SENIOR NOTES
REGISTRATION RIGHTS AGREEMENT
DATED AS OF NOVEMBER 26, 1996
AMONG
NEWPORT NEWS SHIPBUILDING INC.,
NEWPORT NEWS SHIPBUILDING AND DRY DOCK COMPANY,
AND
X.X. XXXXXX SECURITIES INC.,
CS FIRST BOSTON CORPORATION,
XXXXXX XXXXXXX & CO. INCORPORATED,
BA SECURITIES, INC.
AND
NATIONSBANC CAPITAL MARKETS, INC.
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is dated as of November
26, 1996, by and among NEWPORT NEWS SHIPBUILDING INC., a Delaware corporation
(the "Company"), NEWPORT NEWS SHIPBUILDING AND DRY DOCK COMPANY, a Virginia
corporation (collectively with each Material Subsidiary, whether formed or
acquired after the Closing Date, that becomes a guarantor under the Indenture,
the "Guarantors"), and X.X. XXXXXX SECURITIES INC., CS FIRST BOSTON
CORPORATION, XXXXXX XXXXXXX & CO. INCORPORATED, BA SECURITIES, INC. and
NATIONSBANC CAPITAL MARKETS, INC. (collectively, the "Initial Purchasers").
This Agreement is entered into in connection with the Purchase Agreement,
dated as of November 21, 1996, among the Company, Newport News Shipbuilding
and Dry Dock Company and the Initial Purchasers (the "Purchase Agreement")
relating to the sale by the Company to the Initial Purchasers of $200,000,000
aggregate principal amount of its 8 5/8% Senior Notes due 2006 (the "Notes").
The Notes have been guaranteed (the "Guarantee") on a senior basis by the
Guarantors. In order to induce the Initial Purchasers to enter into the
Purchase Agreement, the Company and the Guarantors have agreed to provide the
registration rights set forth in this Agreement for the equal benefit of the
Initial Purchasers and their respective direct and indirect transferees. The
execution and delivery of this Agreement is a condition to the Initial
Purchasers' obligation to purchase the Notes under the Purchase Agreement.
The parties hereby agree as follows:
1. DEFINITIONS
As used in this Agreement, the following terms shall have the following
meanings:
Additional Interest: See Section 4.
Advice: See Section 5.
Applicable Period: See Section 2.
Closing Date: The Closing Date as defined in the Purchase Agreement.
Company: See the introductory paragraph to this Agreement.
Effectiveness Date: The 150th day after the Closing Date.
Effectiveness Period: See Section 3.
Event Date: See Section 4.
Exchange Act: The Securities Exchange Act of 1934, as amended, and the rules
and regulations of the SEC promulgated thereunder.
Exchange Offer: See Section 2.
Exchange Registration Statement: See Section 2.
Exchange Securities: See Section 2.
Expiration Date: See Section 2.
Filing Date: The 60th day after the Closing Date.
Guarantees: See the second introductory paragraph to this Agreement.
Guarantors: See the introductory paragraph to this Agreement.
Holder: Any holder of Registrable Securities.
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Indemnified Person: See Section 7.
Indemnifying Person: See Section 7.
Indenture: The Indenture, dated as of November 26, 1996, among the Company,
the Guarantors and The Bank of New York, as trustee, pursuant to which the
Notes are being issued, as amended or supplemented from time to time in
accordance with the terms thereof.
Initial Purchasers: See the introductory paragraph to this Agreement.
Initial Shelf Registration Statement: See Section 3.
Inspectors: See Section 5(p).
Issue Date: The date of original issuance of the Notes.
Material Subsidiary: A Material Subsidiary as defined in the Indenture.
NASD: See Section 5(u).
Notes: See the second introductory paragraph to this Agreement.
Participant: See Section 7.
Participating Broker-Dealer: See Section 2.
Person: An individual, corporation, limited or general partnership, limited
liability company, joint venture, association, joint stock company, trust,
unincorporated organization or government or any agency or political
subdivision thereof.
Private Exchange: See Section 2.
Private Exchange Securities: See Section 2.
Prospectus: The prospectus included in any Registration Statement
(including, without limitation, a prospectus that includes any information
previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 430A promulgated under the
Securities Act), as amended or supplemented by any prospectus supplement, with
respect to the terms of the offering of any portion of the Registrable
Securities covered by such Registration Statement, and all other amendments
and supplements to the Prospectus, including post-effective amendments, and
all material incorporated by reference or deemed to be incorporated by
reference in such Prospectus.
Purchase Agreement: See the second introductory paragraph to this Agreement.
Records: See Section 5(p).
Registrable Securities: The Notes upon original issuance of the Notes and at
all times subsequent thereto, each Exchange Security as to which Section
2(c)(iv) hereof is applicable upon original issuance and at all times
subsequent thereto and, if issued, the Private Exchange Securities, until in
the case of any such Notes, Exchange Securities or Private Exchange
Securities, as the case may be, (i) a Registration Statement (other than, with
respect to any Exchange Security as to which Section 2(c)(iv) hereof is
applicable, the Exchange Offer Registration Statement) covering such Notes,
Exchange Securities or Private Exchange Securities has been declared effective
by the SEC and such Notes, Exchange Securities or Private Exchange Securities,
as the case may be, have been disposed of in accordance with such effective
Registration Statement, (ii) such Notes, Exchange Securities or Private
Exchange Securities, as the case may be, are sold in compliance with Rule 144,
or (iii) such Notes, Exchange Securities or Private Exchange Securities, as
the case may be, cease to be outstanding.
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Registration Statement: Any registration statement of the Company and the
Guarantors, including, but not limited to, the Exchange Offer Registration
Statement, that covers any of the Registrable Securities pursuant to the
provisions of this Agreement, including the Prospectus, amendments and
supplements to such registration statement, including post-effective
amendments, all exhibits, and all material incorporated by reference or deemed
to be incorporated by reference in such registration statement.
Rule 144: Rule 144 promulgated under the Securities Act, as such Rule may be
amended from time to time, or any similar rule (other than Rule 144A) or
regulation hereafter adopted by the SEC providing for offers and sales of
securities made in compliance therewith resulting in offers and sales by
subsequent holders that are not affiliates of an issuer of such securities
being free of the registration and prospectus delivery requirements of the
Securities Act.
Rule 144A: Rule 144A promulgated under the Securities Act, as such Rule may
be amended from time to time, or any similar rule (other than Rule 144) or
regulation hereafter adopted by the SEC.
Rule 415: Rule 415 promulgated under the Securities Act, as such Rule may be
amended from time to time, or any similar rule or regulation hereafter adopted
by the SEC.
SEC: The Securities and Exchange Commission.
Securities Act: The Securities Act of 1933, as amended, and the rules and
regulations of the SEC promulgated thereunder.
Shelf Notice: See Section 2.
Shelf Registration Statement: See Section 3.
Shelf Registration Event: See Section 2(c).
Subsequent Shelf Registration Statement: See Section 3.
TIA: The Trust Indenture Act of 1939, as amended.
Trustee: The trustee under the Indenture and, if existent, the trustee under
any indenture governing the Exchange Securities and Private Exchange
Securities (if any).
Underwritten registration or underwritten offering: A registration in which
securities of the Company are sold to an underwriter for reoffering to the
public.
