Medis Technologies Ltd. 5,000 Shares of 7.25% Series A Cumulative Convertible Perpetual Preferred Stock (Liquidation Preference $10,000 per share)* REGISTRATION RIGHTS AGREEMENT
EXHIBIT
4.4
5,000
Shares of 7.25% Series A Cumulative Convertible Perpetual Preferred
Stock
(Liquidation
Preference $10,000 per share)*
November
15, 2006
Citigroup
Global Markets Inc.
As
Representative of the Initial Purchasers
c/o
Citigroup Global Markets Inc.
000
Xxxxxxxxx Xxxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Ladies
and Gentlemen:
Medis
Technologies Ltd., a corporation organized under the laws of the State of
Delaware (the “Company”)
proposes to issue and sell to certain purchasers (the “Initial
Purchasers”),
for
whom you (the “Representative”)
are
acting as representative, 5,000 Shares of [__]% Series A Cumulative Convertible
Perpetual Preferred Stock (Liquidation Preference $10,000 per share) (the
“Preferred
Stock”),
of
the Company (the “Firm
Securities”).
The
Company also proposes to grant to the Initial Purchasers an option to purchase
up to 750 additional shares of Preferred Stock to cover over-allotments, if
any
(the “Option
Securities”
and,
together with the Firm Securities, the “Securities”),
upon
the terms set forth in the Purchase Agreement between the Company and the
Representative dated November 9, 2006 (the “Purchase
Agreement”)
relating to the initial placement (the “Initial
Placement”)
of the
Securities. To the extent there are no additional parties listed on Schedule
I
to the Purchase Agreement other than you, the term Representative as used herein
shall mean you as the Initial Purchaser and the term Representatives and Initial
Purchasers shall mean either the singular or plural as the context requires.
To
induce the Initial Purchasers to enter into the Purchase Agreement and to
satisfy a condition to your obligations thereunder, the Company agrees with
you
for your benefit and the benefit of the holders from time to time of the
Securities (including the Initial Purchasers) (each a “Holder”
and,
collectively, the “Holders”),
as
follows:
1.
Definitions.
Capitalized terms used herein without definition shall have their respective
meanings set forth in the Purchase Agreement. As used in this Agreement, the
following capitalized defined terms shall have the following
meanings:
“Act”
shall mean the Securities Act of 1933, as amended, and the rules and regulations
of the Commission promulgated thereunder.
“Affiliate”
shall have the meaning specified in Rule 405 under the Act and the terms
“controlling” and “controlled” shall have meanings correlative
thereto.
|
*
|
Plus
an option to purchase up to 750 shares of the Preferred Stock of
the
Company to cover
over-allotments.
|
“Broker-Dealer”
shall mean any broker or dealer registered as such under the Exchange
Act.
“Business
Day” shall mean any day other than a Saturday, a Sunday or a legal holiday or a
day on which banking institutions or trust companies are authorized or obligated
by law to close in New York City.
“Certificate
of Designation” shall mean the Certificate of Designation relating to the
Securities, dated as of November 15, 2006, signed by the Company and duly filed
with the Secretary of State of the State of Delaware.
“Closing
Date” shall mean the date of the first issuance of the Securities.
“Commission”
shall mean the Securities and Exchange Commission.
“Deferral
Period” shall have the meaning indicated in Section 3(i) hereof.
“Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended, and the rules
and regulations of the Commission promulgated thereunder.
“Final
Memorandum” shall mean the offering memorandum, dated November 9, 2006, relating
to the Securities, including any and all exhibits thereto and any information
incorporated by reference therein as of such date.
“Fundamental
Change” shall have the meaning set forth in the Certificate of
Designations.
“Holder”
shall have the meaning set forth in the preamble hereto.
“Initial
Placement” shall have the meaning set forth in the preamble hereto.
“Initial
Purchasers” shall have the meaning set forth in the preamble
hereto.
“Losses”
shall have the meaning set forth in Section 5(d) hereof.
“Majority
Holders” shall mean, on any date, Holders of a majority of the Registrable
Securities registered under a Registration Statement. For purposes of
determining the “Majority Holders,” each share of Preferred Stock that is a
Registrable Security shall initially be equivalent to 347.222 shares of common
stock. Such ratio shall be adjusted, from time to time, in accordance with
the
terms of the Securities.
