Exhibit 4.2
Execution Copy
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REGISTRATION RIGHTS AGREEMENT
Dated as of May 28, 2003
Among
OMNOVA SOLUTIONS INC.
and
DEUTSCHE BANK SECURITIES INC.,
BANC ONE CAPITAL MARKETS, INC.
and
McDONALD INVESTMENTS INC.,
as Initial Purchasers
11-1/4 Senior Secured Notes due 2010
TABLE OF CONTENTS
Page
----
1. Definitions.............................................................1
2. Exchange Offer..........................................................5
3. Shelf Registration......................................................9
4. Additional Interest....................................................11
5. Registration Procedures................................................12
6. Registration Expenses..................................................22
7. Indemnification and Contribution.......................................23
8. Rules 144 and 144A.....................................................27
9. Underwritten Registrations.............................................27
10. Miscellaneous..........................................................28
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REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is dated as of
May 28, 2003, between OMNOVA SOLUTIONS INC., an Ohio corporation (the "Company"
and together with the Guarantors (as defined below), if any, the "Issuers"), and
DEUTSCHE BANK SECURITIES INC., BANC ONE CAPITAL MARKETS, INC. AND McDONALD
INVESTMENTS, INC., as initial purchasers (the "Initial Purchasers").
This Agreement is entered into in connection with the Purchase
Agreement by and among the Company and the Initial Purchasers, dated as of May
16, 2003 (the "Purchase Agreement"), which provides for, among other things, the
sale by the Company to the Initial Purchasers of $165,000,000 aggregate
principal amount of the Company's 11-1/4% Senior Secured Notes due 2010 (the
"Notes"). The Notes and the Guarantees, if any, are collectively referenced to
herein as the "Securities". In order to induce the Initial Purchasers to enter
into the Purchase Agreement, the Company has agreed to provide the registration
rights set forth in this Agreement for the benefit of the Initial Purchasers and
any subsequent holder or holders of the Securities. The execution and delivery
of this Agreement is a condition to the Initial Purchasers' obligation to
purchase the Securities 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(a) hereto.
Advice: See the last paragraph of Section 5 hereto.
Agreement: See the introductory paragraphs hereto.
Applicable Period: See Section 2(b) hereto.
Business Day: Any day that is not a Saturday, Sunday or a day on which
banking institutions in New York are authorized or required by law to be closed.
Blackout Period: See Section 3(d) hereto.
Company: See the introductory paragraphs hereto.
Effectiveness Date: With respect to (i) the Exchange Offer
Registration Statement, the 180th day after the Issue Date and (ii) any Shelf
Registration Statement, the
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180th day after the delivery of a Shelf Notice as required by Section 2(c)
hereof; provided, however, that if the Effectiveness Date would otherwise fall
on a day that is not a Business Day, then the Effectiveness Date shall be the
next succeeding Business Day.
Effectiveness Period: See Section 3(a) hereto.
Event Date: See Section 4 hereto.
Exchange Act: The Securities Exchange Act of 1934, as amended, and the
rules and regulations of the SEC promulgated thereunder.
Exchange Notes: See Section 2(a) hereto.
Exchange Offer: See Section 2(a) hereto.
Exchange Offer Registration Statement: See Section 2(a) hereto.
Filing Date: (A) If no Registration Statement has been filed by the
Company pursuant to this Agreement, the 90th day after the Issue Date; and (B)
in any other case (which may be applicable notwithstanding the consummation of
the Exchange Offer), the 90th day after the delivery of a Shelf Notice as
required pursuant to Section 2(c) hereof; provided, however, that if the Filing
Date would otherwise fall on a day that is not a Business Day, then the Filing
Date shall be the next succeeding Business Day.
Guarantee: A guarantee of the Notes guaranteed by an entity (each such
entity, a "Guarantor") that executes a supplemental indenture pursuant to which
such entity agrees to guarantee the Notes.
Guarantor: See the definition of Guarantee.
Holder: Any holder of a Registrable Note or Registrable Notes.
Indenture: The Indenture, dated as of May 28, 2003, by and between the
Company 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.
Information: See Section 5(o) hereto.
Initial Purchasers: See the introductory paragraphs hereto.
Initial Shelf Registration: See Section 3(a) hereto.
Inspectors: See Section 5(o) hereto.
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Issue Date: May 28, 2003, the date of original issuance of the Notes.
Issuers: See the introductory paragraphs hereto.
NASD: See Section 5(s) hereto.
Notes: See the introductory paragraphs hereto.
Participant: See Section 7(a) hereto.
Participating Broker-Dealer: See Section 2(b) hereto.
Person: An individual, trustee, corporation, partnership, limited
liability company, joint stock company, trust, unincorporated association,
union, business association, firm or other legal entity.
Private Exchange: See Section 2(b) hereto.
Private Exchange Notes: See Section 2(b) hereto.
Prospectus: The prospectus included in any Registration Statement
(including, without limitation, any prospectus subject to completion and a
prospectus that includes any information previously omitted from a prospectus
filed as part of an effective registration statement in reliance upon Rule 430A
under the Securities Act and any term sheet filed pursuant to Rule 434 under the
Securities Act), as amended or supplemented by any prospectus supplement, and
all other amendments and supplements to the Prospectus, including post-effective
amendments, and all material incorporated by reference or deemed to be
incorporated by reference in such Prospectus.
Purchase Agreement: See the introductory paragraphs hereto.
Records: See Section 5(o) hereto.
Registrable Notes: Each Note (and the related Guarantee, if any) upon
its original issuance and at all times subsequent thereto, each Exchange Note
(and the related guarantees, if any) as to which Section 2(c)(iv) hereof is
applicable upon original issuance and at all times subsequent thereto and each
Private Exchange Note (and the related guarantees, if any) upon original
issuance thereof and at all times subsequent thereto, until, in each case, the
earliest to occur of (i) a Registration Statement (other than, with respect to
any Exchange Note as to which Section 2(c)(iv) hereof is applicable, the
Exchange Offer Registration Statement) covering such Note, Exchange Note or
Private Exchange Note has been declared effective by the SEC and such Note,
Exchange Note or such Private Exchange Note (and the related guarantees, if
any), as the case may be, has been disposed of in accordance with such effective
Registration Statement, (ii) such Note has been exchanged pursuant to the
Exchange
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Offer for an Exchange Note or Private Exchange Note (and the related guarantees,
if any) that may be resold without restriction under state and federal
securities laws, (iii) such Note, Exchange Note or Private Exchange Note (and
the related guarantees, if any), as the case may be, ceases to be outstanding
for purposes of the Indenture or (iv) such Note, Exchange Note or Private
Exchange Note (and the related guarantee, if any), as the case may be, may be
resold without restriction pursuant to Rule 144(k) (as amended or replaced)
under the Securities Act.
Registration Statement: Any registration statement of the Company that
covers any of the Notes, the Exchange Notes or the Private Exchange Notes (and
the related guarantees, if any) filed with the SEC under the Securities Act,
including the Prospectus, amendments and supplements to such registration
statement, including post-effective amendments, all exhibits, and all material
incorporated by reference or deemed to be incorporated by reference in such
registration statement.
Rule 144: Rule 144 under the Securities Act.
Rule 144A: Rule 144A under the Securities Act.
Rule 405: Rule 405 under the Securities Act.
Rule 415: Rule 415 under the Securities Act.
Rule 424: Rule 424 under the Securities Act.
SEC: The United States Securities and Exchange Commission or any
successor agency thereto.
Securities: See the introductory paragraphs hereto.
Securities Act: The Securities Act of 1933, as amended, and the rules
and regulations of the SEC promulgated thereunder.
Shelf Notice: See Section 2(c) hereto.
Shelf Registration: See Section 3(b) hereto.
Shelf Registration Statement: Any Registration Statement relating to a
Shelf Registration.
Subsequent Shelf Registration: See Section 3(b) hereto.
TIA: The Trust Indenture Act of 1939, as amended.
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Trustee: The trustee under the Indenture and the trustee (if any)
under any indenture governing the Exchange Notes and Private Exchange Notes (and
the related guarantees, if any).
Underwritten registration or underwritten offering: A registration in
which securities of one or more of the Issuers are sold to an underwriter for
reoffering to the public.
Except as otherwise specifically provided, all references in this
Agreement to acts, laws, statutes, rules, regulations, releases, forms,
no-action letters and other regulatory requirements (collectively, "Regulatory
Requirements") shall be deemed to refer also to any amendments thereto and all
subsequent Regulatory Requirements adopted as a replacement thereto having
substantially the same effect therewith; provided that Rule 144 shall not be
deemed to amend or replace Rule 144A.
