EXECUTION COPY
REGISTRATION RIGHTS AGREEMENT
DATED AS OF FEBRUARY 13, 2004
BY AND AMONG
ORMAT FUNDING CORP.
XXXXX POWER PARTNERS
STEAMBOAT GEOTHERMAL LLC
STEAMBOAT DEVELOPMENT CORP.
ORMAMMOTH INC.
ORNI 1 LLC
ORNI 2 LLC
ORNI 7 LLC
AND
XXXXXX BROTHERS INC.
This Registration Rights Agreement (this "AGREEMENT") is dated as of
February 13, 2004, by and among Ormat Funding Corp., a Delaware corporation (the
"COMPANY"), the subsidiaries of the Company listed on Schedule A attached hereto
(the "GUARANTORS"), and Xxxxxx Brothers Inc. (the "INITIAL PURCHASER"). The
Initial Purchaser has agreed to purchase the Company's 8 1/4% Senior Secured
Notes due 2020 (the "NOTES") pursuant to the Purchase Agreement (as defined
below).
This Agreement is made pursuant to the Purchase Agreement, dated
February 6, 2004 (the "PURCHASE AGREEMENT"), by and among the Company, the
Guarantors and the Initial Purchaser. In order to induce the Initial Purchaser
to purchase the Notes, the Company and the Guarantors have agreed to provide the
registration rights set forth in this Agreement. The execution and delivery of
this Agreement is a condition to the obligations of the Initial Purchaser set
forth in Section 3 of the Purchase Agreement. Capitalized terms used herein and
not otherwise defined shall have the meanings assigned to them in the Indenture,
dated the Closing Date (the "INDENTURE"), among the Company, the Guarantors and
Union Bank of California, N.A., as Trustee (the "TRUSTEE"), relating to the
Notes and the Exchange Notes (as defined below).
The parties hereby agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement, the following capitalized terms shall have
the following meanings:
ACT: The U.S. Securities Act of 1933, as amended.
AFFILIATE: As defined in Rule 144 of the Act.
BLACKOUT PERIOD: As defined in Section 5 hereof.
BROKER-DEALER: Any broker or dealer registered under the Exchange Act.
CERTIFICATED SECURITIES: Definitive Notes, as defined in the
Indenture.
CLOSING DATE: The date of this Agreement.
COMMISSION: The United States Securities and Exchange Commission.
CONSUMMATE: An Exchange Offer shall be deemed "Consummated" for
purposes of this Agreement upon the occurrence of (a) the filing and
effectiveness under the Act of the Exchange Offer Registration Statement
relating to the Exchange Notes to be issued in the Exchange Offer, (b) the
maintenance of such Exchange Offer Registration Statement continuously effective
and the keeping of the Exchange Offer open for a period not less than the
1
period required pursuant to Section 3(b) hereof and (c) the delivery by the
Company to the Registrar under the Indenture of Exchange Notes in the same
aggregate principal amount as the aggregate principal amount of Notes tendered
by Holders thereof pursuant to the Exchange Offer.
CONSUMMATION DEADLINE: As defined in Section 3(b) hereof.
EFFECTIVENESS DEADLINE: As defined in Section 4(a) hereof.
EXCHANGE ACT: The United States Securities Exchange Act of 1934, as
amended.
EXCHANGE NOTES: The Company's 8 1/4 % Senior Secured Notes due 2020,
registered under the Act, to be issued pursuant to the Indenture (a) in the
Exchange Offer or (b) as contemplated by Section 4 hereof.
EXCHANGE OFFER: The exchange and issuance by the Company of a
principal amount of Exchange Notes (which shall be registered pursuant to the
Exchange Offer Registration Statement) equal to the outstanding principal amount
of Notes that are tendered by such Holders in connection with such exchange and
issuance.
EXCHANGE OFFER REGISTRATION STATEMENT: The Registration Statement
relating to the Exchange Offer, including the related Prospectus.
EXEMPT RESALES: The transactions in which the Initial Purchaser
proposes to sell the Notes (i) to certain "qualified institutional buyers," as
such term is defined in Rule 144A under the Act and (ii) pursuant to Regulation
S under the Act.
GUARANTEES: The guarantees of the Notes and Exchange Notes of the
Guarantors under the Indenture, as amended from time to time.
HOLDERS: As defined in Section 2 hereof.
INTEREST PAYMENT DATE: As defined in the Notes and the Exchange Notes.
PERSON: As defined in the Indenture.
PROSPECTUS: The prospectus included in a Registration Statement at the
time such Registration Statement is declared effective, as amended or
supplemented by any prospectus supplement and by all other amendments thereto,
including post-effective amendments, and all material incorporated by reference
into such Prospectus.
RECOMMENCEMENT DATE: As defined in Section 6(e) hereof.
REGISTRATION DEFAULT: As defined in Section 5 hereof.
2
REGISTRATION STATEMENT: Any registration statement of the Company and
the Guarantors relating to (a) an offering of Exchange Notes and related
Guarantees pursuant to an Exchange Offer or (b) the registration for resale of
Transfer Restricted Securities pursuant to the Shelf Registration Statement, in
each case (i) that is filed pursuant to the provisions of this Agreement and
(ii) including the Prospectus included therein, all amendments and supplements
thereto (including post-effective amendments) and all exhibits and material
incorporated by reference therein.
REGULATION S: Regulation S promulgated under the Act.
RULE 144: Rule 144 promulgated under the Act.
SHELF REGISTRATION STATEMENT: As defined in Section 4(a) hereof.
SUSPENSION NOTICE: As defined in Section 6(e) hereof.
TIA: The United States Trust Indenture Act of 1939 (15 U.S.C. Section
77aaa-77bbbb) as in effect on the date of the Indenture.
TRANSFER RESTRICTED SECURITIES: (a) Each Note, and the related
Guarantees, until the earliest to occur of (i) the date on which such Note has
been exchanged by a Person other than a Broker-Dealer for an Exchange Note in
the Exchange Offer and is entitled to be resold to the public by such Person
without complying with the prospectus delivery requirements of the Act, (ii) the
date on which such Note has been effectively registered under the Act and
disposed of in accordance with the Shelf Registration Statement, or (iii) the
date on which such Note is eligible to be distributed to the public pursuant to
Rule 144(k) under the Act, and (b) each Exchange Note and the related Guarantees
acquired by a Broker-Dealer in the Exchange Offer of a Note for such Exchange
Note, until the date on which such Exchange Note is sold to a purchaser who
receives from such Broker-Dealer on or prior to the date of such sale a copy of
the Prospectus contained in the Exchange Offer Registration Statement.
SECTION 2. HOLDERS
A Person is deemed to be a holder of Transfer Restricted Securities
(each, a "HOLDER") whenever such Person owns Transfer Restricted Securities.
