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EXHIBIT 4.2
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made
and entered into as of February 11, 1997 between SYNTHETIC INDUSTRIES, INC., a
Delaware corporation (the "Company"), and Bear, Xxxxxxx & Co. Inc. (the
"Initial Purchaser").
This Agreement is made pursuant to the Purchase Agreement
dated as of February 6, 1997 between the Company and the Initial Purchaser (the
"Purchase Agreement"), which provides for the sale by the Company to the
Initial Purchaser of an aggregate of $125,000,000 aggregate principal amount of
the Company's 9 1/4% Senior Subordinated Notes due 2007 (the "Notes"). In
order to induce the Initial Purchaser to enter into the Purchase Agreement and
to purchase the Notes, the Company has agreed to provide to the Initial
Purchaser and its direct and indirect transferees the registration rights for
the Notes set forth in this Agreement. The execution and delivery of this
Agreement is a condition precedent to the obligations of the Initial Purchaser
under the Purchase Agreement.
In consideration of the foregoing, the parties hereto agree as
follows:
1. Definitions. As used in this Agreement, the following
capitalized defined terms shall have the following meanings (and, unless
otherwise indicated, capitalized terms used herein without definition shall
have the meanings ascribed to them in the Purchase Agreement):
"Act" shall mean the Securities Act of 1933, as amended.
"Agreement" shall have the meaning set forth in the preamble
to this Agreement.
"Applicable Period" shall have the meaning set forth in
Section 3(t) hereof.
"Closing Date" shall mean the Closing Date as defined in the
Purchase Agreement.
"Commission" shall mean the Securities and Exchange
Commission, or such other federal agency administering the Act or the
Exchange Act.
"Company" shall have the meaning set forth in the preamble to
this Agreement, and shall also include the Company's successors.
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"Depository" shall mean The Depository Trust Company, or any
successor depositary appointed by the Company; provided, however, that
such depositary must have an address in the Borough of Manhattan, The
City of New York.
"Effectiveness Period" shall have the meaning set forth in
Section 2(b) hereof.
"Event Date" shall have the meaning set forth in Section 2(e)
hereof.
"Exchange Act" shall mean the Securities Exchange Act of 1934,
as amended.
"Exchange Offer" shall mean the exchange offer by the Company
of Exchange Notes for Notes pursuant to Section 2(a) hereof.
"Exchange Offer Registration" shall mean a registration under
the Act effected pursuant to Section 2(a) hereof.
"Exchange Offer Registration Statement" shall mean the
registration statement (on Form S-4 or, if applicable, on any other
appropriate form) relating to the Exchange Offer, and all amendments
and supplements to such registration statement, including
post-effective amendments, in each case including the Prospectus
contained therein, all exhibits thereto and all material incorporated
by reference therein.
"Exchange Period" shall have the meaning set forth in Section
2(a) hereof.
"Exchange Notes" shall mean the 9 1/4% Series B Senior
Subordinated Notes due 2007, to be issued by the Company under the
Indenture and containing terms identical to the Notes (except that (i)
interest thereon shall accrue from the last date on which interest was
paid on the Notes or, if no such interest has been paid, from February
11, 1997, and (ii) the transfer restrictions thereon shall be
eliminated) to be offered to Holders of Notes in exchange for Notes
pursuant to the Exchange Offer.
"Holder" shall mean the Initial Purchaser, for so long as it
owns any Registrable Securities, and each of its respective
successors, assigns and direct and indirect transferees who become
registered owners of Registrable Securities under the Indenture.
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"Indenture" shall mean the Indenture dated as of February 11,
1997 by and between the Company and United States Trust Company of New
York, as trustee, as the same may be amended or supplemented from time
to time in accordance with the terms thereof.
"Initial Purchaser" shall have the meaning set forth in the
preamble to this Agreement.
"Inspectors" shall have the meaning set forth in Section 3(n)
hereof.
"Liquidated Damages" shall have the meaning set forth in
Section 2(e) hereof.
"Majority Holders" shall mean the Holders of a majority of the
aggregate principal amount of outstanding (as determined under the
Indenture) Registrable Securities.
"NASD" shall mean the National Association of Securities
Dealers, Inc.
"Notes" shall have the meaning set forth in the preamble to
this Agreement.
"Participating Broker-Dealer" shall have the meaning set forth
in Section 3(t) hereof.
"Person" shall mean any individual, corporation, limited
liability company, general or limited partnership, limited liability
partnership, joint venture, association, joint-stock company, trust,
charitable foundation, unincorporated organization, government or
agency or political subdivision thereof or any other entity.
"Private Exchange" shall have the meaning set forth in Section
2(a) hereof.
"Private Exchange Notes" shall have the meaning set forth in
Section 2(a) hereof.
"Prospectus" shall mean the prospectus included in a
Registration Statement, including any preliminary prospectus, and any
such prospectus as amended or supplemented by any prospectus
supplement, including a prospectus supplement with respect to the
terms of the offering of any portion of the Registrable Securities
covered by a Shelf Registration Statement, including
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post-effective amendments, and in each case including all material
incorporated by reference therein.
"Purchase Agreement" shall have the meaning set forth in the
preamble to this Agreement.
"Records" shall have the meaning set forth in Section 3(n)
hereof.
"Registrable Securities" shall mean the Notes and, if issued,
the Private Exchange Notes; provided, however, that Notes or Private
Exchange Notes, as the case may be, shall cease to be Registrable
Securities when (i) a Registration Statement with respect to such
Notes or Private Exchange Notes or the resale thereof shall have been
declared effective under the Act and such Notes or Private Exchange
Notes, as the case may be, shall have been disposed of pursuant to
such Registration Statement, (ii) such Notes or Private Exchange
Notes, as the case may be, shall have become eligible to be sold to
the public pursuant to Rule 144(k) (or any similar provision then in
force, but not Rule 144A) under the Act, (iii) such Notes or Private
Exchange Notes, as the case may be, shall have ceased to be
outstanding or (iv) with respect to the Notes, such Notes have been
exchanged for Exchange Notes upon consummation of the Exchange Offer.
"Registration Expenses" shall mean any and all expenses
incident to performance of or compliance by the Company with this
Agreement, including, without limitation: (i) Commission, stock
exchange or NASD registration and filing fees, including, if
applicable, the fees and expenses of any "qualified independent
underwriter" and its counsel that is required to be retained by any
Holder of Registrable Securities in accordance with the rules and
regulations of the NASD, (ii) fees and expenses incurred in connection
with compliance with state securities or blue sky laws (including
reasonable fees and disbursements of counsel for any underwriters or
Holders in connection with the blue sky qualification of any of the
Exchange Notes or Registrable Securities) and compliance with the
rules of the NASD, (iii) expenses of any Persons in preparing or
assisting in preparing, printing and distributing any Registration
Statement, any Prospectus and any amendments or supplements thereto,
and in preparing or assisting in preparing, printing and distributing
any underwriting agreements, securities sales agreements and other
documents relating to the performance of and compliance with the
obligations under this Agreement, (iv) rating agency fees, (v) fees
and disbursements of counsel for and independent certified public
accountants of the Company, including the expenses of any "cold
comfort" letters required by or incident to such performance and
compliance, (vi) fees and expenses of the Trustee, and any exchange
agent or custodian, (vii) fees and expenses incurred in
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connection with the listing, if any, of any of the Registrable
Securities on any securities exchange or exchanges, and (viii) the
reasonable fees and expenses of any special experts retained by the
Company in connection with any Registration Statement. The term
"Registration Expenses" shall not include fees of counsel to any
underwriters or the Holders (other than the fees described in clauses
(i) and (ii) above), underwriting discounts and commissions and
transfer taxes, if any, relating to the sale or disposition of
Registrable Securities by a Holder pursuant to a Shelf Registration
Statement.
