EXECUTION COPY
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
SF HOLDINGS GROUP, INC.
AMERICAN INDUSTRIAL PARTNERS MANAGEMENT COMPANY, INC.
$30,000,000
3,000 UNITS CONSISTING OF
13 3/4% EXCHANGEABLE PREFERRED STOCK DUE 2009 AND
111,000 SHARES OF CLASS C COMMON STOCK
REGISTRATION RIGHTS AGREEMENT
March 20, 1998
BEAR, XXXXXXX & CO. INC.
-------------------------------------------------------------------------------
-------------------------------------------------------------------------------
This Registration Rights Agreement (this "Agreement") is made and
entered into as of March 20, 1998, by and between SF Holdings Group, Inc., a
Delaware corporation (the "Company"), American Industrial Partners Management
Company, Inc., the general partner of American Industrial Partners, L.P., which
is the general partner one of the Selling Stockholders referred to below
("AIPM"), and Bear, Xxxxxxx & Co., Inc. (the "Initial Purchaser"), who has
agreed to purchase the Company's Share Units (the "Units"), consisting of 3,000
shares of 13 3/4% Exchangeable Preferred Stock due 2009 (the "Preferred Stock")
and 111,000 shares of Class C Common Stock, par value $.001 per share, of the
Company pursuant to the Purchase Agreement (as defined below).
Pursuant to the terms of the Company's Restated Certificate of
Incorporation (the "Restated Certificate of Incorporation") filed with the
Secretary of State of the State of Delaware, the Company may, at its option,
exchange the Preferred Stock for the Company's 13 3/4% Subordinated Notes due
2009 (the "Exchange Notes") issued pursuant to an indenture (the "Exchange
Indenture").
This Agreement is made pursuant to the Purchase Agreement, dated
March 11, 1998 (the "Purchase Agreement"), by and among the Company, the
stockholders of the Company set forth on Schedule I hereto (the "Selling
Stockholders") and the Initial Purchaser. In order to induce the Initial
Purchaser to purchase the Units, the Company has agreed to provide the
registration rights set forth in this Agreement. The execution and delivery of
this Agreement is a condition to the obligations of the Initial Purchaser set
forth in Section 2 of the Purchase Agreement.
The parties hereby agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement, the following capitalized terms shall
have the following meanings:
Act: The Securities Act of 1933, as amended.
Affiliate: As defined in Rule 144 under the Act.
Broker-Dealer: Any broker or dealer registered under the Exchange
Act.
Business Day: Any day except a Saturday, Sunday or other day in the
City of New York, or in the city of the principal office of the Transfer Agent,
on which banks are authorized to close.
Certificated Securities: As defined in the Stockholders Agreement.
Closing Date: The date of this Agreement.
Commission: The Securities and Exchange Commission.
Company: As defined in the preamble hereto.
Consummate: An Exchange Offer shall be deemed "Consummated" for
purposes of this Agreement upon the occurrence of (i) the filing and
effectiveness under the Act of the Exchange Offer Registration Statement
relating to the New Preferred Stock, or if the Preferred Stock has been
exchanged for Exchange Notes, the New Exchange Notes to be issued in the
Exchange Offer, (ii) the maintenance of such Exchange Offer Registration
Statement continuously effective and the keeping of the Exchange Offer open for
a period not less than the minimum period required pursuant to Section 3(b)
hereof, and
(iii) the delivery by the Company to the Transfer Agent of shares of New
Preferred Stock with the same aggregate Liquidation Amount as the aggregate
Liquidation Amount of the shares of Preferred Stock that were tendered by
Holders thereof pursuant to the Exchange Offer, or, if the Preferred Stock has
been exchanged for Exchange Notes, the delivery by the Company to the Exchange
Note Trustee in the same aggregate principal amount as the aggregate principal
amount of Exchange Notes that were tendered by Holders thereof pursuant to the
Exchange Offer.
Damages Payment Date: Each Dividend Payment Date or Interest Payment
Date, as the case may be.
Dividend Payment Date: As defined in the Restated Certificate of
Incorporation with respect to the Preferred Stock.
Effectiveness Deadline: As defined in Section 3(a) hereof.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Exchange Indenture: As defined in the preamble hereto.
Exchange Note Trustee: The trustee under the Exchange Indenture.
Exchange Offer: The registration by the Company under the Act of the
New Preferred Stock or, if the Preferred Stock has been exchanged for Exchange
Notes, the New Exchange Notes pursuant to the Exchange Offer Registration
Statement pursuant to which the Company shall offer the Holders of all
outstanding Transfer Restricted Securities the opportunity to exchange all such
outstanding Transfer Restricted Securities for New Preferred Stock with the
same aggregate Liquidation Amount as the Preferred Stock tendered in such
exchange by such Holders, or New Exchange Notes in an aggregate principal
amount equal to the aggregate principal amount of the Exchange Notes tendered
in such exchange offer by such Holders, as the case may be.
Exchange Offer Registration Statement: The Registration Statement
relating to the Exchange Offer, including the related Prospectus.
Exempt Resales: The transactions in which the Initial Purchaser
propose to sell the Units to certain "qualified institutional buyers," as such
term is defined in Rule 144A under the Act, to certain institutional
"accredited investors," as such term is defined in Rule 501(a)(1), (2), (3) and
(7) of Regulation D under the Act, and to certain persons permitted to purchase
the Units in offshore transactions in reliance upon Regulation S under the Act.
Filing Deadline: As defined in Section 3(a) hereof.
Global Securities: As defined in the Stockholders Agreement.
Holders: As defined in Section 2(b) hereof.
Indemnified Holder: As defined in Section 8(a) hereof.
indemnified party: As defined in Section 8(c) hereof.
2
indemnifying party: As defined in Section 8(c) hereof.
Initial Purchaser: As defined in the preamble hereto.
Interest Payment Date: As defined in the Exchange Indenture and the
Exchange Notes.
Liquidated Damages: As defined in Section 5 hereof.
Liquidation Amount: As defined in the Restated Certificate of
Incorporation with respect to the Preferred Stock.
NASD: National Association of Securities Dealers, Inc.
New Exchange Notes: The Company's 13 3/4% Subordinated Notes due
2009 to be issued pursuant to the Exchange Indenture (i) in the Exchange Offer
or (ii) upon the request of any Holder of Exchange Notes covered by a Shelf
Registration Statement in exchange for such Exchange Notes.
New Preferred Stock: The Company's 13 3/4% Exchangeable Preferred
Stock due 2009 to be issued pursuant to the Restated Certificate of Designation
(i) in the Exchange Offer or (ii) upon the request of any Holder of Preferred
Stock covered by a Shelf Registration Statement in exchange for such Preferred
Stock.
Offering Memorandum: As defined in the Purchase Agreement.
Person: An individual, partnership, corporation, trust or
unincorporated organization, or a government or agency or political subdivision
thereof.
Preferred Stock: As defined in the preamble hereto.
Prospectus: The prospectus included in a Registration Statement at
the time such Registration Statement is declared effective, as amended or
supplemented by any prospectus supplement and by all other amendments thereto,
including post-effective amendments, and all material incorporated by reference
into such Prospectus.
Purchase Agreement: As defined in the preamble hereto.
Recommencement Date: As defined in the last paragraph of Section 6
hereof.
Registration Default: As defined in Section 5 hereof.
Registration Statement: Any registration statement of the Company
relating to (a) an offering of New Preferred Stock or New Exchange Notes, as
applicable, pursuant to an Exchange Offer or (b) the registration for resale of
Transfer Restricted Securities pursuant to the Shelf Registration Statement in
each case, (i) that is filed pursuant to the provisions of this Agreement and
(ii) including the Prospectus included therein, all amendments and supplements
thereto (including post-effective amendments) and all exhibits and material
incorporated by reference therein.
Regulation S: Regulation S promulgated under the Act.
3
Restated Certificate of Incorporation: As defined in the preamble
hereto.
Rule 144: Rule 144 promulgated under the Act.
Senior Secured Discount Notes: The Company's 12 3/4% Senior Secured
Discount Notes due 2008.
Shelf Effectiveness Deadline: As defined in Section 4(a) hereof.
Shelf Filing Deadline: As defined in Section 4(a) hereof.
Shelf Registration Statement: As defined in Section 4 hereof.
Stockholders Agreement: The Stockholders Agreement, dated as of
March 20, 1998, between the Company and the Initial Purchaser.
Suspension Notice: As defined in the last paragraph of Section 6
hereof.
TIA: The Trust Indenture Act of 1939 (15 U.S.C. Section
77aaa-77bbbb) as in effect on the date of the Exchange Indenture.
Transfer Agent: The transfer agent with respect to the Preferred
Stock.
Transfer Restricted Securities: Each share of Preferred Stock or
each Exchange Note until the earliest to occur of (a) the date on which such
Preferred Stock or Exchange Note, as applicable, is exchanged in the Exchange
Offer and entitled to be resold to the public by the Holder thereof without
complying with the prospectus delivery requirements of the Act, (b) the date on
which such Preferred Stock or Exchange Note, as applicable, has been
effectively registered under the Act and disposed of in accordance with a Shelf
Registration Statement, (c) the date on which such Preferred Stock or Exchange
Note, as applicable, is disposed of by a Broker-Dealer pursuant to the "Plan of
Distribution" contemplated by the Exchange Offer Registration Statement
(including delivery of the Prospectus contained therein) or (d) the date on
which such Preferred Stock or Exchange Note, as applicable, is distributed to
the public pursuant to Rule 144 under the Act.
Underwritten Registration or Underwritten Offering: A registration
in which securities of the Company are sold to an underwriter for reoffering to
the public.
Units: As defined in the preamble hereto.
SECTION 2. SECURITIES SUBJECT TO THIS AGREEMENT
(a) Transfer Restricted Securities. The securities entitled to the
benefits of this Agreement are the Transfer Restricted Securities.
(b) Holders of Transfer Restricted Securities. A Person is deemed to
be a holder of Transfer Restricted Securities (each, a "Holder") whenever such
Person owns Transfer Restricted Securities. The
4
term Holder shall not include any of the Selling Stockholders unless a Selling
Stockholder acquires Transfer Restricted Securities subsequent to the closing
under the Purchase Agreement.
SECTION 3. REGISTERED EXCHANGE OFFER
(a) Unless the Exchange Offer shall not be permissible under
applicable law or Commission policy (after the procedures set forth in Section
6(a) below have been complied with), the Company shall (i) cause to be filed
with the Commission as soon as practicable after the Closing Date, but in no
event later than 45 days after the Closing Date (such 45th day being the
"Filing Deadline"), an Exchange Offer Registration Statement under the Act
relating to the New Preferred Stock or the New Exchange Notes, as applicable,
and the Exchange Offer, (ii) use its best efforts to cause such Exchange Offer
Registration Statement to become effective at the earliest possible time, but
in no event later than 120 days after the Closing Date (such 120th day being
the "Effectiveness Deadline"), (iii) in connection with the foregoing, (A) file
all pre-effective amendments to such Exchange Offer Registration Statement as
may be necessary in order to cause such Registration Statement to become
effective, (B) file if applicable, a post-effective amendment to such Exchange
Offer Registration Statement pursuant to Rule 430A under the Act and (C) cause
all necessary filings, if any, in connection with the registration and
qualification of the New Preferred Stock or the New Exchange Notes, as
applicable, to be made under the Blue Sky laws of such jurisdictions as are
necessary to permit Consummation of the Exchange Offer, except as would subject
it to service of process in suits or taxation, in each case, other than as to
matters and transactions relating to the Offering Memorandum, the Exchange
Offer, any Registration Statement or Exempt Resales, in any jurisdiction where
it is not now so subject and (iv) upon the effectiveness of such Exchange Offer
Registration Statement, commence and Consummate the Exchange Offer. The
Exchange Offer shall be on the appropriate form permitting registration of the
New Preferred Stock or the New Exchange Notes, as applicable, to be offered in
exchange for the Preferred Stock or the Exchange Notes, as applicable, that are
Transfer Restricted Securities and to permit resales of New Preferred Stock or
the New Exchange Notes, as applicable, by Broker-Dealers that tendered into the
Exchange Offer for Preferred Stock or Exchange Notes, as applicable, that such
Broker-Dealer acquired for its own account as a result of market-making
activities or other trading activities (other than Preferred Stock or Exchange
Notes, as applicable, acquired directly from the Company or any of its
Affiliates) as contemplated by Section 3(c) below.
(b) The Company shall cause the Exchange Offer Registration
Statement to be effective continuously and shall keep the Exchange Offer open
for a period of not less than the minimum period required under applicable
federal and state securities laws to Consummate the Exchange Offer; provided,
however, that in no event shall such period be less than 20 Business Days. The
Company shall cause the Exchange Offer to comply with all applicable federal
and state securities laws. Without the consent of the Initial Purchaser, no
securities other than the Preferred Stock or the Exchange Notes, as applicable,
shall be included in the Exchange Offer Registration Statement. The Company
shall use its best efforts to cause the Exchange Offer to be Consummated on the
earliest practicable date after the Exchange Offer Registration Statement has
become effective, but in no event later than 30 Business Days thereafter.
(c) The Company shall include a "Plan of Distribution" section in
the Prospectus contained in the Exchange Offer Registration Statement and
indicate therein that any Broker-Dealer who holds Preferred Stock or Exchange
Notes, as applicable, that are Transfer Restricted Securities and that were
acquired for its own account as a result of market-making activities or other
trading activities (other than Transfer Restricted Securities acquired directly
from the Company or an Affiliate of the Company), may exchange such Transfer
Restricted Securities pursuant to the Exchange Offer; however, such
Broker-Dealer
5
may be deemed to be an "underwriter" within the meaning of the Act and must,
therefore, deliver a prospectus meeting the requirements of the Act in
connection with the initial sale of any New Preferred Stock or New Exchange
Notes, as applicable, received by such Broker-Dealer in the Exchange Offer,
which prospectus delivery requirement may be satisfied by the delivery by such
Broker-Dealer of the Prospectus contained in the Exchange Offer Registration
Statement. Such "Plan of Distribution" section shall also contain all other
information with respect to such sales by such Broker-Dealers that the
Commission may require in order to permit such sales pursuant thereto, but such
"Plan of Distribution" shall not name any such Broker-Dealer or disclose the
amount of Transfer Restricted Securities held by any such Broker-Dealer except
to the extent required by the Commission as a result of a change in policy,
rules or regulations after the date of this Agreement.
The Company shall use its best efforts to keep the Exchange Offer
Registration Statement continuously effective, supplemented and amended as
required by the provisions of Section 6(c) below to the extent necessary to
ensure that it is available for sales of New Preferred Stock or New Exchange
Notes, as applicable, acquired by Broker-Dealers for their own accounts as a
result of market-making activities or other trading activities, and to ensure
that it conforms with the requirements of this Agreement, the Act and the
policies, rules and regulations of the Commission as announced from time to
time, for a period of 270 days from the date on which the Exchange Offer
Registration Statement is declared effective.
The Company shall provide sufficient copies of the latest version of
such Prospectus to Broker- Dealers promptly upon request at any time during
such 270 day period in order to facilitate such sales.
