Exhibit 99.1
EXECUTION COPY
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REGISTRATION RIGHTS AGREEMENT
Dated as of August 15, 2005
by
The Potomac Edison Company
and
Credit Suisse First Boston LLC
Banc of America Securities LLC
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This Registration Rights Agreement (this "Agreement") is made and
entered into as of August 15, 2005, by The Potomac Edison Company, a Maryland
and Virginia corporation (the "Company"), and Credit Suisse First Boston LLC,
as representative of the Initial Purchasers (the "Initial Purchasers") listed
on Schedule I to the Purchase Agreement (as defined below).
This Agreement is made pursuant to the Purchase Agreement, dated
August 9, 2005 (the "Purchase Agreement"), between the Company, as issuer of
the 5 1/8% First Mortgage Bonds due 2015 (the "Restricted Bonds"), and Credit
Suisse First Boston LLC, as representative of the Initial Purchasers, which
provides for, among other things, the sale by the Company and the purchase by
the Initial Purchasers of $145,000,000 aggregate principal amount of Restricted
Bonds. In order to induce the Initial Purchasers to purchase the Restricted
Bonds, the Company has agreed to provide the registration rights set forth in
this Agreement. The execution and delivery of this Agreement is a condition to
the obligations of the Initial Purchasers set forth in Section 8(g) of the
Purchase Agreement.
The parties hereby agree as follows:
SECTION 1. DEFINITIONS
Capitalized terms used but not defined herein shall have the meanings
ascribed to such terms in the Purchase Agreement. As used in this Agreement,
the following capitalized terms shall have the following meanings:
Act: The Securities Act of 1933, as amended.
Advice: As defined in Section 6(d) hereof.
Agreement: As defined in the first paragraph hereof.
Bonds: The Restricted Bonds and the Exchange Bonds.
Broker-Dealer: Any broker or dealer registered under the Exchange Act.
Broker-Dealer Transfer Restricted Securities: Exchange Bonds that are
acquired by a Broker-Dealer in the Exchange Offer in exchange for Restricted
Bonds that such Broker-Dealer acquired for its own account as a result of
market-making activities or other trading activities (other than Restricted
Bonds acquired directly from the Company or any of its affiliates).
Business Day: Any day except a Saturday, Sunday or other day in the
City of New York, on which banks are authorized to close.
Certificated Securities: Bonds that are not in Global Bond form.
Closing Date: The date hereof.
Commission: The Securities and Exchange Commission.
Company: As defined in the first paragraph hereof.
Consummate: An Exchange Offer shall be deemed "Consummated" for
purposes of this Agreement upon the occurrence of (a) the filing and
effectiveness under the Act of the Exchange Offer Registration Statement
relating to the Exchange Bonds to be issued in the Exchange Offer, (b) the
maintenance of such Exchange Offer Registration Statement continuously
effective and the keeping of the Exchange Offer open for a period not less than
the minimum period in each case required pursuant to Section 3(b) hereof, and
(c) the delivery by the Company to the Trustee of the Exchange Bonds in the
same aggregate principal amount as the aggregate principal amount of the
Restricted Bonds validly tendered by Holders thereof pursuant to the Exchange
Offer.
Damages Payment Date: With respect to the Restricted Bonds, each
Interest Payment Date.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Exchange Bonds: The Company's 5 1/8% First Mortgage Bonds due 2015, to
be issued pursuant to the Indenture (i) in the Exchange Offer or (ii) upon the
request of any Holder of Restricted Bonds covered by a Shelf Registration
Statement, in exchange for such Restricted Bonds.
Exchange Offer: The registration by the Company under the Act of the
Exchange Bonds pursuant to the Exchange Offer Registration Statement pursuant
to which the Company shall offer the Holders of all outstanding Transfer
Restricted Securities the opportunity to exchange all such outstanding Transfer
Restricted Securities for Exchange Bonds in an aggregate principal amount equal
to the aggregate principal amount of the Transfer Restricted Securities validly
tendered and not properly withdrawn in such exchange offer by such Holders.
Exchange Offer Registration Statement: The Registration Statement
relating to the Exchange Offer, including the related Prospectus.
Exempt Resales: The transactions in which the Initial Purchasers
propose to sell the Restricted Bonds to certain "qualified institutional
buyers", as such term is defined in Rule 144A under the Act, or to persons who
are not "U.S. persons", as such term is defined in Regulation S under the Act.
Global Bond: As defined in the Supplemental Indenture.
Holder: As defined in Section 2 hereof.
Indenture: Indenture, dated as of October 1, 1944, between the
Company, the Trustee and Xxxxxx X. Xxxxx, as individual trustee, as
supplemented by various supplemental indentures, including the Supplemental
Indenture.
Initial Purchasers: As defined in the first paragraph hereof.
Interest Payment Date: As defined in the Supplemental Indenture.
NASD: National Association of Securities Dealers, Inc.
Person: An individual, partnership, corporation, trust, limited
liability company, unincorporated organization, or a government or agency or
political subdivision thereof.
Prospectus: The prospectus included in a Registration Statement at the
time such Registration Statement is declared effective, 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.
Purchase Agreement: As defined in the second paragraph hereof.
Record Holder: With respect to any Damages Payment Date, each Person
who is a Holder of Bonds on the record date with respect to the Interest
Payment Date on which such Damages Payment Date shall occur.
Registration Default: As defined in Section 5 hereof.
Registration Statement: Any registration statement of the Company
relating to (a) an offering of Exchange Bonds pursuant to an Exchange Offer or
(b) the registration for resale of Transfer Restricted Securities pursuant to
the Shelf Registration Statement, in each case, (i) which is filed pursuant to
the provisions of this Agreement and (ii) including the Prospectus included
therein, all amendments and supplements thereto (including post-effective
amendments) and all exhibits and material incorporated by reference therein.
Restricted Broker-Dealer: Any Broker-Dealer which holds Broker-Dealer
Transfer Restricted Securities.
Restricted Bonds: As defined in the first paragraph hereof (and shall
be deemed to include any additional Restricted Bonds issued after the Closing
Date and prior to the consummation of the Exchange Offer).
S-3 Ineligibility Date: As defined in Section 12(l) hereof.
Shelf Registration Statement: As defined in Section 4(a) hereof.
Supplemental Indenture: One-hundred-fifth (105th) supplemental
indenture, dated as of August 15, 2005, to the Indenture.
TIA: The Trust Indenture Act of 1939 (15 U.S.C. Sections
77aaa-77bbbb), as amended.
Transfer Restricted Securities: Each Restricted Bond, until the
earliest to occur of (a) the date on which such Restricted Bond is exchanged in
the Exchange Offer and entitled to be resold to the public by the Holder
thereof without complying with the prospectus delivery requirements of the Act,
(b) the date on which such Restricted Bond has been disposed of in accordance
with a Shelf Registration Statement, (c) the date on which such Restricted Bond
is disposed of by a Broker-Dealer pursuant to the "Plan of Distribution"
contemplated by the Exchange Offer Registration Statement (including delivery
of the Prospectus contained therein) or (d) the date on which such Restricted
Bond is sold pursuant to Rule 144 under the Act or is eligible to be sold
pursuant to Rule 144(k) under the Act.
