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REGISTRATION RIGHTS AGREEMENT
Dated as of February 16, 1999
Among
COMPLETEL EUROPE N.V.
as Issuer
and
XXXXXXX XXXXX XXXXXX INC.,
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED,
XXXXXX & XXXXXXX & CO. INCORPORATED,
TD SECURITIES (USA) INC.
and
PARIBAS CORPORATION
as Initial Purchasers
14% Senior Notes due 2009
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REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "AGREEMENT") is
dated as of February 16, 1999, among COMPLETEL EUROPE N.V., a Netherlands
public company with limited liability (the "COMPANY"), as issuer, and XXXXXXX
XXXXX BARNEY INC., XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX INCORPORATED, XXXXXX
XXXXXXX & CO. INCORPORATED, TD SECURITIES (USA) INC. and PARIBAS CORPORATION,
as Initial Purchasers (the "INITIAL PURCHASERS").
This Agreement is entered into in connection with the
Purchase Agreement, dated as of February 16, 1999, among the Company, and
CompleTel Holdings, LLC ("Holdings"), as issuers, and the Initial Purchasers
(the "PURCHASE AGREEMENT"), which provides for, among other things, the sale
by the Company and Holdings to the Initial Purchasers of 147,500 Units (the
"Units") consisting of an aggregate of $147,500,000 principal amount at
maturity of the Company's 14% Senior Discount Notes Due 2009 (the
"Securities") and 1,475,000 Non-Voting Class B Membership Interests (the
"Class B Interests") of Holdings. In order to induce the Initial Purchasers
to enter into the Purchase Agreement, the Company has agreed to provide the
registration rights set forth in this Agreement for the benefit of the
Initial Purchasers and any subsequent holder or holders of each of the
Securities. The execution and delivery of this Agreement is a condition to
the Initial Purchasers' obligation to purchase the Units under the Purchase
Agreement.
The parties hereby agree as follows:
1. DEFINITIONS
As used in this Agreement, the following terms shall have the
following meanings:
ACCRETED VALUE: Shall have the meaning set forth in the
Indenture.
ADVICE: See Section 5 hereof.
AGREEMENT: See the introductory paragraphs hereto.
APPLICABLE PERIOD: See Section 2 hereof.
COMPANY: See the introductory paragraph hereto.
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EFFECTIVENESS DATE: The 240th day after the Issue Date;
PROVIDED, HOWEVER, that with respect to any Shelf Registration (other than a
Shelf Registration if no Exchange Offer Registration Statement has been
filed), the Effectiveness Date shall be the 30th day after the applicable
Registration Statement with respect thereto is filed.
EFFECTIVENESS PERIOD: See Section 3 hereof.
EVENT DATE: See Section 4 hereof.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended,
and the rules and regulations of the SEC promulgated thereunder.
EXCHANGE OFFER: See Section 2 hereof.
EXCHANGE OFFER REGISTRATION STATEMENTS: See Section 2 hereof.
EXCHANGE SECURITIES: See Section 2 hereof.
FILING DATE: (i) with respect to the Exchange Offer
Registration Statement, the 150th day after the Issue Date and (ii) with
respect to any Shelf Registration Statement, (A) if no Exchange Offer
Registration Statement has been filed by the Company pursuant to this
Agreement, the 150th day after the Issue Date and (B) in each other case
(which may be applicable notwithstanding the consummation of the Exchange
Offer), the 30th day after the delivery of a Shelf Notice.
HOLDER: Any holder of a Registrable Security.
INDEMNIFIED PERSON: See Section 7(c) hereof.
INDEMNIFYING PERSON: See Section 7(c) hereof.
INDENTURE: The Indenture, dated as of February 16, 1999, among
the Company, CompleTel ECC B.V., as guarantor, and U.S. Bank Trust National
Association, as Trustee, pursuant to which the Securities are being issued,
as the same may be amended or supplemented from time to time in accordance
with the terms thereof.
INITIAL PURCHASERS: See the introductory paragraphs hereto.
INITIAL SHELF REGISTRATION: See Section 3(a) hereof.
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INSPECTORS: See Section 5(m) hereof.
ISSUE DATE: February 16, 1999, the date of original issuance of
the Securities.
LIQUIDATED DAMAGES: See Section 4 hereof.
NASD: See Section 5(s) hereof.
OFFERING MEMORANDUM: The final offering memorandum of the
Company and Holdings dated February 16, 1999, in respect of the offering of
the Units.
PARTICIPANT: See Section 7(a) hereof.
PARTICIPATING BROKER-DEALER: See Section 2 hereof.
PERSON: An individual, trustee, corporation, partnership, joint
stock company, trust, unincorporated association, union, business
association, firm or other legal entity.
PRIVATE EXCHANGE: See Section 2 hereof.
PRIVATE EXCHANGE SECURITIES: See Section 2 hereof.
PROSPECTUS: The prospectus included in any Registration
Statement (including, without limitation, any prospectus subject to
completion and a prospectus that includes any information previously omitted
from a prospectus filed as part of an effective registration statement in
reliance upon Rule 430A promulgated under the Securities Act and any term
sheet filed pursuant to Rule 434 under the Securities Act), as amended or
supplemented by any prospectus supplement, and all other amendments and
supplements to the Prospectus, including post-effective amendments, and all
material incorporated by reference or deemed to be incorporated by reference
in such Prospectus.
PURCHASE AGREEMENT: See the introductory paragraphs hereto.
RECORDS: See Section 5(m) hereof.
REGISTRABLE SECURITIES: Each Security upon its original
issuance and at all times subsequent thereto, each Exchange Security as to
which Section 2(c)(iv) hereof is applicable upon original issuance and at all
times subsequent thereto and each Private Exchange Security upon original
issuance
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thereof and at all times subsequent thereto, until (i) a Registration
Statement (other than, with respect to any Exchange Security as to which
Section 2(c)(iv) hereof is applicable, the Exchange Offer Registration
Statement) covering such Security, Exchange Security or Private Exchange
Security has been declared effective by the SEC and such Security, Exchange
Security or such Private Exchange Security, as the case may be, has been
disposed of in accordance with such effective Registration Statement, (ii)
such Security has been exchanged pursuant to the Exchange Offer for an
Exchange Security or Exchange Securities that may be resold without complying
with the prospectus delivery requirements under the Securities Act, (iii)
such Security, Exchange Security or Private Exchange Security, as the case
may be, ceases to be outstanding for purposes of the Indenture or (iv) such
Security, Exchange Security or Private Exchange Security, as the case may be,
may be resold without restriction pursuant to Rule 144 under the Securities
Act.
REGISTRATION STATEMENT: Any registration statement of the
Company that covers any of the Securities, the Exchange Securities or the
Private Exchange Securities, filed with the SEC under the Securities Act,
including the Prospectus, amendments and supplements to such registration
statement, including post-effective amendments, all exhibits, and all
material incorporated by reference or deemed to be incorporated by reference
in such registration statement.
RULE 144: Rule 144 promulgated under the Securities Act, as
such Rule may be amended from time to time, or any similar rule (other than
Rule 144A) or regulation hereafter adopted by the SEC providing for offers
and sales of securities made in compliance therewith resulting in offers and
sales by subsequent holders that are not affiliates of the issuer of such
securities being free of the registration and prospectus delivery
requirements of the Securities Act.
RULE 144A: Rule 144A promulgated under the Securities Act, as
such Rule may be amended from time to time, or any similar rule (other than
Rule 144) or regulation hereafter adopted by the SEC.
RULE 415: Rule 415 promulgated under the Securities Act, as
such Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC.
SEC: The Securities and Exchange Commission.
SECURITIES: See the introductory paragraphs hereto.
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SECURITIES ACT: The Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder.
SEMI-ANNUAL ACCRUAL DATE: Shall have the meaning set forth in
the Indenture.
SHELF NOTICE: See Section 2 hereof.
SHELF REGISTRATION: See Section 3(b) hereof.
SUBSEQUENT SHELF REGISTRATION: See Section 3(b) hereof.
TIA: The Trust Indenture Act of 1939, as amended.
TRUSTEE: The trustee under the Indenture and the trustee under
any indenture governing the Exchange Securities and Private Exchange
Securities.
UNDERWRITTEN REGISTRATION OR UNDERWRITTEN OFFERING: A
registration in which securities of the Company are sold to an underwriter
for reoffering to the public.
