EXHIBIT 4.2
BANC OF AMERICA SECURITIES LLC
$200,000,000 AGGREGATE PRINCIPAL AMOUNT
MAXTOR CORPORATION
6.80% CONVERTIBLE SENIOR NOTES
DUE 2010
RESALE REGISTRATION RIGHTS AGREEMENT
DATED MAY 7, 2003
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RESALE REGISTRATION RIGHTS AGREEMENT, dated as of May 7, 2003, between
Maxtor Corporation, a Delaware corporation (together with any successor entity,
herein referred to as the "COMPANY") and Banc of America Securities LLC and
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated (the "INITIAL PURCHASERS")
under the Purchase Agreement (as defined below).
Pursuant to the Purchase Agreement, dated as of May 2, 2003, among the
Company and the Initial Purchasers (the "PURCHASE AGREEMENT"), the Initial
Purchasers have agreed to purchase from the Company $200,000,000 ($230,000,000
if the Initial Purchasers exercise their option in full) in aggregate principal
amount of 6.80% Convertible Senior Notes due 2010 (the "NOTES"). The Notes will
be convertible into fully paid, nonassessable shares of common stock, par value
$0.01 per share, of the Company (the "COMMON Stock"). The Notes will be
convertible on the terms, and subject to the conditions, set forth in the
Indenture (as defined herein). To induce the Initial Purchasers to purchase the
Notes, the Company has agreed to provide the registration rights set forth in
this Agreement pursuant to Section 1 of the Purchase Agreement.
The parties hereby agree as follows:
1. Definitions. Capitalized terms used in this Agreement without
definition shall have their respective meanings set forth in the Purchase
Agreement. As used in this Agreement, the following capitalized terms shall have
the following meanings:
"AFFILIATE" of any specified person means any other person which, directly
or indirectly, is in control of, is controlled by, or is under common control
with, such specified person. For purposes of this definition, control of a
person means the power, direct or indirect, to direct or cause the direction of
the management and policies of such person whether by contract or otherwise; and
the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"AGREEMENT": This Resale Registration Rights Agreement.
"AMENDMENT EFFECTIVENESS DEADLINE DATE": As defined in Section 2(e)
hereof.
"BLUE SKY APPLICATION": As defined in Section 6(a)(i) hereof.
"BUSINESS DAY": The definition of "Business Day" in the Indenture.
"COMMISSION": Securities and Exchange Commission.
"COMMON STOCK": As defined in the preamble hereto.
"COMPANY": As defined in the preamble hereto.
"EFFECTIVENESS PERIOD": As defined in Section 2(a)(iii) hereof.
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"EFFECTIVENESS TARGET DATE": As defined in Section 2(a)(ii) hereof.
"EXCHANGE ACT": Securities Exchange Act of 1934, as amended.
"HOLDER": A Person who owns, beneficially or otherwise, Transfer
Restricted Securities.
"INDEMNIFIED HOLDER": As defined in Section 6(a) hereof.
"INDENTURE": The Indenture, dated as of May 7, 2003 between the Company
and U.S. Bank National Association, as trustee (the "TRUSTEE"), pursuant to
which the Securities are to be issued, as such Indenture is amended, modified or
supplemented from time to time in accordance with the terms thereof.
"INITIAL PURCHASERS": As defined in the preamble hereto.
"LIQUIDATED DAMAGES": As defined in Section 3(b) hereof.
"LIQUIDATED DAMAGES PAYMENT DATE": Each April 30 and October 30.
"MAJORITY OF HOLDERS": Holders holding over 50% of the aggregate principal
amount of Notes outstanding; provided that, for the purposes of this definition,
a holder of shares of Common Stock which constitute Transfer Restricted
Securities issued upon conversion of the Notes shall be deemed to hold an
aggregate principal amount of Notes (in addition to the principal amount of
Notes held by such holder) equal to the quotient of (x) the number of such
shares of Common Stock held by such holder and (y) the conversion rate in effect
at the time of such conversion as determined in accordance with the Indenture.
"NASD": National Association of Securities Dealers, Inc.
"NOTES": As defined in the preamble hereto.
"NOTICE AND QUESTIONNAIRE": A written notice executed by the respective
Holder and delivered to the Company containing substantially the information
called for by the Selling Securityholder Notice and Questionnaire attached as
Appendix A to the Offering Memorandum of the Company issued May 2, 2003 relating
to the Notes.
"NOTICE HOLDER": On any date, any Holder that has delivered a Notice and
Questionnaire to the Company on or prior to such date.
"PERSON": An individual, partnership, corporation, company, unincorporated
organization, trust, joint venture or a government or agency or political
subdivision thereof.
"PURCHASE AGREEMENT": As defined in the preamble hereto.
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"PROSPECTUS": The prospectus included in a Shelf Registration Statement,
as amended or supplemented by any prospectus supplement and by all other
amendments thereto, including post-effective amendments, and all material
incorporated by reference into such prospectus.
"RECORD HOLDER": With respect to any Liquidated Damages Payment Date, each
Person who is a Holder of Notes which are Transfer Restricted Securities on the
15th day preceding the relevant Liquidated Damages Payment Date.
"REGISTRATION DEFAULT": As defined in Section 3(a) hereof.
"SECURITIES ACT": Securities Act of 1933, as amended.
"SHELF FILING DEADLINE": As defined in Section 2(a)(i) hereof.
"SHELF REGISTRATION STATEMENT": As defined in Section 2(a)(i) hereof.
"SUBSEQUENT SHELF REGISTRATION STATEMENT": As defined in Section 2(c)
hereof.