Trustee: JPMorgan Chase Bank, N.A. (ultimate successor to Chemical
Bank & Trust Company), as one of the trustees under the Indenture.
Underwritten Offering or Underwritten Registration: An offering or
registration in which securities of the Company are sold to an underwriter for
reoffering to the public.
SECTION 2. HOLDERS
A Person is deemed to be a holder of Transfer Restricted Securities
(each, a "Holder") whenever such Person is the beneficial owner of Transfer
Restricted Securities.
SECTION 3. REGISTERED EXCHANGE OFFER
(a) Unless the Exchange Offer shall not be permitted by applicable
federal law, the Company shall (i) cause to be filed with the Commission no
later than 180 days after the Closing Date (unless such day is not a Business
Day, then the next succeeding Business Day), the Exchange Offer Registration
Statement, (ii) use its reasonable best efforts to cause such Exchange Offer
Registration Statement to become effective no later than 300 days after the
Closing Date (unless such day is not a Business Day, then the next succeeding
Business Day), (iii) in connection with the foregoing, (A) file all
pre-effective amendments to such Exchange Offer Registration Statement as may
be necessary in order to cause such Exchange Offer Registration Statement to
become effective, (B) file, if applicable, a post-effective amendment to such
Exchange Offer Registration Statement pursuant to Rule 430A under the Act and
(C) cause all necessary filings, if any, in connection with the registration
and qualification of the Exchange Bonds to be made under the blue sky laws of
such jurisdictions as are necessary to permit Consummation of the Exchange
Offer, and (iv) upon the effectiveness of such Exchange Offer Registration
Statement, commence and Consummate the Exchange Offer. The Exchange Offer shall
be on the appropriate form permitting registration of the Exchange Bonds to be
offered in exchange for the Restricted Bonds that are Transfer Restricted
Securities and to permit sales of Broker-Dealer Transfer Restricted Securities
by Restricted Broker-Dealers as contemplated by Section 3(c) hereof.
(b) The Company shall use its reasonable best efforts to cause the
Exchange Offer Registration Statement to be effective continuously during the
period that the Exchange Offer is open, and shall keep the Exchange Offer open
for a period of not less than the minimum period required under applicable
federal and state securities laws to Consummate the Exchange Offer; provided,
however, that in no event shall the Exchange Offer be open for less than 20
Business Days. The Company shall cause the Exchange Offer to comply with all
applicable federal and state securities laws. The Company shall use its
reasonable best efforts to cause the Exchange Offer to be Consummated on the
earliest practicable date after the Exchange Offer Registration Statement has
become effective, but in no event later than 45 days thereafter.
(c) The Company shall include a "Plan of Distribution" section in
the Prospectus substantially in the form attached as Exhibit A hereto with such
additions and deletions as the Commission may request.
The Company shall use its reasonable best efforts to keep the Exchange
Offer Registration Statement continuously effective, supplemented and amended
as required by the provisions of Section 6(c) hereof to the extent necessary to
ensure that it is available for sales of Broker-Dealer Transfer Restricted
Securities by Restricted Broker-Dealers, and to ensure that such Registration
Statement conforms with the requirements of this Agreement, the Act and the
policies, rules and regulations of the Commission as announced from time to
time, for a period of 180 days from the date on which the Exchange Offer is
Consummated.
The Company shall promptly provide sufficient copies of the latest
version of such Prospectus to such Restricted Broker-Dealers promptly upon
request, and in no event later than one business day after such request, at any
time during such 180 day period in order to facilitate such sales.
SECTION 4. SHELF REGISTRATION
(a) Shelf Registration. If (i) the Company is not required to file
an Exchange Offer Registration Statement with respect to the Exchange Bonds
because the Exchange Offer is not permitted by applicable law or Commission
policy or (ii) any Holder of Transfer Restricted Securities shall notify the
Company within 5 Business Days following the Consummation of the Exchange Offer
that (A) such Holder was prohibited by law or Commission policy from
participating in the Exchange Offer or (B) such Holder may not resell the
Exchange Bonds acquired by it in the Exchange Offer to the public without
delivering a prospectus and the Prospectus contained in the Exchange Offer
Registration Statement is not appropriate or available for such resales by such
Holder, the Company shall, if, and when, the Company is eligible to use Form
S-3 under the Act (unless Section 12(l) otherwise applies), (x) cause to be
filed on or prior to 90 days after the date on which the Company determines
that it is not required to file the Exchange Offer Registration Statement
pursuant to clause (i) above or 90 days after the date on which the Company
receives the notice specified in clause (ii) above a shelf registration
statement pursuant to Rule 415 under the Act (which may be an amendment to the
Exchange Offer Registration Statement (in either event, the "Shelf Registration
Statement")), relating to all Transfer Restricted Securities the Holders of
which shall have provided the information required pursuant to Section 4(b)
hereof, and (y) use its reasonable best efforts to cause such Shelf
Registration Statement to become effective on or prior to 180 days after the
date on which the Company becomes obligated to file such Shelf Registration
Statement. If, after the Company has filed an Exchange Offer Registration
Statement which satisfies the requirements of Section 3(a) hereof, the Company
is required to file and make effective a Shelf Registration Statement solely
because the Exchange Offer shall not be permitted under applicable federal law,
then the filing of the Exchange Offer Registration Statement shall be deemed to
satisfy the requirements of clause (x) above. Such an event shall have no
effect on the requirements of clause (y) above. The Company shall use its
reasonable best efforts to keep the Shelf Registration Statement discussed in
this Section 4(a) continuously effective, supplemented and amended as required
by and subject to the provisions of Sections 6(b) and (c) hereof to the extent
necessary to ensure that it is available for sales of Transfer Restricted
Securities by the Holders thereof entitled to the benefit of this Section 4(a),
and to ensure that it conforms with the requirements of this Agreement, the Act
and the policies, rules and regulations of the Commission as announced from
time to time, for a period of at least two years (as extended pursuant to
Section 6(c)(i) hereof) following the date on which such Shelf Registration
Statement first becomes effective under the Act, or such shorter period of time
that will terminate when all of the Transfer Restricted Securities covered by
the Shelf Registration Statement have been sold pursuant thereto, or have been
sold pursuant to Rule 144 in situations where the restrictive legend has been
removed or are eligible to be sold pursuant to Rule 144(k) of the Act.
(b) Provision by Holders of Certain Information in Connection with
the Shelf Registration Statement. No Holder of Transfer Restricted Securities
may include any of its Transfer Restricted Securities in any Shelf Registration
Statement pursuant to this Agreement unless and until such Holder furnishes to
the Company in writing, within 5 Business Days after receipt of a request
therefor, such information specified in Item 507 of Regulation S-K for use in
connection with any Shelf Registration Statement or Prospectus or preliminary
Prospectus included therein. No Holder of Transfer Restricted Securities shall
be entitled to liquidated damages pursuant to Section 5 hereof unless and until
such Holder shall have used its reasonable best efforts to provide all such
information. Each Holder as to which any Shelf Registration Statement is being
effected agrees to furnish promptly to the Company all information required to
be disclosed in order to make the information previously furnished to the
Company by such Holder not materially misleading.
