EXECUTION COPY
REGISTRATION RIGHTS AGREEMENT
October 31, 1997
SOCIETE GENERALE SECURITIES CORPORATION
BT ALEX. XXXXX INCORPORATED
XXXXXXXXX & COMPANY, INC.
c/o Societe Generale Securities Corporation
1221 Avenue of the Americas
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
STELLEX INDUSTRIES, INC., a Delaware corporation (the "Company"),
proposes to issue and sell to you (the "Initial Purchasers"), upon the terms set
forth in a purchase agreement dated October 23, 1997 (the "Purchase Agreement"),
$100,000,000 principal amount of its 9 1/2% Senior Subordinated Notes due 2007
(the "Securities"). Payment of principal and interest on the Securities will be
unconditionally guaranteed, jointly and severally, on a senior subordinated
basis by the Guarantors. Capitalized terms used but not specifically defined
herein have the respective meanings ascribed thereto in the Purchase Agreement.
As an inducement to the Initial Purchasers to enter into the Purchase Agreement
and in satisfaction of a condition to your obligations thereunder, the Company
agrees with you, for the benefit of the holders (including the Initial
Purchasers) of the Securities (collectively, the "Holders"), as follows:
1. Registered Exchange Offer. The Company shall prepare and, not later
than 45 days following the Issue Date (as hereinafter defined), the Company and
the Guarantors (i) shall file with the Commission a registration statement (the
"Exchange Offer Registration Statement") on an appropriate form under the
Securities Act with respect to a proposed offer (the "Registered Exchange
Offer") to the Holders to issue and deliver to such Holders, in exchange for the
Securities, a like aggregate principal amount of senior subordinated notes of
the Company (the "Exchange Securities") substantially identical to the
Securities, except for the transfer restrictions relating to the Securities,
(ii) shall use their reasonable best efforts to cause the Exchange Offer
Registration Statement to become effective under the Securities Act no later
than 120 days after the Issue Date and to be consummated no later than 165 days
after the Issue Date and (iii) shall keep the Registered Exchange Offer open for
a period of not less than 20 business days (or longer, if required by applicable
law) (such period being called the "Exchange Offer Registration Period"). The
Exchange Securities will be issued under the Indenture or an indenture (the
"Exchange Securities Indenture") between the Company, the Guarantors and the
Trustee or such other bank or trust company reasonably satisfactory to you, as
trustee (the "Exchange Securities Trustee"), such indenture to be substantially
identical to the Indenture except for the transfer restrictions relating to the
Securities (as described above).
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Upon the effectiveness of the Exchange Offer Registration Statement,
the Company shall promptly commence the Registered Exchange Offer, it being the
objective of such Registered Exchange Offer to enable each Holder electing to
exchange Securities for Exchange Securities (assuming that such Holder (a) is
not (i) an affiliate of the Company within the meaning of the Securities Act or
(ii) an Exchanging Dealer (as defined below) not complying with the requirements
of the next sentence, (b) acquires the Exchange Securities in the ordinary
course of such Holder's business and (c) has no arrangements or understandings
with any person to participate in the distribution of the Exchange Securities)
to trade such Exchange Securities from and after their receipt without any
limitations or restrictions under the Securities Act and without material
restrictions under the securities laws of the several states of the United
States. The Company, the Initial Purchasers and each Exchanging Dealer (as
defined below) acknowledge that, pursuant to current interpretations by the
Commission's staff of Section 5 of the Securities Act, each Holder which is a
broker-dealer electing to exchange Securities, acquired for its own account as a
result of market making activities or other trading activities, for Exchange
Securities (an "Exchanging Dealer"), is required to deliver a prospectus
containing the information set forth in Annex A hereto on the cover, in Annex B
hereto in the "Exchange Offer Procedures" section and the "Purpose of the
Exchange Offer" section, and in Annex C hereto in the "Plan of Distribution"
section of such prospectus in connection with a sale of any such Exchange
Securities received by such Exchanging Dealer pursuant to the Registered
Exchange Offer.
In connection with the Registered Exchange Offer, the Company shall:
(a) mail to each Holder a copy of the prospectus forming part of the
Exchange Offer Registration Statement, together with an appropriate letter
of transmittal and related documents;
(b) keep the Registered Exchange offer open for not less than 20
business days (or longer if required by applicable law);
(c) utilize the services of an Exchange Agent for the Registered
Exchange Offer with an address in the Borough of Manhattan, The City of New
York;
(d) permit Holders to withdraw tendered Securities at any time prior to
the close of business, New York time, on the last business day on which the
Registered Exchange Offer shall remain open; and
(e) otherwise comply in all respects with all laws applicable to the
Registered Exchange Offer.
Promptly after the close of the Registered Exchange Offer, the Company
shall:
(a) accept for exchange all Securities tendered and not validly
withdrawn pursuant to the Registered Exchange Offer;
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(b) deliver to the Trustee for cancellation all Securities so accepted
for exchange; and
(c) cause the Trustee or the Exchange Securities Trustee, as the case
may be, promptly to authenticate and deliver to each Holder of Securities,
Exchange Securities equal in principal amount to the Securities of such
Holder so accepted for exchange.
The Company and the Guarantors shall use their reasonable best efforts
to keep the Exchange Offer Registration Statement effective and to amend and
supplement the prospectus contained therein in order to permit such prospectus
to be used by all persons subject to the prospectus delivery requirements of the
Securities Act for such period of time as such persons must comply with such
requirements in order to resell the Exchange Securities; provided that (i) in
the case where such prospectus and any amendment or supplement thereto must be
delivered by an Exchanging Dealer, such period shall be the lesser of 90 days
and the date on which all Exchanging Dealers have sold all Exchange Securities
held by them and (ii) the Company shall make such prospectus and any amendment
or supplement thereto available to any broker-dealer for use in connection with
any resale of any Exchange Securities for a period of not less than 90 days
after the consummation of the Registered Exchange Offer.