2. EXCHANGE OFFER
(a) The Company shall file with the SEC, no later than the
Filing Date with respect to the Exchange Offer Registration Statement, a
Registration Statement (the "EXCHANGE OFFER REGISTRATION STATEMENT") on the
appropriate registration form with respect to the registered offer (the
"EXCHANGE OFFER") to exchange any and all of each of the Registrable
Securities for a like aggregate principal amount of Securities (the "EXCHANGE
SECURITIES") of the Company that are identical in all material respects to
the Securities, except that the Exchange Securities shall contain no
restrictive legend thereon other than in the case of Private Exchange
Securities. The Exchange Securities shall be entitled to the benefits of the
Indenture or a trust indenture which is identical in all material respects to
the Indenture (other than such changes to the Indenture or any such identical
trust indenture as are necessary to comply with the TIA) and which, in either
case, has been qualified under the TIA. The Exchange Offer shall comply with
all applicable tender offer rules and regulations under the Exchange Act and
other applicable law. The Company shall use its reasonable best efforts to
(x) cause each Exchange Offer Registration Statement to be declared effective
under the Securities Act on or before the Effectiveness Date; (y) keep each
Exchange
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Offer open for at least 30 days (or longer if required by applicable law)
after the date that notice of the Exchange Offer is mailed to Holders; and
(z) consummate the Exchange Offer on or prior to the 30th day following the
date on which the applicable Exchange Offer Registration Statement is
declared effective by the SEC. If, after an Exchange Offer Registration
Statement is initially declared effective by the SEC, that Exchange Offer or
the issuance of the Exchange Securities thereunder is interfered with by any
stop order, injunction or other order or requirement of the SEC or any other
governmental agency or court, that Exchange Offer Registration Statement
shall be deemed not to have become effective for purposes of this Agreement.
Except for Initial Purchasers receiving Private Exchange
Securities, if any, each Holder that participates in an Exchange Offer will
be required, as a condition to its participation in the Exchange Offer, to
represent to the Company in writing (which may be contained in the applicable
letter of transmittal) that any Exchange Securities to be received by it will
be acquired in the ordinary course of its business, that at the time of the
consummation of the Exchange Offer such Holder will have no arrangement or
understanding with any Person to participate in the distribution of the
Exchange Securities in violation of the provisions of the Securities Act,
that such Holder is not an affiliate of the Company within the meaning of the
Securities Act and that such Holder reasonably believes such Holder is not
acting on behalf of any Person that could not truthfully make the foregoing
representations.
Upon consummation of an Exchange Offer in accordance with this
Section 2, the provisions of this Agreement shall continue to apply, MUTATIS
MUTANDIS, solely with respect to Registrable Securities that are Private
Exchange Securities, Exchange Securities as to which Section 2(c)(iv) is
applicable and Exchange Securities held by Participating Broker-Dealers (as
defined), and the Company shall have no further obligation to register
Registrable Securities (other than Private Exchange Securities and other than
in respect of any Exchange Securities as to which clause 2(c)(iv) hereof
applies) pursuant to Section 3 hereof.
No securities other than the Exchange Securities shall be
included in the Exchange Offer Registration Statement.
(b) The Company shall include within the Prospectus contained
in the Exchange Offer Registration Statement a section entitled "Plan of
Distribution," reasonably acceptable to
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the Initial Purchasers, which shall contain a summary statement of the
positions taken or policies made by the staff of the SEC with respect to the
potential "underwriter" status of any broker-dealer that is the beneficial
owner (as defined in Rule 13d-3 under the Exchange Act) of any Exchange
Securities received by such broker-dealer in any Exchange Offer (a
"PARTICIPATING BROKER-DEALER"), whether such positions or policies have been
publicly disseminated by the staff of the SEC or such positions or policies
represent the prevailing views of the staff of the SEC. Such "Plan of
Distribution" section shall also expressly permit, to the extent permitted by
applicable policies and regulations of the SEC, the use of the Prospectus by
all Persons subject to the prospectus delivery requirements of the Securities
Act, including, to the extent permitted by applicable policies and
regulations of the SEC, all Participating Broker-Dealers, and include a
statement describing the means by which Participating Broker-Dealers may
resell the Exchange Securities in compliance with the Securities Act.
The Company shall use its reasonable best efforts to keep the
Exchange Offer Registration Statement effective and to amend and supplement
the Prospectus contained therein in order to permit such Prospectus to be
lawfully delivered by all Persons subject to the prospectus delivery
requirements of the Securities Act for such period of time as is necessary to
comply with applicable law in connection with any resale of the Exchange
Securities covered thereby; PROVIDED, HOWEVER, that such period shall not
exceed 210 days after consummation of the Exchange Offer (or such longer
period if extended by the last paragraph of Section 5 herein)) (the
"APPLICABLE PERIOD").
If, prior to consummation of the Exchange Offer, the Initial
Purchasers hold any Securities acquired by them that have, or that are
reasonably likely to be determined to have, the status of an unsold allotment
in an initial distribution, the Company upon the request of the Initial
Purchasers shall simultaneously with the delivery of the Exchange Securities
in the Exchange Offer, issue and deliver to the Initial Purchasers, in
exchange (the "PRIVATE EXCHANGE") for such Securities held by the Initial
Purchasers, a like principal amount of Exchange Securities (the "PRIVATE
EXCHANGE SECURITIES") that are identical in all material respects to the
other Exchange Securities except for the placement of a restrictive legend on
such Private Exchange Securities. The Private Exchange Securities shall be
issued pursuant to the same indenture as the other Exchange Securities and
shall be considered Exchange Securities entitled to the full benefit thereof
for all purposes except as set forth in this paragraph. Each of the Private
Exchange Se-
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curities shall bear the same CUSIP number as the other Exchange Securities.
Interest on the Exchange Securities (including the Private
Exchange Securities) will accrue from (A) the later of (i) the last interest
payment date on which interest was paid on the Securities surrendered in
exchange therefor or (ii) if the Securities are surrendered for exchange on a
date in a period which includes the record date for an interest payment date
to occur on or after the date of such exchange and as to which interest will
be paid, the date on such interest payment date or (B), if no interest has
been paid on the Securities, from the Issue Date.
In connection with each of the Exchange Offer, the Company
shall:
(1) mail, or cause to be mailed, to each Holder of record entitled
to participate in the Exchange Offer a copy of the Prospectus forming
part of the Exchange Offer Registration Statement, together with an
appropriate letter of transmittal and related documents;
(2) use their best efforts to keep the Exchange Offer open for not
less than 20 business days after the date that notice of the Exchange
Offer is mailed to Holders (or longer if required by applicable law);
(3) utilize the services of a depositary for the Exchange Offer
with an address in the Borough of Manhattan, The City of New York;
(4) permit Holders to withdraw tendered Securities at any time
prior to the close of business, New York time, on the last business day
on which the Exchange Offer shall remain open; and
(5) otherwise comply in all material respects with all applicable
laws, rules and regulations.
As soon as practicable after the close of the Exchange Offer
and the Private Exchange, if any, the Company shall:
(1) accept for exchange all Registrable Securities validly
tendered and not validly withdrawn pursuant to the Exchange Offer and
the Private Exchange, if any;
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(2) deliver to the Trustee for cancellation all Registrable
Securities so accepted for exchange and cause the Trustee to
authenticate and deliver promptly to each Holder Registrable
Securities, Exchange Securities or Private Exchange Securities, as the
case may be, equal in principal amount to the securities of such Holder
so accepted for exchange.
The Exchange Offer and Private Exchange shall not be subject to
any conditions, other than that (i) the Exchange Offer or Private Exchange,
as the case may be, does not violate applicable law or any applicable
interpretation of the staff of the SEC, (ii) no action or proceeding shall
have been instituted or threatened in any court or by any governmental agency
which might materially impair the ability of the Company to proceed with the
Exchange Offer or the Private Exchange, and no material adverse development
shall have occurred in any existing action or proceeding with respect to the
Company and (iii) all governmental approvals shall have been obtained, which
approvals the Company deems necessary for the consummation of the Exchange
Offer or Private Exchange.