2. Exchange Offer
(a) Unless the Exchange Offer would violate applicable law or any
applicable interpretation of the staff of the SEC, the Company shall use
its reasonable best efforts to file with the SEC, no later than the Filing
Date, a Registration Statement (the "Exchange Offer Registration
Statement") on an appropriate registration form with respect to a
registered offer (the "Exchange Offer") to exchange any and all of the
Notes for a like aggregate principal amount of debt securities of the
Company (the "Exchange Notes"), guaranteed by the Guarantors, if any, that
are identical in all material respects to the Notes (except that (i) the
Exchange Notes shall contain no restrictive legend thereon, (ii) interest
thereon shall accrue from (A) the last date on which interest was paid on
the Notes or (B) if no such interest has been paid, from the Issue Date,
and (iii) except with respect to Exchange Notes as to which clause 2(c)(iv)
applies, the Exchange Notes shall not be entitled to Additional Interest as
set forth in Section 4 hereof) and which are entitled to the benefits of
the Indenture or a trust indenture which is identical in all material
respects to the Indenture (other than such changes to the Indenture or any
such identical trust indenture as are necessary to comply with the TIA) and
which, in either case, has been qualified under the TIA. The Exchange Offer
shall comply with all applicable tender offer rules and regulations under
the Exchange Act and other applicable laws. The Company shall use its
reasonable best efforts to (x) cause the Exchange Offer Registration
Statement to be declared effective under the Securities Act on or before
the Effectiveness Date; (y) keep the Exchange Offer open for at least 30
days (or longer if required by applicable law) after the date that notice
of the Exchange Offer is mailed to Holders; and (z) consummate the Exchange
Offer on or prior to the 210th day following the Issue Date. If, after the
Exchange Offer Registration Statement is initially declared effective by
the SEC, the Exchange Offer or the issuance of the Exchange Notes
thereunder is interfered with by any stop order, injunction or other order
or
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requirement of the SEC or any other governmental agency or court, the
Exchange Offer Registration Statement shall be deemed not to have become
effective for purposes of this Agreement, unless such interference is cured
within fifteen Business Days.
Each Holder (including, without limitation, each Participating
Broker-Dealer) who participates in the Exchange Offer will be required to
represent to the Company in writing (which may be contained in the applicable
letter of transmittal) that: (i) any Exchange Notes acquired in exchange for
Notes tendered are being acquired in the ordinary course of business of the
Person receiving such Exchange Notes, whether or not such recipient is such
Holder itself; (ii) at the time of the commencement or consummation of the
Exchange Offer neither such Holder nor, to the actual knowledge of such Holder,
any other Person receiving Exchange Notes from such Holder has an arrangement or
understanding with any Person to participate in the distribution of the Exchange
Notes within the meaning of the Securities Act; (iii) neither such Holder nor,
to the actual knowledge of such Holder, any other Person receiving Exchange
Notes from such Holder is an "affiliate" (as defined in Rule 405) of the Company
or, if it is an affiliate of the Company, it will comply with the registration
and prospectus delivery requirements of the Securities Act to the extent
applicable and will provide information to be included in the Shelf Registration
Statement in accordance with Section 5 hereof in order to have their Notes
included in the Shelf Registration Statement and benefit from the provisions
regarding Additional Interest in Section 4 hereof; (iv) neither such Holder nor,
to the actual knowledge of such Holder, any other Person receiving Exchange
Notes from such Holder is engaging in or intends to engage in a distribution of
the Exchange Notes; and (v) if such Holder is a Participating Broker-Dealer,
such Holder has acquired the Notes as a result of market-making activities or
other trading activities and that it will comply with the applicable provisions
of the Securities Act (including, but not limited to, the prospectus delivery
requirements thereunder).
Upon consummation of the Exchange Offer in accordance with this
Section 2, the provisions of this Agreement shall continue to apply solely with
respect to Registrable Notes that are Private Exchange Notes, Exchange Notes as
to which Section 2(c)(iv) is applicable and Exchange Notes held by Participating
Broker-Dealers, and the Company shall have no further obligation to register
Registrable Notes (other than Private Exchange Notes and Exchange Notes as to
which clause 2(c)(iv) hereof applies) pursuant to this Agreement.
No securities other than the Exchange Notes shall be included in the
Exchange Offer Registration Statement.
(b) The Company shall include within the Prospectus contained in the
Exchange Offer Registration Statement a section entitled "Plan of
Distribution," reasonably acceptable to the Initial Purchasers, which shall
contain a summary statement of the positions taken or policies made by the
staff of the SEC with respect
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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 Notes 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 represent the prevailing views of the staff of the SEC. Such "Plan
of Distribution" section shall also expressly permit, to the extent
permitted by applicable policies and regulations of the SEC, the use of the
Prospectus by all Persons subject to the prospectus delivery requirements
of the Securities Act, including, to the extent permitted by applicable
policies and regulations of the SEC, all Participating Broker-Dealers, and
include a statement describing the means by which Participating
Broker-Dealers may resell the Exchange Notes in compliance with the
Securities Act.
The Company shall use its reasonable best efforts to keep the Exchange
Offer Registration Statement effective and to amend and supplement the
Prospectus contained therein in order to permit such Prospectus to be lawfully
delivered by all Persons subject to the prospectus delivery requirements of the
Securities Act for such period of time as is necessary to comply with applicable
law in connection with any resale of the Exchange Notes; provided, however, that
such period shall not be required to exceed 90 days or such longer period if
extended pursuant to the last paragraph of Section 5 hereof (the "Applicable
Period").
If, prior to consummation of the Exchange Offer, the Initial
Purchasers hold any Notes acquired by them that have the status of an unsold
allotment in the initial distribution, the Company upon the request of the
Initial Purchasers shall simultaneously with the delivery of the Exchange Notes
issue and deliver to the Initial Purchasers, in exchange (the "Private
Exchange") for such Notes held by any such Holder, a like principal amount of
notes (the "Private Exchange Notes") of the Company, guaranteed by the
Guarantors, if any, that are identical in all material respects to the Exchange
Notes except for the placement of a restrictive legend on such Private Exchange
Notes. The Private Exchange Notes shall be issued pursuant to the same indenture
as the Exchange Notes and bear the same CUSIP number as the Exchange Notes.
In connection with the Exchange Offer, the Company shall:
(1) mail, or cause to be mailed, to each Holder of record entitled to
participate in the Exchange Offer a copy of the Prospectus forming part of
the Exchange Offer Registration Statement, together with an appropriate
letter of transmittal and related documents;
(2) use its reasonable best efforts to keep the Exchange Offer open
for not less than 30 days after the date that notice of the Exchange Offer
is mailed to Holders (or longer if required by applicable law);
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(3) utilize the services of a depositary for the Exchange Offer with
an address in the Borough of Manhattan, The City of New York;
(4) permit Holders to withdraw tendered Securities at any time prior
to the close of business, New York time, on the last Business Day on which
the Exchange Offer remains open; and
(5) otherwise comply in all material respects with all applicable
laws, rules and regulations.
As soon as practicable after the close of the Exchange Offer and the
Private Exchange, if any, the Company shall:
(1) accept for exchange all Notes validly tendered and not validly
withdrawn pursuant to the Exchange Offer and the Private Exchange, if any;
(2) deliver to the Trustee for cancellation all Notes so accepted for
exchange; and
(3) cause the Trustee to authenticate and deliver promptly to each
Holder of Notes, Exchange Notes or Private Exchange Notes, as the case may
be, equal in principal amount to the Notes of such Holder so accepted for
exchange; provided that, in the case of any Notes held in global form by a
depositary, authentication and delivery to such depositary of one or more
replacement Notes in global form in an equivalent principal amount thereto
for the account of such Holders in accordance with the Indenture shall
satisfy such authentication and delivery requirement.
The Exchange Offer and the Private Exchange shall not be subject to
any conditions, other than that (i) the Exchange Offer or Private Exchange, as
the case may be, does not violate applicable law or any applicable
interpretation of the staff of the SEC; (ii) no action or proceeding against the
Issuers shall have been instituted or threatened in any court or by any
governmental agency which might materially impair the ability of the Company to
proceed with the Exchange Offer or the Private Exchange, and no material adverse
development shall have occurred in any existing action or proceeding with
respect to the Company; and (iii) all governmental approvals that the Company
deems necessary for the consummation of the Exchange Offer or Private Exchange
shall have been obtained.