"SUSPENSION NOTICE": As defined in Section 4(c) hereof.
"SUSPENSION PERIOD": As defined in Section 4(b)(i) hereof.
"TIA": Trust Indenture Act of 1939, as amended, and the rules and
regulations of the Commission thereunder, in each case, as in effect on the date
the Indenture is qualified under the TIA.
"TRANSFER RESTRICTED SECURITIES": Each Note and each share of Common Stock
issued upon conversion of Notes until the earlier of:
(i) the date on which such Note or such share of Common Stock issued
upon conversion has been effectively registered under the Securities Act
and disposed of in accordance with the Shelf Registration Statement;
(ii) the date on which such Note or such share of Common Stock
issued upon conversion is transferred in compliance with Rule 144 under
the Securities Act or may be sold or transferred by a person who is not an
affiliate of the Company pursuant to Rule 144(k) under the Securities Act
(or any other similar provision then in force); or
(iii) the date on which such Note or such share of Common Stock
issued upon conversion ceases to be outstanding (whether as a result of
redemption, repurchase and cancellation, conversion or otherwise).
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"UNDERWRITTEN REGISTRATION": A registration in which Notes of the Company
are sold to an underwriter for reoffering to the public.
Unless the context otherwise requires, the singular includes the plural,
and words in the plural include the singular.
2. Shelf Registration.
(a) The Company shall:
(i) not later than 90 days after the date hereof (the "SHELF
FILING DEADLINE"), cause to be filed a registration statement
pursuant to Rule 415 under the Securities Act (the "SHELF
REGISTRATION STATEMENT"), which Shelf Registration Statement shall
provide for resales of all Transfer Restricted Securities held by
Holders that have provided the information required pursuant to the
terms of Section 2(e) hereof;
(ii) use its best efforts to cause the Shelf Registration
Statement to be declared effective by the Commission not later than
180 days after the date hereof (the "EFFECTIVENESS TARGET DATE");
and
(iii) use its best efforts to keep the Shelf Registration
Statement continuously effective, supplemented and amended as
required by the provisions of Section 4(b) hereof to the extent
necessary to ensure that (A) it is available for resales by the
Holders of Transfer Restricted Securities entitled, to the benefit
of this Agreement and (B) conforms with the requirements of this
Agreement and the Securities Act and the rules and regulations of
the Commission promulgated thereunder as announced from time to
time, for a period (the "EFFECTIVENESS PERIOD") until the earliest
of:
(1) two years after the last date of original issuance
of any of the Notes; or
(2) the date when the Holders of Transfer Restricted
Securities are able to sell all such Transfer Restricted
Securities immediately pursuant to Rule 144(k) under the
Securities Act; or
(3) the date when all of the Transfer Restricted
Securities are disposed of pursuant to the Shelf Registration
Statement or Rule 144 under the Securities Act or any similar
provision then in effect.
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(b) None of the Company's security holders (other than the Holders
of Transfer Restricted Securities) shall have the right to include any of
the Company's securities in the Shelf Registration Statement.
(c) If the Shelf Registration Statement or any Subsequent Shelf
Registration Statement ceases to be effective for any reason at any time
during the Effectiveness Period (other than because all Transfer
Restricted Securities registered thereunder shall have been resold
pursuant thereto or shall have otherwise ceased to be Transfer Restricted
Securities), the Company shall use its best efforts to obtain the prompt
withdrawal of any order suspending the effectiveness thereof, and in any
event shall within thirty (30) days of such cessation of effectiveness
amend the Shelf Registration Statement in a manner reasonably expected to
obtain the withdrawal of the order suspending the effectiveness thereof,
or file an additional Shelf Registration Statement covering all of the
securities that as of the date of such filing are Transfer Restricted
Securities (a "SUBSEQUENT SHELF REGISTRATION STATEMENT"). If a Subsequent
Shelf Registration Statement is filed, the Company shall use its best
efforts to cause the Subsequent Shelf Registration Statement to become
effective as promptly as is practicable after such filing and to keep such
Registration Statement (or subsequent Shelf Registration Statement)
continuously effective until the end of the Effectiveness Period.
(d) The Company shall supplement and amend the Shelf Registration
Statement if required by the rules, regulations or instructions applicable
to the registration form used by the Company for such Shelf Registration
Statement, if required by the Securities Act or as reasonably requested by
the Initial Purchasers or by the Trustee on behalf of the Holders of the
Transfer Restricted Securities covered by such Shelf Registration
Statement.
