Exhibit 10.6
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "AGREEMENT") is made and entered
into as of July 27, 2006, among WCA Waste Corporation, a Delaware corporation
(the "COMPANY"), and Ares Corporate Opportunities Fund II, L.P. (the
"PURCHASER").
WHEREAS, the parties have agreed to enter into this Agreement in
connection with, and as a condition to the Closing under, the Preferred Stock
Purchase Agreement, dated as of June 12, 2006, between the Company and the
Purchaser (the "PURCHASE AGREEMENT") and the related documents entered into in
connection therewith (the "TRANSACTION DOCUMENTS"); and
WHEREAS, pursuant to the Purchase Agreement and concurrently with the
execution of this Agreement, the Purchaser is acquiring from the Company shares
of the Company's Series A Convertible Preferred Stock, par value $0.01 per share
("PREFERRED STOCK"), that are convertible into shares of the Company's common
stock, par value $0.01 per share ("COMMON STOCK").
NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in this
Agreement, and for other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the Company and the Purchaser agree
as follows:
1. Definitions. In addition to the terms defined elsewhere in this
Agreement, (a) capitalized terms that are not otherwise defined herein have the
meanings given to such terms in the Purchase Agreement, and (b) the following
terms have the meanings indicated:
"DEMAND REGISTRATION STATEMENT" means a Registration Statement filed
or to be filed pursuant to a written Purchaser Request pursuant to either
Section 2 or Section 3.
"HOLDER" means a holder of Registrable Securities acquired in
accordance with the Stockholder's Agreement; provided that with respect to
the inclusion of Registrable Securities in a Registration Statement,
"Holders" shall only include those holders of Registrable Securities
designated by the Purchaser.
"PIGGY-BACK REGISTRATION STATEMENT" means a Registration Statement
filed or to be filed pursuant to which the Company has received one or
more written requests to participate pursuant to Section 4.
"PURCHASER REQUEST" means a request from the Purchaser, either on
its behalf or on behalf of Holders that in the aggregate possess a
majority of the Registrable Securities outstanding as of the date of such
request.
"PROSPECTUS" means the prospectus included in a Registration
Statement (including, without limitation, a prospectus that includes any
information previously omitted from a prospectus filed as part of an
effective Registration Statement in reliance upon Rules 430A, 430B or 430C
promulgated under the Securities Act of 1933, as amended (the "Securities
Act")), as amended or supplemented by any prospectus supplement, with
respect to the terms of the offering of any portion of the Registrable
Securities covered by a Registration Statement, and all other amendments
and
supplements to the Prospectus, including post-effective amendments,
and all material incorporated by reference or deemed to be incorporated by
reference in such Prospectus.
"REGISTRABLE SECURITIES" means any Common Stock into which the
Preferred Stock issued pursuant to the Transaction Documents has been
converted, together with any securities issued or issuable upon any stock
split, dividend or other distribution, recapitalization or similar event
with respect to the foregoing; provided that such shares will cease to be
"Registrable Securities" (i) when they have been sold to or through a
broker or dealer or underwriter in a distribution to the public or
otherwise on or through the facilities of the national securities
exchange, national securities association or automated quotation system on
which the Company's capital stock is listed, (ii) when a registration
statement with respect to the sale of such shares has become effective
under the Securities Act , and such shares have been disposed of in
accordance with such registration statement, or (iii) at such time as the
Holder of Registrable Securities is entitled to sell all of its
Registrable Securities within three (3) months under Rule 144(k) of the
Securities Act without restriction.
"REGISTRATION STATEMENT" shall mean any registration statement to be
filed under the Exchange Act, which covers any of the Registrable
Securities pursuant to the provisions of this Agreement, including the
Prospectus included therein, all amendments and supplements to such
Registration Statement, including pre- and post-effective amendments, all
exhibits and all material incorporated by reference or deemed to be
incorporated by reference in such Registration Statement.
"RULE 144," "RULE 415," "RULE 424" and "RULE 461" means Rule 144,
Rule 415, Rule 424 and Rule 461, respectively, promulgated by the
Commission pursuant to the Securities Act, as such Rules may be amended
from time to time, or any similar rule or regulation hereafter adopted by
the Commission having substantially the same effect as such Rule.
"SHELF REGISTRATION STATEMENT" means a Registration Statement filed
or to be filed pursuant to a written Purchaser Request pursuant to Section
2.
"STOCKHOLDER'S AGREEMENT" means the Stockholder's Agreement of even
date herewith by and between the Company and the Purchaser.
2. Shelf Registration. If the Preferred Stock shall have previously
been converted into Registrable Securities, then the Company shall, within ten
(10) days of the receipt thereof, give written notice of such request to all
Holders and, subject to the limitations of Section 2(b) below, shall prepare and
file (as expeditiously as practicable, and in any event within thirty (30) days
of the receipt of any other such request) with the Commission a "Shelf"
Registration Statement covering the resale of all Registrable Securities for an
offering to be made on a continuous basis pursuant to Rule 415. Such
Registration Statement shall be on Form S-3 (except if the Company is not then
eligible to register for resale the Registrable Securities on Form S-3, in which
case such registration shall be on another appropriate form in accordance
herewith as the Designated Holders may consent) and shall contain (except if
otherwise directed by the Designated Holders) the "Plan of Distribution"
attached hereto as Annex A. The
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Company shall use its commercially reasonable efforts to cause such Registration
Statement to be declared effective under the Securities Act as promptly as
possible after the filing thereof, and in any event within sixty (60) days of
the Purchaser Request (or one hundred twenty (120) days in the event the SEC has
determined to review the applicable Registration Statement) and shall, subject
to notice from the Company under Section 9(f), use its commercially reasonable
efforts to keep such Registration Statement continuously effective under the
Securities Act for the period that such Registration Statement may be kept
effective under applicable SEC regulations until the earlier of (i) the date on
which all Registrable Securities are eligible for sale under paragraph (k) of
Rule 144 without any volume, manner of sale or other restrictions and (ii) when
all Registrable Securities covered by such Registration Statement have been sold
(the "EFFECTIVENESS PERIOD"). The Company shall notify each Holder in writing
promptly (and in any event within one Trading Day) after receiving notification
from the Commission that a Registration Statement has been declared effective.
