Registration Rights Agreement - National Fiberstok Corp., BT Securities Corp. and Donaldson, Lufkin & Jenrette Securities Corp.
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REGISTRATION RIGHTS AGREEMENT
Dated as of June 28, 1996
by and among
NATIONAL FIBERSTOK CORPORATION,
THE GUARANTORS NAMED HEREIN
and
BT SECURITIES CORPORATION
and
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
(as Initial Purchasers)
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$100,000,000
11 5/8% SENIOR NOTES DUE 2002
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This Registration Rights Agreement is dated as of June 28, 1996, by
and among National Fiberstok Corporation, a Delaware corporation (the
"COMPANY"), each of the subsidiaries of the Company listed on the signature
pages hereto as a Guarantor (collectively, the "GUARANTORS" and, together with
the Company, the "ISSUERS"), BT Securities Corporation ("BT"), Donaldson,
Lufkin & Jenrette Securities Corporation ("DLJ" and, together with BT, the
"INITIAL PURCHASERS").
This Agreement is made pursuant to the Purchase Agreement, dated
June 21, 1996, among the Company, the Guarantors and Initial Purchasers (the
"PURCHASE AGREEMENT"). In order to induce the Initial Purchasers to enter
into the Purchase Agreement, the Issuers have agreed to provide the registration
rights provided for in this Agreement to the Initial Purchasers and their
respective direct and indirect transferees and assigns. The execution and
delivery of this Agreement is a condition to the closing of the transactions
contemplated by the Purchase Agreement.
The parties hereby agree as follows:
1. DEFINITIONS
As used in this Agreement, the following terms shall have the
following meanings:
ADDITIONAL INTEREST: As defined in Section 4(a) hereof.
AFFILIATE: With respect to any specified person, "Affiliate"
shall mean any other person directly or indirectly controlling or controlled by
or under direct or indirect common control with such specified person. For the
purposes of this definition, "control," when used with respect to any person,
means the power to direct the management and policies of such person, directly
or indirectly, whether through the ownership of voting securities, by contract
or otherwise and the terms "affiliated," controlling" and "controlled" have
meanings correlative to the foregoing.
AGREEMENT: This Registration Rights Agreement, as the same may be
amended, supplemented or modified from time to time in accordance with the terms
hereof.
BUSINESS DAY: Any day except a Saturday, a Sunday or a day on
which banking institutions in New York, New York
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generally are required or authorized by law or other government action to be
closed.
COMPANY: As defined in the preamble hereof.
CONSUMMATE OR CONSUMMATE: When used to qualify the term "Exchange
Offer", shall mean validly and lawfully to issue and deliver the Exchange Notes
pursuant to the Exchange Offer for all Notes validly tendered and not validly
withdrawn pursuant thereto in accordance with the terms of this Agreement.
CONSUMMATION DATE: The date that is 20 Business Days immediately
following the date that the Exchange Registration Statement shall have been
declared effective by the SEC.
EFFECTIVENESS PERIOD: As defined in Section 3(a) hereof.
EXCHANGE ACT: The Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated by the SEC pursuant thereto.
EXCHANGE DATE: As defined in Section 2(d) hereof.
EXCHANGE NOTES: The 11 5/8% Senior Notes due 2002 of the Company,
guaranteed on a senior basis by each of the Guarantors, that are identical to
the Notes in all material respects, except that the provisions regarding
restrictions on transfer shall be modified, as provided in the Indenture (or the
indenture pursuant to which the Exchange Notes are issued), and the issuance
thereof pursuant to the Exchange Offer shall have been registered pursuant to an
effective Registration Statement in compliance with the Securities Act.
EXCHANGE OFFER: An offer to issue, in exchange for any and all of
the Notes, a like aggregate principal amount of Exchange Notes, which offer
shall be made by the Company pursuant to Section 2 hereof.
EXCHANGE REGISTRATION STATEMENT: As defined in Section 2(a)
hereof.
GUARANTORS: As defined in the preamble hereof.
INDEMNIFIED PERSON: As defined in Section 7(a) hereof.
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INDENTURE: The Indenture, dated as of June 15, 1996, among the
Issuers and Wilmington Trust Company, as trustee thereunder, pursuant to which
the Notes are issued, as amended or supplemented from time to time in accordance
with the terms thereof.
INITIAL PURCHASERS: As defined in the preamble hereof.
ISSUE DATE: As defined in Section 2(a).
ISSUERS: As defined in the preamble hereof.
NOTES: The 11 5/8% Senior Notes due 2002 of the Company,
guaranteed on a senior basis by each of the Guarantors, issued pursuant to the
Indenture.
PARTICIPATING BROKER-DEALER: As defined in Section 2(e) hereof.
PRIVATE EXCHANGE: As defined in Section 2(c) hereof.
PRIVATE EXCHANGE NOTES: As defined in Section 2(c) hereof.
PROSPECTUS: The prospectus included in any Registration Statement
(including, without limitation, a prospectus that discloses information
previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A promulgated pursuant to the Securities
Act), as amended or supplemented by any prospectus supplement, with respect to
the terms of the offering of any portion of the Notes, Exchange Notes or Private
Exchange Notes covered by such Registration Statement, and all other amendments
and supplements to any such prospectus, including post-effective amendments, and
all material incorporated by reference or deemed to be incorporated by
reference, if any, in such prospectus.
REGISTRATION DEFAULT: As defined in Section 4(a) hereof.
REGISTRATION STATEMENT: Any registration statement of the Company
and the Guarantors that covers any of the Notes, Exchange Notes or Private
Exchange Notes pursuant to the provisions of this Agreement, including the
Prospectus, amendments and supplements to such registration statement or
Prospectus, including pre- and post-effective amendments, all exhibits thereto,
and all material incorporated by reference or
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deemed to be incorporated by reference, if any, in such registration statement.
RULE 144(k): Rule 144(k) promulgated by the SEC pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
RULE 144A: Rule 144A promulgated by the SEC pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
RULE 158: Rule 158 promulgated by the SEC pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
RULE 174: Rule 174 promulgated by the SEC pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
RULE 415: Rule 415 promulgated by the SEC pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
RULE 424: Rule 424 promulgated by the SEC pursuant to the
Securities Act, as such Rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the SEC as a replacement thereto having
substantially the same effect as such Rule.
SEC: The Securities and Exchange Commission.
SECURITIES ACT: The Securities Act of 1933, as amended, and the
rules and regulations promulgated by the SEC thereunder.
SHELF FILING EVENT: As defined in Section 3(a) hereof.
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SHELF REGISTRATION: As defined in Section 3(a) hereof.
SHELF REGISTRATION STATEMENT: As defined in Section 3(a) hereof.
SPECIAL COUNSEL: Cahill Gordon & Reindel, special counsel to the
holders of Transfer Restricted Notes, or such other counsel as shall be agreed
upon by the Issuers and holders of a majority in aggregate principal amount of
Transfer Restricted Notes, the reasonable expenses of which holders of Transfer
Restricted Notes will be reimbursed by the Issuers pursuant to Section 6 hereof.
TIA: The Trust Indenture Act of 1939, as amended.
