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REGISTRATION RIGHTS AGREEMENT
Dated as of March 3, 1998
by and among
OUTSOURCING SERVICES GROUP, INC.,
THE GUARANTORS NAMED HEREIN,
BT ALEX. XXXXX INCORPORATED
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10-7/8% SENIOR SUBORDINATED NOTES DUE 2006
This Registration Rights Agreement is dated as of March 3, 1998, by
and among Outsourcing Services Group, Inc., a Delaware corporation (the
"COMPANY"), each of the subsidiaries of the Company listed on the signature
pages hereto as a Guarantor (collectively, the "GUARANTORS" and, together with
the Company, the "ISSUERS") and BT Alex. Xxxxx Incorporated (the "INITIAL
PURCHASER").
This Agreement is made pursuant to the Purchase Agreement, dated
February 26, 1998, among the Company, the Guarantors and the Initial Purchaser
(the "PURCHASE AGREEMENT"). In order to induce the Initial Purchaser to enter
into the Purchase Agreement, the Issuers have agreed to provide the registration
rights provided for in this Agreement to the Initial Purchaser and their
respective direct and indirect transferees and assigns. The execution and
delivery of this Agreement is a condition to the closing of the transactions
contemplated by the Purchase Agreement.
The parties hereby agree as follows:
1. DEFINITIONS
As used in this Agreement, the following terms shall have the
following meanings:
AFFILIATE: With respect to any specified person, "Affiliate" shall
mean a person that directly, or indirectly through one or more intermediaries,
controls or is controlled by, or is under common control with, the persons
specified. For the purposes of this definition, "control," when used with
respect to any person, means the possession, direct or indirect, of the power to
direct or cause the direction of the management and policies of such person,
whether through the ownership of voting securities, by contract or otherwise and
the terms "affiliated," controlling" and "controlled" have meanings correlative
to the foregoing.
AGREEMENT: This Registration Rights Agreement, as the same may be
amended, supplemented or modified from time to time in accordance with the terms
hereof.
BUSINESS DAY: Any day except a Saturday, a Sunday or a day on which
banking institutions in New York, New York generally are required or authorized
by law or other government action to be closed.
COMPANY: As defined in the preamble hereof.
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CONSUMMATE OR CONSUMMATE: When used to qualify the term "Exchange
Offer", shall mean validly and lawfully to issue and deliver the Exchange Notes
pursuant to the Exchange Offer for all Notes validly tendered and not validly
withdrawn pursuant thereto in accordance with the terms of this Agreement.
CONSUMMATION DATE: The date that is 35 days immediately following the
date that the Exchange Registration Statement shall have been declared effective
by the SEC.
EFFECTIVENESS PERIOD: As defined in Section 3(a) hereof.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated by the SEC pursuant thereto.
EXCHANGE DATE: As defined in Section 2(d) hereof.
EXCHANGE NOTES: The 10-7/8% Senior Subordinated Notes due 2006 of the
Company, guaranteed on a senior subordinated unsecured basis by each of the
Guarantors, that are identical to the Notes in all material respects, except
that the provisions regarding restrictions on transfer shall be modified, as
provided in the Indenture (or the indenture, if different from the Indenture
pursuant to which the Exchange Notes are issued), and the issuance thereof
pursuant to the Exchange Offer shall have been registered pursuant to an
effective Registration Statement in compliance with the Securities Act.
EXCHANGE OFFER: An offer to issue, in exchange for any and all of the
Notes, a like aggregate principal amount of Exchange Notes, which offer shall be
made by the Company pursuant to Section 2 hereof.
EXCHANGE REGISTRATION STATEMENT: As defined in Section 2(a) hereof.
FILING DATE: As defined in Section 2(a) hereof.
INDEMNIFIED PERSON: As defined in Section 7(a) hereof.
INDENTURE: The Indenture, dated as of February 26, 1998, among the
Issuers and First Trust National Association, as trustee thereunder, pursuant to
which the Notes are issued, as amended or supplemented from time to time in
accordance with the terms thereof.
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INITIAL PURCHASER: As defined in the preamble hereof.
ISSUE DATE: As defined in Section 2(a) hereof.
ISSUERS: As defined in the preamble hereof.
LIQUIDATED DAMAGES. As defined in Section 4(a) hereof.
NOTES: The 10-7/8% Senior Subordinated Notes due 2006 of the Company,
guaranteed on a senior subordinated unsecured basis by each of the Guarantors,
issued, from time to time, pursuant to the Indenture.
PARTICIPATING BROKER-DEALER: As defined in Section 2(b) hereof.
PRIVATE EXCHANGE: As defined in Section 2(c) hereof.
PRIVATE EXCHANGE NOTES: As defined in Section 2(c) hereof.
PROSPECTUS: The prospectus included in any Registration Statement
(including, without limitation, a prospectus that discloses information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A promulgated pursuant to the Securities
Act), as amended or supplemented by any prospectus supplement, with respect to
the terms of the offering of any portion of the Notes, Exchange Notes or Private
Exchange Notes covered by such Registration Statement, and all other amendments
and supplements to any such prospectus, including post-effective amendments, and
all material incorporated by reference or deemed to be incorporated by
reference, if any, in such prospectus.
REGISTRATION DEFAULT: As defined in Section 4(b) hereof.
REGISTRATION STATEMENT: Any registration statement of the Company
and/or the Guarantors that covers any of the Notes, Exchange Notes or Private
Exchange Notes pursuant to the provisions of this Agreement, including the
Prospectus, amendments and supplements to such registration statement or
Prospectus, including pre- and post-effective amendments, all exhibits thereto,
and all material incorporated by reference or deemed to be incorporated by
reference, if any, in such registration statement.
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RULE 144(k): Rule 144(k) promulgated by the SEC pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
RULE 144A: Rule 144A promulgated by the SEC pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
RULE 158: Rule 158 promulgated by the SEC pursuant to the Securities
Act, as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
RULE 174: Rule 174 promulgated by the SEC pursuant to the Securities
Act, as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
RULE 415: Rule 415 promulgated by the SEC pursuant to the Securities
Act, as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
RULE 424: Rule 424 promulgated by the SEC pursuant to the Securities
Act, as such Rule may be amended from time to time, or any similar rule or
regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
SEC: The Securities and Exchange Commission.
SECURITIES ACT: The Securities Act of 1933, as amended, and the rules
and regulations promulgated by the SEC thereunder.
SHELF BLACKOUT PERIOD: As defined in Section 3(a) hereof.
SHELF FILING EVENT: As defined in Section 3(a) hereof.
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SHELF REGISTRATION: As defined in Section 3(a) hereof.
SHELF REGISTRATION STATEMENT: As defined in Section 3(a) hereof.
SPECIAL COUNSEL: Such special counsel to the holders of Transfer
Restricted Notes as shall be agreed upon by the Issuers and holders of a
majority in aggregate principal amount of Transfer Restricted Notes, the
reasonable expenses of which holders of Transfer Restricted Notes will be
reimbursed by the Issuers pursuant to Section 6 hereof.
GUARANTORS: As defined in the preamble hereof.
TIA: The Trust Indenture Act of 1939, as amended.