(e) Each Holder agrees that if such Holder wishes to sell Transfer
Restricted Securities pursuant to a Shelf Registration Statement and
related Prospectus, it will do so only in accordance with this Section
2(e) and Section 4(b). Each Holder wishing to sell Transfer Restricted
Securities pursuant to a Shelf Registration Statement and related
Prospectus must deliver a Notice and Questionnaire to the Company. In
order to be named as a selling securityholder in the Prospectus at the
time of effectiveness of the Shelf Registration Statement, the Notice and
Questionnaire must be delivered at least ten (10) Business Days prior to
the effectiveness of the Shelf Registration Statement. From and after the
date the Shelf Registration Statement is declared effective, the Company
shall, as promptly as practicable after the date a Notice and
Questionnaire is delivered, and in any event upon the later of (x) ten
(10) Business Days after such date or (y) ten (10) Business Days after the
expiration of any Suspension Period in effect when the Notice and
Questionnaire is delivered:
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(i) if required by applicable law, file with the SEC a
post-effective amendment to the Shelf Registration Statement or
prepare and, if required by applicable law, file a supplement to the
related Prospectus or a supplement or amendment to any document
incorporated therein by reference or file any other required
document so that the Holder delivering such Notice and Questionnaire
is named as a selling securityholder in the Shelf Registration
Statement and the related Prospectus in such a manner as to permit
such Holder to deliver such Prospectus to purchasers of the Transfer
Restricted Securities in accordance with applicable law and, if the
Company shall file a post-effective amendment to the Shelf
Registration Statement, use its best efforts to cause such
post-effective amendment to be declared effective under the
Securities Act as promptly as is practicable, but in any event by
the date (the "AMENDMENT EFFECTIVENESS DEADLINE DATE") that is
forty-five (45) days after the date such post-effective amendment is
required by this clause to be filed;
(ii) provide such Holder upon its request copies of any
documents filed pursuant to Section 2(e)(i); and
(iii) notify such Holder as promptly as practicable after the
effectiveness under the Securities Act of any post-effective
amendment filed pursuant to Section 2(e)(i);
provided that if such Notice and Questionnaire is delivered during a Suspension
Period, the Company shall so inform the Holder delivering such Notice and
Questionnaire and shall take the actions set forth in clauses (i), (ii) and
(iii) above upon expiration of the Suspension Period in accordance with Section
4(b). Notwithstanding anything contained herein to the contrary, (i) the Company
shall be under no obligation to name any Holder that is not a Notice Holder as a
selling securityholder in any Registration Statement or related Prospectus and
(ii) the Amendment Effectiveness Deadline Date shall be extended by up to ten
(10) Business Days after the expiration of a Suspension Period (and the Company
shall incur no obligation to pay Liquidated Damages during such extension) if
such Suspension Period shall be in effect on the Amendment Effectiveness
Deadline Date.
3. Liquidated Damages.
(a) Each event referred to in the following clauses (i) through
(vi), is a "REGISTRATION DEFAULT":
(i) the Shelf Registration Statement is not filed with the
Commission prior to or on the Shelf Filing Deadline;
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(ii) the Shelf Registration Statement has not been declared
effective by the Commission prior to or on the Effectiveness Target
Date;
(iii) the Company has failed to perform its obligations set
forth in Section 2(e) within the time period required therein;
(iv) any post-effective amendment to a Shelf Registration
filed pursuant to Section 2(e)(i) has not become effective under the
Securities Act on or prior to the Amendment Effectiveness Deadline
Date;
(v) except as provided in Section 4(b)(i) hereof, the Shelf
Registration Statement is filed and declared effective but, during
the Effectiveness Period, shall thereafter cease to be effective or
fail to be usable for its intended purpose without being succeeded
within five Business Days by a post-effective amendment to the Shelf
Registration Statement, a supplement to the Prospectus or a report
filed with the Commission pursuant to Section 13(a), 13(c), 14 or
15(d) of the Exchange Act that cures such failure and, in the case
of a post-effective amendment, is itself immediately declared
effective; or
(vi) (A) prior to or on the 45th or 60th day, as the case may
be, of any Suspension Period, such suspension has not been
terminated or (B) a Suspension Period when aggregated with other
Suspension Periods during the prior 360-day period exceeds 90 days,
For purposes of this Agreement, each Registration Default set forth above
shall begin and be cured on the dates set forth in the table below:
Type of
Registration Default Beginning Cure
by Clause Date Date
--------- ---- ----
(i) Shelf Filing Deadline the date the Shelf
Registration Statement is
filed
(ii) Effectiveness Target Date the date the Shelf
Registration Statement is
declared effective by the
Commission
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Type of
Registration Default Beginning Cure
by Clause Date Date
--------- ---- ----
(iii) the date by which the the date the Company
Company is required to performs its obligations
perform its obligations set forth in Section 2(e)
under Section 2(e)
(iv) the Amendment the date the applicable
Effectiveness Deadline Date post-effective amendment
to a Shelf Registration
Statement becomes
effective under the
Securities Act
(v) the date five Business the date any
Days following the date post-effective amendment
that the Shelf is declared effective by
Registration Statement the Commission or any
ceases to be effective or supplement to the
fails to be usable Prospectus or report is
filed that makes the Shelf
Registration Statement
usable
(vi) the date on which a termination of the
Suspension Period, or the applicable Suspension
aggregate duration of Period
Suspension Periods in any
period, exceeds the
permitted number of days
(b) If a Registration Default occurs, other than a Registration
Default relating to a failure to file or have an effective Shelf
Registration Statement with respect to shares of Common Stock issuable
upon conversion of the Notes that are Transfer Restricted Securities, the
Company hereby agrees to pay interest ("LIQUIDATED DAMAGES") with respect
to the Notes that are Transfer Restricted Securities from and including
the day following beginning of the Registration Default to but excluding
the earlier of (1) the day on which the Registration Default has been
cured and (2) the date the Shelf Registration Statement is no longer
required to be kept effective, accruing at a rate (x) with respect to the
first 90-day period during which a Registration Default shall have
occurred and be continuing, equal to 0.25% per annum of the aggregate
principal amount of the Notes, and (y) with respect to the period
commencing on the 91st day following the day the Registration Default
shall have
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occurred and be continuing, equal to 0.50% per annum of the aggregate
principal amount of the Notes; provided that in no event shall Liquidated
Damages accrue at a rate per year exceeding 0.50% of the aggregate
principal amount of the Notes.
(c) All accrued Liquidated Damages shall be paid in arrears to
Record Holders by the Company on each Liquidated Damages Payment Date.
Upon the cure of all Registration Defaults relating to any particular
Note, the accrual of Liquidated Damages with respect to such Note will
cease.
