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EXHIBIT 10.26
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EXECUTION COPY
LORAL SPACE & COMMUNICATIONS LTD.
8,000,000 Shares of
6% Series D Convertible Redeemable Preferred Stock
due 2007 (Liquidation Preference of $50 Per Share)
REGISTRATION RIGHTS AGREEMENT
New York, New York
February 18, 2000
Xxxxxx Brothers Inc.
as Representative of the
Purchasers named in Schedule I hereto
c/x Xxxxxx Brothers Inc.
3 World Financial Center
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs:
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Loral Space & Communications Ltd., a Bermuda company (the
"Company"), proposes to issue and sell to you (the "Purchasers"), upon the terms
set forth in the Purchase Agreement dated February 14, 2000 (the "Purchase
Agreement"), among the Company and the Purchasers named in Schedule I hereto,
9,600,000 shares (including up to 1,600,000 shares that the Company has granted
the Purchasers an option to purchase pursuant to the Purchase Agreement) of its
6% Series D Convertible Redeemable Preferred Stock due 2007, par value $0.01 per
share, liquidation preference of $50 per share (the "Preferred Stock") (such
issuance and sale, the "Initial Placement"). The Preferred Stock will be
convertible into shares of Common Stock, par value $.01 per share, of the
Company (the "Common Stock") at the conversion price set forth in the Final
Memorandum (as defined below). For purposes of this Agreement, the term
"Securities" shall refer to the Preferred Stock, all shares of Common Stock
issued (i) as dividends thereon, (ii) on conversion thereof or (iii) in
redemption thereof, and any securities into which such shares of Preferred Stock
or Common Stock shall be converted or into which they shall be changed by
operation of law or otherwise. In satisfaction of a condition to your
obligations under the Purchase Agreement, the Company agrees with you (i) for
your benefit and (ii) for the benefit of the holders of the Securities
(including you) from time to time until the earlier of (i) the second
anniversary of the last Closing Date (as defined below) and (ii) such time as
(A) such Securities shall no longer constitute restricted securities for
purposes of Rule 144(k) of the Act (as defined below) or (B) all such Securities
have been sold pursuant to the Shelf Registration Statement (as defined below)
(each of the foregoing a "Holder" and together the "Holders"), as follows:
1. Definitions. Capitalized terms used herein without
definition shall have their respective meanings set forth in the Purchase
Agreement. As used in this Agreement, the following capitalized defined terms
shall have the following meanings:
"Act" means the Securities Act of 1933 and the rules and
regulations of the Commission promulgated thereunder.
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"Affiliate" of any specified person means any other person that,
directly or indirectly, is in control of, is controlled by, or is under common
control with, such specified person. For purposes of this definition, control of
a person means the power, direct or indirect, to direct or cause the direction
of the management and policies of such person whether by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Closing Date" has the meaning set forth in the Purchase
Agreement.
"Commission" means the Securities and Exchange Commission.
"Damages Payment Date" means each of the quarterly dividend
payment dates set forth in the schedule to the Bye-Laws of the Company setting
forth the terms of the Preferred Stock.
"Exchange Act" means the Securities Exchange Act of 1934 and the
rules and regulations of the Commission promulgated thereunder.
"Final Memorandum" has the meaning set forth in the Purchase
Agreement.
"First Closing Date" has the meaning set forth in the Purchase
Agreement.
"Holder" has the meaning set forth in the preamble hereto.
"Incorporated Documents" means filings made by the Company with
the Commission pursuant to Section 13, 14 or 15 of the Exchange Act and
incorporated by reference in the Shelf Registration Statement.
"Initial Placement" has the meaning set forth in the preamble
hereto.
"Majority Holders" means the Holders of a majority of the shares
of the Preferred Stock entitled to be registered under a Shelf Registration
Statement; provided,
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however, that Holders of Common Stock issued in respect of the Preferred Stock
shall be deemed to be Holders of the number of shares of Preferred Stock which,
when converted, would have resulted in such number of shares of Common Stock.
"Managing Underwriters" means the investment banker or
investment bankers and manager or managers that shall administer an underwritten
offering of the securities covered by the Shelf Registration Statement.
"Preferred Stock" has the meaning set forth in the preamble
hereto.
"Prospectus" means the prospectus included in any Shelf
Registration Statement, as amended or supplemented by any prospectus supplement,
with respect to the terms of the offering of any portion of the Securities or
Common Stock issuable upon conversion thereof covered by such Shelf Registration
Statement, and all amendments and supplements to the Prospectus, including
post-effective amendments.
"Securities" has the meaning set forth in the preamble hereto.
"Shelf Registration Period" has the meaning set forth in Section
2(b) hereof.
"Shelf Registration Statement" means a "shelf" registration
statement of the Company pursuant to the provisions of Section 2 hereof which
covers some of or all the Securities, on an appropriate form under Rule 415
under the Act or any similar rule that may be adopted by the Commission, and all
amendments and supplements to such registration statement, including
post-effective amendments, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by reference
therein.
"Transfer Agent" means The Bank of New York.
"Transfer Restricted Securities" means each Security until the
earlier of (i) the second anniversary of the last Closing Date and (ii) such
time as (A) such Security shall no longer constitute a restricted security
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for purposes of Rule 144(k) of the Act or (B) such Security has been sold
pursuant to the Shelf Registration Statement.
"underwriter" means any underwriter of Securities in connection
with an offering thereof under a Shelf Registration Statement.
2. Shelf Registration; Suspension of Use of Prospectus.
(a) The Company shall prepare and not later than 90 days
following the First Closing Date, file with the Commission and thereafter use
its reasonable efforts to cause to be declared effective under the Act, as
promptly as practicable but no later than 180 days following the First Closing
Date (the "Effectiveness Target Date"), a registration statement (a "Shelf
Registration Statement"), relating to the offer and sale of the Transfer
Restricted Securities by the Holders from time to time in accordance with the
methods of distribution set forth in such Shelf Registration Statement and Rule
415 under the Securities Act. The sole and exclusive remedy available to the
Holders in the event that a Shelf Registration Statement is not filed or, if
relevant, declared effective within the time periods specified in this Section
2(a) is the collection of additional dividends in accordance with Section 6 and
the terms of the Preferred Stock.
(b) The Company shall use its reasonable efforts to keep the
Shelf Registration Statement continuously effective in order to permit the
Prospectus forming part thereof to be usable by Holders until the earlier of (i)
the second anniversary of the last Closing Date and (ii) such time as (A) the
Securities shall no longer constitute restricted securities for purposes of Rule
144(k) of the Act or (B) all Securities have been sold pursuant to the Shelf
Registration Statement (in any such case, such period being called the "Shelf
Registration Period"). The Company shall be deemed not to have used its
reasonable efforts to keep the Shelf Registration Statement effective during the
requisite period if it voluntarily takes any action that would result in Holders
of Securities covered thereby not to be able to offer and sell such Securities
during that period, unless such action is (i) required by applicable law or (ii)
taken pursuant to Section 2(c) hereof, and, in
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either case, so long as the Company promptly thereafter complies with the
requirements of Section 3(i) hereof, if applicable.
(c) The Company may suspend the use of the Prospectus for a
period not to exceed 60 days (or such longer period as is reasonably necessary
under the circumstances) in any calendar year for valid business reasons (not
including avoidance of the Company's obligations hereunder), including the
acquisition or divestiture of assets, public filings with the Commission,
pending corporate developments and similar events.
(d) Notwithstanding any other provisions of this Agreement
to the contrary, the Company shall cause any Shelf Registration Statement and
the related prospectus and any amendment or supplement thereto, as of the
effective date of the Shelf Registration Statement, amendment or supplement, (i)
to comply in all material respects with the applicable requirements of the Act
and (ii) not to contain any 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, in light of the circumstances under which they were made,
not misleading.
3. Registration Procedures. In connection with any Shelf
Registration Statement, the following provisions shall apply:
(a) The Company shall furnish to you, prior to the filing
thereof with the Commission, a copy of any Shelf Registration Statement,
and each amendment thereof and each amendment or supplement, if any, to
the Prospectus included therein and shall use its best efforts to
reflect in each such document, when so filed with the Commission, such
comments as you reasonably may propose; provided, however, that the
Company shall be required only to furnish an Incorporated Document to
you as promptly as practicable following its filing with the Commission.
(b) The Company shall ensure that (i) any Shelf Registration
Statement and any amendment thereto and any Prospectus forming part
thereof and any amendment or supplement thereto complies in all material
respects
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with the Act, (ii) any Shelf 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 to make the statements therein not
misleading and (iii) any Prospectus forming part of any Shelf
Registration Statement, and any amendment or supplement to such
Prospectus, 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.
(c) (1) The Company shall advise you and the Holders and, if
requested by you or any such Holder, confirm such advice in writing:
(i) when a Shelf Registration Statement and any
amendment thereto has been filed with the Commission and when
the Shelf Registration Statement or any post-effective amendment
thereto has become effective; and
(ii) of any request by the Commission for amendments
or supplements to the Shelf Registration Statement or the
Prospectus included therein or for additional information.
(2) The Company shall advise you and the Holders and, if
requested by you or any such Holder, confirm such advice in writing:
(i) of the issuance by the Commission of any stop
order suspending the effectiveness of the Shelf Registration
Statement or the initiation of any proceedings for that purpose;
(ii) of the receipt by the Company of any
notification with respect to the suspension of the qualification
of the Securities included in any Shelf Registration Statement
for sale in any jurisdiction or the initiation or threatening of
any proceeding for such purpose; and
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(iii) of the suspension of the use of the Prospectus
pursuant to Section 2(c) hereof or of the happening of any event
that requires the making of any changes in the Shelf
Registration Statement or the Prospectus so that, as of such
date, 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 (in the case of the
Prospectus, in light of the circumstances under which they were
made) not misleading (which advice shall be accompanied by an
instruction to suspend the use of the Prospectus until the
requisite changes have been made); provided that such notice
shall not be required to specify the nature of the event giving
rise to the notice requirement hereunder.
(d) The Company shall use its reasonable best efforts to
obtain the withdrawal of any order suspending the effectiveness of any
Shelf Registration Statement at the earliest possible time.
(e) The Company shall furnish to each Holder of Securities
included within the coverage of any Shelf Registration Statement,
without charge, at least one copy of such Shelf Registration Statement
and any post-effective amendment thereto, including documents
incorporated by reference therein, financial statements and schedules,
and, if the Holder so requests in writing, all exhibits (including those
incorporated by reference).
(f) The Company shall, during the Shelf Registration Period,
deliver to each Holder of Securities 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 the Company consents to the use
of the Prospectus or any amendment or supplement thereto by each of the
selling Holders of Securities in connection with the offering and sale
of the Securities covered by the Prospectus or any amendment or
supplement thereto.
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(g) Prior to any offering of Securities pursuant to any
Shelf Registration Statement, the Company shall register or qualify or
cooperate with the Holders of Securities included therein and their
respective counsel in connection with the registration or qualification
of such Securities for offer and sale under the securities or blue sky
laws of such jurisdictions as any such Holders reasonably request in
writing and do any and all other acts or things reasonably necessary or
advisable to enable the offer and sale in such jurisdictions of the
Securities covered by such Shelf Registration Statement; provided,
however, that the Company will not be required to qualify generally to
do business in any jurisdiction where it is not then so qualified 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.
(h) The Company shall cooperate with the Holders of
Securities to facilitate the timely preparation and delivery of
certificates representing Securities to be sold pursuant to any Shelf
Registration Statement free of any restrictive legends and in such
denominations and registered in such names as Holders may request prior
to sales of Securities pursuant to such Shelf Registration Statement.
(i) Upon the occurrence of any event contemplated by
paragraph (c)(2)(iii) above, the Company shall, if required pursuant to
the Act or paragraph (c)(2)(iii) above, as promptly as practicable
prepare a post-effective amendment to any Shelf Registration Statement
or an amendment or supplement to the related Prospectus or file any
other required document so that, as thereafter delivered to purchasers
of the Securities included therein, the Prospectus will not include an
untrue statement of a material fact or omit to state any material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
(j) Not later than the effective date of any Shelf
Registration Statement hereunder, the Company
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shall provide a CUSIP number for each class of Securities registered
under such Shelf Registration Statement, and provide the Transfer Agent
with printed certificates for such Securities, in a form eligible for
deposit with The Depository Trust Company.
(k) The Company shall use its best efforts to comply with
all applicable rules and regulations of the Commission and shall make
generally available to its security holders as soon as practicable after
the effective date of the applicable Shelf Registration Statement an
earnings statement satisfying the provisions of Section 11(a) of the
Act.
(l) The Company may require each Holder of Securities to be
sold pursuant to any Shelf Registration Statement to furnish to the
Company such information regarding the Holder and the distribution of
such Securities as the Company may from time to time reasonably require
for inclusion in such Shelf Registration Statement. Any Holder who fails
to provide such information shall not be entitled to use the Prospectus.
(m) The Company shall, if requested, promptly incorporate in
a prospectus supplement or post-effective amendment to a Shelf
Registration Statement, such information as the Managing Underwriters
and Majority Holders reasonably agree should be included therein and
shall make all required filings of such prospectus supplement or
post-effective amendment as soon as notified of the matters to be
incorporated in such prospectus supplement or post-effective amendment.
(n) The Company shall enter into such agreements (including
underwriting agreements) and take all other appropriate actions in order
to expedite or facilitate the registration or the disposition of any
Securities, and in connection therewith, if an underwriting agreement is
entered into, cause the same to contain indemnification provisions and
procedures no less favorable than those set forth in Section 5 (or such
other provisions and procedures acceptable to the Majority Holders and
the Managing Underwriters, if any), with respect to all parties to be
indemnified
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pursuant to Section 5, it being understood that all underwriting
discounts and commissions, and all other underwriting fees, associated
with such agreement in connection with such offering of the Securities
shall, except as otherwise expressly agreed herein (including those
expenses covered by Section 4), be for the account of the Holders or the
underwriters.
(o) The Company shall (i) make reasonably available for
inspection by Holders of Securities to be registered thereunder and any
Managing Underwriter participating in any disposition pursuant to such
Shelf Registration Statement, and any attorney, accountant or other
agent retained by the Majority Holders of Securities to be registered
thereunder or by any such Managing Underwriter all relevant financial
and other records, pertinent corporate documents and properties of the
Company; (ii) cause the officers, directors and employees of the Company
to supply all relevant information reasonably requested by any such
Holders or Managing Underwriter, attorney, accountant or agent in
connection with such Shelf Registration Statement as is customary for
similar due diligence examinations; provided, however, that any
information that is designated in writing by the Company in good faith,
as confidential at the time of delivery of such information shall be
kept confidential by any such Holders and Managing Underwriter,
attorney, accountant or agent, unless disclosure thereof is made in
connection with a court proceeding or required by law, or such
information has become available (not in violation of this Agreement) to
the public generally or through a third party without an accompanying
obligation of confidentiality; (iii) make such representations and
warranties to the Holders of Securities registered thereunder and the
underwriters, if any, in form, substance and scope as are customarily
made by issuers to underwriters in primary underwritten offerings and
covering matters including those set forth in the Purchase Agreement;
(iv) obtain opinions of counsel to the Company and updates thereof
(which counsel and opinions (in form, scope and substance) shall be
reasonably satisfactory to the Holders and Managing Underwriter, if any)
addressed to each selling Holder and the underwriters, if any, covering
such
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matters as are customarily covered in opinions requested in underwritten
offerings and such other matters as may be reasonably requested by the
Majority Holders of the Securities covered by such Shelf Registration
Statement and by such Managing Underwriter; (v) obtain "cold comfort"
letters and updates thereof from the independent certified public
accountants of the Company (and, if necessary, use its reasonable best
efforts to retain any other independent certified public accountants of
any subsidiary of the Company or of any business acquired by the Company
for which financial statements and financial data are, or are required
to be, included in the Shelf Registration Statement), addressed to each
selling Holder of Securities registered thereunder and the underwriters,
if any, in customary form and covering matters of the type customarily
covered in "cold comfort" letters in connection with primary
underwritten offerings; and (vi) deliver such documents and certificates
as may be reasonably requested by the Majority Holders and the Managing
Underwriters, if any, including those to evidence compliance with
Section 3(i) and with any customary conditions contained in the
underwriting agreement or other agreement entered into by the Company.
The foregoing actions set forth in clauses (iii), (iv), (v) and (vi) of
this Section 3(o) shall be performed at (A) the effectiveness of such
Shelf Registration Statement and each post-effective amendment thereto
and (B) each closing under any underwriting or similar agreement as and
to the extent required thereunder.
4. Registration Expenses. The Company shall bear all
expenses incurred in connection with the performance of the Company's
obligations under Sections 2 and 3 hereof and shall reimburse the Holders for
the reasonable and duly documented fees and disbursements of (i) counsel
designated by the Majority Holders to act as counsel for the Holders in
connection therewith or (ii) in the absence of such selection of counsel by the
Majority Holders, one firm designated by the underwriters to act as counsel for
the Holders in connection therewith. It is understood, however, that as except
provided in this Section 4, the Holders shall pay all their own costs and
expenses, including stock transfer taxes due upon resale by them of any of the
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Securities covered by a Shelf Registration Statement and any advertising
expenses incurred in connection with any offers and sales they make.
5. Indemnification and Contribution. (a) In connection with
any Shelf Registration Statement, the Company agrees to indemnify and hold
harmless each Holder of the securities covered thereby (including the
Purchasers), the directors, officers, employees and agents of each such Holder
and each person who controls any such Holder within the meaning of either the
Act or the Exchange Act against any and all losses, claims, damages or
liabilities, joint or several, to which they or any of them may become subject
under the Act, the Exchange Act or other Federal or state statutory law or
regulation, at common law or otherwise, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of a material fact contained in
the Shelf Registration Statement as originally filed or in any amendment
thereof, or in any preliminary Prospectus or Prospectus, or in any amendment
thereof or supplement thereto, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and agrees to
reimburse each such indemnified party, as incurred, for any legal or other
expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that (i) the Company will not be liable in any case to the extent that any such
loss, claim, damage or liability arises out of or is based upon any such untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished to
the Company by or on behalf of any such Holder specifically for inclusion
therein, (ii) the Company shall not be liable to any indemnified party under
this indemnity agreement with respect to any Shelf Registration Statement or
Prospectus to the extent that any such loss, claim, damage or liability of such
indemnified party results solely from an untrue statement of a material fact
contained in, or the omission of a material fact from, the Shelf Registration
Statement or Prospectus which untrue statement or omission was corrected in an
amended or supplemented Shelf Registration Statement or Prospectus, if (A) the
person
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alleging such loss, claim, damage or liability was not sent or given, at or
prior to the written confirmation of such sale, a copy of the amended or
supplemented Shelf Registration Statement or Prospectus, (B) the Company had
previously furnished copies thereof to such indemnified party and (C) such
delivery of a prospectus is finally judicially determined to be required by the
Act and was not so made and (iii) the Company will not be liable to any
indemnified party under this indemnity agreement with respect to any Shelf
Registration Statement or Prospectus to the extent that any such loss, claim,
damage or liability of such indemnified party results (a) from the use of a
Shelf Registration Statement during a period when a stop order has been issued
in respect thereof or any proceedings for that purpose have been initiated or
(b) from the use of the Prospectus during a period when the use of the
Prospectus has been suspended in accordance with Section 3(c)(2)(iii) hereof,
provided, in each case, that Holders received prior notice of such stop order,
initiation of proceedings or suspension. This indemnity agreement will be in
addition to any liability which the Company may otherwise have.
The Company also agrees to indemnify or contribute to Losses, as
provided in Section 5(d), of any underwriters of Securities registered under a
Shelf Registration Statement, their officers and directors and each person who
controls such underwriters on substantially the same basis as that of the
indemnification of the Holders provided in this Section 5(a) and shall, if
requested by any Holder, enter into an underwriting agreement reflecting such
agreement, as provided in Section 3(n) hereof.
(b) Each Holder of Securities covered by a Shelf
Registration Statement (including the Purchasers) severally agrees to indemnify
and hold harmless (i) the Company, (ii) each of its directors, (iii) each of its
officers who signs such Shelf Registration Statement and (iv) each person who
controls the Company within the meaning of either the Act or the Exchange Act to
the same extent as the foregoing indemnity from the Company to each such Holder,
but only with reference to written information relating to such Holder furnished
to the Company by or on behalf of such Holder specifically for inclusion in the
documents referred to in the foregoing indemnity. This indemnity agreement
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will be in addition to any liability which any such Holder may otherwise have.
(c) Promptly after receipt by an indemnified party under
this Section 5 of notice of the commencement of any action, such indemnified
party will, if a claim in respect thereof is to be made against the indemnifying
party under this Section 5, notify the indemnifying party in writing of the
commencement thereof; but the failure so to notify the indemnifying party (i)
will not relieve it from liability under paragraph (a) or (b) above unless and
to the extent it did not otherwise learn of such action and such failure results
in the forfeiture by the indemnifying party of substantial rights and defenses
and (ii) will not, in any event, relieve the indemnifying party from any
obligations to any indemnified party other than the indemnification obligation
provided in paragraph (a) or (b) above. The indemnifying party shall be entitled
to appoint counsel of the indemnifying party's choice at the indemnifying
party's expense to represent the indemnified party in any action for which
indemnification is sought (in which case the indemnifying party shall not
thereafter be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth below);
provided, however, that such counsel shall be reasonably satisfactory to the
indemnified party. Notwithstanding the indemnifying party's election to appoint
counsel to represent the indemnified party in an action, the indemnified party
shall have the right to employ separate counsel (including local counsel), and
the indemnifying party shall bear the reasonable fees, costs and expenses of
such separate counsel (and local counsel) if (i) the use of counsel chosen by
the indemnifying party to represent the indemnified party would present such
counsel with a conflict of interest, (ii) the actual or potential defendants in,
or targets of, any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably concluded
that there may be legal defenses available to it and/or other indemnified
parties which are different from or in addition to those available to the
indemnifying party, (iii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of the institution of such action or (iv) the
indemnifying party shall authorize the
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indemnified party to employ separate counsel at the expense of the indemnifying
party. An indemnifying party will not, without the prior written consent of the
indemnified parties, settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be sought
hereunder (whether or not the indemnified parties are actual or potential
parties to such claim or action) unless such settlement, compromise or consent
includes an unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding.
(d) In the event that the indemnity provided in paragraph
(a) or (b) of this Section 5 is unavailable to or insufficient to hold harmless
an indemnified party for any reason, then each applicable indemnifying party, in
lieu of indemnifying such indemnified party, shall have a joint and several
obligation to contribute to the aggregate losses, claims, damages and
liabilities (including legal or other expenses reasonably incurred in connection
with investigating or defending same) (collectively, "Losses") to which such
indemnified party may be subject in such proportion as is appropriate to reflect
the relative benefits received by such indemnifying party, on the one hand, and
such indemnified party, on the other hand, from the Initial Placement and the
Shelf Registration Statement which resulted in such Losses; provided, however,
that in no case shall the Purchasers be responsible, in the aggregate, for any
amount in excess of the purchase discount or commission applicable to such
Security, nor shall any underwriter be responsible for any amount in excess of
the underwriting discount or commission applicable to the securities purchased
by such underwriter under the Shelf Registration Statement which resulted in
such Losses. If the allocation provided by the immediately preceding sentence is
unavailable for any reason, the indemnifying party and the indemnified party
shall contribute in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of such indemnifying party, on the
one hand, and such indemnified party, on the other hand, in connection with the
statements or omissions which resulted in such Losses as well as any other
relevant equitable considerations. Benefits received by the Company shall be
deemed to be equal to the total net
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proceeds from the Initial Placement (before deducting expenses). Benefits
received by the Purchasers shall be deemed to be equal to the total purchase
discounts and commissions, and benefits received by any other Holders shall be
deemed to be equal to the value such Holders realize by receiving Securities
registered under the Act. Benefits received by any underwriter shall be deemed
to be equal to the total underwriting discounts and commissions, as set forth on
the cover page of the Prospectus forming a part of the Shelf Registration
Statement which resulted in such Losses. Relative fault shall be determined by
reference to whether any alleged untrue statement or omission relates to
information provided by the indemnifying party, on the one hand, or by the
indemnified party, on the other hand. The parties agree that it would not be
just and equitable if contribution were determined by pro rata allocation or any
other method of allocation which does not take account of the equitable
considerations referred to above. Notwithstanding the provisions of this
paragraph (d), no person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. For purposes of
this Section 5, each person who controls a Holder within the meaning of either
the Act or the Exchange Act and each director, officer, employee and agent of
such Holder shall have the same rights to contribution as such Holder, and each
person who controls the Company within the meaning of either the Act or the
Exchange Act, each officer of the Company who shall have signed the Shelf
Registration Statement and each director of the Company shall have the same
rights to contribution as the Company, subject in each case to the applicable
terms and conditions of this paragraph (d).
(e) The provisions of this Section 5 will remain in full
force and effect, regardless of any investigation made by or on behalf of any
Holder or the Company or any of the officers, directors or controlling persons
referred to in Section 5 hereof, and will survive the sale by a Holder of
Securities covered by a Shelf Registration Statement.
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6. Liquidated Damages.
(a) The Company and the Purchasers agree that the
Holders of Transfer Restricted Securities shall suffer damages if the Company
fails to fulfill its obligations pursuant to Section 2 hereof and that it would
not be possible to ascertain the extent of such damages. Accordingly, the
Company hereby agrees to pay liquidated damages ("Preferred Stock Liquidated
Damages") to each Holder of Transfer Restricted Securities under the
circumstances and to the extent set forth below:
(i) from 90 days following the First Closing Date,
if the Shelf Registration Statement is not filed with the
Commission within 90 days following the First Closing Date; and
(ii) from the Effectiveness Target Date if the Shelf
Registration Statement is not effective on or prior to the
Effectiveness Target Date; and
(iii) if the Shelf Registration Statement has been
declared effective by the Commission and such Shelf Registration
Statement ceases to be effective or to be usable as contemplated
by Section 2(b) at any time during the Shelf Registration Period
(without being succeeded by a post-effective amendment to such
Shelf Registration Statement that cures such failure and that is
itself immediately declared effective) for any period of ten
consecutive trading days that are also business days or for any
20 trading days that are also business days in any 180-day
period in connection with resales of Transfer Restricted
Securities (provided, that the Company will have the option of
suspending the effectiveness of the Shelf Registration
Statement, without becoming obligated to pay Preferred Stock
Liquidated Damages, for periods of up to a total of 60 days in
any calendar year if the Board of Directors of the Company
determines that compliance with the disclosure obligations
necessary to maintain the effectiveness of the Shelf
Registration Statement at such time could reasonably be expected
to have an adverse effect on the Company or a pending corporate
transaction)
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(each of the foregoing clauses (i) through (iii), a "Registration Default").
(b) In the event of each such Registration Default, the
Company shall pay Preferred Stock Liquidated Damages to each Holder of shares of
Preferred Stock that are Transfer Restricted Securities at a rate of 0.25% of
the liquidation preference of the shares of Preferred Stock constituting
Transfer Restricted Securities, which shall accrue from the date of the
Registration Default to and including the 90th day following such Registration
Default and increase by 0.25% for each subsequent 90 day period; provided,
however, that the rate of such Preferred Stock Liquidated Damages may not exceed
1.00% of the Liquidation Preference of the Preferred Stock at any time.
Following the cure of all Registration Defaults relating to any shares of
Preferred Stock that are Transfer Restricted Securities, the accrual of
Preferred Stock Liquidated Damages with respect to such shares of Preferred
Stock that are Transfer Restricted Securities shall cease (without in any way
limiting the effect of any subsequent Registration Default). A Registration
Default under clause 6(a)(i) above shall be cured on the date that the Shelf
Registration Statement is filed with the Commission. A Registration Default
under clause 6(a)(ii) above shall be cured on the date that the Shelf
Registration Statement is declared effective by the Commission. A Registration
Default under clause 6(a)(iii) above shall be cured on the date the Shelf
Registration Statement is declared effective or becomes usable.
(c) The Company shall notify the Transfer Agent within one
business day after (i) each and every date on which a Registration Default
occurs and (ii) in the event of a Registration Default under Section 6(a)(i),
the Effectiveness Target Date. Preferred Stock Liquidated Damages shall be paid
by the Company to the record Holders of shares of Preferred Stock that are
Transfer Restricted Securities on each Damages Payment Date by mailing checks to
their registered addresses as they appear in the Preferred Stock register if no
such accounts have been specified on or before the Damages Payment Date;
provided that any Preferred Stock Liquidated Damages accrued with respect to any
Preferred Stock or portion thereof called for redemption on a redemption date or
converted into Common Stock on a conversion date prior to the Damages Payment
Date, shall, in
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any such event, be paid instead to the Holder that submitted such Preferred
Stock for redemption or conversion on the applicable redemption date or
conversion date, as the case may be, on such date (promptly following the
conversion date, in the case of conversion of Preferred Stock). Each obligation
to pay Preferred Stock Liquidated Damages shall be deemed to commence accruing
on the date of the applicable Registration Default and to cease accruing when
all Registration Defaults have been cured.
(d) All Preferred Stock Liquidated Damages with respect to
any shares of Preferred Stock that are Transfer Restricted Securities, that
remain unpaid when such Securities cease to be Transfer Restricted Securities or
cease to be outstanding, shall remain unpaid obligations of the Company until
they have been paid in full.
7. Rules 144 and 144A. The Company shall use its reasonable
efforts to file the reports required to be filed under the Act and the Exchange
Act in a timely manner and, if at any time the Company is not required to file
such reports, will, upon the request of any Holder of Transfer Restricted
Securities, make publicly available other information so long as necessary to
permit sales of its securities pursuant to Rules 144 and 144A. The Company
covenants that it will take such further action as any Holder of Transfer
Restricted Securities may reasonably request, all to the extent required from
time to time to enable such Holder to sell Transfer Restricted Securities
without registration under the Act within the limitation of the exemptions
provided by Rules 144 and 144A (including the requirements of Rule 144A(d)(4)).
The Company will provide a copy of this Agreement to prospective purchasers of
Securities identified to the Company by the Purchasers upon written request.
Upon such request of any Holder of Transfer Restricted Securities, the Company
shall deliver to such Holder a written statement as to whether it has complied
with such requirements. Notwithstanding the foregoing, nothing in this Section 7
shall be deemed to require the Company to register any of its securities
pursuant to the Exchange Act.
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8. Miscellaneous.
(a) No Inconsistent Agreements. The Company has not, as of
the date hereof, entered into, nor shall it, on or after the date
hereof, enter into, any agreement with respect to its securities that is
inconsistent with the rights granted to the Holders herein or otherwise
conflicts with the provisions hereof.
(b) Amendments and Waivers. The provisions of this
Agreement, including the provisions of this sentence, may not be
amended, qualified, 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 the Majority Holders;
provided that, with respect to any matter that directly or indirectly
affects the rights of the Purchasers hereunder, the Company shall obtain
the written consent of the Purchasers against which such amendment,
qualification, supplement, waiver or consent is to be effective.
Notwithstanding the foregoing (except the foregoing proviso), a waiver
or consent to departure from the provisions hereof with respect to a
matter that relates exclusively to the rights of Holders whose
Securities are being sold pursuant to a Shelf Registration Statement and
that does not directly or indirectly affect the rights of other Holders
may be given by the Majority Holders, determined on the basis of
securities being sold rather than registered under such Shelf
Registration Statement.
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(c) 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 overnight
delivery:
(1) if to a Holder, at the most current address
given by such holder to the Company in accordance with the
provisions of this Section 8(c), which address initially is,
with respect to each Holder, the address of such Holder
maintained by the Registrar of the Securities, with a copy in
like manner to Xxxxxx Brothers Inc.;
(2) if to you, initially at the address set forth in
the Purchase Agreement; and
(3) if to the Company, initially at its address set
forth in the Purchase Agreement.
All such notices and communications shall be deemed to have been
duly given when received.
The Purchasers or the Company by notice to the other may
designate additional or different addresses for subsequent notices or
communications.
(d) Successors and Assigns. This Agreement shall inure to
the benefit of and be binding upon the successors and assigns of each of
the parties, including, without the need for an express assignment or
any consent by the Company thereto, subsequent Holders of Securities.
The Company hereby agrees to extend the benefits of this Agreement to
any Holder of Securities and any such Holder may specifically enforce
the provisions of this Agreement as if an original party hereto.
(e) 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.
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(f) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect
the meaning hereof.
(g) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK
WITHOUT REGARD TO THE CONFLICT OF LAW RULES THEREOF.
(h) Jurisdiction; Consent to Service of Process. THE COMPANY
HEREBY IRREVOCABLY AND UNCONDITIONALLY CONSENTS TO SUBMIT TO THE
EXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND OF THE
UNITED STATES DISTRICT COURTS LOCATED IN THE CITY OF NEW YORK FOR ANY
LAWSUITS, CLAIMS OR OTHER PROCEEDINGS ARISING OUT OF OR RELATING TO THIS
AGREEMENT AND AGREES NOT TO COMMENCE ANY SUCH LAWSUIT, CLAIM OR OTHER
PROCEEDING EXCEPT IN SUCH COURTS. THE COMPANY HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES ANY OBJECTION TO THE LAYING OF VENUE OF ANY
LAWSUIT, CLAIM, OR OTHER PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT IN THE COURTS OF THE STATE OF NEW YORK OR THE UNITED STATES
DISTRICT COURTS LOCATED IN THE CITY OF NEW YORK, AND HEREBY FURTHER
IRREVOCABLY AND UNCONDITIONALLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM
IN ANY SUCH COURT THAT ANY SUCH LAWSUIT, CLAIM OR OTHER PROCEEDING
BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. THE
COMPANY HAS APPOINTED XXX XXXX AT 000 XXXXX XXXXXX, XXX XXXX, XXX XXXX
00000, X.X.X. (HEREINAFTER REFERRED TO IN SUCH CAPACITY AS THE "PROCESS
AGENT"), AS ITS AUTHORIZED AGENT UPON WHOM PROCESS MAY BE SERVED IN ANY
SUCH SUIT OR PROCEEDING. THE COMPANY REPRESENTS TO YOU THAT IT HAS
NOTIFIED THE PROCESS AGENT OF SUCH DESIGNATION AND APPOINTMENT AND THAT
THE PROCESS AGENT HAS ACCEPTED THE SAME IN WRITING. THE COMPANY HAS
AUTHORIZED AND DIRECTED THE PROCESS AGENT TO ACCEPT SUCH SERVICE. IF THE
PROCESS AGENT SHALL CEASE TO ACT AS THE COMPANY'S AGENT FOR SERVICE OF
PROCESS, THE COMPANY SHALL APPOINT WITHOUT DELAY ANOTHER SUCH AGENT AND
NOTIFY YOU OF SUCH APPOINTMENT. THE COMPANY FURTHER AGREES THAT SERVICE
OF PROCESS UPON THE PROCESS AGENT AND WRITTEN NOTICE OF SAID SERVICE TO
THE COMPANY MAILED BY FIRST CLASS MAIL OR DELIVERED TO THE PROCESS AGENT
SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE
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SERVICE OF PROCESS UPON IT IN ANY SUCH SUIT OR PROCEEDING. NOTHING
HEREIN SHALL AFFECT YOUR RIGHT OR THE RIGHT OF ANY PERSON CONTROLLING
ANY OF YOU TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW. THE
COMPANY AGREES THAT A FINAL ACTION IN ANY SUCH SUIT OR PROCEEDING SHALL
BE CONCLUSIVE AND MAY BE ENFORCED IN OTHER JURISDICTIONS BY SUIT ON THE
JUDGMENT OR IN ANY OTHER LAWFUL MANNER.
(i) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any
circumstances, is held invalid, illegal or unenforceable in any respect
for any reason, the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions hereof
shall not be in any way impaired or affected thereby, it being intended
that all the rights and privileges of the parties shall be enforceable
to the fullest extent permitted by law.
(j) Securities Held by the Company, etc. Whenever the
consent or approval of Holders of a specified percentage of principal
amount or liquidation preference, as the case may be, of Securities is
required hereunder, Securities held by the Company or their respective
Affiliates (other than subsequent Holders of Securities if such
subsequent Holders are deemed to be Affiliates solely by reason of their
holdings of such Securities) shall not be counted in determining whether
such consent or approval was given by the Holders of such required
percentage.
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If the foregoing is in accordance with your understanding of our
agreement, please sign and return to Xxxxxx Brothers Inc. a counterpart hereof,
whereupon this Agreement will become a binding agreement among the Company and
the several Purchasers in accordance with its terms.
Very truly yours,
LORAL SPACE & COMMUNICATIONS LTD.
by:/s/Xxx Xxxx
-----------------------------
Name: Xxx Xxxx
Title:Vice President, General
Counsel and Secretary
The foregoing Registration
Rights Agreement is hereby confirmed
and accepted as of the date first
above written.
XXXXXX BROTHERS INC.
BANC OF AMERICA SECURITIES LLC
BEAR, XXXXXXX & CO. INC.
ING BARINGS LLC
X.X. XXXXXXXXX, TOWBIN
CREDIT LYONNAIS SECURITIES (USA) INC.
XX XXXXX SECURITIES CORPORATION
by XXXXXX BROTHERS INC.
by
/s/Xxxxx Xxxxx
----------------------------
Name: Xxxxx Xxxxx
Title:Managing Director
