EXECUTION VERSION
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REGISTRATION RIGHTS AGREEMENT
Dated as of March 7, 1997
Among
CONTIFINANCIAL CORPORATION
and
BEAR, XXXXXXX & CO. INC.,
and
CREDIT SUISSE FIRST BOSTON CORPORATION
as Initial Purchasers
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$200,000,000
7 1/2% SENIOR NOTES DUE 2002
REGISTRATION RIGHTS AGREEMENT (this "Agreement"),
dated as of March 7, 1997, between CONTIFINANCIAL
CORPORATION, a Delaware corporation (the "Company"), and
BEAR, XXXXXXX & CO. INC. and CREDIT SUISSE FIRST BOSTON
CORPORATION (the "Initial Purchasers").
This Agreement is being entered into in connection with the Purchase
Agreement, dated the date hereof, between the Company and the Initial Purchasers
(the "Purchase Agreement"), which provides for the sale by the Company to the
Initial Purchasers of $200,000,000 aggregate principal amount of the Company's 7
1/2% Senior Notes Due 2002 (the "Notes"). In order to induce the Initial
Purchasers to enter into the Purchase Agreement, the Company has agreed to
provide the registration rights set forth in this Agreement for the benefit of
the Initial Purchasers and their direct and indirect transferees. The execution
and delivery of this Agreement is a condition to the obligation of the Initial
Purchasers to purchase the Notes under the Purchase Agreement.
The parties hereby agree as follows:
SECTION 1. Definitions. As used in this Agreement, the following
terms shall have the following meanings:
"Additional Interest" shall have the meaning set forth in Section
4(a) hereof.
"Advice" shall have the meaning set forth in the last paragraph of
Section 5 hereof.
"Agreement" shall have the meaning set forth in the first
introductory paragraph hereto.
"Applicable Period" shall have the meaning set forth in Section 2(b)
hereof.
"Closing Date" shall mean the Closing Date set forth in the Purchase
Agreement.
"Company" shall have the meaning set forth in the first introductory
paragraph hereto.
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"Effectiveness Date" shall mean, with respect to any Registration
Statement, the 90th day after the Filing Date with respect thereto.
"Effectiveness Period" shall have the meaning set forth in Section
3(a) hereof.
"Event Date" shall have the meaning set forth in Section 4(b)
hereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the SEC promulgated thereunder.
"Exchange Notes" shall have the meaning set forth in Section 2(a)
hereof.
"Exchange Offer" shall have the meaning set forth in Section 2(a)
hereof.
"Exchange Registration Statement" shall have the meaning set forth
in Section 2(a) hereof.
"Filing Date" shall mean (a) if no Registration Statement has been
filed by the Company pursuant to this Agreement, the 30th day after the
Issue Date; provided, however, that if a Shelf Notice is given within 10
days of the Filing Date, then the Filing Date with respect to the initial
Shelf Registration shall be the 15th calendar day after the date of the
giving of such Shelf Notice; and (b) in each other case (which may be
applicable notwithstanding the consummation of the Exchange Offer), the
30th day after the delivery of a Shelf Notice.
"Holder" shall mean any holder of a Registrable Note or Registrable
Notes.
"Indemnified Person" shall have the meaning set forth in Section
7(c) hereof.
"Indemnifying Person" shall have the meaning set forth defined in
Section 7(c) hereof.
"Indenture" shall mean the Indenture, dated as of March 1, 1997,
between the Company and The Chase Manhattan Bank, as trustee, pursuant to
which the Notes
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are being issued, as amended or supplemented from time to time in
accordance with the terms thereof.
"Initial Purchasers" shall have the meaning set forth in the first
introductory paragraph hereto.
"Inspectors" shall have the meaning set forth in Section 5(o)
hereof.
"Issue Date" shall mean the date on which the original Notes were
soldto the Initial Purchasers pursuant to the Purchase Agreement.
"Majority Holders" shall have the meaning set forth in Section 3(c)
hereof.
"NASD" shall have the meaning set forth in Section 5(s) hereof.
"Notes" shall have the meaning set forth in the second introductory
paragraph hereto.
"Participant" shall have the meaning set forth in Section 7(a)
hereof.
"Participating Broker-Dealer" shall have the meaning set forth in
Section 2(b) hereof.
"Person" shall mean an individual, trustee, corporation,
partnership, limited liability company, joint stock company, trust,
unincorporated association, union, business association, firm or other
legal entity.
"Private Exchange" shall have the meaning set forth in Section 2(b)
hereof.
"Private Exchange Notes" shall have the meaning set forth in Section
2(b) hereof.
"Prospectus" shall mean the prospectus included in any Registration
Statement (including any prospectus subject to completion and a prospectus
that includes any information previously omitted from a prospectus filed
as part of an effective registration statement in reliance upon Rule 430A
promulgated under the
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Securities Act), as amended or supplemented by any prospectus supplement,
and all other amendments and supplements to the Prospectus, with respect
to the terms of the offering of any portion of the Registrable Notes
covered by such Registration Statement including posteffective amendments,
and all material incorporated by reference or deemed to be incorporated by
reference in such Prospectus.
"Purchase Agreement" shall have the meaning set forth in the second
introductory paragraph hereto.
"Records" shall have the meaning set forth in Section 5(o) hereof.
"Registrable Notes" shall mean each Note upon original issuance of
the Notes and at all times subsequent thereto, each Exchange Note as to
which Section 2(c)(iv) 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) a Registration Statement (other than, with
respect to any Exchange Note as to which Section 2(c)(iv) hereof is
applicable, the Exchange Registration Statement) covering such Note,
Exchange Note or Private Exchange Note, as the case may be, has been
declared effective by the SEC and such Note (unless such Note was not
tendered for exchange by the Holder thereof), Exchange Note or Private
Exchange Note, as the case may be, has been disposed of in accordance with
such effective Registration Statement, (ii) such Note, Exchange Note or
Private Exchange Note, as the case may be, could be sold in compliance
with Rule 144(k), or (iii) such Note, Exchange Note or Private Exchange
Note, as the case may be, ceases to be outstanding for purposes of the
Indenture.
"Registration Statement" shall mean any registration statement of
the Company, including, but not limited to, the Exchange Registration
Statement, that covers any of the Registrable Notes pursuant to the
provisions of this Agreement, including the Prospectus, amendments and
supplements to such
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registration statement, including posteffective amendments, all exhibits,
and all material incorporated by reference or deemed to be incorporated by
reference in such registration statement.
"Rule 144" shall mean Rule 144 promulgated under the Securities Act,
as such Rule may be amended from time to time, or any similar rule (other
than Rule 144A) or regulation hereafter adopted by the SEC providing for
offers and sales of securities made in compliance therewith resulting in
offers and sales by subsequent holders that are not affiliates of an
issuer of such securities being free of the registration and prospectus
delivery requirements of the Securities Act.
"Rule 144A" shall mean Rule 144A promulgated under the Securities
Act, as such Rule may be amended from time to time, or any similar rule
(other than Rule 144) or regulation hereafter adopted by the SEC.
"Rule 415" shall mean Rule 415 promulgated under the Securities Act,
as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the SEC.
"SEC" shall mean the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933 and the rules
and regulations of the SEC promulgated thereunder.
"Shelf Notice" shall have the meaning set forth in Section 2(c)
hereof.
"Shelf Registration" shall have the meaning set forth in Section
3(a) hereof.
"TIA" shall mean the Trust Indenture Act of 1939, as amended.
