Attached files
Exhibit
10.2
REGISTRATION
RIGHTS AGREEMENT
THIS
REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is made
as of November 30, 2009 by and among Charter Communications, Inc., a Delaware
corporation (the “Company”), and the
parties identified as “Investors” on the
signature page hereto and any parties identified on the signature page of any
joinder agreements executed and delivered pursuant to Section 11 hereof
(each, including the Investors, a “Holder” and,
collectively, the “Holders”).
Capitalized terms used but not otherwise defined herein are defined in Section 1
hereof.
RECITALS:
Whereas
the Company proposes to issue the New Common Stock (as defined below) pursuant
to, and upon the terms set forth in, the Plan of Reorganization of Charter
Communications, Inc., Charter Investment, Inc. and the direct and indirect
subsidiaries of Charter Communications, Inc. (the “Plan”) under chapter
11 of Title 11 of the United States Code. In accordance with the Plan, the
Company agrees for the benefit of the Holders, as follows:
NOW,
THEREFORE, in consideration of the premises and the mutual covenants contained
herein and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Company and each of the Holders hereby agree
as follows:
1. Definitions.
“Affiliate” of any
particular Person means any other Person directly or indirectly controlling,
controlled by or under common control with such Person.
“Agreement” has the
meaning specified in the first paragraph hereof.
“Automatic Shelf Registration
Statement” means an “automatic shelf registration statement” as defined
in Rule 405 promulgated under the Securities Act.
“Board” means the
board of directors of the Company.
“Business Day” means
any day other than a Saturday, Sunday or other day on which commercial banks in
New York City are authorized or required by applicable law or executive order to
close.
“Certification” has
the meaning specified in Section
13(p).
“Commission” means the
United States Securities and Exchange Commission or any successor governmental
agency.
“Company” has the
meaning specified in the first paragraph hereof.
“Company Notice” has
the meaning specified in Section
2(c).
“control” (including
the terms “controlling,” “controlled by” and “under common control with”) means,
unless otherwise noted, the possession, directly or indirectly, of the power to
direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting shares, by contract, or
otherwise.
“Counsel to the
Holders” means, with respect to any Shelf Takedown, the counsel selected
by the Holders of a majority of the Registrable Securities requested to be
included in such Shelf Takedown.
“Demand Notice” has
the meaning specified in Section
2(c).
“Determination Date”
has the meaning specified in Section
2(g).
“Disclosure Package”
means, with respect to any offering of securities, (i) the preliminary
prospectus, (ii) each Free Writing Prospectus and (iii) all other information,
in each case, that is deemed, under Rule 159 promulgated under the Securities
Act, to have been conveyed to purchasers of securities at the time of sale of
such securities (including a contract of sale).
“Effective Date” has
the meaning assigned to such term in the Plan.
“Exchange Act” means
the Securities Exchange Act of 1934, as amended from time to time.
“Exchange Agreement”
means that certain Exchange Agreement, dated as of the Effective Date, entered
into by and among the Company, Charter Communications Holding Company, LLC, Paul
G. Allen and Charter Investment, Inc., as amended from time to
time.
“Follow-On Registration
Notice” has the meaning specified in Section
2(h)(i).
“Follow-On Shelf” has
the meaning specified in Section
2(h)(i).
“Form S-1 Shelf” has
the meaning specified in Section
2(a).
“Form S-3 Shelf” has
the meaning specified in Section
2(a).
“Free Writing
Prospectus” means any “free writing prospectus” as defined in Rule 405
promulgated under the Securities Act.
“Hedging Counterparty”
means a broker-dealer registered under Section 15(b) of the Exchange Act or an
Affiliate thereof.
“Hedging Transaction”
means any transaction involving a security linked to the Registrable Securities
or any security that would be deemed to be a “derivative security” (as defined
in Rule 16a-1(c) promulgated under the Exchange Act) with respect to the
Registrable Securities or any transaction (even if not a security) which would
(were it a security) be
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considered
such a derivative security, or which transfers some or all of the economic risk
of ownership of the Registrable Securities, including any forward contract,
equity swap, put or call, put or call equivalent position, collar, non-recourse
loan, sale of an exchangeable security or similar transaction. For
the avoidance of doubt, the following transactions shall be deemed to be Hedging
Transactions:
(i) transactions
by a Holder in which a Hedging Counterparty engages in short sales of
Registrable Securities pursuant to a prospectus and may use Registrable
Securities to close out its short position;
(ii) transactions
pursuant to which a Holder sells short Registrable Securities pursuant to a
prospectus and delivers Registrable Securities to close out its short
position;
(iii) transactions
by a Holder in which the Holder delivers, in a transaction exempt from
registration under the Securities Act, Registrable Securities to the Hedging
Counterparty who will then publicly resell or otherwise transfer such
Registrable Securities pursuant to a prospectus or an exemption from
registration under the Securities Act; and
(iv) a
loan or pledge of Registrable Securities to a Hedging Counterparty who may then
become a selling stockholder and sell the loaned shares or, in an event of
default in the case of a pledge, sell the pledged shares, in each case, in a
public transaction pursuant to a prospectus.
“Holder” and “Holders” have the
meanings give to those terms in the first paragraph hereof.
“Holder Free Writing
Prospectus” means each Free Writing Prospectus prepared by or on behalf
of the relevant Holder or used or referred to by such Holder in connection with
the offering of Registrable Securities.
“Investors” has the
meaning specified in the first paragraph hereof.
“Lock-Up Period” has
the meaning specified in Section
4(a).
“Losses” has the
meaning specified in Section
8(d).
“FINRA” means the
Financial Industry Regulatory Authority.
“Membership Units”
means limited liability company interests in Charter Communications Holding
Company, LLC, a Delaware limited liability company or any successor entity
thereto, issued under a Limited Liability Company Agreement as amended from time
to time.
“NASDAQ” means the
National Association of Securities Dealers Automated Quotation
System.
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“New Common Stock”
means the shares of Class A Common Stock, par value $.001 per share, of the
Company issued on and after the Effective Date and any additional shares of such
common stock paid, issued or distributed in respect of any such shares by way of
a stock dividend, stock split or distribution, or in connection with a
combination of shares, and any such security into which such New Common Stock
shall have been converted or exchanged in connection with a recapitalization,
reorganization, reclassification, merger, consolidation, exchange, distribution
or otherwise.
“Other Holders” has
the meaning specified in Section
3(c).
“Person” means an
individual, a partnership, a corporation, a limited liability company, an
association, a joint stock company, a trust, a joint venture, an unincorporated
organization, a governmental entity or any department, agency or political
subdivision thereof or any other entity.
“Piggyback Takedown”
has the meaning specified in Section
3(a).
“Plan” has the meaning
specified in the Recitals.
“Prospectus” means the
prospectus used in connection with a Registration Statement.
“Registrable
Securities” means at any time any shares of New Common Stock (i) issued
on or after the Effective Date to any Holder or (ii) held or “beneficially
owned” (as such term is used in Rule 13d-3 and Rule 13d-5 promulgated under the
Exchange Act, except that in calculating the beneficial ownership of any Holder,
such Holder shall be deemed to have beneficial ownership of all securities that
such Holder has the right to acquire, whether such right is currently
exercisable or is exercisable only upon the occurrence of a subsequent
condition), by any Holder, including, without limitation, any New Common Stock
issued pursuant to the Plan or upon the conversion, exercise or exchange, as
applicable, of any other securities and/or interests issued pursuant to the
Plan, including, without limitation, shares of New Common Stock acquired in open
market or other purchases after the Effective Date, and shares of New Common
Stock issued or issuable upon (A) the conversion of shares of Class B Common
Stock, par value $.001 per share, of the Company, (B) the exchange of Membership
Units pursuant to the Exchange Agreement, and (C) the exercise of the Warrants;
provided, however, that as to
any Registrable Securities, such securities shall cease to constitute
Registrable Securities upon the earliest to occur of: (w) the date on which such
securities are disposed of pursuant to an effective registration statement under
the Securities Act; (x) the date on which such securities are disposed of
pursuant to Rule 144 (or any successor provision) promulgated under the
Securities Act; (y) with respect to the Registrable Securities of any Holder,
any time that such Holder no longer holds or “beneficially owns” (as defined
above) at least 1% of the outstanding New Common Stock; and (z) the date on
which such securities cease to be outstanding.
“Registration
Expenses” means all expenses (other than underwriting discounts and
commissions) arising from or incident to the registration of Registrable
Securities in compliance with this Agreement, including, without limitation, (i)
Commission, stock exchange, FINRA and other registration and filing fees, (ii)
all fees and expenses incurred in connection with complying with any securities
or blue sky laws (including, without limitation, fees, charges and
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disbursements
of counsel in connection with blue sky qualifications of the Registrable
Securities), (iii) all printing, messenger and delivery expenses, (iv) the fees,
charges and disbursements of counsel to the Company and of its independent
public accountants and any other accounting and legal fees, charges and expenses
incurred by the Company (including, without limitation, any expenses arising
from any special audits or “comfort letters” required in connection with or
incident to any registration), (v) the fees and expenses incurred in connection
with the listing of the Registrable Securities on NASDAQ (or any other national
securities exchange), (vi) the fees and expenses incurred in connection with any
road show for underwritten offerings reasonably expected to be in excess of $75
million in proceeds and (vii) fees, charges and disbursements of Counsel to the
Holders, including, for the avoidance of doubt, any expenses of Counsel to the
Holders in connection with the filing or amendment of any Registration
Statement, Prospectus or Free Writing Prospectus hereunder.
“Registration Notice”
has the meaning specified in Section
2(a).
“Registration
Statement” means any registration statement filed hereunder or in
connection with a Piggyback Takedown.
“Securities Act” means
the Securities Act of 1933, as amended from time to time.
“Selling Expenses”
means the underwriting fees, discounts, selling commissions and stock transfer
taxes applicable to all Registrable Securities registered by the Holders and
legal expenses not included within the definition of Registration
Expenses.
“Shelf” has the
meaning specified in Section
2(a).
“Shelf Registration”
means a registration of securities pursuant to a registration statement filed
with the Commission in accordance with and pursuant to Rule 415 promulgated
under the Securities Act (or any successor rule then in effect).
“Shelf Takedown” means
either an Underwritten Shelf Takedown or a Piggyback Takedown.
“Suspension Period”
has the meaning specified in Section
2(e)(ii).
“Underwritten Shelf
Takedown” has the meaning specified in Section
2(b).
“Warrants” has the
meaning specified in the Plan.
“Well-Known Seasoned
Issuer” means a “well-known seasoned issuer” as defined in Rule 405
promulgated under the Securities Act and which (i) is a “well-known seasoned
issuer” under paragraph (1)(i)(A) of such definition or (ii) is a “well-known
seasoned issuer” under paragraph (1)(i)(B) of such definition and is also
eligible to register a primary offering of its securities relying on General
Instruction I.B.1 of Form S-3 or Form F-3 under the Securities Act.
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2. Shelf
Registrations.
(a) Filing. The
Company shall use its commercially reasonable efforts to file, on or prior to
December 31, 2009, a Registration Statement for a Shelf Registration on Form S-1
covering the resale of the Registrable Securities on a delayed or continuous
basis (the “Form S-1
Shelf”). The Company shall use commercially reasonable efforts to cause
the registration statement to become effective by June 30, 2010. The
Company shall give written notice of the filing of the Registration Statement at
least twenty-five (25) days prior to filing the Registration Statement to all
Holders of Registrable Securities (the “Registration Notice”)
and shall include in such Registration Statement all Registrable Securities with
respect to which the Company has received written requests for inclusion therein
within twenty (20) days after sending the Registration Notice. The Company shall
maintain the Shelf in accordance with the terms hereof. The Company
shall use its commercially reasonable efforts to convert the Form S-1 Shelf (and
any Follow-On Shelf) to a Registration Statement for a Shelf Registration on
Form S-3 (the “Form
S-3 Shelf”, and together with the Form S-1 Shelf (and any Follow-On
Shelf), the “Shelf”) as soon as
practicable after the Company is eligible to use Form S-3.
(b) Requests
for Underwritten Shelf Takedowns. At
any time and from time to time after the Shelf has been declared effective by
the Commission, any one or more Holders of Registrable Securities may request to
sell all or any portion of their Registrable Securities in an underwritten
offering that is registered pursuant to the Shelf (each, an “Underwritten Shelf
Takedown”); provided that in the
case of each such Underwritten Shelf Takedown such Holder or Holders will be
entitled to make such demand only if the total offering price of the shares to
be sold in such offering (including piggyback shares and before deduction of
underwriting discounts) is reasonably expected to exceed, in the aggregate, $25
million.
(c) Demand
Notices. All
requests for Underwritten Shelf Takedowns shall be made by giving written notice
to the Company (the “Demand Notice”). Each
Demand Notice shall specify the approximate number of Registrable Securities to
be sold in the Underwritten Shelf Takedown and the expected price range (net of
underwriting discounts and commissions) of such Underwritten Shelf
Takedown. Within five (5) days after receipt of any Demand Notice,
the Company shall give written notice of such requested Underwritten Shelf
Takedown to all other Holders of Registrable Securities (the “Company Notice”) and,
subject to the provisions of Section 2(d)
below, shall include in such Underwritten Shelf Takedown all Registrable
Securities with respect to which the Company has received written requests for
inclusion therein within 20 days after sending the Company Notice.
(d) Priority
on Underwritten Shelf Takedowns. The
Company shall not include in any Underwritten Shelf Takedown any securities
which are not Registrable Securities without the prior written consent of the
Holders of a majority of the Registrable Securities requested to be included in
the Underwritten Shelf Takedown. If the managing underwriters for such
Underwritten Shelf Takedown advise the Company in writing that in their opinion
the number of Registrable Securities and, if permitted hereunder, other
securities requested to be included in such Underwritten Shelf Takedown exceeds
the number of Registrable Securities and other securities, if any, which can be
sold in an orderly manner in such offering within a price range acceptable to
the Holders of a majority of the Registrable Securities requested to be included
in the Underwritten Shelf
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Takedown,
the Company shall include in such Underwritten Shelf Takedown the number of
Registrable Securities which can be so sold in the following order of priority:
(i) first,
the Registrable Securities requested to be included in such Underwritten Shelf
Takedown, which in the opinion of such underwriter can be sold in an orderly
manner within the price range of such offering, pro rata among the respective
Holders of such Registrable Securities on the basis of the number of Registrable
Securities requested to be included therein by each such Holder, and
(ii) second, other
securities requested to be included in such Underwritten Shelf Takedown to the
extent permitted hereunder.
(e) Restrictions
on Underwritten Shelf Takedowns and Use of Registration Statement.
(i) The
Company shall not be obligated to effect more than three Underwritten Shelf
Takedowns during any period of 12 consecutive months and shall not be obligated
to effect an Underwritten Shelf Takedown within 100 days after the pricing of a
previous Underwritten Shelf Takedown.
(ii) Upon
written notice to the Holders of Registrable Securities, the Company shall be
entitled to suspend, for a period of time (each, a “Suspension Period”),
the use of any Registration Statement or Prospectus and shall not be required to
amend or supplement the Registration Statement, any related Prospectus or any
document incorporated therein by reference if the Company determines in its
reasonable good faith judgment, after consultation with counsel, that the
Registration Statement or any Prospectus may contain an untrue statement of a
material fact or omits any fact necessary to make the statements in the
Registration Statement or Prospectus not misleading; provided that (A)
there are no more than five (5) Suspension Periods in any 12-month period, (B)
the duration of all Suspension Periods may not exceed 120 days in the aggregate
in any 12-month period, and (C) the Company shall use its good faith efforts to
amend the Registration Statement and/or Prospectus to correct such untrue
statement or omission as soon as reasonably practicable unless such amendment
would reasonably be expected to have a material adverse effect on any proposal
or plan of the Company to effect a merger, acquisition, disposition, financing,
reorganization, recapitalization or similar transaction, in each case that is
material to the Company.
(f) Selection
of Underwriters. The
Holders of a majority of the Registrable Securities requested to be included in
an Underwritten Shelf Takedown shall have the right to select the investment
banker(s) and manager(s) to administer the offering (which shall consist of one
(1) or more reputable nationally recognized investment banks), subject to the
Company’s approval which shall not be unreasonably withheld, conditioned or
delayed.
(g) Automatic Shelf
Registration. Upon
the Company becoming a Well-Known Seasoned Issuer, (i) the Company shall give
written notice to all of the Holders as promptly as practicable but in no event
later than twenty (20) Business Days thereafter, and such notice shall describe,
in reasonable detail, the basis on which the Company has become a Well-Known
Seasoned Issuer, and (ii) the Company shall, as promptly as practicable,
register, under an Automatic Shelf Registration Statement, the sale of all of
the Registrable Securities in accordance with the terms of this
Agreement. The Company shall use its commercially reasonable efforts
to file such Automatic Shelf Registration Statement as promptly as practicable,
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but in no event later than thirty (30) Business Days after it becomes a Well-Known Seasoned Issuer, and to cause such Automatic Shelf Registration Statement to remain effective thereafter until there are no longer any Registrable Securities. The Company shall give written notice of filing such Registration Statement to all of the Holders as promptly as practicable thereafter. At any time after the filing of an Automatic Shelf Registration Statement by the Company, if the Company is no longer a Well-Known Seasoned Issuer (the “Determination Date”), within twenty (20) days after such Determination Date, the Company shall (A) give written notice thereof to all of the Holders and (B) file a Registration Statement on an appropriate form (or a post effective amendment converting the Automatic Shelf Registration Statement to an appropriate form) covering all of the Registrable Securities, and use commercially reasonable efforts to have such Registration Statement declared effective as promptly as practicable (but in no event more than 30 days) after the date the Automatic Shelf Registration Statement is no longer useable by the Holders to sell their Registrable Securities.
(h) Additional
Selling Stockholders and Additional Registrable Securities.
(i) If the
Company is not a Well-Known Seasoned Issuer, within 30 days after a written
request by one or more Holders of Registrable Securities to register for resale
any additional Registrable Securities owned by such Holders, the Company shall
file a Registration Statement substantially similar to the Shelf then effective,
if any (each, a “Follow-On Shelf”), to
register for resale such Registrable Securities. The Company shall
give written notice of the filing of the Follow-On Shelf at least 25 days prior
to filing the Follow-On Shelf to all Holders of Registrable Securities (the
“Follow-On
Registration Notice”) and shall include in such Follow-On Shelf all
Registrable Securities with respect to which the Company has received written
requests for inclusion therein within twenty (20) days after sending the
Follow-On Registration Notice. Notwithstanding the foregoing, the
Company shall not be required to file a Follow-On Shelf (x) if the aggregate
amount of Registrable Securities requested to be registered on such Follow-On
Shelf by all Holders that have not yet been registered represent less than 1% of
the then outstanding New Common Stock or (y) if the Company is not then eligible
for use of Form S-3 for secondary offerings and the Company has filed a
Follow-On Shelf in the prior 180 days. The Company shall use
commercially reasonable efforts to cause such Follow-On Shelf to be declared
effective as promptly as practicable and in any event within ninety (90) days of
filing such Follow-On Shelf. Any Registrable Securities requested to
be registered pursuant to this Section 2(h)(i) that
have not been registered on a Shelf or pursuant to Section 3 below at
the time the Follow-On Shelf is filed shall be registered pursuant to such
Follow-On Shelf.
(ii) If the
Company is a Well-Known Seasoned Issuer, within twenty (20) Business Days after
a written request by one or more Holders of Registrable Securities to register
for resale any additional Registrable Securities owned by such Holders, the
Company shall make all necessary filings to include such Registrable Securities
in the Automatic Shelf Registration Statement filed pursuant to Section
2(g).
(iii) If a Form
S-3 Shelf or Automatic Shelf Registration Statement is effective, within five
(5) Business Days after written request therefor by a Holder of Registrable
Securities, the Company shall file a prospectus supplement or current report on
Form 8-K
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to
add such Holder as a selling stockholder in such Form S-3 Shelf or Automatic
Shelf Registration Statement to the extent permitted under the rules and
regulations promulgated by the Commission.
(i) Other
Registration Rights. Except
as expressly contemplated by the Plan, the Company represents and warrants that
it is not a party to, or otherwise subject to, any other agreement granting
registration rights to any other Person with respect to any securities of the
Company.
3. Piggyback
Takedowns.
(a) Right to
Piggyback. Whenever
the Company proposes to register any of its securities, or proposes to offer any
of its New Common Stock pursuant to a registration statement in an underwritten
offering of New Common Stock under the Securities Act (a “Piggyback Takedown”),
the Company shall give prompt written notice to all Holders of Registrable
Securities of its intention to effect such Piggyback Takedown. In the
case of a Piggyback Takedown that is an underwritten offering under a shelf
registration statement, such notice shall be given not less than five (5)
Business Days prior to the expected date of commencement of marketing efforts
for such Piggyback Takedown. In the case of a Piggyback Takedown that
is an underwritten offering under a registration statement that is not a shelf
registration statement, such notice shall be given not less than five (5)
Business Days prior to the expected date of filing of such registration
statement. The Company shall, subject to the provisions of Sections 3(b) and
(c) below,
include in such Piggyback Takedown, as applicable, all Registrable Securities
with respect to which the Company has received written requests for inclusion
therein within five (5) days after sending the Company’s
notice. Notwithstanding anything to the contrary contained herein,
the Company may determine not to proceed with any Piggyback Takedown
upon written notice to the Holders of Registrable Securities requesting to
include their Registrable Securities in such Piggyback Takedown.
(b) Priority
on Primary Piggyback Takedowns. If a Piggyback Takedown is an
underwritten primary registration on behalf of the Company, and the managing
underwriters for a Piggyback Takedown advise the Company in writing that in
their reasonable opinion the number of securities requested to be included in
such Piggyback Takedown exceeds the number which can be sold in an orderly
manner in such offering within a price range acceptable to the Company, the
Company shall include in such Piggyback Takedown the number which can be so
sold in
the following order of priority: (i) first, the securities
the Company proposes to sell, (ii) second, the
Registrable Securities requested to be included in such Piggyback Takedown (pro
rata among the Holders of such Registrable Securities on the basis of the number
of Registrable Securities requested to be included therein by each such Holder),
and (iii) third, other
securities requested to be included in such Piggyback
Takedown.
(c) Priority
on Secondary Piggyback Takedowns. If
a Piggyback Takedown is an underwritten secondary registration on behalf of
holders of the Company’s securities (“Other Holders”), and
the managing underwriters advise the Company in writing that in their opinion
the number of securities requested to be included in such Piggyback Takedown
exceeds the number which can be sold in an orderly manner in such offering
within a price range acceptable to the Other Holders, the Company shall include
in such registration the number which can be so
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sold in
the following order of priority: (i) first, the securities
requested to be included therein by the Other Holders requesting such
registration and the Registrable Securities requested to be included in such
registration, pro rata among the holders of any such securities and Registrable
Securities on the basis of the number of securities and Registrable Securities
so requested to be included therein by each such holder, and (ii) second, other
securities requested to be included in such registration.
(d) Selection
of Underwriters. If any
Piggyback Takedown is an underwritten offering, the Company will have the sole
right to select the investment banker(s) and manager(s) for the
offering.
4. Holdback
Agreements.
(a) Holders
of Registrable Securities. In connection with any Shelf Takedown or
other underwritten public offering of equity securities by the Company, no
Holder who “beneficially owns” (as such term is defined under and determined
pursuant to Rule 13d-3 promulgated under the Exchange Act) five percent (5%) or
more of the outstanding shares of New Common Stock shall effect any public sale
or distribution (including sales pursuant to Rule 144) of equity securities of
the Company, or any securities convertible into or exchangeable or exercisable
for such securities, without prior written consent from the Company, during the
seven (7) days prior to and the 90-day period beginning on the date of pricing
of such Shelf Takedown (the “Lock-Up Period”),
except as part of the Shelf Takedown, and (i) unless the underwriters managing
the Shelf Takedown or other underwritten public equity offering by the Company
otherwise agree by written consent and (ii) only if such Lock-Up Period is
applicable on substantially similar terms to the Company and the executive
officers and directors of the Company; provided that nothing
herein will prevent any Holder that is a partnership or corporation from making
a distribution of Registrable Securities to the partners or stockholders thereof
or a transfer to an Affiliate that is otherwise in compliance with the
applicable securities laws, so long as such distributees or transferees agree to
be bound by the restrictions set forth in this Section 4(a). Each
Holder agrees to execute a lock-up agreement in favor of the Company’s
underwriters to such effect and, in any event, that the Company’s underwriters
in any relevant Shelf Takedown shall be third party beneficiaries of this
Section 4(a). The provisions of this Section
4(a) will no longer apply to a Holder once such Holder ceases to hold
Registrable Securities.
(b) The
Company. In connection with any Shelf Takedown, the Company shall not
effect any public sale or distribution of its equity securities, or any
securities convertible into or exchangeable or exercisable for such securities
(except pursuant to registrations on Form S-8 or Form S-4 under the Securities
Act), during the seven (7) days prior to and the 90-day period beginning on the
date of pricing of such Shelf Takedown.
5. Company
Undertakings. Whenever
Registrable Securities are registered pursuant to this Agreement, the Company
shall use its commercially reasonable efforts to effect the registration and the
sale of such Registrable Securities as soon as reasonably practicable in
accordance with the intended method of disposition thereof, and pursuant thereto
the Company shall as expeditiously as possible:
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(a) before
filing a Registration Statement or Prospectus or any amendments or supplements
thereto, at the Company’s expense, furnish to the Holders whose securities are
covered by the Registration Statement copies of all such documents, other than
documents that are incorporated by reference, proposed to be filed and such
other documents reasonably requested by such Holders, which documents shall be
subject to the review and comment of the counsel to such
Holders;
(b) notify
each Holder of Registrable Securities of the effectiveness of each Registration
Statement and prepare and file with the Commission such amendments and
supplements to such Registration Statement and the Prospectus used in connection
therewith as may be necessary to keep such Registration Statement effective for
a period ending on the date on which all Registrable Securities have been sold
under the Registration Statement applicable to such Shelf Registration or have
otherwise ceased to be Registrable Securities, and comply with the provisions of
the Securities 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;
(c) furnish
to each seller of Registrable Securities, and the managing underwriters, without
charge, such number of copies of the applicable Registration Statement, each
amendment and supplement thereto, the Prospectus included in such Registration
Statement (including each preliminary Prospectus, final Prospectus, and any
other Prospectus (including any Prospectus filed under Rule 424, Rule 430A or
Rule 430B promulgated under the Securities Act and any “issuer free writing
prospectus” as such term is defined under Rule 433 promulgated under the
Securities Act)), all exhibits and other documents filed therewith and such
other documents as such seller or such managing underwriters may reasonably
request including in order to facilitate the disposition of the Registrable
Securities owned by such seller, and upon request, a copy of any and all
transmittal letters or other correspondence to or received from, the Commission
or any other governmental authority relating to such offer;
(d) use its
commercially reasonable efforts (i) to register or qualify such Registrable
Securities under such other securities or blue sky laws of such jurisdictions as
any seller reasonably requests, (ii) to keep such registration or qualification
in effect for so long as such Registration Statement remains in effect, and
(iii) to do any and all other acts and things which may be reasonably necessary
or advisable to enable such seller to consummate the disposition in such
jurisdictions of the Registrable Securities owned by such seller (provided that
the Company shall not be required to (i) qualify generally to do business in any
jurisdiction where it would not otherwise be required to qualify but for this
subsection, (ii) subject itself to taxation in any such jurisdiction or (iii)
consent to general service of process in any such jurisdiction);
(e) notify
each seller of such Registrable Securities, Counsel to the Holders and the
managing underwriters (i) at any time when a Prospectus relating to the
applicable Registration Statement is required to be delivered under the
Securities Act, (A) upon discovery that, or upon the happening of any event as a
result of which, such Registration Statement, or the Prospectus or Free Writing
Prospectus relating to such Registration Statement, or any document incorporated
or deemed to be incorporated therein by reference contains an untrue statement
of a material fact or omits any fact necessary to make the statements in the
Registration Statement or the Prospectus or Free Writing Prospectus relating
thereto not misleading or otherwise requires
11
the
making of any changes in such Registration Statement, Prospectus, Free Writing
Prospectus or document, and, at the request of any such seller and subject to
Section 2(e)(ii) hereof, the Company shall promptly prepare a supplement or
amendment to such Prospectus or Free Writing Prospectus, furnish a reasonable
number of copies of such supplement or amendment to each seller of such
Registrable Securities, Counsel to the Holders and the managing underwriters and
file such supplement or amendment with the Commission so that, as thereafter
delivered to the purchasers of such Registrable Securities, such Prospectus or
Free Writing Prospectus as so amended or supplemented shall not contain an
untrue statement of a material fact or omit to state any fact necessary to make
the statements therein not misleading, (B) as soon as the Company becomes aware
of any request by the Commission or any Federal or state governmental authority
for amendments or supplements to a Registration Statement or related Prospectus
or Free Writing Prospectus covering Registrable Securities or for additional
information relating thereto, (C) as soon as the Company becomes aware of the
issuance or threatened issuance by the Commission of any stop order suspending
or threatening to suspend the effectiveness of a Registration Statement covering
the Registrable Securities or (D) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of any Registrable Security for sale in any jurisdiction, or
the initiation or threatening of any proceeding for such purpose; and (ii) when
each Registration Statement or any amendment thereto has been filed with the
Commission and when each Registration Statement or the related Prospectus or
Free Writing Prospectus or any Prospectus supplement or any post effective
amendment thereto has become effective.
(f) use its
commercially reasonable efforts to cause all such Registrable Securities (i) if
the New Common Stock is then listed on a securities exchange or included for
quotation in a recognized trading market, to continue to be so listed or
included, (ii) if the New Common Stock is not then listed on a securities
exchange or included for quotation in a recognized trading market, to, as
promptly as practicable (subject to the limitations set forth in the Plan), and
in no event later than the effective date of the Form S-1 Shelf filed pursuant
to Section 2(a), be listed on NASDAQ or another national securities exchange,
and (iii) to be registered with or approved by such
other governmental agencies or authorities as may be necessary to enable the
sellers thereof to consummate the disposition of the Registrable
Securities;
(g) provide
and cause to be maintained a transfer agent and registrar for all such
Registrable Securities from and after the effective date of the applicable
Registration Statement;
(h) enter
into and perform under such customary agreements (including underwriting
agreements in customary form, including customary representations and warranties
and provisions with respect to indemnification and contribution) and take all
such other actions as the Holders of a majority of the Registrable Securities
included in such Shelf Takedown or the underwriters, if any, reasonably request
in order to expedite or facilitate the disposition of such Registrable
Securities (including effecting a stock split, a combination of shares, or other
recapitalization) and provide reasonable cooperation, including causing
appropriate officers to attend and participate in “road shows” and other
information meetings organized by the underwriters, if any; provided, that the
Company shall have no obligation to participate in “road shows” in connection
with any Underwritten Shelf Takedown in which the total offering price of the
Registrable Securities to be sold therein is less than $75,000,000; provided,
further, that the
12
Company
shall have no obligation to participate in more than two “road shows” in any
twelve-month period;
(i) for a
reasonable period prior to the filing of any Registration Statement or the
commencement of marketing efforts for a Shelf Takedown, as applicable, pursuant
to this Agreement, make available for inspection and copying by any Holder of
Registrable Securities, Counsel to the Holders, any underwriter participating in
any disposition pursuant to such Registration Statement or Shelf Takedown, as
applicable, and any other attorney, accountant or other agent retained by any
such Holder or underwriter, all financial and other records and pertinent
corporate documents of the Company, and cause the Company’s officers, directors,
employees and independent accountants to supply all information and participate
in any due diligence sessions reasonably requested by any such Holder,
underwriter, attorney, accountant or agent in connection with such Registration
Statement or Shelf Takedown, as applicable, provided that recipients of such
financial and other records and pertinent corporate documents agree in writing
to keep the confidentiality thereof pursuant to a written agreement reasonably
acceptable to the Company and the applicable underwriter (which shall contain
customary exceptions thereto);
(j) permit
any Holder of Registrable Securities, Counsel to the Holders, any underwriter
participating in any disposition pursuant to a Registration Statement, and any
other attorney, accountant or other agent retained by such Holder of Registrable
Securities or underwriter, to participate (including, but not limited to,
reviewing, commenting on and attending all meetings) in the preparation of such
Registration Statement and any Prospectus supplements relating to a Shelf
Takedown, if applicable;
(k) in the
event of the issuance or threatened issuance of any stop order suspending the
effectiveness of a Registration Statement, or of any order suspending or
preventing the use of any related Prospectus or suspending the qualification of
any New Common Stock included in such Registration Statement for sale in any
jurisdiction, the Company shall use its commercially reasonable efforts promptly
to (i) prevent the issuance of any such stop order, and in the event of
such
issuance, to obtain the withdrawal of such order and (ii) obtain the withdrawal
of any order suspending or preventing the use of any related Prospectus or Free
Writing Prospectus or suspending qualification of any Registrable Securities
included in such Registration Statement for sale in any jurisdiction at the
earliest practicable date;
(l) in
connection with any Shelf Takedown, obtain and furnish to each such Holder of
Registrable Securities including Registrable Securities in such Shelf Takedown a
signed counterpart of (i) a cold comfort letter from the Company’s independent
public accountants and (ii) a legal opinion of counsel to the Company addressed
to the relevant underwriters and/or such Holders of Registrable Securities, in
each case in customary form and covering such matters of the type customarily
covered by such letters as the managing underwriters and/or Holders of a
majority of the Registrable Securities included in such Shelf Takedown
reasonably request;
(m) with
respect to each Free Writing Prospectus or other materials to be included in the
Disclosure Package, ensure that no Registrable Securities be sold “by means of”
(as defined in Rule 159A(b) promulgated under the Securities Act) such Free
Writing Prospectus or other materials without the prior written consent of a
majority of the Holders of the Registrable
13
Securities
that are being sold pursuant to such Free Writing Prospectus, which Free Writing
Prospectuses or other materials shall be subject to the review of Counsel to the
Holders; provided, however, the Company shall not be responsible or liable for
any breach by a Holder that has not obtained the prior written consent of the
Company pursuant to Section 13(q);
(n) provide a
CUSIP number for the Registrable Securities prior to the effective date of the
first Registration Statement including Registrable Securities;
(o) promptly
notify in writing the Holders, the sales or placement agent, if any, therefor
and the managing underwriters of the securities being sold, (i) when such
Registration Statement or related Prospectus or Free Writing Prospectus or any
Prospectus amendment or supplement or post effective amendment has been filed,
and, with respect to any such Registration Statement or any post effective
amendment, when the same has become effective and (ii) of any written
comments by the Commission and by the blue sky or securities commissioner or
regulator of any state with respect thereto;
(p) (i)
prepare and file with the Commission such amendments and supplements to each
Registration Statement as may be necessary to comply with the provisions of the
Securities Act, 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 and if applicable,
file any Registration Statements pursuant to Rule 462(b) promulgated under the
Securities Act; (ii) cause the related Prospectus to be supplemented by any
required Prospectus supplement, and as so supplemented to be filed pursuant to
Rule 424 (or any similar provisions then in force) promulgated under the
Securities Act; (iii) comply with the provisions of the Securities Act and the
Exchange Act and any applicable securities exchange or other recognized trading
market 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; and (iv)
provide additional information related to eachRegistration
Statement as requested by, and obtain any required approval necessary from, the
Commission or any Federal or state governmental authority.
(q) cooperate
with each Holder of Registrable Securities and each underwriter participating in
the disposition of such Registrable Securities and underwriters’ counsel in
connection with any filings required to be made with FINRA;
(r) within
the deadlines specified by the Securities Act, make all required filing fee
payments in respect of any Registration Statement or Prospectus used under this
Agreement (and any offering covered thereby);
(s) if
requested by any participating Holder of Registrable Securities or the managing
underwriters, promptly include in a Prospectus supplement or amendment such
information as the Holder or managing underwriters may reasonably request,
including in order to permit the intended method of distribution of such
securities, and make all required filings of such Prospectus supplement or such
amendment as soon as reasonably practicable after the Company has received such
request;
14
(t) in the
case of certificated Registrable Securities, cooperate with the participating
Holders of Registrable Securities and the managing underwriters to facilitate
the timely preparation and delivery of certificates (not bearing any legends)
representing Registrable Securities to be sold after receiving written
representations from each participating Holder that the Registrable Securities
represented by the certificates so delivered by such Holder will be transferred
in accordance with the Registration Statement, and enable such Registrable
Securities to be in such denominations and registered in such names as the
Holders or managing underwriters may reasonably request at least two (2)
Business Days prior to any sale of Registrable Securities; and use its
commercially reasonable efforts to take all other actions necessary to effect
the registration and sale of the Registrable Securities contemplated
hereby.
(u) use its
commercially reasonable efforts to take all other actions necessary to effect
the registration and sale of the Registrable Securities contemplated
hereby.
6. Registration
Expenses. All
Registration Expenses shall be borne by the Company. All Selling
Expenses relating to Registrable Securities registered shall be borne by the
Holders of such Registrable Securities pro rata on the basis of the number of
Registrable Securities sold.
7. Hedging
Transactions.
(a) The
Company agrees that, in connection with any proposed Hedging Transaction, if, in
the reasonable judgment of Counsel to the Holders, it is necessary or desirable
to have a Registration Statement under the Securities Act cover such Hedging
Transaction or sales or transfers (whether short or long) of Registrable
Securities in connection therewith, then the Company shall use its commercially
reasonable efforts to take such actions (which may include the filing of a
prospectus supplement to include additional or changed information that is
material or is otherwise required to be disclosed, including a description of
such Hedging Transaction, the name of the Hedging Counterparty, identification
of the Hedging Counterparty or its
Affiliates as underwriters or potential underwriters, if applicable, or any
change to the plan of distribution, but shall not include the filing of a
post-effective amendment to a Registration Statement) as may reasonably be
required to have such Hedging Transaction or sales or transfers of Registrable
Securities in connection therewith covered by a Registration Statement under the
Securities Act in a manner consistent with the rights and obligations of the
Company hereunder.
(b) All
Registration Statements in which Holders may include Registrable Securities
under this Agreement shall be subject to the provisions of this Section
7. The selection of any Hedging Counterparty shall not be subject to
Section 2(f), but the Hedging Counterparty shall be selected by the Holders of a
majority of the Registrable Securities subject to the Hedging Transaction that
is proposed to be effected.
(c) If in
connection with a Hedging Transaction, a Hedging Counterparty or any Affiliate
thereof is (or may be considered) an underwriter or selling stockholder, then it
shall be required to provide customary indemnities to the Company regarding the
plan of distribution and like matters.
15
(d) The
Company further agrees to include, under the caption “Plan of Distribution” (or
the equivalent caption), in each Registration Statement, and any related
Prospectus (to the extent such inclusion is permitted under applicable
Commission regulations and is consistent with comments received from the
Commission during any Commission review of the Registration Statement), language
substantially in the form of Schedule I hereto and
to include in each prospectus supplement filed in connection with any proposed
Hedging Transaction language mutually agreed upon by the Company, the relevant
Holders and the Hedging Counterparty describing such Hedging
Transaction.
(e) In
connection with a Hedging Transaction, each Hedging Counterparty shall be
treated in the same manner as a managing underwriter for purposes of Section 5
of this Agreement.
8. Indemnification;
Contribution.
(a) The
Company agrees to indemnify and hold harmless each Holder of Registrable
Securities, the Affiliates, directors, officers, employees, members, managers
and agents of each such Holder and each Person who controls any such Holder
within the meaning of either the Securities Act or the Exchange Act, to the
fullest extent permitted by applicable law, from and against any and all losses,
claims, damages, liabilities and expenses to which they or any of them may
become subject insofar as such losses, claims, damages, liabilities and 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 a
Registration Statement as originally filed or in any amendment thereof, or the
Disclosure Package, or any preliminary, final or summary Prospectus or Free
Writing Prospectus included in any such Registration Statement, or in any
amendment thereof or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, and
agrees to reimburse each such indemnified party, as incurred, for any legal or
other expenses reasonably incurred by them in connection with investigating or
defending
any such loss, claim, damage, liability or action (whether or not the
indemnified party is a party to any proceeding); provided, however, that the
Company will not be liable in any case to the extent that any such loss, claim,
damage, liability or expense arises (i) out of or is based upon any such untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished to
the Company by or on behalf of any such Holder specifically for inclusion
therein including, without limitation, any notice and questionnaire, or (ii) out
of sales of Registrable Securities made during a Suspension Period after notice
is given pursuant to Section 2(e)(ii) hereof. This indemnity
agreement will be in addition to any liability which the Company may otherwise
have.
(b) Each
Holder severally (and not jointly) agrees to indemnify and hold harmless the
Company and each of its Affiliates, directors, employees, members, managers and
agents and each Person who controls the Company within the meaning of either the
Securities Act or the Exchange Act, to the fullest extent permitted by
applicable law, from and against any and all losses, claims, damages or
liabilities to which they or any of them may become subject insofar as such
losses, claims, damages or liabilities arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in a
Registration Statement as originally filed or in any amendment thereof, or in
the Disclosure Package or any Holder Free Writing
16
Prospectus,
preliminary, final or summary Prospectus included in any such Registration
Statement, or in any amendment thereof or supplement thereto, or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, to the extent, but only to the extent, that any such untrue
statement or alleged untrue statement or omission or alleged omission is
contained in any written information relating to such Holder furnished to the
Company by or on behalf of such Holder specifically for inclusion therein;
provided, however, that the total amount to be indemnified by such Holder
pursuant to this Section 8(b) shall be limited to the net proceeds (after
deducting underwriters’ discounts and commissions) received by such Holder in
the offering to which such Registration Statement or Prospectus
relates. This indemnity agreement will be in addition to any
liability which any such Holder may otherwise have.
(c) Promptly
after receipt by an indemnified party under this Section 8 of notice of the
commencement of any action, such indemnified party will, if a claim in respect
thereof is to be made against the indemnifying party under this Section 8,
notify the indemnifying party in writing of the commencement thereof; but the
failure so to notify the indemnifying party (i) will not relieve it from
liability under paragraph (a) or (b) above unless and to the extent such action
and such failure results in material prejudice to the indemnifying party and
forfeiture by the indemnifying party of substantial rights and defenses; and
(ii) will not, in any event, relieve the indemnifying party from any obligations
to any indemnified party other than the indemnification obligation provided in
paragraph (a) or (b) above. The indemnifying party shall be entitled
to participate therein and, to the extent that it shall wish, jointly with any
other indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (who shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and,
except as provided in the next sentence, after notice from the indemnifying
party to such indemnified party of its election to so assume the defense
thereof, the indemnifying party shall not be liable to such indemnified party
for any legal expenses of other counsel or any other expenses subsequently
incurred by such indemnified party in connection with the
defense thereof other than reasonable costs of
investigation. Notwithstanding the indemnifying party’s rights in the
prior sentence, the indemnified party shall have the right to employ its own
counsel (and one local counsel), and the indemnifying party shall bear the
reasonable fees, costs and expenses of such separate counsel if (i) the use of
counsel chosen by the indemnifying party to represent the indemnified party
would present such counsel with a conflict of interest; (ii) the actual or
potential defendants in, or targets of, any such action include both the
indemnified party and the indemnifying party and the indemnified party shall
have reasonably concluded that there may be legal defenses available to it
and/or other indemnified parties which are different from or additional to those
available to the indemnifying party; (iii) the indemnifying party shall not have
employed counsel satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of the institution of
such action; or (iv) the indemnifying party shall authorize the indemnified
party to employ separate counsel at the expense of the indemnifying
party. No indemnifying party shall, in connection with any one action
or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general circumstances or allegations, be
liable for the fees and expenses of more than one separate firm of attorneys (in
addition to any local counsel) for all indemnified parties. An
indemnifying party shall not be liable under this Section 8 to any indemnified
party regarding any settlement or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of
17
which
indemnification or contribution may be sought hereunder (whether or not the
indemnified parties are actual or potential parties to such claim or action)
unless such settlement, compromise or consent is consented to by such
indemnifying party, which consent shall not be unreasonably
withheld. No indemnifying party, in the defense of any such claim or
litigation, shall, except with the consent of each indemnified party, consent to
entry of any judgment or enter into any settlement or compromise that does not
include as an unconditional term thereof the giving by the claimant or plaintiff
therein, to such indemnified party, of a full and final release from all
liability in respect to such claim or litigation.
(d) In the
event that the indemnity provided in Section 8(a) or Section 8(b) above is
unavailable to or insufficient to hold harmless an indemnified party for any
reason, then each applicable indemnifying party agrees to contribute to the
aggregate losses, claims, damages and liabilities (including, without
limitation, legal or other expenses reasonably incurred in connection with
investigating or defending same) (collectively, “Losses”) to which
such indemnifying party may be subject in such proportion as is appropriate to
reflect the relative benefits received by the indemnifying party on the one hand
and by the indemnified party on the other from the offering of the New Common
Stock. If, however, the allocation provided by the immediately
preceding sentence is not permitted by applicable law, then each indemnifying
party shall contribute to such amount paid or payable by such indemnified party
in such proportion as is appropriate to reflect not only such relative benefits
but also the relative fault of the indemnifying party on the one hand and the
indemnified party on the other in connection with the statements or omissions
which resulted in such losses, claims, damages or liabilities (or actions in
respect thereof), as well as any other relevant equitable
considerations. The relative fault 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 indemnifying party on the one hand or the
indemnified party on the other and the parties’ relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The parties agree that it would not be just
and equitable if contribution pursuant to this Section 8(d) were determined by
pro rata allocation (even if the Holders of Registrable Securities or any agents
or underwriters or all of them 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 above in this Section 8(d). The amount
paid or payable by an indemnified party as a result of the losses, claims,
damages or liabilities (or actions in respect thereof) referred to above in this
Section 8(d) shall be deemed to include 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 8(d), 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. For purposes of this Section 8, each Person who
controls any Holder of Registrable Securities, agent or underwriter within the
meaning of either the Securities Act or the Exchange Act and each director,
officer, employee and agent of any such Holder, agent or underwriter shall have
the same rights to contribution as such Holder, agent or underwriter, and each
Person who controls the Company within the meaning of either the Securities Act
or the Exchange Act and each officer and director of the Company shall have the
same rights to contribution as the Company, subject in each case to the
applicable terms and conditions of this Section 8(d).
18
(e) The
provisions of this Section 8 will remain in full force and effect, regardless of
any investigation made by or on behalf of any Holder of Registrable Securities
or the Company or any of the officers, directors or controlling Persons referred
to in this Section 8 hereof, and will survive the transfer of Registrable
Securities.
(f) To the
extent any indemnification by an indemnifying party is prohibited or limited by
law, the indemnifying party agrees to make the maximum contribution with respect
to any amounts for which it would otherwise be liable under Section 8 to the
fullest extent permitted by law; provided, however, that: (i) no Person involved
in the sale of Registrable Securities which Person is guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the 1933 Act) in
connection with such sale shall be entitled to contribution from any Person
involved in such sale of Registrable Securities who was not guilty of fraudulent
misrepresentation; and (ii) contribution by any seller of Registrable Securities
shall be limited in amount to the net amount of proceeds received by such seller
from the sale of such Registrable Securities pursuant to such Shelf
Registration.
9. Participation
in Underwritten Offering/Sale of Registrable Securities.
(a) No Person
may participate in any underwritten offering hereunder unless such Person (i)
agrees to sell such Person’s securities on the basis provided in any
underwriting arrangements in customary form entered into pursuant to this
Agreement and (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements; provided that no
Holder of Registrable Securities included in any underwritten registration shall
be required to make any representations or warranties to the Company or the
underwriters (other than representations and warranties regarding (1) such
Holder’s ownership of its Registrable Securities to be sold or transferred, (2)
such Holder’s power and authority to effect such transfer and (3) such matters
pertaining to compliance with securities laws as may be reasonablyrequested)
or to undertake any indemnification obligations to the Company with respect
thereto, except as otherwise provided in Section 8(b) hereof, or to the
underwriters with respect thereto, except to the extent of the indemnification
being given to the Company and its controlling persons in Section 8(b)
hereof.
(b) Each
Person that has securities registered on a Registration Statement filed
hereunder agrees that, upon receipt of any notice contemplated in Section
2(e)(ii), such Person will forthwith discontinue the disposition of its
Registrable Securities pursuant to the applicable Registration
Statement.
10. Rule 144
and Rule 144A; Other Exemptions. With a view to making available to
the Holders of Registrable Securities the benefits of Rule 144 and Rule 144A
promulgated under the Securities Act and other rules and regulations of the
Commission that may at any time permit a Holder of Registrable Securities to
sell securities of the Company to the public without registration, the Company
covenants that it will (i) file in a timely manner all reports and other
documents required, if any, to be filed by it under the Securities Act and the
Exchange Act and the rules and regulations adopted thereunder and (ii) make
available information necessary to comply with Rule 144 and Rule 144A, if
available with respect to resales of the Registrable Securities under the
Securities Act, at all times, all to the extent required from time to time to
19
enable
such Holder to sell Registrable Securities without registration under the
Securities Act within the limitation of the exemptions provided by (x) Rule 144
and Rule 144A promulgated under the Securities Act (if available with respect to
resales of the Registrable Securities), as such rules may be amended from time
to time or (y) any other rules or regulations now existing or hereafter adopted
by the Commission. Upon the reasonable request of any Holder of
Registrable Securities, the Company will deliver to such Holder a written
statement as to whether it has complied with such information requirements, and,
if not, the specific reasons for non-compliance.
11. Transfer
of Registration Rights. The rights of a Holder hereunder may be
transferred, assigned, or otherwise conveyed on a pro rata basis in connection
with any transfer, assignment, or other conveyance of Registrable Securities to
any transferee or assignee; provided that all of
the following additional conditions are satisfied: (a) such transfer
or assignment is effected in accordance with applicable securities laws; (b)
such transferee or assignee agrees in writing to become subject to the terms of
this Agreement; and (c) the Company is given written notice by such Holder of
such transfer or assignment, stating the name and address of the transferee or
assignee and identifying the Registrable Securities with respect to which such
rights are being transferred or assigned.
12. Amendment,
Modification and Waivers; Further Assurances
(a) Amendment. This
Agreement may be amended with the consent of the Company and the Company may
take any action herein prohibited, or omit to perform any act herein required to
be performed by it, only if the Company shall have obtained the written consent
of the Holders of at least a majority of the Registrable Securities then
outstanding to such amendment, action or omission to act; provided that no such
amendment, action or omission that adversely affects, alters or
changes the interests of any Holder shall be effective against such Holder
without the prior written consent of such Holder.
(b) Effect of
Waiver. No
waiver of any terms or conditions of this Agreement shall operate as a waiver of
any other breach of such terms and conditions or any other term or condition,
nor shall any failure to enforce any provision hereof operate as a waiver of
such provision or of any other provision hereof. No written waiver hereunder,
unless it by its own terms explicitly provides to the contrary, shall be
construed to effect a continuing waiver of the provisions being waived and no
such waiver in any instance shall constitute a waiver in any other instance or
for any other purpose or impair the right of the party against whom such waiver
is claimed in all other instances or for all other purposes to require full
compliance with such provision. The failure of any party to enforce
any provision of this Agreement shall not be construed as a waiver of such
provision and shall not affect the right of such party thereafter to enforce
each provision of this Agreement in accordance with its terms.
(c) Further
Assurances. Each of
the parties hereto shall execute all such further instruments and documents and
take all such further action as any other party hereto may reasonably require in
order to effectuate the terms and purposes of this Agreement.
20
13. Miscellaneous.
(a) No
Inconsistent Agreements. The
Company shall not hereafter enter into any agreement with respect to its
securities which is inconsistent with or violates the rights granted to the
Holders of Registrable Securities in this Agreement.
(b) Adjustments
Affecting Registrable Securities. The
Company shall not take any action, or permit any change to occur, with respect
to its securities which would materially and adversely affect the ability of the
Holders of Registrable Securities to include such Registrable Securities in a
registration undertaken pursuant to this Agreement or which would materially and
adversely affect the marketability of such Registrable Securities in any such
registration (including effecting a stock split or a combination of
shares).
(c) Remedies;
Specific Performance. Any
Person having rights under any provision of this Agreement shall be entitled to
enforce such rights specifically, to recover damages caused by reason of any
breach of any provision of this Agreement and to exercise all other rights
existing in their favor. The parties hereto agree and acknowledge that money
damages would not be an adequate remedy for any breach of the provisions of this
Agreement and that any party may in its sole discretion apply to any court of
law or equity of competent jurisdiction for specific performance and/or
injunctive relief
(without posting any bond or other security) in order to enforce or prevent
violation of the provisions of this Agreement and shall not be required to prove
irreparable injury to such party or that such party does not have an adequate
remedy at law with respect to any breach of this Agreement (each of which
elements the parties admit). The parties hereto further agree and acknowledge
that each and every obligation applicable to it contained in this Agreement
shall be specifically enforceable against it and hereby waives and agrees not to
assert any defenses against an action for specific performance of their
respective obligations hereunder. All rights and remedies existing
under this Agreement are cumulative to, and not exclusive of, any rights or
remedies available under this Agreement or otherwise.
(d) Successors
and Assigns. All
covenants and agreements in this Agreement by or on behalf of any of the parties
hereto shall bind and inure to the benefit of the respective successors and
assigns of the parties hereto (including any trustee in bankruptcy) whether so
expressed or not. In addition, whether or not any express assignment has been
made, the provisions of this Agreement which are for the benefit of purchasers
or Holders of Registrable Securities are also for the benefit of, and
enforceable by, any subsequent Holder of Registrable Securities. No assignment
or delegation of this Agreement by the Company, or any of the Company’s rights,
interests or obligations hereunder, shall be effective against any Holder
without the prior written consent of such Holder.
(e) Severability. Whenever
possible, each provision of this Agreement shall be interpreted in such manner
as to be effective and valid under applicable law, but if any provision of this
Agreement is held to be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of this
Agreement.
21
(f) Counterparts. This
Agreement may be executed simultaneously in two or more counterparts, any one of
which need not contain the signatures of more than one party, but all such
counterparts taken together shall constitute one and the same
Agreement.
(g) Descriptive
Headings; Interpretation; No Strict Construction. The
descriptive headings of this Agreement are inserted for convenience only and do
not constitute a substantive part of this Agreement. Whenever required by the
context, any pronoun used in this Agreement shall include the corresponding
masculine, feminine or neuter forms, and the singular forms of nouns, pronouns,
and verbs shall include the plural and vice versa. Reference to any agreement,
document, or instrument means such agreement, document, or instrument as amended
or otherwise modified from time to time in accordance with the terms thereof,
and, if applicable, hereof. The words “include”, “includes” or “including” in
this Agreement shall be deemed to be followed by “without limitation”. The use
of the words “or,” “either” or “any” shall not be exclusive. The parties hereto
have participated jointly in the negotiation and drafting of this Agreement. If
an ambiguity or question of intent or interpretation arises, this Agreement
shall be construed as if drafted jointly by the parties hereto, and no
presumption
or burden of proof shall arise favoring or disfavoring any party by virtue of
the authorship of any of the provisions of this Agreement. All
references to laws, rules, regulations and forms in this Agreement shall be
deemed to be references to such laws, rules, regulations and forms, as amended
from time to time or, to the extent replaced, the comparable successor thereto
in effect at the time. All references to agencies, self-regulatory
organizations or governmental entities in this Agreement shall be deemed to be
references to the comparable successors thereto from time to
time.
(h) Governing
Law. This
Agreement and the exhibits and schedules hereto shall be governed by, and
construed in accordance with, the laws of the State of New York, without giving
effect to any choice of law or conflict of law rules or provisions (whether of
the State of New York or any other jurisdiction) to the extent such rules or
provisions would cause the application of the laws of any jurisdiction other
than the State of New York.
(i) Notices. All
notices, demands or other communications to be given or delivered under or by
reason of the provisions of this Agreement shall be in writing and shall be
deemed to have been given when (a) delivered personally to the recipient, (b)
telecopied or sent by facsimile to the recipient, or (c) one (1) Business Day
after being sent to the recipient by reputable overnight courier service
(charges prepaid). Such notices, demands and other communications shall be sent
to the Company at the address set forth below and to any Holder of Registrable
Securities at the address set forth on the signature page hereto, or at such
address or to the attention of such other Person as the recipient party has
specified by prior written notice to the sending party. The Company’s address
is:
Charter
Communications, Inc.
12405
Powerscourt Drive
St.
Louis, Missouri 63131
Attention: General
Counsel
22
with
copies to:
Attn: Christian O.
Nagler, Esq.
Kirkland
& Ellis LLP
601
Lexington Avenue
New York,
NY 10022-4611
Facsimile: (212)
446-4900
Notices
to the Holders shall be sent to:
Paul,
Weiss, Rifkind, Wharton & Garrison LLP
1285
Avenue of the Americas
New York,
New York 10019-6064
Attention:
Facsimile:
and
to:
Skadden,
Arps, Slate, Meagher & Flom LLP
300 South
Grand Avenue
Los
Angeles, CA 90071
Attention:
Nicholas P. Saggese
Facsimile:
(213) 687-5600
If any
time period for giving notice or taking action hereunder expires on a day which
is a Saturday, Sunday or legal holiday in the State of New York or the
jurisdiction in which the Company’s principal office is located, the time period
shall automatically be extended to the Business Day immediately following such
Saturday, Sunday or legal holiday.
(j) Delivery
by Facsimile. This
Agreement, the agreements referred to herein, and each other agreement or
instrument entered into in connection herewith or therewith or contemplated
hereby or thereby, and any amendments hereto or thereto, to the extent signed
and delivered by means of a facsimile machine or other electronic means, shall
be treated in all manner and respects as an original agreement or instrument and
shall be considered to have the same binding legal effect as if it were the
original signed version thereof delivered in person. At the request of any party
hereto or to any such agreement or instrument, each other party hereto or
thereto shall reexecute original forms thereof and deliver them to all other
parties. No party hereto or to any such agreement or instrument shall raise the
use of a facsimile machine or other electronic means to deliver a signature or
the fact that any signature or agreement or instrument was transmitted or
communicated through the use of a facsimile machine or other electronic means as
a defense to the formation or enforceability of a contract and each such party
forever waives any such defense.
(k) Waiver of
Jury Trial. Each
of the parties to this Agreement hereby agrees to waive its respective rights to
a jury trial of any claim or cause of action based upon or arising out of this
Agreement. The scope of this waiver is intended to be all-encompassing of any
and all disputes that may be filed in any court and that relate to the subject
matter of this Agreement,
23
including
contract claims, tort claims and all other common law and statutory claims. Each
party hereto acknowledges that this waiver is a material inducement to enter
into this Agreement, that each has already relied on this waiver in entering
into this Agreement, and that each will continue to rely on this waiver in their
related future dealings. Each party hereto further warrants and represents that
it has reviewed this waiver with its legal counsel and that it knowingly and
voluntarily waives its jury trial rights following consultation with legal
counsel. THIS WAIVER IS IRREVOCABLE, MEANING THAT IT MAY NOT BE MODIFIED EITHER
ORALLY OR IN WRITING (OTHER THAN BY A MUTUAL WRITTEN WAIVER SPECIFICALLY
REFERRING TO THIS SECTION 13(k) AND
EXECUTED BY EACH OF THE PARTIES HERETO), AND THIS WAIVER SHALL APPLY TO ANY
SUBSEQUENT AMENDMENTS, RENEWALS, SUPPLEMENTS OR
MODIFICATIONS TO THIS AGREEMENT. In the event of litigation, this Agreement may
be filed as a written consent to a trial by the court.
(l) Arm’s
Length Agreement. Each
of the parties to this Agreement agrees and acknowledges that this Agreement has
been negotiated in good faith, at arm’s length, and not by any means prohibited
by law.
(m) Sophisticated
Parties; Advice of Counsel. Each
of the parties to this Agreement specifically acknowledges that (a) it is a
knowledgeable, informed, sophisticated Person capable of understanding and
evaluating the provisions set forth in this Agreement and (ii) it has been fully
advised and represented by legal counsel of its own independent selection and
has relied wholly upon its independent judgment and the advice of such counsel
in negotiating and entering into this Agreement.
(n) Entire
Agreement. This
Agreement, together with Schedule I attached hereto, and any certificates,
documents, instruments and writings that are delivered pursuant hereto,
constitutes the entire agreement and understanding of the parties in respect of
the subject matter hereof and supersedes all prior understandings, agreements or
representations by or among the parties, written or oral, to the extent they
relate in any way to the subject matter hereof.
(o) Attorneys’
Fees. In
the event of litigation or other proceedings in connection with or related to
this Agreement, the prevailing party in such litigation or proceeding shall be
entitled to reimbursement from the opposing party of all reasonable expenses,
including, without limitation, reasonable attorneys’ fees and expenses of
investigation in connection with such litigation or proceeding.
(p) Certification. Within
fifteen (15) Business Days following receipt of written request from the Company
by any Holder (which request shall not be made more than twice in any calendar
year), such Holder shall certify to the Company that such Holder continues to
hold Registrable Securities (the “Certification”). If
a Holder fails to provide the Certification within the fifteen (15) Business Day
period referred to in the immediately preceding sentence, the Company reserves
the right, in its sole discretion, to remove such Holder’s Registrable
Securities from a Registration Statement within fifteen (15) Business Days after
receipt by such Holder of a second written notice specifying that the Holder may
be removed from such Registration Statement unless such Holder provides the
Certification within such subsequent fifteen (15) Business Day
period.
24
(q) FWP
Consent. No Holder
shall use a Holder Free Writing Prospectus without the prior written consent of
the Company, which consent shall not be unreasonably
withheld.
(r) Notification
of Status. Each
Holder shall provide written notice to the Company within ten (10) Business Days
from the first day on which the Holder no longer holds Registrable
Securities.
(s) Termination. The
obligations of the Company and of any Holder, other than those obligations
contained in Section 8, shall terminate with respect to the Company and such
Holder as soon as both (A) such Holder no longer holds any Registrable
Securities and (B) such Holder is no longer an Affiliate of the Company or
otherwise subject to the volume limitations set forth in Rule 144(e) promulgated
under the Securities Act or any successor provision.
* * * * *
25
IN
WITNESS WHEREOF, the parties hereto have executed this Registration Rights
Agreement as of the date first written above.
CHARTER
COMMUNICATIONS, INC.
By: _________________________
Its: _________________________
[Signature
Page to Registration Rights Agreement]
INVESTORS
[Name]
By:
_________________________
Its: _________________________
Address:
[ ]
Facsimile:
[Name]
By: _________________________
Its: _________________________
Address:
[ ]
Facsimile:
[Name]
By: _________________________
Its: _________________________
Address:
[ ]
Facsimile:
[Signature
Page to Registration Rights Agreement]
SCHEDULE
I
Plan
of Distribution
A selling
stockholder may also enter into hedging and/or monetization
transactions. For example, a selling stockholder may:
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(a)
|
enter
into transactions with a broker-dealer or affiliate of a broker-dealer or
other third party in connection with which that other party will become a
selling stockholder and engage in short sales of the common stock under
this prospectus, in which case the other party may use shares of common
stock received from the selling stockholder to close out any short
positions;
|
|
(b)
|
itself
sell short common stock under this prospectus and use shares of common
stock held by it to close out any short
position;
|
|
(c)
|
enter
into options, forwards or other transactions that require the selling
stockholder to deliver, in a transaction exempt from registration under
the Securities Act, common stock to a broker-dealer or an affiliate of a
broker-dealer or other third party who may then become a selling
stockholder and publicly resell or otherwise transfer that common stock
under this prospectus; or
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|
(d)
|
loan
or pledge common stock to a broker-dealer or affiliate of a broker-dealer
or other third party who may then become a selling stockholder and sell
the loaned shares or, in an event of default in the case of a pledge,
become a selling stockholder and sell the pledged shares, under this
prospectus.
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