This Note Resale Registration Rights Agreement (this
"Agreement") is made and entered into as of October 23, 1995 by
and among SOFTKEY INTERNATIONAL INC., a Delaware corporation (the
"Company"), and BEAR, XXXXXXX & CO. INC. and XXXXXXXXXX
SECURITIES (collectively, the "Purchasers"), which Purchasers
have agreed to purchase from the Company up to $402,500,000
principal amount of 51/2% Senior Convertible Notes due 2000 (the
"Notes") pursuant to the Purchase Agreement (as defined below).
This Agreement is made pursuant to the Purchase
Agreement dated October 17, 1995 (the "Purchase Agreement") by
and among the Company and the Purchasers. In order to induce the
Purchasers to purchase the Notes, the Company has agreed to
provide the registration rights set forth in this Agreement. The
execution and delivery of this Agreement is provided for in 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: Securities Act of 1933, as amended.
Agreement: As defined in the preamble hereto.
Broker-Dealer: Any broker or dealer registered under
the Exchange Act (as hereinafter defined).
Closing Date: The date of this Agreement.
Commission: Securities and Exchange Commission.
Common Stock: Common Stock of the Company issuable
upon conversion of the Notes.
Company: As defined in the preamble hereto.
Consummate: An Exchange Offer (as hereinafter defined)
shall be deemed "Consummated" for purposes of this Agreement upon
(i) the filing and effectiveness under the Act of the Exchange
Offer Registration Statement relating to the New Notes (as
hereinafter defined) to be issued in the Exchange Offer, (ii) the
maintenance of such Exchange Offer Registration Statement
continuously effective and the keeping of 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, and (iii) the delivery by
the Company to the registrar under the Indenture (as hereinafter
defined) of New Notes in the same aggregate principal amount as
the aggregate principal amount of Notes that were tendered by
Holders (as hereinafter defined) thereof pursuant to the Exchange
Offer.
Effectiveness Target Date: As defined in Section 3
hereof.
Exchange Act: Securities Exchange Act of 1934, as
amended.
Exchange Offer: The registration by the Company under
the Act of the New Notes pursuant to the Exchange Offer
Registration Statement through which the Company offers the
Holders of all outstanding Transfer Restricted Securities (as
hereinafter defined) the opportunity to exchange all such
outstanding Transfer Restricted Securities held by such Holders
for New Notes 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: As defined in
Section 3(c).
Exempt Resales: The transactions in which the
Purchasers propose to sell the Notes (i) to certain "qualified
institutional buyers," as such term is defined in Rule 144A under
the Act ("QIBs"), (ii) to certain institutional "accredited
investors," as such term is defined in Rule 501(a)(1), (2), (3)
or (7) of Regulation D under the Act ("Accredited Institutions")
and (iii) outside the United States, to certain persons in
offshore transactions in reliance on Regulation S under the Act.
Holder: As defined in Section 2(b) hereof.
Indemnified Holder: As defined in Section 6(a) hereof.
Indenture: The Indenture dated as of October 16, 1995
by and among the Company and State Street Bank and Trust Company,
as trustee (the "Trustee"), pursuant to which the Notes are to be
issued, as such Indenture is amended, modified or supplemented
from time to time in accordance with the terms thereof.
Interest Payment Date: As defined in the Indenture and
the Notes.
NASD: National Association of Securities Dealers, Inc.
New Notes: As defined in Section 3(c) hereof.
Person: An individual, partnership, corporation,
trust, unincorporated organization or a government, agency or
political subdivision thereof.
Prospectus: The prospectus included in any
Registration Statement, as amended or supplemented including
without limitation by any post-effective amendments thereto, and
all material incorporated by reference into such prospectus.
Purchase Agreement: As defined in the preamble hereto.
Purchasers: As defined in the preamble hereto.
Registration Statement: The Shelf Registration
Statement or the Exchange Offer Registration Statement of the
Company which is filed pursuant to the provisions of Section 3 of
this Agreement, including the Prospectus included therein, all
amendments and supplements thereto (including any post-effective
amendments) and all exhibits and material incorporated by
reference therein.
Shelf Filing Deadline: As defined to Section 3 hereof.
Shelf Registration Statement: As defined in Section 3
hereof.
TIA: The Trust Indenture Act of 1939 (15 U.S.C.
Section 77aaa-77bbbb), as amended and in effect on the date of
the Indenture.
Transfer Restricted Securities: Each Note, and any
Common Stock issued upon conversion of any Note, until the
earliest to occur of (a) the date on which such Note or Common
Stock, as the case may be, has been effectively registered under
the Act and disposed of in accordance with an effective Shelf
Registration Statement, (b) the date on which such Note is
exchanged for a New Note in the Exchange Offer and entitled to be
resold to the public by the Holder thereof without complying with
the prospectus delivery requirements of the Act, (c) the date on
which such Note or Common Stock, as the case may be, is
distributed to the public pursuant to Rule 144 under the Act or
by a Broker-Dealer pursuant to the "Plan of Distribution"
contemplated by the Exchange Offer Registration Statement
(including delivery of the Prospectus contained therein), and (d)
the date on which such Note is converted into Common Stock in
accordance with the terms and provisions of the Note and the
Indenture.