TRANSFER RESTRICTED NOTE: Each Note, each Exchange Note as to which
Section 3(a)(ii) hereof is applicable, and each Private Exchange Note, in each
case upon original issuance thereof and at all times subsequent thereto until
the earliest to occur of (i) the date on which any such Note has been exchanged
by a person other than a Participating Broker-Dealer for an Exchange Note (other
than with respect to an Exchange Note as to which Section 3(a)(ii) hereof
applies) pursuant to the Exchange Offer, (ii) with respect to Exchange Notes
received by Participating Broker-Dealers in the Exchange Offer, the earlier of
(x) the date on which such Exchange Note has been sold by such Participating
Broker-Dealer by means of the Prospectus contained in the Exchange Registration
Statement and (y) the date on which the Exchange Registration Statement has been
effective under the Securities Act for a period of six months after the
Consummation Date, (iii) a Shelf Registration Statement covering such Note,
Exchange Note or Private Exchange Note has been declared effective by the SEC
and such Note, Exchange Note or Private Exchange Note, as the case may be, has
been disposed of in accordance with such effective Shelf Registration Statement,
(iv) the date on which such Note, Exchange Note or Private Exchange Note, as the
case may be, is eligible for distribution to the public without volume or manner
of sale restrictions pursuant to Rule 144(k) or (v) the date on which such Note,
Exchange Note or Private Exchange Note, as the case may be, ceases to be
outstanding for purposes of the Indenture or any other indenture under which
such Exchange Note or Private Exchange Note was issued.
TRUSTEE: The trustee under the Indenture.
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UNDERWRITTEN REGISTRATION OR UNDERWRITTEN OFFERING: A registration in
connection with which securities are sold to an underwriter for reoffering to
the public pursuant to an effective Registration Statement.
2. EXCHANGE OFFER
(a) To the extent not prohibited by any applicable law or applicable
interpretation of the staff of the SEC, the Issuers shall (A) prepare and, on or
prior to 120 days (the "FILING DATE") after the date of original issuance of the
Notes (the "ISSUE DATE"), file with the SEC a Registration Statement under the
Securities Act with respect to an offer by the Company to the holders of the
Notes to issue and deliver to such holders, in exchange for Notes, a like
principal amount of Exchange Notes, (B) use their best efforts to cause the
Registration Statement relating to the Exchange Offer to be declared effective
by the SEC under the Securities Act on or prior to 180 days after the Issue
Date, and (C) commence the Exchange Offer and use their best efforts to issue,
on or prior to the Consummation Date, the Exchange Notes. The offer and sale of
the Exchange Notes pursuant to the Exchange Offer shall be registered pursuant
to the Securities Act on an appropriate form (the "EXCHANGE REGISTRATION
STATEMENT") and duly registered or qualified under all applicable state
securities or Blue Sky laws and will comply with all applicable tender offer
rules and regulations under the Exchange Act and state securities or Blue Sky
laws; provided that the Issuers will not be required to qualify to do business
in any State or jurisdiction in which they are not presently qualified to do
business. The Exchange Offer shall not be subject to any condition, other than
that the Exchange Offer does not violate any applicable law or regulation or
interpretation of the staff of the SEC. Upon consummation of the Exchange Offer
in accordance with this Section 2, the Issuers shall have no further
registration obligations other than with respect to (i) Private Exchange Notes,
if required (ii) Exchange Notes held by Participating Broker-Dealers and
(iii) Notes or Exchange Notes as to which Section 3(a)(ii) hereof applies. No
securities shall be included in the Exchange Registration Statement other than
the Exchange Notes.
(b) The Issuers may require each holder of Notes, as a condition to
its participation in the Exchange Offer, to represent to the Issuers and their
counsel in writing (which may be contained in the applicable letter of
transmittal) that at the time of the consummation of the Exchange Offer (i) any
Exchange Notes received by such holder will be acquired in the
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ordinary course of its business, (ii) such holder will have no arrangement or
understanding with any person to participate in the distribution (within the
meaning of the Securities Act) of the Exchange Notes and (iii) such holder is
not an Affiliate of an Issuer, or if it has such an arrangement or understanding
or is an Affiliate of an Issuer, it will comply with the registration and
prospectus delivery requirements of the Securities Act, to the extent
applicable.
If the holder is not a broker-dealer, it will be required to represent
that it is not engaged in, and does not intend to engage in, the distribution of
the Exchange Notes. If the holder is a broker-dealer that 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 (a "Participating
Broker-Dealer"), it will be required to acknowledge that it will deliver a
prospectus in connection with any resale of such Exchange Notes.
(c) If, prior to consummation of the Exchange Offer, the Initial
Purchaser holds any Notes acquired by it and having, or which are reasonably
likely to be determined to have, the status of an unsold allotment in the
initial distribution, or any other holder of Notes is not entitled to
participate in the Exchange Offer other than for failing to tender into the
Exchange Offer, the Issuers, upon the request of the Initial Purchaser or any
such holder, shall, simultaneously with the delivery of the Exchange Notes in
the Exchange Offer, issue and deliver to the Initial Purchaser and any such
holder, in exchange (the "PRIVATE EXCHANGE") for such Notes held by the Initial
Purchaser and any such holder, a like principal amount of debt securities of the
Company, guaranteed by each of the Guarantors on a senior subordinated basis,
that are identical in all material respects to the Exchange Notes other than
transfer restrictions (the "PRIVATE EXCHANGE NOTES") (and which are issued
pursuant to the same indenture as the Exchange Notes). The Private Exchange
Notes shall bear the same CUSIP number as the Exchange Notes.
(d) Unless the Exchange Offer would not be permitted by any
applicable law or interpretation of the staff of the SEC, the Company shall mail
the Exchange Offer Prospectus and appropriate accompanying documents, including
appropriate letters of transmittal, to each holder of Notes providing, in
addition to such other disclosures as are required by applicable law:
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(i) that the Exchange Offer is being made pursuant to this Agreement
and that all Notes validly tendered will be accepted for exchange;
(ii) the date of acceptance for exchange (the "EXCHANGE DATE"), which
date shall in no event be later than the Consummation Date (unless
otherwise required by applicable law);
(iii) that a holder of a Note electing to have a Note exchanged
pursuant to the Exchange Offer will be required to surrender such Note,
together with the enclosed letters of transmittal, to the institution and
at the address (located in the Borough of Manhattan, The City of New York)
specified in the notice prior to the close of business on the Exchange
Date; and
(iv) that holders of Notes that do not tender all such securities
pursuant to the Exchange Offer may no longer have any registration rights
hereunder with respect to Notes not tendered.
Promptly after the Exchange Date, the Company shall:
(i) accept for exchange all Notes or portions thereof validly
tendered and not validly withdrawn pursuant to the Exchange Offer; and
(ii) deliver, or cause to be delivered, to the Trustee for
cancellation all Notes or portions thereof so accepted for exchange by the
Company, and issue, cause the Trustee under the Indenture (or the indenture
pursuant to which the Exchange Notes are issued) to authenticate, and mail
to each holder of Notes, Exchange Notes equal in principal amount to the
principal amount of the Notes surrendered by such holder.
(e) The Issuers and the Initial Purchaser acknowledge that the staff
of the SEC has taken the position that any 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 Notes.
The Issuers and the Initial Purchaser also acknowledge that it is the
SEC staff's position that if the Prospectus contained in the Exchange
Registration Statement includes a plan of distribution containing a statement to
the above effect
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and the means by which Participating Broker-Dealers may resell the Exchange
Notes, without naming the Participating Broker-Dealers or specifying the amount
of Exchange Notes owned by them, such Prospectus may be delivered by
Participating Broker-Dealers to satisfy their prospectus delivery obligations
under the Securities Act in connection with resales of Exchange Notes for their
own accounts, so long as the Prospectus otherwise meets the requirements of the
Securities Act.
In light of the foregoing, if requested by a Participating
Broker-Dealer, the Issuers agree (x) to use their best efforts to keep the
Exchange Registration Statement continuously effective for a period of up to six
months after the Consummation Date or such earlier date as each Participating
Broker-Dealer shall have notified the Company in writing that such Participating
Broker-Dealer has resold all Exchange Notes acquired in the Exchange Offer or
the Issuers' counsel renders an opinion to the effect that the delivery of a
prospectus is no longer required, (y) to comply with the provisions of Section 5
of this Agreement, as they relate to the Exchange Offer and the Exchange
Registration Statement, and (z) to deliver to such Participating Broker-Dealer a
"cold comfort" letter of the independent public accountants of the Issuers and a
legal opinion as to matters reasonably requested by such Participating
Broker-Dealer relating to the Exchange Registration Statement and the related
Prospectus and any amendments or supplements thereto.