TRANSFER RESTRICTED NOTE: Each Note, upon original issuance
thereof, and at all times subsequent thereto, each Exchange Note as to which
Section 3(a)(ii) hereof is applicable upon original issuance and at all times
subsequent thereto and each Private Exchange Note upon original issuance thereof
and at all times subsequent thereto, until in the case of any such Note,
Exchange Note or Private Exchange Note, as the case may be, the earliest to
occur of (i) the date on which any such Note has been exchanged by a person
other than a Participating Broker-Dealer for an Exchange Note (other than with
respect to an Exchange Note as to which Section 3(a)(ii) hereof applies)
pursuant to the Exchange Offer, (ii) with respect to Exchange Notes received by
Participating Broker-Dealers in the Exchange Offer, the earlier of (x) the date
on which such Exchange Note has been sold by such Participating Broker-Dealer by
means of the Prospectus contained in the Exchange Registration Statement and (y)
the date on which the Exchange Registration Statement has been effective under
the Securities Act for a period of six months after the Consummation Date, (iii)
a Shelf Registration Statement covering such Note, Exchange Note or Private
Exchange Note has been declared effective by the SEC and such Note, Exchange
Note or Private Exchange Note, as the case may be, has been disposed of in
accordance with such effective Shelf Registration Statement, (iv) the date on
which such Note, Exchange Note or Private Exchange Note, as the case may be, is
eligible for distribution to the public without volume or manner of sale
restrictions pursuant to Rule 144(k) or (v) the date on which such Note,
Exchange Note or Private Exchange Note, as the case may be, ceases to be
outstanding for purposes of the Indenture or any other indenture under which
such Exchange Note or Private Exchange Note was issued.
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TRUSTEE: The trustee under the Indenture.
UNDERWRITTEN REGISTRATION OR UNDERWRITTEN OFFERING: A
registration in connection with which securities are sold to an underwriter for
reoffering to the public pursuant to an effective Registration Statement.
2. EXCHANGE OFFER
(a) To the extent not prohibited by any applicable law or
applicable interpretation of the staff of the SEC, the Issuers shall (a) prepare
and, on or prior to 30 days after the date of original issuance of the Notes
(the "ISSUE DATE"), file with the SEC a Registration Statement under the
Securities Act with respect to an offer by the Company to the holders of the
Notes to issue and deliver to such holders, in exchange for Notes, a like
principal amount of Exchange Notes, (b) use their best efforts to cause the
Registration Statement relating to the Exchange Offer to be declared effective
by the SEC under the Securities Act on or prior to 120 days after the Issue
Date, and (c) commence the Exchange Offer and use their best efforts to issue,
on or prior to the Consummation Date, the Exchange Notes. The offer and sale of
the Exchange Notes pursuant to the Exchange Offer shall be registered pursuant
to the Securities Act on an appropriate form (the "EXCHANGE REGISTRATION
STATEMENT") and duly registered or qualified under all applicable state
securities or Blue Sky laws and will comply with all applicable tender offer
rules and regulations under the Exchange Act and state securities or Blue Sky
laws. The Exchange Offer shall not be subject to any condition, other than that
the Exchange Offer does not violate any applicable law or interpretation of the
staff of the SEC. Upon consummation of the Exchange Offer in accordance with
this Section 2, the Issuers shall have no further registration obligations other
than with respect to (i) Private Exchange Notes, (ii) Exchange Notes held by
Participating Broker-Dealers and (iii) Notes or Exchange Notes as to which
Section 3(a)(iii) hereof applies. No securities shall be included in the
Exchange Registration Statement other than the Exchange Notes.
(b) The Issuers may require each holder of Notes, as a condition
to its participation in the Exchange Offer, to represent to the Issuers and
their counsel in writing (which may be contained in the applicable letter of
transmittal) that at the time of the consummation of the Exchange Offer (i) any
Exchange Notes received by such holder will be acquired in the ordinary course
of its business, (ii) such holder will have no arrangement or understanding with
any person to participate in the
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distribution (within the meaning of the Securities Act) of the Exchange Notes
and (iii) such holder is not an Affiliate of an Issuer, or if it is an Affiliate
of an Issuer, it will comply with the registration and prospectus delivery
requirements of the Securities Act, to the extent applicable.
(c) If, prior to consummation of the Exchange Offer, either of the
Initial Purchasers hold any Notes acquired by them and having, or which are
reasonably likely to be determined to have, the status of an unsold allotment in
the initial distribution, or any other holder of Notes is not entitled to
participate in the Exchange Offer, the Company, upon the request of an Initial
Purchaser or any such holder, shall, simultaneously with the delivery of the
Exchange Notes in the Exchange Offer, issue and deliver to such Initial
Purchaser and any such holder, in exchange (the "PRIVATE EXCHANGE") for such
Notes held by such Initial Purchaser and any such holder, a like principal
amount of debt securities of the Company, guaranteed by each of the Guarantors
on a senior basis, that are identical in all material respects to the Exchange
Notes (the "PRIVATE EXCHANGE NOTES") (and which are issued pursuant to the
same indenture as the Exchange Notes). The Private Exchange Notes shall bear
the same CUSIP number as the Exchange Notes.
(d) Unless the Exchange Offer would not be permitted by any
applicable law or interpretation of the staff of the SEC, the Company shall mail
the Exchange Offer Prospectus and appropriate accompanying documents, including
appropriate letters of transmittal, to each holder of Notes providing, in
addition to such other disclosures as are required by applicable law:
that the Exchange Offer is being made pursuant to this Agreement and
that all Notes validly tendered will be accepted for exchange;
(i) the date of acceptance for exchange (the "EXCHANGE DATE"),
which date shall in no event be later than the Consummation Date (unless
otherwise required by applicable law);
(ii) that a holder of a Note electing to have a Note exchanged
pursuant to the Exchange Offer will be required to surrender such Note,
together with the enclosed letters of transmittal, to the institution and
at the address (located in the Borough of Manhattan, The City of New York)
specified in the notice prior to the close of business on the Exchange
Date; and
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(iii) that holders of Notes that do not tender all such
securities pursuant to the Exchange Offer may no longer have any
registration rights hereunder with respect to Notes not tendered.
Promptly after the Exchange Date, the Company shall:
(i) accept for exchange all Notes or portions thereof validly
tendered and not validly withdrawn pursuant to the Exchange Offer; and
(ii) deliver, or cause to be delivered, to the Trustee for
cancellation all Notes or portions thereof so accepted for exchange by the
Company, and issue, cause the Trustee under the Indenture (or the
indenture pursuant to which the Exchange Notes are issued) to
authenticate, and mail to each holder of Notes, Exchange Notes equal in
principal amount to the principal amount of the Notes surrendered by such
holder.
(e) The Issuers and each Initial Purchaser acknowledge that the
staff of the SEC has taken the position that any broker-dealer that owns
Exchange Notes that were received by such broker-dealer for its own account in
the Exchange Offer (a "PARTICIPATING BROKER-DEALER") may be deemed to be an
"underwriter" within the meaning of the Securities Act and must deliver a
prospectus meeting the requirements of the Securities Act in connection with any
resale of such Exchange Notes (other than a resale of an unsold allotment
resulting from the original offering of the Notes).
