Exhibit 4.2
EXECUTION COPY
XXXX XX INDUSTRIES, INC.
$275,000,000 of
4 3/4% Convertible Subordinated Notes due 2004
Registration Rights Agreement
October 29, 1997
BEAR, XXXXXXX & CO. INC.
This Registration Rights Agreement (this "AGREEMENT") is made
and entered into as of October 29, 1997 by and between Xxxx XX Industries, Inc.,
a Delaware corporation (the "Company"), and Bear, Xxxxxxx & Co. Inc. (the
"INITIAL PURCHASER"). This Agreement is made pursuant to the Purchase Agreement,
dated October 23, 1997 (the "PURCHASE AGREEMENT"), by and between the Company
and the Initial Purchaser, pursuant to which the Company proposes to issue and
sell to the Initial Purchaser $275,000,000 aggregate principal amount of its 4
3/4% Convertible Subordinate Note due 2004 (the "FIRM NOTES"). The Company also
proposes to issue and sell to the Initial Purchaser not more than an additional
$41,250,000 aggregate principal amount of its 4 3/4 Convertible Subordinated
Notes due 2004 (the "ADDITIONAL NOTES" and, together with the Firm Notes, the
"NOTES"), if requested by the Initial Purchaser as provided in Section 2 of the
Purchase Agreement. In order to induce the Initial Purchaser to purchase the
Notes, the Company has agreed to provide the registration rights set forth in
this Agreement. Capitalized terms used herein but not otherwise defined shall
have the meanings ascribed to them in the Purchase Agreement. The execution and
delivery of this Agreement is a condition to the obligations of the Initial
Purchaser set forth in Section 6 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.
BROKER-DEALER: Any broker or dealer registered under the Exchange Act.
COMMISSION: The Securities and Exchange Commission.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended.
HOLDERS: As defined in Section 2(b) hereof.
INDEMNIFIED HOLDER: As defined in Section 7(a) hereof.
INDENTURE: The Indenture, dated as of October 29, 1997, by and between
the Company 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 PURCHASER: As defined in the preamble hereto.
ISSUE DATE: The date of this Agreement.
LIQUIDATED DAMAGES: As defined in Section 4.
NASD: National Association of Securities Dealers, Inc.
PERSON: An individual, partnership, corporation, trust or unincorporated
organization, or a government or agency or political subdivision thereof.
PROSPECTUS: The prospectus included in any Shelf Registration Statement,
as amended or supplemented by any prospectus supplement and by all other
amendments thereto, including post-effective amendments, and all material
incorporated by reference into such Prospectus.
SHELF REGISTRATION STATEMENT: Any "shelf" Shelf Registration Statement
of the Company pursuant to the provisions of Section 3 hereof, relating to the
registration for resale of Transfer Restricted Securities on an appropriate form
under Rule 415 under the Act or any similar rule that may be adopted by the
Commission, including the Prospectus included therein, all amendments and
supplements thereto (including post-effective amendments) and all exhibits and
material incorporated by reference therein.
SHELF FILING DEADLINE: As defined in Section 3 hereof.
SUPPLEMENT DELAY PERIOD: As defined in Section 5(c) hereof.
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 and the Common Stock issuable
upon conversion thereof until the first to occur of (i) the date on which such
Note or the Common Stock issuable upon conversion thereof has been registered
under the Act and disposed of in accordance with the Shelf Registration
Statement or (ii) the date on which such Note or the Common Stock issuable upon
conversion thereof has been distributed to the public pursuant to Rule 144 under
the Act or (iii) October 29, 1999.
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
(a) TRANSFER RESTRICTED SECURITIES. The securities entitled to the
benefits of this Agreement are the Transfer Restricted Securities.
(b) HOLDERS OF TRANSFER RESTRICTED SECURITIES. A Person is deemed to be
a holder of Transfer Restricted Securities (each, a "HOLDER") whenever such
Person is the record owner of Transfer Restricted Securities.
SECTION 3. SHELF REGISTRATION
(a) SHELF REGISTRATION. The Company shall cause to be filed a Shelf
Registration Statement pursuant to Rule 415 under the Act, on or prior to the
90th calendar day after the Issue Date (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 3(b) hereof and thereafter shall use all reasonable
efforts to cause such Shelf Registration Statement to be declared effective by
the Commission on or before the 150th calendar day (plus any additional days
allowed as a result of a Supplemental Delay Period) after the Issue Deadline.