SECTION 5. LIQUIDATED DAMAGES
If (i) any Registration Statement required by this Agreement is not
filed with the Commission on or prior to the date specified for such filing in
this Agreement, (ii) any such Registration Statement has not been declared
effective by the Commission on or prior to the date specified for such
effectiveness in this Agreement, (iii) the Exchange Offer has not been
Consummated within 45 calendar days after the Exchange Offer Registration
Statement is first declared effective by the Commission or (iv) any
Registration Statement required by this Agreement is filed and declared
effective but shall thereafter cease to be effective (if the requirement to be
effective remains in effect) or fail to be usable for its intended purpose
without being succeeded within 20 Business Days by a post-effective amendment
or supplement to such Registration Statement or a successor registration
statement that cures such failure and that is itself declared effective within
10 Business Days (each such event referred to in clauses (i) through (iv), a
"Registration Default"), then the Company agrees to pay liquidated damages in
the form of additional interest on the Transfer Restricted Securities to each
Holder of Transfer Restricted Securities, during the period of one or more such
Registration Defaults, from and including the date on which any Registration
Default shall occur to, but excluding, the date on which such Registration
Default has been cured, at a rate of 0.25% per annum during the 90-day period
immediately following the occurrence of such Registration Default and shall
increase by 0.25% per annum with respect to each subsequent 90-day period until
all Registration Defaults have been cured, but in no event shall such rate
exceed 0.50% per annum. Notwithstanding anything to the contrary set forth
herein, (1) upon filing of the Exchange Offer Registration Statement (and/or,
if applicable, the Shelf Registration Statement), in the case of clause (i)
above, (2) upon the effectiveness of the Exchange Offer Registration Statement
(and/or, if applicable, the Shelf Registration Statement), in the case of
clause (ii) above, (3) upon Consummation of the Exchange Offer, in the case of
clause (iii) above, or (4) upon the filing of a post-effective amendment to the
Registration Statement or an additional Registration Statement that causes the
Exchange Offer Registration Statement (and/or, if applicable, the Shelf
Registration Statement) to again be declared effective or made usable, in the
case of clause (iv) above, the accrual of liquidated damages payable with
respect to the Transfer Restricted Securities as a result of such clause (i),
(ii), (iii) or (iv), as applicable, shall cease, however, the obligation to pay
accrued but unpaid liquidated damages will remain.
All additional interest shall be paid on each Damages Payment Date to
the Record Holder of Global Bonds by wire transfer of immediately available
funds or by federal funds check and to Record Holders of Certificated
Securities by mailing checks to their registered addresses on the books of the
Company or the Trustee for such payment. All obligations of the Company set
forth in the preceding paragraph that are outstanding with respect to any
Transfer Restricted Security at the time such security ceases to be a Transfer
Restricted Security shall survive until such time as all such obligations with
respect to such security shall have been satisfied in full. For the avoidance
of doubt, liquidated damages will cease to accrue on any security once it is no
longer a Transfer Restricted Security.
SECTION 6. REGISTRATION PROCEDURES
(a) Exchange Offer Registration Statement. In connection with the
Exchange Offer, the Company shall comply with the applicable provisions of
Section 6(c) hereof, shall use its reasonable best efforts to effect such
exchange and to permit the sale of Broker-Dealer Transfer Restricted Securities
being sold in accordance with the intended method or methods of distribution
thereof, and shall comply with all of the following provisions:
(i) Reserved.
(ii) As a condition to its participation in the Exchange
Offer pursuant to the terms of this Agreement, each Holder of Transfer
Restricted Securities shall furnish to the Company, prior to the
Consummation of the Exchange Offer, a written representation to the
Company (which may be contained in the letter of transmittal or
similar document contemplated by the Exchange Offer Registration
Statement) to the effect that (A) it is not an affiliate of the
Company, (B) it is not engaged in, and does not intend to engage in,
and has no arrangement or understanding with any Person to participate
in, a distribution of the Exchange Bonds to be issued in the Exchange
Offer and (C) it is acquiring the Exchange Bonds in its ordinary
course of business. Each Holder hereby acknowledges and agrees that
any Broker-Dealer and any such Holder using the Exchange Offer to
participate in a distribution of the securities to be acquired in the
Exchange Offer (1) could not under Commission policy as in effect on
the date of this Agreement rely on the position of the Commission
enunciated in Xxxxxx Xxxxxxx and Co. Inc. (available June 5, 1991) and
Exxon Capital Holdings Corp. (available May 13, 1988), as interpreted
in the Commission's letter to Shearman & Sterling (available July 2,
1993), and similar no-action letters, and (2) must comply with the
registration and prospectus delivery requirements of the Act in
connection with a secondary resale transaction and that such a
secondary resale transaction must be covered by an effective
registration statement containing the selling security holder
information required by Item 507 or 508, as applicable, of Regulation
S-K if the resales are of Exchange Bonds obtained by such Holder in
exchange for Restricted Bonds acquired by such Holder directly from
the Company or an affiliate thereof.
(iii) Prior to effectiveness of the Exchange Offer
Registration Statement, the Company shall provide a supplemental
letter to the Commission (A) stating that the Company is registering
the Exchange Offer in reliance on the position of the Commission
enunciated in Exxon Capital Holdings Corp. (available May 13, 1988),
Xxxxxx Xxxxxxx and Co. Inc. (available June 5, 1991), and (B)
including a representation that the Company has not entered into any
arrangement or understanding with any Person to distribute the
Exchange Bonds to be received in the Exchange Offer and that, to the
best of the Company's information and belief, each Holder
participating in the Exchange Offer is acquiring the Exchange Bonds in
its ordinary course of business and has no arrangement or
understanding with any Person to participate in the distribution of
the Exchange Bonds received in the Exchange Offer.
(b) Shelf Registration Statement. In connection with the Shelf
Registration Statement, the Company shall comply with the provisions of Section
6(c) hereof and shall use its reasonable best efforts to effect such
registration to permit the sale of the Transfer Restricted Securities being
sold in accordance with the intended method or methods of distribution thereof
(as indicated in the information furnished to the Company pursuant to Section
4(b) hereof), and pursuant thereto the Company will prepare and file with the
Commission a Registration Statement relating to the registration on any
appropriate form under the Act, which form shall be available for the sale of
the Transfer Restricted Securities in accordance with the intended method or
methods of distribution thereof within the time periods and otherwise in
accordance with the provisions hereof.