The Indenture or the Exchange Securities Indenture, as the case may be,
shall provide that the Securities and the Exchange Securities shall vote and
consent together on all matters as one class and that none of the Securities or
the Exchange Securities will have the right to vote or consent as a separate
class on any matter.
Interest on each Exchange Security issued pursuant to the Registered
Exchange Offer will accrue from the last interest payment date on which interest
was paid on the Securities surrendered in exchange therefor or, if no interest
has been paid on the Securities, from the date of original issue of the
Securities.
Each Holder participating in the Registered Exchange Offer shall be
required to represent to the Company and the Guarantors that at the time of the
consummation of the Registered Exchange Offer (i) any Exchange Securities
received by such Holder will be acquired in the ordinary course of business,
(ii) such Holder 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 Securities or the Exchange Securities within the meaning of the
Securities Act, (iii) such Holder is not an affiliate of the Company within the
meaning of the Securities Act, or if it is an affiliate, it will comply with the
registration and prospectus delivery requirements of the Securities Act to the
extent applicable and (iv) such Holder is not acting on behalf of any person who
could not make the foregoing representations. Such Holder shall also make such
other representations as may be required to comply with applicable law or
Commission policy with respect to the Registered Exchange Offer.
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Notwithstanding any other provisions hereof, the Company will ensure
that (i) any Exchange Offer Registration Statement and any amendment thereto and
any prospectus forming part thereof and any supplement thereto complies in all
material respects with the Securities Act and the rules and regulations
thereunder, (ii) any Exchange Offer Registration Statement and any amendment
thereto does not, when it becomes effective, 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 (iii) any prospectus
forming part of any Exchange Offer Registration Statement, and any supplement to
such prospectus, does not include, as of the consummation of the Registered
Exchange Offer, an untrue statement of a material fact or omit 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.
2. Shelf Registration. If (i) because of any change in law or
applicable interpretations thereof by the Commission the Company is not
permitted to effect the Registered Exchange Offer as contemplated by Section 1
hereof, or (ii) any Holder (A) notifies the Company on or prior to the
consummation of the Registered Exchange Offer that is not eligible to
participate in the Registered Exchange Offer, (B) participates in the Registered
Exchange Offer and does not receive freely transferable Exchange Securities in
exchange for tendered Securities or (C) is a broker-dealer that holds Securities
acquired directly from the Company or one of its affiliates, then the following
provisions shall apply:
(a) (x) The Company and the Guarantors shall use their reasonable best
efforts to cause to be filed with the Commission a Shelf Registration Statement
pursuant to Rule 415 under the Securities Act, which may be an amendment to the
Exchange Offer Registration Statement (a "Shelf Registration Statement," and
together with any Exchange Offer Registration Statement a "Registration
Statement"), on or prior to the earliest to occur of (1) the 30th day after the
Company determines that it is not permitted to effect the Registered Exchange
Offer or (2) the 30th day after the date on which the Company receives notice
from a Holder of Transfer Restricted Securities as contemplated by clause (ii)
above (such earliest date being the "Shelf Filing Deadline") which Shelf
Registration Statement shall provide for resales of Transfer Restricted
Securities; and
(y) The Company and the Guarantors shall use their reasonable best
efforts to cause such Shelf Registration Statement to be declared effective by
the Commission on or prior to the 60th day after the Shelf Filing Deadline.
Notwithstanding the foregoing, the Company shall not be required to file a Shelf
Registration Statement with respect to Securities or Exchange Securities of any
Holder (other than Securities of the Initial Purchasers) on account of such
Holder not being able to make the representations contained in Section 1 in
connection with the Registered Exchange Offer.
(b) The Company and the Guarantors shall use their reasonable best
efforts to keep the Shelf Registration Statement continuously effective in order
to permit the prospectus forming part thereof to be usable by Holders for a
period of two years from the Issue Date or such shorter period that will
terminate when all the Securities and Exchange Securities covered by the Shelf
Registration Statement have been sold pursuant to the Shelf
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Registration Statement (in any such case, such period being called the "Shelf
Registration Period"). The Company and the Guarantors shall not be deemed to
have breached its obligations pursuant to the preceding sentence if it shall be
required to amend the Shelf Registration Statement or the effectiveness of the
Shelf Registration Statement shall be suspended, or the prospectus contained in
the Shelf Registration Statement shall not be usable, as a result of a corporate
transaction involving the Company that is not adequately reflected in the Shelf
Registration Statement; provided that the failure to keep the Shelf Registration
Statement effective and usable for such reasons shall last no longer than 45
days in any 12-month period (whereafter Liquidated Damages pursuant to Section 3
shall accrue). Any such period during which the Company and the Guarantors fail
to keep the Shelf Registration Statement effective and usable is referred to as
a "Suspension Period." A Suspension Period shall commence on and include the
date that the Company gives notice that the Shelf Registration Statement is no
longer effective or the prospectus included therein is no longer usable and
shall end on the earlier to occur of (i) the date when each seller of Transfer
Restricted Securities covered by such Shelf Registration Statement either
receives copies of the supplemented or amended prospectus or is advised in
writing by the Company that the use of the prospectus may be resumed and (ii)
the expiration of the 30 days in any 12-month period during which one or more
Suspension Periods has been in effect; provided that the period during which the
Shelf Registration Statement is required to be kept continuously effective shall
be increased by the total number of days of all such Suspension Periods.
(c) Notwithstanding any other provisions hereof, the Company and the
Guarantors will ensure that (i) any Shelf Registration Statement and any
amendment thereto and any prospectus forming part thereof and any supplement
thereto complies in all material respects with the Securities Act and the rules
and regulations thereunder, (ii) any Shelf Registration Statement and any
amendment thereto (in either case, other than with respect to information
included therein in reliance upon or in conformity with written information
furnished to the Company by or on behalf of any Holder specifically for use
therein (the "Holders' Information")) does not, when it becomes effective,
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 (iii) any prospectus forming part of any Shelf Registration
Statement, and any supplement to such prospectus (in either case, other than
with respect to Holders' Information), does not include an untrue statement of a
material fact or omit 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.
3. Liquidated Damages. (a) The parties hereto agree that the Holders of
Securities will suffer damages if the Company and the Guarantors fail to fulfill
their obligations under Section 1 or Section 2, as applicable, and that it would
not be feasible to ascertain the extent of such damages. Accordingly, if (i) the
applicable Registration Statement is not filed with the Commission on or prior
to the date specified for such filing in this Agreement, (ii) the Exchange Offer
Registration Statement or the Shelf Registration Statement, as the case may be,
is not declared effective on or prior to the date specified for such
effectiveness in this Agreement, (iii) the Registered Exchange Offer is not
consummated
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on or prior to 165 days after the Issue Date, or (iv) the Shelf Registration
Statement is filed and declared effective on or prior to the date specified for
such effectiveness in this Agreement but shall thereafter cease to be effective
(at any time that the Company is obligated to maintain the effectiveness
thereof) without being succeeded within 45 days by an amendment to the
Registration Statement or an additional Shelf Registration Statement filed and
declared effective (each such event referred to in clauses (i) through (iv), a
"Registration Default"), the Company will generally be obligated to pay
liquidated damages ("Liquidated Damages") to each Holder of Transfer Restricted
Securities (as defined below), with respect to the first 90-day period
immediately following the occurrence of such Registration Default, in an amount
equal to $0.05 per week per $1,000 principal amount of the Securities
constituting Transfer Restricted Securities held by such Holder for each week or
portion thereof that the Registration Default continues. The amount of the
Liquidated Damages will increase by an additional $.05 per week per $1,000
principal amount of Securities constituting Transfer Restricted Securities with
respect to each subsequent 90-day period until all Registration Defaults have
been cured, up to a maximum amount of Liquidated Damages of $.20 per week per
$1,000 principal amount of Transfer Restricted Securities. Following the cure of
all Registration Defaults, the accrual of Liquidated Damages will cease.
"Transfer Restricted Securities" means each Security until the earliest to occur
of (i) the date on which such Security has been exchanged for a freely
transferrable Exchange Security in the Registered Exchange Offer, (ii) the date
on which such Security has been effectively registered under the Securities Act
and disposed of in accordance with the Shelf Registration Statement or (iii) the
date on which such Security is distributed to the public pursuant to Rule 144
under the Securities Act (or any successor provision) or is salable pursuant to
Rule 144(k) (or any successor provision) under the Securities Act.
Notwithstanding anything to the contrary in this Section 3(a), the Company shall
not be required to pay Liquidated Damages to the Holder of Transfer Restricted
Securities if such Holder: (a) failed to comply with its obligations to make the
representations in the second to last paragraph of Section 1; or (b) failed to
provide the information required to be provided by it, if any, pursuant to
Section 4(m).
(b) The Company shall notify the Trustee and the Paying Agent under the
Indenture promptly upon the happening of each and every Registration Default.
The Company shall pay the Liquidated Damages due on the Transfer Restricted
Securities by depositing with the Paying Agent (which may not be the Company for
these purposes), in trust, for the benefit of the Holders thereof, prior to
10:00 a.m., New York City time on the next interest payment date specified by
the Indenture and the Securities, sums sufficient to pay the Liquidated Damages
then due. The Liquidated Damages due shall be payable on each interest payment
date specified by the Indenture to the record holder entitled to receive the
interest payment to be made on such date. Each obligation to pay Liquidated
Damages shall be deemed to accrue from and including the applicable Registration
Default.
(c) The parties hereto agree that the Liquidated Damages provided for
in this Section 3 constitute a reasonable estimate of and are intended to
constitute the sole damages that will be suffered by Holders of Transfer
Restricted Securities by reason of the failure of (i) the Shelf Registration
Statement or the Exchange Offer Registration Statement,
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as the case may be, to be filed, (ii) the Exchange Offer Registration Statement
to be declared effective and the Registered Exchange Offer to be consummated,
(iii) the Shelf Registration Statement to be declared effective or (iv) the
Shelf Registration Statement to again become effective, in each case to the
extent required by this Agreement.
4. Registration Procedures. In connection with any Registration
Statement, the following provisions shall apply:
(a) The Company shall (i) use its reasonable best efforts to furnish to
Societe Generale Securities Corporation ("SGSC") and its counsel, prior to the
filing thereof with the Commission, a copy of the Registration Statement and
each amendment thereof and each supplement, if any, to the prospectus included
therein and shall use reasonable best efforts to consult with SGSC regarding
such comments as SGSC or its counsel reasonably may propose; and (ii) include
the information (or information substantially to the same effect) set forth in
Annex A hereto on the cover, in Annex B hereto in the "Exchange Offer
Procedures" section and the "Purpose of the Exchange Offer" section and in Annex
C hereto in the "Plan of Distribution" section of the prospectus forming a part
of the Exchange Offer Registration Statement, and include the information (or
information substantially to the same effect) set forth in Annex D hereto in the
Letter of Transmittal delivered pursuant to the Registered Exchange Offer (in
each case, to the extent such information is required by applicable law or the
Commission's rules and/or interpretations);
(b) The Company shall advise you, each Exchanging Dealer and the
Holders (if applicable) and, if requested by such person, confirm such advice in
writing (which advice pursuant to clauses (iii)-(iv) hereof shall be accompanied
by an instruction to suspend the use of the prospectus until the requisite
changes have been made):
(i) when any Registration Statement and any amendment thereto has been
filed with the Commission and when such Registration Statement or any
post-effective amendment thereto has become effective;
(ii) prior to the effectiveness of any Registration Statement, of the
receipt of any comment letter or request for information from the
Commission;
(iii) following the effectiveness of any Registration Statement, of any
request by the Commission for amendments or supplements to such Registration
Statement or the prospectus included therein or for additional information;
(iv) of the issuance by the Commission of any stop order suspending the
effectiveness of any Registration Statement or the initiation of any
proceeding for that purpose;
(v) following the effectiveness of any Registration Statement, of the
receipt by the Company of any notification with respect to the suspension of
the qualification
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of the Securities or the Exchange Securities for sale in any jurisdiction or
the initiation or threatening of any proceeding for such purpose; and
(vi) of the happening of any event that requires the making of any
changes in any Registration Statement or the prospectus so that, as of such
date, the statements therein are not misleading in any material respect and
do not omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in any material
respect.