Subject to the commencement of any Supplemental Delay Period, the Company shall
use all reasonable efforts to keep effective the Shelf Registration Statement
until the earlier of two years after the Issue Date or such time as all of the
applicable Transfer Restricted Securities are no longer Transfer Restricted
Securities. The Company shall use all reasonable efforts to keep such Shelf
Registration Statement supplemented and amended as required by the provisions of
Sections 5(b)(i) and (ii) hereof to the extent necessary to ensure that it is
available for resales of the Transfer Restricted Securities by the Holders
entitled to the benefit of this Section 3(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 Issue Date or until such earlier date on which all
such Transfer Restricted Securities are no longer Transfer Restricted
Securities. Notwithstanding anything to the contrary herein, the Company shall
not be required to file more than one Shelf Registration Statement hereunder.
(b) PROVISION BY HOLDERS OF CERTAIN INFORMATION IN CONNECTION WITH THE
SHELF REGISTRATION STATEMENT. No Holder of Transfer Restricted Securities may
include any of its Transfer Restricted Securities in any Shelf Registration
Statement pursuant to this Agreement unless and until such Holder furnishes to
the Company in writing, within 20 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 4 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.
SECTION 4. LIQUIDATED DAMAGES
If (i) the Shelf Registration Statement is not filed with the Commission
on or prior to the 90th calendar day after Issue Date, then commencing on the
day after such date, liquidated damages, (the "LIQUIDATED DAMAGES") shall be
payable on the principal amount of the Notes at a rate of 0.25% per annum; or
(ii) the Shelf Registration Statement is not declared effective by the
Commission on or prior to the 150th calendar day after the Issue Date then,
commencing on the 151st calendar day after the Issue Date, Liquidated Damages
shall be payable on the principal amount of the Notes at a rate of 0.25% per
annum; or
(iii) the Shelf Registration Statement has been declared effective by
the Commission and such Shelf Registration Statement ceases to be effective
(without being succeeded on the same day by a post-effective amendment to such
Shelf Registration Statement that cures such failure and that is immediately
declared effective) or use of the Prospectus is suspended during the
registration period for a time that exceeds 60 days in the aggregate during any
360 day period, then Liquidated Damages shall be payable on the principal amount
of the Notes at a rate of 0.25% per annum from and including the day following
such 60th day;
PROVIDED, HOWEVER, that the Liquidated Damages on the Notes may not exceed in
the aggregate 0.25% per annum; PROVIDED FURTHER, HOWEVER, that (1) upon the
filing of the Shelf Registration Statement (in the case of clause (i) above),
(2) upon the effectiveness of the Shelf Registration Statement (in the case of
clause (ii) above), or (3) upon the effectiveness of the Shelf Registration
Statement which had ceased to remain effective or upon the termination of the
suspension of the Prospectus, as applicable (in the case of clause (iii) above),
Liquidated Damages on the Notes as a result of such clause, as the case may be,
shall cease to accumulate.
Any amounts of Liquidated Damages due pursuant to clause (i), (ii) or (iii)
above will be payable in cash on May 1 and November 1 of each year to the
holders of record on the preceding April 15 or September 15, respectively.
SECTION 5. REGISTRATION PROCEDURES
(a) In connection with the Shelf Registration Statement, the Company
shall comply with all the provisions of Section 5(b) below and shall use its
best efforts to effect such registration to permit the sale of the Transfer
Restricted Securities being sold in accordance with the intended method or
methods of distribution thereof, and pursuant thereto the Company will, in
accordance with Section 3(a), prepare and file with the Commission a Shelf
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.
