Exhibit 10.1
REGISTRATION RIGHTS AGREEMENT
Dated as of July 7, 2009
by and among
Real Mex Restaurants, Inc.
Acapulco Restaurants, Inc.
El Torito Restaurants, Inc.
CKR Acquisition Corp.
Chevys Restaurants, LLC
El Torito Franchising Company
Acapulco Restaurant of Ventura, Inc.
Acapulco Restaurant of Westwood, Inc.
Acapulco Restaurants of Downey, Inc.
Murray Pacific
Acapulco Restaurant of Moreno Valley, Inc.
El Paso Cantina, Inc.
Real Mex Foods, Inc.
TARV, Inc.
ALA Design, Inc.
Acapulco Mark Corp.
RM Restaurant Holding Corp.
and
Jefferies & Company, Inc.

 

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This Registration Rights Agreement (this “Agreement”) is made and entered into
as of July 7, 2009, by and among Real Mex Restaurants, Inc., a Delaware
corporation (the “Company”), Acapulco Restaurants, Inc., a Delaware corporation,
El Torito Restaurants, Inc., a Delaware corporation, CKR Acquisition Corp., a
Delaware corporation, Chevys Restaurants, LLC, a Delaware limited liability
company, El Torito Franchising Company, a Delaware corporation, Acapulco
Restaurant of Ventura, Inc., a California corporation, Acapulco Restaurant of
Westwood, Inc., a California corporation, Acapulco Restaurant of Downey, Inc., a
California corporation, Murray Pacific, a California corporation, Acapulco
Restaurant of Moreno Valley, Inc., a California corporation, El Paso Cantina,
Inc., a California corporation, Real Mex Foods, Inc., a California corporation,
TARV, Inc., a California corporation, ALA Design, Inc., a California
corporation, Acapulco Mark Corp., a Delaware corporation, and RM Restaurant
Holding Corp., a Delaware corporation (each a “Guarantor”, and, collectively,
the “Guarantors”), and Jefferies & Company, Inc. (the “Initial Purchaser”), who
has agreed to purchase the Company’s 14% Senior Secured Notes due 2013 (the
“Series A Notes”) pursuant to the Purchase Agreement (as defined below).
This Agreement is made pursuant to the Purchase Agreement, dated July 1, 2009,
(the “Purchase Agreement”), by and among the Company, the Guarantors and the
Initial Purchaser. In order to induce the Initial Purchaser to purchase the
Series A Notes, the Company has agreed to provide the registration rights set
forth in this Agreement. The execution and delivery of this Agreement is a
condition to the obligations of the Initial Purchaser set forth in Section 8 of
the Purchase Agreement. Capitalized terms used herein and not otherwise defined
shall have the meaning assigned to them the Indenture, dated July 7, 2009,
between the Company and Wells Fargo Bank, National Association, as Trustee (the
“Trustee”), relating to the Series A Notes and the Series B Notes (as defined
below) (the “Indenture”).
The parties hereby agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement, the following capitalized terms shall have the
following meanings:
Act: The Securities Act of 1933, as amended.
Affiliate: As defined in Rule 144 of the Act.
Broker-Dealer: Any broker or dealer registered under the Exchange Act.
Business Day: Any day except a Saturday, Sunday or any other day on which
banking institutions in the City of New York, NY or in the city of the corporate
trust office of the Trustee, are authorized or obligated by law or regulation to
close.
Closing Date: The date of this Agreement.
Commission: The Securities and Exchange Commission.

 

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Consummate: An Exchange Offer shall be deemed “Consummated” for purposes of this
Agreement upon the occurrence of (a) the filing and effectiveness under the Act
of the Exchange Offer Registration Statement relating to the Series B Notes to
be issued in the Exchange Offer, (b) the maintenance of such Exchange Offer
Registration Statement continuously effective and the keeping of the Exchange
Offer open for a period not less than the period required pursuant to Section
3(b) hereof and (c) the delivery by the Company to the Registrar under the
Indenture of Series B Notes in the same aggregate principal amount as the
aggregate principal amount of Series A Notes tendered by Holders thereof
pursuant to the Exchange Offer.
Consummation Deadline: As defined in Section 3(b) hereof.
Effectiveness Deadline: The Exchange Effectiveness Deadline or Shelf
Effectiveness Deadline, as applicable.
Exchange Act: The Securities Exchange Act of 1934, as amended.
Exchange Effectiveness Deadline: As defined in Section 3(a) hereof.
Exchange Filing Deadline: As defined in Section 3(a) hereof.
Exchange Offer: The registration by the Company under the Act of the Series B
Notes pursuant to a Registration Statement pursuant to which the Company offers
the Holders of all outstanding Transfer Restricted Securities who are not
prohibited by law or a policy of the Commission from participating in such offer
the opportunity to exchange all such outstanding Transfer Restricted Securities
held by such Holders for Series B Notes in an aggregate principal amount equal
to the aggregate principal amount of the Transfer Restricted Securities tendered
in such exchange offer by such Holders.
Exchange Offer Registration Statement: The Registration Statement relating to
the Exchange Offer, including the related Prospectus.
Filing Deadline: The Exchange Filing Deadline or Shelf Filing Deadline, as
applicable.
Holders: As defined in Section 2 hereof.
Person: An individual, partnership, corporation, trust, limited liability
company or unincorporated organization, or a government or agency or political
subdivision thereof or other legal entity.
Prospectus: The prospectus included in a Registration Statement, as amended or
supplemented by any prospectus supplement and by all other amendments thereto,
including post-effective amendments, and all material incorporated by reference
into such Prospectus.
Purchase Agreement: As defined in the preamble hereof.
Recommencement Date: As defined in Section 6(d) hereof.
Registration Default: As defined in Section 5 hereof.

 

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Registration Statement: Any registration statement of the Company and the
Guarantors relating to (a) an offering of Series B Notes pursuant to an Exchange
Offer or (b) the registration for resale of Transfer Restricted Securities
pursuant to the Shelf Registration Statement, in each case, (i) that is filed
pursuant to the provisions of this Agreement and (ii) including the Prospectus
included therein, all amendments and supplements thereto (including
post-effective amendments) and all exhibits and material incorporated by
reference therein.
Regulation S-K: Regulation S-K promulgated under the Act.
Rule 144: Rule 144 promulgated under the Act.
Series A Notes: As defined in the preamble hereto.
Series B Notes: The Company’s 14% Series B Senior Notes due 2013 to be issued
pursuant to the Indenture: (i) in the Exchange Offer or (ii) as contemplated by
Section 4 hereof.
Shelf Effectiveness Deadline: As defined in Section 4(a) hereof.
Shelf Filing Deadline: As defined in Section 4(a) hereof.
Shelf Registration Statement: As defined in Section 4(a) hereof.
Subsequent Registration Statement: As defined in Section 6(c) hereof.
Suspension Notice: As defined in Section 6(d) hereof.
TIA: The Trust Indenture Act of 1939 (15 U.S.C. Section 77aaa-77bbbb) as in
effect on the date of the Indenture.
Transactions: As defined in Section 6(d) hereof.
Transfer Restricted Securities: Each (A) Series A Note, until the earliest to
occur of (i) the date on which such Series A Note is exchanged in the Exchange
Offer for a Series B Note which is entitled to be resold to the public by the
Holder thereof without complying with the prospectus delivery requirements of
the Act, (ii) the date on which such Series A Note has been disposed of in
accordance with a Shelf Registration Statement (and the purchasers thereof have
been issued Series B Notes), or (iii) the date on which such Series A Note is
distributed to the public pursuant to Rule 144 under the Act, (B) Series B Note
held by a Broker-Dealer until the date on which such Series B Note is disposed
of by a Broker-Dealer pursuant to the “Plan of Distribution” contemplated by the
Exchange Offer Registration Statement (including the delivery of the Prospectus
contained therein) and (C) Private Series B Note.
SECTION 2. HOLDERS
A Person is deemed to be a holder of Transfer Restricted Securities (each, a
“Holder”) whenever such Person owns Transfer Restricted Securities, has a
beneficial interest in Transfer Restricted Securities issued in book-entry form
or has the right to acquire such Transfer Restricted Securities, whether or not
such acquisition has actually been effected and disregarding any legal
restrictions upon the exercise of such right.