Underwritten Registration or Underwritten Offering: A
registration in which securities of the Company are sold to an
underwriter for reoffering to the public.
SECTION 2. SECURITIES SUBJECT TO THIS AGREEMENT
(a) Transfer Restricted Securities. The securities
entitled to the benefits of this Agreement are the Transfer
Restricted Securities.
(b) Holders of Transfer Restricted Securities. A
Person is deemed to be a holder of Transfer Restricted Securities
(each, a "Holder") whenever such Person owns Transfer Restricted
Securities of record.
SECTION 3. REGISTRATION
(a) Shelf Registration. The Company hereby agrees to:
(i) use its best efforts to file or cause to be filed
a continuous registration statement pursuant to Rule 415
under the Act (together with the Prospectus included
therein, all amendments and supplements thereto (including
post-effective amendments) and all exhibits and materials
incorporated by reference therein, the "Shelf Registration
Statement") on or prior to the 90th day after the Closing
Date (the "Shelf Filing Deadline"), which Shelf Registration
Statement shall provide for resales of all Transfer
Restricted Securities, provided that the Holders thereof
shall have provided the information required pursuant to
Section 3(b) hereof; and
(ii) use all reasonable efforts to cause the Shelf
Registration Statement to be declared effective by the
Commission as promptly as practicable after the Closing Date
(the "Effectiveness Target Date").
Subject to any notice by the Company in accordance with Section
4(b) hereof of the existence of any fact or event of the kind
described in Section 4(b)(iii)(D) hereof, the Company shall use
all reasonable efforts to keep the Shelf Registration Statement
continuously effective, supplemented and amended as required by
the provisions of Sections 4(a) and (b) hereof to the extent
necessary to ensure that it is available for resales of Transfer
Restricted Securities by the Holders of Transfer Restricted
Securities entitled to the benefit of this Section 3(a) and to
ensure that the Shelf Registration Statement conforms to the
requirements of this Agreement, the Act and the policies, rules
and regulations of the Commission as announced from time to time
thereunder for a period of at least three years following the
Closing Date.
(b) Certificated Securities; 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 (i) such
Holder holds such Transfer Restricted Securities in the form of
definitive Notes (as provided in the Indenture) which are
evidenced by physical certificates and (ii) until such Holder
furnishes to the Company in writing, within 20 business days
after receipt of a request therefor, such information as the
Company may reasonably request for use in connection with the
Shelf Registration Statement or any Prospectus or preliminary
Prospectus included therein. In connection with all such
requests for information from Holders of Transfer Restricted
Securities, the Company shall notify such Holders of the
requirements set forth in the preceding sentence. Each Holder as
to which any Shelf Registration Statement is being effected
agrees to furnish promptly to the Company all information
required to be disclosed in order to make the information
previously furnished to the Company by such Holder not materially
misleading.
(c) Registered Exchange Offer. If, based upon a
written opinion of counsel (other than in-house counsel) to the
Company addressed and delivered to the Holders, the Company
determines that it is permissible under applicable law and
Commission policy to Consummate an Exchange Offer, the Company
may Consummate an Exchange Offer in lieu of filing and
maintaining the Shelf Registration Statement described herein.
If the Company elects to Consummate an Exchange Offer in
accordance with the provisions hereof, the Company shall (i)
cause to be filed with the Commission no later than the Shelf
Filing Deadline, a Registration Statement (the "Exchange Offer
Registration Statement") under the Act relating to (A) a new
issue of notes identical in all material respects to the Notes
except as to transfer restrictions (the "New Notes") and (B) the
shares of Common Stock issuable upon conversion of such New
Notes), (ii) use all reasonable efforts to cause such
Registration Statement to become effective no later than the
Effectiveness Target Date, (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 New
Notes 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 the Registration Statement,
commence the Exchange Offer. The Company shall cause the
Exchange Offer to comply with all applicable federal and state
securities laws. No securities other than the New Notes (and the
shares of Common Stock issuable upon conversion of such New
Notes) shall be included in the Exchange Offer Registration
Statement. The Company shall use all 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 after such
effectiveness. The Exchange Offer shall be on the appropriate
form permitting registration of the New Notes to be offered in
exchange for the Notes and to permit resales of New Notes and
shares of Common Stock received by Broker-Dealers in the Exchange
Offer by delivering the Prospectus contained in the Exchange
Offer Registration Statement. The "Plan of Distribution" section
in the Prospectus contained in the Exchange Offer Registration
Statement 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 Commission policy. The Company shall use its
best efforts to keep the Exchange Offer Registration Statement
continuously effective, supplemented and amended to the extent
necessary to ensure that it is available for resales of New 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 one year from the
date on which the Exchange Offer Registration Statement is
declared effective. The Company shall provide sufficient copies
of the latest version of such Prospectus to Broker-Dealers
promptly upon request at any time during such one-year period in
order to facilitate such resales. Notwithstanding anything
herein to the contrary, despite the Consummation of an Exchange
Offer, the Company shall be required to file the Shelf
Registration Statement in accordance with Section 3(a) hereof if
any Holder of Transfer Restricted Securities shall notify the
Company within 20 business days of the Consummation of the
Exchange Offer (x) that such Holder is prohibited by applicable
law or Commission policy from participating in the Exchange
Offer, (y) that such Holder may not resell the New 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 (z) that such Holder is a Broker-
Dealer and holds Notes acquired directly from the Company or one
of its affiliates.
SECTION 4. REGISTRATION PROCEDURES
(a) In connection with any Shelf Registration
Statement, the Company shall comply with all the provisions of
Section 4(b) below and shall use all reasonable efforts to effect
such registration to permit the resale of the Transfer Restricted
Securities being sold in accordance with the intended method or
methods of distribution thereof.
(b) In connection with any Registration Statement and
any Prospectus required by this Agreement, the Company shall:
(i) subject to any notice by the Company in
accordance with this Section 4(b) of the existence of
any fact or event of the kind described in Section
4(b)(iii)(D) hereof, use all reasonable efforts to keep
such Registration Statement continuously effective and
provide all requisite financial statements for the
period specified in Section 3 of this Agreement; upon
the occurrence of any event that would cause 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
resales of Transfer Restricted Securities during the
period required by this Agreement, the Company shall
file promptly an appropriate amendment to such
Registration Statement correcting any such misstatement
or omission, and, in the case of either clause (A) or
(B), except as set forth in Section 4(b)(xv) below, use
all 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;
(ii) prepare and file with the Commission such
amendments and post-effective amendments to such
Registration Statement as may be necessary to keep such
Registration Statement effective for the applicable
period set forth in Section 3 hereof, 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, cause the Prospectus 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 by the
sellers thereof set forth in such Registration
Statement or supplement to the Prospectus;
(iii) advise the underwriter(s), if any, and
selling Holders promptly and, if requested by such
Persons, to confirm such advice in writing, (A) when
the Prospectus or any Prospectus supplement or post-
effective amendment to any Registration Statement 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 for
offering or sale in any jurisdiction or of the
initiation of any proceeding for any of the preceding
purposes, (D) of the existence of any fact or the
happening of any event (including without limitation
pending negotiations relating to, or the consummation
of, a transaction or the occurrence of any event which
would require additional disclosure of material, non-
public information by the Company in the Registration
Statement as to which the Company has a bona fide
business purpose for preserving confidentiality or
which renders the Company unable to comply with
Commission requirements) that makes untrue 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, 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
under state securities or Blue Sky laws, the Company
shall use its best efforts to obtain the withdrawal or
lifting of such order at the earliest possible time;
(iv) furnish to each of the selling Holders,
upon request, and to each of the underwriter(s), if
any, before filing with the Commission, copies of any
Registration Statement or any Prospectus included
therein and any amendments or supplements thereto
(including all documents incorporated by reference
prior to the effectiveness of such Registration
Statement), which documents, other than documents
incorporated by reference, 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 shall not file any such Registration Statement
or Prospectus or any amendment or supplement to any
such Registration Statement or Prospectus to which a
selling Holder of Transfer Restricted Securities
covered by such Registration Statement or the
underwriter(s), if any, shall reasonably object within
five business days after the receipt thereof; a selling
Holder or underwriter, if any, shall be deemed to have
reasonably objected to such filing only if such
Registration Statement, amendment, Prospectus or
supplement, as applicable, as proposed to be filed,
contains a material misstatement or omission;
(v) if practicable, promptly prior to the
filing of any document that is to be incorporated by
reference into a Registration Statement or Prospectus
subsequent to the effectiveness thereof, and in any
event no later than the date such document is filed
with the Commission, provide copies of such document to
the selling Holders, if requested, and to the
underwriter(s), if any, make representatives of the
Company 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 underwriter(s), if
any, reasonably may request;
(vi) make available at reasonable times for
inspection by the selling Holders, any underwriter(s)
participating in any disposition pursuant to such
Registration Statement and any attorney or accountant
retained by such selling Holders or any of the
underwriter(s), all financial and other records,
pertinent corporate documents and properties of the
Company and cause the officers, directors and employees
of the Company to supply all information reasonably