SECTION 4. SHELF REGISTRATION
(a) Shelf Registration. If (i) the Company is not required to file
an Exchange Offer Registration Statement or to Consummate the Exchange Offer
because the Exchange Offer is not permitted by applicable law or Commission
policy (after the procedures set forth in Section 6(a) below have been complied
with) or (ii) if any Holder of Transfer Restricted Securities shall notify the
Company within 20 Business Days of the Consummation of the Exchange Offer (A)
that such Holder is prohibited by applicable law or Commission policy from
participating in the Exchange Offer, or (B) that such Holder may not resell the
New Preferred Stock or the New Exchange Notes, as applicable, acquired by it in
the Exchange Offer to the public without delivering a prospectus and that the
Prospectus contained in the Exchange Offer Registration Statement is not
appropriate or available for such resales by such Holder, or (C) that such
Holder is a Broker-Dealer and holds Preferred Stock or Exchange Notes, as
applicable, acquired directly from the Company or one of its Affiliates, then
the Company shall:
(x) cause to be filed a shelf registration statement pursuant
to Rule 415 under the Act, which may be an amendment to the Exchange
Offer Registration Statement (in either event, the "Shelf Registration
Statement") on or prior to the earliest to occur of (1) the 60th day
after the date on which the Company determines that it is not required to
file the Exchange Offer Registration Statement, (2) the 60th day after
the date on which the Company receives notice from a Holder of Transfer
Restricted Securities as contemplated by clause (ii) above, and (3) the
120th day after the Closing Date (such earliest date being the "Shelf
Filing Deadline"), which Shelf Registration Statement shall provide for
resales of all Transfer Restricted Securities the Holders of which shall
have provided the information required pursuant to Section 4(b) hereof;
and
6
(y) use their best efforts to cause such Shelf Registration
Statement to be declared effective by the Commission on or before the
90th day after the Shelf Filing Deadline (such 90th day the "Shelf
Effectiveness Deadline").
The Company shall use its best efforts to keep such Shelf Registration
Statement continuously effective, supplemented and amended as required by the
provisions of Sections 6(b) and (c) hereof to the extent necessary to ensure
that it is available for resales of Transfer Restricted Securities by the
Holders thereof entitled to the benefit of this Section 4(a), and to ensure
that it conforms with the requirements of this Agreement, the Act and the
policies, rules and regulations of the Commission as announced from time to
time, for a period of two years following the Closing Date (as extended
pursuant to Section 6(c)(i) following the date on which such Shelf Registration
Statement first becomes effective under the Act, or such shorter period as will
terminate when all Transfer Restricted Securities covered by such Registration
Statement have been sold pursuant thereto).
(b) Provision by Holders of Certain Information in Connection with
the Shelf Registration Statement. No Holder of Transfer Restricted Securities
may include any of its Transfer Restricted Securities in any Shelf Registration
Statement pursuant to this Agreement unless and until such Holder furnishes to
the Company in writing, within 20 Business Days after receipt of a request
therefor, such information as the Company may reasonably request for use in
connection with any Shelf Registration Statement or Prospectus or preliminary
Prospectus included therein. No Holder of Transfer Restricted Securities shall
be entitled to Liquidated Damages pursuant to Section 5 hereof unless and until
such Holder shall have used its best efforts to provide all such reasonably
requested information. Each Holder as to which any Shelf Registration Statement
is being effected agrees to furnish promptly to the Company all information
required to be disclosed in order to make the information previously furnished
to the Company by such Holder not materially misleading.
SECTION 5. LIQUIDATED DAMAGES
(a) If (i) any of the Registration Statements required by this
Agreement are not filed with the Commission on or prior to the Filing Deadline
or Shelf Filing Deadline, as the case may be, (ii) any of such Registration
Statements has not been declared effective by the Commission on or prior to the
Effective Deadline or Shelf Effective Deadline, as the case may be, (iii) the
Exchange Offer has not been Consummated within 30 Business Days after the
Effective Deadline with respect to the Exchange Offer Registration Statement or
(iv) any Registration Statement required by this Agreement is filed and
declared effective but shall thereafter cease to be effective or fail to be
usable for its intended purpose without being succeeded immediately by a
post-effective amendment to such Registration Statement that cures such failure
and that is itself immediately declared effective (each such event referred to
in clauses (i) through (iv), a "Registration Default"), the Company agrees to
pay liquidated damages ("Liquidated Damages") to each Holder of Transfer
Restricted Securities with respect to the first 90-day period, or any portion
thereof, immediately following the occurrence of such Registration Default, in
an amount equal to 50 basis points per annum of the Liquidation Amount of the
Preferred Stock or the aggregate outstanding principal amount of Exchange
Notes, as applicable, held by such Holder. The amount of the Liquidated Damages
will increase by an additional 50 basis points per annum of the Liquidation
Amount of the Preferred Stock or the aggregate outstanding principal amount of
Exchange Notes, as applicable, held by such Holder for each subsequent 90-day
period, or any portion thereof, until all Registration Defaults have been
cured, up to a maximum amount of two hundred basis points per annum of the
Liquidation Amount of the Preferred Stock or the aggregate outstanding
principal amount of Exchange Notes, as applicable. All accrued
7
Liquidated Damages shall be paid to the holders of beneficial interests in
Global Securities by the Company by wire transfer of immediately available
funds or by federal funds check and to holders of Certificated Securities by
wire transfer to the accounts specified by them or by mailing checks to their
registered addresses if no such accounts have been specified, in each case, on
each Damages Payment Date. As of the date of the cure of all Registration
Defaults relating to any particular Transfer Restricted Securities, the accrual
of Liquidated Damages with respect to such Transfer Restricted Securities will
cease.
(b) Notwithstanding anything to the contrary in Section 5(a) hereof,
in the event a change in Commission policy with respect to the rules and
regulations of the Commission governing exchange offers occurs and solely as a
result thereof a Registration Default occurs, AIPM shall pay all Liquidated
Damages resulting therefrom in such manner as set forth in Section 5(a) and the
Company shall be relieved from its obligations to pay any such Liquidated
Damages.
(c) All obligations of the Company and AIPM set forth in this
Section 5 that are outstanding with respect to any Transfer Restricted Security
at the time such security ceases to be a Transfer Restricted Security shall
survive until such time as all such obligations with respect to such Transfer
Restricted Security shall have been satisfied in full.
SECTION 6. REGISTRATION PROCEDURES
(a) Exchange Offer Registration Statement. In connection with the
Exchange Offer, the Company shall comply with all of the provisions of Section
6(c) below, shall use its best efforts to effect such exchange to permit the
sale of Transfer Restricted Securities being sold in accordance with the
intended method or methods of distribution thereof, and shall comply with all
of the following provisions:
(i) If in the reasonable opinion of counsel to the Company
there is a question as to whether the Exchange Offer is permitted by
applicable law, the Company hereby agrees, to the extent reasonably
practicable, to seek a no-action letter or other favorable decision from
the Commission allowing the Company to Consummate an Exchange Offer for
such Transfer Restricted Securities. The Company hereby agrees to pursue
the issuance of such a decision to the Commission staff level but shall
not be required to take commercially unreasonable action to effect a
change of Commission policy. The Company hereby agrees, however, to (A)
participate in telephonic conferences with the Commission, (B) deliver to
the Commission staff an analysis prepared by counsel to the Company
setting forth the legal bases, if any, upon which such counsel has
concluded that such an Exchange Offer should be permitted and (C)
diligently pursue a resolution (which need not be favorable) by the
Commission staff of such submission.
(ii) As a condition to its participation in the Exchange Offer
pursuant to the terms of this Agreement, each Holder of Transfer
Restricted Securities shall furnish, upon the request of the Company,
prior to the Consummation thereof, a written representation to the
Company (which may be contained in the letter of transmittal contemplated
by the Exchange Offer Registration Statement) to the effect that (A) it
is not an Affiliate of the Company, (B) it is not engaged in, and does
not intend to engage in, and has no arrangement or understanding with any
person to participate in, a distribution of the New Preferred Stock or
the New Exchange Notes, as applicable, to be issued in the Exchange
Offer, (C) it is acquiring the New Preferred Stock or the New Exchange
Notes, as applicable, in its ordinary course of business and (D) it is
not acting on behalf of any person who
8
could not make the foregoing representations. In addition, all such
Holders of Transfer Restricted Securities shall otherwise cooperate in
the Company's preparations for the Exchange Offer. Each Holder hereby
acknowledges and agrees that any Broker-Dealer and any such Holder using
the Exchange Offer to participate in a distribution of the securities to
be acquired in the Exchange Offer (1) could not under Commission policy
as in effect on the date of this Agreement rely on the position of the
Commission enunciated in Xxxxxx Xxxxxxx and Co., Inc. (available June 5,
1991) and Exxon Capital Holdings Corporation (available May 13, 1988), as
interpreted in the Commission's letter to Xxxxxxxx & Sterling dated July
2, 1993, and similar no-action letters (including, if applicable, any
no-action letter obtained pursuant to clause (i) above), and (2) must
comply with the registration and prospectus delivery requirements of the
Act in connection with a secondary resale transaction and that such a
secondary resale transaction should be covered by an effective
registration statement containing the selling security holder information
required by Item 507 or 508, as applicable, of Regulation S-K if the
resales are of New Preferred Stock or New Exchange Notes, as applicable,
obtained by such Holder in exchange for Preferred Stock or Exchange
Notes, as applicable, acquired by such Holder directly from the Company.
(iii) Prior to effectiveness of the Exchange Offer Registration
Statement, the Company shall provide a supplemental letter to the
Commission (A) stating that the Company is registering the Exchange Offer
in reliance on the position of the Commission enunciated in Exxon Capital
Holdings Corporation (available May 13, 1988), Xxxxxx Xxxxxxx and Co.,
Inc. (available June 5, 1991) and, if applicable, any no-action letter
obtained pursuant to clause (i) above and (B) including a representation
that the Company has not entered into any arrangement or understanding
with any Person to distribute the New Preferred Stock or the New Exchange
Notes, as applicable, to be received in the Exchange Offer and that, to
the best of the Company's information and belief, each Holder
participating in the Exchange Offer is acquiring the New Preferred Stock
or the New Exchange Notes, as applicable, in its ordinary course of
business and has no arrangement or understanding with any Person to
participate in the distribution of the New Preferred Stock or the New
Exchange Notes, as applicable, received in the Exchange Offer and (C) any
other undertaking or representation required by the Commission as set
forth in any no-action letter obtained pursuant to clause (i) above, if
applicable.
(b) Shelf Registration Statement. In connection with the Shelf
Registration Statement, the Company shall comply with all the provisions of
Section 6(c) below and shall use its best efforts to effect such registration
to permit the sale of the Transfer Restricted Securities being sold in
accordance with the intended method or methods of distribution thereof (as
indicated in the information furnished to the Company pursuant to Section 4(b)
hereof), and pursuant thereto the Company will prepare and file with the
Commission a Registration Statement relating to the registration on any
appropriate form under the Act, which form shall be available for the sale of
the Transfer Restricted Securities in accordance with the intended method or
methods of distribution thereof within the time periods and otherwise in
accordance with the provisions hereof.
(c) General Provisions. In connection with any Registration
Statement and any related Prospectus required by this Agreement to permit the
sale or resale of Transfer Restricted Securities (including, without
limitation, any Registration Statement and the related Prospectus required to
permit sales of Transfer Restricted Securities by Broker-Dealers), the Company
shall:
(i) use their best efforts to keep such Registration Statement
continuously effective and provide all requisite financial statements
(including, if required by the Act or any regulation
9
thereunder, financial statements of any Restricted Subsidiary) for the
period specified in Section 3 or 4 of this Agreement, as applicable; upon
the occurrence of any event that would cause any such Registration
Statement or the Prospectus contained therein (A) to contain a material
misstatement or omission or (B) not to be effective and usable for resale
of Transfer Restricted Securities during the period required by this
Agreement, the Company shall file promptly an appropriate amendment to
such Registration Statement, in the case of clause (A), correcting any
such misstatement or omission, and, in the case of either clause (A) or
(B), use their best efforts to cause such amendment to be declared
effective and such Registration Statement and the related Prospectus to
become usable for their intended purpose(s) as soon as practicable
thereafter;
(ii) prepare and file with the Commission such amendments and
post-effective amendments to the applicable Registration Statement as may
be necessary to keep such Registration Statement effective for the
applicable period set forth in Section 3 or 4 hereof, as applicable, or
such shorter period as will terminate when all Transfer Restricted
Securities covered by such Registration Statement have been sold; cause
the Prospectus to be supplemented by any required Prospectus supplement,
and as so supplemented to be filed pursuant to Rule 424 under the Act,
and to comply fully with the applicable provisions of Rules 424 and 430A
under the Act in a timely manner; and comply with the provisions of the
Act with respect to the disposition of all securities covered by such
Registration Statement during the applicable period in accordance with
the intended method or methods of distribution by the sellers thereof set
forth in such Registration Statement or supplement to the Prospectus;
(iii) advise the underwriter(s), if any, and selling Holders
promptly and, if requested by such Persons, to confirm such advice in
writing, (A) when the Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to any
applicable Registration Statement or any post-effective amendment
thereto, when the same has become effective, (B) of any request by the
Commission for amendments to the Registration Statement or amendments or
supplements to the Prospectus or for additional information relating
thereto, (C) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement under the Act
or of the suspension by any state securities commission of the
qualification of the Transfer Restricted Securities for offering or sale
in any jurisdiction, or the initiation of any proceeding for any of the
preceding purposes, (D) of the existence of any fact or the happening of
any event that makes any statement of a material fact made in the
Registration Statement, the Prospectus, any amendment or supplement
thereto, or any document incorporated by reference therein untrue, or
that requires the making of any additions to or changes in the
Registration Statement or the Prospectus in order to make the statements
therein not misleading. If at any time the Commission shall issue any
stop order suspending the effectiveness of the Registration Statement, or
any state securities commission or other regulatory authority shall issue
an order suspending the qualification or exemption from qualification of
the Transfer Restricted Securities under state securities or Blue Sky
laws, the Company shall use its best efforts to obtain the withdrawal or
lifting of such order at the earliest possible time;
(iv) furnish to each of the selling Holders named in any
Registration Statement or Prospectus and each of the underwriter(s) in
connection with such sale, if any, before filing with the Commission,
copies of any Registration Statement or any Prospectus included therein
or any amendments or supplements to any such Registration Statement or
Prospectus (including all documents incorporated by reference after the
initial filing of such Registration Statement), which documents will be
subject to the review of such Holders and underwriter(s), if any, for a
period of
10
at least five Business Days, and the Company will not file any such
Registration Statement or Prospectus or any amendment or supplement to
any such Registration Statement or Prospectus (including all such
documents incorporated by reference) to which a selling Holder of
Transfer Restricted Securities covered by such Registration Statement or
the underwriter(s) in connection with such sale, if any, shall reasonably
object within five Business Days after the receipt thereof. A selling
Holder or underwriter, if any, shall be deemed to have reasonably
objected to such filing if such Registration Statement, amendment,
Prospectus or supplement, as applicable, as proposed to be filed,
contains a material misstatement or omission or fails to materially
comply with the applicable requirements of the Act;
(v) promptly prior to the filing of any document that is to be
incorporated by reference into a Registration Statement or Prospectus,
provide copies of such document to the selling Holders covered by such
Registration Statement and to the underwriter(s) in connection with such
sale, if any, make the Company's representatives available for discussion
of such document and other customary due diligence matters on reasonable
prior notice, and include such information in such document prior to the
filing thereof as such selling Holders or underwriter(s), if any,
reasonably may request within five Business Days of the receipt of the
proposed filing;
(vi) make available at reasonable times for inspection by the
selling Holders, any underwriter participating in any disposition
pursuant to such Registration Statement, and any attorney or accountant
retained by such selling Holders or any of the underwriter(s), all
financial and other records, pertinent corporate documents and properties
of the Company and cause the Company's officers, directors and employees
to supply all information reasonably requested by any such Holder,
underwriter, attorney or accountant in connection with such Registration
Statement subsequent to the filing thereof and prior to its
effectiveness;
(vii) if requested by any selling Holders covered by such
Registration Statement or the underwriter(s) in connection with such
sale, if any, promptly incorporate in any Registration Statement or
Prospectus, pursuant to a supplement or post-effective amendment if
necessary, such information as such selling Holders and underwriter(s),
if any, may reasonably request to have included therein, including,
without limitation, information relating to the "Plan of Distribution" of
the Transfer Restricted Securities, information with respect to the
Liquidation Amount or the principal amount, as applicable, of Transfer
Restricted Securities being sold to such underwriter(s), the purchase
price being paid therefor and any other terms of the offering of the
Transfer Restricted Securities to be sold in such offering; and make all
required filings of such Prospectus supplement or post-effective
amendment as soon as practicable after the Company is notified of the
matters to be incorporated in such Prospectus supplement or
post-effective amendment;
(viii) cause the Transfer Restricted Securities covered by the
Registration Statement to be rated with the appropriate rating agencies,
if so requested by the Holders of a majority in aggregate Liquidation
Amount of Preferred Stock or aggregate principal amount of Exchange
Notes, as applicable, covered thereby or the underwriter(s), if any;
(ix) furnish to each selling Holder covered by such
Registration Statement and each of the underwriter(s) in connection with
such sale, if any, without charge, at least one copy of the Registration
Statement, as first filed with the Commission, and of each amendment
thereto, including all documents incorporated by reference therein and
all exhibits (including exhibits incorporated therein by reference);
11
(x) deliver to each selling Holder and to each of the
underwriter(s), if any, without charge, as many copies of the Prospectus
(including each preliminary prospectus) and any amendment or supplement
thereto as such Persons reasonably may request; the Company hereby
consents to the use of the Prospectus and any amendment or supplement
thereto by each of the selling Holders and each of the underwriter(s), if
any, in connection with the offering and the sale of the Transfer
Restricted Securities covered by the Prospectus or any amendment or
supplement thereto, provided that the Company has not advised such
persons otherwise pursuant to Section 6(c)(iii);
(xi) enter into such agreements (including an underwriting
agreement), and make such representations and warranties, and take all
such other actions in connection therewith in order to expedite or
facilitate the disposition of the Transfer Restricted Securities pursuant
to any Registration Statement contemplated by this Agreement, all to such
extent as may be requested by any Initial Purchaser or by any Holder of
Transfer Restricted Securities or underwriter in connection with any sale
or resale pursuant to any Registration Statement contemplated by this
Agreement; and whether or not an underwriting agreement is entered into
and whether or not the registration is an Underwritten Registration, the
Company shall:
(A) furnish to the Initial Purchaser, each selling Holder and
each underwriter, if any, in such substance and scope as they may
request and as are customarily made by issuers to underwriters in
primary underwritten offerings, upon the date of the Consummation of
the Exchange Offer and, if applicable, the effectiveness of the
Shelf Registration Statement:
(1) a certificate, dated the date of the Consummation of
the Exchange Offer or the date of the effectiveness of the
Shelf Registration Statement, as the case may be, signed by (y)
the President or any Vice President and (z) a principal
financial or accounting officer of the Company, confirming, as
of the date thereof, the matters set forth in paragraphs (a),
(b), (c) and (d) of Section 9 of the Purchase Agreement and
such other matters as such parties may reasonably request;
(2) an opinion, dated the date of Consummation of the
Exchange Offer or the date of effectiveness of the Shelf
Registration Statement, as the case may be, of counsel for the
Company, covering the matters set forth in paragraph (h) of
Section 9 of the Purchase Agreement and such other matters as
such parties may reasonably request, and in any event including
a statement to the effect that such counsel has participated in
conferences with officers and other representatives of the
Company, representatives of the independent public accountants
for the Company, and have considered the matters required to be
stated therein and the statements contained therein, although
such counsel has not independently verified the accuracy,
completeness or fairness of such statements; and that such
counsel advises that, on the basis of the foregoing (relying as
to materiality to a large extent upon facts provided to such
counsel by officers and other representatives of the Company
and the and without independent check or verification), no
facts came to such counsel's attention that caused such counsel
to believe that the applicable Registration Statement, at the
time such Registration Statement or any post-effective
amendment thereto became effective, and, in the case of the
Exchange Offer Registration Statement, as of the date of
Consummation, contained an untrue statement of a material fact
or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not
misleading, or that the Prospectus contained in such
Registration Statement as of its date and, in the case of the
opinion dated the date of Consummation of the Exchange Offer,
as of the date of
12
Consummation, contained an untrue statement of a material fact
or omitted to state a material fact necessary in order to make
the statements therein, in light of the circumstances under
which they were made, not misleading. Without limiting the
foregoing, such counsel may state further that such counsel
assumes no responsibility for, and has not independently
verified, the accuracy, completeness or fairness of the
financial statements, notes and schedules and other financial
data included in any Registration Statement contemplated by
this Agreement or the related Prospectus; and
(3) provided that the requesting Holders, underwriters,
if any, or other such financial intermediary furnish the
undertaking required in SAS 72, if required, a customary
comfort letter, dated as of the date of Consummation of the
Exchange Offer or the date of effectiveness of the Shelf
Registration Statement, as the case may be, from the Company's
independent accountants, in the customary form and covering
matters of the type customarily covered in comfort letters by
underwriters in connection with primary underwritten offerings;
(B) set forth in full or incorporate by reference in the
underwriting agreement, if any, the indemnification provisions and
procedures of Section 8 hereof with respect to all parties to be
indemnified pursuant to said Section; and
(C) deliver such other documents and certificates as may be
reasonably requested by such parties to evidence compliance with
clause (A) above and with any customary conditions contained in the
underwriting agreement or other agreement entered into by the
Company pursuant to this clause (xi), if any.
If at any time the representations and warranties of the Company
contemplated in clause (A)(1) above cease to be true and correct, the
Company shall so advise the Initial Purchaser and the underwriter(s), if
any, and each selling Holder promptly and, if requested by such Persons,
shall confirm such advice in writing;
(xii) prior to any public offering of Transfer Restricted
Securities, cooperate with the selling Holders, the underwriter(s), if
any, and their respective counsel in connection with the registration and
qualification of the Transfer Restricted Securities under the securities
or Blue Sky laws of such jurisdictions as the selling Holders or
underwriter(s), if any, may request and do any and all other acts or
things necessary or advisable to enable the disposition in such
jurisdictions of the Transfer Restricted Securities covered by the
applicable Registration Statement; provided, however, that the Company
shall not be required to register or qualify as a foreign corporation
where it is not now so qualified or to take any action that would subject
it to the service of process in suits or to taxation, other than as to
matters and transactions relating to the Registration Statement, in any
jurisdiction where it is not now so subject;
(xiii) upon the request of any Preferred Stock or Exchange
Notes, as applicable, covered by the Shelf Registration Statement
contemplated by this Agreement, issue New Preferred Stock having an
aggregate Liquidation Amount equal to the aggregate Liquidation Amount of
the Preferred Stock or New Exchange Notes having an aggregate principal
amount equal to the aggregate principal amount of the Exchange Notes, as
applicable, surrendered to the Company by such Holder in exchange
therefor or being sold by such Holder; such New Preferred Stock or New
Exchange Notes, as applicable, to be registered in the name of such
Holder or in the name of the purchaser(s) of such
13
New Preferred Stock or New Exchange Notes, as applicable; in return, the
Preferred Stock or the Exchange Notes, as applicable, held by such Holder
shall be surrendered to the Company for cancellation;
(xiv) in connection with any sale of Transfer Restricted
Securities that will result in such securities no longer being Transfer
Restricted Securities, cooperate with the selling Holders and the
underwriter(s), if any, to facilitate the timely preparation and delivery
of certificates representing Transfer Restricted Securities to be sold
and not bearing any restrictive legends; and enable such Transfer
Restricted Securities to be in such denominations and registered in such
names as the Holders or the underwriter(s), if any, may request at least
two Business Days prior to any sale of Transfer Restricted Securities
made by such underwriter(s);
(xv) use its best efforts to cause the Transfer Restricted
Securities covered by the Registration Statement to be registered with or
approved by such other governmental agencies or authorities as may be
necessary to enable the seller or sellers thereof or the underwriter(s),
if any, to consummate the disposition of such Transfer Restricted
Securities;
(xvi) if any fact or event contemplated by clause 6(c)(iii)(D)
hereof shall exist or have occurred, prepare a supplement or
post-effective amendment to the Registration Statement or related
Prospectus or any document incorporated therein by reference or file any
other required document so that, as thereafter delivered to the
purchasers of Transfer Restricted Securities, the Prospectus will not
contain 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;
(xvii) provide a CUSIP number for all Transfer Restricted
Securities not later than the effective date of the Registration
Statement and provide the Transfer Agent or the Exchange Note Trustee, as
applicable, with printed certificates for the Transfer Restricted
Securities which are in a form eligible for deposit with the Depository
Trust Company;
(xviii) cooperate and assist in any filings required to be made
with the NASD and in the performance of any due diligence investigation
by any underwriter (including any "qualified independent underwriter")
that is required to be retained in accordance with the rules and
regulations of the NASD, and use its reasonable best efforts to cause
such Registration Statement to become effective and approved by such
governmental agencies or authorities as may be necessary to enable the
Holders selling Transfer Restricted Securities to consummate the
disposition of such Transfer Restricted Securities;
(xix) otherwise use its best efforts to comply with all
applicable rules and regulations of the Commission, and make generally
available to its security holders, as soon as practicable, a consolidated
earnings statement meeting the requirements of Rule 158 (which need not
be audited) for the twelve-month period (A) commencing at the end of any
fiscal quarter in which Transfer Restricted Securities are sold to
underwriters in a firm or best efforts Underwritten Offering or (B) if
not sold to underwriters in such an offering, beginning with the first
month of the Company's first fiscal quarter commencing after the
effective date of the Registration Statement;
(xx) make appropriate officers of the Company available to the
selling Holders for meeting with prospective purchasers of the Transfer
Restricted Securities and prepare and present to potential
14
investors customary "road show" material in a manner consistent with
other new issuances of other securities similar to the Transfer
Restricted Securities;
(xxi) if the Exchange Notes have been issued, cause the
Exchange Indenture to be qualified under the TIA not later than the
effective date of the first Registration Statement required by this
Agreement, and, in connection therewith, cooperate with the Exchange Note
Trustee and the Holders of Exchange Notes to effect such changes to the
Exchange Indenture as may be required for such Exchange Indenture to be
so qualified in accordance with the terms of the TIA; and execute and use
its best efforts to cause the Exchange Note Trustee to execute, all
documents that may be required to effect such changes and all other forms
and documents required to be filed with the Commission to enable such
Exchange Indenture to be so qualified in a timely manner;
(xxii) use its best efforts to cause all Transfer Restricted
Securities covered by the Registration Statement to be listed on each
securities exchange on which similar securities issued by the Company are
then listed if requested by the Holders of a majority in aggregate
Liquidation Amount of Preferred Stock or aggregate principal amount of
Exchange Notes, as applicable, or the managing underwriter(s), if any;
and
(xxiii) provide promptly to each Holder upon request each
document filed with the Commission pursuant to the requirements of
Section 13 and Section 15 of the Exchange Act.
Each Holder agrees by acquisition of a Transfer Restricted Security
that, upon receipt of the notice referred to in Section 6(c)(i) or any notice
from the Company of the existence of any fact of the kind described in Section
6(c)(iii)(D) hereof, (in each case, a "Suspension Notice") such Holder will
forthwith discontinue disposition of Transfer Restricted Securities pursuant to
the applicable Registration Statement until (i) such Xxxxxx's receipt of the
copies of the supplemented or amended Prospectus contemplated by Section
6(c)(xvi) hereof, or (ii) such Holder is advised in writing by the Company that
the use of the Prospectus may be resumed, and has received copies of any
additional or supplemental filings that are incorporated by reference in the
Prospectus (in each case, the "Recommencement Date"). If so directed by the
Company, each Holder receiving a Suspension Notice will deliver to the Company
(at the Company's expense) all copies, other than permanent file copies then in
such Holder's possession, of the Prospectus covering such Transfer Restricted
Securities that was current at the time of receipt of such notice. In the event
the Company shall give any such notice, the time period regarding the
effectiveness of such Registration Statement set forth in Section 3 or 4
hereof, as applicable, shall be extended by the number of days equal to the
number of days in the period from and including the date of the Suspension
Notice to and including the Recommencement Date.
SECTION 7. REGISTRATION EXPENSES
(a) All expenses incident to the Company's performance of or
compliance with this Agreement will be borne by the Company, regardless of
whether a Registration Statement becomes effective, including without
limitation: (i) all registration and filing fees and expenses (including
filings made by any Initial Purchaser or Holder with the NASD (and, if
applicable, the fees and expenses of any "qualified independent underwriter"
and its counsel that may be required by the rules and regulations of the
NASD)); (ii) all fees and expenses of compliance with federal securities and
state Blue Sky or securities laws; (iii) all expenses of printing (including
printing certificates for the New Preferred Stock or the New Exchange Notes, as
applicable, to be issued in the Exchange Offer and printing of Prospectuses),
messenger and
15
delivery services and telephone; (iv) all fees and disbursements of counsel for
the Company and, subject to Section 7(b) below, the Holders of Transfer
Restricted Securities; (v) all application and filing fees in connection with
listing New Preferred Stock or the New Exchange Notes, as applicable, on a
national securities exchange or automated quotation system pursuant to the
requirements hereof; and (vi) all fees and disbursements of independent
certified public accountants of the Company (including the expenses of any
special audit and comfort letters required by or incident to such performance).
The Company will, in any event, bear their internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), the expenses of any annual
audit and the fees and expenses of any Person, including special experts,
retained by the Company.
(b) In connection with any Registration Statement required by this
Agreement (including, without limitation, the Exchange Offer Registration
Statement and the Shelf Registration Statement), the Company will reimburse the
Initial Purchaser and the Holders of Transfer Restricted Securities being
tendered in the Exchange Offer and/or resold pursuant to the "Plan of
Distribution" contained in the Exchange Offer Registration Statement or
registered pursuant to the Shelf Registration Statement, as applicable, for the
reasonable fees and disbursements of not more than one counsel, who may be
chosen by the Holders of a majority in Liquidation Amount or principal amount,
as applicable, of the Transfer Restricted Securities for whose benefit such
Registration Statement is being prepared.
SECTION 8. INDEMNIFICATION
(a) The Company agrees to indemnify and hold harmless (i) each
Holder, (ii) each person, if any, who controls any Holder within the meaning of
Section 15 of the Act or Section 20(a) of the Exchange Act and (iii) the
respective officers, directors, partners, employees, representatives and agents
of any Holder or any controlling person (any person referred to in clause (i),
(ii) or (iii) may hereinafter be referred to as an "Indemnified Holder") to the
fullest extent lawful, from and against any and all losses, liabilities,
claims, damages and expenses whatsoever (including but not limited to
attorneys' fees and any and all expenses whatsoever incurred in investigating,
preparing or defending against any investigation or litigation, commenced or
threatened, or any claim whatsoever, and any and all amounts paid in settlement
of any claim or litigation), joint or several, to which they or any of them may
become subject under the Act, the Exchange Act or otherwise, insofar as such
losses, liabilities, claims, damages or expenses (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 Registration Statement,
preliminary prospectus filed as part of the Registration Statement, Shelf
Registration Statement or in any supplement thereto or amendment thereof, 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, in the light of the circumstances under which they were
made, not misleading; provided, however, that the Company will not be liable in
any such case to the extent, but only to the extent, that any such loss,
liability, claim, damage or expense (i) 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 the Initial Purchaser or Holders
expressly for use therein or (ii) if a subsequent purchaser asserts that its
losses, liabilities, claims, damages and expenses was caused by any untrue
statement or omission, or any alleged untrue statement or omission, made in a
preliminary prospectus, if a copy of the Registration Statement in which such
untrue statement or omission or alleged untrue statement or omission was
corrected had not been sent or given to such subsequent purchaser by
16
the Holder provided that the Company had delivered to the Holder such
Registration Statement in requisite quantity and on a timely basis to permit
such delivery. This indemnity agreement will be in addition to any liability
which the Company may otherwise have, including, under this Agreement.
(b) Each Holder, severally and not jointly, agrees to indemnify and
hold harmless (i) each of the Company (ii) each person, if any, who controls
the Company within the meaning of Section 15 of the Act or Section 20(a) of the
Exchange Act and (iii) their respective officers, directors, partners, members,
employees, representatives and agents or any controlling person to the fullest
extent lawful from and against any losses, liabilities, claims, damages and
expenses whatsoever (including but not limited to attorneys' fees and any and
all expenses whatsoever incurred in investigating, preparing or defending
against any investigation or litigation, commenced or threatened, or any claim
whatsoever and any and all amounts paid in settlement of any claim or
litigation), joint or several, to which they or any of them may become subject
under the Act, the Exchange Act or otherwise, insofar as such losses,
liabilities, claims, damages or expenses (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 Registration Statement, Shelf Registration
Statement, or preliminary prospectus filed as a part thereof, 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, in the light of the
circumstances under which they were made, not misleading, in each case to the
extent, but only to the extent, that any such loss, liability, claim, damage or
expense arises out of or is based upon any 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
that Holder expressly for use therein; provided, however, that in no case shall
any Holder be liable or responsible for any amount in excess of the dollar
amount of the proceeds received by such Holder upon the sale of the Transfer
Restricted Securities giving rise to such indemnification obligation. This
indemnity will be in addition to any liability which any Holder may otherwise
have, including under this Agreement.
(c) In case any action shall be commenced involving any Person in
respect of which indemnity may be sought pursuant to Section 8(a) or 8(b) (the
"indemnified party"), promptly after receipt by an indemnified party of notice
of the commencement of any action, such indemnified party shall, if a claim in
respect thereof is to be made against the person against whom indemnity may be
sought (the "indemnifying party"), notify such indemnifying party in writing of
the commencement thereof (but the failure to so notify an indemnifying party
shall not relieve it from any liability which it may have under this Section 8
except to the extent that it has been prejudiced in any material respect by
such failure or from any liability which it may otherwise have). In case any
such action is brought against any indemnified party, and it notifies an
indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein, and to the extent it may elect by written
notice delivered to the indemnified party promptly after receiving the
aforesaid notice from such indemnified party, to assume the defense thereof
with counsel reasonably satisfactory to such indemnified party. Notwithstanding
the foregoing, the indemnified party or parties shall have the right to employ
its or their own counsel in any such case, but the fees and expenses of such
counsel shall be at the expense of such indemnified party or parties unless (i)
the employment of such counsel shall have been authorized in writing by the
indemnifying parties in connection with the defense of such action, (ii) the
indemnifying parties shall not have employed counsel to take charge of the
defense of such action within a reasonable time after notice of commencement of
the action, or (iii) such indemnified party or parties shall have reasonably
concluded that there may be defenses available to it or them which are
different from or additional to those available to one or all of the
indemnifying parties (in which case the indemnifying party or parties shall not
have the right to direct the defense of such action on behalf of the
indemnified party or parties), in any of
17
which events such fees and expenses of counsel shall be borne by the
indemnifying parties; provided, however, that the indemnifying party under
subsection (a) or (b) above, shall only be liable for the legal expenses of one
counsel (in addition to any local counsel) for all indemnified parties in each
jurisdiction in which any claim or action is brought. Anything in this
subsection to the contrary notwithstanding, an indemnifying party shall not be
liable for any settlement of any claim or action effected without its prior
written consent; provided, however, that such consent was not unreasonably
withheld.
(d) In order to provide for contribution in circumstances in which
the indemnification provided for in this Section 8 is for any reason held to be
unavailable from the Company or is insufficient to hold harmless a party
indemnified thereunder, the Company, on the one hand, and the Holders, on the
other hand, shall contribute to the aggregate losses, claims, damages,
liabilities and expenses of the nature contemplated by such indemnification
provision (including any investigation, legal and other expenses incurred in
connection with, and any amount paid in settlement of, any action, suit or
proceeding or any claims asserted, but after deducting in the case of losses,
claims, damages, liabilities and expenses suffered by the Company, any
contribution received by the Company from persons, other than the Holders, who
may also be liable for contribution, including persons who control the Company
within the meaning of Section 15 of the Act or Section 20(a) of the Exchange
Act) to which the Company, and any Holder may be subject, in such proportion as
is appropriate to reflect the relative benefits received by the Company, on one
hand, and the Holder, on the other hand, from their sale of Transfer Restricted
Securities or, if such allocation is not permitted by applicable law or
indemnification is not available as a result of the indemnifying party not
having received notice as provided in this Section 8, in such proportion as is
appropriate to reflect the relative fault of the Company, on one hand, and the
Holder, on the other hand, in connection with the statements or omissions which
resulted in such losses, claims, damages, liabilities or expenses, as well as
any other relevant equitable considerations. The relative fault of the Company,
on one hand, and of the Holder, on the other hand, shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the Company, or the Holder and
the parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission. The Company and the Holders
agree that it would not be just and equitable if contribution pursuant to this
Section 8 were determined by pro rata allocation or by any other method of
allocation which does not take into account the equitable considerations
referred to above. Notwithstanding the provisions of this Section 8, (i) in no
case shall any Holder be required to contribute any amount in excess of the
amount by which the total value of the Preferred Stock or the Exchange Notes,
as applicable, held by such Holder exceeds the amount of any damages which such
Holder has otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission and (ii) 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 8, (A) each person,
if any, who controls any Holder within the meaning of Section 15 of the Act or
Section 20(a) of the Exchange Act and (B) the respective officers, directors,
partners, employees, representatives and agents of any Holder or any
controlling person shall have the same rights to contribution as such Holder,
and each person, if any, who controls the Company within the meaning of Section
15 of the Act or Section 20(a) of the Exchange Act shall have the same rights
to contribution as the Company, subject in each case to clauses (i) and (ii) of
this Section 8(d). Any party entitled to contribution will, promptly after
receipt of notice of commencement of any action, suit or proceeding against
such party in respect of which a claim for contribution may be made against
another party or parties under this Section 8, notify such party or parties
from whom contribution may be sought, but the failure to so notify such party
or parties shall not relieve the party or parties from whom contribution may be
sought from any obligation it or they may have under this Section 8 or
otherwise.
18
No party shall be liable for contribution with respect to any action or claim
settled without its prior written consent; provided, however, that such written
consent was not unreasonably withheld.
SECTION 9. RULE 144A
The Company hereby agrees with each Holder, for so long as any
Transfer Restricted Securities remain outstanding, to make available, upon
request, to any Holder or beneficial owner of Transfer Restricted Securities in
connection with any sale thereof and any prospective purchaser of such Transfer
Restricted Securities from such Holder or beneficial owner, the information
required by Rule 144A(d)(4) under the Act in order to permit resales of such
Transfer Restricted Securities pursuant to Rule 144A.
SECTION 10. PARTICIPATION IN UNDERWRITTEN REGISTRATIONS
No Holder may participate in any Underwritten Registration hereunder
unless such Xxxxxx (a) agrees to sell such Xxxxxx's Transfer Restricted
Securities on the basis provided in any underwriting arrangements approved by
the Persons entitled hereunder to approve such arrangements and (b) completes
and executes all reasonable questionnaires, powers of attorney, indemnities,
underwriting agreements, lock-up letters and other documents required under the
terms of such underwriting arrangements.
SECTION 11. SELECTION OF UNDERWRITERS
The Holders of Transfer Restricted Securities covered by the Shelf
Registration Statement who desire to do so may sell such Transfer Restricted
Securities in an Underwritten Offering. In any such Underwritten Offering, the
investment banker or investment bankers and manager or managers that will
administer the offering will be selected by the Holders of a majority in
aggregate Liquidation Amount or principal amount, as applicable, of the
Transfer Restricted Securities included in such offering; provided, that such
investment bankers and managers must be reasonably satisfactory to the Company.
SECTION 12. MISCELLANEOUS
(a) Remedies. The Company agrees that any failure by the Company to
comply with its obligations under Sections 3 and 4 hereof may result in
material irreparable injury to the Initial Purchaser or the Holders for which
there is no adequate remedy at law, that it will not be possible to measure
damages for such injuries precisely and that, in the event of any such failure,
the Initial Purchaser or any Holder may obtain such relief as may be required
to specifically enforce the Company's obligations under Sections 3 and 4
hereof. The Company agrees to waive the defense in any action for specific
performance that a remedy at law would be adequate.
(b) No Inconsistent Agreements. The Company will not on or after the
date of this Agreement, enter into any agreement with respect to its securities
that is inconsistent with the rights granted to the Holders in this Agreement
or otherwise conflicts with the provisions hereof. The Company has not
previously entered into any agreement granting any registration rights with
respect to its securities to any Person, excluding the registration rights
granted to the Sweetheart Stockholders and holders of the Senior Secured
Discount Notes. The rights granted to the Holders hereunder do not in any way
conflict with and
19
are not inconsistent with the rights granted to the holders of the Company's
securities under any agreement in effect on the date hereof.
(c) Adjustments Affecting the Preferred Stock or the Exchange Notes.
The Company will not take any action, or permit any change to occur, with
respect to the Preferred Stock or the Exchange Notes, as applicable, that would
materially and adversely affect the ability of the Holders to Consummate any
Exchange Offer.
(d) Amendments and Waivers. The provisions of this Agreement may not
be amended, modified or supplemented, and waivers or consents to or departures
from the provisions hereof may not be given unless the Company has obtained the
written consent of Holders of a majority of the outstanding Liquidation Amount
or principal amount, as applicable, of Transfer Restricted Securities.
Notwithstanding the foregoing, a waiver or consent to departure from the
provisions hereof that relates exclusively to the rights of Holders whose
securities are being tendered pursuant to the Exchange Offer and that does not
affect directly or indirectly the rights of other Holders whose securities are
not being tendered pursuant to such Exchange Offer may be given by the Holders
of a majority of the outstanding Liquidation Amount or principal amount, as
applicable, of Transfer Restricted Securities being tendered or registered.
(e) Notices. All notices and other communications provided for or
permitted hereunder shall be made in writing by hand-delivery, first-class mail
(registered or certified, return receipt requested), telex, telecopier, or air
courier guaranteeing overnight delivery:
(i) if to a Holder, at the address set forth on the records of
the Transfer Agent or the Exchange Note Trustee, as the case may be; and
(ii) if to the Company:
SF Holdings Group, Inc.
000 Xxxxxxx Xxxxxx
Xxxxxxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxx X. Xxxxxxxx, General Counsel
With a copy to:
Kramer, Levin, Xxxxxxxx & Xxxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx
All such notices and communications shall be deemed to have been
duly given: at the time delivered by hand, if personally delivered; five
Business Days after being deposited in the mail, postage prepaid, if mailed;
when answered back, if telexed; when receipt acknowledged, if telecopied; and
on the next Business Day, if timely delivered to an air courier guaranteeing
overnight delivery.
20
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Transfer Agent or
the Exchange Note Trustee, as applicable, at the address specified in the
Restated Articles of Incorporation or the Exchange Indenture, as applicable.
(f) 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 limitation and without the need for an express
assignment, subsequent Holders of Transfer Restricted Securities; provided,
however, that this Agreement shall not inure to the benefit of or be binding
upon a successor or assign of a Holder unless and to the extent such successor
or assign acquired Transfer Restricted Securities from such Holder.
(g) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
(h) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE
CONFLICT OF LAW RULES THEREOF.
(j) Severability. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the
remaining provisions contained herein shall not be affected or impaired
thereby.
(k) Entire Agreement. This Agreement together with the other
Operative Documents (as defined in the Purchase Agreement) is intended by the
parties as a final expression of their agreement and intended to be a complete
and exclusive statement of the agreement and understanding of the parties
hereto in respect of the subject matter contained herein. There are no
restrictions, promises, warranties or undertakings, other than those set forth
or referred to herein with respect to the registration rights granted by the
Company with respect to the Transfer Restricted Securities. This Agreement
supersedes all prior agreements and understandings between the parties with
respect to such subject matter.
21
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
SF HOLDINGS GROUP, INC.
By: /s/ Xxxx Xxxxxxx
--------------------------------
Name: Xxxx Xxxxxxx
Title:
For purposes of Section 5 only,
AMERICAN INDUSTRIAL PARTNERS MANAGEMENT COMPANY, INC.
By: /s/ X. Xxxxxxx Xxxxxxx
--------------------------------
Name: X. Xxxxxxx Xxxxxxx
Title:
BEAR, XXXXXXX & CO. INC.
By: /s/ Xxxxx X. Xxxx
--------------------------------
Name: Xxxxx X. Xxxx
Title:
SCHEDULE I
American Industrial Partners Capital Fund, X.X.
Xxxxxx Bank, N.A., as Trustee for First Plaza Group Trust
Leewsay & Co.
Xxxxxx X. Xxxxx
Xxxxxx X. Xxxxx
Xxxxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxxx
Xxxxxxxx X. Xxxx, Xx.
Xxxxxxx X. XxXxxxxxxx
24