(b) GENERAL PROVISIONS. In connection with any Shelf Registration
Statement and any Prospectus required by this Agreement to permit the sale or
resale of Transfer Restricted Securities the Company shall:
(i) use all reasonable efforts to keep such Shelf
Registration Statement continuously effective and provide all
requisite financial statements (including, if required by the Act
or any regulation thereunder, financial statements of its
subsidiaries) for the period specified in Section 3 of this
Agreement; and upon the occurrence of any event that would cause
any such Shelf Registration Statement or the Prospectus contained
therein (A) to contain a material misstatement or omission or (B)
not to be effective and usable for resale of Transfer Restricted
Securities during the period required by this Agreement, the
Company shall file promptly an appropriate amendment to such
Shelf 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 reasonable efforts to cause
such amendment to be declared effective and such Shelf
Registration Statement and the related Prospectus to become
usable for their intended purpose(s) as soon as practicable
thereafter;
(ii) prepare and file with the Commission such
amendments and post-effective amendments to the Shelf
Registration Statement as may be necessary to keep the Shelf
Registration Statement effective for the applicable period set
forth in Section 3 hereof, or such shorter period as when all
Transfer Restricted Securities covered by such Shelf Registration
Statement are no longer Transfer Restricted Securities; 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 Shelf
Registration Statement during the applicable period in accordance
with the intended method or methods of distribution by the
sellers thereof set forth in such Shelf Registration Statement or
supplement to the Prospectus;
(iii) advise the underwriter(s), if any, and
selling Holders 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 Shelf Registration Statement or any
post-effective amendment thereto, when the same has become
effective, (B) of any request by the Commission for amendments to
the Shelf Registration Statement or amendments or supplements to
the Prospectus or for additional information relating thereto,
(C) of the issuance by the Commission of any stop order
suspending the effectiveness of the Shelf Registration Statement
under the Act or of the suspension by any state securities
commission of the qualification of the Transfer Restricted
Securities for offering or sale in any jurisdiction, or the
initiation of any proceeding for any of the preceding purposes,
(D) of the existence of any fact or the happening of any event
that makes any statement of a material fact made in the
Registration Statement, the Prospectus, any amendment or
supplement thereto, or any document incorporated by reference
therein untrue, or that requires the making of any additions to
or changes in the Shelf Registration Statement or the Prospectus
in order to make the statements therein not misleading. If at any
time the Commission shall issue any stop order suspending the
effectiveness of the Registration Statement, or any state
securities commission or other regulatory authority shall issue
an order suspending the qualification or exemption from
qualification of the Transfer Restricted Securities under state
securities or Blue Sky laws, the Company shall use its best
efforts to obtain the withdrawal or lifting of such order at the
earliest possible time;
(iv) furnish to each of the selling Holders and
each of the underwriter(s), if any, before filing with the
Commission, copies of any Shelf Registration Statement or any
Prospectus included therein or any amendments or supplements to
any such Shelf Registration Statement or Prospectus (including
all documents incorporated by reference in 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 will not file any such Shelf
Registration Statement or Prospectus or any amendment or
supplement to any such Shelf Registration Statement or Prospectus
(including all such documents incorporated by reference) to which
a selling Holder of Transfer Restricted Securities covered by
such Shelf Registration Statement or the underwriter(s), if any,
shall reasonably object within five business days after the
receipt thereof. A selling Holder or underwriter, if any, shall
be deemed to have reasonably objected to such filing if such
Registration Statement, amendment, Prospectus or supplement, as
applicable, as proposed to be filed, contains a material
misstatement or omission;
(v) concurrently with the filing of any document
that is to be incorporated by reference into a Shelf Registration
Statement or Prospectus, provide copies of such document to the
selling Holders and to the underwriter(s), if any, make the
Company's representatives available for discussion of such
document and other customary due diligence matters, and include
such information in such document as such selling Holders or
underwriter(s), if any, reasonably may request;
(vi) upon request and during regular business
hours, make available at reasonable times for inspection by any
Holder who purchases Transfer Restricted Securities from the
Initial Purchaser in its original offering or any transferee of
Transfer Restricted Securities who beneficially owns not less
than $2 million in aggregate principal amount 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), all material financial and other records,
pertinent corporate documents and properties of the Company and
cause the Company's officers, directors and employees to supply
all information reasonably requested by any such Holder,
underwriter, attorney or accountant in connection with such Shelf
Registration Statement subsequent to the filing thereof and prior
to its effectiveness;
(vii) if requested by any selling Holders or the
underwriter(s), if any, promptly incorporate in any Shelf
Registration Statement or Prospectus, pursuant to a supplement or
post-effective amendment if necessary, such information as such
selling Holders and underwriter(s), if any, may reasonably
request to have included therein, including, without limitation,
information relating to the "Plan of Distribution" of the
Transfer Restricted Securities, information with respect to the
principal amount of Transfer Restricted Securities being sold to
such underwriter(s), the purchase price being paid therefor and
any other terms of the offering of the Transfer Restricted
Securities; 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;
(viii) cause the Notes covered by the Shelf
Registration Statement to be rated with the appropriate rating
agencies, if so requested by the Holders of a majority in