requested by any such Holder, underwriter(s), attorney
or accountant in connection with such Registration
Statement subsequent to the filing thereof and prior to
its effectiveness;
(vii) if requested by any selling Holders or the
underwriter(s), if any, promptly incorporate in any
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 New Notes,
information with respect to the principal amount of
Transfer Restricted Securities or New Notes 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 New Notes to be sold
in such offering; and make all required filings of any
such Prospectus supplement or post-effective amendment
as soon as practicable after the Company is notified of
the matters to be incorporated in such Prospectus
supplement or post-effective amendment;
(viii) cause the Transfer Restricted Securities
covered by the Registration Statement to be rated with
the appropriate rating agencies, if so requested by the
Holders of a majority in aggregate principal amount of
Notes or New Notes covered thereby or the
underwriter(s), if any;
(ix) [Intentionally omitted]
(x) deliver to each selling Holder and each of
the underwriter(s), if any, without charge, as many
copies of the Prospectus (including each preliminary
prospectus intended for public distribution) and any
amendment or supplement thereto as such Persons
reasonably may request; the Company hereby consents to
the use of the Prospectus and any amendment or
supplement thereto by each of the selling Holders and
each of the underwriter(s), if any, in connection with
the offering and the sale of the Transfer Restricted
Securities or New Notes covered by the Prospectus or
any amendment or supplement thereto;
(xi) enter into such customary agreements
(including an underwriting agreement), and make such
customary representations and warranties, and, subject
to any notice by the Company in accordance with this
Section 4(b) of the existence of any fact or event of
the kinds described in Section 4(b)(iii)(D) hereof,
take all such other customary actions in connection
therewith in order to expedite or facilitate the
disposition of the Transfer Restricted Securities or
New Notes pursuant to any Registration Statement
contemplated by this Agreement, all to such extent as
may be requested by any Purchaser or by any Holder of
Transfer Restricted Securities or underwriter in
connection with any sale or resale pursuant to any
Registration Statement contemplated by this Agreement;
and whether or not an underwriting agreement is entered
into and whether or not the registration is an
Underwritten Registration, the Company shall:
(A) furnish to each Purchaser, each selling
Holder and each underwriter, if any (including any
Broker-Dealer who may be deemed to be an
underwriter), in such substance and scope as they
may request and as are customarily made by issuers
to underwriters in primary underwritten offerings,
upon the date of the effectiveness of the Shelf
Registration Statement, and, to the extent
applicable, upon the Consummation of the Exchange
Offer:
(1) a certificate, dated the date of
effectiveness of the Shelf Registration
Statement (or, to the extent applicable,
dated the date of Consummation of the
Exchange Offer) signed by (y) the president
or chief executive officer of the Company and
(z) the chief financial officer or the
principal financial or accounting officer or
the Company, confirming, as of the date
thereof, the matters set forth in Section
6(e)(i) and (iii) of the Purchase Agreement
and such other matters as such parties may
reasonably request;
(2) opinions, dated the date of
effectiveness of the Shelf Registration
Statement (or, to the extent applicable,
dated the date of Consummation of the
Exchange Offer) of outside and in-house
counsel, respectively, for the Company,
covering the matters set forth in Sections
6(a) and (b) of the Purchase Agreement and
such other matters as such parties may
reasonably request; and
(3) a customary comfort letter, dated
as of the date of effectiveness of the Shelf
Registration Statement (and, to the extent
applicable, as of the date of Consummation of
the Exchange Offer) from the independent
certified public accountants of the Company,
in the customary form and covering matters of
the type customarily covered in comfort
letters by underwriters in connection with
primary underwritten offerings, and
addressing the matters set forth in the
comfort letters delivered pursuant to Section
6(f) of the Purchase Agreement, without
exception;
(B) set forth in full or incorporate by
reference in the underwriting agreement, if any,
indemnification provisions and procedures
substantially in the form of those set forth in
Section 6 hereof with respect to all parties
required to be indemnified pursuant to said
Section 6; and
(C) deliver such other documents and
certificates as may be reasonably requested by
such parties to evidence compliance with clause
(A) above and with any customary conditions
contained in the underwriting agreement or other
agreement entered into by the Company pursuant to
this clause (xi), if any.