"Registration Statement" shall mean any registration statement
of the Company relating to the Exchange Notes or Registrable
Securities pursuant to the provisions of this Agreement, and all
amendments and supplements to any such registration statement,
including post-effective amendments, in each case including the
Prospectus contained therein, all exhibits thereto and all material
incorporated by reference therein.
"Shelf Registration" shall mean a registration effected
pursuant to Section 2(b) hereof.
"Shelf Registration Statement" shall mean a "shelf"
registration statement of the Company pursuant to the provisions of
Section 2(b) of this Agreement which covers all of the Registrable
Securities, on an appropriate form under Rule 415 under the Act, or
any similar rule that may be adopted by the Commission, and all
amendments and supplements to such registration statement, including
post-effective amendments, in each case including the Prospectus
contained therein, all exhibits thereto and all material incorporated
by reference therein.
"TIA" shall mean the Trust Indenture Act of 1939, as amended.
"Trustee" shall mean the trustee under the Indenture.
2. Registration Under the Act.
(a) Exchange Offer. To the extent not prohibited by any
applicable law or applicable interpretation of the staff of the Commission, the
Company shall, for the benefit of the Holders, at the Company's cost, use its
best efforts to cause to be filed with the Commission an Exchange Offer
Registration Statement on or prior to 30 days after the Closing Date on an
appropriate form under the Act covering the offer by the Company to the Holders
to exchange all of the Registrable Securities (other than Private Exchange
Notes) for a like aggregate principal amount of Exchange Notes, to cause such
Exchange Offer Registration Statement to be declared effective under the Act by
the Commission on or prior to 120 days after the Closing
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Date, to cause such Registration Statement to remain effective until the
closing of the Exchange Offer and to cause the Exchange Offer to be consummated
on or prior to 45 days after the date on which the Exchange Offer Registration
Statement was declared effective under the Act by the Commission. The Exchange
Notes will be issued under the Indenture. Upon the effectiveness of the
Exchange Offer Registration Statement, the Company shall promptly commence the
Exchange Offer, it being the objective of such Exchange Offer to enable each
Holder (other than Participating Broker- Dealers (as defined in Section 3(t)
hereof)) eligible and electing to exchange Registrable Securities for Exchange
Notes (assuming that such Holder is not an affiliate of the Company within the
meaning of Rule 405 under the Act, acquires the Exchange Notes in the ordinary
course of such Holder's business and has no arrangements or understandings with
any Person to participate in the Exchange Offer for the purpose of distributing
the Exchange Notes) to transfer such Exchange Notes from and after their
receipt without any limitations or restrictions under the Act or under state
securities or blue sky laws.
In connection with the Exchange Offer, the Company shall:
(i) mail to each Holder a copy of the Prospectus
forming part of the Exchange Offer Registration Statement,
together with an appropriate letter of transmittal and related
documents;
(ii) keep the Exchange Offer open for acceptance for a
period of not less than 30 days after the date notice thereof is
mailed to the Holders, or longer if required by applicable law
(such period being referred to herein as the "Exchange Period");
(iii) utilize the services of the Depository for the
Exchange Offer;
(iv) permit Holders to withdraw tendered Notes at any
time prior to the close of business, New York City time, on the
last business day of the Exchange Period, by sending to the
institution specified in the notice a telegram, telex, facsimile
transmission or letter setting forth the name of such Holder, the
principal amount of Notes delivered for exchange, and a statement
that such Holder is withdrawing its election to have such Notes
exchanged;
(v) notify each Holder that any Note not tendered
will remain outstanding and continue to accrue interest, but will
not retain any rights under this Agreement (except in the case of
the Initial Purchaser and Participating Broker-Dealers as provided
herein); and
(vi) otherwise comply in all respects with all
applicable laws relating to the Exchange Offer.
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If, prior to consummation of the Exchange Offer, the
Initial Purchaser holds any Notes acquired by it and having the status of an
unsold allotment in the initial distribution, the Company upon the request of
the Initial Purchaser shall, simultaneously with the delivery of the Exchange
Notes in the Exchange Offer, issue and deliver to the Initial Purchaser in
exchange (the "Private Exchange") for Notes held by the Initial Purchaser a
like principal amount of debt securities of the Company that are identical
(except that such securities shall bear appropriate transfer restrictions) to
the Exchange Notes (the "Private Exchange Notes") and which are issued pursuant
to the Indenture (which will provide that the Exchange Notes will not be
subject to the transfer restrictions set forth in the Indenture and that the
Exchange Notes, the Private Exchange Notes and the Notes will vote and consent
together on all matters as one class and that none of the Exchange Notes, the
Private Exchange Notes or the Notes will have the right to vote or consent as a
separate class on any matter). The Private Exchange Notes shall be of the same
series as and shall bear the same CUSIP number as the Exchange Notes.
As soon as practicable after the close of the Exchange
Offer or the Private Exchange, as the case may be, the Company shall:
(i) accept for exchange all Notes or portions thereof
duly tendered and not validly withdrawn pursuant to the Exchange
Offer;
(ii) accept for exchange all Notes or portions thereof
duly tendered pursuant to the Private Exchange; and
(iii) 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, and cause the Trustee to
promptly authenticate and deliver to each Holder, a new Exchange
Note or Private Exchange Note, as the case may be, equal in
principal amount to the principal amount of the Notes surrendered
by such Holder.
To the extent not prohibited by applicable law or any
applicable interpretation of the staff of the Commission, the Company shall use
its best efforts to complete the Exchange Offer as provided above, and shall
comply with all applicable requirements of the Act, the Exchange Act and other
applicable laws in connection with the Exchange Offer. The Exchange Offer
shall not be subject to any condition, other than that (i) the Exchange Offer
does not violate any applicable law or interpretation of the staff of the
Commission, (ii) no action or proceeding has been instituted or threatened in
any court or by or before any governmental agency with respect to the Exchange
Offer which, in the reasonable judgment of the Company, might impair the
ability of the Company to proceed with the Exchange Offer, (iii) there has not
been any material change, or development involving a prospective
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material change, in the business or financial affairs of the Company or any of
its subsidiaries which, in the reasonable judgment of the Company, would
materially impair the Company's ability to consummate the Exchange Offer or
have a material adverse effect on the Company if the Exchange Offer is
consummated, (iv) there has not been proposed, adopted, or enacted any law,
statute, rule or regulation which, in the reasonable judgment of the Company,
might materially impair the ability of the Company to proceed with the Exchange
Offer or have a material adverse effect on the Company if the Exchange Offer is
consummated or (v) all governmental approvals which the Company shall
reasonably deem necessary for the consummation of the Exchange Offer as
contemplated shall have been obtained. Each Holder of Registrable Securities
who wishes to exchange such Registrable Securities for Exchange Notes in the
Exchange Offer will be required to make certain customary representations in
connection therewith, including representations that such Holder is not an
affiliate of the Company within the meaning of Rule 405 under the Act, that any
Exchange Notes to be received by it will be acquired in the ordinary course of
business and that at the time of the commencement of the Exchange Offer it had
no arrangement with any Person to participate in the distribution (within the
meaning of the Act) of the Exchange Notes and will be required to make such
other representations as may be necessary under applicable Commission rules,
regulations or interpretations to render available the use of Form S-4 or any
other appropriate form under the Act. The Company shall inform the Initial
Purchaser, after consultation with the Trustee and the Initial Purchaser, of
the names and addresses of the Holders to whom the Exchange Offer is made, and
the Initial Purchaser shall have the right to contact such Holders and
otherwise facilitate the tender of Registrable Securities in the Exchange
Offer.
In the event that the Company is unable to consummate the
Exchange Offer due to any event listed in clauses (i) through (v) in the
paragraph immediately above, the Company shall not be deemed to have breached
any covenant under this Section 2(a).