The Exchange Securities and the Private Exchange Securities
shall be issued under (i) the Indenture or (ii) an indenture identical in all
material respects to the Indenture and which, in either case, has been
qualified under the TIA or is exempt from such qualification and shall
provide that (a) the Exchange Securities (other than the Private Exchange
Securities) shall not be subject to the transfer restrictions set forth in
the Indenture and (b) the Private Exchange Securities shall be subject to the
transfer restrictions set forth in such indenture. The Indenture or such
indenture shall provide that the Exchange Securities, the Private Exchange
Securities and the Securities shall vote and consent together on all matters
as one class and that none of the Exchange Securities, the Private Exchange
Securities or the Securities will have the right to vote or consent as a
separate class on any matter.
(c) If, (i) because of any change in law or in currently
prevailing interpretations of the staff of the SEC, the Company is not
permitted to effect the Exchange Offer, (ii) the Exchange Offer is not
consummated within 270 days of the Issue Date, (iii) any holder of any
Private Exchange Securities so requests in writing to the Company within 60
days after the consummation of the Exchange Offer, or (iv) in the case of any
Holder that is not eligible to participate in the Exchange Offer or that
participates in the Exchange Offer and such Holder
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does not receive Exchange Securities on the date of the exchange that may be
sold without restriction under state and federal securities laws (other than
due solely to the status of such Holder as an affiliate of the Company within
the meaning of the Securities Act), then in the case of each of clauses (i)
to and including (iv) of this sentence, the Company shall promptly deliver to
the Holders and the Trustee written notice thereof (the "SHELF NOTICE") and
shall file a Shelf Registration pursuant to Section 3 hereof.
3. SHELF REGISTRATION
If at any time a Shelf Notice is delivered as contemplated by
Section 2(c) hereof, then:
(a) SHELF REGISTRATION. The Company shall file with the SEC a
Registration Statement for an offering to be made on a continuous basis
pursuant to Rule 415 covering all of the Registrable Securities not exchanged
in the Exchange Offer, Private Exchange Securities and Exchange Securities as
to which Section 2(c)(iv) is applicable (the "INITIAL SHELF REGISTRATION").
The Company shall use its best efforts to file with the SEC the Initial Shelf
Registration on or before the applicable Filing Date. The Initial Shelf
Registration shall be on the appropriate form permitting registration of such
Registrable Securities for resale by Holders in the manner or manners
designated by them (including, without limitation, one or more underwritten
offerings). The Company shall not permit any securities other than the
Registrable Securities to be included in the Initial Shelf Registration or
any Subsequent Shelf Registration (as defined below).
The Company shall use their reasonable best efforts to cause
the Initial Shelf Registration to be declared effective under the Securities
Act on or prior to the Effectiveness Date and to keep the Initial Shelf
Registration continuously effective under the Securities Act until the date
which is two years from the Issue Date (the "EFFECTIVENESS PERIOD"), or such
shorter period ending when (i) all Registrable Securities covered by the
Initial Shelf Registration have been sold in the manner set forth and as
contemplated in the Initial Shelf Registration or (ii) a Subsequent Shelf
Registration covering all of the Registrable Securities covered by and not
sold under the Initial Shelf Registration or an earlier Subsequent Shelf
Registration has been declared effective under the Securities Act; PROVIDED,
HOWEVER, that the Effectiveness Period in respect of the Initial Shelf
Registration shall be extended to the extent required to permit dealers to
comply with the applicable pro-
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spectus delivery requirements of Rule 174 under the Securities Act and as
otherwise provided herein.
(b) SUBSEQUENT SHELF REGISTRATIONS. If the Initial Shelf
Registration or any Subsequent Shelf Registration ceases to be effective for
any reason at any time during the Effectiveness Period (other than because of
the sale of all of the securities registered thereunder), the Company shall
use their best efforts to obtain the prompt withdrawal of any order
suspending the effectiveness thereof, and in any event shall within 30 days
of such cessation of effectiveness amend the Initial Shelf Registration in a
manner to obtain the withdrawal of the order suspending the effectiveness
thereof, or file an additional "shelf" Registration Statement pursuant to
Rule 415 covering all of the Registrable Securities covered by and not sold
under the Initial Shelf Registration or an earlier Subsequent Shelf
Registration (each, a "SUBSEQUENT SHELF REGISTRATION"). If a Subsequent Shelf
Registration is filed, the Company shall use its best efforts to cause the
Subsequent Shelf Registration to be declared effective under the Securities
Act as soon as practicable after such filing and to keep such subsequent
Shelf Registration continuously effective for the remainder of the
Effectiveness Period. As used herein the term "SHELF REGISTRATION" means the
Initial Shelf Registration and any Subsequent Shelf Registration.
(c) SUPPLEMENTS AND AMENDMENTS. The Company shall promptly
supplement and amend any Shelf Registration if required by the rules,
regulations or instructions applicable to the registration form used for such
Shelf Registration, if required by the Securities Act, or if reasonably
requested by the Holders of a majority in aggregate principal amount of the
Registrable Securities covered by such Registration Statement or by any
underwriter of such Registrable Securities.
4. LIQUIDATED DAMAGES
(a) The Company and the Initial Purchasers agree that the Holders
will suffer damages if the Company fails to fulfill its obligations under
Section 2 or Section 3 hereof and that it would not be feasible to ascertain the
extent of such damages with precision. Accordingly, the Company agrees to pay,
as liquidated damages, additional interest on the Securities ("LIQUIDATED
DAMAGES") under the circumstances and to the extent set forth below (each of
which shall be given independent effect):
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(i) if (A) neither the Exchange Offer Registration Statement nor
the Initial Shelf Registration has been filed on or prior to the applicable
Filing Date or (B) notwithstanding that the Company has filed an Exchange
Offer Registration Statement, the Company is required to file a Shelf
Registration and such Shelf Registration is not filed on or prior to the
Filing Date applicable thereto, then commencing on the day after any such
Filing Date, Liquidated Damages shall accrue on the Accreted Value of the
Securities as of the most recent Semi-Annual Accrual Date at a rate of .50%
per annum for the first 90 days immediately following each such Filing
Date, such Liquidated Damages increasing by an additional .25% per annum at
the beginning of each subsequent 90-day period; or
(ii) if (A) neither the Exchange Offer Registration Statement nor
the Initial Shelf Registration is declared effective by the SEC on or prior
to the relevant Effectiveness Date or (B) notwithstanding that the Company
has caused an Exchange Offer Registration Statement to be declared
effective by the SEC, the Company is required to file a Shelf Registration
and such Shelf Registration is not declared effective by the SEC on or
prior to the Effectiveness Date in respect of such Shelf Registration,
then, commencing on the day after the applicable Effectiveness Date,
Liquidated Damages shall accrue on the Accreted Value of the Securities as
of the most recent Semi-Annual Accrual Date at a rate of .50% per annum for
the first 90 days immediately following the day after such Effectiveness
Date, such Liquidated Damages increasing by an additional .25% per annum at
the beginning of each subsequent 90-day period; or
(iii) if (A) the Company has not exchanged Exchange Securities for
all Securities validly tendered in accordance with the terms of the
Exchange Offer on or prior to the 30th day after the date on which the
Exchange Offer Registration Statement relating thereto was declared
effective or (B) the Exchange Offer Registration Statement or the Shelf
Registration has been declared effective and such Registration Statement
ceases to be effective at any time during the Effectiveness Period (other
than such time as all Securities have been disposed of thereunder) in the
case of a Shelf Registration or during the Applicable Period in the case of
an Exchange Offer Registration Statement, then Liquidated Damages shall
accrue on the Accreted Value of the Securities as of the most recent
Semi-Annual
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Accrual Date at a rate of .50% per annum for the first 90 days
commencing on the (x) 31st day after such effective date, in the case of
(A) above, or (y) the day such Registration Statement ceases to be
effective in the case of (B) above, such Liquidated Damages shall increase
by an additional .25% per annum at the beginning of each such subsequent
90-day period (it being understood and agreed that, notwithstanding any
provision to the contrary, so long as any Security that is the subject of a
Shelf Notice is then covered by an effective Shelf Registration, no
Liquidated Damages shall accrue or accumulate on such Securities);
PROVIDED, HOWEVER, that the rate of Liquidated Damages that shall accrue on
the Securities may not exceed in the aggregate 2.0% per annum Accreted Value
of the Securities as of the most recent Semi-Annual Accrual Date; PROVIDED,
FURTHER, HOWEVER, that (1) upon the filing of the applicable Exchange Offer
Registration Statement or the applicable Shelf Registration as required
hereunder (in the case of clause (i) above of this Section 4(a)), (2) upon
the effectiveness of the applicable Exchange Offer Registration Statement or
the applicable Shelf Registration Statement as required hereunder (in the
case of clause (ii) of this Section 4(a)), or (3) upon the exchange of the
applicable Exchange Securities for all Securities tendered (in the case of
clause (iii)(A) of this Section 4(a), or upon the effectiveness of the
applicable Registration Statement which had ceased to remain effective (in
the case of (iii)(B) of this Section 4(a)), Liquidated Damages on the
Securities in respect of which such events relate as a result of such clause
(or the relevant subclause thereof), as the case may be, shall cease to
accrue or accumulate, as the case may be.
(b) The Company shall notify the Trustee (who shall be acting
under and protected by the terms of the Indenture) within three business days
after each and every date on which an event occurs in respect of which
Liquidated Damages are required to be paid (an "EVENT DATE"). Any amounts of
Liquidated Damages due pursuant to (a)(i), (a)(ii) or (a)(iii) of this
Section 4 shall be payable in cash semiannually on each February 15 and
August 15 (to the holders of record on the February 1 and August 1
immediately preceding such dates), commencing with the first such date
occurring after any such Liquidated Damages commences to accrue. The amount
of Liquidated Damages will be determined by multiplying the applicable rate
of Liquidated Damages by the Accreted Value of the Registrable Securities as
of the most recent Semi-Annual accrual date preceding the date of payment,
multiplied by a fraction, the numerator of
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which is the number of days such rate of Liquidated Damages was applicable
during such period (determined on the basis of a 360-day year comprised of
twelve 30-day months and, in the case of a partial month, the actual number
of days elapsed), and the denominator of which is 360.
5. REGISTRATION PROCEDURES
In connection with the filing of any Registration Statement
pursuant to Sections 2 or 3 hereof, the Company shall effect such
registrations to permit the sale of the securities covered thereby in
accordance with the intended method or methods of disposition thereof, and
pursuant thereto and in connection with any Registration Statement filed by
the Company hereunder, the Company shall:
(a) Prepare and file with the SEC prior to the applicable
Filing Date, a Registration Statement or Registration Statements as
prescribed by Sections 2 or 3 hereof, and use their reasonable best efforts
to cause each such Registration Statement to become effective and remain
effective as provided herein; PROVIDED, HOWEVER, that, if (1) such filing is
pursuant to Section 3 hereof, or (2) a Prospectus contained in the Exchange
Offer Registration Statement filed pursuant to Section 2 hereof is required
to be delivered under the Securities Act by any Participating Broker-Dealer
who seeks to sell Exchange Securities during the Applicable Period relating
thereto, before filing any Registration Statement or Prospectus or any
amendments or supplements thereto, the Company shall furnish to and afford
the Holders of the Registrable Securities included in such Registration
Statement or each such Participating Broker-Dealer, as the case may be, their
counsel and the managing underwriters, if any, a reasonable opportunity to
review copies of all such documents (including copies of any documents to be
incorporated by reference therein and all exhibits thereto) proposed to be
filed (in each case at least five days prior to such filing, or such later
date as is reasonable under the circumstances). The Company shall not file
any Registration Statement or Prospectus or any amendments or supplements
thereto if the Holders of a majority in aggregate principal amount of the
Registrable Securities included in such Registration Statement, or any such
Participating Broker-Dealer, as the case may be, their counsel, or the
managing underwriters, if any, shall reasonably object on a timely basis.
(b) Prepare and file with the SEC such amendments and
post-effective amendments to each Shelf Registration Statement or Exchange Offer
Registration Statement, as the case may
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be, as may be necessary to keep such Registration Statement continuously
effective for the Effectiveness Period or the Applicable Period, as the case
may be; cause the related Prospectus to be supplemented by any prospectus
supplement required by applicable law, and as so supplemented to be filed
pursuant to Rule 424 (or any similar provisions then in force) promulgated
under the Securities Act; and comply with the provisions of the Securities
Act and the Exchange Act applicable to it with respect to the disposition of
all securities covered by such Registration Statement as so amended or in
such Prospectus as so supplemented and with respect to the subsequent resale
of any securities being sold by a Participating Broker-Dealer covered by any
such Prospectus. The Company shall be deemed not to have used their best
efforts to keep a Registration Statement effective during the Effectiveness
Period or the Applicable Period, as the case may be, relating thereto if the
Company voluntarily takes any action that would result in selling Holders of
the Registrable Securities covered thereby or Participating Broker-Dealers
seeking to sell Exchange Securities not being able to sell such Registrable
Securities or such Exchange Securities during that period unless such action
is required by applicable law or permitted by this Agreement.
(c) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in an Exchange Offer Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Securities during the Applicable Period relating thereto from whom
the Company has received written notice that it will be a Participating
Broker-Dealer in the applicable Exchange Offer, notify the selling Holders of
Registrable Securities or each such Participating Broker-Dealer, as the case
may be, their counsel and the managing underwriters, if any, promptly (but in
any event within 2 business days), and confirm such notice in writing, (i)
when a Prospectus or any Prospectus supplement or post-effective amendment
has been filed, and, with respect to a Registration Statement or any
post-effective amendment, when the same has become effective under the
Securities Act (including in such notice a written statement that any Holder
may, upon request, obtain, at the sole expense of the Company, one conformed
copy of such Registration Statement or post-effective amendment including
financial statements and schedules, documents incorporated or deemed to be
incorporated by reference and exhibits), (ii) of the issuance by the SEC of
any stop order suspending the effectiveness of a Registration Statement or of
any order preventing or suspending the use of any preliminary prospectus or
the initiation of any proceedings for that
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purpose, (iii) if at any time when a prospectus is required by the Securities
Act to be delivered in connection with sales of the Registrable Securities or
resales of Exchange Securities by Participating Broker-Dealers the
representations and warranties of the Company contained in any agreement
(including any underwriting agreement) contemplated by Section 5(l) hereof
cease to be true and correct in all material respects, (iv) of the receipt by
the Company of any notification with respect to the suspension of the
qualification or exemption from qualification of a Registration Statement or
any of the Registrable Securities or the Exchange Securities to be sold by
any Participating Broker-Dealer for offer or sale in any jurisdiction, or the
initiation or written threat of any proceeding for such purpose, (v) of the
happening of any event, the existence of any condition or any information
becoming known that makes any statement made in such Registration Statement
or related Prospectus or any document incorporated or deemed to be
incorporated therein by reference untrue in any material respect or that
requires the making of any changes in or amendments or supplements to such
Registration Statement, Prospectus or documents so that, in the case of the
Registration Statement, it will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, and that
in the case of the Prospectus, it will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, and (vi) of the
Company's determination that a post-effective amendment to a Registration
Statement would be appropriate.
(d) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in an Exchange Offer Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Securities during the Applicable Period, use its reasonable best
efforts to prevent the issuance of any order suspending the effectiveness of
a Registration Statement or of any order preventing or suspending the use of
a Prospectus or suspending the qualification (or exemption from
qualification) of any of the Registrable Securities or the Exchange
Securities to be sold by any Participating Broker-Dealer, for sale in any
jurisdiction, and, if any such order is issued, to use its reasonable best
efforts to obtain the withdrawal of any such order at the earliest possible
moment.
-17-
(e) If a Shelf Registration is filed pursuant to Section 3 and
if reasonably requested by the managing underwriter or underwriters (if any),
the Holders of a majority in aggregate principal amount of the Registrable
Securities being sold in connection with an underwritten offering (i) as
promptly as practicable incorporate in a prospectus supplement or
post-effective amendment such information as the managing underwriter or
underwriters (if any), such Holders, or counsel for any of them determine is
reasonably necessary to be included therein, (ii) make all required filings
of such prospectus supplement or such post-effective amendment as soon as
practicable after the Company has received notification of the matters to be
incorporated in such prospectus supplement or post-effective amendment, and
(iii) supplement or make amendments to such Registration Statement.
(f) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in an Exchange Offer Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Securities during the Applicable Period, furnish to each selling
Holder of Registrable Securities and to each such Participating Broker-Dealer
who so requests and to their respective counsel and each managing
underwriter, if any, at the sole expense of the Company, one conformed copy
of the Registration Statement or Registration Statements and each
post-effective amendment thereto, including financial statements and
schedules, and, if requested, all documents incorporated or deemed to be
incorporated therein by reference and all exhibits.
(g) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in an Exchange Offer Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Securities during the Applicable Period, deliver to each selling
Holder of Registrable Securities or each such Participating Broker-Dealer, as
the case may be, their respective counsel, and the underwriters, if any, at
the sole expense of the Company, as many copies of the Prospectus or
Prospectuses (including each form of preliminary prospectus) and each
amendment or supplement thereto and any documents incorporated by reference
therein as such Persons may reasonably request; and, subject to the last
paragraph of this Section 5, the Company hereby consent to the use of such
Prospectus and each amendment or supplement thereto by each of the selling
Holders of Registrable Securities or each such Participating Broker-Dealer,
as the
-18-
case may be, and the underwriters or agents, if any, and dealers (if any), in
connection with the offering and sale of the Registrable Securities covered
by, or the sale by Participating Broker-Dealers of the Exchange Securities
pursuant to, such Prospectus and any amendment or supplement thereto.
(h) Prior to any public offering of Registrable Securities or
any delivery of a Prospectus contained in the Exchange Offer Registration
Statement by any Participating Broker-Dealer who seeks to sell Exchange
Securities during the Applicable Period, use its reasonable best efforts to
register or qualify, and to cooperate with the selling Holders of Registrable
Securities or each such Participating Broker-Dealer, as the case may be, the
managing underwriter or underwriters, if any, and their respective counsel in
connection with the registration or qualification (or exemption from such
registration or qualification) of such Registrable Securities for offer and
sale under the securities or Blue Sky laws of such jurisdictions within the
United States as any selling Holder, Participating Broker-Dealer, or the
managing underwriter or underwriters reasonably request in writing; provided,
however, that where Exchange Securities held by Participating Broker-Dealers
or Registrable Securities are offered other than through an underwritten
offering, the Company agrees to cause its counsel to perform Blue Sky
investigations and file registrations and qualifications required to be filed
pursuant to this Section 5(h), keep each such registration or qualification
(or exemption therefrom) effective during the period such Registration
Statement is required to be kept effective and do any and all other acts or
things reasonably necessary or advisable to enable the disposition in such
jurisdictions of the Exchange held by Participating Broker-Dealers or the
Registrable Securities covered by the Registration Statement; provided,
however, that the Company shall not be required to (A) qualify generally to
do business in any jurisdiction where it is not then so qualified, (B) take
any action that would subject it to general service of process in any such
jurisdiction where it is not then so subject or (C) subject itself to
taxation in excess of a nominal dollar amount in any such jurisdiction where
it is not then so subject.
(i) If a Shelf Registration is filed pursuant to Section 3 hereof,
cooperate with the selling Holders of Registrable Securities and the managing
underwriter or underwriters, if any, to facilitate the timely preparation and
delivery of certificates representing Registrable Securities to be sold, which
certificates shall not bear any restrictive legends and shall be in a form
eligible for deposit with The Depository
-19-
Trust Company; and enable such Registrable Securities to be in such
denominations and registered in such names as the managing underwriter or
underwriters, if any, or Holders may reasonably request.
(j) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in the Exchange Offer Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Securities during the Applicable Period, upon the occurrence of any
event contemplated by paragraph 5(c)(v) or 5(c)(vi) hereof, as promptly as
practicable prepare and (subject to Section 5(a) hereof) file with the SEC,
at the sole expense of the Company, a supplement or post-effective amendment
to the applicable Registration Statement or a supplement to the related
Prospectus or any document incorporated or deemed to be incorporated therein
by reference, or file any other required document so that, as thereafter
delivered to the purchasers of the Registrable Securities being sold
thereunder or to the purchasers of the Exchange Securities to whom such
Prospectus will be delivered by a Participating Broker-Dealer, any such
Prospectus will not contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading. Notwithstanding the foregoing, the Company shall not be
required to amend or supplement a Registration Statement, any related
Prospectus or any document incorporated therein by reference, in the event
that, and for a period not to exceed an aggregate of 60 days in any calendar
year if, (i) an event occurs and is continuing as a result of which a Shelf
Registration would, in the Company's good faith judgment, contain an untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading, and (ii) (a) the Company determines in
its good faith judgment that the disclosure of such event at such time would
have a material adverse effect on the business, operations or prospects of
the Company's or (b) the disclosure otherwise relates to a pending material
business transaction that has not yet been publicly disclosed.
(k) Prior to the effective date of the first Registration
Statement relating to the Registrable Securities, (i) provide the Trustee with
certificates for the Registrable Securities in a form eligible for deposit with
The Depository
-20-
Trust Company and (ii) provide a CUSIP number for the Registrable Securities.
(l) If (1) a Shelf Registration is filed pursuant to Section 3
hereof, or (2) a Prospectus contained in an Exchange Offer Registration
Statement filed pursuant to Section 2 hereof is required to be delivered
under the Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Securities during the Applicable Period, make available for
inspection by any selling Holder of such Registrable Securities being sold,
or each such Participating Broker-Dealer, as the case may be, any underwriter
participating in any such disposition of Registrable Securities, if any, and
any attorney, accountant or other agent retained by any such selling Holder
or each such Participating Broker-Dealer, as the case may be, or underwriter
(collectively, the "INSPECTORS"), at the offices where normally kept, during
reasonable business hours, all financial and other records, pertinent
corporate documents and instruments of the Company and subsidiaries of the
Company (collectively, the "RECORDS") as shall be reasonably necessary to
enable them to exercise any applicable due diligence responsibilities, and
cause the officers, directors and employees of the Company and any of their
subsidiaries to supply all information reasonably requested by any such
Inspector in connection with such Registration Statement and Prospectus. Each
Inspector shall agree in writing that it will keep the Records confidential
and that it will not disclose any of the Records that the Company determines,
in good faith, to be confidential and notify the Inspectors in writing are
confidential unless (i) the disclosure of such Records is necessary to avoid
or correct a material misstatement or material omission in such Registration
Statement or Prospectus, (ii) the release of such Records is ordered pursuant
to a subpoena or other order from a court of competent jurisdiction, or (iii)
the information in such Records has been made generally available to the
public; provided, however, that prior notice shall be provided as soon as
practicable to the Company of the potential disclosure of any information by
such Inspector pursuant to clauses (i) or (ii) of this sentence to permit the
Company to obtain a protective order (or waive the provisions of this
paragraph (m)) and that such Inspector shall take such actions as are
reasonably necessary to protect the confidentiality of such information (if
practicable) to the extent such action is otherwise not inconsistent with, an
impairment of or in derogation of the rights and interests of the Holder or
any Inspector.
(m) Provide an indenture trustee for the Registrable Securities or
the Exchange Securities, as the case may be, and
-21-
cause the Indenture or the trust indenture provided for in Section 2(a)
hereof, as the case may be, to be qualified under the TIA not later than the
effective date of the first Registration Statement relating to the
Registrable Securities; and in connection therewith, cooperate with the
trustee under any such indenture and the Holders of the Registrable
Securities, to effect such changes to such indenture as may be required for
such indenture to be so qualified in accordance with the terms of the TIA;
and execute, and use their reasonable best efforts to cause such trustee to
execute, all documents as may be required to effect such changes, and all
other forms and documents required to be filed with the SEC to enable such
indenture to be so qualified in a timely manner.
(n) Comply with all applicable rules and regulations of the SEC
and make generally available to their securityholders with regard to any
applicable Registration Statement, a consolidated earnings statement
satisfying the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder (or any similar rule promulgated under the Securities Act) no
later than 45 days after the end of any twelve-month period (or 90 days after
the end of any 12-month period if such period is a fiscal year) (i)
commencing at the end of any fiscal quarter in which any Registrable
Securities are sold to underwriters in a firm commitment or best efforts
underwritten offering and (ii) if not sold to underwriters in such an
offering, commencing on the first day of the first fiscal quarter of the
Company after the effective date of a Registration Statement, which
statements shall cover said 12-month periods.
(o) Upon consummation of an Exchange Offer or a Private
Exchange, obtain an opinion of counsel to the Company addressed to the
Trustee for the benefit of all Holders of Registrable Securities
participating in the Exchange Offer or Private Exchange, as the case may be,
that the Exchange Securities (including the Private Exchange Securities, if
any), and the related indenture constitute legal, valid and binding
obligations of the Company, enforceable against them in accordance with their
respective terms subject to customary exceptions and qualifications.
(p) If the Exchange Offer or a Private Exchange is to be
consummated, upon delivery of the Registrable Securities by Holders to the
Company (or to such other Person as directed by the Company) in exchange for the
Exchange Securities or the Private Exchange Securities, as the case may be, the
Company shall xxxx, or cause to be marked, on such Registrable Securities that
such Registrable Securities are being canceled in ex-
-22-
change for the Exchange Securities or the Private Exchange Securities, as the
case may be; PROVIDED that in no event shall such Registrable Securities be
marked as paid or otherwise satisfied.
(q) Cooperate with each seller of Registrable Securities
covered by any Registration Statement and each underwriter, if any,
participating in the disposition of such Registrable Securities and their
respective counsel in connection with any filings required to be made with
the National Association of Securities Dealers, Inc. (the "NASD").
(r) Use their best efforts to take all other steps reasonably
necessary to effect the registration of the applicable Registrable Securities
covered by a Registration Statement contemplated hereby.
The Company may require each seller of any Registrable
Securities as to which any registration is being effected to furnish to the
Company such information regarding such seller and the distribution of such
Registrable Securities as the Company may, from time to time, reasonably
request. The Company may exclude from such registration the Registrable
Securities of any seller for so long as such seller fails to furnish such
information within a reasonable time after receiving such request and in such
event shall have no further obligation under this Agreement (including
without limitation the obligation under Section 4) with respect to such
seller or any subsequent holder of such Registrable Securities. Each seller
as to which any Shelf Registration 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 seller not
materially misleading.
If any such Registration Statement refers to any Holder by name
or otherwise as the holder of any securities of the Company, then such Holder
shall have the right to require (i) the insertion therein of language, in
form and substance reasonably satisfactory to such Holder, to the effect that
the holding by such Holder of such securities is not to be construed as a
recommendation by such Holder of the investment quality of the securities
covered thereby and that such holding does not imply that such Holder will
assist in meeting any future financial requirements of the Company, or (ii)
in the event that such reference to such Holder by name or otherwise is not
required by the Securities Act or any similar federal statute then in force,
the deletion of the reference to such Holder in any amendment or supplement
to the applicable Regis-
-23-
tration Statement filed or prepared subsequent to the time that such
reference ceases to be required.
Each Holder of Registrable Securities and each Participating
Broker-Dealer agrees by its acquisition of such Registrable Securities or
Exchange Securities, as the case may be, to be sold by such Participating
Broker-Dealer, as the case may be, that, upon actual receipt of any notice
from the Company of the happening of any event of the kind described in
Section 5(c)(ii), 5(c)(iv), 5(c)(v), or 5(c)(vi) hereof, such Holder or
Participating Broker-Dealer, as the case may be, will forthwith discontinue
disposition of such Registrable Securities or Exchange Securities, as the
case may be, covered by such Registration Statement or Prospectus until such
Holder's or Participating Broker-Dealer's receipt of the copies of the
supplemented or amended Prospectus contemplated by Section 5(j) hereof, or
until it is advised in writing (the "ADVICE") by the Company that the use of
the applicable Prospectus may be resumed, and has received copies of any
amendments or supplements thereto. In the event that the Company shall give
any such notice, the Applicable Period shall be extended by the number of
days during such periods from and including the date of the giving of such
notice to and including the date when each seller of Registrable Securities
covered by such Registration Statement or Exchange Securities to be sold by
such Participating Broker-Dealer, as the case may be, shall have received (x)
the copies of the supplemented or amended Prospectus contemplated by Section
5(j) hereof or (y) the Advice.
6. REGISTRATION EXPENSES
All fees and expenses incident to the performance of or
compliance with this Agreement by the Company (other than any underwriting
discounts or commissions) shall be borne by the Company whether or not the
Exchange Offer Registration Statements or any Shelf Registration is filed or
becomes effective or the Exchange Offer is consummated, including, without
limitation, (i) all registration and filing fees (including, without
limitation, (A) fees with respect to filings required to be made with the
NASD in connection with an underwritten offering and (B) reasonable fees and
expenses of compliance with state securities or Blue Sky laws (including,
without limitation, reasonable fees and disbursements of counsel in
connection with Blue Sky qualifications of the Registrable Securities or
Exchange Securities and determination of the eligibility of the Registrable
Securities or Exchange Securities for investment under the laws of such
jurisdictions (x) where the holders of Registrable Securities or Exchange
Securities, as the case
-24-
may be, are located, or (y) as provided in Section 5(h) hereof, in the case
of Registrable Securities or Exchange Securities, as the case may be, to be
sold by a Participating Broker-Dealer during the Applicable Period)), (ii)
printing expenses, including, without limitation, expenses of printing
certificates for Registrable Securities or Exchange Securities in a form
eligible for deposit with The Depository Trust Company and of printing
prospectuses if the printing of prospectuses is requested by the managing
underwriter or underwriters, if any, by the Holders of a majority in
aggregate principal amount of the Registrable Securities included in any
Registration Statement or to be sold by any Participating Broker-Dealer, as
the case may be, (iii) messenger, telephone and delivery expenses, (iv) fees
and disbursements of counsel for the Company and reasonable fees and
disbursements of one special counsel for all of the sellers of each of the
Registrable Securities (exclusive of any counsel retained pursuant to Section
7 hereof), (v) reasonable fees and disbursements of all independent certified
public accountants referred to in Section 5(l)(iii) hereof (including,
without limitation, the expenses of any special audit and "cold comfort"
letters required by or incident to such performance), (vi) Securities Act
liability insurance, if the Company desires such insurance, (vii) fees and
expenses of all other Persons retained by the Company, (viii) internal
expenses of the Company (including, without limitation, all salaries and
expenses of officers and employees of the Company performing legal or
accounting duties), (ix) the expense of any annual audit, (x) any fees and
expenses incurred in connection with the listing of the securities to be
registered on any securities exchange, and the obtaining of a rating of the
securities, in each case, if applicable, and (xi) the expenses relating to
printing, word processing and distributing all Registration Statements,
underwriting agreements, indentures and any other documents necessary in
order to comply with this Agreement.
7. INDEMNIFICATION AND CONTRIBUTION
(a) The Company agrees to indemnify and hold harmless each Holder
of the Registrable Securities and each Participating Broker-Dealer selling the
Exchange Securities during the Applicable Period, the affiliates, officers and
directors of each such Person, and each Person, if any, who controls any such
Person within the meaning of either Section 15 of the Securities Act or Section
20 of the Exchange Act (each, a "PARTICIPANT"), from and against any and all
losses, claims, damages, judgments, liabilities and expenses (including, without
limitation, the reasonable legal fees and other expenses actually incurred in
connection with any suit, action or proceeding
-25-
or any claim asserted) caused by, arising out of or based upon any untrue
statement or alleged untrue statement of a material fact contained in any
Registration Statement (or any amendment thereto) or Prospectus (as amended
or supplemented if the Company shall have furnished any amendments or
supplements thereto) or any preliminary prospectus, or caused by, arising out
of or based upon any omission or alleged omission to state therein a material
fact required to be stated therein or necessary to make the statements
therein, in the case of the Prospectus in light of the circumstances under
which they were made, not misleading, EXCEPT insofar as such losses, claims,
damages or liabilities are caused by any untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity
with information relating to any Participant furnished to the Company in
writing by such Participant expressly for use therein and with respect to any
preliminary Prospectus, to the extent that any such loss, claim, damage or
liability arises solely from the fact that any Participant sold Registrable
Securities or Exchange Securities to a person to whom there was not sent or
given a copy of the Prospectus (as amended or supplemented) at or prior to
the written confirmation of such sale if the Company shall have previously
furnished copies thereof to the Participant in accordance herewith and the
Prospectus (as amended or supplemented) would have corrected any such untrue
statement or omission.
(b) Each Participant agrees, severally and not jointly, to
indemnify and hold harmless the Company, the affiliates, officers and
directors of the Company and each Person who controls the Company within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act
to the same extent (but on a several, and not joint, basis) as the foregoing
indemnity from the Company to each Participant, but only with reference to
information relating to such Participant furnished to the Company in writing
by or on behalf of such Participant expressly for use in any Registration
Statement or Prospectus, any amendment or supplement thereto, or any
preliminary prospectus. The liability of any Participant under this paragraph
shall in no event exceed the proceeds received by such Participant from sales
of Registrable Securities or Exchange Securities giving rise to such
obligations.
(c) If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted against
any Person in respect of which indemnity may be sought pursuant to either of the
two preceding paragraphs, such Person (the "INDEMNIFIED PERSON") shall promptly
notify the Persons against whom such indemnity
-26-
may be sought (the "INDEMNIFYING PERSONS") in writing, and the Indemnifying
Persons, upon request of the Indemnified Person, shall retain counsel
reasonably satisfactory to the Indemnified Person to represent the
Indemnified Person and any others the Indemnifying Persons may reasonably
designate in such proceeding and shall pay the fees and expenses actually
incurred by such counsel related to such proceeding; PROVIDED, HOWEVER, that
the failure to so notify the Indemnifying Persons will not relieve it from
any liability under paragraph (a) or (b) above unless and to the extent such
failure results in the forfeiture by the Indemnifying Person of substantial
rights and defenses and the Indemnifying Person was not otherwise aware of
such action or claim. In any such proceeding, any Indemnified Person shall
have the right to retain its own counsel, but the fees and expenses of such
counsel shall be at the expense of such Indemnified Person unless (i) the
Indemnifying Persons and the Indemnified Person shall have mutually agreed to
the contrary, (ii) the Indemnifying Persons shall have failed within a
reasonable period of time to retain counsel reasonably satisfactory to the
Indemnified Person or (iii) the named parties in any such proceeding
(including any impleaded parties) include both any Indemnifying Person and
the Indemnified Person or any affiliate thereof and representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the Indemnifying
Persons shall not, in connection with such proceeding or separate but
substantially similar related proceedings in the same jurisdiction arising
out of the same general allegations, be liable for the fees and expenses of
more than one separate firm (in addition to any local counsel) for all
Indemnified Persons, and that all such fees and expenses shall be reimbursed
promptly as they are incurred. Any such separate firm for the Participants
and such control Persons of Participants shall be designated in writing by
Participants who sold a majority in interest of Registrable Securities and
Exchange Securities sold by all such Participants and shall be reasonably
acceptable to the Company, and any such separate firm for the Company, their
affiliates, officers, directors, representatives, employees and agents and
such control Persons of the Company shall be designated in writing by the
Company and shall be reasonably acceptable to the Holders.
The Indemnifying Persons shall not be liable for any settlement
of any proceeding effected without its prior written consent (which consent
shall not be unreasonably withheld or delayed), but if settled with such
consent or if there be a final non-appealable judgment for the plaintiff for
which the Indemnified Person is entitled to indemnification pursuant to
-27-
this Agreement, each of the Indemnifying Persons agrees to indemnify and hold
harmless each Indemnified Person from and against any loss or liability by
reason of such settlement or judgment. No Indemnifying Person shall, without
the prior written consent of the Indemnified Persons (which consent shall not
be unreasonably withheld or delayed), effect any settlement or compromise of
any pending or threatened proceeding in respect of which any Indemnified
Person is or could have been a party, or indemnity could have been sought
hereunder by such Indemnified Person, unless such settlement (A) includes an
unconditional written release of such Indemnified Person, in form and
substance reasonably satisfactory to such Indemnified Person, from all
liability on claims that are the subject matter of such proceeding and (B)
does not include any statement as to an admission of fault, culpability or
failure to act by or on behalf of such Indemnified Person.
(d) If the indemnification provided for in the first and second
paragraphs of this Section 7 is for any reason unavailable to, or
insufficient to hold harmless, an Indemnified Person in respect of any
losses, claims, damages or liabilities referred to therein, then each
Indemnifying Person under such paragraphs, in lieu of indemnifying such
Indemnified Person thereunder and in order to provide for just and equitable
contribution, shall contribute to the amount paid or payable by such
Indemnified Person as a result of such losses, claims, damages or liabilities
in such proportion as is appropriate to reflect (i) the relative benefits
received by the Indemnifying Person or Persons on the one hand and the
Indemnified Person or Persons on the other from the offering of the
applicable Securities or (ii) if the allocation provided by the foregoing
clause (i) is not permitted by applicable law, not only such relative
benefits but also the relative fault of the Indemnifying Person or Persons on
the one hand and the Indemnified Person or Persons on the other in connection
with the statements or omissions or alleged statements or omissions that
resulted in such losses, claims, damages or liabilities (or actions in
respect thereof) as well as any other relevant equitable considerations. The
relative fault of the parties 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 on the one hand or such Participant or
such other Indemnified Person, as the case may be, on the other, the parties'
relative intent, knowledge, access to information and opportunity to correct
or prevent such statement or omission, and any other equitable considerations
appropriate in the circumstances.
-28-
(e) The parties agree that it would not be just and equitable
if contribution pursuant to this Section 7 were determined by PRO RATA
allocation (even if the Participants were treated as one entity for such
purpose) or by any other method of allocation that does not take account of
the equitable considerations referred to in the immediately preceding
paragraph. The amount paid or payable by an Indemnified Person as a result of
the losses, claims, damages, judgments, liabilities and expenses referred to
in the immediately preceding paragraph shall be deemed to include, subject to
the limitations set forth above, any reasonable legal or other expenses
actually incurred by such Indemnified Person in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
Section 7, in no event shall a Participant be required to contribute any
amount in excess of the amount by which proceeds received by such Participant
from sales of Registrable Securities or Exchange Securities, as the case may
be, exceeds the amount of any damages that such Participant has otherwise
been required to pay or has paid by reason of such untrue or alleged untrue
statement or omission or alleged omission. No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation.
(f) The indemnity and contribution agreements contained in this
Section 7 will be in addition to any liability which the Indemnifying Persons
may otherwise have to the Indemnified Persons referred to above.
8. RULES 144 AND 144A
The Company covenants and agrees that it will file the reports
required to be filed by it under the Securities Act and the Exchange Act and
the rules and regulations adopted by the SEC thereunder in a timely manner in
accordance with the requirements of the Securities Act and the Exchange Act
and, if at any time the Company is not required to file such reports, will,
upon the request of any Holder or beneficial owner of Registrable Securities,
make available such information necessary to permit sales pursuant to Rule
144A under the Securities Act. The Company further covenants and agrees, for
so long as any Registrable Securities remain outstanding that it will take
such further action as any Holder of Registrable Securities may reasonably
request, all to the extent required from time to time to enable such holder
to sell Registrable Securities without registration under the Securities Act
within the limitation of the exemptions provided by (a) Rule 144(k) and Rule
144A un-
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der the Securities Act, as such Rules may be amended from time to time, or
(b) any similar rule or regulation hereafter adopted by the SEC.
9. MISCELLANEOUS
(a) NO INCONSISTENT AGREEMENTS. The Company has not, as of the
date hereof, and the Company shall not, after the date of this Agreement,
enter into any agreement with respect to any of their securities that is
inconsistent with the rights granted to the Holders of Registrable Securities
in this Agreement or otherwise conflicts with the provisions 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
other issued and outstanding securities under any such agreements. The
Company will not enter into any agreement with respect to any of their
securities which will grant to any Person piggy-back registration rights with
respect to any Registration Statement.
(b) ADJUSTMENTS AFFECTING REGISTRABLE SECURITIES. The Company
shall not, directly or indirectly, take any action with respect to the
Registrable Securities that would adversely affect the ability of the Holders
of Registrable Securities to include such Registrable Securities in a
registration undertaken pursuant to this Agreement.
(c) AMENDMENTS AND WAIVERS. The provisions of this Agreement may
not be amended, modified or supplemented, and waivers or consents to departures
from the provisions hereof may not be given, otherwise than with the prior
written consent of (I) the Company and (II)(A) the Holders of not less than a
majority in aggregate principal amount of the then outstanding Registrable
Securities and (B) in circumstances that would adversely affect the
Participating Broker-Dealers, the Participating Broker-Dealers holding not less
than a majority in aggregate principal, as the case may be, of the Exchange
Securities held by all Participating Broker-Dealers; PROVIDED, HOWEVER, that
Section 7 and this Section 10(c) may not be amended, modified or supplemented
without the prior written consent of each Holder and each Participating
Broker-Dealer (including any person who was a Holder or Participating
Broker-Dealer of Registrable Securities or Exchange Securities, as the case may
be, disposed of pursuant to any Registration Statement) affected by any such
amendment, modification or supplement. Notwithstanding the foregoing, a waiver
or consent to depart from the provisions hereof with respect to a matter that
relates exclusively to the rights of Holders of Registrable Securities whose
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securities are being sold pursuant to a Registration Statement and that does
not directly or indirectly affect, impair, limit or compromise the rights of
other Holders of Registrable Securities may be given by Holders of at least a
majority in aggregate principal of the Registrable Securities being sold
pursuant to such Registration Statement.
(d) NOTICES. All notices and other communications (including,
without limitation, any notices or other communications to the Trustee)
provided for or permitted hereunder shall be made in writing by
hand-delivery, registered first-class mail, next-day air courier or facsimile:
(i) if to a Holder of Registrable Securities or any Participating
Broker-Dealer, at the most current address of such Holder or Participating
Broker-Dealer, as the case may be, set forth on the records of the
registrar under the Indenture, the Exchange Indenture or of the Company, as
appropriate.
(ii) if to the Company, at the address as follows:
Prinses Xxxxxxxxxx 00
0000 XX Xxxxxxxxx
Xxx Xxxxxxxxxxx
Attention: Managing Director
with copy to:
CompleTel Europe N.V.
c/o CompleTel LLC
0000 Xxxxx Xxxxxxxx Xxxxxx
Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Attention: Chief Financial Officer
and with a copy to:
ING Trust (Nederland) X.X.
X.X. Xxx 0000
0000 XX Xxxxxxxxx, Xxx Xxxxxxxxxxx
Attention: Xxxx xxx Xxxxxxxxx
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and with a copy to:
Holme Xxxxxxx & Xxxx LLP
0000 Xxxxxxx, Xxxxx 0000
Xxxxxx, Xxxxxxxx 00000
Attention: W. Xxxx Xxxxxx
All such notices and communications shall be deemed to have been
duly given: when delivered by hand, if personally delivered; five business
days after being deposited in the mail, postage prepaid, if mailed; one
business day after being timely delivered to a next-day air courier; and when
receipt is acknowledged by the addressee, if sent by facsimile.
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 and in the manner specified in the Indenture if such communication
relates to the Securities, Exchange Securities or Private Exchange Securities.
(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 hereto, the Holders and the Participating Broker-Dealers; PROVIDED,
HOWEVER, that this Agreement shall not inure to the benefit of or be binding
upon a successor of assign of a Holder or a Participating Broker-Dealer
unless and to the extent such successor or assign holds Registrable
Securities.
(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 LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED ENTIRELY WITHIN THE STATE OF NEW YORK, WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAW. EACH OF THE PARTIES HERETO AGREES
TO SUBMIT TO THE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.
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(i) SEVERABILITY. If any term, provision, covenant or restriction
of this Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the
parties hereto shall use their best efforts to find and employ an alternative
means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction. It is hereby
stipulated and declared to be the intention of the parties that they would
have executed the remaining terms, provisions, covenants and restrictions
without including any of such that may be hereafter declared invalid,
illegal, void or unenforceable.
(j) SECURITIES HELD BY THE COMPANY OR THEIR AFFILIATES. Whenever
the consent or approval of Holders of a specified percentage of Registrable
Securities is required hereunder, Registrable Securities held by the Company
or their affiliates (as such term is defined in Rule 405 under the Securities
Act) shall not be counted in determining whether such consent or approval was
given by the Holders of such required percentage.
(k) THIRD-PARTY BENEFICIARIES. Holders of Registrable Securities,
and Participating Broker-Dealers are intended third-party beneficiaries of
this Agreement, and this Agreement may be enforced by such Persons.
(l) ENTIRE AGREEMENT. This Agreement, together with the Purchase
Agreement and the Indenture are intended by the parties as a final and
exclusive statement of the agreement and understanding of the parties hereto
in respect of the subject matter contained herein and therein and any and all
prior oral or written agreements, representations, or warranties, contracts,
understandings, correspondence, conversations and memoranda between the
Holders on the one hand and the Company on the other, or between or among any
agents, representatives, parents, subsidiaries, affiliates, predecessors in
interest or successors in interest with respect to the subject matter hereof
and thereof are merged herein and replaced hereby.
(m) By the execution and delivery of this Agreement, the Company (i)
acknowledges that it has, by separate written instrument, designated and
appointed CT Corporation System (the "PROCESS AGENT"), 0000 Xxxxxxxx, Xxx Xxxx,
Xxx Xxxx 00000, Xxxxxx Xxxxxx, as its authorized agent upon which process may be
served in any suit, action or proceeding arising out of or
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relating to this Agreement that may be instituted in any Federal or state
court in the State of New York, The City of New York, the Borough of
Manhattan, or brought under Federal or state securities laws or brought by
the Holders, and acknowledges that the Process Agent has accepted such
designation, (ii) submits to the jurisdiction of any such court in any such
suit, action or proceeding and (iii) agrees that service of process upon the
Process Agent and written notice of said service to it at its principal
office in accordance with Section 9(d) hereof, shall be deemed in every
respect effective service of process upon it in any such suit or proceeding.
The Company further agrees to take any and all action, including the
execution and filing of any and all such documents and instruments as may be
necessary to continue such designation and appointment of the Process Agent
in full force and effect so long as the Securities, Exchange Securities or
Private Exchange Securities shall be outstanding; PROVIDED that the Company
may (and shall, to the extent the Process Agent ceases to be able to be
served on the basis contemplated herein) by written notice to the Trustee,
designate such additional or alternative agents for service of process under
this Section 9(m) that (i) maintains an office located in the Borough of
Manhattan, The City of New York in the State of New York, (ii) are either (x)
counsel for the Company or (y) a corporate service company which acts as
agent for service of process for other Persons in the ordinary course of its
business and (iii) agrees to act as agent for service of process in
accordance with this Section 9(d). Such notice shall identify the name of
such agent for process and the address of such agent for process in the
Borough of Manhattan, The City of New York, State of New York.
Notwithstanding the foregoing, there shall, at all times, be at least one
agent for service of process for the Company appointed and acting in
accordance with this Section 9(d).
To the extent that the Company has or hereafter may acquire any
immunity from jurisdiction of any court or from any legal process (whether
through service of notice, attachment prior to judgment, attachment in aid of
execution, execution or otherwise) with respect to itself or its property, it
hereby irrevocably waives such immunity in respect of its obligations under
the above-referenced documents, to the extent permitted by law.
(n) JUDGMENT CURRENCY. The Company hereby agrees, to indemnify each
Holder against any loss incurred by any of them as a result of any judgment or
order being given or made for any amount due under this Agreement and such
judgment or order being expressed and paid in a currency (the "JUDGMENT
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CURRENCY") other than United States dollars and as result of any variation as
between (i) the rate of exchange at which the United States dollars amount is
converted into the Judgment Currency for the purpose of such judgment or
order and (ii) the spot rate of exchange in The City of New York at which any
such person on the date of payment of such judgment or order is able to
purchase United States dollars with the amount of the Judgment Currency
actually received by such person. The foregoing indemnity shall continue in
full force and effect notwithstanding any such judgment or order as
aforesaid. The term "spot rate of exchange" shall include any premiums and
costs of exchange payable in connection with the purchase of, or conversion
into, United States dollars.
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IN WITNESS WHEREOF, the parties have executed this
Agreement as of the date first written above.
COMPLETEL EUROPE N.V.
By: /s/ Xxxxx X. Xxxxx
---------------------------
Name: Xxxxx X. Xxxxx
Title: Attorney-in-Fact
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The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.
XXXXXXX XXXXX XXXXXX INC.,
XXXXXXX LYNCH, PIERCE, XXXXXX & XXXXX
INCORPORATED
XXXXXX XXXXXXX & CO. INCORPORATED,
TD SECURITIES (USA) INC.
and PARIBAS CORPORATION
as Initial Purchasers
By: XXXXXXX XXXXX BARNEY INC.
By: /s/ Xxxxxxxxxxx Clipper
------------------------------------
Name: Xxxxxxxxxxx Clipper
Title: Vice President