2. EXCHANGE OFFER
(a) The Company and the Guarantors agree to file with the SEC on or before
the Filing Date, an offer to exchange (the "Exchange Offer") any and all of
the Registrable Securities for a like aggregate principal amount of senior
debt securities of the Company which are substantially identical to the Notes
and guaranteed on a senior basis by the Guarantors with terms identical to the
Guarantees (the "Exchange Securities") (and which are entitled to the benefits
of a trust indenture which is identical to the Indenture (other than such
changes as are necessary to comply with any requirements of the SEC to effect
or maintain the qualification of such trust indenture under the TIA) and which
has been qualified under the TIA), except that the Exchange Securities shall
have been registered pursuant to an effective Registration Statement under the
Securities Act and shall contain no restrictive legend thereon. The Company
and the Guarantors agree to use their respective best efforts to (i) cause the
Exchange Offer Registration Statement to become effective and commence the
Exchange Offer on or prior to the Effectiveness Date, (ii) keep the Exchange
Offer open for 30 days (or longer if required by applicable law) (the last day
of such period, the "Expiration Date") and (iii) exchange Exchange Securities
for all Notes validly tendered and not withdrawn pursuant to the Exchange
Offer on or prior to the 5th day following the Expiration Date. The Exchange
Offer will be registered under the Securities Act on the appropriate form (the
"Exchange Offer Registration Statement") and will comply with all applicable
tender offer rules and regulations under the Exchange Act.
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Each Holder who participates in the Exchange Offer will be deemed to
represent that any Exchange Securities received by it will be acquired in the
ordinary course of its business, that at the time of the consummation of the
Exchange Offer such Holder will have no arrangement with any person to
participate in the distribution of the Exchange Securities in violation of the
provisions of the Securities Act, and that such Holder is not an affiliate of
the Company or the Guarantors within the meaning of the Securities Act.
Upon consummation of the Exchange Offer in accordance with this Section 2,
the provisions of this Agreement shall continue to apply, mutatis mutandis,
solely with respect to Registrable Securities that are Private Exchange
Securities, Exchange Securities to which Section 2(c)(iv) is applicable and
Exchange Securities held by Participating Broker-Dealers, and the Company and
the Guarantors shall have no further obligation to register Registrable
Securities (other than Private Exchange Securities and other than Exchange
Securities as to which Section 2(c)(iv) hereof applies) pursuant to Section 3
of this Agreement. No securities other than the Exchange Securities shall be
included in the Exchange Offer Registration Statement.
(b) The Company and the Guarantors shall include within the Prospectus
contained in the Exchange Offer Registration Statement a section entitled
"Plan of Distribution," reasonably acceptable to the Initial Purchasers, which
shall contain a summary statement of the positions taken or policies made by
the Staff of the SEC with respect to the potential "underwriter" status of any
broker-dealer that is the beneficial owner (as defined in Rule 13d-3 under the
Exchange Act) of Exchange Securities received by such broker-dealer in the
Exchange Offer (a "Participating Broker-Dealer"), whether such positions or
policies have been publicly disseminated by the Staff of the SEC or such
positions or policies, in the reasonable judgment of the Initial Purchasers,
represent the prevailing views of the Staff of the SEC. Such "Plan of
Distribution" section shall also allow the use of the prospectus by all
persons subject to the prospectus delivery requirements of the Securities Act,
including all Participating Broker-Dealers, and include a statement describing
the means by which Participating Broker-Dealers may resell the Exchange
Securities.
The Company and the Guarantors shall use their respective best efforts to
keep the Exchange Offer Registration Statement effective and to amend and
supplement the Prospectus contained therein in order to permit such Prospectus
to be lawfully delivered by all persons subject to the prospectus delivery
requirements of the Securities Act for at least 180 days (or such shorter time
as such persons must comply with such requirements in order to resell the
Exchange Securities) (the "Applicable Period").
If, prior to consummation of the Exchange Offer, any Initial Purchaser holds
any Notes acquired by it and having, or which are reasonably likely to be
determined to have, the status of an unsold allotment in the initial
distribution, the Company upon the request of such Initial Purchaser shall,
simultaneously with the delivery of the Exchange Securities in the Exchange
Offer, issue and deliver to such Initial Purchaser, in exchange (the "Private
Exchange") for the Notes held by such Initial Purchaser, a like principal
amount of debt securities of the Company that are identical to the Exchange
Securities and guaranteed by the Guarantors with terms identical to the
Guarantees (the "Private Exchange Securities") (and which are issued pursuant
to the same indenture as the Exchange Securities). The Private Exchange
Securities shall bear the same CUSIP number as the Exchange Securities.
Interest on the Exchange Securities and Private Exchange Securities will
accrue from the last interest payment date on which interest was paid on the
Notes surrendered in exchange therefor or, if no interest has been paid on the
Notes, from the Issue Date.
Any indenture under which the Exchange Securities or the Private Exchange
Securities will be issued shall provide that the holders of any of the
Exchange Securities and the Private Exchange Securities will vote and consent
together on all matters (to which such holders are entitled to vote or
consent) as one class and that none of the holders of the Exchange Securities
and the Private Exchange Securities will have the right to vote or consent as
a separate class on any matter (to which such holders are entitled to vote or
consent).
(c) If, (i) because of any change in law or in currently prevailing
interpretations of the staff of the SEC, the Company is not permitted to
effect the Exchange Offer, (ii) the Exchange Offer is not commenced on or
prior to
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the Effectiveness Date, (iii) any holder of Private Exchange Securities so
requests, or (iv) in the case of any Holder that participates in the Exchange
Offer, such Holder does not receive Exchange Securities on the date of the
exchange that may be sold without restriction under state and federal
securities laws (the occurrence of any such event, a "Shelf Registration
Event"), then, in the case of each of clauses (i) to and including (iv) of
this sentence, the Company shall promptly deliver to the Holders and the
Trustee notice thereof (the "Shelf Notice") and shall thereafter file an
Initial Shelf Registration Statement pursuant to Section 3.
3. SHELF REGISTRATION
If a Shelf Notice is delivered as contemplated by Section 2(c), then:
(a) Initial Shelf Registration Statement. The Company and the Guarantors
shall promptly prepare and file with the SEC a Registration Statement for
an offering to be made on a continuous basis pursuant to Rule 415 covering
all of the Registrable Securities (the "Initial Shelf Registration
Statement"). If the Company and the Guarantors shall have not yet filed an
Exchange Offer Registration Statement, the Company and the Guarantors shall
use their respective best efforts to file with the SEC the Initial Shelf
Registration Statement on or prior to the Filing Date. Otherwise, the
Company and the Guarantors shall use their respective best efforts to file
with the SEC the Initial Shelf Registration Statement within 60 days of the
Shelf Registration Event. The Initial Shelf Registration Statement shall be
on Form S-1 or another appropriate form including Form S-3, if available,
permitting registration of such Registrable Securities for resale by such
holders in the manner designated by them (including, without limitation, an
underwritten offering). The Company and the Guarantors shall not permit any
securities other than the Registrable Securities to be included in the
Initial Shelf Registration Statement or any Subsequent Shelf Registration
Statement. The Company and the Guarantors shall use their respective best
efforts to cause the Initial Shelf Registration Statement to be declared
effective under the Securities Act on or prior to the later of (A) the
180th day after the Issue Date and (B) the 120th day after the Shelf
Registration Event, and to keep the Initial Shelf Registration Statement
continuously effective under the Securities Act until the date which is 36
months from the Issue Date, or such shorter period ending when (i) all
Registrable Securities covered by the Initial Shelf Registration Statement
have been sold in the manner set forth and as contemplated in the Initial
Shelf Registration Statement or (ii) a Subsequent Shelf Registration
Statement covering all of the Registrable Securities has been declared
effective under the Securities Act (such 36 month or shorter period, the
"Effectiveness Period").