The Exchange Notes and the Private Exchange Notes shall be issued
under (i) the Indenture or (ii) an indenture identical in all material respects
to the Indenture and which, in either case, has been qualified under the TIA or
is exempt from such qualification and shall provide that the Exchange Notes
shall not be subject to the transfer restrictions set forth in the Indenture.
The Indenture or such indenture shall provide that the Exchange Notes, the
Private Exchange Notes and the Notes shall vote and consent together on all
matters as
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one class and that none of the Exchange Notes, the Private Exchange Notes or the
Securities will have the right to vote or consent as a separate class on any
matter.
(c) If, (i) because of any change in law or in currently prevailing
interpretations of the staff of the SEC, the Company is not permitted to
effect the Exchange Offer, (ii) the Exchange Offer is not consummated
within 210 days of the Issue Date, (iii) the Initial Purchasers or any
holder of Private Exchange Notes so requests in writing to the Company at
any time after the consummation of the Exchange Offer, or (iv) in the case
of any Holder that participates in the Exchange Offer, such Holder does not
receive Exchange Notes on the date of the exchange that may be sold without
restriction under state and federal securities laws (other than due solely
to the status of such Holder as an affiliate of the Issuers within the
meaning of the Securities Act) and so notifies the Company within 60 days
after such Holder first becomes aware of such restrictions, in the case of
each of clauses (i) to and including (iv) of this sentence, then the
Company shall promptly deliver to the Holders and the Trustee written
notice thereof (the "Shelf Notice") and shall file a Shelf Registration
pursuant to Section 3 hereof.
3. Shelf Registration.
If at any time a Shelf Notice is delivered as contemplated by Section
2(c) hereof, then:
(a) Shelf Registration. The Company shall file with the SEC a
Registration Statement for an offering to be made on a continuous basis
pursuant to Rule 415 covering all of the Registrable Notes (the "Initial
Shelf Registration"). The Company shall use its reasonable best efforts to
file with the SEC the Initial Shelf Registration on or prior to the
applicable Filing Date. The Initial Shelf Registration shall be on Form S-1
or another appropriate form permitting registration of such Registrable
Notes for resale by Holders in the manner or manners designated by them
(including, without limitation, one or more underwritten offerings). The
Company shall not permit any securities other than the Registrable Notes
and the Guarantees, if any, to be included in the Initial Shelf
Registration or any Subsequent Shelf Registration (as defined below).
The Company shall use its reasonable best efforts to cause the Shelf
Registration to be declared effective under the Securities Act on or prior
to the Effectiveness Date and to keep the Initial Shelf Registration
continuously effective under the Securities Act until the date that is two
years from the Issue Date or such shorter period ending when all
Registrable Notes covered by the Initial Shelf Registration have been sold
in the manner set forth and as contemplated in the Initial Shelf
Registration or, if applicable, a Subsequent Shelf Registration (the
"Effectiveness Period"); provided, however, that the Effectiveness Period
in respect of the Initial Shelf Registration shall be
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extended to the extent required to permit dealers to comply with the
applicable prospectus delivery requirements of Rule 174 under the
Securities Act and as otherwise provided herein.
(b) Withdrawal of Stop Orders; Subsequent Shelf Registrations. If the
Initial Shelf Registration or any Subsequent Shelf Registration ceases to
be effective for any reason at any time during the Effectiveness Period
(other than because of the sale of all of the Registrable Notes registered
thereunder), the Company shall use its reasonable best efforts to obtain
the prompt withdrawal of any order suspending the effectiveness thereof,
and in any event shall within 30 days of such cessation of effectiveness
amend such Shelf Registration Statement in a manner to obtain the
withdrawal of the order suspending the effectiveness thereof, or file an
additional Shelf Registration Statement pursuant to Rule 415 covering all
of the Registrable Notes covered by and not sold under the Initial Shelf
Registration or an earlier Subsequent Shelf Registration (each, a
"Subsequent Shelf Registration"). If a Subsequent Shelf Registration is
filed, the Company shall use its reasonable best efforts to cause the
Subsequent Shelf Registration to be declared effective under the Securities
Act as soon as practicable after such filing and to keep such subsequent
Shelf Registration continuously effective for a period equal to the number
of days in the Effectiveness Period less the aggregate number of days
during which the Initial Shelf Registration or any Subsequent Shelf
Registration was previously continuously effective. As used herein the term
"Shelf Registration" means the Initial Shelf Registration and any
Subsequent Shelf Registration.
(c) Supplements and Amendments. The Company shall promptly supplement
and amend the Shelf Registration if required by the rules, regulations or
instructions applicable to the registration form used for such Shelf
Registration, if required by the Securities Act, or if reasonably requested
by the Holders of a majority in aggregate principal amount of the
Registrable Notes (or their counsel) covered by such Registration Statement
with respect to the information included therein with respect to one or
more of such Holders, or by any underwriter of such Registrable Notes with
respect to the information included therein with respect to such
underwriter.
(d) Blackout Period. Notwithstanding anything to the contrary in this
Agreement, the Company, upon notice to the Holders of Registrable Notes,
may suspend the use of the Prospectus included in any Shelf Registration
Statement in the event that and for a period of time (the "Blackout
Period") not to exceed an aggregate of 60 days in any twelve month period
if (1) the Board of Directors of the Company determines that the disclosure
of an event at such time could reasonably be expected to have a material
adverse effect on the business, operations or prospects of the Company or
(2) the disclosure otherwise relates to a material business transaction
which has not
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been publicly disclosed and the Board of Directors of the Company
determines that any such disclosure would jeopardize the success of such
transaction; provided, that, upon the termination of such Blackout Period,
the Company promptly shall notify the Holders of Registrable Notes that
such Blackout Period has been terminated.
4. Additional Interest
(a) The Company and the Initial Purchasers agree that the Holders will
suffer damages if the Company fails to fulfill its obligations under
Section 2 or Section 3 hereof and that it would not be feasible to
ascertain the extent of such damages with precision. Accordingly, the
Company agrees to pay, jointly and severally, 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 (A) neither the Exchange Offer Registration Statement nor the
Initial Shelf Registration has been filed on or prior to the Filing Date
applicable thereto or (B) notwithstanding that the Company has consummated
or will consummate the Exchange Offer, the Company is required to file a
Shelf Registration and such Shelf Registration is not filed on or prior to
the Filing Date applicable thereto, then, commencing on the day after any
such Filing Date, Additional Interest shall accrue on the principal amount
of the Notes at a rate of 0.50% per annum for the first 90 days immediately
following such applicable Filing Date, and such Additional Interest rate
shall increase by an additional 0.50% per annum at the beginning of each
subsequent 90-day period; or
(ii) if (A) neither the Exchange Offer Registration Statement nor the
Initial Shelf Registration is declared effective by the SEC on or prior to
the Effectiveness Date applicable thereto or (B) notwithstanding that the
Company has consummated or will consummate the Exchange Offer, the Company
is required to file a Shelf Registration and such Shelf Registration is not
declared effective by the SEC on or prior to the Effectiveness Date
applicable to such Shelf Registration, then, commencing on the day after
such Effectiveness Date, Additional Interest shall accrue on the principal
amount of the Notes at a rate of 0.50% per annum for the first 90 days
immediately following the day after such Effectiveness Date, and such
Additional Interest rate shall increase by an additional 0.50% per annum at
the beginning of each subsequent 90-day period; or
(iii) if (A) the Company has not exchanged Exchange Notes for all
Notes validly tendered in accordance with the terms of the Exchange Offer
on or prior to the 210th day after the Issue Date or (B) if applicable, a
Shelf Registration has been declared effective and such Shelf Registration
ceases to be effective at any time on or after the Effectiveness Date and
during the Effectiveness Period (other than during any
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Blackout Period relating to such Shelf Registration), then Additional
Interest shall accrue on the principal amount of the Notes at a rate of
0.50% per annum for the first 90 days commencing on the (x) 211th day after
the Issue Date, in the case of (A) above, or (y) the day such Shelf
Registration ceases to be effective in the case of (B) above, and such
Additional Interest rate shall increase by an additional 0.50% per annum at
the beginning of each such subsequent 90-day period;
provided, however, that (a) the Additional Interest rate on the Notes may not
accrue under more than one of the foregoing clauses (i) - (iii) at any one time
and at no time shall the aggregate amount of additional interest accruing exceed
in the aggregate 1.0% per annum and (b) Additional Interest shall not accrue
under clause (iii) (B) above during the continuation of a Blackout Period;
provided, further, however, that (1) upon the filing of the applicable Exchange
Offer Registration Statement or the applicable Shelf Registration as required
hereunder (in the case of clause (i) above of this Section 4), (2) upon the
effectiveness of the Exchange Offer Registration Statement or the applicable
Shelf Registration Statement as required hereunder (in the case of clause (ii)
of this Section 4), or (3) upon the exchange of the Exchange Notes for all Notes
tendered (in the case of clause (iii)(A) of this Section 4), or upon the
effectiveness of the applicable Shelf Registration Statement which had ceased to
remain effective (in the case of (iii)(B) of this Section 4), Additional
Interest on the Notes in respect of which such events relate as a result of such
clause (or the relevant subclause thereof), as the case may be, shall cease to
accrue.
