Exhibit 10.02
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT dated January 23, 2004 (the
"Agreement") is entered into by and among Portola Packaging, Inc., a Delaware
corporation (the "Company"), the guarantors listed in Schedule 1 hereto (the
"Guarantors"), and X.X. Xxxxxx Securities Inc. ("JPMorgan") and the Initial
Purchasers listed in Schedule 2 hereto (collectively with JPMorgan, the "Initial
Purchasers").
The Company, the Guarantors and the Initial Purchasers are parties to
the Purchase Agreement dated January 20, 2004 (the "Purchase Agreement"), which
provides for the sale by the Company to the Initial Purchasers of $180,000,000
aggregate principal amount of the Company's 8 1/4% Senior Notes due 2012 (the
"Securities") which will be guaranteed on an unsecured senior basis by each of
the Guarantors. As an inducement to the Initial Purchasers to enter into the
Purchase Agreement, the Company and the Guarantors have agreed to provide to the
Initial Purchasers and their direct and indirect transferees and to the
Market-Maker (as herein defined) the registration rights set forth in this
Agreement. The execution and delivery of this Agreement is a condition to the
closing under the Purchase Agreement.
In consideration of the foregoing, the parties hereto agree as follows:
1. Definitions. As used in this Agreement, the following terms shall
have the following meanings:
"Business Day" shall mean any day that is not a Saturday, Sunday or
other day on which commercial banks in New York City are authorized or required
by law to remain closed.
"Closing Date" shall mean the Closing Date as defined in the Purchase
Agreement.
"Company" shall have the meaning set forth in the preamble and shall
also include the Company's successors.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended from time to time.
"Exchange Dates" shall have the meaning set forth in Section 2(a)(ii)
hereof.
"Exchange Offer" shall mean the exchange offer by the Company and the
Guarantors of Exchange Securities for Registrable Securities pursuant to Section
2(a) hereof.
"Exchange Offer Registration" shall mean a registration under the
Securities Act effected pursuant to Section 2(a) hereof.
"Exchange Offer Registration Statement" shall mean an exchange offer
registration statement on Form S-4 (or, if applicable, on another appropriate
form) and all amendments and supplements to such registration statement, in each
case including the Prospectus contained therein, all exhibits thereto and any
document incorporated by reference therein.
"Exchange Securities" shall mean senior notes issued by the Company and
guaranteed by the Guarantors under the Indenture containing terms identical to
the Securities (except that the Exchange Securities will not be subject to
restrictions on transfer or to any increase in annual interest rate for failure
to comply with this Agreement) and to be offered to Holders of Securities in
exchange for Securities pursuant to the Exchange Offer.
"Guarantors" shall have the meaning set forth in the preamble and shall
also include any Guarantor's successors.
"Holders" shall mean the Initial Purchasers, for so long as they own
any Registrable Securities, and each of their successors, assigns and direct and
indirect transferees who become owners of Registrable Securities under the
Indenture; provided that for purposes of Sections 4, 5 and 6 of this Agreement,
the term "Holders" shall include Participating Broker-Dealers.
"Indenture" shall mean the Indenture relating to the Securities dated
as of January 23, 2004 among the Company, the Guarantors and U.S. Bank, National
Association, as trustee, and as the same may be amended from time to time in
accordance with the terms thereof.
"Initial Purchasers" shall have the meaning set forth in the preamble.
"JPMorgan" shall have the meaning set forth in the preamble.
"Majority Holders" shall mean the Holders of a majority of the
aggregate principal amount of the outstanding Registrable Securities; provided
that whenever the consent or approval of Holders of a specified percentage of
Registrable Securities is required hereunder, any Registrable Securities owned
directly or indirectly by the Company or any of its affiliates shall not be
counted in determining whether such consent or approval was given by the Holders
of such required percentage or amount; provided, further, that if the Company
shall issue any additional Securities under the Indenture prior to consummation
of the Exchange Offer or the effectiveness of any Shelf Registration Statement,
such additional Securities and the Registrable Securities to which this
Agreement relates shall be treated together as one class for purposes of
determining whether the consent or approval of Holders of a specified percentage
of Registrable Securities has been obtained.
"Market-Maker" shall have the meaning set forth in Section 5(a) hereof.
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"Market-Maker Information" shall have the meaning set forth in Section
5(d) hereof.
"Market-Maker Registration Statement" shall have the meaning set forth
in Section 5(a)(i) hereof.
"Participating Broker-Dealers" shall have the meaning set forth in
Section 4(a) hereof.
"Person" shall mean an individual, partnership, limited liability
company, corporation, trust or unincorporated organization, or a government or
agency or political subdivision thereof.
"Prospectus" shall mean the prospectus included in a Registration
Statement, including any preliminary prospectus, and any such prospectus as
amended or supplemented by any prospectus supplement, including a prospectus
supplement with respect to the terms of the offering of any portion of the
Registrable Securities covered by a Shelf Registration Statement, and by all
other amendments and supplements to such prospectus, and in each case including
any document incorporated by reference therein.
"Purchase Agreement" shall have the meaning set forth in the preamble.
"Registrable Securities" shall mean the Securities; provided that the
Securities shall cease to be Registrable Securities (i) when a Registration
Statement with respect to such Securities has been declared effective under the
Securities Act and such Securities have been exchanged or disposed of pursuant
to such Registration Statement, (ii) when such Securities are eligible to be
sold pursuant to Rule 144(k) (or any similar provision then in force, but not
Rule 144A) under the Securities Act, (iii) when such Securities have been sold
pursuant to Rule 144 under the Securities Act or (iii) when such Securities
cease to be outstanding.
"Registration Expenses" shall mean any and all expenses incident to
performance of or compliance by the Company and the Guarantors with this
Agreement, including without limitation: (i) all SEC, stock exchange or National
Association of Securities Dealers, Inc. registration and filing fees, (ii) all
fees and expenses incurred in connection with compliance with state securities
or blue sky laws (including reasonable fees and disbursements of one counsel for
any Underwriters or one counsel for Holders in connection with blue sky
qualification of any Exchange Securities or Registrable Securities), (iii) all
expenses of any Persons in preparing or assisting in preparing, word processing,
printing and distributing any Registration Statement, any Prospectus and any
amendments or supplements thereto, any underwriting agreements, securities sales
agreements or other similar agreements and any other documents relating to the
performance of and compliance with this Agreement, (iv) all rating agency fees,
(v) all fees and disbursements relating to the qualification of the Indenture
under applicable securities laws, (vi) the fees and disbursements of the Trustee
and its counsel, (vii) the fees and disbursements of counsel for the Company and
the Guarantors and, in the case
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of a Shelf Registration Statement, the reasonable fees and disbursements of one
counsel for the Holders (which counsel shall be selected by the Majority Holders
and which counsel may also be counsel for the Initial Purchasers) and (viii) the
fees and disbursements of the independent public accountants of the Company and
the Guarantors, including the expenses of any special audits or "comfort"
letters required by or incident to the performance of and compliance with this
Agreement, but excluding fees and expenses of counsel to the Underwriters (other
than reasonable fees and expenses set forth in clause (ii) above) or the Holders
and underwriting discounts and commissions, brokerage commissions and transfer
taxes, if any, relating to the sale or disposition of Registrable Securities by
a Holder.
"Registration Statement" shall mean any registration statement of the
Company and the Guarantors that covers any of the Exchange Securities or
Registrable Securities pursuant to the provisions of this Agreement, including,
without limitation, the Market-Making Registration Statement, and all amendments
and supplements to any such registration statement, including post-effective
amendments, in each case including the Prospectus contained therein, all
exhibits thereto and any document incorporated by reference therein.
"SEC" shall mean the United States Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended from
time to time.
"Shelf Additional Interest Date" shall have the meaning set forth in
Section 2(d) hereof.
"Shelf Effectiveness Period" shall have the meaning set forth in
Section 2(b) hereof.
"Shelf Registration" shall mean a registration effected pursuant to
Section 2(b) hereof.
"Shelf Registration Statement" shall mean a "shelf" registration
statement of the Company and the Guarantors that covers all the Registrable
Securities (but no other securities unless approved by the Holders whose
Registrable Securities are to be covered by such Shelf Registration Statement)
on an appropriate form under Rule 415 under the Securities Act, or any similar
rule that may be adopted by the SEC, and all amendments and supplements to such
registration statement, including post-effective amendments, in each case
including the Prospectus contained therein, all exhibits thereto and any
document incorporated by reference therein.