The Issuers and each Initial Purchaser also acknowledge that it is
the SEC staff's position that if the Prospectus contained in the Exchange
Registration Statement includes a plan of distribution containing a statement to
the above effect and the means by which Participating Broker-Dealers may resell
the Exchange Notes, without naming the Participating Broker-Dealers or
specifying the amount of Exchange Notes owned by them, such Prospectus may be
delivered by Participating Broker-Dealers to satisfy their prospectus delivery
obligations under the Securities Act in connection with resales of Exchange
Notes for their own accounts, so long as the Prospectus otherwise meets the
requirements of the Securities Act.
In light of the foregoing, if requested by a Participating
Broker-Dealer, the Issuers agree (x) to use their best efforts to keep the
Exchange Registration Statement
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continuously effective for a period of up to six months after the Consummation
Date or such earlier date as each Participating Broker-Dealer shall have
notified the Company in writing that such Participating Broker-Dealer has resold
all Exchange Notes acquired in the Exchange Offer, (y) to comply with the
provisions of Section 5 of this Agreement, as they relate to the Exchange Offer
and the Exchange Registration Statement, and (z) to deliver to such
Participating Broker-Dealer a "cold comfort" letter of the independent public
accountants of the Issuers and a legal opinion as to matters reasonably
requested by such Participating Broker-Dealer relating to the Exchange
Registration Statement and the related Prospectus and any amendments or
supplements thereto.
(f) The Initial Purchasers shall have no liability to any
Participating Broker-Dealer with respect to any request made pursuant to Section
2(e).
(g) Interest on the Exchange Notes and the Private Exchange Notes
will accrue from the last interest payment date on which interest was paid on
the Notes surrendered in exchange therefor or, if no interest has been paid on
the Notes, from the date of the original issuance of the Notes.
(h) The Exchange Notes and the Private Exchange Notes may be
issued under (i) the Indenture or (ii) an indenture identical in all material
respects to the Indenture, which in either event shall provide that the Exchange
Notes shall not be subject to the transfer restrictions set forth in the
Indenture. The Indenture or such indenture shall provide that the Exchange
Notes, the Private Exchange Notes and the Notes shall vote and consent together
on all matters as one class and that neither the Exchange Notes, the Private
Exchange Notes nor the Notes will have the right to vote or consent as a
separate class on any matter.
3. SHELF REGISTRATION
(a) If (i) the Company is not permitted to file the Exchange Offer
Registration Statement or to consummate the Exchange Offer because the Exchange
Offer is not permitted by any applicable law or applicable interpretation of the
staff of the SEC or (ii) any holder of a Note notifies the Company on or prior
to the 30th day following the Issue Date that (a) due to a change in law or
policy it is not entitled to participate in the Exchange Offer, (b) due to a
change in law or policy it may not resell Exchange Notes acquired by it in the
Exchange Offer to the public without delivering a prospectus and the Prospectus
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contained in the Exchange Registration Statement is not appropriate or available
for such resales by such holder or (c) it owns Notes (including any Initial
Purchaser that holds Notes as part of an unsold allotment from the original
offering of the Notes) acquired directly from an Issuer or an Affiliate of an
Issuer or (iii) any holder of Private Exchange Notes so requests after the
consummation of the Private Exchange or (iv) the Company has not consummated the
Exchange Offer within 120 days after the Issue Date (each such event referred to
in clauses (i) through (iv), a "SHELF FILING EVENT"), the Issuers shall cause
to be filed with the SEC pursuant to Rule 415 a shelf registration statement
(the "SHELF REGISTRATION STATEMENT") prior to the later of (x) 60 days after
the Issue Date or (y) 30 days after the occurrence of such Shelf Filing Event,
relating to all Transfer Restricted Notes (the "SHELF REGISTRATION") the
holders of which have provided the information required pursuant to Section 3(b)
hereof (PROVIDED that if the Shelf Filing Event arises pursuant to clause (iv)
above, the Issuers shall file the Shelf Registration Statement on the 121st day
after the Issue Date), and shall use their best efforts to have the Shelf
Registration Statement declared effective by the SEC on or prior to 90 days
after the filing of such Shelf Filing Event. In such circumstances, the Issuers
shall use their best efforts to keep the Shelf Registration Statement
continuously effective under the Securities Act, until (a) 36 months following
the Issue Date or (b) if sooner, the date immediately following the date that
all Transfer Restricted Notes covered by the Shelf Registration Statement have
been sold pursuant thereto or otherwise cease to be Transfer Restricted Notes
(the "EFFECTIVENESS PERIOD"); PROVIDED that the Effectiveness Period shall
be extended to the extent required to permit dealers to comply with the
applicable prospectus delivery requirements of Rule 174.
(b) No holder of Transfer Restricted Notes may include any of its
Transfer Restricted Notes in any Shelf Registration Statement pursuant to this
Agreement unless and until such holder furnishes to the Company in writing,
within 30 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 Notes shall be entitled to Additional Interest pursuant
to Section 4 hereof unless and until such holder shall have provided all such
reasonably requested information. Each holder of Transfer Restricted Notes 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
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information previously furnished to the Company by such holder not materially
misleading.
4. ADDITIONAL INTEREST
(a) The parties hereto agree that the holders of Transfer
Restricted Notes will suffer damages if the Issuers fail to fulfill their
obligations pursuant to Section 2 or Section 3, as applicable, and that it would
not be feasible to ascertain the extent of such damages. Accordingly, in the
event that (i) the applicable Registration Statement is not filed with the SEC
on or prior to the date specified herein for such filing, (ii) the applicable
Registration Statement has not been declared effective by the SEC on or prior to
the date specified herein for such effectiveness after such obligation arises,
(iii) if the Exchange Offer is required to be Consummated hereunder, the Company
has not exchanged Exchange Notes for all Notes validly tendered and not validly
withdrawn in accordance with the terms of the Exchange Offer by the Consummation
Date or (iv) the applicable Registration Statement is filed and declared
effective but shall thereafter cease to be effective or usable in connection
with the Exchange Offer or resales of Transfer Restricted Notes during a period
in which it is required to be effective hereunder without being succeeded
immediately by any additional Registration Statement covering the Notes, the
Exchange Notes or the Private Exchange Notes, as the case may be, which has been
filed and declared effective (each such event referred to in clauses (i) through
(iv), a "REGISTRATION DEFAULT"), then the interest rate on Transfer Restricted
Notes will increase ("ADDITIONAL INTEREST"), with respect to the first 90-day
period immediately following the occurrence of such Registration Default, by
0.5% per annum and will increase by an additional 0.5% per annum with respect
to each subsequent 90-day period until such Registration Default has been cured,
up to a maximum amount of 1.0% per annum with respect to all Registration
Defaults. Following the cure of a Registration Default, the accrual of
Additional Interest with respect to such Registration Default will cease and
upon the cure of all Registration Defaults the interest rate will revert to the
original rate.