SECTION 3. REGISTERED EXCHANGE OFFER
(a) Unless the Exchange Offer shall not be permitted by applicable
federal law (after the procedures set forth in Section 6(a)(i) below have been
complied with), the Company and the Guarantors shall (i) cause the Exchange
Offer Registration Statement to be filed with the Commission as soon as
practicable after the Closing Date, (ii) use their commercially reasonable
efforts to cause such Exchange Offer Registration Statement to become
3
effective as soon as practicable after filing, (iii) in connection with the
foregoing, (A) file all pre-effective amendments to such Exchange Offer
Registration Statement as may be necessary in order to cause it to become
effective, (B) file, if applicable, a post-effective amendment to such Exchange
Offer Registration Statement pursuant to Rule 430A under the Act and (C) cause
all necessary filings, if any, in connection with the registration and
qualification of the Exchange Notes to be made under the Blue Sky laws of such
jurisdictions as are necessary to permit Consummation of the Exchange Offer, and
(iv) upon the effectiveness of such Exchange Offer Registration Statement,
commence and Consummate the Exchange Offer. The Exchange Offer shall be on the
appropriate form permitting (I) registration of the Exchange Notes to be offered
in exchange for the Notes that are Transfer Restricted Securities and (II)
resales of Exchange Notes by Broker-Dealers that tendered into the Exchange
Offer Notes that such Broker-Dealer acquired for its own account as a result of
market making activities or other trading activities (other than Notes acquired
directly from the Company or any of its Affiliates) as contemplated by Section
3(c) below.
(b) The Company and the Guarantors shall use their commercially
reasonable efforts to cause the Exchange Offer Registration Statement to be
effective continuously, and shall keep the Exchange Offer open for a period of
not less than the minimum period required under applicable federal and state
securities laws to Consummate the Exchange Offer; provided, however, that in no
event shall such period be less than 20 business days. The Company and the
Guarantors shall cause the Exchange Offer to comply with all applicable federal
and state securities laws. No securities other than the Exchange Notes and
related Guarantees shall be included in the Exchange Offer Registration
Statement. The Company and the Guarantors shall use their commercially
reasonable efforts to cause the Exchange Offer to be Consummated on or prior to
the date that is 330 days after the Closing Date (the "CONSUMMATION DEADLINE").
(c) The Company and the Guarantors shall include a "Plan of
Distribution" section in the Prospectus contained in the Exchange Offer
Registration Statement and indicate therein that any Broker-Dealer who holds
Transfer Restricted Securities that were acquired for the account of such
Broker-Dealer as a result of market-making activities or other trading
activities (other than Notes acquired directly from the Company or any Affiliate
of the Company), may exchange such Transfer Restricted Securities pursuant to
the Exchange Offer. Such "Plan of Distribution" section shall also contain all
other information with respect to such sales by such Broker-Dealers that the
Commission may require in order to permit such sales pursuant thereto, but such
"Plan of Distribution" shall not name any such Broker-Dealer or disclose the
amount of Transfer Restricted Securities held by any such Broker-Dealer, except
to the extent required by the Commission as a result of a change in policy,
rules or regulations after the date of this Agreement.
Because such Broker-Dealer may be deemed to be an "underwriter" within
the meaning of the Act and must, therefore, deliver a prospectus meeting the
requirements of the Act in connection with its initial sale of any Exchange
Notes received by such Broker-Dealer in the Exchange Offer, the Company and the
Guarantors shall permit the use of the Prospectus contained in the Exchange
Offer Registration Statement by such Broker-Dealer to satisfy such
4
prospectus delivery requirement. To the extent necessary to ensure that the
prospectus contained in the Exchange Offer Registration Statement is available
for sales of Exchange Notes by Broker-Dealers, the Company and the Guarantors
agree to use their commercially reasonable efforts to keep the Exchange Offer
Registration Statement continuously effective, supplemented, amended and current
as required by and subject to the provisions of Section 6(a) and (c) hereof and
in conformity with the requirements of this Agreement, the Act and the policies,
rules and regulations of the Commission as announced from time to time, for a
period of 180 days from the date on which the Exchange Offer Registration
Statement is declared effective or such shorter period as will terminate when
all Transfer Restricted Securities covered by such Registration Statement have
been sold pursuant thereto or are no longer outstanding. The Company shall
provide sufficient copies of the latest version of such Prospectus to such
Broker-Dealers, promptly upon request at any time during such one-year period in
order to facilitate resales.
SECTION 4. SHELF REGISTRATION
(a) Shelf Registration. If (i) the Company and the Guarantors are not
(A) required to file the Exchange Offer Registration Statement or (B) the
Exchange Offer is not permitted by applicable law or Commission policy (after
the Company and the Guarantors have complied with the procedures set forth in
Section 6(a)(i) hereof) or (ii) if any Holder of Transfer Restricted Securities
shall notify the Company prior to the 20th day following the Consummation of the
Exchange Offer that (x) such Holder was prohibited by applicable law or
Commission policy from participating in the Exchange Offer or (y) such Holder
may not resell the Exchange Notes acquired by it in the Exchange Offer to the
public without delivering a prospectus and the Prospectus contained in the
Exchange Offer Registration Statement is not appropriate or available for such
resales by such Holder or (z) such Holder is a Broker-Dealer and holds Notes
acquired directly from the Company or any of its Affiliates, then the Company
and the Guarantors shall:
(I) use their commercially reasonable efforts to cause to be filed on
or prior to 45 days after the earlier of (x) the date on which the Company
determines that the Exchange Offer Registration Statement cannot be filed as a
result of clause (a)(i) of this Section and (y) the date on which the Company
receives the notice specified in clause (a)(ii) of this Section (such earlier
date, the "FILING DEADLINE"), a shelf registration statement pursuant to Rule
415 under the Act (which may be an amendment to the Exchange Offer Registration
Statement (the "SHELF REGISTRATION STATEMENT")), relating to all Transfer
Restricted Securities; and
(II) use their commercially reasonable efforts to cause such Shelf
Registration Statement to become effective as soon as practicable after filing,
but in no event later than on or prior to the later of (A) 330 days after the
Closing Date or (B) 90 days after the Filing Deadline for the Shelf Registration
Statement (such later date, the "EFFECTIVENESS DEADLINE").
If, after the Company and the Guarantors have filed an Exchange Offer
Registration Statement that satisfies the requirements of Section 3(a) above,
the Company and the Guarantors are required to file and make effective a Shelf
Registration Statement solely
5
because the Exchange Offer is not permitted under applicable federal law (i.e.,
clause (a)(i) of this Section), then the filing of the Exchange Offer
Registration Statement shall be deemed to satisfy the requirements of clause (I)
above; provided that, in such event, the Company and the Guarantors shall remain
obligated to meet the Effectiveness Deadline set forth in clause (II) above.
To the extent necessary to ensure that the Shelf Registration
Statement is available for sales of Transfer Restricted Securities by the
Holders thereof entitled to the benefit of this Section 4(a) and the other
securities required to be registered therein pursuant to Section 6(b)(ii)
hereof, the Company and the Guarantors shall use their commercially reasonable
efforts to keep any Shelf Registration Statement required by this Section 4(a)
continuously effective, supplemented, amended and current as required by and
subject to the provisions of Sections 6(b) and (c) hereof and in conformity with
the requirements of this Agreement, the Act and the policies, rules and
regulations of the Commission as announced from time to time, for a period of at
least two years (as extended pursuant to Section 6(c)(i) hereof) following the
Closing Date, or such shorter period as will terminate when all Transfer
Restricted Securities covered by such Shelf Registration Statement have been
sold pursuant thereto or are no longer outstanding.
(b) Provision by Holders of Certain Information in Connection with the
Shelf Registration Statement. No Holder of Transfer Restricted Securities may
include any of its Transfer Restricted Securities in any Shelf Registration
Statement pursuant to this Agreement unless and until such Holder furnishes to
the Company in writing, within 20 days after receipt of a request therefor, such
information as the Company may reasonably request in connection with any Shelf
Registration Statement or Prospectus or preliminary Prospectus included therein,
including, but not limited to, the information specified in Item 507 or 508 of
Regulation S-K, as applicable, of the Act for use in connection with any Shelf
Registration Statement or Prospectus or preliminary Prospectus included therein.