(c) General Provisions. In connection with any Registration
Statement (unless limited to the Exchange Offer Registration Statement or Shelf
Registration Statement below) and any related Prospectus required by this
Agreement to permit the sale or resale of Transfer Restricted Securities
(including, without limitation, any Exchange Offer Registration Statement and
the related Prospectus, to the extent that the same are required to be
available to permit sales of Broker-Dealer Transfer Restricted Securities by
Restricted Broker-Dealers), the Company shall:
(i) use its reasonable best efforts to keep such
Registration Statement continuously effective and provide all
requisite financial statements for the period specified in Section 3
or 4 hereof, as applicable. Upon the occurrence of any event that
would cause any such 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 period required by this Agreement,
the Company shall file promptly an appropriate amendment or supplement
to such Registration Statement, (1) in the case of clause (A),
correcting any such misstatement or omission, and (2) in the case of
clauses (A) and (B), using its reasonable best efforts to cause such
amendment to be declared effective and such Registration Statement and
the related Prospectus to become usable for their intended purpose(s)
as soon as reasonably practicable thereafter;
(ii) prepare and file with the Commission such amendments,
supplements and post-effective amendments to the Registration
Statement as may be necessary to keep the Registration Statement
effective for the applicable period set forth in Section 3 or 4
hereof, or such shorter period as will terminate when all Transfer
Restricted Securities covered by such Registration Statement have been
sold; cause the Prospectus to be supplemented by any required
prospectus supplement, and as so supplemented to be filed pursuant to
Rule 424 under the Act, and to comply fully with Rules 424, 430A and
462, as applicable, under the Act in a timely manner; and comply with
the provisions of the Act with respect to the disposition of all
securities covered by such Registration Statement during the
applicable period in accordance with the intended method or methods of
distribution by the sellers thereof set forth in such Registration
Statement or supplement to the Prospectus;
(iii) for a period of 180 days after the Exchange Offer has
been Consummated (in the case of an Exchange Offer Registration
Statement) or 180 days after the Shelf Registration Statement is
declared effective (in the case of a Shelf Registration Statement), or
in each case for such shorter period of time that will terminate when
all of the Transfer Restricted Securities covered by the applicable
Registration Statement have been sold, advise one counsel for the
Initial Purchasers (in the case of an Exchange Offer Registration
Statement) and the underwriter(s), if any, and selling Holders
included in a Shelf Registration Statement promptly and, if requested
by such Persons, confirm such advice in writing, (A) when the
Prospectus or any prospectus supplement or post-effective amendment
has been filed, and, with respect to any 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
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
Registration Statement under the 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, (D) of the
existence of any fact or the happening of any event that makes any
statement of a material fact made in the 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 Registration Statement in order
to make the statements therein not misleading, or that requires the
making of any additions to or changes in the Prospectus in order to
make the statements therein, in the light of the circumstances under
which they were made, not misleading. If at any time the Commission
shall issue any stop order suspending the effectiveness of the
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;
(iv) for a period of 180 days after the Exchange Offer has
been Consummated (in the case of an Exchange Offer Registration
Statement) or 180 days after the Shelf Registration Statement is
declared effective (in the case of a Shelf Registration Statement), or
in each case for such shorter period of time that will terminate when
all of the Transfer Restricted Securities covered by the applicable
Registration Statement have been sold, furnish to one counsel for the
Initial Purchasers (in the case of an Exchange Offer Registration
Statement) and each selling Holder named in any Shelf Registration
Statement or Prospectus and each of the underwriter(s) (or any person
who may be deemed to be an underwriter under the Act) in connection
with such sale, if any, before filing with the Commission, copies of
any Registration Statement or any Prospectus included therein or any
amendments or supplements to any such Registration Statement or
Prospectus (except that, in the case of a Shelf Registration
Statement, documents incorporated by reference will only be provided
to any underwriter, which documents will be subject to the review and
comment of such underwriter(s) in connection with such sale, if any,
for a period of at least two Business Days (or one Business Day with
respect to any Current Report on Form 8-K, other than a Form 8-K to be
filed pursuant to Regulation FD under the Exchange Act for which oral
notice shall suffice), and the Company will not file any such
Registration Statement or Prospectus or any amendment or supplement to
any such Registration Statement or Prospectus to which the selling
Holders of the Transfer Restricted Securities covered by such
Registration Statement or the underwriter(s) in connection with such
sale, if any, shall reasonably object within two Business Days (or one
Business Day with respect to any Current Report on Form 8-K, other
than a Form 8-K to be filed pursuant to Regulation FD under the
Exchange Act for which oral notice shall suffice) after the receipt
thereof;
(v) Reserved;
(vi) in the case of any Shelf Registration Statement, make
available at reasonable times for inspection by the selling Holders
and any managing underwriter (or any person who may be deemed to be an
underwriter under the Act) participating in any disposition pursuant
to such Shelf Registration Statement and any attorney or accountant
retained by such selling Holders or any of such underwriter(s), all
financial and other records, material corporate documents and
properties of the Company and cause the Company's officers, directors
and employees to supply all information reasonably requested by any
such Holder, underwriter, attorney or accountant in connection with
such Shelf Registration Statement, or any post-effective amendment
thereto subsequent to the filing thereof and prior to its
effectiveness, in each case, that would customarily be reviewed or
examined in connection with a "due diligence" review of the Company;
provided however, that each such party shall be required to maintain
confidences and not to disclose to any other person any information or
records reasonably designated by the Company as confidential unless so
required by statute, law, rule, regulation, judgment, order or decree
of any court, regulatory body, administrative agency or governmental
body;
(vii) if reasonably requested by any selling Holders or the
underwriter(s) (or any person who may be deemed to be an underwriter
under the Act) in connection with such sale, if any, promptly include
in any Registration Statement or Prospectus, pursuant to a supplement
or post-effective amendment if necessary, such information as such
selling Holders and underwriter(s), if any, may reasonably request to
have included therein, including, without limitation, information
relating to the "Plan of Distribution" of the Transfer Restricted
Securities, information with respect to the principal amount of
Transfer Restricted Securities being sold to such underwriter(s), the
purchase price being paid therefor and any other terms of the offering
of the Transfer Restricted Securities to be sold in such offering; and
make all required filings of such Prospectus supplement or
post-effective amendment as soon as reasonably practicable after the
Company is notified of the matters to be included in such Prospectus
supplement or post-effective amendment;
(viii) if requested in writing by any selling Holder and
each of the underwriter(s) (or any person who may be deemed to be an
underwriter under the Act) in connection with such sale, if any,
furnish, without charge, at least one copy of the Registration
Statement, as first filed with the Commission, and of each amendment
thereto (without documents incorporated therein by reference or
exhibits incorporated therein by reference, unless otherwise
requested);
(ix) if requested in writing by any selling Holder and
each of the underwriter(s), if any (or any person who may be deemed to
be an underwriter under the Act), deliver, without charge, as many
copies of the Prospectus (including each preliminary Prospectus) and
any amendment or supplement thereto as such Persons reasonably may
request; the Company hereby consents to the use (in accordance with
law) of the Prospectus and any amendment or supplement thereto by each
of the selling Holders and each of the underwriter(s), if any, in
connection with the offering and the sale of the Transfer Restricted
Securities covered by the Prospectus or any amendment or supplement
thereto;
(x) enter into such agreements (including an underwriting
or similar agreement) and make such representations and warranties and
take all such other actions in connection therewith in order to
expedite or facilitate the disposition of the Transfer Restricted
Securities pursuant to any Registration Statement contemplated by this