(f) The Initial Purchaser shall have no liability to any
Participating Broker-Dealer with respect to any request made pursuant to
Section 2(e).
(g) Interest on each Exchange Note or Private Exchange Note will
accrue (A) from the later of (i) the last interest payment date on which
interest was paid on the Note surrendered in exchange therefor, or (ii) if the
Note is surrendered for exchange on a date in a period which includes the record
date for an interest payment date to occur on or after the date of such exchange
and as to which interest will be paid, the date of such interest payment date or
(B) if no interest has been paid on the Notes, from the Issue Date.
(h) The Exchange Notes and the Private Exchange Notes may be issued
under (i) the Indenture or (ii) an indenture identical in all material respects
to the Indenture, which in either event shall provide that the Exchange Notes
shall not be subject to the transfer restrictions set forth in the Indenture.
The Indenture or the indenture described in
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this Section 2(h)(ii) shall provide that the Exchange Notes, the Private
Exchange Notes and the Notes shall vote and consent together on all matters as
one class and that neither the Exchange Notes, the Private Exchange Notes nor
the Notes will have the right to vote or consent as a separate class on any
matter.
3. SHELF REGISTRATION
(a) If (i) the Issuers are not permitted to file the Exchange
Registration Statement or to consummate the Exchange Offer because the Exchange
Offer is not permitted by any applicable law or applicable interpretation of the
staff of the SEC or (ii) any holder of a Note notifies the Company that (A) due
to a change in law or policy it is not entitled to participate in the Exchange
Offer, (B) due to a change in law or policy it may not resell Exchange Notes
acquired by it in the Exchange Offer to the public without delivering a
prospectus and the Prospectus contained in the Exchange Registration Statement
is not appropriate or available for such resales by such holder or (C) it owns
Notes (including any Initial Purchaser that holds Notes as part of an unsold
allotment from the original offering of the Notes) acquired directly from an
Issuer or an Affiliate of an Issuer or (iii) any holder of Private Exchange
Notes so requests after the consummation of the Private Exchange or (iv) the
Issuers have not consummated the Exchange Offer within 215 days after the Issue
Date (each such event referred to in clauses (i) through (iv), a "SHELF FILING
EVENT"), the Issuers shall (x) promptly deliver to the holders and the Trustee
notice thereof and (y) at their own expense cause to be filed with the SEC
pursuant to Rule 415 a shelf registration statement (the "SHELF REGISTRATION
STATEMENT") as promptly as practicable and in any event prior to 60 days after
the Issuers became aware that such filing obligation arises relating to all
Transfer Restricted Notes (the "SHELF REGISTRATION") the holders of which have
provided the information required pursuant to Section 3(b) hereof (PROVIDED that
if the Shelf Filing Event arises pursuant to clause (iv) above Exchange Offer
Registration Statement shall not have been filed or shall have been withdrawn,
the Issuers shall file the Shelf Registration Statement on or prior to the 216th
day after the Issue Date), and shall use their best efforts to have the Shelf
Registration Statement declared effective by the SEC on or prior to 60 days
after the filing thereof. In such circumstances, the Issuers shall use their
best efforts to keep the Shelf Registration Statement continuously effective
under the Securities Act, until (A) two years (or such shorter period as may be
established by any
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amendment to the two year period set forth in Rule 144(k) under the Securities
Act) following the Issue Date or (B) if sooner, the date immediately following
the date that all Transfer Restricted Notes covered by the Shelf Registration
Statement have been sold pursuant thereto or otherwise cease to be Transfer
Restricted Notes (the "EFFECTIVENESS PERIOD"); PROVIDED that the Effectiveness
Period shall be extended to the extent required to permit dealers to comply with
the applicable prospectus delivery requirements of Rule 174; PROVIDED, FURTHER,
that the Company may suspend the effectiveness of a Shelf Registration
Statement, in the event that, and for up to five periods of up to 60 consecutive
days, but no more than an aggregate of 180 days during any 365 day period (a
"SHELF BLACKOUT PERIOD") if, (a)(i) an event occurs and is continuing as a
result of which the Shelf Registration Statement would, in the Company's good
faith judgment, contain an untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein not misleading
and (ii) if the Company determines in good faith that the disclosure of such
event at such time would have a material adverse effect on the business,
operations or prospects of the Company or (b) the disclosure otherwise relates
to a pending material business transaction which has not yet been publicly
disclosed. Upon the occurrence of any such suspension, the Issuers will use
their best efforts to reinstate effectiveness of such Shelf Registration
Statement as soon as practicable.
(b) No holder of Transfer Restricted Notes may include any of its
Transfer Restricted Notes in any Shelf Registration Statement pursuant to this
Agreement unless and until such holder furnishes to the Company in writing,
within 30 days after receipt of a request therefor, such information as the
Company may reasonably request for use in connection with any Shelf Registration
Statement or Prospectus or preliminary prospectus included therein. No holder
of Transfer Restricted Notes shall be entitled to Liquidated Damages pursuant to
Section 4 hereof unless and until such holder shall have provided all such
reasonably requested information. Each holder of Transfer Restricted Notes as
to which any Shelf Registration Statement is being effected agrees to furnish
promptly to the Company all information required to be disclosed in order to
make the information previously furnished to the Company by such holder not
materially misleading.
4. LIQUIDATED DAMAGES
(a) The parties hereto agree that the holders of Transfer Restricted
Notes will suffer damages if the Issuers
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fail to fulfill their obligations pursuant to Section 2 or Section 3, as
applicable, and that it would not be feasible to ascertain the extent of such
damages. Accordingly, in the event that:
(i) if (A) neither the Exchange Registration Statement nor the Shelf
Registration Statement is filed with the SEC on or prior to the Filing Date
or (B) notwithstanding that the Issuers have consummated or will consummate
an Exchange Offer, the Issuers are required to file a Shelf Registration
Statement and such Shelf Registration Statement is not filed on or prior to
the date required by this Agreement, then commencing on the day after
either such required filing date, Liquidated Damages shall accrue on the
principal amount of the Notes at a rate of 0.5% per annum for the first 90
days immediately following each such filing date, such Liquidated Damages
rate increasing by an additional 0.5% per annum at the beginning of each
subsequent 90-day period; or
(ii) if (A) an Exchange Registration Statement or a Shelf Registration
Statement has been filed with the SEC but neither the Exchange Registration
Statement nor a Shelf Registration Statement is declared effective by the
SEC on or prior to 60 days after the applicable required filing date or (B)
notwithstanding that the Issuers have consummated or will consummate an
Exchange Offer, the Issuers are required to file a Shelf Registration
Statement and such Shelf Registration Statement is not declared effective
by the SEC on or prior to the 60th day following the date such Shelf
Registration Statement was required to be filed, then, commencing on the
day after the 60th day following the applicable required filing date,
Liquidated Damages shall accrue on the principal amount of the Notes at a
rate of 0.5% per annum for the first 90 days immediately following such
date, such Liquidated Damages rate increasing by an additional 0.5% per
annum at the beginning of each subsequent 90-day period; or
(iii) if (A) the Issuers have not exchanged Exchange Notes for all
Notes validly tendered in accordance with the terms of the Exchange Offer
on or prior to the 36th day after the date on which the Exchange
Registration Statement was declared effective or (B) if applicable, the
Shelf Registration Statement has been declared effective and such Shelf
Registration Statement ceases to be effective at any time prior to the
expiration of the Effectiveness Period, then Liquidated Damages shall
accrue on the
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principal amount of the Notes at a rate of 0.5% per annum for the first 90
days commencing on (x) the 36th day after such effective date, in the case
of (A) above, or (y) the day such Shelf Registration Statement ceases to be
effective in the case of (B) above, such Liquidated Damages rate increasing
by an additional 0.5% per annum at the beginning of each subsequent 90-day
period;
PROVIDED, HOWEVER, that the Liquidated Damages rate on the Notes may
not exceed in the aggregate 2.00% per annum; PROVIDED, FURTHER, HOWEVER,
that (1) upon the filing of the Exchange Registration Statement or a Shelf
Registration Statement (in the case of clause (i) above), (2) upon the
effectiveness of the Exchange Registration Statement or a Shelf
Registration Statement (in the case of clause (ii) above), or (3) upon the
exchange of Exchange Notes for all Notes validly tendered in accordance
with the terms of the Exchange Offer (in the case of clause (iii)(A)
above), or upon the effectiveness of the Shelf Registration Statement which
had ceased to remain effective (in the case of clause (iii)(B) above),
Liquidated Damages on the Notes as a result of such clause (or the relevant
subclause thereof), as the case may be, shall cease to accrue; PROVIDED
FURTHER, that Liquidated Damages shall not accrue during any Shelf Blackout
Period permitted pursuant to Section 3(a).