"Trustee" shall mean the trustee under the Indenture and, if
existent, the trustee under any indenture governing the Exchange Notes and
Private Exchange Notes (if any).
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"Underwritten registration or underwritten offering" shall mean a
registration in which securities of the Company are sold to an underwriter
for reoffering to the public.
SECTION 2. Exchange Offer. (a) The Company agrees to file with the
SEC no later than the Filing Date an offer to exchange (the "Exchange Offer")
any and all of the Registrable Notes (other than the Private Exchange Notes, if
any) for a like aggregate principal amount of debt securities of the Company,
which are identical in all material respects to the Notes (the "Exchange Notes")
(and which are entitled to the benefits of the Indenture or a trust indenture
which is identical in all material respects to the Indenture (other than such
changes to the Indenture or any such identical trust indenture as are necessary
to comply with any requirements of the SEC to effect or maintain the
qualification thereof under the TIA) and which, in either case, has been
qualified under the TIA), except that the Exchange Notes (other than Private
Exchange Notes, if any) (i) shall have been registered pursuant to an effective
Registration Statement under the Securities Act, (ii) shall contain no
restrictive legend thereon and (iii) shall not contain any requirement by the
Company to pay Additional Interest (other than with respect to periods prior to
the issuance of such Exchange Notes). The Exchange Offer shall be registered
under the Securities Act on the appropriate form (the "Exchange Registration
Statement") and shall comply with all applicable tender offer rules and
regulations under the Exchange Act. The Company agrees to use its best efforts
to (x) cause the Exchange Registration Statement to be declared effective under
the Securities Act on or before the Effectiveness Date; (y) keep the Exchange
Offer open for at least 30 calendar days (or longer if required by applicable
law) after the date that notice of the Exchange Offer is mailed to Holders; and
(z) consummate the Exchange Offer on or prior to the 150th day following the
Issue Date. If after such Exchange Registration Statement is declared effective
by the SEC, the Exchange Offer or the issuance of the Exchange Notes thereunder
is interfered with by any stop order, injunction or other order or requirement
of the SEC or any other governmental agency or court, such Exchange Registration
Statement shall be deemed not to have become effective for purposes of this
Agreement. Each Holder who participates in the Exchange Offer will be required
to represent that any Exchange Notes
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received by it will be acquired in the ordinary course of its business, that at
the time of the consummation of the Exchange Offer such Holder will have no
arrangement or understanding with any Person to participate in the distribution
of the Exchange Notes in violation of the provisions of the Securities Act, and
that such Holder is not an affiliate of the Company within the meaning of the
Securities Act. Upon consummation of the Exchange Offer in accordance with this
Section 2, the Company shall have no further obligation to register Registrable
Notes (other than Private Exchange Notes and other than in respect of any
Exchange Notes as to which clause 2(c)(iv) hereof applies) pursuant to Section 3
hereof. No securities other than the Exchange Notes shall be included in the
Exchange Registration Statement.
(b) The Company shall include within the Prospectus contained in the
Exchange Registration Statement a section entitled "Plan of Distribution",
reasonably acceptable to the Initial Purchasers, which shall contain a summary
statement of the positions taken or policies made by the Staff of the SEC with
respect to the potential "underwriter" status of any broker-dealer that is the
beneficial owner (as defined in Rule 13d-3 under the Exchange Act) of Exchange
Notes received by such broker-dealer in the Exchange Offer (a "Participating
Broker-Dealer"), whether such positions or policies have been publicly
disseminated by the Staff of the SEC or such positions or policies, in the
judgment of counsel for the Initial Purchasers, represent the prevailing views
of the Staff of the SEC. Such "Plan of Distribution" section shall also
expressly permit the use of the Prospectus by all Persons subject to the
prospectus delivery requirements of the Securities Act, including all
Participating Broker-Dealers, and include a statement describing the means by
which Participating Broker-Dealers may resell the Exchange Notes.
If any Participating Broker-Dealer participates in the Exchange
Offer and notifies the Company or causes the Company to be notified in writing
that it is a Participating Broker-Dealer prior to or on the last date for which
exchanges are accepted pursuant to the Exchange Offer, the Company shall use its
reasonable efforts to keep the Exchange Registration Statement effective and to
amend and supplement the Prospectus contained therein, in order to
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permit such Prospectus to be lawfully delivered by any Participating
Broker-Dealer subject to the prospectus delivery requirements of the Securities
Act for such period of time as is necessary to comply with applicable law in
connection with any resale of the Exchange Notes; provided, however, that such
period shall not exceed 180 days after the last date for which exchanges are
accepted pursuant to the Exchange Offer (or such shorter period when all
Exchange Notes received by Participating Broker-Dealers in exchange for
Registrable Notes acquired for their own account as a result of market-making or
other trading activities have been disposed of by such Participating
Broker-Dealers or such longer period if extended pursuant to the last paragraph
of Section 5 hereof) (the "Applicable Period"); and Participating Broker-Dealers
shall not be authorized by the Company to, and shall not, deliver such
Prospectus after such period in connection with resales contemplated by this
Section 2(b) or otherwise.
If, prior to the last date for which exchanges are accepted pursuant
to the Exchange Offer, the Initial Purchasers hold any Notes acquired by them
and having the status of an unsold allotment in the initial distribution, the
Company shall, upon the request of any of the Initial Purchasers, simultaneously
with the delivery of the Exchange Notes in the Exchange Offer issue and deliver
to the Initial Purchasers in exchange (the "Private Exchange") for such Notes
held by the Initial Purchasers a like principal amount of debt securities of the
Company that are identical in all material respects to the Exchange Notes (the
"Private Exchange Notes") (and which are issued pursuant to the same indenture
as the Exchange Notes) except for the placement of a restrictive legend on such
Private Exchange Notes. The Private Exchange Notes shall, to the extent
permitted, bear the same CUSIP number as the Exchange Notes.
Interest on the Exchange Notes and the Private Exchange Notes will
accrue from the last interest payment date on which interest was paid on the
Notes surrendered in exchange therefor or, if no interest has been paid on the
Notes, from the Issue Date.
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In connection with the Exchange Offer, the Company shall:
(i) mail to each Holder a copy of the Prospectus forming part of the
Exchange Registration Statement, together with an appropriate letter of
transmittal and related documents;
(ii) utilize the services of a depositary for the Exchange Offer
with an address in the Borough of Manhattan, The City of New York;
(iii) permit Holders to withdraw tendered Notes at any time prior to
the close of business, New York time, on the last business day on which
the Exchange Offer shall remain open; and
(iv) otherwise comply in all material respects with all applicable
laws, rules and regulations.
As soon as practicable after the close of the Exchange Offer or the
Private Exchange, as the case may be, the Company shall:
(i) accept for exchange all Notes tendered and not validly withdrawn
pursuant to the Exchange Offer or the Private Exchange;
(ii) deliver to the Trustee for cancelation all Notes so accepted
for exchange; and
(iii) cause the Trustee to authenticate and deliver promptly to each
Holder of Notes, either Exchange Notes or Private Exchange Notes, as the
case may be, equal in principal amount to the Notes of such Holder so
accepted for exchange.
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 (A) the Exchange
Notes shall not be subject to the transfer restrictions applicable to the Notes
or the requirement of the Company to pay Additional Interest thereon and (B) the
Private Exchange Notes shall be subject to the transfer restrictions applicable
to the Notes. The Indenture or such indenture
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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 none of the
Exchange Notes, the Private Exchange Notes or the Notes will have the right to
vote or consent as a separate class on any matter.