(d) All obligations of the Company set forth in this Section 3 that
are outstanding with respect to any Note that is a Transfer Restricted
Security at the time such Note ceases to be a Transfer Restricted Security
shall survive until such time as all such obligations with respect to such
Note that is a Transfer Restricted Security shall have been satisfied in
full.
(e) The Liquidated Damages set forth above shall be the exclusive
monetary remedy available to the Holders of Notes that are Transfer
Restricted Securities for each Registration Default.
4. Registration Procedures.
(a) In connection with the Shelf Registration Statement, the Company shall
comply with all the provisions of Section 4(b) hereof and shall use its best
efforts to effect such registration to permit the sale of the Transfer
Restricted Securities, and pursuant thereto, shall as expeditiously as possible
prepare and file with the Commission a Shelf Registration Statement relating to
the registration on any appropriate form under the Securities Act.
(b) In connection with the Shelf Registration Statement and any Prospectus
required by this Agreement to permit the sale or resale of Transfer Restricted
Securities, the Company shall:
(i) Subject to any notice by the Company in accordance with this
Section 4(b) of the existence of any fact or event of the kind described
in Section 4(b)(iii)(D), use its best efforts to keep the Shelf
Registration Statement continuously effective during the Effectiveness
Period; upon the occurrence of any event that would cause the Shelf
Registration Statement or the Prospectus contained therein (A) to contain
a material misstatement or omission or (B) not to be effective and usable
for resale of Transfer Restricted Securities during the Effectiveness
Period, the Company shall file promptly an appropriate amendment to the
Shelf Registration Statement, a supplement to the Prospectus or a report
filed with the Commission pursuant to
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Section 13(a), 13(c), 14 or 15(d) of the Exchange Act, in the case of
clause (A), correcting any such misstatement or omission, and, in the case
of either clause (A) or (B), use its best efforts to cause such amendment
to be declared effective and the Shelf Registration Statement and the
related Prospectus to become usable for their intended purposes as soon as
practicable thereafter. Notwithstanding the foregoing, the Company may
suspend the effectiveness of the Shelf Registration Statement by written
notice to the Holders for a period not to exceed an aggregate of 45 days
in any 90-day period (each such period, a "SUSPENSION PERIOD") if:
(x) an event occurs and is continuing as a result of which the Shelf
Registration Statement, the Prospectus, any amendment or supplement
thereto, or any document incorporated by reference therein would, in the
Company's judgment, contain an untrue statement of a material fact or omit
to state a material fact required to be stated therein or necessary to
make the statements therein not misleading; and
(y) the Company determines in good faith that the disclosure of such
event at such time could be seriously detrimental to the Company and its
subsidiaries;
provided that, in the event the disclosure relates to a previously undisclosed
proposed or pending material business transaction, the disclosure of which the
Company determines in good faith would be reasonably likely to impede the
Company's ability to consummate such transaction, the Company may extend a
Suspension Period from 45 days to 60 days; provided, however, that Suspension
Periods shall not exceed an aggregate of 90 days in any 360-day period. The
Company shall not be required to specify in the written notice to the Holders
the nature of the event giving rise to the Suspension Period.
(ii) Prepare and file with the Commission such amendments and
post-effective amendments to the Shelf Registration Statement as may be
necessary to keep the Shelf Registration Statement effective during the
Effectiveness Period; cause the Prospectus to be supplemented by any
required Prospectus supplement, and as so supplemented to be filed
pursuant to Rule 424 under the Securities Act, and to comply fully with
the applicable provisions of Rules 424 and 430A under the Securities Act
in a timely manner; and comply with the provisions of the Securities Act
with respect to the disposition of all Transfer Restrict Securities
covered by the Shelf Registration Statement during the applicable period
in accordance with the intended method or methods of distribution by the
sellers thereof set forth
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in the Shelf Registration Statement or supplement to the Prospectus.
(iii) Advise the selling Holders promptly and, if requested by such
selling Holders, to confirm such advice in writing, except as provided in
clause (D) below:
(A) when the Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to the
Shelf Registration Statement or any post-effective amendment
thereto, when the same has become effective,
(B) of any request by the Commission for amendments to the
Shelf Registration Statement or amendments or supplements to the
Prospectus or for additional information relating thereto,
(C) of the issuance by the Commission of any stop order
suspending the effectiveness of the Shelf Registration Statement
under the Securities Act or of the suspension by any state
securities commission of the qualification of the Transfer
Restricted Securities for offering or sale in any jurisdiction, or
the initiation of any proceeding for any of the preceding purposes,
or
(D) of the existence of any fact or the happening of any
event, during the Effectiveness Period, that makes any statement of
a material fact made in the Shelf Registration Statement, the
Prospectus, any amendment or supplement thereto, or any document
incorporated by reference therein untrue, or that requires the
making of any additions to or changes in the Shelf Registration
Statement or the Prospectus in order to make the statements therein
not misleading.
If at any time the Commission shall issue any stop order suspending the
effectiveness of the Shelf Registration Statement, or any state securities
commission or other regulatory authority shall issue an order suspending the
qualification or exemption from qualification of the Transfer Restricted
Securities under state securities or Blue Sky laws, the Company shall use its
best efforts to obtain the withdrawal or lifting of such order at the earliest
possible time and will provide to each Holder who is named in the Shelf
Registration Statement prompt notice of the withdrawal of any such order.