"Shelf Request" shall have the meaning set forth in Section 2(b)
hereof.
"Staff" shall mean the staff of the SEC.
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"Target Registration Date" shall have the meaning set forth in Section
2(d) hereof.
"Trust Indenture Act" shall mean the Trust Indenture Act of 1939, as
amended from time to time.
"Trustee" shall mean the trustee with respect to the Securities under
the Indenture.
"Underwriter" shall have the meaning set forth in Section 3(e) hereof.
"Underwritten Offering" shall mean an offering in which Registrable
Securities are sold to an Underwriter for reoffering to the public.
2. Registration Under the Securities Act. a) To the extent not
prohibited by any applicable law or applicable interpretations of the Staff, the
Company and the Guarantors shall use their reasonable best efforts to (i) cause
to be filed an Exchange Offer Registration Statement covering an offer to the
Holders to exchange all the Registrable Securities for Exchange Securities and
(ii) have such Exchange Offer Registration Statement remain effective until 180
days after the closing of the Exchange Offer. The Company and the Guarantors
shall commence the Exchange Offer promptly after the Exchange Offer Registration
Statement is declared effective by the SEC and use their reasonable best efforts
to complete the Exchange Offer not later than 30 days after such effective date.
The Company and the Guarantors shall commence the Exchange Offer by
mailing the related Prospectus, appropriate letters of transmittal and other
accompanying documents to each Holder stating, in addition to such other
disclosures as are required by applicable law, substantially the following:
(i) that the Exchange Offer is being made pursuant to this Agreement and
that all Registrable Securities validly tendered and not properly
withdrawn will be accepted for exchange;
(ii) the dates of acceptance for exchange (which shall be a period of at
least 20 Business Days from the date such notice is mailed) (the
"Exchange Dates");
(iii) that any Registrable Security not tendered will remain outstanding and
continue to accrue interest but will not retain any rights under this
Agreement;
(iv) that any Holder electing to have a Registrable Security exchanged
pursuant to the Exchange Offer will be required to surrender such
Registrable Security, together with the appropriate letters of
transmittal, to the institution and at the address (located in the
Borough of Manhattan, The City of New York) and in the manner specified
in the notice, prior to the close of business on the last Exchange
Date; and
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(v) that any Holder will be entitled to withdraw its election, not later
than the close of business on the last Exchange Date, by sending to the
institution and at the address (located in the Borough of Manhattan,
The City of New York) specified in the notice, a telegram, telex,
facsimile transmission or letter setting forth the name of such Holder,
the principal amount of Registrable Securities delivered for exchange
and a statement that such Holder is withdrawing its election to have
such Securities exchanged.
As a condition to participating in the Exchange Offer, a Holder will be
required to represent to the Company and the Guarantors that (i) any Exchange
Securities to be received by it will be acquired in the ordinary course of its
business, (ii) at the time of the commencement of the Exchange Offer it has no
arrangement or understanding with any Person to participate in the distribution
(within the meaning of the Securities Act) of the Exchange Securities in
violation of the provisions of the Securities Act, (iii) it is not an
"affiliate" (within the meaning of Rule 405 under the Securities Act) of the
Company or any Guarantor and (iv) if such Holder is a broker-dealer that will
receive Exchange Securities for its own account in exchange for Registrable
Securities that were acquired as a result of market-making or other trading
activities, then such Holder will deliver a Prospectus in connection with any
resale of such Exchange Securities.
As soon as practicable after the last Exchange Date, the Company and
the Guarantors shall:
(i) accept for exchange Registrable Securities or portions thereof validly
tendered and not properly withdrawn pursuant to the Exchange Offer; and
(ii) deliver, or cause to be delivered, to the Trustee for cancellation all
Registrable Securities or portions thereof so accepted for exchange by
the Company and issue, and cause the Trustee to promptly authenticate
and deliver to each Holder, Exchange Securities equal in principal
amount to the principal amount of the Registrable Securities
surrendered by such Holder.
The Company and the Guarantors shall use their reasonable best efforts
to complete the Exchange Offer as provided above and shall comply with the
applicable requirements of the Securities Act, the Exchange Act and other
applicable laws and regulations in connection with the Exchange Offer. The
Exchange Offer shall not be subject to any conditions, other than that the
Exchange Offer does not violate any applicable law or applicable interpretations
of the Staff.
(b) In the event that (i) the Company and the Guarantors determine that
the Exchange Offer Registration provided for in Section 2(a) above is not
available or may not be completed as soon as practicable after the last Exchange
Date because it would violate any applicable law or applicable interpretations
of the Staff of the SEC, (ii) the Exchange Offer is not for any other reason
completed by August 20, 2004 or (iii) upon receipt of a written request (a
"Shelf Request") from any Initial Purchaser representing that it holds
Registrable Securities that are ineligible to be exchanged in the Exchange
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Offer, the Company and the Guarantors shall use their reasonable best efforts to
cause to be filed as soon as reasonably practicable after such determination,
date or Shelf Request, as the case may be, so long as the Exchange Offer has not
been consummated within such time, a Shelf Registration Statement providing for
the sale of all the Registrable Securities by the Holders thereof and to have
such Shelf Registration Statement declared effective by the SEC.
In the event that the Company and the Guarantors are required to file a
Shelf Registration Statement pursuant to clause (iii) of the preceding sentence,
the Company and the Guarantors shall use their reasonable best efforts to file
and have declared effective by the SEC both an Exchange Offer Registration
Statement pursuant to Section 2(a) with respect to all Registrable Securities
and a Shelf Registration Statement (which may be a combined Registration
Statement with the Exchange Offer Registration Statement) with respect to offers
and sales of Registrable Securities held by the Initial Purchasers after
completion of the Exchange Offer.
The Company and the Guarantors agree to use their reasonable best
efforts to keep the Shelf Registration Statement continuously effective until
the expiration of the period referred to in Rule 144(k) (or any similar rule
then in force, but not Rule 144A) under the Securities Act with respect to the
Registrable Securities or such shorter period that will terminate when all the
Registrable Securities covered by the Shelf Registration Statement have been
sold pursuant to the Shelf Registration Statement (the "Shelf Effectiveness
Period"). The Company and the Guarantors further agree to supplement or amend
the Shelf Registration Statement and the related Prospectus if required by the
rules, regulations or instructions applicable to the registration form used by
the Company for such Shelf Registration Statement or by the Securities Act or by
any other rules and regulations thereunder for shelf registration or if
reasonably requested by a Holder of Registrable Securities with respect to
information relating to such Holder, and to use their reasonable best efforts to
cause any such amendment to become effective and such Shelf Registration
Statement and Prospectus to become usable as soon as thereafter practicable. The
Company and the Guarantors agree to furnish to the Holders of Registrable
Securities included within the coverage of the Shelf Registration Statement
copies of any such supplement or amendment promptly after its being used or
filed with the SEC.
(c) The Company and the Guarantors shall pay all Registration Expenses
in connection with the registration pursuant to Section 2(a) and Section 2(b)
hereof. Each Holder shall pay all underwriting discounts and commissions,
brokerage commissions and transfer taxes, if any, relating to the sale or
disposition of such Holder's Registrable Securities pursuant to the Shelf
Registration Statement.
(d) An Exchange Offer Registration Statement pursuant to Section 2(a)
hereof or a Shelf Registration Statement pursuant to Section 2(b) hereof will
not be deemed to have become effective unless it has been declared effective by
the SEC.
In the event that either the Exchange Offer is not completed or the
Shelf Registration Statement, if required pursuant to Section 2(b)(i) or Section
2(b)(ii) hereof,
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is not declared effective on or prior to August 20, 2004 (the "Target
Registration Date"), the interest rate on the Registrable Securities will be
increased by (i) 0.25% per annum for the first 90-day period immediately
following the Target Registration Date and (ii) an additional 0.25% per annum
with respect to each subsequent 90-day period, in each case until the Exchange
Offer is completed or the Shelf Registration Statement, if required hereby, is
declared effective by the SEC or the Securities become freely tradable under the
Securities Act, up to a maximum of 1.00% per annum of additional interest. In
the event the Company receives a Shelf Request pursuant to Section 2(b)(iii),
and the Shelf Registration Statement required to be filed thereby is not
declared effective by the later of (x) July 21, 2004 or (y) 90 days after the
delivery of such Shelf Request (such later date being hereinafter referred to as
the "Shelf Additional Interest Date"), then the interest rate on the Registrable
Securities will be increased by (i) 0.25% per annum for the first 90-day period
payable commencing from one day after the Shelf Additional Interest Date and
(ii) an additional 0.25% per annum with respect to each subsequent 90-day
period, in each case until the Shelf Registration Statement is declared
effective, up to a maximum of 1.00% per annum of additional interest.