“Managing
Underwriters” shall mean the investment banker or investment bankers and manager
or managers that administer an underwritten offering, if any, conducted pursuant
to Section 6 hereof.
“NASD
Rules” shall mean the Conduct Rules and the By-Laws of the National Association
of Securities Dealers, Inc.
“Notice
and Questionnaire” shall mean a written notice delivered to the Company
substantially in the form attached as the Annex to the Final
Memorandum.
“Notice
Holder” shall mean, on any date, any Holder of Registrable Securities that has
delivered a Notice and Questionnaire to the Company on or prior to such
date.
“Prospectus”
shall mean a prospectus included in the Shelf Registration Statement (including,
without limitation, a prospectus that discloses information previously omitted
from a prospectus filed as part of an effective registration statement in
reliance upon Rule 430A under the Act), as amended or supplemented by any
prospectus supplement, with respect to the terms of the offering of any portion
of the Registrable Securities covered by the Shelf Registration Statement,
and
all amendments and supplements thereto, including any and all exhibits thereto
and any information incorporated by reference therein.
“Purchase
Agreement” shall have the meaning set forth in the preamble hereto.
“Repurchase
Common Stock” shall mean the Common Stock issued upon the repurchase of the
Securities by the Company in connection with a Fundamental Change.
“Registrable
Securities” shall mean Securities, the Underlying Common Stock and the
Repurchase Common Stock until such securities have been converted or exchanged
and, at all times subsequent to any such conversion or exchange, any securities
into or for which such securities have been converted or exchanged, and any
security issued with respect thereto upon any stock dividend, split, merger
or
similar event until, in the case of any such security, the earliest of
(i) its effective registration under the Securities Act and resale in
accordance with the Registration Statement covering it, (ii) expiration of
the holding period that would be applicable thereto under Rule 144(k) were
it
not held by an Affiliate of the Company, or (iii) its sale to the public
pursuant to Rule 144.
“Registration
Default Damages” shall have the meaning set forth in Section 7
hereof.
“Securities”
shall have the meaning set forth in the preamble hereto.
“Shelf
Registration Period” shall have the meaning set forth in Section 2(c)
hereof.
“Shelf
Registration Statement” shall mean one or more “shelf” registration statements
of the Company pursuant to the provisions of Section 2 hereof which cover
some or all of the Registrable Securities on an appropriate form under
Rule 415 under the Act, or any similar rule that may be adopted by the
Commission, amendments and supplements to such registration statements,
including post-effective amendments, in each case including the Prospectus
contained therein, all exhibits thereto and all material incorporated by
reference therein.
“Underlying
Common Stock” means the Common Stock into which the Securities are convertible
or issued upon any such conversion.
“Underwriter”
shall mean any underwriter of Registrable Securities in connection with an
offering thereof under the Shelf Registration Statement.
2.
Shelf
Registration.
(a) The
Company shall as promptly as practicable (but in no event more than 90 days
after the Closing Date) file with the Commission a Shelf Registration Statement
providing for the registration of, and the sale on a continuous or delayed
basis
by the Holders of, all of the Registrable Securities, from time to time in
accordance with the methods of distribution elected by such Holders, pursuant
to
Rule 415 under the Act or any similar rule that may be adopted by the
Commission.
(b) The
Company shall use its best efforts to cause the Shelf Registration Statement
to
become or be declared effective under the Act no later than 180 days after
the
Closing Date.
(c) The
Company shall use its best efforts to keep the Shelf Registration Statement
continuously effective, supplemented and amended as required by the Act, in
order to permit the Prospectus forming part thereof to be usable by Holders
for
a period (the “Shelf
Registration Period”)
from
the date the Shelf Registration Statement is declared effective by the
Commission until the earlier of (i) the second anniversary thereof or (ii)
the
date upon which there are no Registrable Securities outstanding. The Company
shall be deemed not to have used its best efforts to keep the Shelf Registration
Statement effective during the Shelf Registration Period if it voluntarily
takes
any action that would result in Holders of Registrable Securities not being
able
to offer and sell such Registrable Securities at any time during the Shelf
Registration Period, unless such action is (x) required by applicable law
or otherwise undertaken by the Company in good faith and for valid business
reasons (not including avoidance of the Company’s obligations hereunder),
including the acquisition or divestiture of assets, and (y) permitted by Section
3(i) hereof.