aggregate principal amount of Notes covered thereby or the
underwriter(s), if any;
(ix) furnish to each selling Holder 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);
(x) deliver to each selling Holder and each of the
underwriter(s), if any, without charge, as many copies of the
Prospectus (including each preliminary prospectus) and any
amendment or supplement thereto as such Persons reasonably may
request; the Company hereby consents to the use of the Prospectus
and any amendment or supplement thereto by each of the selling
Holders and each of the underwriter(s), if any, in connection
with the offering and the sale of the Transfer Restricted
Securities covered by the Prospectus or any amendment or
supplement thereto;
(xi) enter into such customary agreements
(including an underwriting agreement), and make such
representations and warranties, and take all such other actions
in connection therewith in order to expedite or facilitate the
disposition of the Transfer Restricted Securities pursuant to any
Shelf Registration Statement contemplated by this Agreement, all
to such extent as may be reasonably requested by the Initial
Purchaser or by any Holder of Transfer Restricted Securities or
underwriter in connection with any sale or resale pursuant to any
Shelf Registration Statement contemplated by this Agreement; and
whether or not an underwriting agreement is entered into and
whether or not the registration is an Underwritten Registration,
the Company shall:
(A) furnish to the Initial Purchaser, each selling
Holder and each underwriter, if any, in such substance and
scope as they may request and as are customarily made by
issuers to underwriters in primary underwritten offerings,
upon the effectiveness of the Shelf Registration Statement:
(1) a certificate, dated the date of
effectiveness of the Shelf Registration Statement,
signed by the Chairman or the President and a Vice
President of the Company, dated the date of its
delivery, to the effect that the conditions set forth
in subsection (c) of Section 6 of the Purchase
Agreement have been satisfied, that the
representations and warranties of the Company set
forth in Section 1 of the Purchase Agreement are
accurate and certifying as to such other matters as
such parties may reasonably request;
(2) an opinion, dated the date of
effectiveness of the Shelf Registration Statement, of
Counsel and Special Counsel for the Company covering
the matters set forth in paragraph (a) of Section 6
of the Purchase Agreement and such other matters as
such parties may reasonably request; and
(3) a customary comfort letter, dated as of
the date of effectiveness of the Shelf Registration
Statement, 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 6(d) of the Purchase Agreement, without
exception;
(B) set forth in full or incorporate by reference in
the underwriting agreement, if any, the indemnification
provisions and procedures of Section 7 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 pursuant to this clause
(xi), if any.
If at any time the representations and warranties of the
Company contemplated in clause (A)(1) above cease to be true and
correct, the Company shall so advise the Initial Purchaser and the
underwriter(s), if any, and each selling Holder promptly and, if
requested by such Persons, shall confirm such advice in writing;
(xii) prior to any public offering of Transfer
Restricted Securities, cooperate with the selling Holders, the
underwriter(s), if any, and their respective counsel in
connection with the registration and qualification of the
Transfer Restricted Securities under the securities or Blue Sky
laws of such jurisdictions as the selling Holders or
underwriter(s) may request and do any and all other acts or
things necessary or advisable to enable the disposition in such
jurisdictions of the Transfer Restricted Securities covered by
the Shelf Registration Statement; PROVIDED, HOWEVER, that the
Company shall not be required 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;
(xiii) cooperate with the selling Holders 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 consummation of any sale of Transfer Restricted
Securities made by such underwriter(s);
(xiv) use its best efforts to cause the Transfer
Restricted Securities covered by the Shelf Registration Statement
to be registered with or approved by such other 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 (xii) above;
(xv) if any fact or event contemplated by clause
(b)(iii)(D) above shall exist or have occurred, prepare a
supplement or post-effective amendment to the Shelf Registration
Statement or related Prospectus or any document incorporated
therein by reference or file any other required document so that,
as thereafter delivered to the purchasers of Transfer Restricted
Securities, the Prospectus will not contain an untrue statement
of a material fact or omit to state any material fact necessary
to make the statements therein not misleading;
(xvi) provide a CUSIP number for all Transfer
Restricted Securities not later than the effective date of the
Shelf 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;
(xvii) cooperate and assist in any filings
required to be made with the NASD and in the performance of any
due diligence investigation by any underwriter (including any
"qualified independent underwriter") that is required to be
retained in accordance with the rules and regulations of the
NASD, and use its reasonable best efforts to cause such Shelf
Registration Statement to become effective and approved by such
governmental agencies or authorities as may be necessary to
enable the Holders selling Transfer Restricted Securities to
consummate the disposition of such Transfer Restricted
Securities;
(xviii) otherwise use its best efforts to comply
with all applicable rules and regulations of the Commission, and
make generally available to its security holders, 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;
(xix) cause the Indenture to be qualified under
the TIA not later than the effective date of the Shelf
Registration Statement required by this Agreement, and, in
connection therewith, cooperate with the Trustee and the Holders
of 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 its best 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;
(xx) cause all Common Stock covered by the Shelf
Registration Statement to be listed on each securities exchange
on which similar securities issued by the Company are then listed
if requested by the Holders of a majority in aggregate principal
amount of Notes or the managing underwriter(s), if any; and
(xxi) 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.