(b) Subsequent Shelf Registration Statement. If the Initial Shelf
Registration Statement or any Subsequent Shelf Registration Statement
ceases to be effective for any reason at any time during the Effectiveness
Period (other than because of the sale of all of the securities registered
thereunder), the Company and the Guarantors shall use their respective best
efforts to obtain the prompt withdrawal of any order suspending the
effectiveness thereof, and in any event the Company and the Guarantor shall
within 45 days of such cessation of effectiveness use their respective best
efforts to amend the Shelf Registration Statement in a manner reasonably
expected to obtain the withdrawal of the order suspending the effectiveness
thereof, or file an additional "shelf" Registration Statement pursuant to
Rule 415 covering all of the Registrable Securities (a "Subsequent Shelf
Registration Statement"). If a Subsequent Shelf Registration Statement is
filed, the Company and the Guarantors shall use their respective best
efforts to cause the Subsequent Shelf Registration Statement to be declared
effective as soon as reasonably practicable after such filing and to keep
such Registration Statement continuously effective until the end of the
Effectiveness Period. As used herein the term "Shelf Registration
Statement" means the Initial Shelf Registration Statement and any
Subsequent Shelf Registration Statement.
(c) Supplements and Amendments. The Company and the Guarantors shall
promptly supplement and amend the Shelf Registration Statement if required
by the rules, regulations or instructions applicable to the registration
form used for such Shelf Registration Statement, if required by the
Securities Act, or if reasonably requested by the Holders of a majority in
aggregate principal amount of the Registrable Securities covered by such
Registration Statement or by any underwriter of such Registrable
Securities.
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4. ADDITIONAL INTEREST
(a) The Company, the Guarantors and the Initial Purchasers agree that the
Holders of Notes will suffer damages if the Company and the Guarantors fail to
fulfill their obligations under Section 2 or Section 3 hereof and that it
would not be feasible to ascertain the extent of such damages with precision.
Accordingly, the Company agrees to pay, as liquidated damages, additional
interest on the Notes ("Additional Interest") under the circumstances and to
the extent set forth below (each of which shall be given independent effect):
(i) if either the Exchange Offer Registration Statement or the Initial
Shelf Registration Statement has not been filed on or prior to the date
required to be filed pursuant to this Agreement, Additional Interest shall
accrue on the Notes over and above the stated interest at a rate of .25%
per annum for the first 90 days immediately following such date, such
Additional Interest rate increasing by an additional .25% per annum at the
beginning of each subsequent 90-day period;
(ii) if either the Exchange Offer Registration Statement or the Initial
Shelf Registration Statement is not declared effective by the SEC on or
prior to the date required to be declared effective pursuant to this
Agreement, Additional Interest shall accrue on the Notes included or which
should have been included in such Registration Statement over and above the
stated interest at a rate of .25% per annum for the first 90 days
immediately following the day after such date, such Additional Interest
rate increasing by an additional .25% per annum at the beginning of each
subsequent 90-day period; and
(iii) if (A) the Company has not exchanged Exchange Securities for all
Notes validly tendered and not withdrawn in accordance with the terms of
the Exchange Offer on or prior to the 5th day after the Expiration Date or
(B) the Exchange Offer Registration Statement ceases to be effective at any
time prior to the Expiration Date or (C) if applicable, the Shelf
Registration Statement has been declared effective and such Shelf
Registration Statement ceases to be effective at any time during the
Effectiveness Period, then Additional Interest shall accrue on the Notes
(over and above any interest otherwise payable on the Notes) at a rate of
.25% per annum for the first 90 days commencing on the (x) 6th day after
the Expiration Date, in the case of (A) above, or (y) the day the Exchange
Offer Registration Statement ceases to be effective in the case of (B)
above, or (z) the day such Shelf Registration Statement ceases to be
effective in the case of (C) above, such Additional Interest rate
increasing by an additional .25% per annum at the beginning of each such
subsequent 90-day period;
provided, however, that the Additional Interest rate on the Notes may not
exceed at any one time in the aggregate 1.0% per annum; and provided, further,
that (1) upon the filing of the Exchange Offer Registration Statement or a
Shelf Registration Statement as required hereunder (in the case of clause (i)
of this Section 4(a)), (2) upon the effectiveness of the Exchange Offer
Registration Statement or the Shelf Registration Statement as required
hereunder (in the case of clause (ii) of this Section 4(a)) or (3) upon the
exchange of Exchange Securities for all Notes validly tendered and not
withdrawn (in the case of clause (iii)(A) of this Section 4(a)), or upon the
effectiveness of the Exchange Offer Registration Statement which had ceased to
remain effective (in the case of (iii)(B) of this Section 4(a)), or upon the
effectiveness of the Shelf Registration Statement which had ceased to remain
effective (in the case of (iii)(C) of this Section 4(a)), Additional Interest
on the Notes as a result of such clause (or the relevant subclause thereof),
as the case may be, shall cease to accrue.
(b) The Company shall notify the Trustee within one business day after each
and every date on which an event occurs in respect of which Additional
Interest is required to be paid (an "Event Date"). The Company shall pay the
Additional Interest due on the Registrable Securities by depositing with the
Trustee, in trust, for the benefit of the Holders thereof, on or before the
applicable semi-annual interest payment date, immediately available funds in
sums sufficient to pay the Additional Interest then due to Holders of
Registrable Securities. The Additional Interest amount due shall be payable on
each interest payment date to the record Holder of Registrable Securities
entitled to receive the interest payment to be made on such date as set forth
in the Indenture. Each obligation to pay Additional Interest shall be deemed
to accrue immediately following the occurrence of the applicable Event Date.
The parties hereto agree that the Additional Interest provided for in this
Section 4 constitute a reasonable estimate of the damages that may be incurred
by Holders of Registrable
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Securities by reason of the failure of a Shelf Registration Statement or
Exchange Offer Registration Statement to be filed or declared effective, or a
Shelf Registration Statement to remain effective, as the case may be, in
accordance with this Section 4.
(c) The Guarantors guarantee the payment of the Additional Interest to the
same extent and in the same manner as the guarantee provisions set forth in
the Indenture, which provisions are incorporated herein by reference mutatis
mutandis.
5. REGISTRATION PROCEDURES
In connection with the registration of any Registrable Securities pursuant
to Sections 2 or 3 hereof, the Company and the Guarantors shall use their
respective best efforts to effect such registrations to permit the sale of
such Registrable Securities in accordance with the intended method or methods
of disposition thereof, and pursuant thereto the Company and the Guarantors
shall:
(a) Prepare and file with the SEC on or before the Filing Date, a
Registration Statement or Registration Statements as prescribed by Section
2 or 3, and to use their respective best efforts to cause each such
Registration Statement to become effective and remain effective as provided
herein, provided that, if (1) such filing is pursuant to Section 3, or (2)
a Prospectus contained in an Exchange Registration Statement filed pursuant
to Section 2 is required to be delivered under the Securities Act by any
Participating Broker-Dealer who seeks to sell Exchange Securities during
the Applicable Period, before filing any Registration Statement or
Prospectus or any amendments or supplements thereto, the Company and the
Guarantors shall furnish to and afford the Holders of the Registrable
Securities and each such Participating Broker-Dealer, as the case may be,
covered by such Registration Statement, their counsel and the managing
underwriters, if any, a reasonable opportunity to review copies of all such
documents (including copies of any documents to be incorporated by
reference therein and all exhibits thereto) proposed to be filed (at least
five days prior to such filing). The Company and the Guarantors shall not
file any Registration Statement or Prospectus or any amendments or
supplements thereto in respect of which the Holders must be afforded a
reasonable opportunity to review prior to the filing of such document, if
the Holders of a majority in aggregate principal amount of the Registrable
Securities covered by such Registration Statement, or such Participating
Broker-Dealer, as the case may be, their counsel, or the managing
underwriters, if any, shall reasonably object.