Notwithstanding the foregoing, the Company shall not be obligated to
file a Registration Statement pursuant to this Section 2 (i) during the 90 day
period commencing on the effective date of any other registration statement
filed by the Company relating to the public offering of its Common Stock or
securities convertible into Common Stock (other than on Forms S-4 or S-8 or any
successor thereto) or (ii) if the Company shall furnish to the Holders a
certificate signed by the chief executive officer of the Company stating that,
in the good faith judgment of the Board of Directors of the Company, the Board
has determined to file a registration statement relating to the public offering
of its Common Stock or securities convertible into Common Stock (other than on
Forms S-4 or S-8 or any successor thereto) within 30 days of the Purchaser
Request, during the period commencing on the date of such notice and ending upon
the earliest of (i) effectiveness of such registration statement , (ii) a
decision by the Company not to pursue effectiveness of such registration
statement or (iii) 90 days after the filing of such registration statement;
provided, however, that in the case of clause (ii) the Company may not utilize
this right more than once in any twelve (12) month period; provided, further,
that, for the avoidance of doubt, this clause (ii) shall be incremental to, and
not in lieu of, the Company's relief from its shelf registration obligation
under clause (i) above.
Notwithstanding the foregoing, if the Company shall furnish to the
Holders a certificate signed by the chief executive officer of the Company
stating that, in the good faith judgment of the Board of Directors of the
Company, maintaining a Registration Statement's effectiveness would be
materially detrimental to the Company and its stockholders for such Registration
Statement to remain effective by reason of a material pending or imminently
prospective transaction or development and it is therefore essential to suspend
such Registration Statement's effectiveness, the Company shall have the right to
suspend such effectiveness for a period of not more than sixty (60) days in
aggregate after receipt of the Purchaser Request; provided, however, that the
Company may not utilize this right more than twice in any twelve (12) month
period.
3. Demand Registration.
(a) If at any time the Company shall receive a written Purchaser
Request that the Company file a Registration Statement under the Securities Act,
then the Company shall, within ten (10) days of the receipt thereof, give
written notice of such request to all Holders and,
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subject to the limitations of Section 3(b) below, shall file (as expeditiously
as practicable, and in any event within thirty (30) days of the receipt of such
request) and use its commercially reasonable commercially reasonable efforts to
have declared effective, a Registration Statement under the Securities Act with
respect to all Registrable Securities which the Holders request to be registered
within ten (10) days of the mailing of such notice by the Company in accordance
with Section 8(g) below.
(b) If the Holders intend to distribute the Registrable Securities
covered by their request by means of an underwriting, they shall so advise the
Company as a part of their request made pursuant to this Section 3 and the
Company shall include such information in the written notice referred to in
Section 3(a). In such event, the right of any Holder to include such Holder's
Registrable Securities in such registration shall be conditioned upon such
Holder's participation in such underwriting and the inclusion of such Holder's
Registrable Securities in the underwriting (unless otherwise mutually agreed by
a majority in interest of the Holders participating in the underwriting and such
Holder) to the extent provided herein. A majority in interest of the Holders of
Registrable Securities participating in the underwriting, in consultation with
the Company, shall select the managing underwriter or underwriters in such
underwriting. All Holders proposing to distribute their securities through such
underwriting shall (together with the Company as provided in Section 5(l)) enter
into an underwriting agreement in customary form with the underwriter or
underwriters so selected for such underwriting by a majority in interest of such
Holders; provided, however, that no Holder (or any of their assignees) shall be
required to make any representations, warranties or indemnities except as they
relate to such Holder's ownership of shares and authority to enter into the
underwriting agreement and to such Holder's intended method of distribution, and
the liability of such Holder shall be limited to an amount equal to the net
proceeds from the offering received by such Holder. Notwithstanding any other
provision of this Section 3, if the underwriter advises a Holder that marketing
factors require a limitation of the number of shares to be underwritten, then
the Holder shall so advise the Company and the Company shall so advise all
Holders of Registrable Securities which would otherwise be underwritten pursuant
hereto, and the number of shares of Registrable Securities that may be included
in the underwriting shall be allocated as follows: (i) first, among holders of
Registrable Securities that have elected to participate in such underwritten
offering, in proportion (as nearly as practicable) to the aggregate amount of
Registrable Securities held by all such holders, until such holders have
included in the underwriting all shares requested by such holders to be
included, and (ii) thereafter, among all other holders of Common Stock, if any,
that have the right and have elected to participate in such underwritten
offering, in proportion (as nearly as practicable) to the amount of shares of
Common Stock owned by such holders. Without the consent of a majority in
interest of the Holders of Registrable Securities participating in a
registration referred to in Section 3(a), no securities other than Registrable
Securities shall be covered by such registration if the inclusion of such other
securities would result in a reduction of the number of Registrable Securities
covered by such registration or included in any underwriting or if, in the
opinion of the managing underwriter, the inclusion of such other securities
would adversely impact the marketing of such offering.
(c) The Company shall be obligated to effect only two (2)
registrations (and only if such registration would include Registrable
Securities with an aggregate value of at least ten million dollars
($10,000,000), calculated using the closing price of the Company's Common Shares
on the Trading Market on the date preceding the date of the Purchaser Request)
pursuant
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to Purchaser Requests under this Section 3 (an offering which is not consummated
shall not be counted for this purpose).
(d) Notwithstanding the foregoing, the Company shall not be
obligated to file a Registration Statement pursuant to this Section 3 (i) during
the 90 day period commencing on the effective date of any other registration
statement filed by the Company relating to the public offering of its Common
Stock or securities convertible into Common Stock (other than on Forms S-4 or
S-8 or any successor thereto) or (ii) if the Company shall furnish to the
Holders a certificate signed by the chief executive officer of the Company
stating that, in the good faith judgment of the Board of Directors of the
Company, the Board has determined to file a registration statement relating to
the public offering of its Common Stock or securities convertible into Common
Stock (other than on Forms S-4 or S-8 or any successor thereto) within 30 days
of the Purchaser Request, during the period commencing on the date of such
notice and ending upon the earliest of (i) effectiveness of such registration
statement , (ii) a decision by the Company not to pursue effectiveness of such
registration statement or (iii) 90 days after the filing of such registration
statement; provided, however, that in the case of clause (ii) the Company may
not utilize this right more than once in any twelve (12) month period; provided,
further, that, for the avoidance of doubt, this clause (ii) shall be incremental
to, and not in lieu of, the Company's relief from its demand registration
obligation under clause (i) above.