(c) Each Holder agrees by acquisition of a Transfer
Restricted Security that such Holder will forthwith discontinue disposition of
Transfer Restricted Securities pursuant to the Shelf Registration Statement upon
receipt of any notice from the Company of the existence of any fact of the kind
described in subsection (b)(iii)(D) of this Section 5, or if in the good faith
judgment of the Board of Directors of the Company, such disposition would
adversely affect a material proposed or pending acquisition, merger, financing
or other similar corporate event to which the Company is or expects to be a
party, in each case, until such Holder's receipt of the copies of the
supplemented or amended Prospectus contemplated by subsection (b)(xv) of this
Section 5, 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 (the "Supplemental Delay Period"). If so directed by the Company,
each Holder will deliver to the Company (at the Company's expense) all copies,
other than permanent file copies then in such Holder's possession, of the
Prospectus covering such Transfer Restricted Securities that was current at the
time of receipt of such notice. In the event the Company shall give any such
notice, the time period regarding the effectiveness of such Shelf Registration
Statement set forth in Section 3 hereof, shall be extended by the number of days
during the period from and including the date of the giving of such notice to
and including the date when each selling Holder covered by such Shelf
Registration Statement shall have received the copies of the supplemented or
amended Prospectus contemplated by subsection (b)(xv) of this Section 5 or shall
have received the Advice.
(d) Each Holder of Transfer Restricted Securities shall
maintain the confidentiality of any confidential information received from or
otherwise made available by the Company to such Holder of Transfer Restricted
Securities and identified in writing by the Company as confidential. Information
that (i) is or becomes available to a Holder of Transfer Restricted Securities
from a public source, (ii) is disclosed to a Holder of Transfer Restricted
Securities by a third-party source who the Holder of Transfer Restricted
Securities reasonably believes has the right to disclose such information or
(iii) is or becomes required to be disclosed by a Holder of Transfer Restricted
Securities by law, including by court order, shall not be deemed to be
confidential information for purposes of this Agreement. The Holders of Transfer
Restricted Securities shall not grant access, and the Company shall not be
required to grant access, to information under this Section 5(d) to any Person
who will not agree in writing to maintain the confidentiality (to the same
extent a Holder is required to maintain confidentiality) of any confidential
information received from or otherwise made available to it by the Company or
the Holders of Transfer Restricted Securities under this Agreement and
identified in writing by the Company as confidential.
SECTION 6. REGISTRATION EXPENSES
(a) All expenses incident to the Company's performance of or
compliance with this Agreement will be borne by the Company regardless of
whether the Shelf 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, the Shelf Registration
Statement; (iv) all fees and disbursements of Counsel for the Company and
subject to Section 6(b) below, the Holders of Transfer Restricted Securities;
(v) all application and filing fees in connection with listing of the Common
Stock issuable upon conversion of the Notes on a national securities exchange or
an automated quotation system pursuant to the requirements hereof; and (vi) 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 bear its internal expenses (including,
without limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), the expenses of any annual audit and the
fees and expenses of any Person, including special experts, retained by the
Company.