(b) The Issuers shall notify the Trustee and paying agent under the
Indenture (or the trustee and paying agent under such other indenture under
which any Transfer Restricted Notes are issued) promptly upon the happening of
each and every event described in clauses (a)(i), (a)(ii) or (a)(iii) above
(each a "Registration Default"). The Issuers shall pay the Liquidated Damages
due on the Transfer Restricted Notes by depositing with the paying agent (which
shall not be an Issuer for these purposes) for the Transfer Restricted Notes, in
trust, for the benefit of the holders thereof, prior to 11:00 A.M. on the next
interest payment date specified by the Indenture (or such other indenture), sums
in cash sufficient to pay the Liquidated Damages then due. The Liquidated
Damages due shall be payable on each interest payment date specified by the
Indenture (or such other indenture) to the record holders entitled to receive
the interest payment to be made on such date. Each obligation to pay Liquidated
Damages shall be deemed to accrue from and including the applicable Registration
Default.
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(c) The parties hereto agree that the Liquidated Damages provided for
in this Section 4 constitute a reasonable estimate of the damages that will be
suffered by holders of Transfer Restricted Notes by reason of the happening of
any Registration Default.
5. REGISTRATION PROCEDURES
In connection with the Issuers' registration obligations hereunder,
the Issuers shall effect such registrations on the appropriate form available
for the sale of the Notes, the Exchange Notes or Private Exchange Notes, as
applicable, to (i) in the case of the Exchange Offer, permit the exchange of
Exchange Notes for Notes in the Exchange Offer and, if applicable, resales of
Exchange Notes by Participating Broker-Dealers and (ii) in the case of a Shelf
Registration, permit the sale of the applicable Transfer Restricted Notes in
accordance with the method or methods of disposition thereof specified by the
holders of such Transfer Restricted Notes, and pursuant thereto the Issuers
shall as expeditiously as possible:
(a) In the case of a Shelf Registration, a reasonable period of time
prior to the initial filing of a Shelf Registration Statement or
Prospectus, furnish to the holders of the Transfer Restricted Notes
included in such Shelf Registration Statement, their Special Counsel and
the managing underwriters, if any, copies of all such documents proposed to
be filed, which documents (other than those incorporated or deemed to be
incorporated by reference) will be subject to the review of such holders,
their Special Counsel and such underwriters, if any, and cause the officers
and directors of the Issuers, counsel to the Issuers and independent
certified public accountants to the Issuers to respond to such reasonable
inquiries as shall be necessary, in the opinion of respective counsel to
such holders and such underwriters, to conduct a reasonable investigation
within the meaning of the Securities Act; PROVIDED that the foregoing
inspection and information gathering shall be conducted by the Initial
Purchaser and on behalf of any other persons, by one counsel designated by
and on behalf of such other persons; PROVIDED, HOWEVER, that the Issuers
shall not be deemed to have kept a Shelf Registration Statement effective
during the applicable period if any of them voluntarily takes any
unreasonable action or voluntarily fails to take any reasonable action
(which shall not be deemed to include any action with respect to any Shelf
Blackout Period) that results in holders of the Transfer
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Restricted Notes covered thereby not being able to sell such Transfer
Restricted Notes pursuant to federal securities laws during that period.
The Issuers shall not file any such initial Shelf Registration Statement or
related Prospectus which the holders of a majority in principal amount of
the Transfer Restricted Notes included in such Shelf Registration Statement
shall reasonably object to within 5 business days after receipt thereof;
(b) Prepare and file with the SEC such amendments, including
post-effective amendments, to each Registration Statement as may be
necessary to keep such Registration Statement continuously effective for
the applicable time period required hereunder; cause the related Prospectus
to be supplemented by any required Prospectus supplement, and as so
supplemented to be filed pursuant to Rule 424; and comply with the
provisions of the Securities Act and the Exchange Act with respect to the
disposition of all securities covered by such Registration Statement during
such period in accordance with the intended methods of disposition by the
sellers thereof set forth in such Registration Statement as so amended or
in such Prospectus as so supplemented;
(c) Notify the holders of Transfer Restricted Notes to be sold or, in
the case of an Exchange Offer, tendered for, their Special Counsel and the
managing underwriters, if any, promptly, and (if requested by any such
person), confirm such notice in writing, (i)(A) when a Prospectus or any
Prospectus supplement or post-effective amendment is proposed to be filed,
and (B) with respect to a Registration Statement or any post-effective
amendment, when the same has become effective, (ii) of any request by the
SEC or any other Federal or state governmental authority for amendments or
supplements to a Registration Statement or related Prospectus or for
additional information, (iii) of the issuance by the SEC, any state
securities commission, any other governmental agency or any court of any
stop order or injunction suspending or enjoining the use of a Prospectus or
the effectiveness of a Registration Statement or the initiation of any
proceedings for that purpose, (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or
exemption from qualification of any of the Notes, Exchange Notes or Private
Exchange Notes for sale in any jurisdiction, or the initiation or
threatening of any proceeding for such purpose, and (v) of the happening of
any event or information (but not the
-16-
substance of any information or the event itself) becoming known to any
Issuer that requires the making of any changes in such Registration
Statement, Prospectus or documents so that it will not contain any untrue
statement of a material fact or omit to state any material fact required to
be stated therein or necessary to make the statements therein, not
misleading, and that in the case of a Prospectus, it will not contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading;
(d) Use their best efforts to avoid the issuance of or, if issued,
obtain the withdrawal of any order enjoining or suspending the use of a
Prospectus or the effectiveness of a Registration Statement or the lifting
of any suspension of the qualification (or exemption from qualification) of
any of the Notes, Exchange Notes or Private Exchange Notes for sale in any
jurisdiction, at the earliest practicable moment;
(e) If a Shelf Registration Statement is filed pursuant to Section 3
hereof and if requested by the managing underwriters, if any, or the
holders of a majority in aggregate principal amount of the Transfer
Restricted Notes being sold pursuant to such Shelf Registration Statement,
(i) promptly incorporate in a Prospectus supplement or post-effective
amendment such information as the managing underwriters, if any, and such
holders reasonably believe should be included therein, and (ii) make all
required filings of such Prospectus supplement or such post-effective
amendment under the Securities Act as soon as practicable after the Company
has received notification of the matters to be incorporated in such
Prospectus supplement or post-effective amendment; PROVIDED, HOWEVER, that
the Issuers shall not be required to take any action pursuant to this
Section 5(e) that would, in the opinion of counsel for the Issuers, violate
any applicable laws;
(f) Upon written request to the Company by a holder of Notes,
Exchange Notes or Private Exchange Notes to be exchanged or sold pursuant
to a Registration Statement, their Special Counsel and each managing
underwriter, if any, without charge, furnish at least one conformed copy of
such Registration Statement and each amendment thereto, including financial
statements and schedules, all
-17-
documents incorporated or deemed to be incorporated therein by reference,
and all exhibits to the extent requested (including those previously
furnished or incorporated by reference) as soon as practicable after the
filing of such documents with the SEC;
(g) Deliver to each holder of Notes, Exchange Notes or Private
Exchange Notes to be exchanged or sold pursuant to a Registration