The Company will make every reasonable effort to obtain the withdrawal
at the earliest possible time of any order suspending the effectiveness of any
Registration Statement.
(c) The Company will furnish to each Holder of Transfer Restricted
Securities specifically named in any Shelf Registration Statement, without
charge, at least one copy of such Shelf Registration Statement and any
post-effective amendment thereto, including financial statements and schedules,
and, if the Holder so requests in writing, all exhibits (including those
incorporated by reference).
(d) The Company will, during the Shelf Registration Period, promptly
deliver to each Holder of Transfer Restricted Securities specifically named in
any Shelf Registration Statement, without charge, as many copies of the
prospectus (including each preliminary prospectus) included in such Shelf
Registration Statement and any amendment or supplement thereto as such Holder
may reasonably request; and the Company consents to the use of the prospectus or
any amendment or supplement thereto by each of the selling Holders of Transfer
Restricted Securities in connection with the offering and sale of the Transfer
Restricted Securities covered by the prospectus or any amendment or supplement
thereto.
(e) The Company will furnish to each Exchanging Dealer and each Initial
Purchaser and to any other Holder who so requests, without charge, at least one
copy of the Exchange Offer Registration Statement and any post-effective
amendment thereto, including financial statements and schedules, and, if the
Exchanging Dealer, Initial Purchaser or any such Holder so requests in writing,
all exhibits (including those incorporated by reference).
(f) The Company will, during the Exchange Offer Registration Period,
promptly deliver to each Exchanging Dealer or the Initial Purchasers, as
applicable, without charge, as many copies of the prospectus included within the
coverage of Exchange Offer Registration Statement and any amendment or
supplement thereto as such Exchanging Dealer or the Initial Purchasers, as
applicable, may reasonably request for delivery by such Exchanging Dealer in
connection with a sale of Exchange Securities received by it pursuant to the
Registered Exchange Offer; and the Company consents to the use of the prospectus
or any amendment or supplement thereto by any such Exchanging Dealer as
aforesaid.
(g) To the extent required by applicable law, prior to any public
offering of Securities or Exchange Securities pursuant to any Registration
Statement, the Company will
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use its reasonable best efforts to register or qualify or cooperate with the
Holders of Securities included therein and its counsel in connection with the
registration or qualification of such securities for offer and sale under the
state securities or blue sky laws of such United States jurisdictions as any
such Holder reasonably requests in writing and do any and all other acts or
things necessary or advisable to enable the offer and sale in such jurisdictions
of the Securities or Exchange Securities covered by such Registration Statement;
provided, however, that neither the Company nor any Guarantor shall be required
to qualify as a foreign corporation where it is not now so qualified or to take
any action that would subject it to service of process in suits or to taxation
in any jurisdiction where it is not now so subject.
(h) The Company will cooperate with the Holders of Securities or
Exchange Securities to facilitate the timely preparation and delivery of
certificates representing Securities or Exchange Securities to be sold pursuant
to any Registration Statement free of any restrictive legends and in such
denominations and registered in such names as Holders may request in writing
prior to sales of Securities or Exchange Securities pursuant to such
Registration Statement.
(i) If any event contemplated by paragraphs (b)(iii) through (v) above
occurs during the period in which the Company is required to maintain an
effective Registration Statement, the Company will use its reasonable best
efforts to promptly prepare a post-effective amendment to the Registration
Statement or a supplement to the related prospectus or file any other required
document so that, as thereafter delivered to purchasers of the Securities or
purchasers of Exchange Securities from a Holder, the prospectus will not include
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.
(j) Not later than the effective date of the applicable Registration
Statement, the Company will provide a CUSIP number for the Exchange Securities
and provide the applicable trustee with certificates for the Securities or
Exchange Securities, as the case may be, in a form eligible for deposit with The
Depository Trust Company; and upon consummation of the Registered Exchange
Offer, the Company shall deliver to the Trustee, on behalf of the Holders of the
Exchange Securities, a legal opinion to the effect that the Exchange Securities,
when issued, will constitute valid and legally binding obligations of the
Company, entitled to the benefits of the Indenture, and enforceable against the
Company in accordance with their terms (subject to customary qualifications for
opinions of this type).
(k) The Company and the Guarantors will comply with all applicable
rules and regulations of the Commission and will make generally available to the
Company's security holders as soon as practicable after the effective date of
the applicable Registration Statement an earnings statement satisfying the
provisions of Section 11(a) of the Securities Act; provided that in no event
shall such earnings statement be delivered later than 45 days after the end of a
12-month period (or 90 days, if such period is a fiscal year) beginning with
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the first month of the Company's first fiscal quarter commencing after the
effective date of the applicable Registration Statement, which statements shall
cover such 12-month period.
(l) The Company will cause the Indenture or the Exchange Securities
Indenture, as the case may be, to be qualified under the Trust Indenture Act as
required by applicable law in a timely manner.
(m) The Company may require each Holder of Transfer Restricted
Securities to be sold pursuant to any Shelf Registration Statement to furnish to
the Company such information regarding the Holder and the distribution of such
Transfer Restricted Securities as the Company may from time to time reasonably
require for inclusion in such Registration Statement, and the Company may
exclude from such registration the Transfer Restricted Securities of any Holder
that unreasonably fails to furnish such information within a reasonable time
after receiving such request.
(n) In the case of a Shelf Registration Statement, each Holder of
Transfer Restricted Securities to be registered pursuant thereto agrees by
acquisition of such Transfer Restricted Securities that, upon receipt of any
notice from the Company pursuant to Section 4(b)(iii) through (v) hereof, such
Holder will discontinue disposition of such Transfer Restricted Securities until
such Holder's receipt of copies of the supplemental or amended prospectus
contemplated by Section 4(i) hereof, or until advised in writing (the "Advice")
by the Company that the use of the applicable prospectus may be resumed. If the
Company shall give any notice under Section 4(b)(iii) through (v) during the
period that the Company is required to maintain an effective Registration
Statement (the "Effectiveness Period"), such Effectiveness Period shall be
extended by the number of days during such period from and including the date of
the giving of such notice to and including the date when each seller of Transfer
Restricted Securities covered by such Registration Statement shall have received
(x) the copies of the supplemental or amended prospectus contemplated by Section
4(i) (if an amended or supplemental prospectus is required) or (y) the Advice
(if no amended or supplemental prospectus is required).
(o) In the case of a Shelf Registration Statement, the Company shall
enter into such customary agreements (including, if requested, an underwriting
agreement in customary form) and take all such other action, if any, as Holders
of a majority in aggregate principal amount of the Securities and Exchange
Securities being sold or the managing underwriters (if any) shall reasonably
request in order to facilitate any disposition of Securities or Exchange
Securities pursuant to such Shelf Registration Statement; provided, however,
that the Company shall not be obligated to enter into an underwriting agreement
or to facilitate such disposition in an underwritten offering pursuant to any
Shelf Registration Statement unless Holders of a majority in aggregate principal
amount of such Transfer Restricted Securities elect to dispose of such Transfer
Restated Securities in such an underwritten offering.
(p) In the case of a Shelf Registration Statement, the Company shall
(i) make reasonably available for inspection by a representative of, and Special
Counsel (as
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defined below) acting for, Holders of a majority in aggregate principal amount
of the Securities and Exchange Securities being sold and any managing
underwriter participating in any disposition of Securities or Exchange
Securities pursuant to such Shelf Registration Statement, all relevant financial
and other records, pertinent corporate documents and properties of the Company
and its subsidiaries and (ii) use its reasonable best efforts to have its
officers, directors, employees, accountants and counsel supply all relevant
information reasonably requested by such representative, Special Counsel or any
such managing underwriter (an "Inspector") in connection with such Shelf
Registration Statement; provided, however, that the Company need not make
available or supply any information pursuant to this paragraph (p) to the extent
such information may not be disclosed pursuant to any confidentiality agreement
to which the Company or any of its Subsidiaries is a party or such disclosure
would jeopardize any applicable attorney-client, work product or other
privilege.
(q) In the case of a Shelf Registration Statement, the Company shall,
if requested by Holders of a majority in aggregate principal amount of the
Securities and Exchange Securities being sold, their Special Counsel or the
managing underwriters (if any) in connection with such Shelf Registration
Statement, use its reasonable best efforts to cause (i) its counsel to deliver
an opinion relating to the Shelf Registration Statement and the Securities or
Exchange Securities, as applicable, in customary form, (ii) its officers to
execute and deliver all customary documents and certificates reasonably
requested by Holders of a majority in aggregate principal amount of the
Securities and Exchange Securities being sold, their Special Counsel or the
managing underwriters (if any) and (iii) its independent public accountants to
provide a comfort letter in customary form, subject to receipt of appropriate
documentation as contemplated, and only if permitted, by Statement of Auditing
Standards No. 72.
5. Registration Expenses. The Company and the Guarantors will bear all
expenses incurred in connection with the performance of their obligations under
Sections 1, 2, 3 and 4 hereof and the Company and the Guarantors will reimburse
the Initial Purchasers and the Holders for the reasonable fees and disbursements
(up to an aggregate amount of $50,000) of one firm of attorneys chosen by the
Holders of a majority in aggregate principal amount of the Securities and the
Exchange Securities to be sold pursuant to a Shelf Registration Statement (the
"Special Counsel") acting for the Initial Purchasers or Holders in connection
therewith. The Company and the Guarantors shall not have any obligation to pay
any underwriting fees, discounts or commissions attributable to the sale of any
Securities or Exchange Securities pursuant to this Agreement.
6. Indemnification. (a) Indemnification of Holders. The Company and
each Guarantor, jointly and severally, shall indemnify and hold harmless each
Holder (including, without limitation, any such Initial Purchaser or Exchanging
Dealer), their respective directors, officers, representatives and agents and
each person, if any, who controls such Holder within the meaning of Section 15
of the Securities Act (collectively referred to for the purposes of this Section
6 as a Holder) against any loss, claim, damage or liability, joint or several,
or any action in respect thereof (including, without limitation, any loss,
claim, damage, liability or action relating to purchases and sales of Securities
or
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Exchange Securities), to which that Holder may become subject, under the
Securities Act or otherwise, insofar as 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 any such Registration Statement or any
preliminary or final prospectus forming part thereof or in any amendment or
supplement thereto or (ii) the omission or alleged omission to state in any such
Registration Statement or any preliminary or final prospectus forming part
thereof or in any amendment or supplement thereto a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
shall reimburse each Holder for any legal or other expenses reasonably incurred
by that Holder in connection with investigating or preparing to defend or
defending against or appearing as a third party witness in connection with any
such loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that the foregoing indemnification agreement with respect to
any preliminary prospectus shall not inure to the benefit of any Holder from
whom the person asserting any such loss, claim, damage or liability purchased
Securities or Exchange Securities, if (i) a copy of the preliminary prospectus
(as then amended or supplemented) was delivered to such person at or prior to
the written confirmation of the sale of Securities or Exchange Securities to
such person, (ii) a copy of the final prospectus (as then amended or
supplemented) was not sent or given to such person by or on behalf of such
Holder and (iii) the final prospectus (as so amended or supplemented) would have
cured the defect giving rise to such loss, claim, damage or liability; and
further provided, however, that the Company and the Guarantors shall not be
liable in any such case to the extent that any such loss, claim, damage,
liability or action arises out of or is based upon an untrue statement or
alleged untrue statement in or omission or alleged omission from any preliminary
prospectus or Registration Statement or any such amendment or supplement in
reliance upon and in conformity with any Holders' Information.
(b) Indemnification of Company, Guarantors, Directors and Officers.
Each Holder, severally and not jointly, agrees to indemnify and hold harmless
the Company and each Guarantor, their respective directors, officers,
representatives and agents, and each person, if any, who controls them or any of
them within the meaning of Section 15 of the Securities Act (collectively
referred to for the purposes of this Section 6 as the Company), against any
loss, claim, damage or liability, joint or several, or any action in respect
thereof, to which they or any of them may become subject, under the Securities
Act or otherwise, insofar as 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 preliminary or final prospectus or
such Registration Statement or in any amendment or supplement thereto or (ii)
the omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, but
in each case only to the extent that the untrue statement or alleged untrue
statement or omission or alleged omission was made in reliance upon and in
conformity with any Holders' Information furnished to the Company by or on
behalf of that Holder specifically for use therein, and shall reimburse the
indemnified party for any legal or other expenses reasonably incurred by the
indemnified party in connection with investigating or preparing to defend or
defending against or appearing as third party witness in connection with any
such loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that no such Holder
13
shall be liable for any indemnity claims hereunder in excess of the amount of
net proceeds received by such Holder from the sale of Securities or Exchange
Securities pursuant to such Shelf Registration Statement.
(c) Actions; Notification. 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 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; provided, however, that any indemnified party shall
have the right to employ separate counsel in any such action and to participate
in the defense thereof but the fees and expenses of such counsel shall be at the
expense of such indemnified party unless (i) the employment thereof has been
specifically authorized by the indemnifying party in writing, (ii) such
indemnified party shall have been advised by such counsel that there may be one
or more legal defenses available to it which are different from or additional to
those available to the indemnifying party and in the reasonable judgment of such
counsel it is advisable for such indemnified party to employ separate counsel or
(ii) the indemnifying party has failed to assume the defense of such action and
employ counsel reasonably satisfactory to the indemnified party, in which case,
if such indemnified party notifies the indemnifying party in writing that it
elects to employ separate counsel at the expense of the indemnifying party, the
indemnifying party shall not have the right to assume the defense of such action
on behalf of such indemnified party, it being understood, however, that the
indemnifying party shall not, in connection with any one such action or separate
but substantially similar or related actions in the same jurisdiction arising
out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys at any
time for all such indemnified parties, which firm shall be designated in writing
by the Holders of a majority in aggregate principal amount of the Securities or
Exchange Securities, as the case may be, if the indemnified parties under this
Section 6 consist of any Holder or any of their respective officers, employees
or controlling persons, or by the Company, if the indemnified parties under this
Section 6 consist of the Company or a Guarantor or any of their respective
directors, officers, employees or controlling persons. Each indemnified party,
as a condition of the indemnity agreements contained in Sections 6(a) and 6(b),
shall use all reasonable efforts to cooperate with the indemnifying party in the
defense of any such action or claim. Subject to the provisions of
14
Section 6(d) below, no indemnifying party shall be liable for any settlement of
any such action effected without its written consent (which consent shall not be
unreasonably withheld), but if settled with its written consent or if there be a
final judgment for the plaintiff in any such action, the indemnifying party
agrees to indemnify and hold harmless any indemnified party from and against any
loss or liability by reason of such settlement or judgment.
(d) Settlement without Consent if Failure to Reimburse. If at any time
an indemnified party shall have requested that an indemnifying party reimburse
the indemnified party for fees and expenses of counsel payable in accordance
with this Section 6, such indemnifying party agrees that it shall be liable for
any settlement of the nature contemplated by this Section 6 effected without its
written consent if (i) such settlement is entered into more than 45 days after
receipt by such indemnifying party of the request for reimbursement, (ii) such
indemnifying party shall have received notice of the terms of such settlement at
least 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement.
(e) Contribution. If the indemnification provided for in this Section 6
is unavailable or insufficient to hold harmless an indemnified party under
Section 6(a) or (b), then 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 shall be appropriate to
reflect the relative benefits received by the Company and the Guarantors on the
one hand and a Holder with respect to the sale by such Holder of Securities or
Exchange Securities on the other or (ii) if the allocation provided by clause
(i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Company and the Guarantors on the one
hand and such Holder on the other with respect to the statements or omissions
which 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 and the Guarantors on the one hand and a Holder
on the other with respect to such offering shall be deemed to be in the same
proportion as the total net proceeds from the offering of the Securities or
Exchange Securities (before deducting expenses) received by the Company and the
Guarantors as set forth on the cover of the Offering Memorandum bear to the
total proceeds received by such Holder with respect to its sale of Securities or
Exchange Securities. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company and the Guarantors on the one hand or to any
Holders' Information supplied by such Holder on the other, the intent of the
parties and their relative knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. The Company and the
Holders agree that it would not be just and equitable if contributions pursuant
to this Section 6(e) were to be determined by pro rata allocation (even if the
Holders were treated as one entity for such purpose) or by any other method of
allocation which does not take into
15
account the equitable considerations referred to herein. 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(e)
shall be deemed to include, for purposes of this Section 6(e), any legal or
other expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 6(e), no Holder shall be required to contribute any
amount in excess of the amount by which the total price at which the Securities
or Exchange Securities sold by such Holder to any purchaser exceeds the amount
of any damages which such Holder has otherwise paid or become liable 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.
Any Holder's obligations to contribute as provided in this Section 6(e)
are several and not joint.
The obligations of the Company, the Guarantors and the Holders in this
Section 6 are in addition to any other liability which the Company, the
Guarantors or the Holders as the case may be, may otherwise have.
7. Rule 144A. Unless the Company is then subject to Section 13 or 15(d)
of the Exchange Act, the Company hereby agrees with each Holder, for so long as
any Transfer Restricted Securities remain outstanding, to make available, upon
request, 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 from 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. Notwithstanding the
foregoing, nothing in this Section 7 shall be deemed to require the Company to
register any of its securities pursuant to the Exchange Act.
8. Underwritten Registrations. If any of the Transfer Restricted
Securities covered by any Shelf Registration Statement are to be sold in an
underwritten offering, the investment banker or investment bankers and manager
or managers that will administer the offering will be selected by the Holders of
a majority in aggregate principal amount of such Transfer Restricted Securities
included in such offering, subject to the consent of the Company (which shall
not be unreasonably withheld or delayed), and such Holders shall be responsible
for all underwriting commissions and discounts in connection therewith.
9. Miscellaneous. (a) Amendments and Waivers. The provisions of this
Agreement may not be amended, modified or supplemented, and waivers or consents
to departures from the provisions hereof may not be given, unless the Company
has obtained the written consent of Holders of a majority in aggregate principal
amount of the Securities and the Exchange Securities, taken as a single class.
Notwithstanding the foregoing, a waiver or consent to depart from the provisions
hereof with respect to a matter that relates exclusively to the rights of the
Holders of Securities or Exchange Securities whose Securities
16
or Exchange Securities are being sold or exchanged pursuant to a Registration
Statement and that does not directly or indirectly affect the rights of other
Holders may be given by Holders of a majority in aggregate principal amount of
the Securities or Exchange Securities being sold or exchanged by such Holders
pursuant to such Registration Statement.
(b) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail,
telecopier, or air courier guaranteeing overnight delivery:
(1) if to a Holder, at the most current address given by such Holder to
the Company in accordance with the provisions of this Section 9(b), which
address initially is, with respect to each Holder, the address of such
Holder maintained by the Registrar under the Indenture, with a copy in like
manner to Societe Generale Securities Corporation;
(2) if to you, initially at your address set forth in the Purchase
Agreement; and
(3) if to the Company or the Guarantors, initially at the address of
the Company set forth in the Purchase Agreement, or with a copy to Winston &
Xxxxxx, 000 Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Xxxxxx X.
Xxxxxxx.
All such notices and communications shall be deemed to have been duly
given: when delivered by hand, if personally delivered; one business day after
being delivered to a next-day air courier; five business days after being
deposited in the mail; and when receipt is acknowledged by the recipient's
telecopier machine, if telecopied.
(c) Successors and Assigns. This Agreement shall be binding upon the
successors and assigns of each of the parties; 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 from such Holder.
(d) Counterparts. This Agreement may be executed in any number of
counterparts (which may be delivered in original form or by telecopies) 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.
(e) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(f) Governing Law; Submission to Jurisdiction.
THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED AND INTERPRETED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
17
(g) No Inconsistent Agreements. The Company has not and shall not, on
or after the date of this Agreement, enter into any agreement that is
inconsistent with the rights granted to the holders of Transfer Restricted
Securities in this Agreement or otherwise conflicts with the provisions hereof.
The Company has not previously entered into any agreement which remains in
effect granting any registration rights with respect to any of its debt
securities to any person, which agreement would allow any person other than the
Holders of Transfer Restricted Securities to require the Company to register any
such debt securities pursuant to a Registration Statement. Without limiting the
generality of the foregoing, without the written consent of the holders of a
majority in aggregate principal amount of the then outstanding Transfer
Restricted Securities, the Company shall not grant to any person the right to
request the Company to register any debt securities of the Company under the
Securities Act pursuant to a Registration Statement unless the rights so granted
are not in conflict or inconsistent with the provisions of the Agreement.
(h) No Piggyback on Registrations. Neither the Company, nor any of its
security holders (other than the holders of Transfer Restricted Securities in
such capacity) shall have the right to include any securities of the Company in
any Shelf Registration or Registered Exchange Offer other than Transfer
Restricted Securities.
(i) Severability. The remedies provided herein are cumulative and not
exclusive of any remedies provided by law. If any term, provision, covenant or
restriction of this Agreement is held by a court of competent jurisdiction to be
invalid, illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their reasonable efforts to find and employ an alternative
means to achieve the same or substantially the same result as that contemplated
by such term, provision, covenant or restriction.
(j) Remedies. In the event of a breach by the Company or any Guarantor,
or by any holder of Transfer Restricted Securities, of any of their obligations
under this Agreement, each holder of Transfer Restricted Securities or the
Company and the Guarantors, as the case may be, in addition to being entitled to
exercise all rights granted by law, including recovery of damages (other than
the recovery of damages for a breach by the Company of its obligations under
Sections 1 or 2 hereof for which Liquidated Damages have been paid pursuant to
Section 3 hereof), will be entitled to specific performance of its rights under
this Agreement. Except as provided in Section 3, the Company, the Guarantors and
each holder of Transfer Restricted Securities agree that monetary damages would
not be adequate compensation for any loss incurred by reason of a breach by it
of any of the provisions of this Agreement and hereby further agree that, in the
event of any action for specific performance in respect of such breach, it shall
waive the defense that a remedy at law would be adequate.
18
Please confirm that the foregoing correctly sets forth the agreement
among the Company and you.
Very truly yours,
STELLEX INDUSTRIES, INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice Chairman
KII HOLDING CORP.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice Chairman
KII ACQUISITION CORP.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice Chairman
STELLEX AEROSPACE
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice Chairman
XXXXX MACHINING INTERNATIONAL
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice Chairman
19
PARAGON PRECISION PRODUCTS
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice Chairman
SCANNING ELECTION ANALYSIS
LABORATORIES, INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice Chairman
GENERAL INSPECTION LABORATORIES, INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice Chairman
TSMD ACQUISITION CORP.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
STELLEX MICROWAVE SYSTEMS, INC.
By: /s/ Xxxxxxx X. Xxxxxx
------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice Chairman
20
Accepted in New York, New York
SOCIETE GENERALE SECURITIES CORPORATION
By: /s/ Xxxxxxxx X. Xxxxx
-----------------------------------
Name: Xxxxxxxx X. Xxxxx
Title: Managing Director
BT ALEX. XXXXX INCORPORATED
By: /s/ Xxxxx Xxxxxxx
-----------------------------------
Name: Xxxxx Xxxxxxx
Title: Vice President
XXXXXXXXX & COMPANY, INC.
By: /s/ Xxxxxx Xxxxxxxxx
-----------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Executive Vice President
ANNEX A
Each broker-dealer that receives Exchange Securities for its own
account pursuant to the Registered Exchange Offer must acknowledge that it will
deliver a prospectus in connection with any resale of such Exchange Securities.
The Letter of Transmittal states that by so acknowledging and by delivering a
prospectus, a broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act. This Prospectus, as it
may be amended or supplemented from time to time, may be used by a broker-dealer
in connection with resales of Exchange Securities received in exchange for
Securities where such Securities were acquired by such broker-dealer as a result
of market-making activities or other trading activities. The Company has agreed
that, for a period of 90 days after the Expiration Date (as defined herein), it
will make this Prospectus available to any broker-dealer for use in connection
with any such resale. See "Plan of Distribution."
ANNEX B
Each broker-dealer that receives Exchange Securities for its own
account in exchange for Securities, where such Securities were acquired by such
broker-dealer as a result of market-making activities or other trading
activities, must acknowledge that it will deliver a prospectus in connection
with any resale of such Exchange Securities. See "Plan of Distribution."
ANNEX C
PLAN OF DISTRIBUTION
Each broker-dealer that receives Exchange Securities for its own
account pursuant to the Registered Exchange Offer must acknowledge that it will
deliver a prospectus in connection with any resale of such Exchange Securities.
This Prospectus, as it may be amended or supplemented from time to time, may be
used by a broker-dealer in connection with resales of Exchange Securities
received in exchange for Securities where such Securities were acquired as a
result of market-making activities or other trading activities. The Company has
agreed that, for a period of 90 days after the Expiration Date, it will make
this Prospectus, as amended or supplemented, available to any broker-dealer for
use in connection with any such resale. In addition, until _______________,
199_, all dealers effecting transactions in the Exchange Securities may be
required to deliver a prospectus.1/
The Company will not receive any proceeds from any sale of Exchange
Securities by broker-dealers. Exchange Securities received by broker-dealers for
their own account pursuant to the Registered 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 the Exchange
Securities or a combination of such methods of resale, at market prices
prevailing at the time of resale, at prices related to such prevailing market
prices or at negotiated prices. Any such resale 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 any such broker-dealer or the
purchasers of any such Exchange Securities. Any broker-dealer that resells
Exchange Securities that were received by it for its own account pursuant to the
Registered Exchange Offer and any broker or dealer that participates in a
distribution of such Exchange Securities may be deemed to be an "underwriter"
within the meaning of the Securities Act and any profit on any such resale of
Exchange Securities and any commission or concessions received by any such
persons may be deemed to be underwriting compensation under the Securities 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 Securities Act.
For a period of 90 days after the Expiration Date the Company will
promptly send additional copies of this Prospectus and any amendment or
supplement to this Prospectus to any broker-dealer that requests such documents
in the Letter of Transmittal. The Company has agreed to pay all expenses
incident to the Registered Exchange Offer other than commissions or concessions
of any broker-dealers and will indemnify the Holders of the Securities
(including any broker-dealers) against certain liabilities, including
liabilities under the Securities Act.
--------
1/ In addition, the legend required by Item 502(e) of Regulation S-K will
appear on the back cover page of the Exchange Offer prospectus.
ANNEX D
|_| CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10
ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY
AMENDMENTS OR SUPPLEMENTS THERETO.
Name: _______________________________________
Address: _______________________________________
_______________________________________
If the undersigned is not a broker-dealer, the undersigned represents that it is
not engaged in, and does not intend to engage in, a distribution of Exchange
Securities. If the undersigned is a broker-dealer that will receive Exchange
Securities for its own account in exchange for Securities that were acquired as
a result of market-making activities or other trading activities, it
acknowledges that it will deliver a prospectus in connection with any resale of
such Exchange Securities; however, by so acknowledging and by delivering a
prospectus, the undersigned will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.
