EXECUTION COPY
================================================================================
A/B EXCHANGE
REGISTRATION RIGHTS AGREEMENT
Dated as of June 28, 2002
by and among
L-3 COMMUNICATIONS CORPORATION
THE GUARANTORS LISTED ON THE SIGNATURE PAGES HERETO
AND
XXXXXX BROTHERS INC.
BANC OF AMERICA SECURITIES LLC
and
CREDIT SUISSE FIRST BOSTON CORPORATION
================================================================================
A/B EXCHANGE REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is made and
entered into as of June 28, 2002 by and among L-3 Communications Corporation, a
Delaware corporation (the "Company") the guarantors listed on the signature
pages hereto (collectively, the "Existing Guarantors"), and Xxxxxx Brothers
Inc., Banc of America Securities LLC and Credit Suisse First Boston Corporation,
as representatives of the several initial purchasers (the "Initial Purchasers")
named in Schedule 1 to the Purchase Agreement (as defined below), each of whom
has agreed to purchase the Company's 7 5/8% Senior Subordinated Notes due 2012
(the "Series A Notes") pursuant to the Purchase Agreement (as defined below).
This Agreement is made pursuant to the Purchase Agreement, dated as of
June 25, 2002 (the "Purchase Agreement"), by and among the Company, the Existing
Guarantors and the Initial Purchasers. In order to induce the Initial Purchasers
to purchase the Series A Notes, the Company and the Existing Guarantors have
agreed to provide the registration rights set forth in this Agreement. The
execution and delivery of this Agreement is a condition to the obligations of
the Initial Purchasers set forth in Section 3 of the Purchase Agreement.
The parties hereby agree as follows:
SECTION 1 DEFINITIONS
As used in this Agreement, the following capitalized terms shall have
the following meanings:
Act: The Securities Act of 1933, as amended.
Additional Guarantor: Any subsidiary of the Company that executes a
Subsidiary Guarantee under the Indenture after the date of this Agreement.
Broker-Dealer: Any broker or dealer registered under the Exchange Act.
Broker-Dealer Transfer Restricted Securities: Series B Notes (including
the Subsidiary Guarantees) that are acquired by a Restricted Broker-Dealer for
its own account as a result of market-making activities or other trading
activities.
Closing Date: The date of this Agreement.
Commission: The Securities and Exchange Commission.
Consummate: A Registered Exchange Offer shall be deemed "Consummated"
for purposes of this Agreement upon the occurrence of (i) the filing and
effectiveness under the Act of the Exchange Offer Registration Statement
relating to the Series B Notes to be issued in the Exchange Offer, (ii) the
maintenance of such Registration Statement continuously effective and the
keeping of the Exchange Offer open for a period not less than the minimum period
required pursuant to Section 3(b) hereof and (iii) the delivery by the Company
to the Registrar under the
Indenture of Series B Notes in the same aggregate principal amount as the
aggregate principal amount of Series A Notes that were tendered by Holders
thereof pursuant to the Exchange Offer.
Damages Payment Date: With respect to the Series A Notes, each Interest
Payment Date.
Effectiveness Target Date: As defined in Section 5.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Exchange Offer: The registration by the Company under the Act of the
Series B Notes (including the Subsidiary Guarantees) pursuant to a Registration
Statement pursuant to which the Company offers the Holders of all outstanding
Transfer Restricted Securities the opportunity to exchange all such outstanding
Transfer Restricted Securities held by such Holders for Series B Notes and
registered Subsidiary Guarantees in an aggregate principal amount equal to the
aggregate principal amount of the Transfer Restricted Securities tendered in
such exchange offer by such Holders.
Exchange Offer Registration Statement: The Registration Statement
relating to the Exchange Offer, including the related Prospectus.
Exempt Resales: The transactions in which the Initial Purchasers
propose to sell the Series A Notes to (i) certain "qualified institutional
buyers," as such term is defined in Rule 144A under the Act, (ii) to certain
institutional "accredited investors," as such term is defined in Rule 501(a)(1),
(2), (3) and (7) under the Act ("Accredited Institutions") and (iii) outside the
United States to Persons other than U.S. Persons in offshore transactions
meeting the requirements of rule 904 of Regulation S under the Act.
Guarantors: The Additional Guarantors and the Existing Guarantors.
Holders: As defined in Section 2 hereof.
Indenture: The Indenture, dated as of the date hereof, among the
Company, the Existing Guarantors and The Bank of New York, as trustee (the
"Trustee"), pursuant to which the Notes are to be issued, as such Indenture is
amended or supplemented from time to time in accordance with the terms thereof.
Initial Purchasers: As defined in the preamble hereto.
Interest Payment Date: As defined in the Notes.
Market-Maker Prospectus: As defined in Section 4 hereof.
NASD: National Association of Securities Dealers, Inc.
Notes: The Series A Notes and the Series B Notes.
Offering Memorandum: As defined in the Purchase Agreement.
2
Person: An individual, partnership, corporation, trust or
unincorporated organization, or a government or agency or political subdivision
thereof.
Prospectus: The prospectus included in a Registration Statement
including, without limitation, a Market-Maker Prospectus, as amended or
supplemented by any prospectus supplement and by all other amendments thereto,
including post-effective amendments, and all material incorporated by reference
into such Prospectus.
Record Holder: With respect to any Damages Payment Date relating to
Notes, each Person who is a Holder of Notes on the record date with respect to
the Interest Payment Date on which such Damages Payment Date shall occur.
Registration Default: As defined in Section 5 hereof.
Registrar: As defined in the Indenture.
Registration Statement: Any registration statement of the Company
relating to (a) an offering of Series B Notes pursuant to an Exchange Offer or
(b) the registration for resale of Transfer Restricted Securities pursuant to
the Shelf Registration Statement, which is filed pursuant to the provisions of
this Agreement including the registration for resale of Broker-Dealer Transfer
Restricted Securities, in each case including the Prospectus included therein,
all amendments and supplements thereto (including post-effective amendments) and
all exhibits and material incorporated by reference therein.
Restricted Broker-Dealer: Any Broker-Dealer that is an affiliate of the
Company that holds Broker-Dealer Transfer Restricted Securities.
Series B Notes: The Company's 7 5/8% Senior Subordinated Notes due 2012
to be issued pursuant to the Indenture in the Exchange Offer.
Shelf Filing Deadline: As defined in Section 4 hereof.
Shelf Registration Statement: As defined in Section 4 hereof.
Subsidiary Guarantee: The Guarantee by a Guarantor of the Company's
obligations under the Notes and Indenture.
TIA: The Trust Indenture Act of 1939 (15 U.S.C. Section 77aaa-77bbbb)
as in effect on the date of the Indenture.
Transfer Restricted Securities: Each Note (including the Subsidiary
Guarantees), until the earliest to occur of (a) the date on which such Note is
exchanged by a person other than a Broker-Dealer for a Series B Note in the
Exchange Offer (b) following the exchange by a Broker-Dealer in the Exchange
Offer of a Note for a Series B Note, the date on which such Series B Note is
sold to a purchaser who receives from such Broker-Dealer on or prior to the date
of such sale a copy of the Prospectus contained in the Exchange Offer
Registration Statement, (c) the date on which such Note (including the
Subsidiary Guarantees) is effectively registered under the Act and disposed of
in accordance with the Shelf Registration Statement or (d) the date on
3
which such Note (including the Subsidiary Guarantees) is distributed to the
public pursuant to Rule 144 under the Act.
Underwritten Registration or Underwritten Offering: A registration in
which securities of the Company are sold to an underwriter for reoffering to the
public.
SECTION 2 SECURITIES SUBJECT TO THIS AGREEMENT
(a) Transfer Restricted Securities and Broker-Dealer Transfer
Restricted Securities. The securities entitled to the benefits of this Agreement
are the Transfer Restricted Securities and Broker-Dealer Transfer Restricted
Securities.
(b) Holders of Transfer Restricted Securities. A Person is deemed to be
a holder of Transfer Restricted Securities (each, a "Holder") whenever such
Person owns Transfer Restricted Securities.
(c) Holders of Broker-Dealer Transfer Restricted Securities. A
Restricted Broker-Dealer is deemed to be a holder of Broker-Dealer Transfer
Restricted Securities (each, a "Holder") whenever such Restricted Broker-Dealer
owns Broker-Dealer Transfer Restricted Securities.