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(iv) Make available at reasonable times for inspection by one
or more representatives of the selling Holders, designated in
writing by a Majority of Holders whose Transfer Restricted
Securities are included in the Shelf Registration Statement, and any
attorney or accountant retained by such selling Holders, all
financial and other records, pertinent corporate documents and
properties of the Company as shall be reasonably necessary to enable
them to conduct a reasonable investigation within the meaning of
Section 11 of the Securities Act, and cause the Company's officers,
directors, managers and employees to supply all information
reasonably requested by any such representative or representatives
of the selling Holders, attorney or accountant in connection
therewith; provided, however, that the Company shall have no
obligation to deliver information to any selling Holder or
representative pursuant to this Section 4(b)(iv) unless such selling
Holder or representative shall have executed and delivered a
confidentiality agreement in a form acceptable to the Company
relating to such information.
(v) If requested by any selling Holders, promptly incorporate
in the Shelf Registration Statement or Prospectus, pursuant to a
supplement or post-effective amendment if necessary, such
information as such selling Holders may reasonably request to have
included therein, including, without limitation, information
relating to the "PLAN OF DISTRIBUTION" of the Transfer Restricted
Securities.
(vi) Furnish to each selling Holder upon their request,
without charge, at least one copy of the Shelf Registration
Statement, as first filed with the Commission, and of each amendment
thereto (and any documents incorporated by reference therein or
exhibits thereto (or exhibits incorporated in such exhibits by
reference) as such Person may request).
(vii) Deliver to each selling Holder, without charge, as many
copies of the Prospectus (including each preliminary Prospectus) and
any amendment or supplement thereto as such Persons reasonably may
request; subject to any notice by the Company in accordance with
this Section 4(b) of the existence of any fact or event of the kind
described in Section 4(b)(iii)(D), the Company hereby consents to
the use of the Prospectus and any amendment or supplement thereto by
each of the selling Holders in connection with the offering and the
sale of the Transfer Restricted Securities covered by the Prospectus
or any amendment or supplement thereto.
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(viii) Before any public offering of Transfer Restricted
Securities, cooperate with the selling Holders and their counsel in
connection with the registration and qualification of the Transfer
Restricted Securities under the securities or Blue Sky laws of such
jurisdictions in the United States as the selling Holders may
reasonably request and do any and all other acts or things necessary
or advisable to enable the disposition in such jurisdictions of the
Transfer Restricted Securities covered by the Shelf Registration
Statement; provided, however, that the Company shall not be required
(A) to register or qualify as a foreign corporation or a dealer of
securities where it is not now so qualified or to take any action
that would subject it to the service of process in any jurisdiction
where it is not now so subject or (B) to subject itself to general
or unlimited service of process or to taxation in any such
jurisdiction if they are not now so subject.
(ix) Cooperate with the selling Holders to facilitate the
timely preparation and delivery of certificates representing
Transfer Restricted Securities to be sold and not bearing any
restrictive legends (unless required by applicable securities laws);
and enable such Transfer Restricted Securities to be in such
denominations and registered in such names as the Holders may
request at least two Business Days before any sale of Transfer
Restricted Securities.
(x) Use its best efforts to cause the Transfer Restricted
Securities covered by the Shelf Registration Statement to be
registered with or approved by such other U.S. governmental agencies
or authorities as may be necessary to enable the seller or sellers
thereof to consummate the disposition of such Transfer Restricted
Securities.
(xi) Subject to Section 4(b)(i) hereof, if any fact or event
contemplated by Section 4(b)(iii)(D) hereof shall exist or have
occurred, use its best efforts to prepare a supplement or
post-effective amendment to the Shelf Registration Statement or
related Prospectus or any document incorporated therein by reference
or file any other required document so that, as thereafter delivered
to the purchasers of Transfer Restricted Securities, the Prospectus
will not contain an 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 in
which they are made, not misleading.
(xii) Provide a CUSIP number for the Notes that are not
Transfer Restricted Securities not later than the effective date of
the Shelf Registration Statement and provide the Trustee under
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the Indenture with certificates for the Notes and shares of Common
Stock that are not Transfer Restricted Securities that are in a form
eligible for deposit with The Depository Trust Company.
(xiii) Cooperate and assist in any filings required to be made
with the NASD and in the performance of any due diligence
investigation by any underwriter that is required to be retained in
accordance with the rules and regulations of the NASD.
(xiv) Otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission and all reporting
requirements under the rules and regulations of the Exchange Act.
(xv) Cause the Indenture to be qualified under the TIA not
later than the effective date of the Shelf Registration Statement
required by this Agreement, and, in connection therewith, cooperate
with the Trustee and the holders of Securities to effect such
changes to the 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 best efforts to cause the Trustee thereunder to execute
all documents that may be required to effect such changes and all
other forms and documents required to be filed with the Commission
to enable such Indenture to be so qualified in a timely manner.
(xvi) Cause all Common Stock covered by the Shelf Registration
Statement to be listed or quoted, as the case may be, on each
securities exchange or automated quotation system on which Common
Stock is then listed or quoted.
(xvii) Provide to each Holder upon written request each
document filed with the Commission pursuant to the requirements of
Section 13 and Section 15 of the Exchange Act after the effective
date of the Shelf Registration Statement, unless such document is
available through the Commission's XXXXX system.
(c) Each Holder agrees by acquisition of a Transfer Restricted
Security that, upon receipt of any notice (a "SUSPENSION NOTICE") from the
Company of the existence of any fact of the kind described in Section
4(b)(iii)(D) hereof, such Holder will forthwith discontinue disposition of
Transfer Restricted Securities pursuant to the Shelf Registration
Statement until:
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(i) such Holder has received copies of the supplemented or
amended Prospectus contemplated by Section 4(b)(xi) hereof; or
(ii) such Holder is advised in writing by the Company that the
use of the Prospectus may be resumed, and has received copies of any
additional or supplemental filings that are incorporated by
reference in the Prospectus.