(b) The Company shall notify the Trustee and paying agent under
the Indenture (or the trustee and paying agent under such other indenture under
which any Transfer Restricted Notes are issued) immediately upon the happening
of each and every Registration Default. The Company shall pay the Additional
Interest due on the Transfer Restricted Notes by depositing with the paying
agent (which shall not be the Company for these
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purposes) for the Transfer Restricted Notes, in trust, for the benefit of the
holders thereof, prior to 11:00 A.M. on the next interest payment date specified
by the Indenture (or such other indenture), sums sufficient to pay the
Additional Interest then due. The Additional Interest due shall be payable on
each interest payment date specified by the Indenture (or such other indenture)
to the record holders entitled to receive the interest payment to be made on
such date. Each obligation to pay Additional Interest shall be deemed to accrue
from and including the applicable Registration Default.
(c) The parties hereto agree that the Additional Interest provided
for in this Section 4 constitutes a reasonable estimate of the damages that will
be suffered by holders of Transfer Restricted Notes by reason of the happening
of any Registration Default.
5. REGISTRATION PROCEDURES
In connection with the Issuers' registration obligations hereunder,
the Issuers shall effect such registrations on the appropriate form available
for the sale of the Notes, the Exchange Notes or Private Exchange Notes, as
applicable, to (i) in the case of the Exchange Offer, permit the exchange of
Exchange Notes for Notes in the Exchange Offer and, if applicable, resales of
Exchange Notes by Participating Broker-Dealers and (ii) in the case of a Shelf
Registration, permit the sale of the applicable Transfer Restricted Notes in
accordance with the method or methods of disposition thereof specified by the
holders of such Transfer Restricted Notes, and pursuant thereto the Issuers
shall as expeditiously as possible:
(a) In the case of a Shelf Registration, a reasonable period
of time prior to the initial filing of a Shelf Registration
Statement or Prospectus and a reasonable period of time prior to the
filing of any amendment or supplement thereto (including any
document that would be incorporated or deemed to be incorporated
therein by reference), furnish to the holders of the Transfer
Restricted Notes included in such Shelf Registration Statement,
their Special Counsel and the managing underwriters, if any, copies
of all such documents proposed to be filed, which documents (other
than those incorporated or deemed to be incorporated by reference)
will be subject to the review of such holders, their Special Counsel
and such underwriters, if any, and cause the officers and directors
of the
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Issuers, counsel to the Issuers and independent certified public
accountants to the Issuers to respond to such reasonable inquiries
as shall be necessary, in the opinion of respective counsel to such
holders and such underwriters, to conduct a reasonable investigation
within the meaning of the Securities Act; PROVIDED that the
foregoing inspection and information gathering shall be coordinated
on behalf of the Initial Purchasers by BT and on behalf of any other
persons, by one counsel designated by and on behalf of such other
persons; PROVIDED, HOWEVER, that the Issuers shall not be deemed
to have kept a Shelf Registration Statement effective during the
applicable period if any of them voluntarily takes any unreasonable
action or voluntarily fails to take any reasonable action that
results in holders of the Transfer Restricted Notes covered thereby
not being able to sell such Transfer Restricted Notes pursuant to
Federal securities laws during that period. The Issuers shall not
file any such Shelf Registration Statement or related Prospectus or
any amendments or supplements thereto which the holders of a
majority in principal amount of the Transfer Restricted Notes
included in such Shelf Registration Statement shall reasonably
object on a timely basis;
(b) Prepare and file with the SEC such amendments, including
post-effective amendments, to each Registration Statement as may be
necessary to keep such Registration Statement continuously effective
for the applicable time period required hereunder; cause the related
Prospectus to be supplemented by any required Prospectus
supplement, and as so supplemented to be filed pursuant to Rule 424;
and comply with the provisions of the Securities Act and the
Exchange Act with respect to the disposition of all securities
covered by such Registration Statement during such period in
accordance with the intended methods of disposition by the sellers
thereof set forth in such Registration Statement as so amended or in
such Prospectus as so supplemented;
(c) Notify the holders of Transfer Restricted Notes to be
sold or, in the case of an Exchange Offer, tendered for, their
Special Counsel and the managing underwriters, if any, promptly, and
(if requested by any such person), confirm such notice in writing,
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(i)(a) when a Prospectus or any Prospectus supplement or
post-effective amendment is proposed to be filed, and (b) with
respect to a Registration Statement or any post-effective amendment,
when the same has become effective, (ii) of any request by the SEC
or any other Federal or state governmental authority for amendments
or supplements to a Registration Statement or related Prospectus or
for additional information, (iii) of the issuance by the SEC, any
state securities commission, any other governmental agency or any
court of any stop order or injunction suspending or enjoining the
use of a Prospectus or the effectiveness of a Registration Statement
or the initiation of any proceedings for that purpose, (iv) of the
receipt by the Company of any notification with respect to the
suspension of the qualification or exemption from qualification of
any of the Notes, Exchange Notes or Private Exchange Notes for sale
in any jurisdiction, or the initiation or threatening of any
proceeding for such purpose, and (v) of the happening of any event
or information becoming known to any Issuer that makes any statement
made in a Registration Statement or related Prospectus or any
document incorporated or deemed to be incorporated therein by
reference untrue in any material respect or that requires the making
of any changes in such Registration Statement, Prospectus or
documents so that it will not contain any untrue statement of a
material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, not
misleading, and that in the case of a Prospectus, it will not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which
they were made, not misleading;
(d) Use their best efforts to avoid the issuance of or, if
issued, obtain the withdrawal of any order enjoining or suspending
the use of a Prospectus or the effectiveness of a Registration
Statement or the lifting of any suspension of the qualification (or
exemption from qualification) of any of the Notes, Exchange Notes or
Private Exchange Notes for sale in any jurisdiction, at the earliest
practicable moment;
(e) If a Shelf Registration Statement is filed pursuant to
Section 3 hereof and if requested by the
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managing underwriters, if any, or the holders of a majority in
aggregate principal amount of the Transfer Restricted Notes being
sold pursuant to such Shelf Registration Statement, (i) promptly
incorporate in a Prospectus supplement or post-effective amendment
such information as the managing underwriters, if any, and such
holders reasonably believe should be included therein, and (ii) make
all required filings of such Prospectus supplement or such
post-effective amendment under the Securities Act as soon as
practicable after the Company has received notification of the
matters to be incorporated in such Prospectus supplement or
post-effective amendment; PROVIDED, HOWEVER, that the Issuers
shall not be required to take any action pursuant to this Section
5(e) that would, in the opinion of counsel for the Issuers, violate
applicable law;
(f) Upon written request to the Company by a holder of
Notes, Exchange Notes or Private Exchange Notes to be exchanged or
sold pursuant to a Registration Statement, their Special Counsel and
each managing underwriter, if any, without charge, furnish at least
one conformed copy of such Registration Statement and each amendment
thereto, including financial statements and schedules, all documents
incorporated or deemed to be incorporated therein by reference, and
all exhibits to the extent requested (including those previously
furnished or incorporated by reference) as soon as practicable after
the filing of such documents with the SEC;
(g) Deliver to each holder of Notes, Exchange Notes or
Private Exchange Notes to be exchanged or sold pursuant to a
Registration Statement, their Special Counsel, and the
underwriters, if any, without charge, as many copies of the
Prospectus (including each form of prospectus) and each amendment or
supplement thereto as such persons reasonably request; and the
Issuers hereby consent to the use of such Prospectus and each
amendment or supplement thereto by each of the selling holders of
Transfer Restricted Notes and the underwriters, if any, in
connection with the offering and sale of the Transfer Restricted
Notes in accordance with the terms thereof and with U.S. Federal
securities laws and Blue Sky laws covered by such Prospectus and any
amendment or supplement thereto;
<PAGE>
-16-
(h) Prior to any public offering of Notes, Exchange Notes or
Private Exchange Notes, use their best efforts to register or
qualify or cooperate with the holders of Notes, Exchange Notes or
Private Exchange Notes to be sold or tendered for, the underwriters,
if any, and their respective counsel in connection with the
registration or qualification (or exemption from such registration
or qualification) of such Notes, Exchange Notes or Private Exchange
Notes for offer and sale under the securities or Blue Sky laws of
such jurisdictions within the United States as any such holder or