SECTION 3 REGISTERED EXCHANGE OFFER
(a) Unless the Exchange Offer shall not be permissible under applicable
law or Commission policy (after the procedures set forth in Section 6(a) below
have been complied with), the Company and the Guarantors shall (i) cause to be
filed with the Commission as promptly as practicable after the Closing Date, but
in no event later than 90 days after the Closing Date, a Registration Statement
under the Act relating to the Series B Notes (including the Subsidiary
Guarantees) and the Exchange Offer, (ii) use all commercially reasonable efforts
to cause such Registration Statement to be declared effective by the Commission
as promptly as practicable, but in no event later than 180 days after the
Closing Date (which 180-day period shall be extended for a number of days equal
to the number of business days, if any, the Commission is officially closed
during such period), (iii) in connection with the foregoing, file (A) all
pre-effective amendments to such Registration Statement as may be necessary in
order to cause such Registration Statement to become effective, (B) if
applicable, a post-effective amendment to such Registration Statement pursuant
to Rule 430A under the Act and (C) cause all necessary filings in connection
with the registration and qualification of the Series B Notes (including the
Subsidiary Guarantees) to be made under the Blue Sky laws of such jurisdictions
as are necessary to permit Consummation of the Exchange Offer and (iv) upon the
effectiveness of such Registration Statement, commence the Exchange Offer. The
Exchange Offer shall be on the appropriate form permitting registration of the
Series B Notes (including the Subsidiary Guarantees) to be offered in exchange
for the Transfer Restricted Securities and to permit resales of Notes held by
Broker-Dealers as contemplated by Section 3(c) below.
(b) The Company and the Guarantors shall cause the Exchange Offer
Registration Statement to be effective continuously and shall keep the Exchange
Offer open for a period of not less than the minimum period required under
applicable federal and state securities laws to Consummate the Exchange Offer;
provided, however, that in no event shall such period be less than 20 business
days. The Company and the Guarantors shall cause the Exchange Offer to
4
comply with all applicable federal and state securities laws. No securities
other than the Notes (including the Subsidiary Guarantees) shall be included in
the Exchange Offer Registration Statement. The Company and the Guarantors shall
use all commercially reasonable efforts to cause the Exchange Offer to be
Consummated on the earliest practicable date after the Exchange Offer
Registration Statement has become effective, but in no event later than 30
business days thereafter.
(c) The Company and the Guarantors shall indicate in a "Plan of
Distribution" section contained in the Prospectus contained in the Exchange
Offer Registration Statement that any Broker-Dealer who owns Series A Notes that
are Transfer Restricted Securities and that were acquired for its own account as
a result of market-making activities or other trading activities (other than
Transfer Restricted Securities acquired directly from the Company), may exchange
such Series A Notes pursuant to the Exchange Offer; however, such Broker-Dealer
may be deemed to be an "underwriter" within the meaning of the Act and must,
therefore, deliver a Prospectus meeting the requirements of the Act in
connection with any resales of the Series B Notes received by such Broker-Dealer
in the Exchange Offer, which Prospectus delivery requirement may be satisfied by
the delivery by such Broker-Dealer of the Prospectus contained in the Exchange
Offer Registration Statement. Such "Plan of Distribution" section shall also
contain all other information with respect to such resales by Broker-Dealers
that the Commission may require in order to permit such resales pursuant
thereto, but such "Plan of Distribution" shall not name any such Broker-Dealer
or disclose the amount of Notes held by any such Broker-Dealer except to the
extent required by the Commission.
The Company and the Guarantors shall use all commercially reasonable
efforts to keep the Exchange Offer Registration Statement continuously
effective, supplemented and amended as required by the provisions of Section
6(d) below to the extent necessary to ensure that it is available for resales of
Notes acquired by Broker-Dealers for their own accounts as a result of
market-making activities or other trading activities, and to ensure that it
conforms with the requirements of this Agreement, the Act and the policies,
rules and regulations of the Commission as announced from time to time, for a
period of 180 days from the date on which the Exchange Offer Registration
Statement is declared effective or such shorter period that will terminate when
all Notes covered by the Exchange Offer Registration Statement have been
exchanged in the Exchange Offer.
The Company and the Guarantors shall provide sufficient copies of the
latest version of such Prospectus to Broker-Dealers promptly upon request at any
time during such 180 day period in order to facilitate such resales.
SECTION 4 SHELF REGISTRATION; MARKET-MAKER PROSPECTUS
(a) Shelf Registration. If (i) the Company and the Guarantors are not
required to file the Exchange Offer Registration Statement or permitted to
Consummate the Exchange Offer because the Exchange Offer is not permitted by
applicable law or Commission policy (after the procedures set forth in Section
6(a) below have been complied with) or (ii) any Holder of Transfer Restricted
Securities that is a "qualified institutional buyer," as such term is defined in
Rule 144A under the Act or an institutional "accredited investor," as such term
is defined in Rule 501(a)(1), (2), (3) and (7) under the Act shall notify the
Company prior to the 20th day following
5
the Consummation of the Exchange Offer that such Holder alone or together with
holders who hold in the aggregate at least $1.0 million in principal amount of
Series A Notes (A) is prohibited by applicable law or Commission policy from
participating in the Exchange Offer, or (B) may not resell the Series B Notes
acquired by it in the Exchange Offer to the public without delivering a
prospectus and that the Prospectus contained in the Exchange Offer Registration
Statement is not appropriate or available for such resales by such Holder, or
(C) is a Broker-Dealer and holds Series A Notes acquired directly from the
Company or an affiliate of the Company, the Company and the Guarantors shall:
(i) cause to be filed with the Commission a shelf Registration
Statement pursuant to Rule 415 under the Act, which may be an amendment
to the Exchange Offer Registration Statement (in either event, the
"Shelf Registration Statement") on or prior to the earliest to occur of
(A) the 30th day after the date on which the Company determines that it
is not required to file the Exchange Offer Registration Statement, or
permitted to Consummate the Exchange Offer and (B) the 30th day after
the date on which the Company receives notice from a Holder of Transfer
Restricted Securities as contemplated by clause (ii) of paragraph (a)
above (such earliest date being the "Shelf Filing Deadline"), which
Shelf Registration Statement shall provide for resales of all Transfer
Restricted Securities the Holders of which shall have provided the
information required pursuant to Section 4(b) hereof; and
(ii) use all commercially reasonable efforts to cause such
Shelf Registration Statement to be declared effective by the Commission
on or before the 90th day after the Shelf Filing Deadline.
The Company and the Guarantors shall use all commercially reasonable efforts to
keep such Shelf Registration Statement continuously effective, supplemented and
amended as required by the provisions of Sections 6(b) and (d) hereof to the
extent necessary to ensure that it is available for resales of Notes by the
Holders of Transfer Restricted Securities entitled to the benefit of this
Section 4(a), and to ensure that it conforms with the requirements of this
Agreement, the Act and the policies, rules and regulations of the Commission as
announced from time to time, for a period of at least two years following the
Closing Date or such shorter period that will terminate when all Notes covered
by the Shelf Registration Statement have been sold pursuant to the Shelf
Registration Statement or become eligible for resale pursuant to Rule 144
without volume or other restrictions.
(b) Provision by Holders of Certain Information in Connection with the
Shelf Registration Statement. No Holder of Transfer Restricted Securities may
include any of its Transfer Restricted Securities in any Shelf Registration
Statement pursuant to this Agreement unless and until such Holder furnishes to
the Company in writing, within 10 business days after receipt of a request
therefor, such information as the Company may reasonably request for use in
connection with any Shelf Registration Statement or Prospectus or preliminary
Prospectus included therein. No Holder of Transfer Restricted Securities shall
be entitled to additional amounts pursuant to Section 5 hereof unless and until
such Holder shall have used its best efforts to provide all such reasonably
requested information. Each Holder as to which any Shelf Registration Statement
is being effected agrees to furnish promptly to the Company all
6
information required to be disclosed in order to make the information previously
furnished to the Company by such Holder not materially misleading.
(c) Market-Maker Prospectus. The Company and the Guarantors acknowledge
that any Restricted Broker-Dealer holding Broker-Dealer Transfer Restricted
Securities may not resell such Broker-Dealer Transfer Restricted Securities
without delivering a Prospectus. Consequently, on the date that the Exchange
Offer Registration Statement is filed with the Commission, the Company and the
Guarantors shall file a Registration Statement (which may be the Exchange Offer
Registration Statement or the Shelf Registration Statement if permitted by the
rules and regulations of the Commission) and shall use all commercially
reasonable efforts to cause such Registration Statement to be declared effective
by the Commission on or prior to the Consummation of the Exchange Offer. The
Company and the Guarantors shall use all commercially reasonable efforts to keep
such Registration Statement continuously effective, supplemented and amended as
required by the provisions of Sections 6(c) and (d) hereof to the extent
necessary to ensure that it is available for resales of Broker-Dealer Transfer
Restricted Securities by Restricted Broker-Dealers, and to ensure that it
conforms with the requirements of this Agreement, the Act and the policies,
rules and regulations of the Commission as announced from time to time, until
such time as all Restricted Broker-Dealers determine in their judgment that they
are no longer required to deliver a Prospectus in connection with sales of
Broker-Dealer Transfer Restricted Securities. The Prospectus included in such
Registration Statement is referred to in this Agreement as a "Market-Maker
Prospectus."
SECTION 5 ADDITIONAL AMOUNTS
If (i) any of the Registration Statements required by this Agreement is
not filed with the Commission on or prior to the date specified for such filing
in sections 3(a), 4(a), and 4(c), as applicable, (ii) any of such required
Registration Statements has not been declared effective by the Commission on or
prior to the date specified for such effectiveness in sections 3(a), 4(a), and
4(c), as applicable, (the "Effectiveness Target Date"), (iii) the Exchange Offer
has not been Consummated within 30 business days after the Effectiveness Target
Date with respect to the Exchange Offer Registration Statement, or (iv) any
Registration Statement required by this Agreement is filed and declared
effective but shall thereafter cease to be effective or fail to be usable for
its intended purpose without being succeeded within five business days by a
post-effective amendment to such Registration Statement that cures such failure
and that is itself immediately declared effective (each such event referred to
in clauses (i) through (iv), a "Registration Default"), the Company and the
Guarantors jointly and severally agree to pay additional amounts to each Holder
of Transfer Restricted Securities with respect to the first 90-day period
immediately following the occurrence of such Registration Default, in an amount
equal to $.05 per week per $1,000 principal amount of Transfer Restricted
Securities held by such Holder for each week or portion thereof that the
Registration Default continues. The amount of the additional amounts shall
increase by an additional $.05 per week per $1,000 in principal amount of
Transfer Restricted Securities with respect to each subsequent 90-day period
until all Registration Defaults have been cured, up to a maximum amount of
additional amounts of $.50 per week per $1,000 principal amount of Transfer
Restricted Securities. The Company shall in no event be required to pay
additional amounts for more than one Registration Default at any given time. All
accrued additional amounts shall be paid to Record Holders by the Company and
the Guarantors by wire transfer of immediately available funds or by federal
funds check on
7
each Damages Payment Date, as provided in the Indenture. Following the cure of
all Registration Defaults relating to any particular Transfer Restricted
Securities, the accrual of additional amounts with respect to such Transfer
Restricted Securities will cease.
All payment obligations of the Company and the Guarantors set forth in
the preceding paragraph that are outstanding with respect to any Transfer
Restricted Security at the time such security ceases to be a Transfer Restricted
Security shall survive until such time as all such payment obligations with
respect to such Security shall have been satisfied in full provided, however,
that the additional amounts shall cease to accrue on the day immediately prior
to the date such Transfer Restricted Securities cease to be Transfer Restricted
Securities.
SECTION 6 REGISTRATION PROCEDURES
(a) Exchange Offer Registration Statement. In connection with the
Exchange Offer, the Company and the Guarantors shall comply with all of the
provisions of Section 6(d) below, shall use all commercially reasonable efforts
to effect such exchange to permit the sale of Transfer Restricted Securities
being sold in accordance with the intended method or methods of distribution
thereof, and shall comply with all of the following provisions:
(i) If in the reasonable opinion of counsel to the Company and
the Guarantors there is a question as to whether the Exchange Offer is
permitted by applicable law, the Company and the Guarantors hereby
agree to seek a no-action letter or other favorable decision from the
Commission allowing the Company and the Guarantors to Consummate an
Exchange Offer for such Series A Notes. The Company and the Guarantors
hereby agree to pursue the issuance of such a decision to the
Commission staff level but shall not be required to take commercially
unreasonable action to effect a change of Commission policy. The
Company and the Guarantors hereby agree however, to (A) participate in
telephonic conferences with the Commission, (B) deliver to the
Commission staff an analysis prepared by counsel to the Company and the
Guarantors setting forth the legal bases, if any, upon which such
counsel has concluded that such an Exchange Offer should be permitted
and (C) diligently pursue a resolution (which need not be favorable) by
the Commission staff of such submission.
(ii) As a condition to its participation in the Exchange Offer
pursuant to the terms of this Agreement, each Holder of Transfer
Restricted Securities shall furnish, upon the request of the Company,
prior to the Consummation thereof, a written representation to the
Company and the Guarantors (which may be contained in the letter of
transmittal contemplated by the Exchange Offer Registration Statement)
to the effect that (A) it is not an affiliate of the Company, (B) it is
not engaged in, and does not intend to engage in, and has no
arrangement or understanding with any person to participate in, a
distribution of the Series B Notes to be issued in the Exchange Offer
and (C) it is acquiring the Series B Notes in its ordinary course of
business. In addition, all such Holders of Transfer Restricted
Securities shall otherwise cooperate in the Company's and the
Guarantors' preparations for the Exchange Offer. Each Holder hereby
acknowledges and agrees that any Broker-Dealer and any such Holder
using the Exchange Offer to participate in a distribution of the
securities to be acquired in the Exchange Offer (A) could not under
Commission policy as in effect on the date of this Agreement rely on
the position of the
8
Commission enunciated in Xxxxxx Xxxxxxx and Co., Inc. (available June
5, 1991) and Exxon Capital Holdings Corporation (available May 13,
1988), as interpreted in the Commission's letter to Shearman & Sterling
dated July 2, 1993, and similar no-action letters (including any
no-action letter obtained pursuant to clause (i) above), and (B) must
comply with the registration and prospectus delivery requirements of
the Act in connection with a secondary resale transaction and that such
a secondary resale transaction should be covered by an effective
Registration Statement containing the selling security holder
information required by Item 507 or 508, as applicable, of Regulation
S-K if the resales are of Series B Notes obtained by such Holder in
exchange for Series A Notes acquired by such Holder directly from the
Company.
(iii) Prior to effectiveness of the Exchange Offer
Registration Statement, the Company and the Guarantors shall provide a
supplemental letter to the Commission (A) stating that the Company and
the Guarantors are registering the Exchange Offer in reliance on the
position of the Commission enunciated in Exxon Capital Holdings
Corporation (available May 13, 1988), Xxxxxx Xxxxxxx and Co., Inc.
(available June 5, 1991) and, if applicable, any no-action letter
obtained pursuant to clause (i) above and (B) including a
representation that neither the Company nor any Guarantor has entered
into any arrangement or understanding with any Person to distribute the
Series B Notes to be received in the Exchange Offer and that, to the
best of the Company's and each Guarantor's information and belief, each
Holder participating in the Exchange Offer is acquiring the Series B
Notes in its ordinary course of business and has no arrangement or
understanding with any Person to participate in the distribution of the
Series B Notes received in the Exchange Offer.
(b) Shelf Registration Statement. In connection with the Shelf
Registration Statement, the Company and the Guarantors shall comply with all the
provisions of Section 6(d) below and shall use all commercially reasonable
efforts to effect such registration to permit the sale of the Transfer
Restricted Securities being sold in accordance with the intended method or
methods of distribution thereof, and pursuant thereto the Company and the
Guarantors will as expeditiously as possible prepare and file with the
Commission a Registration Statement relating to the registration on any
appropriate form under the Act, which form shall be available for the sale of
the Transfer Restricted Securities in accordance with the intended method or
methods of distribution thereof.
(c) Market-Maker Prospectus. In connection with any Registration
Statement filed pursuant to Section 4(c) of this Agreement, the Company and the
Guarantors will comply with all of the provisions of Section 6(d) below (other
than sub-sections (xiii), (xiv), (xv), (xvii) and (xx)) until such time as all
Restricted Broker-Dealers determine in their reasonable judgment that they are
no longer required to deliver Market-Maker Prospectuses in connection with sales
of Broker-Dealer Transfer Restricted Securities. The Company and the Guarantors
shall use all commercially reasonable efforts to deliver Market-Maker
Prospectuses to all Restricted Broker-Dealers immediately upon the effectiveness
of the Registration Statement and from time to time thereafter upon request, in
such quantities as such Restricted Broker-Dealer shall reasonably require.
9
(d) General Provisions. In connection with any Registration Statement
and any Prospectus required by this Agreement to permit the sale or resale of
Transfer Restricted Securities (including, without limitation, any Registration
Statement and the related Prospectus required to permit resales of Notes by
Broker-Dealers) and Broker-Dealer Transfer Restricted Securities, the Company
and the Guarantors shall:
(i) use all commercially reasonable efforts to keep such
Registration Statement continuously effective and provide all requisite
financial statements (including, if required by the Act or any
regulation thereunder, financial statements of any Guarantors) for the
period specified in Section 3 or 4 of this Agreement, as applicable;
upon the occurrence of any event that would cause any such Registration
Statement or the Prospectus contained therein (A) to contain a material
misstatement or omission or (B) not to be effective and usable for
resale of Transfer Restricted Securities or Broker-Dealer Transfer
Restricted Securities during the period required by this Agreement, the
Company and the Guarantors shall file promptly an appropriate amendment
to such Registration Statement, in the case of clause (A), correcting
any such misstatement or omission, and, in the case of either clause
(A) or (B), use all commercially reasonable efforts to cause such
amendment to be declared effective and such Registration Statement and
the related Prospectus to become usable for their intended purpose(s)
as soon as practicable thereafter. Notwithstanding the foregoing, at
any time after Consummation of the Exchange Offer, the Company and the
Guarantors may allow the Shelf Registration Statement or Market-Maker
Prospectus and the related Registration Statement to cease to become
effective and usable if (A) the board of directors of the Company
determines in good faith that it is in the best interests of the
Company not to disclose the existence of or facts surrounding any
proposed or pending material corporate transaction involving the
Company and the Guarantors, and the Company notifies the Holders within
two business days after the Board of Directors makes such
determination, or (B) the Prospectus contained in the Shelf
Registration Statement or the Market-Maker Prospectus, as the case may
be, contains an untrue statement of the material fact or omits to state
a material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading;
provided that the two-year period referred to in Section 4(a) hereof
during which the Shelf Registration Statement is required to be
effective and usable shall be extended by the number of days during
which such Registration Statement was not effective or usable pursuant
to the foregoing provisions;
(A) subject to Section 6(d)(i), prepare and file with the
Commission such amendments and post-effective amendments to the
Registration Statement as may be necessary to keep the
Registration Statement effective for the applicable period set
forth in Section 3 or 4 hereof, as applicable, or such shorter
period as will terminate when all Transfer Restricted Securities
covered by such Registration Statement have been sold; cause the
Prospectus to be supplemented by any required Prospectus
supplement, and as so supplemented to be filed pursuant to Rule
424 under the Act, and to comply fully with the applicable
provisions of Rules 424 and 430A under the Act in a timely manner;
and comply with the provisions of the Act with respect to the
disposition of all securities covered by such Registration
Statement during the applicable period in accordance with the
intended method or methods of distribution
10
by the sellers thereof set forth in such Registration Statement or
supplement to the Prospectus.
(ii) advise the underwriter(s), if any, and selling Holders of
Transfer Restricted Securities and, following the Consummation of the
Exchange Offer, Holders of Broker Dealer Transfer Restricted
Securities, promptly and, if requested by such Persons, to confirm such
advice in writing, (A) when the Prospectus or any Prospectus supplement
or post-effective amendment has been filed, and, with respect to any
Registration Statement or any post-effective amendment thereto, when
the same has become effective, (B) of any request by the Commission for
amendments to the Registration Statement or amendments or supplements
to the Prospectus or for additional information relating thereto, (C)
of the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement under the Act or of the
suspension by any state securities commission of the qualification of
the Transfer Restricted Securities or Broker-Dealer Transfer Restricted
Securities, as applicable, for offering or sale in any jurisdiction, or
the initiation of any proceeding for any of the preceding purposes and
(D) of the existence of any fact or the happening of any event that
makes any statement of a material fact made in the Registration
Statement, the Prospectus, any amendment or supplement thereto, or any
document incorporated by reference therein untrue, or that requires the
making of any additions to or changes in the Registration Statement or
the Prospectus in order to make the statements therein not misleading.
If at any time the Commission shall issue any stop order suspending the
effectiveness of the Registration Statement, or any state securities
commission or other regulatory authority shall issue an order
suspending the qualification or exemption from qualification of the
Transfer Restricted Securities or Broker-Dealer Transfer Restricted
Securities, as applicable, under state securities or Blue Sky laws, the
Company and the Guarantors shall use all commercially reasonable
efforts to obtain the withdrawal or lifting of such order at the
earliest possible time;
(iii) upon written request, furnish to each of the selling
Holders of Transfer Restricted Securities or Holders of Broker-Dealer
Transfer-Restricted Securities and each of the underwriter(s), if any,
before filing with the Commission, copies of any Registration Statement
or any Prospectus included therein or any amendments or supplements to
any such Registration Statement or Prospectus (including all documents
incorporated by reference after the initial filing of such Registration
Statement), which documents will be subject to the review of such
Holders and underwriter(s), if any, for a period of at least five
business days, and the Company and the Guarantors will not file any
such Registration Statement or Prospectus or any amendment or
supplement to any such Registration Statement or Prospectus (including
all such documents incorporated by reference) if a selling Holder of
Transfer Restricted Securities or a Holder of Broker-Dealer Transfer
Restricted Securities, as applicable, covered by such Registration
Statement or the underwriter(s), if any, shall reasonably object within
5 business days after receipt thereof;
(iv) upon written request, promptly prior to the filing of any
document that is to be incorporated by reference into a Registration
Statement or Prospectus, provide copies of such document to the selling
Holders or the Holders of Broker-Dealer Transfer Restricted Securities,
as applicable, and to the underwriter(s), if any, make the
11
Company's and the Guarantors' representatives available for discussion
of such document and other customary due diligence matters, and include
such information in such document prior to the filing thereof as such
selling Holders or the Holders of Broker-Dealer Transfer Restricted
Securities, as applicable, or underwriter(s), if any, reasonably may
request;
(v) in the case of a Shelf Registration Statement, make
available at reasonable times at the Company's principal place of
business for inspection by the selling Holders of Transfer Restricted
Securities, any underwriter participating in any disposition pursuant
to such Registration Statement, and any attorney or accountant retained
by such selling Holders or any of the underwriter(s) who shall certify
to the Company and the Guarantors that they have a current intention to
sell Transfer Restricted Securities or Broker-Dealer Transfer
Restricted Securities pursuant to a Shelf Registration Statement or
Market-Maker Prospectus, and, following the Consummation of the
Exchange Offer, the Holders of Broker-Dealer Transfer Restricted
Securities, such financial and other information of the Company and the
Guarantors as reasonably requested and cause the Company's and the
Guarantors' officers, directors and employees to respond to such
inquiries as shall be reasonably necessary, in the reasonable judgment
of counsel to such Holders, to conduct a reasonable investigation;
provided, however, that each such party shall be required to maintain
in confidence and not to disclose to any other person any information
or records reasonably designated by the Company in writing as being
confidential, until such time as (A) such information becomes a matter
of public record (whether by virtue of its inclusion in such
Registration Statement or otherwise), or (B) such person shall be
required so to disclose such information pursuant to the subpoena or
order of any court or other governmental agency or body having
jurisdiction over the matter (subject to the requirements of such
order, and only after such person shall have given the Company prompt
prior written notice of such requirement), or (C) such information is
required to be set forth in such Registration Statement or the
Prospectus included therein or in an amendment to such Registration
Statement or an amendment or supplement to such Prospectus in order
that such Registration Statement, Prospectus, amendment or supplement,
as the case may be, does not contain an untrue statement of a material
fact or omit to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading;
(vi) if requested by any selling Holders of Transfer
Restricted Securities or Holders of Broker-Dealer Transfer Restricted
Securities, as applicable, or the underwriter(s), if any, promptly
incorporate in any Registration Statement or Prospectus, pursuant to a
supplement or post-effective amendment if necessary, such information
as such selling Holders and underwriter(s), if any, may reasonably
request to have included therein, including, without limitation,
information relating to the "Plan of Distribution" of the Transfer
Restricted Securities or Broker-Dealer Transfer Restricted Securities,
as applicable, information with respect to the principal amount of
Transfer Restricted Securities or Broker-Dealer Transfer Restricted
Securities, as applicable, being sold to such underwriter(s), the
purchase price being paid therefor and any other terms of the offering
of the Transfer Restricted Securities or Broker-Dealer
Transfer-Restricted Securities, as applicable, to be sold in such
offering; and make all required filings of such Prospectus supplement
or post-effective amendment as soon as practicable after the
12
Company is notified of the matters to be incorporated in such
Prospectus supplement or post-effective amendment;
(vii) furnish to each selling Holder of Transfer Restricted
Securities or Holders of Broker-Dealer Transfer Restricted Securities,
as applicable, and each of the underwriter(s), if any, without charge,
at least one copy of the Registration Statement, as first filed with
the Commission, and of each amendment thereto, including all documents
incorporated by reference therein and all exhibits (including exhibits
incorporated therein by reference);
(viii) deliver to each selling Holder of Transfer Restricted
Securities and each of the underwriter(s), if any, and each Holder of
Broker-Dealer Transfer Restricted Securities, without charge, as many
copies of the Prospectus (including each preliminary prospectus) and
any amendment or supplement thereto as such Persons reasonably may
request; the Company and the Guarantors hereby consent to the use of
the Prospectus and any amendment or supplement thereto by each of the
selling Holders and each of the underwriter(s), if any, and each Holder
of Broker-Dealer Transfer Restricted Securities, in connection with the
offering and the sale of the Transfer Restricted Securities and
Broker-Dealer Transfer Restricted Securities, as applicable, covered by
the Prospectus or any amendment or supplement thereto;
(ix) enter into such agreements (including an underwriting
agreement), and make such representations and warranties, and take all
such other actions in connection therewith in order to expedite or
facilitate the disposition of the Transfer Restricted Securities and
Broker-Dealer Transfer Restricted Securities, as applicable, pursuant
to any Registration Statement contemplated by this Agreement, all to
such extent as may be requested by the Initial Purchaser or, in the
case of registration for resale of Transfer Restricted Securities
pursuant to the Shelf Registration Statement, by any Holder or Holders
of Transfer Restricted Securities who hold at least 25% in aggregate
principal amount of such class of Transfer Restricted Securities or, in
the case of Broker-Dealer Transfer Restricted Securities, by any Holder
of Broker-Dealer Transfer Restricted Securities; provided, that, the
Company and the Guarantors shall not be required to enter into any such
agreement more than once with respect to all of the Transfer Restricted
Securities and, in the case of a Shelf Registration Statement, may
delay entering into such agreement if the Board of Directors of the
Company determines in good faith that it is in the best interests of
the Company and the Guarantors not to disclose the existence of or
facts surrounding any proposed or pending material corporate
transaction involving the Company and the Guarantors; and whether or
not an underwriting agreement is entered into and whether or not the
registration is an Underwritten Registration, the Company and the
Guarantors shall:
(A) furnish to the Initial Purchasers, the Holders of
Transfer Restricted Securities who hold at least 25% in aggregate
principal amount of such class of Transfer Restricted Securities
(in the case of a Shelf Registration Statement), each Holder of
Broker-Dealer Transfer Restricted Securities and each underwriter,
if any, in such substance and scope as they may request and as are
customarily made in connection with an offering of debt securities
pursuant to a Registration Statement (i)
13
upon the effective date of any Registration Statement (and if such
Registration Statement contemplates an Underwritten Offering of
Transfer Restricted Securities or Broker-Dealer Transfer
Restricted Securities, as applicable, upon the date of the closing
under the underwriting agreement related thereto) and (ii) upon
the filing of any amendment or supplement to any Registration
Statement or any other document that is incorporated in any
Registration Statement by reference and includes financial data
with respect to a fiscal quarter or year:
(1) a certificate, dated the date of effectiveness of
the Shelf Registration Statement signed by (y) the respective
Chairman of the Board, the respective President or any Vice
President and (z) the respective Chief Financial Officer of
the Company and each of the Guarantors confirming, as of the
date thereof, the matters set forth in paragraph (j) of
Section 7 of the Purchase Agreement and such other matters as
such parties may reasonably request;
(2) an opinion, dated the date of effectiveness of
the Shelf Registration Statement, as the case may be, of
counsel for the Company covering the matters set forth in
paragraphs (c) (d) and (e) of Section 7 of the Purchase
Agreement and such other matter as such parties may reasonably
request, and in any event including a statement to the effect
that such counsel has participated in conferences with
officers and other representatives of the Company,
representatives of the independent public accountants for the
Company, the Initial Purchasers' representatives and the
Initial Purchasers' counsel in connection with the preparation
of such Registration Statement and the related Prospectus and
have considered the matters required to be stated therein and
the statements contained therein, although such counsel has
not independently verified the accuracy, completeness or
fairness of such statements; and that such counsel advises
that, on the basis of the foregoing (relying as to materiality
to a large extent upon facts provided to such counsel by
officers and other representatives of the Company and without
independent check or verification), no facts came to such
counsel's attention that caused such counsel to believe that
the applicable Registration Statement, at the time such
Registration Statement or any post-effective amendment thereto
became effective, and, in the case of the Exchange Offer
Registration Statement, as of the date of Consummation,
contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or
necessary to make the statements therein not misleading, or
that the Prospectus contained in such Registration Statement
as of its date and, in the case of the opinion dated the date
of Consummation of the Exchange Offer, as of the date of
Consummation, contained an untrue statement of a material fact
or omitted to state a material fact necessary in order to make
the statements therein, in light of the circumstances under
which they were made, not misleading. Such counsel may state
further that such counsel assumes no responsibility for, and
has not independently verified, the accuracy, completeness or
fairness of the financial statements, notes and schedules and
other financial data included in any Registration Statement
contemplated by this Agreement or the related Prospectus; and
14
(3) a customary comfort letter, dated as of the date
of Consummation of the Exchange Offer or the date of
effectiveness of the Shelf Registration Statement, as the case
may be, from the Company's independent accountants, in the
customary form and covering matters of the type customarily
covered in comfort letters by underwriters in connection with
primary underwritten offerings, and affirming the matters set
forth in the comfort letters delivered pursuant to Section 7
of the Purchase Agreement, without exception;
(B) set forth in full or incorporated by reference in the
underwriting agreement, if any, the indemnification provisions and
procedures of Section 8 hereof with respect to all parties to be
indemnified pursuant to said Section; and
(C) deliver such other documents and certificates as may be
reasonably requested by such parties to evidence compliance with
clause (A) above and with any customary conditions contained in
the underwriting agreement or other agreement entered into by the
Company and the Guarantors pursuant to this clause (x), if any.
(x) prior to any public offering of Transfer Restricted
Securities, or Broker-Dealer Transfer Restricted Securities, as
applicable, cooperate with the selling Holders of Transfer Restricted
Securities, the Holders of Broker-Dealer Transfer Restricted
Securities, the underwriter(s), if any, and their respective counsel in
connection with the registration and qualification of the Transfer
Restricted Securities or Broker-Dealer Transfer Restricted Securities,
as applicable, under the securities or Blue Sky laws of such
jurisdictions as the selling Holders of Transfer Restricted Securities
or Holders of Broker-Dealer Transfer Restricted Securities or
underwriter(s) may reasonably request and do any and all other acts or
things necessary or advisable to enable the disposition in such
jurisdictions of the Transfer Restricted Securities or Broker-Dealer
Transfer Restricted Securities, as applicable, covered by the Shelf
Registration Statement filed pursuant to Section 4 hereof; provided,
however, that the Company and the Guarantors shall not be required to
register or qualify as a foreign corporation where it is not now so
qualified or to take any action that would subject it to the service of
process in suits or to taxation, other than as to matters and
transactions relating to the Registration Statement, in any
jurisdiction where it is not now so subject;
(xi) shall issue, upon the request of any Holder of Series A
Notes covered by the Shelf Registration Statement, Series B Notes,
having an aggregate principal amount equal to the aggregate principal
amount of Series A Notes surrendered to the Company by such Holder in
exchange therefor or being sold by such Holder; such Series B Notes to
be registered in the name of such Holder or in the name of the
purchaser(s) of such Notes, as the case may be; in return, the Series A
Notes held by such Holder shall be surrendered to the Company for
cancellation;
(xii) cooperate with the selling Holders of Transfer
Restricted Securities and the underwriter(s), if any, to facilitate the
timely preparation and delivery of certificates representing Transfer
Restricted Securities to be sold and not bearing any restrictive
legends; and enable such Transfer Restricted Securities to be in such
denominations and registered in such names as the Holders or the
underwriter(s), if any, may request at least
15
two business days prior to any sale of Transfer Restricted Securities
made by such underwriter(s);
(xiii) use all commercially resonable efforts to cause the
Transfer Restricted Securities or Broker-Dealer Transfer Restricted
Securities, as applicable, covered by the Registration Statement to be
registered with or approved by such other governmental agencies or
authorities as may be necessary to enable the seller or sellers thereof
or the underwriter(s), if any, to consummate the disposition of such
Transfer Restricted Securities, subject to the proviso contained in
clause (xi) above;
(xiv) subject to clause (d)(i) above, if any fact or event
contemplated by clause (d)(iii)(D) above shall exist or have occurred,
prepare a supplement or post-effective amendment to the Registration
Statement or related Prospectus or any document incorporated therein by
reference or file any other required document so that, as thereafter
delivered to the purchasers of Transfer Restricted Securities, or
Broker-Dealer Transfer Restricted Securities, as applicable, the
Prospectus will not contain an untrue statement of a material fact or
omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading;
(xv) provide a CUSIP number for all Transfer Restricted
Securities not later than the effective date of the Registration
Statement and provide the Trustee under the Indenture with printed
certificates for the Transfer Restricted Securities which are in a form
eligible for deposit with The Depository Trust Company;
(xvi) cooperate and assist in any filings required to be made
with the NASD and in the performance of any due diligence investigation
by any underwriter (including any "qualified independent underwriter")
that is required to be retained in accordance with the rules and
regulations of the NASD;
(xvii) otherwise use all commercially reasonable efforts to
comply with all applicable rules and regulations of the Commission, and
make generally available to its security holders, as soon as
practicable, a consolidated earnings statement meeting the requirements
of Rule 158 (which need not be audited) for the twelve-month period (A)
commencing at the end of any fiscal quarter in which Transfer
Restricted Securities are sold to underwriters in a firm or best
efforts Underwritten Offering or (B) if not sold to underwriters in
such an offering, beginning with the first month of the Company's first
fiscal quarter commencing after the effective date of the Registration
Statement;
(xviii) cause the Indenture to be qualified under the TIA not
later than the effective date of the first Registration Statement
required by this Agreement, and, in connection therewith, cooperate
with the Trustee and the Holders of Notes to effect such changes to the
Indenture as may be required for such Indenture to be so qualified in
accordance with the terms of the TIA; and execute, and use all
commercially reasonable efforts to cause the Trustee to execute, all
documents that may be required to effect such changes and all other
forms and documents required to be filed with the Commission to enable
such Indenture to be so qualified in a timely manner;
16
(xix) provide promptly to each Holder upon request each
document filed with the Commission pursuant to the requirements of
Section 13 and Section 15 of the Exchange Act; and
(xx) cause each Additional Guarantor upon the creation or
acquisition by the Company of such Additional Guarantor, to execute a
counterpart to this Agreement in the form attached hereto as Annex A
and to deliver such counterpart, together with an opinion of counsel as
to the enforceability thereof against such entity, to the Initial
Purchasers no later than five business days following the execution
thereof.
Each Holder agrees by acquisition of a Transfer Restricted Security or
Broker-Dealer Transfer Restricted Securities, as applicable, that, upon receipt
of any notice from the Company of the existence of any fact of the kind
described in Section 6(d)(iii)(D) hereof, such Holder will forthwith discontinue
disposition and will use its reasonable best efforts to cause any underwriter to
forthwith discontinue disposition of Transfer Restricted Securities or
Broker-Dealer Transfer Restricted Security pursuant to the applicable
Registration Statement until such Holder's receipt of the copies of the
supplemented or amended Prospectus contemplated by Section 6(d)(xv) hereof, or
until it is advised in writing (the "Advice") by the Company that the use of the
Prospectus may be resumed, and has received copies of any additional or
supplemental filings that are incorporated by reference in the Prospectus. If so
directed by the Company, each Holder will deliver to the Company (at the
Company's expense) all copies, other than permanent file copies then in such
Holder's possession, of the Prospectus covering such Transfer Restricted
Securities or Broker-Dealer Transfer Restricted Security, as applicable, that
was current at the time of receipt of such notice. In the event the Company
shall give any such notice, the time period regarding the effectiveness of such
Registration Statement set forth in Section 3 or 4 hereof, as applicable, shall
be extended by the number of days during the period from and including the date
of the giving of such notice pursuant to Section 6(d)(iii)(D) hereof to and
including the date when each selling Holder covered by such Registration
Statement shall have received the copies of the supplemented or amended
Prospectus contemplated by Section 6(d)(xv) hereof or shall have received the
Advice.
The Company and the Guarantors may require each Holder of Transfer
Restricted Securities or Broker-Dealer Transfer Restricted Securities as to
which any registration is being effected to furnish to the Company such
information regarding such Holder and such Holder's intended method of
distribution of the applicable Transfer Restricted Securities or Broker-Dealer
Transfer Restricted Securities as the Company may from time to time reasonably
request in writing, but only to the extent that such information is required in
order to comply with the Act. Each such Holder agrees to notify the Company as
promptly as practicable of (i) any inaccuracy or change in information
previously furnished by such Holder to the Company or (ii) the occurrence of any
event, in either case, as a result of which any Prospectus relating to such
registration contains or would contain an untrue statement of a material fact
regarding such Holder or such Holder's intended method of distribution of the
applicable Transfer Restricted Securities or Broker-Dealer Transfer Restricted
Securities or omits to state any material fact regarding such Holder or such
Holder's intended method of distribution of the applicable Transfer Restricted
Securities or Broker-Dealer Transfer Restricted Securities required to be stated
therein or necessary to make the statements therein not misleading and promptly
to furnish to the Company any additional information required to correct and
update any previously furnish
17
to the Company any additional information required to correct and update any
previously furnished information or required so that such Prospectus shall not
contain, with respect to such Holder or the distribution of the applicable
Transfer Restricted Securities or Broker-Dealer Transfer Restricted Securities
an untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not misleading.
SECTION 7 REGISTRATION EXPENSES
All expenses incident to the Company's and the Guarantors' performance
of or compliance with this Agreement will be borne by the Company regardless of
whether a Registration Statement becomes effective, including without
limitation: (i) all registration and filing fees and expenses (including filings
made by any Initial Purchaser or Holder with the NASD (and, if applicable, the
fees and expenses of any "qualified independent underwriter" and its counsel
that may be required by the rules and regulations of the NASD)); (ii) all fees
and expenses of compliance with federal securities and state Blue Sky or
securities laws; (iii) all expenses of printing (including printing certificates
for the Series B Notes to be issued in the Exchange Offer and printing of
Prospectuses), messenger and delivery services; (iv) all fees and disbursements
of counsel for the Company and the Guarantors and the Holders of Transfer
Restricted Securities; and (v) all fees and disbursements of independent
certified public accountants of the Company (including the expenses of any
special audit and comfort letters required by or incident to such performance).
The Company will, in any event, bear its and the Guarantors' internal
expenses (including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties), the expenses of
any annual audit and the fees and expenses of any Person, including special
experts, retained by the Company or the Guarantors.
SECTION 8 INDEMNIFICATION
(a) The Company and the Guarantors shall, jointly and severally,
indemnify and hold harmless each Holder of Transfer Restricted Securities or
Broker Dealer Transfer Restricted Securities, its officers and employees and
each person, if any, who controls any such Holders, within the meaning of the
Securities Act, from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof (including, but not limited to, any
loss, claim, damage, liability or action relating to purchases, sales and
registration of Notes), to which that Holder, officer, employee or controlling
person may become subject, under the Securities Act or otherwise, insofar as
such loss, claim, damage, liability or action arises out of, or is based upon,
(i) any untrue statement or alleged untrue statement of a material fact
contained (A) in any Registration Statement or Prospectus or in any amendment or
supplement thereto or (B) in any blue sky application or other document prepared
or executed by the Company or any Guarantor (or based upon any written
information furnished by the Company or any Guarantor) specifically for the
purpose of qualifying any or all of the Notes under the securities laws of any
state or other jurisdiction (any such application, document or information being
hereinafter called a "Blue Sky Application"), (ii) the omission or alleged
omission to state in any Registration Statement or Prospectus, or in any
amendment or supplement thereto, or in any Blue Sky Application any material
fact required to be stated therein or necessary to make the statements therein
not misleading or (iii) any act or failure to act or any alleged act or failure
to act by any
18
Holder in connection with, or relating in any manner to, the Notes or the
offering contemplated hereby, and which is included as part of or referred to in
any loss, claim, damage, liability or action arising out of or based upon
matters covered by clause (i) or (ii) above (provided that the Company and the
Guarantors shall not be liable under this clause (iii) to the extent that it is
determined in a final judgment by a court of competent jurisdiction that such
loss, claim, damage, liability or action resulted directly from any such acts or
failures to act undertaken or omitted to be taken by such Holder through its
gross negligence or willful misconduct), and shall reimburse each Holder and
each such officer, employee or controlling person promptly upon demand for any
legal or other expenses reasonably incurred by that Holder, officer, employee or
controlling person in connection with investigating or defending or preparing to
defend against any such loss, claim, damage, liability or action as such
expenses are incurred; provided, however, that the Company and the Guarantors
shall not be liable in any such case to the extent that any such loss, claim,
damage, liability or action arises out of, or is based upon, any untrue
statement or alleged untrue statement or omission or alleged omission made in
any Registration Statement or Prospectus, or in any such amendment or
supplement, or in any Blue Sky Application, in reliance upon and in conformity
with written information concerning such Holder furnished to the Company by or
on behalf of any Holder specifically for inclusion therein. The foregoing
indemnity agreement is in addition to any liability which the Company and the
Guarantors may otherwise have to any Holder or to any officer, employee or
controlling person of that Holder.
(b) Each Holder, severally and not jointly, shall indemnify and hold
harmless the Company and the Guarantors, their respective officers and
employees, each of their respective directors, and each person, if any, who
controls the Company or the Guarantors within the meaning of the Securities Act,
from and against any loss, claim, damage or liability, joint or several, or any
action in respect thereof, to which the Company, the Guarantors or any such
director, officer or controlling person may become subject, under the Securities
Act or otherwise, insofar as such loss, claim, damage, liability or action
arises out of, or is based upon, (i) any untrue statement or alleged untrue
statement of a material fact contained (A) in any Registration Statement or
Prospectus, or in any amendment or supplement thereto, or (B) in any Blue Sky
Application or (ii) the omission or alleged omission to state in any
Registration Statement or Prospectus, or in any amendment or supplement thereto,
or in any Blue Sky Application any material fact required to be stated therein
or necessary to make the statements therein not misleading, but in each case
only to the extent that the untrue statement or alleged untrue statement or
omission or alleged omission was made in reliance upon and in conformity with
written information concerning such Holders furnished to the Company by or on
behalf of that Holder specifically for inclusion therein, and shall reimburse
the Company, the Guarantors and any such director, officer or controlling person
for any legal or other expenses reasonably incurred by the Company, the
Guarantors or any such director, officer or controlling person in connection
with investigating or defending or preparing to defend against any such loss,
claim, damage, liability or action as such expenses are incurred. The foregoing
indemnity agreement is in addition to any liability which any Holder may
otherwise have to the Company, the Guarantors or any such director, officer,
employee or controlling person. The Company and the Guarantors shall be entitled
to receive indemnities from underwriters, selling brokers, dealer managers and
similar securities industry professionals participating in the distribution of
such Registrable Securities to the same extent as provided above with respect to
information or
19
affidavit furnished in writing by such Persons as provided specifically for in
any Prospectus or Registration Statement.
(c) Promptly after receipt by an indemnified party under this Section 8
of notice of any claim or the commencement of any action, the indemnified party
shall, if a claim in respect thereof is to be made against the indemnifying
party under this Section 8, notify the indemnifying party in writing of the
claim or the commencement of that action; provided, however, that the failure to
notify the indemnifying party shall not relieve it from any liability which it
may have under this Section 8 except to the extent it has been materially
prejudiced by such failure and, provided further, that the failure to notify the
indemnifying party shall not relieve it from any liability which it may have to
an indemnified party otherwise than under this Section 8. If any such claim or
action shall be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 8 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than reasonable costs of investigation; provided, however, any
indemnified party shall have the right to employ separate counsel in any such
action and to participate in the defense thereof but the fees and expenses of
such counsel shall be at the expense of the indemnified party unless (i) the
employment thereof has been specifically authorized by the indemnifying party in
writing, (ii) such indemnified party shall have been advised by such counsel
that there may be one or more legal defenses available to it which are different
from or additional to those available to the indemnifying party and in the
reasonable judgment of such counsel it is advisable for such indemnified party
to employ separate counsel or (iii) the indemnifying party has failed to assume
the defense of such action and employ counsel reasonably satisfactory to the
indemnified party, in which case, if such indemnified party notifies the
indemnifying party in writing that it elects to employ separate counsel at the
expense of the indemnifying party shall not, in connection with any one such
action or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one separate firm of
attorneys (in addition to one local counsel) at any time for all such
indemnified parties, if the indemnified parties under this Section 8 consist of
any Initial Purchaser or any of their respective officers, employees or
controlling persons, or by the Company, if the indemnified parties under this
Section consist of the Company, the Guarantors or any of their respective
directors, officers, employees or controlling persons. No indemnifying party
shall (i) without the prior written consent of the indemnified parties (which
consent shall not be unreasonably withheld), settle or compromise or consent to
the entry of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified parties are actual or
potential parties to such claim or action) unless such settlement, compromise or
consent includes an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding, or (ii) be
liable for any settlement of any such action effected without its written
consent (which consent shall not be unreasonably withheld), but if settled with
the consent of the indemnifying party or if there be a final judgment of the
plaintiff in any such action, the indemnifying party agrees to indemnify and
hold harmless any
20
indemnified party from and against any loss or liability by reason of such
settlement or judgment.
(d) If the indemnification provided for in this Section 8 shall for any
reason be unavailable to or insufficient to hold harmless an indemnified party
under Section 8(a) or 8(b) in respect of any loss, claim, damage or liability,
or any action in respect thereof, referred to therein, then each indemnifying
party shall, in lieu of indemnifying such indemnified party, contribute to the
amount paid or payable by such indemnified party as a result of such loss,
claim, damage or liability, or action in respect thereof, (i) in such proportion
as shall be appropriate to reflect the relative benefits received by the Company
and the Guarantors, on the one hand, and the Holders on the other, from the
offering of the Notes or (ii) if the allocation provided by clause (i) above is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause (i) above but also the
relative fault of the Company and the Guarantors, on the one hand and the
Holders on the other with respect to the statements or omissions which resulted
in such loss, claim, damage or liability, or action in respect thereof, as well
as any other relevant equitable considerations. The relative benefits received
by the Company and the Guarantors, on the one hand and the Holders on the other
with respect to such offering shall be deemed to be in the same proportion as
the total net proceeds from the offering of the Series A Notes purchased under
the Purchase Agreement (before deducting expenses) received by the Company and
the Guarantors, on the one hand, and the total discounts and commissions
received by the Holders with respect to the Series A Notes purchased under this
Agreement, on the other hand, bear to the total gross proceeds from the offering
of the Series A Notes under the Purchase Agreement, in each case as set forth in
the table on the cover page of the Offering Memorandum. The relative fault shall
be determined by reference to whether the untrue or alleged untrue statement of
a material fact or omission or alleged omission to state a material fact relates
to information supplied by the Company, the Guarantors or the Holders, the
intent of the parties and their relative knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company, the
Guarantors and the Holders agree that it would not be just and equitable if
contributions pursuant to this Section 8(d) were to be determined by pro rata
allocation (even if the Holders were treated as one entity for such purpose) or
by any other method of allocation which does not take into account the equitable
considerations referred to herein. The amount paid or payable by an indemnified
party as a result of the loss, claim, damage or liability, or action in respect
thereof, referred to above in this Section shall be deemed to include, for
purposes of this Section 8(d), any legal or other expenses reasonably incurred
by such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 8(d), no Holder
shall be required to contribute any amount in excess of the amount by which the
net proceeds received by it in connection with its sale of Notes exceeds the
amount of any damages which such Holder has otherwise paid or become liable to
pay by reason of any untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The Holders'
obligations to contribute as provided in this Section 8(d) are several and not
joint.
21
SECTION 9 RULE 144A
The Company and each Guarantor hereby agrees with each Holder of
Transfer Restricted Securities, during any period in which the Company or such
Guarantor is not subject to Section 13 or 15(d) of the Exchange Act within the
two-year period following the Closing Date, and each Holder of Broker-Dealer
Transfer Restricted Securities, for so long as any Broker-Dealer Transfer
Restricted Securities remain outstanding, to make available to any Holder or
beneficial owner of Transfer Restricted Securities or any Holder or
Broker-Dealer Transfer Restricted Securities, in connection with any sale
thereof and any prospective purchaser of such Transfer Restricted Securities
from such Holder or beneficial owner, the information required by Rule
144A(d)(4) under the Act in order to permit resales of such Transfer Restricted
Securities pursuant to Rule 144A.
SECTION 10 PARTICIPATION IN UNDERWRITTEN REGISTRATIONS
No Holder may participate in any Underwritten Registration hereunder
unless such Holder (a) agrees to sell such Holder's Transfer Restricted
Securities or Broker-Dealer Transfer Restricted Securities, as applicable, on
the basis provided in any underwriting arrangements approved by the Persons
entitled hereunder to approve such arrangements and (b) completes and executes
all reasonable questionnaires, powers of attorney, indemnities, underwriting
agreements, lock-up letters and other documents required under the terms of such
underwriting arrangements.
SECTION 11 SELECTION OF UNDERWRITERS
The Holders of Transfer Restricted Securities covered by the Shelf
Registration Statement who desire to do so may sell such Transfer Restricted
Securities in an Underwritten Offering at such Holders' expense. In any such
Underwritten Offering, the investment banker or investment bankers and manager
or managers that will administer the offering will be selected by the Holders of
a majority in aggregate principal amount of the Transfer Restricted Securities
included in such offering; provided, that such investment bankers and managers
must be reasonably satisfactory to the Company.
SECTION 12 MISCELLANEOUS
(a) Remedies. The Company and the Guarantors agree that monetary
damages (including the additional amounts contemplated hereby) would not be
adequate compensation for any loss incurred by reason of a breach by it of the
provisions of this Agreement and hereby agree to waive the defense in any action
for specific performance that a remedy at law would be adequate.
(b) No Inconsistent Agreements. Neither the Company nor any Guarantor
will, on or after the date of this Agreement, enter into any agreement with
respect to its securities that is inconsistent with the rights granted to the
Holders in this Agreement or otherwise conflicts with the provisions hereof.
Except as disclosed in the Offering Memorandum or in the documents incorporated
therein by reference, neither the Company nor any Guarantor has previously
entered into any agreement granting any registration rights with respect to its
securities to any Person. The rights granted to the Holders hereunder do not in
any way conflict with and are not
22
inconsistent with the rights granted to the holders of the Company's or any
Guarantor's securities under any agreement in effect on the date hereof.
(c) Adjustments Affecting the Notes. The Company and the Guarantors
will not take any action, or permit any change to occur, with respect to the
Notes that would materially and adversely affect the ability of the Holders to
Consummate any Exchange Offer.
(d) Amendments and Waivers. The provisions of this Agreement may not be
amended, modified or supplemented, and waivers or consents to or departures from
the provisions hereof may not be given unless the Company has obtained the
written consent of Holders of a majority of the outstanding principal amount of
Transfer Restricted Securities. Notwithstanding the foregoing, a waiver or
consent to departure from the provisions hereof that relates exclusively to the
rights of Holders whose securities are being tendered pursuant to the Exchange
Offer and that does not affect directly or indirectly the rights of other
Holders whose securities are not being tendered pursuant to such Exchange Offer
may be given by the Holders of a majority of the outstanding principal amount of
Transfer Restricted Securities being tendered or registered.
(e) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail
(registered or certified, return receipt requested), telex, telecopier, or air
courier guaranteeing overnight delivery:
(i) if to a Holder, at the address set forth on the records of
the Registrar under the Indenture, with a copy to the Registrar under
the Indenture; and
(ii) if to the Company or the Guarantors:
L-3 Communications Corporation
000 Xxxxx Xxxxxx, 00xx Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxxxxxxxxx X. Xxxxxxx (Fax: 000-000-0000),
With a copy to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX, 00000
Attention: Xxxxxxx Xxxxxx Xx. (Fax: 000-000-0000)
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five business
days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if telexed; when receipt acknowledged, if telecopied; and on the
next business day, if timely delivered to an air courier guaranteeing overnight
delivery.
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address specified in the Indenture.
(f) Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the successors and assigns of each of the parties,
including without limitation and without
23
the need for an express assignment, subsequent Holders or Restricted Broker
Dealers; provided, however, that this Agreement shall not inure to the benefit
of or be binding upon a successor or assign of a Holder unless and to the extent
such successor or assign acquired Transfer Restricted Securities or Broker
Dealer Transfer Restricted Securities from such Holder.
(g) 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.
(h) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
(j) Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
(k) Entire Agreement. This Agreement together with the other Operative
Documents (as defined in the Purchase Agreement) is intended by the parties as a
final expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein
with respect to the registration rights granted by the Company and the
Guarantors with respect to the Transfer Restricted Securities. This Agreement
supersedes all prior agreements and understandings between the parties with
respect to such subject matter.
[Signature pages follow]
24
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
L-3 COMMUNICATIONS CORPORATION
By: /s/ Xxxxxxxxxxx X. Xxxxxxx
--------------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxx
Title: Senior Vice President, Secretary and
General Counsel
GUARANTORS:
AMI INSTRUMENTS, INC.
APCOM, INC.
CELERITY SYSTEMS INCORPORATED
XXXXXXX RESEARCH CORPORATION
EER SYSTEMS, INC.
ELECTRODYNAMICS, INC.
XXXXXXXX, INC.
HYGIENETICS ENVIRONMENTAL SERVICES, INC.
INTERSTATE ELECTRONICS CORPORATION
KDI PRECISION PRODUCTS, INC.
L-3 COMMUNICATIONS AIS GP CORPORATION
L-3 COMMUNICATIONS ANALYTICS CORPORATION
L-3 COMMUNICATIONS ATLANTIC SCIENCE & TECHNOLOGY
CORPORATION
L-3 COMMUNICATIONS AYDIN CORPORATION
L-3 COMMUNICATIONS ESSCO, INC.
L-3 COMMUNICATIONS ILEX SYSTEMS, INC.
L-3 COMMUNICATIONS INVESTMENTS, INC.
L-3 COMMUNICATIONS SPD TECHNOLOGIES, INC.
L-3 COMMUNICATIONS STORM CONTROL SYSTEMS, INC.
MICRODYNE COMMUNICATIONS TECHNOLOGY INCORPORATED
MICRODYNE CORPORATION
MICRODYNE OUTSOURCING INCORPORATED
MPRI, INC.
PAC ORD, INC.
POWER PARAGON, INC.
SOUTHERN CALIFORNIA MICROWAVE, INC.
SPD ELECTRICAL SYSTEMS, INC.
SPD HOLDINGS, INC.
SPD SWITCHGEAR, INC.
as Guarantors
By: /s/ Xxxxxxxxxxx X. Xxxxxxx
--------------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxx
Title: Vice President and Secretary
L-3 COMMUNICATIONS INTEGRATED SYSTEMS L.P.
as Guarantor
By: L-3 COMMUNICATIONS AIS GP CORPORATION,
as general partner
By: /s/ Xxxxxxxxxxx X. Xxxxxxx
--------------------------------------------
Name: Xxxxxxxxxxx X. Xxxxxxx
Title: Authorized Person
XXXXXX BROTHERS INC.
BANC OF AMERICA SECURITIES LLC
CREDIT SUISSE FIRST BOSTON
BY XXXXXX BROTHERS INC.
By: /s/ Xxxxx Xxxxx
-------------------------------
Authorized Representative
ANNEX A
COUNTERPART TO REGISTRATION RIGHTS AGREEMENT
The undersigned hereby absolutely, unconditionally and irrevocably
agrees (as a "Guarantor") to use all commercially reasonable efforts to include
its Subsidiary Guarantee in any Registration Statement required to be filed by
the Company and the Guarantors pursuant to the Registration Rights Agreement,
dated as of June 28, 2002, (the "Registration Rights Agreement") by and among
L-3 Communications Corporation, a Delaware corporation, the guarantors party
thereto, Xxxxxx Brothers Inc., Banc of America Securities LLC and Credit Suisse
First Boston Corporation; to use all commercially reasonable efforts to cause
such Registration Statement to become effective as specified in the Registration
Rights Agreement; and to otherwise be bound by the terms and provisions of the
Registration Rights Agreement.
IN WITNESS WHEREOF, the undersigned has executed this Counterpart as of
_____________.
[NAME]
By:
------------------------------
Name:
Title:
A-1
