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A/B EXCHANGE
REGISTRATION RIGHTS AGREEMENT
Dated as of December 11, 1998
by and among
L-3 COMMUNICATIONS CORPORATION
THE GUARANTORS LISTED ON THE SIGNATURE PAGES HERETO
AND
XXXXXX BROTHERS INC.
and
NATIONSBANC XXXXXXXXXX SECURITIES LLC
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A/B EXCHANGE REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is made and
entered into as of December 11, 1998 by and among L-3 Communications
Corporation, a Delaware corporation (the "Company"), Hygienetics Environmental
Services, Inc., a Delaware corporation, L-3 Communications ILEX Systems, Inc.,
a Delaware corporation, Southern California Microwave, Inc., a California
corporation, L-3 Communications SPD Technologies, Inc., a Delaware corporation,
L-3 Communications ESSCO, Inc., a Delaware corporation, Storm Control Systems,
Inc., a California corporation, DBS Microwave, Inc., a California corporation,
SPD Electrical Systems, Inc., a Delaware corporation, SPD Switchgear Inc., a
Delaware corporation, Pac Ord Inc., a Delaware corporation, Xxxxxxxx Inc., a
Delaware corporation, Power Paragon, Inc., a Delaware corporation, and SPD
Holdings, Inc., a Delaware corporation (collectively, the "Existing
Guarantors"), and Xxxxxx Brothers Inc. and NationsBanc Xxxxxxxxxx Securities
LLC (together, the "Initial Purchasers"), each of whom has agreed to purchase
the Company's 8% Senior Subordinated Notes due 2008 (the "Series A Notes")
pursuant to the Purchase Agreement (as defined below).
This Agreement is made pursuant to the Purchase Agreement, dated as of
December 11, 1998 (the "Purchase Agreement"), by and among the Company, the
Existing Guarantors and the Initial Purchasers. In order to induce the Initial
Purchasers to purchase the Series A Notes, the Company and the Existing
Guarantors have agreed to provide the registration rights set forth in this
Agreement. The execution and delivery of this Agreement is a condition to the
obligations of the Initial Purchasers set forth in Section 3 of the Purchase
Agreement.
The parties hereby agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement, the following capitalized terms shall have
the following meanings:
Act: The Securities Act of 1933, as amended.
Additional Guarantor: Any subsidiary of the Company that executes a
Subsidiary Guarantee under the Indenture after the date of this Agreement.
Broker-Dealer: Any broker or dealer registered under the Exchange Act.
Broker-Dealer Transfer Restricted Securities: Series B Notes
(including the Subsidiary Guaranteess) that are acquired by a Restricted
Broker-Dealer for its own account as a result of market-making activities or
other trading activities.
Closing Date: The date of this Agreement.
Commission: The Securities and Exchange Commission.
Consummate: A Registered Exchange Offer shall be deemed "Consummated"
for purposes of this Agreement upon the occurrence of (i) the filing and
effectiveness under the Act of the Exchange Offer Registration Statement
relating to the Series B Notes to be issued in the Exchange Offer, (ii) the
maintenance of such Registration Statement continuously effective and the
keeping of the Exchange Offer open for a period not less than the minimum
period required pursuant to Section 3(b) hereof, and (iii) the delivery by the
Company to the Registrar under the Indenture of Series B Notes in the same
aggregate principal amount as the aggregate principal amount of Series A Notes
that were tendered by Holders thereof pursuant to the Exchange Offer.
Damages Payment Date: With respect to the Series A Notes, each
Interest Payment Date.
Effectiveness Target Date: As defined in Section 5.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Exchange Offer: The registration by the Company under the Act of the
Series B Notes (including the Subsidiary Guaranteess) pursuant to a
Registration Statement pursuant to which the Company offers the Holders of all
outstanding Transfer Restricted Securities the opportunity to exchange all such
outstanding Transfer Restricted Securities held by such Holders for Series B
Notes and registered Subsidiary Guarantees in an aggregate principal amount
equal to the aggregate principal amount of the Transfer Restricted Securities
tendered in such exchange offer by such Holders.
Exchange Offer Registration Statement: The Registration Statement
relating to the Exchange Offer, including the related Prospectus.
Exempt Resales: The transactions in which the Initial Purchasers
propose to sell the Series A Notes to (i) certain "qualified institutional
buyers," as such term is defined in Rule 144A under the Act, (ii) to certain
institutional "accredited investors," as such term is defined in Rule
501(a)(1), (2), (3) and (7) under the Act ("Accredited Institutions") and (iii)
outside the United States to Persons other than U.S. Persons in offshore
transactions meeting the requirements of rule 904 of Regulation S under the
Act.
Guarantor: The Additional Guarantors and the Existing Guarantors.
Holders: As defined in Section 2(b) hereof.
Indemnified Holder: As defined in Section 8(a) hereof.
Indenture: The Indenture, dated as of the date hereof, among the
Company, the Existing Guarantors and The Bank of New York, as trustee (the
"Trustee"), pursuant to which the Notes are to be issued, as such Indenture is
amended or supplemented from time to time in accordance with the terms thereof.
Initial Purchasers: As defined in the preamble hereto.
Interest Payment Date: As defined in the Indenture and the Notes.
Market-Maker Prospectus: As defined in Section 4 hereof.
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NASD: National Association of Securities Dealers, Inc.
Notes: The Series A Notes and the Series B Notes.
Person: An individual, partnership, corporation, trust or
unincorporated organization, or a government or agency or political subdivision
thereof.
Prospectus: The prospectus included in a Registration Statement
including, without limitation, a Market-Maker Prospectus, as amended or
supplemented by any prospectus supplement and by all other amendments thereto,
including post-effective amendments, and all material incorporated by reference
into such Prospectus.
Record Holder: With respect to any Damages Payment Date relating to
Notes, each Person who is a Holder of Notes on the record date with respect to
the Interest Payment Date on which such Damages Payment Date shall occur.
Registration Default: As defined in Section 5 hereof.
Registration Statement: Any Registration Statement of the Company
relating to (a) an offering of Series B Notes pursuant to an Exchange Offer or
(b) the registration for resale of Transfer Restricted Securities pursuant to
the Shelf Registration Statement, which is filed pursuant to the provisions of
this Agreement including the registration for resale of Broker-Dealer Transfer
Restricted Securities, in each case including the Prospectus included therein,
all amendments and supplements thereto (including post-effective amendments)
and all exhibits and material incorporated by reference therein.
Restricted Broker-Dealer: Any Broker-Dealer that is an affiliate of
the Company that holds Broker-Dealer Transfer Restricted Securities.
Series B Notes: The Company's 8% Senior Subordinated Notes due 2008 to
be issued pursuant to the Indenture in the Exchange Offer.
Shelf Filing Deadline: As defined in Section 4 hereof.
Shelf Registration Statement: As defined in Section 4 hereof.
Subsidiary Guarantee: The Guarantee by a Guarantor of the Company's
obligations under the Notes and Indenture.
TIA: The Trust Indenture Act of 1939 (15 U.S.C. Section 77aaa-77bbbb)
as in effect on the date of the Indenture.
Transfer Restricted Securities: Each Note (including the Subsidiary
Guarantees), until the earliest to occur of (a) the date on which such Note is
exchanged in the Exchange Offer and entitled to be resold to the public by the
Holder thereof without complying with the prospectus delivery requirements of
the Act, (b) the date on which such Note (including the Subsidiary Guarantees)
has been effectively registered under the Act and disposed of in accordance
with a Shelf Registration
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Statement and (c) the date on which such Note (including the Subsidiary
Guarantees) is distributed to the public pursuant to Rule 144 under the Act or
by a Broker-Dealer pursuant to the "Plan of Distribution" contemplated by the
Exchange Offer Registration Statement (including delivery of the Prospectus
contained therein).