If so directed by the Company, each Holder will deliver to the Company (at the
Company's expense) all copies, other than permanent file copies then in such
Xxxxxx's possession, of the Prospectus covering such Transfer Restricted
Securities that was current at the time of receipt of such Suspension Notice.
(d) Each Holder agrees, by acquisition of the Transfer Restricted
Securities, that no Holder shall be entitled to sell any of such Transfer
Restricted Securities pursuant to a Registration Statement or to receive a
Prospectus relating thereto, unless such Holder has furnished the Company
with a Notice and Questionnaire as required pursuant to Section 2(e)
hereof (including the information required to be included in such Notice
and Questionnaire) and the information set forth in the next sentence.
Each Notice Holder agrees promptly to furnish to the Company all
information required to be disclosed in order to make the information
previously furnished to the Company by such Notice Holder not misleading
and any other information regarding such Notice Holder and the
distribution of such Transfer Restricted Securities as the Company may
from time to time reasonably request in writing. Any sale of any Transfer
Restricted Securities by any Holder shall constitute a representation and
warranty by such Holder that the information relating to such Holder and
its plan of distribution is as set forth in the Prospectus delivered by
such Holder in connection with such disposition, that such Prospectus does
not as of the time of such sale contain any untrue statement of a material
fact relating to or provided by such Holder or its plan of distribution
and that such Prospectus does not as of the time of such sale omit to
state any material fact relating to or provided by such Holder or its plan
of distribution necessary to make the statements in such Prospectus, in
the light of the circumstances under which they were made, not misleading.
5. Registration Expenses.
All expenses incident to the Company's performance of or compliance with
this Agreement shall be borne by the Company regardless of whether a Shelf
Registration Statement becomes effective, including, without limitation:
(i) all registration and filing fees and expenses (including
filings made with the NASD);
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(ii) all fees and expenses of compliance with federal
securities and state Blue Sky or securities laws;
(iii) all expenses of printing (including printing of
Prospectuses and certificates for the Common Stock to be issued upon
conversion of the Notes) and the Company's expenses for messenger
and delivery services and telephone;
(iv) all fees and disbursements of counsel to the Company;
(v) all application and filing fees in connection with listing
(or authorizing for quotation) the Common Stock on a national
securities exchange or automated quotation system pursuant to the
requirements hereof; and
(vi) all fees and disbursements of independent certified
public accountants of the Company.
The Company shall bear its internal expenses (including, without
limitation, all salaries and expenses of their officers and employees performing
legal, accounting or other duties), the expenses of any annual audit and the
fees and expenses of any Person, including special experts, retained by the
Company.
6. Indemnification And Contribution.
(a) The Company agrees to indemnify and hold harmless each Holder
(including each Initial Purchaser), its directors, officers, and employees
and each person, if any, who controls any such Holder within the meaning
of the Securities Act or the Exchange Act (each, an "INDEMNIFIED HOLDER"),
against any loss, claim, damage, liability or expense, joint or several,
or any action in respect thereof (including, but not limited to, any loss,
claim, damage, liability or action relating to resales of the Transfer
Restricted Securities), to which such Indemnified Holder may become
subject, insofar as any such loss, claim, damage, liability or action
arises out of, or is based upon:
(i) any untrue statement or alleged untrue statement of a
material fact contained in (A) the Shelf Registration Statement as
originally filed or in any amendment thereof, in any Prospectus, or
in any amendment or supplement thereto or (B) any blue sky
application or other document or any amendment or supplement thereto
prepared or executed by the Company (or based upon written
information furnished by or on behalf of the Company expressly for
use in such blue sky application or other document or amendment on
supplement) filed in any jurisdiction specifically for the purpose
of qualifying any or all of the Transfer
17
Restricted Securities under the securities law of any state or other
jurisdiction (such application or document being hereinafter called
a "BLUE SKY Application"); or
(ii) the omission or alleged omission to state therein any
material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which
they were made, not misleading,
and agrees to reimburse each Indemnified Holder promptly upon demand for any
legal or other expenses reasonably incurred by such Indemnified Holder in
connection with investigating, defending, settling, compromising or paying any
such loss, claim, damage, liability, expense or action; provided, however, that
the Company shall not be liable in any such case to the extent that any such
loss, claim, damage, liability or expense arises out of, or is based upon, any
untrue statement or alleged untrue statement or omission or alleged omission
made in reliance upon and in conformity with written information furnished to
the Company by or on behalf of such Holder (or its related Indemnified Holder)
specifically for use therein. The foregoing indemnity agreement is in addition
to any liability which the Company may otherwise have.
(b) Each Holder, severally and not jointly, agrees to
indemnify and hold harmless the Company, its directors, officers and
employees and each person, if any, who controls the Company within
the meaning of the Securities Act or the Exchange Act to the same
extent as the foregoing indemnity from the Company to each such
Holder, but only with reference to written information relating to
such Holder furnished to the Company by or on behalf of such Holder
specifically for inclusion in the documents referred to in the
foregoing indemnity. This indemnity agreement set forth in this
Section shall be in addition to any liabilities which any such
Holder may otherwise have. In no event shall any Holder, its
directors, officers or employees or any person who controls such
Holder be liable or responsible for any amount in excess of the
amount by which the total amount received by such Holder with
respect to its sale of Transfer Restricted Securities pursuant to a
Shelf Registration Statement exceeds the amount of any damages that
such Holder, its directors, officers or employees or any person who
controls such Holder has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged
omission.