Agreement as may be reasonably requested by any Holder of Transfer
Restricted Securities or underwriter (or any person who may be deemed
to be an underwriter under the Act) in connection with any sale or
resale pursuant to any Shelf Registration Statement contemplated by
this Agreement, and in such connection, whether or not an underwriting
or similar agreement is entered into and whether or not the
registration is an Underwritten Registration, the Company shall:
(A) furnish (or in the case of clauses (2) and
(3) below, use its reasonable best efforts to furnish) to each
selling Holder and each underwriter, if any (or any person
who may be deemed to be an underwriter under the Act), upon
the effectiveness of the Shelf Registration Statement:
(1) a certificate, dated the date of
effectiveness of the Shelf Registration Statement,
signed on behalf of the Company by (x) the President
or any Vice President and (y) a principal financial
or accounting officer of the Company, confirming, as
of the date thereof, the matters set forth in
Sections 8(e) and 8(f) of the Purchase Agreement and
such other similar matters as the selling Holders or
underwriter(s) may reasonably request;
(2) an opinion, dated the date of
effectiveness of the Shelf Registration Statement,
of counsel for the Company covering matters similar
to those set forth in Section 8(c) of the Purchase
Agreement and such other matters as the selling
Holders or underwriter(s) may reasonably request,
and in any event including a statement to the effect
that such counsel has participated in conferences
with officers and other representatives of the
Company, representatives of the independent
registered public accounting firm of the Company and
have considered the matters required to be stated
therein and the statements contained therein,
although such counsel has not independently verified
the accuracy, completeness or fairness of such
statements; and that such counsel advises that, on
the basis of the foregoing (relying as to
materiality to a large extent upon facts provided to
such counsel by officers and other representatives
of the Company and without independent check or
verification), no facts came to such counsel's
attention that caused such counsel to believe that
the applicable Registration Statement, at the time
such Registration Statement or any post-effective
amendment thereto became effective, contained an
untrue statement of a material fact or omitted to
state a material fact required to be stated therein
or necessary to make the statements therein not
misleading, or that the Prospectus contained in such
Registration Statement as of its date, contained an
untrue statement of a material fact or omitted to
state a material fact necessary in order to make the
statements therein, in the light of the
circumstances under which they were made, not
misleading. Without limiting the foregoing, such
counsel may state further that such counsel assumes
no responsibility for, and has not independently
verified, the accuracy, completeness or fairness of
the financial statements, Bonds and schedules and
other financial data included in any Registration
Statement contemplated by this Agreement or the
related Prospectus; and
(3) if requested by any selling Holder
or underwriter (in the context of a Shelf
Registration Statement), a customary comfort letter,
dated as of the date of effectiveness of the Shelf
Registration Statement, from the Company's
independent registered public accounting firm, in
the customary form and covering matters of the type
customarily covered in comfort letters to
underwriters in connection with primary underwritten
offerings, and affirming the matters set forth in
the comfort letters delivered pursuant to Section
8(d) of the Purchase Agreement, without exception;
(B) set forth in full or incorporate by
reference in the underwriting or similar agreement, if any, in
connection with any sale or resale pursuant to any Shelf
Registration Statement, the indemnification provisions and
procedures of Section 8 hereof with respect to all parties to
be indemnified pursuant to said Section 8; and
(C) deliver such other documents and
certificates as may be reasonably requested by the selling
Holders or the underwriter(s) (or any person who may be deemed
to be an underwriter under the Act), to evidence compliance
with clause (A) above and with any customary conditions
contained in the underwriting agreement or other agreement
entered into by the Company pursuant to this clause (C);
the above shall be done at each closing under such underwriting or similar
agreement, as and to the extent required thereunder, and if at any time the
representations and warranties of the Company contemplated in clause (A)(1)
above cease to be true and correct, the Company shall so advise the
underwriter(s), if any, and the selling Holders promptly and, if requested by
such Persons, shall confirm such advice in writing;
(xi) prior to any public offering of Transfer Restricted
Securities, cooperate with the selling Holders, the underwriter(s), if
any, and their respective counsel in connection with the registration
and qualification of the Transfer Restricted Securities under the
securities or blue sky laws of such jurisdictions as the selling
Holders or underwriter(s), if any, 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 applicable Registration Statement; provided,
however, that the Company shall not be required to register or qualify
as a foreign corporation where it is not now so qualified or to take
any action that would subject it to the service of process in suits or
to taxation, other than as to matters and transactions relating to the
Registration Statement, in any jurisdiction where it is not now so
subject;
(xii) issue, upon the request of any Holder of Restricted
Bonds covered by any Shelf Registration Statement contemplated by this
Agreement, Exchange Bonds having an aggregate principal amount equal
to the aggregate principal amount of Restricted Bonds surrendered to
the Company by such Holder in exchange therefor or being sold by such
Holder; such Exchange Bonds to be registered in the name of such
Holder or in the name of the purchaser(s) of such Bonds, as the case
may be; in return, the Restricted Bonds held by such Holder shall be
surrendered to the Company for cancellation;
(xiii) in connection with any sale of Transfer Restricted
Securities that will result in such securities no longer being
Transfer Restricted Securities, cooperate with the selling Holders and
the underwriter(s), if any (or any person who may be deemed to be an
underwriter under the Act), to facilitate the timely preparation and
delivery of certificates representing Transfer Restricted Securities
to be sold and not bearing any restrictive legends; and to register
such Transfer Restricted Securities in such denominations and such
names as the Holders or the underwriter(s), if any, may request at
least two Business Days prior to such sale of Transfer Restricted
Securities;
(xiv) use its reasonable best efforts to cause the
disposition of the Transfer Restricted Securities covered by the
Registration Statement to be registered with or approved by such other
governmental agencies or authorities as may be necessary to enable the
seller or sellers thereof or the underwriter(s), if any (or any person
who may be deemed to be an underwriter under the Act), to consummate
the disposition of such Transfer Restricted Securities, subject to the
proviso contained in clause (xi) above;
(xv) subject to clause (i) above, if any fact or event
contemplated by clause (iii)(D) above shall exist or have occurred,
prepare a supplement or post-effective amendment to the 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 necessary to make the
statements therein, in the light of the circumstances under which they
were made, not misleading;
(xvi) provide CUSIP numbers for all Transfer Restricted
Securities not later than the effective date of a Registration
Statement covering such Transfer Restricted Securities and provide the
Trustee with printed certificates for the Transfer Restricted
Securities which are in a form eligible for deposit with The
Depository Trust Company;
(xvii) 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 (including any "qualified independent
underwriter" or any person who may be deemed to be an underwriter
under the Act) that is required to be retained in accordance with the
rules and regulations of the NASD, and use its best efforts to cause
such Registration Statement to become effective and approved by such
governmental agencies or authorities as may be necessary to enable the
Holders selling Transfer Restricted Securities to consummate the
disposition of such Transfer Restricted Securities;
(xviii) otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission, and make generally
available to its security holders with regard to any applicable
Registration Statement, as soon as practicable, a consolidated earning
statement meeting the requirements of Rule 158 under the Act (which
need not be audited) covering a twelve-month period beginning after
the effective date of the Registration Statement (as such term is
defined in paragraph (c) of Rule 158 under the Act); and
(xix) cause the Supplemental Indenture to be qualified
under the TIA not later than the effective date of the first
Registration Statement required by this Agreement and, in connection
therewith, cooperate with the Trustee and the Holders of Bonds to
effect such changes to the Supplemental Indenture as may be required
for such Supplemental Indenture to be so qualified in accordance with
the terms of the TIA; and execute and use its best efforts to cause
the Trustee to execute all documents that may be reasonably 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.
