EXHIBIT 10.8
Registration Rights Agreement
This Registration Rights Agreement ("Agreement") is made as of this
12th day of April, 1999 by and among Tenneco Packaging Inc., a Delaware
corporation ("TPI"), PCA Holdings LLC, a Delaware limited liability company
("PCA"), and Packaging Corporation of America, a Delaware corporation ("Newco").
Preliminary Recitals
1. TPI, PCA and Newco are parties to that certain Contribution
Agreement, dated as of January 25, 1999, as amended (the "Contribution
Agreement"), relating to the organization, ownership and management of Newco and
certain other matters.
2. As an inducement to TPI and PCA to enter into and consummate the
transactions contemplated by the Contribution Agreement, Newco has agreed to
provide certain registration rights to TPI and PCA and transferees (to the
extent provided herein) of their equity securities of Newco as provided herein.
NOW, THEREFORE, the parties hereto AGREE as follows:
1. Certain Definitions.
"Common Stock" means the common stock, par value $.01 per share, of
Newco.
"Person" means an individual, a partnership, a corporation, an
association, a joint stock company, a trust, a joint venture, a limited
liability company or other unincorporated organization, and a governmental
entity or any department, agency or political subdivision thereof.
"PIK Securities" means the preferred stock of Newco with a
pay-in-kind feature, as described in the Commitment Letters (as such term is
defined in the Contribution Agreement).
"Registrable Securities" means, as of any date: (i) Common Stock and
PIK Securities issued pursuant to the Contribution Agreement to TPI, PCA or any
of their respective Affiliates on the date hereof; and (ii) any Common Stock or
PIK Securities issued or issuable with respect to the Common Stock or PIK
Securities in the preceding clause (i) by way of or in connection with a stock
dividend, stock split, combination of shares, share subdivision, share exchange,
recapitalization, merger, consolidation or other reorganization or transaction
(including without limitation any PIK Securities issued pursuant to the terms of
PIK Securities). As of any date, Registrable Securities owned by TPI or any of
its Affiliates are sometimes referred to herein as "TPI Registrable Securities."
As of any date, Registrable Securities owned by PCA, by its members which are
members of PCA as of the date hereof or by any of their Affiliates are sometimes
referred to herein as "PCA Registrable Securities." As of any date, Registrable
Securities owned by any direct or indirect transferee of TPI (other than an
Affiliate of TPI) or by any direct or indirect transferee of PCA (other than an
Affiliate of PCA or member of PCA as of the date hereof) are sometimes referred
to herein as "Transferee Registrable Securities." As to any particular
Registrable Securities, such securities will cease to be Registrable Securities
when they have been distributed to the public pursuant to a offering registered
under the Securities Act of 1933, as amended from time to time (the "Securities
Act"), or distributed to the public in compliance with Rule 144 under the
Securities Act. For purposes of this Agreement, a Person will be deemed to be a
holder of Registrable Securities whenever such Person has the right to acquire
directly or indirectly such Registrable Securities (upon conversion or exercise
in connection with a transfer of securities or otherwise, but disregarding any
restrictions or limitations upon the exercise of such right), whether or not
such acquisition has actually been effected.
"Registration Expenses" means any and all expenses incident to
performance of, or compliance with any registration of securities pursuant to,
this Agreement, including, without limitation: (i) the fees, disbursements and
expenses of Newco's counsel and accountants; (ii) the fees, disbursements and
expenses of one or more firms, as applicable pursuant to the terms of this
Agreement, selected as counsel for the holders of the Registrable Securities in
connection with the registration of the securities to be disposed of; (iii) all
expenses, including registration and filing fees, in connection with the
preparation, printing, filing and distribution of the registration statement,
any preliminary prospectus or final prospectus, term sheets and any other
offering documents, and amendments and supplements thereto, and the mailing and
delivering of copies thereof to any underwriters and dealers; (iv) the cost of
printing or producing any underwriting agreements and blue sky or legal
investment memoranda, and any other documents in connection with the offering,
sale or delivery of the securities to be disposed of; (v) all expenses in
connection with the qualification of the securities to be disposed of for
offering and sale under state securities laws, including the fees, disbursements
and expenses of counsel for the underwriters or the holders of the Registrable
Securities in connection with such qualification and in connection with any blue
sky and legal investment surveys; (vi) the filing fees incident to securing any
required review by the National Association of Securities Dealers, Inc. of the
terms of the sale of the securities to be disposed of; (vii) transfer agents'
and registrars' fees and expenses and the fees and expenses of any other agent
or trustee appointed in connection with such offering; (viii) all security
engraving and security printing expenses; (ix) all fees, disbursements and
expenses payable in connection with the listing of the securities on any
securities exchange or automated interdealer quotation system and the rating of
such securities; (x) any other fees, disbursements and expenses of underwriters
customarily paid by the sellers of securities (excluding underwriting discounts
and commissions); (xi) all liability insurance expense; and (xii) other
out-of-pocket expenses of the holders of the Registrable Securities
participating in such registration. Notwithstanding the foregoing, each holder
of the Registrable Securities and Newco shall be responsible for its own
internal administrative and similar costs.
2. Demand Registrations.
(a) General. At any time and from time to time, upon written notice
from either the holders of at least 75% of the TPI Registrable Securities or the
holders of at least 75% of the PCA Registrable Securities requesting that Newco
effect the registration under the Securities Act of any or all the TPI
Registrable Securities or the PCA Registrable Securities, respectively, Newco
shall effect the registration (under the Securities Act and applicable state
securities laws) of such securities (and other Registrable Securities subject to
Sections 2(c) and 2(d) below) in accordance with such notice, Section 5 below
and the other provisions of this Agreement. The notice shall
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specify the approximate number of Registrable Securities to be registered and
the expected per share price range for the offering. A registration pursuant to
this Section 2 is sometimes referred to herein as a "Demand Registration."