Underwritten Registration or Underwritten Offering: A registration in
which securities of the Company are sold to an underwriter for reoffering to
the public.
SECTION 2. SECURITIES SUBJECT TO THIS AGREEMENT
2.1 Transfer Restricted Securities and Broker-Dealer Transfer
Restricted Securities. The securities entitled to the benefits of this
Agreement are the Transfer Restricted Securities and Broker-Dealer Transfer
Restricted Securities.
2.2 Holders of Transfer Restricted Securities. A Person is deemed to
be a holder of Transfer Restricted Securities (each, a "Holder") whenever such
Person owns Transfer Restricted Securities.
2.3 Holders of Broker-Dealer Transfer Restricted Securities. A
Restricted Broker-Dealer is deemed to be a holder of Broker-Dealer Transfer
Restricted Securities (each, a "Holder") whenever such Restricted Broker-Dealer
owns Broker-Dealer Transfer Restricted Securities.
SECTION 3. REGISTERED EXCHANGE OFFER
3.1 Unless the Exchange Offer shall not be permissible under
applicable law or Commission policy (after the procedures set forth in Section
6(a) below have been complied with), the Company and the Guarantors shall (i)
cause to be filed with the Commission as soon as practicable after the Closing
Date, but in no event later than 90 days after the Closing Date, a Registration
Statement under the Act relating to the Series B Notes (including the
Subsidiary Guarantees) and the Exchange Offer, (ii) use all commercially
reasonable efforts to cause such Registration Statement to become effective at
the earliest possible time, but in no event later than 150 days after the
Closing Date (which 150-day period shall be extended for a number of days equal
to the number of business days, if any, the Commission is officially closed
during such period), (iii) in connection with the foregoing, file (A) all
pre-effective amendments to such Registration Statement as may be necessary in
order to cause such Registration Statement to become effective, (B) if
applicable, a post-effective amendment to such Registration Statement pursuant
to Rule 430A under the Act and (C) cause all necessary filings in connection
with the registration and qualification of the Series B Notes (including the
Subsidiary Guarantees) to be made under the Blue Sky laws of such
jurisdictions as are necessary to permit Consummation of the Exchange Offer,
and (iv) upon the effectiveness of such Registration Statement, commence the
Exchange Offer. The Exchange Offer shall be on the appropriate form permitting
registration of the Series B Notes (including the Subsidiary Guarantees) to be
offered in exchange for the Transfer Restricted Securities and to permit
resales of Notes held by Broker-Dealers as contemplated by Section 3(c) below.
3.2 The Company and the Guarantors shall cause the Exchange Offer
Registration Statement to be effective continuously and shall keep the Exchange
Offer open for a period of not less than the minimum period required under
applicable federal and state securities laws to
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Consummate the Exchange Offer; provided, however, that in no event shall such
period be less than 20 business days. The Company and the Guarantors shall
cause the Exchange Offer to comply with all applicable federal and state
securities laws. No securities other than the Notes (including the Subsidiary
Guaranteess) shall be included in the Exchange Offer Registration Statement.
The Company and the Guarantors shall use their best efforts to cause the
Exchange Offer to be Consummated on the earliest practicable date after the
Exchange Offer Registration Statement has become effective, but in no event
later than 30 business days thereafter.
3.3 The Company and the Guarantors shall indicate in a "Plan of
Distribution" section contained in the Prospectus contained in the Exchange
Offer Registration Statement that any Broker-Dealer who holds Series A Notes
that are Transfer Restricted Securities and that were acquired for its own
account as a result of market-making activities or other trading activities
(other than Transfer Restricted Securities acquired directly from the Company),
may exchange such Series A Notes pursuant to the Exchange Offer; however, such
Broker-Dealer may be deemed to be an "underwriter" within the meaning of the
Act and must, therefore, deliver a Prospectus meeting the requirements of the
Act in connection with any resales of the Series B Notes received by such
Broker-Dealer in the Exchange Offer, which Prospectus delivery requirement may
be satisfied by the delivery by such Broker-Dealer of the Prospectus contained
in the Exchange Offer Registration Statement. Such "Plan of Distribution"
section shall also contain all other information with respect to such resales
by Broker-Dealers that the Commission may require in order to permit such
resales pursuant thereto, but such "Plan of Distribution" shall not name any
such Broker-Dealer or disclose the amount of Notes held by any such
Broker-Dealer except to the extent required by the Commission.
The Company and the Guarantors shall use all commercially reasonable
efforts to keep the Exchange Offer Registration Statement continuously
effective, supplemented and amended as required by the provisions of Section
6(d) below to the extent necessary to ensure that it is available for resales
of Notes acquired by Broker-Dealers for their own accounts as a result of
market-making activities or other trading activities, and to ensure that it
conforms with the requirements of this Agreement, the Act and the policies,
rules and regulations of the Commission as announced from time to time, for a
period of 180 days from the date on which the Exchange Offer Registration
Statement is declared effective.
The Company and the Guarantors shall provide sufficient copies of the
latest version of such Prospectus to Broker-Dealers promptly upon request at
any time during such 180 day period in order to facilitate such resales.
SECTION 4. SHELF REGISTRATION; MARKET-MAKER
PROSPECTUS
4.1 Shelf Registration. If (i) the Company and the Guarantors are not
required to file an Exchange Offer Registration Statement or to Consummate the
Exchange Offer because the Exchange Offer is not permitted by applicable law or
Commission policy (after the procedures set forth in Section 6(a) below have
been complied with) or (ii) if any Holder of Transfer Restricted Securities
that is a "qualified institutional buyer," as such term is defined in Rule 144A
under the Act or an institutional "accredited investor," as such term is
defined in Rule 501(a)(1), (2), (3) and
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(7) under the Act shall notify the Company prior to the 20th business day
following the Consummation of the Exchange Offer that such Holder alone or
together with holders who hold in the aggregate at least $1.0 million in
principal amount of Series A Notes (A) is prohibited by applicable law or
Commission policy from participating in the Exchange Offer, or (B) may not
resell the Series B Notes acquired by it in the Exchange Offer to the public
without delivering a prospectus and that the Prospectus contained in the
Exchange Offer Registration Statement is not appropriate or available for such
resales by such Holder, or (C) is a Broker-Dealer and holds Series A Notes
acquired directly from the Company or one of its affiliates, then the Company
and the Guarantors shall
(x) cause to be filed a shelf Registration Statement pursuant to Rule
415 under the Act, which may be an amendment to the Exchange Offer
Registration Statement (in either event, the "Shelf Registration
Statement") on or prior to the earliest to occur of (1) the 30th day after
the date on which the Company determines that it is not required to file
the Exchange Offer Registration Statement, or permitted to Consummate the
Exchange Offer and (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) of paragraph (a) above (such earliest date
being the "Shelf Filing Deadline"), which Shelf Registration Statement
shall provide for resales of all Transfer Restricted Securities the
Holders of which shall have provided the information required pursuant to
Section 4(b) hereof; and
(y) use all commercially reasonable efforts to cause such Shelf
Registration Statement to be declared effective by the Commission on or
before the 90th day after the Shelf Filing Deadline.
The Company and the Guarantors shall use all commercially reasonable efforts to
keep such Shelf Registration Statement continuously effective, supplemented and
amended as required by the provisions of Sections 6(b) and (d) hereof to the
extent necessary to ensure that it is available for resales of Notes by the
Holders of Transfer Restricted Securities entitled to the benefit of this
Section 4(a), and to ensure that it conforms with the requirements of this
Agreement, the Act and the policies, rules and regulations of the Commission as
announced from time to time, for a period of at least two years following the
Closing Date or such shorter period that will terminate when all Notes covered
by the Shelf Registration Statement have been sold pursuant to the Shelf
Registration Statement or become eligible for resale pursuant to Rule 144
without volume or other restrictions.