(c) Promptly after receipt by an indemnified party under this
Section 6 of notice of any claim or the commencement of any action,
the indemnified party shall, if a claim in respect thereof is to be
made against the indemnifying party under this Section 6, notify the
indemnifying party in writing of the claim or the commencement of
that action; provided, however, that the failure to notify the
indemnifying party shall not relieve it from any liability which it
may have under this Section 6 except to the
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extent it has been materially prejudiced by such failure and,
provided, further, that the failure to notify the indemnifying party
shall not relieve it from any liability which it may have to an
indemnified party otherwise than under this Section 6. If any such
claim or action shall be brought against an indemnified party, and
it shall notify the indemnifying party thereof, the indemnifying
party shall be entitled to participate therein and, to the extent
that it wishes, jointly with any other similarly notified
indemnifying party, to assume the defense thereof with counsel
reasonably satisfactory to the indemnified party. After notice from
the indemnifying party to the indemnified party of its election to
assume the defense of such claim or action, the indemnifying party
shall not be liable to the indemnified party under this Section 6
for any legal or other expenses subsequently incurred by the
indemnified party in connection with the defense thereof other than
reasonable costs of investigation; provided, however, that the
Holders shall have the right to employ a single counsel to represent
jointly the Holders and their directors, officers, employees and
controlling persons who may be subject to liability arising out of
any claim in respect of which indemnity may be sought by the Holders
against the Company under this Section 6 if the Holders seeking
indemnification shall have been advised by legal counsel that there
may be one or more legal defenses available to such Holders and
their respective directors, officers, employees and controlling
persons that are different from or additional to those available to
the Company, and in that event, the fees and expenses of such
separate counsel shall be paid by the Company.
(d) The indemnifying party under this Section shall not be
liable for any settlement of any proceeding effected without its
written consent, which shall not be withheld unreasonably, but if
settled with such consent or if there is a final judgment for the
plaintiff, the indemnifying party agrees to indemnify the
indemnified party against any loss, claim, damage, liability or
expense by reason of such settlement or judgment. Notwithstanding
the foregoing sentence, if at any time an indemnified party shall
have requested an indemnifying party to reimburse the indemnified
party for fees and expenses of counsel as contemplated by Section
6(c) hereof, the indemnifying party agrees that it shall be liable
for any settlement of any proceeding effected without its written
consent if (i) such settlement is entered into more than 30 days
after receipt by such indemnifying party of the aforesaid request
and (ii) such indemnifying party shall not have reimbursed the
indemnified party in accordance with such request prior to the date
of such settlement. No indemnifying party shall, without the prior
written consent of the indemnified party, effect any settlement,
compromise or consent to the entry of judgment in any pending or
threatened action, suit or proceeding in respect of which any
indemnified party is or could have been a party and indemnity was or
could have been sought hereunder by such indemnified party, unless
such settlement, compromise or consent (x) includes an unconditional
release of
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such indemnified party from all liability on claims that are the
subject matter of such action, suit or proceeding and (y) does not
include a statement as to or an admission of fault, culpability or a
failure to act by or on behalf of any indemnified party.
(e) If the indemnification provided for in this Section 6
shall for any reason be unavailable or insufficient to hold harmless
an indemnified party under Section 6(a) or 6(b) in respect of any
loss, claim, damage or liability (or action in respect thereof)
referred to therein, each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid
or payable by such indemnified party as a result of such loss,
claim, damage or liability (or action in respect thereof):
(i) in such proportion as is appropriate to reflect the
relative benefits received by the Company from the offering
and sale of the Transfer Restricted Securities on the one hand
and a Holder with respect to the sale by such Holder of the
Transfer Restricted Securities on the other, or
(ii) if the allocation provided by Section (6)(d)(i) is
not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred
to in Section 6(d)(i) but also the relative fault of the
Company on the one hand and the Holders on the other in
connection with the statements or omissions or alleged
statements or alleged omissions that resulted in such loss,
claim, damage or liability (or action in respect thereof), as
well as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and a Holder on
the other with respect to such offering and such sale shall be deemed to be in
the same proportion as the total net proceeds from the offering of the
Securities purchased under the Purchase Agreement (before deducting expenses)
received by the Company, on the one hand, bear to the total proceeds received by
such Holder with respect to its sale of Transfer Restricted Securities on the
other. The relative fault of the parties shall be determined by reference to
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 on the one hand or the Holders on the other, the intent
of the parties and their relative knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company and
each Holder agree that it would not be just and equitable if the amount of
contribution pursuant to this Section 6(e) 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 first sentence of this paragraph
(e).
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The amount paid or payable by an indemnified party as a result of the
loss, claim, damage or liability, or action in respect thereof, referred to
above in this Section 6 shall be deemed to include, for purposes of this Section
6, any legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending or preparing to defend any such
action or claim.
Notwithstanding the provisions of this Section 6, no Holder shall be
required to contribute any amount in excess of the amount by which the total
price at which the Transfer Restricted Securities purchased by it were resold
exceeds the amount of any damages which such Holder has otherwise been required
to pay by reason of any untrue or alleged untrue statement or omission or
alleged omission. No Person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any Person who was not guilty of such fraudulent
misrepresentation. The Holders' obligations to contribute as provided in this
Section 6(d) are several and not joint.
(f) The provisions of this Section 6 shall remain in full force and
effect, regardless of any investigation made by or on behalf of any Holder
or the Company or any of the officers, directors or controlling persons
referred to in Section 6 hereof, and will survive the sale by a Holder of
Transfer Restricted Securities.