(b) Limitations on Demand Registrations; Demand Registration Forms
and Expenses. The holders of the TPI Registrable Securities, on the one hand,
and the holders of the PCA Registrable Securities, on the other hand, each shall
be entitled to separately request pursuant to this Section 2:
(i) three (3) effected registrations on Form S-1 or any
similar or successor long form registration including,
without limitation, Form A contemplated by the
Securities and Exchange Commission ("SEC") in Release
No. 33-7606 dated October 15, 1998 (the "Aircraft
Carrier Release") ("Long-Form Registrations") in which
Newco shall pay all Registration Expenses;
(ii) an unlimited number of registrations on Form S-2 or S-3
or any similar or successor short form registration
including, without limitation, Form B contemplated by
the SEC in the Aircraft Carrier Release ("Short-Form
Registrations") in which Newco shall pay all
Registration Expenses; and
(iii) an unlimited number of Long-Form Registrations in which
the holders of the Registrable Securities participating
in such registration shall pay all Registration
Expenses.
For purposes of clause (iii) above, each holder of securities included in
accordance with this Agreement in any registration pursuant to clause (iii)
shall pay those Registration Expenses allocable to the registration of such
holder's securities so included, and any Registration Expenses not so allocable
will be borne by all sellers of securities included in such registration in
proportion to the aggregate selling price of the securities to be so registered.
Newco shall pay and be solely responsible for Registration Expenses with respect
to registrations effected under clause (i) and (ii) above.
After Newco has become subject to the Securities Exchange Act of
1934, as amended from time to time ("Exchange Act"), Newco will use its
reasonable best efforts to make Short-Form Registrations available for the sale
of Registrable Securities. Demand Registrations will be Short- Form
Registrations whenever Newco is permitted to use any applicable short form;
provided, however, that Newco shall nevertheless use a Long-Form Registration
Statement in the event that both: (i) the use of a Short-Form Registration
Statement would limit the offering to existing security holders, qualified
institutional buyers or other classes of offerees or would otherwise, in the
opinion of the managing underwriters, have an adverse effect on the offering
under the Securities Act and regulations thereunder as then in effect; and (ii)
the holders of 90% of the TPI Registrable Securities or PCA Registrable
Securities, as the case may be, initially requesting the Demand Registration
direct in such request that Newco utilize a Long-Form Registration Statement.
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Notwithstanding any other provision of this Agreement to the
contrary, a registration requested hereunder shall not be deemed to have been
effected: (i) unless it has become and remains effective for the period
specified in Section 5(b); (ii) if after it has become effective such
registration is interfered with by any stop order, injunction or other order or
requirement of the Securities and Exchange Commission ("SEC") or other
governmental agency or court for any reason other than due solely to the fault
of the holders of the Registrable Securities participating therein and, as a
result thereof, the Registrable Securities requested to be registered cannot be
completely distributed in accordance with the plan of distribution set forth in
the registration statement; or (iii) if the conditions to closing specified in
any purchase agreement or underwriting agreement entered into in connection with
any such registration are not satisfied or waived other than due solely to the
fault of the holders of the Registrable Securities participating therein. In
addition, a Demand Registration initially requested by the holders of the TPI
Registrable Securities shall not be deemed to have been effected if the holders
of the TPI Registrable Securities are unable, as a result of the priority
provisions in Section 2(d) below, to sell at least 90% of the TPI Registrable
Securities initially requested to be included in such registration. Similarly, a
Demand Registration initially requested by the holders of the PCA Registrable
Securities shall not be deemed to have been effected if the holders of the PCA
Registrable Securities are unable, as a result of the priority provisions in
Section 2(d) below, to sell at least 90% of the PCA Registrable Securities
initially requested to be included in such registration.
(c) Notice to Other Holders; Selection of Underwriter and Holder's
Counsel. Within five (5) days after receipt of a request for a Demand
Registration, Newco will give prompt written notice (in any event within five
(5) days after its receipt of notice of any exercise of Demand Registration
rights under this Agreement) of such request to all other holders of Registrable
Securities, and subject to Section 2(d) below, will include within such
registration all Registrable Securities with respect to which Newco has received
written requests for inclusion therein within fifteen (15) days after receipt of
Newco's notice. The holders of a majority of the TPI Registrable Securities or
PCA Registrable Securities, as applicable, submitting the initial request (i.e.
excluding the holders submitting requests after Newco's notice) shall have the
right to select the investment bankers and managers for the offering, subject to
the approval of the other holders of the TPI Registrable Securities and PCA
Registerable Securities, if any, participating in such registration pursuant to
this Agreement, which approval shall not be unreasonably withheld.
Counsel for all holders of Registrable Securities in connection with
such registration shall be selected: (i) by the holders of a majority of the TPI
Registrable Securities, if holders of the TPI Registrable Securities make the
initial registration request; or (ii) by the holders of a majority of the PCA
Registrable Securities, if the holders of the PCA Registrable Securities make
the initial registration request; provided, however, if the holders of a
majority of the PCA Registrable Securities, on the one hand, and a majority of
the TPI Registrable Securities, on the other hand, reasonably conclude, after
consultation with the other, that such representation is likely to result in a
conflict of interest or materially adversely affect either group's rights in
connection with such registration, then the holders of a majority of the PCA
Registrable Securities and the holders of a majority of the TPI Registrable
Securities, respectively, shall each be entitled to select a separate firm to
represent them as counsel in connection with such registration. The fees and
expenses of such firm or firms acting as counsel for the holders of the
Registrable Securities shall be paid by
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Newco.
(d) Priority on Demand Registrations. Newco shall not include in any
Demand Registration any securities which are not Registrable Securities without
the prior written consent of the holders of at least 90% of the Registrable
Securities included in such registration. If a Demand Registration is an
underwritten offering and the managing underwriters advise Newco in writing that
in their opinion the number of Registrable Securities and, if permitted
hereunder, other securities requested to be included in such offering exceeds
the number of Registrable Securities and other securities, if any, which can be
sold in an orderly manner in such offering within a price range acceptable to
the holders of a majority of the TPI Registrable Securities or PCA Registrable
Securities, as applicable, initially requesting registration, Newco will include
in such registration:
(A) if requested by the holders of the TPI Registrable
Securities or by the holders of the PCA Registrable Securities at
any time during the 14-month period commencing on the date hereof
(the "Special Priority Period"), only the number of Registrable
Securities which such underwriters advise in writing can be sold in
such manner and within such price range in the following order of
priority:
(i) first, the TPI Registrable Securities, if any, requested
to be included therein, pro-rata among the holders of
such TPI Registrable Securities on the basis of the
number of shares requested to be included by each such
holder;
(ii) second, the PCA Registrable Securities, if any,
requested to be included therein, pro-rata among the
holders of such PCA Registrable Securities on the basis
of the number of shares requested to be included by each
such holder;
(iii) third, the Transferee Registrable Securities, if any,
requested to be included therein, pro-rata among the
holders of such Transferee Registrable Securities on the
basis of the number of shares requested to be included
by each such holder; and
(iv) fourth, any other securities requested to be included in
such registration; and
(B) if requested by the holders of the TPI Registrable
Securities or by the holders of the PCA Registrable Securities at
any time after the Special Priority Period, only the number of
Registrable Securities which such underwriters advise in writing can
be sold in such manner and within such price range in the following
order of priority:
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(i) first, the TPI Registrable Securities and the PCA
Registrable Securities requested to be included therein,
pro-rata among the holders of such Registrable
Securities on the basis of the number of shares
requested to be included by each such holder;
(ii) second, the Transferee Registrable Securities, if any,
requested to be included therein, pro-rata among the
holders of such Transferee Registrable Securities on the
basis of the number of shares requested to be included
by each such holder; and
(iii) third, any other securities requested to be included in
such registration.
(e) Restrictions on Demand Registrations. Newco will not be
obligated to effect any Demand Registration within 90 days after the effective
date of a previous Demand Registration or previous registration in which holders
of Registrable Securities were given piggyback rights pursuant to Section 3 at
an offering price acceptable to the holders of the Registrable Securities and in
which there was no reduction in the number of Registrable Securities requested
to be included. Additionally, Newco may postpone for up to 90 days (on not more
than one occasion during any 12-month period) the filing or the effectiveness of
a registration statement for a Demand Registration if, based on the advice of
counsel, Newco reasonably determines that such Demand Registration would likely
have an adverse effect on any proposal or plan by Newco to engage in any
acquisition of assets (other than in the ordinary course of business) or any
merger, consolidation, tender offer or similar transaction; provided, however,
that in such event, the holders of Registrable Securities initially requesting
such Demand Registration will be entitled to withdraw such request and, if such
request is withdrawn, such Demand Registration will not count as one of the
permitted Demand Registrations hereunder and Newco will pay all Registration
Expenses in connection with such registration.
(f) Other Registration Rights. Newco will not register for the
benefit of any Person other than TPI, PCA or their respective direct or indirect
transferees, or grant to any such other Person the right to request Newco to
register or to participate in Piggyback Registrations with respect to, any
equity securities of Newco, or any securities convertible or exchangeable into
or exercisable for such securities, without the prior written consent of both
(i) TPI, as long as it or any of its Affiliates owns any TPI Registrable
Securities and (ii) PCA, as long as it or any of its Affiliates owns any PCA
Registrable Securities.
3. Piggyback Registrations.
(a) General; Notice to Holders. In addition to the registration
rights in Section 2 above, whenever Newco proposes to register any of its
securities under the Securities Act (other than pursuant to a Demand
Registration hereunder) and the registration form to be used may be used for the
registration of Registrable Securities, Newco will give prompt written notice
(in any event within five (5) days after its receipt of notice of any exercise
of demand registration rights other than under this Agreement) to all holders of
Registrable Securities of its intention to effect such a registra-
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tion. Subject to Sections 3(c) and 3(d) below, Newco shall include in such
registration all Registrable Securities with respect to which Newco has received
written requests for inclusion therein within fifteen (15) days after the
receipt of Newco's notice. Registrations under this Section 3 are sometimes
referred to herein as "Piggyback Registrations."
(b) Number of Piggyback Registrations; Piggyback Registration
Expenses. The holders of the Registrable Securities shall be entitled to
participate in an unlimited number of Piggyback Registrations. The Registration
Expenses of the holders of Registrable Securities will be paid by Newco in all
Piggyback Registrations.
(c) Priority on Primary Piggyback Registrations. Subject to Section
3(f) below, if a Piggyback Registration is an underwritten primary registration
on behalf of Newco, and the managing underwriters advise Newco in writing that
in their opinion the number of securities requested to be included in such
registration exceeds the number which can be sold in an orderly manner in such
offering within a price range acceptable to Newco, Newco will include in such
registration:
(A) in the case of a registration with respect to which Newco
has provided notice under Section 3(a) above at any time during the
Special Priority Period, only the number of securities (including
Registrable Securities) which such underwriters advise in writing
can be sold in such manner and within such price range in the
following order of priority:
(i) first, the securities Newco proposes to sell;
(ii) second, the TPI Registrable Securities, if any,
requested to be included therein, pro-rata among the
holders of such TPI Registrable Securities on the basis
of the number of shares requested to be included by each
such holder;
(iii) third, the PCA Registrable Securities, if any, requested
to be included therein, pro-rata among the holders of
such PCA Registrable Securities on the basis of the
number of shares requested to be included by each such
holder;
(iv) fourth, the Transferee Registrable Securities, if any,
requested to be included therein, pro-rata among the
holders of such Transferee Registrable Securities on the
basis of the number of shares requested to be included
by each such holder; and
(v) fifth, any other securities requested to be included in
such registration; and
(B) in the case of a registration with respect to which Newco
has provided notice under Section 3(a) above at any time after the
Special Priority Period, only the
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number of securities (including Registrable Securities) which such
underwriters advise in writing can be sold in such manner and within
such price range in the following order of priority:
(i) first, the securities Newco proposes to sell;
(ii) second, the TPI Registrable Securities and the PCA
Registrable Securities, if any, requested to be included
therein, pro-rata among the holders of such Registrable
Securities on the basis of the number of shares
requested to be included by each such holder;
(iii) third, the Transferee Registrable Securities, if any,
requested to be included therein, pro-rata among the
holders of such Transferee Registrable Securities on the
basis of the number of shares requested to be included
by each such holder; and
(iv) fourth, any other securities requested to be included in
such registration.
(d) Priority on Secondary Piggyback Registrations. Subject to
Section 3(f) below, if a Piggyback Registration is an underwritten secondary
registration on behalf of holders of Newco's securities, and the managing
underwriters advise Newco in writing that in their opinion the number of
securities requested to be included in such registration exceeds the number
which can be sold in an orderly manner in such offering within a price range
acceptable to the holders initially requesting such registration, Newco will
include in such registration:
(A) in the case of a registration with respect to which Newco
has provided notice under Section 3(a) above at any time during the
Special Priority Period, only the number of securities (including
Registrable Securities) which can be sold in such manner and within
such price range in the following order of priority:
(i) first, the securities requested to be included therein
by the holders requesting such registration and the TPI
Registrable Securities, if any, requested to be included
therein, pro-rata among the holders of such securities
(including Registrable Securities) on the basis of the
number of shares requested to be included by each such
holder;
(ii) second, the PCA Registrable Securities, if any,
requested to be included therein, pro-rata among the
holders of such PCA Registrable Securities on the basis
of the number of shares requested to be included by each
such holder;
(iii) third, the Transferee Registrable Securities, if any,
requested to be included therein, pro-rata among the
holders of such Transferee Registrable Securities on the
basis of the number of shares requested
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to be included by each such holder; and
(iv) fourth, any other securities requested to be included in
such registration; and
(B) in the case of a registration with respect to which Newco
has provided notice under Section 3(a) above at any time after the
Special Priority Period, only the number of securities (including
Registrable Securities) which can be sold in such manner and within
such price range in the following order of priority:
(i) first, the securities requested to be included therein
by the holders requesting such registration, the TPI
Registrable Securities, if any, requested to be included
therein, and the PCA Registrable Securities, if any,
requested to be included therein, pro-rata among the
holders of such securities (including Registrable
Securities) on the basis of the number of shares
requested to be included by each such holder;
(ii) second, the Transferee Registrable Securities, if any,
requested to be included therein, pro-rata among the
holders of such Transferee Registrable Securities on the
basis of the number of shares requested to be included
by each such holder; and
(iii) third, any other securities requested to be included in
such registration.
(e) Selection of Underwriter and Holder's Counsel. If any Piggyback
Registration is an underwritten offering, the selection of investment bankers
and managers for the offering must be approved by the holders of a majority of
the Registrable Securities included in such Piggyback Registration. Such
approval will not be unreasonably withheld. The holders of the TPI Registrable
Securities and the PCA Registrable Securities shall have the right to select one
or two firms as counsel as provided in Section 2(c) above, the fees and expenses
of which shall be paid by Newco.
(f) Other Registrations. If Newco has been requested by the holders
of Registrable Securities to file a registration statement pursuant to Section 2
above or if it has filed a Registration Statement pursuant to this Section 3,
and if such previous request or registration has not been withdrawn or
abandoned, Newco will not file or cause to be effected any other registration of
any of its equity securities or securities convertible or exchangeable into or
exercisable for its equity securities under the Securities Act (except on Form
S-8 or any successor form), whether on its own behalf or at the request of any
holder or holders of such securities, until the expiration of the effectiveness
period required under Section 5(b) below.
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4. Holdback Agreements.
(a) Agreement by Holders. Each holder of Registrable Securities
agrees not to effect any public sale or distribution (including sales pursuant
to Rule 144 under the Securities Act) of equity securities of Newco, or any
securities convertible into or exchangeable or exercisable for such securities,
during the seven days prior to and the 180-day period beginning on the effective
date of any underwritten Demand Registration or any underwritten Piggyback
Registration in which Registrable Securities are included (except as part of
such underwritten registration), unless the underwriters managing the registered
public offering otherwise agree.
(b) Agreements by Newco. Newco agrees: (i) not to effect or
facilitate any public sale or distribution of its equity securities, or any
securities convertible into or exchangeable or exercisable for such securities,
during the thirty days prior to and during the 180-day period beginning on the
effective date of any underwritten Demand Registration or Piggyback Registration
(except as part of such underwritten Piggyback Registration or pursuant to
registrations on Form S-8 or any successor form), unless the underwriters
managing the registered public offering (and in the case of a Demand
Registration, the holders of a majority of the Registrable Securities included
therein) otherwise agree; and (ii) to cause Newco's directors, officers and
affiliates not to effect or facilitate any public sale or distribution
(including sales pursuant to Rule 144 under the Securities Act) of any equity
securities, or any securities convertible into or exchangeable or exercisable
for such securities during such period (except as part of such underwritten
registration, if otherwise permitted), unless the underwriters managing the
registered public offering, the holders of a majority of the TPI Registrable
Securities participating in such registration and the holders of a majority of
the PCA Registrable Securities participating in such registration otherwise
agree.
5. Registration and Qualification. If and whenever Newco is required
to effect the registration of any Registrable Securities, Newco shall as
promptly as possible:
(a) prepare, file and use its reasonable best efforts to cause to
become effective a registration statement under the Securities Act relating to
the Registrable Securities to be offered and effect the sale of such Registrable
Securities, in each case in accordance with the intended method of disposition
thereof (Newco shall cause such registration statement to be effective as
promptly as possible but in any event within 120 days of the request);
(b) prepare and file with the SEC such amendments and supplements to
such registration statement and the prospectus used in connection therewith as
may be necessary to keep such registration statement effective and to comply
with the provisions of the Securities Act with respect to the disposition of all
Registrable Securities included therein until the earlier of: (i) such time as
all of such Registrable Securities included therein have been disposed of in
accordance with the intended methods of disposition; and (ii) the expiration of
180 days after such registration statement becomes effective; provided, that
such 180-day period shall be extended for such number of days that equals the
number of days elapsing from (x) the date the written notice contemplated by
paragraph 5(g) below is given by Newco to (y) the date on which Newco delivers
to the holders of the Registrable Securities included in such registration
statement the supplement or amendment contemplated by paragraph 5(g) below;
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(c) provide copies of all registration statements, prospectus and
amendments and supplements to each firm selected by the holders of the
Registrable Securities in accordance with this Agreement at least ten days prior
to the filing thereof (if practicable, at least one day in the case of an
amendment or supplement prepared pursuant to Section 5(g) below), with such
counsel being provided with the opportunity (but not the obligation) to review
and comment on such documents;
(d) furnish to the holders of the Registrable Securities included in
such registration statement and to any underwriter of such Registrable
Securities such number of conformed copies of such registration statement and of
each such amendment and supplement thereto (in each case including all
exhibits), such number of copies of the prospectus included in such registration
statement (including each preliminary prospectus and any summary prospectus) in
conformity with the requirements of the Securities Act, such documents
incorporated by reference in such registration statement or prospectus, such
number of other offering documents, copies of any and all transmittal letters or
other correspondence to or received from, the SEC or any other governmental
agency or self-regulatory body or other body having jurisdiction (including any
domestic or foreign securities exchange) relating to such offering, and such
other documents, as the holders of such Registrable Securities or such
underwriter may reasonably request;
(e) use its reasonable best efforts to register or qualify all
Registrable Securities covered by such registration statement under the
securities or blue sky laws of such jurisdictions as the holders of the
Registrable Securities included in such registration statement or any
underwriter of such Registrable Securities shall request, and use its reasonable
best efforts to obtain all appropriate registrations, permits and consents in
connection therewith, and do any and all other acts and things which may be
necessary or advisable to enable such holders of such Registrable Securities or
any such underwriter to consummate the disposition in such jurisdictions of its
Registrable Securities covered by such registration statement;
(f) furnish to the holders of the Registrable Securities included in
such registration statement and to any underwriter of such Registrable
Securities: (i) an opinion of counsel for Newco addressed to the holders of such
Registrable Securities and dated the date of the closing under the underwriting
agreement (if any) (or if such offering is not underwritten, dated the effective
date of the registration statement); and (ii) a "cold comfort" letter addressed
to the holders of such Registrable Securities and signed by the independent
public accountants who have audited the financial statements of Newco included
in such registration statement, in each such case covering substantially the
same matters with respect to such registration statement (and the prospectus
included therein) as are customarily covered in opinions of issuer's counsel and
in accountants' letters delivered to underwriters in underwritten public
offerings of securities and such other matters as the holders of such Securities
may reasonably request and, in the case of such accountants' letter, with
respect to events subsequent to the date of such financial statements;
(g) as promptly as practicable, notify the holders of the
Registrable Securities included in such registration statement in writing: (i)
at any time when a prospectus relating to a registration statement hereunder is
required to be delivered under the Securities Act, of the happening of any event
as a result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state any material fact
-11-
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading; and (ii)
of any request by the SEC or any other regulatory body or other body having
jurisdiction for any amendment of or supplement to any registration statement or
other document relating to such offering, and in either such case, prepare and
furnish to the holders of such Registrable Securities a reasonable number of
copies of a supplement to or an amendment of such prospectus as may be necessary
so that, as thereafter delivered to the purchasers of such Registrable
Securities, such prospectus shall not include an untrue statement of a material
fact or omit to state a material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which they
are made, not misleading;
(h) cause all such Registrable Securities included in such
registration statement to be listed on each securities exchange on which similar
securities issued by Newco are then listed and, if not so listed, to be listed
on the New York Stock Exchange;
(i) furnish for delivery in connection with the closing of any
offering of Registrable Securities pursuant to a registration hereunder
unlegended certificates representing ownership of the Registrable Securities
being sold in such denominations as shall be requested by the holders of the
Registrable Securities or the underwriters;
(j) provide a transfer agent and registrar for all such Registrable
Securities not later than the effective date of such registration statement;
(k) enter into such customary agreements and take all such other
actions as the holders of a majority of the Registrable Securities being sold or
the underwriters, if any, reasonably request in order to expedite or facilitate
the disposition of such Registrable Securities (including effecting a stock
split or a combination of shares);
(l) otherwise use its best efforts to comply with all applicable
rules and regulations of the SEC, and make available to its security holders, as
soon as reasonably practicable, an earnings statement covering the period of at
least twelve months beginning with the first day of Newco's first full calendar
quarter after the effective date of the registration statement, which earnings
statement shall satisfy the provisions of Section 11(a) of the Securities Act
and Rule 158 thereunder;
(m) permit any holder of Registrable Securities which holder, in its
sole and exclusive judgment, might be deemed to be an underwriter or a
controlling person of Newco, to participate in the preparation of such
registration statement and to require the insertion therein of material,
furnished to Newco in writing, which in the reasonable judgment of such holder
and its counsel should be included; and
(n) in the event of the issuance of any stop order suspending the
effectiveness of a registration statement, or of any order suspending or
preventing the use of any related prospectus or suspending the qualification of
any Common Stock included in such registration statement for sale in any
jurisdiction, Newco will use its reasonable best efforts promptly to obtain the
withdrawal of
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such order.
If any such registration or comparable statement refers to any
holder of Registrable Securities by name or otherwise as the holder of any
securities of Newco and if in its sole and exclusive judgment, such holder is or
might be deemed to be a controlling person of Newco, such holder will have the
right to require: (i) the insertion therein of language, in form and substance
satisfactory to such holder and presented to Newco in writing, to the effect
that the holding by such holder of such securities is not to be construed as a
recommendation by such holder of the investment quality of Newco's securities
covered thereby and that such holding does not imply that such holder will
assist in meeting any future financial requirements of Newco; or (ii) in the
event that such reference to such holder by name or otherwise is not required by
the Securities Act or any similar federal statute then in force, the deletion of
the reference to such holder; provided that with respect to this clause (ii)
such holder will furnish to Newco an opinion of counsel to such effect.
6. Recapitalization; Underwriting; Due Diligence.
(a) For any Piggyback Registration or Demand Registration prior to
the time Newco becomes subject to the Exchange Act with respect to Registrable
Securities, Newco shall effect a stock split, stock dividend or stock
combination which in the opinion of the underwriters is desirable for the sale
and marketing of the Registrable Securities to the public.
(b) If requested by the underwriters for any underwritten offering
of Registrable Securities pursuant to a registration requested under this
Agreement, Newco shall enter into an underwriting agreement with such
underwriters for such offering, which agreement will contain such
representations and warranties by Newco and such other terms and provisions as
are customarily contained in underwriting agreements of Newco to the extent
relevant and as are customarily contained in underwriting agreements generally
with respect to secondary distributions to the extent relevant, including,
without limitation, indemnification and contribution provisions substantially to
the effect and to the extent provided in Section 7(a), and agreements as to the
provision of opinions of counsel and accountants' letters to the effect and to
the extent provided in Section 5(f). Subject to Section 9 below, the holders of
the Registrable Securities included in such registration shall be parties to any
such underwriting agreement and the representations and warranties by, and the
other agreements on the part of, Newco to and for the benefit of such
underwriters, shall also be made to and for the benefit of the holders of such
Registrable Securities.
(c) In connection with the preparation and filing of each
registration statement registering Registrable Securities under the Securities
Act pursuant to this Agreement, Newco shall give the holders of the Registrable
Securities included in such registration and the underwriters, if any, and their
respective counsel, accountants and agents, the opportunity (but such persons
shall not have the obligation) to review the books and records of Newco and to
discuss the business of Newco with its officers and the independent public
accountants who have certified the financial statements of Newco as shall be
necessary, in the opinion of the holders of such Registrable Securities and such
underwriters or their respective counsel, to conduct a reasonable investigation
within the meaning of the Securities Act.
-13-
7. Indemnification.
(a) Newco Indemnification. Newco agrees to indemnify, to the extent
permitted by law, each holder of Registrable Securities, its officers and
directors and each Person who controls such holder (within the meaning of the
Securities Act) and the officers, directors, affiliates, employees and agents of
each of the foregoing (whether or not any litigation is commenced or threatened
and whether or not such indemnified Persons are parties to any litigation
commenced or threatened), against all losses, claims, damages, liabilities and
expenses including, without limitation, attorneys' fees, expert fees and amounts
paid in settlement, resulting from or arising out of any untrue or alleged
untrue statement of material fact contained in any registration statement,
prospectus or preliminary prospectus or any amendment thereof or supplement
thereto or any omission or alleged omission of a material fact required to be
stated therein or necessary to make the statements therein not misleading,
except insofar as the same are caused by or contained in any information
furnished in writing to Newco by such holder expressly for use therein or by
such holder's failure to deliver a copy of the registration statement or
prospectus or any amendments or supplements thereto after Newco has furnished
such holder with a sufficient number of copies of the same. In connection with
an underwritten offering, Newco will indemnify such underwriters, their officers
and directors and each Person who controls such underwriters (within the meaning
of the Securities Act) to the same extent as provided above with respect to the
indemnification of the holders of Registrable Securities. Such indemnity shall
remain in full force and effect regardless of any investigation made by or on
behalf of the holders of the Registrable Securities or any underwriter and shall
survive the transfer of such securities. The foregoing indemnity agreement is in
addition to any liability that Newco may otherwise have to the holders of the
Registrable Securities or any underwriter of the Registrable Securities or any
controlling Person of the foregoing and the officers, directors, affiliates,
employees and agents of each of the foregoing.
(b) Holder Indemnification. In connection with any registration
statement in which a holder of Registrable Securities is participating, each
such holder agrees to indemnify, to the extent permitted by law, Newco, its
directors and officers and each Person who controls Newco (within the meaning of
the Securities Act) and the officers, directors, affiliates, employees and
agents of each of the foregoing (whether or not any litigation is commenced or
threatened and whether or not such indemnified Persons are parties to any
litigation commenced or threatened), against any losses, claims, damages,
liabilities and expenses including, without limitation, attorneys' fees, expert
fees and amounts paid in settlement, resulting from or arising out of any untrue
or alleged untrue statement of material fact contained in the registration
statement, prospectus or preliminary prospectus or any amendment thereof or
supplement thereto or any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein not
misleading, but only to the extent that such untrue statement or omission is
contained in any information furnished in writing to Newco by such holder
expressly for use in such registration statement; provided, however, that the
obligation to indemnify will be individual to each such holder and will be
limited to the net amount of proceeds received by such holder from the sale of
Registrable Securities pursuant to such registration statement.
(c) Resolution of Claims. Any Person entitled to indemnification
hereunder will: (i) give prompt written notice to the indemnifying party of any
claim with respect to which it seeks
-14-
indemnification hereunder; and (ii) unless in such indemnified party's
reasonable judgment a conflict of interest between such indemnified and
indemnifying parties may exist with respect to such claim, permit such
indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party. If such defense is assumed, the
indemnifying party will not be subject to any liability for any settlement made
by the indemnified party without its consent (but such consent will not be
unreasonably withheld). An indemnifying party who is not entitled to, or elects
not to, assume the defense of a claim will not be obligated to pay the fees and
expenses of more than one counsel for all parties indemnified by such
indemnifying party with respect to such claim, unless in the reasonable judgment
of any indemnified party a conflict of interest may exist between such
indemnified party and any other of such indemnified parties with respect to such
claim.
(d) Contribution. If the indemnification provided for in this
Section 7 shall for any reason be unavailable (other than in accordance with its
terms) to an indemnified party in respect of any loss, claim, damage, liability
or expense referred to therein, then each indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or payable by
such indemnified party as a result of such loss, claim, damage, liability or
expense in such proportion as shall be appropriate to reflect the relative fault
of the indemnifying party on the one hand and the indemnified party on the other
with respect to the statements or omissions which resulted in such loss, claim,
damage, liability or expense as well as any other relevant equitable
considerations. The relative fault shall be determined by reference to whether
the untrue or alleged untrue statement of a material fact or omission or alleged
omission to state a material fact relates to information supplied by the
indemnifying party on the one hand or the indemnified party on the other. The
amount paid or payable by an indemnified party as a result of the loss, cost,
claim, damage, liability or expense, or action in respect thereof, referred to
above in this Section 7(d) shall be deemed to include, for purposes of this
Section 7(d), any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such action
or claim. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. In any
event, a holder's obligation to provide contribution pursuant to this Section
7(d) shall be limited to the net amount of proceeds received by such holder from
the sale of Registrable Securities pursuant to such registration statement.
(e) State Securities Laws. Indemnification and contribution similar
to that specified in the preceding paragraphs of this Section 7 (with
appropriate modifications) shall be given by Newco, the holders of the
Registrable Securities and underwriters with respect to any required
registration or other qualification of securities under any state law or
regulation or governmental authority.
(f) Other Rights. The obligations of the parties under this Section
7 shall be in addition to any liability which any party may otherwise have to
any other party.
-15-
8. Rule 144. Newco shall use its reasonable best efforts to ensure
that the conditions to the availability of Rule 144 set forth in paragraph (c)
thereof shall be satisfied. Upon the request of the holders of a majority of the
TPI Registrable Securities or the holders of a majority of the PCA Registrable
Securities, Newco will deliver to such holders a written statement as to whether
it has complied with such requirements.
9. Participation in Underwritten Registrations. No holder of
Registrable Securities may participate in any registration hereunder which is
underwritten unless such holder: (a) agrees to sell such holder's securities on
the basis provided in any underwriting arrangements contemplated by such
offering; and (b) completes and executes all questionnaires, powers of attorney,
indemnities, underwriting agreements and other documents required under the
terms of such underwriting arrangements; provided, however, that no holder of
Registrable Securities included in any underwritten registration will be
required to make: (i) any representations or warranties to Newco, the
underwriters or other Persons other than representations and warranties
regarding such holder and such holder's intended method of distribution; or (ii)
any indemnities to Newco, the underwriter or other Persons on terms which are
not substantially identical to the provisions in Section 7(b) above.
10. Miscellaneous.
(a) No Inconsistent Agreements. Newco represents and warrants to the
holders of the Registrable Securities that it has not entered into, and agrees
with the holders of the Registrable Securities that it will not hereafter enter
into, any agreement with respect to its securities which is inconsistent or
conflicts with, or violates the rights granted to the holders of Registrable
Securities in, this Agreement.
(b) Adjustments Affecting Registrable Securities. In addition to
Newco's obligations under Section 6(a) above, Newco will not take any action, or
permit any change to occur, with respect to its securities which would adversely
affect the ability of the holders of Registrable Securities to include such
Registrable Securities in a registration undertaken pursuant to this Agree ment
or which would adversely affect the marketability of such Registrable Securities
in any such registration (including effecting a stock split or a combination of
shares).
(c) Remedies. Each holder of Registrable Securities will have all
rights and remedies set forth in this Agreement, Newco's Certificate of
Incorporation and all rights and remedies which such holders have been granted
at any time under any other agreement and all of the rights which such holders
have under any law. Any Person having any rights under any provision of this
Agreement will be entitled to enforce such rights specifically, without posting
a bond or other security, to recover damages by reason of any breach of any
provision of this Agreement and to exercise all other rights granted by law.
-16-
(d) Amendments; Waiver. Except as otherwise expressly provided
herein, the provisions of this Agreement may be amended and Newco may take any
action herein prohibited, or omit to perform any act herein required to be
performed by it, only if Newco has obtained the written consent of both: (i)
TPI, as long as it or any of its Affiliates owns any TPI Registrable Securities;
and (ii) PCA, as long as it or any of its Affiliates owns any PCA Registrable
Securities. No other course of dealing between Newco and the holder of any
Registrable Securities or any delay in exercising any rights hereunder or under
the Certificate of Incorporation will operate as a waiver of any rights of any
such holders. For purposes of this Agreement, shares held by Newco or any of its
Subsidiaries will not be deemed to be Registrable Securities. If Newco pays any
consideration to any holder of Registrable Securities for such holder's consent
to any amendment, modification or waiver hereunder, Newco will also pay each
other holder granting its consent hereunder equivalent consideration computed on
a pro rata basis.
In the event that the Securities Act, Exchange Act and/or
regulations thereunder, respectively, are amended in a material respect and one
or more of such amendments reduce or diminish the benefits hereunder to the
holders of the Registrable Securities, including, without limitation, amendments
which may be adopted in connection with the Aircraft Carrier Release (any such
reducing or diminishing amendments being referred to herein as "Securities Law
Amendments"), Newco shall, upon the written request of both (i) TPI, as long as
it or any of its Affiliates owns any TPI Registrable Securities, and (ii) PCA,
as long as it or any of its Affiliates owns any PCA Registrable Securities,
amend this Agreement to provide the holders of the Registrable Securities with
benefits which, after giving effect to such Securities Law Amendments, are
equivalent to the benefits hereunder absent such Securities Law Amendments.
(e) Headings. The headings in this Agreement are inserted for
convenience only and shall not be deemed to define or limit the scope of any
section or subsection.
(f) Notices. All requests, notices, demands or other communications
shall be in writing and will be deemed to have been given when delivered to the
recipient, when received by facsimile, one (1) business day after the date when
sent to the recipient by overnight courier service or five (5) business days
after the date when mailed to the recipient by certified or registered mail,
return receipt requested and postage prepaid. Such requests, notices, demands
and other communications will be sent to TPI, PCA and to Newco at the addresses
indicated below:
If to TPI:
Tenneco Packaging Inc.
0000 Xxxx Xxxxx Xxxxx
Xxxx Xxxxxx, Xxxxxxxx 00000
Attn: General Counsel
Telecopy: 847/482-4589
-17-
With a copy to:
Jenner & Block
Xxx XXX Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxxxx, Esq.
Telecopy: 312/840-7271
If to PCA:
PCA Holdings, LLC
c/o Madison Dearborn Partners, Inc.
Three First Xxxxxxxx Xxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxxx
Xxxxxx X. Xxxxxxx
Telecopy: (000) 000-0000
With a copy to:
Xxxxxxxx & Xxxxx
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attn: Xxxxxxx X. Xxxxx, P.C.
Telecopy: 312/861-2200
If to Newco:
Packaging Corporation of America
0000 Xxxx Xxxxx Xxxxx
Xxxx Xxxxxx, Xxxxxxxx 00000
Attn: Chief Executive Officer
Telecopy: 847/482-2446
or to such other address or to the attention of such other Person as the
recipient party has specified by prior written notice in accordance with the
procedures provided above. Notices to any other holders of Registrable
Securities shall be sent to the address specified by prior written notice to
Newco, TPI and PCA in accordance with the procedures provided above.
(g) No Third-Party Beneficiaries. Subject to Section 10(k), this
Agreement will not confer any rights or remedies upon any Person other than
Newco, TPI and PCA and their respective successors.
-18-
(h) Entire Agreement. This Agreement (including the documents
referred to herein) constitutes the entire agreement among the parties and
supersedes any prior understandings, agreements, or representations by or among
the parties, written or oral, that may have related in any way to the subject
matter hereof.
(i) Governing Law. The corporate law of the State of Delaware will
govern all issues concerning the relative rights of Newco and its stockholders.
All other questions concerning the construction, validity and interpretation of
this Agreement will be governed by the internal law, and not the law of
conflicts, of the State of Illinois.
(j) Severability. In the event any provision in this Agreement is
held to be invalid as applied to any fact or circumstance, it shall be
ineffective only to the extent of such invalidity, and such invalidity shall not
affect the other provisions of this Agreement or the same provision as applied
to any other fact or circumstance.
(k) Successors and Assigns. This Agreement shall be binding upon the
parties hereto and their respective successors and any Person who becomes a
holder of Registrable Securities. This Agreement shall inure to the benefit of
and be enforceable by the parties hereto and their respective successors and any
Person who becomes a holder of Registrable Securities (to the extent provided
herein with respect to Registrable Securities of the type held by such holder).
(l) Counterparts. This Agreement may be executed in counterparts.
(m) Termination. The rights of all holders of TPI Registrable
Securities under this Agreement shall terminate as of the date when TPI,
together with its Affiliates, holds Registrable Securities with a fair market
value of less than $500,000.
-19-
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
NEWCO:
Packaging Corporation of America
By /s/ Xxxxxxx X. Xxxx
______________________________________
Its Secretary
_____________________________________
TPI:
Tenneco Packaging Inc.
By /s/ Xxxxx X. Xxxxxxxx, Xx.
______________________________________
Its Vice President
_____________________________________
PCA:
PCA Holdings, LLC
By /s/ Xxxxxx X. Xxxxxxx
______________________________________
Its Managing Director
_____________________________________
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