(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"). Any amounts of
Additional Interest due pursuant to (a)(i), (a)(ii) or (a)(iii) of this
Section 4 will be payable in cash semiannually on each June 1 and December
1 (to the holders of record on the May 15 and November 15 immediately
preceding such dates), commencing with the first such date occurring after
any such Additional Interest commences to accrue. The amount of Additional
Interest will be determined by multiplying the applicable Additional
Interest rate by the principal amount of the Registrable Notes, multiplied
by a fraction, the numerator of which is the number of days such Additional
Interest rate was applicable during such period (determined on the basis of
a 360day year comprised of twelve 30 day months and, in the case of a
partial month, the actual number of days elapsed), and the denominator of
which is 360.
5. Registration Procedures
In connection with the filing of any Registration Statement pursuant
to Section 2 or 3 hereof, the Company shall effect such registrations to permit
the sale of the securities covered thereby in accordance with the intended
method or methods of disposition
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thereof, and pursuant thereto and in connection with any Registration Statement
filed by the Company hereunder the Company shall:
(a) Prepare and file with the SEC on or prior to the applicable Filing
Date a Registration Statement or Registration Statements as prescribed by
Section 2 or 3 hereof, and use its reasonable best efforts to cause each
such Registration Statement to become effective and remain effective as
provided herein; provided, however, that if (1) such filing is pursuant to
Section 3 hereof or (2) a Prospectus contained in the Exchange Offer
Registration Statement filed pursuant to Section 2 hereof is required to be
delivered under the Securities Act by any Participating Broker-Dealer who
seeks to sell Exchange Notes during the Applicable Period relating thereto
from whom any Issuer has received written notice that it will be a
Participating Broker-Dealer in the Exchange Offer, before filing any
Registration Statement or Prospectus or any amendments or supplements
thereto, the Issuers shall furnish to and afford the Holders of the
Registrable Notes covered by such Registration Statement (with respect to a
Registration Statement filed pursuant to Section 3 hereof) or each such
Participating Broker-Dealer (with respect to any such Registration
Statement), as the case may be, their counsel and the managing
underwriters, if any, a reasonable opportunity to review copies of all such
documents (including copies of any documents to be incorporated by
reference therein and all exhibits thereto) proposed to be filed (in each
case at least five business days prior to such filing or such reasonable
date as is reasonable under the circumstances). The Company shall not file
any Registration Statement or Prospectus or any amendments or supplements
thereto if the Holders of a majority in aggregate principal amount of the
Registrable Notes covered by such Registration Statement, their counsel, or
the managing underwriters, if any, shall reasonably object on a timely
basis.
(b) Prepare and file with the SEC such amendments and post-effective
amendments to each Shelf Registration Statement or Exchange Offer
Registration Statement, as the case may be, as may be necessary to keep
such Registration Statement continuously effective for the Effectiveness
Period, the Applicable Period or until consummation of the Exchange Offer,
as the case may be; cause the related Prospectus to be supplemented by any
Prospectus supplement required by applicable law, and as so supplemented to
be filed pursuant to Rule 424; and comply with the provisions of the
Securities Act and the Exchange Act applicable to it with respect to the
disposition of all securities covered by such Registration Statement as so
amended or in such Prospectus as so supplemented and with respect to the
subsequent resale of any securities being sold by a Participating
Broker-Dealer covered by any such Prospectus; provided, that, to the extent
relating to a Shelf Registration Statement, none of the foregoing shall be
required during a Blackout Period. Other than during any Blackout Period
with respect to a Shelf Registration Statement, the Company shall be deemed
not to have used its reasonable best efforts to keep a Registration
Statement
-14-
effective if any Issuer voluntarily takes any action that would result in
selling Holders of the Registrable Notes covered thereby or Participating
Broker-Dealers seeking to sell Exchange Notes not being able to sell such
Registrable Notes or such Exchange Notes during that period unless such
action is required by applicable law or permitted by this Agreement.
(c) If (1) a Shelf Registration is filed pursuant to Section 3 hereof,
or (2) a Prospectus contained in the Exchange Offer Registration Statement
filed pursuant to Section 2 hereof is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period relating thereto from whom any
Issuer has received written notice that it will be a Participating
Broker-Dealer in the Exchange Offer, notify the selling Holders of
Registrable Notes (with respect to a Registration Statement filed pursuant
to Section 3 hereof), or each such Participating Broker-Dealer (with
respect to any such Registration Statement), as the case may be, their
counsel and the managing underwriters, if any, promptly (but in any event
within two business days), and confirm such notice in writing, (i) when a
Prospectus or any Prospectus supplement or post-effective amendment has
been filed, and, with respect to a Registration Statement or any
post-effective amendment, when the same has become effective under the
Securities Act (including in such notice a written statement that any
Holder may, upon request, obtain, at the sole expense of the Issuers, one
conformed copy of such Registration Statement or post-effective amendment
including financial statements and schedules, documents incorporated or
deemed to be incorporated by reference and exhibits), (ii) of the issuance
by the SEC of any stop order suspending the effectiveness of a Registration
Statement or of any order preventing or suspending the use of any
preliminary prospectus or the initiation of any proceedings for that
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
Notes or resales of Exchange Notes by Participating Broker-Dealers the
representations and warranties of the Issuers contained in any agreement
(including any underwriting agreement) contemplated by Section 5(n) hereof
cease to be true and correct, (iv) of the receipt by any Issuer of any
notification with respect to the suspension of the qualification or
exemption from qualification of a Registration Statement or any of the
Registrable Notes or the Exchange Notes 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, the existence of any condition or any information becoming known
that makes any statement made in such Registration Statement or related
Prospectus or any document incorporated or deemed to be incorporated
therein by reference untrue in any material respect or that requires the
making of any changes in or amendments or supplements to such Registration
Statement, Prospectus or documents so that, in the case of the Registration
Statement, it will not contain any untrue statement of a material fact or
omit to state any material fact required to be
-15-
stated therein or necessary to make the statements therein not misleading,
and that in the case of the Prospectus, it will not contain any untrue
statement of a material fact or omit to state any material fact required to
be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading, provided,
that such notice need not identify the reasons for such event, condition or
information that requires such change in the Registration Statement or
Prospectus and (vi) of the Company's determination that a post-effective
amendment to a Registration Statement would be appropriate.
(d) If (1) a Shelf Registration is held pursuant to Section 3 hereof,
or (2) a Prospectus contained in the Exchange Offer Registration Statement
filed pursuant to Section 2 hereof is required to be delivered under the
Securities act by any participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period, use its reasonable best
efforts to prevent the issuance of any order suspending the effectiveness
of a Registration Statement or of any order preventing or suspending the
use of a Prospectus or suspending the qualification (or exemption from
qualification) of any of the Registrable Notes or the Exchange Notes to be
sold by any Participating Broker-Dealer, for sale in any jurisdiction, and,
if any such order is issued, to use its reasonable best efforts to obtain
the withdrawal of any such order as soon as practicable.
(e) If a Shelf Registration is filed pursuant to Section 3 and if
requested during the Effectiveness Period by the managing underwriter or
underwriters (if any), the Holders of a majority in aggregate principal
amount of the Registrable Notes being sold in connection with an
underwritten offering or any Participating Broker-Dealer, (i) as promptly
as practicable incorporate in a prospectus supplement or post-effective
amendment such information as the managing underwriter or underwriters (if
any), such Holders, any Participating Broker-Dealer or counsel for any of
them reasonably request to be included therein, (ii) make all required
filings of such prospectus supplement or such post-effective amendment as
soon as practicable after the Company has received notification of the
matters to be incorporated in such prospectus supplement or post-effective
amendment, and (iii) supplement or make amendments to such Registration
Statement.
(f) If (1) a Shelf Registration is filed pursuant to Section 3 hereof,
or (2) a Prospectus contained in the Exchange Offer Registration Statement
filed pursuant to Section 2 hereof is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period, furnish to each selling Holder
of Registrable Notes (with respect to a Registration Statement filed
pursuant to Section 3 hereof) and to each such Participating Broker-Dealer
who so requests (with respect to any such Registration Statement) and to
their respective counsel and each managing underwriter, if any, at
-16-
the sole expense of the Company, one conformed copy of the Registration
Statement or Registration Statements and each post-effective amendment
thereto, including financial statements and schedules, and, if requested,
all documents incorporated or deemed to be incorporated therein by
reference and all exhibits.
(g) If (1) a Shelf Registration is filed pursuant to Section 3 hereof,
or (2) a Prospectus contained in the Exchange Offer Registration Statement
filed pursuant to Section 2 hereof is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period, deliver to each selling Holder
of Registrable Notes (with respect to a Registration Statement filed
pursuant to Section 3 hereof), or each such Participating Broker-Dealer
(with respect to any such Registration Statement), as the case may be,
their respective counsel, and the underwriters, if any, at the sole expense
of the Company, as many copies of the Prospectus or Prospectuses (including
each form of preliminary prospectus) and each amendment or supplement
thereto and any documents incorporated by reference therein as such Persons
may reasonably request; and, subject to the last paragraph of this Section
5, the Company hereby consents to the use of such Prospectus and each
amendment or supplement thereto by each of the selling Holders of
Registrable Notes 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 Notes covered by,
or the sale by Participating Broker-Dealers of the Exchange Notes pursuant
to, such Prospectus and any amendment or supplement thereto.
(h) Prior to any public offering of Registrable Notes or any delivery
of a Prospectus contained in the Exchange Offer Registration Statement by
any Participating Broker-Dealer who seeks to sell Exchange Notes during the
Applicable Period, use its reasonable best efforts to register or qualify,
and to cooperate with the selling Holders of Registrable Notes or each such
Participating Broker-Dealer, as the case may be, the managing underwriter
or underwriters, if any, and their respective counsel in connection with
the registration or qualification (or exemption from such registration or
qualification) of such Registrable Notes for offer and sale under the
securities or Blue Sky laws of such jurisdictions within the United States
as any selling Holder, Participating Broker-Dealer, or the managing
underwriter or underwriters reasonably request in writing; provided,
however, that where Exchange Notes held by Participating Broker-Dealers or
Registrable Notes are offered other than through an underwritten offering,
the Company agrees to cause its counsel to perform Blue Sky investigations
and file registrations and qualifications required to be filed pursuant to
this Section 5(h), keep each such registration or qualification (or
exemption therefrom) effective during the period such Registration
Statement is required to be kept effective and do any and all other acts or
things necessary or advisable to enable the disposition in such
jurisdictions of the Exchange Notes held by
-17-
Participating Broker-Dealers or the Registrable Notes covered by the
applicable Registration Statement; provided, however, that no Issuer 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 $1,000 in
any such jurisdiction where it is not then so subject.
(i) If a Shelf Registration is filed pursuant to Section 3 hereof,
cooperate with the selling Holders of Registrable Notes and the managing
underwriter or underwriters, if any, to facilitate the timely preparation
and delivery of certificates representing Registrable Notes 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 Notes to be in such denominations (subject to applicable
requirements contained in the Indenture) and registered in such names as
the managing underwriter or underwriters, if any, or Holders may request.
(j) Use its reasonable best efforts to cause the Registrable Notes
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 or underwriters, if
any, to consummate the disposition of such Registrable Notes, except as may
be required solely as a consequence of the nature of such selling Holder's
business, in which case the Issuers will cooperate in all respects with the
filing of such Registration Statement and the granting of such approvals.
(k) If (1) a Shelf Registration is filed pursuant to Section 3 hereof,
or (2) a Prospectus contained in the Exchange Offer Registration Statement
filed pursuant to Section 2 hereof is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period, upon the occurrence of any
event contemplated by paragraph 5(c)(v) or 5(c)(vi) hereof, as promptly as
practicable (except, in the case of a Shelf Registration, during a Blackout
Period) prepare and (subject to Section 5(a) hereof) file with the SEC, at
the sole expense of the Company, a supplement or post-effective amendment
to the 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 Notes being sold thereunder
(with respect to a Registration Statement filed pursuant to Section 3
hereof) or to the purchasers of the Exchange Notes to whom such Prospectus
will be delivered by a Participating Broker-Dealer (with respect to any
such Registration Statement), any such Prospectus will not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein
-18-
or necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading.
(l) Use its reasonable best efforts to cause the Registrable Notes
covered by a Registration Statement or the Exchange Notes, 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
Notes covered by such Registration Statement or the Exchange Notes, as the
case may be, or the managing underwriter or underwriters, if any.
(m) Prior to the effective date of the first Registration Statement
relating to the Registrable Notes, (i) provide the Trustee with
certificates for the Registrable Notes in a form eligible for deposit with
The Depository Trust Company and (ii) provide a CUSIP number for the
Registrable Notes.
(n) In connection with any underwritten offering of Registrable Notes
pursuant to a Shelf Registration, enter into an underwriting agreement as
is customary in underwritten offerings of debt securities similar to the
Securities, and take all such other actions as are reasonably requested by
the managing underwriter or underwriters in order to expedite or facilitate
the registration or the disposition of such Registrable Notes and, in such
connection, (i) make such representations and warranties to, and covenants
with, the underwriters with respect to the business of the Issuers
(including any acquired business, properties or entity, if applicable), 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 of
debt securities similar to the Securities, and confirm the same in writing
if and when requested; (ii) obtain the written opinions of counsel to the
Issuers, and written updates thereof in form, scope and substance
reasonably satisfactory to the managing underwriter or underwriters,
addressed to the underwriters covering the matters customarily covered in
opinions reasonably requested in underwritten offerings and such other
matters as may reasonably be requested by the managing underwriter or
underwriters; (iii) obtain "cold comfort" letters and updates thereof in
form, scope and substance reasonably satisfactory to the managing
underwriter or underwriters from the independent certified public
accountants of the Issuers (and, if necessary, any other independent
certified public accountants of the Issuers, or of any business acquired by
the Issuers, for which financial statements and financial data are, or are
required to be, included or incorporated by reference 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 of debt
securities similar to the Securities and such other matters as may
reasonably be requested by the managing underwriter or underwriters; and
(iv) if an
-19-
underwriting agreement is entered into, the same shall contain
indemnification provisions and procedures no less favorable to the sellers
and underwriters, if any, than those set forth in Section 7 hereof (or such
other provisions and procedures reasonably acceptable to Holders of a
majority in aggregate principal amount of Registrable Notes covered by such
Registration Statement and the managing underwriter or underwriters or
agents, if any). The above shall be done at each closing under such
underwriting agreement, or as and to the extent required thereunder.
(o) If (1) a Shelf Registration is filed pursuant to Section 3 hereof,
or (2) a Prospectus contained in the Exchange Offer Registration Statement
filed pursuant to Section 2 hereof is required to be delivered under the
Securities Act by any Participating Broker-Dealer who seeks to sell
Exchange Notes during the Applicable Period, make available for inspection
by any Initial Purchaser, any selling Holder of such Registrable Notes
being sold (with respect to a Registration Statement filed pursuant to
Section 3 hereof), or each such Participating Broker-Dealer, as the case
may be, any underwriter participating in any such disposition of
Registrable Notes, if any, and any attorney, accountant or other agent
retained by any such selling Holder or each such Participating
Broker-Dealer (with respect to any such Registration Statement), as the
case may be, or underwriter (any such Initial Purchasers, Holders,
Participating Broker-Dealers, underwriters, attorneys, accountants or
agents, collectively, the "Inspectors"), upon written request, at the
offices where normally kept, during reasonable business hours, all
pertinent financial and other records, pertinent corporate documents and
instruments of the Issuers and subsidiaries of the Issuers (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 Issuers and any of their respective
subsidiaries to supply all information ("Information") reasonably requested
by any such Inspector in connection with such due diligence
responsibilities. Each Inspector shall agree in writing that it will keep
the Records and Information confidential and that it will not disclose any
of the Records or Information that any Issuer determines, in good faith, to
be confidential and notifies the Inspectors in writing are confidential
unless (i) the disclosure of such Records or Information is necessary to
avoid or correct a misstatement or omission in such Registration Statement
or Prospectus, (ii) the release of such Records or Information is ordered
pursuant to a subpoena or other order from a court of competent
jurisdiction, (iii) disclosure of such Records or Information is necessary
or advisable, in the opinion of counsel for any Inspector, in connection
with any action, claim, suit or proceeding, directly or indirectly,
involving or potentially involving such Inspector and arising out of, based
upon, relating to, or involving this Agreement or the Purchase Agreement,
or any transactions contemplated hereby or thereby or arising hereunder or
thereunder, or (iv) the information in such Records or Information has been
made generally available to the public other than by an Inspector or an
"affiliate" (as defined in Rule 405) thereof; provided, however, that prior
notice
-20-
shall be provided as soon as reasonably practicable to any Issuer of the
potential disclosure of any information by such Inspector pursuant to
clauses (i), (ii) or (iii) of this sentence to permit the Issuers to obtain
a protective order (or waive the provisions of this paragraph (o)) and that
such Inspector shall take such actions as are reasonably necessary to
protect the confidentiality of such information (if practicable) to the
extent such action is otherwise not inconsistent with, an impairment of or
in derogation of the rights and interests of the Holder or any Inspector.
(p) Provide an indenture trustee for the Registrable Notes or the
Exchange Notes, as the case may be, and cause the Indenture or the trust
indenture provided for in Section 2(a) hereof, as the case may be, to be
qualified under the TIA not later than the effective date of the first
Registration Statement relating to the Registrable Notes; and in connection
therewith, cooperate with the trustee under any such indenture and the
Holders of the Registrable Notes, to effect such changes (if any) 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 its reasonable
best efforts to cause such trustee to execute, all documents as may be
required to effect such changes, and all other forms and documents required
to be filed with the SEC to enable such indenture to be so qualified in a
timely manner.
(q) Comply with all applicable rules and regulations of the SEC and
make generally available to its securityholders with regard to any
applicable Registration Statement a consolidated earnings statement
satisfying the provisions of Section 11(a) of the Securities Act and Rule
158 thereunder no later than 45 days after the end of any fiscal quarter
(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
Notes 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.
(r) If the Exchange Offer or a Private Exchange is to be consummated,
upon delivery of the Registrable Notes by Holders to the Company (or to
such other Person as directed by the Company), in exchange for the Exchange
Notes or the Private Exchange Notes, as the case may be, the Issuers shall
xxxx, or cause to be marked, on such Registrable Notes that such
Registrable Notes are being cancelled in exchange for the Exchange Notes or
the Private Exchange Notes, as the case may be; in no event shall such
Registrable Notes be marked as paid or otherwise satisfied.
(s) Cooperate with each seller of Registrable Notes covered by any
Registration Statement and each underwriter, if any, participating in the
disposition of such Registrable Notes and their respective counsel in
connection with any filings
-21-
required to be made with the National Association of Securities Dealers,
Inc. (the "NASD").
(t) Use its reasonable best efforts to take all other steps necessary
to effect the registration of the Exchange Notes and/or Registrable Notes
covered by a Registration Statement contemplated hereby.
The Issuers may require each seller of Registrable Notes as to which
any registration is being effected to furnish to the Issuers such information
regarding such seller and the distribution of such Registrable Notes as the
Issuers may, from time to time, reasonably request. The Issuers may exclude from
such registration the Registrable Notes of any seller so long as such seller
fails to furnish such information within a reasonable time after receiving such
request. Each seller as to which any Shelf Registration is being effected agrees
to furnish promptly to the Issuers all information required to be disclosed in
order to make the information previously furnished to the Issuers by such seller
not materially misleading.
If any such Registration Statement refers to any Holder by name or
otherwise as the holder of any securities of the Company, then such Holder shall
have the right to require (i) the insertion therein of language, in form and
substance reasonably satisfactory to such Holder, to the effect that the holding
by such Holder of such securities is not to be construed as a recommendation by
such Holder of the investment quality of the securities covered thereby and that
such holding does not imply that such Holder will assist in meeting any future
financial requirements of the Company, or (ii) in the event that such reference
to such Holder by name or otherwise is not required by the Securities Act or any
similar federal statute then in force, the deletion of the reference to such
Holder in any amendment or supplement to the Registration Statement filed or
prepared subsequent to the time that such reference ceases to be required.
Each Holder of Registrable Notes and each Participating Broker-Dealer
agrees by its acquisition of such Registrable Notes or Exchange Notes to be sold
by such Participating Broker-Dealer, as the case may be, that, upon actual
receipt of any notice from the Company (i) of the happening of any event of the
kind described in Section 5(c)(ii), 5(c)(iv), 5(c)(v), or 5(c)(vi) hereof or
(ii) of the commencement of a Blackout Period, such Holder will forthwith
discontinue disposition of such Registrable Notes covered by such Registration
Statement or Prospectus or Exchange Notes to be sold by such Holder or
Participating Broker-Dealer, as the case may be, until (x) in the case of the
immediately preceding clause (i), such Holder's or Participating Broker-Dealer's
receipt of the copies of the supplemented or amended Prospectus contemplated by
Section 5(k) hereof, or until it is advised in writing (the "Advice") by the
Issuers that the use of the applicable Prospectus may be resumed, and has
received copies of any amendments or supplements thereto or (y) in the case of
the immediately preceding clause (ii) the earlier of (A) 60 days of after the
commencement of such Blackout Period and (B) receipt of notice from the Company
that such Blackout Period has
-22-
ended. In the event that the Issuers shall give any such notice, each of the
Applicable Period and the Effectiveness Period shall be extended by the number
of days during such periods from and including the date of the giving of such
notice to and including the date when the requirements of the immediately
preceding clause (x) or (y), as the case may be, shall have been met.
6. Registration Expenses
All fees and expenses incident to the performance of or compliance
with this Agreement by the Issuers shall be borne by the Issuers (other than any
underwriting discounts or commissions in the event of an underwritten offering),
whether or not the Exchange Offer Registration Statement or any Shelf
Registration Statement is filed or becomes effective or the Exchange Offer is
consummated, including, without limitation, (i) all registration and filing fees
(including, without limitation, (A) fees with respect to filings required to be
made with the NASD in connection with an underwritten offering and (B) fees and
expenses of compliance with state securities or Blue Sky laws (including,
without limitation, fees and disbursements of counsel in connection with Blue
Sky qualifications of the Registrable Notes or Exchange Notes and determination
of the eligibility of the Registrable Notes or Exchange Notes for investment
under the laws of such jurisdictions (x) where the holders of Registrable Notes
are located, in the case of the Exchange Notes, or (y) as provided in Section
5(h) hereof, in the case of Registrable Notes or Exchange Notes to be sold by a
Participating Broker-Dealer during the Applicable Period)), (ii) printing
expenses, including, without limitation, expenses of printing certificates for
Registrable Notes or Exchange Notes in a form eligible for deposit with The
Depository Trust Company and of printing prospectuses if the printing of
prospectuses is reasonably requested by the managing underwriter or
underwriters, if any, by the Holders of a majority in aggregate principal amount
of the Registrable Notes included in any Registration Statement or in respect of
Registrable Notes or Exchange Notes to be sold by any Participating
Broker-Dealer during the Applicable Period, as the case may be, (iii) messenger,
telephone and delivery expenses, (iv) fees and disbursements of counsel for the
Issuers and, in the case of a Shelf Registration, reasonable fees and
disbursements of one special counsel for all of the sellers of Registrable Notes
(exclusive of any counsel retained pursuant to Section 7 hereof), (v) fees and
disbursements of all independent certified public accountants referred to in
Section 5(n)(iii) hereof (including, without limitation, the expenses of any
"cold comfort" letters required by or incident to such performance), (vi)
Securities Act liability insurance, if the Issuers desire such insurance, (vii)
fees and expenses of all other Persons retained by the Issuers, (viii) internal
expenses of the Issuers (including, without limitation, all salaries and
expenses of officers and employees of the Issuers performing legal or accounting
duties), (ix) the expense of any annual audit, (x) any fees and expenses
incurred in connection with the listing of the securities to be registered on
any securities exchange, and the obtaining of a rating of the securities, in
each case, if applicable, and (xi) the expenses relating to printing, word
processing and distributing all Registration Statements, underwriting
agreements, indentures and any other documents necessary in order to comply with
this Agreement.
-23-
7. Indemnification and Contribution. (a) The Company agrees, to
indemnify and hold harmless each Holder of Registrable Notes and each
Participating Broker-Dealer selling Exchange Notes during the Applicable Period,
and each Person, if any, who controls such Person or its affiliates within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act (each, a
"Participant") against any losses, claims, damages or liabilities to which any
Participant incurs under the Act, the Exchange Act or otherwise, insofar as any
such losses, claims, damages or liabilities (or actions in respect thereof) are
in connection with any pending or threatened third party action, claim or
proceeding which results from (or is alleged to result from):
(i) any untrue statement or alleged untrue statement of any material
fact contained in any Registration Statement (or any amendment thereto) or
Prospectus (as amended or supplemented if any of the Issuers shall have
furnished any amendments or supplements thereto) or any preliminary
prospectus; or
(ii) the omission or alleged omission to state, in any Registration
Statement (or any amendment thereto) or Prospectus (as amended or
supplemented if any of the Issuers shall have furnished any amendments or
supplements thereto) or any preliminary prospectus, a material fact
required to be stated therein or necessary to make the statements therein
not misleading;
and will reimburse, as incurred, the Participant for any legal or other
reasonable expenses incurred by the Participant in connection with
investigating, defending against or appearing as a third-party witness in
connection with any such loss, claim, damage, liability or action; provided,
however, the Issuers will not be liable in any such case to the extent that any
such loss, claim, damage, or liability arises out of or is based upon any untrue
statement or alleged untrue statement or omission or alleged omission made in
any Registration Statement (or any amendment thereto) or Prospectus (as amended
or supplemented if any of the Issuers shall have furnished any amendments or
supplements thereto) or any preliminary prospectus in reliance upon and in
conformity with information relating to any Participant furnished in writing to
the Issuers by such Participant specifically for use therein; and provided
further, in connection with the sale of Registrable Notes pursuant to a Shelf
Registration, the Company will not be liable to any Holder with respect to any
such untrue statement or alleged untrue statement or omission or alleged
omission made in any preliminary prospectus of a Registration Statement that is
corrected in a Prospectus (as amended or supplemented if any Issuer shall have
furnished any amendments or supplements thereto) relating to such securities if
the Person asserting any such claim, loss, damage or liability purchased such
securities and was not sent or given a copy of the Prospectus (as amended or
supplemented if any Issuer shall have furnished any amendments or supplements
thereto) if delivery of such Prospectus by such Holder was required under the
Act, provided the Company delivered in sufficient quantity such Prospectus (as
amended or supplemented if any Issuer shall have furnished any amendments or
supplements thereto) to such Holder sufficiently in advance of the written
-24-
confirmation of the sale of the securities to such Person asserting such claim,
loss, damage or liability and any such claims, losses, damages, or liabilities
result from (or are alleged to result from) the fact that a copy of the
Prospectus (as amended or supplemented if any Issuer shall have furnished any
amendments or supplements thereto) was not delivered to such Person at or prior
to the written confirmation of the sale of the securities to such Person. The
indemnity provided for in this Section 7 will be in addition to any liability
that the Issuers may otherwise have to the indemnified parties. The Issuers
shall not be liable under this Section 7 for any settlement of any claim or
action effected without the prior written consent of the Company, which shall
not be unreasonably withheld.
(b) Each Participant, severally and not jointly, agrees to indemnify
and hold harmless the Issuers, their directors, their officers and each
person, if any, who controls the Issuers within the meaning of Section 15
of the Act or Section 20 of the Exchange Act against any losses, claims,
damages or liabilities to which the Issuers or any such director, officer
or controlling person incur under the Act, the Exchange Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) result from (or are alleged to result from) (i) any untrue
statement or alleged untrue statement of any material fact contained in any
Registration Statement or Prospectus, any amendment or supplement thereto,
or any preliminary prospectus, or (ii) the omission or the alleged omission
to state therein a material fact necessary to make the statements therein
not misleading, in each case to the extent, but only to the extent, that
such untrue statement or alleged untrue statement or omission or alleged
omission was made in reliance upon and in conformity with written
information concerning such Participant, furnished to the Issuers by the
Participant, specifically for use therein; and subject to the limitation
set forth immediately preceding this clause, will reimburse, as incurred,
any legal or other expenses incurred by the Issuers or any such director,
officer or controlling person in connection with investigating or defending
against or appearing as a third party witness in connection with any such
loss, claim, damage, liability or action in respect thereof. The indemnity
provided for in this Section 7 will be in addition to any liability that
the Participants may otherwise have to the indemnified parties. The
Participants shall not be liable under this Section 7 for any settlement of
any claim or action effected without their consent, which shall not be
unreasonably withheld. The Issuers shall not, without the prior written
consent of such Participant, effect any settlement or compromise of any
pending or threatened proceeding in respect of which any Participant is or
could have been a party, or indemnity could have been sought hereunder by
any Participant, unless such settlement (A) includes an unconditional
written release of the Participants, in form and substance reasonably
satisfactory to the Participants, from all liability on claims that are the
subject matter of such proceeding and (B) does not include any statement as
to an admission of fault, culpability or failure to act by or on behalf of
any Participant.
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(c) Promptly after receipt by an indemnified party under this Section
7 of notice of the commencement of any action for which such indemnified
party is entitled to indemnification under this Section 7, such indemnified
party will, if a claim in respect thereof is to be made against the
indemnifying party under this Section 7, notify the indemnifying party of
the commencement thereof in writing; but the omission to so notify the
indemnifying party (i) will not relieve it from any liability under
paragraph (a) or (b) above unless and to the extent such failure results in
the forfeiture by the indemnifying party of substantial rights and defenses
and (ii) will not, in any event, relieve the indemnifying party from any
obligations to any indemnified party other than the indemnification
obligation provided in paragraphs (a) and (b) above. In case any such
action is brought against any indemnified party, and it notifies the
indemnifying party of the commencement thereof, the indemnifying party will
be entitled to participate therein and, to the extent that it may wish,
jointly with any other indemnifying party similarly notified, to assume the
defense thereof, with counsel reasonably satisfactory to such indemnified
party; provided, however, that if (i) the use of counsel chosen by the
indemnifying party to represent the indemnified party would present such
counsel with a conflict of interest, (ii) the defendants in any such action
include both the indemnified party and the indemnifying party and the
indemnified party shall have been advised by counsel that there may be one
or more legal defenses available to it and/or other indemnified parties
that are different from or additional to those available to the
indemnifying party, or (iii) the indemnifying party shall not have employed
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after receipt by the
indemnifying party of notice of the institution of such action, then, in
each such case, the indemnifying party shall not have the right to direct
the defense of such action on behalf of such indemnified party or parties
and such indemnified party or parties shall have the right to select
separate counsel to defend such action on behalf of such indemnified party
or parties. After notice from the indemnifying party to such indemnified
party of its election so to assume the defense thereof and approval by such
indemnified party of counsel appointed to defend such action, the
indemnifying party will not be liable to such indemnified party under this
Section 7 for any legal or other expenses, other than reasonable costs of
investigation, subsequently incurred by such indemnified party in
connection with the defense thereof, unless (i) the indemnified party shall
have employed separate counsel in accordance with the proviso to the
immediately preceding sentence (it being understood, however, that in
connection with such action the indemnifying party shall not be liable for
the expenses of more than one separate counsel (in addition to local
counsel) in any one action or separate but substantially similar actions in
the same jurisdiction arising out of the same general allegations or
circumstances, designated by Participants who sold a majority in interest
of the Registrable Notes and Exchange Notes sold by all such Participants
in the case of paragraph (a) of this Section 7 or the Issuers in the case
of paragraph (b) of this Section 7, representing the indemnified parties
under such
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paragraph (a) or paragraph (b), as the case may be, who are parties to such
action or actions) or (ii) the indemnifying party has authorized in writing
the employment of counsel for the indemnified party at the expense of the
indemnifying party. All fees and expenses reimbursed pursuant to this
paragraph (c) shall be reimbursed as they are incurred. After such notice
from the indemnifying party to such indemnified party, the indemnifying
party will not be liable for the costs and expenses of any settlement of
such action effected by such indemnified party without the prior written
consent of the indemnifying party (which consent shall not be unreasonably
withheld), unless such indemnified party waived in writing its rights under
this Section 7, in which case the indemnified party may effect such a
settlement without such consent.
(d) In circumstances in which the indemnity agreement provided for in
the preceding paragraphs of this Section 7 is unavailable to, or
insufficient to hold harmless, an indemnified party in respect of any
losses, claims, damages or liabilities (or actions in respect thereof),
each indemnifying party, in order to provide for just and equitable
contribution, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or
liabilities (or actions in respect thereof) in such proportion as is
appropriate to reflect (i) the relative benefits received by the
indemnifying party or parties on the one hand and the indemnified party 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
party or parties on the one hand and the indemnified party 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). The relative benefits received by the Issuers
on the one hand and such Participant on the other shall be deemed to be in
the same proportion as the total proceeds from the offering (before
deducting expenses) of the Notes received by the Issuers bear to the total
net profit received by such Participant in connection with the sale of the
Notes. 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 Issuers on the one hand, or the
Participants on the other, the parties' relative intent, knowledge, access
to information and opportunity to correct or prevent such statement or
omission or alleged statement or omission, and any other equitable
considerations appropriate in the circumstances. The parties agree that it
would not be equitable if the amount of such contribution were determined
by pro rata or per capita allocation or by any other method of allocation
that does not take into account the equitable considerations referred to in
the first sentence of this paragraph (d). Notwithstanding any other
provision of this paragraph (d), no Participant shall be obligated to make
contributions hereunder that in the aggregate exceed the total net profit
received by such Participant in connection with the sale of the Notes, less
the aggregate amount of any damages that such
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Participant has otherwise been required to pay by reason of the untrue or
alleged untrue statements or the omissions or alleged omissions to state a
material fact, and no person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation.
For purposes of this paragraph (d), each person, if any, who controls a
Participant within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act shall have the same rights to contribution as the
Participants, and each director of any Issuer, each officer of any Issuer
and each person, if any, who controls any Issuer within the meaning of
Section 15 of the Act or Section 20 of the Exchange Act, shall have the
same rights to contribution as the Issuers.
8. Rules 144 and 144A
Each of the Issuers covenants and agrees that, so long as Registrable
Notes remain outstanding, it will file the reports required to be filed by it
under the Securities Act and the Exchange Act and the rules and regulations
adopted by the SEC thereunder in a timely manner in accordance with the
requirements of the Securities Act and the Exchange Act and, if at any time such
Issuer is not required to file such reports, such Issuer will, upon the request
of any Holder or beneficial owner of Registrable Notes, make available annual
reports and such information, documents and other reports of the type specified
in Sections 13 and 15(d) of the Exchange Act, such information necessary to
permit sales pursuant to Rule 144A. Each of the Issuers further covenants and
agrees, for so long as any Registrable Notes remain outstanding that it will
take such further action as any Holder of Registrable Notes may reasonably
request, all to the extent required from time to time to enable such holder to
sell Registrable Notes without registration under the Securities Act within the
limitation of the exemptions provided by Rule 144(k) under the Securities Act
and Rule 144A.
9. Underwritten Registrations
If any of the Registrable Notes covered by any Shelf Registration 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
Notes included in such offering and shall be reasonably acceptable to the
Issuers.
No Holder of Registrable Notes may participate in any underwritten
registration hereunder unless such Holder (a) agrees to sell such Holder's
Registrable Notes 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.
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10. Miscellaneous
(a) No Inconsistent Agreements. The Issuers have not, as of the date
hereof, and the Issuers shall not, after the date of this Agreement, enter
into any agreement with respect to any of their securities that is
inconsistent with the rights granted to the Holders of Registrable Notes in
this Agreement or otherwise conflicts with the provisions hereof. The
rights granted to the Holders hereunder do not in any way conflict with and
are not inconsistent with the rights granted to the holders of the Issuers'
other issued and outstanding securities under any such agreements. The
Issuers will not enter into any agreement with respect to any of their
securities which will grant to any Person piggy-back registration rights
with respect to any Registration Statement.
(b) Adjustments Affecting Registrable Notes. The Issuers shall not,
directly or indirectly, take any action with respect to the Registrable
Notes as a class that would adversely affect the ability of the Holders of
Registrable Notes to include such Registrable Notes in a registration
undertaken pursuant to this Agreement.
(c) Amendments and Waivers. The provisions of this Agreement may not
be amended, modified or supplemented, and waivers or consents to departures
from the provisions hereof may not be given, otherwise than with the prior
written consent of (I) the Company, and (II)(A) the Holders of not less
than a majority in aggregate principal amount of the then outstanding
Registrable Notes 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 Notes
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 Notes or Exchange Notes, 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 Notes 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
Notes may be given by Holders of at least a majority in aggregate principal
amount of the Registrable Notes being sold pursuant to such Registration
Statement.
(d) Notices. All notices and other communications (including, without
limitation, any notices or other communications to the Trustee) provided
for or
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permitted hereunder shall be made in writing by hand-delivery, registered
first-class mail, next-day air courier or facsimile:
(i) if to a Holder of the Registrable Notes or any Participating
Broker-Dealer, at the most current address of such Holder or Participating
Broker-Dealer, as the case may be, set forth on the records of the
registrar under the Indenture, with a copy in like manner to the Initial
Purchasers as follows:
Deutsche Bank Securities Inc.
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No.: (000) 000-0000
Attention: Corporate Finance Department
(ii) if to the Initial Purchasers, at the address specified in Section
10(d)(i);
(iii) if to the Issuers, at the address as follows:
OMNOVA Solutions Inc.
000 Xxxxx Xxxx
Xxxxxxxx, Xxxx 00000
Facsimile No.: (000) 000-0000
Attention: General Counsel
with a copy to:
Xxxxx Day
North Point, 000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxx 00000
Facsimile No.: (000) 000-0000
Attention: Xxxxxxxxxxx X. Xxxxx, Esq.
All such notices and communications shall be deemed to have been duly
given: when delivered by hand, if personally delivered; five Business Days after
being deposited in the mail, postage prepaid, if mailed; one Business Day after
being timely delivered to a next-day air courier; and when receipt is
acknowledged by the addressee, if sent by facsimile.
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address and in the manner specified in such 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
hereto, the
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Holders and the Participating Broker-Dealers; provided, however, that
nothing herein shall be deemed to permit any assignment, transfer or other
disposition of Registrable Notes in violation of the terms of the Purchase
Agreement or the Indenture.
(f) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
(g) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(h) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED ENTIRELY WITHIN THE STATE OF NEW YORK, WITHOUT
REGARD TO PRINCIPLES OF CONFLICTS OF LAW THAT WOULD REQUIRE THE APPLICATION
OF ANY OTHER LAW.
(i) Severability. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the
parties hereto shall use their best efforts to find and employ an
alternative means to achieve the same or substantially the same result as
that contemplated by such term, provision, covenant or restriction. It is
hereby stipulated and declared to be the intention of the parties that they
would have executed the remaining terms, provisions, covenants and
restrictions without including any of such that may be hereafter declared
invalid, illegal, void or unenforceable.
(j) Securities Held by the Issuers or Their Affiliates. Whenever the
consent or approval of Holders of a specified percentage of Registrable
Notes is required hereunder, Registrable Notes held by the Issuers or their
affiliates (as such term is defined in Rule 405 under the Securities Act)
shall not be counted in determining whether such consent or approval was
given by the Holders of such required percentage.
(k) Third-Party Beneficiaries. Holders of Registrable Notes and
Participating Broker-Dealers are intended third-party beneficiaries of this
Agreement, and this Agreement may be enforced by such Persons.
(l) Entire Agreement. This Agreement, together with the Purchase
Agreement and the Indenture, is intended by the parties as a final and
exclusive
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statement of the agreement and understanding of the parties hereto in
respect of the subject matter contained herein and therein and any and all
prior oral or written agreements, representations, or warranties,
contracts, understandings, correspondence, conversations and memoranda
between the Holders on the one hand and the Issuers on the other, or
between or among any agents, representatives, parents, subsidiaries,
affiliates, predecessors in interest or successors in interest with respect
to the subject matter hereof and thereof are merged herein and replaced
hereby.
S-1
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
OMNOVA SOLUTIONS INC.
By: /s/ Xxxxx X. XxXxx
--------------------------------------
Name: Xxxxx X. XxXxx
Title: Senior Vice President
S-2
The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.
DEUTSCHE BANK SECURITIES INC.
BANC ONE CAPITAL MARKETS, INC.
McDONALD INVESTMENTS INC.
By: /s/ Xxxxx Xxxxxxxx
-------------------------------------
Name: Xxxxx Xxxxxxxx
Title: Managing Director
By: /s/ Xxxx Xxxxxxxx
-------------------------------------
Name: Xxxx Xxxxxxxx
Title: Director