(d) The
Company shall cause the Shelf Registration Statement and the related Prospectus
and any amendment or supplement thereto, as of the effective date of the Shelf
Registration Statement or such amendment or supplement, (i) to comply in all
material respects with the applicable requirements of the Act; and (ii) not
to
contain any untrue statement of a material fact or omit to state a material
fact
required to be stated therein or necessary in order to make the statements
therein (in the case of the Prospectus, in the light of the circumstances under
which they were made) not misleading.
(e) Each
Holder of Registrable Securities agrees to deliver a Notice and Questionnaire
to
the Company at least five Business Days prior to any distribution by it of
Registrable Securities under the Shelf Registration Statement; provided,
however,
that if
the Company is required to amend the shelf registration statement to include
any
Holder of Registrable Securities, as provided for below, such Holder will not
distribute its securities under the Shelf Registration Statement until such
amendment has become effective. From and after the date the Shelf Registration
Statement is declared effective, the Company shall, as promptly as is
practicable after the date a Notice and Questionnaire is delivered, and in
any
event within five Business Days after such date, (i) if required by applicable
law, file with the Commission a post-effective amendment to the Shelf
Registration Statement or prepare and, if required by applicable law, file
a
supplement to the related Prospectus or a amendment or supplement to any
document incorporated therein by reference or file any other required document
so that the Holder
delivering
such Notice and Questionnaire is named as a selling holder in the Shelf
Registration Statement and the related Prospectus and so that such Holder is
permitted to deliver such Prospectus to purchasers of the Registrable Securities
in accordance with applicable law and, if the Company shall file a
post-effective amendment to the Shelf Registration Statement, use best efforts
to cause such post-effective amendment to be declared effective under the Act
as
promptly as is practicable; provided,
however,
that
once the Shelf Registration Statement has been declared effective, and until
such time as the Company is eligible to file a shelf registration statement
on
Form S-3 under the Act, the Company will not be required to amend the shelf
registration statement to include any Holder of Registrable Securities more
than
once every 60 days; (ii) provide such Holder copies of any documents filed
pursuant to Section 2(e)(i) hereof; and (iii) notify such Holder as promptly
as
practicable after the effectiveness under the Act of any post-effective
amendment filed pursuant to Section 2(e)(i) hereof; provided, that if such
Notice and Questionnaire is delivered during a Deferral Period, the Company
shall so inform the Holder delivering such Notice and Questionnaire and shall
take the actions set forth in clauses (i), (ii) and (iii) above upon expiration
of the Deferral Period in accordance with Section 3(i) hereof. Notwithstanding
anything contained herein to the contrary, the Company shall be under no
obligation to name any Holder that is not a Notice Holder as a selling holder
in
the Shelf Registration Statement or related Prospectus; provided,
however,
that
any Holder that becomes a Notice Holder pursuant to the provisions of this
Section 2(e) (whether or not such Holder was a Notice Holder at the time the
Shelf Registration Statement was declared effective) shall be named as a selling
holder in the Shelf Registration Statement or related Prospectus in accordance
with the requirements of this Section 2(e).
(f) Notwithstanding
anything contained in Section 2(e) to the contrary, each Holder of Registrable
Securities agrees that once the Shelf Registration Statement has been declared
effective, and until such time as the Company is eligible to file a shelf
registration statement on Form S-3 under the Act, such Holder will not
distribute its securities under the Shelf Registration Statement until the
distribution of securities is registered and acknowledges that the Company
will
not be required to amend the shelf registration statement to include any Holder
of Registrable Securities more than once every 60 days.
(g) If
not
eligible as of the date of this Agreement, within five Business Days of becoming
eligible, the Company shall give written notice to the Representative, each
of
the Initial Purchasers and each Holder, in the manner provided for in Section
10, of its eligibility to file a shelf registration statement on Form S-3 under
the Act.
3.
Registration
Procedures.
The
following provisions shall apply in connection with the Shelf Registration
Statement.