(b) Prepare and file with the SEC such amendments and post-effective
amendments to each Shelf Registration Statement or Exchange Offer
Registration Statement, as the case may be, as may be necessary to keep
such Registration Statement continuously effective for the Effectiveness
Period, in the case of a Shelf Registration Statement, or until the later
of the Expiration Date and the Applicable Period (if applicable), in the
case of the Exchange Offer Registration Statement; cause the related
Prospectus to be supplemented by any required Prospectus supplement, and as
so supplemented to be filed pursuant to Rule 424 (or any similar provisions
then in force) under the Securities Act; and comply with the provisions of
the Securities Act, the Exchange Act and the rules and regulations of the
SEC promulgated thereunder applicable to it with respect to the disposition
of all securities covered by such Registration Statement as so amended or
in such Prospectus as so supplemented and with respect to the subsequent
resale of any securities being sold by a Participating Broker-Dealer
covered by any such Prospectus.
(c) If (1) a Shelf Registration Statement is filed pursuant to Section 3,
or (2) a Prospectus contained in an Exchange Offer Registration Statement
filed pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Securities during the Applicable Period, notify the selling
Holders of Registrable Securities, or each such Participating Broker-
Dealer, as the case may be, their counsel and the managing underwriters, if
any, promptly (but in any event within five business days), and confirm
such notice in writing, (i) when a Prospectus or any Prospectus supplement
or post-effective amendment has been filed, and, with respect to a
Registration Statement or any post-effective amendment, when the same has
become effective (including in such notice a written statement that any
Holder may, upon request, obtain, without charge, one conformed copy of
such Registration Statement or post-effective amendment including financial
statements and schedules,
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documents incorporated or deemed to be incorporated by reference and
exhibits), (ii) of the issuance by the SEC of any stop order suspending the
effectiveness of a Registration Statement or of any order preventing or
suspending the use of any preliminary prospectus or the initiation of any
proceedings for that purpose, (iii) if at any time when a prospectus is
required by the Securities Act to be delivered in connection with sales of
the Registrable Securities the representations and warranties of the
Company or the Guarantors contained in any agreement (including any
underwriting agreement) contemplated by Section 5(o) below cease to be true
and correct, (iv) of the receipt by the Company of any notification with
respect to the suspension of the qualification or exemption from
qualification of a Registration Statement or any of the Registrable
Securities or the Exchange Securities to be sold by any Participating
Broker-Dealer for offer or sale in any jurisdiction, or the initiation or
threatening of any proceeding for such purpose, (v) of the happening of any
event or any information becoming known that makes any statement made in
such Registration Statement or related Prospectus or any document
incorporated or deemed to be incorporated therein by reference untrue in
any material respect or that requires the making of any changes in such
Registration Statement, Prospectus or documents so that, in the case of the
Registration Statement, it will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading, and
that in the case of the Prospectus, it will not contain any untrue
statement of a material fact or omit to state any material fact required to
be stated therein or necessary to make the statements therein, in the light
of the circumstances under which they were made, not misleading and (vi) of
the Company's reasonable determination that a post-effective amendment to a
Registration Statement would be appropriate.
(d) If (1) a Shelf Registration Statement is filed pursuant to Section 3,
or (2) a Prospectus contained in an Exchange Offer Registration Statement
filed pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Securities during the Applicable Period, use their respective best
efforts to prevent the issuance of any order suspending the effectiveness
of a Registration Statement or of any order preventing or suspending the
use of a Prospectus or suspending the qualification (or exemption from
qualification) of any of the Registrable Securities or the Exchange
Securities to be sold by any Participating Broker-Dealer, for sale in any
jurisdiction, and, if any such order is issued, to use their respective
best efforts to obtain the withdrawal of any such order at the earliest
possible moment.
(e) If a Shelf Registration Statement is filed pursuant to Section 3 and
if requested by the managing underwriters, if any, or the Holders of a
majority in aggregate principal amount of the Registrable Securities being
sold in connection with an underwritten offering, (i) promptly incorporate
in a prospectus supplement or post-effective amendment such information as
the managing underwriters, if any, or such Holders or counsel reasonably
request to be included therein, (ii) make all required filings of such
prospectus supplement or such post-effective amendment as soon as
reasonably practicable after the Company has received notification of the
matters to be incorporated in such prospectus supplement or post-effective
amendment, and (iii) supplement or make amendments to such Registration
Statement.
(f) If (1) a Shelf Registration Statement is filed pursuant to Section 3,
or (2) a Prospectus contained in an Exchange Offer Registration Statement
filed pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Securities during the Applicable Period, furnish to each selling
Holder of Registrable Securities and to each such Participating Broker-
Dealer who so requests and to counsel and each managing underwriter, if
any, without charge, one conformed copy of the Registration Statement or
Statements and each post-effective amendment thereto, including financial
statements and schedules, all documents incorporated or deemed to be
incorporated therein by reference and all exhibits.
(g) If (1) a Shelf Registration Statement is filed pursuant to Section 3,
or (2) a Prospectus contained in an Exchange Offer Registration Statement
filed pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Securities during the Applicable Period, deliver to each selling
Holder of Registrable Securities, or each such Participating Broker-Dealer,
as the case may be, their counsel, and the underwriters, if any, without
charge, as many
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copies of the Prospectus or Prospectuses (including each form of
preliminary prospectus) and each amendment or supplement thereto and any
documents incorporated by reference therein as such Persons may reasonably
request; and, subject to the last paragraph of this Section 5, the Company
and the Guarantors hereby consent to the use of such Prospectus and each
amendment or supplement thereto by each of the selling holders of
Registrable Securities or each such Participating Broker-Dealer, as the
case may be, and the underwriters or agents, if any, and dealers (if any),
in connection with the offering and sale of the Registrable Securities
covered by or the sale by Participating Broker-Dealers of the Exchange
Securities pursuant to such Prospectus and any amendment or supplement
thereto.
(h) Prior to any public offering of Registrable Securities or any
delivery of a Prospectus contained in the Exchange Offer Registration
Statement by any Participating Broker-Dealer who seeks to sell Exchange
Securities during the Applicable Period, to use their respective best
efforts to register or qualify, and to cooperate with the selling Holders
of Registrable Securities or each such Participating Broker-Dealer, as the
case may be, the underwriters, if any, and their respective counsel in
connection with the registration or qualification (or exemption from such
registration or qualification) of such Registrable Securities for offer and
sale under the securities or Blue Sky laws of such jurisdictions within the
United States as any selling Holder, Participating Broker-Dealer, or the
managing underwriters reasonably request in writing, provided that where
Exchange Securities held by Participating Broker-Dealers or Registrable
Securities are offered other than through an underwritten offering, the
Company and the Guarantors agree to cause their counsel to (i) perform Blue
Sky investigations and file registrations and qualifications required to be
filed pursuant to this Section 5(h); (ii) use their respective best efforts
to keep each such registration or qualification (or exemption therefrom)
effective during the period such Registration Statement is required to be
kept effective; and (iii) do any and all other acts or things necessary or
advisable to enable the disposition in such jurisdictions of the Exchange
Securities held by Participating Broker-Dealers or the Registrable
Securities covered by the applicable Registration Statement, provided that
neither the Company nor the Guarantors shall be required to (A) qualify
generally to do business in any jurisdiction where it is not then so
qualified, (B) take any action that would subject it to general service of
process in any such jurisdiction where it is not then so subject or (C)
subject itself to taxation in excess of a nominal dollar amount in any such
jurisdiction.
(i) If a Shelf Registration Statement is filed pursuant to Section 3,
cooperate with the selling Holders of Registrable Securities and the
managing underwriters, if any, to facilitate the timely preparation and
delivery of certificates representing Registrable Securities to be sold,
which certificates shall not bear any restrictive legends and shall be in a
form eligible for deposit with The Depository Trust Company; and enable
such Registrable Securities to be in such denominations and registered in
such names as the managing underwriter or underwriters, if any, or Holders
may reasonably request.
(j) Use their respective best efforts to cause the Registrable Securities
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 underwriters, if any, to
consummate the disposition of such Registrable Securities, except as may be
required solely as a consequence of the nature of such selling Holder's
business, in which case the Company and the Guarantors will cooperate in
all reasonable respects with the filing of such Registration Statement and
the granting of such approvals.
(k) If (1) a Shelf Registration Statement is filed pursuant to Section 3,
or (2) a Prospectus contained in an Exchange Offer Registration Statement
filed pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Securities during the Applicable Period, upon the occurrence of
any event contemplated by paragraph 5(c)(v) or 5(c)(vi) above, as promptly
as practicable prepare and (subject to Section 5(a) above) file with the
SEC, solely at the expense of the Company and the Guarantors, a supplement
or post-effective amendment to the Registration Statement or a supplement
to the related Prospectus or any document incorporated or deemed to be
incorporated therein by reference, or file any other required document so
that, as thereafter delivered to the purchasers of the Registrable
Securities being sold thereunder or to the purchasers of the Exchange
Securities to whom such Prospectus will be delivered by a Participating
Broker-Dealer, any such Prospectus
9
will not contain an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.
(l) Use their respective best efforts to cause the Registrable Securities
covered by a Registration Statement or the Exchange Securities, as the case
may be, to be rated with the appropriate rating agencies, if so requested
by the Holders of a majority in aggregate principal amount of Registrable
Securities covered by such Registration Statement or the Exchange
Securities, as the case may be, or the managing underwriters, if any.
(m) Prior to the effective date of the first Registration Statement
relating to the Registrable Securities, (i) provide the Trustee with
printed certificates for the Registrable Securities in a form eligible for
deposit with The Depository Trust Company and (ii) provide a CUSIP number
for the Registrable Securities.
(n) [intentionally omitted]
(o) In connection with an underwritten offering of Registrable Securities
pursuant to a Shelf Registration Statement, enter into an underwriting
agreement as is customary in underwritten offerings and take all such other
actions as are reasonably requested by the managing underwriters in order
to expedite or facilitate the registration or the disposition of such
Registrable Securities, and in such connection, (i) make such
representations and warranties to the underwriters, with respect to the
business of the Company and its subsidiaries and the Registration
Statement, Prospectus and documents, if any, incorporated or deemed to be
incorporated by reference therein, in each case, as are customarily made by
issuers to underwriters in underwritten offerings, and confirm the same if
and when requested; (ii) obtain opinions of counsel to the Company and the
Guarantors and updates thereof in form and substance reasonably
satisfactory to the managing underwriters, addressed to the underwriters
covering the matters customarily covered in opinions requested in
underwritten offerings and such other matters as may be reasonably
requested by underwriters; (iii) obtain "cold comfort" letters and updates
thereof in form and substance reasonably satisfactory to the managing
underwriters from the independent certified public accountants of the
Company (and, if necessary, any other independent certified public
accountants of any subsidiary of the Company or of any business acquired by
the Company for which financial statements and financial data are, or are
required to be, included in the Registration Statement), addressed to each
of the underwriters, such letters to be in customary form and covering
matters of the type customarily covered in "cold comfort" letters in
connection with underwritten offerings and such other matters as reasonably
requested by underwriters; and (iv) if an underwriting agreement is entered
into, the same shall contain indemnification provisions and procedures no
less favorable than those set forth in Section 7 hereof (or such other
provisions and procedures acceptable to Holders of a majority in aggregate
principal amount of Registrable Securities covered by such Registration
Statement and the managing underwriters or agents) with respect to all
parties to be indemnified pursuant to said Section. The above shall be done
at each closing under such underwriting agreement, or as and to the extent
required thereunder.
(p) If (1) a Shelf Registration Statement is filed pursuant to Section 3,
or (2) a Prospectus contained in an Exchange Offer Registration Statement
filed pursuant to Section 2 is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Securities during the Applicable Period, make available for
inspection by any selling Holder of such Registrable Securities being sold,
or each such Participating Broker-Dealer, as the case may be, any
underwriter participating in any such disposition of Registrable
Securities, if any, and any attorney, accountant or other agent retained by
any such selling holder or each such Participating Broker-Dealer, as the
case may be, or underwriter (collectively, the "Inspectors"), at the
offices where normally kept, during reasonable business hours, all
financial and other records, pertinent corporate documents and properties
of the Company and its subsidiaries (collectively, the "Records") as shall
be reasonably necessary to enable them to exercise any applicable due
diligence responsibilities, and cause the officers, directors and employees
of the Company and its subsidiaries to supply all information in each case
reasonably requested by any such Inspector in connection with such
Registration Statement. Records which the Company determines, in good
faith, to be confidential and any Records which the Company notifies the
Inspectors are confidential shall not be
10
disclosed by the Inspectors unless (i) the disclosure of such Records is
necessary to avoid or correct a misstatement or omission in such
Registration Statement, (ii) the release of such Records is ordered
pursuant to a subpoena or other order from a court of competent
jurisdiction or (iii) the information in such Records has been made
generally available to the public. Each selling Holder of such Registrable
Securities and each such Participating Broker-Dealer will be required to
agree that information obtained by it as a result of such inspections shall
be deemed confidential and shall not be used by it as the basis for any
market transactions in the securities of the Company unless and until such
is made generally available to the public. Each selling Holder of such
Registrable Securities and each such Participating Broker-Dealer will be
required to further agree that it will, upon learning that disclosure of
such Records is sought in a court of competent jurisdiction, give notice to
the Company and allow the Company at its expense to undertake appropriate
action to prevent disclosure of the Records deemed confidential.
(q) Provide an indenture trustee for the Registrable Securities or the
Exchange Securities, as the case may be, and cause the Indenture or the
trust indenture provided for in Section 2(a), as the case may be, to be
qualified under the TIA not later than the effective date of the Exchange
Offer or the first Registration Statement relating to the Registrable
Securities; and in connection therewith, cooperate with the trustee under
any such indenture and the holders of the Registrable Securities, to effect
such changes to such indenture as may be required for such Indenture to be
so qualified in accordance with the terms of the TIA; and execute, and use
their respective best efforts to cause such trustee to execute, all
documents as may be required to effect such changes, and all other forms
and documents required to be filed with the SEC to enable such indenture to
be so qualified in a timely manner.
(r) Comply with all applicable rules and regulations of the SEC and make
generally available to their securityholders earning statements satisfying
the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder (or any similar rule promulgated under the Securities Act) no
later than 45 days after the end of any 12-month period (or 90 days after
the end of any 12-month period if such period is a fiscal year) (i)
commencing at the end of any fiscal quarter in which Registrable Securities
are sold to underwriters in a firm commitment or best efforts underwritten
offering and (ii) if not sold to underwriters in such an offering,
commencing on the first day of the first fiscal quarter of the Company
after the effective date of a Registration Statement, which statements
shall cover said 12-month periods.
(s) Upon consummation of an Exchange Offer or a Private Exchange, obtain
an opinion of counsel to the Company and the Guarantors addressed to the
Trustee for the benefit of all Holders of Registrable Securities
participating in the Exchange Offer or the Private Exchange, as the case
may be, and which includes an opinion that (i) the Company and the
Guarantors have duly authorized, executed and delivered the Exchange
Securities and Private Exchange Securities and the related indenture, and
(ii) each of the Exchange Securities or the Private Exchange Securities, as
the case may be, and related indenture constitute legal, valid and binding
obligations of the Company and the Guarantors, enforceable against the
Company and the Guarantors in accordance with its respective terms (with
customary exceptions).
(t) If an Exchange Offer or a Private Exchange is to be consummated, upon
delivery of the Registrable Securities by Holders to the Company (or to
such other Person as directed by the Company) in exchange for the Exchange
Securities or the Private Exchange Securities, as the case may be, the
Company shall xxxx, or caused to be marked, on such Registrable Securities
that such Registrable Securities are being cancelled in exchange for the
Exchange Securities or the Private Exchange Securities, as the case may be;
in no event shall such Registrable Securities be marked as paid or
otherwise satisfied.
(u) Cooperate with each seller of Registrable Securities covered by any
Registration Statement and each underwriter, if any, participating in the
disposition of such Registrable Securities and their respective counsel in
connection with any filings required to be made with the National
Association of Securities Dealers, Inc. (the "NASD").
(v) Use their respective best efforts to take all other steps necessary
to effect the registration of the Registrable Securities covered by a
Registration Statement contemplated hereby.
11
The Company and the Guarantors may require each seller of Registrable
Securities or Participating Broker-Dealer as to which any registration is
being effected to furnish to the Company and the Guarantors such information
regarding such seller or Participating Broker-Dealer and the distribution of
such Registrable Securities or Exchange Securities to be sold by such
Participating Broker-Dealer, as the case may be, as the Company and the
Guarantors may, from time to time, reasonably request. The Company and the
Guarantors may exclude from such registration the Registrable Securities of
any seller or Participating Broker-Dealer who unreasonably fails to furnish
such information within a reasonable time after receiving such request.
Each Holder of Registrable Securities and each Participating Broker-Dealer
agrees by acquisition of such Registrable Securities or Exchange Securities to
be sold by such Participating Broker-Dealer, as the case may be, that, upon
receipt of any notice from the Company of the happening of any event of the
kind described in Section 5(c)(ii), 5(c)(iv), 5(c)(v), or 5(c)(vi), such
Holder will forthwith discontinue disposition of such Registrable Securities
covered by such Registration Statement or Prospectus or Exchange Securities to
be sold by such Participating Broker-Dealer, as the case may be, until such
holder's receipt of the copies of the supplemented or amended Prospectus
contemplated by Section 5(k), or until it is advised in writing (the "Advice")
by the Company that the use of the applicable Prospectus may be resumed, and
has received copies of any amendments or supplements thereto.
6. REGISTRATION EXPENSES
(a) All fees and expenses incident to the performance of or compliance with
this Agreement by the Company and the Guarantors shall be borne by the Company
and the Guarantors whether or not the Exchange Offer or a Shelf Registration
Statement is filed or becomes effective, including, without limitation, (i)
all registration and filing fees (including, without limitation, (A) fees with
respect to filings required to be made with the NASD in connection with an
underwritten offering and (B) fees and expenses of compliance with state
securities or Blue Sky laws (including, without limitation, reasonable fees
and disbursements of counsel in connection with Blue Sky qualifications of the
Registrable Securities or Exchange Securities and determination of the
eligibility of the Registrable Securities or Exchange Securities for
investment under the laws of such jurisdictions (x) where the holders of
Registrable Securities are located, in the case of the Exchange Securities, or
(y) as provided in Section 5(h), in the case of Registrable Securities or
Exchange Securities to be sold by a Participating Broker-Dealer during the
Applicable Period)), (ii) printing expenses (including, without limitation,
expenses of printing certificates for Registrable Securities or Exchange
Securities in a form eligible for deposit with The Depository Trust Company
and of printing prospectuses if the printing of prospectuses is requested by
the managing underwriters, if any, or, in respect of Registrable Securities or
Exchange Securities to be sold by any Participating Broker-Dealer during the
Applicable Period, by the Holders of a majority in aggregate principal amount
of the Registrable Securities included in any Registration Statement or of
such Exchange Securities, as the case may be), (iii) messenger, telephone and
delivery expenses, (iv) fees and disbursements of counsel for the Company and
the Guarantors and reasonable fees and disbursements of special counsel for
the sellers of Registrable Securities (subject to the provisions of Section
6(b)), (v) fees and disbursements of all independent certified public
accountants referred to in Section 5(o)(iii) (including, without limitation,
the expenses of any special audit and "cold comfort" letters required by or
incident to such performance), (vi) the reasonable fees and expenses of any
"qualified independent underwriter" or other independent appraiser
participating in an offering pursuant to Section 3 of Schedule E to the By-
laws of the National Association of Securities Dealers, Inc., (vii) rating
agency fees, (viii) Securities Act liability insurance, if the Company and the
Guarantors desire such insurance, (ix) fees and expenses of all other Persons
retained by the Company and the Guarantors, (x) internal expenses of the
Company and the Guarantors (including, without limitation, all salaries and
expenses of officers and employees of the Company and the Guarantors
performing legal or accounting duties), (xi) the expense of any annual audit,
(xii) the fees and expenses incurred in connection with the listing of the
securities to be registered on any securities exchange and (xiii) the expenses
relating to printing, word processing and distributing all Registration
Statements, underwriting agreements, securities sales agreements, indentures
and any other documents necessary in order to comply with this Agreement.
12
(b) In connection with any Shelf Registration Statement hereunder, the
Company and the Guarantors shall reimburse the Holders of the Registrable
Securities being registered in such registration for the reasonable fees and
disbursements of not more than one counsel (in addition to appropriate local
counsel) chosen by the Holders of a majority in aggregate principal amount of
the Registrable Securities to be included in such Registration Statement and
other reasonable out-of-pocket expenses of the Holders of Registrable
Securities incurred in connection with the registration of the Registrable
Securities.
7. INDEMNIFICATION
The Company and the Guarantors, jointly and severally, agree to indemnify
and hold harmless each Holder of Registrable Securities and each Participating
Broker-Dealer selling Exchange Securities during the Applicable Period, the
officers and directors of each such person, and each person, if any, who
controls any such person within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act (each, a "Participant"), from
and against any and all losses, claims, damages and liabilities (including,
without limitation, the reasonable legal fees and other expenses actually
incurred in connection with any suit, action or proceeding or any claim
asserted) caused by any untrue statement or alleged untrue statement of a
material fact contained in any Registration Statement (or any amendment
thereto) or Prospectus (as amended or supplemented if the Company or the
Guarantors shall have furnished any amendments or supplements thereto) or any
preliminary prospectus, or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any untrue statement or omission or alleged untrue
statement or omission made in reliance upon and in conformity with information
furnished to the Company in writing by such Participant expressly for use
therein; provided that the foregoing indemnity with respect to any preliminary
prospectus shall not inure to the benefit of any Participant (or to the
benefit of any person controlling such Participant) from whom the person
asserting any such losses, claims, damages or liabilities purchased
Registrable Securities or Exchange Securities if such untrue statement or
omission or alleged untrue statement or omission made in such preliminary
prospectus is eliminated or remedied in the related Prospectus (as amended or
supplemented if the Company and the Guarantors shall have furnished any
amendments or supplements thereto) and a copy of the related Prospectus (as so
amended or supplemented) shall not have been furnished to such person at or
prior to the sale of such Registrable Securities or Exchange Securities, as
the case may be, to such person.
Each Participant will be required to agree, severally and not jointly, to
indemnify and hold harmless each of the Company and the Guarantors, its
directors, its officers and each person who controls the Company or the
Guarantors within the meaning of Section 15 of the Securities Act or Section
20 of the Exchange Act to the same extent as the foregoing indemnity from the
Company and the Guarantors to each Participant, but only with reference to
information furnished to the Company in writing by such Participant expressly
for use in any Registration Statement or Prospectus, any amendment or
supplement thereto, or any preliminary prospectus. The liability of any
Participant under this paragraph shall in no event exceed the proceeds
received by such Participant from sales of Registrable Securities giving rise
to such obligations.
If any suit, action, proceeding (including any governmental or regulatory
investigation), claim or demand shall be brought or asserted against any
person in respect of which indemnity may be sought pursuant to either of the
two preceding paragraphs, such person (the "Indemnified Person") shall
promptly notify the person against whom such indemnity may be sought (the
"Indemnifying Person") in writing, and the Indemnifying Person, upon request
of the Indemnified Person, shall retain counsel reasonably satisfactory to the
Indemnified Person to represent the Indemnified Person and any others the
Indemnifying Person may designate in such proceeding and shall pay the
reasonable fees and expenses actually incurred by such counsel related to such
proceeding, provided, that the failure to so notify the Indemnifying Person
shall not relieve it of any obligation or liability which it may have
hereunder or otherwise (unless and only to the extent that such failure
directly results in the loss or compromise of any material rights). In any
such proceeding, any Indemnified Person shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
13
such Indemnified Person unless (i) the Indemnifying Person and the Indemnified
Person shall have mutually agreed to the contrary, (ii) the Indemnifying
Person has failed within a reasonable time to retain counsel reasonably
satisfactory to the Indemnified Person or (iii) the named parties in any such
proceeding (including any impleaded parties) include both the Indemnifying
Person and the Indemnified Person and representation of both parties by the
same counsel would be inappropriate due to a conflict of interest or the
defendants in any such action including both the Indemnified Person and the
Indemnifying Person and the Indemnified Person shall have been advised by
counsel that there may be one or more legal defenses available to it and/or
the other Indemnified Persons that are different from or additional to those
of the Indemnifying Person. It is understood that the Indemnifying Person
shall not, in connection with any proceeding or related proceeding in the same
jurisdiction, be liable for the fees and expenses of more than one separate
firm (in addition to any local counsel) for all Indemnified Persons, and that
all such fees and expenses shall be reimbursed as they are incurred. Any such
separate firm for the Participants shall be designated in writing by
Participants who sold a majority in interest of Registrable Securities sold by
all such Participants and any such separate firm for the Company or the
Guarantors, its directors, its officers and such control persons of the
Company or the Guarantors shall be designated in writing by the Company. The
Indemnifying Person shall not be liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or if
there be a final judgment for the plaintiff, the Indemnifying Person agrees to
indemnify any Indemnified Person from and against any loss or liability by
reason of such settlement or judgment. Notwithstanding the foregoing sentence,
if at any time an Indemnified Person shall have requested an Indemnifying
Person to reimburse the Indemnified Person for reasonable fees and expenses
actually incurred by counsel as contemplated by the third sentence of this
paragraph, the Indemnifying Person agrees that it shall be liable for any
settlement of any proceeding effected without its written consent if (i) such
settlement is entered into more than 30 days after receipt by such
Indemnifying Person of the aforesaid request and (ii) such Indemnifying Person
shall not have reimbursed the Indemnified Person in accordance with such
request prior to the date of such settlement; provided, however, that the
Indemnifying Person shall not be liable for any settlement effected without
its consent pursuant to this sentence if the Indemnifying Party is contesting,
in good faith, the request for reimbursement. No Indemnifying Person shall,
without the prior written consent of the Indemnified Person, effect any
settlement of any pending or threatened proceeding in respect of which any
Indemnified Person is or could have been a party and indemnity could have been
sought hereunder by such Indemnified Person, unless such settlement includes
an unconditional release of such Indemnified Person from all liability on
claims that are the subject matter of such proceeding.
If the indemnification provided for in the first and second paragraphs of
this Section 7 is for any reason unavailable to, or insufficient to hold
harmless, an Indemnified Person in respect of any losses, claims, damages or
liabilities referred to therein, then each Indemnifying Person under such
paragraphs, in lieu of indemnifying such Indemnified Person thereunder and in
order to provide for just and equitable contribution, shall contribute to the
amount paid or payable by such Indemnified Person as a result of such losses,
claims, damages or liabilities in such proportion as is appropriate to reflect
(i) the relative benefits received by the Indemnifying Person or Persons on
the one hand and the Indemnified Person or Persons on the other from the
offering of the Notes or (ii) if the allocation provided by the foregoing
clause (i) is not permitted by applicable law, not only such relative benefits
but also the relative fault of the Indemnifying Person or Persons on the one
hand and the Indemnified Person or Persons on the other in connection with the
statements or omissions or alleged statements or omissions that resulted in
such losses, claims, damages or liabilities (or actions in respect thereof) as
well as any other relevant equitable considerations. The relative benefits
received by the Company and the Guarantors on the one hand and the
Participants on the other shall be deemed to be in the same proportion as the
total proceeds from the offering (net of discounts and commissions but before
deducting expenses) of the Notes received by the Company bears to the total
proceeds received by such Participant from the sale of Registrable Securities
or Exchange Securities, as the case may be. The relative fault of the parties
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Company and the Guarantors on the one hand or such Participant or such other
Indemnified Person, as the case may be, on the other, the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission, and any other equitable considerations appropriate
in the circumstances.
14
The parties shall agree that it would not be just and equitable if
contribution pursuant to this Section 7 were determined by pro rata allocation
(even if the Participants were treated as one entity for such purpose) or by
any other method of allocation that does not take account of the equitable
considerations referred to in the immediately preceding paragraph. The amount
paid or payable by an Indemnified Person as a result of the losses, claims,
damages and liabilities referred to in the immediately preceding paragraph
shall be deemed to include, subject to the limitations set forth above, any
reasonable legal or other expenses actually incurred by such Indemnified
Person in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 7, in no event shall a
Participant be required to contribute any amount in excess of the amount by
which proceeds received by such Participant from sales of Registrable
Securities exceeds the amount of any damages that such Participant has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
The indemnity and contribution agreements contained in this Section 7 will
be in addition to any liability which the Indemnifying Persons may otherwise
have to the Indemnified Persons referred to above.
8. RULE 144
The Company and the Guarantors covenant that they will file the reports
required to be filed by them under the Securities Act and the Exchange Act and
the rules and regulations adopted by the SEC thereunder in a timely manner
and, if at any time the Company and the Guarantors are not required to file
such reports, they will, upon the request of any Holder of Registrable
Securities, make publicly available other information so long as necessary to
permit sales pursuant to Rule 144 and Rule 144A under the Securities Act. The
Company and the Guarantors further covenant that they will take such further
action as any Holder of Registrable Securities may reasonably request, all to
the extent required from time to time to enable such holder to sell
Registrable Securities without registration under the Securities Act within
the limitation of the exemptions provided by Rule 144 and Rule 144A under the
Securities Act.
9. UNDERWRITTEN REGISTRATIONS
If any of the Registrable Securities covered by any Shelf Registration
Statement are to be sold in an underwritten offering, the investment banker or
investment bankers and manager or managers that will manage the offering will
be selected by the Holders of a majority in aggregate principal amount of such
Registrable Securities included in such offering and reasonably acceptable to
the Company.
No Holder of Registrable Securities may participate in any underwritten
registration hereunder unless such Holder (a) agrees to sell such Holder's
Registrable Securities on the basis provided in any underwriting arrangements
approved by the Persons entitled hereunder to approve such arrangements and
(b) completes and executes all questionnaires, powers of attorney,
indemnities, underwriting agreements and other documents required under the
terms of such underwriting arrangements.
10. MISCELLANEOUS
(a) Remedies. In the event of a breach by the Company or the Guarantors of
any of their respective obligations under this Agreement, each Holder of
Registrable Securities, in addition to being entitled to exercise all rights
provided herein, in the Indenture or, in the case of the Initial Purchasers,
in the Purchase Agreement or granted by law, including recovery of damages,
will be entitled to specific performance of its rights under this Agreement.
The Company and the Guarantors agree that monetary damages would not be
adequate compensation for any loss incurred by reason of a breach by them of
any of the provisions of this Agreement and hereby further agree that, in the
event of any action for specific performance in respect of such breach, they
shall waive the defense that a remedy at law would be adequate.
(b) No Inconsistent Agreements. Neither the Company nor any of the
Guarantors has, as of the date hereof, entered and shall, after the date of
this Agreement, enter into any agreement with respect to any of their
securities that is inconsistent with the rights granted to the Holders of
Registrable Securities in this Agreement
15
or otherwise conflicts with the provisions hereof. Neither the Company nor any
of the Guarantors has entered and will enter into any agreement with respect
to any of their securities which will grant to any Person "piggy-back" rights
with respect to a Registration Statement.
(c) Adjustments Affecting Registrable Securities. Neither the Company nor
any of the Guarantors shall, directly or indirectly, take any action with
respect to the Registrable Securities as a class that would adversely affect
the ability of the Holders of Registrable Securities to include such
Registrable Securities in a registration undertaken pursuant to this
Agreement.
(d) Additional Guarantors. So long as any Registrable Securities remain
outstanding, the Company shall cause each Material Subsidiary, whether formed
or acquired after the Closing Date, that becomes a guarantor under the
Indenture to execute and deliver a counterpart to this Agreement which
subjects such Material Subsidiary to the provisions of this Agreement as a
Guarantor.
(e) Amendments and Waivers. Except as provided for in paragraph (d) above,
the provisions of this Agreement may not be amended, modified or supplemented,
and waivers or consents to departures from the provisions hereof may not be
given, otherwise than with the prior written consent of (A) the Holders of not
less than a majority in aggregate principal amount of the then outstanding
Registrable Securities and (B) in circumstances that would adversely affect
the Participating Broker-Dealers, the Participating Broker-Dealers holding not
less than a majority in aggregate principal amount of the Exchange Securities
held by all Participating Broker-Dealers; provided, however, that Section 7
and this Section 10(c) may not be amended, modified or supplemented without
the prior written consent of each Holder and each Participating Broker-Dealer
(including any person who was a Holder or Participating Broker-Dealer of
Registrable Securities or Exchange Securities, as the case may be, disposed of
pursuant to any Registration Statement) affected by any such amendment,
modification or supplement. Notwithstanding the foregoing, a waiver or consent
to depart from the provisions hereof with respect to a matter that relates
exclusively to the rights of Holders of Registrable Securities whose
securities are being sold pursuant to a Registration Statement and that does
not directly or indirectly affect, impair, limit or compromise the rights of
other Holders of Registrable Securities may be given by Holders of at least a
majority in aggregate principal amount of the Registrable Securities being
sold by such Holders pursuant to such Registration Statement.
(f) Notices. All notices and other communications (including without
limitation any notices or other communications to the Trustee) provided for or
permitted hereunder shall be made in writing by hand-delivery, registered
first-class mail, next-day air courier or telecopier:
(i) if to a Holder of Registrable Securities, at the most current address
given by the Trustee to the Company; and
(ii) if to the Company or the Guarantors, at Newport News Shipbuilding
Inc., 0000 Xxxxxxxxxx Xxxxxx, Xxxxxxx Xxxx, Xxxxxxxx 00000, Attention:
Chief Financial Officer.
All such notices and communications shall be deemed to have been duly given:
when delivered by hand, if personally delivered; five business days after
being deposited in the mail, postage prepaid, if mailed; one business day
after being timely delivered to a next-day air courier; and when receipt is
acknowledged by the addressee, if telecopied.
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the trustee under the
Indenture at the address specified in such Indenture.
(g) Successors and Assigns. This Agreement shall inure to the benefit of and
be binding upon the successors and assigns of each of the parties, including
without limitation and without the need for an express assignment, subsequent
Holders of Registrable Securities; provided, that, with respect to the
indemnity and contribution agreements in Section 7, each Holder of Registrable
Securities subsequent to the Initial Purchasers shall be bound by the terms
thereof if (i) such Holder elects to include Registrable Securities in a Shelf
Registration Statement and (ii) such Holder is advised expressly by the
Company of the provisions contained in Section 7 and that such Holder's
election to include Registrable Securities in a Shelf Registration Statement
shall be deemed such Holder's agreement to be bound by such provisions.
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(h) 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.
(i) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(j) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS
MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES
OF CONFLICTS OF LAW. EACH OF THE PARTIES HERETO AGREES TO SUBMIT TO THE
JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK IN ANY ACTION OR
PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.
(k) Severability. If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction to be invalid, illegal,
void or unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein shall remain in full force and effect and shall
in no way be affected, impaired or invalidated, and the parties hereto shall
use their best efforts to find and employ an alternative means to achieve the
same or substantially the same result as that contemplated by such term,
provision, covenant or restriction. It is hereby stipulated and declared to be
the intention of the parties that they would have executed the remaining
terms, provisions, covenants and restrictions without including any of such
that may be hereafter declared invalid, illegal, void or unenforceable.
(l) Entire Agreement. This Agreement, together with the Purchase Agreement,
is intended by the parties as a final expression of their agreement, and is
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 and therein.
(m) Securities Held by the Company or its Affiliates. Whenever the consent
or approval of holders of a specified percentage of Registrable Securities is
required hereunder, Registrable Securities held by the Company or its
affiliates (as such term is defined in Rule 405 under the Securities Act)
shall not be counted in determining whether such consent or approval was given
by the Holders of such required percentage.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
Newport News Shipbuilding Inc.
/s/ Xxxxxxx X. Xxxxxxxx
By: _________________________________
Name: Xxxxxxx X. Xxxxxxxx
Title: Vice President &
General Counsel
Newport News Shipbuilding and Dry
Dock Company
/s/ Xxxxxxx X. Xxxxxxxx
By: _________________________________
Name: Xxxxxxx X. Xxxxxxxx
Title: Vice President &
General Counsel
X.X. Xxxxxx Securities Inc.
CS First Boston Corporation
Xxxxxx Xxxxxxx & Co. Incorporated
BA Securities, Inc.
Nationsbanc Capital Markets, Inc.
By: X.X. Xxxxxx Securities Inc.
/s/ Xxxxxx Tulip
By: _________________________________
Name: Xxxxxx Tulip
Title: Vice President
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