If the Shelf Registration Statement has been declared effective and
thereafter either ceases to be effective or the Prospectus contained therein
ceases to be usable at any time during the Shelf Effectiveness Period, and such
failure to remain effective or usable exists for more than 45 days (whether or
not consecutive) in any 12-month period, then the interest rate on the
Registrable Securities will be increased by (i) 0.25% per annum for the first
90-day period commencing on the 45th day in such 12-month period, and (ii) an
additional 0.25% per annum with respect to each subsequent 90-day period, in
each case ending on such date that the Shelf Registration Statement has again
been declared effective or the Prospectus again becomes usable, up to a maximum
of 1.00% per annum of additional interest.
(e) Without limiting the remedies available to the Initial Purchasers
and the Holders, the Company and the Guarantors acknowledge that any failure by
the Company or the Guarantors to comply with their obligations under Section
2(a) and Section 2(b) hereof may result in material irreparable injury to the
Initial Purchasers or the Holders for which there is no adequate remedy at law,
that it will not be possible to measure damages for such injuries precisely and
that, although monetary damages will be limited to the amounts specified in
Section 2(d) hereof, in the event of any such failure, the Initial Purchasers or
any Holder may obtain such other relief as may be required to specifically
enforce the Company's and the Guarantors' obligations under Section 2(a) and
Section 2(b) hereof.
3. Registration Procedures. (a) In connection with their obligations
pursuant to Section 2(a) and Section 2(b) hereof, the Company and the Guarantors
shall:
(i) prepare and file with the SEC a Registration Statement on the
appropriate form under the Securities Act, which form (x) shall be
selected by the Company and the Guarantors, (y) shall, in the case of a
Shelf Registration, be available for the sale of the Registrable
Securities by the selling Holders thereof and (z) shall
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comply as to form in all material respects with the requirements of the
applicable form and include all financial statements required by the
SEC to be filed therewith; and use their reasonable best efforts to
cause such Registration Statement to become effective and remain
effective for the applicable period in accordance with Section 2
hereof;
(ii) prepare and file with the SEC such amendments and post-effective
amendments to each Registration Statement as may be necessary to keep
such Registration Statement effective for the applicable period in
accordance with Section 2 hereof and cause each Prospectus to be
supplemented by any required prospectus supplement and, as so
supplemented, to be filed pursuant to Rule 424 under the Securities
Act; and keep each Prospectus current during the period described in
Section 4(3) of and Rule 174 under the Securities Act that is
applicable to transactions by brokers or dealers with respect to the
Registrable Securities or Exchange Securities;
(iii) in the case of a Shelf Registration, furnish to each Holder of
Registrable Securities included within the coverage of the Shelf
Registration Statement, to counsel for the Initial Purchasers, to
counsel for such Holders and to each Underwriter of an Underwritten
Offering of Registrable Securities, if any, without charge, as many
copies as reasonably requested of each Prospectus, including each
preliminary Prospectus, and any amendment or supplement thereto, in
order to facilitate the sale or other disposition of the Registrable
Securities thereunder; and the Company and the Guarantors consent to
the use of such Prospectus and any amendment or supplement thereto in
accordance with applicable law by each of the selling Holders of
Registrable Securities and any such Underwriters in connection with the
offering and sale of the Registrable Securities covered by and in the
manner described in such Prospectus or any amendment or supplement
thereto in accordance with applicable law;
(iv) use their reasonable best efforts to register or qualify the
Registrable Securities under all applicable state securities or blue
sky laws of such jurisdictions as any Holder of Registrable Securities
covered by a Registration Statement shall reasonably request in writing
by the time the applicable Registration Statement is declared effective
by the SEC; cooperate with such Holders in connection with any filings
required to be made with the National Association of Securities
Dealers, Inc.; and do any and all other acts and things that may be
reasonably necessary to enable each Holder to complete the disposition
in each such jurisdiction of the Registrable Securities owned by such
Holder; provided that neither the Company nor any Guarantor shall be
required to (1) qualify as a foreign corporation or other entity or as
a dealer in securities in any such jurisdiction where it would not
otherwise be required to so qualify, (2) file any general consent to
service of process in any such jurisdiction or (3) subject itself to
taxation in any such jurisdiction if it is not so subject;
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(v) in the case of a Shelf Registration, notify each Holder of Registrable
Securities included within the coverage of the Shelf Registration
Statement, counsel for such Holders and counsel for the Initial
Purchasers promptly and, if requested by any such Holder or counsel,
confirm such advice in writing (1) when a Shelf Registration Statement
has become effective and when any post-effective amendment thereto has
been filed and becomes effective, (2) of any request by the SEC or any
state securities authority for amendments and supplements to a Shelf
Registration Statement and Prospectus or for additional information
after the Shelf Registration Statement has become effective, (3) of the
issuance by the SEC or any state securities authority of any stop order
suspending the effectiveness of a Shelf Registration Statement or the
initiation of any proceedings for that purpose, (4) if, between the
effective date of a Shelf Registration Statement and the closing of any
sale of Registrable Securities covered thereby, the representations and
warranties of the Company or any Guarantor contained in any
underwriting agreement, securities sales agreement or other similar
agreement, if any, relating to an offering of such Registrable
Securities cease to be true and correct in all material respects or if
the Company or any Guarantor receives any notification with respect to
the suspension of the qualification of the Registrable Securities for
sale in any jurisdiction or the initiation of any proceeding for such
purpose, (5) of the happening of any event during the period a Shelf
Registration Statement is effective that makes any statement made in
such Shelf Registration Statement or the related Prospectus untrue in
any material respect or that requires the making of any changes in such
Shelf Registration Statement or Prospectus in order to make the
statements therein not misleading and (6) of any determination by the
Company or any Guarantor that a post-effective amendment to a Shelf
Registration Statement would be appropriate;
(vi) use their reasonable best efforts to obtain the withdrawal of any order
suspending the effectiveness of a Registration Statement at the
earliest possible moment and provide immediate notice to each Holder of
the withdrawal of any such order;
(vii) in the case of a Shelf Registration, furnish to each Holder of
Registrable Securities included within the coverage of the Shelf
Registration Statement, without charge, at least one conformed copy of
each Registration Statement and any post-effective amendment thereto
(without any documents incorporated therein by reference or exhibits
thereto, unless requested);
(viii) in the case of a Shelf Registration, cooperate with the Holders of
Registrable Securities included within the coverage of the Shelf
Registration Statement to facilitate the timely preparation and
delivery of certificates representing Registrable Securities to be sold
and not bearing any restrictive legends and enable such Registrable
Securities to be issued in such denominations and registered in such
names (consistent with the provisions of the Indenture) as such Holders
may reasonably request at least one Business Day prior to the closing
of any sale of Registrable Securities;
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(ix) in the case of a Shelf Registration, upon the occurrence of any event
contemplated by Section 3(a)(v)(5) hereof, use their reasonable best
efforts to prepare and file with the SEC a supplement or post-effective
amendment to a Shelf Registration Statement or the related Prospectus
or any document incorporated therein by reference or file any other
required document so that, as thereafter delivered to purchasers of the
Registrable Securities, such Prospectus will not contain any untrue
statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under
which they were made, not misleading; and the Company and the
Guarantors shall notify the Holders of Registrable Securities included
within the coverage of the Shelf Registration Statement to suspend use
of the Prospectus as promptly as practicable after the occurrence of
such an event, and such Holders hereby agree to suspend use of the
Prospectus until the Company and the Guarantors have amended or
supplemented the Prospectus to correct such misstatement or omission;
(x) a reasonable time prior to the filing of any Registration Statement,
any Prospectus, any amendment to a Registration Statement or amendment
or supplement to a Prospectus or of any document that is to be
incorporated by reference into a Registration Statement or a Prospectus
after initial filing of a Registration Statement, provide copies of
such document to the Initial Purchasers and their counsel (and, in the
case of a Shelf Registration Statement, to the Holders of Registrable
Securities included within the coverage of the Shelf Registration
Statement and their counsel) and make such of the representatives of
the Company and the Guarantors as shall be reasonably requested by the
Initial Purchasers or their counsel (and, in the case of a Shelf
Registration Statement, the Holders of Registrable Securities included
within the coverage of the Shelf Registration Statement or their
counsel) available for discussion of such document; and the Company and
the Guarantors shall not, at any time after initial filing of a
Registration Statement, file any Prospectus, any amendment of or
supplement to a Registration Statement or a Prospectus, or any document