If at any time the representations and warranties
of the Company indirectly referenced in clause (A)(1)
above cease to be true and correct, the Company shall
so advise the Purchasers and the underwriter(s), if
any, and each selling Holder promptly and, if requested
by such Persons, shall confirm such advice in writing;
(xii) prior to any public offering of Transfer
Restricted Securities, cooperate with the selling
Holders, the underwriter(s), if any, and their
respective counsel in connection with the registration
and qualification of the Transfer Restricted Securities
under the securities or Blue Sky laws of such
jurisdictions as the selling Holders or underwriter(s)
may request; and do any and all other acts or things
necessary or advisable to enable the disposition in
such jurisdictions of the Transfer Restricted
Securities covered by the Shelf Registration Statement;
provided, however, that the Company shall not be
required to register or qualify as a foreign
corporation where it is not now so qualified or to take
any action that would subject it to service of process
in suits or to taxation, other than as to matters and
transactions relating to the Registration Statement, in
any jurisdiction where it is not now so subject;
(xiii) cooperate with the selling Holders and the
underwriter(s), if any, to facilitate the timely
preparation and delivery of certificates representing
Transfer Restricted Securities to be sold and not
bearing any restrictive legends; and enable such
Transfer Restricted Securities to be in such
denominations and registered in such names as the
Holders or the underwriter(s), if any, may request at
least two business days prior to any sale of Transfer
Restricted Securities made by such underwriter(s);
(xiv) use all reasonable efforts to cause the
Transfer Restricted 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 underwriter(s), if any, to
consummate the disposition of such Transfer Restricted
Securities, subject to the proviso contained in clause
(xii) above;
(xv) as soon as reasonably practicable after the
occurrence of any fact or event of the kind described
in clause (b)(iii)(D) above, 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, the
Prospectus will not contain an untrue statement of a
material fact or omit to state any material fact
necessary, in light of the circumstances in which it
was made, to make the statements therein not
misleading, provided, however, that notwithstanding
anything to the contrary herein, the Company shall not
be required to prepare and file such a supplement or
post-effective amendment or document if the fact no
longer exists; and provided further, however, that, in
the event of a material business transaction (including
without limitation pending negotiations relating to
such a transaction) which, based upon the advice of
outside counsel reasonably acceptable to the
Purchasers, would require disclosure by the Company in
the Registration Statement of material, nonpublic
information which the Company has a bona fide business
purpose for not disclosing, then for so long as such
circumstances and such business purpose continue to
exist, the Company shall not be required to prepare and
file a supplement or post-effective amendment
hereunder;
(xvi) 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
Notes or New Notes, as the case may be, which are in a
form eligible for deposit with the Depositary Trust
Company;
(xvii) cooperate in any filings required to be
made with the NASD and in the performance of any due
diligence investigation by any underwriter (including
any "qualified independent underwriter") that is
required to be retained in accordance with the rules
and regulations of the NASD, and use all reasonable
efforts to cause such Registration Statement to become
effective and be approved by such governmental agencies
or authorities as may be necessary to enable the
Holders selling Transfer Restricted Securities to
consummate the disposition of such Transfer Restricted
Securities;
(xviii) otherwise use its best efforts to comply
with all applicable rules and regulations of the
Commission, and make generally available to its
security holders, as soon as practicable, a
consolidated earnings statement meeting the
requirements of Rule 158 (which need not be audited)
for the twelve-month period (A) commencing at the end
of any fiscal quarter in which Transfer Restricted
Securities are sold to underwriters in a firm
commitment 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, as applicable, commencing after the
effective date of the Registration Statement;
(xix) cause the Indenture to be qualified under
the TIA not later than the effective date of the first
Registration Statement required to be filed 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
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;
(xx) cause all Transfer Restricted Securities
covered by the Registration Statement to be listed on
each securities exchange on which similar securities
issued by the Company are then listed if requested by
the Holders of a majority in aggregate principal amount
of Notes or the managing underwriter(s), if any; and
(xxi) provide promptly to each Holder upon
request any document filed with the Commission pursuant
to the requirements of Section 13 and Section 15 of the
Exchange Act.
Each Holder agrees by acquisition of a Transfer
Restricted Security that, upon receipt of any notice from the
Company of the existence of any fact or event of the kind
described in Section 4(b)(iii)(D) hereof, such Holder will
forthwith discontinue disposition of Transfer Restricted
Securities pursuant to the applicable Registration Statement
until such Holder's receipt of the copies of a supplemented or
amended Prospectus as contemplated by Section 4(b)(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 expense of the
Company) all copies, other than permanent file copies then in
such Holder's possession, of the Prospectus covering such
Transfer Restricted Securities that was current at the time of
receipt of such notice. In the event the Company shall give any
such notice, the time period regarding the effectiveness of such
Registration Statement set forth in Section 3 hereof shall be
extended by the number of days during the period from and
including the date of the giving of such notice pursuant to
Section 4(b)(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 4(b)(xv) hereof or shall have received
the Advice.
(c) In connection with the Exchange Offer, the Company
shall comply with all of the provisions of Section 4(b) (other
than those which are not applicable) and shall use its best
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. In addition, prior to
effectiveness of the Exchange Offer Registration Statement, the
Company shall provide a supplemental letter to the Commission (i)
stating that they 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 by the Company and (ii) including a
representation that the Company has not entered into any
arrangement or understanding with any Person to distribute the
New Notes to be received in the Exchange Offer and that, to the
best of the Company's information and belief, each Holder
participating in the Exchange Offer is acquiring the New Notes in
its ordinary course of business and has no arrangement or
understanding with any Person to participate in the distribution
of the New Notes received in the Exchange Offer. 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
(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 New Notes to be issued in the Exchange Offer and (C) it is
acquiring the New Notes in its ordinary course of business. In
addition, all such Holders of Transfer Restricted Securities
shall otherwise cooperate in the Company's 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 (1) could not under Commission policy as in
effect on the date of this Agreement rely on the position of the
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 and (2) 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 New Notes obtained by such Holder in exchange for Notes
acquired by such Holder directly from the Company.
SECTION 5. REGISTRATION EXPENSES
(a) All expenses incident to the Company's performance
of or compliance with this Agreement will be borne by the Company
regardless of whether a Registration Statement becomes effective,
including without limitation: (i) all registration and filing
fees and expenses (including filings made by any 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 associated with compliance with federal
securities and state Blue Sky or securities laws; (iii) all
expenses of printing (including printing of any certificates
evidencing the Notes and printing of Prospectuses), messenger and
delivery services and telephone; (iv) all fees and disbursements
of counsel for the Company and, as provided for in Section 5(b)
below, the Holders of Transfer Restricted Securities; (v) all
application and filing fees in connection with listing any
securities on a national securities exchange or automated
quotation system pursuant to the requirements hereof; and (vi)
all fees and disbursements of independent certified public
accountants of the Company (including the expenses of any special
audit and comfort letters required by or incident to such
performance).
The Company will, in any event, bear its own internal
expenses (including, without limitation, all salaries and
expenses of its officers and employees performing legal or
accounting duties), the expenses of any annual audit and the fees
and expenses of any Person, including special experts, retained
by the Company.
(b) In connection with any Registration Statement
required by this Agreement, the Company agrees to reimburse the
Purchasers and the Holders of Transfer Restricted Securities
being registered pursuant to the Shelf Registration Statement
(or, to the extent applicable, being tendered in the Exchange
Offer and/or resold pursuant to the "Plan of Distribution"
contained in the Exchange Offer Registration Statement) for the
reasonable fees and disbursements of not more than one counsel,
who shall be Xxxxxxx Xxxxxxx & Xxxxxxxx or such other counsel as
may be chosen by the Holders of a majority in principal amount of
the Transfer Restricted Securities for whose benefit such
Registration Statement is being prepared.
SECTION 6. INDEMNIFICATION
(a) The Company agrees to indemnify and hold harmless
(i) each Holder and (ii) each person, if any, who controls
(within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act) any Holder (any of the persons referred to in this
clause (ii) being hereinafter referred to as a "controlling
person") and (iii) the respective officers, directors, partners,
employees, representatives and agents of any Holder or any
controlling person (any person referred to in clause (i), (ii) or
(iii) may hereinafter be referred to as an "Indemnified Holder"),
to the fullest extent lawful, from and against any and all
losses, claims, damages, liabilities, judgments, costs and
expenses ("Losses") (including, without limitation and as
incurred, reimbursement of all costs of investigating, preparing,
pursuing or defending any claim or action, or any investigation
or proceeding by any governmental agency or body, commenced or
threatened, including the reasonable fees and expenses of counsel
to any Indemnified Holder) directly or indirectly caused by,
related to, based upon, arising out of or in connection with any
untrue statement or alleged untrue statement of a material fact
contained in any Registration Statement or Prospectus (or any
amendment or supplement thereto) or 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 are caused by an untrue statement
or omission or alleged untrue statement or omission that is made
in reliance upon and in conformity with information relating to
any of the Holders furnished in writing to the Company by any of
the Holders for use therein. The Company shall notify the
Holders promptly of the institution, threat or assertion of any
claim, proceeding (including any governmental investigation) or
litigation in connection with the matters addressed by this
Agreement which involves the Company or any Indemnified Holder.
(b) In case any action or proceeding (including,
without limitation, any governmental or regulatory investigation
or proceeding) shall be brought or asserted against any of the
Indemnified Holders with respect to which indemnity may be sought
against the Company, such Indemnified Holder (or the Indemnified
Holder controlled by such controlling person) shall promptly
notify the Company in writing (provided that the failure to give
such notice shall not relieve the Company of its obligations
pursuant to this Agreement). Any Indemnified Holder shall have
the right to employ separate counsel in any such action and
participate in the defense thereof, but the fees and expenses of
such counsel shall be at the expense of such Indemnified Holder,
provided, however, that the fees and expenses of such counsel
shall be at the expense of the Company if (i) the Company has
failed to assume the defense and employ counsel reasonably
satisfactory to the Holders or (ii) the named parties to any such
action (including any impleaded parties) include such indemnified
Holder and the Company and such Indemnified Holder shall have
reasonably concluded that there may be one or more legal defenses
available to it that are different from or in addition to those
available to the Company; provided, further that the Company
shall not in such event be responsible hereunder for the fees and
expenses of more than one firm of separate counsel, which firm
shall be designated by the Holders, in connection with any action
in the same jurisdiction, in addition to any local counsel. The
Company shall not be liable for any settlement of any such action
or proceeding effected with its prior written consent, which
consent shall not be unreasonably withheld or delayed, and the
Company agrees to indemnify and hold harmless any Indemnified
Holder from and against any Loss by reason of any settlement of
any action effected with its written consent. The Company shall
not, without the prior written consent of each Indemnified
Holder, settle or compromise or consent to the entry of a
judgment in or otherwise seek to terminate any pending or
threatened action, claim, litigation or proceeding in respect of
which indemnification or contribution may be sought hereunder
(whether or not any Indemnified Holder is a party thereto),
unless such settlement, compromise, consent or termination
includes an unconditional release of each Indemnified Holder from
all liability arising out of such action, claim, litigation or
proceeding.
(c) Each Holder of Transfer Restricted Securities
agrees, severally and not jointly, to indemnify and hold harmless
the Company, its directors, its officers, and any person
controlling (within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act) the Company, and the respective
officers, directors, partners, employees, representatives and
agents of each such person, to the same extent as the foregoing
indemnity from the Company to each of the Indemnified Holders,
but only with respect to claims and actions based on information
relating to such Holder furnished in writing by such Holder for
use in any Registration Statement or Prospectus. In case any
action or proceeding shall be brought against any of Company or
its directors or officers or any such controlling person in
respect of which indemnity may be sought against a Holder of
Transfer Restricted Securities, such Holder shall have the rights
and duties given the Company, and each of the Company or its
directors or officers of such controlling person shall have the
rights and duties given to each Holder by the proceeding
paragraph. In no event shall the liability or any selling Holder
hereunder be greater in amount than the dollar amount of the
proceeds received by such Holder upon the sale of the securities
registered pursuant to provisions hereof giving rise to such
indemnification obligation.
(d) If the indemnification provided for in this
Section 6 is unavailable to a party entitled to indemnification
in respect of any Losses referred to herein, then each
indemnifying party, in lieu of indemnifying such indemnified
party, shall contribute to the amount paid or payable by such
indemnified party as a result of such Losses (i) in such
proportion as is appropriate to reflect the relative benefits
received by the Company on the one hand and the Holders on the
other hand from their sale of Transfer Restricted Securities or
(ii) if such allocation is not permitted by applicable law, the
relative fault of the Company on the one hand and of the
Indemnified Holder on the other in connection with the statements
or omissions which resulted in such Losses as well as any other
relevant equitable considerations. The relative fault of the
Company on the one hand and of the Indemnified Holder on the
other shall be determined by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact
relates to information supplied by the Company or by the
Indemnified Holder and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such
statement or omission. The indemnity and contribution
obligations of each indemnifying party set forth herein shall be
in addition to any liability or obligation such indemnifying
party may otherwise have to any indemnified party.
The Company and each Holder of Transfer Restricted
Securities agree that it would not be just and equitable if
contribution pursuant to this Section 6(d) were 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 account of the equitable considerations referred to in
the immediately preceding paragraph. The amount paid or payable
by an indemnified party as a result of the Losses referred to in
the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, 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 Xxxxxxx 0, xxxx of
the Holders (and their related Indemnified Holders) shall be
required to contribute, in the aggregate, any amount in excess of
the amount by which the total proceeds received by such Holder
with respect to the Notes exceeds the amount of any damages which
such Holder 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 Act) shall be
entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The Holders' obligations to
contribute pursuant to this Section 6(d) are several in
proportion to the respective principal amount of Notes held by
each of the Holders hereunder and not joint.
SECTION 7. RULE 144A
The Company hereby agrees with each Holder, for so long
as any Transfer Restricted Securities remain outstanding, to make
available to any Holder or beneficial owner of Transfer
Restricted Securities in connection with any sale thereof and any
prospective purchase of such Transfer Restricted Securities from
such Holder or beneficial owner, any information required to be
supplied to a Holder by Rule 144A(d)(4) under the Act in order to
permit offers and sales of such Transfer Restricted Securities
pursuant to Rule 144A.
SECTION 8. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS
No Holder may participate in any Underwritten
Registration hereunder unless such Holder (a) agrees to sell such
Holder's Transfer Restricted Securities on the basis provided in
any underwriting arrangements approved by the Persons entitled
hereunder to approve such arrangements and (b) completes and
executes all reasonable questionnaires, powers of attorney,
indemnities, underwriting agreements, lock-up letters and other
documents required under the terms of such underwriting
arrangements.
SECTION 9. SELECTION OF UNDERWRITERS
The Holders of Transfer Restricted Securities covered
by the Shelf Registration Statement who desire to do so may sell
such Transfer Restricted Securities in an Underwritten Offering.
In any such Underwritten Offering, the investment banker or
investment bankers and manager or managers that will administer
the offering will be selected by the Holders of a majority in
aggregate principal amount of the Transfer Restricted Securities
included in such offering; provided, that such investment bankers
and managers must be reasonably satisfactory to the Company.
SECTION 10. MISCELLANEOUS
(a) Remedies. The Company agrees that monetary
damages would not be adequate compensation for any loss incurred
by reason of a breach by it of the provisions of this Agreement
and hereby agrees to waive the defense in any action for specific
performance that a remedy at law would be adequate.
(b) No Inconsistent Agreements. The Company will not,
on or after the date of this Agreement, enter into any agreement
with respect to its securities that is inconsistent with the
rights granted to the Holders in this Agreement or otherwise
conflicts with the provisions hereof. The rights granted to the
Holders hereunder are not inconsistent with the rights granted to
the holders of the Company's securities under any agreement in
effect on the date hereof.
(c) Amendments and Waivers. The provisions of this
Agreement may not be amended, modified or supplemented, and
waivers or consents to or departures from the provisions hereof
may not be given, unless the Company has obtained the written
consent of Holders of a majority of the outstanding principal
amount of Transfer Restricted Securities.