(a) The
Company shall:
(i) use
its
best efforts to furnish to the Representative and its counsel, and to counsel
for the Notice Holders if so requested by such Notice Holders, within a
reasonable time prior to the filing thereof with the Commission, a copy of
the
Shelf Registration Statement and each amendment thereof and each amendment
or
supplement, if any, to the Prospectus included therein (including all documents
incorporated by reference therein after the initial filing) and shall
use
its
best efforts to reflect in each such document, when so filed with the
Commission, such comments as the Representative reasonably proposes;
and
(ii) include
information regarding the Notice Holders and the methods of distribution they
have elected for their Registrable Securities provided to the Company in Notices
and Questionnaires as necessary to permit such distribution by the methods
specified therein.
(b) The
Company shall ensure that:
(i) the
Shelf
Registration Statement and any amendment thereto and any Prospectus forming
part
thereof and any amendment or supplement thereto complies in all material
respects with the Act; and
(ii) the
Shelf
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.
(c) The
Company shall advise the Representative, the Notice Holders and any underwriter
that has provided in writing to the Company a telephone or facsimile number
and
address for notices, and confirm such advice by notice in writing (which notice
pursuant to clauses (ii)-(v) hereof shall be accompanied by an instruction
to
suspend the use of the Prospectus until the Company shall have remedied the
basis for such suspension):
(i) when
the
Shelf Registration Statement and any amendment thereto has been filed with
the
Commission and when the Shelf Registration Statement or any post-effective
amendment thereto has become effective;
(ii) of
any
request by the Commission for any amendment or supplement to the Shelf
Registration Statement or the Prospectus or for additional
information;
(iii) of
the
issuance by the Commission of any stop order suspending the effectiveness of
the
Shelf Registration Statement or the institution or threatening of any proceeding
for that purpose;
(iv) of
the
receipt by the Company of any notification with respect to the suspension of
the
qualification of the Registrable Securities included therein for sale in any
jurisdiction or the institution or threatening of any proceeding for such
purpose; and
(v) of
the
happening of any event that requires any change in the Shelf Registration
Statement or the Prospectus so that, as of such date, they (A) do not contain
any untrue statement of a material fact and (B) do not omit to state a material
fact required to be stated therein or necessary to make the statements therein
(in the case of the Prospectus, in the light of the circumstances under which
they were made) not misleading.
(d) The
Company shall use its best efforts to prevent the issuance of any order
suspending the effectiveness of the Shelf Registration Statement or the
qualification of the securities therein for sale in any jurisdiction and, if
issued, to obtain as soon as possible the withdrawal thereof.
(e) The
Company shall furnish to each Notice Holder, without charge, at least one copy
of the Shelf Registration Statement and any post-effective amendment thereto,
including all material incorporated therein by reference, and, if a Notice
Holder so requests in writing, all exhibits thereto (including exhibits
incorporated by reference therein).
(f) During
the Shelf Registration Period, the Company shall promptly deliver to each
Initial Purchaser, each Notice Holder, and any sales or placement agents or
underwriters acting on their behalf, without charge, as many copies of the
Prospectus (including any preliminary Prospectus) included in the Shelf
Registration Statement and any amendment or supplement thereto as any such
person may reasonably request. The Company consents to the use of the Prospectus
or any amendment or supplement thereto by each of the foregoing in connection
with the offering and sale of the Registrable Securities.
(g) Prior
to
any offering of Registrable Securities pursuant to the Shelf Registration
Statement, the Company shall arrange for the qualification of the Registrable
Securities for sale under the laws of such jurisdictions as any Notice Holder
shall reasonably request and shall maintain such qualification in effect so
long
as required; provided,
that in
no event shall the Company be obligated to qualify to do business in any
jurisdiction where it is not then so qualified or to take any action that would
subject it to service of process in suits, other than those jurisdictions
arising out of the Initial Placement or any offering pursuant to the Shelf
Registration Statement, in any jurisdiction where it is not then so
subject.
(h) Upon
the
occurrence of any event contemplated by subsections (c)(ii) through (v)
above, the Company shall promptly (or within the time period provided for by
Section 3(i) hereof, if applicable) prepare a post-effective amendment to the
Shelf Registration Statement or an amendment or supplement to the related
Prospectus or file any other required document so that, as thereafter delivered
to Initial Purchasers of the securities included therein, the Prospectus will
not include an untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein,
in the light of the circumstances under which they were made, not misleading.
