EXECUTION COPY
EXHIBIT 10.2
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT, dated as of October 1, 2001
(this "AGREEMENT"), by and among METROMEDIA FIBER NETWORK, INC., a Delaware
corporation (the "COMPANY"), Xxxx X. Xxxxx, Xxxxx Manhattan Bank and Xxxxxx
Xxxxxxxxx, trustees under a Trust Agreement, dated May 30, 1984 and as amended
and restated, between Xxxx X. Xxxxx, as grantor, and Xxxx X. Xxxxx and
Manufacturers Hanover Trust Company, as trustees, a grantor trust (the "XXXXX
TRUST"), XXXXX XXXXXXXXXXX ("ROCKEFELLER") and XXXXXXX X. XXXXXXXX ("XXXXXXXX"
and, together with the Xxxxx Trust and Rockefeller, the "PURCHASERS").
WHEREAS, the Company and the Purchasers have entered into the
Note Purchase Agreement, dated as of October 1, 2001 (the "NOTE PURCHASE
AGREEMENT"), pursuant to which the Company has agreed to issue and sell to the
Purchasers, and the Purchasers have agreed to purchase from the Company, certain
8.5% senior convertible promissory notes of the Company (the "CONVERTIBLE
NOTES"), which are convertible into shares of class A common stock, par value
$0.01 per share, of the Company ("CLASS A COMMON STOCK"); and
WHEREAS, in order to induce the Purchasers to enter into the
Note Purchase Agreement and to purchase the Convertible Notes, the Company has
agreed to provide registration rights with respect to the shares of Class A
Common Stock into which the Convertible Notes are convertible.
NOW, THEREFORE, in consideration of the premises and the
covenants hereinafter contained, it is agreed as follows:
1. DEFINITIONS. Unless otherwise defined herein, terms defined in the Purchase
Agreement are used herein as therein defined, and the following shall have
(unless otherwise provided elsewhere in this Agreement) the following respective
meanings (such meanings being equally applicable to both the singular and plural
form of the terms defined):
"AFFILIATE" shall mean, with respect to any Person, any other
Person directly or indirectly controlling or controlled by, or under direct or
indirect common control with, such Person.
"AGREEMENT" shall mean this Registration Rights Agreement,
including all amendments, modifications and supplements and any exhibits or
schedules to any of the foregoing.
"BLACKOUT PERIOD" shall have the meaning assigned to such term
in Section 5 hereof.
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"BUSINESS DAY" shall mean any day that is not a Saturday, a
Sunday or a day on which commercial banks are required or permitted by law to be
closed in the City of New York in the State of New York.
"CLASS A COMMON STOCK" shall have the meaning assigned to such
term in the recitals hereof.
"DEMAND REGISTRATION" shall have the meaning assigned to such
term in Section 2(a) hereof.
"DEMAND REGISTRATION STATEMENT" shall have the meaning
assigned to such term in Section 2(a) hereof.
"HOLDER" shall mean each Purchaser and any transferee of a
Purchaser to whom Registrable Securities are permitted to be transferred in
accordance with this Agreement and who continues to be entitled to the rights of
a Holder hereunder.
"INDEMNIFIED PARTY" shall have the meaning assigned to such
term in Section 8(d) hereof.
"INDEMNIFYING PARTY" shall have the meaning assigned to such
term in Section 8(d) hereof.
"MAXIMUM NUMBER OF SECURITIES" shall have the meaning assigned
to such term in Section 2(b) hereof.
"NASD" shall mean the National Association of Securities
Dealers, Inc., or any successor entity thereof.
"NOTE PURCHASE AGREEMENT" shall have the meaning assigned to
such term in the recitals hereof.
"PARTICIPATING DEMAND HOLDERS" shall have the meaning assigned
to such term in Section 2(a) hereof.
"PARTICIPATING PIGGY-BACK HOLDERS" shall have the meaning
assigned to such term in Section 3(b) hereof.
"PERSON" shall mean any individual, corporation, partnership,
joint venture, firm, trust, unincorporated organization, government or any
agency or political subdivision thereof or other entity.
"PIGGY-BACK REGISTRATION" shall have the meaning assigned to
such term in Section 3(a) hereof.
"PIGGY-BACK REGISTRATION STATEMENT" shall have the meaning
assigned to such term in Section 3(a) hereof.
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"REGISTRABLE SECURITIES" shall mean (a) the shares of Class A
Common Stock held by a Holder upon conversion of any Convertible Notes and (b)
any Securities issuable or issued or distributed in respect of any of the Class
A Common Stock identified in clause (a) by way of stock dividend or stock split
or in connection with a combination of shares, recapitalization, reorganization,
merger, consolidation or otherwise. For purposes of this Agreement, (i)
Registrable Securities shall cease to be Registrable Securities when a
Registration Statement covering such Registrable Securities has been declared
effective under the Securities Act by the SEC and such Registrable Securities
have been disposed of pursuant to such effective Registration Statement and (ii)
the Registrable Securities of a Holder shall not be deemed to be Registrable
Securities at any time when the entire amount of such Registrable Securities
proposed to be sold by such Holder in a single sale are or, in the opinion of
counsel satisfactory to the Company and such Holder, each in their reasonable
judgment, may be, so distributed to the public pursuant to Rule 144 (or any
successor provision then in effect) under the Securities Act or any such
Registrable Securities have been sold in a sale made pursuant to Rule 144 of the
Securities Act.
"REGISTRATION STATEMENT" shall mean the Demand Registration
Statement, the Piggy-Back Registration Statement and/or the Shelf Registration
Statement, as the case may be.
"SECURITIES" shall have the meaning assigned to such term in
Section 2(a)(1) of the Securities Act.
"SECURITIES ACT" shall mean the Securities Act of 1933, as
amended, and all rules and regulations promulgated thereunder.
"SEC" shall mean the Securities and Exchange Commission, or
any successor thereto.
"SHELF REGISTRATION" shall have the meaning assigned to such
term in Section 4 hereof.
"SHELF REGISTRATION STATEMENT" shall have the meaning assigned
to such term in Section 4 hereof.
2. DEMAND REGISTRATION.
(a) At any time from and after 180 days following the date
hereof and subject to Section 2(c) hereof, after receipt of a written request
from a Holder requesting that the Company effect a registration (a "DEMAND
REGISTRATION") under the Securities Act covering all or part of the Registrable
Securities which specifies the intended method or methods of disposition
thereof, the Company shall promptly notify all Holders in writing of the receipt
of such request and each such Holder, in lieu of exercising its rights under
Section 3 hereof may elect (by written notice sent to the Company within ten
(10) Business Days from the date of such Holder's receipt of the aforementioned
notice from the Company) to have all or part of such Holder's
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Registrable Securities included in such registration thereof pursuant to this
Section 2, and such Holder shall specify in such notice the number of
Registrable Securities that such Holder elects to include in such registration.
Thereupon the Company shall, as expeditiously as is possible, but in any event
no later than thirty (30) days (excluding any days which occur during a
permitted Blackout Period under Section 5 below) after receipt of a written
request for a Demand Registration, file with the SEC and use its reasonable best
efforts to cause to be declared effective, a registration statement (a "DEMAND
REGISTRATION STATEMENT") relating to all shares of Registrable Securities which
the Company has been so requested to register by such Holders ("PARTICIPATING
DEMAND HOLDERS") for sale, to the extent required to permit the disposition (in
accordance with the intended method or methods thereof, as aforesaid) of the
Registrable Securities so registered, PROVIDED, HOWEVER, that the aggregate
value of the Registrable Securities requested to be registered (i) be at least
$25,000,000, based on the closing trading price of the Class A Common Stock on
the date the demand to file such Demand Registration Statement is made or (ii)
include all Registrable Securities which remain outstanding at such time.
(b) If the majority of the Holders in a Demand Registration
relating to a public offering so request that the offering be underwritten with
a managing underwriter selected in the manner set forth in Section 12 below and
such managing underwriter of such Demand Registration advises the Company in
writing that, in its opinion, the number of Securities to be included in such
offering is greater than the total number of Securities which can be sold
therein without having a material adverse effect on the distribution of such
Securities or otherwise having a material adverse effect on the marketability
thereof (the "MAXIMUM NUMBER OF SECURITIES"), then the Company shall include in
such Demand Registration the Registrable Securities that the Participating
Demand Holders have requested to be registered thereunder only to the extent the
number of such Registrable Securities does not exceed the Maximum Number of
Securities. If such amount exceeds the Maximum Number of Securities, the number
of Registrable Securities included in such Demand Registration shall be
allocated among all the Participating Demand Holders on a pro rata basis. If the
amount of such Registrable Securities does not exceed the Maximum Number of
Securities, the Company may include in such Registration any other Securities of
the Company and other Securities held by other security holders of the Company,
on a pro rata basis if necessary, in an amount which together with the
Registrable Securities included in such Demand Registration shall not exceed the
Maximum Number of Securities.
(c) Holders shall be entitled to three (3) registrations of
Registrable Securities pursuant to this Section 2. Each Shelf Registration
pursuant to Section 4 hereof shall be deemed one registration pursuant hereto.