 

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SECTION 3. REGISTERED EXCHANGE OFFER
(a) Unless the Exchange Offer shall not be permitted by applicable federal law
(after the procedures set forth in Section 6(a)(i) below have been complied
with), the Company and the Guarantors shall (i) cause the Exchange Offer
Registration Statement to be filed with the Commission no later than 90 days
after the Closing Date (such 90th day being the “Exchange Filing Deadline”),
(ii) use all commercially reasonable efforts to cause such Exchange Offer
Registration Statement to become effective at the earliest possible time, but no
later than 180 days after the Closing Date (such 180th day being the “Exchange
Effectiveness Deadline”), (iii) in connection with the foregoing, (A) file all
pre-effective amendments to such Exchange Offer Registration Statement as may be
necessary in order to cause it to become effective, (B) file, if applicable, a
post-effective amendment to such Exchange Offer Registration Statement pursuant
to Rule 430A under the Act and (C) cause all necessary filings, if any, in
connection with the registration and qualification of the Series B Notes to be
made under the Blue Sky laws of such jurisdictions as are necessary to permit
Consummation of the Exchange Offer, and (iv) upon the effectiveness of such
Exchange Offer Registration Statement, commence and Consummate the Exchange
Offer. The Exchange Offer shall be on the appropriate form permitting
(i) registration of the Series B Notes to be offered in exchange for the
Series A Notes that are Transfer Restricted Securities and (ii) resales of
Series B Notes by Broker-Dealers that tendered into the Exchange Offer Series A
Notes that such Broker-Dealer acquired for its own account as a result of market
making activities or other trading activities (other than Series A Notes
acquired directly from the Company or any of its Affiliates) as contemplated by
Section 3(c) below.
(b) The Company and the Guarantors shall use all commercially reasonable efforts
to cause the Exchange Offer Registration Statement to be effective continuously,
and shall use all commercially reasonable efforts to keep the Exchange Offer
open for a period of not less than the minimum period required under applicable
federal and state securities laws to Consummate the Exchange Offer; provided,
however, that in no event shall such period be less than 20 Business Days. The
Company and the Guarantors shall cause the Exchange Offer to comply with all
applicable federal and state securities laws. No securities other than the
Series B Notes (and related guarantees) shall be included in the Exchange Offer
Registration Statement. The Company and the Guarantors shall use all
commercially reasonable efforts to cause the Exchange Offer to be Consummated on
the earliest practicable date after the Exchange Offer Registration Statement
has become effective, but in no event later than 30 Business Days thereafter
(such 30th day being the “Consummation Deadline”), or such longer period as is
required by federal securities laws.
(c) The Company shall include a “Plan of Distribution” section in the Prospectus
contained in the Exchange Offer Registration Statement and indicate therein that
any Broker-Dealer who holds Transfer Restricted Securities that were acquired
for the account of such Broker-Dealer as a result of market-making activities or
other trading activities (other than Series A Notes acquired directly from the
Company or any Affiliate of the Company), may exchange such Transfer Restricted
Securities pursuant to the Exchange Offer. Such “Plan of Distribution” section
shall also contain all other information with respect to such sales by such
Broker-Dealers that the Commission may require in order to permit such sales
pursuant thereto, but such “Plan of Distribution” shall not name any such
Broker-Dealer or disclose the amount of Transfer Restricted Securities held by
any such Broker-Dealer, except to the extent required by the Commission. See the
Shearman & Sterling no-action letter (available July 2, 1993).

 

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Because such Broker-Dealer may be deemed to be an “underwriter” within the
meaning of the Act and must, therefore, deliver a prospectus meeting the
requirements of the Act in connection with its initial sale of any Series B
Notes received by such Broker-Dealer in the Exchange Offer, the Company and
Guarantors shall permit the use of the Prospectus contained in the Exchange
Offer Registration Statement by such Broker-Dealer to satisfy such prospectus
delivery requirement. To the extent necessary to ensure that the Prospectus
contained in the Exchange Offer Registration Statement is available for sales of
Series B Notes by Broker-Dealers, the Company and the Guarantors agree to use
all commercially reasonable efforts to keep the Exchange Offer Registration
Statement continuously effective, supplemented, amended and current as required
by and subject to the provisions of Section 6(a) and (c) hereof and in
conformity with the requirements of this Agreement, the Act and the policies,
rules and regulations of the Commission as announced from time to time, for a
period of 180 days from the Consummation Deadline or such shorter period as will
terminate when all Transfer Restricted Securities covered by such Registration
Statement have been sold pursuant thereto. The Company and the Guarantors shall
provide sufficient copies of the latest version of such Prospectus to such
Broker-Dealers, promptly upon request, and in no event later than five Business
Days after such request, at any time during such period.
(d) If, upon consummation of the Exchange Offer, any Holder who is not entitled
to participate in the Exchange Offer holds any Series A Notes, the Company (upon
the written request from such Holder) shall, simultaneously with the delivery of
the Series B Notes pursuant to the Exchange Offer, issue and deliver to such
Holder in exchange (the “Private Exchange”) for the Series A Notes held by such
Holder, a like principal amount at maturity of debt securities of the Company,
including guarantees relating thereto (issued under the same Indenture as the
Series B Notes) that are identical in all material respects to the Series B
Notes except for the existence of restrictions on transfer thereof under the
Securities Act and securities laws of the several states of the United States
(the “Private Series B Notes”). The Private Series B Notes shall bear the same
CUSIP number as the Series B Notes.
SECTION 4. SHELF REGISTRATION
(a) Shelf Registration. If (i) the Exchange Offer is not permitted by applicable
law (after the Company and the Guarantors have complied with the procedures set
forth in Section 6(a)(i) below), (ii) subsequent to the consummation of the
Private Exchange, any Holder of Private Series B Notes so requests or (iii) if
any Holder of Transfer Restricted Securities shall notify the Company within 20
Business Days following the Consummation Deadline that (A) such Holder was
prohibited by law or Commission policy from participating in the Exchange Offer
or (B) such Holder may not resell the Series B Notes acquired by it in the
Exchange Offer to the public without delivering a prospectus and the Prospectus
contained in the Exchange Offer Registration Statement is not appropriate or
available for such resales by such Holder or (C) such Holder is a Broker-Dealer
and holds Series A Notes acquired directly from the Company or any of its
Affiliates, then the Company and the Guarantors shall:
(x) use all commercially reasonable efforts to file, on or prior to 60 days
after the earlier of (i) the date on which the Company determines that the
Exchange Offer Registration Statement cannot be filed as a result of clause
(a)(i) above and (ii) the earliest date on which the Company receives the notice
specified in clause (a)(ii) or (a)(iii) above, (such earlier date, the “Shelf
Filing Deadline”), a shelf registration statement pursuant to Rule 415 under the
Act (which may be an amendment to the Exchange Offer Registration Statement
(together with any Subsequent Shelf Registration Statement, the “Shelf
Registration Statement”)), relating to all Transfer Restricted Securities
(provided, however, that notwithstanding this Section 4(a)(x), (A) the Company
shall not be required to file its Shelf Registration Statement prior to the
Exchange Filing Deadline and (B) the Company shall not be required to file more
than one Shelf Registration Statement pursuant to this Section 4 (other than any
Subsequent Shelf Registration Statements required under Section 6(c)(iii)
hereof)), and

 