(c) If (i) because of any change in law or in currently prevailing
interpretations of the Staff of the SEC, the Company is not permitted to effect
an Exchange offer, (ii) the Exchange Offer is not consummated within 150 days of
the Issue Date, (iii) any holder of Private Exchange Notes so requests at any
time after the consummation of the Private Exchange or (iv) in the case of any
Holder that participates in the Exchange Offer, such Holder does not receive
Exchange Notes on the date of the exchange that may be sold without restriction
under federal securities laws (other than due solely to the status of such
Holder as an affiliate of the Company within the meaning of the Securities Act),
then the Company shall promptly deliver written notice thereof (the "Shelf
Notice") to the Trustee and, in the case of clauses (i) and (ii), all Holders,
in the case of clause (iii), the Holders of the Private Exchange Notes and, in
the case of clause (iv), the affected Holder, and shall file a Shelf
Registration pursuant to Section 3 hereof.
SECTION 3. Shelf Registration. If a Shelf Notice is delivered as
contemplated by Section 2(c) hereof, then:
(a) Shelf Registration. The Company shall file with the SEC prior to
the Filing Date a Registration Statement for an offering to be made on a
continuous basis pursuant to Rule 415 covering all the Registrable Notes (the
"Shelf Registration"). The Shelf Registration shall be on Form S-3 or another
appropriate form permitting registration of such Registrable Notes for resale by
Holders in the manner or manners designated by them. The Company shall not
permit any securities other than the Registrable Notes to be included in the
Shelf Registration.
The Company shall use its best efforts to cause the Shelf
Registration to be declared effective under the Securities Act on or prior to
the Effectiveness Date and shall use its reasonable efforts to keep the Shelf
Registration continuously effective under the Securities Act until the date
which is two years from the Issue Date,
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subject to extension pursuant to the last paragraph of Section 5 hereof (the
"Effectiveness Period"), or such shorter period ending when all Registrable
Notes covered by the Shelf Registration have been sold in the manner set forth
and as contemplated in the Shelf Registration.
(b) Withdrawal of Stop Orders. If the Shelf Registration ceases to
be effective for any reason at any time during the Effectiveness Period (other
than because of the sale of all the securities registered thereunder), the
Company shall use its best efforts to obtain the prompt withdrawal of any order
suspending the effectiveness thereof.
(c) Supplements and Amendments. The Company shall promptly
supplement and amend the Shelf Registration if required by the rules,
regulations or instructions applicable to the registration form used for such
Shelf Registration, if required by the Securities Act, or if reasonably
requested by the Holders of a majority in aggregate principal amount (the
"Majority Holders") of the Registrable Notes covered by such Registration
Statement or by any underwriter of such Registrable Notes.
SECTION 4. Additional Interest. (a) The Company and the Initial
Purchasers agree that the Holders of Registrable Notes will suffer damages if
the Company fails to fulfill its obligations under Section 2 or Section 3 hereof
and that it would not be feasible to ascertain the extent of such damages with
precision. Accordingly, the Company agrees to pay, as liquidated damages,
additional interest on the Notes ("Additional Interest") under the circumstances
and to the extent set forth below:
(i) if (A) neither the Exchange Registration Statement nor the Shelf
Registration has been filed on or prior to the applicable Filing Date or
(B) notwithstanding that the Company has consummated or will consummate an
Exchange Offer, the Company is required to file a Shelf Registration
Statement and such Shelf Registration Statement is not filed on or prior
to the Filing Date applicable thereto, then, commencing on the day after
the Filing Date applicable thereto, Additional Interest shall accrue on
the Notes over and above the stated interest at a rate of 0.50% per annum;
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(ii) if (A) neither the Exchange Registration Statement nor the
Shelf Registration is declared effective by the SEC on or prior to the
relevant Effectiveness Date or (B) notwithstanding that the Company has
consummated or will consummate the Exchange Offer, the Company is required
to file a Shelf Registration and such Shelf Registration is not declared
effective by the SEC on or prior to the Effectiveness Date in respect of
such Shelf Registration, then, commencing on the day after such
Effectiveness Date, Additional Interest shall accrue on the Notes included
or which should have been included in such Registration Statement over and
above the stated interest at a rate of 0.50% per annum; and
(iii) if (A) the Company has not exchanged Exchange Notes for all
Notes validly tendered in accordance with the terms of the Exchange Offer
on or prior to the 150th day after the Issue Date or (B) the Exchange
Registration Statement ceases to be effective at any time prior to the
time that the Exchange Offer is consummated or (C) if applicable, the
Shelf Registration has been declared effective and such Shelf Registration
ceases to be effective at any time during the Effectiveness Period, then
Additional Interest shall accrue (over and above any interest otherwise
payable on such Notes) at a rate of 0.50% per annum on (x) the 151st day
after the Issue Date with respect to the Notes validly tendered and not
exchanged by the Company, in the case of (A) above, or (y) the day the
Exchange Registration Statement ceases to be effective in the case of (B)
above, or (z) the day such Shelf Registration ceases to be effective in
the case of (C) above (it being understood and agreed that, notwith
standing any provision to the contrary, so long as any Note which is the
subject of a Shelf Notice is then covered by an effective Shelf
Registration Statement, no Additional Interest shall accrue on such Note);
provided, however, that the Additional Interest rate on any affected Note may
not exceed at any one time in the aggregate 0.50% per annum; and provided
further that (1) upon the filing of the Exchange Registration Statement or a
Shelf Registration (in the case of clause (i) of this Section 4(a)), (2) upon
the effectiveness of the Exchange Registration Statement or the Shelf
Registration (in the
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case of clause (ii) of this Section 4(a)), or (3) upon the exchange of Exchange
Notes for all Notes tendered and not validly withdrawn (in the case of clause
(iii)(A) of this Section 4(a)), or upon the effectiveness of the Exchange
Registration Statement which had ceased to remain effective (in the case of
(iii)(B) of this Section 4(a)), or upon the effectiveness of the Shelf
Registration which had ceased to remain effective (in the case of (iii)(C) of
this Section 4(a)), Additional Interest on the affected Notes as a result of
such clause (or the relevant subclause thereof), as the case may be, shall cease
to accrue.
(b) The Company shall notify the Trustee within three business days
after each and every date on which an event occurs in respect of which
Additional Interest is required to be paid (an "Event Date"). Any amounts of
Additional Interest due pursuant to clauses (a)(i), (a)(ii) or (a)(iii) of this
Section 4 will be payable to the Holders of affected Notes in cash semiannually
on each March 15 and September 15 (to the holders of record on the March 1 and
September 1 immediately preceding such dates), commencing with the first such
date occurring after any such Additional Interest commences to accrue. The
amount of Additional Interest will be determined by multiplying the applicable
Additional Interest rate by the principal amount of the affected Registrable
Notes of such Holders, multiplied by a fraction, the numerator of which is the
number of days such Additional Interest rate was applicable during such period
(determined on the basis of a 360-day year comprised of twelve 30-day months
and, in the case of a partial month, the actual number of days elapsed), and the
denominator of which is 360.