7. Rule 144A and Rule 144. The Company agrees with each Holder, for so
long as any Transfer Restricted Securities remain outstanding and during any
period in which the Company (i) is not subject to Section 13 or 15(d) of the
Exchange Act, to make available, upon request of any Holder, to such Holder or
beneficial owner of Transfer Restricted Securities in connection with any sale
thereof and any prospective purchaser of such Transfer Restricted Securities
designated by such Holder or beneficial owner, the information required by Rule
144A(d)(4) under the Securities Act in order to permit resales of such Transfer
Restricted Securities pursuant to Rule 144A, and (ii) is subject to Section 13
or 15 (d) of the Exchange Act, to make all filings required thereby in a timely
manner in order to permit resales of such Transfer Restricted Securities
pursuant to Rule 144.
8. No Participation In Underwritten Registrations. No Holder may
participate in any Underwritten Registration hereunder.
9. Miscellaneous.
(a) Remedies. The Company acknowledges and agrees that any failure
by the Company to comply with its obligations under Section 2 hereof may
result in material irreparable injury to the Initial Purchasers or the
Holders for which there is no adequate remedy at law, that it will not be
possible to measure damages for such injuries precisely, and that, in the
event of any such failure, the Initial Purchasers or any Holder may obtain
such relief as may be required to specifically enforce the Company's
21
obligations under Section 2 hereof. The Company further agrees to waive
the defense in any action for specific performance that a remedy at law
would be adequate.
(b) Actions Affecting Transfer Restricted Securities. The Company
shall not, directly or indirectly, take any action with respect to the
Transfer Restricted Securities as a class that would adversely affect the
ability of the Holders to include such Transfer Restricted Securities in a
registration undertaken pursuant to this Agreement.
(c) No Inconsistent Agreements. The Company has not, as of the date
hereof, entered into, nor shall it, on or after the date hereof, enter
into, any agreement with respect to its securities that is inconsistent
with the rights granted to the Holders in this Agreement or otherwise
conflicts with the provisions hereof. In addition, the Company shall not
grant to any of its securityholders (other than the Holders in such
capacity) the right to include any of its securities in the Shelf
Registration Statement provided for in this Agreement other than the
Transfer Restricted Securities.
(d) Amendments and Waivers. This Agreement may not be amended,
modified or supplemented, and waivers or consents to or departures from
the provisions hereof may not be given, unless the Company has obtained
the written consent of a Majority of Holders; provided, however, that with
respect to any matter that directly or indirectly adversely affects the
rights of any Initial Purchaser hereunder, the Company shall obtain the
written consent of each such Initial Purchaser against which such
amendment, qualification, supplement, waiver or consent is to be
effective. Notwithstanding the foregoing (except the foregoing proviso), a
waiver or consent to depart from the provisions hereof, with respect to a
matter, which relates exclusively to the rights of Holders whose
securities are being sold pursuant to a Shelf Registration Statement and
does not directly or indirectly adversely affect the rights of other
Holders, may be given by the Majority Holders, determined on the basis of
Notes or Common Stock being sold rather than registered under such Shelf
Registration Statement.
(e) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand delivery, first class
mail (registered or certified, return receipt requested), telex, facsimile
transmission, or air courier guaranteeing overnight delivery:
(i) if to a Holder, at the address set forth on the records of
the registrar under the Indenture or the transfer agent of the
Common Stock, as the case may be; and
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(ii) if to the Company, initially at its address set forth in
the Purchase Agreement,
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five Business
Days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if telexed; when receipt acknowledged, if transmitted by
facsimile; and on the next Business Day, if timely delivered to an air courier
guaranteeing overnight delivery.
Any party hereto may change the address for receipt of communications by
giving written notice to the others.
(f) Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each of the
parties, including without limitation and without the need for an express
assignment, subsequent Holders. The Company hereby agrees to extend the
benefit of this Agreement to any Holder and any such Holder may
specifically enforce the provisions of this Agreement as if an original
party hereto.
(g) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
(h) Transfer Restricted Securities Held by the Company or Their
Affiliates. Whenever the consent or approval of Holders of a specified
percentage of Transfer Restricted Securities is required hereunder,
Transfer Restricted Securities held by the Company or its Affiliates
(other than subsequent Holders if such subsequent Holders are deemed to be
Affiliates solely by reason of their holding of such Transfer Restricted
Securities) shall not be counted in determining whether such consent or
approval was given by the Holders of such required percentage.
(i) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(j) Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York.
(k) Severability. If any one or more of the provisions contained
herein, or the application thereof in any circumstance, is held invalid,
illegal or unenforceable, the validity, legality and enforceability of any
such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby, it being
23
intended that all of the rights and privileges of the parties shall be
enforceable to the fullest extent permitted by law.
(l) Entire Agreement. This Agreement is intended by the parties as a
final expression of their agreement and intended to be a complete and
exclusive statement of the agreement and understanding of the parties
hereto in respect of the subject matter contained herein. There are no
restrictions, promises, warranties or undertakings, other than those set
forth or referred to herein with respect to the registration rights
granted by the Company with respect to the Transfer Restricted Securities.
This Agreement supersedes all prior agreements and understandings between
the parties with respect to such subject matter.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
MAXTOR CORPORATION
By:/s/ Xxxx X. Xxxxxx
----------------------------------
Name: Xxxx X. Xxxxxx
Title: President, Chief Executive
Officer and Acting Chief
Financial Officer
BANC OF AMERICA SECURITIES LLC
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
Acting as Representatives of the
several Initial Purchasers named in
Schedule A to the Purchase Agreement.
BANC OF AMERICA SECURITIES LLC
By: /s/ Xxxxx Xxxxxx
-----------------------------
Name: Xxxxx Xxxxxx
Title: Managing Director
