.
4. PARTICIPATION OF BROKER-DEALERS IN EXCHANGE OFFER.
(a) GST Funding, GST USA and GST understand that the Staff of
the SEC has taken the position that any broker-dealer that receives Exchange
Notes for its own account in the Exchange Offer in exchange for Notes that were
acquired by such broker-dealer as a result of market-making or other trading
activities (a "Participating Broker-Dealer"), may be deemed to be an
"underwriter" within the meaning of the 1933 Act and must deliver a prospectus
meeting the requirements of the 1933 Act in connection with any resale of such
Exchange Notes.
GST Funding, GST USA and GST understand that it is the Staff's
position that if the Prospectus contained in the Exchange Offer 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 obligation
under the 1933 Act in connection with resales of Exchange Notes for their own
accounts, so long as the Prospectus otherwise meets the requirements of the 1933
Act.
(b) In light of the above, notwithstanding the other
provisions of this Agreement, GST Funding, GST USA and GST agree that the
provisions of this Agreement as they relate to a Shelf Registration shall also
apply to an Exchange Offer Registration to the extent, and with such reasonable
modifications thereto as may be, reasonably requested by the Placement Agent or
by one or more Participating Broker-Dealers, in each case as provided in clause
(ii) below, in order to expedite or facilitate the disposition of any Exchange
Notes by Participating Broker-Dealers consistent with the positions of the Staff
recited in Section 4(a) above; PROVIDED that:
(i) GST Funding, GST USA and GST shall not be required to
amend or supplement the Prospectus contained in the Exchange Offer
Registration Statement, as
12
would otherwise be contemplated by Section 3(i) hereof, for a period
exceeding 180 days after the last Exchange Date (as such period may be
extended pursuant to the penultimate paragraph of Section 3 hereof) and
Participating Broker-Dealers shall not be authorized by GST Funding,
GST USA or GST to deliver and shall not deliver such Prospectus after
such period in connection with the resales contemplated by this Section
4; and
(ii) the application of the Shelf Registration procedures set
forth in Section 3 hereof to an Exchange Offer Registration, to the
extent not required by the positions of the Staff of the SEC or the
1933 Act and the rules and regulations thereunder, will be in
conformity with the reasonable request to GST Funding, GST USA and GST
by the Placement Agents or with the reasonable request in writing to
GST Funding, GST USA and GST by one or more broker-dealers who certify
to the Placement Agents, GST Funding, GST USA and GST in writing that
they anticipate that they will be Participating Broker-Dealers; and
PROVIDED FURTHER that, in connection with such application of the Shelf
Registration procedures set forth in Section 3 hereof to an Exchange
Offer Registration, GST Funding, GST USA and GST shall be obligated (A)
to deal only with one entity representing the Participating
Broker-Dealers, which shall be Xxxxxx Xxxxxxx & Co. Incorporated unless
it elects not to act as such representative, (B) to pay the fees and
expenses of only one counsel representing the Participating
Broker-Dealers, which shall be counsel to the Placement Agents unless
such counsel elects not to so act and (C) to cause to be delivered only
one, if any, "cold comfort" letter with respect to the Prospectus in
the form existing on the last Exchange Date and with respect to each
subsequent amendment or supplement, if any, effected during the period
specified in clause (i) above.
(c) The Placement Agents shall have no liability to GST
Funding, GST USA, GST or any Holder with respect to any request that it may make
pursuant to Section 4(b) above.
5. INDEMNIFICATION AND CONTRIBUTION.
(a) Each of GST Funding, GST USA and GST agrees, jointly and
severally, to indemnify and hold harmless the Placement Agents, each Holder and
each Person, if any, who controls the Placement Agents or any Holder within the
meaning of either Section 15 of the 1933 Act or Section 20 of the 1934 Act, or
is under common control with, or is controlled by, the Placement Agents or any
Holder, from and against all losses, claims, damages and liabilities (including,
without limitation, any legal or other expenses reasonably incurred by the
Placement Agents, any Holder or any such controlling or affiliated Person in
connection with defending or investigating any such action or claim) caused by
any untrue statement or alleged untrue statement of a material fact contained in
any Registration Statement (or any amendment thereto) pursuant to which Exchange
Notes or Registrable Notes were registered under the 1933 Act, including all
documents incorporated therein by reference, or caused by any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, or caused by any
untrue statement or alleged untrue statement of a material fact contained in any
Prospectus (as amended or supplemented if GST Funding, GST USA or GST shall have
furnished any amendments or supplements thereto), or caused by
13
any omission or alleged omission to state therein a material fact necessary to
make the statements therein in light of the circumstances under which they were
made not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any such untrue statement or omission or alleged
untrue statement or omission based upon information relating to the Placement
Agents or any Holder furnished to GST Funding, GST USA or GST in writing by the
Placement Agents or any selling Holder expressly for use therein. In connection
with any Underwritten Offering permitted by Section 3 hereof, GST Funding, GST
USA and GST will also indemnify the Underwriters, if any, selling brokers,
dealers and similar securities industry professionals participating in the
distribution, their officers and directors and each Person who controls such
Persons (within the meaning of the 1933 Act and the 0000 Xxx) to the same extent
as provided above with respect to the indemnification of the Holders, if
requested in connection with any Registration Statement.