Statement, their Special Counsel, and the underwriters, if any, without
charge, as many copies of the Prospectus (including each form of
prospectus) and each amendment or supplement thereto as such persons
reasonably request; and the Issuers hereby consent to the use of such
Prospectus and each amendment or supplement thereto by each of the selling
holders of Transfer Restricted Notes and the underwriters, if any, in
connection with the offering and sale of the Transfer Restricted Notes in
accordance with the terms thereof and with U.S. federal securities laws and
Blue Sky laws covered by such Prospectus and any amendment or supplement
thereto;
(h) Prior to any public offering of Notes, Exchange Notes or Private
Exchange Notes, use their best efforts to register or qualify or cooperate
with the holders of Notes, Exchange Notes or Private Exchange Notes to be
sold or tendered for, the underwriters, if any, and their Special Counsel
in connection with the registration or qualification (or exemption from
such registration or qualification) of such Notes, Exchange Notes or
Private Exchange Notes for offer and sale under the securities or Blue Sky
laws of such jurisdictions within the United States as any such holder or
underwriter reasonably requests in writing; keep each such registration or
qualification (or exemption therefrom) effective during the period such
Registration Statement is required to be kept effective hereunder and do
any and all other acts or things necessary or advisable to enable the
disposition in such jurisdictions of the Notes, Exchange Notes or Private
Exchange Notes covered by the applicable Registration Statement; PROVIDED,
HOWEVER, that the Issuers shall not be required to (i) qualify generally to
do business in any jurisdiction where they are not then so qualified or
(ii) take any action which would subject them to general service of process
or to taxation in any jurisdiction where they are not so subject;
-18-
(i) In connection with any sale or transfer of Transfer Restricted
Notes that will result in such securities no longer being Transfer
Restricted Notes, cooperate with the holders thereof and the managing
underwriters, if any, to facilitate the timely preparation and delivery of
certificates representing Transfer Restricted Notes to be sold, which
certificates shall not bear any restrictive legends and shall be in a form
eligible for deposit with The Depository Trust Company and to enable such
Transfer Restricted Notes to be in such denominations and registered in
such names as the managing underwriters, if any, or such holders may
request at least two Business Days prior to any sale of Transfer Restricted
Notes;
(j) Upon the occurrence of any event contemplated by Section 5(c)(v)
hereof, as promptly as practicable, prepare a supplement or amendment,
including, if appropriate, a post-effective amendment, to each Registration
Statement or a supplement to the related Prospectus or any document
incorporated or deemed to be incorporated therein by reference, and file
any other required document so that, as thereafter delivered, such
Prospectus will not 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 light of the circumstances under which they were
made, not misleading;
(k) Prior to the effective date of the Exchange Registration
Statement, to provide a CUSIP number for the Exchange Notes (and Private
Exchange Notes, if applicable);
(l) If a Shelf Registration Statement is filed pursuant to Section 3
hereof in connection with not more than one underwritten offering in which
all holders of Transfer Restricted Notes are entitled to participate, enter
into such agreements (including an underwriting agreement in form, scope
and substance as is customary in underwritten offerings) and take all such
other reasonable actions in connection therewith (including those
reasonably requested by the managing underwriters, if any, or the holders
of a majority in aggregate principal amount of the Transfer Restricted
Notes being sold) in order to expedite or facilitate the disposition of
such Transfer Restricted Notes, and, whether or not an underwriting
agreement is entered into and whether or not the
-19-
registration is an underwritten registration, (i) make such representations
and warranties to the holders of such Transfer Restricted Notes and the
underwriters, if any, with respect to the business of the Issuers and their
subsidiaries (including with respect to businesses or assets acquired or to
be acquired by any of them), and the Shelf Registration Statement,
Prospectus and documents, if any, incorporated or deemed to be incorporated
by reference therein, 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 customarily requested; (ii) obtain opinions
of counsel to the Issuers and updates thereof (which counsel and opinions
(in form, scope and substance) shall be reasonably satisfactory to the
managing underwriters, if any, and Special Counsel to the holders of the
Transfer Restricted Notes being sold), addressed to each selling holder of
Transfer Restricted Notes and each of the underwriters, if any, covering
the matters customarily covered in opinions requested in underwritten
offerings and such other matters as may be reasonably requested by such
Special Counsel and the managing underwriters, if any; (iii) use their best
efforts to obtain customary "cold comfort" letters and updates thereof from
the independent certified public accountants of the Issuers (and, if
necessary, any other independent certified public accountants of any
subsidiary of the Issuers or of any business acquired by an Issuer or any
such subsidiary for which financial statements and financial data is, or is
required to be, included in the Shelf Registration Statement), addressed
(where reasonably possible) to each selling holder of Transfer Restricted
Notes and each of the underwriters, if any, such letters to be in customary
form and covering matters of the type customarily covered in "cold comfort"
letters in connection with underwritten offerings; (iv) if an underwriting
agreement is entered into, the same shall contain indemnification
provisions and procedures no less favorable to the selling holders and the
underwriters, if any, than those set forth in Section 7 hereof (or such
other provisions and procedures acceptable to holders of a majority in
aggregate principal amount of Transfer Restricted Notes covered by such
Shelf Registration Statement and the managing underwriters, if any); and
(v) deliver such documents and certificates as may be reasonably requested
by the holders of a majority in aggregate principal amount of the Transfer
Restricted Notes being sold, their Special Counsel and the managing
underwriters, if any, to evidence the continued validity
-20-
of the representations and warranties made pursuant to clause (i) above and
to evidence compliance with any customary conditions contained in the
underwriting agreement or other agreement entered into by the Issuers;
(m) In the case of a Shelf Registration, make available for
inspection by a representative of the holders of Transfer Restricted Notes
being sold, any underwriter participating in any such disposition of
Transfer Restricted Notes, and any attorney, consultant or accountant
retained by such selling holders or underwriter, which inspection shall be
coordinated on behalf of all such underwriters and selling holders by one
representative designated by and on behalf of such underwriters and selling
holders(collectively, the "Inspectors") at the offices where normally kept,
during reasonable business hours, all relevant financial and other records,
pertinent corporate documents, instruments of the Issuer and its
subsidiaries (collectively, the "Records") as shall be reasonably necessary
to enable them to exercise any applicable due diligence responsibilities,
and properties of the Issuers and their subsidiaries (including with
respect to businesses and assets acquired or to be acquired to the extent
that such information is available to the Issuers), and cause the officers,
directors, agents and employees of the Issuers and their subsidiaries
(including with respect to businesses and assets acquired or to be acquired
to the extent that such information is available to the Issuers) to supply
all information in each case reasonably requested by any such
representative, underwriter, attorney, consultant or accountant in
connection with such Shelf Registration; PROVIDED, HOWEVER, that such
persons shall first agree in writing with the Company that any information
that is reasonably and in good faith designated by the Company in writing
as confidential at the time of delivery of such information shall be kept
confidential by such persons, unless and to the extent that (i) disclosure