SECTION 5. Registration Procedures. In connection with the filing of
any Registration Statement pursuant to Sections 2 or 3 hereof, the Company shall
effect such registration(s) to permit the sale of the securities covered thereby
in accordance with the intended method or methods of disposition thereof, and
pursuant thereto and in connection with any Registration Statement filed by the
Company hereunder, the Company shall:
(a) prepare and file with the SEC prior to the Filing Date a
Registration Statement or Registration Statements as prescribed by
Sections 2 or 3 hereof, to use its best efforts to cause each such
Registration
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Statement to become effective and to use its reasonable efforts to cause
such Registration Statement to remain effective as provided herein;
provided, however, that, if (i) such filing is pursuant to Section 3
hereof, or (ii) a Prospectus contained in an Exchange Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to
sell Exchange Notes during the Applicable Period, before filing any
Registration Statement or Prospectus or any amendments or supplements
thereto, the Company shall, if requested, furnish to and afford the
Holders of the Registrable Notes covered by such Registration Statement or
each such Participating Broker-Dealer, as the case may be, one counsel
selected by the Majority Holders (the "Majority Counsel") and the managing
underwriters of an underwritten offering (and their counsel, if any) of
Registrable Notes, if any, a reasonable opportunity to review copies of
all such documents (including copies of any documents to be incorporated
by reference therein and all exhibits thereto) proposed to be filed (in
each case at least five business days prior to such filing). The Company
shall not file any Registration Statement or Prospectus or any amendments
or supplements thereto in respect of which the Holders must be afforded an
opportunity to review prior to the filing of such document, if the
Majority Holders of the Registrable Notes covered by such Registration
Statement, or any such Participating Broker-Dealer, as the case may be,
the Majority Counsel, or the managing underwriters (or their counsel, if
any), if any, shall reasonably object;
(b) prepare and file with the SEC such amendments and posteffective
amendments to each Shelf Registration or Exchange Registration Statement,
as the case may be, as may be necessary to keep such Registration
Statement continuously effective for the Effectiveness Period or the
Applicable Period or until consummation of the Exchange Offer, as the case
may be; cause the related Prospectus to be supplemented by any Prospectus
supplement required by applicable law, and as so sup plemented to be filed
pursuant to Rule 424 (or any similar provisions then in force) under the
Securities Act; and comply with the provisions of the Securities Act and
the Exchange Act applicable to it with respect
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to the disposition of all securities covered by such Registration
Statement as so amended or in such Prospectus as so supplemented and with
respect to the subsequent resale of any securities being sold by a
Participating Broker-Dealer covered by any such Prospectus; the Company
will be deemed not to have used its reasonable efforts to cause the
Exchange Offer Registration Statement or any Shelf Registration Statement,
as the case may be, to remain effective during the Applicable Period or
the Effectiveness Period, as the case may be, if the Company voluntarily
takes any action that would result in the Holder of Registrable Notes
covered thereby or Participating Broker-Dealers seeking to sell Exchange
Notes not being able to sell such Registrable Notes or Exchange Notes, as
the case may be, during that period unless (i) such action is, in the
reasonable judgment of the Company, required by applicable law (including
any interpretation of the SEC) or (ii) such action is taken by the Company
in good faith and for valid business reasons (not including avoidance of
the Company's obligations hereunder), including the acquisition or
divestiture of assets, so long as the Company promptly complies with the
requirements of Section 5(k) hereof and the last paragraph of this Section
5;
(c) if (i) a Shelf Registration is filed pursuant to Section 3
hereof, or (ii) a Prospectus contained in an Exchange Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to
sell Exchange Notes during the Applicable Period, notify the selling
Holders of Registrable Notes, or each such Participating Broker-Dealer, as
the case may be, the Majority Counsel and the managing underwriters of an
underwritten offering of Registrable Notes and their counsel, if any,
promptly (but in any event within three business days) (A) when a
Prospectus or any supplement thereto or posteffective amendment has been
filed, and, with respect to a Registration Statement or any posteffective
amendment, when the same has become effective under the Securities Act
(includ ing in such notice a written statement that any Holder may, upon
request, obtain, at the sole expense of the Company, one conformed copy of
such Registration Statement or posteffective amendment including
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financial statements and schedules, documents incorporated or deemed to be
incorporated by reference and exhibits), (B) of the issuance by the SEC of
any stop order suspending the effectiveness of a Registration Statement or
of any order preventing or suspending the use of any preliminary
prospectus or the initiation of any proceedings for that purpose, (C) if
at any time when a prospectus is required by the Securities Act to be
delivered in connection with sales of the Registrable Notes or resales of
Exchange Notes by Participating Broker-Dealers upon written notice by any
such Participating Broker-Dealer of a resale, the representations and
warranties of the Company contained in any agreement (including any
underwriting agreement), contemplated by Section 5(n) hereof cease to be
true and correct, (D) of the receipt by the Company of any notification
with respect to the suspension of the qualification or exemption from
qualification of a Registration Statement or any of the Registrable Notes
or the Exchange Notes to be sold by any Participating Broker-Dealer for
offer or sale in any jurisdiction, or the initiation or threatening of any
proceeding for such purpose, (E) of the happening of any event, the
existence of any condition or any information becoming known that makes
any statement made in such Registration Statement or related Prospectus or
any document incorporated or deemed to be incorporated therein by
reference untrue in any material respect or that requires the making of
any changes in or amendments or supplements to such Reg istration
Statement, Prospectus or documents so that, in the case of the
Registration Statement, it will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, and
that in the case of the Prospectus, it will not contain any untrue
statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading, and (F)
of the determination by the Company that a posteffective amendment to a
Registration Statement would be appropriate;
(d) use its reasonable efforts to obtain the with drawal of any
order suspending the effectiveness of the
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Registration Statement or the qualification (or exemption from
qualification) of any of the Registrable Notes or the Exchange Notes for
sale in any jurisdiction as soon as practicable;
(e) if a Shelf Registration is filed pursuant to Section 3 and if
requested by the managing underwriter or underwriters (if any), or the
Holders of a majority in principal amount of the Registrable Notes being
sold in connection with an underwritten offering, (i) promptly incorporate
in a prospectus supplement or posteffective amendment such information as
the managing underwriter or underwriters (if any), such Holders, or
counsel for any of them reasonably request to be included therein, (ii)
make all required filings of such prospectus supplement or such
posteffective amendment as soon as practicable after the Company has
received notification of the matters to be incorporated in such prospectus
supplement or posteffective amend ment, and (iii) supplement or make
amendments to such Registration Statement;
(f) if (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in an Exchange Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to
sell Exchange Notes during the Applicable Period, furnish to each selling
Holder of Registrable Notes and to each such Participating Broker-Dealer
who so requests, to the Majority Counsel and to each managing underwriter
of an underwritten public offering of Registrable Notes and their counsel,
if any, at the sole expense of the Company, one conformed copy of the
Registration Statement or Registration Statements and each posteffective
amendment thereto, including financial statements and schedules, and, if
requested, all documents incorporated or deemed to be incorporated therein
by reference and all exhibits;
(g) if (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in an Exchange Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to
sell Exchange Notes during the Applicable
18
Period, deliver to each selling Holder of Registrable Notes, or each such
Participating Broker-Dealer, as the case may be, the Majority Counsel, and
to the underwriters, if any, and such underwriters' counsel, at the sole
expense of the Company, as many copies of the Prospectus or Prospectuses
(including each form of preliminary prospectus) and each amendment or
supplement thereto and any documents incorporated by reference therein as
such Persons may reasonably request; and, subject to the last paragraph of
this Section 5, the Company hereby consents to the use of such Prospectus
and each amendment or supplement thereto by each of the selling Holders of
Registrable Notes or each such Participating Broker-Dealer, as the case
may be, and the underwriters or agents, if any, and dealers (if any), in
connection with the offering and sale of the Registrable Notes covered by,
or the sale by Participating Broker-Dealers of the Exchange Notes pursuant
to, such Prospectus and any amendment or supplement thereto;
(h) prior to any public offering of Registrable Notes or any
delivery of a Prospectus contained in the Exchange Registration Statement
by any Participating Broker-Dealer who seeks to sell Exchange Notes during
the Applicable Period, use its reasonable efforts to register or qualify
such Registrable Notes (and to cooperate with selling Holders of
Registrable Notes or each such Participating Broker-Dealer, as the case
may be, the Majority Counsel, the managing underwriter or underwriters, if
any, and such underwriters' counsel in connection with the registration or
qualification (or exemption from such registration or qualification) of
such Registrable Notes) for offer and sale under the securities or Blue
Sky laws of such jurisdictions within the United States as any selling
Holder, Participating Broker-Dealer, or the managing underwriter or
underwriters of an underwritten offering of Registrable Notes shall
reasonably request in writing; provided, however, that where Exchange
Notes held by Participating Broker-Dealers or Registrable Notes are
offered other than through an underwritten offering, the Company agrees to
cause its counsel to perform Blue Sky investigations and file
registrations and qualifications required to be filed pursuant to this
Section 5(h); keep each such registration or
19
qualification (or exemption therefrom) effective during the period such
Registration Statement is required to be kept effective and do any and all
other acts or things reasonably necessary or advisable to enable the
disposition in such jurisdictions of the Exchange Notes held by
Participating Broker-Dealers or the Registrable Notes covered by the
applicable Registration Statement; provided, however, that the Company
shall not be required to (A) qualify generally to do business in any
jurisdiction where it is not then so qualified, (B) take any action that
would subject it to general service of process in any such jurisdiction
where it is not then so subject or (C) subject itself to taxation in
excess of a nominal dollar amount in any such jurisdiction where it is not
then so subject;
(i) if a Shelf Registration is filed pursuant to Section 3 hereof,
cooperate with the selling Holders of Registrable Notes and the managing
underwriter or underwriters, if any, to facilitate the timely preparation
and delivery of certificates representing Registrable Notes to be sold,
which certificates shall not bear any restrictive legends (except any
customary legend borne by securities held through The Depository Trust
Company or any similar depository) and shall be in a form eligible for
deposit with The Depository Trust Company; and enable such Registrable
Notes to be in such denominations (consistent with the provisions of the
Indenture and the officers' certificate establishing the form and terms of
the Notes pursuant to the Indenture) and registered in such names as the
managing underwriter or underwriters, if any, or Holders may reasonably
request;
(j) use its reasonable efforts to cause the Regis trable Notes
covered by the Registration Statement to be registered with or approved by
such other governmental agencies or authorities as may be necessary to
enable the Holders thereof or the underwriter or underwriters, if any, to
dispose of such Registrable Notes, except as may be required solely as a
consequence of the nature of a selling Holder's business, in which case
the Company will cooperate in all reasonable respects with the filing of
such Registration Statement and the granting of such approvals;
20
(k) if (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in an Exchange Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to
sell Exchange Notes during the Applicable Period, upon the occurrence of
any event contemplated by paragraph 5(c)(ii)(E) or 5(c)(ii)(F) hereof, as
promptly as practicable prepare and (subject to Section 5(a) hereof) file
with the SEC, at the sole expense of the Company, a supplement or
posteffective amendment to the Registration Statement or a supplement to
the related Prospectus or any document incorporated or deemed to be
incorporated therein by reference, or file any other required document so
that, as thereafter delivered to the purchasers of the Registrable Notes
being sold thereunder or to the purchasers of the Exchange Notes to whom
such Prospectus will be delivered by a Participating Broker-Dealer, any
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;
(l) use its reasonable efforts to cause the Regis trable Notes
covered by a Registration Statement or the Exchange Notes, as the case may
be, to be rated with the appropriate rating agencies, if so requested by
the Holders of a majority in aggregate principal amount of Registrable
Notes covered by such Registration Statement or the Exchange Notes, as the
case may be, or the managing underwriter or underwriters, if any;
(m) prior to the effective date of the first Registration Statement
relating to the Registrable Notes, (i) provide the Trustee with
certificates for the Registrable Notes or Exchange Notes, as the case may
be, in a form eligible for deposit with The Depository Trust Company and
(ii) provide a CUSIP number for the Registrable Notes or Exchange Notes,
as the case may be;
(n) in connection with any underwritten offering of Registrable
Notes pursuant to a Shelf Registration, negotiate in good faith and enter
into an underwriting
21
agreement, which shall be in form and scope as is customary in
underwritten offerings of debt securities with similar credit ratings to
the Notes and take all such other actions as are reasonably requested by
the managing underwriter or underwriters in order to facilitate the
registration or the disposition of such Registrable Notes and, in such
connection, (i) make such representations and warranties to, and covenants
with, the underwriters with respect to the business of the Company and its
subsidiaries and the Registration Statement, Prospectus and documents, if
any, incorporated or deemed to be incorporated by reference therein, in
each case, as are customarily made by issuers to underwriters in
underwritten offerings of debt securities with similar credit ratings to
the Notes, and confirm the same in writing if and when requested; (ii)
obtain the written opinion of counsel to the Company (which may be the
Company's General Counsel) and written updates thereof in form, scope and
substance reasonably satisfactory to the managing underwriter or
underwriters, addressed to the underwriters covering the matters
customarily covered in opinions requested in underwritten offerings of
debt securities with similar credit ratings to the Notes and such other
matters as may be reasonably requested by the managing underwriter or
underwriters; (iii) obtain "cold comfort" letters and updates thereof in
form, scope and substance reasonably satisfactory to the managing
underwriter or underwriters 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 are, or are required to be, included or incorporated by
reference in the Registration Statement), addressed to each of the
underwriters, such letters to be in customary form and covering matters of
the type customarily covered in "cold comfort" letters in connection with
underwritten offerings of debt securities with similar credit ratings to
the Notes and such other matters as reasonably requested by the managing
underwriter or underwriters; and (iv) if an underwriting agreement is
entered into, the same shall contain indemnification provisions and
procedures no less favorable than those set forth in Section 7 hereof (or
such other provisions
22
and procedures acceptable to the Majority Holders of Registrable Notes
covered by such Registration Statement and the managing underwriter or
underwriters or agents) with respect to all parties to be indemnified
pursuant to said Section. The above shall be done at the closing under
such underwriting agreement, or as and to the extent required thereunder;
(o) if (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in an Exchange Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to
sell Exchange Notes during the Applicable Period, and to the extent
customary in connection with a due diligence investigation for an offering
of debt securities with a similar credit rating, make available for
inspection by representatives approved by the Majority Holders of such
Registrable Notes being sold, or such Participating Broker-Dealers, as the
case may be, any underwriter participating in any such disposition of
Registrable Notes, if any, one counsel to the underwriters, if any
(collectively, the "Inspectors"), at the offices where normally kept,
during reasonable business hours, all financial and other records,
pertinent corporate documents and instruments of the Company and its