that is to be incorporated by reference into a Registration Statement
or a Prospectus, of which the Initial Purchasers and their counsel
(and, in the case of a Shelf Registration Statement, the Holders of
Registrable Securities and their counsel) shall not have previously
been advised and furnished a copy or to which the Initial Purchasers or
their counsel (and, in the case of a Shelf Registration Statement, the
Holders of Registrable Securities included within the coverage of the
Shelf Registration Statement or their counsel) shall reasonably object
within a reasonable period of time (not to exceed five Business Days)
after receipt of such documents;
(xi) obtain a CUSIP number for all Exchange Securities or Registrable
Securities, as the case may be, not later than the effective date of a
Registration Statement;
(xii) cause the Indenture to be qualified under the Trust Indenture Act in
connection with the registration of the Exchange Securities or
Registrable Securities, as the
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case may be; cooperate with the Trustee and the Holders to effect such
changes to the Indenture as may be required for the Indenture to be so
qualified in accordance with the terms of the Trust Indenture Act; and
execute, and use their reasonable best efforts to cause the 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 the Indenture to be so qualified in a timely manner;
(xiii) in the case of a Shelf Registration, make available for inspection by a
representative of the Holders of the Registrable Securities included
within the coverage of the Shelf Registration Statement (an
"Inspector"), any Underwriter participating in any disposition pursuant
to such Shelf Registration Statement, any attorneys and accountants
designated by the Holders of Registrable Securities and any attorneys
designated by such Underwriter, at reasonable times and in a reasonable
manner, all pertinent financial and other records, documents and
properties of the Company and the Guarantors, and cause the respective
officers, directors and employees of the Company and the Guarantors to
supply all information reasonably requested by any such Inspector,
Underwriter, attorney or accountant in connection with a Shelf
Registration Statement; provided that if any such information is
identified by the Company or any Guarantor as being confidential or
proprietary, each Person receiving such information shall, prior to
being given such information, agree to maintain the confidentiality of
such information and take such actions as are reasonably necessary to
protect the confidentiality of such information to the extent such
action is otherwise not inconsistent with, an impairment of or in
derogation of the rights and interests of any Inspector, Holder or
Underwriter);
(xiv) in the case of a Shelf Registration, use their reasonable best efforts
to cause all Registrable Securities to be listed on any securities
exchange or any automated quotation system on which similar securities
issued or guaranteed by the Company or any Guarantor are then listed if
requested by the Majority Holders, to the extent such Registrable
Securities satisfy applicable listing requirements;
(xv) if reasonably requested by any Holder of Registrable Securities covered
by a Shelf Registration Statement, promptly incorporate in a Prospectus
supplement or post-effective amendment such information with respect to
such Holder as such Holder reasonably requests to be included therein
and make all required filings of such Prospectus supplement or such
post-effective amendment within two Business Days after the Company has
received notification of the matters to be incorporated in such filing;
and
(xvi) in the case of a Shelf Registration, enter into such customary
agreements and take all such other actions in connection therewith that
may be reasonably requested by the Holders of a majority in principal
amount of the Registrable Securities being sold in order to expedite or
facilitate the disposition of such Registrable Securities including,
but not limited to, an Underwritten Offering and in such connection,
(1) to the extent possible, make such representations and warranties to
the Holders
12
and any Underwriters of such Registrable Securities with respect to the
business of the Company and its subsidiaries, the Registration
Statement, Prospectus and documents incorporated by reference or deemed
incorporated by reference, if any, in each case, in form, substance and
scope as are customarily made by issuers to underwriters in
underwritten offerings and confirm the same if and when requested, (2)
in the case of an Underwritten Offering, obtain opinions of counsel to
the Company and the Guarantors (which counsel and opinions, in form,
scope and substance, shall be reasonably satisfactory to the Holders
and such Underwriters and their respective counsel) addressed to each
selling Holder and Underwriter of Registrable Securities, covering the
matters customarily covered in opinions requested in underwritten
offerings, (3) in the case of an Underwritten Offering, obtain
"comfort" letters from the independent certified public accountants of
the Company and the Guarantors (and, if necessary, any other certified
public accountant of any subsidiary of the Company or any Guarantor, or
of any business acquired by the Company or any Guarantor for which
financial statements and financial data are or are required to be
included in the Registration Statement) addressed to each selling
Holder and Underwriter of Registrable Securities, such letters to be in
customary form and covering matters of the type customarily covered in
"comfort" letters in connection with underwritten offerings and (4)
deliver such documents and certificates as may be reasonably requested
by the Holders of a majority in principal amount of the Registrable
Securities being sold or the Underwriters, and which are customarily
delivered in underwritten offerings, to evidence the continued validity
of the representations and warranties of the Company and the Guarantors
made pursuant to clause (1) above and to evidence compliance with any
customary conditions contained in an underwriting agreement.
(b) In the case of a Shelf Registration Statement, the Company or any
Guarantor may require each Holder of Registrable Securities to furnish to the
Company and the Guarantors such information regarding such Holder and the
proposed disposition by such Holder of such Registrable Securities as the
Company or the Guarantors may from time to time reasonably request in writing,
and the Company may exclude from the Shelf Registration Statement the
Registrable Securities of any Holder who does not provide such information
within a reasonable period of time after such request until the time such Holder
delivers such information.
(c) In the case of a Shelf Registration Statement, each Holder of
Registrable Securities agrees that, upon receipt of any notice from the Company
or the Guarantors of the happening of any event of the kind described in Section
3(a)(v)(3) or 3(a)(v)(5) hereof or a notice pursuant to the last sentence of
this paragraph, such Holder will forthwith discontinue disposition of
Registrable Securities pursuant to a Registration Statement until such Holder's
receipt of the copies of the supplemented or amended Prospectus contemplated by
Section 3(a)(ix) hereof and, if so directed by the Company and the Guarantors,
such Holder will deliver to the Company and the Guarantors all copies in its
possession, other than permanent file copies then in such Holder's possession,
of the Prospectus covering such Registrable Securities that is current at the
13
time of receipt of such notice. Notwithstanding the foregoing, the Company and
the Guarantors may, pending the announcement of a potential acquisition,
divestiture of assets or other material corporate transaction, issue a notice
that the Shelf Registration Statement is no longer effective or the Prospectus
contained therein is no longer usable for offers and sales of Registrable
Securities and may issue any notice suspending use of the Shelf Registration
Statement or the Prospectus contained therein and in the event that the
aggregate number of days in any consecutive 360-day period for which all such
notices are issued and effective exceed 45 days in the aggregate, then the
interest rate on the Registrable Securities will be increased by (i) 0.25% per
annum for the first 90-day period commencing on the 45th day in such 12-month
period, and (ii) an additional 0.25% per annum with respect to each subsequent
90-day period, in each case ending on such date that the Shelf Registration
Statement has again been declared effective or the Prospectus again becomes
usable, up to a maximum of 1.00% per annum of additional interest.
(d) If the Company and the Guarantors shall give any such notice to
suspend the disposition of Registrable Securities pursuant to a Registration
Statement, the Company and the Guarantors shall extend the period during which
the Registration Statement shall be maintained effective pursuant to this
Agreement by the number of days during the period from and including the date of
the giving of such notice to and including the date when the Holders of such
Registrable Securities shall have received copies of the supplemented or amended
Prospectus necessary to resume such dispositions. The Company and the Guarantors
may give any such notice only twice during any 365-day period and any such
suspensions shall not exceed 30 days for each suspension and there shall not be
more than two suspensions in effect during any 365-day period.
(e) The Holders of Registrable Securities covered by a Shelf
Registration Statement who desire to do so may sell such Registrable Securities
in an Underwritten Offering. In any such Underwritten Offering, the investment
banker or investment bankers and manager or managers (the "Underwriters") that
will administer the offering will be selected by the Majority Holders of the
Registrable Securities included in such offering, subject to the consent of the
Company, which consent shall not be unreasonably withheld or delayed.
4. Participation of Broker-Dealers in Exchange Offer. b) The Staff has
taken the position that any broker-dealer that receives Exchange Securities for
its own account in the Exchange Offer in exchange for Securities that were
acquired by such broker-dealer as a result of market-making or other trading
activities (a "Participating Broker-Dealer") may be deemed to be an
"underwriter" within the meaning of the Securities Act and must deliver a
prospectus meeting the requirements of the Securities Act in connection with any
resale of such Exchange Securities.