(i) Upon
the
occurrence or existence of any pending corporate development or any other
material event (including without limit, the filing of an annual report on
Form
10-K under the Securities Act) that, in the reasonable judgment of the Company,
makes it appropriate to suspend the availability of the Shelf Registration
Statement and the related Prospectus, the Company shall give notice (without
notice of the nature or details of such events) to the Notice Holders that
the
availability of the Shelf Registration is suspended and, upon actual receipt
of
any such notice, each Notice Holder agrees not to sell any Registrable
Securities pursuant to the Shelf Registration until such Notice Holder’s receipt
of copies of the supplemented or amended Prospectus provided for in Section
3(i)
hereof, or until it is advised in writing by the Company that the Prospectus
may
be used, and has received copies of any additional or supplemental filings
that
are incorporated or deemed incorporated by reference in such Prospectus. The
period
during
which the availability of the Shelf Registration and any Prospectus is suspended
(the “Deferral
Period”)
shall
not exceed 45 days in any three-month period or 90 days in any twelve-month
period.
(j) Not
later
than the effective date of the Shelf Registration Statement, the Company shall
provide a CUSIP number for the Registrable Securities registered under the
Shelf
Registration Statement and provide printed certificates for such Registrable
Securities, free of any restrictive legends, in a form eligible for deposit
with
The Depository Trust Company.
(k) The
Company shall comply with all applicable rules and regulations of the Commission
and shall make generally available to its security holders an earnings statement
satisfying the provisions of Section 11(a) of the Act as soon as
practicable after the effective date of the Shelf Registration Statement and
in
any event no later than 45 days after the end of a 12-month period (or 90 days,
if such period is a fiscal year) beginning with the first month of the Company’s
first fiscal quarter commencing after the effective date of the Shelf
Registration Statement.
(l) The
Company may require each Holder of Registrable Securities to be sold pursuant
to
the Shelf Registration Statement to furnish to the Company such information
regarding the Holder and the distribution of such Registrable Securities as
the
Company may from time to time reasonably require for inclusion in the Shelf
Registration Statement. The Company may exclude from the Shelf Registration
Statement the Registrable Securities of any Holder that unreasonably fails
to
furnish such information within a reasonable time after receiving such
request.
(m) The
Company shall enter into customary agreements, if requested (including an
underwriting agreement in customary form) and take all other appropriate actions
in order to expedite or facilitate the registration or the disposition of the
Registrable Securities, and in connection therewith, if an underwriting
agreement is entered into, cause the same to contain indemnification provisions
and procedures no less favorable than those set forth in Section 5
hereof.
(n) The
Company shall:
(i) make
reasonably available for inspection by the Holders of Registrable Securities
to
be registered thereunder, any underwriter participating in any disposition
pursuant to the Shelf Registration Statement, and any attorney, accountant
or
other agent retained by the Holders or any such underwriter all relevant
financial and other records and pertinent corporate documents of the Company
and
its subsidiaries;
(ii) cause
the
Company’s officers, directors, employees, accountants and auditors to supply all
relevant information reasonably requested by the Holders or any such
underwriter, attorney, accountant or agent in connection with any the Shelf
Registration Statement as is customary for similar due diligence
examinations;
(iii) upon
request, make such representations and warranties to the Holders of Registrable
Securities registered thereunder and the underwriters, if any, in form,
substance and scope as are customarily made by issuers to underwriters in
primary underwritten offerings and covering matters including, but not limited
to, those set forth in the Purchase Agreement;
(iv) obtain
opinions of counsel to the Company and updates thereof (which counsel and
opinions (in form, scope and substance) shall be reasonably satisfactory to
the
Managing Underwriters, if any) addressed to each selling Holder and the
underwriters, if any, covering such matters as are customarily covered in
opinions requested in underwritten offerings and such other matters as may
be
reasonably requested by such Holders and underwriters;
(v) upon
request, obtain “comfort” letters and updates thereof from the independent
certified public accountants of the Company (and, if necessary, any other
independent certified public accountants of any subsidiary of the Company or
of
any business acquired by the Company for which financial statements and
financial data are, or are required to be, included in the Shelf Registration
Statement), addressed to each selling Holder of Registrable Securities
registered thereunder and the underwriters, if any, in customary form and
covering matters of the type customarily covered in “comfort” letters in
connection with primary underwritten offerings; and
(vi) deliver
such documents and certificates as may be reasonably requested by the Majority
Holders or the Managing Underwriters, if any, including those to evidence
compliance with Section 3(i) hereof and with any customary conditions contained
in the underwriting agreement or other agreement entered into by the Company.