subsidiaries (collectively, the "Records") as shall be reasonably
necessary to enable them to exercise any applicable due diligence
responsibilities. Records which the Company determines, in good faith, to
be confidential and any Records which it notifies the Inspectors are
confidential shall not be disclosed by the Inspectors unless (i) the
disclosure of such Records is necessary to avoid or correct a misstatement
or omission in such Registration Statement, (ii) the release of such
Records is ordered pursuant to a subpoena or other order from a court of
competent jurisdiction, (iii) disclosure of such information is, in the
opinion of counsel for any Inspector, necessary or advisable in connection
with any action, claim, suit or proceeding, directly or indirectly,
involving or potentially involving such Inspector and arising out of,
based upon, relating to, or involving this Agreement, or any transactions
contemplated hereby or arising hereunder, or (iv) the information in such
Records has been made
23
generally available to the public. Each selling Holder of such Registrable
Securities and each such Participating Broker-Dealer will be required to
agree that information obtained by it as a result of such inspections
shall be deemed confidential and shall not be used by it as the basis for
any market transactions in the securities of the Company unless and until
such information is generally available to the public. Each selling Holder
of such Registrable Notes and each such Participating Broker-Dealer will
be required to further agree that it will, upon learning that disclosure
of such Records is sought in a court of competent jurisdiction, give
notice to the Company and allow the Company to undertake appropriate
action to prevent disclosure of the Records deemed confidential at the
Company's sole expense;
(p) provide an indenture trustee for the Registrable Notes or the
Exchange Notes, as the case may be, and use its reasonable efforts to
cause the Indenture or the trust indenture provided for in Section 2(a)
hereof, as the case may be, to be qualified under the TIA not later than
the effective date of the Exchange Offer or the first Registration
Statement relating to the Registrable Notes; and in connection therewith,
cooperate with the trustee under any such indenture and the Holders of the
Registrable Notes, to effect such changes to such indenture as may be
required for such indenture to be so qualified in accordance with the
terms of the TIA; and execute, and use its reasonable efforts to cause
such trustee to execute, all documents as may be required to effect such
changes, and all other forms and documents required to be filed with the
SEC to enable such indenture to be so qualified in a timely manner;
(q) comply with all applicable rules and regulations of the SEC and
make generally available to its securityholders earnings statements
satisfying the provisions of Section 11(a) of the Securities Act and Rule
158 thereunder (or any similar rule promulgated under the Securities Act)
no later than 45 days after the end of any 12-month period (or 90 days
after the end of any 12-month period if such period is a fiscal year) (i)
commencing at the end of any fiscal quarter in which Registrable Notes are
sold to underwriters in
24
a firm commitment or best efforts underwritten offering and (ii) if not
sold to underwriters in such an offering, commencing on the first day of
the first fiscal quarter of the Company after the effective date of a
Registration Statement, which statements shall cover said 12-month
periods;
(r) if an Exchange Offer or a Private Exchange is to be consummated,
upon delivery of the Registrable Notes by Holders to the Company (or to
such other Person as directed by the Company) in exchange for the Exchange
Notes or the Private Exchange Notes, as the case may be, the Company shall
xxxx, or cause to be marked, on such Registrable Notes that such
Registrable Notes are being canceled in exchange for the Exchange Notes or
the Private Exchange Notes, as the case may be; in no event shall such
Registrable Notes be marked as paid or otherwise satisfied;
(s) cooperate with each seller of Registrable Notes covered by any
Registration Statement and each underwriter, if any, participating in the
disposition of such Registrable Notes and their respective counsel in
connection with any filings required to be made with the National
Association of Securities Dealers, Inc. (the "NASD"); and
(t) use its reasonable efforts to take all other steps necessary or
advisable to effect the registration of the Registrable Notes covered by a
Registration Statement contemplated hereby.
The Company may require each seller of Registrable Notes as to which
any Registration is being effected to furnish to the Company such information
regarding such seller and the distribution of such Registrable Notes as the
Company may, from time to time, reasonably request. The Company may exclude from
such registration the Registrable Notes of any seller who unreasonably fails to
furnish such information within a reasonable time after receiving such request.
Each seller as to which any Shelf Registration 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 seller
not materially misleading.
25
Each Holder of Registrable Notes and each Partici pating
Broker-Dealer agrees by acquisition of such Registrable Notes or Exchange Notes
to be sold by such Participating Broker-Dealer, as the case may be, that, upon
actual receipt of any notice from the Company of the happening of any event of
the kind described in Section 5(c)(ii)(B), 5(c)(ii)(D), 5(c)(ii)(E), or
5(c)(ii)(F) hereof, such Holder will forthwith discontinue disposition of such
Registrable Notes covered by such Registration Statement or Prospectus or
Exchange Notes to be sold by such Holder or Participating Broker-Dealer, as the
case may be, until such Holder's or Participating Broker-Dealer's receipt of the
copies of the supplemented or amended Prospectus contemplated by Section 5(k)
hereof, or until it is advised in writing (the "Advice") by the Company that the
use of the applicable Prospectus may be resumed, and has received copies of any
amendments or supplements thereto. In the event the Company shall give any such
notice, each of the Effectiveness Period and the Applicable Period shall be
extended by the number of days during such periods from and including the date
of the giving of such notice to and including the date when each seller of
Registrable Notes covered by such Registration Statement or Exchange Notes to be
sold by such Participating Broker-Dealer, as the case may be, shall have
received (x) the copies of the supplemented or amended Prospectus contemplated
by Section 5(k) hereof or (y) the Advice.
SECTION 6. Registration Expenses. (a) All fees and expenses incident
to the performance of or compliance with this Agreement by the Company shall be
borne by the Company whether or not the Exchange Offer or a Shelf Registration
is filed or becomes effective, including (i) all registration and filing fees
(including (A) fees with respect to filings required to be made with the NASD in
connection with an underwritten offering and (B) fees and expenses of compliance
with state securities or Blue Sky laws (including reasonable fees and
disbursements of counsel in connection with Blue Sky qualifications of the
Registrable Notes or Exchange Notes and determination of the eligibility of the
Registrable Notes or Exchange Notes for investment under the laws of such
jurisdictions (x) where the holders of Registrable Notes are located, in the
case of the Exchange Notes, or (y) as provided in Section 5(h) hereof, in the
case of Registrable Notes or Exchange Notes to be sold by a Participating
Broker-Dealer during the
26
Applicable Period)), (ii) printing expenses, including expenses of printing
certificates for Registrable Notes or Exchange Notes in a form eligible for
deposit with The Depository Trust Company and of printing prospectuses if the
printing of prospectuses is requested by the managing underwriter or
underwriters, if any, by the Majority Holders of the Registrable Notes included
in any Registration Statement or sold by any Participating Broker-Dealer, as the
case may be, (iii) messenger, telephone and delivery expenses, (iv) fees and
disbursements of counsel for the Company and, subject to the provisions of
Section 6(b) hereof, reasonable fees and disbursements of counsel for the
Majority Holders of Registrable Notes, (v) fees and disbursements of all
independent certified public accountants referred to in Section 5(n)(iii) hereof
(including the expenses of any special audit and "cold comfort" letters required
by or incident to such performance), (vi) rating agency fees, if any, and any
fees associated with making the Registrable Notes or Exchange Notes eligible for
trading through The Depository Trust Company, (vii) Securities Act liability
insurance, if the Company desires such insurance, (viii) fees and expenses of
all other Persons retained by the Company, (ix) internal expenses of the Company
(including all salaries and expenses of officers and employees of the Company
performing legal or accounting duties), (x) the expense of any annual audit,
(xi) the fees and expenses incurred in connection with the listing of the
securities to be registered on any securities exchange, if applicable, and (xii)
the expenses relating to printing, word processing and distributing all
Registration Statements, any underwriting agreement, indentures and any other
documents necessary in order to comply with this Agreement.
(b) The Company shall (i) reimburse the Holders of the Registrable
Notes being registered pursuant to this Agreement for the reasonable fees and
disbursements, in an aggregate amount not to exceed $25,000, of not more than
one counsel (in addition to appropriate local counsel) chosen by the Majority
Holders of the Registrable Notes to be included in such Registration Statement
and (ii) reimburse out-of-pocket expenses (other than legal expenses) of Holders
of Registrable Notes incurred in connection with the registration and sale of
the Registrable Notes pursuant to a Shelf Registration or in connection with the
exchange of Registrable Notes pursuant to the Exchange Offer.
27
SECTION 7. Indemnification. (a) The Company agrees to indemnify and
hold harmless each Holder of Registrable Notes offered pursuant to a Shelf
Registration Statement and each Participating Broker-Dealer selling Exchange
Notes during the Applicable Period, the affiliates, directors, officers, agents,
representatives and employees of each such Person or its affiliates, and each
other Person, if any, who controls any such Person or its affiliates within the
meaning of either Section 15 of the Securities Act or Section 20(a) of the
Exchange Act (each, a "Participant"), from and against any and all losses,
liabilities, claims, damages and expenses whatsoever as incurred (including
reasonable attorneys' fees and any and all expenses whatsoever incurred in
investigating, preparing or defending against any litigation, commenced or
threatened, or any claim whatsoever, and any and all amounts paid in settlement
of any claim or litigation), joint or several, to which they or any of them may
become subject under the Act, the Exchange Act or otherwise, insofar as such
losses, liabilities, claims, damages or expenses (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue statement
of a material fact contained in any Registration Statement pursu ant to which
the offering of such Registrable Notes or Exchange Notes, as the case may be, is
registered, or in any supplement thereto or amendment thereof, or any related
Prospectus, or any supplement thereto or amendment thereof, or any related
preliminary Prospectus, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading; provided, however,
that the Company will not be liable to any Participant in any such case to the
extent but only to the extent that any such loss, liability, claim, damage or
expense arises out of or is based upon any such untrue statement or alleged
untrue statement or omission or alleged omission made therein in reliance upon
and in conformity with written information relating to such Participant
furnished to the Company in writing by or on behalf of such Participant
expressly for use therein; provided further, however, that such indemnity
agreement with respect to any preliminary Prospectus shall not inure to the
benefit of any Participant from whom the Person asserting any loss, liability,
claim, damage or expense purchased Registrable Notes or Exchange Notes, as the
case may be, if a copy of the Prospectus filed as part of an effective
Registration
28
Statement (as then amended or supplemented and furnished by the Company to such
Participant) was not sent or given by or on behalf of such Participant to such
Person, if such is required by law, at or prior to the sale of such Registrable
Notes or Exchange Notes, as the case may be, and if such Prospectus (as so
amended or supplemented) would have cured the defect giving rise to such loss,
liability, claim, damage or expense. This indemnity agreement will be in
addition to any liability which the Company may otherwise have, including under
this Agreement.
(b) Each Participant agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors and officers and each Person who
controls the Company within the meaning of Section 15 of the Securities Act or
Section 20(a) of the Exchange Act to the same extent as the foregoing indemnity
from the Company to each Participant, but only (i) with reference to information
relating to such Participant furnished to the Company in writing by or on behalf
of such Participant expressly for use in any Registration Statement or
Prospectus, any amendment or supplement thereto, or any preliminary prospectus
or (ii) with respect to any untrue statement or representation made by such
Participant in writing to the Company.
(c) Promptly after receipt by any Person in respect of which
indemnity may be sought under subsection (a) or (b) above of notice of the
commencement of any action, such Person (the "Indemnified Person") shall, if a
claim in respect thereof is to be made against the Person whom such indemnity
may be sought (the "Indemnifying Person") under such subsection, notify each
Indemnifying Person against whom indemnification is to be sought in writing of
the commencement thereof (but the failure so to notify an Indemnifying Person
shall not relieve it from any liability which it may have under paragraph (a) or
(b) above). In case any such action is brought against any Indemnified Person,
and it notifies an Indemnifying Person of the commencement thereof, the
Indemnifying Person will be entitled to participate therein, and to the extent
it may elect by written notice delivered to the Indemnified Person promptly
after receiving the aforesaid notice from such Indemnified Person, to assume the
defense thereof with counsel satisfactory to such Indemnified Person. Notwith
standing the foregoing, the Indemnified Person or parties
29
shall have the right to employ its or their own counsel in any such case, but
the fees and expenses of such counsel shall be at the expense of such
Indemnified Person or parties unless (i) the employment of such counsel shall
have been authorized in writing by one of the Indemnifying Persons in connection
with the defense of such action, (ii) the Indemnifying Persons shall not have
employed counsel to take charge of the defense of such action within a
reasonable time after notice of commencement of the action, or (iii) such
Indemnified Person or Persons shall have reasonably concluded that there may be
defenses available to it or them which are different from or additional to those
available to one or all of the Indemnifying Persons (in which case the
Indemnifying Persons shall not have the right to direct the defense of such
action on behalf of the Indemnified Person or Persons), in any of which events
such fees and expenses shall be borne by the Indemnifying Persons (it being
understood that the Indemnifying Person 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 fees and expenses of more than one separate firm of attorneys (in
addition to any local counsel) for all such Indemnified Persons). Anything in
this subsection to the contrary notwithstanding, an Indemnifying Person shall
not be liable for any settlement of any claim or action effected without its
written consent; provided, however, that such consent was not unreasonably
withheld.
(d) In order to provide for contribution in circumstances in which
the indemnification provided for in the preceding paragraphs of this Section 7
is for any reason held to be unavailable from any Indemnifying Person or is
insufficient to hold harmless an Indemnified Person thereunder, each
Indemnifying Person shall contribute to the aggregate losses, claims, damages,
liabilities and expenses of the nature contemplated by such indemnification
provision (including any investigation, legal and other expenses incurred in
connection with, and any amount paid in settlement of, any action, suit or
proceeding or any claims asserted, but after deducting in the case of losses,
claims, damages, liabilities and expenses suffered by the Company any
contribution received by the Company from persons, other than the Indemnified
Persons, who may also be liable for contribution, including persons who control
the Company
30
within the meaning of Section 15 of the Act or Section 20(a) of the Exchange
Act, officers and directors of the Company) as incurred to which the Indemnified
Party may be subject, in such proportions as is appropriate to reflect the
relative benefits received by the Indemnifying Person or Persons, on the one
hand, and the Indemnified Person or Persons on the other from the offering of
the Notes or, if such allocation is not permitted by applicable law or
indemnification is not available as a result of the Indemnifying Person not
having received notice as provided in the preceding paragraphs of this Section
7, in such proportion as is appropriate to reflect not only the relative
benefits referred to above but also the relative fault of the Indemnifying
Person or Persons, on the one hand, and the Indemnified Person or Persons on the
other in connection with the statements or omissions which resulted in such
losses, claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative fault of the parties shall be determined
by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company or the Participant
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The parties agree
that it would not be just and equitable if contribution pursuant to this
paragraph (d) were determined by pro rata allocation (even if the Participants
were treated as one entity for such purpose) or by any other method of
allocation which does not take account of the equitable considerations referred
to above. Notwithstanding the provisions of this paragraph (d), (i) in no case
shall a Participant be required to contribute any amount in excess of the amount
by which proceeds received by such Participant from sales of Registrable Notes
or Exchange Securities, as the case may be, exceeds the amount of damages that
such Participant has otherwise been required to pay or has paid by reason of
such untrue statement or alleged untrue statement or omission or alleged
omission, and (ii) no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. Any party
entitled to contribution will, promptly after receipt of notice of commencement
of any action, suit or proceeding against such party in respect of which a claim
31
for contribution may be made against another party or parties, notify each party
or parties from whom contribution may be sought, but the omission to so notify
such party or parties shall not relieve the party or parties from whom
contribution may be sought from any obligation it or they may have under this
paragraph (d) or otherwise. No party shall be liable for contribution with
respect to any action or claim settled without its consent; provided, however,
that such consent was not unreasonably withheld.