(d) Restrictions on Holders. Each Holder agrees by acquisition of
a Transfer Restricted Security that, upon receipt of a notice of actions to be
taken as referred to in Section 6(c)(i) hereof or any notice from the Company
of the existence of any fact of the kind described in Section 6(c)(iii)(D)
hereof, such Holder will forthwith discontinue disposition of Transfer
Restricted Securities pursuant to the applicable Registration Statement until
such Holder's receipt of the copies of the supplemented or amended Prospectus
contemplated by Section 6(c)(xv) hereof, or until it 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 (the "Advice"). 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 Holder's possession, of the Prospectus
covering such Transfer Restricted Securities that was current at the time of
receipt of either such notice. In the event the Company shall give any such
notice, the time period regarding the effectiveness of such Registration
Statement set forth in Section 3 or 4 hereof, as applicable, shall be extended
by the number of days during the period from and including the date of the
giving of such notice pursuant to Section 6(c)(i) or Section 6(c)(iii)(D)
hereof to and including the date when each selling Holder covered by such
Registration Statement shall have received the copies of the supplemented or
amended Prospectus contemplated by Section 6(c)(xv) hereof or shall have
received the Advice.
SECTION 7. REGISTRATION EXPENSES
(a) All expenses incident to the Company's performance of or
compliance with this Agreement will be borne by the Company, regardless of
whether a Registration Statement becomes effective, including without
limitation: (i) all registration and filing fees; (ii) all fees and expenses of
compliance with federal securities and state blue sky or securities laws; (iii)
all expenses of printing (including printing certificates for the Exchange
Bonds to be issued in the Exchange Offer and printing of Prospectuses),
messenger and delivery services and telephone; (iv) all fees and disbursements
of counsel for the Company; (v) all reasonable fees and disbursements of one
counsel for the Initial Purchasers (in connection with an Exchange Offer) not
to exceed $5,000; (vi) all application and filing fees, if any, in connection
with listing the Bonds on a national securities exchange or automated quotation
system pursuant to the requirements hereof; and (vii) all fees and
disbursements of the independent registered public accounting firm of the
Company (including the expenses of any special audit and comfort letters
required by or incident to such performance).
The Company will, in any event, bear its internal expenses (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expenses of any annual audit and
the fees and expenses of any Person, including special experts, retained by the
Company.
(b) In connection with the Shelf Registration Statement, the
Company will reimburse the Holders of Transfer Restricted Securities registered
pursuant to the Shelf Registration Statement for the reasonable fees and
disbursements of not more than one counsel, who shall be chosen by the Holders
of a majority in principal amount of the Transfer Restricted Securities for
whose benefit the Shelf Registration Statement is being prepared in
consultation with the Company.
SECTION 8. INDEMNIFICATION AND CONTRIBUTION
(a) The Company agrees to indemnify and hold harmless each Holder
of Bonds covered by any Registration Statement, each Initial Purchaser, and with
respect to any Prospectus delivery as contemplated in Section 3(c) hereof, each
Restricted Broker-Dealer, the directors, officers, employees, affiliates (as
defined in Rule 144 under the Act) and agents of each such Holder, Initial
Purchaser or Restricted Broker-Dealer and each person who controls any such
Holder, Initial Purchaser or Restricted Broker-Dealer within the meaning of
either the Act or the Exchange Act against any and all losses, claims, damages
or liabilities, joint or several, to which they or any of them may become
subject under the Act, the Exchange Act or other U.S. federal or state
statutory law or regulation, at common law or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise
out of or are based upon any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement as originally filed or in
any amendment thereof, or in any preliminary Prospectus or Prospectus or in any
amendment thereof or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein (in the case of any
preliminary Prospectus or the Prospectus) in the light of the circumstances
under which they were made, not misleading, and agrees to reimburse each such
indemnified party, as incurred, for any legal or other expenses reasonably
incurred by it in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, however, that the Company will
not be liable in any such case to the extent that any such loss, claim, damage
or liability arises out of or is based upon any such untrue statement or
alleged untrue statement or omission or alleged omission made therein in
reliance upon and in conformity with written information furnished to the
Company by or on behalf of any party claiming indemnification specifically for
inclusion therein. Notwithstanding the foregoing, any indemnification with
respect to any Registration Statement or Prospectus shall not inure to the
benefit of any Initial Purchaser (or any such controlling person), Holder or
Restricted Broker-Dealer from whom the person asserting any such loss, claim,
damage or liability purchased the Exchange Bonds, to the extent that any such
loss, claim, damage or liability occurs under the circumstances where (w) the
Company has previously furnished copies of such Registration Statement or
Prospectus (in each case, excluding the documents incorporated by reference
therein) to such Initial Purchaser, Holder or Restricted Broker-Dealer, (x) the
untrue statement or omission of a material fact contained in such Registration
Statement or Prospectus (in each case, excluding the documents incorporated by
reference therein) was corrected in an amendment or supplement to such
Registration Statement or Prospectus, (y) delivery of such Registration
Statement or Prospectus was required by the Act to be made to such Person, and
(z) there was sent or given to such Initial Purchaser, Holder or Registered
Broker-Dealer, at or prior to the written confirmation of the sale of the
Exchange Bonds to such Person, a copy of such Registration Statement or
Prospectus (in each case, excluding the documents incorporated by reference
therein), as amended or supplemented. This indemnity agreement shall be in
addition to any liability that the Company may otherwise have.
The Company also agrees to indemnify as provided in this Section 8(a)
or contribute as provided in Section 8(d) hereof to the Losses (defined below)
of each underwriter, if any (or any person who may be deemed to be an
underwriter under the Act), of Restricted Bonds or Exchange Bonds, as the case
my be, registered under a Shelf Registration Statement, their directors,
officers, employees, affiliates or agents and each person who controls such
underwriter within the meaning of either the Act or the Exchange Act on
substantially the same basis as that of the indemnification of the Initial
Purchasers and the selling Holders provided in this Section 8(a) and shall, if
requested by any Holder, enter into an underwriting agreement reflecting such
agreement, as provided in Section 6(c)(x) hereof.