(vii) The
actions set forth in clauses (iii), (iv), (v) and (vi) of this paragraph (n)
shall be performed at (A) the effectiveness of the Shelf Registration Statement
and each post-effective amendment thereto; and (B) each closing under any
underwriting or similar agreement as and to the extent required
thereunder.
(o) In
the
event that any Broker-Dealer shall underwrite any Registrable Securities or
participate as a member of an underwriting syndicate or selling group or “assist
in the distribution” (within the meaning of the NASD Rules) thereof, whether as
a Holder of such Registrable Securities or as an underwriter, a placement or
sales agent or a broker or dealer in respect thereof, or otherwise, the Company
shall assist such Broker-Dealer in complying with the NASD Rules.
(p) The
Company shall use its best efforts to take all other steps necessary to effect
the registration of the Registrable Securities covered by the Shelf Registration
Statement.
4.
Registration
Expenses.
The
Company shall bear all expenses incurred in connection with the performance
of
its obligations under Sections 2 and 3 hereof and shall reimburse the
Holders for the reasonable fees and disbursements of one firm or counsel which
shall
initially be King & Spalding, LLP, but which may be another nationally
recognized law firm experienced in securities matters designated by the Majority
Holders to act as counsel for the Holders in connection therewith, consented
to
by the Company, such consent not to be unreasonably withheld or delayed.
5.
Indemnification
and Contribution.
(a) The Company agrees to indemnify and hold harmless each Holder of
Registrable Securities covered by the Shelf Registration Statement, each Initial
Purchaser, the directors, officers, employees, Affiliates and agents of each
such Holder or Initial Purchaser and each person who controls any such Holder
or
Initial Purchaser 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 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 Shelf Registration Statement
as
originally filed or in any amendment thereof, or in any preliminary Prospectus
or the 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 the party claiming indemnification specifically
for inclusion therein. 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 5(a) or contribute
as provided in Section 5(d) hereof to Losses of each underwriter, if any, of
Registrable Securities registered under the Shelf Registration Statement, its
directors, officers, employees, Affiliates or agents and each person who
controls such underwriter on substantially the same basis as that of the
indemnification of the Initial Purchasers and the selling Holders provided
in
this paragraph (a) and shall, if requested by any Holder, enter into an
underwriting agreement reflecting such agreement, as provided in
Section 3(n) hereof.
(b) Each
Holder of securities covered by the Shelf 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 the Shelf 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 each such
Holder, but only with reference to written information relating to such Holder
furnished to the Company by or on behalf of such Holder specifically for
inclusion in the documents referred to in the foregoing indemnity. This
indemnity agreement shall be acknowledged by each Notice Holder that is not
an
Initial Purchaser in such Notice Holder’s
Notice
and Questionnaire and shall be in addition to any liability that any such Notice
Holder may otherwise have.
(c) Promptly
after receipt by an indemnified party under this Section 5 or 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 5,
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 different from 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 or 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.
(d) In
the
event that the indemnity provided in paragraph (a) or (b) of this Section 5
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 loss, claim, liability, damage or action)
(collectively “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 Placement and the Shelf 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 Registrable
Security, as set forth in the Final Memorandum, nor shall any underwriter be
responsible for any amount in excess of the underwriting discount or commission
applicable to the securities purchased by such underwriter under the Shelf
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 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 Placement (before deducting expenses) as set forth
in
the Final Memorandum. Benefits received by the Initial Purchasers shall be
deemed to be equal to the total purchase discounts and commissions as set forth
on the cover page of the Final Memorandum, and benefits received by any other
Holders shall be deemed to be equal to the value of receiving Registrable
Securities 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 Shelf
Registration Statement which resulted in such Losses. Relative fault shall
be
determined by reference to, among other things, whether any untrue or any
alleged untrue statement of a material fact or 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 which 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 5, each person who controls a Holder within the meaning of
either the Act or the Exchange Act and each director, officer, employee 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 Shelf
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).