The Company and the Guarantors understand that it is the Staff's
position that if the Prospectus contained in the Exchange Offer Registration
Statement includes a plan of distribution containing a statement to the above
effect and the means by which
14
Participating Broker-Dealers may resell the Exchange Securities, without naming
the Participating Broker-Dealers or specifying the amount of Exchange Securities
owned by them, such Prospectus may be delivered by Participating Broker-Dealers
to satisfy their prospectus delivery obligation under the Securities Act in
connection with resales of Exchange Securities for their own accounts, so long
as the Prospectus otherwise meets the requirements of the Securities Act.
(a) In light of the above, and notwithstanding the other provisions of
this Agreement, the Company and the Guarantors agree to amend or supplement the
Prospectus contained in the Exchange Offer Registration Statement, as would
otherwise be contemplated by Section 3(a)(ix), for a period of up to 180 days
after the last Exchange Date (as such period may be extended pursuant to Section
3(d) of this Agreement), if requested by the Initial Purchasers or by one or
more Participating Broker-Dealers, in order to expedite or facilitate the
disposition of any Exchange Securities by Participating Broker-Dealers
consistent with the positions of the Staff recited in Section 4(a) above. The
Company and the Guarantors further agree that Participating Broker-Dealers shall
be authorized to deliver such Prospectus during such period in connection with
the resales contemplated by this Section 4.
(b) The Initial Purchasers shall have no liability to the Company, any
Guarantor or any Holder with respect to any request that they may make pursuant
to Section 4(b) above.
5. Market-Making. c) For so long as any of the Securities or Exchange
Securities are outstanding and JPMorgan (in such capacity, the "Market-Maker")
or any of its affiliates (as defined in the rules and regulations of the SEC)
owns any equity securities of the Company, the Guarantors or any of their
affiliates and proposes to make a market in the Securities or Exchange
Securities as part of its business in the ordinary course, the following
provisions shall apply for the sole benefit of the Market-Maker:
(i) The Company and the Guarantors shall (A) on the date that the Exchange
Offer Registration Statement is filed with the SEC, file a registration
statement (the "Market-Making Registration Statement") (which may be
the Exchange Offer Registration Statement or the Shelf Registration
Statement if permitted by the rules and regulations of the SEC) and use
their reasonable best efforts to cause such Market-Making Registration
Statement to be declared effective by the SEC on or prior to the
consummation of the Exchange Offer or the effective date of the Shelf
Registration Statement, as applicable; (B) periodically amend such
Market-Making Registration Statement so that the information contained
therein complies with the requirements of Section 10(a) under the
Securities Act; (C) amend the Market-Making Registration Statement or
amend or supplement the related Prospectus when necessary to reflect
any material changes in the information provided therein; and (D) amend
the Market-Making Registration Statement when required to do so in
order to comply with Section 10(a)(3) of the Securities Act; provided,
however, that (1) prior to filing the Market-Making Registration
Statement, any amendment thereto or any supplement to the related
Prospectus,
15
the Company will furnish to the Market-Maker copies of all such
documents proposed to be filed, which documents will be subject to the
review of the Market-Maker and its counsel, (2) the Company and the
Guarantors will not file the Market-Making Registration Statement, any
amendment thereto or any amendment or supplement to the related
Prospectus to which the Market-Maker and its counsel shall reasonably
object within a reasonable period of time (not to exceed five Business
Days) after receipt of such documents unless the Company is advised by
counsel that such Market-Making Registration Statement, amendment or
supplement is required to be filed and (3) the Company will provide the
Market-Maker and its counsel with copies of the Market-Making
Registration Statement and each amendment and supplement filed.
(ii) The Company shall notify the Market-Maker and, if requested by the
Market-Maker, confirm such advice in writing, (A) when any
post-effective amendment to the Market-Making Registration Statement or
any amendment or supplement to the related Prospectus has been filed,
and, with respect to any post-effective amendment, when the same has
become effective; (B) of any request by the SEC for any post-effective
amendment to the Market-Making Registration Statement, any supplement
or amendment to the related Prospectus or for additional information;
(C) the issuance by the SEC of any stop order suspending the
effectiveness of the Market-Making Registration Statement or the
initiation of any proceedings for that purpose; (D) of the receipt by
the Company of any notification with respect to the suspension of the
qualification of the Securities or Exchange Securities for sale in any
jurisdiction or the initiation or threatening of any proceedings for
such purpose; and (E) of the happening of any event that makes any
statement made in the Market-Making Registration Statement, the related
Prospectus or any amendment or supplement thereto untrue or that
requires the making of any changes in the Market-Making Registration
Statement, such Prospectus or any amendment or supplement thereto, in
order to make the statements therein not misleading.
(iii) If any event contemplated by Section 5(a)(ii)(B) through (E) occurs
during the period for which the Company and the Guarantors are required
to maintain an effective Market-Making Registration Statement, the
Company and the Guarantors shall promptly prepare and file with the SEC
a post-effective amendment to the Market-Making Registration Statement
or an amendment or supplement to the related Prospectus or file any
other required document so that the Prospectus will not include an
untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(iv) In the event of the issuance of any stop order suspending the
effectiveness of the Market-Making Registration Statement or of any
order suspending the qualification of the Securities or Exchange
Securities for sale in any jurisdiction, the Company and the Guarantors
shall use promptly their reasonable best efforts to obtain its
withdrawal.
16
(v) The Company shall furnish to the Market-Maker, without charge, (i) at
least one conformed copy of the Market-Making Registration Statement
and any post-effective amendment thereto; and (ii) as many copies of
the related Prospectus and any amendment or supplement thereto as the
Market-Maker may reasonably request.
(vi) The Company and the Guarantors shall consent to the use of the
Prospectus contained in the Market-Making Registration Statement or any
amendment or supplement thereto by the Market-Maker in connection its
market-making activities.
(vii) Notwithstanding the foregoing provisions of this Section 5, the Company
and the Guarantors may for valid business reasons, including without
limitation, a potential acquisition, divestiture of assets or other
material corporate transaction, issue a notice that the Market-Making
Registration Statement is no longer effective or the Prospectus
included therein is no longer usable for offers and sales of Securities
or Exchange Securities and may issue any notice suspending use of the
Market-Making Registration Statement required under applicable
securities laws to be issued; provided that the use of the
Market-Making Registration Statement shall not be suspended for more
than 60 days in the aggregate in any consecutive 12 month period. The
Market-Maker agrees that upon receipt of any notice from the Company
pursuant to this Section 5(a)(vii), it will discontinue use of the
Market-Making Registration Statement until receipt of copies of the
supplemented or amended Prospectus relating thereto or until advised in
writing by the Company that the use of the Market-Making Registration
Statement may be resumed.
(b) In connection with the Market-Making Registration Statement, the
Company shall (i) make reasonably available for inspection by a representative
of, and counsel acting for, the Market-Maker all relevant financial and other
records, pertinent corporate documents and properties of the Company and its
subsidiaries and (ii) use its reasonable best efforts to have its officers,
directors, employees, accountants and counsel supply all relevant information
reasonably requested by such representative or counsel or the Market-Maker.
(c) Prior to the effective date of the Market-Making Registration
Statement, the Company and the Guarantors will use their reasonable best efforts
to register or qualify the Securities or Exchange Securities for offer and sale
under the securities or blue sky laws of such jurisdictions as the Market-Maker
reasonably requests in writing and do any and all other acts or things necessary
to enable the offer and sale in such jurisdictions of the Securities or Exchange
Securities covered by the Market-Making Registration Statement; provided that
the Company and the Guarantors will not be required to (i) qualify as a foreign
corporation or other entity or as a dealer in securities in any jurisdiction
where it would not otherwise be required to so qualify, (ii) file any general
consent to subject itself to service of process in any such jurisdictions or
(iii) subject itself to taxation in any such jurisdiction if it not so subject.
17
(d) The Company represents and agrees that the Market-Making
Registration Statement, any post-effective amendments thereto, any amendments or
supplements to the related Prospectus and any documents filed by them under the
Exchange Act will, when they become effective or are filed with the SEC, as the
case may be, conform in all respects to the requirements of the Securities Act
and the Exchange Act and the rules and regulations of the SEC thereunder
(including, without limitation, any applicable rules and regulations adopted
pursuant to the Xxxxxxxx-Xxxxx Act) and will not, as of the effective date of
such Market-Making Registration Statement or post-effective amendments and as of
the filing date of amendments or supplements to such Prospectus or filings under
the Exchange Act, contain an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided that no representation or warranty is made as to
information contained in or omitted from the Market-Making Registration
Statement or the related Prospectus in reliance upon and in conformity with
written information furnished to the Company or the Guarantors by the
Market-Maker specifically for inclusion therein, which information the parties
hereto agree will be limited to the statements concerning the market-making
activities of the Market-Maker to be set forth on the cover page and in the
"Plan of Distribution" section of the Prospectus (the "Market-Maker's
Information").