(b) Each Holder of Bonds covered by a Registration Statement,
including each Initial Purchaser that is a Holder, in such capacity, severally,
and not jointly, agrees to indemnify and hold harmless the Company, each of its
directors, each of its officers who signs such Registration Statement and each
person who controls the Company within the meaning of either the Act or the
Exchange Act, to the same extent as the foregoing indemnity from the Company to
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 will be in addition to any liability that any Holder may
otherwise have.
(c) Promptly after receipt by an indemnified party under this
Section 8 of notice of the commencement of any action, such indemnified party
will, if a claim in respect thereof is to be made against the indemnifying
party under this Section, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying party (i)
will not relieve it from liability under paragraph (a) or (b) above unless and
to the extent it did not otherwise learn of such action and such failure
results in the forfeiture by the indemnifying party of substantial rights and
defenses and (ii) will not, in any event, relieve the indemnifying party from
any obligations to any indemnified party other than the indemnification
obligation provided in paragraph (a) or (b) above. The indemnifying party shall
be entitled to appoint counsel (including local counsel) of the indemnifying
party's choice at the indemnifying party's expense to represent the indemnified
party in any action for which indemnification is sought (in which case the
indemnifying party shall not thereafter be responsible for the fees and
expenses of any separate counsel, other than local counsel if not appointed by
the indemnifying party, retained by the indemnified party or parties except as
set forth below); provided, however, that such counsel shall be reasonably
satisfactory to the indemnified party. Notwithstanding the indemnifying party's
election to appoint counsel (including local counsel) to represent the
indemnified party in an action, the indemnified party shall have the right to
employ separate counsel (including local counsel), and the indemnifying party
shall bear the reasonable fees, costs and expenses of such separate counsel if
(i) the use of counsel chosen by the indemnifying party to represent the
indemnified party would present such counsel with a conflict of interest; (ii)
the actual or potential defendants in, or targets of, any such action include
both the indemnified party and the indemnifying party and the indemnified party
shall have reasonably concluded that there may be legal defenses available to
it and/or other indemnified parties that are in conflict with or additional to
those available to the indemnifying party; (iii) the indemnifying party shall
not have employed counsel reasonably satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice of the
institution of such action; or (iv) the indemnifying party shall authorize the
indemnified party to employ separate counsel at the expense of the indemnifying
party. An indemnifying party will not, without the prior written consent of the
indemnified parties, settle, compromise or consent to the entry of any judgment
with respect to any pending or threatened claim, action, suit or proceeding in
respect of which indemnification or contribution may be sought hereunder
(whether or not the indemnified parties are actual or potential parties to such
claim or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability arising out
of such claim, action, suit or proceeding. An indemnifying party shall not be
liable for any settlement of any proceeding effected without its prior written
consent which consent shall not be unreasonably withheld, delayed or
conditioned.
(d) In the event that the indemnity provided in paragraph (a) or
(b) of this Section 8 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, then each applicable indemnifying party shall
have a joint and several obligation to contribute to the aggregate losses,
claims, damages and liabilities (including legal or other expenses reasonably
incurred in connection with investigating or defending any loss, claim, damage,
liability or action) (collectively, the "Losses") to which such indemnified
party may be subject in such proportion as is appropriate to reflect the
relative benefits received by such indemnifying party on the one hand, and such
indemnified party, on the other hand, from the initial sale of Restricted Bonds
and the Registration Statement which resulted in such Losses; provided,
however, that in no case shall any Initial Purchaser be responsible, in the
aggregate, for any amount in excess of the purchase discount or commission
applicable to such Restricted Bond, as set forth in the Offering Memorandum,
nor shall any underwriter be responsible for any amount in excess of the
underwriting discount or commission applicable to the Bonds purchased by such
underwriter under the Registration Statement which resulted in such Losses. If
the allocation provided by the immediately preceding sentence is unavailable
for any reason, the indemnifying party and the indemnified party severally
shall contribute in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of such indemnifying party, on
the one hand, and such indemnified party, on the other hand, in connection with
the statements or omissions which resulted in such Losses, as well as any other
relevant equitable considerations. Benefits received by the Company shall be
deemed to be equal to the total net proceeds from the initial sale of
Restricted Bonds (before deducting expenses) received by it as set forth in the
Offering Memorandum. Benefits received by the Initial Purchaser shall be deemed
to be equal to the total purchase discounts and commissions as set forth on the
cover page of the Offering Memorandum, and benefits received by any other
Holders shall be equal to the value of receiving Restricted Bonds or Exchange
Bonds, as applicable, registered under the Act. Benefits received by any
underwriter shall be deemed to be equal to the total underwriting discounts and
commissions, as set forth on the cover page of the Prospectus forming a part of
the Registration Statement which resulted in such Losses. Relative fault shall
be determined by reference to, among other things, whether any untrue or
alleged untrue statement of a material fact or the omission or alleged omission
to state a material fact relates to information provided by the indemnifying
party, on the one hand, or by the indemnified party, on the other hand, the
intent of the parties and their relative knowledge, access to information and
opportunity to correct or prevent such untrue statement or omission. The
parties agree that it would not be just and equitable if contribution were
determined by pro rata allocation (even if the Holders were treated as one
entity for such purpose) or any other method of allocation that does not take
account of the equitable considerations referred to above. Notwithstanding the
provisions of this paragraph (d), no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section, each person who controls a
Holder within the meaning of either the Act or the Exchange Act and each
director, officer, employee, affiliate (as defined in Rule 144 under the Act)
and agent of such Holder shall have the same rights to contribution as such
Holder, and each person who controls the Company within the meaning of either
the Act or the Exchange Act, each officer of the Company who shall have signed
the Registration Statement and each director of the Company, shall have the
same rights to contribution as the Company, subject in each case to the
applicable terms and conditions of this paragraph (d).
The provisions of this Section will 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 indemnified persons referred to in this Section 8, and
will survive the sale by the Holder of securities covered by a Registration
Statement.
SECTION 9. RULE 144A
The Company hereby agrees with each Holder, for so long as any
Transfer Restricted Securities remain outstanding and during any period in
which the Company is not subject to Section 13 or 15(d) of the Exchange Act, to
make available, upon request of any Holder of Transfer Restricted Securities,
to any 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 Act in order to permit
resales of such Transfer Restricted Securities pursuant to Rule 144A.
SECTION 10. UNDERWRITTEN REGISTRATIONS
No Holder may participate in any Underwritten Registration hereunder
unless such Holder (a) agrees to sell such Holder's Transfer Restricted
Securities on the basis provided in customary underwriting arrangements entered
into in connection therewith and (b) completes and executes all reasonable
questionnaires, powers of attorney, and other documents required under the
terms of such underwriting arrangements.
SECTION 11. SELECTION OF UNDERWRITERS
For any Underwritten Offering, the investment banker or investment
bankers and manager or managers for any Underwritten Offering that will
administer such offering will be selected by the Holders of a majority in
aggregate principal amount of the Transfer Restricted Securities included in
such offering; provided, that such investment bankers and managers must be
reasonably satisfactory to the Company. The Holders of Transfer Restricted
Securities included in any such Underwritten Offering shall be responsible for
paying all underwriting or placement fees charged, or costs or expenses
incurred, by such investment bankers and managers in connection with such
Underwritten Offering. Such investment bankers and managers are referred to
herein as the "underwriters".
SECTION 12. MISCELLANEOUS
(a) Remedies. Each Holder, in addition to being entitled to
exercise all rights provided herein, in the Indenture, in the Purchase
Agreement or granted by law, including recovery of liquidated or other damages,
will be entitled to specific performance of its rights under this Agreement.
The Company agrees that monetary damages would not be adequate compensation for
any loss incurred by reason of a breach by the Company of the provisions of
this Agreement and hereby agrees to waive the defense in any action for
specific performance that a remedy at law would be adequate.
(b) No Inconsistent Agreements. The Company will not, on or after
the date of this Agreement, 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. The Company has
not previously entered into any agreement granting any registration rights with
respect to the Transfer Restricted Securities to any Person. The rights granted
to the Holders hereunder do not in any way conflict with and are not
inconsistent with the rights granted to the holders of the Company's securities
under any agreement in effect on the date hereof.
(c) Adjustments Affecting the Bonds. The Company will not take any
action, or voluntarily permit any change to occur, with respect to the Bonds
that would materially and adversely affect the ability of the Holders to
Consummate any Exchange Offer.
(d) Amendments and Waivers. The provisions of 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 (i) in the case
of Section 5 hereof and this Section 12(d)(i), the Company has obtained the
written consent of Holders of all outstanding Transfer Restricted Securities
and (ii) in the case of all other provisions hereof, the Company has obtained
the written consent of Holders of a majority of the outstanding principal
amount of Transfer Restricted Securities. Notwithstanding the foregoing, a
waiver or consent to or departure from the provisions hereof that relates
exclusively to the rights of Holders whose securities are being tendered
pursuant to the Exchange Offer and that does not affect directly or indirectly
the rights of other Holders whose securities are not being tendered pursuant to
such Exchange Offer may be given by the Holders of a majority of the
outstanding principal amount of Transfer Restricted Securities subject to such
Exchange Offer.
(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), telecopier, or air courier
guaranteeing overnight delivery:
(i) if to a Holder, at the address set forth on the
records of the Trustee under the Indenture, with a copy to the
Trustee; and
(ii) if to the Company:
The Potomac Edison Company
000 Xxxxx Xxxx Xxxxx
Xxxxxxxxxx, Xxxxxxxxxxxx 00000
Telecopier No.: 000-000-0000, Attention: Treasurer
With a copy at the same address to:
General Counsel
Telecopier No.: 000-000-0000
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
receipt acknowledged, if telecopied; and on the next Business Day, if timely
delivered to an air courier guaranteeing overnight delivery.
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address specified in the Indenture.
(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 of Transfer Restricted Securities; provided,
however, that this Agreement shall not inure to the benefit of or be binding
upon a successor or assign of a Holder unless and to the extent such successor
or assign acquired Transfer Restricted Securities directly from such Holder.
(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) Headings. The headings in this Agreement are for convenience
of reference only and shall not limit or otherwise affect the meaning hereof.
(i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO THE CONFLICT OF LAW RULES THEREOF.
(j) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be affected or impaired
thereby.
(k) 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 with respect to the
Transfer Restricted Securities. This Agreement supersedes all prior agreements
and understandings between the parties with respect to such subject matter.
(l) S-3 Ineligibility. If the Company is not eligible to use Act
Form S-3 by the 120th day after the date on which it determines that it is not
required to file the Exchange Offer Registration Statement pursuant to Section
4(a)(i) hereof or the 120th day after the date on which it receives the notice
specified in Section 4(a)(ii) hereof (either, the "S-3 Ineligibility Date"),
the Company shall (A) cause to be filed as soon as practicable after the S-3
Ineligibility Date a registration statement containing a resale prospectus on
whatever Act form the Company is then eligible to use relating to all Transfer
Restricted Securities the Holders of which shall have provided the information
required pursuant to Section 4(b) hereof and (B) use its best efforts to cause
such shelf registration statement to become effective as soon as practicable.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
THE POTOMAC EDISON COMPANY
By: /s/ Xxxxxxx X. Xxxxx
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Name: Xxxxxxx X. Xxxxx
Title: Treasurer
CONFIRMED AND ACCEPTED
as of the date first above written:
CREDIT SUISSE FIRST BOSTON LLC,
By: /s/ Xxxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx
Title: Director
As representative of the Initial Purchasers
s
EXHIBIT A
PLAN OF DISTRIBUTION
Each broker-dealer that receives new notes for its own account under
the exchange offer must acknowledge that it will deliver a prospectus in
connection with any resale of those notes. This prospectus, as it may be
amended or supplemented from time to time, may be used by a broker-dealer for
resales of new notes received in exchange for original notes that had been
acquired as a result of market-making or other trading activities. We have
agreed that, for a period of 180 days after the expiration date of the exchange
offer, we will make this prospectus, as it may be amended or supplemented,
available to any broker-dealer for use in connection with any such resale. Any
broker-dealers required to use this prospectus and any amendments or
supplements to this prospectus for resales of the new notes must notify us of
this fact by checking the box on the letter of transmittal requesting
additional copies of these documents.
Notwithstanding the foregoing, we are entitled under the registration
rights agreement to suspend the use of this prospectus by broker-dealers under
specified circumstances.
If we suspend the use of this prospectus, the 180-day period referred
to above will be extended by a number of days equal to the period of the
suspension.
We will not receive any proceeds from any sale of new notes by
broker-dealers. New notes received by broker-dealers for their own account
under the exchange offer may be sold from time to time in one or more
transactions in the over-the-counter market, in negotiated transactions,
through the writing of options on those notes or a combination of those
methods, at market prices prevailing at the time of resale, at prices related
to prevailing market prices or at negotiated prices. Any resales may be made
directly to purchasers or to or through brokers or dealers who may receive
compensation in the form of commissions or concessions from the selling
broker-dealer or the purchasers of the new notes. Any broker-dealer that
resells new notes received by it for its own account under the exchange offer
and any broker or dealer that participates in a distribution of the new notes
may be deemed to be an "underwriter" within the meaning of the Act and any
profit on any resale of new notes and any commissions or concessions received
by these persons may be deemed to be underwriting compensation under the Act.
The letter of transmittal states that, by acknowledging that it will deliver
and by delivering a prospectus, a broker-dealer will not be deemed to admit
that it is an "underwriter" within the meaning of the Act.(1)
We have agreed to pay all expenses incidental to the exchange offer
other than commissions and concessions of any broker or dealer and will
indemnify holders of the new notes, including any broker-dealers, against
certain liabilities, including liabilities under the Act or contribute to
payments that they may be required to make in request thereof.
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(1) This sentence will be revised if all notes are held in book-entry format
through the systems of The Depository Trust Company and such systems do not
require use of a letter of transmittal.