(b) In connection with any Shelf Registration Statement
required by this Agreement, the Company will reimburse the Initial Purchaser and
the Holders of Transfer Restricted Securities being registered pursuant to the
Shelf Registration Statement, for the reasonable fees and disbursements of not
more than one counsel, who shall be Xxxxxx & Xxxxxxx or such other counsel as
may be chosen by the Holders of a majority in principal amount of the Transfer
Restricted Securities for whose benefit such Shelf Registration Statement is
being prepared.
SECTION 7. INDEMNIFICATION
(a) The Company agrees to indemnify and hold harmless each
Holder and each person, if any, who controls any Holder within the meaning of
Section 15 of the Act or Section 20(a) of the Exchange Act (each an "INDEMNIFIED
HOLDER") against any and all losses, liabilities, claims, damages and expenses
whatsoever as incurred (including but not limited to attorneys' fees and any and
all expenses whatsoever incurred in investigating, preparing or defending
against any litigation, commenced or threatened, or any claim whatsoever, and
any and all amounts paid in settlement of any claim or litigation), joint or
several, to which they or any of them may become subject under the Act, the
Exchange Act or otherwise, insofar as such losses, liabilities, claims, damages
or expenses (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 any
Shelf Registration Statement or Prospectus, or in any supplement thereto or
amendment thereof, 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 light of the circumstances
under which they were made, not misleading; PROVIDED, HOWEVER, that the Company
will not be liable in any such case to the extent, but only to the extent, that
any such loss, liability, claim, damage or expense 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 Indemnified Holder
expressly for use therein; and PROVIDED, FURTHER, that the Company shall not be
liable to the Indemnified Holder (or any person controlling the Indemnified
Holder) under the indemnity agreement in this Section 7 with respect to any
Shelf Registration Statement or Prospectus, to the extent that any such loss,
liability, claim, damage or expense of the Indemnified Holder (or any person
controlling the Indemnified Holder) results from the fact such Indemnified
Holder sold Notes to a person to whom there was not sent or given, at or prior
to the written confirmation of such sale, a copy of the Shelf Registration
Statement (excluding documents incorporated by reference) or of the Prospectus
as then amended or supplemented (excluding documents incorporated by reference)
if the loss, liability, claim, damage or expense of the Indemnified Holder (or
such person controlling the Indemnified Holder) results from an untrue
statement, alleged untrue statement, omission or alleged omission of a material
fact contained in the preliminary prospectus, Prospectus or Shelf Registration
Statement that was corrected in the Prospectus or Shelf Registration Statement,
as amended or supplemented, and if the Company has previously furnished copies
thereof to the Indemnified Holder. This indemnity agreement will be in addition
to any liability which the Company may otherwise have, including without
limitation, under this Agreement.
(b) The Indemnified Holder agrees to indemnify and hold
harmless the Company, each director of the Company, each of the officers of the
Company, and each person, if any, who controls the Company within the meaning of
Section 15 of the Act or Section 20(a) of the Exchange Act, against any losses,
liabilities, claims, damages and expenses whatsoever as incurred (including but
not limited to attorneys' fees and any and all expenses whatsoever incurred in
investigating, preparing or defending against any litigation, commenced or
threatened, or any claim whatsoever, and any and all amounts paid in settlement
of any claim or litigation), joint or several, to which they or any of them may
become subject under the Act, the Exchange Act or otherwise, insofar as such
losses, liabilities, claims, damages or expenses (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 any Shelf Registration Statement or Prospectus,
or in any amendment thereof or supplement thereto, or arise out of or are based
upon the omission or alleged omission to state therein a material fact required
to be stated therein or necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading, in each case to
the extent, but only to the extent, that any such loss, liability, claim, damage
or expense arises out of or is based upon any 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 Indemnified Holder expressly for use therein; PROVIDED, HOWEVER, that in no
case shall the Indemnified Holder be liable or responsible for any amount in
excess of the amount such Indemnified Holder paid for its Notes. This indemnity
will be in addition to any liability which the Indemnified Holder may otherwise
have, including, without limitation, under this Agreement.