SECTION 8. Rule 144 and Rule 144A. The Company covenants that it
will file the reports required to be filed by it under the Securities Act and
the Exchange Act and the rules and regulations adopted by the SEC thereunder in
a timely manner in accordance with the requirements of the Securities Act and
the Exchange Act and, if at any time the Company is not required to file such
reports, it will, upon the request of any Holder of Registrable Notes, make pub
licly available annual reports and such information, documents and other reports
of the type specified in Sections 13 and 15(d) of the Exchange Act. The Company
further covenants for so long as any Registrable Notes remain outstanding, to
make available to any Holder or beneficial owner of Registrable Notes in
connection with any sale thereof and any prospective purchaser of such
Registrable Notes from such Holder or beneficial owner the information required
by Rule 144A(d)(4) under the Securities Act in order to permit resales of such
Registrable Notes pursuant to Rule 144A.
SECTION 9. Underwritten Registration. If any of the Registrable
Notes covered by any Shelf Registration are to be sold in an underwritten
offering, the investment banker or investment bankers and manager or managers
that will manage the offering will be selected by the Majority Holders of such
Registrable Notes included in such offering and reasonably acceptable to the
Company.
No Holder of Registrable Notes may participate in any underwritten
registration hereunder unless such Holder (a) agrees to sell such Holder's
Registrable Notes on the basis provided in any underwriting arrangements
approved by the Persons entitled hereunder to approve such arrangements and (b)
completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other
32
documents required under the terms of such underwriting arrangements.
SECTION 10. Miscellaneous. (a) No Inconsistent Agreements. The
Company has not entered, as of the date hereof, and the Company will not, after
the date of this Agreement, enter into any agreement with respect to any of its
securities that is inconsistent with the rights granted to the Holders of
Registrable Notes in this Agreement or otherwise conflicts with the provisions
hereof. The Company has not entered and the Company will not enter into any
agreement with respect to any of its securities which will grant to any Person
piggy-back registration rights with respect to a Registration Statement.
(b) Adjustments Affecting Registrable Notes. The Company will not,
directly or indirectly, take any action with respect to the Registrable Notes as
a class that would adversely affect the ability of the Holders of Registrable
Notes to include such Registrable Notes in a registration undertaken pursuant to
this Agreement.
(c) Amendments and Waivers. The provisions of this Agreement may not
be amended, modified or supplemented, and waivers or consents to departures from
the provisions hereof may not be given, otherwise than with the prior written
consent of the Holders of not less than a majority in aggregate principal amount
of the then outstanding Registrable Notes. Notwithstanding the foregoing, a
waiver or consent to depart from the provisions hereof with respect to a matter
that relates exclusively to the rights of Holders of Registrable Notes whose
securities are being sold pursuant to a Registration Statement and that does not
directly or indirectly affect, impair, limit or compromise the rights of other
Holders of Registrable Notes may be given by Holders of at least a majority in
aggregate principal amount of the Registrable Notes being sold by such Holders
pursuant to such Registration Statement; provided, however, that the provisions
of this sentence may not be amended, modified or supplemented except in
accordance with the provisions of the immediately preceding sentence.
(d) Notices. All notices and other communications (including any
notices or other communica tions to the Trustee) provided for or permitted
hereunder
33
shall be made in writing by hand-delivery, registered first-class mail, next-day
air courier or facsimile:
(i) if to a Holder of the Registrable Notes or any Participating
Broker-Dealer, at the most current address of such Holder or Participating
Broker-Dealer, as the case may be, set forth on the records of the
registrar under the Indenture, with a copy in like manner to the Initial
Purchasers as follows:
Bear, Xxxxxxx & Co. Inc.
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No: (000) 000-0000
Attention: Xxxxxxx Xxxxxxx, 0xx Xxxxx
Credit Suisse First Boston Corporation
00 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No.: (000) 000-0000
Attention: Investment Banking Department --
Transactions Advisory Group
with a copy to:
Cravath, Swaine & Xxxxx
Worldwide Plaza
000 Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No: (000) 000-0000
Attention: Xxxx X. Xxxxxxxxxx
(ii) if to the Initial Purchasers, at the address
specified in Section 10(d)(i);
(iii) if to the Company, as follows:
ContiFinancial Corporation
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No.: (000) 000-0000
Attention: General Counsel
34
with copies to:
Xxxxx Xxxxxxxxxx
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No: (000) 000-0000
Attention: Xxxx Xxxxx
All such notices and communications shall be deemed to have been
duly given: when delivered by hand, if personally delivered; five business days
after being deposited in the mail, postage prepaid, if mailed; one business day
after being timely delivered to a next-day air courier; and when receipt is
acknowledged by the addressee, if sent by facsimile.
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 and in the manner specified in such Indenture.
(e) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the parties
hereto; provided, however, that this Agreement shall not inure to the benefit of
or be binding upon a successor or assign of a Holder unless and to the extent
such successor or assign holds Registrable Notes.
(f) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(g) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(h) Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York, as applied to contracts
made and performed wholly within the State of New York, without regard to
principles of conflicts of law.
35
(i) Severability. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their best efforts to find and employ an alternative means to
achieve the same or substantially the same result as that contemplated by such
term, provision, covenant or restriction. It is hereby stipulated and declared
to be the intention of the parties that they would have executed the remaining
terms, provisions, covenants and restrictions without including any of such that
may be hereafter declared invalid, illegal, void or unenforceable.
(j) Notes Held by the Company or Its Affiliates. Whenever the
consent or approval of Holders of a specified percentage of Registrable Notes is
required hereunder, Registrable Notes held by the Company or its affiliates (as
such term is defined in Rule 405 under the Securities Act) shall not be counted
in determining whether such consent or
36
approval was given by the Holders of such required percentage.
(k) Third-Party Beneficiaries. Holders of Registrable Notes and
Participating Broker-Dealers are intended third-party beneficiaries of this
Agreement and this Agreement may be enforced by such Persons.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first above written.
CONTIFINANCIAL CORPORATION,
by /s/Xxxxxx X. Xxxxxxx
----------------------------------------
Name: Xxxxxx X. Xxxxxxx
Title: Senior Vice
President and
Chief Financial
Officer
by /s/Xxxxx X. X'Xxxxxxx
----------------------------------------
Name: Xxxxx X. X'Xxxxxxx
Title: Vice President and
Controller
BEAR, XXXXXXX & CO. INC.,
by /s/Xxxxx X. Xxxxx
----------------------------------------
Name: Xxxxx X. Xxxxx
Title: Senior Managing
Director
CREDIT SUISSE FIRST BOSTON
CORPORATION,
by /s/Xxxxxx Xxxxxxx
----------------------------------------
Name: Xxxxxx Xxxxxxx
Title: Director