(e) At the time of effectiveness of the Market-Making Registration
Statement and concurrently with each time the Market-Making Registration
Statement or the related Prospectus shall be amended or such Prospectus shall be
supplemented, the Company shall (if requested by the Market-Maker) furnish the
Market-Maker and its counsel with a certificate of its Chairman of the Board of
Directors or President and its Chief Financial Officer, on behalf of the
Company, to the effect that:
(i) the Market-Making Registration Statement has been declared effective;
(ii) in the case of an amendment to the Market-Making Registration
Statement, such amendment has become effective under the Securities Act
as of the date and time specified in such certificate, if applicable;
and in the case of an amendment or supplement to the Prospectus, such
amendment or supplement to the Prospectus was filed with the SEC
pursuant to the subparagraph of Rule 424(b) under the Securities Act
specified in such certificate on the date specified therein; (iii) to
the knowledge of such officers, no stop order suspending the
effectiveness of the Market-Making Registration Statement has been
issued and, to the knowledge of such officers, no proceeding for that
purpose is pending or threatened by the SEC; and (iv) such officers
have carefully examined the Market-Making Registration Statement and
the Prospectus (and, in the case of an amendment or supplement, such
amendment or supplement) and as of the date of such Market-Making
Registration Statement, amendment or supplement, as applicable, the
Market-Making Registration Statement and the Prospectus, as amended or
supplemented, if applicable, did not include any untrue statement of a
material fact and did not omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading.
18
(f) At the time of effectiveness of the Market-Making Registration
Statement and concurrently with each time the Market-Making Registration
Statement or the related Prospectus shall be amended or such Prospectus shall be
supplemented, the Company shall (if requested in writing by the Market-Maker and
such request is delivered within a reasonable period of time (not to exceed five
Business Days) after receipt of notice of such effectiveness, amendment or
supplement) furnish the Market-Maker and its counsel with the written opinion of
counsel for the Company reasonably satisfactory to the Market-Maker to the
effect that (and subject to customary assumptions, limitations and
qualifications):
(i) the Market-Making Registration Statement has been declared effective;
(ii) in the case of an amendment to the Market-Making Registration
Statement, such amendment has become effective under the Securities Act
as of the date and time specified in such opinion, if applicable; and
in the case of an amendment or supplement to the Prospectus, such
amendment or supplement to the Prospectus was filed with the SEC
pursuant to the subparagraph of Rule 424(b) under the Securities Act
specified in such opinion on the date specified therein; (iii) to the
knowledge of such counsel, no stop order suspending the effectiveness
of the Market-Making Registration Statement has been issued and, to the
knowledge of such counsel, no proceeding for that purpose is pending or
threatened by the SEC; and (iv) such counsel has reviewed the
Market-Making Registration Statement and the Prospectus (and, in the
case of an amendment or supplement, such amendment or supplement) and
participated with officers of the Company and independent public
accountants for the Company in the preparation of such Market-Making
Registration Statement and Prospectus (and, in the case of an amendment
or supplement, such amendment or supplement) and based on such
participation and review and the information that was disclosed to such
counsel, nothing has come to the attention of such counsel to cause
such counsel to believe that as of the date of such Market-Making
Registration Statement, amendment or supplement, as applicable, the
Market-Making Registration Statement, as amended or supplemented,
contained any untrue statement of a material fact or omitted to state
any material fact required to be stated therein or necessary in order
to make the statements therein not misleading or that the Prospectus,
as amended or supplemented, contained or contains any untrue statement
of a material fact or omitted or omits to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading (other than,
in each case, the financial statements and other financial and
statistical information contained therein, as to which such counsel
need express no belief). Such opinion will be consistent with the form
of negative assurance opinion delivered in connection with the Purchase
Agreement, with such revisions to reflect differences between private
and public offerings.
(g) At the time of effectiveness of the Market-Making Registration
Statement and concurrently with each time the Market-Making Registration
Statement or the related Prospectus shall be amended or such Prospectus shall be
supplemented to include audited annual financial information, the Company shall
(if requested in writing by the
19
Market-Maker and such request is delivered within a reasonable period of time
(not to exceed five Business Days) after receipt of notice of such
effectiveness, amendment or supplement) furnish the Market-Maker and its counsel
with a letter of each of PricewaterhouseCoopers LLP and, to the extent required
with respect to Tech Industries, Xxxxxxxx Xxxxxxxxxx Xxxxxxxx & Xxxxxxxxx, LLP
(or other independent public accountants for the Company or the Guarantors of
nationally recognized standing) in form satisfactory to the Market-Maker,
addressed to the Market-Maker and dated the date of delivery of such letter, (i)
confirming that they are independent public accountants within the meaning of
the Securities Act and are in compliance with the applicable requirements
relating to the qualification of accountants under Rule 2-01 of Regulation S-X
of the SEC and, (ii) in all other respects, substantially in the form of the
letter delivered to the Initial Purchasers pursuant to Section 5(g) of the
Purchase Agreement, with, in the case of an amendment or supplement to include
audited financial information, such changes as may be necessary to reflect the
amended or supplemented financial information.
(h) The Company and the Guarantors, on the one hand, and the
Market-Maker, on the other hand, hereby agree to indemnify each other, and, if
applicable, contribute to the other, in accordance with Section 6 of this
Agreement.
(i) The Company and the Guarantors will comply with the provisions of
this Section 5 at their own expense and will reimburse the Market-Maker for its
reasonable documented fees and disbursements associated with this Section 5
(including reasonable fees of counsel).
(j) The agreements contained in this Section 5 and the representations,
warranties and agreements contained in this Agreement shall survive all offers
and sales of the Securities and Exchange Securities and shall remain in full
force and effect, regardless of any termination or cancellation of this
Agreement or any investigation made by or on behalf of any indemnified party.
(k) For purposes of this Section 5, (i) any reference to the terms
"amend", "amendment" or "supplement" with respect to the Market-Making
Registration Statement or the Prospectus contained therein shall be deemed to
refer to and include the filing under the Exchange Act of any document deemed to
be incorporated therein by reference and (ii) any reference to the terms
"Securities" or "Exchange Securities" shall be deemed to refer to and include
any securities issued in exchange for or with respect to such Securities or
Exchange Securities.
6. Indemnification and Contribution. d) The Company and each Guarantor,
jointly and severally, agree to indemnify and hold harmless (i) each Initial
Purchaser, the Market-Maker and each Holder, their respective affiliates,
directors and officers and each Person, if any, who controls any Initial
Purchaser or any Holder within the meaning of Section 15 of the Securities Act
or Section 20 of the Exchange Act, from and against any and all losses, claims,
damages and liabilities (including, without limitation, legal fees and other
expenses incurred in connection with any suit, action or proceeding or any claim
asserted, as such fees and expenses are incurred), that arise out of, or are
based
20
upon, any untrue statement or alleged untrue statement of a material fact
contained in any Registration Statement or Market-Making Registration Statement
or any Prospectus or any omission or alleged omission to state therein a
material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, except insofar as such losses, claims, damages or
liabilities arise out of, or are based upon, (A) any untrue statement or
omission or alleged untrue statement or omission made in reliance upon and in
conformity with any information relating to any Initial Purchaser, information
relating to any Holder or the Market-Maker Information furnished to the Company
in writing through JPMorgan, any selling Holder or the Market-Maker,
respectively, expressly for use therein or (B) any untrue statement or omission
or alleged untrue statement or omission that was contained or made in any
related preliminary Prospectus, if both (1) a copy of the final Prospectus was
not sent or given by such initial Purchaser or Holder to such Person asserting
any such loss, claim, damage or liability on or prior to the written
confirmation of the sale of such Securities or Exchange Securities to such
Person and (2) the untrue statement in or omission from the related preliminary
Prospectus was corrected in the final Prospectus, unless, in either case, such
failure to deliver the final Prospectus was a result of non-compliance by the
Company or any Guarantor with the provisions of Section 3 hereof and (ii) the
Market-Maker from and against any and all losses claims, damages, and
liabilities (including, without limitation, legal fees and other expenses
incurred in connection with any suit, action or proceeding or any claim
asserted, as such fees and expenses are incurred), that arise out of, or are
based upon, any material breach by the Company of its representations,
warranties, and agreements contained in Section 5 hereof. In connection with any
Underwritten Offering permitted by Section 3 hereof, the Company and the
Guarantors, jointly and severally, will also indemnify the Underwriters, if any,
selling brokers, dealers and similar securities industry professionals
participating in the distribution, their respective affiliates and each Person
who controls such Persons (within the meaning of the Securities Act and the
Exchange Act) to the same extent as provided above with respect to the
indemnification of the Holders, if requested in connection with any Registration
Statement.