4.2 Provision by Holders of Certain Information in Connection with the
Shelf Registration Statement. No Holder of Transfer Restricted Securities may
include any of its Transfer Restricted Securities in any Shelf Registration
Statement pursuant to this Agreement unless and until such Holder furnishes to
the Company in writing, within 10 business days after receipt of a request
therefor, such information as the Company may reasonably request for use in
connection with any Shelf Registration Statement or Prospectus or preliminary
Prospectus included therein. No Holder of Transfer Restricted Securities shall
be entitled to Liquidated Damages pursuant to Section 5 hereof unless and until
such Holder shall have used its best efforts to provide all such reasonably
requested information. Each Holder as to which any Shelf Registration Statement
is being effected agrees to furnish promptly to the Company all information
required to be disclosed in order to make the information previously furnished
to the Company by such Holder not materially misleading.
4.3 Market-Maker Prospectus. The Company and the Guarantors
acknowledge that any Restricted Broker-Dealer holding Broker-Dealer Transfer
Restricted Securities may not
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resell such Broker-Dealer Transfer Restricted Securities without delivering a
Prospectus. Consequently, on the date that the Exchange Offer Registration
Statement is filed with the Commission, the Company and the Guarantors shall
file a Registration Statement (which may be the Exchange Offer Registration
Statement or the Shelf Registration Statement if permitted by the rules and
regulations of the Commission) and shall use their best efforts to cause such
Registration Statement to be declared effective by the Commission on or prior
to the Consummation of the Exchange Offer. The Company and the Guarantors shall
use all commercially reasonable efforts to keep such Registration Statement
continuously effective, supplemented and amended as required by the provisions
of Sections 6(c) and (d) hereof to the extent necessary to ensure that it is
available for resales of Broker-Dealer Transfer Restricted Securities by
Restricted Broker-Dealers, and to ensure that it conforms with the requirements
of this Agreement, the Act and the policies, rules and regulations of the
Commission as announced from time to time, until such time as all Restricted
Broker-Dealers determine in their judgment that they are no longer required to
deliver a Prospectus in connection with sales of Broker-Dealer Transfer
Restricted Securities. The Prospectus included in such Registration Statement
is referred to in this Agreement as a "Market-Maker Prospectus."
SECTION 5. LIQUIDATED DAMAGES
If (i) any of the Registration Statements required by this Agreement
is not filed with the Commission on or prior to the date specified for such
filing in sections 3(a), 4(a), and 4(c), as applicable, (ii) any of such
required Registration Statements has not been declared effective by the
Commission on or prior to the date specified for such effectiveness in sections
3(a), 4(a), and 4(c), as applicable, (the "Effectiveness Target Date"), (iii)
the Exchange Offer has not been Consummated within 30 business days after the
Effectiveness Target Date with respect to the Exchange Offer Registration
Statement or (iv) any Registration Statement required by this Agreement is
filed and declared effective but shall thereafter cease to be effective or fail
to be usable for its intended purpose without being succeeded immediately by a
post-effective amendment to such Registration Statement that cures such failure
and that is itself immediately declared effective (each such event referred to
in clauses (i) through (iv), a "Registration Default"), the Company and the
Guarantors jointly and severally agree to pay liquidated damages to each Holder
of Transfer Restricted Securities with respect to the first 90-day period
immediately following the occurrence of such Registration Default, in an amount
equal to $.05 per week per $1,000 principal amount of Transfer Restricted
Securities held by such Holder for each week or portion thereof that the
Registration Default continues. The amount of the liquidated damages shall
increase by an additional $.05 per week per $1,000 in principal amount of
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 $.50 per week per $1,000 principal amount of Transfer
Restricted Securities. All accrued liquidated damages shall be paid to Record
Holders by the Company and the Guarantors by wire transfer of immediately
available funds or by federal funds check on each Damages Payment Date, as
provided in the Indenture. Following the cure of all Registration Defaults
relating to any particular Transfer Restricted Securities, the accrual of
liquidated damages with respect to such Transfer Restricted Securities will
cease.
All payment obligations of the Company and the Guarantors set forth in
the preceding paragraph that are outstanding with respect to any Transfer
Restricted Security at the time such security ceases to be a Transfer
Restricted Security shall survive until such time as all such payment
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obligations with respect to such Security shall have been satisfied in full.
SECTION 6. REGISTRATION PROCEDURES
6.1 Exchange Offer Registration Statement. In connection with the
Exchange Offer, the Company and the Guarantors shall comply with all of the
provisions of Section 6(d) below, shall use all commercially reasonable efforts
to effect such exchange to permit the sale of Transfer Restricted Securities
being sold in accordance with the intended method or methods of distribution
thereof, and shall comply with all of the following provisions:
(a) If in the reasonable opinion of counsel to the Company and the
Guarantors there is a question as to whether the Exchange Offer is
permitted by applicable law, the Company and the Guarantors hereby agree
to seek a no-action letter or other favorable decision from the Commission
allowing the Company and the Guarantors to Consummate an Exchange Offer
for such Series A Notes. The Company and the Guarantors hereby agree to
pursue the issuance of such a decision to the Commission staff level but
shall not be required to take commercially unreasonable action to effect a
change of Commission policy. The Company and the Guarantors hereby agree
however, to (A) participate in telephonic conferences with the Commission,
(B) deliver to the Commission staff an analysis prepared by counsel to the
Company and the Guarantors setting forth the legal bases, if any, upon
which such counsel has concluded that such an Exchange Offer should be
permitted and (C) diligently pursue a resolution (which need not be
favorable) by the Commission staff of such submission.
(b) As a condition to its participation in the Exchange Offer
pursuant to the terms of this Agreement, each Holder of Transfer
Restricted Securities shall furnish, upon the request of the Company,
prior to the Consummation thereof, a written representation to the Company
and the Guarantors (which may be contained in the letter of transmittal
contemplated by the Exchange Offer Registration Statement) to the effect
that (A) it is not an affiliate of the Company, (B) it is not engaged in,
and does not intend to engage in, and has no arrangement or understanding
with any person to participate in, a distribution of the Series B Notes to
be issued in the Exchange Offer and (C) it is acquiring the Series B Notes
in its ordinary course of business. In addition, all such Holders of
Transfer Restricted Securities shall otherwise cooperate in the Company's
and the Guarantors' preparations for the Exchange Offer. Each Holder
hereby acknowledges and agrees that any Broker-Dealer and any such Holder
using the Exchange Offer to participate in a distribution of the
securities to be acquired in the Exchange Offer (1) could not under
Commission policy as in effect on the date of this Agreement rely on the
position of the Commission enunciated in Xxxxxx Xxxxxxx and Co., Inc.
(available June 5, 1991) and Exxon Capital Holdings Corporation (available
May 13, 1988), as interpreted in the Commission's letter to Shearman &
Sterling dated July 2, 1993, and similar no-action letters (including any
no-action letter obtained pursuant to clause (i) above), and (2) must
comply with the registration and prospectus delivery requirements of the
Act in connection with a secondary resale transaction and that such a
secondary resale transaction should be covered by an effective
Registration Statement containing the selling security holder information
required by Item 507 or 508, as applicable, of Regulation S-K if the
resales are of Series B Notes obtained by such Holder in exchange for
Series A Notes acquired by such Holder directly from the Company.
