REGISTRATION RIGHTS AGREEMENT
THIS REGISTRATION RIGHTS AGREEMENT (the "AGREEMENT") is made and entered
into as of October 26, 1999 among U S WEST Communications, Inc., a Colorado
corporation (the "COMPANY"), and the Initial Purchasers (as hereinafter
defined).
This Agreement is made pursuant to the Purchase Agreement dated October 26,
1999 (the "PURCHASE AGREEMENT"), among the Company, as issuer of the 7.20% Notes
due November 1, 2004 (the "SECURITIES"), and the Initial Purchasers, which
provides for, among other things, the sale by the Company to the Initial
Purchasers of the aggregate principal amount of Securities specified therein. In
order to induce the Initial Purchasers to enter into the Purchase Agreement, the
Company has agreed to provide to the Initial Purchasers and their direct and
indirect transferees the registration rights set forth in this Agreement. The
execution and delivery of this Agreement is a condition to the closing under the
Purchase Agreement.
In consideration of the foregoing, the parties hereto agree as follows:
SECTION 1. DEFINITIONS. As used in this Agreement, the following
capitalized defined terms shall have the following meanings:
"ADVICE" shall have the meaning set forth in the last paragraph of Section
3 hereof.
"AFFILIATE" has the same meaning as given to that term in Rule 405 under
the Securities Act or any successor rule thereunder.
"APPLICABLE PERIOD" shall have the meaning set forth in Section 3(t)
hereof.
"BUSINESS DAY" means any day other than a day on which banks are permitted
or required to be closed in The City of New York.
"COMPANY" shall have the meaning set forth in the preamble to this
Agreement and also includes the Company's successors and permitted assigns.
"DEPOSITARY" shall mean The Depository Trust Company, or any other
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.
"EXCHANGE ACT" shall mean the Securities Exchange Act of 1934, as amended
from time to time.
"EXCHANGE OFFER" shall mean the offer by the Company to the Holders to
exchange all of the Registrable Securities for a like amount of EXCHANGE
SECURITIES pursuant to Section 2(a) hereof.
"EXCHANGE OFFER REGISTRATION" shall mean a registration under the
Securities Act effected pursuant to Section 2(a) hereof.
"EXCHANGE OFFER REGISTRATION STATEMENT" shall mean an exchange offer
registration statement on Form S-4 (or, if applicable, on another appropriate
form), and all amendments and supplements to such registration statement, in
each case including the Prospectus contained therein, all exhibits thereto and
all documents incorporated by reference therein.
"EXCHANGE PERIOD" shall have the meaning set forth in Section 2(a) hereof.
"EXCHANGE SECURITIES" shall mean the 7.20% Notes due November 1, 2004
issued by the Company under the Indenture containing terms identical in all
material respects to the Securities (except that (i) interest thereon shall
accrue from the last date on which interest was paid or duly provided for on the
Securities or, if no such interest has been paid, from the date of their
original issue, (ii) they will not contain terms with respect to transfer
restrictions under the Securities Act and (iii) they will not provide for any
Special Interest Premium thereon) to be offered to Holders of Securities in
exchange for Securities pursuant to the Exchange Offer.
"HOLDER" shall mean any Initial Purchaser, for so long as it owns any
Registrable Securities, and each of its successors, assigns and direct and
indirect transferees who become registered owners of Registrable Securities
under the Indenture.
"INDENTURE" shall mean the Indenture, dated as of October 15, 1999, between
the Company, as issuer, and Bank One Trust Company, NA, as trustee, as the same
may be amended or supplemented from time to time in accordance with the terms
thereof.
"INITIAL PURCHASERS" shall mean Xxxxxxx Xxxxx Xxxxxx Inc., ABN AMRO
Incorporated, Banc of America Securities LLC, Chase Securities Inc., The
Xxxxxxxx Capital Group, L.P., McDonald Investment Inc., U.S. Bancorp Piper
Xxxxxxx, Xxxxxxxx Capital Partners, BNP Capital Markets, LLC, Commerzbank
Capital Markets Corporation, RBC Dominion Securities Corporation, and TD
Securities USA, Inc.
"INSPECTORS" shall have the meaning set forth in Section 3(n) hereof.
"ISSUE DATE" shall mean November 1, 1999, the initial date of delivery of
the Securities from the Company to the Initial Purchasers.
"MAJORITY HOLDERS" shall mean the Holders of a majority of the aggregate
principal amount of outstanding Securities and EXCHANGE SECURITIES.
"PARTICIPATING BROKER-DEALER" shall have the meaning set forth in Section
3(t) hereof.
"PERSON" shall mean an individual, partnership, corporation, trust or
unincorporated organization, limited liability corporation, or a government or
agency or political subdivision thereof.
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"PROSPECTUS" shall mean the prospectus included in a Registration
Statement, including any preliminary prospectus, and any such prospectus as
amended or supplemented by any prospectus supplement, including a prospectus
supplement with respect to the terms of the offering of any portion of the
Registrable Securities covered by a Shelf Registration Statement, and by all
other amendments and supplements to a prospectus, including post-effective
amendments, and in each case including all documents 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 Securities; PROVIDED, HOWEVER, that
any Securities shall cease to be Registrable Securities when any of the
following occurs: (i) a Registration Statement with respect to such Securities
for the exchange or resale thereof shall have been declared effective under the
Securities Act and such Securities shall have been disposed of pursuant to such
Registration Statement, (ii) such Securities shall have been sold to the public
pursuant to Rule 144(k) (or any similar provision then in force, but not Rule
144A) under the Securities Act or are eligible to be sold without restriction as
contemplated by Rule 144(k), (iii) such Securities shall have ceased to be
outstanding or (iv) such Securities shall have been exchanged for EXCHANGE
SECURITIES upon consummation of the Exchange Offer and are thereafter freely
tradable by the Holder thereof (other than an Affiliate of the Company).
"REGISTRATION EXPENSES" shall mean any and all expenses incident to
performance of or compliance by the Company with this Agreement, including
without limitation: (i) all SEC or National Association of Securities Dealers,
Inc. (the "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) all fees and
expenses incurred in connection with compliance with state securities or blue
sky laws (including reasonable fees and disbursements of one counsel for all
underwriters and Holders as a group in connection with blue sky qualification of
any of the Exchange Securities or Registrable Securities) and compliance with
the rules of the NASD, (iii) all expenses of any Persons in preparing or
assisting in preparing, word processing, printing and distributing any
Registration Statement, any Prospectus and any amendments or supplements
thereto, 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 this Agreement, (iv) all
rating agency fees, (v) the fees and disbursements of counsel for the Company
and of the independent certified public accountants of the Company and its
subsidiaries, including the expenses of any "cold comfort" letters required by
or incident to the performance of and compliance with this Agreement, (vi) the
reasonable fees and expenses of the Trustee and its counsel and any exchange
agent or custodian, and (vii) the reasonable fees and expenses of any special
experts retained by the Company in connection with any Registration Statement.
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"REGISTRATION STATEMENT" shall mean any registration statement of the
Company which covers any of the Exchange Securities 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
documents incorporated by reference therein.
"RULE 144(k) PERIOD" shall mean the period of two years (or such shorter
period as may hereafter be referred to in Rule 144(k) under the Securities Act
(or similar successor rule)) commencing on the Issue Date.
"SEC" shall mean the Securities and Exchange Commission.
"SECURITIES" shall have the meaning set forth in the preamble to this
Agreement.
"SECURITIES ACT" shall mean the Securities Act of 1933, as amended from
time to time.
"SHELF REGISTRATION" shall mean a registration effected pursuant to Section
2(b) hereof.
"SHELF REGISTRATION EVENT" shall have the meaning set forth in Section 2(b)
hereof.
"SHELF REGISTRATION EVENT DATE" shall have the meaning set forth in Section
2(b) hereof.
"SHELF REGISTRATION STATEMENT" shall mean a "shelf" registration statement
of the Company pursuant to the provisions of Section 2(b) hereof which covers
all of the Registrable Securities (except Registrable Securities which the
Holders have elected not to include in such Shelf Registration Statement or the
Holders of which have not complied with their obligations under the penultimate
paragraph of Section 3 hereof or under the penultimate sentence of Section 2(b)
hereof) on an appropriate form under Rule 415 under the Securities Act, or any
similar rule that may be adopted by the SEC, and all amendments and supplements
to such registration statement, including post-effective amendments, in each
case including the Prospectus contained therein, all exhibits thereto and all
documents incorporated by reference therein.
"SPECIAL INTEREST PREMIUM" shall have the meaning set forth in Section 2(e)
hereof.
"TIA" shall have the meaning set forth in Section 3(k) hereof.
"TRUSTEE" shall mean the trustee under the Indenture.
SECTION 2. REGISTRATION UNDER THE SECURITIES ACT.
(a) EXCHANGE OFFER. Except as set forth in Section 2(b) below, the Company
shall, for the benefit of the Holders, at the Company's cost, use its reasonable
best efforts to (i) file with the SEC within 150 calendar days after the Issue
Date an Exchange Offer Registration Statement on an appropriate form under the
Securities Act relating to the Exchange Offer, (ii) cause such Exchange Offer
Registration Statement to be declared effective under the Securities Act by the
SEC not later than the date which is 180 calendar days after the Issue Date,
(iii) keep such Exchange Offer Registration Statement effective for not less
than 30 calendar days (or longer if
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required by applicable law) after the date notice of the Exchange Offer is
mailed to the Holders and (iv) cause the Exchange Offer to be consummated within
225 calendar days after the Issue Date. Promptly after the effectiveness of the
Exchange Offer Registration Statement, the Company shall commence the Exchange
Offer, it being the objective of such Exchange Offer to enable each Holder
eligible and electing to exchange Registrable Securities for a like principal
amount of Exchange Securities (provided that such Holder (i) is not an Affiliate
of the Company, (ii) is not a broker-dealer tendering Registrable Securities
acquired directly from the Company, (iii) acquires the Exchange Securities in
the ordinary course of such Holder's business and (iv) has no arrangements or
understandings with any Person to participate in the Exchange Offer for the
purpose of distributing the Exchange Securities) to transfer such Exchange
Securities from and after their receipt without any limitations or restrictions
under the Securities Act and 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 referred to herein as the "EXCHANGE
PERIOD");
(iii) utilize the services of the Depositary for the Exchange Offer with
respect to Securities represented by a global certificate;
(iv) permit Holders to withdraw tendered Registrable Securities 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 to
Holders, a telegram, telex, facsimile transmission or letter setting forth the
name of such Holder, the principal amount of Registrable Securities delivered
for exchange, and a statement that such Holder is withdrawing his election to
have such Registrable Securities exchanged;
(v) notify each Holder that any Registrable Security not tendered by such
Holder in the Exchange Offer will remain outstanding and continue to accrue
interest but will not retain any rights under this Agreement (except in the case
of the Initial Purchasers and Participating Broker-Dealers as provided herein);
and
(vi) otherwise comply in all respects with all applicable laws relating to
the Exchange Offer.
As soon as practicable after the close of the Exchange Offer, the Company
shall:
(i) accept for exchange all Registrable Securities or portions thereof duly
tendered and not validly withdrawn pursuant to the Exchange Offer in accordance
with the terms of the Exchange Offer Registration Statement and letter of
transmittal which is an exhibit thereto;
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(ii) deliver, or cause to be delivered, to the Trustee for cancellation all
Registrable Securities or portions thereof so accepted for exchange by the
Company; and
(iii) issue, and cause the Trustee under the Indenture to promptly
authenticate and deliver to each Holder, Exchange Securities equal in principal
amount to the principal amount of the Securities as are surrendered by such
Holder.
Interest on each Exchange Security issued pursuant to the Exchange Offer
will accrue from the last date on which interest was paid or duly provided for
on the Security surrendered in exchange therefor or, if no interest has been
paid on such Security, from the Issue Date. To the extent not prohibited by any
law or applicable interpretation of the staff of the SEC, the Company shall use
reasonable best efforts to complete the Exchange Offer as provided above, and
shall comply with the applicable requirements of the Securities Act, the
Exchange Act and other applicable laws in connection with the Exchange Offer.
The Exchange Offer shall not be subject to any conditions other than the
conditions referred to in Section 2(b)(i) and (ii) below and those conditions
that are customary in similar exchange offers. Each Holder of Registrable
Securities who wishes to exchange such Registrable Securities for Exchange
Securities in the Exchange Offer will be required to make certain customary
representations in connection therewith, including, in the case of any Holder,
representations that (i) it is not an Affiliate of the Company, (ii) it is not a
broker-dealer tendering Registrable Securities acquired directly from the
Company, (iii) the Exchange Securities to be received by it are being acquired
in the ordinary course of its business and (iv) at the time of the Exchange
Offer, it has no arrangements or understandings with any Person to participate
in the distribution (within the meaning of the Securities Act) of the Exchange
Securities. The Company shall inform the Initial Purchasers, after consultation
with the Trustee, of the names and addresses of the Holders to whom the Exchange
Offer is made, and the Initial Purchasers shall have the right to contact such
Holders in order to facilitate the tender of Registrable Securities in the
Exchange Offer.
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 Exchange Securities held by Participating
Broker-Dealers, and the Company shall have no further obligation to register the
Registrable Securities held by any Holder pursuant to Section 2(b) of this
Agreement.
(b) SHELF REGISTRATION. If (i) because of any change in law or in currently
prevailing interpretations thereof by the staff of the SEC, the Company is not
permitted to effect the Exchange Offer as contemplated by Section 2(a) hereof,
(ii) the Exchange Offer is not consummated within 225 days after the Issue Date
or (iii) upon the request of any Initial Purchaser with respect to any
Registrable Securities held by it, if such Initial Purchaser is not permitted,
in the reasonable opinion of Xxxxx & Xxxx LLP, pursuant to applicable law or
applicable interpretations of the staff of the SEC, to participate in the
Exchange Offer and thereby receive securities that are freely tradeable without
restriction under the Securities Act and applicable blue sky or state securities
laws (other than due solely to the status of such Initial Purchaser as an
Affiliate of the Company or as a Participating Broker-Dealer) (any of the events
specified in (i), (ii) or (iii) being a "SHELF REGISTRATION EVENT", and the date
of occurrence thereof,
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the "SHELF REGISTRATION EVENT DATE"), then in addition to or in lieu of
conducting the Exchange Offer contemplated by Section 2(a), as the case may be,
the Company shall promptly notify the Holders in writing thereof and shall, at
its cost, file as promptly as practicable after such Shelf Registration Event
Date and, in any event, within 90 days after such Shelf Registration Event Date,
a Shelf Registration Statement providing for the sale by the Holders of all of
the Registrable Securities (other than Registrable Securities owned by Holders
who have elected not to include such Registrable Securities in such Shelf
Registration Statement or who have not complied with their obligations under the
penultimate paragraph of Section 3 hereof or under the penultimate sentence of
this Section 2(b), and shall use its reasonable best efforts to cause such Shelf
Registration Statement to be declared effective by the SEC as soon as
practicable. No Holder of Registrable Securities shall be entitled to include
any of its Registrable Securities in any Shelf Registration pursuant to this
Agreement unless and until such Holder agrees in writing to be bound by all of
the provisions of this Agreement applicable to such Holder and 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 SEC 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 to the Company all information with respect to such Holder necessary
to make the information previously furnished to the Company by such Holder not
materially misleading.
The Company agrees to use its reasonable best efforts to keep the Shelf
Registration Statement continuously effective and the Prospectus usable for
resales for the earlier of: (a) the Rule 144(k) Period or (b) such time as all
of the securities covered by the Shelf Registration Statement have been sold
pursuant to the Shelf Registration Statement or cease to be Registrable
Securities (the "EFFECTIVENESS PERIOD"). The Company shall not permit any
securities other than (i) the Company's issued and outstanding securities
currently possessing incidental registration rights and (ii) 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 of Registrable Securities covered thereby a reasonable number of copies
of the Prospectus which is a part of the Shelf Registration Statement, notify
each such Holder when the Shelf Registration has become effective and take any
other action required to permit unrestricted resales of the Registrable
Securities. The Company further agrees, if necessary, to supplement or amend the
Shelf Registration Statement, if required by the rules, regulations or
instructions applicable to the registration form used by the Company for such
Shelf Registration Statement or by the Securities Act or by any other rules and
regulations thereunder for shelf registrations, and the Company agrees to
furnish to the Holders of Registrable Securities covered by such Shelf
Registration Statement copies of any such supplement or amendment promptly after
its being used or filed with the SEC.
(c) EXPENSES. The Company shall pay all Registration Expenses in connection
with any Registration Statement filed pursuant to Section 2(a) and/or 2(b)
hereof and will reimburse the Initial Purchasers for the reasonable fees and
disbursements of Xxxxx & Wood LLP incurred in connection with the Exchange
Offer. Except as provided herein, each Holder shall pay all expenses of its
counsel, underwriting discounts and commissions and transfer taxes, if any,
7
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 SEC; PROVIDED, HOWEVER, that if,
after it has been declared effective, the offering of Registrable Securities
pursuant to such Exchange Offer Registration Statement or Shelf Registration
Statement is interfered with by any stop order, injunction or other order or
requirement of the SEC or any other governmental agency or court, such Exchange
Offer Registration Statement or Shelf 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. The Company will be deemed not to have used its reasonable best
efforts to cause the Exchange Offer Registration Statement or the Shelf
Registration Statement, as the case may be, to become, or to remain, effective
during the requisite period if they voluntarily take any action that would
result in any such Registration Statement not being declared effective or that
would result in the Holders of Registrable Securities covered thereby not being
able to exchange or offer and sell such Registrable Securities during that
period, unless such action is required by applicable law.
(e) SPECIAL INTEREST PREMIUM. In the event that:
(i) the Exchange Offer Registration Statement is not filed with the
SEC on or prior to the 150th day after the Issue Date, then, commencing on the
151st day after the Issue Date, a special interest premium (the "Special
Interest Premium") shall accrue on the principal amount of the Securities at a
rate of 0.25% per annum;
(ii) the Exchange Offer Registration Statement is not declared
effective by the SEC on or prior to the 180th day after the Issue Date, then,
commencing on the 181st day after the Issue Date, a Special Interest Premium
shall accrue on the principal amount of the Securities at a rate of 0.25% per
annum;
(iii) (A) the Company has not exchanged Exchange Securities for all
Securities validly tendered in respect of the Exchange Securities, in accordance
with the terms of the Exchange Offer on or prior to the 225th day after the
Issue Date or (B) if the Shelf Registration Statement is required to be filed
pursuant to Section 2(b) but is not declared effective by the SEC on or prior to
the 225th day after the Issue Date, then, commencing on the 226th day after the
Issue Date, a Special Interest Premium shall accrue on the principal amount of
the Securities at the rate of 0.25% per annum; or
(iv) the Shelf Registration Statement has been declared effective and
such Shelf Registration Statement ceases to be effective or the Prospectus
ceases to be usable for resales (A) at any time prior to the expiration of the
Effectiveness Period or (B) if related to corporate developments, public filings
or similar events or to correct a material misstatement or omission in the
Prospectus, for more than 60 days (whether or not consecutive) in any
twelve-month period, then a Special Interest Premium shall accrue on the
principal amount of the Securities at a
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rate of 0.25% per annum commencing on the day (in the case of (A) above), or the
61st day after (in the case of (B) above), such Shelf Registration Statement
ceases to be effective or the Prospectus ceases to be usable for resales;
PROVIDED, HOWEVER, that the aggregate amount of the Special Interest Premium in
respect of the Securities may not exceed 0.25% per annum; PROVIDED, FURTHER,
HOWEVER, that (1) upon the filing of the Exchange Offer Registration Statement
(in the case of clause (i) above), (2) upon the effectiveness of the Exchange
Offer Registration Statement (in the case of clause (ii) above), (3) upon the
exchange of Exchange Securities for all Securities validly tendered (in the case
of clause (iii)(A) above) or upon the effectiveness of the Shelf Registration
Statement (in the case of clause (iii) (B) above) or (4) the earlier of (y) such
time as the Shelf Registration Statement which had ceased to remain effective or
the Prospectus which had ceased to be usable for resales again becomes effective
and usable for resales and (z) the expiration of the Effectiveness Period (in
the case of clause (iv) above), the Special Interest Premium on the principal
amount of the Securities as a result of such clause (or the relevant subclause
thereof) shall cease to accrue;
PROVIDED, FURTHER, HOWEVER, that if the Exchange Offer Registration Statement is
not declared effective by the SEC on or prior to the 225th day after the Issue
Date and the Company shall request Holders to provide the information required
by the SEC for inclusion in the Shelf Registration Statement, the Securities
owned by Holders who do not provide such information when required pursuant to
Section 2(b) will not be entitled to any Special Interest Premium for any day
after the 225th day after the Issue Date.
Any Special Interest Premium due pursuant to Section 2(e)(i), (ii), (iii)
or (iv) above will be payable in cash on the next succeeding May 1 or November
1, as the case may be, to Holders on the relevant record dates for the payment
of interest pursuant to the Indenture.
(f) SPECIFIC ENFORCEMENT. Without limiting the remedies available to 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 may result in
material irreparable injury to 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, 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.
SECTION 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 use its reasonable best efforts to:
(a) prepare and file with the SEC a Registration Statement or Registration
Statements as prescribed by Sections 2(a) and 2(b) hereof within the relevant
time period specified in Section 2 hereof on the appropriate form under the
Securities Act, which form shall (i) be selected by the Company, (ii) in the
case of a Shelf Registration, be available for the sale of the Registrable
Securities by the selling Holders thereof and, in the case of an Exchange Offer,
be available for the exchange of Registrable Securities, and (iii) comply as to
form in all material respects with the requirements of the applicable form and
include all financial statements required by the SEC to be
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filed therewith; the Company shall use its reasonable best efforts to cause such
Registration Statement to become effective and remain effective (and, in the
case of a Shelf Registration Statement, the Prospectus to be usable for resales)
in accordance with Section 2 hereof; 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 Securities Act by any Participating Broker-Dealer who seeks
to sell Exchange Securities, before filing any Registration Statement or
Prospectus or any amendments or supplements thereto, the Company shall furnish
to and afford the Holders of the Registrable Securities 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; and the Company shall not file any Registration Statement
or Prospectus or any amendments or supplements thereto in respect of which the
Holders must be afforded an opportunity to review prior to the filing of such
document if the Majority Holders of the Registrable Securities, depending solely
upon which Holders must be afforded the opportunity of such review, or such
Participating Broker-Dealer, as the case may be, their counsel or the managing
underwriters, if any, shall reasonably object in a timely manner;
(b) prepare and file with the SEC such amendments and post-effective
amendments to each Registration Statement as may be necessary to keep such
Registration Statement effective for the Effectiveness Period or the Applicable
Period, as the case may be, and cause each Prospectus to be supplemented, if so
determined by the Company or requested by the SEC, 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 Securities Act, and comply with the
provisions of the Securities 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 of
Registrable Securities included in the Shelf Registration Statement, at least
three 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 of the Registrable Securities, (ii)
furnish to each Holder of Registrable Securities included in the Shelf
Registration Statement 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) consent to the use of the Prospectus or
any amendment or supplement thereto by each of the selling Holders of
Registrable Securities included in the Shelf Registration Statement in
connection with the offering and sale of the Registrable Securities covered by
the Prospectus or any amendment or supplement thereto;
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(d) in the case of a Shelf Registration, register or qualify the
Registrable Securities under all applicable state securities or "blue sky" laws
of such jurisdictions by the time the applicable Registration Statement is
declared effective by the SEC as any Holder of Registrable Securities covered by
a Registration Statement and each underwriter of an underwritten offering of
Registrable Securities shall reasonably request in writing in advance of such
date of effectiveness, and do any and all other acts and things which may be
reasonably necessary or advisable to enable such 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 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) (1) in the case of a Shelf Registration or (2) if Participating
Broker-Dealers from whom the Company have received prior written notice 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 Securities and are required to deliver Prospectuses, promptly notify
each Holder of Registrable Securities, or such Participating Broker-Dealers, as
the case may be, their counsel and the managing underwriters, if any, and
promptly confirm such notice in writing (i) when a Registration Statement has
become effective and when any post-effective amendments thereto become
effective, (ii) of any request by the SEC 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 SEC or any state securities authority of any stop
order suspending the effectiveness of a Registration Statement or the
qualification of the Registrable Securities or the Exchange Securities to be
offered or sold by any Participating Broker-Dealer in any jurisdiction described
in Section 3(d) hereof 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 purchase agreement, securities sales agreement or other similar agreement
cease to be true and correct in all material respects, (v) of the happening of
any event or the failure of any event to occur or the discovery of any facts,
during the Effectiveness Period, which makes any statement made in such
Registration Statement or the related Prospectus untrue in any material respect
or which causes such Registration Statement or Prospectus to 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, as well as any
other corporate developments, public filings with the SEC or similar events
causing such Registration Statement not to be effective or the Prospectus not to
be useable for resales and (vi) of the reasonable determination of the Company
that a post-effective amendment to the Registration Statement would be
appropriate;
(f) obtain the withdrawal of any order suspending the effectiveness of a
Registration Statement at the earliest possible moment;
11
(g) in the case of a Shelf Registration, furnish to each Holder of
Registrable Securities included within the coverage of such Shelf Registration
Statement, without charge, at least one conformed copy of each Registration
Statement relating to such Shelf Registration 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
of Registrable Securities to facilitate the timely preparation and delivery of
certificates representing Registrable Securities to be sold and not bearing any
restrictive legends (except any customary legend borne by securities held
through The Depository Trust Company or any similar depository) and in such
denominations (consistent with the provisions of the Indenture and the officers'
certificate establishing the forms and the terms of the Securities pursuant to
the Indenture) and registered in such names as the selling Holders or the
underwriters may reasonably request at least two Business Days prior to the
closing of any sale of Registrable Securities pursuant to such Shelf
Registration Statement;
(i) in the case of a Shelf Registration or an Exchange Offer Registration,
promptly after the occurrence of any event specified in Section 3(e)(ii),
3(e)(iii), 3(e)(v) (subject to a 60-day grace period within any twelve-month
period) or 3(e)(vi) hereof, prepare a supplement or post-effective amendment to
such Registration Statement or the related Prospectus or any document
incorporated therein by reference or file any other required document so that,
as thereafter delivered to the purchasers of the Registrable Securities, such
Prospectus will not include any untrue statement of a material fact or omit to
state a material fact necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading; and the Company
shall notify each Holder to suspend use of the Prospectus as promptly as
practicable after the occurrence of such an event, 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) obtain a CUSIP number for the Exchange Securities or the Registrable
Securities, as the case may be, not later than the effective date of a
Registration Statement, and provide the Trustee with certificates for the
Exchange Securities or the Registrable Securities, as the case may be, in a form
eligible for deposit with the Depositary;
(k) cause the Indenture to be qualified under the Trust Indenture Act of
1939, as amended (the "TIA"), in connection with the registration of the
Exchange Securities or Registrable Securities, as the case may be, and effect
such changes to such documents as may be required for them to be so qualified in
accordance with the terms of the TIA and execute, and cause the Trustee to
execute, all documents as may be required to effect such changes, and all other
forms and documents required to be filed with the SEC to enable such documents
to be so qualified in a timely manner;
(l) in the case of a Shelf Registration, enter into such agreements
(including underwriting agreements) as are customary in underwritten offerings
and take all such other appropriate actions in connection therewith as are
reasonably requested by the Holders of at least 25% in
12
aggregate principal amount of the Registrable Securities in order to expedite or
facilitate the registration or the disposition of the Registrable Securities;
(m) in the case of a Shelf Registration, whether or not an underwriting
agreement is entered into and whether or not the registration is an underwritten
registration, if requested by (x) an Initial Purchaser, in the case where such
Initial Purchaser holds Securities acquired by it as part of its initial
placement and Holders of at least 25% in aggregate principal amount of the
Registrable Securities covered thereby: (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 as then
conducted and the Registration Statement, Prospectus and 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 offerings, and
confirm the same if and when requested; (ii) obtain opinions of counsel to the
Company and updates thereof (which may be in the form of a reliance letter) in
form and substance reasonably satisfactory to the managing underwriters (if any)
and the Holders of a majority in 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 offerings
and such other matters as may be reasonably requested by such underwriters (it
being agreed that the matters to be covered by such opinion may be subject to
customary qualifications and exceptions); (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 its subsidiaries (and, if necessary, any other independent
certified public accountants 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 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 offerings and such other matters as reasonably requested by such
underwriters in accordance with Statement on Auditing Standards No. 72; and (iv)
if an underwriting agreement is entered into, the same shall 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) customary
for such agreements with respect to all parties to be indemnified pursuant to
said Section (including, without limitation, such underwriters and selling
Holders); and in the case of an underwritten registration, the above
requirements shall be satisfied at each closing under the related underwriting
agreement or as and to the extent required thereunder;
(n) if (1) a Shelf Registration is filed 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 Securities Act by any
Participating Broker-Dealer who seeks to sell Exchange Securities during the
Applicable Period, make reasonably available for inspection by any selling
Holder of Registrable Securities or Participating Broker-Dealer, as applicable,
who certifies to the Company that it has a current intention to sell Registrable
Securities pursuant to the Shelf Registration, any underwriter participating in
any such disposition of Registrable Securities, if any, and any attorney,
accountant or other agent retained by any such selling
13
Holder, Participating Broker-Dealer, as the case may be, or underwriter
(collectively, the "INSPECTORS"), at the offices where normally kept, during the
Company's normal business hours, all financial and other records, pertinent
organizational and operational documents and properties of the Company and its
subsidiaries (collectively, the "RECORDS") as shall be reasonably necessary to
enable them to conduct due diligence activities, and cause the officers,
trustees and employees of the Company and its subsidiaries to supply all
relevant information in each case reasonably requested by any such Inspector in
connection with such Registration Statement; records and information which the
Company determines, in good faith, to be confidential and any Records and
information which it notifies the Inspectors are confidential shall not be
disclosed to any Inspector except where (i) the disclosure of such Records or
information is necessary to avoid or correct a material misstatement or omission
in such Registration Statement, (ii) the release of such Records or information
is ordered pursuant to a subpoena or other order from a court of competent
jurisdiction or is necessary in connection with any action, suit or proceeding
or (iii) such Records or information previously has been made generally
available to the public; each selling Holder of such Registrable Securities and
each such Participating Broker-Dealer will be required to agree in writing that
Records and 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 through no fault of an Inspector or a selling
Holder; and each selling Holder of such Registrable Securities and each such
Participating Broker-Dealer will be required to further agree in writing that it
will, upon learning that disclosure of such Records or information is sought in
a court of competent jurisdiction, or in connection with any action, suit or
proceeding, give notice to the Company and allow the Company at its expense to
undertake appropriate action to prevent disclosure of the Records and
information deemed confidential;
(o) comply with all applicable rules and regulations of the SEC so long as
any provision of this Agreement shall be applicable and make generally available
to its securityholders earning statements satisfying the provisions of Section
11(a) of the Securities Act and Rule 158 thereunder (or any similar rule
promulgated under the Securities Act) no later than 45 days after the end of any
12-month period (or 60 days after the end of any 12-month period if such period
is a fiscal year) (i) commencing at the end of any fiscal quarter in which
Registrable Securities are sold to underwriters in a firm commitment or best
efforts underwritten offering and (ii) if not sold to underwriters in such an
offering, commencing on the first day of the first fiscal quarter of the Company
after the effective date of a Registration Statement, which statements shall
cover said 12-month periods, provided that the obligations under this paragraph
(o) shall be satisfied by the timely filing of quarterly and annual reports on
Forms 10-Q and 10-K under the Exchange Act;
(p) upon consummation of an Exchange Offer, if requested by the Trustee,
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, substantially to the effect that the Company has duly authorized,
executed and delivered the Exchange Securities and the Exchange Securities
constitutes a legal, valid and binding obligation of the Company, enforceable
against the Company, in accordance with its terms (with customary exceptions);
14
(q) if an Exchange Offer 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 Securities, the Company
shall xxxx, or cause to be marked, on such Securities delivered by such Holders
that such Securities are being cancelled in exchange for the Exchange
Securities; it being understood that in no event shall such 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) 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 "Plan of
Distribution," which section shall be reasonably acceptable to the Initial
Purchasers 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 SEC with respect to the potential "underwriter" status of
any broker-dealer that holds Registrable Securities acquired for its own account
as a result of market-making activities or other trading activities (a
"PARTICIPATING BROKER-DEALER") and that will be the beneficial owner (as defined
in Rule 13d-3 under the Exchange Act) of Exchange Securities 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 SEC or such positions or
policies, in the reasonable judgment of the Initial Purchasers or such other
representative, represent the prevailing views of the staff of the SEC,
including a statement that any such broker-dealer who receives Exchange
Securities for Registrable Securities pursuant to the Exchange Offer may be
deemed a statutory underwriter and must deliver a prospectus meeting the
requirements of the Securities Act in connection with any resale of such
Exchange Securities, (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 (the Company
hereby consents 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 Securities Act, including
all Participating Broker-Dealers, in connection with the sale or transfer of the
Exchange Securities covered by the Prospectus or any amendment or supplement
thereto), (iii) 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 lawfully delivered 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
under the Securities Act and applicable rules and regulations in order to resell
the Exchange Securities; PROVIDED, HOWEVER, that such period shall not be
required to exceed 225 days (or such longer period if extended pursuant to the
last
15
sentence of Section 3 hereof) (the "APPLICABLE PERIOD"), and (iv) include in the
transmittal letter or similar documentation to be executed by an exchange
offeree in order to participate in the Exchange Offer (x) the following
provision:
"If the exchange offeree is a broker-dealer holding Registrable
Securities acquired for its own account as a result of market-making
activities or other trading activities, it will deliver a prospectus
meeting the requirements of the Securities Act in connection with any
resale of Exchange Securities received in respect of such Registrable
Securities pursuant to the Exchange Offer"; and
(y) a statement to the effect that by a broker-dealer making the
acknowledgment described in clause (x) and by delivering a Prospectus
in connection with the exchange of Registrable Securities, the
broker-dealer will not be deemed to admit that it is an underwriter
within the meaning of the Securities Act; and
(B) in the case of any Exchange Offer Registration Statement, the Company
agrees to deliver to the Initial Purchasers or to another representative of the
Participating Broker-Dealers, if reasonably requested by an Initial Purchaser or
such other representative of Participating Broker-Dealers, on behalf of the
Participating Broker-Dealers upon consummation of the Exchange Offer (i) an
opinion of counsel in form and substance reasonably satisfactory to such Initial
Purchaser or such other representative of the Participating Broker-Dealers,
covering the matters customarily covered in opinions requested in connection
with Exchange Offer Registration Statements and such other matters as may be
reasonably requested (it being agreed that the matters to be covered by such
opinion may be subject to customary qualifications and exceptions), (ii) an
officers' certificate substantially similar to that specified in Section 6(d)
and (e) of the Purchase Agreement and such additional certifications as are
customarily delivered in a public offering of debt securities and (iii) upon the
effectiveness of the Exchange Offer Registration Statement, comfort letters, in
each case, in customary form if permitted by Statement on Auditing Standards No.
72.
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 as may be required by the staff of the SEC to be included
in a Registration Statement. 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. The Company
shall have no obligation to register under the Securities Act the Registrable
Securities of a seller who so fails to furnish such information.
In the case of a Shelf Registration Statement, or if 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
this Section 3(t) hereof are seeking to sell Exchange Securities and are
required to deliver Prospectuses, each Holder agrees that, upon receipt of any
notice from the Company of the occurrence of any event specified in Section
3(e)(ii), 3(e)(iii), 3(e)(v) or 3(e)(vi) 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
16
supplemented or amended Prospectus contemplated by Section 3(i) hereof or until
it is advised in writing (the "ADVICE") 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
Securities, 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 Exchangeable Securities, as the case may be, pursuant
to a Registration Statement, the Company shall use its reasonable best efforts
to file and have declared effective (if an amendment) as soon as practicable
after the resolution of the related matters an amendment or supplement to the
Registration Statement and shall extend the period during which such
Registration Statement is required to be maintained effective and the Prospectus
usable for resales 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 (x) copies of
the supplemented or amended Prospectus necessary to resume such dispositions or
(y) the Advice.
SECTION 4. INDEMNIFICATION AND CONTRIBUTION. (a) In connection with any
Registration Statement, the Company shall indemnify and hold harmless the
Initial Purchasers, each Holder, each underwriter who participates in an
offering of the Registrable Securities, each Participating Broker-Dealer, each
Person, if any, who controls any of such parties within the meaning of Section
15 of the Securities Act or Section 20 of the Exchange Act and each of their
respective directors, officers, employees and agents, as follows:
(i) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, arising out of any untrue statement or alleged untrue
statement of a material fact contained in any Registration Statement (or any
amendment or supplement thereto), covering Registrable Securities or Exchange
Securities, as applicable, or the omission or alleged omission therefrom of a
material fact required to be stated therein, in the light of the circumstances
under which they were made, not misleading;
(ii) against any and all loss, liability, claim, damage and expense
whatsoever, as incurred, to the extent of the aggregate amount paid in
settlement of any litigation, or any investigation or proceeding by any
governmental agency or body, commenced or threatened, or of any claim whatsoever
based upon any such untrue statement or omission, or any such alleged untrue
statement or omission; provided that (subject to Section 4(d) hereof) any such
settlement is effected with the prior written consent of the Company; and
(iii) against any and all expenses whatsoever, as incurred (including the
reasonable fees and disbursements of counsel chosen by such Holder, such
Participating Broker-Dealer, or any underwriter (except to the extent otherwise
expressly provided in Section 4(c) hereof)), reasonably incurred in
investigating, preparing 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 statement or
omission, or any such alleged
17
untrue statement or omission, to the extent that any such expense is not paid
under subparagraph (i) or (ii) of this Section 4(a);
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 made in reliance upon and in
conformity with written information furnished in writing to the Company by the
Initial Purchasers or such Holder, underwriter or Participating Broker-Dealer
for use in a Registration Statement (or any amendment thereto) or any Prospectus
(or any amendment or supplement thereto).
(b) Each Holder agrees, severally and not jointly, to indemnify and hold
harmless the Company, each Initial Purchaser, each underwriter who participates
in the offering of Registrable Securities, each Participating Broker-Dealer, the
other Holders, and each Person, if any, who controls any of such parties within
the meaning of Section 15 of the Securities Act or Section 20 of the Exchange
Act and each of their respective directors, officers, employees and agents,
against any and all loss, liability, claim, damage and expense whatsoever
described in the indemnity contained in Section 4(a) hereof, as incurred, but
only with respect to untrue statements or omissions, or alleged untrue
statements or omissions, made in a Registration Statement (or any amendment
thereto) or any Prospectus (or any amendment or supplement thereto) in reliance
upon and in conformity with written information furnished to the Company by such
Holder expressly for use in such 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.
(c) Each indemnified party shall give notice as promptly as reasonably
practicable to each indemnifying party of any action commenced against it in
respect of which indemnity may be sought hereunder, but failure to so notify an
indemnifying party shall not relieve such indemnifying party from any liability
which it may have under this Section 4 to the extent that it is not materially
prejudiced by such failure as a result thereof, and in any event shall not
relieve it from liability which it may have otherwise on account of this
indemnity agreement. In the case of parties indemnified pursuant to Section 4(a)
or (b) above, counsel to the indemnified parties shall be selected by such
parties. An indemnifying party may participate at its own expense in the defense
of such action; provided, however, that counsel to the indemnifying party shall
not (except with the consent of the indemnified party) also be counsel to the
indemnified party. In no event shall the indemnifying parties be liable for the
fees and expenses of more than one counsel (in addition to local counsel),
separate from their own 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, 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 (whether or not the indemnified parties are actual or potential
parties thereto), unless
18
such settlement, compromise or consent (i) includes an unconditional written
release of each indemnified party from all liability arising out of such
litigation, investigation, proceeding or claim and (ii) does not include a
statement as to or an admission of fault, culpability or a failure to act by or
on behalf of any indemnified party.
(d) If at any time an indemnified party shall have validly requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel, such indemnifying party agrees that it shall be liable for any
settlement of the nature contemplated by Section 4(a)(ii) effected without its
written consent if (i) such settlement is entered into more than 45 days after
receipt by such indemnifying party of the aforesaid request, (ii) such
indemnifying party shall have received notice of the terms of such settlement at
least 30 days prior to such settlement being entered into and (iii) such
indemnifying party shall not have reimbursed such indemnified party in
accordance with such request prior to the date of such settlement.
(e) In order to provide for just and equitable contribution in
circumstances under which any of the indemnity provisions set forth in this
Section 4 is for any reason held to be unenforceable by an indemnified party
although applicable in accordance with its terms, the Company and the Holders
shall contribute to the aggregate losses, liabilities, claims, damages and
expenses of the nature contemplated by such indemnity agreement incurred by the
Company and the Holders, as incurred; PROVIDED, HOWEVER, that 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 that was not
guilty of such fraudulent misrepresentation. As between the Company and the
Holders, such parties shall contribute to such aggregate losses, liabilities,
claims, damages and expenses of the nature contemplated by such indemnity
agreement in such proportion as shall be appropriate to reflect the relative
fault of the Company, on the one hand, and the Holders, on the other hand, with
respect to the statements or omissions which resulted in such loss, liability,
claim, damage or expense, or action in respect thereof, as well as any other
relevant equitable considerations. The relative fault of the Company, on the one
hand, and of the Holders, on the other hand, shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company, on the one hand, or by or on
behalf of the Holders, on the other, and the 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 to be
determined by pro rata allocation or by any other method of allocation that does
not take into account the relevant equitable considerations. For purposes of
this Section 4, each Affiliate of a Holder, and each director, officer and
employee and Person, if any, who controls a Holder or such Affiliate within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act
shall have the same rights to contribution as such Holder and each Person, if
any, who controls the Company within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act shall have the same rights to contribution
as the Company.
SECTION 5. PARTICIPATION IN AN UNDERWRITTEN REGISTRATION. No Holder may
participate in an underwritten registration hereunder unless such Holder (a)
agrees to sell such Holder's
19
Registrable Securities on the basis provided in the underwriting arrangement
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 under the terms of such underwriting arrangements.
SECTION 6. SELECTION OF UNDERWRITERS. The Holders of Registrable Securities
covered by the Shelf Registration Statement who desire to do so may sell the
Securities covered by such Shelf Registration in an underwritten offering,
subject to the provisions of Section 3(l) hereof. In any such 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.
SECTION 7. MISCELLANEOUS.
(a) RULE 144 AND RULE 144A. For so long as the Company is subject to the
reporting requirements of Section 13 or 15 of the Exchange Act and any
Registrable Securities remain outstanding, the Company will file the reports
required to be filed by it under the Securities Act and Section 13(a) or 15(d)
of the Exchange Act and the rules and regulations adopted by the SEC thereunder;
PROVIDED, HOWEVER, that if the Company ceases to be so required to file such
reports, it will, upon the request of any Holder of Registrable Securities, (a)
make publicly available such information as is necessary to permit sales of its
securities pursuant to Rule 144 under the Securities Act, (b) deliver such
information to a prospective purchaser as is necessary to permit sales of its
securities pursuant to Rule 144A under the Securities Act, and (c) take such
further action that is reasonable in the circumstances, in each case, to the
extent required from time to time to enable such Holder to sell its Registrable
Securities without registration under the Securities Act within the limitation
of the exemptions provided by (i) Rule 144 under the Securities Act, as such
rule may be amended from time to time, (ii) Rule 144A under the Securities Act,
as such rule may be amended from time to time, or (iii) any similar rules or
regulations hereafter adopted by the SEC. Upon the request of any Holder of
Registrable Securities, the Company will deliver to such Holder a written
statement as to whether it has complied with such requirements.
(b) NO INCONSISTENT AGREEMENTS. The Company has not entered into, nor will
the Company on or after the date of this Agreement enter into, any agreement
which is inconsistent with the rights granted to the Holders of Registrable
Securities in this Agreement or otherwise conflicts with the provisions hereof.
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 under any such agreements.
(c) 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 a majority in
aggregate principal amount of the
20
outstanding Registrable Securities affected by such amendment, modification,
supplement, waiver or departure; PROVIDED 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. Notwithstanding the foregoing sentence (i) this Agreement may be
amended, without the consent of any Holder of Registrable Securities, by written
agreement signed by the Company and the Initial Purchasers, to cure any
ambiguity, correct or supplement any provision of this Agreement that may be
inconsistent with any other provision of this Agreement or to make any other
provisions with respect to matters or questions arising under this Agreement
which shall not be inconsistent with other provisions of this Agreement, (ii)
this Agreement may be amended, modified or supplemented, and waivers and
consents to departures from the provisions hereof may be given, by written
agreement signed by the Company and the Initial Purchasers to the extent that
any such amendment, modification, supplement, waiver or consent is, in their
reasonable judgment, necessary or appropriate to comply with applicable law
(including any interpretation of the Staff of the SEC) or any change therein and
(iii) to the extent any provision of this Agreement relates to an Initial
Purchaser, such provision may be amended, modified or supplemented, and waivers
or consents to departures from such provisions may be given, by written
agreement signed by such Initial Purchaser and the Company.
(d) NOTICES. All notices and other communications provided for or permitted
hereunder shall be made in writing by hand-delivery, registered first-class
mail, telex, telecopier, or any courier guaranteeing overnight delivery (i) if
to a Holder, at the most current address given by such Holder to the Company by
means of a notice given in accordance with the provisions of this Section 7(d),
which address initially is, with respect to each Initial Purchaser, the address
set forth in the Purchase Agreement; and (ii) if to the Company, initially at
the Company's address set forth in the Purchase Agreement and thereafter at such
other address, notice of which is given in accordance with the provisions of
this Section 7(d).
All such notices and communications shall be deemed to have been duly
given: at the time delivered by hand, if personally delivered; five Business
Days after being deposited in the mail, postage prepaid, if mailed; when
answered back, if telexed; when receipt is acknowledged, if telecopied; and on
the next Business Day, if timely delivered to an air courier guaranteeing
overnight delivery.
Copies of all such notices, demands, or other communications shall be
concurrently delivered by the Person giving the same to the Trustee, at the
address specified in the Indenture.
(e) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the benefit of
and be binding upon the successors, assigns and transferees of the Initial
Purchasers, 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
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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.
(f) THIRD PARTY BENEFICIARIES. Each Holder and any Participating
Broker-Dealer shall be third party beneficiaries of the agreements made
hereunder among the Initial Purchasers and the Company, and the Initial
Purchasers shall have the right to enforce such agreements directly to the
extent it deems such enforcement necessary or advisable to protect its rights or
the rights of Holders hereunder.
(g) COUNTERPARTS. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(h) HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(i) GOVERNING LAW. THIS AGREEMENT SHALL BE DEEMED TO HAVE BEEN MADE IN THE
STATE OF NEW YORK. THE VALIDITY AND INTERPRETATION OF THIS AGREEMENT, AND THE
TERMS AND CONDITIONS SET FORTH HEREIN, SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO ANY
PROVISIONS RELATING TO CONFLICTS OF LAWS.
(j) SEVERABILITY. In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstance, is held
invalid, illegal or unenforceable, the validity, legality and enforceability of
any such provision in every other respect and of the remaining provisions
contained herein shall not be affected or impaired thereby.
(k) SECURITIES 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 its Affiliates
shall not be counted in determining whether such consent or approval was given
by the Holders of such required percentage.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.
U S WEST COMMUNICATIONS, INC.
By: /s/ Xxxx X. Xxxxx
----------------------------------
Name: Xxxx X. Xxxxx
Title: Vice President - Teasurer
Confirmed and accepted as of
the date first above written:
XXXXXXX XXXXX XXXXXX INC.
ABN AMRO INCORPORATED
BANC OF AMERICA SECURITIES LLC
CHASE SECURITIES INC.
By: XXXXXXX XXXXX XXXXXX INC.
By: /s/ Xxxx X. Xxxxxxxx
------------------------------------
Authorized Signatory
For themselves and as Representatives of the
several Initial Purchasers
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