(d) Notwithstanding anything to the contrary contained
herein, the Company shall not be required to prepare and file (i) more than two
(2) Demand Registration Statements in any twelve-month period, or (ii) any
Demand Registration Statement within 90 days following the date of effectiveness
of any other Registration Statement (other than a Shelf Registration Statement).
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3. PIGGY-BACK REGISTRATION.
(a) If the Company, at any time after 180 days from the date
hereof, proposes to file on its behalf and/or on behalf of any holder of its
Securities (other than a holder of Registrable Securities) a registration
statement under the Securities Act on any form (other than a registration
statement on Form S-4 or S-8 or any successor form for Securities to be offered
in a transaction of the type referred to in Rule 145 under the Securities Act or
to employees of the Company pursuant to any employee benefit plan, respectively)
for the registration of Securities (a "PIGGY-BACK REGISTRATION"), it will give
written notice to all Holders at least twenty (20) days before the initial
filing with the SEC of such piggy-back registration statement (a "PIGGY-BACK
REGISTRATION STATEMENT"), which notice shall set forth the intended method of
disposition of the Securities proposed to be registered by the Company. The
notice shall offer to include in such filing the aggregate number of shares of
Registrable Securities as such Holders may request.
(b) Each Holder desiring to have Registrable Securities
registered under this Section 3 ("PARTICIPATING PIGGY-BACK HOLDERS") shall
advise the Company in writing within ten (10) days after the date of receipt of
such offer from the Company, setting forth the amount of such Registrable
Securities for which registration is requested. The Company shall thereupon
include in such filing the number or amount of Registrable Securities for which
registration is so requested, subject to paragraph (c) below, and shall use its
reasonable best efforts to effect registration of such Registrable Securities
under the Securities Act.
(c) If the Piggy-Back Registration relates to an underwritten
public offering and the managing underwriter of such proposed public offering
advises in writing that, in its opinion, the amount of Registrable Securities
requested to be included in the Piggy-Back Registration in addition to the
Securities being registered by the Company would be greater than the Maximum
Number of Securities, then:
(i) in the event Company initiated the Piggy-Back
Registration, the Company shall include in such Piggy-Back Registration
FIRST, the Securities the Company proposes to register and SECOND, the
Securities of all other selling security holders, including the
Participating Piggy-Back Holders, to be included in such Piggy-Back
Registration in an amount which together with the Securities the
Company proposes to register, shall not exceed the Maximum Number of
Securities, such amount to be allocated among such selling security
holders on a pro rata basis;
(ii) in the event any holder of Securities of the Company
initiated the Piggy-Back Registration, the Company shall include in
such Piggy-Back Registration FIRST, the Securities such initiating
security holder proposes to register and SECOND, the Securities of any
other selling security holders, in an amount which together with the
Securities the initiating security holder proposes to register, shall
not exceed the Maximum Number of Securities, such amount to be
allocated among such other selling security holders on a pro rata
basis;
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(d) The Company will not hereafter enter into any agreement
which is inconsistent with the rights of priority provided in paragraph (c)
above.
4. SHELF REGISTRATION. Upon the written request of the holders
of a majority of the Registrable Securities held by all of the Holders, as
promptly as practicable, but in any event no later than thirty (30) days
(excluding any days which occur during a permitted Blackout Period under Section
5 below) after receipt of such request, the Company shall file with the SEC and
thereafter use its reasonable best efforts to cause to be declared effective as
promptly as practicable, but no later than ninety (90) days (excluding any days
which occur during a permitted Blackout Period under Section 5 below) after
receipt of such request, a registration statement (the "SHELF REGISTRATION
STATEMENT") on an appropriate form under the Securities Act relating to any or
all of the Registrable Securities in accordance with the methods and
distribution set forth in the Shelf Registration Statement and Rule 415 under
the Securities Act (hereafter, the "SHELF REGISTRATION"). The Company shall use
its reasonable best efforts to keep the Shelf Registration Statement
continuously effective in order to permit the prospectus included therein to be
lawfully delivered to the Holders for a period of time ending the earlier of (a)
such time as all the Registrable Securities have been disposed pursuant thereto,
and (b) the date on which the Company receives an opinion of outside counsel,
satisfactory to the Company and the Holders, to the effect that in their
reasonable judgment, all the Registrable Securities may be distributed to the
public pursuant to Rule 144 (or any successor provision then in effect) under
the Securities Act.