(c) Promptly after receipt by an indemnified party under
subsection (a) or (b) above of notice of the commencement of any action, such
indemnified party shall, if a claim in respect thereof is to be made against the
indemnifying party under such subsection, notify each party against whom
indemnification is to be sought in writing of the commencement thereof (but the
failure so to notify an indemnifying party shall not relieve it from any
liability which it may have under this Section 7 except to the extent that it
has been prejudiced in any material respect by such failure). In case any such
action is brought against any indemnified party, and it notifies an indemnifying
party of the commencement thereof, the indemnifying party will be entitled to
participate therein, and to the extent it may elect by written notice delivered
to the indemnified party promptly after receiving the aforesaid notice from such
indemnified party, to assume the defense thereof with counsel reasonably
satisfactory to such indemnified party. Notwithstanding the foregoing, the
indemnified party or parties shall have the right to employ its or their own
counsel in any such case, but the fees and expenses of such counsel shall be at
the expense of such indemnified party or parties unless (i) the employment of
such counsel shall have been authorized in writing by the indemnifying parties
in connection with the defense of such action, (ii) the indemnifying parties
shall not have employed counsel to take charge of the defense of such action
within a reasonable time after notice of commencement of the action, or (iii)
such indemnified party or parties shall have reasonably concluded that there may
be defenses available to it or them which are different from or additional to
those available to one or all of the indemnifying parties (in which case the
indemnifying party or parties shall not have the right to direct the defense of
such action on behalf of the indemnified party or parties), in any of which
events such fees and expenses of counsel shall be borne by the indemnifying
parties. The indemnifying party under subsection (a) or (b) above shall only be
liable for the legal expenses of one counsel for all indemnified parties in each
jurisdiction in which any claim or action is brought; PROVIDED, HOWEVER, that
the indemnifying party shall be liable for separate counsel for any indemnified
party in a jurisdiction, if counsel to the indemnified parties shall have
reasonably concluded that there may be defenses available to such indemnified
party that are different from or additional to those available to one or more of
the other indemnified parties and that separate counsel for such indemnified
party is prudent under the circumstances. Anything in this subsection to the
contrary notwithstanding, an indemnifying party shall not be liable for any
settlement of any claim or action effected without its written consent;
PROVIDED, HOWEVER, that such written consent was not unreasonably withheld.
(d) In order to provide for contribution in circumstances in
which the indemnification provided for in Section 7 is for any reason held to be
unavailable, the Company and the Indemnified Holder shall contribute to the
aggregate losses, claims, damages, liabilities and expenses of the nature
contemplated by such indemnification provision (including any investigation,
legal and other expenses incurred in connection with, and any amount paid in
settlement of, any action, suit or proceeding or any claims asserted, but after
deducting in the case of losses, claims, damages, liabilities and expenses
suffered by the Company, any contribution received by the Company from persons,
other than the Indemnified Holder, who may also be liable for contribution,
including persons who control the Company within the meaning of Section 15 of
the Act or Section 20(a) of the Exchange Act) to which the Company and the
Indemnified Holder may be subject, in such proportions as is appropriate to
reflect the relative benefits received by the Company and the Indemnified Holder
from the offering of the Notes or, if such allocation is not permitted by
applicable law or indemnification is not available as a result of the
indemnifying party not having received notice as provided in Section 7(c), in
such proportion as is appropriate to reflect not only the relative benefits
referred to above but also the relative fault of the Company and the Indemnified
Holder in connection with the statements or omissions which resulted in such
losses, claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Company and the
Indemnified Holder shall be deemed to be in the same proportion as (x) the total
proceeds from the offering of Notes (net of discounts and commissions but before
deducting expenses) received by the Company and (y) the amount received by such
Holder upon the sale of its Notes . The relative fault of the Company and of the
Indemnified Holder shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company or the Indemnified Holder and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company and the Indemnified Holder agree that it
would not be just and equitable if contribution pursuant to this Section 7(d)
were determined by PRO RATA allocation or by any other method of allocation
which does not take into account the equitable considerations referred to above.