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(y) shall use all commercially reasonable efforts to cause such Shelf
Registration Statement to become effective on or prior to 120 days after the
Shelf Filing Deadline (such 120th day the “Shelf Effectiveness Deadline”).
If, after the Company has filed an Exchange Offer Registration Statement that
satisfies the requirements of Section 3(a) above, the Company is required to
file and make effective a Shelf Registration Statement solely because the
Exchange Offer is not permitted under applicable federal law (i.e., clause
(a)(i) above), then the filing of the Exchange Offer Registration Statement
shall be deemed to satisfy the requirements of clause (x) above; provided, that,
in such event, the Company shall remain obligated to file a Shelf Registration
Statement under clause (x) and meet the Shelf Effectiveness Deadline set forth
in clause (y) of this Section 4(a) with respect to such Shelf Registration
Statement except that the Shelf Filing Deadline shall be 90 days after the
Company determines that the Exchange Offer is not so permitted.
To the extent necessary to ensure that the Shelf Registration Statement is
available for sales of Transfer Restricted Securities by the Holders thereof
entitled to the benefit of this Section 4(a) and the other securities required
to be registered therein pursuant to Section 6(b)(ii) hereof, the Company and
the Guarantor(s) shall use all commercially reasonable efforts to keep any Shelf
Registration Statement required by this Section 4(a) continuously effective,
supplemented, amended and current as required by and subject to the provisions
of Sections 6(b) and (c) hereof and in conformity with the requirements of this
Agreement, the Act and the policies, rules and regulations of the Commission as
announced from time to time, for a period of at least two years (as extended
pursuant to Section 6(d)) following the Closing Date, or such shorter period as
will terminate when all Transfer Restricted Securities covered by such Shelf
Registration Statement have been sold pursuant thereto.
(b) Provision by Holders of Certain Information in Connection with the Shelf
Registration Statement. No Holder of Transfer Restricted Securities may include
any of its Transfer Restricted Securities in any Shelf Registration Statement
pursuant to this Agreement unless and until such Holder furnishes to the Company
in writing, within 10 Business Days after receipt of a request therefor, such
information as the Company may reasonably request, including, without
limitation, the information specified in Item 507 or 508 of Regulation S-K, as
applicable, of the Act, for use in connection with any Shelf Registration
Statement or Prospectus or preliminary Prospectus included therein. No Holder of
Transfer Restricted Securities shall be entitled to liquidated damages pursuant
to Section 5 hereof unless and until such Holder shall have provided all such
information. Each selling Holder agrees to promptly furnish additional
information required to be disclosed in order to make the information previously
furnished to the Company by such Holder not materially misleading.

 

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SECTION 5. LIQUIDATED DAMAGES
The Company and the Guarantors acknowledge and agree that the Holders will
suffer damages, and that it would not be feasible to ascertain the extent of
such damages with precision, if the Company and the Guarantors fail to fulfill
their respective obligations hereunder. Accordingly, in the event of such
failure, the Company and the Guarantors jointly and severally agree to pay
liquidated damages to each Holder under the circumstances and to the extent set
forth below (each of which shall be given independent effect).
If (i) any Registration Statement required by this Agreement is not filed with
the Commission on or prior to the applicable Filing Deadline, (ii) any such
Registration Statement has not been declared effective by the Commission on or
prior to the applicable Effectiveness Deadline, (iii) the Exchange Offer has not
been Consummated on or prior to the Consummation Deadline or (iv) any
Registration Statement required by this Agreement is filed and declared
effective but shall thereafter cease to be effective or fail to be usable in
connection with resales of Transfer Restricted Securities during the period
required by this Agreement without being succeeded within 2 Business Days by a
post-effective amendment to such Registration Statement that cures such failure
and that is itself immediately declared effective (each such event referred to
in clauses (i) through (iv), a “Registration Default”), then the Company and the
Guarantors hereby jointly and severally agree to pay to each Holder of Transfer
Restricted Securities affected thereby liquidated damages in an amount equal to
0.25% per annum on the outstanding principal amount of Transfer Restricted
Securities held by such Holder for the first 90-day period immediately following
the occurrence of such Registration Default. The amount of the liquidated
damages shall increase by an additional 0.25% per annum on the outstanding
principal amount of Transfer Restricted Securities with respect to each
subsequent 90-day period until all Registration Defaults have been cured, up to
a maximum amount of liquidated damages of 1.0% per annum on the outstanding
principal amount of Transfer Restricted Securities; provided, that the Company
and the Guarantors shall in no event be required to pay liquidated damages for
more than one Registration Default at any given time. Notwithstanding anything
to the contrary set forth herein, upon the day of (1) filing of the Exchange
Offer Registration Statement (and/or, if applicable, the Shelf Registration
Statement), in the case of (i) above, (2) the effectiveness of the Exchange
Offer Registration Statement (and/or, if applicable, the Shelf Registration
Statement), in the case of (ii) above, (3) the Consummation of the Exchange
Offer, in the case of (iii) above, or (4) the filing of a post-effective
amendment to the Registration Statement or an additional Registration Statement
that causes the Exchange Offer Registration Statement (and/or, if applicable,
the Shelf Registration Statement) to again be declared effective or made usable
in the case of (iv) above, the liquidated damages payable with respect to the
Transfer Restricted Securities as a result of such clause (i), (ii), (iii) or
(iv), as applicable, shall cease.

 

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The Company shall notify the Trustee within five Business Days after each
Registration Default. All accrued liquidated damages shall be paid to the
Holders entitled thereto, in the manner provided for the payment of interest in
the Indenture, on each Interest Payment Date (as such term is defined in the
Indenture), as more fully set forth in the Indenture and the Notes.
Notwithstanding the fact that any securities for which liquidated damages are
due cease to be Transfer Restricted Securities, all obligations of the Company
and the Guarantors to pay liquidated damages with respect to securities shall
survive until such time as such obligations with respect to such securities
shall have been satisfied in full. The liquidated damages set forth above shall
be the exclusive monetary remedy available to the Holders of Transfer Restricted
Securities for Registration Defaults.
SECTION 6. REGISTRATION PROCEDURES
(a) Exchange Offer Registration Statement. In connection with the Exchange
Offer, the Company and the Guarantors shall (x) comply with all applicable
provisions of Section 6(c) below, (y) use all commercially reasonable efforts to
effect such exchange and to permit the resale of Series B Notes by
Broker-Dealers that tendered in the Exchange Offer Series A Notes that such
Broker-Dealer acquired for its own account as a result of its market making
activities or other trading activities (other than Series A Notes acquired
directly from the Company or any of its Affiliates) being sold in accordance
with the intended method or methods of distribution thereof, and (z) comply with
all of the following provisions:
(i) If, following the date hereof there has been announced a change in
Commission policy with respect to exchange offers such as the Exchange Offer,
that in the reasonable opinion of the Company and counsel to the Company raises
a substantial question as to whether the Exchange Offer is permitted by
applicable federal law, the Company and the Guarantors hereby agree to seek a
no-action letter or other favorable decision from the Commission allowing the
Company and the Guarantors to Consummate an Exchange Offer for such Transfer
Restricted Securities. The Company and the Guarantors hereby agree to pursue the
issuance of such a decision to the Commission staff level, but shall not be
required to take commercially unreasonable actions to effect a change in
Commission policy. In connection with the foregoing, the Company and the
Guarantors hereby agree to take all such other actions as may be requested by
the Commission or otherwise required in connection with the issuance of such
decision, including without limitation (A) participating in telephonic
conferences with the Commission, (B) delivering to the Commission staff an
analysis prepared by counsel to the Company setting forth the legal bases, if
any, upon which such counsel has concluded that such an Exchange Offer should be
permitted and (C) diligently pursuing a resolution (which need not be favorable)
by the Commission staff.