(e) Notwithstanding the foregoing, if the Company shall furnish to
the Holders a certificate signed by the chief executive officer of the Company
stating that, in the good faith judgment of the Board of Directors of the
Company, maintaining a Registration Statement's effectiveness would be
materially detrimental to the Company and its stockholders for such Registration
Statement to remain effective by reason of a material pending or imminently
prospective transaction or development and it is therefore essential to suspend
such Registration Statement's effectiveness, the Company shall have the right to
suspend such effectiveness for a period of not more than sixty (60) days in
aggregate after receipt of the Purchaser Request; provided, however, that the
Company may not utilize this right more than twice in any twelve (12) month
period.
4. Piggy-Back Registrations.
(a) If (but without any obligation to do so) the Company proposes to
register (including for this purpose a registration effected by the Company for
stockholders other than the Purchaser and its affiliates) any of its Common
Shares under the Securities Act in connection with the public offering of such
securities solely for cash (other than a registration on Form S-8 (or similar or
successor form) relating solely to the sale of securities to participants in a
Company stock plan or to other compensatory arrangements to the extent
includable on Form S-8 (or similar or successor form), or a registration on Form
S-4 (or similar or successor form)), the Company shall, at such time, promptly
give each Holder written notice of such registration. Upon the written request
of each Holder received by the Company within ten (10) Trading Days after
mailing of such notice by the Company in accordance with Section 9(f), the
Company shall use its commercially reasonable efforts to cause to be registered
under the Securities Act all of the Registrable Securities that each such Holder
(the "ELECTING HOLDERS") has requested to be registered ; provided that (i) if
such registration involves an underwritten offering to the public, all holders
of Registrable Securities requesting to be included in the Company's
registration must
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sell their Registrable Securities to the underwriters selected by the Company on
the same terms and conditions as apply to the Company or other selling
stockholders; and (ii) if, at any time after giving notice of the Company's
intention to register any securities pursuant to this Section 4 and prior to the
effective date of the registration statement filed in connection with such
registration, the Company shall determine for any reason not to register such
securities, the Company shall give written notice to all holders of Registrable
Securities and, thereupon, shall be relieved of its obligation to register any
Registrable Securities in connection with such registration (but not from any
obligation of the Company to pay the Registration Expenses in connection
therewith), without prejudice, however, to the rights of holders under Section
3. The Company shall have no obligation under this Section 4 to make any
offering of its securities, or to complete an offering of its securities that it
proposes to make.
(b) If such registration involves an underwritten offering to the
public, if the managing underwriter of the underwritten offering shall inform
the Company by letter of the underwriter's opinion that the number of
Registrable Securities requested to be included in such registration would, in
its opinion, materially adversely affect such offering, including the price at
which such securities can be sold, and the Company has so advised the requesting
Holders in writing, then the Company shall include in such registration, to the
extent of the number that the Company is so advised can be sold in (or during
the time of) such offering, (i) first, all securities proposed by the Company to
be sold for its own account, then (ii) to the extent that the number of shares
of Common Stock proposed to be sold by the Company or the other holders pursuant
to Section 4(a) is less than the number of shares of Common Stock that the
Company has been advised can be sold in such offering without having the
material adverse effect referred to above, such Registrable Securities requested
to be included in such registration pursuant to this Section 4 and such other
securities covered by registration rights, allocated pro rata among such
requesting Holders and the holders of such other rights in proportion, as nearly
as practicable, to the respective amounts of such securities requested to be
included in such registration. All other stockholders of the Company shall be
excluded from the proposed offering before any requesting Holder or holder of
other registration rights is required to reduce his, hers or its shares being
offered under the registration statement.
5. Demand Registration Procedures. In connection with the Company's
registration obligations hereunder with respect to a Demand Registration
Statement, the Company shall:
(a) Not less than three Trading Days prior to the filing of each
Demand Registration Statement or any related Prospectus or any amendment or
supplement thereto, the Company shall (i) furnish to the Holders and to one
counsel to the Holders ("Purchaser Counsel") copies of all such documents
proposed to be filed, which documents will be subject to the review of such
Holders and Purchaser Counsel, and (ii) cause its officers and directors,
counsel and independent certified public accountants to respond to such
inquiries as shall be necessary, in the reasonable opinion of respective
counsel, to conduct a reasonable investigation within the meaning of the
Securities Act. The Company shall not file such Demand Registration Statement or
any related Prospectus, amendments or supplements thereto to which the Holders
of a majority of the Registrable Securities and Purchaser Counsel shall
reasonably object.
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(b) (i) Prepare and file with the Commission such amendments,
including post-effective amendments, to each Demand Registration Statement and
the Prospectus used in connection therewith as may be necessary to keep such
Demand Registration Statement continuously effective as to the applicable
Registrable Securities for the Effectiveness Period in the case of a Shelf
Registration Statement, and until the end of the related offering in the case of
any other Demand Registration Statement, and prepare and file with the
Commission such additional Registration Statements in order to register for
resale under the Securities Act all of the Registrable Securities; (ii) cause
the related Prospectus to be amended or supplemented by any required Prospectus
supplement, and as so supplemented or amended to be filed pursuant to Rule 424;
(iii) respond as promptly as reasonably possible, and in any event within ten
(10) Trading Days, to any comments received from the Commission with respect to
any Registration Statement or any amendment thereto and as promptly as
reasonably possible provide the Holders and Purchaser Counsel true and complete
copies of all correspondence from and to the Commission relating to a
Registration Statement; and (iv) comply in all material respects with the
provisions of the Securities Act and the Exchange Act with respect to the
disposition of all Registrable Securities covered by a Demand Registration
Statement during the applicable period in accordance with the intended methods
of disposition by the Holders thereof set forth in the applicable Demand
Registration Statement as so amended or in such Prospectus as so supplemented.
(c) Notify the Holders of Registrable Securities to be sold pursuant
to a Demand Registration Statement and Purchaser Counsel as promptly as
reasonably possible, and (if requested by any such Person) confirm such notice
in writing no later than one Trading Day thereafter, of any of the following
events: (i) the Commission notifies the Company whether there will be a "review"
of any Demand Registration Statement; (ii) the Commission comments in writing on
any Demand Registration Statement (in which case the Company shall deliver to
each Holder a copy of such comments and of all written responses thereto); (iii)
any Demand Registration Statement or any post-effective amendment thereto is
declared effective; (iv) the Commission or any other Federal or state
governmental authority requests any amendment or supplement to a Demand
Registration Statement or Prospectus or requests additional information related
thereto; (v) the Commission issues any stop order suspending the effectiveness
of any Demand Registration Statement or initiates any Proceedings for that
purpose; (vi) the Company receives notice of any suspension of the qualification
or exemption from qualification of any Registrable Securities for sale in any
jurisdiction, or the initiation or threat of any Proceeding for such purpose; or
(vii) the financial statements included in any Demand Registration Statement
become ineligible for inclusion therein or any statement made in any Demand
Registration Statement or related Prospectus or any document incorporated or
deemed to be incorporated therein by reference is untrue in any material respect
or any revision to a Demand Registration Statement, related Prospectus or other
document is required so that it will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading.
(d) Use its commercially reasonable efforts to avoid the issuance of
or, if issued, obtain the withdrawal of (i) any order suspending the
effectiveness of any Demand Registration Statement or (ii) any suspension of the
qualification (or exemption from qualification) of any of the Registrable
Securities for sale in any jurisdiction, at the earliest practicable moment.
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(e) Furnish to each Holder and Purchaser Counsel, without charge, at
least one conformed copy of each Demand Registration Statement and each
amendment thereto, including financial statements and schedules, and all
exhibits to the extent requested by such Person (excluding those previously
furnished or incorporated by reference) promptly after the filing of such
documents with the Commission.
(f) Promptly deliver to each Holder and Purchaser Counsel, without
charge, as many copies of the Prospectus or Prospectuses (including each form of
prospectus) related to a Demand Registration Statement and each amendment or
supplement thereto as such Persons may reasonably request. The Company hereby
consents to the use of such Prospectus and each amendment or supplement thereto
by each of the selling Holders in connection with the offering and sale of the
Registrable Securities covered by such Prospectus and any amendment or
supplement thereto.
(g) In the time and manner required by each Trading Market, if at
all, prepare and file with such Trading Market an additional shares listing
application covering all of the Registrable Securities; (ii) take all steps
necessary to cause such Registrable Securities to be approved for listing on
each Trading Market as soon as reasonably practicable thereafter; (iii) to the
extent available to the Company, provide to the Purchaser evidence of such
listing; and (iv) maintain the listing of such Registrable Securities on each
such Trading Market.
(h) Prior to any public offering of Registrable Securities pursuant
to a Demand Registration Statement, use its commercially reasonable efforts to
register or qualify or cooperate with the selling Holders and Purchaser Counsel
in connection with the registration or qualification (or exemption from such
registration or qualification) of such Registrable Securities for offer and sale
under the securities or Blue Sky laws of such jurisdictions within the United
States as any Holder requests in writing, to keep each such registration or
qualification (or exemption therefrom) effective during the Effectiveness Period
in the case of a Shelf Registration Statement, and until the offering is
completed in the case of any other Demand Registration Statement, and to do any
and all other acts or things necessary or advisable to enable the disposition in
such jurisdictions of the Registrable Securities covered by a Demand
Registration Statement.
(i) Cooperate with the Holders to facilitate the timely preparation
and delivery of certificates representing Registrable Securities to be delivered
to a transferee pursuant to a Demand Registration Statement, which certificates
shall be free, to the extent permitted by the Purchase Agreement, of all
restrictive legends, and to enable such Registrable Securities to be in such
denominations and registered in such names as any such Holders may request.
(j) Upon the occurrence of any event described in Section 5(c)(vii),
as promptly as reasonably possible, prepare a supplement or amendment, including
a post-effective amendment, to such a Demand Registration Statement or a
supplement to the related Prospectus or any document incorporated or deemed to
be incorporated therein by reference, and file any other required document so
that, as thereafter delivered, neither such Demand Registration Statement nor
its related Prospectus will 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.
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(k) Cooperate with any due diligence investigation undertaken by the
Holders in connection with the sale of Registrable Securities pursuant to a
Demand Registration Statement, including without limitation by making available
any documents and information.
(l) If Holders of a majority of the Registrable Securities being
offered pursuant to a Demand Registration Statement select underwriters for the
offering, the Company shall enter into and perform its obligations under an
underwriting agreement, in usual and customary form, including, without
limitation, by providing customary legal opinions, comfort letters and
indemnification and contribution obligations.
(m) In the event of any underwritten public offering, enter into and
perform its obligations under an underwriting agreement, in usual and customary
form, with the managing underwriter of such offering.
(n) Comply with all applicable rules and regulations of the
Commission.
(o) The Company shall not be required to deliver any document
pursuant to any provision of this Section 5 to any Holder that is not selling
Registrable Securities under the applicable Demand Registration Statement. The
Company shall also not be required to deliver any document pursuant to any
provision of this Section 5, other than Section 5(f), to any Holder that
proposes to sell Registrable Securities with less than $500,000 in aggregate
offering price to the public under the Demand Registration Statement (based on
the last sale price per Common Share on the Trading Market on the Trading Day
preceding the date of the Purchaser Request).
6. Piggy-Back Registration Procedures. In connection with the
Company's registration obligations hereunder with respect to a Piggy-Back
Registration Statement, the Company shall:
(a) Not less than three Trading Days prior to the filing of each
Piggy-Back Registration Statement or any related Prospectus or any amendment or
supplement thereto (i) furnish to the Electing Holders and Purchaser Counsel
copies of all such documents proposed to be filed, and (ii) cause its officers
and directors, counsel and independent certified public accountants to respond
to such inquiries as shall be necessary, in the reasonable opinion of respective
counsel, to conduct a reasonable investigation within the meaning of the
Securities Act.
(b) (i) Cause the related Prospectus to be amended or supplemented
by any required Prospectus supplement, and as so supplemented or amended to be
filed pursuant to Rule 424; (ii) as promptly as reasonably possible provide the
Electing Holders and Purchaser Counsel true and complete copies of all
correspondence from and to the Commission relating to a Piggy-Back Registration
Statement; and (iii) comply in all material respects with the provisions of the
Securities Act and the Exchange Act with respect to the disposition of all
Registrable Securities covered by a Piggy-Back Registration Statement during the
offering.
(c) Notify the Electing Holders and Purchaser Counsel as promptly as
reasonably possible, and (if requested by any such Person) confirm such notice
in writing no later than one Trading Day thereafter, of any of the following
events: (i) the Commission notifies the Company whether there will be a "review"
of any Piggy-Back Registration Statement; (ii) the
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Commission comments in writing on any Piggy-Back Registration Statement (in
which case the Company shall deliver to each Electing Holder a copy of such
comments and of all written responses thereto); (iii) any Piggy-Back
Registration Statement or any post-effective amendment is declared effective;
(iv) the Commission or any other Federal or state governmental authority
requests any amendment or supplement to a Piggy-Back Registration Statement or
related Prospectus or requests additional information related thereto; (v) the
Commission issues any stop order suspending the effectiveness of any Piggy-Back
Registration Statement or initiates any Proceedings for that purpose; (vi) the
Company receives notice of any suspension of the qualification or exemption from
qualification of any Registrable Securities for sale in any jurisdiction, or the
initiation or threat of any Proceeding for such purpose; or (vii) the financial
statements included in any Piggy-Back Registration Statement become ineligible
for inclusion therein or any statement made in any Piggy-Back Registration
Statement or related Prospectus or any document incorporated or deemed to be
incorporated therein by reference is untrue in any material respect or any
revision to a Piggy-Back Registration Statement, related Prospectus or other
document is required so that it will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading.
(d) Furnish to each Electing Holder and Purchaser Counsel, without
charge, at least one conformed copy of each Piggy-Back Registration Statement
and each amendment thereto, including financial statements and schedules, and
all exhibits to the extent requested by such Person (excluding those previously
furnished or incorporated by reference) promptly after the filing of such
documents with the Commission.
(e) Promptly deliver to each Electing Holder and Purchaser Counsel,
without charge, as many copies of the Prospectus or Prospectuses (including each
form of prospectus) and each amendment or supplement thereto as such Persons may
reasonably request. The Company hereby consents to the use of such Prospectus
and each amendment or supplement thereto by each of the selling Electing Holders
in connection with the offering and sale of the Registrable Securities covered
by such Prospectus and any amendment or supplement thereto.
(f) Cooperate with the Electing Holders to facilitate the timely
preparation and delivery of certificates representing Registrable Securities to
be delivered to a transferee pursuant to a Piggy-Back Registration Statement,
which certificates shall be free, to the extent permitted by the Purchase
Agreement, of all restrictive legends, and to enable such Registrable Securities
to be in such denominations and registered in such names as any such Electing
Holders may request.
(g) Comply with all applicable rules and regulations of the
Commission.
(h) The Company shall not be required to deliver any document
pursuant to any provision of this Section 6, other than Section 6(e), to any
Electing Holder that proposes to sell Registrable Securities with less than
$500,000 in aggregate offering price to the public under the Piggy-Back
Registration Statement (based on the last sale price per Common Share on the
Trading Market on the Trading Day preceding the date of the written request sent
by such Electing Holder under Section 4).
10
(i) Upon the occurrence of any event described in Section 6(c)(vii),
as promptly as reasonably possible, prepare a supplement or amendment, including
a post-effective amendment, to such a Piggy-Back Registration Statement or a
supplement to the related Prospectus or any document incorporated or deemed to
be incorporated therein by reference, and file any other required document so
that, as thereafter delivered, neither such Piggy-Back Registration Statement
nor its related Prospectus will 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.
7. Registration Expenses. 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 any Registrable Securities are sold pursuant to a
Registration Statement. The fees and expenses referred to in the foregoing
sentence shall include (a) all registration and filing fees (including, without
limitation, fees and expenses (i) with respect to filings required to be made
with any Trading Market, and (ii) in compliance with applicable state securities
or Blue Sky laws (including, without limitation, fees and disbursements of
counsel for the Company in connection with Blue Sky qualifications or exemptions
of the Registrable Securities and determination of the eligibility of the
Registrable Securities for investment under the laws of such jurisdictions as
requested by the Holders )), (b) printing expenses (including, without
limitation, expenses of printing certificates for Registrable Securities and of
printing prospectuses requested by the Holders), (c) messenger, telephone and
delivery expenses incurred by the Company, (d) fees and disbursements of counsel
for the Company, and (e) fees and expenses of all other Persons retained by the
Company in connection with the consummation of the transactions contemplated by
this Agreement. The fees and expenses referred to in the first sentence shall
exclude (x) all underwriting discounts, selling commissions and stock transfer
or documentary stamp taxes, if any, applicable to any Registrable Securities
registered and sold by such holder, (y) all fees and disbursements of any
counsel for such holder, including Purchaser Counsel and (z) all expenses
incurred by the Purchaser or Holders without first receiving the consent of the
Company.
8. Indemnification
(a) Indemnification by the Company. The Company shall,
notwithstanding any termination of this Agreement, indemnify and hold harmless
each Holder, the officers, directors, partners, members, agents, brokers
(including brokers who offer and sell Registrable Securities as principal as a
result of a pledge or any failure to perform under a margin call of Common
Stock), investment advisors and employees of each of them, each Person who
controls any such Holder (within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act) and the officers, directors, partners,
members, agents and employees of each such controlling Person, to the fullest
extent permitted by applicable law, from and against any and all Losses, as
incurred, arising out of or relating to any untrue or alleged untrue statement
of a material fact contained in a Registration Statement, any Prospectus or any
form of prospectus or in any amendment or supplement thereto or in any
preliminary prospectus, or arising out of or relating to any omission or alleged
omission of a material fact required to be stated therein or necessary to make
the statements therein (in the case of any Prospectus or form of prospectus or
supplement thereto, in light of the circumstances under which they were made)
not misleading, except to the extent, but only to the extent, that (i) such
untrue statements or omissions are based solely upon information regarding such
Holder furnished in writing to the Company by such
11
Holder expressly for use therein, or to the extent that such information relates
to such Holder or such Holder's proposed method of distribution of Registrable
Securities and was reviewed and expressly approved in writing by such Holder
expressly for use in a Registration Statement, such Prospectus or such form of
Prospectus or in any amendment or supplement thereto or (ii) in the case of an
occurrence of an event of the type specified in Section 5(c)(v)-(vii), the use
by such Holder of an outdated or defective Prospectus after the Company has
notified such Holder in writing that the Prospectus is outdated or defective and
prior to the receipt by such Holder of the Advice contemplated in Section 9(f).
The Company shall notify the Holders promptly of the institution, threat or
assertion of any Proceeding of which the Company is aware in connection with the
transactions contemplated by this Agreement.
(b) Indemnification by Holders. Each Holder shall, severally and not
jointly, indemnify and hold harmless the Company, its directors, officers,
agents and employees, each Person who controls the Company (within the meaning
of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the
directors, officers, agents or employees of such controlling Persons, to the
fullest extent permitted by applicable law, from and against all Losses (as
determined by a court of competent jurisdiction in a final judgment not subject
to appeal or review) arising solely out of any untrue statement of a material
fact contained in any Registration Statement, any Prospectus, or any form of
prospectus, or in any amendment or supplement thereto, or arising solely out of
any omission of a material fact required to be stated therein or necessary to
make the statements therein not misleading to the extent, but only to the
extent, that such untrue statement or omission is contained in any information
so furnished in writing by such Holder to the Company specifically for inclusion
in such Registration Statement or such Prospectus. In no event shall the
liability of any selling Holder hereunder be greater in amount than the dollar
amount of the net proceeds received by such Holder upon the sale of the
Registrable Securities giving rise to such indemnification obligation.
(c) Conduct of Indemnification Proceedings. If any Proceeding shall
be brought or asserted against any Person entitled to indemnity hereunder (an
"INDEMNIFIED PARTY"), such Indemnified Party shall promptly notify the Person
from whom indemnity is sought (the "INDEMNIFYING PARTY") in writing, and the
Indemnifying Party shall assume the defense thereof, including the employment of
counsel reasonably satisfactory to the Indemnified Party and the payment of all
fees and expenses incurred in connection with defense thereof; provided, that
the failure of any Indemnified Party to give such notice shall not relieve the
Indemnifying Party of its obligations or liabilities pursuant to this Agreement,
except (and only) to the extent that it shall be finally determined by a court
of competent jurisdiction (which determination is not subject to appeal or
further review) that such failure shall have proximately and materially
adversely prejudiced the Indemnifying Party.
An Indemnified Party shall have the right to employ separate counsel
in any such Proceeding and to participate in the defense thereof, but the fees
and expenses of such counsel shall be at the expense of such Indemnified Party
or Parties unless: (i) the Indemnifying Party has agreed in writing to pay such
fees and expenses; or (ii) the Indemnifying Party shall have failed promptly to
assume the defense of such Proceeding and to employ counsel reasonably
satisfactory to such Indemnified Party in any such Proceeding; or (iii) the
named parties to any such Proceeding (including any impleaded parties) include
both such Indemnified Party and the Indemnifying Party, and such Indemnified
Party shall have been advised by counsel that a
12
conflict of interest is likely to exist if the same counsel were to represent
such Indemnified Party and the Indemnifying Party (in which case, if such
Indemnified Party notifies the Indemnifying Party in writing that it elects to
employ separate counsel at the expense of the Indemnifying Party, the
Indemnifying Party shall not have the right to assume the defense thereof and
such counsel shall be at the expense of the Indemnifying Party). The
Indemnifying Party shall not be liable for any settlement of any such Proceeding
effected without its written consent, which consent shall not be unreasonably
withheld. No Indemnifying Party shall, without the prior written consent of the
Indemnified Party, effect any settlement of any pending Proceeding in respect of
which any Indemnified Party is a 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.
All fees and expenses of the Indemnified Party (including reasonable
fees and expenses to the extent incurred in connection with investigating or
preparing to defend such Proceeding in a manner not inconsistent with this
Section) shall be paid to the Indemnified Party, as incurred, within ten Trading
Days of written notice thereof to the Indemnifying Party (regardless of whether
it is ultimately determined that an Indemnified Party is not entitled to
indemnification hereunder; provided, that the Indemnifying Party may require
such Indemnified Party to undertake to reimburse all such fees and expenses to
the extent it is finally judicially determined that such Indemnified Party is
not entitled to indemnification hereunder).
(d) Contribution. If a claim for indemnification under Section 7(a)
or 7(b) is unavailable to an Indemnified Party (by reason of public policy or
otherwise), then each Indemnifying Party, in lieu of indemnifying such
Indemnified Party, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such Losses, in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party and
Indemnified Party in connection with the actions, statements or omissions that
resulted in such Losses as well as any other relevant equitable considerations.
The relative fault of such Indemnifying Party and Indemnified Party shall be
determined by reference to, among other things, whether any action in question,
including any untrue or alleged untrue statement of a material fact or omission
or alleged omission of a material fact, has been taken or made by, or relates to
information supplied by, such Indemnifying Party or Indemnified Party, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such action, statement or omission. The amount paid or
payable by a party as a result of any Losses shall be deemed to include, subject
to the limitations set forth in Section 8(c), any reasonable attorneys' or other
reasonable fees or expenses incurred by such party in connection with any
Proceeding to the extent such party would have been indemnified for such fees or
expenses if the indemnification provided for in this Section was available to
such party in accordance with its terms.
The parties hereto agree that it would not be just and equitable if
contribution pursuant to this Section 8(d) were determined by pro rata
allocation or by any other method of allocation that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 8(d), no Holder shall be required
to contribute, in the aggregate, any amount in excess of the amount by which the
proceeds actually received by such Holder from the sale of the Registrable
Securities subject to the Proceeding 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
13
omission. No Person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any Person who was not guilty of such fraudulent misrepresentation.
(e) Other. To the extent that the provisions on indemnification and
contribution contained in the underwriting agreement entered into in connection
with an underwritten public offering are in conflict with the indemnification
provisions of this Agreement, the provisions of the underwriting agreement will
control.
The indemnity and contribution agreements contained in this Section
are in addition to any liability that the Indemnifying Parties may have to the
Indemnified Parties.
9. Miscellaneous
(a) Remedies. In the event of a breach by the Company or by a Holder
of any of their obligations under this Agreement, each Holder or the Company, as
the case may be, in addition to being entitled to exercise all rights granted by
law and under this Agreement, including recovery of damages, will be entitled to
specific performance of its rights under this Agreement. The Company and each
Holder agree that monetary damages would not provide adequate compensation for
any losses incurred by reason of a breach by it of any of the provisions of this
Agreement and hereby further agrees that, in the event of any action for
specific performance in respect of such breach, it shall waive the defense that
a remedy at law would be adequate.
(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 the same shall be in writing and signed by the Company
and the Holders of at least two-thirds of the then outstanding Registrable
Securities. Notwithstanding the foregoing, a waiver or consent to depart from
the provisions hereof with respect to a matter that relates exclusively to the
rights of Holders and that does not directly or indirectly affect the rights of
other Holders may be given by Holders of at least a majority of the Registrable
Securities to which such waiver or consent relates; 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.
(c) No Inconsistent Agreements. Neither the Company nor any of its
subsidiaries has entered, as of the date hereof, nor shall the Company or any of
its subsidiaries, on or after the date of this Agreement, enter into any
agreement with respect to its securities that would have the effect of impairing
the rights granted to the Holders in this Agreement or otherwise conflicts with
the provisions hereof. Except as and to the extent specified in the applicable
schedule to the Purchase Agreement, neither the Company nor any Subsidiary has
previously entered into any agreement granting any registration rights with
respect to any of its securities to any Person that have not been satisfied in
full.
(d) No Piggyback on Registrations. Neither the Company nor any of
its security holders (other than the Holders in such capacity pursuant hereto)
may include securities of the Company in a Demand Registration Statement other
than the Registrable Securities unless
14
required to do so by currently existing agreements, and the Company shall not
after the date hereof enter into any agreement providing any such right to any
of its security holders.
(e) Compliance. Each Holder covenants and agrees that it will comply
with the prospectus delivery requirements of the Securities Act as applicable to
it in connection with sales of Registrable Securities pursuant to a Registration
Statement.
(f) Discontinued Disposition. Each Holder agrees by its acquisition
of such Registrable Securities that, upon receipt of a notice from the Company
of the occurrence of any event of the kind described in Sections 5(c)(v),
5(c)(vi), or 5(c)(vii), or Sections 6(c)(v), 6(c)(vi), or 6(c)(vii), as
applicable, which notice may be given by the Company regardless of whether a
registration has been effected pursuant to Section 2, 3, or 4, such Holder will
forthwith discontinue disposition of such Registrable Securities under a
Registration Statement until such Holder's receipt of the copies of any
supplemented Prospectus and/or amended Registration Statement (if required
pursuant to Section 5(j) or 6(i)), or until it is advised in writing (the
"ADVICE") by the Company that the use of the applicable Prospectus may be
resumed, and, in either case, has received copies of any additional or
supplemental filings that are incorporated or deemed to be incorporated by
reference in such Prospectus or Registration Statement. The Company may provide
appropriate stop orders to enforce the provisions of this paragraph.
(g) Notices. Any and all notices or other communications or
deliveries required or permitted to be provided hereunder shall be in writing
and shall be deemed given and effective on the earliest of (a) the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile telephone number specified in this Section prior to 4:30 p.m. (New
York City time) on a Trading Day, (b) the next Trading Day after the date of
transmission, if such notice or communication is delivered via facsimile at the
facsimile telephone number specified in this Agreement on a day that is not a
Trading Day or later than 4:30 p.m. (New York City time) and earlier than 11:59
p.m. (New York City time) on any Trading Day, (c) the Trading Day following the
date of mailing, if sent by U.S. nationally recognized overnight courier
service, or (d) upon actual receipt by the party to whom such notice is required
to be given. The address for such notices and communications shall be as set
forth in the Purchase Agreement.
(h) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and permitted assigns of each of
the parties and shall inure to the benefit of each Holder. The Company may not
assign its rights or obligations hereunder without the prior written consent of
each Holder. A Holder that is a Stockholder (as defined in the Stockholder's
Agreement) may assign its rights and obligations hereunder to a Related
Transferee (as defined in the Stockholder's Agreement) in the manner and to the
extent permitted under the Transaction Documents.
(i) Counterparts. This Agreement may be executed in any number of
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. In
the event that any signature is delivered by facsimile transmission, such
signature shall create a valid binding obligation of the party executing (or on
whose behalf such signature is executed) the same with the same force and effect
as if such facsimile signature were the original thereof.
15
(j) GOVERNING LAW; VENUE; WAIVER OF JURY TRIAL. ALL QUESTIONS
CONCERNING THE CONSTRUCTION, VALIDITY, ENFORCEMENT AND INTERPRETATION OF THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE
INTERNAL LAWS OF THE STATE OF DELAWARE WITHOUT REGARD TO CONFLICTS OF LAWS
PRINCIPLES. EACH PARTY AGREES THAT ALL LEGAL PROCEEDINGS CONCERNING THE
INTERPRETATIONS, ENFORCEMENT AND DEFENSE OF THE TRANSACTIONS CONTEMPLATED BY
THIS AGREEMENT (WHETHER BROUGHT AGAINST A PARTY HERETO OR ITS RESPECTIVE
AFFILIATES, DIRECTORS, OFFICERS, STOCKHOLDERS, EMPLOYEES OR AGENTS) SHALL BE
COMMENCED EXCLUSIVELY IN THE STATE AND U.S. FEDERAL COURTS SITTING IN THE STATE
OF DELAWARE. EACH PARTY HERETO HEREBY IRREVOCABLY SUBMITS TO THE EXCLUSIVE
JURISDICTION OF THE STATE AND U.S. FEDERAL COURTS SITTING IN THE STATE OF
DELAWARE FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION HEREWITH
OR WITH ANY TRANSACTION CONTEMPLATED HEREBY OR DISCUSSED HEREIN (INCLUDING WITH
RESPECT TO THE ENFORCEMENT OF ANY OF THIS AGREEMENT), AND HEREBY IRREVOCABLY
WAIVES, AND AGREES NOT TO ASSERT IN ANY SUIT, ACTION OR PROCEEDING, ANY CLAIM
THAT IT IS NOT PERSONALLY SUBJECT TO THE JURISDICTION OF ANY SUCH COURT, THAT
SUCH SUIT, ACTION OR PROCEEDING IS IMPROPER. EACH PARTY HERETO HEREBY
IRREVOCABLY WAIVES PERSONAL SERVICE OF PROCESS AND CONSENTS TO PROCESS BEING
SERVED IN ANY SUCH SUIT, ACTION OR PROCEEDING BY MAILING A COPY THEREOF VIA
REGISTERED OR CERTIFIED MAIL OR OVERNIGHT DELIVERY (WITH EVIDENCE OF DELIVERY)
TO SUCH PARTY AT THE ADDRESS IN EFFECT FOR NOTICES TO IT UNDER THIS AGREEMENT
AND AGREES THAT SUCH SERVICE SHALL CONSTITUTE GOOD AND SUFFICIENT SERVICE OF
PROCESS AND NOTICE THEREOF. NOTHING CONTAINED HEREIN SHALL BE DEEMED TO LIMIT IN
ANY WAY ANY RIGHT TO SERVE PROCESS IN ANY MANNER PERMITTED BY LAW. EACH PARTY
HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. IF EITHER
PARTY SHALL COMMENCE AN ACTION OR PROCEEDING TO ENFORCE ANY PROVISIONS OF THIS
AGREEMENT , THEN THE PREVAILING PARTY IN SUCH ACTION OR PROCEEDING SHALL BE
REIMBURSED BY THE OTHER PARTY FOR ITS REASONABLE ATTORNEYS FEES AND OTHER
REASONABLE COSTS AND EXPENSES INCURRED WITH THE INVESTIGATION, PREPARATION AND
PROSECUTION OF SUCH ACTION OR PROCEEDING.
(k) Cumulative Remedies. The remedies provided herein are cumulative
and not exclusive of any remedies provided by law.
(l) Severability. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their reasonable efforts to find and employ an alternative
means to
16
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.
(m) Market Standoff. Each of the Purchaser and each other holder of
Registrable Securities shall, if requested by the managing underwriter or
underwriters in an underwritten offering, agree not to effect any public sale or
distribution of securities of the Company of the same class as the securities
included in a Registration Statement relating to such offering, including a sale
pursuant to Rule 144 under the Securities Act, except as part of such
underwritten registration, during the 15-day period prior to, and during a
period ("Lock-Up Period") ending on the earlier of (a) such time as the Company
and the managing underwriter shall agree and (b) 90 days after the effective
date of, each underwritten offering made pursuant to such Registration
Statement.
(n) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGES TO FOLLOW]
17
IN WITNESS WHEREOF, the parties have executed this Registration
Rights Agreement as of the date first written above.
WCA WASTE CORPORATION
By: /s/ Xxxxxx X. Xxxxxxx, Xx.
----------------------------------
Name: Xxxxxx X. Xxxxxxx, Xx.
Title: Vice President
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGES OF PURCHASERS TO FOLLOW]
18
ARES CORPORATE OPPORTUNITIES FUND II,
L.P.
By: ACOF MANAGEMENT II, L.P.,
Its General Partner
By: ACOF OPERATING MANAGER II, L.P.,
Its General Partner
By: ARES MANAGEMENT, INC.,
Its General Partner
By: /s/ Xxxxx Xxxxxx
----------------------------------
Name: Xxxxx Xxxxxx
Title: Senior Partner
Address for Notice:
Ares Corporate Opportunities
Fund II, L.P.
C/O Ares Management, Inc.
1999 Avenue of the Xxxxx
Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Phone: (000) 000.0000
Fax: (000) 000.0000
Attention: Xxxxxxx Xxxxxx
With a copy to:
Xxxxxx Xxxxxx & Xxxxxxx LLP
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Facsimile No.: (000) 000-0000
Attn: Xxxxxxxx X. Xxxxxxxxx, Esq.
and Xxxx X. Xxxxxx, Esq.
19
Annex A
PLAN OF DISTRIBUTION
The selling stockholders may, from time to time, sell any or all of their
shares of common stock on any stock exchange, market or trading facility on
which the shares are traded or in private transactions. These sales may be at
fixed or negotiated prices. The selling stockholders may use any one or more of
the following methods when selling shares:
- ordinary brokerage transactions and transactions in which the
broker-dealer solicits purchasers;
- block trades in which the broker-dealer will attempt to sell the shares as
agent but may position and resell a portion of the block as principal to
facilitate the transaction;
- purchases by a broker-dealer as principal and resale by the broker-dealer
for its account;
- an exchange distribution in accordance with the rules of the applicable
exchange;
- privately negotiated transactions;
- short sales;
- broker-dealers may agree with the selling stockholders to sell a specified
number of such shares at a stipulated price per share;
- a combination of any such methods of sale; and
- any other method permitted pursuant to applicable law.
The selling stockholders may also sell shares under Rule 144 under the
Securities Act, if available, rather than under this prospectus.
The selling stockholders may also engage in short sales against the box,
puts and calls and other transactions in our securities or derivatives of our
securities and may sell or deliver shares in connection with these trades.
Broker-dealers engaged by the selling stockholders may arrange for other
brokers-dealers to participate in sales. Broker-dealers may receive commissions
or discounts from the selling stockholders (or, if any broker-dealer acts as
agent for the purchaser of shares, from the purchaser) in amounts to be
negotiated. The selling stockholders do not expect these commissions and
discounts to exceed what is customary in the types of transactions involved. Any
profits on the resale of shares of common stock by a broker-dealer acting as
principal might
be deemed to be underwriting discounts or commissions under the Securities Act.
Discounts, concessions, commissions and similar selling expenses, if any,
attributable to the sale of shares will be borne by a selling stockholder. The
selling stockholders may agree to indemnify any agent, dealer or broker-dealer
that participates in transactions involving sales of the shares if liabilities
are imposed on that person under the Securities Act.
The selling stockholders may from time to time pledge or grant a security
interest in some or all of the shares of common stock owned by them and, if they
default in the performance of their secured obligations, the pledgees or secured
parties may offer and sell the shares of common stock from time to time under
this prospectus after we have filed an amendment to this prospectus under Rule
424(b)(3) or other applicable provision of the Securities Act of 1933 amending
the list of selling stockholders to include the pledgee, transferee or other
successors in interest as selling stockholders under this prospectus.
The selling stockholders also may transfer the shares of common stock in
other circumstances, in which case the transferees, pledgees or other successors
in interest will be the selling beneficial owners for purposes of this
prospectus and may sell the shares of common stock from time to time under this
prospectus after we have filed an amendment to this prospectus under Rule
424(b)(3) or other applicable provision of the Securities Act of 1933 amending
the list of selling stockholders to include the pledgee, transferee or other
successors in interest as selling stockholders under this prospectus.
The selling stockholders and any broker-dealers or agents that are
involved in selling the shares of common stock may be deemed to be
"underwriters" within the meaning of the Securities Act in connection with such
sales. In such event, any commissions received by such broker-dealers or agents
and any profit on the resale of the shares of common stock purchased by them may
be deemed to be underwriting commissions or discounts under the Securities Act.
We are required to pay all fees and expenses incident to the registration
of the shares of common stock, including the fees and disbursements of counsel
to the selling stockholders. We have agreed to indemnify the selling
stockholders against certain losses, claims, damages and liabilities, including
liabilities under the Securities Act.
The selling stockholders have advised us that they have not entered into
any agreements, understandings or arrangements with any underwriters or
broker-dealers regarding the sale of their shares of common stock, nor is there
an underwriter or coordinating broker acting in connection with a proposed sale
of shares of common stock by any selling stockholder. If we are notified by any
selling stockholder that any material arrangement has been entered into with a
broker-dealer for the sale of shares of common stock, if required, we will file
a supplement to this prospectus. If the selling stockholders use this prospectus
for any sale of the shares of common stock, they will be subject to the
prospectus delivery requirements of the Securities Act.
The anti-manipulation rules of Regulation M under the Securities Exchange
Act of 1934 may apply to sales of our common stock and activities of the selling
stockholders.