of such information is, in the opinion of counsel for any Inspector,
necessary or advisable in connection with any action, claim, suit or
proceeding, directly or indirectly, involving or potentially involving such
Inspector and arising out of, based upon, relating to, or involving this
Agreement, or any transactions contemplated hereby or arising hereunder, or
(ii) the information in such Records has been required by court or
administrative order or is necessary to respond to inquiries of regulatory
authorities, (iii) disclosure of such information is
-21-
required by law (excluding any disclosure requirements pursuant to Federal
securities laws in connection with the filing of the Shelf Registration
Statement or the use of any Prospectus without the consent of the Issuers
which will not be unreasonably withheld), (iv) such information becomes
generally available to the public other than as a result of a disclosure or
failure to safeguard such information by such person or (v) such
information becomes available to such person from a source other than the
Issuers and their subsidiaries and such source is not bound by a
confidentiality agreement; and PROVIDED, FURTHER, that the foregoing
inspection and information gathering shall be conducted by the Initial
Purchaser and on behalf of any other persons, by one counsel designated by
and on behalf of such other persons;
(n) Provide an indenture trustee for the Notes and/or the Exchange
Notes and Private Exchange Notes, as the case may be, and cause an
indenture to be qualified under the TIA not later than the effective date
of the first Registration Statement relating to the Notes and/or the
Exchange Notes and Private Exchange Notes, as the case may be; and if such
indenture shall be the Indenture, in connection therewith, cooperate with
the Trustee and the holders of the Notes and/or the Exchange Notes and
Private Exchange Notes, to effect such changes to the Indenture, if any, as
may be required for the Indenture to be so qualified in accordance with the
terms of the TIA; and execute, and use its reasonable efforts to cause the
Trustee to execute, all customary 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;
(o) Comply with all applicable rules and regulations of the SEC and
make generally available to their securityholders earning statements
satisfying the provisions of Section 11(a) of the Securities Act and
Rule 158, no later than 45 days after the end of any 12-month period (or 90
days after the end of any 12-month period if such period is a fiscal year)
(i) commencing at the end of any fiscal quarter in which Transfer
Restricted Notes are sold to underwriters in a firm commitment or
reasonable efforts underwritten offering and (ii) if not sold to
underwriters in such an offering, commencing on the first day of the first
fiscal quarter after the effective date of a Registration Statement, which
-22-
statement shall cover said period, consistent with the requirements of
Rule 158;
(p) Upon consummation of an Exchange Offer or a Private Exchange, if
required by the Trustee or a majority of the holders of the Notes
participating in the Exchange Offer or Private Exchange, obtain an opinion
of counsel to the Issuer, in a form customary for underwritten
transactions, addressed to the Trustee for the benefit of all holders of
Exchange Notes or Private Exchange Notes participating in the Exchange
Offer or the Private Exchange, as the case may be, that the Exchange Notes
or Private Exchange Notes, as the case may be, and the related indenture
constitute legal, valid and binding obligations of the Issuer, enforceable
against the Issuer in accordance with their respective terms;
(q) Cooperate with each seller of Transfer Restricted Notes covered
by any Registration Statement and each underwriter, if any, participating
in the disposition of such Transfer Restricted Notes and their respective
counsel in connection with any filings required to be made with the
National Association of Securities Dealers, Inc.; and
(r) Use their best efforts to take all other steps reasonably
necessary to effect the registration of the Transfer Restricted Notes
covered by a Registration Statement contemplated hereby.
The Issuers may require a holder of Transfer Restricted Notes to be
included in a Registration Statement to furnish to the Issuers such information
regarding the distribution of such Transfer Restricted Notes as is required by
law to be disclosed in such Registration Statement and the Issuers may exclude
from such Registration Statement the Transfer Restricted Notes of any holder who
unreasonably fails to furnish such information within a reasonable time after
receiving such request.
If any such Registration Statement refers to any holder by name or
otherwise as the holder of any securities of an Issuer, then such holder shall
have the right to require (i) the insertion therein of language, in form and
substance reasonably satisfactory to such holder, to the effect that the holding
by such holder of such securities is not to be construed as a recommendation by
such holder of the investment quality of the Issuers' securities covered thereby
and that
-23-
such holding does not imply that such holder will assist in meeting any future
financial requirements of the Issuers, or (ii) in the event that such reference
to such holder by name or otherwise is not required by the Securities Act, the
deletion of the reference to such holder in any amendment or supplement to the
Registration Statement filed or prepared subsequent to the time that such
reference ceases to be required.
In the case of a Shelf Registration pursuant to Section 3 hereof, each
holder of Transfer Restricted Notes agrees by acquisition of such Transfer
Restricted Notes that, upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 5(c)(ii),
5(c)(iii),5(c)(iv) or 5(c)(v) hereof, such holder will forthwith discontinue
disposition of such Transfer Restricted Notes covered by such Registration
Statement or Prospectus until such holder's receipt of the copies of the
supplemented or amended Prospectus contemplated by Section 5(j) hereof, or until
it is advised in writing by the Company that the use of the applicable
Prospectus may be resumed, and, in either case, has received copies of any
additional or supplemental filings that are incorporated or deemed to be
incorporated by reference in such Prospectus.
6. REGISTRATION EXPENSES
All fees and expenses incident to the performance of or compliance
with this Agreement by the Issuers shall be borne by the Issuers whether or not
any Registration Statement is filed or becomes effective and whether or not any
Notes, Exchange Notes or Private Exchange Notes are issued or sold pursuant to
any Registration Statement. The fees and expenses referred to in the foregoing
sentence shall include, without limitation, (i) all registration and filing fees
(including, without limitation, fees and expenses (A) with respect to filings
required to be made with the National Association of Securities Dealers, Inc.
and (B) in compliance with securities or Blue Sky laws), (ii) messenger,
telephone and delivery expenses, (iii) fees and disbursements of counsel for the
Issuers and the Special Counsel (not to exceed one firm or counsel), (iv) fees
and disbursements of all independent certified public accountants referred to in
Section 2(e) and Section 5(l)(iii) hereof (including, without limitation, the
expenses of any special audit and "cold comfort" letters required by or incident
to such performance), (v) Securities Act liability insurance, if the Company
desires such insurance, (vi) the expenses relating to printing, word processing
and distributing all Registration Statements, underwriting agreements and other
documents
-24-
(including, without limitation, expenses of printing certificates for Notes,
Exchange Notes and Private Exchange Notes in a form eligible for deposit with
The Depository Trust Company) necessary in order to comply with this Agreement,
(vii) the fees and expenses of the Trustee and any exchange agent and the fees
and expenses of their counsel; (viii) rating agency fees, if any, and any fees
associated with making Transfer Restricted Notes eligible for trading through
The Depository Trust Company, and (ix) fees and expenses of all other persons
retained by the Issuers. In addition, the Issuers shall pay their internal
expenses (including, without limitation, all salaries and expenses of their
respective officers and employees performing legal or accounting duties), the
expense of any annual audit, and the fees and expenses incurred in connection
with the listing of the Notes, Exchange Notes or Private Exchange Notes to be
registered on any securities exchange.