(a) Each Holder agrees, severally and not jointly, to indemnify and
hold harmless the Company, the Guarantors, the Initial Purchasers and the other
selling Holders, their respective affiliates, the directors of the Company and
the Guarantors, each officer of the Company and the Guarantors who signed the
Registration Statement and each Person, if any, who controls the Company, the
Guarantors, any Initial Purchaser and any other selling Holder within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act to
the same extent as the indemnity set forth in paragraph (a) above, but only with
respect to any losses, claims, damages or liabilities that arise out of, or are
based upon, any untrue statement or omission or alleged untrue statement or
omission made in reliance upon and in conformity with any information relating
to such Holder furnished to the Company in writing by such Holder expressly for
use in any Registration Statement and any Prospectus.
(b) The Market-Maker agrees to indemnify and hold harmless the Company
and the Guarantors, the directors of the Company and the Guarantors and each
officer of
21
the Company and the Guarantors who signed the Market-Making Registration
Statement and each Person, if any, who controls the Company or the Guarantors
within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act to the same extent as the indemnity set forth in paragraph (a)
above, but only with respect to any losses, claims, damages or liabilities that
arise out of, or are based upon, any untrue statement or omission or alleged
untrue statement or omission made in reliance upon and in conformity with any
Market-Maker's Information furnished to the Company in writing by the
Market-Maker expressly for use in any Market-Making Registration Statement or
any Prospectus.
(c) If any suit, action, proceeding (including any governmental or
regulatory investigation), claim or demand shall be brought or asserted against
any Person in respect of which indemnification may be sought pursuant to
paragraph (a), (b) or (c) above, such Person (the "Indemnified Person") shall
promptly notify the Person against whom such indemnification may be sought (the
"Indemnifying Person") in writing; provided that the failure to notify the
Indemnifying Person shall not relieve it from any liability that it may have
under this Section 6 except to the extent that it has been materially prejudiced
(through the forfeiture of substantive rights or defenses) by such failure; and
provided, further, that the failure to notify the Indemnifying Person shall not
relieve it from any liability that it may have to an Indemnified Person
otherwise than under this Section 6. If any such proceeding shall be brought or
asserted against an Indemnified Person and it shall have notified the
Indemnifying Person thereof, the Indemnifying Person shall retain counsel
reasonably satisfactory to the Indemnified Person to represent the Indemnified
Person and any others entitled to indemnification pursuant to this Section 6
that the Indemnifying Person may designate in such proceeding and shall pay the
reasonable fees and expenses of such counsel related to such proceeding, as
incurred. In any such proceeding, any Indemnified Person shall have the right to
retain its own counsel, but the fees and expenses of such counsel shall be at
the expense of such Indemnified Person unless (i) the Indemnifying Person and
the Indemnified Person shall have mutually agreed to the contrary; (ii) the
Indemnifying Person has failed within a reasonable time to retain counsel
reasonably satisfactory to the Indemnified Person; (iii) the Indemnified Person
shall have reasonably concluded that there may be legal defenses available to it
that are different from or in addition to those available to the Indemnifying
Person; or (iv) the named parties in any such proceeding (including any
impleaded parties) include both the Indemnifying Person and the Indemnified
Person and representation of both parties by the same counsel would be
inappropriate due to actual or potential differing interests between them. It is
understood and agreed that the Indemnifying Person shall not, in connection with
any proceeding or related proceeding in the same jurisdiction, be liable for the
reasonable fees and expenses of more than one separate firm (in addition to any
local counsel) for all Indemnified Persons, and that all such fees and expenses
shall be reimbursed as they are incurred. Any such separate firm (x) for any
Initial Purchaser or the Market-Maker, its affiliates, directors and officers
and any control Persons of such Initial Purchaser or the Market-Maker shall be
designated in writing by JPMorgan, (y) for any Holder, its affiliates, directors
and officers and any control Persons of such Holder shall be designated in
writing by the Majority Holders and (z) in all other cases shall be designated
in writing by the Company. The Indemnifying Person shall not be liable for
22
any settlement of any proceeding effected without its written consent, but if
settled with such consent or if there be a final judgment for the plaintiff, the
Indemnifying Person agrees to indemnify each Indemnified Person from and against
any loss or liability by reason of such settlement or judgment. Notwithstanding
the foregoing sentence, if at any time an Indemnified Person shall have
requested in writing that an Indemnifying Person reimburse the Indemnified
Person for fees and expenses of counsel as contemplated by this paragraph, the
Indemnifying Person shall be liable for any settlement of any proceeding
effected without its written consent if (i) such settlement is entered into more
than 30 days after receipt by the Indemnifying Person of such request and (ii)
the Indemnifying Person shall not have reimbursed the Indemnified Person in
accordance with such request prior to the date of such settlement, except for
amounts as to which a bona fide dispute exists. No Indemnifying Person shall,
without the written consent of the Indemnified Person, effect any settlement of
any pending or threatened proceeding in respect of which any Indemnified Person
is or could have been a party and indemnification could have been sought
hereunder by such Indemnified Person, unless such settlement (A) includes an
unconditional release of such Indemnified Person, in form and substance
reasonably satisfactory to such Indemnified Person, from all liability on claims
that are the subject matter of such proceeding and (B) does not include any
statement as to or any admission of fault, culpability or a failure to act by or
on behalf of any Indemnified Person.
(d) If the indemnification provided for in paragraphs (a), (b) and (c)
above is unavailable to an Indemnified Person or insufficient in respect of any
losses, claims, damages or liabilities referred to therein, then each
Indemnifying Person under such paragraph, in lieu of indemnifying such
Indemnified Person thereunder, shall contribute to the amount paid or payable by
such Indemnified Person as a result of such losses, claims, damages or
liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company and the Guarantors from the offering of the
Securities and the Exchange Securities, on the one hand, and by the Holders from
receiving Securities or Exchange Securities registered under the Securities Act
or the Market-Maker, on the other hand, or (ii) if the allocation provided by
clause (i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
but also the relative fault of the Company and the Guarantors on the one hand
and the Holders or by the Market-Maker on the other in connection with the
statements or omissions that resulted in such losses, claims, damages or
liabilities, as well as any other relevant equitable considerations. The
relative fault of the Company and the Guarantors on the one hand and the Holders
or the Market-Maker on the other shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company and the Guarantors or by the Holders or the
Market-Maker Information, as applicable, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
(e) The Company, the Guarantors, the Holders and the Market-Maker agree
that it would not be just and equitable if contribution pursuant to this Section
6 were
23
determined by pro rata allocation (even if the Holders were treated as one
entity for such purpose) or by any other method of allocation that does not take
account of the equitable considerations referred to in paragraph (e) above. The
amount paid or payable by an Indemnified Person as a result of the losses,
claims, damages and liabilities referred to in paragraph (e) above shall be
deemed to include, subject to the limitations set forth above, any legal or
other expenses incurred by such Indemnified Person in connection with any such
action or claim. Notwithstanding the provisions of this Section 6, in no event
shall a Holder or the Market-Maker be required to contribute any amount in
excess of the amount by which the total price at which the Securities or
Exchange Securities sold by such Holder or the Securities sold by the
Market-Maker exceeds the amount of any damages that such Holder or the
Market-Maker, as the case may be, has otherwise been required to pay by reason
of such untrue or alleged untrue statement or omission or alleged omission. No
Person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation.
(f) The remedies provided for in this Section 6 are not exclusive and
shall not limit any rights or remedies that may otherwise be available to any
Indemnified Person at law or in equity.
(g) The indemnity and contribution provisions contained in this Section
6 shall remain operative and in full force and effect regardless of (i) any
termination of this Agreement, (ii) any investigation made by or on behalf of
the Initial Purchasers, the Market-Maker or any Holder, their respective
affiliates or any Person controlling any Initial Purchaser, the Market-Maker or
any Holder, or by or on behalf of the Company or the Guarantors, their
respective affiliates or the officers or directors of or any Person controlling
the Company or the Guarantors, (iii) acceptance of any of the Exchange
Securities and (iv) any sale of Registrable Securities pursuant to a Shelf
Registration Statement or the Market-Making Registration Statement.
7. General.
(a) No Inconsistent Agreements. The Company and the Guarantors
represent, warrant and agree that (i) the rights granted to the Holders or the
Market-Maker hereunder do not in any way conflict with and are not inconsistent
with the rights granted to the holders of any other outstanding securities
issued or guaranteed by the Company or any Guarantor under any other agreement
and (ii) neither the Company nor any Guarantor has entered into, or on or after
the date of this Agreement will enter into, any agreement that is inconsistent
with the rights granted to the Holders of Registrable Securities or the
Market-Maker in this Agreement or otherwise conflicts with the provisions
hereof.
(b) Amendments and Waivers. The provisions of this Agreement, including
the provisions of this sentence, may not be amended, modified or supplemented,
and waivers or consents to departures from the provisions hereof may not be
given unless the Company and the Guarantors have obtained the written consent of
Holders of at least a
24
majority in aggregate principal amount of the outstanding Registrable Securities
affected by such amendment, modification, supplement, waiver or consent, and
with respect to the provisions of Section 5, the written consent of the
Market-Maker; provided that no amendment, modification, supplement, waiver or
consent to any departure from the provisions of Section 6 hereof shall be
effective as against any Holder of Registrable Securities or the Market-Maker
unless consented to in writing by such Holder or the Market-Maker, as
applicable. Any amendments, modifications, supplements, waivers or consents
pursuant to this Section 7(b) shall be by a writing executed by each of the
parties hereto.
(c) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, registered
first-class mail, telex, telecopier, or any courier guaranteeing overnight
delivery (i) if to a Holder, at the most current address given by such Holder to
the Company by means of a notice given in accordance with the provisions of this
Section 7(c), which address initially is, with respect to the Initial
Purchasers, the address set forth in the Purchase Agreement, and with copies to
Xxxxxx X. Xxxxxxx, Esq., X.X. Xxxxxx Securities Inc., 000 Xxxx Xxxxxx (Xxxxxx
Xxxxx), Xxx Xxxx, Xxx Xxxx 00000, Telecopy No.: (000) 000-0000, Confirm No.:
(000) 000-0000 and Xxxxxx X. Xxxxxxxx, Esq., Xxxxxxx Xxxxxxx & Xxxxxxxx LLP, 000
Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Telecopy No.: (000) 000-0000,
Confirm No.: (000) 000-0000; (ii) if to the Company and the Guarantors,
initially at the Company's address set forth in the Purchase Agreement and
thereafter at such other address, notice of which is given in accordance with
the provisions of this Section 7(c) with a copy to ; (iii) if to the
Market-Maker, at its address set forth in the Purchase Agreement, and with
copies to Xxxxxx X. Xxxxxxx, Esq., X.X. Xxxxxx Securities Inc., 000 Xxxx Xxxxxx
(Xxxxxx Xxxxx), Xxx Xxxx, Xxx Xxxx 00000, Telecopy No.: (000) 000-0000, Confirm
No.: (000) 000-0000 and Xxxxxx X. Xxxxxxxx, Esq., Xxxxxxx Xxxxxxx & Xxxxxxxx
LLP, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Telecopy No.: (212)
455-2502, Confirm No.: (000) 000-0000; and (iv) to such other persons at their
respective addresses as provided in the Purchase Agreement and thereafter at
such other address, notice of which is given in accordance with the provisions
of this Section 7(c). All such notices and communications shall be deemed to
have been duly given: at the time delivered by hand, if personally delivered;
five Business Days after being deposited in the mail, postage prepaid, if
mailed; when answered back, if telexed; when receipt is acknowledged, if
telecopied; and on the next Business Day if timely delivered to an air courier
guaranteeing overnight delivery. Copies of all such notices, demands or other
communications shall be concurrently delivered by the Person giving the same to
the Trustee, at the address specified in the Indenture.
(d) Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the successors, assigns and transferees of each of the
parties, including, without limitation and without the need for an express
assignment, subsequent Holders; provided that nothing herein shall be deemed to
permit any assignment, transfer or other disposition of Registrable Securities
in violation of the terms of the Purchase Agreement or the Indenture. If any
transferee of any Holder shall acquire Registrable Securities in any manner,
whether by operation of law or otherwise, such Registrable Securities shall
25
be held subject to all the terms of this Agreement, and by taking and holding
such Registrable Securities such Person shall be conclusively deemed to have
agreed to be bound by and to perform all of the terms and provisions of this
Agreement and such Person shall be entitled to receive the benefits hereof. The
Initial Purchasers (in their capacity as Initial Purchasers) shall have no
liability or obligation to the Company or the Guarantors with respect to any
failure by a Holder to comply with, or any breach by any Holder of, any of the
obligations of such Holder under this Agreement.
(e) Third Party Beneficiaries. Each Holder shall be a third party
beneficiary to the agreements made hereunder between the Company and the
Guarantors, on the one hand, and the Initial Purchasers and the Market-Maker, on
the other hand, and shall have the right to enforce such agreements directly to
the extent it deems such enforcement necessary or advisable to protect its
rights or the rights of other Holders hereunder.
(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, are not a part of this Agreement 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.
(i) Miscellaneous. This Agreement contains the entire agreement between
the parties relating to the subject matter hereof and supersedes all oral
statements and prior writings with respect thereto. If any term, provision,
covenant or restriction contained in this Agreement is held by a court of
competent jurisdiction to be invalid, void or unenforceable or against public
policy, the remainder of the terms, provisions, covenants and restrictions
contained herein shall remain in full force and effect and shall in no way be
affected, impaired or invalidated. The Company, the Guarantors and the Initial
Purchasers shall endeavor in good faith negotiations to replace the invalid,
void or unenforceable provisions with valid provisions the economic effect of
which comes as close as possible to that of the invalid, void or unenforceable
provisions.
26
[signature pages follow]
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
Portola Packaging, Inc.
By: /s/ Xxxx X. Xxxxx
------------------------------
Name: Xxxx X. Xxxxx
Title: Chief Executive Officer
Portola Allied Tool, Inc.
By: /s/ Xxxx X. Xxxxx
------------------------------
Name: Xxxx X. Xxxxx
Title: Chief Executive Officer
Portola Limited
Executed and delivered as a deed
(on the date first appearing above)
by Portola Limited acting by
/s/ Xxxxxxx Xxxxxxxx , a director
----------------------
Name: Xxxxxxx Xxxxxxxx
/s/ Xxxx Xxxxxxxxxxx , a director
----------------------
Name: Xxxx Xxxxxxxxxxx
Portola Packaging, Inc. Mexico,
S.A. de C.V.
By: /s/ Xxxx X. Xxxxx
------------------------------
Name: Xxxx X. Xxxxx
Title: Chairman
Portola Packaging Canada Ltd.
By: /s/ Xxxxxx X. Xxxx
------------------------------
Name: Xxxxxx X. Xxxx
Title: Chief Financial Officer
Portola Packaging Limited
Executed and delivered as a deed
(on the date first appearing above)
by Portola Packaging Limited
acting by
/s/ Xxxx Xxxxxxxxxxx , a director
-----------------------
Name: Xxxx Xxxxxxxxxxx
/s/ Xxxxxx Xxxx , a director
-----------------------
Name: Xxxxxx Xxxx
Tech Industries, Inc.
By: /s/ Xxxxxx X. Xxxx
------------------------------
Name: Xxxxxx X. Xxxx
Title: Chief Financial Officer
Confirmed and accepted as of the date first above written:
X.X. XXXXXX SECURITIES INC.
For itself and on behalf of the
several Initial Purchasers
By /s/ Xxxx Xxxxx
----------------------------------
Authorized Signatory
SCHEDULE 1
GUARANTORS
----------
NAME JURISDICTION OF INCORPORATION
Portola Allied Tool, Inc. Delaware
Portola Limited England and Wales
Portola Packaging, Inc. Mexico, S.A. de C.V. Mexico
Portola Packaging Canada Ltd. Yukon Territory, Canada
Portola Packaging Limited England and Wales
Tech Industries, Inc. Rhode Island
SCHEDULE 2
INITIAL PURCHASERS
------------------
X.X. Xxxxxx Securities Inc.
UBS Securities LLC