No Holder of Transfer Restricted Securities shall be entitled to liquidated
damages pursuant to Section 5 hereof unless and until such Holder shall have
provided all such information. By its acceptance of Transfer Restricted
Securities, each Holder agrees to promptly furnish additional information
required to be disclosed in order to make the information previously furnished
to the Company by such Holder not materially misleading.
SECTION 5. LIQUIDATED DAMAGES
If (a) the Shelf Registration Statement, to the extent required
hereby, has not been declared effective by the Commission on or prior to the
Effectiveness Deadline, (b) the Exchange Offer has not been Consummated on or
prior to the Consummation Deadline or (c) any Registration Statement required by
this Agreement is filed and declared effective but shall thereafter cease to be
effective or fail to be usable for its intended purpose without being succeeded
within two business days by a post-effective amendment to such Registration
Statement that cures such failure and that is itself declared effective within
five business days of filing such post-effective amendment to such Registration
Statement, except in the case of this clause (c) under the circumstances set
forth in the following paragraph (each such event referred
6
to in clauses (a) through (c), a "REGISTRATION DEFAULT"); then the Company and
the Guarantors hereby jointly and severally agree to pay to each Holder of Notes
affected thereby, liquidated damages with respect to the first 90-day period
immediately following the occurrence of the first Registration Default in an
amount equal to $.05 per week per $1,000 principal amount of Notes. The amount
of the Liquidated Damages will increase by an additional $.05 per week per
$1,000 principal amount of Notes with respect to each subsequent 90-day period
until all Registration Defaults have been cured, up to a maximum amount of
Liquidated Damages for all Registration Defaults of $.50 per week per $1,000
principal amount of Notes provided that the Company and the Guarantors shall in
no event be required to pay Liquidated Damages for more than one Registration
Default at any given time. Notwithstanding anything to the contrary set forth
herein, (i) upon the effectiveness of the Shelf Registration Statement, in the
case of (a) above, (ii) upon Consummation of the Exchange Offer, in the case of
(b) above, or (iii) upon the filing of a post-effective amendment to the
Registration Statement or an additional Registration Statement that causes the
Exchange Offer Registration Statement (and/or, if applicable, the Shelf
Registration Statement) to again be declared effective or made usable, in the
case of (c) above, the liquidated damages payable with respect to the Transfer
Restricted Securities as a result of such clause (a), (b) or (c), as applicable,
shall cease to accrue, but all accrued and unpaid liquidated damages shall
continue to be payable.
A Registration Default referred to in clause (c) above shall be deemed
not to have occurred and be continuing in respect of a Registration Statement or
the related Prospectus if (A) such period of time during which any Registration
Statement is not effective or any such Registration Statement or the related
Prospectus is not useable ( the "BLACKOUT PERIOD") occurred solely as a result
of (x) the filing of a post-effective amendment to such Registration Statement
to incorporate annual audited financial information with respect to the Company
and the Guarantors where such post-effective amendment is not yet effective and
needs to be declared effective to permit Holders to use the related Prospectus
or (y) the occurrence of other material events with respect to the Company and
the Guarantors that would need to be described in such Registration Statement or
the related Prospectus and (B) in the case of clause (y), the Company and the
Guarantors are proceeding promptly and in good faith to amend or supplement
(including by way of filing documents under the Exchange Act which are
incorporated by reference into the Registration Statement) such Registration
Statement and the related Prospectus to describe such events; provided, however,
that in the event a Blackout Period occurs for a continuous period in excess of
30 days, a Registration Default shall be deemed to have occurred on the 31st day
of such Blackout Period and liquidated damages shall be payable in accordance
with the above paragraph from the day such Registration Default occurs until
such Registration Default is cured or until the Company and the Guarantors are
no longer required pursuant to this Agreement to keep such Registration
Statement effective or such Registration Statement or the related Prospectus
usable; provided, further, that in no event shall the total of all Blackout
Periods exceed 60 days in the aggregate for any 12-month period.
All accrued liquidated damages shall be paid to the Holders entitled
thereto, in the manner provided for the payment of interest in the Indenture, on
each Interest Payment Date, as more fully set forth in the Indenture, the Notes
and the Exchange Notes. Notwithstanding the
7
fact that any securities for which liquidated damages are due cease to be
Transfer Restricted Securities, all obligations of the Company and the
Guarantors to pay liquidated damages with respect to securities shall survive
until (i) an Exchange Offer has been consummated or (ii) a Shelf Registration
Statement has become effective and Holders are permitted to sell Notes
thereunder in such manner and for such periods as are set forth in Section 4
hereof.
SECTION 6. REGISTRATION PROCEDURES
(a) Exchange Offer Registration Statement. In connection with the
Exchange Offer, the Company and the Guarantors shall (i) comply with all
applicable provisions of Section 6(c) below, (ii) use their commercially
reasonable efforts to effect such exchange and to permit the resale of Exchange
Notes by any Broker-Dealer that tendered Notes in the Exchange Offer that such
Broker-Dealer acquired for its own account as a result of its market making
activities or other trading activities (other than Notes acquired directly from
the Company or any of its Affiliates) being sold in accordance with the intended
method or methods of distribution thereof, and (iii) comply with all of the
following provisions:
(A) If, following the date hereof there has been announced a change in
Commission policy with respect to exchange offers such as the Exchange
Offer, that in the reasonable opinion of counsel to the Company raises a
question as to whether the Exchange Offer is permitted by applicable
federal law, the Company and the Guarantors hereby agree to seek a
no-action letter or other favorable decision from the Commission allowing
the Company and the Guarantors to Consummate an Exchange Offer for such
Transfer Restricted Securities. The Company and the Guarantors hereby agree
to pursue the issuance of such a decision to the Commission staff level,
but shall not be required to take commercially unreasonable action to
effect a change of Commission policy. Notwithstanding the foregoing, the
Company and the Guarantors hereby agree to take all such other actions as
may be requested by the Commission or otherwise required in connection with
the issuance of such decision, including without limitation (I)
participating in telephonic conferences with the Commission staff, (II)
delivering to the Commission staff an analysis prepared by counsel to the
Company setting forth the legal bases, if any, upon which such counsel has
concluded that such an Exchange Offer should be permitted and (III)
diligently pursuing a resolution (which need not be favorable) by the
Commission staff.
(B) As a condition to its participation in the Exchange Offer, each
Holder of Transfer Restricted Securities (including, without limitation,
any Holder who is a Broker-Dealer) shall furnish, upon the request of the
Company, prior to the Consummation of the Exchange Offer, a written
representation to the Company and the Guarantors (which may be contained in
the letter of transmittal contemplated by the Exchange Offer Registration
Statement) to the effect that (I) it is not an Affiliate of the Company,
(II) it is not engaged in, and does not intend to engage in, and has no
arrangement or understanding with any person to participate in, a
distribution of the Exchange Notes to be issued in the Exchange Offer,
(III) it is acquiring the Exchange Notes in its ordinary course of business
and
8
(IV) if such Holder is a Broker-Dealer, that it will receive Exchange Notes
for its own account in exchange for Notes that were acquired as a result of
market-making activities or other trading activities and that it will
deliver a Prospectus in connection with any resale of such Exchange Notes.