5. BLACKOUT PERIODS. The Company shall have the right to delay
the filing or effectiveness of a Registration Statement required pursuant to
Sections 2, 3 or 4 hereof during no more than two (2) periods aggregating to not
more than 90 days in any twelve-month period (a "BLACKOUT PERIOD") in the event
that (i) the Company would, in accordance with the advice of its counsel, be
required to disclose in the prospectus information not otherwise then required
by law to be publicly disclosed and (ii) in the judgment of the Company's Board
of Directors, there is a reasonable likelihood that such disclosure, or any
other action to be taken in connection with the prospectus, would materially and
adversely affect or interfere with any financing, acquisition, merger,
disposition of assets (not in the ordinary course of business), corporate
reorganization or other similar transaction involving the Company; PROVIDED,
HOWEVER, that the Company shall delay during such Blackout Period the filing or
effectiveness of any Registration Statement required pursuant to the
registration rights of the holders of any Securities of the Company. The Company
shall promptly give the Holders written notice of such determination containing
a general statement of the reasons for such postponement and an approximation of
the anticipated delay.
6. REGISTRATION PROCEDURES. If the Company is required by the
provisions of Section 2, 3 or 4 to use its reasonable best efforts to effect the
registration of any of its Securities under the Securities Act, the Company
will, as expeditiously as possible:
(a) prepare and file with the SEC a Registration Statement
with respect to such Securities and use its reasonable best efforts to cause
such Registration
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Statement promptly to become and remain effective for a period of time required
for the disposition of such Securities by the holders thereof but not to exceed
180 days (except with respect to the Shelf Registration Statement). The Company
shall not be deemed to have used its reasonable best efforts to keep a
Registration Statement effective during the applicable period if it voluntarily
takes any action that would result in the Holders of such Registrable Securities
not being able to sell such Registrable Securities during that period, unless
such action is required under applicable law;
(b) prepare and file with the SEC such amendments and
supplements to such Registration Statement and the prospectus used in connection
therewith as may be necessary to keep such Registration Statement effective and
to comply with the provisions of the Securities Act with respect to the sale or
other disposition of all Securities covered by such Registration Statement until
the earlier of such time as all of such Securities have been disposed of in a
public offering or (except with respect to the Shelf Registration Statement) the
expiration of 180 days;
(c) furnish to such selling security holders such number of
copies of the applicable Registration Statement and each such amendment and
supplement thereto, and of a summary prospectus or other prospectus, including a
preliminary prospectus, in conformity with the requirements of the Securities
Act, and such other documents, as such selling security holders may reasonably
request;
(d) use its reasonable best efforts to register or qualify
the Securities covered by such Registration Statement under such other
Securities or blue sky laws of such jurisdictions within the United States and
Puerto Rico as each Holder of such Securities shall reasonably request
(PROVIDED, HOWEVER, that the Company shall not be obligated to qualify as a
foreign corporation to do business under the laws of any jurisdiction in which
it is not then qualified or to file any general consent to service or process),
and do such other reasonable acts and things as may be required of it to enable
such Holder to consummate the disposition in such jurisdiction of the Securities
covered by such Registration Statement;
(e) furnish, at the request of any Holder requesting
registration of Registrable Securities, on the date that such shares of
Registrable Securities are delivered to the underwriters for sale pursuant to
such registration or, if such Registrable Securities are not being sold through
underwriters, on the date that the Registration Statement with respect to such
shares of Registrable Securities becomes effective, (1) an opinion, dated such
date, of the independent counsel representing the Company for the purposes of
such registration, addressed to the underwriters, if any, in customary form and
covering matters of the type customarily covered in such legal opinions; and (2)
a comfort letter, dated such date, from the independent certified public
accountants of the Company, addressed to the underwriters, in a customary form
and covering matters of the type customarily covered by such comfort letters and
as the underwriters shall reasonably request. Such opinion of counsel shall
additionally cover such other legal matters with respect to the registration in
respect of which such opinion is being given as such underwriters may reasonably
request;
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(f) enter into customary agreements (including an
underwriting agreement in customary form) and take such other actions as are
reasonably required in order to expedite or facilitate the disposition of such
Registrable Securities;
(g) otherwise use its reasonable best efforts to comply with
all applicable rules and regulations of the SEC, and make earnings statements
satisfying the provisions of Section 11(a) of the Securities Act generally
available to the Holders no later than 45 days after the end of any twelve-month
period (or 90 days, if such period is a fiscal year) (i) commencing at the end
of any fiscal quarter in which Registrable Securities are sold to underwriters
in an underwritten public offering, or (ii) if not sold to underwriters in such
an offering, beginning with the first month of the Company's first fiscal
quarter commencing after the effective date of the Registration Statement, which
statements shall cover said twelve-month periods;
(h) use its reasonable best efforts to cause all such
Registrable Securities to be listed on each securities exchange or quotation
system on which similar securities issued by the Company are listed or traded;
(i) give written notice to the Holders:
(i) when such Registration Statement or any amendment
thereto has been filed with the SEC and when such Registration
Statement or any post-effective amendment thereto has become effective;
(ii) of any request by the SEC for amendments or
supplements to such Registration Statement or the prospectus included
therein or for additional information;
(iii) of the issuance by the SEC of any stop order
suspending the effectiveness of such Registration Statement or the
initiation of any proceedings for that purpose;
(iv) of the receipt by the Company or its legal counsel of
any notification with respect to the suspension of the qualification of
the Class A Common Stock for sale in any jurisdiction or the initiation
or threatening of any proceeding for such purpose; and
(v) of the happening of any event that requires the
Company to make changes in such Registration Statement or the
prospectus in order to make the statements therein not misleading
(which notice shall be accompanied by an instruction to suspend the use
of the prospectus until the requisite changes have been made);
(j) use its reasonable best efforts to prevent the issuance
or obtain the withdrawal of any order suspending the effectiveness of such
Registration Statement at the earliest possible time;
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(k) furnish to each Holder, without charge, at least one
copy of such Registration Statement and any post-effective amendment thereto,
including financial statements and schedules, and, if the Holder so requests in
writing, all exhibits (including those, if any, incorporated by reference);
(l) upon the occurrence of any event contemplated by Section
6(i)(v) above, promptly prepare a post-effective amendment to such Registration
Statement or a supplement to the related prospectus or file any other required
document so that, as thereafter delivered to the Holders, the prospectus will
not contain an untrue statement of a material fact or omit to state any material
fact necessary to make the statements therein, in light of the circumstances
under which they were made, not misleading. If the Company notifies the Holders
in accordance with Section 6(i)(v) above to suspend the use of the prospectus
until the requisite changes to the prospectus have been made, then the Holders
shall suspend use of such prospectus, and the period of effectiveness of such
Registration Statement provided for above shall be extended by the number of
days from and including the date of the giving of such notice to the date
Holders shall have received such amended or supplemented prospectus pursuant to
this Section 6(l);
(m) make reasonably available for inspection by a single
representative of the Holders, any underwriter participating in any disposition
pursuant to such Registration Statement and any attorney, accountant or other
agent retained by such representative or any such underwriter all relevant
financial and other records, pertinent corporate documents and properties of the
Company and (ii) cause the Company's officers, directors and employees to supply
all relevant information reasonably requested by such representative or any such
underwriter, attorney, accountant or agent in connection with the registration;
and
(n) in connection with any underwritten offering, make
appropriate officers of the Company available to the selling security holders
for meetings with prospective purchasers of the Registrable Securities and
prepare and present to potential investors customary "road show" material in a
manner consistent with other new issuances of Securities similar to the
Registrable Securities, in connection with any proposed sale of the Registrable
Securities in an aggregate offering of at least $25,000,000.
It shall be a condition precedent to the obligation of the
Company to take any action pursuant to this Agreement in respect of the
Securities which are to be registered at the request of any Holder that such
Holder shall furnish to the Company such information regarding the Securities
held by such Holder and the intended method of disposition thereof as the
Company shall reasonably request and as shall be required in connection with the
action taken by the Company.
7. EXPENSES. All expenses incurred in complying with the
provisions of this Agreement, including, without limitation, all registration
and filing fees (including all expenses incident to filing with the NASD),
printing expenses, fees and disbursements of counsel for the
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Company, the reasonable fees and expenses of a single counsel for the Holders
(selected by those holding a majority of the shares being registered), expenses
of any special audits incident to or required by any such registration and
expenses of complying with the Securities or blue sky laws of any jurisdiction
pursuant to Section 6(d), shall be paid by the Company, except that:
(a) all such expenses in connection with any amendment or
supplement to the Registration Statement or prospectus filed more than 180 days
after the effective date of such Registration Statement because any Holder has
not effected the disposition of the Securities requested to be registered shall
be paid by such Holder; and
(b) the Company shall not be liable for any fees, discounts
or commissions to any underwriter or any fees or disbursements of counsel for
any underwriter in respect of the Securities sold by such Holder.
8. INDEMNIFICATION AND CONTRIBUTION.
(a) In the event of any registration of any Registrable
Securities under the Securities Act pursuant to this Agreement, the Company
shall indemnify and hold harmless the Holder of such Registrable Securities,
such Holder's directors and officers, and each other Person (including each
underwriter) to the extent permitted by law who participated in the offering of
such Registrable Securities and each other Person, if any, who controls such
Holder or such participating person within the meaning of the Securities Act,
against any losses, claims, damages or liabilities, joint or several, to which
such Holder or any such director or officer or participating Person or
controlling Person may become subject under the Securities Act or any other
statute or at common law, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon (i) any alleged
untrue statement of any material fact contained, on the effective date thereof,
in any Registration Statement under which such Securities were registered under
the Securities Act, any preliminary prospectus or final prospectus relating to
the Securities, or any amendment or supplement thereto, or (ii) any alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and shall reimburse
such Holder or such director, officer or participating Person or controlling
Person for any legal or any other expenses reasonably incurred by such Holder or
such director, officer or participating Person or controlling person in
connection with investigating or defending any such loss, claim, damage,
liability or action; PROVIDED that the foregoing indemnity with respect to any
preliminary prospectus shall not inure to the benefit of any indemnified party
from whom the person asserting such losses, claims, damages, liabilities,
expenses and judgments purchased securities if such untrue statement or omission
or alleged untrue statement or omission made in such preliminary prospectus is
eliminated or remedied in the prospectus and a copy of the prospectus shall not
have been furnished to such Person in a timely manner, unless such prospectus
was not furnished because the Company failed to provide the indemnified party
with sufficient copies of such corrected prospectus within the time period
required; PROVIDED, FURTHER that the Company shall not be liable in any case to
the extent such losses, claims, damages or liabilities arise out of or are based
upon any untrue statement or actual or alleged omission made in such
Registration Statement, preliminary prospectus, prospectus or
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amendment or supplement, in reliance upon and in conformity with written
information furnished to the Company by such Holder or such Holder's directors
or officers specifically for use therein, or (in the case of any underwritten
offering) so furnished for such purpose by any underwriter.
(b) Each Holder, by acceptance hereof, agrees to indemnify
and hold harmless the Company, its directors and officers and each other person,
if any, who controls the Company within the meaning of the Securities Act
against any losses, claims, damages or liabilities, joint or several, to which
the Company or any such director or officer or any such person may become
subject under the Securities Act or any other statute or at common law, insofar
as such losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon information in writing provided to the Company by
such Holder specifically for use in the following documents and contained, on
the effective date thereof, in any Registration Statement under which Securities
were registered under the Securities Act at the request of such Holder, any
preliminary prospectus or final prospectus contained therein, or any amendment
or supplement thereto. Notwithstanding the provisions of this paragraph (b) or
paragraph (c) below, no Holder shall be required to indemnify any person
pursuant to this Section 8 or to contribute pursuant to paragraph (c) below in
an amount in excess of the amount of the aggregate net proceeds received by such
Holder in connection with any such registration under the Securities Act.
(c) If the indemnification provided for in this Section 8
from the indemnifying party is unavailable to an indemnified party hereunder in
respect of any losses, claims, damages, liabilities or expenses referred to
therein, then the 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, claims, damages, liabilities or expenses in such
proportion as is appropriate to reflect the relative fault of the indemnifying
party and indemnified parties in connection with the actions which resulted in
such losses, claims, damages, liabilities or expenses, as well as any other
relevant equitable considerations. The relative fault of such indemnifying party
and indemnified parties shall be determined by reference to, among other things,
whether any action in question, including any untrue or alleged untrue statement
of a material fact or omission or alleged omission to state a material fact, has
been made by, or relates to information supplied by, such indemnifying party or
indemnified parties, and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such action. The amount paid
or payable by a party as a result of the losses, claims, damages, liabilities
and expenses referred to above shall be deemed to include any legal or other
fees or expenses reasonably incurred by such party in connection with any
investigation or proceeding. If the allocation provided in this paragraph (c) is
not permitted by applicable law, the parties shall contribute based upon the
relevant benefits received by the Company from the initial offering of the
Securities on the one hand and the net proceeds received by the Holders from the
sale of Securities on the other.
The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 8(c) were determined by pro
rata allocation or by any other method of allocation which does not take account
of the equitable
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considerations referred to in the immediately preceding paragraph. No Person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any Person who was
not guilty of such fraudulent misrepresentation.
(d) Any Person entitled to indemnification hereunder (the
"INDEMNIFIED PARTY") agrees to give prompt written notice to the indemnifying
party (the "INDEMNIFYING PARTY") after the receipt by the Indemnified Party of
any written notice of the commencement of any action, suit, proceeding or
investigation or threat thereof made in writing for which the Indemnified Party
intends to claim indemnification or contribution pursuant to this Agreement;
PROVIDED, that the failure so to notify the Indemnified Party shall not relieve
the Indemnifying Party of any liability that it may have to the Indemnifying
Party hereunder unless such failure is materially prejudicial to the
Indemnifying Party. If notice of commencement of any such action is given to the
Indemnifying Party as above provided, the Indemnifying Party shall be entitled
to participate in and, to the extent it may wish, to assume the defense of such
action at its own expense, with counsel chosen by it and reasonably satisfactory
to such Indemnified Party. The Indemnified Party 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 paid by the Indemnified Party
unless (i) the Indemnifying Party agrees to pay the same, (ii) the Indemnifying
Party fails to assume the defense of such action, or (iii) the named parties to
any such action (including any impleaded parties) have been advised by such
counsel that either (A) representation of such Indemnified Party and the
Indemnifying Party by the same counsel would be inappropriate under applicable
standards of professional conduct or (B) there are one or more legal defenses
available to it which are substantially different from or additional to those
available to the Indemnifying Party. No Indemnifying Party shall be liable for
any settlement entered into without its written consent, which consent shall not
be unreasonably withheld.
(e) The agreements contained in this Section 8 shall survive
the transfer of the Registered Securities by any Holder and sale of all the
Registrable Securities pursuant to any registration statement and shall remain
in full force and effect, regardless of any investigation made by or on behalf
of any Holder or such director, officer or participating or controlling Person.
9. CERTAIN ADDITIONAL LIMITATIONS ON REGISTRATION RIGHTS.
Notwithstanding the other provisions of this Agreement, the Company shall not be
obligated to register the Registrable Securities of any Holder (i) if, in the
opinion of counsel to the Company reasonably satisfactory to the Holder and its
counsel (or, if the Holder has engaged an investment banking firm, to such
investment banking firm and its counsel), the sale or other disposition of such
Holder's Registrable Securities, in the manner proposed by such Holder (or by
such investment banking firm), may be effected without registering such
Registrable Securities under the Securities Act, (ii) such Holder or any
underwriter of such Registrable Securities shall fail to furnish to the Company
necessary information in respect of the distribution of such Registrable
Securities, or (iii) if such registration involves an underwritten offering,
such Registrable Securities are not included in such underwritten offering on
the same terms and conditions as shall be
13
applicable to the other Securities being sold through underwriters in the
registration or such Holder fails to enter into an underwriting agreement in
customary form with the underwriter or underwriters selected for such
underwritten offering. In addition, each Holder agrees not to effect any public
sale or distribution of any Registrable Securities or of any securities
convertible into or exchangeable or exercisable for such Registrable Securities,
including a sale pursuant to Rule 144 under the Securities Act and to enter into
a customary lock-up agreement with the managing underwriter for an offering,
during the 90-day period beginning on the effective date of any Demand
Registration Statement (initiated by such Holder) or Piggy-Back Registration
Statement or other underwritten offering (initiated by the Company) (except as
part of such registration), if and to the extent requested by the managing
underwriter for such offering.
10. LIMITATIONS ON REGISTRATION OF OTHER SECURITIES;
REPRESENTATION. From and after the date of this Agreement, the Company shall
not, without the prior written consent of a majority in interest of the Holders,
enter into any agreement with any holder or prospective holder of any Securities
of the Company giving such holder or prospective holder any registration rights
the terms of which are as or more favorable taken as a whole than the
registration rights granted to the Holders hereunder unless the Company shall
also give such rights to the Holders hereunder.
11. NO INCONSISTENT AGREEMENTS. The Company will not
hereafter enter into any agreement with respect to its Securities which is
inconsistent in any material respects with the rights granted to the Holders in
this Agreement.
12. SELECTION OF MANAGING UNDERWRITERS. The managing
underwriter or underwriters for any offering of Registrable Securities to be
registered pursuant to Sections 2 or 3 hereto shall be selected by Holders of a
majority of the shares being so registered and shall be reasonably acceptable to
the Company.
13. MISCELLANEOUS.
(a) REMEDIES. Each Holder, in addition to being entitled to
exercise all rights granted by law, including recovery of damages, will be
entitled to specific performance of its rights under this Agreement. 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. In any action or proceeding brought to enforce
any provision of this Agreement or where any provision hereof is validly
asserted as a defense, the successful party shall be entitled to recover
reasonable attorneys' fees in addition to any other available remedy.
(b) AMENDMENTS AND WAIVERS. Except as otherwise provided
herein, the provisions of this Agreement may not be amended, modified or
supplemented, and waivers or consents to departure from the provisions hereof
may not be given unless the Company has obtained the written consent of a
majority in interest of the Holders.
14
(c) NOTICE GENERALLY. Any notice, demand, request, consent,
approval, declaration, delivery or other communication hereunder to be made
pursuant to the provisions of this Agreement shall be sufficiently given or made
if in writing and either delivered in person with receipt acknowledged or sent
by overnight courier mail, return receipt requested, postage prepaid, or by
facsimile and confirmed by facsimile answerback, addressed as follows:
(i) If to any Holder, at its last known address
appearing on the books of the Company maintained for such purpose.
(ii) If to the Company, at
Metromedia Fiber Network, Inc.
000 Xxxxxxxx Xxxxxx
Xxxxx Xxxxxx, Xxx Xxxx 00000
Attention: Xxxxxx X. Xxxxxx, Esq.
Facsimile: (000) 000-0000
with a copy to:
Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx
1285 Avenue of the Americas
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxxx X. Xxxx, Esq.
Facsimile: (000) 000-0000
or at such other address as may be substituted by notice given as herein
provided.
The giving of any notice required hereunder may be waived in
writing by the party entitled to receive such notice. Every notice, demand,
request, consent, approval, declaration, delivery or other communication
hereunder shall be deemed to have been duly given or served on the date on which
personally delivered, with receipt acknowledged, fasimiled and confirmed by
fasimile answerback or three (3) Business Days after the same shall have been
sent by overnight courier.
(d) SUCCESSORS AND ASSIGNS; THIRD PARTY BENEFICIARIES. This
Agreement shall inure to the benefit of and be binding upon the successors and
permitted assigns of the parties hereto as hereinafter provided. The
registration rights of each of the Holders with respect shall be, with respect
to any Registrable Securities, transferred, with the consent of the Company,
which consent shall not be unreasonably withheld, to any Person who is the
transferee of such Registrable Securities. All of the obligations of the Company
hereunder shall survive any such transfer. Except as provided in Article 8, no
Person other than the parties hereto and their successors and permitted assigns
is intended to be a beneficiary of this Agreement.
(e) HEADINGS. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
15
(f) GOVERNING LAW; JURISDICTION. This Agreement shall be
governed by, construed and enforced in accordance with the laws of the State of
New York without giving effect to the conflict of laws provisions thereof. Each
of the parties hereby submits to personal jurisdiction and waives any objection
as to venue in the County of New York, State of New York. Service of process on
the parties in any action arising out of or relating to this Agreement shall be
effective if mailed to the parties in accordance with Section 13(c) hereof. The
parties hereto waive all right to trial by jury in any action or proceeding to
enforce or defend any rights hereunder.
(g) SEVERABILITY. Wherever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement shall be prohibited by or
invalid under applicable law, such provision shall be ineffective to the extent
of such prohibition or invalidity, without invalidating the remainder of such
provision or the remaining provisions of this Agreement.
(h) ENTIRE AGREEMENT. This Agreement represents the
complete agreement and understanding of the parties hereto in respect of the
subject matter contained herein. This Agreement supersedes all prior
agreements and understandings between the parties with respect to the subject
matter hereof.
[Signature appears on next page]
16
IN WITNESS WHEREOF, the undersigned have executed, or have
caused to be executed, this Agreement on the date first written above.
METROMEDIA FIBER NETWORK, INC.
By: /s/ Xxxx Xxxxx
--------------------------------------
Name: Xxxx Xxxxx
Title: President & COO
XXXX X. XXXXX, XXXXX
MANHATTAN BANK AND XXXXXX
XXXXXXXXX, TRUSTEES UNDER A
TRUST AGREEMENT BETWEEN
XXXX X. XXXXX, AS GRANTOR,
AND XXXX X. XXXXX AND
MANUFACTURERS HANOVER TRUST
COMPANY, AS TRUSTEES, DATED
MAY 30, 1984, AS AMENDED
AND RESTATED
By: /s/ Xxxxxx Xxxxxxxxx
---------------------------------------
Name: Xxxxxx Xxxxxxxxx
Title: Trustee
XXXXX XXXXXXXXXXX
By: Rockefeller & Co., Inc., as
Attorney-in-Fact
By: /s/ Xxxxxxx X. Xxxxxxxxx
--------------------------------------
Name: Xxxxxxx X. Xxxxxxxxx
Title: Authorized Signatory
/s/ Xxxxxxx X. Xxxxxxxx
------------------------------------------
Xxxxxxx X. Xxxxxxxx