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(c) Prior to effectiveness of the Exchange Offer Registration
Statement, the Company and the Guarantors shall provide a supplemental
letter to the Commission (A) stating that the Company and the Guarantors
are registering the Exchange Offer in reliance on the position of the
Commission enunciated in Exxon Capital Holdings Corporation (available May
13, 1988), Xxxxxx Xxxxxxx and Co., Inc. (available June 5, 1991) and, if
applicable, any no-action letter obtained pursuant to clause (i) above and
(B) including a representation that neither the Company nor any Guarantor
has entered into any arrangement or understanding with any Person to
distribute the Series B Notes to be received in the Exchange Offer and
that, to the best of the Company's and each Guarantor's information and
belief, each Holder participating in the Exchange Offer is acquiring the
Series B Notes in its ordinary course of business and has no arrangement
or understanding with any Person to participate in the distribution of the
Series B Notes received in the Exchange Offer.
6.2 (a) Shelf Registration Statement. In connection with the Shelf
Registration Statement, the Company and the Guarantors shall comply with all
the provisions of Section 6(d) below and shall use all commercially reasonable
efforts to effect such registration to permit the sale of the Transfer
Restricted Securities being sold in accordance with the intended method or
methods of distribution thereof, and pursuant thereto the Company and the
Guarantors will as expeditiously as possible prepare and file with the
Commission a Registration Statement relating to the registration on any
appropriate form under the Act, which form shall be available for the sale of
the Transfer Restricted Securities in accordance with the intended method or
methods of distribution thereof.
6.3 Market-Maker Prospectus. In connection with any Registration
Statement filed pursuant to Section 4(c) of this Agreement, the Company and the
Guarantors will comply with all of the provisions of Section 6(d) below (other
than sub-sections (xiii), (xiv), (xv), (xvii) and (xx)) until such time as all
Restricted Broker-Dealers determine in their judgment that they are no longer
required to deliver Market-Maker Prospectuses in connection with sales of
Broker-Dealer Transfer Restricted Securities. The Company and the Guarantors
shall use all commercially reasonable efforts to deliver Market-Maker
Prospectuses to all Restricted Broker-Dealers immediately upon the
effectiveness of the Registration Statement and from time to time thereafter
upon request, in such quantities as such Restricted Broker-Dealer shall
require.
6.4 General Provisions. In connection with any Registration Statement
and any Prospectus required by this Agreement to permit the sale or resale of
Transfer Restricted Securities (including, without limitation, any Registration
Statement and the related Prospectus required to permit resales of Notes by
Broker-Dealers) and Broker-Dealer Transfer Restricted Securities, the Company
and the Guarantors shall:
(a) use all commercially reasonable efforts to keep such Registration
Statement continuously effective and provide all requisite financial
statements (including, if required by the Act or any regulation
thereunder, financial statements of any Guarantors) for the period
specified in Section 3 or 4 of this Agreement, as applicable; upon the
occurrence of any event that would cause any such Registration Statement
or the Prospectus contained therein (A) to contain a material misstatement
or omission or (B) not to be effective and usable for resale of Transfer
Restricted Securities or Broker-Dealer Transfer
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Restricted Securities during the period required by this Agreement, the Company
and the Guarantors shall file promptly an appropriate amendment to such
Registration Statement, in the case of clause (A), correcting any such
misstatement or omission, and, in the case of either clause (A) or (B), use all
commercially reasonable efforts to cause such amendment to be declared
effective and such Registration Statement and the related Prospectus to become
usable for their intended purpose(s) as soon as practicable thereafter.
Notwithstanding the foregoing, at any time after Consummation of the Exchange
Offer, the Company and the Guarantors may allow the Shelf Registration
Statement or Market-Maker Prospectus and the related Registration Statement to
cease to become effective and usable if (x) the board of directors of the
Company determines in good faith that it is in the best interests of the
Company not to disclose the existence of or facts surrounding any proposed or
pending material corporate transaction involving the Company and the
Guarantors, and the Company notifies the Holders within two business days after
the Board of Directors makes such determination, or (y) the Prospectus
contained in the Shelf Registration Statement or the Market-Maker Prospectus,
as the case may be, contains an untrue statement of the material fact or omits
to state a material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading; provided
that the two-year period referred to in Section 4(a) hereof during which the
Shelf Registration Statement is required to be effective and usable shall be
extended by the number of days during which such Registration Statement was not
effective or usable pursuant to the foregoing provisions;
(b) prepare and file with the Commission such amendments and
post-effective amendments to the Registration Statement as may be
necessary to keep the Registration Statement effective for the applicable
period set forth in Section 3 or 4 hereof, as applicable; cause the
Prospectus to be supplemented by any required Prospectus supplement, and
as so supplemented to be filed pursuant to Rule 424 under the Act, and to
comply fully with the applicable provisions of Rules 424 and 430A under
the Act in a timely manner; and comply with the provisions of the Act with
respect to the disposition of all securities covered by such Registration
Statement during the applicable period in accordance with the intended
method or methods of distribution by the sellers thereof set forth in such
Registration Statement or supplement to the Prospectus;
(c) advise the underwriter(s), if any, and selling Holders of
Transfer Restricted Securities and, following the Consummation of the
Exchange Offer, Holders of Broker Dealer Transfer Restricted Securities,
promptly and, if requested by such Persons, to confirm such advice in
writing, (A) when the Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to any
Registration Statement or any post-effective amendment thereto, when the
same has become effective, (B) of any request by the Commission for
amendments to the Registration Statement or amendments or supplements to
the Prospectus or for additional information relating thereto, (C) of the
issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement under the Act or of the suspension by any
state securities commission of the qualification of the Transfer
Restricted Securities or Broker-Dealer Transfer Restricted Securities, as
applicable, for offering or sale in any jurisdiction, or the initiation of
any proceeding for any of the preceding purposes, (D) of the existence of
any fact or the happening of any event that makes any statement of a
material fact made in the Registration Statement, the Prospectus, any
amendment or supplement thereto, or any document
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incorporated by reference therein untrue, or that requires the making of
any additions to or changes in the Registration Statement or the
Prospectus in order to make the statements therein not misleading. If at
any time the Commission shall issue any stop order suspending the
effectiveness of the Registration Statement, or any state securities
commission or other regulatory authority shall issue an order suspending
the qualification or exemption from qualification of the Transfer
Restricted Securities or Broker-Dealer Transfer Restricted Securities, as
applicable, under state securities or Blue Sky laws, the Company and the
Guarantors shall use all commercially reasonable efforts to obtain the
withdrawal or lifting of such order at the earliest possible time;
(d) furnish to each of the selling Holders of Transfer Restricted
Securities or Holders of Broker-Dealer Transfer-Restricted Securities and
each of the underwriter(s), if any, before filing with the Commission,
copies of any Registration Statement or any Prospectus included therein or
any amendments or supplements to any such Registration Statement or
Prospectus (including all documents incorporated by reference after the
initial filing of such Registration Statement), which documents will be
subject to the review of such Holders and underwriter(s), if any, for a
period of at least five business days, and the Company and the Guarantors
will not file any such Registration Statement or Prospectus or any
amendment or supplement to any such Registration Statement or Prospectus
(including all such documents incorporated by reference) if a selling
Holder of Transfer Restricted Securities or a Holder of Broker-Dealer
Transfer Restricted Securities, as applicable, covered by such
Registration Statement or the underwriter(s), if any, shall not have had
an opportunity to participate in the preparation thereof;
(e) promptly prior to the filing of any document that is to be
incorporated by reference into a Registration Statement or Prospectus,
provide copies of such document to the selling Holders or the Holders of
Broker-Dealer Transfer Restricted Securities, as applicable, and to the
underwriter(s), if any, make the Company's and the Guarantors'
representatives available for discussion of such document and other
customary due diligence matters, and include such information in such
document prior to the filing thereof as such selling Holders or the
Holders of Broker-Dealer Transfer Restricted Securities, as applicable, or
underwriter(s), if any, reasonably may request;
(f) make available at reasonable times at the Company's principal
place of business for inspection by the selling Holders of Transfer
Restricted Securities, any underwriter participating in any disposition
pursuant to such Registration Statement, and any attorney or accountant
retained by such selling Holders or any of the underwriter(s) who shall
certify to the Company and the Guarantors that they have a current
intention to sell Transfer Restricted Securities or Broker-Dealer Transfer
Restricted Securities pursuant to a Shelf Registration Statement or
Market-Maker Prospectus, and, following the Consummation of the Exchange
Offer, the Holders of Broker-Dealer Transfer Restricted Securities, such
financial and other information of the Company and the Guarantors as
reasonably requested and cause the Company's and the Guarantors' officers,
directors and employees to respond to such inquiries as shall be
reasonably necessary, in the reasonable judgment of counsel to such
Holders, to conduct a reasonable investigation; provided, however, that
each such party shall be required to maintain in confidence and not to
disclose to any other person any
-11-
information or records reasonably designated by the Company in writing as
being confidential, until such time as (A) such information becomes a
matter of public record (whether by virtue of its inclusion in such
Registration Statement or otherwise), or (B) such person shall be required
so to disclose such information pursuant to the subpoena or order of any
court or other governmental agency or body having jurisdiction over the
matter (subject to the requirements of such order, and only after such
person shall have given the Company prompt prior written notice of such
requirement), or (C) such information is required to be set forth in such
Registration Statement or the Prospectus included therein or in an
amendment to such Registration Statement or an amendment or supplement to
such Prospectus in order that such Registration Statement, Prospectus,
amendment or supplement, as the case may be, does not contain an untrue
statement of a material fact or omit to state therein a material fact
required to be stated therein or necessary to make the statements therein
not misleading;
(g) if requested by any selling Holders of Transfer Restricted
Securities or Holders of Broker-Dealer Transfer Restricted Securities, as
applicable, or the underwriter(s), if any, promptly incorporate in any
Registration Statement or Prospectus, pursuant to a supplement or
post-effective amendment if necessary, such information as such selling
Holders and underwriter(s), if any, may reasonably request to have
included therein, including, without limitation, information relating to
the "Plan of Distribution" of the Transfer Restricted Securities or
Broker-Dealer Transfer Restricted Securities, as applicable, information
with respect to the principal amount of Transfer Restricted Securities or
Broker- Dealer Transfer Restricted Securities, as applicable, being sold
to such underwriter(s), the purchase price being paid therefor and any
other terms of the offering of the Transfer Restricted Securities or
Broker-Dealer Transfer-Restricted Securities, as applicable, to be sold in
such offering; and make all required filings of such Prospectus supplement
or post-effective amendment as soon as practicable after the Company is
notified of the matters to be incorporated in such Prospectus supplement
or post-effective amendment;
(h) furnish to each selling Holder of Transfer Restricted Securities
or Holders of Broker-Dealer Transfer Restricted Securities, as applicable,
and each of the underwriter(s), if any, without charge, at least one copy
of the Registration Statement, as first filed with the Commission, and of
each amendment thereto, including all documents incorporated by reference
therein and all exhibits (including exhibits incorporated therein by
reference);
(i) deliver to each selling Holder of Transfer Restricted Securities
and each of the underwriter(s), if any, and each Holder of Broker-Dealer
Transfer Restricted Securities, without charge, as many copies of the
Prospectus (including each preliminary prospectus) and any amendment or
supplement thereto as such Persons reasonably may request; the Company and
the Guarantors hereby consent to the use of the Prospectus and any
amendment or supplement thereto by each of the selling Holders and each of
the underwriter(s), if any, and each Holder of Broker-Dealer Transfer
Restricted Securities, in connection with the offering and the sale of the
Transfer Restricted Securities and Broker-Dealer Transfer Restricted
Securities, as applicable, covered by the Prospectus or any amendment or
supplement thereto;
(j) enter into such agreements (including an underwriting agreement),
and make such representations and warranties, and take all such other
actions in connection
-12-
therewith in order to expedite or facilitate the disposition of the
Transfer Restricted Securities and Broker-Dealer Transfer Restricted
Securities, as applicable, pursuant to any Registration Statement
contemplated by this Agreement, all to such extent as may be requested by
the Initial Purchaser or, in the case of registration for resale of
Transfer Restricted Securities pursuant to the Shelf Registration
Statement, by any Holder or Holders of Transfer Restricted Securities who
hold at least 25% in aggregate principal amount of such class of Transfer
Restricted Securities or, in the case of Broker-Dealer Transfer Restricted
Securities, by any Holder of Broker-Dealer Transfer Restricted Securities;
provided, that, the Company and the Guarantors shall not be required to
enter into any such agreement more than once with respect to all of the
Transfer Restricted Securities and, in the case of a Shelf Registration
Statement, may delay entering into such agreement if the Board of
Directors of the Company determines in good faith that it is in the best
interests of the Company and the Guarantors not to disclose the existence
of or facts surrounding any proposed or pending material corporate
transaction involving the Company and the Guarantors; and whether or not
an underwriting agreement is entered into and whether or not the
registration is an Underwritten Registration, the Company and the
Guarantors shall:
(A) furnish to the Initial Purchaser, the Holders of Transfer
Restricted Securities who hold at least 25% in aggregate principal
amount of such class of Transfer Restricted Securities (in the case
of a Shelf Registration Statement), each Holder of Broker-Dealer
Transfer Restricted Securities and each underwriter, if any, in such
substance and scope as they may request and as are customarily made
in connection with an offering of debt securities pursuant to a
Registration Statement (i) upon the effective date of any
Registration Statement (and if such Registration Statement
contemplates an Underwritten Offering of Transfer Restricted
Securities or Broker-Dealer Transfer Restricted Securities, as
applicable, upon the date of the closing under the underwriting
agreement related thereto) and (ii) upon the filing of any amendment
or supplement to any Registration Statement or any other document
that is incorporated in any Registration Statement by reference and
includes financial data with respect to a fiscal quarter or year:
(1) a certificate, dated the date of effectiveness of the
Shelf Registration Statement signed by (y) the respective
Chairman of the Board, the respective President or any Vice
President and (z) the respective Chief Financial Officer of the
Company and each of the Guarantors confirming, as of the date
thereof, the matters set forth in paragraph (j) of Section 7 of
the Purchase Agreement and such other matters as such parties
may reasonably request;
(2) an opinion, dated the date of effectiveness of the
Shelf Registration Statement, as the case may be, of counsel for
the Company covering the matters set forth in paragraphs (c) (d)
and (e) of Section 7 of the Purchase Agreement and such other
matter as such parties may reasonably request, and in any event
including a statement to the effect that such counsel has
participated in conferences with officers and other
representatives of the Company, representatives of the
independent public accountants for the Company, the Initial
Purchasers' representatives and the Initial Purchasers' counsel
in connection with the preparation
-13-
of such Registration Statement and the related Prospectus and
have considered the matters required to be stated therein and
the statements contained therein, although such counsel has not
independently verified the accuracy, completeness or fairness of
such statements; and that such counsel advises that, on the
basis of the foregoing (relying as to materiality to a large
extent upon facts provided to such counsel by officers and other
representatives of the Company and without independent check or
verification), no facts came to such counsel's attention that
caused such counsel to believe that the applicable Registration
Statement, at the time such Registration Statement or any
post-effective amendment thereto became effective, and, in the
case of the Exchange Offer Registration Statement, as of the
date of Consummation, contained an untrue statement of a
material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading, or that the Prospectus contained in such
Registration Statement as of its date and, in the case of the
opinion dated the date of Consummation of the Exchange Offer, as
of the date of Consummation, contained an untrue statement of a
material fact or omitted to state a material fact necessary in
order to make the statements therein, in light of the
circumstances under which they were made, not misleading. Such
counsel may state further that such counsel assumes no
responsibility for, and has not independently verified, the
accuracy, completeness or fairness of the financial statements,
notes and schedules and other financial data included in any
Registration Statement contemplated by this Agreement or the
related Prospectus; and
(3) a customary comfort letter, dated as of the date of
Consummation of the Exchange Offer or the date of effectiveness
of the Shelf Registration Statement, as the case may be, from
the Company's independent accountants, in the customary form and
covering matters of the type customarily covered in comfort
letters by underwriters in connection with primary underwritten
offerings, and affirming the matters set forth in the comfort
letters delivered pursuant to Section 7 of the Purchase
Agreement, without exception;
(B) set forth in full or incorporated by reference in the
underwriting agreement, if any, the indemnification provisions and
procedures of Section 8 hereof with respect to all parties to be
indemnified pursuant to said Section; and
(C) deliver such other documents and certificates as may be
reasonably requested by such parties to evidence compliance with
clause (A) above and with any customary conditions contained in the
underwriting agreement or other agreement entered into by the Company
and the Guarantors pursuant to this clause (x), if any.
(k) prior to any public offering of Transfer Restricted Securities,
or Broker-Dealer Transfer Restricted Securities, as applicable, cooperate
with the selling Holders of Transfer Restricted Securities, the Holders of
Broker-Dealer Transfer Restricted Securities, the underwriter(s), if any,
and their respective counsel in connection with the registration and
qualification of the Transfer Restricted Securities or Broker-Dealer
Transfer Restricted Securities, as applicable, under the securities or
Blue Sky laws of such jurisdictions as the selling Holders of Transfer
Restricted Securities or Holders of Broker-Dealer Transfer Restricted
Securities or underwriter(s) may reasonably request and do any and all
other acts or things necessary or advisable to enable the disposition in
such jurisdictions of the Transfer Restricted Securities or Broker-Dealer
Transfer Restricted
-14-
Securities, as applicable, covered by the Shelf Registration Statement
filed pursuant to Section 4 hereof; provided, however, that the Company
and the Guarantors shall not be required to register or qualify as a
foreign corporation where it is not now so qualified or to take any action
that would subject it to the service of process in suits or to taxation,
other than as to matters and transactions relating to the Registration
Statement, in any jurisdiction where it is not now so subject;
(l) shall issue, upon the request of any Holder of Series A Notes
covered by the Shelf Registration Statement, Series B Notes, having an
aggregate principal amount equal to the aggregate principal amount of
Series A Notes surrendered to the Company by such Holder in exchange
therefor or being sold by such Holder; such Series B Notes to be
registered in the name of such Holder or in the name of the purchaser(s)
of such Notes, as the case may be; in return, the Series A Notes held by
such Holder shall be surrendered to the Company for cancellation;
(m) cooperate with the selling Holders of Transfer Restricted
Securities and the underwriter(s), if any, to facilitate the timely
preparation and delivery of certificates representing Transfer Restricted
Securities to be sold and not bearing any restrictive legends; and enable
such Transfer Restricted Securities to be in such denominations and
registered in such names as the Holders or the underwriter(s), if any, may
request at least two business days prior to any sale of Transfer
Restricted Securities made by such underwriter(s);
(n) use its best efforts to cause the Transfer Restricted Securities
or Broker-Dealer Transfer Restricted Securities, as applicable, covered by
the Registration Statement to be registered with or approved by such other
governmental agencies or authorities as may be necessary to enable the
seller or sellers thereof or the underwriter(s), if any, to consummate the
disposition of such Transfer Restricted Securities, subject to the proviso
contained in clause (xi) above;
(o) if any fact or event contemplated by clause (d)(iii)(D) above
shall exist or have occurred, prepare a supplement or post-effective
amendment to the Registration Statement or related Prospectus or any
document incorporated therein by reference or file any other required
document so that, as thereafter delivered to the purchasers of Transfer
Restricted Securities, or Broker-Dealer Transfer Restricted Securities, as
applicable, the Prospectus will not contain an untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein not misleading;
(p) provide a CUSIP number for all Transfer Restricted Securities not
later than the effective date of the Registration Statement and provide
the Trustee under the Indenture with printed certificates for the Transfer
Restricted Securities which are in a form eligible for deposit with the
Depository Trust Company;
(q) cooperate and assist in any filings required to be made with the
NASD and in the performance of any due diligence investigation by any
underwriter (including any "qualified independent underwriter") that is
required to be retained in accordance with the rules and regulations of
the NASD;
-15-
(r) otherwise use their best efforts to comply with all applicable
rules and regulations of the Commission, and make generally available to
its security holders, as soon as practicable, a consolidated earnings
statement meeting the requirements of Rule 158 (which need not be audited)
for the twelve-month period (A) commencing at the end of any fiscal
quarter in which Transfer Restricted Securities are sold to underwriters
in a firm or best efforts Underwritten Offering or (B) if not sold to
underwriters in such an offering, beginning with the first month of the
Company's first fiscal quarter commencing after the effective date of the
Registration Statement;
(s) cause the Indenture to be qualified under the TIA not later than
the effective date of the first Registration Statement required by this
Agreement, and, in connection therewith, cooperate with the Trustee and
the Holders of Notes to effect such changes to the Indenture as may be
required for such Indenture to be so qualified in accordance with the
terms of the TIA; and execute, and use all commercially reasonable efforts
to cause the Trustee to execute, all documents that may be required to
effect such changes and all other forms and documents required to be filed
with the Commission to enable such Indenture to be so qualified in a
timely manner;
(t) provide promptly to each Holder upon request each document filed
with the Commission pursuant to the requirements of Section 13 and Section
15 of the Exchange Act; and
(u) cause each Additional Guarantor upon the creation or acquisition
by the Company of such Additional Guarantor, to execute a counterpart to
this Agreement in the form attached hereto as Annex A and to deliver such
counterpart, together with an opinion of counsel as to the enforceability
thereof against such entity, to the Initial Purchasers no later than five
business days following the execution thereof.
Each Holder agrees by acquisition of a Transfer Restricted Security
or Broker-Dealer Transfer Restricted Securities, as applicable, that, upon
receipt of any notice from the Company of the existence of any fact of the kind
described in Section 6(d)(iii)(D) hereof, such Holder will forthwith
discontinue disposition of Transfer Restricted Securities or Broker-Dealer
Transfer Restricted Security pursuant to the applicable Registration Statement
until such Holder's receipt of the copies of the supplemented or amended
Prospectus contemplated by Section 6(d)(xvi) hereof, or until it is advised in
writing (the "Advice") by the Company that the use of the Prospectus may be
resumed, and has received copies of any additional or supplemental filings that
are incorporated by reference in the Prospectus. If so directed by the Company,
each Holder will deliver to the Company (at the Company's expense) all copies,
other than permanent file copies then in such Holder's possession, of the
Prospectus covering such Transfer Restricted Securities or Broker-Dealer
Transfer Restricted Security, as applicable, that was current at the time of
receipt of such notice. In the event the Company shall give any such notice,
the time period regarding the effectiveness of such Registration Statement set
forth in Section 3 or 4 hereof, as applicable, shall be extended by the number
of days during the period from and including the date of the giving of such
notice pursuant to Section 6(d)(iii)(D) hereof to and including the date when
each selling Holder covered by such Registration Statement shall have received
the copies of the supplemented or amended Prospectus contemplated by Section
6(d)(xv) hereof or shall have received the Advice.