7. INDEMNIFICATION
(a) The Issuers agree, jointly and severally, to indemnify and hold
harmless (i) the Initial Purchaser, each holder of Notes, Exchange Notes and
Private Exchange Notes and each Participating Broker-Dealer, (ii) each person,
if any, who controls (within the meaning of Section 15 of the Act or Section 20
of the Exchange Act) any of the foregoing (any of the persons referred to in
this clause (ii) being hereinafter referred to as a "controlling person"), and
(iii) the respective officers, directors, partners, employees, representatives
and agents of the Initial Purchaser, each holder of Notes, Exchange Notes and
Private Exchange Notes, each Participating Broker-Dealer and any controlling
person (any person referred to in clause (i), (ii) or (iii) may hereinafter be
referred to as an "INDEMNIFIED PERSON"), from and against any and all losses,
claims, damages, liabilities and judgments arising out of or relating to any
untrue statement or alleged untrue statement of a material fact contained in any
Registration Statement, Prospectus or preliminary prospectus or in any amendment
or supplement thereto, or arising out of or relating to any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein (in the case of any Prospectus or
preliminary prospectus or supplement thereto, in light of the circumstances
under which they were made) not misleading, except insofar as such losses,
claims, damages, liabilities or judgments are caused by any such untrue
statement or omission or alleged untrue statement or omission based upon
information relating to any Indemnified Person furnished in writing to the
Issuers by or on behalf of
-25-
such Indemnified Person expressly for use therein; PROVIDED the Issuers will not
be liable (i) in any such case to the extent that any such loss, claim, damage,
or liability arises out of or is based upon any untrue statement or alleged
untrue statement or omission or alleged omission made in any Prospectus or any
amendment or supplement thereto in reliance upon and in conformity with written
information concerning the Initial Purchaser or any other Indemnified Person
furnished to an Issuer by the Initial Purchaser or any other Indemnified Person
specifically for use therein or (ii) with respect to the Preliminary Prospectus
or Prospectus, to the extent that any such loss, claim, damage or liability
arises solely from the fact that the Initial Purchaser or any other Indemnified
Person sold Securities to a person to whom there was not sent or given a copy of
the Prospectus (as amended or supplemented) at or prior to the written
confirmation of such sale if such Issuer shall have previously furnished copies
thereof to such Initial Purchaser or such other Indemnified Person in accordance
with this Registration Rights Agreement and the Prospectus (as amended or
supplemented) would have corrected any such untrue statement or omission.
(b) In case any action shall be brought against any Indemnified
Person, based upon any Registration Statement or any Prospectus or preliminary
prospectus or any amendment or supplement thereto and with respect to which
indemnity may be sought against the Issuers hereunder, such Indemnified Person
shall promptly notify the Issuers in writing and the Company shall assume the
defense thereof, including the employment of counsel reasonably satisfactory to
such Indemnified Person and payment of all fees and expenses. Any Indemnified
Person shall have the right to employ separate counsel in any such action and
participate in the defense thereof, but the fees and expenses of such counsel
shall be at the expense of such Indemnified Person, unless (i) the employment of
such counsel shall have been specifically authorized in writing by the Issuers,
(ii) the Company shall have failed to assume the defense and employ counsel or
pay all such fees and expenses or (iii) the named parties to any such action
(including any impleaded parties) include both such Indemnified Person and an
Issuer and such Indemnified Person shall have been advised by counsel that there
may be one or more legal defenses available to it which are different from or
additional to those available to any such Issuer (in which case the Company
shall not have the right to assume the defense of such action on behalf of such
Indemnified Person, it being understood, however, that the Issuers shall not, in
connection with any one such action or separate but substantially similar or
related
-26-
actions in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of more than one
separate firm of attorneys (in addition to any local counsel) for all such
Indemnified Persons, which firm shall be designated in writing by such
Indemnified Persons, and that all such reasonable fees and expenses shall be
reimbursed as they are incurred). The Issuers shall not be liable for any
settlement of any such action effected without their prior written consent,
which shall not be unreasonably withheld (for purposes of this sentence, it is
deemed reasonable to withhold consent if such settlement (A) does not include an
unconditional written release of the Issuers, in form and substance reasonably
satisfactory to the Issuers, from all liability on claims that are the subject
matter of such proceeding or (B) includes any statement as to an admission of
fault, culpability or failure to act by or on behalf of any Issuer). If settled
with the written consent of the Issuers, the Issuers agree, jointly and
severally, to indemnify and hold harmless each Indemnified Person from and
against any loss or liability by reason of such settlement. No Issuer shall,
without the prior written consent of each Indemnified Person, effect any
settlement of any pending or threatened proceeding in respect of which any
Indemnified Person is a party and indemnity could have been sought hereunder by
such Indemnified Person, unless such settlement includes an unconditional
release of such Indemnified Person from all liability on claims that are the
subject matter of such proceeding.
(c) In connection with any Registration Statement pursuant to which a
holder of Transfer Restricted Notes offers or sells Transfer Restricted Notes,
such holder agrees, severally and not jointly, to indemnify and hold harmless
the Issuers, their respective directors and officers and any person controlling
an Issuer within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act, to the same extent as the foregoing indemnity from the
Issuers to each Indemnified Person but only with respect to information relating
to such holder furnished in writing by or on behalf of such holder expressly for
use in such Registration Statement. In any such case in which any action shall
be brought against an Issuer, any director or officer of an Issuer or any person
controlling an Issuer based on such Registration Statement and in respect of
which indemnity may be sought against a holder of Transfer Restricted Notes,
such holder shall have the rights and duties given to the Issuers under Section
7(b) hereof(except that if an Issuer shall have assumed the defense thereof,
such holder shall not be required to do so, but may
-27-
employ separate counsel therein and participate in the defense thereof but the
fees and expenses of such counsel shall be at the expense of such holder), and
the Issuers, their respective directors and officers and any person controlling
an Issuer shall have the rights and duties given to the Indemnified Persons by
Section 7(b) hereof.
(d) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party in respect of any losses, claims, damages,
liabilities or judgments referred to herein, then each indemnifying party, in
lieu of indemnifying such indemnified party, shall contribute to the amount paid
or payable by such indemnified party as a result of such losses, claims,
damages, liabilities and judgments (i) in such proportion as is appropriate to
reflect the relative benefits received by each indemnifying party on the one
hand and the indemnified party on the other hand from the offering of the Notes,
the Exchange Notes or the Private Exchange Notes, as the case may be (it being
expressly understood and agreed that the relative benefits received by the
Issuers from the offering of the Notes, Exchange Notes or Private Exchange
Notes, as the case may be, shall be the amount of the net proceeds received by
the Company from the sale of the Notes), or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of each indemnifying party on the one hand and
the indemnified party 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 each indemnifying party on the one hand and the indemnified party 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 to
state a material fact relates to information supplied by an indemnifying party
or such indemnified party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Issuers and the Initial Purchaser agree that it would not be just
and equitable if contribution pursuant to this Section 7(d) were determined by
PRO RATA allocation (even if all Indemnified Persons 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
-28-
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 such action or claim. Notwithstanding the provisions of this
Section 7, no Indemnified Person shall be required to contribute any amount in
excess of the amount by which the net proceeds received by it in connection with
the sale of the Notes, Exchange Notes or Private Exchange Notes contemplated by
this Agreement (or, in the case of an underwriter that is an Indemnified Person,
the total underwriting discounts received by such underwriter) exceeds the
amount of any damages which such Indemnified Person 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. The Indemnified Person's obligations to contribute pursuant
to this Section 7(d) are several in proportion to the respective amount of
Notes, Exchange Notes or Private Exchange Notes included in any such
Registration Statement by each Indemnified Person and not joint.
8. RULES 144 AND 144A
Each of the Issuers covenants and agrees that it will file the reports
required to be filed by it under the Securities Act and the Exchange Act and the
rules and regulations adopted by the SEC thereunder in a timely manner in
accordance with the requirements of the Securities Act and the Exchange Act and,
if at any time such Issuer is not required to file such reports, such Issuer
will, upon the request of any Holder or beneficial owner of Transfer Restricted
Notes, make available such information necessary to permit sales pursuant to
Rule 144A under the Securities Act. Each of the Issuers further covenants and
agrees, for so long as any Transfer Restricted Notes remain outstanding that it
will make available to any Holder of Transfer Restricted Notes, all information
necessary to the extent required from time to time to enable such holder to sell
Transfer Restricted Notes without registration under the Securities Act within
the limitation of the exemptions provided by (a) Rule 144(k) and Rule 144A under
the Securities Act, as such Rules may be amended from time to time, or (b) any
similar rule or regulation hereafter adopted by the SEC.