(e) The
provisions of this Section 5 shall remain in full force and effect, regardless
of any investigation made by or on behalf of any Holder or the Company or any
of
the indemnified persons referred to in this Section 5, and shall survive the
sale by a Holder of securities covered by the Shelf Registration
Statement.
6.
Underwritten
Registrations.
(a) If any of the Registrable Securities covered by the Shelf Registration
Statement are to be sold in an underwritten offering, the Managing Underwriters
shall be selected by the Majority Holders.
(b) No
person
may participate in any underwritten offering pursuant to the Shelf Registration
Statement unless such person (i) agrees to sell such person’s Registrable
Securities
on the basis reasonably provided in any underwriting arrangements approved
by
the persons entitled hereunder to approve such arrangements; and (ii) completes
and executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents reasonably required under the terms of such
underwriting arrangements.
7. Registration
Defaults. If any of the following events shall occur, then the Company shall
pay liquidated damages (the “Registration Default Damages”) to the
Holders of Registrable Securities in respect of the Securities as
follows:
(a) if
the
Shelf Registration Statement is not filed with the Commission on or prior to
the
90th
day
following the Closing Date, then commencing on the 91st
day
after the Closing Date, Registration Default Damages shall accrue on the
Securities and shall be computed by increasing the applicable dividend rate
of
the Preferred Stock for the relevant period by 0.25% per year for the first
90
days from and including such 91st
day
after the Closing Date and .50% per annum thereafter (it being understood that
Registration Default Damages shall not exceed 0.50% per annum);
(b) if
the
Shelf Registration Statement is not declared effective by the Commission on
or
prior to the 180th day
following the Closing Date, then commencing on the 181st
day
after the Closing Date, Registration Default Damages shall accrue on the
Securities and shall be computed by increasing the applicable dividend rate
of
the Preferred Stock for the relevant period by 0.25% per year for the first
90
days from and including such 181st
day
after the Closing Date and .50% per annum thereafter (it being understood that
Registration Default Damages shall not exceed 0.50% per annum); or
(c) if
the
Shelf Registration Statement has been declared effective but ceases to be
effective (other than pursuant to Section 3(i) hereof) at any time during the
Shelf Registration Period, then commencing on the day the Shelf Registration
Statement ceases to be effective, Registration Default Damages shall accrue
on
the Securities and shall be computed by increasing the applicable dividend
rate
of the Preferred Stock for the relevant period by 0.25% per year for the first
90 days from and including such date on which the Shelf Registration Statement
ceases to be effective and .50% per annum thereafter (it being understood that
Registration Default Damages shall not exceed 0.50% per annum); or
(d) if
the
aggregate duration of Deferral Periods in any period exceeds the number of
days
permitted in respect of such period pursuant to Section 3(i) hereof, then
commencing on the day the aggregate duration of Deferral Periods in any period
exceeds the number of days permitted in respect of such period, Registration
Default Damages shall accrue on the Securities and shall be computed by
increasing the applicable dividend rate of the Preferred Stock for the relevant
period by 0.25% per year for the first 90 days from and including such date,
and
.50% per annum thereafter (it being understood that Registration Default Damages
shall not exceed 0.50% per annum);
provided,
however,
that
(1) upon the filing of the Shelf Registration Statement (in the case of
paragraph (a) above), (2) upon the effectiveness of the Shelf Registration
Statement (in the case of paragraph (b) above), (3) upon the effectiveness
of
the Shelf Registration Statement which had ceased to remain effective (in the
case of paragraph (c) above), or (4) upon the termination
of
the
Deferral Period that caused the limit on the aggregate duration of Deferral
Periods in a period set forth in Section 3(i) to be exceeded (in the case of
paragraph (d) above), Registration Default Damages shall cease to
accrue.
Registration
Default Damages will be payable to the holders entitled thereto, in the manner
provided for the payment of dividends in the Certificate of
Designation.
(e) No
Registration Default Damages will accrue or be payable on the Underlying Common
Stock. Registration Default Damages that have accrued on the Securities will
be
cancelled upon conversion of the Preferred Stock into the Underlying Common
Stock.
8.
No
Inconsistent Agreements.
The
Company has not entered into, and agrees not to enter into, any agreement with
respect to its securities that is inconsistent with the rights granted to the
Holders herein or that otherwise conflicts with the provisions
hereof.
9.
Amendments
and Waivers.
The
provisions of this Agreement may not be amended, qualified, 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 the
Holders of a majority of the Registrable Securities outstanding; provided that,
with
respect to any matter that directly or indirectly affects the rights of any
Initial Purchaser hereunder, the Company shall obtain the written consent of
each such Initial Purchaser against which such amendment, qualification,
supplement, waiver or consent is to be effective; provided, further, that no
amendment, qualification, supplement, waiver or consent with respect to Section
8 hereof shall be effective as against any Holder of Registered Securities
unless consented to in writing by such Holder; and provided,
further,
that
the provisions of this Article 9 may not be amended, qualified, 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 the
Initial Purchasers and each Holder.
10.
Notices.
All
notices and other communications provided for or permitted hereunder shall
be
made in writing by hand-delivery, first-class mail, telex, telecopier or air
courier guaranteeing overnight delivery:
(a) if
to a
Holder, at the most current address given by such Holder to the Company in
accordance with the provisions of the Notice and Questionnaire, which address
initially is, with respect to each Holder, the address of such Holder maintained
by the transfer agent of the Company;
(b) if
to the
Initial Purchasers or the Representative, initially at the address or addresses
set forth in the Purchase Agreement; and
(c) if
to the
Company, initially at its address set forth in the Purchase
Agreement.
All
such
notices and communications shall be deemed to have been duly given when
received.
The
Initial Purchasers or the Company by notice to the other parties may designate
additional or different addresses for subsequent notices or
communications.
11.
Remedies.
Each
Holder, in addition to being entitled to exercise all rights provided to it
herein, pursuant to the terms of the Securities or 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 it of the provisions of this Agreement and
hereby agrees to waive in any action for specific performance the defense that
a
remedy at law would be adequate.
12.
Successors.
This
Agreement shall inure to the benefit of and be binding upon the parties hereto,
their respective successors and assigns, including, without the need for an
express assignment or any consent by the Company thereto, subsequent Holders
of
Registrable Securities, and the indemnified persons referred to in Section
5
hereof. The Company hereby agrees to extend the benefits of this Agreement
to
any Holder of Registrable Securities, and any such Holder may specifically
enforce the provisions of this Agreement as if an original party
hereto.
13.
Counterparts.
This
Agreement may be signed in one or more counterparts, each of which shall
constitute an original and all of which together shall constitute one and the
same agreement.
14.
Headings.
The
section headings used herein are for convenience only and shall not affect
the
construction hereof.
15.
Applicable
Law.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of New York applicable to contracts made and to be performed in the State
of New York. The parties hereto each hereby waive any right to trial by jury
in
any action, proceeding or counterclaim arising out of or relating to this
Agreement.
16.
Severability.
In the
event that any one of more of the provisions contained herein, or the
application thereof in any circumstances, is held invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions hereof shall not be in any way impaired or affected thereby, it
being
intended that all of the rights and privileges of the parties shall be
enforceable to the fullest extent permitted by law.
17.
Securities
Held by the Company, etc.
Whenever
the consent or approval of Holders of a specified number of Registrable
Securities is required hereunder, Registrable Securities held by the Company
or
its Affiliates (other than subsequent Holders of Registrable Securities if
such
subsequent Holders are deemed to be Affiliates solely by reason of their
holdings of such Registrable Securities) shall not be counted in determining
whether such consent or approval was given by the Holders of such required
percentage.
If
the
foregoing is in accordance with your understanding of our agreement, please
sign
and return to us the enclosed duplicate hereof, whereupon this letter and your
acceptance shall represent a binding agreement between the Company and the
several Initial Purchasers.
| Very truly yours, | ||
| |
|
|
| By: | /s/ | |
|
Name:
|
||
| Title: | ||
The
foregoing Agreement is hereby confirmed and
accepted
as of the date first above written.
Citigroup
Global Markets Inc.
By
/s/
Name:
Title:
For
themselves and the other several
Initial
Purchasers named in Schedule I
to
the
Purchase Agreement