The Company and the Guarantors may require each Holder of Transfer
Restricted Securities or Broker-Dealer Transfer Restricted Securities as to
which any registration is being
-16-
effected to furnish to the Company such information regarding such Holder and
such Holder's intended method of distribution of the applicable Transfer
Restricted Securities or Broker-Dealer Transfer Restricted Securities as the
Company may from time to time reasonably request in writing, but only to the
extent that such information is required in order to comply with the Act. Each
such Holder agrees to notify the Company as promptly as practicable of (i) any
inaccuracy or change in information previously furnished by such Holder to the
Company or (ii) the occurrence of any event, in either case, as a result of
which any Prospectus relating to such registration contains or would contain an
untrue statement of a material fact regarding such Holder or such Holder's
intended method of distribution of the applicable Transfer Restricted
Securities or Broker-Dealer Transfer Restricted Securities or omits to state
any material fact regarding such Holder or such Holder's intended method of
distribution of the applicable Transfer Restricted Securities or Broker-Dealer
Transfer Restricted Securities required to be stated therein or necessary to
make the statements therein not misleading and promptly to furnish to the
Company any additional information required to correct and update any
previously furnish to the Company any additional information required to
correct and update any previously furnished information or required so that
such Prospectus shall not contain, with respect to such Holder or the
distribution of the applicable Transfer Restricted Securities or Broker-Dealer
Transfer Restricted Securities 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.
SECTION 7. REGISTRATION EXPENSES
All expenses incident to the Company's and the Guarantors' performance
of or compliance with this Agreement will be borne by the Company regardless of
whether a Registration Statement becomes effective, including without
limitation: (i) all registration and filing fees and expenses (including
filings made by any Initial Purchaser or Holder with the NASD (and, if
applicable, the fees and expenses of any "qualified independent underwriter"
and its counsel that may be required by the rules and regulations of the
NASD)); (ii) all fees and expenses of compliance with federal securities and
state Blue Sky or securities laws; (iii) all expenses of printing (including
printing certificates for the Series B Notes to be issued in the Exchange Offer
and printing of Prospectuses), messenger and delivery services; (iv) all fees
and disbursements of counsel for the Company and the Guarantors and the Holders
of Transfer Restricted Securities; and (v) all fees and disbursements of
independent certified public accountants of the Company (including the expenses
of any special audit and comfort letters required by or incident to such
performance).
The Company will, in any event, bear its and the Guarantors' internal
expenses (including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties), the expenses of
any annual audit and the fees and expenses of any Person, including special
experts, retained by the Company or the Guarantors.
-17-
SECTION 8. INDEMNIFICATION
8.1 The Company and the Guarantors shall, jointly and severally,
indemnify and hold harmless each Holder of Transfer Restricted Securities or
Broker Dealer Transfer Restricted Securities, its officers and employees and
each person, if any, who controls any such Holders, within the meaning of the
Securities Act, from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof (including, but not limited to, any
loss, claim, damage, liability or action relating to purchases, sales and
registration of Notes), to which that Holder, officer, employee or controlling
person 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 (A) in any Registration Statement or Prospectus or in any amendment
or supplement thereto or (B) in any blue sky application or other document
prepared or executed by the Company or any Guarantor (or based upon any written
information furnished by the Company or any Guarantor) specifically for the
purpose of qualifying any or all of the Notes under the securities laws of any
state or other jurisdiction (any such application, document or information
being hereinafter called a "Blue Sky Application"), (ii) the omission or
alleged omission to state in any Registration Statement or Prospectus, or in
any amendment or supplement thereto, or in any Blue Sky Application any
material fact required to be stated therein or necessary to make the statements
therein not misleading or (iii) any act or failure to act or any alleged act or
failure to act by any Holder in connection with, or relating in any manner to,
the Notes or the offering contemplated hereby, and which is included as part of
or referred to in any loss, claim, damage, liability or action arising out of
or based upon matters covered by clause (i) or (ii) above (provided that the
Company and the Guarantors shall not be liable under this clause (iii) to the
extent that it is determined in a final judgment by a court of competent
jurisdiction that such loss, claim, damage, liability or action resulted
directly from any such acts or failures to act undertaken or omitted to be
taken by such Holder through its gross negligence or willful misconduct), and
shall reimburse each Holder and each such officer, employee or controlling
person promptly upon demand for any legal or other expenses reasonably incurred
by that Holder, officer, employee or controlling person in connection with
investigating or defending or preparing to defend against any such loss, claim,
damage, liability or action as such expenses are incurred; 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, any untrue statement or alleged untrue statement or omission or
alleged omission made in any Registration Statement or Prospectus, or in any
such amendment or supplement, or in any Blue Sky Application, in reliance upon
and in conformity with written information concerning such Holder furnished to
the Company by or on behalf of any Holder specifically for inclusion therein.
The foregoing indemnity agreement is in addition to any liability which the
Company and the Guarantors may otherwise have to any Holder or to any officer,
employee or controlling person of that Holder.
8.2 Each Holder, severally and not jointly, shall indemnify and hold
harmless the Company and the Guarantors, their respective officers and
employees, each of their respective directors, and each person, if any, who
controls the Company or the Guarantors within the meaning of the Securities
Act, from and against any loss, claim, damage or liability, joint or several,
or any action in respect thereof, to which the Company, the Guarantors or any
such director, officer or controlling person 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 (A) in any Registration Statement
or Prospectus, or in any amendment or supplement thereto, or (B) in any Blue
Sky Application or (ii) the omission or
-18-
alleged omission to state in any Registration Statement or Prospectus, or in
any amendment or supplement thereto, or in any Blue Sky Application any
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 written information concerning such
Holders furnished to the Company by or on behalf of that Holder specifically
for inclusion therein, and shall reimburse the Company, the Guarantors and any
such director, officer or controlling person for any legal or other expenses
reasonably incurred by the Company, the Guarantors or any such director,
officer or controlling person in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or action
as such expenses are incurred. The foregoing indemnity agreement is in addition
to any liability which any Holder may otherwise have to the Company, the
Guarantors or any such director, officer, employee or controlling person.
8.3 Promptly after receipt by an indemnified party under this Section
8 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 8, 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 8 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 8. 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 8 for any legal
or other expenses subsequently incurred by the indemnified party in connection
with the defense thereof other than reasonable costs of investigation;
provided, however, 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 the
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 (iii) 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
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 (in addition to one local
counsel) at any time for all such indemnified parties, if the indemnified
parties under this Section 8 consist of any Initial Purchaser or any of their
respective officers, employees or controlling persons, or by the Company, if
the indemnified parties under this Section consist of the Company, the
Guarantors or any of their respective directors, officers, employees or
controlling persons. No indemnifying party shall (i) without the prior written
consent
-19-
of the indemnified parties (which consent shall not be unreasonably withheld),
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, or (ii) 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 the consent of the indemnifying party or if
there be a final judgment of 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.
8.4 If the indemnification provided for in this Section 8 shall for
any reason be unavailable to or insufficient to hold harmless an indemnified
party under Section 8(a) or 8(b) in respect of any loss, claim, damage or
liability, or any action in respect thereof, referred to therein, 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 the Holders on
the other, from the offering of the Notes 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 the Holders 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 the
Holders 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 Series A
Notes purchased under the Purchase Agreement (before deducting expenses)
received by the Company and the Guarantors, on the one hand, and the total
discounts and commissions received by the Holders with respect to the Series A
Notes purchased under this Agreement, on the other hand, bear to the total
gross proceeds from the offering of the Series A Notes under the Purchase
Agreement, in each case as set forth in the table on the cover page of the
Offering Memorandum. The relative fault shall be determined by reference to
whether the untrue or alleged untrue statement of a material fact or omission
or alleged omission to state a material fact relates to information supplied by
the Company, the Guarantors or the Holders, the intent of the parties and their
relative knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company, the Guarantors and the Holders agree
that it would not be just and equitable if contributions pursuant to this
Section 8(d) 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 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 shall be deemed to include, for purposes of
this Section 8(d), 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 8(d), no Holder shall
be required to contribute any amount in excess of the amount by which the net
proceeds received by it in connection with its sale of Notes 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
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guilty of such fraudulent misrepresentation. The Holders' obligations to
contribute as provided in this Section 8(d) are several and not joint.
SECTION 9. RULE 144A
The Company and each Guarantor hereby agrees with each Holder of
Transfer Restricted Securities, during any period in which the Company or such
Guarantor is not subject to Section 13 or 15(d) of the Exchange Act within the
two-year period following the Closing Date, and each Holder of Broker-Dealer
Transfer Restricted Securities, for so long as any Broker-Dealer Transfer
Restricted Securities remain outstanding, to make available to any Holder or
beneficial owner of Transfer Restricted Securities or any Holder or
Broker-Dealer 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.
SECTION 10. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS
No Holder may participate in any Underwritten Registration hereunder
unless such Holder (a) agrees to sell such Holder's Transfer Restricted
Securities or Broker-Dealer Transfer Restricted Securities, as applicable, on
the basis provided in any underwriting arrangements approved by the Persons
entitled hereunder to approve such arrangements and (b) completes and executes
all reasonable questionnaires, powers of attorney, indemnities, underwriting
agreements, lock-up letters and other documents required under the terms of
such underwriting arrangements.
SECTION 11. SELECTION OF UNDERWRITERS
The Holders of Transfer Restricted Securities covered by the Shelf
Registration Statement who desire to do so may sell such Transfer Restricted
Securities in an Underwritten Offering at such Holders' expense. In any such
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 the Transfer Restricted
Securities included in such offering; provided, that such investment bankers
and managers must be reasonably satisfactory to the Company.
SECTION 12. MISCELLANEOUS
12.1 Remedies. The Company and the Guarantors agree that monetary
damages (including the liquidated damages contemplated hereby) would not be
adequate compensation for any loss incurred by reason of a breach by it of the
provisions of this Agreement and hereby agree to waive the defense in any
action for specific performance that a remedy at law would be adequate.
12.2 No Inconsistent Agreements. Neither the Company nor any Guarantor
will, on or after the date of this Agreement, enter into any agreement with
respect to its securities that is inconsistent with the rights granted to the
Holders in this Agreement or otherwise conflicts with the
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provisions hereof. Except as disclosed in the Final Offering Memorandum,
neither the Company nor any Guarantor has previously entered into any agreement
granting any registration rights with respect to its securities to any Person.
The rights granted to the Holders hereunder do not in any way conflict with and
are not inconsistent with the rights granted to the holders of the Company's or
any Guarantor's securities under any agreement in effect on the date hereof.
12.3 Adjustments Affecting the Notes. The Company and the Guarantors
will not take any action, or permit any change to occur, with respect to the
Notes that would materially and adversely affect the ability of the Holders to
Consummate any Exchange Offer.
12.4 Amendments and Waivers. The provisions of this Agreement may not
be amended, modified or supplemented, and waivers or consents to or departures
from the provisions hereof may not be given unless the Company has obtained the
written consent of Holders of a majority of the outstanding principal amount of
Transfer Restricted Securities. Notwithstanding the foregoing, a waiver or
consent to departure from the provisions hereof that relates exclusively to the
rights of Holders whose securities are being tendered pursuant to the Exchange
Offer and that does not affect directly or indirectly the rights of other
Holders whose securities are not being tendered pursuant to such Exchange Offer
may be given by the Holders of a majority of the outstanding principal amount
of Transfer Restricted Securities being tendered or registered.
12.5 Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail
(registered or certified, return receipt requested), telex, telecopier, or air
courier guaranteeing overnight delivery:
(a) if to a Holder, at the address set forth on the records of the
Registrar under the Indenture, with a copy to the Registrar under the
Indenture; and
(b) if to the Company or the Guarantors:
L-3 Communications Corporation
000 Xxxxx Xxxxxx, 00xx Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxxxxxxxxx X. Xxxxxxx (Fax: 000-000-0000),
With a copy to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX, 00000
Attention: Xxxxxxx Xxxxxx Xx. (Fax: 000-000-0000)
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five business
days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if telexed; when receipt acknowledged, if telecopied; and on the
next business day, if timely delivered to an air courier guaranteeing overnight
delivery.
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address specified in the Indenture.
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12.6 Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the successors and assigns of each of the parties,
including without limitation and without the need for an express assignment,
subsequent Holders or Restricted Broker Dealers; 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 or Broker Dealer Transfer Restricted Securities
from such Holder.
12.7 Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
12.8 Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
12.9 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE
CONFLICT OF LAW RULES THEREOF.
12.10 Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be affected or impaired
thereby.
12.11 Entire Agreement. This Agreement together with the other
Operative Documents (as defined in the Purchase Agreement) is intended by the
parties as a final expression of their agreement and intended to be a complete
and exclusive statement of the agreement and understanding of the parties
hereto in respect of the subject matter contained herein. There are no
restrictions, promises, warranties or undertakings, other than those set forth
or referred to herein with respect to the registration rights granted by the
Company and the Guarantors with respect to the Transfer Restricted Securities.
This Agreement supersedes all prior agreements and understandings between the
parties with respect to such subject matter.
[Signature pages follow]
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IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
L-3 COMMUNICATIONS CORPORATION
By:
-----------------------------
Name:
Title:
GUARANTORS:
HYGIENETICS ENVIRONMENTAL SERVICES, INC.
By:
-----------------------------
Name:
Title:
X-0 XXXXXXXXXXXXXX XXXX SYSTEMS, INC.
By:
-----------------------------
Name:
Title:
SOUTHERN CALIFORNIA MICROWAVE, INC.
By:
-----------------------------
Name:
Title:
L-3 COMMUNICATIONS SPD TECHNOLOGIES, INC.
By:
-----------------------------
Name:
Title:
X-0
X-0 XXXXXXXXXXXXXX XXXXX, INC.
By:
-----------------------------
Name:
Title:
STORM CONTROL SYSTEMS, INC.
By:
-----------------------------
Name:
Title:
DBS MICROWAVE, INC.
By:
-----------------------------
Name:
Title:
SPD ELECTRICAL SYSTEMS, INC.
By:
-----------------------------
Name:
Title:
SPD SWITCHGEAR INC.
By:
-----------------------------
Name:
Title:
PAC ORD INC.
By:
-----------------------------
Name:
Title:
XXXXXXXX INC.
By:
-----------------------------
Name:
Title:
S-2
SPD HOLDINGS, INC.
By:
-----------------------------
Name:
Title:
POWER PARAGON, INC.
By:
-----------------------------
Name:
Title:
XXXXXX BROTHERS INC.
NATIONSBANC XXXXXXXXXX SECURITES LLC
BY XXXXXX BROTHERS INC.
By:
---------------------------------------
Authorized Representative
ANNEX A
COUNTERPART TO REGISTRATION RIGHTS AGREEMENT
The undersigned hereby absolutely, unconditionally and irrevocably
agrees (as a "Guarantor") to make all commercially reasonable efforts to
include its Subsidiary Guarantee in any Registration Statement required to be
filed by the Company and the Guarantors pursuant to the Registration Rights
Agreement, dated as of December 11, 1998, (the "Registration Rights Agreement")
by and among L-3 Communications Corporation, a Delaware corporation, the
guarantors named therein, Xxxxxx Brothers Inc. and NationsBanc Xxxxxxxxxx
Securities LLC; to make all commercially reasonable efforts to cause such
Registration Statement to become effective as specified in the Registration
Rights Agreement; and to otherwise be bound by the terms and provisions of the
Registration Rights Agreement.
IN WITNESS WHEREOF, the undersigned has executed this Counterpart as
of , 1998.
[NAME]
By:
-----------------------------
Name:
Title:
A-1