-29-
9. UNDERWRITTEN REGISTRATIONS
If any of the Transfer Restricted Notes covered by any Shelf
Registration are to be sold in an underwritten offering, the investment banker
or investment bankers and manager or managers that will administer the offering
will be selected by the holders of a majority in aggregate principal amount of
the Transfer Restricted Notes included in such offering and reasonably
acceptable to the Company.
No person may participate in any underwritten registration hereunder
unless such person (i) agrees to sell such Transfer Restricted Notes on the
basis reasonably provided in any underwriting arrangements approved by the
persons entitled hereunder to approve such arrangements and (ii) completes and
executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents required under the terms of such underwriting
arrangements.
10. MISCELLANEOUS
(a) REMEDIES. In the event of a breach by an Issuer or by a holder
of Notes, Exchange Notes or Private Exchange Notes of any of its obligations
under this Agreement, each holder of Notes, Exchange Notes or Private Exchange
Notes and each Issuer, in addition to being entitled to exercise all rights
granted by law, including recovery of damages, will be entitled to specific
performance of its rights under this Agreement. Notwithstanding the provisions
of Section 4 hereof, the Issuers and each holder of Notes, Exchange Notes and
Private Exchange Notes agree that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach of any of the
provisions of this Agreement and each hereby further agrees that, in the event
of any action for specific performance in respect of such breach, it shall waive
the defense that a remedy at law would be adequate.
(b) NO INCONSISTENT AGREEMENTS. The Issuers will not enter into any
agreement with respect to their securities that is inconsistent with the rights
granted to the holders of Notes, Exchange Notes and Private Exchange Notes and
Indemnified Persons in this Agreement or otherwise conflicts with the provisions
hereof. Without the written consent of the holders of a majority in aggregate
principal amount of the outstanding Transfer Restricted Notes, the Issuers shall
not grant to any person any rights which conflict with or are inconsistent with
the provisions of this Agreement.
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(c) NO PIGGYBACK ON REGISTRATIONS. The Issuers shall not grant to
any of their securityholders (other than the holders of Transfer Restricted
Notes in such capacity) the right to include any of their securities in any
Registration Statement other than Transfer Restricted Notes.
(d) 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, otherwise than with the prior written consent of the holders
of not less than a majority of the then outstanding aggregate principal amount
of Transfer Restricted Notes; PROVIDED, HOWEVER, that, for the purposes of this
Agreement, Transfer Restricted Notes that are owned, directly or indirectly, by
the Issuers or any of their Affiliates are not deemed outstanding.
Notwithstanding the foregoing, a waiver or consent to depart from the provisions
hereof with respect to a matter that relates exclusively to the rights of
holders of Transfer Restricted Notes whose securities are being sold or tendered
pursuant to a Registration Statement and that does not directly or indirectly
affect the rights of other holders of Transfer Restricted Notes may be given by
holders of a majority in aggregate principal amount of the Transfer Restricted
Notes being sold or tendered by such holders pursuant to such Registration
Statement; PROVIDED, HOWEVER, that the provisions of this sentence may not be
amended, modified or supplemented except in accordance with the provisions of
the immediately preceding sentence. Notwithstanding the foregoing, no
amendment, modification, supplement, waiver or consent with respect to Section 7
shall be effective as against any holder of an Indemnified Person unless
consented to in writing by such Indemnified Person.
(e) NOTICES. All notices and other communications provided for
herein shall be made in writing by hand-delivery, next-day air courier,
certified first-class mail, return receipt requested, telex or telecopier:
(i) if to the Issuers, as provided in the Purchase Agreement,
(ii) if to the Initial Purchaser, as provided in the Purchase
Agreement, or
(iii) if to any other person who is then the registered holder of
Notes, Exchange Notes or Private Exchange
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Notes, to the address of such holder as it appears in the register therefor
of the Company.
Except as otherwise provided in this Agreement, all such
communications shall be deemed to have been duly given: when delivered by hand,
if personally delivered; one Business Day after being timely delivered to a
next-day air courier; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; and when receipt is
acknowledged by the recipient's telecopier machine, if telecopied.
(f) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and be binding upon the successors and permitted assigns of each of
the parties and shall inure to the benefit of each holder of Notes, Exchange
Notes and Private Exchange Notes and each Indemnified Person. The Issuers may
not assign any of their rights or obligations hereunder without the prior
written consent of each holder of Transfer Restricted Notes and each Indemnified
Person. Notwithstanding the foregoing, no successor or assignee of an Issuer
shall have any of the rights granted under this Agreement until such person
shall acknowledge its rights and obligations hereunder by a signed written
statement of such person's acceptance of such rights and obligations.
(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) GOVERNING LAW; SUBMISSION TO JURISDICTION. THIS AGREEMENT SHALL
BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK.
THE ISSUERS HEREBY IRREVOCABLY SUBMIT TO THE JURISDICTION OF ANY NEW YORK STATE
COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK OR ANY FEDERAL
COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN RESPECT OF
ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, AND
EACH IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY
AND UNCONDITIONALLY, JURISDICTION OF THE AFORESAID COURTS.
(i) SEVERABILITY. The remedies provided herein are cumulative and
not exclusive of any remedies provided by law. If any term, provision, covenant
or restriction of this
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Agreement is held by a court of competent jurisdiction to be invalid, illegal,
void or unenforceable, the remainder of the terms, provisions, covenants and
restrictions set forth herein shall remain in full force and effect and shall in
no way be affected, impaired or invalidated, and the parties hereto shall use
their reasonable efforts to find and employ an alternative means to achieve the
same or substantially the same result as that contemplated by such term,
provision, covenant or restriction. It is hereby stipulated and declared to be
the intention of the parties that they would have executed the remaining terms,
provisions, covenants and restrictions without including any of such that may be
hereafter declared invalid, illegal, void or unenforceable.
(j) HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof. All
references made in this Agreement to "Section" and "paragraph" refer to such
Section or paragraph of this Agreement, unless expressly stated otherwise.
(k) ENTIRE AGREEMENT. This Agreement is intended by the parties as a
final expression of their agreement and is intended to be a complete and
exclusive statement of the agreement and understanding of the parties hereto in
respect of the subject matter contained herein. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein with respect to the registration rights granted by the Issuers with
respect to the Notes, the Exchange Notes and the Private Exchange Notes. This
Agreement supersedes all prior agreements and understandings between the parties
with respect to such subject matter.
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IN WITNESS WHEREOF, the parties have caused this Registration Rights
Agreement to be duly executed as of the date first written above.
OUTSOURCING SERVICES GROUP, INC.
By: /s/ Xxxxxx Xxxxxxx
----------------------
Name: Xxxxxx Xxxxxxx
Title: Chief Financial
Officer
The foregoing Agreement is
hereby confirmed and accepted
as of the date first above
written.
BT ALEX. XXXXX INCORPORATED
By: /s/ Xxxxxxx Xxxxxxxxx
---------------------------
Name: Xxxxxxx Xxxxxxxxx
Title: Vice President
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Each of the Subsidiaries specified below agrees to become a party to
this Agreement as a Subsidiary Guarantor as of the date hereof:
AEROSOL SERVICES COMPANY, INC.
By:
----------------------------------
Name:
Title:
PIEDMONT LABORATORIES, INC.
By:
----------------------------------
Name:
Title:
KOLMAR LABORATORIES, INC.
By:
----------------------------------
Name:
Title:
