EXECUTION COPY
--------------
DETAILS HOLDINGS CORP.
$110,000,000
12 1/2% Senior Discount Notes due 2007
EXCHANGE AND REGISTRATION RIGHTS AGREEMENT
------------------------------------------
November 18, 1997
CHASE SECURITIES INC.
000 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Details Holdings Corp., a California corporation ("Holdings"),
--------
proposes to issue and sell to Chase Securities Inc. (the "Initial Purchaser"),
-----------------
upon the terms and subject to the conditions set forth in a purchase agreement
dated November 13, 1997 (the "Purchase Agreement"), $110,000,000 aggregate
------------------
principal amount at maturity of its 12 1/2% Senior Discount Notes due 2007 (the
"Discount Notes"). Capitalized terms used but not defined herein shall have the
--------------
meanings given to such terms in the Purchase Agreement.
As an inducement to the Initial Purchaser to enter into the Purchase
Agreement and in satisfaction of a condition to the obligations of the Initial
Purchaser thereunder, each of Holdings and Details, Inc. ("Details") agrees with
-------
the Initial Purchaser, for the benefit of the holders (including the Initial
Purchaser) of the Discount Notes, the Exchange Discount Notes (as defined
herein) and the Private Exchange Discount Notes (as defined herein)
(collectively, the "Holders"), as follows:
-------
Section 1. Registered Exchange Offer. Holdings shall (i) prepare
-------------------------
and, not later than 90 days following the date of original issuance of the
Discount Notes (the "Issue Date"), file with the Securities and Exchange
----------
Commission (the "Commission") a registration statement (the "Exchange Offer
--------------
Registration Statement") on an appropriate form under the Securities Act with
----------------------
respect to a proposed offer to the Holders of the Discount Notes that are
Transfer
2
Restricted Discount Notes (as defined in Section 3(a) hereof) (the "Registered
----------
Exchange Offer") to issue and deliver to such Holders, in exchange for the
--------------
Transfer Restricted Discount Notes, a like aggregate principal amount of debt
securities of Holdings (the "Exchange Discount Notes") that are identical in all
-----------------------
material respects to the Transfer Restricted Discount Notes, except for the
transfer restrictions relating to the Transfer Restricted Discount Notes, (ii)
use its reasonable best efforts to cause the Exchange Offer Registration
Statement to become effective under the Securities Act no later than 180 days
after the Issue Date and the Registered Exchange Offer to be consummated no
later than 210 days after the Issue Date and (iii) keep the Exchange Offer
Registration Statement effective for not less than 30 days (or longer, if
required by applicable law) after the date on which notice of the Registered
Exchange Offer is mailed to the Holders (such period being called the "Exchange
--------
Offer Registration Period"). The Exchange Discount Notes and the Private
-------------------------
Exchange Discount Notes (as defined below), if any, will be issued under the
Indenture or an indenture (the "Exchange Discount Notes Indenture") between
---------------------------------
Holdings and the Trustee or such other bank or trust company that is reasonably
satisfactory to Holdings and the Initial Purchaser, as trustee (the "Exchange
--------
Discount Notes Trustee"), such indenture to be identical in all material
----------------------
respects to the Indenture, except for the transfer restrictions relating to the
Transfer Restricted Discount Notes (as described above).
Upon the effectiveness of the Exchange Offer Registration Statement,
Holdings shall promptly commence the Registered Exchange Offer, it being the
objective of such Registered Exchange Offer to enable each Holder electing to
exchange Transfer Restricted Discount Notes for Exchange Discount Notes
(assuming that such Holder (a) is not an affiliate of Holdings or an Exchanging
Dealer (as defined herein) not complying with the requirements of the next
sentence, (b) is not the Initial Purchaser with Transfer Restricted Discount
Notes that have the status of an unsold allotment in an initial distribution,
(c) acquires the Exchange Discount Notes in the ordinary course of such Holder's
business and (d) has no arrangements or understandings with any person to
participate in the distribution of the Exchange Discount Notes) and to trade
such Exchange Discount Notes from and after their receipt without any
limitations or restrictions under the Securities Act and without material
restrictions under the securities laws of the several states of the United
States. Holdings, the Initial Purchaser and each Exchanging Dealer acknowledge
that, pursuant to current interpretations by the Commission's staff of Section 5
of the Securities Act, (i) each Holder that is a broker-dealer electing to
exchange Discount Notes, acquired for its own account as a result of market-
making activities or other trading activities, for Exchange Discount Notes (an
"Exchanging Dealer"), is required to deliver a prospectus containing
------------------
substantially the information set forth in Annex A hereto on the cover, in Annex
B hereto in the "Exchange Offer Procedures" section and the "Purpose of the
Exchange Offer" section and in Annex C hereto in the "Plan of Distribution"
section of such prospectus in connection with a sale of any such Exchange
Discount Notes received by such Exchanging Dealer pursuant to the Registered
Exchange Offer and (ii) if the Initial Purchaser elects to sell Private Exchange
Discount Notes acquired in exchange for Transfer Restricted Discount Notes
constituting any portion of an unsold allotment, it is required to deliver a
prospectus containing the information required by Items 507 or 508 of Regulation
S-K under the Securities Act and the Exchange Act ("Regulation S-K").
--------------
3
Upon consummation of the Registered Exchange Offer in accordance with
this Section 1, the provisions of this Agreement shall continue to apply,
mutatis mutandis, solely with respect to Transfer Restricted Discount Notes that
are Private Exchange Discount Notes, Exchange Discount Notes as to which clause
(v) of the first paragraph of Section 2 is applicable and Exchange Discount
Notes held by Exchanging Dealers, and Holdings shall have no further obligations
to register Transfer Restricted Discount Notes (other than Private Exchange
Discount Notes and other than in respect of any Exchange Discount Notes as to
which clause (v) of the first paragraph of Section 2 hereof applies) pursuant to
Section 2 hereof.
If, prior to the consummation of the Registered Exchange Offer, any
Holder holds any Discount Notes acquired by it that have, or that are reasonably
likely to be determined to have, the status of an unsold allotment in the
initial distribution, or any Holder is not entitled to participate in the
Registered Exchange Offer, Holdings shall, upon the request of any such Holder,
simultaneously with the delivery of the Exchange Discount Notes in the
Registered Exchange Offer, issue and deliver to any such Holder, in exchange for
the Discount Notes held by such Holder (the "Private Exchange"), a like
----------------
aggregate principal amount of debt securities of Holdings (the "Private Exchange
----------------
Discount Notes") that are identical in all material respects to the Exchange
--------------
Discount Notes, except for the transfer restrictions relating to such Private
Exchange Discount Notes. The Private Exchange Discount Notes will be issued
under the same indenture as the Exchange Discount Notes, and Holdings shall use
its reasonable best efforts to cause the Private Exchange Discount Notes to bear
the same CUSIP number as the Exchange Discount Notes.
In connection with the Registered Exchange Offer, Holdings shall:
(a) mail to each registered Holder a copy of the prospectus forming
part of the Exchange Offer Registration Statement, together with an
appropriate letter of transmittal and related documents;
(b) keep the Registered Exchange Offer open for not less than 30 days
(or longer, if required by applicable law) after the date on which notice
of the Registered Exchange Offer is mailed to the Holders;
(c) utilize the services of a depositary for the Registered Exchange
Offer with an address in the Borough of Manhattan, The City of New York;
(d) permit Holders to withdraw tendered Transfer Restricted Discount
Notes at any time prior to the close of business, New York City time, on
the last business day on which the Registered Exchange Offer shall remain
open; and
(e) otherwise comply in all respects with all laws that are
applicable to the Registered Exchange Offer.
4
As soon as practicable after the close of the Registered Exchange
Offer and any Private Exchange, as the case may be, Holdings shall:
(a) accept for exchange all Transfer Restricted Discount Notes
tendered and not validly withdrawn pursuant to the Registered Exchange
Offer and the Private Exchange;
(b) deliver to the Trustee for cancellation all Transfer Restricted
Discount Notes so accepted for exchange; and
(c) cause the Trustee or the Exchange Discount Notes Trustee, as the
case may be, promptly to authenticate and deliver to each Holder, Exchange
Discount Notes or Private Exchange Discount Notes, as the case may be,
equal in principal amount to the Transfer Restricted Discount Notes of such
Holder so accepted for exchange.
Holdings shall use its reasonable 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 used by
all persons subject to the prospectus delivery requirements of the Securities
Act for such period of time as such persons must comply with such requirements
in order to resell the Exchange Discount Notes; provided that (i) in the case
--------
where such prospectus and any amendment or supplement thereto must be delivered
by an Exchanging Dealer, such period shall be the lesser of 90 days and the date
on which all Exchanging Dealers have sold all Exchange Discount Notes held by
them and (ii) Holdings shall make such prospectus and any amendment or
supplement thereto available to any broker-dealer for use in connection with any
resale of any Exchange Discount Notes for a period of not less than 90 days
after the consummation of the Registered Exchange Offer.
The Indenture or the Exchange Discount Notes Indenture, as the case
may be, shall provide that the Discount Notes, the Exchange Discount Notes and
the Private Exchange Discount Notes shall vote and consent together on all
matters as one class and that none of the Discount Notes, the Exchange Discount
Notes or the Private Exchange Discount Notes will have the right to vote or
consent as a separate class on any matter.
Interest on each Exchange Discount Note and Private Exchange Discount
Note issued pursuant to the Registered Exchange Offer and in the Private
Exchange will accrue from the last interest payment date on which interest was
paid on the Discount Notes surrendered in exchange therefor or, if no interest
has been paid on the Discount Notes, from the Issue Date.
Each Holder participating in the Registered Exchange Offer shall be
required to represent to Holdings that at the time of the consummation of the
Registered Exchange Offer (i) any Exchange Discount Notes received by such
Holder will be acquired in the ordinary course of business, (ii) such Holder
will have no arrangements or understanding with any person to participate in the
distribution of the Discount Notes or the Exchange Discount Notes within the
meaning of the Securities Act, (iii) such Holder is not an affiliate of Holdings
or, if
5
it is such an affiliate, such Holder will comply with the registration and
prospectus delivery requirements of the Securities Act to the extent applicable,
and (iv) if an Exchanging Dealer, such person shall comply with the prospectus
delivery requirements of the Securities Act.
Notwithstanding any other provisions hereof, Holdings will ensure that
(i) any Exchange Offer Registration Statement and any amendment thereto and any
prospectus forming part thereof and any supplement thereto complies in all
material respects with the Securities Act and the rules and regulations of the
Commission thereunder, (ii) any Exchange Offer Registration Statement and any
amendment thereto does not, when it becomes effective, contain an untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements therein not
misleading and (iii) any prospectus forming part of any Exchange Offer
Registration Statement, and any supplement to such prospectus, does not, as of
the consummation of the Registered Exchange Offer, include an untrue statement
of a material fact or omit to state a material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made, not misleading.
Section 2. Shelf Registration. If (i) because of any change in law
------------------
or applicable interpretations thereof by the Commission's staff, Holdings is not
permitted to effect the Registered Exchange Offer as contemplated by Section 1
hereof, (ii) any Discount Notes validly tendered pursuant to the Exchange Offer
are not exchanged for Exchange Discount Notes within 210 days after the Issue
Date, (iii) the Initial Purchaser so requests with respect to Discount Notes not
eligible to be exchanged for Exchange Discount Notes in the Registered Exchange
Offer, (iv) any applicable law or interpretations do not permit any Holder to
participate in the Registered Exchange Offer, (v) any Holder that participates
in the Registered Exchange Offer does not receive freely transferable Exchange
Discount Notes in exchange for tendered Discount Notes, or (vi) Holdings so
elects, then the following provisions shall apply:
(a) Holdings shall use its reasonable best efforts to file as
promptly as practicable (but in no event more than 30 days after so required or
requested pursuant to this Section 2) with the Commission, and thereafter shall
use its reasonable best efforts to cause to be declared effective, a shelf
registration statement on an appropriate form under the Securities Act relating
to the offer and sale of the Transfer Restricted Discount Notes by such Holders
thereof from time to time in accordance with the methods of distribution set
forth in such registration statement (hereafter, a "Shelf Registration
------------------
Statement" and, together with any Exchange Offer Registration Statement, a
---------
"Registration Statement").
----------------------
(b) Holdings shall use its reasonable best efforts to keep the Shelf
Registration Statement continuously effective in order to permit the prospectus
forming part thereof to be used by Holders of Transfer Restricted Discount Notes
for a period ending on the earlier of (i) two years from the Issue Date or such
shorter period that will terminate when all the Transfer Restricted Discount
Notes covered by the Shelf Registration Statement have been sold pursuant
thereto and (ii) the date all of the Discount Notes become eligible for resale
without volume restrictions pursuant to Rule 144 under the Securities Act (in
any such case,
6
such period being called the "Shelf Registration Period"). Holdings shall be
-------------------------
deemed not to have used its reasonable best efforts to keep the Shelf
Registration Statement effective during the requisite period if it voluntarily
takes any action that would result in Holders of Transfer Restricted Discount
Notes covered thereby not being able to offer and sell such Transfer Restricted
Discount Notes during that period, unless such action is required by applicable
law; provided, however, that no Holder of Discount Notes or Exchange Discount
-------- -------
Notes (other than the Initial Purchaser) shall be entitled to have Discount
Notes or Exchange Discount Notes held by it covered by such Shelf Registration
Statement unless such Holder agrees in writing to be bound by all the provisions
of this Agreement applicable to such Holder.
(c) Notwithstanding any other provisions hereof, Holdings will ensure
that (i) any Shelf Registration Statement and any amendment thereto and any
prospectus forming part thereof and any supplement thereto complies in all
material respects with the Securities Act and the rules and regulations of the
Commission thereunder, (ii) any Shelf Registration Statement and any amendment
thereto (in either case, other than with respect to information included therein
in reliance upon or in conformity with written information furnished to Holdings
by or on behalf of any Holder specifically for use therein (the "Holders'
--------
Information")) does not, when it becomes effective, contain an untrue statement
-----------
of a material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein not misleading and
(iii) any prospectus forming part of any Shelf Registration Statement, and any
supplement to such prospectus (in either case, other than with respect to
Holders' Information), does not include an untrue statement of a material fact
or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
Section 3. Liquidated Damages. (a) The parties hereto agree that
------------------
the Holders of Transfer Restricted Discount Notes will suffer damages if
Holdings fails to fulfill its obligations under Section 1 or Section 2, as
applicable, and that it would not be feasible to ascertain the extent of such
damages. Accordingly, if (i) a Registration Statement is not filed with the
Commission on or prior to 90 days after the Issue Date, (ii) the Exchange Offer
Registration Statement or a Shelf Registration Statement, if applicable, is not
declared effective within 180 days after the Issue Date (or in the case of a
Shelf Registration Statement required to be filed in response to a change in law
or the applicable interpretations of Commission's staff, if later, within 90
days after publication of the change in law or interpretation), (iii) the
Registered Exchange Offer is not consummated on or prior to 210 days after the
Issue Date, or (iv) a Shelf Registration Statement is filed and declared
effective within 180 days after the Issue Date (or in the case of a Shelf
Registration Statement required to be filed in response to a change in law or
the applicable interpretations of Commission's staff, if later, within 90 days
after publication of the change in law or interpretation) but shall thereafter
cease to be effective (at any time that Holdings is obligated to maintain the
effectiveness thereof) without being succeeded within 60 days by an additional
Registration Statement filed and declared effective (each such event referred to
in clauses (i) through (iv), a "Registration Default"), Holdings will be
--------------------
obligated to pay liquidated damages to each Holder of Transfer Restricted
Discount Notes, during the period of one or more such Registration Defaults, in
an amount equal to $0.192 per
7
week per $1,000 principal amount (or Accreted Value, as the case may be) of
Transfer Restricted Discount Notes held by such Holder until (i) the applicable
Registration Statement is filed, (ii) the Exchange Offer Registration Statement
is declared effective and the Registered Exchange Offer is consummated, (iii)
the Shelf Registration Statement is declared effective or (iv) the Shelf
Registration Statement again becomes effective, as the case may be. Following
the cure of all Registration Defaults, the accrual of liquidated damages will
cease. As used herein, the term "Transfer Restricted Discount Notes" means (i)
----------------------------------
each Discount Note until the date on which such Discount Note has been exchanged
for a freely transferable Exchange Discount Note in the Registered Exchange
Offer, (ii) each Discount Note or Private Exchange Discount Note until the date
on which it has been effectively registered under the Securities Act and
disposed of in accordance with the Shelf Registration Statement or (iii) each
Discount Note or Private Exchange Discount Note until the date on which it is
distributed to the public pursuant to Rule 144 under the Securities Act or is
saleable pursuant to Rule 144(k) under the Securities Act. Notwithstanding
anything to the contrary in this Section 3(a), Holdings shall not be required to
pay liquidated damages to a Holder of Transfer Restricted Discount Notes if such
Holder failed to comply with its obligations to make the representations set
forth in the second to last paragraph of Section 1 or failed to provide the
information required to be provided by it, if any, pursuant to Section 4(n).
(b) Holdings shall notify the Trustee and the Paying Agent under the
Indenture immediately upon the happening of each and every Registration Default.
Holdings shall pay the liquidated damages due on the Transfer Restricted
Discount Notes by depositing with the Paying Agent (which may not be Holdings
for these purposes), in trust, for the benefit of the Holders thereof, prior to
10:00 a.m., New York City time, on the next interest payment date specified by
the Indenture and the Discount Notes, sums sufficient to pay the liquidated
damages then due. The liquidated damages due shall be payable on each interest
payment date specified by the Indenture and the Discount Notes to the record
holder of the Transfer Restricted Discount Notes 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 date of the applicable
Registration Default.
(c) The parties hereto agree that the liquidated damages provided for
in this Section 3 constitute a reasonable estimate of and will constitute the
sole damages that will be suffered by Holders of Transfer Restricted Discount
Notes by reason of the failure of (i) the Shelf Registration Statement or the
Exchange Offer Registration Statement to be filed, (ii) the Shelf Registration
Statement to remain effective or (iii) the Exchange Offer Registration Statement
to be declared effective and the Registered Exchange Offer to be consummated, in
each case to the extent required by this Agreement.
Section 4. Registration Procedures. In connection with any
-----------------------
Registration Statement, the following provisions shall apply:
(a) Holdings shall (i) furnish to the Initial Purchaser, prior to the
filing thereof with the Commission, a copy of the Registration Statement and
each amendment
8
thereof and each supplement, if any, to the prospectus included therein and
shall use its reasonable best efforts to reflect in each such document, when so
filed with the Commission, such comments as the Initial Purchaser may reasonably
propose; (ii) if applicable, include the information set forth in Annex A hereto
on the cover, in Annex B hereto in the "Exchange Offer Procedures" section and
the "Purpose of the Exchange Offer" section and in Annex C hereto in the "Plan
of Distribution" section of the prospectus forming a part of the Exchange Offer
Registration Statement, and include the information set forth in Annex D hereto
in the Letter of Transmittal delivered pursuant to the Registered Exchange
Offer; and (iii) if requested by the Initial Purchaser, include the information
required by Items 507 or 508 of Regulation S-K, as applicable, in the prospectus
forming a part of the Exchange Offer Registration Statement.
(b) Holdings shall advise the Initial Purchaser, Exchanging Dealer
and the Holders (by notice to the Trustee) (if applicable) and, if requested by
any such person, confirm such advice in writing (which advice pursuant to
clauses (ii)-(v) hereof shall be accompanied by an instruction to suspend the
use of the prospectus until the requisite changes have been made):
(i) when any Registration Statement and any amendment thereto
has been filed with the Commission and when such Registration
Statement or any post-effective amendment thereto has become
effective;
(ii) of any request by the Commission for amendments or
supplements to any Registration Statement or the prospectus included
therein or for additional information;
(iii) of the issuance by the Commission of any stop order
suspending the effectiveness of any Registration Statement or the
initiation of any proceedings for that purpose;
(iv) of the receipt by Holdings of any notification with
respect to the suspension of the qualification of the Discount Notes,
the Exchange Discount Notes or the Private Exchange Discount 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 that requires the making of
any changes in any Registration Statement or the prospectus included
therein in order that the statements therein are not misleading and do
not omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading.
(c) Holdings will make every reasonable effort to obtain the
withdrawal at the earliest possible time of any order suspending the
effectiveness of any Registration Statement.
9
(d) Holdings will furnish, if requested, to each record Holder of
Transfer Restricted Discount Notes included within the coverage of any Shelf
Registration Statement, without charge, at least one conformed copy of such
Shelf Registration Statement and any post-effective amendment thereto, including
financial statements and schedules and, if any such Holder so requests in
writing, all exhibits thereto (including those, if any, incorporated by
reference).
(e) Holdings will, if requested, during the Shelf Registration
Period, promptly deliver to each Holder of Transfer Restricted Discount Notes
included within the coverage of any Shelf Registration Statement, without
charge, as many copies of the prospectus (including each preliminary prospectus)
included in such Shelf Registration Statement and any amendment or supplement
thereto as such Holder may reasonably request; and Holdings consents to the use
of such prospectus or any amendment or supplement thereto by each of the selling
Holders of Transfer Restricted Discount Notes in connection with the offer and
sale of the Transfer Restricted Discount Notes covered by such prospectus or any
amendment or supplement thereto.
(f) Holdings will furnish to the Initial Purchaser and each
Exchanging Dealer, and to any other Holder who so requests, without charge, at
least one conformed copy of the Exchange Offer Registration Statement and any
post-effective amendment thereto, including financial statements and schedules
and, if the Initial Purchaser or any Exchanging Dealer or any such Holder so
requests in writing, all exhibits thereto (including those, if any, incorporated
by reference).
(g) Holdings will, during the Exchange Offer Registration Period or
the Shelf Registration Period, as applicable, promptly deliver to the Initial
Purchaser, each Exchanging Dealer and such other persons that are required to
deliver a prospectus following the Registered Exchange Offer, without charge, as
many copies of the final prospectus included in the Exchange Offer Registration
Statement or the Shelf Registration Statement and any amendment or supplement
thereto as the Initial Purchaser, any Exchanging Dealer or other persons may
reasonably request; and Holdings consents to the use of the prospectus or any
amendment or supplement thereto by the Initial Purchaser, any Exchanging Dealer
or other persons, as applicable, as aforesaid.
(h) Prior to the effective date of any Registration Statement,
Holdings will use its reasonable best efforts to register or qualify, or
cooperate with the Holders of Discount Notes, Exchange Discount Notes or Private
Exchange Discount Notes included therein and their respective counsel in
connection with the registration or qualification of, such Discount Notes,
Exchange Discount Notes or Private Exchange Discount Notes for offer and sale
under the securities or blue sky laws of such jurisdictions as any such Holder
reasonably requests in writing and do any and all other acts or things necessary
or advisable to enable the offer and sale in such jurisdictions of the Discount
Notes, Exchange Discount Notes or Private Exchange Discount Notes covered by
such Registration Statement; provided that Holdings will not be required to
--------
qualify generally to do business in any jurisdiction where it is not then so
qualified
10
or to take any action which would subject it to general service of process or to
taxation in any such jurisdiction where it is not then so subject.
(i) Holdings will cooperate with the Holders of Discount Notes,
Exchange Discount Notes or Private Exchange Discount Notes to facilitate the
timely preparation and delivery of certificates representing Discount Notes,
Exchange Discount Notes or Private Exchange Discount Notes to be sold pursuant
to any Registration Statement free of any restrictive legends and in such
denominations and registered in such names as the Holders thereof may request in
writing prior to sales of Discount Notes, Exchange Discount Notes or Private
Exchange Discount Notes pursuant to such Registration Statement.
(j) If any event contemplated by Section 4(b)(ii) through (v) occurs
during the period for which Holdings is required to maintain an effective
Registration Statement, Holdings will promptly prepare and file with the
Commission a post-effective amendment to the Registration Statement or a
supplement to the related prospectus or file any other required document so
that, as thereafter delivered to purchasers of the Discount Notes, Exchange
Discount Notes or Private Exchange Discount Notes from a Holder, the prospectus
will not include an untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading.
(k) Not later than the effective date of the applicable Registration
Statement, Holdings will provide a CUSIP number for the Discount Notes, the
Exchange Discount Notes and the Private Exchange Discount Notes, as the case may
be, and provide the applicable trustee with printed certificates for the
Discount Notes, the Exchange Discount Notes or the Private Exchange Discount
Notes, as the case may be, in a form eligible for deposit with The Depository
Trust Company.
(l) Holdings will comply with all applicable rules and regulations of
the Commission and will make generally available to its security holders as soon
as practicable after the effective date of the applicable Registration Statement
an earning statement satisfying the provisions of Section 11(a) of the
Securities Act; provided that in no event shall such earning statement be
--------
delivered later than 45 days after the end of a 12-month period (or 90 days, if
such period is a fiscal year) beginning with the first month of Holdings's first
fiscal quarter commencing after the effective date of the applicable
Registration Statement, which statement shall cover such 12-month period.
(m) Holdings will cause the Indenture or the Exchange Discount Notes
Indenture, as the case may be, to be qualified under the Trust Indenture Act as
required by applicable law in a timely manner.
(n) Holdings may require each Holder of Transfer Restricted Discount
Notes to be registered pursuant to any Shelf Registration Statement to furnish
to Holdings such information concerning the Holder and the distribution of such
Transfer Restricted Discount
11
Notes as Holdings may from time to time reasonably require for inclusion in such
Shelf Registration Statement, and Holdings may exclude from such registration
the Transfer Restricted Discount Notes of any Holder that fails to furnish such
information within a reasonable time after receiving such request.
(o) In the case of a Shelf Registration Statement, each Holder of
Transfer Restricted Discount Notes to be registered pursuant thereto agrees by
acquisition of such Transfer Restricted Discount Notes that, upon receipt of any
notice from Holdings pursuant to Section 4(b)(ii) through (v), such Holder will
discontinue disposition of such Transfer Restricted Discount Notes until such
Xxxxxx's receipt of copies of the supplemental or amended prospectus
contemplated by Section 4(j) or until advised in writing (the "Advice") by
------
Holdings that the use of the applicable prospectus may be resumed. If Holdings
shall give any notice under Section 4(b)(ii) through (v) during the period that
Holdings is required to maintain an effective Registration Statement (the
"Effectiveness Period"), such Effectiveness Period shall be extended by the
--------------------
number of days during such period from and including the date of the giving of
such notice to and including the date when each seller of Transfer Restricted
Discount Notes covered by such Registration Statement shall have received (x)
the copies of the supplemental or amended prospectus contemplated by Section
4(j) (if an amended or supplemental prospectus is required) or (y) the Advice
(if no amended or supplemental prospectus is required).
(p) In the case of a Shelf Registration Statement, Holdings shall
enter into such customary agreements (including, if requested, an underwriting
agreement in customary form) and take all such other action, if any, as Holders
of a majority in aggregate principal amount of the Discount Notes, Exchange
Discount Notes and Private Exchange Discount Notes being sold or the managing
underwriters (if any) shall reasonably request in order to facilitate any
disposition of Discount Notes, Exchange Discount Notes or Private Exchange
Discount Notes pursuant to such Shelf Registration Statement.
(q) In the case of a Shelf Registration Statement, Holdings shall (i)
make reasonably available for inspection by a representative of, and Special
Counsel (as defined below) acting for, Holders of a majority in aggregate
principal amount of the Discount Notes, Exchange Discount Notes and Private
Exchange Discount Notes being sold and any underwriter participating in any
disposition of Discount Notes, Exchange Discount Notes or Private Exchange
Discount Notes pursuant to such Shelf Registration Statement, all relevant
financial and other records, pertinent corporate documents and properties of
Holdings and its subsidiaries and (ii) use its reasonable best efforts to have
its officers, directors, employees, accountants and counsel supply all relevant
information reasonably requested by such representative, Special Counsel or any
such underwriter (an "Inspector") in connection with such Shelf Registration
---------
Statement.
(r) In the case of a Shelf Registration Statement, Holdings shall, if
requested by Holders of a majority in aggregate principal amount of the Discount
Notes, Exchange Discount Notes and Private Exchange Discount Notes being sold,
their Special Counsel or the
12
managing underwriters (if any) in connection with such Shelf Registration
Statement, use its reasonable best efforts to cause (i) its counsel to deliver
an opinion relating to the Shelf Registration Statement and the Discount Notes,
Exchange Discount Notes or Private Exchange Discount Notes, as applicable, in
customary form, (ii) its officers to execute and deliver all customary documents
and certificates requested by Holders of a majority in aggregate principal
amount of the Discount Notes, Exchange Discount Notes and Private Exchange
Discount Notes being sold, their Special Counsel or the managing underwriters
(if any) and (iii) its independent public accountants to provide a comfort
letter in customary form, subject to receipt of appropriate documentation as
contemplated, and only if permitted, by Statement of Auditing Standards No. 72.
Section 5. Registration Expenses. Holdings will bear all expenses
---------------------
incurred in connection with the performance of its obligations under Sections 1,
2, 3 and 4 and Holdings will reimburse the Initial Purchaser and the Holders for
the reasonable fees and disbursements of one firm of attorneys (in addition to
any local counsel) chosen by the Holders of a majority in aggregate principal
amount of the Discount Notes, the Exchange Discount Notes and the Private
Exchange Discount Notes to be sold pursuant to each Registration Statement (the
"Special Counsel") acting for the Initial Purchaser or Holders in connection
---------------
therewith.
Section 6. Indemnification. (a) In the event of a Shelf
---------------
Registration Statement or in connection with any prospectus delivery pursuant to
an Exchange Offer Registration Statement by the Initial Purchaser or Exchanging
Dealer, as applicable, Holdings and Details, jointly and severally, shall
indemnify and hold harmless each Holder (including, without limitation, the
Initial Purchaser or any such Exchanging Dealer), its affiliates, their
respective officers, directors, employees, representatives and agents, and each
person, if any, who controls such Holder within the meaning of the Securities
Act or the Exchange Act (collectively referred to for purposes of this Section 6
and Section 7 as a Holder) from and against any loss, claim, damage or
liability, joint or several, or any action in respect thereof (including,
without limitation, any loss, claim, damage, liability or action relating to
purchases and sales of Discount Notes, Exchange Discount Notes or Private
Exchange Discount Notes), to which that Holder may become subject, whether
commenced or threatened, under the Securities Act, the Exchange Act, any other
federal or state statutory law or regulation, at common law or otherwise,
insofar as such loss, claim, damage, liability or action arises out of, or is
based upon, (i) any untrue statement or alleged untrue statement of a material
fact contained in any such Registration Statement or any prospectus forming part
thereof or in any amendment or supplement thereto or (ii) the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, and shall reimburse
each Holder as incurred for any legal or other expenses reasonably incurred by
that Holder in connection with investigating or defending or preparing to defend
against or appearing as a third party witness in connection with any such loss,
claim, damage, liability or action as such expenses are incurred; provided,
--------
however, that neither Holdings nor Details shall be liable in any such case to
-------
the extent that any such loss, claim, damage, liability or action arises out of,
or is based upon, an untrue statement or alleged untrue statement in or
13
omission or alleged omission from any of such documents in reliance upon and in
conformity with any Holders' Information; and provided, further, that with
-------- -------
respect to any such untrue statement in or omission from any related preliminary
prospectus, the indemnity agreement contained in this Section 6(a) shall not
inure to the benefit of any Holder from whom the person asserting any such loss,
claim, damage, liability or action received Discount Notes, Exchange Discount
Notes or Private Exchange Discount Notes to the extent that such loss, claim,
damage, liability or action of or with respect to such Holder results from the
fact that both (A) a copy of the final prospectus was not sent or given to such
person at or prior to the written confirmation of the sale of such Discount
Notes, Exchange Discount Notes or Private Exchange Discount Notes to such person
and (B) the untrue statement in or omission from the related preliminary
prospectus was corrected in the final prospectus unless, in either case, such
failure to deliver the final prospectus was a result of non-compliance by
Holdings with Section 4(d), 4(e), 4(f) or 4(g).
(b) In the event of a Shelf Registration Statement, each Holder,
severally and not jointly, shall indemnify and hold harmless each of Holdings
and Details, its affiliates, their respective officers, directors, employees,
representatives and agents, and each person, if any, who controls Holdings or
Details within the meaning of the Securities Act or the Exchange Act
(collectively referred to for purposes of this Section 6(b) and Section 7 as
Holdings), from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof, to which Holdings may become subject,
whether commenced or threatened, under the Securities Act, the Exchange Act, any
other federal or state statutory law or regulation, at common law or otherwise,
insofar as such loss, claim, damage, liability or action arises out of, or is
based upon, (i) any untrue statement or alleged untrue statement of a material
fact contained in any such Registration Statement or any prospectus forming part
thereof or in any amendment or supplement thereto or (ii) the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, but in each case only
to the extent that the untrue statement or alleged untrue statement or omission
or alleged omission was made in reliance upon and in conformity with any
Holders' Information furnished to Holdings by such Holder, and shall reimburse
Holdings and Details for any legal or other expenses reasonably incurred by
Holdings and Details in connection with investigating or defending or preparing
to defend against or appearing as a third party witness in connection with any
such loss, claim, damage, liability or action as such expenses are incurred;
provided, however, that no such Holder shall be liable for any indemnity claims
-------- -------
hereunder in excess of the amount of net proceeds received by such Holder from
the sale of Discount Notes, Exchange Discount Notes or Private Exchange Discount
Notes pursuant to such Shelf Registration Statement.
(c) Promptly after receipt by an indemnified party under this Section
6 of notice of any claim or the commencement of any action, the indemnified
party shall, if a claim in respect thereof is to be made against the
indemnifying party pursuant to Section 6(a) or 6(b), notify the indemnifying
party in writing of the claim or the commencement of that action; provided,
--------
however, that the failure to notify the indemnifying party shall not relieve it
-------
from
14
any liability which it may have under this Section 6 except to the extent that
it has been materially prejudiced (through the forfeiture of substantive rights
or defenses) by such failure; and provided, further, that the failure to notify
-------- -------
the indemnifying party shall not relieve it from any liability which it may have
to an indemnified party otherwise than under this Section 6. If any such claim
or action shall be brought against an indemnified party, and it shall notify the
indemnifying party thereof, the indemnifying party shall be entitled to
participate therein and, to the extent that it wishes, jointly with any other
similarly notified indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party. After notice from the
indemnifying party to the indemnified party of its election to assume the
defense of such claim or action, the indemnifying party shall not be liable to
the indemnified party under this Section 6 for any legal or other expenses
subsequently incurred by the indemnified party in connection with the defense
thereof other than the reasonable costs of investigation; provided, however,
-------- -------
that an indemnified party shall have the right to employ its own counsel in any
such action, but the fees, expenses and other charges of such counsel for the
indemnified party will be at the expense of such indemnified party unless (1)
the employment of counsel by the indemnified party has been authorized in
writing by the indemnifying party, (2) the indemnified party has reasonably
concluded (based upon advice of counsel to the indemnified party) that there may
be legal defenses available to it or other indemnified parties that are
different from or in addition to those available to the indemnifying party, (3)
a conflict or potential conflict exists (based upon advice of counsel to the
indemnified party) between the indemnified party and the indemnifying party (in
which case the indemnifying party will not have the right to direct the defense
of such action on behalf of the indemnified party) or (4) the indemnifying party
has not in fact employed counsel reasonably satisfactory to the indemnified
party to assume the defense of such action within a reasonable time after
receiving notice of the commencement of the action, in each of which cases the
reasonable fees, disbursements and other charges of counsel will be at the
expense of the indemnifying party or parties. It is understood that the
indemnifying party or parties shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the reasonable fees,
disbursements and other charges of more than one separate firm of attorneys (in
addition to any local counsel) at any one time for all such indemnified party or
parties. Each indemnified party, as a condition of the indemnity agreements
contained in Sections 6(a) and 6(b), shall use all reasonable efforts to
cooperate with the indemnifying party in the defense of any such action or
claim. No indemnifying party shall be liable for any settlement of any such
action effected without its written consent (which consent shall not be
unreasonably withheld), but if settled with its written consent or if there be a
final judgment for the plaintiff in any such action, the indemnifying party
agrees to indemnify and hold harmless any indemnified party from and against any
loss or liability by reason of such settlement or judgment. No indemnifying
party shall, without the prior written consent of the indemnified party (which
consent shall not be unreasonably withheld), effect any settlement of any
pending or threatened proceeding in respect of which any indemnified party is or
could have been a party and indemnity could have been sought hereunder by such
indemnified party, unless such settlement includes an unconditional release of
such indemnified party from all liability on claims that are the subject matter
of such proceeding.
15
Section 7. Contribution. If the indemnification provided for in
------------
Section 6 is unavailable or insufficient to hold harmless an indemnified party
under Section 6(a) or 6(b), then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or payable by
such indemnified party as a result of such loss, claim, damage or liability, or
action in respect thereof, (i) in such proportion as shall be appropriate to
reflect the relative benefits received by Holdings from the offering and sale of
the Discount Notes, on the one hand, and a Holder with respect to the sale by
such Holder of Discount Notes, Exchange Discount Notes or Private Exchange
Discount Notes, on the other, 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 Holdings and Details on the one hand and such Holder
on the other with respect to the statements or omissions that resulted in such
loss, claim, damage or liability, or action in respect thereof, as well as any
other relevant equitable considerations. The relative benefits received by
Holdings on the one hand and a Holder on the other with respect to such offering
and such sale shall be deemed to be in the same proportion as the total net
proceeds from the offering of the Discount Notes (before deducting expenses)
received by or on behalf of Holdings as set forth in the table on the cover of
the Offering Memorandum, on the one hand, bear to the total proceeds received by
such Holder with respect to its sale of Discount Notes, Exchange Discount Notes
or Private Exchange Discount Notes, on the other. The relative fault shall be
determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to Holdings, Details or information supplied by Holdings
or Details on the one hand or to any Holders' Information supplied by such
Holder on the other, the intent of the parties and their relative knowledge,
access to information and opportunity to correct or prevent such untrue
statement or omission. The parties hereto agree that it would not be just and
equitable if contributions pursuant to this Section 7 were to be determined by
pro rata allocation or by any other method of allocation that does not take into
account the equitable considerations referred to herein. The amount paid or
payable by an indemnified party as a result of the loss, claim, damage or
liability, or action in respect thereof, referred to above in this Section 7
shall be deemed to include, for purposes of this Section 7, any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending or preparing to defend any such action or claim.
Notwithstanding the provisions of this Section 7, an indemnifying party that is
a Holder of Discount Notes, Exchange Discount Notes or Private Exchange Discount
Notes shall not be required to contribute any amount in excess of the amount by
which the total price at which the Discount Notes, Exchange Discount Notes or
Private Exchange Discount Notes sold by such indemnifying party to any purchaser
exceeds the amount of any damages which such indemnifying party has otherwise
paid or become liable to pay by reason of any 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.
Section 8. Rules 144 and 144A. Holdings shall use its reasonable
------------------
best efforts to file the reports required to be filed by it under the Securities
Act and the Exchange Act in a
16
timely manner and, if at any time Holdings is not required to file such reports,
it will, upon the written request of any Holder of Transfer Restricted Discount
Notes, make publicly available other information so long as necessary to permit
sales of such Xxxxxx's securities pursuant to Rules 144 and 144A. Upon the
written request of any Holder of Transfer Restricted Discount Notes, Holdings
shall deliver to such Holder a written statement as to whether it has complied
with such requirements. Notwithstanding the foregoing, nothing in this Section 8
shall be deemed to require Holdings to register any of its securities pursuant
to the Exchange Act.
Section 9. Underwritten Registrations. If any of the Transfer
--------------------------
Restricted Discount Notes covered by any Shelf Registration Statement 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 such Transfer
Restricted Discount Notes included in such offering, subject to the consent of
Holdings (which shall not be unreasonably withheld or delayed), and such Holders
shall be responsible for all underwriting commissions and discounts in
connection therewith.
No person may participate in any underwritten registration hereunder
unless such person (i) agrees to sell such person's Transfer Restricted Discount
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 reasonably required under the terms
of such underwriting arrangements.
Section 10. Miscellaneous. (a) Amendments and Waivers. The
------------- ----------------------
provisions of this Agreement may not be amended, modified or supplemented, and
waivers or consents to departures from the provisions hereof may not be given,
unless Holdings has obtained the written consent of Holders of a majority in
aggregate principal amount of the Discount Notes, the Exchange Discount Notes
and the Private Exchange Discount Notes, taken as a single class.
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 whose Discount Notes, Exchange Discount Notes or Private Exchange
Discount Notes are being sold pursuant to a Registration Statement and that does
not directly or indirectly affect the rights of other Holders may be given by
Holders of a majority in aggregate principal amount of the Discount Notes, the
Exchange Discount Notes and the Private Exchange Discount Notes being sold by
such Holders pursuant to such Registration Statement.
(b) Notices. All notices and other communications provided for or
-------
permitted hereunder shall be made in writing by hand-delivery, first-class mail,
telecopier or air courier guaranteeing next-day delivery:
(1) if to a Holder, at the most current address given by such Holder
to Holdings in accordance with the provisions of this Section 10(b), which
address initially is, with respect to each Holder, the address of such
Holder maintained by the Registrar under the Indenture, with a copy in like
manner to Chase Securities Inc.;
17
(2) if to the Initial Purchaser, initially at its address set forth
in the Purchase Agreement;
(3) if to Holdings, initially at the address of Holdings set forth in
the Purchase Agreement; and
(4) if to Details, initially at the address of Details set forth in
the Purchase Agreement.
All such notices and communications shall be deemed to have been duly
given: when delivered by hand, if personally delivered; one business day after
being delivered to a next-day air courier; five business days after being
deposited in the mail; and when receipt is acknowledged by the recipient's
telecopier machine, if sent by telecopier.
(c) Successors And Assigns. This Agreement shall be binding upon
----------------------
Holdings, Details and their respective successors and assigns.
(d) Counterparts. This Agreement may be executed in any number of
------------
counterparts (which may be delivered in original form or by telecopier) 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.
(e) Definition of Terms. For purposes of this Agreement, (a) the
-------------------
term "business day" means any day on which the New York Stock Exchange, Inc. is
open for trading, (b) the term "subsidiary" has the meaning set forth in Rule
405 under the Securities Act and (c) except where otherwise expressly provided,
the term "affiliate" has the meaning set forth in Rule 405 under the Securities
Act.
(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 laws of the State of New York.
(h) Remedies. In the event of a breach by Holdings or by any Holder
--------
of any of their obligations under this Agreement, each Holder or Holdings, as
the case may be, in addition to being entitled to exercise all rights granted by
law, including recovery of damages (other than the recovery of damages for a
breach by Holdings of its obligations under Sections 1 or 2 hereof for which
liquidated damages have been paid pursuant to Section 3 hereof), will be
entitled to specific performance of its rights under this Agreement. Holdings
and each Holder agree that monetary damages would not be adequate compensation
for any loss incurred by reason of a breach by it of any of the provisions of
this Agreement and hereby further agree 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.
18
(i) No Inconsistent Agreements. Holdings represents, warrants and
--------------------------
agrees that (i) it has not entered into, shall not, on or after the date of this
Agreement, enter into any agreement that is inconsistent with the rights granted
to the Holders in this Agreement or otherwise conflicts with the provisions
hereof, (ii) it has not previously entered into any agreement which remains in
effect granting any registration rights with respect to any of its debt
securities to any person and (iii) without limiting the generality of the
foregoing, without the written consent of the Holders of a majority in aggregate
principal amount of the then outstanding Transfer Restricted Discount Notes, it
shall not grant to any person the right to request Holdings to register any debt
securities of Holdings under the Securities Act unless the rights so granted are
not in conflict or inconsistent with the provisions of this Agreement.
(j) No Piggyback on Registrations. Neither Holdings nor any of its
-----------------------------
security holders (other than the Holders of Transfer Restricted Discount Notes
in such capacity) shall have the right to include any securities of Holdings in
any Shelf Registration Statement or Registered Exchange Offer other than
Transfer Restricted Discount Notes.
(k) 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 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 best 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.
Please confirm that the foregoing correctly sets forth the agreement
among Holdings, Details and the Initial Purchaser.
Very truly yours,
DETAILS HOLDINGS CORP.
By /s/ Xxxxx XxXxxxxx
---------------------------
Name: Xxxxx XxXxxxxx
Title: President
DETAILS, INC.
By /s/ Xxxxx XxXxxxxx
---------------------------
Name: Xxxxx XxXxxxxx
Title: President
Accepted:
CHASE SECURITIES INC.
By /s/ Xxxxx X. Xxxxx
----------------------------
Authorized Signatory
ANNEX A
Each broker-dealer that receives Exchange Discount Notes for its own
account pursuant to the Registered Exchange Offer must acknowledge that it will
deliver a prospectus in connection with any resale of such Exchange Discount
Notes. The Letter of Transmittal states that by so acknowledging and by
delivering a prospectus, a broker-dealer will not be deemed to admit that it is
an "underwriter" within the meaning of the Securities Act. This Prospectus, as
it may be amended or supplemented from time to time, may be used by a broker-
dealer in connection with resales of Exchange Discount Notes received in
exchange for Discount Notes where such Discount Notes were acquired by such
broker-dealer as a result of market-making activities or other trading
activities. Holdings has agreed that, for a period of 90 days after the
Expiration Date (as defined herein), it will make this Prospectus available to
any broker-dealer for use in connection with any such resale. See "Plan of
Distribution."
ANNEX B
Each broker-dealer that receives Exchange Discount Notes for its own
account in exchange for Discount Notes, where such Discount Notes were acquired
by such broker-dealer as a result of market-making activities or other trading
activities, must acknowledge that it will deliver a prospectus in connection
with any resale of such Exchange Discount Notes. See "Plan of Distribution."
ANNEX C
PLAN OF DISTRIBUTION
Each broker-dealer that receives Exchange Discount Notes for its own
account pursuant to the Registered Exchange Offer must acknowledge that it will
deliver a prospectus in connection with any resale of such Exchange Discount
Notes. This Prospectus, as it may be amended or supplemented from time to time,
may be used by a broker-dealer in connection with resales of Exchange Discount
Notes received in exchange for Discount Notes where such Discount Notes were
acquired as a result of market-making activities or other trading activities.
Holdings has agreed that, for a period of 90 days after the Expiration Date, it
will make this prospectus, as amended or supplemented, available to any broker-
dealer for use in connection with any such resale. In addition, until
_______________, 199_, all dealers effecting transactions in the Exchange
Discount Notes may be required to deliver a prospectus./1/
Holdings will not receive any proceeds from any sale of Exchange
Discount Notes by broker-dealers. Exchange Discount Notes received by broker-
dealers for their own account pursuant to the Registered Exchange Offer may be
sold from time to time in one or more transactions in the over-the-counter
market, in negotiated transactions, through the writing of options on the
Exchange Discount Notes or a combination of such methods of resale, at market
prices prevailing at the time of resale, at prices related to such prevailing
market prices or at negotiated prices. Any such resale may be made directly to
purchasers or to or through brokers or dealers who may receive compensation in
the form of commissions or concessions from any such broker-dealer or the
purchasers of any such Exchange Discount Notes. Any broker-dealer that resells
Exchange Discount Notes that were received by it for its own account pursuant to
the Registered Exchange Offer and any broker or dealer that participates in a
distribution of such Exchange Discount Notes may be deemed to be an
"underwriter" within the meaning of the Securities Act and any profit on any
such resale of Exchange Discount Notes and any commission or concessions
received by any such persons may be deemed to be underwriting compensation under
the Securities Act. The Letter of Transmittal states that, by acknowledging
that it will deliver and by delivering a prospectus, a broker-dealer will not be
deemed to admit that it is an "underwriter" within the meaning of the Securities
Act.
For a period of 90 days after the Expiration Date Holdings will
promptly send additional copies of this Prospectus and any amendment or
supplement to this Prospectus to any broker-dealer that requests such documents
in the Letter of Transmittal. Holdings has agreed to pay all expenses incident
to the Registered Exchange Offer (including the expenses of one counsel for the
Holders of the Discount Notes) other than commissions or concessions of any
broker-dealers and will indemnify the Holders of the Discount Notes (including
any broker-dealers) against certain liabilities, including liabilities under the
Securities Act.
_____________________________
/1/ In addition, the legend required by Item 502(e) of Regulation S-K will
appear on the back cover page of the Registered Exchange Offer prospectus.
ANNEX D
[_] CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10
ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR
SUPPLEMENTS THERETO.
Name:________________________________________
Address:_____________________________________
_____________________________________
If the undersigned is not a broker-dealer, the undersigned represents that it is
not engaged in, and does not intend to engage in, a distribution of Exchange
Discount Notes. If the undersigned is a broker-dealer that will receive
Exchange Discount Notes for its own account in exchange for Discount Notes that
were acquired as a result of market-making activities or other trading
activities, it acknowledges that it will deliver a prospectus in connection with
any resale of such Exchange Discount Notes; however, by so acknowledging and by
delivering a prospectus, the undersigned will not be deemed to admit that it is
an "underwriter" within the meaning of the Securities Act.