(b) Each Holder agrees, severally and not jointly, to
indemnify and hold harmless GST Funding, GST USA and GST, the Placement Agents
and the other selling Holders, and each of their respective directors, officers
who sign the Registration Statement and each Person, if any, who controls GST
Funding, GST USA or GST, the Placement Agents and any other selling Holder
within the meaning of either Section 15 of the 1933 Act or Section 20 of the
1934 Act to the same extent as the foregoing indemnity from GST Funding, GST USA
and GST to the Placement Agents and the Holders, but only with reference to
information relating to such Holder furnished to GST Funding, GST USA or GST in
writing by such Holder expressly for use in any Registration Statement (or any
amendment thereto) or any Prospectus (or any amendment or supplement thereto).
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any Person in respect of which
indemnity may be sought pursuant to either paragraph (a) or paragraph (b) above,
such Person (the "indemnified party") shall promptly notify the Person against
whom such indemnity may be sought (the "indemnifying party") in writing and the
indemnifying party, upon request of the indemnified party, shall retain counsel
reasonably satisfactory to the indemnified party to represent the indemnified
party and any others the indemnifying party may designate in such proceeding and
shall pay the fees and disbursements of such counsel related to such proceeding.
In any such proceeding, any indemnified party shall have the right to retain its
own counsel, but the fees and expenses of such counsel shall be at the expense
of such indemnified party unless (i) the indemnifying party and the indemnified
party shall have mutually agreed to the retention of such counsel or (ii) the
named parties to any such proceeding (including any impleaded parties) include
both the indemnifying party and the indemnified party and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the indemnifying party
shall not, in connection with any proceeding or related proceedings in the same
jurisdiction, be liable for (a) the fees and expenses of more than one separate
firm (in addition to any local counsel) for the Placement Agents and all
Persons, if any, who control the Placement Agents within the meaning of either
Section 15 of the 1933 Act or Xxxxxxx 00 xx xxx 0000 Xxx, (x) the fees and
expenses of more than one separate firm (in addition to any local counsel) for
GST Funding, GST USA and GST, their directors, their officers who sign the
Registration Statement and each Person, if any, who controls GST Funding, GST
USA
14
or GST within the meaning of either such Section and (c) the fees and expenses
of more than one separate firm (in addition to any local counsel) for all
Holders and all Persons, if any, who control any Holders within the meaning of
either such Section, and that all such fees and expenses shall be reimbursed as
they are incurred. In such case involving the Placement Agents and Persons who
control the Placement Agents, such firm shall be designated in writing by Xxxxxx
Xxxxxxx & Co. Incorporated. In such case involving the Holders and such Persons
who control Holders, such firm shall be designated in writing by the Majority
Holders. In all other cases, such firm shall be designated by GST. The
indemnifying party shall not be liable for any settlement of any proceeding
effected without its written consent but, if settled with such consent or if
there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason
of such settlement or judgment. Notwithstanding the foregoing sentence, if at
any time an indemnified party shall have requested an indemnifying party to
reimburse the indemnified party for fees and expenses of counsel as contemplated
by the second and third sentences of this paragraph, the indemnifying party
agrees that it shall be liable for any settlement of any proceeding effected
without its written consent if (i) such settlement is entered into more than 30
days after receipt by such indemnifying party of the aforesaid request and (ii)
such indemnifying party shall not have reimbursed the indemnified party for such
fees and expenses of counsel in accordance with such request prior to the date
of such settlement. No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which such indemnified party is or could
have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such proceeding.
(d) If the indemnification provided for in paragraph (a) or
paragraph (b) of this Section 5 is unavailable to an indemnified party or
insufficient in respect of any losses, claims, damages or liabilities, then each
indemnifying party under such paragraph, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities in such proportion as is appropriate to reflect the relative fault
of the indemnifying party or parties on the one hand and of the indemnified
party or parties on the other hand in connection with the statements or
omissions that resulted in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations. The relative fault of GST
Funding, GST USA, GST and the Holders 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 GST Funding, GST USA, GST or by the Holders and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The Holders' respective
obligations to contribute pursuant to this Section 5(d) are several in
proportion to the respective principal amount of Registrable Notes of such
Holder that were registered pursuant to a Registration Statement.
(e) GST Funding, GST USA, GST, and each Holder agree that it
would not be just or equitable if contribution pursuant to this Section 5 were
determined by PRO RATA allocation or by any other method of allocation that does
not take account of the equitable
15
considerations referred to in paragraph (d) above. The amount paid or payable by
an indemnified party as a result of the losses, claims, damages and liabilities
referred to in paragraph (d) above 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 5, no Holder
shall be required to indemnify or contribute any amount in excess of the amount
by which the total price at which Registrable Notes were sold by such Holder
exceeds the amount of any damages that such Holder has otherwise been required
to pay by reason of such untrue or alleged untrue statement or omission or
alleged omission. No Person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the 0000 Xxx) shall be entitled to contribution from
any Person who was not guilty of such fraudulent misrepresentation. The remedies
provided for in this Section 5 are not exclusive and shall not limit any rights
or remedies which may otherwise be available to any indemnified party at law or
in equity.
(f) The indemnity and contribution provisions contained in
this Section 5 shall remain operative and in full force and effect regardless of
(i) any termination of this Agreement, (ii) any investigation made by or on
behalf of the Placement Agents, any Holder or any person controlling the
Placement Agents or any Holder, or by or on behalf of GST Funding, GST USA, GST,
their officers or directors or any person controlling GST Funding, GST USA or
GST, (iii) acceptance of any of the Exchange Notes and (iv) any sale of
Registrable Notes pursuant to a Shelf Registration Statement.
6. MISCELLANEOUS.
(a) NO INCONSISTENT AGREEMENTS. None of GST Funding, GST USA
or GST has entered into, and on or after the date of this Agreement will enter
into, any agreement which is inconsistent with the rights granted to the Holders
of Registrable Notes in this Agreement or otherwise conflicts with the
provisions hereof. The rights granted to the Holders hereunder do not in any way
conflict with and are not inconsistent with the rights granted to the holders of
GST Funding's, GST USA's or GST's other issued and outstanding securities under
any such agreements.
(b) AMENDMENTS AND WAIVERS. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given unless GST Funding, GST USA and GST have obtained the written
consent of Holders of at least a majority in aggregate principal amount of the
outstanding Registrable Notes affected by such amendment, modification,
supplement, waiver or consent; PROVIDED, HOWEVER, that no amendment,
modification, supplement, waiver or consents to any departure from the
provisions of Section 5 hereof shall be effective as against any Holder of
Registrable Notes unless consented to in writing by such Holder.
(c) NOTICES. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand-delivery, registered
first-class mail, telex, telecopier,
16
or any courier guaranteeing overnight delivery (i) if to a Holder, at the most
current address given by such Holder to GST Funding, GST USA and GST by means of
a notice given in accordance with the provisions of this Section 6(c), which
address initially is, with respect to the Placement Agents, the address set
forth in the Placement Agreement; and (ii) if to GST Funding, initially at GST
Funding's address set forth in the Indenture and thereafter at such other
address, notice of which is given in accordance with the provisions of this
Section 6(c); and if to GST USA, initially at GST USA's address set forth in the
Indenture and thereafter at such other address, notice of which is given in
accordance with the provisions of this Section 6(c); and if to GST, initially at
GST's address set forth in the Indenture and thereafter at such other address,
notice of which is given in accordance with the provisions of this Section 6(c).
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 deposited in the mail, postage prepaid, 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.
Copies of all such notices, demands, or other communications
shall be concurrently delivered by the person giving the same to the Trustee, at
the address specified in the Indenture.
(d) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and be binding upon the successors, assigns and transferees of each
of the parties, including, without limitation and without the need for an
express assignment, subsequent Holders; PROVIDED that nothing herein shall be
deemed to permit any assignment, transfer or other disposition of Registrable
Notes in violation of the terms of the Placement Agreement. If any transferee of
any Holder shall acquire Registrable Notes, in any manner, whether by operation
of law or otherwise, such Registrable Notes shall be held subject to all of the
terms of this Agreement, and by taking and holding such Registrable Notes such
person shall be conclusively deemed to have agreed to be bound by and to perform
all of the terms and provisions of this Agreement and such person shall be
entitled to receive the benefits hereof. The Placement Agents (in their capacity
as Placement Agents) shall have no liability or obligation to GST Funding, GST
USA or GST with respect to any failure by a Holder to comply with, or any breach
by any Holder of, any of the obligations of such Holder under this Agreement.
(e) PURCHASES AND SALES OF NOTES. GST Funding, GST USA and GST
shall not, and shall use their best efforts to cause their affiliates (as
defined in Rule 405 under the 0000 Xxx) not to, purchase and then resell or
otherwise transfer any Notes.
(f) RATING OF NOTES. GST Funding, GST USA and GST shall cause
the Notes or the Exchange Notes, as the case may be, to be rated by Xxxxx'x
Investors Service, Inc. or Standard & Poor's Corporation within 18 months of the
Closing Date.
(g) THIRD PARTY BENEFICIARY. The Holders shall be third party
beneficiaries to the agreements made hereunder between GST Funding, GST USA and
GST, on the one hand,
17
and the Placement Agents, on the other hand, and each Holder shall have the
right to enforce such agreements directly to the extent it deems such
enforcement necessary or advisable to protect its rights or the rights of
Holders hereunder.
(h) 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.
(i) HEADINGS. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(j) DESIGNATION OF PROCESS AGENT; SUBMISSION TO JURISDICTION.
Each of GST Funding, GST USA and GST hereby (i) acknowledges that it has
irrevocably designated and appointed Xxxxxx Xxxxxxxx Frome & Xxxxxxxxxx LLP, 000
Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxx Xxxxx, Esq. (together
with any successor, the "Process Agent"), as its authorized agent upon which
process may be served in any suit, action or proceeding arising out of or
relating to this Agreement or the transactions contemplated herein that may be
instituted in any federal or state court in the State of New York, or brought
under federal or state securities laws, and acknowledges that the Process Agent
has accepted such designation, (ii) agrees that service of process upon the
Process Agent and written notice of such service to GST Funding, GST USA or GST,
as the case may be (mailed or delivered to GST's Chief Executive Officer at its
principal office at 4317 N.E. Xxxxxxxx Way, Vancouver, Washington 98662), shall
be deemed in every respect effective service of process upon GST Funding, GST
USA or GST, as the case may be, in any such suit, action or proceeding and (iii)
agrees to take any and all action, including the execution and filing of any and
all such documents and instruments as may be necessary to continue such
designation and appointment of the Process Agent in full force and effect so
long as any of the Notes shall be outstanding. Each of GST Funding, GST USA and
GST hereby agrees to submit to the nonexclusive jurisdiction of any federal or
state court in the State of New York in any such suit, action or proceeding
arising out of or relating to this Agreement or the transactions contemplated
herein.
(k) WAIVER OF IMMUNITY. To the extent that GST has or
hereafter may acquire any immunity from jurisdiction of any court or from any
legal process (whether through service of notice, attachment prior to judgment,
attachment in aid of execution, execution or otherwise) with respect to itself
or its property, it hereby irrevocably waives such immunity in respect of its
obligations under this Agreement, to the extent permitted by law.
(l) GOVERNING LAW. This Agreement shall be governed by the
laws of the State of New York.
(m) SEVERABILITY. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be affected or impaired thereby.
18
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
GST TELECOMMUNICATIONS, INC.
By /s/ Xxxxxxx Xxxxx
---------------------------------
Name: Xxxxxxx Xxxxx
Title: Vice Chairman and Secretary
GST USA, INC.
By /s Xxxxxxx Xxxxx
---------------------------------
Name: Xxxxxxx Xxxxx
Title: Senior Vice President
GST EQUIPMENT FUNDING, INC.
By /s Xxxxxxx Xxxxx
---------------------------------
Name: Xxxxxxx Xxxxx
Title: Senior Vice President
Confirmed and accepted as
of the date first above written:
XXXXXX XXXXXXX & CO. INCORPORATED
XXXXXX, READ & CO. INC.
TD SECURITIES (USA) INC.
By Xxxxxx Xxxxxxx & Co. Incorporated
By /s/ Xxxxx Xxxxx
---------------------------------
Name: Xxxxx Xxxxx
Title: Vice President