Upon consummation of the Exchange Offer in accordance with
this Section 2(a), the provisions of this Agreement shall continue to apply,
mutatis mutandis, solely with respect to Registrable Securities that are
Private Exchange Notes and Exchange Notes held by Participating Broker-Dealers,
and the Company shall have no further obligation to register Registrable
Securities (other than Private Exchange Notes) pursuant to Section 2(b) of this
Agreement.
(b) Shelf Registration. In the event that (i) the
Exchange Offer Registration provided in Section 2(a) above is not available to
any Holder or may not be consummated as soon as practicable after the last day
of the Exchange Period because, in either case, it would violate applicable
securities laws or because the applicable interpretations of the staff of the
Commission would not permit the
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Company to effect the Exchange Offer, or (ii) the Exchange Offer is not for any
other reason consummated within 180 days of the Closing Date, the Company
shall, at its cost, cause to be filed with the Commission as promptly as
practicable after such determination or date, as the case may be, and, in any
event, on or prior to 30 days thereafter, a Shelf Registration Statement
providing for the sale by the Holders of all of the Registrable Securities, and
shall use its best efforts to cause such Shelf Registration Statement declared
effective by the Commission on or prior to 90 days after such determination or
date. No Holder of Registrable Securities may include any of its Registrable
Securities in any Shelf Registration pursuant to this Agreement unless and
until such Holder furnishes to the Company in writing, within 15 days after
receipt of a request therefor, such information as the Company may, after
conferring with counsel with regard to information relating to Holders that
would be required by the Commission to be included in such Shelf Registration
Statement or Prospectus included therein, reasonably request for inclusion in
any Shelf Registration Statement or Prospectus included therein. Each Holder
as to which any Shelf Registration is being effected agrees to furnish promptly
to the Company all information required to be disclosed in the applicable Shelf
Registration Statement or Prospectus included therein by the rules and
regulations of the Commission applicable to the Shelf Registration Statement in
order to make the information previously furnished to the Company by such
Holder not materially misleading.
The Company agrees, subject to applicable law or
applicable interpretation of the staff of the Commission, to use its reasonable
best efforts to keep the Shelf Registration Statement continuously effective,
supplemented and amended under the Act for a period ending on the earlier of
the date three years from the Closing Date (subject to extension pursuant to
the last paragraph of Section 3) or when all of the Registrable Securities
covered by the Shelf Registration Statement have been sold pursuant to the
Shelf Registration Statement or cease to be outstanding (the "Effectiveness
Period"). The Company shall not permit any securities other than Registrable
Securities to be included in the Shelf Registration. The Company will, in the
event a Shelf Registration Statement is declared effective, provide to each
Holder copies of the prospectus which is a part of the Shelf Registration
Statement, notify each such Holder when the Shelf Registration Statement has
become effective and take certain other actions as are customary to permit
unrestricted resales of the Registrable Securities covered by the Shelf
Registration Statement. The Company further agrees, if necessary, to use its
reasonable best efforts to supplement or amend the Shelf Registration
Statement, if required by the Act or the rules, regulations or instructions
applicable to the registration form used by the Company for such Shelf
Registration Statement or by any other rules and regulations thereunder for
shelf registrations, or if reasonably requested by the Majority Holders, and
the Company agrees to furnish to the Holders copies of any such supplement or
amendment promptly after its being used or filed with the Commission.
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(c) Expenses. The Company shall pay all Registration
Expenses in connection with registrations pursuant to Section 2(a) or 2(b).
Each Holder shall pay all expenses of its counsel (other than the fees
described in clauses (i) and (ii) of the definition of "Registration
Expenses"), underwriting discounts and commissions and transfer taxes, if any,
relating to the sale or disposition of such Holder's Registrable Securities
pursuant to the Shelf Registration Statement.
(d) Effective Registration Statement. An Exchange
Offer Registration Statement pursuant to Section 2(a) hereof or a Shelf
Registration Statement pursuant to Section 2(b) hereof will not be deemed to
have become effective unless it has been declared effective by the Commission;
provided, however, that if, after it has been declared effective, the offering
of Registrable Securities pursuant to a Shelf Registration Statement is
interfered with by any stop order, injunction or other order or requirement of
the Commission or any other governmental agency or court, such Registration
Statement will be deemed not to have been effective during the period of such
interference, until the offering of Registrable Securities pursuant to such
Registration Statement may legally resume.
(e) Liquidated Damages. In the event that an
Exchange Offer Registration Statement has not been filed with the Commission on
or prior to 30 days after the Closing Date, additional interest payable by the
Company as liquidated damages ("Liquidated Damages") will accrue on the Notes
from and including the 31st day after the Closing Date until but excluding the
date such Exchange Offer Registration Statement is filed. In addition, if on
or prior to 120 days after the Closing Date, such Exchange Offer Registration
Statement is not declared effective under the Act by the Commission, Liquidated
Damages will accrue on the Notes from and including the 121st day after the
Closing Date until but excluding the date such Exchange Offer Registration
Statement is declared effective. Further, if on or prior to 45 days after the
date specified for effectiveness of the Exchange Offer Registration Statement
the Exchange Offer is not consummated, Liquidated Damages will accrue on the
Notes from and including the 46th day after the date specified for
effectiveness of the Exchange Offer Registration Statement, but excluding, the
consummation of the Exchange Offer. If applicable law or interpretations of
the staff of the Commission prohibit a Holder from participating in the
Exchange Offer or if for any reason the Exchange Offer is not consummated
within 180 days of the Closing Date and if a Shelf Registration Statement is
not filed or declared effective within the time periods provided by Section
2(b) hereof for such filing or declaration, Liquidated Damages will accrue on
the Notes (other than those exchanged in the Exchange Offer) or the Private
Exchange Notes, as the case may be, from and including the day immediately
following such default until but excluding the effective date of the Shelf
Registration Statement. Further, if the Shelf Registration Statement or the
Exchange Offer Registration Statement is declared effective but thereafter
ceases to be effective or usable during the time periods specified in this
Agreement, Liquidated Damages will
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accrue on the Notes (other than those exchanged in the Exchange Offer) or the
Private Exchange Notes, as the case may be, from and including the day
immediately following such default until but excluding the date such
Registration Statement is declared effective. In each case, such Liquidated
Damages will be payable in cash semiannually in arrears, with the first
semiannual payment due on the first interest payment date in respect of the
Notes (or the Private Exchange Notes) following the date from which Liquidated
Damages begin to accrue, and will accrue, under each circumstance set forth
above at a rate per annum equal to an additional one half of one percent
(0.50%) of the principal amount of the Notes (or the Private Exchange Notes)
upon the occurrence of each such circumstance, which rate will increase by one
half of one percent (0.50%) for each 90-day period that such Liquidated Damages
continues to accrue under any circumstance, with an aggregate maximum increase
in the interest rate per annum equal to two percent (2.00%).
Upon the filing of the Exchange Offer Registration
Statement, the effectiveness of the Exchange Offer Registration Statement, or
the consummation of the Exchange Offer, as the case may be, the interest rate
borne by the Notes will be reduced by the full amount of any such increase to
the extent that such increase related to the failure of any such event to have
occurred. Upon the effectiveness of a Shelf Registration Statement, the
interest rate borne by the Notes (and the Private Exchange Notes) shall be
reduced, from and as of the date of such effectiveness, to the original
interest rate of the Notes unless and until increased as described above.