Each Holder shall be required to make such other representations as may be
reasonably necessary under applicable Commission rules, regulations or
interpretations to render the use of Form S-4 or another appropriate form
under the Act available and will be required to agree to comply with their
agreements and covenants set forth in this Agreement. Each Holder using the
Exchange Offer to participate in a distribution of the Exchange Notes will
be required to acknowledge and agree that, if the resales are of Exchange
Notes obtained by such Holder in exchange for Notes acquired directly from
the Company or an Affiliate thereof, it (1) could not, under Commission
policy as in effect on the date of this Agreement, rely on the position of
the Commission enunciated in Xxxxxx Xxxxxxx and Co., Inc. (available June
5, 1991) and Exxon Capital Holdings Corporation (available May 13, 1988),
as interpreted in the Commission's letter to Shearman & Sterling dated July
2, 1993, and similar no-action letters (including, if applicable, any
no-action letter obtained pursuant to clause (A) above), and (2) must
comply with the registration and prospectus delivery requirements of the
Act in connection with a secondary resale transaction and that such a
secondary resale transaction must be covered by an effective Registration
Statement containing the selling security holder information required by
Item 507 or 508, as applicable, of Regulation S-K.
(C) Prior to effectiveness of the Exchange Offer Registration
Statement, the Company and the Guarantors shall provide a supplemental
letter to the Commission (I) stating that the Company and the Guarantors
are registering the Exchange Offer in reliance on the position of the
Commission enunciated in Exxon Capital Holdings Corporation (available May
13, 1988), Xxxxxx Xxxxxxx and Co., Inc. (available June 5, 1991) as
interpreted in the Commission's letter to Shearman & Sterling dated July 2,
1993, and, if applicable, any no-action letter obtained pursuant to clause
(A) above, (II) including a representation that neither the Company nor any
Guarantor has entered into any arrangement or understanding with any Person
to distribute the Exchange Notes to be received in the Exchange Offer and
that, to the best of the Company's and each Guarantor's information and
belief, each Holder participating in the Exchange Offer is acquiring the
Exchange Notes in its ordinary course of business and has no arrangement or
understanding with any Person to participate in the distribution of the
Exchange Notes received in the Exchange Offer and (III) any other
undertaking or representation required by the Commission as set forth in
any no-action letter obtained pursuant to clause (A) above, if applicable.
(b) Shelf Registration Statement. In connection with the Shelf
Registration Statement, the Company and the Guarantors shall:
(i) comply with all the provisions of Section 6(c) and (d) below
and use their commercially reasonable efforts to effect such registration to
permit the sale of the
9
Transfer Restricted Securities being sold in accordance with the intended method
or methods of distribution thereof (as indicated in the information furnished to
the Company pursuant to Section 4(b) hereof), and pursuant thereto the Company
and the Guarantors will prepare and file with the Commission a Registration
Statement relating to the registration on any appropriate form under the Act,
which form shall be available for the sale of the Transfer Restricted Securities
in accordance with the intended method or methods of distribution thereof within
the time periods and otherwise in accordance with the provisions hereof; and
(ii) issue, upon the request of any Holder or purchaser of Notes
covered by any Shelf Registration Statement contemplated by this Agreement,
Exchange Notes having an aggregate principal amount equal to the aggregate
principal amount of Notes sold pursuant to the Shelf Registration Statement and
surrendered to the Company for cancellation; the Company and the Guarantors
shall register Exchange Notes and the related Guarantees on the Shelf
Registration Statement for this purpose and issue the Exchange Notes to the
purchaser(s) of securities subject to the Shelf Registration Statement in the
names as such purchaser(s) shall designate.
(c) General Provisions. In connection with any Registration Statement
and any related Prospectus required by this Agreement, the Company and the
Guarantors shall:
(i) use their commercially reasonable efforts to keep such
Registration Statement continuously effective and provide all requisite
financial statements for the period specified in Section 3 or 4 hereof, as
applicable. Upon the occurrence of any event that would cause any such
Registration Statement or the Prospectus contained therein (A) to contain an
untrue statement of material fact or omit to state any material fact necessary
to make the statements therein not misleading or (B) not to be effective and
usable for resale of Transfer Restricted Securities during the period required
by this Agreement, the Company and the Guarantors shall file promptly an
appropriate amendment to such Registration Statement curing such defect, and, if
Commission review is required, use their commercially reasonable efforts to
cause such amendment to be declared effective as soon as practicable. If at any
time the Commission shall issue any stop order suspending the effectiveness of
any Registration Statement, or any state securities commission or other
regulatory authority shall issue an order suspending the qualification or
exemption from qualification of the Transfer Restricted Securities under state
securities or Blue Sky laws, the Company and the Guarantors shall use their
commercially reasonable efforts to obtain the withdrawal or lifting of such
order as soon as practicable;
(ii) use their commercially reasonable efforts to prepare and
file with the Commission such amendments and post-effective amendments to the
applicable Registration Statement as may be necessary to keep such Registration
Statement effective for the applicable period set forth in Section 3 or 4
hereof, as the case may be; cause the Prospectus to be supplemented by any
required Prospectus supplement, and as so supplemented to be filed pursuant to
Rule 424 under the Act, and to comply fully with Rules 424, 430A and 462, as
applicable, under the Act in a timely manner, and comply with the provisions of
the Act with
10
respect to the disposition of all securities covered by such Registration
Statement during the applicable period in accordance with the intended method or
methods of distribution by the sellers thereof set forth in such Registration
Statement or supplement to the Prospectus;
(iii) in connection with any sale of Transfer Restricted
Securities that will result in such securities no longer being Transfer
Restricted Securities, cooperate with the Holders to facilitate the timely
preparation and delivery of certificates representing Transfer Restricted
Securities to be sold and not bearing any restrictive legends; and enable such
Transfer Restricted Securities to be registered in such denominations and such
names as the selling Holders may request at least two business days prior to
such sale of Transfer Restricted Securities;
(iv) use their commercially reasonable efforts to cause the
disposition of the Transfer Restricted Securities covered by the Registration
Statement to be registered with or approved by such other governmental agencies
or authorities as may be necessary to enable the seller or sellers thereof to
consummate the disposition of such Transfer Restricted Securities; provided,
however, that neither the Company nor any Guarantor shall be required to
register or qualify as a foreign corporation where it is not now so qualified or
to take any action that would subject it to the service of process in suits or
to taxation, other than as to matters and transactions relating to the
Registration Statement, in any jurisdiction where it is not now so subject;
(v) provide a CUSIP number for all Transfer Restricted Securities
not later than the effective date of a Registration Statement covering such
Transfer Restricted Securities and provide the Trustee under the Indenture with
certificates for the Transfer Restricted Securities which are in a form eligible
for deposit with The Depository Trust Company;
(vi) otherwise use their commercially reasonable efforts to
comply with all applicable rules and regulations of the Commission, and make
generally available to its security holders with regard to any applicable
Registration Statement, as soon as practicable, a consolidated earnings
statement meeting the requirements of Rule 158 (which need not be audited)
covering a twelve-month period beginning with the first month of the Company's
first fiscal quarter commencing after the effective date of the Registration
Statement (as such term is defined in paragraph (c) of Rule 158 under the Act);
and
(vii) use their commercially reasonable efforts to cause the
Indenture to be qualified under the TIA not later than the effective date of the
first Registration Statement required by this Agreement and, in connection
therewith, cooperate with the Trustee and the Holders to effect such changes to
the Indenture as may be required for such Indenture to be so qualified in
accordance with the terms of the TIA; and execute and use their commercially
reasonable efforts to cause the Trustee to execute, all documents that may be
required to effect such changes and all other forms and documents required to be
filed with the Commission to enable such Indenture to be so qualified in a
timely manner.
11
(d) Additional Provisions Applicable to Shelf Registration Statements
and Certain Exchange Offer Prospectuses. In connection with (i) each Shelf
Registration Statement, and (2) each Exchange Offer Registration Statement if
and to the extent that the Initial Purchaser has notified the Company that it is
a holder of Exchange Notes that are Transfer Restricted Securities (for so long
as such Exchange Notes are Transfer Restricted Securities or for the period
provided in Section 3 hereof, whichever is shorter); the Company and the
Guarantors shall:
(i) advise each Holder promptly and, if requested by such Holder,
confirm such advice in writing, (A) when the Prospectus or any Prospectus
supplement or post-effective amendment has been filed, and, with respect to any
applicable Registration Statement or any post-effective amendment thereto, when
the same has become effective, (B) of any request by the Commission for
amendments to the Registration Statement or amendments or supplements to the
Prospectus or for additional information relating thereto, (C) of the issuance
by the Commission of any stop order suspending the effectiveness of the
Registration Statement under the Act or of the suspension by any state
securities commission of the qualification of the Transfer Restricted Securities
for offering or sale in any jurisdiction, or the initiation of any proceeding
for any of the preceding purposes, (D) of the existence of any fact or the
happening of any event that makes any statement of a material fact made in the
Registration Statement, the Prospectus, any amendment or supplement thereto or
any document incorporated by reference therein untrue, or that requires the
making of any additions to or changes in the Registration Statement in order to
make the statements therein not misleading, or that requires the making of any
additions to or changes in the Prospectus in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading;
(ii) if any fact or event contemplated by Section 6(d)(i)(D)
above shall exist or have occurred, use their commercially reasonable efforts to
prepare a supplement or post-effective amendment to the Registration Statement
or related Prospectus or any document incorporated therein by reference or file
any other required document so that, as thereafter delivered to the purchasers
of Transfer Restricted Securities, the Prospectus will not contain an untrue
statement of a material fact or omit to state any material fact necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading;
(iii) furnish to each Holder in connection with such exchange or
sale, if any (or, in connection with any Exchange Offer Registration Statement,
furnish to counsel for the Initial Purchaser), before filing with the
Commission, copies of any Registration Statement or any Prospectus included
therein (except the Prospectus included in the Exchange Offer Registration
Statement at the time it was declared effective) or any amendments or
supplements to any such Registration Statement or Prospectus (but excluding any
documents incorporated by reference as a result of the Company's or the
Guarantors' periodic reporting requirements under the Exchange Act), which
documents will be subject to the review and comment of such Holders (and
counsel, as the case may be) in connection with such sale, if any, for a period
of at least four business days, and the Company will not file any such
Registration Statement or Prospectus or
12
any amendment or supplement to any such Registration Statement or Prospectus
(excluding all such documents incorporated by reference as a result of the
Company's or the Guarantors' periodic reporting requirements under the Exchange
Act) to which such Holders (or counsel, as the case may be) shall reasonably
object within five business days after the receipt thereof. A Holder shall be
deemed to have reasonably objected to such filing if such Registration
Statement, amendment, Prospectus or supplement, as applicable, as proposed to be
filed, contains an untrue statement of a material fact or omits to state any
material fact necessary to make the statements therein not misleading or fails
to comply with the applicable requirements of the Act;
(iv) prior to the filing of any document that is to be
incorporated by reference into a Registration Statement or Prospectus, provide
copies of such document to each Holder (or, in connection with any Exchange
Offer Registration Statement, furnish to counsel for the Initial Purchaser) in
connection with such exchange or sale, if any, make the Company's and the
Guarantors' representatives available for discussion of such document and other
customary due diligence matters, and include such information in such document
prior to the filing thereof as such Holders (and counsel, as the case may be)
may reasonably request;
(v) make available, at reasonable times, for inspection by a
representative of the Holders of Transfer Restricted Securities who is
reasonably acceptable to the Company in connection with any Shelf Registration
Statement and any attorney or accountant retained by such Holders in connection
with any Shelf Registration Statement or Exchange Offer Registration Statement,
all relevant financial and other records, pertinent corporate documents of the
Company and the Guarantors and cause the Company's and the Guarantors' officers,
directors and employees to supply all information reasonably requested by any
such Holder, attorney or accountant in connection with such Registration
Statement or any post-effective amendment thereto subsequent to the filing
thereof and prior to its effectiveness; provided, however, that the foregoing
inspection and information gathering (A) shall be coordinated on behalf of the
selling Holders, underwriters or any representative thereof by one counsel, who
shall be Milbank, Tweed, Xxxxxx & XxXxxx LLP or such other counsel as may be
chosen by the Holders of a majority in principal amount of Transfer Restricted
Securities, and (B) shall not be available to any such Holder who does not agree
to hold such information in confidence;
(vi) if requested by any Holders (or, in connection with any
Exchange Offer Registration Statement, the Initial Purchaser and its counsel) in
connection with such exchange or sale, use their commercially reasonable efforts
to include promptly in any Registration Statement or Prospectus, pursuant to a
supplement or post-effective amendment if necessary, such information as such
Holders may reasonably request to have included therein, including, without
limitation, information relating to the "Plan of Distribution" of the Transfer
Restricted Securities; and make all required filings of such Prospectus
supplement or post-effective amendment as soon as practicable after the Company
is notified of the matters to be included in such Prospectus supplement or
post-effective amendment;
13
(vii) furnish to each Holder (or, in connection with any Exchange
Offer Registration Statement, counsel for the Initial Purchaser) in connection
with such exchange or sale without charge, at least one copy of the Registration
Statement, as first filed with the Commission, and of each amendment thereto,
and upon request all documents incorporated by reference therein and all
exhibits (including exhibits incorporated therein by reference);
(viii) deliver to each Holder (or, in connection with any
Exchange Offer Registration Statement, the Initial Purchaser and their counsel)
without charge, as many copies of the Prospectus (including each preliminary
prospectus) and any amendment or supplement thereto as such Holder (or, in
connection with any Exchange Offer Registration Statement, the Initial Purchaser
and their counsel) reasonably may request; the Company and the Guarantors hereby
consent to the use (in accordance with law) of the Prospectus and any amendment
or supplement thereto by each selling Holder in connection with the offering and
the sale of the Transfer Restricted Securities covered by the Prospectus or any
amendment or supplement thereto; provided that such use of the Prospectus and
any amendment or supplement thereto and such offering and sale conforms to the
Plan of Distribution set forth in the Prospectus and complies with the terms of
this Agreement and all applicable laws and regulations thereunder;
(ix) upon the request of any Holder in connection with any Shelf
Registration Statement, enter into such customary agreements (including an
underwriting agreement) and make such customary representations and warranties
and take all such other customary actions in connection therewith in order to
expedite or facilitate the disposition of the Transfer Restricted Securities
pursuant to any applicable Registration Statement contemplated by this Agreement
as may be reasonably requested by any Holder in connection with any sale or
resale pursuant to any applicable Registration Statement. In such connection,
the Company and the Guarantors shall have no obligation to enter into an
underwriting agreement or permit an underwritten offering unless a request
therefore shall have been received from Holders of not less than 33% of the
aggregate principal amount of Transfer Restricted Securities then outstanding;
and whether or not an underwriting agreement is entered into and whether or not
the registration is an underwritten registration, the Company and the Guarantors
shall:
(A) upon request of any Holder in connection with any Shelf
Registration Statement, furnish (or in the case of paragraphs (2) and (3),
use their commercially reasonable efforts to cause to be furnished) to each
Holder, upon the effectiveness of the Shelf Registration Statement:
(1) a certificate, dated such date, signed on behalf of the Company
and each Guarantor by (x) two senior officers and (y) a principal financial
or accounting officer of the Company and such Guarantor, confirming, as of
the date thereof, the matters set forth in Section 8(b) of the Purchase
Agreement and such other similar matters as such Holders may reasonably
request;
(2) an opinion, dated the date of Consummation of the Exchange Offer
or the date of effectiveness of the Shelf Registration Statement, as the
case may be, of counsel for the Company and the Guarantors covering such
matters as are covered by the opinion
14
set forth in Section 8(a)(i) of the Purchase Agreement and such other
matters as such Holder may reasonably request, and in any event including a
representation to the effect that such counsel has participated in
conferences with officers and other representatives of the Company and the
Guarantors, representatives of the independent public accountants for the
Company and the Guarantors and has considered the matters required to be
stated therein and the statements contained therein, although such counsel
has not independently verified the accuracy, completeness or fairness of
such statements; and that such counsel advises that, on the basis of the
foregoing, no facts came to such counsel's attention that caused such
counsel to believe that the applicable Registration Statement, at the time
such Registration Statement or any post-effective amendment thereto became
effective and, in the case of the Exchange Offer Registration Statement, as
of the date of Consummation of the Exchange Offer, contained an untrue
statement of a material fact or omitted to state a material fact required
to be stated therein or necessary to make the statements therein not
misleading, or that the Prospectus contained in such Registration Statement
as of its date and, in the case of the opinion dated the date of
Consummation of the Exchange Offer, as of the date of Consummation,
contained an untrue statement of a material fact or omitted 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.
Without limiting the foregoing, such counsel may state further that such
counsel assumes no responsibility for, and has not independently verified,
the accuracy, completeness or fairness of the financial statements, notes
and schedules and other financial data included in any Registration
Statement contemplated by this Agreement or the related Prospectus; and
(3) customary comfort letters, dated as of the date of effectiveness
of the Shelf Registration Statement, from the Company's independent
accountants and any other independent accountants that have rendered
opinions with respect to financial statements included in, or incorporated
by reference in, such Shelf Registration Statement, in each case, in the
customary form and covering matters of the type customarily covered in
comfort letters to underwriters in connection with underwritten offerings,
and affirming the matters set forth in the comfort letters delivered
pursuant to Section 8(d) of the Purchase Agreement; and
(B) deliver such other documents and certificates as may be reasonably
requested by the selling Holders to evidence compliance with the matters
covered in clause (A) above and with any customary conditions contained in
any agreement entered into by the Company and the Guarantors pursuant to
this clause (ix);
(x) prior to any public offering of Transfer Restricted
Securities, cooperate with the selling Holders and their counsel in connection
with the registration and qualification of the Transfer Restricted Securities
under the securities or Blue Sky laws of such jurisdictions as the selling
Holders may request and do any and all other acts or things reasonably necessary
or advisable to enable the disposition in such jurisdictions of the Transfer
Restricted Securities covered by the applicable Registration Statement;
provided, however, that neither the
15
Company nor any Guarantor shall be required to register or qualify as a foreign
corporation where it is not now so qualified or to take any action that would
subject it to the service of process in suits or to taxation, other than as to
matters and transactions relating to the Registration Statement, in any
jurisdiction where it is not now so subject; and
(xi) provide promptly to each Holder, upon written request, each
document filed with the Commission pursuant to the requirements of Section 13 or
Section 15(d) of the Exchange Act.
(e) Restrictions on Holders. Each Holder's acquisition of a Transfer
Restricted Security constitutes such Holder's agreement that, upon receipt of
the notice referred to in Section 6(d)(i)(C) or any notice from the Company of
the existence of any fact of the kind described in Section 6(d)(i)(D) hereof (in
each case, a "SUSPENSION NOTICE"), such Holder will forthwith discontinue
disposition of Transfer Restricted Securities pursuant to the applicable
Registration Statement until (i) such Holder has received copies of the
supplemented or amended Prospectus contemplated by Section 6(d)(ii) hereof, or
(ii) such Holder is advised in writing by the Company that the use of the
Prospectus may be resumed, and has received copies of any additional or
supplemental filings that are incorporated by reference in the Prospectus (in
each case, the "RECOMMENCEMENT DATE"). Each Holder receiving a Suspension Notice
shall be required to either (I) destroy any Prospectuses, other than permanent
file copies, then in such Holder's possession that have been replaced by the
Company with a more recently dated Prospectus or (II) deliver to the Company (at
the Company's expense) all copies, other than permanent file copies, then in
such Holder's possession of the Prospectuses covering such Transfer Restricted
Securities that was current at the time of receipt of the Suspension Notice. The
time period regarding the effectiveness of such Registration Statement set forth
in Section 3 or 4 hereof, as applicable, shall be extended by a number of days
equal to the number of days in the period from and including the date of
delivery of the Suspension Notice to the date of delivery of the Recommencement
Date.
SECTION 7. REGISTRATION EXPENSES
(a) All expenses incident to the Company's and the Guarantors'
performance of or compliance with this Agreement will be borne by the Company,
regardless of whether a Registration Statement becomes effective, including
without limitation: (i) all registration and filing fees and expenses; (ii) all
fees and expenses of compliance with federal securities and state Blue Sky or
securities laws; (iii) all expenses of printing (including certificates for the
Exchange Notes to be issued in the Exchange Offer and printing of Prospectuses),
messenger and delivery services and telephone; (iv) all reasonable fees and
disbursements of counsel for the Company, the Guarantors and one counsel for the
Holders of Transfer Restricted Securities (which shall be Milbank, Tweed, Xxxxxx
& XxXxxx LLP or such other counsel as may be selected by a majority of such
Holders); (v) all application and filing fees in connection with listing the
Exchange Notes on a national securities exchange or automated quotation system
pursuant to the requirements hereof; and (vi) all fees and disbursements of
independent certified public accountants of the
16
Company and the Guarantors (including the expenses of any special audit and
comfort letters required by or incident to such performance).
The Company will, in any event, bear its and the Guarantors' internal
expenses (including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties), the expenses of
any annual audit and the fees and expenses of any Person, including special
experts, retained by the Company or the Guarantors.
(b) In connection with any Registration Statement required by this
Agreement (including, without limitation, the Exchange Offer Registration
Statement and the Shelf Registration Statement), the Company and the Guarantors
will reimburse the Initial Purchaser and the Holders of Transfer Restricted
Securities who are tendering Notes in the Exchange Offer and/or selling or
reselling Notes or Exchange Notes pursuant to the "Plan of Distribution"
contained in the Exchange Offer Registration Statement or the Shelf Registration
Statement, as applicable, for the reasonable fees and disbursements of not more
than one counsel (who shall be Milbank, Tweed, Xxxxxx & XxXxxx LLP unless
another firm shall be chosen by the Holders of a majority in principal amount of
the Transfer Restricted Securities for whose benefit such Registration Statement
is being prepared).
SECTION 8. INDEMNIFICATION
(a) The Company and the Guarantors agree, jointly and severally, to
indemnify and hold harmless each Holder, its directors, officers and each
Person, if any, who controls such Holder (within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act), to the fullest extent lawful from
and against any and all losses, claims, damages, liabilities or judgments
(including without limitation, any reasonable legal or other expenses incurred
in connection with investigating or defending any matter, including any action
that could give rise to any such losses, claims, damages, liabilities or
judgments) caused by any untrue statement or alleged untrue statement of a
material fact contained in any Registration Statement, preliminary prospectus or
Prospectus (or any amendment or supplement thereto) provided by the Company to
any Holder or any prospective purchaser of Exchange Notes or registered Notes,
or caused by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except insofar as such losses, claims, damages, liabilities or
judgments are caused by an untrue statement or omission or alleged untrue
statement or omission that is based upon information relating to any of the
Holders furnished in writing to the Company by any of the Holders; provided,
that with respect to any such untrue statement or omission or alleged untrue
statement or omission in or from any preliminary Prospectus, the indemnity
agreement contained in this paragraph shall not inure to the benefit of any
Holder from whom the Person asserting any such loss, claim, damage, liability or
judgment received Notes or Exchange Notes to the extent that any such loss,
claim damage, liability or judgment of or with respect to such Holder results
from the fact that both (i) a copy of the final Prospectus was not sent or given
to such Person at or prior to the written confirmation of the sale of such Notes
or Exchange Notes to such Person and (ii) the untrue statement or omission or
alleged untrue statement or omission in or from such preliminary Prospectus was
corrected in the
17
final Prospectus unless, in either case, such failure to deliver the final
Prospectus was a result of the non-compliance by the Company or the Guarantors
with the provision of Section 6 hereof.
(b) By its acquisition of Transfer Restricted Securities, each Holder
of Transfer Restricted Securities agrees, severally and not jointly, to
indemnify and hold harmless the Company and the Guarantors, and their respective
directors and officers, and each person, if any, who controls (within the
meaning of Section 15 of the Act or Section 20 of the Exchange Act) the Company
or the Guarantors to the same extent as the foregoing indemnity from the Company
and the Guarantors set forth in Section 8(a) hereof, but only with reference to
information relating to such Holder furnished in writing to the Company by such
Holder expressly for use in any Registration Statement or in any amendment or
supplement thereto. In no event shall any Holder, its directors, officers or any
Person who controls such Holder be liable or responsible for any amount in
excess of the amount by which the total amount received by such Holder with
respect to its sale of Transfer Restricted Securities pursuant to a Registration
Statement exceeds (i) the amount paid by such Holder for such Transfer
Restricted Securities and (ii) the amount of any damages that such Holder, its
directors, officers or any Person who controls such Holder has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission.
(c) In case any action shall be commenced involving any Person in
respect of which indemnity may be sought pursuant to Section 8(a) or (b) hereof
(the "INDEMNIFIED PARTY") the indemnified party shall promptly notify the Person
against whom such indemnity may be sought (the "INDEMNIFYING PERSON") in writing
and the indemnifying party shall assume the defense of such action, including
the employment of counsel reasonably satisfactory to the indemnified party and
the payment of all fees and expenses of such counsel, as incurred (except that
in the case of any action in respect of which indemnity may be sought pursuant
to both Sections 8(a) and (b) hereof, a Holder shall not be required to assume
the defense of such action pursuant to this Section 8(c), but may employ
separate counsel and participate in the defense thereof, but the fees and
expenses of such counsel, except as provided below, shall be at the expense of
the Holder). Any 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 at the expense of the indemnified party
unless (i) the employment of such counsel shall have been specifically
authorized in writing by the indemnifying party, (ii) the indemnifying party
shall have failed to assume the defense of such action or employ counsel
reasonably satisfactory to the indemnified party or (iii) the named parties to
any such action (including any impleaded parties) include both the indemnified
party and the indemnifying party, and the indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party (in which case the indemnifying party shall not have the
right to assume the defense of such action on behalf of the indemnified party).
In any such case, the indemnifying party shall not, in connection with any one
action or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the fees and expenses of more than one separate firm of attorneys (in
addition to any local counsel) for all indemnified parties and all such fees and
expenses shall be reimbursed as
18
they are incurred. Such firm shall be designated in writing by a majority of the
Holders, in the case of the parties indemnified, pursuant to Section 8(a)
hereof, and by the Company and the Guarantors, in the case of parties
indemnified, pursuant to Section 8(b) hereof. The indemnifying party shall
indemnify and hold harmless the indemnified party from and against any and all
losses, claims, damages, liabilities and judgments by reason of any settlement
of any action (A) effected with its written consent or (B) effected without its
written consent if the settlement is entered into more than 20 business days
after the indemnifying party shall have received a request from the indemnified
party for reimbursement for the fees and expenses of counsel (in any case where
such fees and expenses are at the expense of the indemnifying party) and, prior
to the date of such settlement, the indemnifying party shall have failed to
comply with such reimbursement request. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement or
compromise of, or consent to the entry of judgment with respect to, any pending
or threatened action in respect of which the indemnified party is or could have
been a party and indemnity or contribution may be or could have been sought
hereunder by the indemnified party, unless such settlement, compromise or
judgment (I) includes an unconditional release of the indemnified party from all
liability on claims that are or could have been the subject matter of such
action and (II) does not include a statement as to or an admission of fault,
culpability or a failure to act, by or on behalf of the indemnified party.
(d) To the extent that the indemnification provided for in this
Section 8 is unavailable to an indemnified party in respect of any losses,
claims, damages, liabilities or judgments referred to therein, then each
indemnifying party, in lieu of indemnifying such indemnified party shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities or judgments (i) in such proportion
as is appropriate to reflect the relative benefits received by the Company and
the Guarantors on the one hand, and the Holders, on the other hand, from their
initial sale of Transfer Restricted Securities (or in the case of Exchange Notes
that are Transfer Restricted Securities, the sale of the Notes for which such
Exchange Notes were exchanged) or (ii) if the allocation provided by clause
8(d)(i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in such clause
8(d)(i) but also the relative fault of the Company and the Guarantors, on the
one hand, and of the Holder, on the other hand, in connection with the
statements or omissions which resulted in such losses, claims, damages,
liabilities or judgments, as well as any other relevant equitable
considerations. The relative fault of the Company and the Guarantors, on the one
hand, and of the Holder, on the other hand, shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates to
information supplied by the Company or such Guarantor, on the one hand, or by
the Holder, on the other hand, and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The amount paid or payable by a party as a result of the losses,
claims, damages, liabilities and judgments referred to above shall be deemed to
include, subject to the limitations set forth in Section 8(c) hereof, any legal
or other fees or expenses reasonably incurred by such party in connection with
investigating or defending any action or claim.
19
The Company, the Guarantors and, by its acquisition of Transfer
Restricted Securities, each Holder agree that it would not be just and equitable
if contribution pursuant to this Section 8(d) were determined by pro rata
allocation (even if the Holders were treated as one entity for such purpose) or
by any other method of allocation which does not take account of the equitable
considerations referred to in the immediately preceding paragraph. The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages, liabilities or judgments referred to in the immediately preceding
paragraph shall be deemed to include, subject to the limitations set forth
above, any legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any matter, including any action
that could have given rise to such losses, claims, damages, liabilities or
judgments. Notwithstanding the provisions of this Section 8, no Holder, its
directors, its officers or any Person, if any, who controls such Holder shall be
required to contribute, in the aggregate, any amount in excess of the amount by
which the total received by such Holder with respect to the sale of Transfer
Restricted Securities pursuant to a Registration Statement exceeds (i) the
amount paid by such Holder for such Transfer Restricted Securities and (ii) the
amount of any damages which such Holder has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No Person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any Person
who was not guilty of such fraudulent misrepresentation. The Holders'
obligations to contribute pursuant to this Section 8(d) are several in
proportion to the respective principal amount of Transfer Restricted Securities
held by each Holder hereunder and not joint.
SECTION 9. RULE 144A AND RULE 144
The Company and each Guarantor agrees with each Holder, for so long as
any Transfer Restricted Securities remain outstanding and during any period in
which the Company or such Guarantor (a) is not subject to Section 13 or 15(d) of
the Exchange Act, to make available, upon request of any Holder or beneficial
owner of Transfer Restricted Securities in connection with any sale thereof and
any prospective purchaser of such Transfer Restricted Securities designated by
such Holder or beneficial owner, the information required by Rule 144A(d)(4)
under the Act in order to permit resales of such Transfer Restricted Securities
pursuant to Rule 144A, and (b) is subject to Section 13 or 15(d) of the Exchange
Act, to use its commercially reasonable efforts to make all filings required
thereby in a timely manner in order to permit resales of such Transfer
Restricted Securities pursuant to Rule 144.
SECTION 10. FUTURE GUARANTEES
If, prior to the Consummation of the Exchange Offer or prior to the
effectiveness of the Shelf Registration Statement, as the case may be, any
subsidiary of the Company executes a Guarantee in accordance with the terms and
provisions of the Indenture, the Company shall cause such subsidiary to execute
and deliver to the parties hereto a counterpart signature page to this Agreement
and such subsidiary shall be bound by all the provisions of this Agreement as a
"Guarantor."
20
SECTION 11. MISCELLANEOUS
(a) Remedies. The Company and the Guarantors acknowledge and agree
that monetary damages (including the liquidated damages contemplated by Section
5 hereof) would not be adequate compensation for any loss incurred by reason of
a breach by the Company or the Guarantors of the provisions of this Agreement
and the Company and the Guarantors hereby agree to waive the defense in any
action for specific performance that a remedy at law would be adequate; provided
that the liquidated damages contemplated by Section 5 hereof shall be the
exclusive remedy for any such breach of Section 3 or 4 of this Agreement.
(b) No Inconsistent Agreements. The Company and the Guarantors will
not, on or after the date of this Agreement, enter into any agreement with
respect to their respective securities that is inconsistent with the rights
granted to the Holders in this Agreement or otherwise conflicts with the
provisions hereof. The Company and the Guarantors have not previously entered
into any agreement granting any registration rights with respect to their
respective securities to any Person that would require such securities to be
included in any Registration Statement filed hereunder. The rights granted to
the Holders hereunder do not in any way conflict with and are not inconsistent
with the rights granted to the holders of the Company's and the Guarantors'
securities under any agreement in effect on the date hereof.
(c) Amendments and Waivers. The provisions of this Agreement may not
be amended, modified or supplemented, and waivers or consents to or departures
from the provisions hereof may not be given unless (i) in the case of Section 5
hereof and this Section 11 (c)(i), the Company has obtained the written consent
of Holders of all outstanding Transfer Restricted Securities and (ii) in the
case of all other provisions hereof, the Company has obtained the written
consent of Holders of a majority of the outstanding principal amount of Transfer
Restricted Securities (excluding Transfer Restricted Securities held by the
Company or its Affiliates). Notwithstanding the foregoing, a waiver of or
consent to departure from the provisions hereof that relates exclusively to the
rights of Holders whose Transfer Restricted Securities are being tendered
pursuant to the Exchange Offer, and that does not affect directly or indirectly
the rights of other Holders whose Transfer Restricted Securities are not being
tendered pursuant to such Exchange Offer, may be given by the Holders of a
majority of the outstanding principal amount of Transfer Restricted Securities
subject to such Exchange Offer.
(d) Third Party Beneficiary. The Holders shall be third party
beneficiaries to the agreements made hereunder between the Company and the
Guarantors, on the one band, and the Initial Purchaser, on the other hand, and
shall have the right to enforce such agreements directly to the extent they may
deem such enforcement necessary or advisable to protect their rights hereunder.
21
(e) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail
(registered or certified, return receipt requested), telecopier, or air courier
guaranteeing overnight delivery:
(i) if to a Holder, at the address set forth on the records of
the Registrar under the Indenture, with a copy to the Registrar under the
Indenture; and
(ii) if to the Company or any of the Guarantors:
Ormat Funding Corp.
000 Xxxx Xxxxxx
Xxxxxx, Xxxxxx 00000
Attention: President
Facsimile: (000) 000-0000
All such notices and communications shall be deemed to have been duly
given at the time delivered by hand; 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.
(f) Successors and Assigns. This Agreement shall inure to the benefit
of and be binding upon the successors and assigns of each of the parties,
including without limitation and without the need for an express assignment,
subsequent Holders; provided that nothing herein shall be deemed to permit any
assignment, transfer or other disposition of Transfer Restricted Securities in
violation of the terms hereof or of the Purchase Agreement or the Indenture. If
any transferee of any Holder shall acquire Transfer Restricted Securities in any
manner, whether by operation of law or otherwise, such Transfer Restricted
Securities shall be held subject to all of the terms of this Agreement, and by
taking and holding such Transfer Restricted 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, including the restrictions on resale set
forth in this Agreement and, if applicable, the Purchase Agreement, and such
Person shall be entitled to receive the benefits hereof.
(g) 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.
(h) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
22
(i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
(j) Severability. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
(k) Entire Agreement. This Agreement is intended by the parties as a
final expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein
with respect to the registration rights granted with respect to the Transfer
Restricted Securities. This Agreement supersedes all prior agreements and
understandings between the parties with respect to such subject matter.
23
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
Ormat Funding Corp.
By: /s/ Xxxxxxx Xxxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: President and Secretary
Xxxxx Power Partners,
By: ORNI 1 LLC,
a Delaware limited liability company
Its: General Partner
By: ORMAT FUNDING CORP.,
a Delaware corporation
Its: Sole Member and Manager
By: /s/ Xxxxxxx Xxxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: President and Secretary
Steamboat Geothermal LLC,
By: ORNI 7 LLC,
a Delaware limited liability company
Its: General Partner
By: ORMAT FUNDING CORP.,
a Delaware corporation
Its: Sole Member and Manager
By: /s/ Xxxxxxx Xxxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: President and Secretary
24
Steamboat Development Corp.
By: /s/ Xxxxxxx Xxxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: President and Secretary
OrMammoth Inc.
By: /s/ Xxxxxxx Xxxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: President and Secretary
ORNI 1 LLC
By: ORMAT FUNDING CORP.,
a Delaware corporation
Its: Sole Member and Manager
By: /s/ Xxxxxxx Xxxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: President and Secretary
ORNI 2 LLC
By: ORMAT FUNDING CORP.,
a Delaware corporation
Its: Sole Member and Manager
By: /s/ Xxxxxxx Xxxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: President and Secretary
25
ORNI 7 LLC
By: ORMAT FUNDING CORP.,
a Delaware corporation
Its: Sole Member and Manager
By: /s/ Xxxxxxx Xxxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: President and Secretary
26
XXXXXX BROTHERS INC.
By: /s/ Xxxx Xxxxx
---------------------------------
Name: Xxxx Xxxxx
Title: Managing Director
27
SCHEDULE A
Guarantors
Xxxxx Power Partners
Steamboat Geothermal LLC
Steamboat Development Corp.
OrMammoth, Inc.
ORNI 1 LLC
ORNI 2 LLC
ORNI 7 LLC
28