underwriter reasonably requests in writing; keep each such
registration or qualification (or exemption therefrom) effective
during the period such Registration Statement is required to be kept
effective hereunder and do any and all other acts or things
necessary or advisable to enable the disposition in such
jurisdictions of the Notes, Exchange Notes or Private Exchange Notes
covered by the applicable Registration Statement; PROVIDED,
HOWEVER, that the Issuers shall not be required to (i) qualify
generally to do business in any jurisdiction where they are not then
so qualified or (ii) take any action which would subject them to
general service of process or to taxation in any jurisdiction where
they are not so subject;
(i) In connection with any sale or transfer of Transfer
Restricted Notes that will result in such securities no longer being
Transfer Restricted Notes, cooperate with the holders thereof and
the managing underwriters, if any, to facilitate the timely
preparation and delivery of certificates representing Transfer
Restricted Notes to be sold, which certificates shall not bear any
restrictive legends and shall be in a form eligible for deposit with
The Depository Trust Company and to enable such Transfer Restricted
Notes to be in such denominations and registered in such names as
the managing underwriters, if any, or such holders may request at
least two Business Days prior to any sale of Transfer Restricted
Notes;
(j) Upon the occurrence of any event contemplated by Section
5(c)(v), as promptly as practicable, prepare a supplement or
amendment, including, if appropriate, a post-effective amendment, to
each Registration
<PAGE>
-17-
Statement or a supplement to the related Prospectus or any document
incorporated or deemed to be incorporated therein by reference, and
file any other required document so that, as thereafter delivered,
such Prospectus will not contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein
or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading;
(k) Prior to the effective date of the Exchange Registration
Statement, to provide a CUSIP number for the Exchange Notes (and
Private Exchange Notes, if applicable);
(l) If a Shelf Registration Statement is filed pursuant to
Section 3 hereof, enter into such agreements (including an
underwriting agreement in form, scope and substance as is customary
in underwritten offerings) and take all such other reasonable
actions in connection therewith (including those reasonably
requested by the managing underwriters, if any, or the holders of a
majority in aggregate principal amount of the Transfer Restricted
Notes being sold) in order to expedite or facilitate the disposition
of such Transfer Restricted Notes, and, whether or not an
underwriting agreement is entered into and whether or not the
registration is an underwritten registration, (i) make such
representations and warranties to the holders of such Transfer
Restricted Notes and the underwriters, if any, with respect to the
business of the Issuers and their subsidiaries (including with
respect to businesses or assets acquired or to be acquired by any of
them), and the Shelf Registration Statement, Prospectus and
documents, if any, incorporated or deemed to be incorporated by
reference therein, in each case, in form, substance and scope as are
customarily made by issuers to underwriters in underwritten
offerings, and confirm the same if and when customarily requested;
(ii) obtain opinions of counsel to the Issuers and updates thereof
(which counsel and opinions (in form, scope and substance) shall be
reasonably satisfactory to the managing underwriters, if any, and
Special Counsel to the holders of the Transfer Restricted Notes
being sold), addressed to each selling holder of Transfer Restricted
Notes and each of the underwriters,
<PAGE>
-18-
if any, covering the matters customarily covered in opinions
requested in underwritten offerings and such other matters as may be
reasonably requested by such Special Counsel and the managing
underwriters, in any; (iii) use their best efforts to obtain
customary "cold comfort" letters and updates thereof from the
independent certified public accountants of the Issuers (and, if
necessary, any other independent certified public accountants of any
subsidiary of the Issuers or of any business acquired by an Issuer
or any such subsidiary for which financial statements and financial
data is, or is required to be, included in the Shelf Registration
Statement), addressed (where reasonably possible) to each selling
holder of Transfer Restricted Notes and each of the underwriters, if
any, such letters to be in customary form and covering matters of
the type customarily covered in "cold comfort" letters in connection
with underwritten offerings; (iv) if an underwriting agreement is
entered into, the same shall contain indemnification provisions and
procedures no less favorable to the selling holders and the
underwriters, if any, than those set forth in Section 7 hereof (or
such other provisions and procedures acceptable to holders of a
majority in aggregate principal amount of Transfer Restricted Notes
covered by such Shelf Registration Statement and the managing
underwriters, if any); and (v) deliver such documents and
certificates as may be reasonably requested by the holders of a
majority in aggregate principal amount of the Transfer Restricted
Notes being sold, their Special Counsel and the managing
underwriters, if any, to evidence the continued validity of the
representations and warranties made pursuant to clause (i) above and
to evidence compliance with any customary conditions contained in
the underwriting agreement or other agreement entered into by the
Issuers;
(m) In the case of a Shelf Registration, make available for
inspection by a representative of the holders of Transfer Restricted
Notes being sold, any underwriter participating in any such
disposition of Transfer Restricted Notes, and any attorney,
consultant or accountant retained by such selling holders or
underwriter, at the offices where normally kept, during reasonable
business hours, all relevant financial and other records, pertinent
corporate documents and properties of the Issuers and their
subsidiaries
<PAGE>
-19-
(including with respect to businesses and assets acquired or to be
acquired to the extent that such information is available to the
Issuers), and cause the officers, directors, agents and employees of
the Issuers and their subsidiaries (including with respect to
businesses and assets acquired or to be acquired to the extent that
such information is available to the Issuers) to supply all
information in each case reasonably requested by any such
representative, underwriter, attorney, consultant or accountant in
connection with such Shelf Registration; PROVIDED, HOWEVER, that
such persons shall first agree in writing with the Company that any
information that is reasonably and in good faith designated by the
Company in writing as confidential at the time of delivery of such
information shall be kept confidential by such persons, unless and
to the extent that (i) disclosure of such information is required by
court or administrative order or is necessary to respond to
inquiries of regulatory authorities, (ii) disclosure of such
information is required by law (including any disclosure
requirements pursuant to Federal securities laws in connection with
the filing of the Shelf Registration Statement or the use of any
Prospectus), (iii) such information becomes generally available to
the public other than as a result of a disclosure or failure to
safeguard such information by such person or (iv) such information
becomes available to such person from a source other than the
Issuers and their subsidiaries and such source is not bound by a
confidentiality agreement; and PROVIDED, FURTHER, that the
foregoing inspection and information gathering shall be coordinated
on behalf of the Initial Purchasers by BT and on behalf of any other
persons, by one counsel designated by and on behalf of such other
persons;
(n) Provide an indenture trustee for the Notes and/or the
Exchange Notes and Private Exchange Notes, as the case may be, and
cause an indenture to be qualified under the TIA not later than the
effective date of the first Registration Statement relating to the
Notes and/or the Exchange Notes and Private Exchange Notes, as the
case may be; and if such indenture shall be the Indenture, in
connection therewith, cooperate with the Trustee and the holders of
the Notes and/or the Exchange Notes and Private
<PAGE>
-20-
Exchange Notes, to effect such changes to the Indenture, if any, as
may be required for the Indenture to be so qualified in accordance
with the terms of the TIA; and execute, and use its reasonable
efforts to cause the Trustee to execute, all customary documents as
may be required to effect such changes, and all other forms and
documents required to be filed with the SEC to enable the Indenture
to be so qualified in a timely manner;
(o) Comply with all applicable rules and regulations of the
SEC and make generally available to their securityholders earning
statements satisfying the provisions of Section 11(a) of the
Securities Act and Rule 158, no later than 45 days after the end of
any 12-month period (or 90 days after the end of any 12-month period
if such period is a fiscal year) (i) commencing at the end of any
fiscal quarter in which Transfer Restricted Notes are sold to
underwriters in a firm commitment or reasonable efforts underwritten
offering and (ii) if not sold to underwriters in such an offering,
commencing on the first day of the first fiscal quarter after the
effective date of a Registration Statement, which statement shall
cover said period, consistent with the requirements of Rule 158;
(p) Cooperate with each seller of Transfer Restricted Notes
covered by any Registration Statement and each underwriter, if any,
participating in the disposition of such Transfer Restricted Notes
and their respective counsel in connection with any filings required
to be made with the National Association of Securities Dealers,
Inc.; and
(q) Use their best efforts to take all other steps reasonably
necessary to effect the registration of the Transfer Restricted
Notes covered by a Registration Statement contemplated hereby.
The Issuers may require a holder of Transfer Restricted Notes to be
included in a Registration Statement to furnish to the Issuers such information
regarding the distribution of such Transfer Restricted Notes as is required by
law to be disclosed in such Registration Statement and the Issuers may exclude
from such Registration Statement the Transfer Restricted Notes of any
<PAGE>
-21-
holder who unreasonably fails to furnish such information within a reasonable
time after receiving such request.
If any such Registration Statement refers to any holder by name or
otherwise as the holder of any securities of an Issuer, then such holder shall
have the right to require (i) the insertion therein of language, in form and
substance reasonably satisfactory to such holder, 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 the Issuers' securities covered thereby
and that such holding does not imply that such holder will assist in meeting any
future financial requirements of the Issuers, or (ii) in the event that such
reference to such holder by name or otherwise is not required by the Securities
Act, the deletion of the reference to such holder in any amendment or supplement
to the Registration Statement filed or prepared subsequent to the time that such
reference ceases to be required.
In the case of a Shelf Registration pursuant to Section 3 hereof,
each holder of Transfer Restricted Notes agrees by acquisition of such Transfer
Restricted Notes that, upon receipt of any notice from the Company of the
happening of any event of the kind described in Section 5(c)(ii), 5(c)(iii),
5(c)(iv) or 5(c)(v) hereof, such holder will forthwith discontinue disposition
of such Transfer Restricted Notes covered by such Registration Statement or
Prospectus until such holder's receipt of the copies of the supplemented or
amended Prospectus contemplated by Section 5(j) hereof, or until it is advised
in writing by the Company that the use of the applicable Prospectus may be
resumed, and, in either case, has received copies of any additional or
supplemental filings that are incorporated or deemed to be incorporated by
reference in such Prospectus.
6. REGISTRATION EXPENSES
All fees and expenses incident to the performance of or compliance
with this Agreement by the Issuers shall be borne by the Issuers whether or not
any Registration Statement is filed or becomes effective and whether or not any
Notes, Exchange Notes or Private Exchange Notes are issued or sold pursuant to
any Registration Statement. The fees and expenses referred to in the foregoing
sentence shall include, without limitation, (i) all registration and filing fees
(including, without limitation, fees and expenses (a) with respect to filings
required to be made with the National Association of Securities Dealers, Inc.
and (b) in compliance with securities or Blue Sky laws), (ii) printing
<PAGE>
-22-
expenses (including, without limitation, expenses of printing certificates for
Notes, Exchange Notes and Private Exchange Notes in a form eligible for deposit
with The Depository Trust Company and of printing Prospectuses), (iii)
reasonable fees and disbursements of counsel for the Issuers and the Special
Counsel (not to exceed one firm of counsel), (iv) fees and disbursements of all
independent certified public accountants referred to in Section 2(e) and Section
5(l)(iii) hereof (including, without limitation, the expenses of any special
audit and "cold comfort" letters required by or incident to such performance),
(v) if required, the reasonable fees and expenses of any "qualified independent
underwriter" and its counsel as may be required by the rules and regulations of
the National Association of Securities Dealers, Inc., and (vi) fees and expenses
of all other persons retained by the Issuers. In addition, the Issuers shall
pay their internal expenses (including, without limitation, all salaries and
expenses of their respective officers and employees performing legal or
accounting duties), the expense of any annual audit, and the fees and expenses
incurred in connection with the listing of the Notes, Exchange Notes or Private
Exchange Notes to be registered on any securities exchange. Notwithstanding the
foregoing or anything in this Agreement to the contrary, each holder of Transfer
Restricted Notes shall pay all underwriting discounts and commissions of any
underwriters with respect to any Notes, Exchange Notes or Private Exchange Notes
sold by or on behalf of it.
7. INDEMNIFICATION
(a) The Issuers agree, jointly and severally, to indemnify and
hold harmless (i) each of the Initial Purchasers, each holder of Notes, Exchange
Notes and Private Exchange Notes and each Participating Broker-Dealer, (ii) each
person, if any, who controls (within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act) any of the foregoing (any of the persons
referred to in this clause (ii) being hereinafter referred to as a "controlling
person"), and (iii) the respective officers, directors, partners, employees,
representatives and agents of the Initial Purchasers, each holder of Notes,
Exchange Notes and Private Exchange Notes, each Participating Broker-Dealer and
any controlling person (any person referred to in clause (i), (ii) or (iii) may
hereinafter be referred to as an "INDEMNIFIED PERSON"), from and against any
and all losses, claims, damages, liabilities and judgments arising out of or
relating to any untrue statement or alleged untrue statement of a material fact
contained in any Registration Statement, Prospectus or preliminary prospectus or
in any amendment or supplement
<PAGE>
-23-
thereto, or arising out of or relating to any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein (in the case of any Prospectus or preliminary prospectus
or supplement thereto, in light of the circumstances under which they were made)
not misleading, except insofar as such losses, claims, damages, liabilities or
judgments are caused by any such untrue statement or omission or alleged untrue
statement or omission based upon information relating to any Indemnified Person
furnished in writing to the Issuers by or on behalf of such Indemnified Person
expressly for use therein; PROVIDED that the foregoing indemnity with respect
to any preliminary prospectus shall not inure to the benefit of any Indemnified
Person from whom the person asserting such losses, claims, damages, liabilities
and judgments purchased securities if such untrue statement or omission or
alleged untrue statement or omission made in such preliminary prospectus is
eliminated or remedied in the Prospectus and a copy of the Prospectus shall not
have been furnished to such person in a timely manner due to the wrongful action
or wrongful inaction of such Indemnified Person.