Notwithstanding the foregoing, the Company (i) shall not be required to amend
or supplement the Shelf Registration Statement, any related prospectus or any
document incorporated therein by reference and (ii) may suspend the
effectiveness of any such Shelf Registration Statement in the event that, and
for a period not to exceed, for so long as this Agreement is in effect, an
aggregate of 90 days in any one calendar year if (A) an event occurs and is
continuing as a result of which the Shelf Registration Statement, any related
prospectus or any document incorporated therein by reference as then amended or
supplemented 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 (B) the Company
determines in its good faith judgment that the disclosure of such event at such
time would have a material adverse effect on the business, operations or
prospects of the Company; provided that any such suspension shall not relieve
the Company from its obligation to pay Liquidated Damages.
The Company shall notify the Trustee within three business
days after each and every date on which an event occurs in respect of which
Liquidated Damages is required to be paid (an "Event Date"). Liquidated
Damages shall be paid by depositing with the Trustee, in trust, for the benefit
of the Holders of Notes, Exchange Notes or Private Exchange Notes, as the case
may be, on or before the applicable semiannual interest payment date,
immediately available funds in sums
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sufficient to pay the Liquidated Damages then due. The Liquidated Damages due
shall be payable on each interest payment date to the record Holder of Notes
entitled to receive the interest payment to be paid on such date as set forth
in the Indenture. Each obligation to pay Liquidated Damages shall be deemed to
accrue from and including the day following the applicable Event Date.
(f) Specific Enforcement. Without limiting the
remedies available to the Initial Purchaser and the Holders, the Company
acknowledges that any failure by the Company to comply with its obligations
under Section 2(a) and Section 2(b) hereof would result in material irreparable
injury to the Initial Purchaser or the Holders for which there is no adequate
remedy at law, that it would not be possible to measure damages for such
injuries precisely and that, in the event of any such failure, the Initial
Purchaser or any Holder may obtain such relief as may be required to
specifically enforce the Company's obligations under Section 2(a) and Section
2(b) hereof.
3. Registration Procedures. In connection with the
obligations of the Company with respect to the Registration Statements pursuant
to Sections 2(a) and 2(b) hereof, the Company shall:
(a) prepare and file with the Commission a Registration
Statement or Registration Statements as prescribed by Sections
2(a) and 2(b) within the relevant time periods specified in
Section 2 hereof on the appropriate form under the Act, which form
(i) shall be selected by the Company, (ii) shall, in the case of a
Shelf Registration, be available for the sale of the Registrable
Securities by the selling Holders and (iii) shall comply as to
form in all material respects with the requirements of the
applicable form and include or incorporate by reference all
financial statements required by the Commission to be filed
therewith, and the Company shall use its best efforts to cause
such Registration Statement to become effective and remain
effective in accordance with Section 2; provided, however, that if
(1) such filing is pursuant to Section 2(b), or (2) a Prospectus
contained in an Exchange Offer Registration Statement filed
pursuant to Section 2(a) is required to be delivered under the Act
by any Participating Broker-Dealer who seeks to sell Exchange
Notes, before filing any Registration Statement or Prospectus or
any amendments or supplements thereto, the Company, if requested,
shall furnish to and afford the Holders and each such
Participating Broker-Dealer, as the case may be, covered by such
Registration Statement, their counsel and the managing
underwriters, if any, a reasonable opportunity to review copies of
all such documents (including copies of any documents to be
incorporated by reference therein and all exhibits thereto)
proposed to be filed at least five business days prior to such
filing. The Company shall not file any Registration Statement or
Prospectus or any amendments or supplements thereto in respect of
which the
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Holders, pursuant to this Agreement, must be afforded an
opportunity to review prior to the filing of such document, if the
Majority Holders or such Participating Broker-Dealer, as the case
may be, their counsel or the managing underwriters, if any, shall
reasonably object;
(b) subject to Section 3(a) hereof, prepare and file
with the Commission such amendments and post-effective amendments
to each Registration Statement as may be necessary to keep such
Registration Statement effective for the Effectiveness Period or
the Applicable Period, as the case may be, and cause each
Prospectus to be supplemented by any required prospectus
supplement and as so supplemented to be filed pursuant to Rule 424
(or any similar provision then in force) under the Act, and comply
with the provisions of the Act, the Exchange Act and the rules and
regulations promulgated thereunder applicable to it with respect
to the disposition of all securities covered by each Registration
Statement during the Effectiveness Period or the Applicable
Period, as the case may be, in accordance with the intended method
or methods of distribution by the selling Holders thereof
described in this Agreement (including sales by any Participating
Broker-Dealer);
(c) in the case of a Shelf Registration, (i) notify
each Holder, at least five business days prior to filing, that a
Shelf Registration Statement with respect to the Registrable
Securities is being filed and advising such Holder that the
distribution of Registrable Securities will be made in accordance
with the method selected by the Majority Holders, (ii) furnish to
each Holder and to each underwriter of an underwritten offering of
Registrable Securities, if any, without charge, as many copies of
each Prospectus, including each preliminary Prospectus, and any
amendment or supplement thereto and such other documents as such
Holder or underwriter may reasonably request, in order to
facilitate the public sale or other disposition of the Registrable
Securities, and (iii) subject to the last paragraph of this
Section 3, consent to the use of the Prospectus or any amendment
or supplement thereto by each of the selling Holders in connection
with the offering and sale of the Registrable Securities covered
by the Prospectus or any amendment or supplement thereto, provided
that such use complies with all applicable laws and regulations;
(d) use its best efforts to register or qualify the
Registrable Securities under all applicable state securities or
"blue sky" laws of such jurisdictions as any Holder of Registrable
Securities covered by a Registration Statement and each
underwriter of an underwritten offering of Registrable Securities
shall reasonably request by the time the applicable Registration
Statement is declared effective by the Commission, and do any and
all other acts and things which may be reasonably necessary or
advisable to enable such
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Holder and underwriter to consummate the disposition in each such
jurisdiction of such Registrable Securities owned by such Holder;
provided, however, that the Company shall not be required to (i)
qualify as a foreign partnership or foreign corporation or as a
dealer in securities in any jurisdiction where it would not
otherwise be required to qualify but for this Section 3(d), (ii)
file any general consent to service of process in any jurisdiction
where it would not otherwise be subject to such service of process
or (iii) subject itself to taxation in any such jurisdiction if it
is not then so subject;
(e) in the case of (A) a Shelf Registration or (B)
Participating Broker-Dealers who have notified the Company that
they will be utilizing the Prospectus contained in the Exchange
Offer Registration Statement as provided in Section 3(t) hereof,
are seeking to sell Exchange Notes and are required to deliver
Prospectuses, notify each Holder, or such Participating
Broker-Dealers, as the case may be, their counsel and the managing
underwriters, if any, promptly and, if requested by such Holder or
Participating Broker-Dealer, confirm such notice in writing (i)
when a Registration Statement has become effective and when any
post-effective amendments and supplements thereto become
effective, (ii) of any request by the Commission or any state
securities authority for amendments and supplements to a
Registration Statement or Prospectus or for additional information
after the Registration Statement has become effective, (iii) of
the issuance by the Commission or any state securities authority
of any stop order suspending the effectiveness of a Registration
Statement or the initiation of any proceedings for that purpose,
(iv) in the case of a Shelf Registration, if, between the
effective date of a Registration Statement and the closing of any
sale of Registrable Securities covered thereby, the
representations and warranties of the Company contained in any
underwriting agreement, securities sales agreement or other
similar agreement, if any, relating to such offering cease to be
true and correct in all material respects, (v) if the Company
receives any notification with respect to the suspension of the
qualification of the Registrable Securities or the Exchange Notes
to be sold by any Participating Broker-Dealer for offer or sale in
any jurisdiction or the initiation of any proceeding for such
purpose, (vi) of the happening of any event or the failure of any
event to occur or the discovery of any facts or otherwise, during
the period a Shelf Registration Statement is effective or the
Applicable Period, as the case may be, which makes any statement
made in the Shelf Registration Statement, the Exchange Offer
Registration Statement or any related Prospectus untrue in any
material respect or which causes such Registration Statement or
Prospectus, as the case may be, to omit to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading and (vii)
the Company's reasonable determination that a post-effective
amendment to the Registration Statement would be appropriate;
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(f) make every effort to obtain the withdrawal of any
order suspending the effectiveness of a Registration Statement at
the earliest possible moment;
(g) in the case of a Shelf Registration, furnish to
each Holder, upon request and without charge, at least one
conformed copy of each Registration Statement and any
post-effective amendment thereto (without documents incorporated
therein by reference or exhibits thereto, unless requested);
(h) in the case of a Shelf Registration, cooperate
with the selling Holders to facilitate the timely preparation and
delivery of certificates, if any, representing Registrable
Securities to be sold, which certificates shall not bear any
restrictive legends and shall be in a form eligible for deposit
with the Depository; and cause such Registrable Securities to be
in such denominations (consistent with the provisions of the
Indenture) and registered in such names as the selling Holders or
the managing underwriters may reasonably request at least two
business days prior to the closing of any sale of Registrable
Securities;
(i) subject to Section 3(a) hereof and the second
paragraph of Section 2(e) hereof, in the case of a Shelf
Registration or an Exchange Offer Registration, upon the
occurrence of any circumstance contemplated by Section 3(e)(ii),
3(e)(iii), 3(e)(iv), 3(e)(v), 3(e)(vi) or 3(e)(vii) hereof, use
its best efforts to prepare a supplement or post-effective
amendment to the Registration Statement and the related Prospectus
or any document incorporated therein by reference or file any
other required document so that, as thereafter delivered to the
purchasers of the Registrable Securities, such Prospectus will not
contain any untrue statement of a material fact or omit to state a
material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not
misleading. The Company agrees to notify each Holder to suspend
use of the Prospectus as promptly as practicable after the
occurrence of any such circumstance, and each Holder hereby agrees
to suspend use of the Prospectus until the Company has amended or
supplemented the Prospectus to correct such misstatement or
omission;
(j) in the case of a Shelf Registration, furnish to
each Holder of Registrable Securities, upon request and without
charge, a reasonable number of copies of any document which is
incorporated by reference into or is an exhibit to a Registration
Statement or a Prospectus after the initial filing of a
Registration Statement;
(k) obtain a CUSIP number for all Exchange Notes or
Registrable Securities, as the case may be, not later than the
effective date of a
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Registration Statement, and provide the Trustee with printed
certificates for the Exchange Notes or the Registrable Securities,
as the case may be, in a form eligible for deposit with the
Depository;
(l) cause the Indenture to be qualified under the TIA
in connection with the registration of the Exchange Notes or
Registrable Securities, as the case may be, cooperate with the
Trustee and the Holders to effect such changes to the Indenture as
may be required for the Indenture to be so qualified in accordance
with the terms of the TIA and execute, and use its best efforts to
cause the Trustee to execute, all documents as may be required to
effect such changes, and all other forms and documents required to
be filed with the Commission to enable the Indenture to be so
qualified in a timely manner;
(m) in the case of a Shelf Registration, enter into
such agreements (including underwriting agreements) as are
customary in underwritten public offerings and take all such other
appropriate actions as are reasonably requested in order to
expedite or facilitate the registration or the disposition of such
Registrable Securities, and in such connection, whether or not an
underwriting agreement is entered into and whether or not the
registration is an underwritten registration: (i) make such
representations and warranties to Holders of such Registrable
Securities and the underwriters (if any), with respect to the
business of the Company and its subsidiaries and the Registration
Statement, the Prospectus and all documents, if any, incorporated
or deemed to be incorporated by reference therein, in each case,
as are customarily made by issuers to underwriters in underwritten
public offerings, and confirm the same if and when reasonably
requested; (ii) obtain customary opinions of counsel to the
Company and updates thereof in form and substance reasonably
satisfactory to the managing underwriters (if any) and the Holders
of a majority in principal amount of the Registrable Securities
being sold, addressed to each selling Holder and the underwriters
(if any) covering the matters customarily covered in opinions
requested in underwritten public offerings and such other matters
as may be reasonably requested by such Holders and underwriters;
(iii) obtain "cold comfort" letters and updates thereof in form
and substance reasonably satisfactory to the managing underwriters
from the independent certified public accountants of the Company
(and, if necessary, any other independent certified public
accountants of any subsidiary of the Company or of any business
acquired or to be acquired by the Company for which financial
statements and financial data are, or are required to be, included
in the Registration Statement), addressed to the selling Holders
of Registrable Securities and to each of the underwriters, such
letters to be in customary form and covering matters of the type
customarily covered in "cold comfort" letters in connection with
underwritten public offerings; and
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17
(iv) if an underwriting agreement is entered into, cause the same
to contain indemnification provisions and procedures no less
favorable than those set forth in Section 4 hereof (or such other
provisions and procedures acceptable to Holders of a majority in
aggregate principal amount of Registrable Securities covered by
such Registration Statement and the managing underwriters or
agents) with respect to all parties to be indemnified pursuant to
said Section. The above shall be done at each closing under such
underwriting agreement, or as and to the extent required
thereunder;
(n) if (A) a Shelf Registration is filed pursuant to
Section 2(b) or (B) a Prospectus contained in an Exchange Offer
Registration Statement filed pursuant to Section 2(a) is required
to be delivered under the Act by any Participating Broker-Dealer
who seeks to sell Exchange Notes during the Applicable Period,
make available for inspection by any selling Holder of such
Registrable Securities being sold, or each such Participating
Broker-Dealer, as the case may be, any underwriter participating
in any such disposition of Registrable Securities, if any, and any
attorney, accountant or other agent retained by any such selling
Holder or each such Participating Broker-Dealer, as the case may
be, or underwriter (collectively, the "Inspectors"), at the
offices where normally kept, during reasonable business hours, all
financial and other records, pertinent corporate documents and
properties of the Company and its subsidiaries (collectively, the
"Records") as shall be reasonably necessary to enable them to
exercise any applicable due diligence responsibilities, and cause
the officers, directors and employees of the Company and its
subsidiaries to supply all information in each case reasonably
requested by any such Inspector in connection with such
Registration Statement. Records which the Company determines, in
good faith, to be confidential and as to which they notify the
Inspectors are confidential shall not be disclosed by the
Inspectors unless, after prior consultation with the Company, (i)
the disclosure of such Records is necessary to avoid or correct a
material misstatement or omission in such Registration Statement,
(ii) the release of such Records is ordered pursuant to an
effective subpoena or other order from a court of competent
jurisdiction or (iii) the information in such Records has been
made generally available to the public, other than as a result of
a breach of confidentiality or secrecy to the Company. Each
selling Holder of such Registrable Securities and each such
Participating Broker-Dealer will be required to agree that
information obtained by it as a result of such inspections shall
be deemed confidential and shall not be used by it as the basis
for any market transactions in the securities of the Company
unless and until such is made generally available to the public,
other than as a result of a breach of confidentiality or secrecy
to the Company. Each selling Holder of such Registrable
Securities and each such Participating Broker-Dealer will be
required to further agree that it will, upon learning that
disclosure of such
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Records is sought in a court of competent jurisdiction or is
otherwise required in the opinion of such Participating
Broker-Dealer, give notice to the Company and allow the Company at
its expense to undertake appropriate action to prevent disclosure
of the Records deemed confidential;
(o) comply with all applicable rules and regulations
of the Commission and, as soon as reasonably practicable, make
generally available to the Holders earnings statements of the
Company covering at least 12 months satisfying the provisions of
Section 11(a) of the Act and Rule 158 thereunder (or any similar
rule promulgated under the Act);
(p) upon consummation of an Exchange Offer or a
Private Exchange, obtain an opinion of counsel to the Company
addressed to the Trustee for the benefit of all Holders of
Registrable Securities participating in the Exchange Offer or the
Private Exchange, as the case may be, and which includes an
opinion that (i) the Company has duly authorized, executed and
delivered the Exchange Notes and Private Exchange Notes and the
Indenture, as the case may be, and (ii) each of the Exchange Notes
or the Private Exchange Notes and the Indenture, as the case may
be, constitute a legal, valid and binding obligation of the
Company, enforceable against the Company in accordance with its
respective terms (in each case, with customary exceptions);
(q) if an Exchange Offer or a Private Exchange is to
be consummated, upon delivery of the Registrable Securities by
Holders to the Company (or to such other Person as directed by the
Company) in exchange for the Exchange Notes or the Private
Exchange Notes, as the case may be, the Company shall xxxx, or
cause to be marked, on such Registrable Securities delivered by
such Holders that such Registrable Securities are being cancelled
in exchange for the Exchange Notes or the Private Exchange Notes,
as the case may be; in no event shall such Registrable Securities
be marked as paid or otherwise satisfied;
(r) cooperate with each seller of Registrable
Securities covered by any Registration Statement and each
underwriter, if any, participating in the disposition of such
Registrable Securities and their respective counsel in connection
with any filings required to be made with the NASD;
(s) use its best efforts to take all other steps
necessary to effect the registration of the Registrable Securities
covered by a Registration Statement contemplated hereby;
(t) (A) in the case of the Exchange Offer
Registration Statement (i) include in the Exchange Offer
Registration Statement a section entitled
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"Plan of Distribution," which section shall be reasonably
acceptable to the Initial Purchaser or another representative of
the Participating Broker-Dealers, and which shall contain a
summary statement of the positions taken or policies made by the
staff of the Commission with respect to the potential
"underwriter" status of any broker-dealer (a "Participating
Broker-Dealer") that holds Registrable Securities acquired for its
own account as a result of market-making activities or other
trading activities and that will be the beneficial owner (as
defined in Rule 13d-3 under the Exchange Act) of Exchange Notes to
be received by such broker-dealer in the Exchange Offer, whether
such positions or policies have been publicly disseminated by the
staff of the Commission or such positions or policies, in the
reasonable judgment of the Initial Purchaser or such other
representative, represent the prevailing views of the staff of the
Commission, including a statement that any such broker-dealer who
receives Exchange Notes for Registrable Securities pursuant to the
Exchange Offer may be deemed a statutory underwriter and must
deliver a prospectus meeting the requirements of the Act in
connection with any resale of such Exchange Notes, (ii) furnish to
each Participating Broker-Dealer who has delivered to the Company
the notice referred to in Section 3(e), without charge, as many
copies of each Prospectus included in the Exchange Offer
Registration Statement, including any preliminary prospectus, and
any amendment or supplement thereto, as such Participating
Broker-Dealer may reasonably request, (iii) subject to the last
paragraph of this Section 3, hereby consent to the use of the
Prospectus forming part of the Exchange Offer Registration
Statement or any amendment or supplement thereto, by any Person
subject to the prospectus delivery requirements of the Commission,
including all Participating Broker-Dealers, in connection with the
sale or transfer of the Exchange Notes covered by the Prospectus
or any amendment or supplement thereto, (iv) use its best efforts
to keep the Exchange Offer Registration Statement effective and to
amend and supplement the Prospectus contained therein, in order to
permit such Prospectus to be lawfully delivered by all Persons
subject to the prospectus delivery requirements of the Act for
such period of time as such Persons must comply with such
requirements in order to resell the Exchange Notes (provided,
however, that such period shall not be required to exceed 180
days, or such longer period if extended pursuant to the last
sentence of this Section 3 (the "Applicable Period")), and (v)
include in the transmittal letter or similar documentation to be
executed by an exchange offeree all necessary information for such
offeree to participate in the Exchange Offer;
(B) in the case of any Exchange Offer Registration
Statement, the Company agrees to deliver to the Initial Purchaser
or to another representative of the Participating Broker-Dealers
on behalf of the Participating Broker-Dealers upon consummation of
the Exchange Offer (i) an opinion of counsel
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substantially in the form attached hereto as Exhibit A, (ii) an
Officers' Certificate containing certifications substantially
similar to those set forth in Section 8(d) of the Purchase
Agreement and such additional certifications as are customarily
delivered in a public offering of debt securities, and (iii) a
comfort letter in customary form permitted by Statement of
Auditing Standards No. 72 of the American Institute of Certified
Public Accountants.
The Company may require each seller of Registrable
Securities as to which any registration is being effected to furnish to the
Company such information regarding such seller and the proposed distribution of
such Registrable Securities as the Company may from time to time reasonably
request in writing. The Company may exclude from such registration the
Registrable Securities of any seller who unreasonably fails to furnish such
information within a reasonable time after receiving such request.
In the case of (i) a Shelf Registration Statement or (ii)
Participating Broker-Dealers who have notified the Company that they will be
utilizing the Prospectus contained in the Exchange Offer Registration Statement
as provided in Section 3(t) hereof, are seeking to sell Exchange Notes and are
required to deliver copies of such Prospectus, each Holder agrees that, upon
receipt of any notice from the Company of the happening of any event of the
kind described in Section 3(e)(ii), 3(e)(iii), 3(e)(iv), 3(e)(v), 3(e)(vi) or
3(e)(vii) hereof, such Holder will forthwith discontinue disposition of
Registrable Securities pursuant to a Registration Statement until such Holder's
receipt of the copies of the supplemented or amended Prospectus contemplated by
Section 3(i) hereof or until it is advised in writing by the Company that the
use of the applicable Prospectus may be resumed, and, if so directed by the
Company, such Holder will deliver to the Company (at the Company's expense) all
copies in such Holder's possession, other than permanent file copies then in
such Holder's possession, of the Prospectus covering such Registrable
Securities or Exchange Notes, as the case may be, current at the time of
receipt of such notice. If the Company shall give any such notice to suspend
the disposition of Registrable Securities or Exchange Notes, as the case may
be, pursuant to a Registration Statement as a result of the happening of any
event of the kind described in Section 3(e)(ii), 3(e)(iii), 3(e)(iv), 3(e)(v),
3(e)(vi) or 3(e)(vii) hereof, the Company shall use its best efforts to file
and have declared effective (if an amendment) as soon as practicable an
amendment or supplement to the Registration Statement and shall extend the
period during which such Registration Statement shall be maintained effective
pursuant to this Agreement by the number of days in the period from and
including the date of the giving of such notice to and including the date when
the Company shall have made available to the Holders copies of the supplemented
or amended Prospectus necessary to resume such dispositions or shall have
advised the Holders in writing that the use of the applicable Prospectus may be
resumed.
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4. Indemnification and Contribution. (a) The
Company shall indemnify and hold harmless the Initial Purchaser, each Holder,
each Participating Broker-Dealer, each underwriter who participates in an
offering of Registrable Securities, each of their respective affiliates, each
Person, if any, who controls any of such parties within the meaning of Section
15 of the Act or Section 20 of the Exchange Act, and each of their respective
directors, officers, partners, employees, representatives and agents, to the
fullest extent lawful as follows:
(i) from and against any and all loss, liability,
claim, damage and expense whatsoever, joint or several, as
incurred, arising out of any untrue statement or alleged untrue
statement of a material fact contained in any Registration
Statement or any amendment thereto pursuant to which the offer and
sale of the Registrable Securities or Exchange Notes were
registered under the Act including all documents incorporated
therein by reference, or the omission or alleged omission
therefrom of a material fact required to be stated therein or
necessary to make the statements therein not misleading, or
arising out of any untrue statement or alleged untrue statement of
a material fact contained in any Prospectus or any amendment or
supplement thereto, or the omission or alleged omission therefrom
of a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading;
(ii) from and against any and all loss, liability,
claim, damage and expense whatsoever, joint or several, as
incurred, to the extent of the aggregate amount paid in settlement
of any litigation, or any investigation or proceeding by any court
or governmental agency or body, whether commenced or threatened,
or of any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, if and
only if such settlement is effected with the prior written consent
of the Company; and
(iii) from and against any and all expenses whatsoever
(including reasonable fees and disbursements of counsel chosen by
such Initial Purchaser, Holder, Participating Broker-Dealer or
underwriter (except to the extent otherwise expressly provided in
Section 4(c) hereof)), as incurred, reasonably incurred in
investigating, preparing for or defending against any litigation,
or any investigation or proceeding by any court or governmental
agency or body, whether commenced or threatened, and any amount
paid in settlement thereof, or any other claim whatsoever based
upon any such untrue statement or omission, or any such alleged
untrue statement or omission, to the extent that any such expense
is not paid under subparagraph (i) or (ii) of this Section 4(a);
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provided, however, that this indemnity does not apply to any loss, liability,
claim, damage or expense to the extent arising out of an untrue statement or
omission or alleged untrue statement or omission (i) made solely in reliance
upon and in conformity with written information furnished to the Company by the
Initial Purchaser, such Holder, such Participating Broker-Dealer or any
underwriter in writing expressly for use in the Registration Statement (or any
amendment thereto) or any Prospectus (or any amendment or supplement thereto)
or (ii) contained in any preliminary prospectus or any Prospectus if the
Initial Purchaser, such Holder, such Participating Broker-Dealer or such
underwriter failed to send or deliver a copy of the Prospectus (as then amended
or supplemented if the Company shall have timely furnished any amendments or
supplements thereto) to the Person asserting such losses, liabilities, claims
or damages on or prior to the delivery of written confirmation of any sale of
securities covered thereby to such Person in any case where such delivery is
required by the Act and a court of competent jurisdiction in a judgment not
subject to appeal or final review shall have determined that such Prospectus
(as so amended or supplemented) would have corrected such untrue statement or
omission and the delivery thereof would have eliminated such losses, claims,
damages or liabilities. Any amounts advanced by the Company to an indemnified
party pursuant to this Section 4 as a result of such losses shall be returned
to the Company if it shall be finally judicially determined by such a court in
a judgment not subject to appeal or final review that such indemnified party
was not entitled to indemnification by the Company.
(b) Each Holder agrees, severally and not jointly, to
indemnify and hold harmless the Company, the Initial Purchaser, each
underwriter who participates in an offering of Registrable Securities and the
other selling Holders and each of their respective directors, officers
(including each officer of the Company who signed the Registration Statement),
employees, representatives and agents, and each Person, if any, who controls
the Company, the Initial Purchaser, any underwriter or any other selling Holder
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act,
from and against any and all loss, liability, claim, damage and expense
whatsoever described in the indemnity contained in Section 4(a) hereof, as
reasonably incurred, but only with respect to untrue statements or omissions,
or alleged untrue statements or omissions, made in the Registration Statement
(or any amendment thereto) or any Prospectus (or any amendment or supplement
thereto) solely in reliance upon and in conformity with written information
furnished to the Company by such selling Holder expressly for use in the
Registration Statement (or any amendment thereto) or any such Prospectus (or
any amendment or supplement thereto); provided, however, that, in the case of a
Shelf Registration Statement, no such Holder shall be liable for any claims
hereunder in excess of the amount of net proceeds received by such Holder from
the sale of Registrable Securities pursuant to such Shelf Registration
Statement.
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(c) Each indemnified party shall give prompt notice
to each indemnifying party of any action commenced against it in respect of
which indemnity may be sought hereunder, enclosing a copy of all papers
properly served on such indemnified party (but failure to notify an
indemnifying party shall not relieve such indemnifying party from any liability
hereunder to the extent it is not materially prejudiced as a result thereof and
in any event shall not relieve it from any liability which it may have other
than on account of this indemnity agreement). An indemnifying party may
participate, at its own expense, in the defense of any such action. If an
indemnifying party so elects within a reasonable time after receipt of such
notice, such indemnifying party, jointly with any other indemnifying party, may
assume the defense of such action with counsel chosen by it and reasonably
satisfactory to the indemnified parties defendant in such action; provided,
however, that if any such indemnified party reasonably determines, upon written
advice of counsel, that there may be legal defenses available to such
indemnified party which are different from or in addition to those available to
such indemnifying party or that representation of such indemnifying party and
any indemnified party by the same counsel would present a conflict of interest,
then such indemnifying party or parties shall not so be entitled to assume such
defense. If an indemnifying party is not so entitled to assume the defense of
such action, counsel for such indemnifying party shall be entitled to conduct
the defense of such indemnifying party and counsel for each indemnified party
or parties shall be entitled to conduct the defense of such indemnified party
or parties. If an indemnifying party assumes the defense of an action in
accordance with and as permitted by the provisions of this Section 4(c), such
indemnifying party shall not be liable for any fees and expenses of counsel for
the indemnified parties incurred thereafter in connection with such action. In
no event shall the indemnifying party or parties be liable for the fees and
expenses of more than one counsel for all indemnified parties in connection
with any one action, or separate but similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances. No
indemnifying party shall, without the prior written consent of the indemnified
parties, which consent shall not be unreasonably withheld, settle or compromise
or consent to the entry of any judgment with respect to any litigation, or any
investigation or proceeding by any governmental agency or body, commenced or
threatened, or any claim whatsoever in respect of which indemnification or
contribution could be sought under this Section 4, unless such settlement,
compromise or consent includes an unconditional release of each indemnified
party from all liability arising out of such litigation, investigation,
proceeding or claim and does not include a statement as to or an admission of
fault, culpability or a failure to act by or on behalf of any indemnified
party.
(d) Notwithstanding any payment or payments made by
the Company hereunder, the Company hereby expressly waives subrogation to, and
agrees that it shall not be entitled to be subrogated to, any of the rights of
any indemnified party against the Company or any other right of offset held by
any
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indemnified party for the payment of any amounts owed to any indemnified party
pursuant to this Section 4; provided, however, that if any of the foregoing
provisions of this paragraph are held to be contrary to applicable law or
unenforceable by a court of competent jurisdiction, the Company hereby
expressly agrees that any right of subrogation or contribution that the Company
may have as a result of such applicable law or unenforceability, as the case
may be, shall be subordinate in right of payment to the payment in full in cash
of all amounts owed to any indemnified party pursuant to this Section 4.
(e) If the indemnification provided for in this
Section 4 is for any reason unavailable to or insufficient to hold harmless an
indemnified party in respect of any losses, liabilities, claims, damages or
expenses referred to therein, then each indemnifying party shall contribute to
the aggregate amount of such losses, liabilities, claims, damages and expenses
incurred by such indemnified party, as incurred, (i) in such proportion as is
appropriate to reflect the relative benefits received by the indemnifying party
or parties on the one hand and the indemnified party or parties on the other
hand from the offering of the Notes pursuant to the Purchase Agreement, or (ii)
if the allocation provided by clause (i) is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the indemnifying
party or parties on the one hand and of the indemnified party or parties on the
other hand in connection with the statements or omissions which resulted in
such losses, liabilities, claims, damages or expenses, as well as any other
relevant equitable considerations.
The relative benefits received by the Company on the one
hand and the Initial Purchaser on the other hand in connection with the
offering of the Notes pursuant to the Purchase Agreement shall be deemed to be
in the same respective proportions as the total net proceeds from the offering
of the Notes pursuant to the Purchase Agreement (before deducting expenses)
received by the Company and the total discount received by the Initial
Purchaser bear to the aggregate initial offering price of the Notes.
The relative fault of the Company on the one hand and the
Holders on the other hand shall be determined by reference to, among other
things, whether any such untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Company or by the Holders, and the respective parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission.
The Company and the Holders agree that it would not be
just and equitable if contribution pursuant to this Section 4 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
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referred to above in this Section 4(e). The aggregate amount of losses,
liabilities, claims, damages and expenses incurred by an indemnified party and
referred to above in this Section 4(e) shall be deemed to include any legal or
other expenses reasonably incurred by such indemnified party in investigating,
preparing for or defending against any litigation, or any investigation or
proceeding by any governmental agency or body, commenced or threatened, or any
claim whatsoever based upon any such untrue or alleged untrue statement or
omission or alleged omission.
Notwithstanding the provisions of this Section 4(e), the
Initial Purchaser shall not be required to contribute any amount in excess of
the amount by which the total discount received by the Initial Purchaser in
respect of the purchase price of the Notes purchased by it from the Company
exceeds the amount of any damages which the Initial Purchaser 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.
For purposes of this Section 4(e), each person, if any,
who controls the Initial Purchaser within the meaning of Section 15 of the Act
or Section 20 of the Exchange Act shall have the same rights to contribution as
the Initial Purchaser, and each director of the Company and each officer of the
Company who signed the Registration Statement and each person, if any, who
controls the Company within the meaning of Section 15 of the Act or Section 20
of the Exchange Act shall have the same rights to contribution as the Company.
5. Participation in Underwritten Registrations. No
Holder may participate in any underwritten registration hereunder unless such
Holder (a) agrees to sell such Holder's Registrable Securities on the basis
provided in any customary underwriting arrangements approved by the Persons
entitled hereunder to approve such arrangements and (b) completes and executes
all reasonable questionnaires, powers of attorney, indemnities, underwriting
agreements, lock-up letters and other documents reasonably required in
connection with such underwriting arrangements.
6. Selection of Underwriters. In any underwritten
offering, the underwriter or underwriters and manager or managers that will
administer the offering will be selected by the Holders of a majority in
aggregate principal amount of the Registrable Securities included in such
offering; provided, however, that such underwriters and managers must be
reasonably satisfactory to the Company.
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7. Miscellaneous.
(a) No Inconsistent Agreements. The Company shall
not have entered into nor will the Company on or after the date of this
Agreement enter into any agreement that is inconsistent with the rights granted
to the Holders of Registrable Securities in this Agreement or otherwise
conflicts with the provisions hereof. The Company has not previously entered
into any agreement granting any registration or similar rights with respect to
its securities to any person. 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 other issued and outstanding securities, if
any, under any agreement in effect on the date hereof.
(b) Amendments and Waivers. The provisions of this
Agreement, including the provisions of this sentence, may not be amended,
modified or supplemented, and waivers or consents to departures from the
provisions hereof may not be given, unless the Company has obtained the written
consent of Holders of at least a majority of the then outstanding aggregate
principal amount of the Registrable Securities; provided, however, that no
amendment, modification or supplement or waiver or consent to the departure
with respect to the provisions of Section 4 hereof shall be effective as
against any Holder of Registrable Securities unless consented to in writing by
such Holder of Registrable Securities.
(c) Notices. All notices and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
sent by registered or certified mail, postage prepaid, sent by any national
courier service guaranteeing overnight delivery or transmitted by any standard
form of telecommunication, as follows: (i) if to a Holder, at the most current
address given by such Holder to the Company in accordance with the provisions
of this Section 7(c), which address, with respect to the Initial Purchaser,
shall initially be the address provided for the Initial Purchaser in the
Purchase Agreement; and (ii) if to the Company, at its address as set forth in
the Purchase Agreement, or at such other address provided in accordance with
the provisions of this Section 7(c).
All such notices and communications shall be deemed to
have been duly given at the earlier of: (i) the time of actual receipt by the
addressee; or (ii) the time delivered, if personally delivered, or five
business days after being sent by registered or certified mail, postage
prepaid, if mailed, or when answered back, if telexed, or when transmission is
confirmed, if telecopied, or on the next business day, if timely delivered to a
national courier service guaranteeing overnight delivery.
Copies of all notices, demands, or other communications
shall be concurrently delivered by the Person giving the same to the Trustee at
its address specified in the Indenture.
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(d) Successors and Assigns. This Agreement shall
inure to the benefit of and be binding upon the successors, assigns and
transferees of the Initial Purchaser, including, without limitation and without
the need for an express assignment, subsequent Holders; provided, however, that
nothing herein shall be deemed to permit any assignment, transfer or other
disposition of Registrable Securities in violation of the terms of the Purchase
Agreement or the Indenture. If any transferee of any Holder shall acquire
Registrable Securities, in any manner, whether by operation of law or
otherwise, such Registrable Securities shall be held subject to all of the
terms of this Agreement, and by taking and holding such Registrable Securities,
such Person shall be conclusively deemed to have agreed to be bound by and to
perform all of the terms and provisions of this Agreement and such Person shall
be entitled to receive the benefits hereof.
(e) Third Party Beneficiary. The Holders shall be
third party beneficiaries of the agreements made hereunder between the Company,
on the one hand, and the Initial Purchaser, on the other hand, and the Holders
shall have the right to enforce such agreements directly to the extent they
deem such enforcement necessary or advisable to protect their rights or the
rights of any of the other Holders.
(f) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(g) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED
BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK,
WITHOUT GIVING EFFECT TO ANY PROVISIONS RELATING TO CONFLICTS OF LAWS.
(h) 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.
(i) Notes Held by the Company or its Affiliates.
Whenever the consent or approval of Holders of a specified percentage of
Registrable Securities is required hereunder, Registrable Securities held by
the Company or any affiliate of the Company (as such term is defined in Rule
405 under the Act) shall not be counted in determining whether such consent or
approval was given by the Holders of such required percentage.
(j) Counterparts. This Agreement may be executed in
one or more counterparts and, when so executed, all such counterparts taken
together shall constitute one and the same agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this
Registration Rights Agreement as of the date first written above.
SYNTHETIC INDUSTRIES, INC.
By:
---------------------------
Name:
Title:
Accepted as of the
date first above written:
BEAR, XXXXXXX & CO. INC.
By:
----------------------------
Name:
Title:
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Exhibit A
Form of Opinion of Counsel
1. Each of the Exchange Offer Registration Statement and
the Prospectus (other than the financial statements, notes or schedules thereto
and other financial and statistical data and supplemental schedules included or
referred to therein or omitted therefrom and the Form T-l, as to which such
counsel need express no opinion), complies as to form in all material respects
with the applicable requirements of the Act and the applicable rules and
regulations promulgated under the Act.
2. In the course of such counsel's review and discussion
of the contents of the Exchange Offer Registration Statement and the Prospectus
with certain officers and other representatives of the Company and
representatives of the independent certified public accountants of the Company,
but without independent check or verification or responsibility for the
accuracy, completeness or fairness of the statements contained therein, on the
basis of the foregoing (relying as to materiality to a large extent upon
representations and opinions of officers and other representatives of the
Company), no facts have come to such counsel's attention which cause such
counsel to believe that the Exchange Offer Registration Statement (other than
the financial statements, notes and schedules thereto and other financial and
statistical information contained or referred to therein and the Form T-1, as
to which such counsel need express no belief), at the time the Exchange Offer
Registration Statement became effective, 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 contained therein not misleading, or that
the Prospectus (other than the financial statements, notes and schedules
thereto and other financial and statistical information contained or referred
to therein, as to which such counsel need express no belief) contains any
untrue statement of a material fact or omits to state a material fact necessary
to make the statements contained therein, in the light of the circumstances
under which they were made, not misleading.
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