 

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(ii) As a condition to its participation in the Exchange Offer, each Holder of
Transfer Restricted Securities (including, without limitation, any Holder who is
a Broker-Dealer) shall furnish, upon the request of the Company, prior to the
Consummation of the Exchange Offer, a written representation to the Company and
the Guarantors (which may be contained in the letter of transmittal contemplated
by the Exchange Offer Registration Statement) to the effect that at the time of
the Consummation (A) it is not an Affiliate of the Company, (B) it is not
engaged in, and does not intend to engage in, and has no arrangement or
understanding with any Person to participate in, a distribution of the Series B
Notes to be issued in the Exchange Offer and (C) it is acquiring the Series B
Notes in its ordinary course of business. As a condition to its participation in
the Exchange Offer each Holder using the Exchange Offer to participate in a
distribution of the Series B Notes shall acknowledge and agree that, if the
resales are of Series B Notes obtained by such Holder in exchange for Series A
Notes acquired directly from the Company or an Affiliate thereof, it (1) could
not, under Commission policy as in effect on the date of this Agreement, rely on
the position of the Commission enunciated in Morgan Stanley and Co., Inc.
(available June 5, 1991) and Exxon Capital Holdings Corporation (available
May 13, 1988), as interpreted in the Commission’s letter to Shearman & Sterling
dated July 2, 1993, and similar no-action letters (including, if applicable, any
no-action letter obtained pursuant to clause (i) above), and (2) must comply
with the registration and prospectus delivery requirements of the Act, to the
extent applicable, in connection with a secondary resale transaction and that
such a secondary resale transaction must be covered by an effective registration
statement containing the selling security holder information required by
Item 507 or 508, as applicable, of Regulation S-K.
(iii) To the extent required by applicable federal law or Commission policy,
prior to effectiveness of the Exchange Offer Registration Statement, the Company
and the Guarantors shall provide a supplemental letter to the Commission
(A) stating that the Company and the Guarantors are registering the Exchange
Offer in reliance on the position of the Commission enunciated in Exxon Capital
Holdings Corporation (available May 13, 1988), Morgan Stanley and Co., Inc.
(available June 5, 1991) as interpreted in the Commission’s letter to Shearman &
Sterling dated July 2, 1993, and, if applicable, any no-action letter obtained
pursuant to clause (i) above, (B) including a representation that neither the
Company nor any Guarantor has entered into any arrangement or understanding with
any Person to distribute the Series B Notes to be received in the Exchange Offer
and that, to the best of the Company’s and each Guarantor’s information and
belief, each Holder participating in the Exchange Offer is acquiring the
Series B Notes in its ordinary course of business and has no arrangement or
understanding with any Person to participate in the distribution of the Series B
Notes received in the Exchange Offer and (C) any other undertaking or
representation required by the Commission as set forth in any no-action letter
obtained pursuant to clause (i) above, if applicable.
(b) Shelf Registration Statement. In connection with the Shelf Registration
Statement, the Company and the Guarantors shall:
(i) comply with all the provisions of Section 6(c) below and use all
commercially reasonable efforts to effect such registration to permit the sale
of the Transfer Restricted Securities being sold in accordance with the intended
method or methods of distribution thereof (as indicated in the information
furnished to the Company pursuant to Section 4(b) hereof), and pursuant thereto
the Company and the Guarantors will prepare and file with the Commission a
Registration Statement relating to the registration on any appropriate form
under the Act, which form shall be available for the sale of the Transfer
Restricted Securities in accordance with the intended method or methods of
distribution thereof within the time periods and otherwise in accordance with
the provisions hereof, and

 

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(ii) issue, upon the request of any Holder or purchaser of Series A Notes
covered by any Shelf Registration Statement contemplated by this Agreement,
Series B Notes having an aggregate principal amount equal to the aggregate
principal amount of Series A Notes sold pursuant to the Shelf Registration
Statement and surrendered to the Company for cancellation; the Company shall
register Series B Notes on the Shelf Registration Statement for this purpose and
issue the Series B Notes to the purchaser(s) of securities subject to the Shelf
Registration Statement in the names as such purchaser(s) shall designate.
(c) General Provisions. In connection with any Registration Statement (or as
specified below only with respect to a Shelf Registration Statement) and any
related Prospectus required by this Agreement to permit the sale or resale of
Transfer Restricted Securities (including, without limitation, any Registration
Statement and the related Prospectus required to permit resales of Notes by
Broker-Dealers), the Company and the Guarantors shall:
(i) use all commercially reasonable efforts to keep such Registration Statement
continuously effective and provide all requisite financial statements for the
period specified in Section 3 or 4 of this Agreement, as applicable. Upon the
occurrence of any event that would cause any such Registration Statement or the
Prospectus contained therein (in light of the circumstances under which they
were made) (A) to contain an untrue statement of material fact or omit to state
any material fact necessary to make the statements therein not misleading or
(B) not to be effective and usable for resale of Transfer Restricted Securities
during the period required by this Agreement, the Company and the Guarantors
shall file promptly an appropriate amendment to such Registration Statement
curing such defect, and, if Commission review is required, use all commercially
reasonable efforts to cause such amendment to be declared effective as soon as
practicable.
(ii) prepare and file with the Commission such amendments and post-effective
amendments to the applicable Registration Statement as may be necessary to keep
such Registration Statement effective for the applicable period set forth in
Section 3 or 4 hereof, as the case may be; cause the Prospectus to be
supplemented by any required Prospectus supplement, and as so supplemented to be
filed pursuant to Rule 424 under the Act, and to comply fully with Rules 424,
430A and 462, as applicable, under the Act in a timely manner; and comply with
the provisions of the Act with respect to the disposition of all securities
covered by such Registration Statement during the applicable period in
accordance with the intended method or methods of distribution by the sellers
thereof set forth in such Registration Statement or supplement to the
Prospectus;

 

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(iii) advise each Holder promptly and, if requested by such Holder, confirm such
advice in writing, (A) when the Prospectus or any Prospectus supplement or
post-effective amendment has been filed, and, with respect to any applicable
Registration Statement or any post-effective amendment thereto, when the same
has become effective, (B) of any request by the Commission for amendments to the
Registration Statement or amendments or supplements to the Prospectus or for
additional information relating thereto, (C) of the issuance by the Commission
of any stop order suspending the effectiveness of the Registration Statement
under the Act or of the suspension by any state securities commission of the
qualification of the Transfer Restricted Securities for offering or sale in any
jurisdiction, or the initiation of any proceeding for any of the preceding
purposes, (D) of the existence of any fact or the happening of any event that
makes any statement of a material fact made in the Registration Statement, the
Prospectus, any amendment or supplement thereto or any document incorporated by
reference therein untrue, or that requires the making of any additions to or
changes in the Registration Statement in order to make the statements therein
not misleading, or that requires the making of any additions to or changes in
the Prospectus in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. If at any time the
Commission shall issue any stop order suspending the effectiveness of the
Registration Statement, or any state securities commission or other regulatory
authority shall issue an order suspending the qualification or exemption from
qualification of the Transfer Restricted Securities under state securities or
Blue Sky laws, the Company and the Guarantors shall use all commercially
reasonable efforts to obtain the withdrawal or lifting of such order at the
earliest possible time, or file an additional Shelf Registration Statement
pursuant to Rule 415 covering all of the Transfer Restricted Securities covered
by and not sold under the initial Shelf Registration Statement or any earlier
Registration Statement (a “Subsequent Shelf Registration Statement”). If a
Subsequent Shelf Registration Statement is filed, the Company shall use all
commercially reasonable efforts to cause the Subsequent Shelf Registration
Statement to be declared effective as soon as practicable after such filing.
(iv) subject to Section 6(c)(i), if any fact or event contemplated by Section
6(c)(iii)(D) above shall exist or have occurred, prepare a supplement or
post-effective amendment to the Registration Statement or related Prospectus or
any document incorporated therein by reference or file any other required
document so that, as thereafter delivered to the purchasers of Transfer
Restricted Securities, the Prospectus will not contain an untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading;
(v) furnish to each Holder in connection with such exchange or sale, if any,
before filing with the Commission, copies of any Registration Statement or any
Prospectus included therein or any amendments or supplements to any such
Registration Statement or Prospectus (including all documents incorporated by
reference after the initial filing of such Registration Statement), which
documents will be subject to the review and comment of such Holders in
connection with such sale, if any, for a period of at least five Business Days,
and the Company will not file any such Registration Statement or Prospectus or
any amendment or supplement to any such Registration Statement or Prospectus
(including all such documents incorporated by reference) to which such Holders
shall reasonably object within five Business Days after the receipt thereof. A
Holder shall be deemed to have reasonably objected to such filing if such
Registration Statement, amendment, Prospectus or supplement, as applicable, as
proposed to be filed, contains an untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein (in light of
the circumstances under which they were made) not misleading or fails to comply
with the applicable requirements of the Act;

 

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(vi) promptly prior to the filing of any document that is to be incorporated by
reference into a Registration Statement or Prospectus, provide copies of such
document to each Holder in connection with such exchange or sale, if any, make
the Company’s and the Guarantors’ representatives available for discussion of
such document and other customary due diligence matters, and include such
information in such document prior to the filing thereof as such Holders may
reasonably request;
(vii) with respect to a Shelf Registration Statement, make available, at
reasonable times, for inspection by each selling Holder, any underwriter(s)
participating in any disposition pursuant to a Shelf Registration Statement and
any attorney or accountant retained by such selling Holders, or any such
underwriter(s), all financial and other records, pertinent corporate documents
of the Company and the Guarantors and cause the Company’s and the Guarantors’
officers, directors and employees to supply all information reasonably requested
by any such Holder, attorney or accountant in connection with such Registration
Statement or any post-effective amendment thereto subsequent to the filing
thereof and prior to its effectiveness;
(viii) with respect to a Shelf Registration Statement, if requested by any
selling Holders in connection with such exchange or sale of the underwriter(s),
if any, promptly include in any Registration Statement or Prospectus, pursuant
to a supplement or post-effective amendment if necessary, such information as
such selling Holders may reasonably request to have included therein, including,
without limitation, information relating to the “Plan of Distribution” of the
Transfer Restricted Securities; and make all required filings of such Prospectus
supplement or post-effective amendment as soon as practicable after the Company
is notified of the matters to be included in such Prospectus supplement or
post-effective amendment;
(ix) with respect to a Shelf Registration Statement, furnish to each selling
Holder in connection with such exchange or sale and each underwriter, if any,
without charge, at least one copy of the Registration Statement, as first filed
with the Commission, and of each amendment thereto, including all documents
incorporated by reference therein and all exhibits (including exhibits
incorporated therein by reference);
(x) with respect to a Shelf Registration Statement, deliver to each selling
Holder and each underwriter, if any, without charge, as many copies of the
Prospectus (including each preliminary prospectus) and any amendment or
supplement thereto as such Persons reasonably may request; the Company and the
Guarantors hereby consent to the use (in accordance with law) of the Prospectus
and any amendment or supplement thereto by each selling Holder and each
underwriter, if any, in connection with the offering and the sale of the
Transfer Restricted Securities covered by the Prospectus or any amendment or
supplement thereto;

 

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(xi) upon the request of any Holders or Holder of an aggregate principal amount
of at least 33% of the outstanding principal amount of Transfer Restricted
Securities, enter into such agreements (including underwriting agreements) and
make such customary representations and warranties and take all such other
customary actions in connection therewith in order to expedite or facilitate the
disposition of the Transfer Restricted Securities pursuant to any applicable
Registration Statement contemplated by this Agreement as may be reasonably
requested by any Holders or Holder of an aggregate principal amount of at least
33% of the outstanding principal amount of Transfer Restricted Securities, in
connection with any sale or resale pursuant to any applicable Registration
Statement. In such connection, the Company and the Guarantors shall:
(A) upon request of any Holders or Holder of an aggregate principal amount of at
least 33% of Transfer Restricted Securities, furnish (or in the case of
paragraphs (2) and (3), use all commercially reasonable efforts to cause to be
furnished) to each Holder, upon Consummation of the Exchange Offer or upon the
effectiveness of the Shelf Registration Statement, as the case may be:
(1) a certificate, dated such date, signed on behalf of the Company and each
Guarantor by (x) the President or any Vice President and (y) a principal
financial or accounting officer of the Company and such Guarantor, confirming,
as of the date thereof, the matters set forth in Sections 8(c), 8(d) and 8(e)(i)
of the Purchase Agreement and such other similar matters as such Holders may
reasonably request;
(2) an opinion, dated the date of Consummation of the Exchange Offer or the date
of effectiveness of the Shelf Registration Statement, as the case may be, of
counsel for the Company and the Guarantors covering matters similar to those set
forth in Exhibit A to the Purchase Agreement and such other matter as such
Holders may reasonably request, and in any event including a statement to the
effect that such counsel has participated in conferences with officers of the
Company, representatives of the independent certified public accountants of the
Company, and representatives of the Initial Purchaser and its counsel, at which
conferences the contents of the Registration Statement and related matters were
discussed and, although we have not independently verified and are not passing
upon and assume no responsibility for the accuracy, completeness or fairness of
the statements contained in the Registration Statement and any related
Prospectus, on the basis of the foregoing, nothing has come to our attention
that causes us to believe that, as of the date of its effectiveness, the
Registration Statement or any related Prospectus contained or contains, an
untrue statement of a material fact or omitted or omits to state a material fact
necessary to make the statements contained therein, in the light of the
circumstances under which they were made, not misleading (it being understood
that we express no view or opinion with respect to the financial statements and
notes thereto or other financial or accounting data included in the Registration
Statement or any related Prospectus); and

 

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(3) a customary comfort letter, dated the date of Consummation of the Exchange
Offer, or as of the date of effectiveness of the Shelf Registration Statement,
as the case may be, from the Company’s independent accountants, in the customary
form and covering matters of the type customarily covered in comfort letters to
underwriters in connection with underwritten offerings, and affirming the
matters set forth in the comfort letters delivered pursuant to Sections 8(h) and
8(i) of the Purchase Agreement; and
(B) deliver such other documents and certificates as may be reasonably requested
by the selling Holders to evidence compliance with the matters covered in clause
(A) above and with any customary conditions contained in the any agreement
entered into by the Company and the Guarantors pursuant to this clause (xi);
(xii) prior to any public offering of Transfer Restricted Securities, cooperate
with the selling Holders and their counsel in connection with the registration
and qualification of the Transfer Restricted Securities under the securities or
Blue Sky laws of such jurisdictions as the selling Holders may request and do
any and all other acts or things necessary or advisable to enable the
disposition in such jurisdictions of the Transfer Restricted Securities covered
by the applicable Registration Statement; provided, however, that neither the
Company nor any Guarantor shall be required to register or qualify as a foreign
corporation where it is not now so qualified or to take any action that would
subject it to the service of process in suits or to taxation, other than as to
matters and transactions relating to the Registration Statement, in any
jurisdiction where it is not now so subject;
(xiii) in connection with any sale of Transfer Restricted Securities that will
result in such securities no longer being Transfer Restricted Securities,
cooperate with the Holders to facilitate the timely preparation and delivery of
certificates representing Transfer Restricted Securities to be sold and not
bearing any restrictive legends; and to register such Transfer Restricted
Securities in such denominations and such names as the selling Holders may
request at least two Business Days prior to such sale of Transfer Restricted
Securities;
(xiv) shall issue, upon the request of any Holder of Series A Notes or Private
Series B Notes covered by the Shelf Registration Statement, Series B Notes,
having an aggregate principal amount equal to the aggregate principal amount of
Series A Notes surrendered to the Company by such Holder in exchange therefor or
being sold by such Holder; such Series B Notes to be registered in the name of
such Holder or in the name of the purchaser(s) of such Notes, as the case may
be; in return, the Series A Notes held by such Holder shall be surrendered to
the Company for cancellation;
(xv) use all commercially reasonable efforts to cause the disposition of the
Transfer Restricted Securities covered by the Registration Statement to be
registered with or approved by such other governmental agencies or authorities
as may be necessary to enable the seller or sellers thereof to consummate the
disposition of such Transfer Restricted Securities, subject to the proviso
contained in clause (xii) above;

 

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(xvi) provide a CUSIP number for all Transfer Restricted Securities not later
than the effective date of a Registration Statement covering such Transfer
Restricted Securities and provide the Trustee under the Indenture with printed
certificates for the Transfer Restricted Securities which are in a form eligible
for deposit with the Depository Trust Company;
(xvii) cooperate and assist in any filings required to be made with the FINRA
and in the performance of any due diligence investigation by any underwriter
(including any “qualified independent underwriter”) that is required to be
retained in accordance with the rules and regulations of FINRA;
(xviii) otherwise use all commercially reasonable efforts to comply with all
applicable rules and regulations of the Commission, and make generally available
to its security holders with regard to any applicable Registration Statement, as
soon as practicable, a consolidated earnings statement meeting the requirements
of Rule 158 (which need not be audited) covering a twelve-month period
(A) commencing at the end of any fiscal quarter in which Transfer Restricted
Securities are sold to underwriters in a firm or best efforts Underwritten
Offering or (B) if not sold to underwriters in such an offering, beginning with
the first month of the Company’s first fiscal quarter commencing after the
effective date of the Registration Statement;
(xix) cause the Indenture to be qualified under the TIA not later than the
effective date of the first Registration Statement required by this Agreement
and, in connection therewith, cooperate with the Trustee and the Holders to
effect such changes to the Indenture as may be required for such Indenture to be
so qualified in accordance with the terms of the TIA; and execute and use all
commercially reasonable efforts to cause the Trustee to execute, all documents
that may be required to effect such changes and all other forms and documents
required to be filed with the Commission to enable such Indenture to be so
qualified in a timely manner;
(xx) provide promptly to each Holder, upon request, each document filed with the
Commission pursuant to the requirements of Section 13 or Section 15(d) of the
Exchange Act;
(xxi) permit Holders to withdraw tendered Series A Notes at any time prior to
the close of business, New York time, on the last Business Day on which the
Exchange Offer shall remain open;
(xxii) utilize the services of a depositary for the Exchange Offer with an
address in the Borough of Manhattan, The City of New York, which may be the
Trustee or an affiliate of the Trustee; and
(xxiii) use all commercially reasonable efforts to cause the Transfer Restricted
Securities covered by a Registration Statement to be rated with such appropriate
rating agencies, if so requested in writing by the Holders of a majority in
aggregate principal amount of the Transfer Restricted Securities covered by such
Registration Statement or the managing underwriter or underwriters, if any.

 

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(d) Restrictions on Holders. Each selling Holder agrees by acquisition of a
Transfer Restricted Security that, upon receipt of the notice referred to in
Section 6(c)(iii)(C) or any notice from the Company of the existence of any fact
of the kind described in Section 6(c)(iii)(D) hereof (in each case, a
“Suspension Notice”), such selling Holder will forthwith discontinue disposition
of Transfer Restricted Securities pursuant to the applicable Registration
Statement and will use its commercially reasonably efforts to cause any
underwriter to forthwith discontinue disposition of Transfer Restricted
Securities pursuant to the applicable Registration Statement until (i) such
selling Holder has received copies of the supplemented or amended Prospectus
contemplated by Section 6(c)(iv) hereof, or (ii) such selling Holder is advised
in writing by the Company that the use of the Prospectus may be resumed, and has
received copies of any additional or supplemental filings that are incorporated
by reference in the Prospectus (in each case, the “Recommencement Date”). Each
selling Holder receiving a Suspension Notice hereby agrees that it will either
(i) destroy any Prospectuses, other than permanent file copies, then in such
Holder’s possession which have been replaced by the Company with more recently
dated Prospectuses or (ii) deliver to the Company (at the Company’s expense) all
copies, other than permanent file copies, then in such selling Holder’s
possession of the Prospectus covering such Transfer Restricted Securities that
was current at the time of receipt of the Suspension Notice. The time period
regarding the effectiveness of such Registration Statement set forth in
Section 3 or 4 hereof, as applicable, shall be extended by a number of days
equal to the number of days in the period from and including the date of
delivery of the Suspension Notice to and including the Recommencement Date.
Notwithstanding anything herein to the contrary, any party to this Agreement
(and any employee, representative, or other agent of any party to this
Agreement) may disclose to any and all Persons, without limitation of any kind,
the U.S. federal income tax treatment and tax structure of the transactions
contemplated by this Agreement (the “Transactions”) and all materials of any
kind (including opinions or other tax analyses) that are provided to it relating
to such tax treatment and tax structure; provided, however, that neither party
(nor any employee, representative or other agent thereof) shall disclose any
information (a) that is not relevant to an understanding of the U.S. federal
income tax treatment or tax structure of the Transactions or (b) to the extent
such disclosure could result in a violation of any federal or state securities
laws.
SECTION 7. REGISTRATION EXPENSES
(a) All expenses incident to the Company’s and the Guarantors’ performance of or
compliance with this Agreement will be borne by the Company, regardless of
whether a Registration Statement becomes effective, including without
limitation: (i) all registration and filing fees and expenses; (ii) all fees and
expenses of compliance with federal securities and state Blue Sky or securities
laws; (iii) all expenses of printing (including printing certificates for the
Series B Notes to be issued in the Exchange Offer and Private Series B Notes to
be issued in the Private Exchange, if any, and printing of Prospectuses),
messenger and delivery services and telephone; (iv) all fees and disbursements
of counsel for the Company and the Guarantors; (v) all reasonable fees and
disbursements of one counsel (and in addition any local counsel) as selected by
Holders of a majority in aggregate principal amount of Transfer Restricted
Securities; (vi) all application and filing fees in connection with listing the
Series B Notes on a national securities exchange or automated quotation system
pursuant to the requirements hereof; (vii) all reasonable fees and disbursements
of independent certified public accountants of the Company and the Guarantors
(including the expenses of any special audit and comfort letters required by or
incident to such performance), and (viii) rating agency fees.

 

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The Company will, in any event, bear its and the Guarantors’ internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), the expenses of any annual
audit and the fees and expenses of any Person, including special experts,
retained by the Company or the Guarantors.
(b) In connection with any Registration Statement required by this Agreement
(including, without limitation, the Exchange Offer Registration Statement and
the Shelf Registration Statement), the Company and the Guarantors will reimburse
the Initial Purchaser and the Holders of Transfer Restricted Securities who are
tendering Series A Notes into in the Exchange Offer and/or selling or reselling
Series A Notes or Series B Notes pursuant to the “Plan of Distribution”
contained in the Exchange Offer Registration Statement or the Shelf Registration
Statement, as applicable, for the reasonable fees and disbursements of not more
than one counsel, who shall be Proskauer Rose LLP, unless another firm shall be
chosen by the Holders of a majority in principal amount of the Transfer
Restricted Securities for whose benefit such Registration Statement is being
prepared.
SECTION 8. INDEMNIFICATION
(a) The Company and the Guarantors agree, jointly and severally, to indemnify
and hold harmless each Holder, its directors, officers and each Person, if any,
who controls such Holder (within the meaning of Section 15 of the Act or
Section 20 of the Exchange Act), from and against any and all losses, claims,
damages, liabilities, judgments, (including without limitation, any legal or
other expenses incurred in connection with investigating or defending any
matter, including any action that could give rise to any such losses, claims,
damages, liabilities or judgments) caused by any untrue statement or alleged
untrue statement of a material fact contained in any Registration Statement,
preliminary prospectus or Prospectus (or any amendment or supplement thereto)
provided by the Company to any Holder or any prospective purchaser of Series B
Notes or registered Series A Notes, or caused by any omission or alleged
omission to state therein 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, provided, however, that the Company and
the Guarantors shall not be liable in any such case to the extent that such
losses, claims, damages, liabilities or judgments are caused by an untrue
statement or omission or alleged untrue statement or omission that is based upon
information relating to any of the Holders furnished in writing to the Company
by any of the Holders, provided, further, that with respect to any untrue
statement or alleged untrue statement of a material fact or omission or alleged
omission of material fact in the Registration Statement, the preliminary
Prospectus or Prospectus, the indemnity contained in this Section 8 shall not
inure to the benefit of any Holder to the extent that such loss, claim, damage,
liability or judgment results solely from an untrue statement of a material fact
contained in, or the omission of a material fact from, any Registration
Statement, preliminary Prospectus or Prospectus, which untrue statement or
omission was completely corrected in the Prospectus as amended or supplemented
if it shall have been determined by a court of competent jurisdiction that
(1) such Holder sold the Series B Notes or registered Series A Notes to the
Person alleging such loss, claim, damage or liability and failed to send or
give, at or prior to the written confirmation of such sale, a copy of the
Prospectus as amended or supplemented, if required by applicable law to have so
delivered it, and (2) the Company had previously furnished copies of the
corrected Prospectus as amended or supplemented to such Holder within a
reasonable amount of time prior to such sale or such written confirmation, and
(3) the corrected Prospectus as amended or supplemented, if delivered would have
been a complete defense against the Person asserting such loss, claim, damage or
liability.

 

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(b) Each Holder of Transfer Restricted Securities agrees, severally and not
jointly, to indemnify and hold harmless the Company and the Guarantors, and
their respective directors and officers, and each Person, if any, who controls
(within the meaning of Section 15 of the Act or Section 20 of the Exchange Act)
the Company, or the Guarantors to the same extent as the foregoing indemnity
from the Company and the Guarantors set forth in section (a) above, but only
with reference to information relating to such Holder furnished in writing to
the Company by such Holder expressly for use in any Registration Statement. In
no event shall any Holder, its directors, officers or any Person who controls
such Holder be liable or responsible for any amount in excess of the amount by
which the total amount received by such Holder with respect to its sale of
Transfer Restricted Securities pursuant to a Registration Statement exceeds
(i) the amount paid by such Holder for such Transfer Restricted Securities and
(ii) the amount of any damages that such Holder, its directors, officers or any
Person who controls such Holder has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged omission.
(c) In case any action shall be commenced involving any person in respect of
which indemnity may be sought pursuant to Section 8(a) or 8(b) (the “indemnified
party”), the indemnified party shall promptly notify the person against whom
such indemnity may be sought (the “indemnifying person”) in writing and the
indemnifying party shall have the right, exercisable by giving written notice to
any indemnified party within 20 Business Days after receipt of such notice by
such indemnified party of such action, to assume, at their expense the defense
of such action. Any indemnified party 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 the indemnified party
unless (i) the employment of such counsel shall have been specifically
authorized in writing by the indemnifying party, (ii) the indemnifying party
shall have failed to assume the defense of such action or employ counsel
reasonably satisfactory to the indemnified party or (iii) the named parties to
any such action (including any impleaded parties) include both the indemnified
party and the indemnifying party, and the indemnified party shall have been
advised by such counsel that there may be one or more legal defenses available
to it which are different from or additional to those available to the
indemnifying party (in which case the indemnifying party shall not have the
right to assume the defense of such action on behalf of the indemnified party).
In any such case, the indemnifying party shall not, in connection with any one
action or separate but substantially similar or related actions in the same
jurisdiction arising out of the same general allegations or circumstances, 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 and all such fees and
expenses shall be reimbursed as they are incurred. Such firm shall be designated
in writing by a majority of the Holders, in the case of the parties indemnified
pursuant to Section 8(a), and by the Company and Guarantors, in the case of
parties indemnified pursuant to Section 8(b). The indemnifying party shall
indemnify and hold harmless the indemnified party from and against any and all
losses, claims, damages, liabilities and judgments by reason of any settlement
of any action effected with its written consent and no indemnifying party shall
be liable for any settlement effected without its written consent. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any settlement or compromise of, or consent to the entry of
judgment with respect to, any pending or threatened action in respect of which
the indemnified party is or could have been a party and indemnity or
contribution may be or could have been sought hereunder by the indemnified
party, unless such settlement, compromise or judgment (i) includes an
unconditional release of the indemnified party from all liability on claims that
are or could have been the subject matter of such action and (ii) does not
include a statement as to or an admission of fault, culpability or a failure to
act, by or on behalf of the indemnified party.

 

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(d) To the extent that the indemnification provided for in this Section 8 is
unavailable to an indemnified party in respect of any losses, claims, damages,
liabilities or judgments referred to therein, 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 or judgments (i) in such proportion as is appropriate to
reflect the relative benefits received by the Company and the Guarantors, on the
one hand, and the Holders, on the other hand, from their sale of Transfer
Restricted Securities or (ii) if the allocation provided by clause 8(d)(i) is
not permitted by applicable law, in such proportion as is appropriate to reflect
not only the relative benefits referred to in clause 8(d)(i) above but also the
relative fault of the Company and the Guarantors, on the one hand, and of the
Holder, 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 Company
and the Guarantors, on the one hand, and of the Holder, on the other hand, shall
be determined by reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged omission to state
a material fact relates to information supplied by the Company or such
Guarantor, on the one hand, or by the Holder, on the other hand, and the
parties’ relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The amount paid or payable by a
party as a result of the losses, claims, damages, liabilities and judgments
referred to above shall be deemed to include, subject to the limitations set
forth in the second paragraph of Section 8(a), any legal or other fees or
expenses reasonably incurred by such party in connection with investigating or
defending any action or claim.
The Company, the Guarantors and each Holder 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 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 matter, including any
action that could have given rise to such losses, claims, damages, liabilities
or judgments. Notwithstanding the provisions of this Section 8, no Holder, its
directors, its officers or any Person, if any, who controls such Holder shall be
required to contribute, in the aggregate, any amount in excess of the amount by
which the total received by such Holder with respect to the sale of Transfer
Restricted Securities pursuant to a Registration Statement exceeds (i) the
amount paid by such Holder for such Transfer Restricted Securities and (ii) the
amount of any damages which such Holder has otherwise been required to pay by
reason of such untrue or alleged untrue statement or omission or alleged
omission. No person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. The Holders’
obligations to contribute pursuant to this Section 8(c) are several in
proportion to the respective principal amount of Transfer Restricted Securities
held by each Holder hereunder and not joint.

 

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SECTION 9. RULE 144A AND RULE 144
The Company and each Guarantor agrees with each Holder, for so long as any
Transfer Restricted Securities remain outstanding and during any period in which
the Company or such Guarantor (i) is not subject to Section 13 or 15(d) of the
Exchange Act, to make available, upon request of any Holder, to such Holder or
beneficial owner of Transfer Restricted Securities in connection with any sale
thereof and any prospective purchaser of such Transfer Restricted Securities
designated by such Holder or beneficial owner, the information required by
Rule 144A(d)(4) under the Act in order to permit resales of such Transfer
Restricted Securities pursuant to Rule 144A, and (ii) is subject to Section 13
or 15 (d) of the Exchange Act, to make all filings required thereby in a timely
manner in order to permit resales of such Transfer Restricted Securities
pursuant to Rule 144.
SECTION 10. MISCELLANEOUS
(a) Remedies. The Company and the Guarantors acknowledge and agree that any
failure by the Company and/or the Guarantors to comply with their respective
obligations under Sections 3 and 4 hereof may result in material irreparable
injury to the Initial Purchaser or the Holders for which there is no adequate
remedy at law, that it will not be possible to measure damages for such injuries
precisely and that, in the event of any such failure, the Initial Purchaser or
any Holder may obtain such relief as may be required to specifically enforce the
Company’s and the Guarantor’s obligations under Sections 3 and 4 hereof. The
Company and the Guarantors further agree to waive the defense in any action for
specific performance that a remedy at law would be adequate.
(b) No Inconsistent Agreements. Neither the Company nor any Guarantor will, on
or after the date of this Agreement, enter into any agreement with respect to
its securities that is inconsistent with the rights granted to the Holders in
this Agreement or otherwise conflicts with the provisions hereof. Neither the
Company nor any Guarantor has previously entered into any agreement granting any
registration rights with respect to its securities to any Person other than that
certain Registration Rights Agreement, dated as of March 31, 2004, by and among
the Company, the guarantors party thereto, the Initial Purchaser and Deutsche
Bank Securities Inc. The rights granted to the Holders hereunder do not in any
way conflict with and are not inconsistent with the rights granted to the
holders of the Company’s and the Guarantors’ securities under any agreement in
effect on the date hereof.

 

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(c) Amendments and Waivers. The provisions of this Agreement may not be amended,
modified or supplemented, and waivers or consents to or departures from the
provisions hereof may not be given unless (i) in the case of Section 5 and 8
hereof and this Section 10(c)(i), the Company has obtained the written consent
of Holders of all outstanding Transfer Restricted Securities and (ii) in the
case of all other provisions hereof, the Company has obtained the written
consent of Holders of a majority of the outstanding principal amount of Transfer
Restricted Securities. Notwithstanding the foregoing, a waiver or consent to
departure from the provisions hereof that relates exclusively to the rights of
Holders whose Transfer Restricted Securities are being tendered pursuant to the
Exchange Offer, and that does not affect directly or indirectly the rights of
other Holders whose Transfer Restricted Securities are not being tendered
pursuant to such Exchange Offer, may be given by the Holders of a majority of
the outstanding principal amount of Transfer Restricted Securities subject to
such Exchange Offer.
(d) Third Party Beneficiary. The Holders shall be third party beneficiaries to
the agreements made hereunder between the Company and the Guarantors, on the one
hand, and the Initial Purchaser, on the other hand, and shall have the right to
enforce such agreements directly to the extent they may deem such enforcement
necessary or advisable to protect its rights or the rights of Holders hereunder.
(e) Notices. All notices and other communications provided for or permitted
hereunder shall be made in writing by hand-delivery, first-class mail
(registered or certified, return receipt requested), telex, telecopier, e-mail
or air courier guaranteeing overnight delivery:
(i) if to a Holder, at the address set forth on the records of the Registrar
under the Indenture, with a copy to the Registrar under the Indenture and with a
copy to:
Proskauer Rose LLP
2049 Century Park East
Los Angeles, CA 90067
Telecopier No.: (310) 557-2193
E-mail: mworonoff@proskauer.com and mshilling@proskauer.com
Attention: Michael Woronoff and Monica Shilling; and
(ii) if to the Company or the Guarantors:
Real Mex Restaurants, Inc.
5660 Katella Avenue, Suite 100
Cypress, CA 90630
Telecopier No.: (562) 346-1465
E-mail: steve.tanner@realmexrestaurants.com
Attention: Steven Tanner

 

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With a copy to:
Loeb & Loeb LLP
10100 Santa Monica Blvd., Suite 2200
Los Angeles, CA 90067
Telecopier No.: (310) 919-3970
E-mail: gchizever@loeb.com
Attention: Jerry Chizever
All such notices and communications shall be deemed to have been duly given: at
the time delivered by hand, if personally delivered; five Business Days after
being deposited in the mail, postage prepaid, if mailed; when receipt
acknowledged, if telecopied or e-mailed; and on the next Business Day, if timely
delivered to an air courier guaranteeing overnight delivery.
Copies of all such notices, demands or other communications shall be
concurrently delivered by the Person giving the same to the Trustee at the
address specified in the Indenture.
(f) Successors and Assigns. This Agreement shall inure to the benefit of and be
binding upon the successors and assigns of each of the parties, including
without limitation and without the need for an express assignment, subsequent
Holders; provided, that nothing herein shall be deemed to permit any assignment,
transfer or other disposition of Transfer Restricted Securities in violation of
the terms hereof or of the Purchase Agreement or the Indenture. If any
transferee of any Holder shall acquire Transfer Restricted Securities in any
manner, whether by operation of law or otherwise, such Transfer Restricted
Securities shall be held subject to all of the terms of this Agreement, and by
taking and holding such Transfer Restricted Securities such Person shall be
conclusively deemed to have agreed to be bound by and to perform all of the
terms and provisions of this Agreement, including the restrictions on resale set
forth in this Agreement and, if applicable, the Purchase Agreement, and such
Person shall be entitled to receive the benefits hereof.
(g) Counterparts. This Agreement may be executed in any number of counterparts
and by the parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which taken together shall
constitute one and the same agreement.
(h) Headings. The headings in this Agreement are for convenience of reference
only and shall not limit or otherwise affect the meaning hereof.
(i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE
CONFLICT OF LAW RULES THEREOF TO THE EXTENT SUCH LAWS WOULD CAUSE THE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.

 

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(j) Venue. EACH PARTY HERETO HEREBY EXPRESSLY AND IRREVOCABLY (I) SUBMITS TO THE
NON-EXCLUSIVE JURISDICTION OF THE FEDERAL AND STATE COURTS SITTING IN THE
BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN ANY SUIT OR PROCEEDING ARISING
OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY;
AND (II) WAIVES (A) THEIR RESPECTIVE RIGHTS TO A TRIAL BY JURY IN ANY LEGAL
ACTION OR PROCEEDING RELATING TO THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED
HEREBY, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL
OR WRITTEN) OR ACTIONS OF THE INITIAL PURCHASER AND FOR ANY COUNTERCLAIM RELATED
TO ANY OF THE FOREGOING AND (B) ANY OBJECTION WHICH THEY MAY HAVE OR HEREAFTER
MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT
REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM.
(j) Severability. In the event that any one or more of the provisions contained
herein, or the application thereof in any circumstance, is held invalid, illegal
or unenforceable, the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions contained
herein shall not be affected or impaired thereby.
(k) Entire Agreement. This Agreement is intended by the parties as a final
expression of their agreement and intended to be a complete and exclusive
statement of the agreement and understanding of the parties hereto in respect of
the subject matter contained herein. There are no restrictions, promises,
warranties or undertakings, other than those set forth or referred to herein
with respect to the registration rights granted with respect to the Transfer
Restricted Securities. This Agreement supersedes all prior agreements and
understandings between the parties with respect to such subject matter.
(l) Securities Held by the Company or Its Affiliates. Whenever the consent or
approval of Holders of a specified percentage of Transfer Restricted Securities
is required hereunder, Transfer Restricted Securities held by the Company or its
Affiliates shall not be counted in determining whether such consent or approval
was given by the Holders of such required percentage.

 

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first written above.

            REAL MEX RESTAURANTS, INC.
      By:           Name:   Steven L. Tanner        Title:   Chief Financial
Officer        RM RESTAURANT HOLDING CORP.
      By:           Name:   Steven L. Tanner        Title:   Chief Financial
Officer        ACAPULCO MARK CORP.
      By:           Name:   Steven L. Tanner        Title:   Chief Financial
Officer        ACAPULCO RESTAURANT OF DOWNEY, INC.
    By:           Name:   Steven L. Tanner        Title:   Chief Financial
Officer        ACAPULCO RESTAURANT OF MORENO VALLEY, INC.
      By:           Name:   Steven L. Tanner        Title:   Chief Financial
Officer        ACAPULCO RESTAURANT OF VENTURA, INC.
      By:           Name:   Steven L. Tanner        Title:   Chief Financial
Officer   

 

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            ACAPULCO RESTAURANT OF WESTWOOD, INC.
      By:           Name:   Steven L. Tanner        Title:   Chief Financial
Officer        ACAPULCO RESTAURANTS, INC.
      By:           Name:   Steven L. Tanner        Title:   Chief Financial
Officer        ALA DESIGN, INC.
      By:           Name:   Steven L. Tanner        Title:   Chief Financial
Officer        CHEVYS RESTAURANTS, LLC.
      By:           Name:   Steven L. Tanner        Title:   Chief Financial
Officer        CKR ACQUISITION CORP.
      By:           Name:   Steven L. Tanner        Title:   Chief Financial
Officer        EL PASO CANTINA, INC.
      By:           Name:   Steven L. Tanner        Title:   Chief Financial
Officer        EL TORITO FRANCHISING COMPANY
      By:           Name:   Steven L. Tanner        Title:   Chief Financial
Officer   

 

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            EL TORITO RESTAURANTS, INC.
      By:           Name:   Steven L. Tanner        Title:   Chief Financial
Officer        MURRAY PACIFIC
      By:           Name:   Steven L. Tanner        Title:   Chief Financial
Officer        REAL MEX FOODS, INC.
      By:           Name:   Steven L. Tanner        Title:   Chief Financial
Officer        TARV, INC.
      By:           Name:   Steven L. Tanner        Title:   Chief Financial
Officer   

 

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            JEFFERIES & COMPANY, INC.
      By:           Name:   Christian Morris        Title:   Managing Director 
 

 

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