(b) In case any action shall be brought against any Indemnified
Person, based upon any Registration Statement or any such Prospectus or
preliminary prospectus or any amendment or supplement thereto and with respect
to which indemnity may be sought against the Issuers hereunder, such Indemnified
Person shall promptly notify the Issuers in writing and the Company shall assume
the defense thereof, including the employment of counsel reasonably satisfactory
to such Indemnified Person and payment of all fees and expenses. Any
Indemnified Person shall have the right to employ separate counsel in any such
action and participate in the defense thereof, but the fees and expenses of such
counsel shall be at the expense of such Indemnified Person, unless (i) the
employment of such counsel shall have been specifically authorized in writing by
the Issuers, (ii) the Company shall have failed to assume the defense and employ
counsel or pay all such fees and expenses or (iii) the named parties to any such
action (including any impleaded parties) include both such Indemnified Person
and an Issuer and such Indemnified Person shall have been advised by counsel
that there may be one or more legal defenses available to it which are different
from or additional to those available to any such Issuer (in which case the
Company shall not have the right to assume the defense of such action on behalf
of such Indemnified Person, it being understood, however, that the Issuers shall
not, in connection with any one such action or separate but substantially
similar or related actions in the same jurisdiction
<PAGE>
-24-
arising out of the same general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm of attorneys (in
addition to any local counsel) for all such Indemnified Persons, which firm
shall be designated in writing by such Indemnified Persons, and that all such
reasonable fees and expenses shall be reimbursed as they are incurred). The
Issuers shall not be liable for any settlement of any such action effected
without their written consent but if settled with the written consent of the
Issuers, the Issuers agree, jointly and severally, to indemnify and hold
harmless each Indemnified Person from and against any loss or liability by
reason of such settlement. No Issuer shall, without the prior written consent
of each Indemnified Person, effect any settlement of any pending or threatened
proceeding in respect of which any Indemnified Person is a party and indemnity
could have been sought hereunder by such Indemnified Person, unless such
settlement includes an unconditional release of such Indemnified Person from all
liability on claims that are the subject matter of such proceeding.
(c) In connection with any Registration Statement pursuant to
which a holder of Transfer Restricted Notes offers or sells Transfer Restricted
Notes, such holder agrees, severally and not jointly, to indemnify and hold
harmless the Issuers, their respective directors and officers and any person
controlling an Issuer within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act, to the same extent as the foregoing indemnity
from the Issuers to each Indemnified Person but only with respect to information
relating to such holder furnished in writing by or on behalf of such holder
expressly for use in such Registration Statement. In any such case in which any
action shall be brought against an Issuer, any director or officer of an Issuer
or any person controlling an Issuer based on such Registration Statement and in
respect of which indemnity may be sought against a holder of Transfer Restricted
Notes, such holder shall have the rights and duties given to the Issuers (except
that if an Issuer shall have assumed the defense thereof, such holder shall not
be required to do so, but may employ separate counsel therein and participate in
the defense thereof but the fees and expenses of such counsel shall be at the
expense of such holder), and the Issuers, their respective directors and
officers and any person controlling an Issuer shall have the rights and duties
given to the Indemnified Persons by Section 7(b) hereof.
(d) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party in respect of
<PAGE>
-25-
any losses, claims, damages, liabilities or judgments referred to herein, then
each indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities and judgments (i) in such
proportion as is appropriate to reflect the relative benefits received by each
indemnifying party on the one hand and the indemnified party on the other hand
from the offering of the Notes, the Exchange Notes or the Private Exchange
Notes, as the case may be (it being expressly understood and agreed that the
relative benefits received by the Issuers from the offering of the Notes,
Exchange Notes or Private Exchange Notes, as the case may be, shall be the
amount of the net proceeds received by the Company from the sale of the Notes to
the Initial Purchasers), or (ii) if the allocation provided by clause (i) above
is not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) above but also
the relative fault of each indemnifying party on the one hand and the
indemnified party on the other hand in connection with the statements or
omissions which resulted in such losses, claims, damages, liabilities or
judgments, as well as any other relevant equitable considerations. The relative
fault of the each indemnifying party on the one hand the indemnified party 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 to
state a material fact relates to information supplied by an indemnifying party
or such indemnified party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Issuers and the Initial Purchasers agree that it would not be
just and equitable if contribution pursuant to this Section 7(d) were determined
by PRO RATA allocation (even if all Indemnified Persons were treated as one
entity for such purpose) or by any other method of allocation which does not
take account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an indemnified party as a
result of the losses, claims, damages, liabilities or judgments referred to in
the immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred by
such indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 7, no
Indemnified Person shall be required to contribute any amount in excess of the
amount by which the net proceeds received by it in connection
<PAGE>
-26-
with the sale of the Notes, Exchange Notes or Private Exchange Notes
contemplated by this Agreement (or, in the case of an underwriter that is an
Indemnified Person, the total underwriting discounts received by such
underwriter) exceeds the amount of any damages which such Indemnified Person has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. No person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. The Indemnified Person's obligations to
contribute pursuant to this Section 7(d) are several in proportion to the
respective amount of Notes, Exchange Notes or Private Exchange Notes included in
any such Registration Statement by each Indemnified Person and not joint.
8. RULE 144A
Each of Issuers shall use its best efforts to file the reports
required to be filed by it under the Securities Act and the Exchange Act in a
timely manner and, if at any time it is not required to file such reports but in
the past had been required to or did file such reports, it will, upon the
request of any holder of Transfer Restricted Notes, make available other
information as required by, and so long as necessary to permit sales of Transfer
Restricted Notes pursuant to Rule 144A. Notwithstanding the foregoing, nothing
in this Section 8 shall be deemed to require an Issuer to register any of its
securities pursuant to the Exchange Act.
9. UNDERWRITTEN REGISTRATIONS
If any of the Transfer Restricted Notes covered by any Shelf
Registration are to be sold in an underwritten offering, the investment banker
or investment bankers and manager or managers that will administer the offering
will be selected by the holders of a majority in aggregate principal amount of
the Transfer Restricted Notes included in such offering, subject to the consent
of the Company (which will not be unreasonably withheld or delayed).
No person may participate in any underwritten registration hereunder
unless such person (i) agrees to sell such Transfer Restricted Notes on the
basis reasonably provided in any underwriting arrangements approved by the
persons entitled hereunder to approve such arrangements and (ii) completes and
executes all questionnaires, powers of attorney, indemnities,
<PAGE>
-27-
underwriting agreements and other documents required under the terms of such
underwriting arrangements.
10. MISCELLANEOUS
(a) REMEDIES. In the event of a breach by an Issuer or by a
holder of Notes, Exchange Notes or Private Exchange Notes of any of its
obligations under this Agreement, each holder of Notes, Exchange Notes or
Private Exchange Notes and each Issuer, in addition to being entitled to
exercise all rights granted by law, including recovery of damages, will be
entitled to specific performance of its rights under this Agreement.
Notwithstanding the provisions of Section 4 hereof, the Issuers and each holder
of Notes, Exchange Notes and Private Exchange Notes agree that monetary damages
would not be adequate compensation for any loss incurred by reason of a breach
of any of the provisions of this Agreement and each hereby further agrees that,
in the event of any action for specific performance in respect of such breach,
it shall waive the defense that a remedy at law would be adequate.
(b) NO INCONSISTENT AGREEMENTS. The Issuers will not enter into
any agreement with respect to their securities that is inconsistent with the
rights granted to the holders of Notes, Exchange Notes and Private Exchange
Notes and Indemnified Persons in this Agreement or otherwise conflicts with the
provisions hereof. Without the written consent of the holders of a majority in
aggregate principal amount of the outstanding Transfer Restricted Notes, the
Issuers shall not grant to any person any rights which conflict with or are
inconsistent with the provisions of this Agreement.
(c) NO PIGGYBACK ON REGISTRATIONS. The Issuers shall not grant
to any of their securityholders (other than the holders of Transfer Restricted
Notes in such capacity) the right to include any of their securities in any
Registration Statement other than Transfer Restricted Notes.
(d) AMENDMENTS AND WAIVERS. The provisions of this Agreement,
including the provisions of this sentence, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, otherwise than with the prior written consent of the holders
of not less than a majority of the then outstanding aggregate principal amount
of Transfer Restricted Notes; PROVIDED, HOWEVER, that, for the purposes of
this Agreement, Transfer Restricted Notes that are owned, directly or
indirectly, by the Issuers or any of their Affiliates are not deemed
outstanding. Notwithstanding the
<PAGE>
-28-
foregoing, a waiver or consent to depart from the provisions hereof with respect
to a matter that relates exclusively to the rights of holders of Transfer
Restricted Notes whose securities are being sold or tendered pursuant to a
Registration Statement and that does not directly or indirectly affect the
rights of other holders of Transfer Restricted Notes may be given by holders of
a majority in aggregate principal amount of the Transfer Restricted Notes being
sold or tendered by such holders pursuant to such Registration Statement;
PROVIDED, HOWEVER, that the provisions of this sentence may not be amended,
modified or supplemented except in accordance with the provisions of the
immediately preceding sentence. Notwithstanding the foregoing, no amendment,
modification, supplement, waiver or consent with respect to Section 7 shall be
made or given otherwise than with the prior written consent of each Indemnified
Person affected thereby.
(e) NOTICES. All notices and other communications provided for
herein shall be made in writing by hand-delivery, next-day air courier,
certified first-class mail, return receipt requested, telex or telecopier:
(i) if to the Issuers, as provided in the Purchase Agreement,
(ii) if to the Initial Purchasers, as provided in the Purchase
Agreement, or
(iii) if to any other person who is then the registered holder of
Notes, Exchange Notes or Private Exchange Notes, to the address of such
holder as it appears in the register therefor of the Company.
Except as otherwise provided in this Agreement, all such
communications shall be deemed to have been duly given: when delivered by hand,
if personally delivered; one Business Day after being timely delivered to a
next-day air courier; five Business Days after being deposited in the mail,
postage prepaid, if mailed; when answered back, if telexed; and when receipt is
acknowledged by the recipient's telecopier machine, if telecopied.
(f) SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and be binding upon the successors and permitted assigns of each of
the parties and shall inure to the benefit of each holder of Notes, Exchange
Notes and Private Exchange Notes and each Indemnified Person. The Issuers may
not
<PAGE>
-29-
assign any of their rights or obligations hereunder without the prior written
consent of each holder of Transfer Restricted Notes and each Indemnified Person.
Notwithstanding the foregoing, no successor or assignee of an Issuer shall have
any of the rights granted under this Agreement until such person shall
acknowledge its rights and obligations hereunder by a signed written statement
of such person's acceptance of such rights and obligations.
(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) GOVERNING LAW; SUBMISSION TO JURISDICTION. THIS AGREEMENT
SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW
YORK. THE ISSUERS HEREBY IRREVOCABLY SUBMIT TO THE JURISDICTION OF ANY NEW YORK
STATE COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK OR ANY
FEDERAL COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN
RESPECT OF ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT, AND EACH IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS
PROPERTY, GENERALLY AND UNCONDITIONALLY, JURISDICTION OF THE AFORESAID COURTS.
(i) SEVERABILITY. The remedies provided herein are cumulative
and not exclusive of any remedies provided by law. If any term, provision,
covenant or restriction of this Agreement is held by a court of competent
jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the
terms, provisions, covenants and restrictions set forth herein shall remain in
full force and effect and shall in no way be affected, impaired or invalidated,
and the parties hereto shall use their reasonable efforts to find and employ an
alternative means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction. It is hereby
stipulated and declared to be the intention of the parties that they would have
executed the remaining terms, provisions, covenants and restrictions without
including any of such that may be hereafter declared invalid, illegal, void or
unenforceable.
(j) HEADINGS. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof. All references made in this Agreement
<PAGE>
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to "Section" and "paragraph" refer to such Section or paragraph of this
Agreement, unless expressly stated otherwise.
(k) This Agreement is intended by the parties as a final
expression of their agreement and is 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 Issuers with respect to
the Notes, the Exchange Notes and the Private Exchange Notes. This Agreement
supersedes all prior agreements and understandings between the parties with
respect to such subject matter.
<PAGE>
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IN WITNESS WHEREOF, the parties have caused this Registration Rights
Agreement to be duly executed as of the date first written above.
THE COMPANY:
NATIONAL FIBERSTOK CORPORATION
By: /S/ ROBERT M. MIKLAS
------------------------------------
Name: ROBERT M. MIKLAS
Title: President & Chief Financial
Officer
THE GUARANTORS:
LABEL ART, INC.
By: /S/ JACK RESNICK
------------------------------------
Name: JACK RESNICK
Title: Vice President
INFOSEAL INTERNATIONAL, INC.
By: /S/ JACK RESNICK
------------------------------------
Name: JACK RESNICK
Title: Vice President
GOVERNMENT FORMS AND SYSTEMS,
INC.
By: /S/ JACK RESNICK
------------------------------------
Name: JACK RESNICK
Title: Vice President
PUTNAM GRAPHIC INNOVATIONS, INC.
By: /S/ JACK RESNICK
------------------------------------
Name: JACK RESNICK
Title: Vice President
<PAGE>
-32-
SHORT RUN LABELS, INC.
By: /S/ JACK RESNICK
------------------------------------
Name: JACK RESNICK
Title: Vice President
BOHARB CORPORATION
By: /S/ JACK RESNICK
------------------------------------
Name: JACK RESNICK
Title: Vice President
A/L SYSTEMS, INC.
By: /S/ JACK RESNICK
------------------------------------
Name: JACK RESNICK
Title: Vice President
THE INITIAL PURCHASERS:
BT SECURITIES CORPORATION
By: /S/ CHRISTINE VARBELLA-FOGGIA
-----------------------------------
Name: CHRISTINE VARBELLA-FOGGIA
Title: Vice President
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
By: /S/ JOSEPH ATENCIO
-----------------------------------
Name: JOSEPH ATENCIO
Title: Managing Director