Notwithstanding the provisions of this Section 7(d), (i) in no case shall the
Indemnified Holder be required to contribute any amount in excess of the amount
such Indemnified Holder paid for its Notes and (ii) 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 7(d), each person, if
any, who controls the Indemnified Holder within the meaning of Section 15 of the
Act or Section 20(a) of the Exchange Act, shall have the same rights to
contribution as the Indemnified Holder, and each person, if any, who controls
the Company within the meaning of Section 15 of the Act or Section 20(a) of the
Exchange Act, each of the officers of the Company and each director of the
Company shall have the same rights to contribution as the Company, subject in
each case to clauses (i) and (ii) of this Section 7(d). Any party entitled to
contribution will, promptly after receipt of notice of commencement of any
action, suit or proceeding against such party in respect of which a claim for
contribution may be made against another party or parties under this Section
7(d), notify such party or parties from whom contribution may be sought, but the
omission to so notify such party or parties shall not relieve the party or
parties from whom contribution may be sought from any obligation it or they may
have under this Section 7(d) or otherwise. No party shall be liable for
contribution with respect to any action or claim settled without its written
consent; PROVIDED, HOWEVER, that such written consent was not unreasonably
withheld.
SECTION 8. RULE 144A
The Company hereby agrees with each Holder, for so long as any Transfer
Restricted Securities remain outstanding, to make available to any Holder or
beneficial owner of Transfer Restricted Securities in connection with any sale
thereof and any prospective purchaser of such Transfer Restricted Securities
from such Holder or beneficial owner, the information required by Rule
144A(d)(4) under the Act in order to permit resales of such Transfer Restricted
Securities pursuant to Rule 144A.
SECTION 9. 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 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. Notwithstanding anything to the
contrary herein, the Company shall not be required to undertake more than one
Underwritten Offering hereunder.
SECTION 10. 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. 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 11. MISCELLANEOUS
(a) REMEDIES. The Company agrees 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 agrees to waive the defense in any action for specific
performance that a remedy at law would be adequate.
(b) NO INCONSISTENT AGREEMENTS. The Company will not on or after the
date of this Agreement enter into any agreement with respect to its securities
that is inconsistent with the rights granted to the Holders in this Agreement or
otherwise conflicts with the provisions hereof, except in connection with an
exchange offer relating to its outstanding $250,000,000 principal amount of 72%
Senior Subordinated Notes due September 1, 2007. The Company has not previously
entered into any agreement granting any registration rights with respect to its
securities to any Person, which rights remain exercisable at the date hereof.
The rights granted to the Holders hereunder do not in any way conflict with and
are not inconsistent with the rights granted to the holders of the Company's
securities under any agreement in effect on the date hereof.
(c) 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.
(d) NOTICES. All communications hereunder, except as may be otherwise
specifically provided herein, shall be in writing and, if sent to a Holder,
shall be mailed, physically delivered or telefaxed, and confirmed in writing, to
such 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 if sent to the
Company, shall be mailed, physically delivered or telefaxed, and confirmed in
writing, to Xxxx XX Industries, Inc. One Towne Centre, 000 Xxxx Xxxxx Xxxxxxx
Xxxxxxx, Xxxxxxx, Xxx Xxxx 00000-0000 Attention: Chief Financial Officer,
telecopy number: (000) 000-0000, with a copy to Lippes, Xxxxxxxxxxx, Xxxxxxx &
Xxxxxx LLP, 700 Guaranty Building, 00 Xxxxxx Xxxxxx, Xxxxxxx, Xxx Xxxx
00000-0000, Attention: Xxxxxx X. Xxxxxx, Esq., telecopy number: (000) 000-0000,
and with a copy to Stroock & Stroock & Xxxxx LLP, 000 Xxxxxx Xxxx, Xxx Xxxx, Xxx
Xxxx 00000-0000, Attention: Xxxxx X. Xxxxxxxxx, Esq., telecopy number: (212)
806-6006.
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five business
days after being deposited in the mail, postage prepaid, if mailed; when receipt
acknowledged, if telefaxed; 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.
(e) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit of
and be binding upon the successors and assigns of each of the parties, including
without limitation and without the need for an express assignment, subsequent
Holders of Transfer Restricted Securities; PROVIDED, HOWEVER, that this
Agreement shall not inure to the benefit of or be binding upon a successor or
assign of a Holder unless and to the extent such successor or assign acquired
Transfer Restricted Securities from such Holder.
(f) 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.
(g) HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(h) GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of New York.
(i) 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.
(j) ENTIRE AGREEMENT. This Agreement together with the other Transaction
Agreements (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 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 page to follow]
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
XXXX XX INDUSTRIES, INC.
By:_________________________
Name:
Title:
Accepted and agreed to as of
the date first above written:
By: BEAR, XXXXXXX & CO. INC.
By:____________________________
Name:
Title:
