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EXECUTION COPY
REGISTRATION RIGHTS AGREEMENT
Dated as of April 25, 1997
by and between
THE COSMETIC CENTER, INC.
and
REVLON CONSUMER PRODUCTS CORPORATION
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This REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and
entered into as of April 25, 1997 by and between THE COSMETIC CENTER, INC., a
Delaware corporation (the "Company"), and REVLON CONSUMER PRODUCTS CORPORATION,
a Delaware Corporation ("Revlon").
WHEREAS, the Company, Revlon and Prestige Fragrance & Cosmetics, Inc.,
a Delaware corporation ("PFC"), are parties to an Agreement and Plan of Merger
dated as of November 27, 1996 and amended as of February 20, 1997 and March 20,
1997 (the "Merger Agreement") pursuant to which, on the date hereof, PFC has
merged with and into the Company (the "Merger"); and
WHEREAS, the Merger Agreement provides that, in connection with the
Merger, the Company and Revlon shall enter into this Agreement;
NOW, THEREFORE, on consideration of the foregoing, the parties hereby
agree as follows:
SECTION 1. DEFINITIONS
The following terms, as used herein, have the following respective
meanings:
(a) Act means the Securities Act of 1933, as amended.
(b) Advice shall have the meaning set forth in Section 3.
(c) Common Stock means the Class C common stock, par value $.01 per
share, of the Company.
(d) Commission means the Securities and Exchange Commission.
(e) Demand Registration shall have the meaning set forth in Section
2(b).
(f) Exchange Act means the Securities Exchange Act of 1934, as
amended.
(g) NASD means the National Association of Securities Dealers, Inc.
(h) Piggyback Registration shall have the meaning set forth in Section
2(a).
(i) Prospectus means any prospectus in the form included in any
Registration Statement at the time such Registration Statement is filed with
the Commission, or any Prospectus filed with the Commission pursuant to Rule
424 under the Act.
(j) Registrable Securities means shares of Common Stock, but with
respect to any share, only until such time as such share (a) has been
effectively registered under the Act and disposed of in accordance with the
Registration Statement covering it or (b) has been sold to the public pursuant
to Rule 144 (or any similar provision then in force) under the Act or may be
sold to the public pursuant to Rule 144(k) under the Act.
(k) Registration means a Piggyback Registration or a Demand
Registration.
(l) Registration Statement means any registration statement of the
Company filed pursuant to the Act and which covers any of the Registrable
Securities pursuant to the provisions of this Agreement, including a prospectus
and any amendments and supplements to such Registration Statement, including
post-effective amendments, and all exhibits and all material incorporated by
reference in such Registration Statement.
(m) Subject Securities means the Common Stock, and any security
convertible into or exercisable or exchangeable for Common Stock.
SECTION 2. REGISTRATION RIGHTS
(a) Piggyback Registration Rights. Whenever the Company proposes to
register any Subject Securities under the Act, and the registration form to be
used may be used for the registration of the Registrable Securities (other than
a registration statement on Form S-4 or Form S-8 or any similar successor
forms) (a "Piggyback Registration"), the Company shall give written notice to
Revlon, at least 20 days prior to the anticipated filing date, of its intention
to effect such a registration, which notice shall specify the proposed offering
price, the kind and number of securities proposed to be registered, the
distribution arrangements and such other information that at the time would be
appropriate to include in such notice, and shall, subject to Section 2(c),
include in such Piggyback Registration all Registrable Securities with respect
to which the Company has received a written request for inclusion therein
within 20 days after the delivery of such notice; provided, however, that if,
at any time after giving written notice of its intention to register any
securities and prior to the effective date of the Registration Statement filed
in connection with such registration, the Company shall determine for any
reason not to register or to delay registration of such securities, the Company
may, at its election, give written notice of such determination to Revlon and,
thereupon, (i) in the case of a determination not to register, the Company
shall be relieved of its obligation to register any Registrable Securities
under this Section 2(a) in connection with such registration (but not from its
obligation to pay the registration expenses incurred in connection therewith)
and (ii) in the case of a determination to delay registering, the Company shall
be permitted to delay registering any Registrable Securities under this Section
2(a) during the period that the registration of such other securities is
delayed. The Company further agrees to supplement or amend a Registration
Statement if required by applicable laws, rules or regulations or by the
instructions applicable to the registration form used by the Company for such
Registration Statement. Revlon shall be permitted to withdraw all or any part
of its Registrable Securities from a registration at any time prior to the
effective date of the Registration Statement by notifying the Company of such
withdrawal not later than five business days prior to such effective date;
provided that the Company has given Revlon sufficient prior notice of the
anticipated effective date to enable Revlon to exercise such withdrawal rights.
If Revlon withdraws any such securities from a registration pursuant to the
preceding sentence, Revlon shall pay to the Company any incremental expenses of
such registration specifically attributable to the withdrawal of such
Registrable Securities. Registrable Securities with respect to which such
request for registration has been received shall be registered by the Company
and offered to the public in a Piggyback Registration pursuant to this Section
2 on the terms and conditions at least as favorable as those applicable to the
registration of Subject Securities to be sold by the Company and by any other
person selling under such Piggyback Registration.
(b) Demand Registration Rights
(i) Right to Demand by Revlon. On any three occasions after the
date hereof (as set forth in subsection (b)(ii)), Revlon may
make a written request of the Company for registration with
the Commission, under and in accordance with the provisions
of the Act, of all or part of
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the Registrable Securities (a "Demand Registration"), which
request shall identify the name or names of the selling
holders, the type and amount of Registrable Securities to be
sold by each such selling holder and the intended method or
methods of distribution thereof and, in the case of an
underwritten Registration, the name or names of the managing
underwriters thereof, which managing underwriters shall be
subject to the reasonable approval of the Company; provided
that (A) the Company shall not be required to effect such
Demand Registration unless the aggregate fair market value of
securities requested to be included in such Demand
Registration pursuant to this subsection (b)(i) and any
similar registration rights granted to any person or entity
after the date hereof exceeds $5 million and (B) the Company
may, if its Board of Directors determines in the exercise of
its reasonable good faith judgment that to effect such Demand
Registration at such time would have a material adverse
effect on the Company or would require the disclosure in such
Demand Registration of an action (including an acquisition,
disposition, merger, recapitalization, consolidation,
reorganization or similar transaction relating to or
involving the Company or any of its subsidiaries) or an event
and such disclosure would be materially detrimental to the
Company, defer such Demand Registration for a single period
not to exceed 90 days; provided, further, that the Company
may exercise such deferral right only once during any
12-month period. If the Company elects to defer any Demand
Registration pursuant to the terms of the first proviso to
the immediately preceding sentence, the request made by
Revlon shall be automatically withdrawn without further
action on the part of Revlon and no Demand Registration shall
be deemed to have occurred for purposes hereof. All requests
made pursuant to this subsection (b)(i) shall specify the
aggregate number of Registrable Securities requested to be
registered and shall also specify the intended methods of
disposition thereof.
(ii) Number of Demand Registrations. Revlon shall be entitled to
three Demand Registrations. A Demand Registration shall not
be counted as a Demand Registration hereunder until such
Demand Registration has been declared effective by the
Commission and maintained continuously effective for a period
of at least six months or such shorter period when all
Registrable Securities included therein have been sold in
accordance with such Demand Registration (the "Effectiveness
Period"). Notwithstanding the foregoing, if at any time the
Board of Directors of the Company determines in the exercise
of its reasonable good faith judgment that maintaining the
effectiveness of the Demand Registration at such time would
have a material adverse effect on the Company or would
require the disclosure in such Demand Registration of an
action (including an acquisition, disposition, merger,
recapitalization, consolidation, reorganization or similar
transaction relating to or involving the Company or any of
its subsidiaries) or an event and such disclosure would be
materially detrimental to the Company, the Company may allow
the Demand Registration to fail to be effective and usable as
a result of such nondisclosure for up to 30 days during the
Effectiveness Period, but in no event for any period in
excess of 15 consecutive days, provided that the
Effectiveness Period shall be extended by the number of days
during the Effectiveness Period that the Demand Registration
shall have failed to be effective by reason of this
subsection (b)(ii).
(c) Priority on Registrations. If in any Registration, the managing
underwriter or underwriters thereof advise the Company in writing that, in its
or their reasonable opinion, or, in the case of Registration not being
underwritten, the Company shall reasonably determine that, after consultation
with an investment banking firm of nationally recognized standing, the total
number of securities proposed to
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be sold in such Registration exceeds the number that can be sold in such
offering without having a material adverse effect on the success of the
offering (including any impact on the selling price or the number of shares
that any participant may sell), the Company shall include in such Registration
only the number of securities that, in the reasonable opinion of such
underwriter or underwriters or investment banking firm, as the case may be, can
be sold without having a material adverse effect on the success of the
offering, in the following order of priority:
(i) if the Company is registering securities pursuant to a demand
made by any person having demand registration rights (pursuant to
this Agreement or otherwise),
(A) first, the securities the person or persons making such
demand proposes to sell in such registration,
(B) second, the securities requested to be included in such
Registration by the Company or by any other person or entity
granted piggyback registration rights (pursuant to this
Agreement or otherwise), except to the extent that the
piggyback registration rights granted to such person provide
that securities to be included by the Company or by any
other holder of piggyback registration rights shall have
priority over the securities to be included by such person,
and
(C) third, the securities requested to be included in such
Registration by any person granted piggyback registration
rights, the terms of which provide that securities to be
included by the Company or by any other holder of piggyback
registration rights shall have priority over the securities
to be included by such person;
(ii) in any other event,
(A) first, the securities the Company proposes to sell in such
registration,
(B) second, the securities requested to be included in such
registration by any person or entity granted piggyback
registration rights (pursuant to this Agreement or
otherwise), except to the extent that the piggyback
registration rights granted to such person provide that
securities to be included by the Company or by any other
holder of piggyback registration rights shall have priority
over the securities to be included by such person, and
(C) third, the securities requested to be included in such
Registration by any person granted piggyback registration
rights, the terms of which provide that securities to be
included by the Company or by any other holder of piggyback
registration rights shall have priority over the securities
to be included by such person.
To the extent that the privilege of including securities in any
Registration must be allocated among the parties pursuant to clauses (i)(B),
(i)(C), (ii)(B) or (ii)(C) above, the allocation shall be made pro rata based
on the number of securities that each such participant shall have requested to
include therein.
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SECTION 3. REGISTRATION PROCEDURES
With respect to any Registration, the Company shall as expeditiously
as practicable:
(a) prepare and file with the Commission a Registration Statement or
Registration Statements relating to the applicable Registration on any
appropriate form under the Act, which form shall be available for the sale of
the Registrable Securities in accordance with the intended method or methods of
distribution thereof (provided that the Company shall include in any
Registration Statement on a form other than Form S-1 all information that
Revlon shall reasonably request and shall include all financial statements
required by the Commission to be filed therewith), cooperate and assist in any
filings required to be made with the NASD, and use its best efforts to cause
such Registration Statement to become effective; provided that, in the case of
a Demand Registration, the Company shall use its best efforts to file such
Registration Statement with the Commission no later than 45 days after
receiving a written request from Revlon pursuant to Section 2(b)(i) and to
cause such Registration Statement to become effective no later than 120 days
after receiving such request; and provided, further, that before filing a
Registration Statement or Prospectus related thereto or any amendments or
supplements thereto, the Company shall furnish to Revlon and to the
underwriters, if any, copies of all such documents proposed to be filed, which
documents shall be subject to the reasonable review of Revlon and such
underwriters and their respective counsel, and the Company shall not file any
Registration Statement or amendment thereto or any Prospectus or any supplement
thereto to which Revlon or such underwriters shall reasonably object;
(b) prepare and file with the Commission such amendments and
post-effective amendments to the Registration Statement as may be necessary to
keep each Registration Statement effective for the applicable period, or such
shorter period which will terminate when all Registrable Securities covered by
such Registration Statement have been sold; cause each Prospectus to be
supplemented by any required Prospectus supplement, and as so supplemented to
be filed pursuant to Rule 424 under the Act; and comply with the provisions of
the Act with respect to the disposition of all securities covered by such
Registration Statement during the applicable period in accordance with the
intended method or methods of distribution by the sellers thereof set forth in
such Registration Statement or supplement to the Prospectus; the Company shall
not be deemed to have used its best efforts to keep a Registration Statement
effective during the applicable period if it voluntarily takes any action that
would result in Revlon not being able to sell such Registrable Securities
during that period unless such action is required under applicable law;
provided that the foregoing shall not apply to actions taken by the Company in
accordance with the second sentence of Section 2(b)(ii) so long as the Company
complies with the requirements of Section 3(k);
(c) notify Revlon and the managing underwriters, if any, promptly, and
(if requested by any such person) confirm such advice in writing, (i) when the
Registration Statement, any Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to the Registration
Statement or any post-effective amendment, when the same has become effective,
(ii) of any request by the Commission for amendments or supplements to the
Registration Statement or the Prospectus or for additional information, (iii)
of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any
proceedings for that purpose, (iv) if at any time the representations and
warranties of the Company contemplated by Section 3(n) cease to be true and
correct, (v) of the receipt by the Company of any notification with respect to
the suspension of the qualification of the Registrable Securities for sale in
any jurisdiction or the initiation or threatening of any proceeding for such
purpose and (vi) of the happening of any event which makes any statement made
in the Registration Statement, the Prospectus or any document incorporated
therein by reference untrue or which requires the making of any
changes in the Registration Statement, the Prospectus or any document
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incorporated therein by reference in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading;
(d) make every reasonable effort to obtain the withdrawal of any order
suspending the effectiveness of the Registration Statement at the earliest
possible moment;
(e) if requested by Revlon or the managing underwriter or
underwriters, if any, promptly incorporate in a Prospectus supplement or
post-effective amendment such information as Revlon or the managing
underwriters agree should be included therein relating to the plan of
distribution with respect to such Registrable Securities, including information
with respect to the number of Registrable Securities being sold to such
underwriters, the purchase price being paid therefor by such underwriters and
with respect to any other terms of the underwritten (or best efforts
underwritten) offering of the Registrable Securities to be sold in such
offering; and make all required filings of such Prospectus supplement or
post-effective amendment promptly after being notified of the matters to be
incorporated in such Prospectus supplement or post-effective amendment;
(f) furnish to Revlon and each underwriter, if any, without charge,
such number of copies of the Registration Statement and each amendment thereto,
including financial statements and schedules, all documents incorporated
therein by reference and all exhibits (including those incorporated by
reference), as Revlon and such underwriters may reasonably request;
(g) deliver to Revlon and the underwriters, if any, without charge, as
many copies of the Prospectus (including each preliminary prospectus) and each
amendment or supplement thereto as Revlon and such underwriters may reasonably
request; the Company consents to the use of each Prospectus or any amendment or
supplement thereto by Revlon and each of the underwriters, if any, in
connection with the offering and sale of the Registrable Securities covered by
such Prospectus or any amendment or supplement thereto;
(h) prior to any public offering of Registrable Securities, register
or qualify or cooperate with Revlon, the underwriters, if any, and their
respective counsel in connection with the registration or qualification of such
Registrable Securities for offer and sale under the securities or "blue sky"
laws of such jurisdictions as Revlon or any underwriter reasonably requests in
writing, considering the amount of Registrable Securities proposed to be sold
in each such jurisdiction, and do any and all other acts or things necessary or
advisable to enable the disposition in such jurisdictions of the Registrable
Securities covered by the Registration Statement; provided that the Company
shall not be required to qualify generally to do business in any jurisdiction
where it is not then so qualified or to take any action that would subject it
to general service of process in any such jurisdiction where it is not then so
subject;
(i) cooperate with Revlon and the managing underwriters, if any, to
facilitate the timely preparation and delivery of certificates representing
Registrable Securities to be sold and not bearing any restrictive legends and
to be in such denominations and registered in such names as the managing
underwriters may request at least two business days prior to any sale of
Registrable Securities to the underwriters;
(j) use its best efforts to cause the Registrable Securities covered
by the applicable 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 underwriters, if any, to consummate the
disposition of such Registrable Securities;
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(k) upon the occurrence of any event contemplated by Section 3(c),
prepare a supplement or post-effective amendment to the Registration Statement
or the related Prospectus or any document incorporated therein by reference or
file any other required document so that, as thereafter delivered to the
purchasers of the Registrable 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, in the light of the circumstances
under which they were made, not misleading;
(l) cause all Registrable Securities covered by any Registration
Statement to be listed on each securities exchange, the NASDAQ Stock Market or
over-the-counter market on which similar securities issued by the Company are
then listed;
(m) provide a CUSIP number for all Registrable Securities, not later
than the effective date of the applicable Registration Statement;
(n) enter into such agreements (including an underwriting agreement)
and take all such other actions in connection therewith in order to expedite or
facilitate the disposition of such Registrable Securities and in such
connection, whether or not an underwriting agreement is entered into and
whether or not the Registration is an underwritten Registration, (i) make such
representations and warranties to Revlon and the underwriters, if any, in form,
substance and scope as are customarily made by issuers to underwriters in
primary underwritten offerings; (ii) use its reasonable best efforts to obtain
opinions of counsel to the Company and updates thereof (which counsel and
opinions, in form, scope and substance, shall be reasonably satisfactory to the
managing underwriters, if any, and Revlon) addressed to Revlon and the
underwriters, if any, covering the matters customarily covered in opinions
requested in underwritten offerings and such other matters as may be reasonably
requested by Revlon and such underwriters; (iii) use its reasonable best
efforts to obtain "comfort" letters and updates thereof from the Company's
independent certified public accountants addressed to Revlon and the
underwriters, if any, such letters to be in customary form and covering matters
of the type customarily covered in comfort letters to underwriters in
connection with primary underwritten offerings; provided that if such offering
is not an underwritten offering and the customary comfort letter referred to
above cannot be delivered, the Company shall use its reasonable best efforts to
cause its independent accountants to deliver the highest level of comfort
permitted to be given by such accountants under the then applicable standards
of the American Institute of Certified Public Accountants with respect to such
registration statement; (iv) if an underwriting agreement is entered into, the
same shall set forth in full indemnification provisions and procedures
substantially similar to those set forth in Section 6 with respect to the
underwriters and all parties to be indemnified pursuant to such Section; and
(v) the Company shall deliver such documents and certificates as may be
requested by Revlon and the managing underwriters, if any, to evidence
compliance with this Agreement and with any customary conditions contained in
the underwriting agreement or other agreement entered into by the Company. The
above shall be done at each closing under such underwriting or similar
agreement or as and to the extent required thereunder;
(o) make available for inspection by Revlon, any underwriter
participating in any disposition pursuant to such Registration, and any
attorney or accountant retained by Revlon or such underwriter, all 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 representative, underwriter,
attorney or accountant in connection with such Registration Statement; provided
that all records, information or documents that are designated by the Company
in writing as confidential shall be kept confidential by such Persons unless
disclosure of such records, information or documents is required by court or
administrative order or any regulatory body having jurisdiction;
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(p) otherwise use its reasonable best efforts to comply with all
applicable rules and regulations of the Commission, and make generally
available to its security holders, earnings statements satisfying the
provisions of Section 11(a) of the Act, no later than 45 days after the end of
any 12-month period (or 90 days, if such period is a fiscal year) (i)
commencing at the end of any fiscal quarter in which Registrable Securities are
sold to underwriters in a firm or best efforts underwritten offering, or (ii)
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, which statements shall cover said 12-month periods;
and
(q) promptly prior to the filing of any document that is to be
incorporated by reference into any Registration Statement or Prospectus (after
initial filing of the Registration Statement), provide copies of such document
to counsel to Revlon and counsel to the managing underwriters, if any, make the
Company's representatives available for discussion of such document and make
such changes in such document prior to the filing thereof as counsel for Revlon
or such underwriters may reasonably request.
The Company may require Revlon to furnish to the Company such
information regarding the proposed distribution of such securities as the
Company may from time to time reasonably request in writing.
Revlon agrees that, upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 3(c), Revlon shall
forthwith discontinue disposition of Registrable Securities pursuant to the
Registration Statement until receipt of copies of the supplemented or amended
Prospectus as contemplated by Section 3(k), 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, and, if so directed by the
Company, Revlon shall deliver to the Company (at the Company's expense) all
copies, other than permanent file copies then in Revlon's possession, of the
Prospectus covering such Registrable Securities current at the time of receipt
of such notice. In the event the Company shall give any such notice, the time
periods referred to in Section 2(b)(ii) 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 Revlon shall have received the copies of the
supplemented or amended prospectus contemplated by Section 3(k) or the Advice.
SECTION 4. RESTRICTIONS ON PUBLIC SALE
(a) If requested by the managing underwriter or underwriters for any
underwritten Registration, or by Revlon in the case of a Registration that is
not being underwritten, the Company hereby agrees not to offer to sell, or
effect any public or private issuance, sale, distribution or purchase, of any
Common Stock (or securities convertible into, or exercisable or exchangeable
for, Common Stock) for its own account during the 15 business days prior to,
and during the 90-day period beginning on, the effective date of such
Registration, other than issuances of Common Stock and options to purchase
Common Stock in the ordinary course of business pursuant to employee benefit
plans.
(b) The Company shall use its best efforts to cause each purchaser of
Common Stock (or securities convertible into, or exercisable or exchangeable
for, Common Stock) from the Company after the date hereof (other than any such
purchaser in an underwritten public offering by the Company and other than
non-executive employees to whom the Company issues Common Stock or options to
purchase Common Stock in the ordinary course of business pursuant to employee
benefit plans) to agree, if requested by the managing underwriter or
underwriters for any underwritten Registration, or by Revlon in
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the case of a Registration that is not being underwritten, pursuant to a
customary lockup agreement in form and substance satisfactory to counsel to
such managing underwriters or Revlon, as the case may be, not to offer to sell,
or effect any public or private sale, distribution or purchase, of any Common
Stock (or securities convertible into, or exercisable or exchangeable for,
Common Stock) for its own account during the 15 business days prior to, and
during the 90-day period beginning on, the effective date of such Registration.
SECTION 5. REGISTRATION EXPENSES
All expenses incident to the Company's performance of or compliance
with this Agreement shall be borne by the Company, including all registration
and filing fees, the fees and expenses of the counsel and accountants for the
Company (including the expenses of any "comfort" letters and special audits
required by or incident to the performance of such persons), all other costs
and expenses of the Company incident to the preparation, printing and filing
under the Act of the Registration Statement (and all amendments and supplements
thereto) and furnishing copies thereof and of the Prospectus included therein,
the costs and expenses incurred by the Company in connection with the
qualification of the Registrable Securities under the state securities or "blue
sky" laws of various jurisdictions, the costs and expenses associated with
filings required to be made with the NASD (including, if applicable, the fees
and expenses of any "qualified independent underwriter" and its counsel as may
be required by the rules and regulations of the NASD), the costs and expenses
of listing the Registrable Securities for trading on a national securities
exchange and all other costs and expenses incurred by the Company in connection
with any Registration hereunder; provided that the Company shall not bear the
costs and expenses of Revlon for underwriters' commissions, brokerage fees,
transfer taxes or the fees and expenses of any counsel, accountants or other
representative retained by Revlon.
SECTION 6. INDEMNIFICATION AND CONTRIBUTION
(a) The Company agrees to indemnify and hold harmless Revlon, each
person, if any, who controls Revlon within the meaning of Section 15 of the Act
or Section 20(a) of the Exchange Act and the respective officers, directors,
stockholders, partners, employees, representatives and agents of Revlon or any
controlling person, to the fullest extent lawful, from and against any and all
losses, liabilities, obligations, claims, actions, suits, damages, costs and
expenses whatsoever (including but not limited to reasonable attorneys' fees
and any and all expenses whatsoever incurred in investigating, preparing or
defending against any investigation or 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, obligations, claims, actions, suits, damages, costs 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
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 that the Company shall 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 information relating to Revlon
or its proposed plan of distribution furnished to the Company in writing by or
on behalf of Revlon expressly for use therein. This indemnity agreement shall
be in addition to any liability which the Company may otherwise have, including
under this Agreement.
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(b) Revlon agrees to indemnify and hold harmless the Company, 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 and the respective officers,
directors, stockholders, partners, employees, representatives and agents of the
Company or any controlling person, to the fullest extent lawful, from and
against any and all losses, liabilities, obligations, claims, actions, suits,
damages, costs and expenses whatsoever (including but not limited to reasonable
attorneys' fees and any and all expenses whatsoever incurred in investigating,
preparing or defending against any investigation or 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, obligations, claims, actions, suits, damages, costs 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 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 information relating to Revlon or its proposed plan of distribution
furnished to the Company in writing by or on behalf of Revlon expressly for use
therein; provided, however, that in no case shall Revlon be liable or
responsible, under this indemnity or otherwise, for any amount in excess of the
net proceeds received by Revlon in connection with its sale of Registrable
Securities.
(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 the party against whom
indemnification is to be sought in writing of the commencement thereof (but the
failure so to notify the indemnifying party shall not relieve it from any
liability which it may have under this Section 6 or from any liability which it
may otherwise have except to the extent that it has been prejudiced in any
material respect by such failure). In case any such action is brought against
an indemnified party, and it notifies the indemnifying party of the
commencement thereof, the indemnifying party shall 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 party in
connection with the defense of such action, (ii) the indemnifying party 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, based upon advice
of counsel, that there may be defenses available to it or them which are
different from or additional to those available to the indemnifying party (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 party; provided that the indemnifying party shall only be liable
for the expenses of one counsel (in addition to any local counsel) for all
indemnified parties in each jurisdiction in which any claim or action is
brought. Notwithstanding anything herein to the contrary, an indemnifying party
shall not be liable for any settlement of any claim or action effected without
its prior written consent; provided, further, that such consent was not
unreasonably withheld.
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(d) In order to provide for contribution in circumstances in which the
indemnification provided for in this Section 6 is for any reason held to be
unavailable from the Company or is insufficient to hold harmless a party
indemnified thereunder, the Company, on the one hand, and Revlon, on the other
hand, 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 Revlon, 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 Revlon may be subject, in such proportion as is appropriate to
reflect the relative fault of the Company, on one hand, and Revlon, on the
other hand, 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 fault of the Company, on one
hand, and of Revlon, on the other hand, 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 Revlon and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The Company and Revlon agree that it would
not be just and equitable if contribution pursuant to this Section 6(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 6(d), (i) in no case shall
Revlon be required to contribute any amount in excess of the amount by which
the net proceeds received Revlon from the sale of Registrable Securities
exceeds the amount of any damages which Revlon has otherwise been required to
pay by reason of any untrue or alleged untrue statement or omission or alleged
omission 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 6(d), (A) each person, if any, who controls Revlon within the
meaning of Section 15 of the Act or Section 20(a) of the Exchange Act and (B)
the respective officers, directors, stockholders, partners, employees,
representatives and agents of Revlon or any controlling person shall have the
same rights to contribution as Revlon, and (A) 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 and (B) the respective officers, directors, partners,
employees, representatives and agents of the Company shall have the same rights
to contribution as the Company. Any party entitled to contribution shall,
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 6(d), notify such
party or parties from whom contribution may be sought, but the failure 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 6(d) or otherwise. No party shall be liable for contribution with
respect to any action or claim settled without its prior written consent;
provided that such written consent was not unreasonably withheld.
SECTION 7. RULE 144
The Company agrees that it shall file in a timely manner all reports
required to be filed by it pursuant to the Act and the Exchange Act and shall
take such further action as Revlon may reasonably request in order that Revlon
may effect sales of Registrable Securities pursuant to Rule 144 under the Act.
Upon the request of Revlon, the Company shall furnish Revlon with such
information as may be reasonably necessary to enable Revlon to effect sales of
Common Stock pursuant to Rule 144 under the Act and shall deliver to Revlon a
written statement as to whether the Company has complied with such
11
requirements. Notwithstanding the foregoing, the Company may deregister any
class of its equity securities under Section 12 of the Exchange Act or suspend
its duty to file reports with respect to any class of its securities pursuant
to Section 15(d) of the Exchange Act if it is then permitted to do so pursuant
to the Exchange Act and the rules and regulations thereunder.
SECTION 8. NO INCONSISTENT AGREEMENTS
The Company has not previously entered into and shall not enter into
any agreement with respect to its securities that is inconsistent with the
rights granted in, or otherwise conflicts with the provisions of, this
Agreement.
SECTION 9. MISCELLANEOUS
(a) Notices. All notices and other communications provided for or
permitted hereunder shall be in writing and shall be deemed to have been duly
given if delivered personally or sent by telecopy, overnight courier or
registered or certified mail (return receipt requested) postage prepaid to the
parties at the following addresses (or such other address for any party as
shall be specified by like notice, provided, however, that notices of a change
of address shall be effective only upon receipt thereof). Notice sent by mail
shall be effective five days after mailing.
(i) If to the Company:
The Cosmetic Center, Inc.
0000 Xxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxx 00000
Attention: Vice President and Chief Financial Officer
Telecopy : (000) 000-0000
(ii) If to Revlon:
Revlon Consumer Products Corporation
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Vice President and Secretary
Telecopy: (000) 000-0000
(b) Amendments and Waivers. The provisions of this Agreement,
including the provisions of this sentence, may only be amended, modified or
supplemented, and waivers of or consents to departures from the provisions
hereof may only be given if approved by the Company and Revlon in writing. No
action taken pursuant to this Agreement, including, without limitation, any
investigation by or on behalf of any party, shall be deemed to constitute a
waiver by the party taking such action. The waiver by any party hereto of a
breach of any provision of this Agreement shall not operate or be construed as
waiver of any preceding or succeeding breach and no failure by any party to
exercise any right or privilege hereunder shall be deemed a waiver of such
party's rights or privileges hereunder or shall be deemed a waiver of such
party's rights to exercise the same at any subsequent time or times hereunder.
(c) Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the parties and their respective successors and assigns,
including any subsequent holder of Registrable Securities.
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(d) Counterparts. This Agreement may be executed in one or more
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 instrument.
(e) Headings. The headings in this Agreement are for convenience of
reference only and shall not affect the meaning of any provision of this
Agreement.
(f) GOVERNING LAW. THE VALIDITY, PERFORMANCE, CONSTRUCTION AND EFFECT
OF THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED
THEREIN. THE PARTIES HERETO AGREE 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.
(g) Severability. If any one or more of the provisions contained
herein, or the application thereof in any circumstance, is held to be 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.
13
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
THE COSMETIC CENTER, INC.
By: /s/ Xxxxx X. Xxxxxx
---------------------------------
Name: Xxxxx X. Xxxxxx
Title: Senior Vice President
-Finance
REVLON CONSUMER PRODUCTS CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxx
---------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Vice President