(d) Notices. All 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 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:
SoftKey International Inc.
Xxx Xxxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Attention: General Counsel
with a copy to:
Skadden, Arps, Slate Xxxxxxx & Xxxx
Xxx Xxxxxx Xxxxxx
Xxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxx
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 a courier guaranteeing
overnight delivery.
Copies of all such notices, demands or other
communications shall be concurrently delivered by the Person
giving the same to the Trustee at the address specified in the
Indenture.
(e) Successors and Assigns. This Agreement shall
inure to the benefit of and be binding upon the successors and
assigns of each of the parties, including without limitation and
without the need for an express assignment, subsequent Holders of
Transfer Restricted Securities; provided, however, that this
Agreement shall not inure to the benefit of or be binding upon a
successor or assign of a Holder unless and to the extent such
successor or assign acquired Transfer Restricted Securities from
such Holder.
(f) Counterparts. This Agreement may be executed in
any number of counterparts and by the parties hereto in separate
counterparts, each of which when so executed shall be deemed to
be an original and all of which taken together shall constitute
one and the same agreement.
(g) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise
affect the meaning hereof.
(h) Governing Law. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO THE CONFLICT OF LAW RULES THEREOF.
(i) Severability. In the event that any one or more
of the provisions contained herein, or the application thereof in
any circumstance, is held invalid, illegal or unenforceable, the
validity, legality and enforceability of any such provision in
every other respect and the remaining provisions contained herein
shall not be affected or impaired thereby.
(j) Entire Agreement. This Agreement, together with
the other Transaction 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 with respect to the
Transfer Restricted Securities. This Agreement supersedes all
prior agreements and understandings between the parties with
respect to such subject matter.
IN WITNESS WHEREOF, the parties have executed this
Agreement as of the date first written above.
SOFTKEY INTERNATIONAL INC.
By:___________________________
Name:
Title:
BEAR, XXXXXXX & CO. INC.
By:_______________________
Name:
Title:
XXXXXXXXXX SECURITIES
By:_______________________
Name:
Title:
NOTE RESALE REGISTRATION RIGHTS AGREEMENT
Dated as of October 23, 1995
by and among
SOFTKEY INTERNATIONAL INC.
and
BEAR, XXXXXXX & CO. INC.
XXXXXXXXXX SECURITIES
November 22, 1995
Bear, Xxxxxxx & Co. Inc.
Xxxxxxxxxx Securities
c/o Bear, Xxxxxxx & Co. Inc.
000 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
This letter is written in connection with the offering
of $350,000,000 5 1/2% Senior Convertible Notes Due 2000 by
SoftKey International Inc. (the "Company") and the Note Resale
Registration Rights Agreement (the "Note Resale Registration
Rights Agreement"), dated October 23, 1995, among the Company,
Bear, Xxxxxxx & Co. Inc. and Xxxxxxxxxx Securities (collectively,
the "Initial Purchasers"). Capitalized terms used herein and not
otherwise defined shall have the meanings given to them in the
the Note Resale Registration Rights Agreement.
1. The Company and the Initial Purchasers hereby
agree to amend the definition of "Transfer Restricted Securities"
contained in Section 1 of the Note Resale Registration Rights
Agreement by deleting such definition in its entirety and
substituting the following:
"Transfer Restricted Securities: Each Note (other than
any Note represented by the Regulation S Global Note or any
definitive Note not bearing the legend required by Section 2.5(d)
of the Indenture), and any Common Stock issued upon conversion of
any such Note, until the earliest to occur of (a) the date on
which such Note or Common Stock, as the case may be, has been
effectively registered under the Act and disposed of in
accordance with an effective Shelf Registration Statement, (b)
the date on which such Note is exchanged for a New Note in the
Exchange Offer and entitled to be resold to the public by the
Holder thereof without complying with the prospectus delivery
requirements of the Act, (c) the date on which such New Note or
Common Stock, as the case may be, is distributed to the public
pursuant to Rule 144 under the Act or by a Broker-Dealer pursuant
to the "Plan of Distribution" contemplated by the Exchange Offer
Registration Statement (including delivery of the Prospectus
contained therein), and (d) the date on which such Note is
converted into Common Stock in accordance with the terms and
provisions of the Note and the Indenture."
2. Except as expressly modified hereby, all the
provisions of the Note Resale Registration Rights Agreement are
and shall continue to be in full force and effect. Each
reference in the Note Resale Registration Rights Agreement to
"this Agreement", "hereunder", "hereof" and words of like import
referring to the Note Resale Registration Rights Agreement and
each reference in any other transaction documents relating
thereto shall mean the Note Resale Registration Rights Agreement
as amended hereby.
If the above correctly reflects your understanding and
agreement with respect to the foregoing matters, please so
confirm by signing the enclosed copy of this letter agreement.
SOFTKEY INTERNATIONAL INC.
By:
Name:
Title:
Accepted:
BEAR, XXXXXXX & CO. INC.
By:
Name:
Title:
XXXXXXXXXX SECURITIES
By:
Name:
Title:
