Exhibit
4.9


 


EXECUTION
COPY


 


$300,000,000


 


SEMCO
ENERGY, INC.


 


71/8  % Senior
Notes due 2008


73⁄4%
Senior Notes due 2013


 


 


REGISTRATION
RIGHTS AGREEMENT


 


 


May 15, 2003


 


Credit Suisse First Boston LLC


McDonald Investments Inc.


ABN AMRO Incorporated


US Bancorp Piper Jaffray Inc.


NatCity Investments, Inc.


c/o Credit Suisse First Boston LLC


Eleven Madison Avenue


New York, New York
10010-3629


 


Dear Sirs:


 


SEMCO Energy, Inc., a Michigan corporation (the “Company”), proposes to issue and sell to, and if applicable, exchange
with, Credit Suisse First Boston LLC, McDonald Investments Inc., ABN AMRO
Incorporated, US Bancorp Piper Jaffray Inc. and NatCity Investments, Inc.
(collectively, the “Initial Purchasers”),
upon the terms set forth in a purchase agreement dated May 14, 2003 (the “CSFB
Purchase Agreement”), $94,641,000 aggregate principal amount of its
73⁄4% Senior Notes due 2013 (the “2013
Securities”) and a purchase agreement dated May 14, 2003 (the “Other
Purchase Agreement”, and together with the CSFB Purchase Agreement,
the “Purchase
Agreements”), $150,000,000 aggregate principal amount of its 71/8  %
Senior Notes due 2008 (the “2008 Securities”, and together with the
2013 Securities, to the extent such 2013 Securities and 2008 Securities are
issued pursuant to the 2013 Indenture and the 2008 Indenture, respectively, the
“Initial
Securities”) and  $55,359,000
aggregate principal amount of its 2013 Securities.  The 2008 Securities will be issued pursuant to an Indenture, to
be dated as of the date of the initial issuance of the 2008 Securities (the “2008
Indenture”), between the Company and Fifth Third Bank, a Michigan
banking corporation, as trustee  (the “2008 Trustee”).  The 2013 Securities will be issued pursuant
to an Indenture, dated the date hereof (the “2013 Indenture”, and together
with the 2008 Indenture, the “Indentures”), between the Company and Fifth
Third Bank, a Michigan banking corporation, as trustee (the “2013
Trustee,” and together with the 2008 Trustee, the “Trustees”).  Capitalized terms used herein and not
otherwise defined shall have the meanings assigned to them in the
Indentures.  As an inducement to the
Initial Purchasers to enter into the Purchase Agreement, the Company agrees
with the Initial Purchasers, for the benefit of the Initial Purchasers and the
holders of the Securities (as defined below) (collectively the “Holders”), as follows:


 


1.  Registered Exchange Offer.  Unless not permitted by applicable law
(after the Company and the Guarantors, if any, have complied with the ultimate
paragraph of this Section 1), the Company and the Guarantors, if any,
shall prepare and, not later than 90 days (such 90th day being a “Filing Deadline”) after the date on which
the Initial Purchasers purchase and, to the extent applicable, exchange for,
the Initial Securities pursuant to the Purchase Agreement (the “Closing Date”), file with the Securities
and Exchange Commission (the “Commission”)
a registration statement (the “Exchange Offer
Registration Statement”) on an appropriate form under the Securities
Act of 1933, as amended (the “Securities Act”),
with respect to a proposed offer (the “Registered
Exchange Offer”) to the Holders of Transfer Restricted


 

















 


Securities (as defined in Section 6 hereof), who are not
prohibited by any law or policy of the Commission from participating in the
Registered Exchange Offer, to issue and deliver to such Holders, in exchange
for (a) the 2008 Securities, a like aggregate principal amount of debt
securities of the Company issued under the 2008 Indenture, identical in all
material respects to the 2008 Securities and registered under the Securities
Act (the “2008
Exchange Securities”) and (b) the 2013 Securities, a like aggregate
principal amount of debt securities of the Company issued under the 2013
Indenture, identical in all material respects to the 2013 Securities and
registered under the Securities Act (the “2013 Exchange Securities” and, together
with the 2008 Exchange Securities, the “Exchange Securities”).  The Company and the Guarantors, if any,
shall use their respective reasonable best efforts to (i) cause such Exchange
Offer Registration Statement to become effective under the Securities Act
within 180 days after the Closing Date (such 180th day being an “Effectiveness Deadline”) and (ii) keep the
Exchange Offer Registration Statement effective for not less than 30 days
(or longer, if required by applicable law) after the date notice of the
Registered Exchange Offer is mailed to the Holders (such period being called
the “Exchange Offer Registration Period”).  The Initial Securities and the Exchange
Securities are herein collectively called the “Securities.”


 


If the Company commences the Registered Exchange
Offer, the Company and the Guarantors, if any, shall use their respective
reasonable best efforts to consummate the Registered Exchange Offer no later
than 30 business days (or longer, if required by the federal securities laws)
after the date on which the Exchange Offer Registration Statement is declared
effective (such 30th day being the “Consummation
Deadline”).


 


Following the declaration of the effectiveness of the
Exchange Offer Registration Statement, the Company and the Guarantors, if any,
shall promptly commence the Registered Exchange Offer, it being the objective
of such Registered Exchange Offer to enable each Holder of Transfer Restricted
Securities electing to exchange the Transfer Restricted Securities for Exchange
Securities (assuming that such Holder is not an affiliate of the Company within
the meaning of the Securities Act, acquires the Exchange Securities in the
ordinary course of such Holder’s business and has no arrangements with any
person to participate in the distribution of the Exchange Securities and is not
prohibited by any law or policy of the Commission from participating in the
Registered Exchange Offer) to trade such Exchange Securities from and after
their receipt without any limitations or restrictions under the Securities Act
and without material restrictions under the securities laws of the several
states of the United States.


 


The Company acknowledges that, pursuant to current
interpretations by the Commission’s staff of Section 5 of the Securities
Act, in the absence of an applicable exemption therefrom, (i) each Holder that
is a broker-dealer electing to exchange Initial Securities, acquired for its
own account as a result of market-making activities or other trading
activities, for Exchange Securities (an “Exchanging
Dealer”), is required to deliver a prospectus containing the
information set forth in (a) Annex A hereto on the cover, (b) Annex B hereto in
the “Exchange Offer Procedures” section and the “Purpose of the Exchange Offer”
section, and (c) Annex C hereto in the “Plan of Distribution” section of such
prospectus in connection with a sale of any such Exchange Securities received
by such Exchanging Dealer pursuant to the Registered Exchange Offer and (ii) an
Initial Purchaser that elects to sell Securities (as defined below) acquired in
exchange for Initial Securities constituting any portion of an unsold
allotment, is required to deliver a prospectus containing the information
required by Items 507 or 508 of Regulation S-K under the Securities Act, as
applicable, in connection with such sale.


 


The Company and the Guarantors, if any, shall use
their respective reasonable best efforts to keep the Exchange Offer
Registration Statement effective and to amend and supplement the prospectus
contained therein, in order to permit such prospectus to be lawfully delivered
by all persons subject to the prospectus delivery requirements of the
Securities Act for such period of time as such persons must comply with such
requirements in order to resell the Exchange Securities; provided, however,
that (i) in the case where such prospectus and any amendment or supplement
thereto must be delivered by an Exchanging Dealer or an Initial Purchaser, such
period shall be the lesser of 180 days and the date on which all
Exchanging Dealers and the Initial Purchasers have sold all Exchange Securities
held by them (unless such period is extended pursuant to Section 3(j)
below) and (ii) the Company and the Guarantors, if any, shall


 


2

















 


make such prospectus and any amendment or supplement thereto available
to any broker-dealer for use in connection with any resale of any Exchange
Securities for a period of not less than 180 days after the consummation
of the Registered Exchange Offer.


 


In connection with the Registered Exchange Offer, the
Company and the Guarantors, if any, shall:


 


(a) mail to each Holder a
copy of the prospectus forming part of the Exchange Offer Registration
Statement, together with an appropriate letter of transmittal and related
documents;


 


(b) use their respective
reasonable best efforts to keep the Registered Exchange Offer open for not less
than 30 days (or longer, if required by applicable law) after the date
notice thereof is mailed to the Holders;


 


(c) utilize the services
of a depositary for the Registered 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;


 


(d) permit Holders to
withdraw tendered Securities at any time prior to the close of business, New
York time, on the last business day on which the Registered Exchange Offer
shall remain open by sending to the institution specified in the notice a
telegram, telex, facsimile transmission or letter setting forth the name of
such Holder, the principal amount of Transfer Restricted Securities delivered
for exchange and a statement that such Holder is withdrawing such Holder’s
election to have such Transfer Restricted Securities exchanged; and


 


(e) otherwise comply with
all applicable laws.


 


As soon as practicable after the close of the
Registered Exchange Offer, the Company and the Guarantors, if any, shall:


 


(x) accept for exchange
all the Initial Securities validly tendered and not withdrawn pursuant to the
terms of the Registered Exchange Offer, including the letter of transmittal
which shall be an exhibit thereto;


 


(y) deliver to the
Trustee for cancellation all the Initial Securities so accepted for exchange;
and


 


(z) cause the Trustee to
authenticate and deliver promptly to each Holder of the Initial Securities,
Exchange Securities, equal in principal amount to the Initial Securities of
such Holder so accepted for exchange.


 


The Indentures will provide that the Exchange
Securities will not be subject to the transfer restrictions set forth in the
Indentures.  The 2008 Indenture will
provide that all of the 2008 Securities, the 2008 Exchange Securities and the
Private 2008 Securities will, collectively, vote and consent together on all
matters as one class and that none of the 2008 Securities, the 2008 Exchange
Securities and the Private 2008 Securities, will have the right to vote or
consent as a class separate from one another on any matter.  The 2013 Indenture will provide that all of
the 2013 Securities, the 2013 Exchange Securities and the Private 2013
Securities will, collectively, vote and consent together on all matters as one
class and that none of the 2013 Securities, the 2013 Exchange Securities and
the Private 2013 Securities, will have the right to vote or consent as a class
separate from one another on any matter.


 


Interest on each Exchange Security issued pursuant to
the Registered Exchange Offer will accrue from the last interest payment date
on which interest was paid on the Initial Securities surrendered in exchange
therefor or, if no interest has been paid on the Initial Securities, from the
date of original issue of the Initial Securities.


 


3

















 


Each Holder participating in the Registered Exchange
Offer shall be required to represent to the Company that at the time of the
consummation of the Registered Exchange Offer (i) any Exchange Securities
received by such Holder will be acquired in the ordinary course of business,
(ii) such Holder will have no arrangements or understanding with any
person to participate in the distribution of the Securities or the Exchange
Securities within the meaning of the Securities Act, (iii) such Holder is
not an “affiliate,” as defined in Rule 405 of the Securities Act, of the
Company or if it is an affiliate, such Holder will comply with the registration
and prospectus delivery requirements of the Securities Act to the extent
applicable, (iv) if such Holder is not a broker-dealer, that it is not
engaged in, and does not intend to engage in, the distribution of the Exchange
Securities and (v) if such Holder is a broker-dealer, that it will receive
Exchange Securities for its own account in exchange for Initial Securities that
were acquired as a result of market-making activities or other trading
activities and that it will be required to acknowledge that it will deliver a
prospectus in connection with any resale of such Exchange Securities.


 


Notwithstanding any other provisions hereof, the
Company and the Guarantors, if any, will ensure that (i) any Exchange
Offer Registration Statement and any amendment thereto and any prospectus
forming part thereof and any supplement thereto complies in all material
respects with the Securities Act and the rules and regulations thereunder,
(ii) any Exchange Offer Registration Statement and any amendment thereto
does not, when it becomes effective, contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading and (iii) any
prospectus forming part of any Exchange Offer Registration Statement, and any
supplement to such prospectus, does not include an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.


 


If following the date hereof there has been announced
a change in Commission policy with respect to exchange offers that in the
reasonable opinion of counsel to the Company raises a substantial question as
to whether the Registered Exchange Offer is permitted by applicable federal
law, the Company and the Guarantors, if any, will seek a no-action letter or
other favorable decision from the Commission allowing the Company and the
Guarantors, if any, to consummate the Registered Exchange Offer, unless the Company
makes a good faith determination based on the advice of counsel that such a
request would be denied in light of publicly available no-action letters, in
which case the Company shall proceed to file a Shelf Registration Statement
pursuant to the provisions of Section 2 hereof.  In the event the Company seeks a no-action letter or other
favorable decision from the Commission pursuant to the preceding sentence, the
Company and the Guarantors, if any, will pursue the issuance of such a decision
to the Commission staff level.  In
connection with the foregoing, the Company and the Guarantors, if any, will
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
(i) participating in telephonic conferences with the Commission,
(ii) 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 the Registered Exchange Offer should be permitted and
(iii) diligently pursuing a resolution (which need not be favorable) by
the Commission staff.


 


2.  Shelf Registration.  If, (i) the Company and the Guarantors, if
any, are not required to file the Exchange Offer Registration Statement; (ii)
the Company and the Guarantors, if any, are not permitted to consummate the
Registered Exchange Offer because the Registered Exchange Offer is not
permitted by applicable law or Commission policy; or (iii) any Holder of Transfer
Restricted Securities notifies the Company prior to the 20th day
following consummation of the Registered Exchange Offer that (a) it is
prohibited by applicable law or Commission policy from participating in the
Registered Exchange Offer; or (b) it may not resell the Exchange Securities
acquired by it in the Registered 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 it;
or (c) it is a broker-dealer and owns Initial Securities acquired directly from
the Company or an affiliate of the Company (including any Initial Purchaser
that holds Initial Securities acquired by it as part of its initial
distribution), the Company and the Guarantors, if any, shall take the following
actions (the date on which any of the conditions described in the foregoing


 


4

















 


clauses (i) through (iii) occur, including in the case of
clause (iii) the receipt of the required notice, being a “Trigger Date”):


 


(a)  The Company and the Guarantors, if any,
shall use their respective reasonable best efforts to promptly (but in no event
more than 45 days after the Trigger Date (such 45th day being a “Filing Deadline”)) file with the Commission
and thereafter use their respective reasonable best efforts to cause to be
declared effective no later than 105 days after the Trigger Date (such 105th
day being an “Effectiveness Deadline”)
a registration statement (the “Shelf
Registration Statement” and, together with the Exchange Offer
Registration Statement, a “Registration
Statement”) on an appropriate form under the Securities Act relating
to the offer and sale of the Transfer Restricted Securities by the Holders
thereof from time to time in accordance with the methods of distribution set
forth in the Shelf Registration Statement and Rule 415 under the
Securities Act (hereinafter, the “Shelf
Registration”); provided, however, that no Holder
(other than an Initial Purchaser) shall be entitled to have the Securities held
by it covered by such Shelf Registration Statement unless such Holder agrees in
writing to be bound by all the provisions of this Agreement applicable to such
Holder.


 


(b)  The Company and the Guarantors, if any,
shall use their respective reasonable best efforts to keep the Shelf
Registration Statement continuously effective in order to permit the prospectus
included therein to be lawfully delivered by the Holders of the Transfer
Restricted Securities, for a period of two years (or for such longer period if
extended pursuant to Section 3(j) below) from the date of its
effectiveness or such shorter period that will terminate when all the
Securities covered by the Shelf Registration Statement (i) have been sold
pursuant thereto or (ii) are no longer restricted securities (as defined
in Rule 144 under the Securities Act, or any successor rule thereof)
(such period, the “Continuously Effective Period”).  The Company and the Guarantors, if any,
shall be deemed not to have used their respective reasonable best efforts to
keep the Shelf Registration Statement effective during the requisite period if
they voluntarily take any action that would result in Holders of Securities
covered thereby not being able to offer and sell such Securities during that
period, unless such action is required by applicable law; provided, however,
upon advising the Holders of the Transfer Restricted Securities and the Initial
Purchasers, the Company may suspend the use of the prospectus included in the
Shelf Registration Statement in the event that and for a period of time not to
exceed 45 consecutive days and no more than 90 days during any 365 day period
in which such suspensions are in effect (each such period, a “Suspension
Period”) if (i) an event or circumstance occurs and is
continuing as a result of which the Shelf Registration Statement, the related
prospectus or any document incorporated therein by reference as then amended or
supplemented or proposed to be filed would, in the good faith judgment of the
Company, contain an untrue statement of material fact or omit to state a
material fact necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading and (ii) (A) the
Company determines in its good faith judgment that the disclosure of such event
at such time would have a material adverse effect on the business, operations
or prospects of the Company and its subsidiaries, taken as a whole or
(B) the disclosure otherwise relates to a material business transaction or
development which has not been publicly disclosed; provided, further,
that upon the termination of such Suspension Period, the Company shall promptly
advise the Initial Purchasers and each Holder of Transfer Restricted Securities
that such Suspension Period has been terminated; provided, further,
that if the Shelf  Registration
Statement ceases to be effective and/or the use of the related prospectus is
suspended pursuant to this Section 2(b), the Continuously Effective Period
shall be extended by the numbers of days such Suspension Period continued.


 


(c)  Notwithstanding any other provisions of this
Agreement to the contrary, the Company and the Guarantors, if any, shall cause
the Shelf Registration Statement and the related prospectus and any amendment
or supplement thereto, as of the effective date of the Shelf Registration
Statement, amendment or supplement, (i) to comply in all material respects with
the applicable requirements of the Securities Act and the rules and regulations
of the Commission and (ii) not to contain any untrue statement of a
material fact or omit to state a material fact required to


 


5

















 


be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading; provided, however, that clause (ii) shall
not apply to any information relating to any Initial Purchaser or any Holder
furnished to the Company in writing by such Initial Purchaser or Holder
expressly for use in the Shelf Registration Statement.


 


3.  Registration Procedures.  In connection with any Shelf Registration
contemplated by Section 2 hereof and, to the extent applicable, any
Registered Exchange Offer contemplated by Section 1 hereof, the following
provisions shall apply:


 


(a)  The Company shall (i) furnish to each
Initial Purchaser, prior to the filing thereof with the Commission, a copy of
the Registration Statement and each amendment thereof and each supplement, if
any, to the prospectus included therein and, in the event that an Initial
Purchaser (with respect to any portion of an unsold allotment from the original
offering) is participating in the Registered Exchange Offer or the Shelf
Registration Statement, the Company and the Guarantors, if any, shall use their
reasonable best efforts to reflect in each such document, when so filed with
the Commission, such comments as such Initial Purchaser reasonably may propose;
(ii) include the information set forth in Annex A hereto on the cover, in
Annex B hereto in the “Exchange Offer Procedures” section and the “Purpose of
the Exchange Offer” section and in Annex C hereto in the “Plan of Distribution”
section of the prospectus forming a part of the Exchange Offer Registration
Statement and include the information set forth in Annex D hereto in the Letter
of Transmittal delivered pursuant to the Registered Exchange Offer;
(iii) if requested by an Initial Purchaser, include the information
required by Items 507 or 508 of Regulation S-K under the Securities Act, as
applicable, in the prospectus forming a part of the Exchange Offer Registration
Statement; (iv) include within the prospectus contained in the Exchange
Offer Registration Statement a section entitled “Plan of Distribution,”
reasonably acceptable to the Initial Purchasers, that shall contain a summary
statement of the positions taken or policies made by the staff of the
Commission with respect to the potential “underwriter” status of any
broker-dealer that is the beneficial owner (as defined in Rule 13d-3 under
the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) of Exchange
Securities received by such broker-dealer in the Registered Exchange Offer (a “Participating Broker-Dealer”), whether such
positions or policies have been publicly disseminated by the staff of the
Commission or such positions or policies, in the reasonable judgment of the
Initial Purchasers based upon advice of counsel (which may be in-house
counsel), represent the prevailing views of the staff of the Commission; and
(v) in the case of a Shelf Registration Statement, include the names of
the Holders who propose to sell Securities pursuant to the Shelf Registration
Statement as selling securityholders.


 


(b)  The Company shall give written notice to the
Initial Purchasers, the Holders of the Transfer Restricted Securities and any
Participating Broker-Dealer from whom the Company has received prior written
notice that it will be a Participating Broker-Dealer in the Registered Exchange
Offer (which notice pursuant to clauses (ii)-(v) hereof shall be accompanied by
an instruction to suspend the use of the prospectus until the requisite changes
have been made):


 


(i) when the Registration
Statement or any amendment thereto has been filed with the Commission and when
the Registration Statement or any post-effective amendment thereto has become
effective;


 


(ii) of any request by
the Commission for amendments or supplements to the Registration Statement or
the prospectus included therein or for additional information;


 


(iii) of the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or the initiation of any proceedings for that purpose;


 


6

















 


(iv) of the receipt by
the Company or its legal counsel of any notification with respect to the
suspension of the qualification of the Securities for sale in any jurisdiction
or the initiation or threatening of any proceeding for such purpose; and


 


(v) of the happening of
any event that requires the Company to make changes in the Registration
Statement or the prospectus in order that the Registration Statement or the
prospectus do not contain an untrue statement of a material fact nor omit to
state a material fact required to be stated therein or necessary to make the
statements therein (in the case of the prospectus, in light of the
circumstances under which they were made) not misleading.


 


(c)  The Company and the Guarantors, if any,
shall make every reasonable effort to obtain the withdrawal at the earliest
possible time, of any order suspending the effectiveness of the Registration
Statement.


 


(d)  The Company shall furnish to each Holder of
Securities included within the coverage of the Shelf Registration, without
charge, at least one copy of the Shelf Registration Statement and any
post-effective amendment thereto, including financial statements and schedules,
and, if the Holder so requests in writing, all exhibits thereto (including
those, if any, incorporated by reference).


 


(e) 
The Company shall deliver to each Exchanging Dealer and each Initial
Purchaser, and to any other Holder who so requests, without charge, at least
one copy of the Exchange Offer Registration Statement and any post-effective
amendment thereto, including financial statements and schedules, and, if any
Initial Purchaser or any such Holder requests, all exhibits thereto (including
those, if any, incorporated by reference).


 


(f)  The Company shall, during the Shelf
Registration Period, deliver to each Holder of Securities included within the
coverage of the Shelf Registration, without charge, as many copies of the
prospectus (including each preliminary prospectus) included in the Shelf
Registration Statement and any amendment or supplement thereto as such person
may reasonably request.  The Company
consents, subject to the provisions of this Agreement, to the use of the
prospectus or any amendment or supplement thereto by each of the selling
Holders of the Transfer Restricted Securities in connection with the offering
and sale of the Securities covered by the prospectus, or any amendment or
supplement thereto, included in the Shelf Registration Statement.


 


(g)  The Company shall deliver to each Initial
Purchaser, any Exchanging Dealer, any Participating Broker-Dealer and such
other persons required to deliver a prospectus following the Registered
Exchange Offer, without charge, as many copies of the final prospectus included
in the Exchange Offer Registration Statement and any amendment or supplement
thereto as such persons may reasonably request.  The Company and the Guarantors, if any, consent, subject to the
provisions of this Agreement, to the use of the prospectus or any amendment or
supplement thereto by any Initial Purchaser, if necessary, any Participating
Broker-Dealer and such other persons required to deliver a prospectus following
the Registered Exchange Offer in connection with the offering and sale of the
Exchange Securities covered by the prospectus, or any amendment or supplement
thereto, included in such Exchange Offer Registration Statement.


 


(h)  Prior to any public offering of the
Securities pursuant to any Registration Statement the Company and the
Guarantors, if any, shall use their reasonable best efforts to register or qualify
or cooperate with the Holders of the Securities included therein and their
respective counsel in connection with the registration or qualification of the
Securities for offer and sale under the securities or “blue sky” laws of such
states of the United States as any Holder of the Securities reasonably requests
in writing and do any and all other acts or things that may be reasonably
necessary or advisable to enable the offer and sale in such jurisdictions of
the Securities covered by such Registration Statement; provided, however,
that the Company and each


 


7

















 


of the Guarantors, if any, shall not be required to
(i) qualify generally to do business in any jurisdiction where it is not
then so qualified or (ii) take any action that would subject it to general
service of process or to taxation in any jurisdiction where it is not then so
subject.


 


(i)  The Company shall reasonably cooperate with
the Holders of the Securities to facilitate the timely preparation and delivery
of certificates representing the Securities to be sold pursuant to any
Registration Statement free of any restrictive legends and in such
denominations and registered in such names as the Holders may reasonably
request a reasonable period of time prior to sales of the Securities pursuant
to such Registration Statement.


 


(j)  Upon the occurrence of any event
contemplated by paragraphs (ii) through (v) of Section 3(b) above
during the period for which the Company and the Guarantors, if any, are
required to maintain an effective Registration Statement, other than during a
Suspension Period, the Company and the Guarantors, if any, shall use their
reasonable best efforts to promptly prepare and file a post-effective amendment
to the Registration Statement or a supplement to the related prospectus and any
other required document so that, as thereafter delivered to Holders of the
Securities or purchasers of Securities, the prospectus will not contain an
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading.  If the Company notifies the Initial Purchasers,
the Holders of the Transfer Restricted Securities and any known Participating
Broker-Dealer in accordance with paragraphs (ii) through (v) of
Section 3(b) above to suspend the use of the prospectus until the
requisite changes to the prospectus have been made, then the Initial Purchasers,
the Holders of the Transfer Restricted Securities and any such Participating
Broker-Dealers shall suspend use of such prospectus, and the period of
effectiveness of the Shelf Registration Statement provided for in
Section 2(b) above and the Exchange Offer Registration Statement provided
for in Section 1 above, if applicable, shall each be extended by the
number of days from and including the date of the giving of such notice to
and including the date when the Initial Purchasers, the Holders of the Transfer
Restricted Securities and any known Participating Broker-Dealer shall have
received such amended or supplemented prospectus pursuant to this
Section 3(j).


 


(k)  Not later than the effective date of the
applicable Registration Statement, the Company will provide a CUSIP number for
the Initial Securities or the Exchange Securities, as the case may be, and
provide the applicable trustee with printed certificates for the Initial
Securities or the Exchange Securities, as the case may be, in a form eligible
for deposit with The Depository Trust Company.


 


(l)  The Company and the Guarantors, if any, will
comply with all rules and regulations of the Commission to the extent and so
long as they are applicable to the Registered Exchange Offer or the Shelf
Registration and will make generally available to its security holders (or
otherwise provide in accordance with Section 11(a) of the Securities Act)
an earnings statement satisfying the provisions of Section 11(a) of the
Securities Act, no later than 45 days after the end of a 12-month period
(or 90 days, if such period is a fiscal year) beginning with the first
month of the Company’s first fiscal quarter commencing after the effective date
of the Registration Statement, which statement shall cover such 12-month period.


 


(m)  The Company shall cause the Indentures to be
qualified under the Trust Indenture Act of 1939, as amended, in a timely manner
and containing such changes, if any, as shall be necessary for such
qualification.  In the event that such
qualification would require the appointment of new trustees under the
Indentures, the Company shall appoint new trustees thereunder pursuant to the
applicable provisions of the Indentures.


 


(n)  The Company may require each Holder of
Securities to be sold pursuant to the Shelf Registration Statement to furnish
to the Company such information regarding the Holder and the distribution of
the Securities as the Company may from time to time reasonably require for


 


8

















 


inclusion in the Shelf Registration Statement, and the
Company may exclude from such registration the Securities of any Holder that
unreasonably fails to furnish such information within a reasonable time after
receiving such request.


 


(o)  The Company and the Guarantors, if any,
shall enter into such customary agreements (including, if requested, an
underwriting agreement in customary form) and take all such other action, if
any, as any Holder of the Securities shall reasonably request in order to
facilitate the disposition of the Securities pursuant to any Shelf
Registration.


 


(p)  In the case of any Shelf Registration, the
Company shall (i) make reasonably available for inspection by the Holders
of the Transfer Restricted Securities, any underwriter participating in any
disposition pursuant to the Shelf Registration Statement and any attorney,
accountant or other agent retained by the Holders of the Transfer Restricted
Securities or any such underwriter all relevant financial and other records,
pertinent corporate documents and properties of the Company reasonably
requested by such persons and (ii) cause the Company’s officers,
directors, employees, accountants and auditors to supply all relevant
information reasonably requested by the Holders of the Transfer Restricted Securities
or any such underwriter, attorney, accountant or agent in connection with the
Shelf Registration Statement, in each case of (i) and (ii), as shall be
reasonably necessary to enable such persons, to conduct a reasonable
investigation within the meaning of Section 11 of the Securities Act; provided,
however, that the foregoing inspection and information gathering shall
be coordinated on behalf of the Initial Purchasers by Credit Suisse First
Boston LLC and on behalf of the other parties, by one counsel designated by and
on behalf of such other parties as described in Section 4 hereof; and provided,
further, that as to any information that is designated in writing by the
Company, in good faith, as confidential at the time of delivery, such
information shall be kept confidential by the Holder or by any such
underwriter, attorney, accountant or other agent.


 


(q)  In the case of any Shelf Registration, the
Company, if requested by any Holder of Transfer Restricted Securities covered
thereby, shall cause (i) its counsel to deliver an opinion and updates
thereof relating to the Securities in customary form addressed to such Holders
and the managing underwriters, if any, thereof and dated, in the case of the
initial opinion, the effective date of such Shelf Registration Statement (it
being agreed that the matters to be covered by such opinion shall include,
without limitation, the due incorporation and good standing of the Company and
its subsidiaries; the qualification of the Company and its subsidiaries to transact
business as foreign corporations; the due authorization, execution and delivery
of the relevant agreement of the type referred to in Section 3(o) hereof;
the due authorization, execution, authentication and issuance, and the validity
and enforceability, of the applicable Securities; the absence of material legal
or governmental proceedings involving the Company and its subsidiaries; the
absence of governmental approvals required to be obtained in connection with
the Shelf Registration Statement, the offering and sale of the applicable
Securities, or any agreement of the type referred to in Section 3(o)
hereof; the compliance as to form of such Shelf Registration Statement and any
documents incorporated by reference therein, if any, and of the Indenture with
the requirements of the Securities Act and the Trust Indenture Act,
respectively; and, as of the date of the opinion and as of the effective date
of the Shelf Registration Statement or most recent post-effective amendment
thereto, as the case may be, the absence from such Shelf Registration Statement
and the prospectus included therein, as then amended or supplemented, and from
any documents incorporated by reference therein, if any, of an untrue statement
of a material fact or the omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading
(in the case of any such documents, in the light of the circumstances existing
at the time that such documents were filed with the Commission under the
Securities Act or the Exchange Act); (ii) its officers to execute and
deliver all customary documents and certificates and updates thereof reasonably
requested by any underwriters of the applicable Securities; and (iii) its
independent public accountants and the independent public accountants with
respect to any other entity for which financial information is provided in the
Shelf Registration Statement to provide to the selling Holders of the
applicable Transfer Restricted


 


9

















 


Securities and any underwriter therefor a comfort
letter in customary form and covering matters of the type customarily covered
in comfort letters in connection with primary underwritten offerings, subject
to receipt of appropriate documentation as contemplated, and only if permitted,
by Statement of Auditing Standards No. 72.


 


(r)  In the case of the Registered Exchange
Offer, if requested by any Initial Purchaser or any known Participating
Broker-Dealer, the Company shall cause (i) its counsels to deliver to such
Initial Purchaser or such Participating Broker-Dealer signed opinions in
the forms set forth in Section 6(c),(d),(f),(g) and (h) of the Purchase
Agreement with such changes as are customary in connection with the preparation
of a Registration Statement and (ii) its independent public accountants
and the independent public accountants with respect to any other entity for
which financial information is provided in the Registration Statement to
deliver to such Initial Purchaser or such Participating Broker-Dealer a comfort
letter, in form and substance satisfactory to the Initial Purchasers, with
appropriate date changes.


 


(s)  If a Registered Exchange Offer is to be
consummated, upon delivery of the Initial Securities by Holders to the Company
(or to such other Person as directed by the Company) in exchange for the
Exchange Securities, the Company shall mark, or caused to be marked, on the
Initial Securities so exchanged that such Initial Securities are being canceled
in exchange for the Exchange Securities; in no event shall the Initial
Securities be marked as paid or otherwise satisfied.


 


(t)  The Company will use its reasonable best
efforts to (a) if the Initial Securities have been rated prior to the
initial sale of such Initial Securities, confirm such ratings will apply to the
Securities covered by a Registration Statement; or (b) if the Initial
Securities were not previously rated, cause the Securities covered by a
Registration Statement to be rated with the appropriate rating agencies, if so
requested by Holders of a majority in aggregate principal amount of Transfer
Restricted Securities covered by such Registration Statement, or by the
managing underwriters, if any.


 


(u)  In the event that any broker-dealer registered
under the Exchange Act shall underwrite any Securities or participate as a
member of an underwriting syndicate or selling group or “assist in the
distribution” (within the meaning of the Conduct Rules (the “Rules”) of the National Association of
Securities Dealers, Inc. (“NASD”))
thereof, whether as a Holder of such Securities or as an underwriter, a
placement or sales agent or a broker or dealer in respect thereof, or
otherwise, the Company will assist such broker-dealer in complying with the
requirements of such Rules, including, without limitation, by (i) if such
Rules, including Rule 2720, shall so require, engaging a “qualified
independent underwriter” (as defined in Rule 2720) to participate in the
preparation of the Registration Statement relating to such Securities, to
exercise usual standards of due diligence in respect thereto and, if any
portion of the offering contemplated by such Registration Statement is an
underwritten offering or is made through a placement or sales agent, to
recommend the yield of such Securities; (ii) indemnifying any such
qualified independent underwriter to the extent of the indemnification of
underwriters provided in Section 5 hereof; and (iii) providing such
information to such broker-dealer as may be required in order for such
broker-dealer to comply with the requirements of the Rules.


 


(v)  The Company and the Guarantors, if any,
shall use their respective reasonable best efforts to take all other steps
necessary to effect the registration of the Securities covered by a
Registration Statement contemplated hereby.


 


4.  Registration Expenses.  (a) All expenses incident to the Company’s
and the Guarantors, if any, performance of and compliance with this Agreement
will be borne by the Company, regardless of whether a Registration Statement is
ever filed or becomes effective, including without limitation;


 


(i) all registration and
filing fees and expenses;


 


10

















 


(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 Securities to be issued in
the Registered Exchange Offer and printing of Prospectuses), messenger and
delivery services and telephone;


 


(iv) all fees and
disbursements of counsel for the Company and the Guarantors, if any;


 


 (v) all application and filing fees in
connection with listing the Exchange Securities on a national securities
exchange or automated quotation system pursuant to the requirements hereof; and


 


(vi) all fees and
disbursements of independent certified public accountants of the Company
(including the expenses of any special audit and comfort letters required by or
incident to such performance);


 


provided, however, each
Holder shall pay all underwriting discounts and commissions and transfer taxes,
if any, relating to the sale or disposition of such Holder’s Transfer
Restricted Securities pursuant to the Shelf Registration Statement.


 


The Company and the Guarantors, if any, will bear their internal
expenses (including, without limitation, all salaries and expenses of its
officers and employees performing legal or accounting duties), the expenses of
any annual audit and the fees and expenses of any person, including special
experts, retained by the Company and the Guarantors, if any.


 


(b)  In
connection with any Registration Statement required by this Agreement, the
Company will reimburse the Initial Purchasers and the Holders of Transfer
Restricted Securities who are tendering Initial Securities in the Registered
Exchange Offer and/or selling or reselling Securities 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 Latham & Watkins
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.


 


5.  Indemnification.  (a)  The Company and the
Guarantors, if any, agree to indemnify and hold harmless each Holder of the
Securities, any Participating Broker-Dealer and each person, if any, who
controls such Holder or such Participating Broker-Dealer within the meaning of
the Securities Act or the Exchange Act (each Holder, any Participating
Broker-Dealer and such controlling persons are referred to collectively as the
“Indemnified Parties”) from and
against any losses, claims, damages or liabilities, joint or several, or any
actions in respect thereof (including, but not limited to, any losses, claims,
damages, liabilities or actions relating to purchases and sales of the
Securities) to which each Indemnified Party may become subject under the
Securities Act, the Exchange Act or otherwise, insofar as such losses, claims,
damages, liabilities or actions arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in a
Registration Statement or prospectus or in any amendment or supplement thereto
or in any preliminary prospectus relating to a Shelf Registration, 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 shall reimburse, as incurred, the Indemnified
Parties for any legal or other expenses reasonably incurred by them in
connection with investigating or defending any such loss, claim, damage, liability
or action in respect thereof; provided, however, that
(i) the Company and the Guarantors, if any, shall not be liable in any
such case to the extent that such loss, claim, damage, liability or action
arises out of or is based upon any untrue statement or alleged untrue statement
or omission or alleged omission made in a Registration Statement or prospectus
or in any amendment or supplement thereto or in any preliminary prospectus
relating to a Shelf Registration in reliance upon and in conformity with written
information pertaining to such Holder and furnished to the Company and the


 


11

















 


Guarantors, if any, by or on behalf of such Holder specifically for
inclusion therein; and (ii) with respect to any untrue statement or
omission or alleged untrue statement or omission made in any preliminary
prospectus relating to a Shelf Registration Statement, the indemnity agreement
contained in this subsection (a) shall not inure to the benefit of any
Holder or Participating Broker-Dealer from whom the person asserting any such
losses, claims, damages, liabilities or actions purchased the Securities
concerned, to the extent that a prospectus relating to such Securities was
required to be delivered by such Holder or Participating Broker-Dealer under
the Securities Act in connection with such purchase and any such loss, claim,
damage, liability or action of such Holder or Participating Broker-Dealer
results from the fact that there was not sent or given to such person, at or
prior to the written confirmation of the sale of such Securities to such
person, a copy of the final prospectus, as it may be amended or supplemented,
if the Company had previously furnished copies thereof to such Holder or
Participating Broker-Dealer; provided  further, however,
that this indemnity agreement will be in addition to any liability that the
Company and the Guarantors, if any, may otherwise have to such Indemnified
Party.  The Company and the Guarantors,
if any, shall also indemnify underwriters, their officers and directors and
each person who controls such underwriters within the meaning of the Securities
Act or the Exchange Act to the same extent as provided above with respect to
the indemnification of the Holders of the Securities if requested by such
Holders.


 


(b)  Each
Holder of the Securities, severally and not jointly, will indemnify and hold
harmless (i) the Company and the Guarantors, if any, and each person, if
any, who controls the Company or the Guarantors, if any, within the meaning of
the Securities Act or the Exchange Act, (ii) each of their respective
directors and (iii) each of their respective officers who signs a
Registration Statement from and against any losses, claims, damages or
liabilities or any actions in respect thereof, to which the Company or the
Guarantors, if any, or any such controlling person may become subject under the
Securities Act, the Exchange Act or otherwise, insofar as such losses, claims,
damages, liabilities or actions arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in a
Registration Statement or prospectus or in any amendment or supplement thereto
or in any preliminary prospectus relating to a Shelf Registration, or arise out
of or are based upon the omission or alleged omission to state therein a
material fact necessary to make the statements therein not misleading, but in
each case only to the extent that the untrue statement or omission or alleged
untrue statement or omission was made in reliance upon and in conformity with
written information pertaining to such Holder and furnished to the Company or
the Guarantors, if any, by or on behalf of such Holder specifically for
inclusion therein; and, subject to the limitation set forth immediately preceding
this clause, shall reimburse, as incurred, the Company and the Guarantors, if
any, for any legal or other expenses reasonably incurred by the Company and the
Guarantors, if any, or any such controlling person, director or officer in
connection with investigating or defending any loss, claim, damage, liability
or action in respect thereof.  This
indemnity agreement will be in addition to any liability that such Holder may
otherwise have to the Company or the Guarantors, if any, or any of their respective
controlling persons, directors or officers.


 


(c)  Promptly
after receipt by an indemnified party under this Section 5 of notice of
the commencement of any action or proceeding (including a governmental
investigation), such indemnified party will, if a claim in respect thereof is
to be made against the indemnifying party under this Section 5, notify the
indemnifying party of the commencement thereof; but the omission so to notify
the indemnifying party 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.  In case any such action is brought against
any indemnified party, and it notifies the indemnifying party of the commencement
thereof, the indemnifying party will be entitled to participate therein and, to
the extent that it may wish, jointly with any other indemnifying party
similarly notified, to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party (who shall not, except with the consent
of the indemnified party, be counsel to the indemnifying party), and after
notice from the indemnifying party to such indemnified party of its election so
to assume the defense thereof the indemnifying party will not be liable to such
indemnified party under this Section 5 for any legal or other expenses,
other than reasonable costs of investigation prior to assumption of defenses,
subsequently incurred by such indemnified party in connection with the defense
thereof.  No indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened action in respect of which any
indemnified party is or could have been a party and indemnity could have been
sought hereunder by such


 


12

















 


indemnified party unless such settlement includes an unconditional
release of such indemnified party from all liability on any claims that are the
subject matter of such action, and does not include a statement as to or an
admission of fault, culpability or a failure to act by or on behalf of any
indemnified party.


 


(d)  If the
indemnification provided for in this Section 5 is unavailable or
insufficient to hold harmless an indemnified party under subsections (a) or (b)
above, then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses, claims, damages or
liabilities (or actions in respect thereof) referred to in subsection (a)
or (b) above (i) in such proportion as is appropriate to reflect the
relative benefits received by the indemnifying party or parties on the one hand
and the indemnified party on the other from the exchange of the Securities,
pursuant to the Registered Exchange Offer; or (ii) if the allocation
provided by the foregoing clause (i) is not permitted by applicable law,
in such proportion as is appropriate to reflect not only the relative benefits
referred to in clause (i) above but also the relative fault of the
indemnifying party or parties on the one hand and the indemnified party on the
other in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities (or actions in respect thereof) as well
as any other relevant equitable considerations.  The relative fault of the parties 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 and the Guarantors, if any,
on the one hand or such Holder or such other indemnified party, as the case may
be, on the other, and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or
omission.  The amount paid by an
indemnified party as a result of the losses, claims, damages, liabilities or
actions referred to in the first sentence of this subsection (d) shall be
deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any action or
claim that is the subject of this subsection (d).  Notwithstanding any other provision of this
Section 5(d), the Holders of the Securities shall not be required to
contribute any amount in excess of the amount by which the net proceeds
received by such Holders from the sale of the Securities pursuant to a
Registration Statement exceeds the amount of damages that such Holders have
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. 
No person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution
from any person who was not guilty of such fraudulent misrepresentation.  For purposes of this paragraph (d), each
person, if any, who controls such indemnified party within the meaning of the
Securities Act or the Exchange Act shall have the same rights to contribution
as such indemnified party and each person, if any, who controls the Company or
the Guarantors, if any, within the meaning of the Securities Act or the
Exchange Act shall have the same rights to contribution as the Company and the
Guarantors, if any.


 


(e)  The
agreements contained in this Section 5 shall survive the sale of the
Securities pursuant to a Registration Statement and shall remain in full force
and effect, regardless of any termination or cancellation of this Agreement or
any investigation made by or on behalf of any indemnified party.


 


6.  Additional Interest Under Certain
Circumstances. 
(a)  Additional interest (the “Additional Interest”) with respect to the Securities shall be
assessed as follows if any of the following events occur (each such event in
clauses (i) through (iv) below being herein called a “Registration Default”):


 


(i)                                     any
Registration Statement required by this Agreement is not filed with the
Commission on or prior to the applicable Filing Deadline;


 


(ii)                                  any
Registration Statement required by this Agreement is not declared effective by
the Commission on or prior to the applicable Effectiveness Deadline;


 


(iii)                               the
Registered Exchange Offer has not been consummated on or prior to the
Consummation Deadline; or


 


(iv)                              any
Registration Statement required by this Agreement has been declared effective
by the Commission but (A) such Registration Statement thereafter ceases to
be effective or


 


13

















 


(B) such Registration Statement or the related
prospectus ceases to be usable in connection with resales of Transfer
Restricted Securities during the periods specified herein because either
(1) any event occurs as a result of which the related prospectus forming
part of such Registration Statement would include any 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, other than during any Suspension Period, or (2) it shall
be necessary to amend such Registration Statement or supplement the related
prospectus, to comply with the Securities Act or the Exchange Act or the
respective rules thereunder.


 


Each of the foregoing will constitute a Registration Default whatever
the reason for any such event and whether it is voluntary or involuntary or is
beyond the control of the Company or the Guarantors, if any, or pursuant to
operation of law or as a result of any action or inaction by the Commission .


 


Additional Interest shall accrue on the Transfer
Restricted Securities over and above the interest set forth in the title of the
Securities from and including the date on which any such Registration Default
shall occur to but excluding the date on which all such Registration Defaults
have been cured, in an amount equal to $.05 per week per $1,000 principal
amount of Transfer Restricted Securities for the first 90-day period
immediately following the occurrence of such Registration Default.  The amount of Additional Interest shall
increase by an additional $.05 per week per $1,000 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 Additional
Interest for all Registration Defaults of $.50 per week per $1,000 principal
amount of Transfer Restricted Securities.


 


(b)  A
Registration Default referred to in Section 6(a)(iv) hereof shall be
deemed not to have occurred and be continuing in relation to a Shelf
Registration Statement or the related prospectus if (i) such Registration
Default has occurred solely as a result of (x) the filing of a post-effective
amendment to such Shelf Registration Statement to incorporate annual audited
financial information with respect to the Company where such post-effective
amendment is not yet effective and needs to be declared effective to permit
Holders to use the related prospectus or (y) other material events, with
respect to the Company that would need to be described in such Shelf
Registration Statement or the related prospectus or (z) the need to comply
with the Securities Act or the Exchange Act or the respective rules thereunder
that would require an amendment to the Shelf Registration Statement or a supplement
to the related prospectus; and (ii) in the case of clauses (y) or (z), the
Company is proceeding promptly and in good faith to amend or supplement such
Shelf Registration Statement and related prospectus to describe such events or
to comply; provided, however, that in any case if such
Registration Default occurs for a continuous period in excess of 30 days,
other than with respect to a Suspension Period, Additional Interest shall be
payable in accordance with the above paragraph from the day such Registration
Default occurs until such Registration Default is cured.  The Company shall not be required to pay
Additional Interest for more than one Registration Default at any given time.


 


(c)  Any
amounts of Additional Interest due pursuant to Section 6(a) hereof will be
payable in cash on the regular interest payment dates with respect to the
Securities.  Notwithstanding anything to
the contrary set forth herein, (i) upon filing of the Exchange Offer
Registration Statement (and/or, if applicable, the Shelf Registration
Statement), in the case of clause (a)(i) of this Section 6, (ii) upon the
effectiveness of the Exchange Offer Registration Statement (and/or, if
applicable, the Shelf Registration Statement), in the case of clause (a)(ii) of
this Section 6, (iii) upon consummation of the Registered Exchange Offer, in
the case of clause (a)(iii) of this Section 6, or (iv) upon 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 clause (a)(iv) of this Section 6, the
Additional Interest payable with respect to the Transfer Restricted Securities
as a result of such clauses 6(a)(i), 6(a)(ii), 6(a)(iii) or 6(a)(iv), as
applicable, shall cease and such Registration Default shall be deemed to have
been cured.  For the avoidance of doubt,
such cure shall only apply to such existing Registration Default and shall not
be deemed to cure any Registration Defaults arising thereafter.


 


14

















 


(d)  “Transfer
Restricted Securities” means each Security and the related Subsidiary
Guarantees, if any, until (i) the date on which such Security has been
exchanged by a person other than a broker-dealer for a freely transferable
Exchange Security in the Registered Exchange Offer; (ii) following the
exchange by a broker-dealer in the Registered Exchange Offer of an Initial
Security for an Exchange Note, the date on which such Exchange Note and the
related Subsidiary Guarantee, if any, is sold to a purchaser who receives from
such broker-dealer on or prior to the date of such sale a copy of the
prospectus contained in the Exchange Offer Registration Statement;
(iii) the date on which such Security has been effectively registered
under the Securities Act and disposed of in accordance with the Shelf
Registration Statement; or (iv) the date on which such Security is
distributed to the public pursuant to Rule 144 under the Securities Act or
is saleable pursuant to Rule 144(k) under the Securities Act.


 


7.  Rules 144 and 144A.  The Company and the Guarantors, if any,
shall use their respective reasonable best efforts to file the reports required
to be filed by them under the Securities Act and the Exchange Act in a timely
manner and, if at any time the Company or any of the Guarantors, if any, are
not required to file such reports, they will, upon the request of any Holder of
Securities, make publicly available other information so long as necessary to
permit sales of their securities pursuant to Rules 144 and 144A.  The Company and each of the Guarantors, if
any, covenants that they will take such further action as any Holder of
Securities may reasonably request, all to the extent required from time to time
to enable such Holder to sell Securities without registration under the
Securities Act within the limitation of the exemptions provided by
Rules 144 and 144A (including the requirements of
Rule 144A(d)(4)).  The Company and
the Guarantors, if any, will provide a copy of this Agreement to prospective
purchasers of Initial Securities identified to the Company and the Guarantors,
if any, by the Initial Purchasers upon request.  Upon the request of any Holder of Initial Securities, the Company
and the Guarantors, if any, shall deliver to such Holder a written statement as
to whether they have complied with such requirements.  Notwithstanding the foregoing, nothing in this Section 7 shall
be deemed to require the Company or the Guarantors, if any, to register any of
its securities pursuant to the Exchange Act.


 


8.  Underwritten Registrations.  If any of the Transfer Restricted Securities
covered by any Shelf Registration are to be sold in an underwritten offering,
the investment banker or investment bankers and manager or managers that will
administer the offering (“Managing Underwriters”) will be selected by the
Holders of a majority in aggregate principal amount of such Transfer Restricted
Securities to be included in such offering.


 


No person may participate in any underwritten
registration hereunder unless such person (i) agrees to sell such person’s
Transfer Restricted Securities on the basis reasonably provided in any
underwriting arrangements approved by the persons entitled hereunder to approve
such arrangements; and (ii) completes and executes all questionnaires, powers
of attorney, indemnities, underwriting agreements and other documents
reasonably required under the terms of such underwriting arrangements.


 


9.   Future
Subsidiary Guarantees.  If, prior to the Consummation of the
Exchange Offer or prior to the effectiveness of the Shelf Registration
Statement, as the case may be, any subsidiary of the Company executes a
Subsidiary Guarantee in accordance with the terms and provisions of the
Indentures, the Company shall cause such subsidiary to execute and deliver to
the parties hereto a counterpart signature page to this Agreement, and such
subsidiary shall be bound by all of the provisions of this Agreement as a
“Guarantor.”


 


10.  Miscellaneous.


 


(a) 
Remedies.  The Company and the
Guarantors, if any, acknowledge and agree that any failure by the Company or
the Guarantors, if any, to comply with their respective obligations under
Sections 1 and 2 hereof may result in material irreparable injury to the
Initial Purchasers 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 Purchasers or any Holder
may obtain such relief as may be required to specifically enforce the Company’s
and the Guarantors’, if any, obligations under Sections 1


 


15

















 


and 2 hereof.  The Company and
the Guarantors, if any, further agree to waive the defense in any action for
specific performance that a remedy at law would be adequate.


 


(b)  No Inconsistent Agreements.  The Company and the Guarantors, if any, will
not on or after the date of this Agreement enter into any agreement with
respect to their securities that is inconsistent with the rights granted to the
Holders in this Agreement or otherwise conflicts with the provisions
hereof.  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 or the Guarantors’, if any,
securities under any agreement in effect on the date hereof.


 


(c)  Amendments and Waivers.  The provisions of this Agreement may not be
amended, modified or supplemented, and waivers or consents to departures from
the provisions hereof may not be given, except by the Company and the written
consent of the Holders of a majority in principal amount of the Securities affected
by such amendment, modification, supplement, waiver or consents.


 


(d)  Notices. 
All notices and other communications provided for or permitted hereunder
shall be made in writing by hand delivery, first-class mail, facsimile
transmission, or air courier that guarantees overnight delivery:


 


(1)  if to a
Holder of the Securities, at the most current address given by such Holder to
the Company.


 


(2)  if to the
Initial Purchasers;


 


Credit Suisse First Boston LLC


Eleven Madison Avenue


New York, NY 10010-3629


Fax No.: (212) 325-8278


Attention: Transactions Advisory Group


 


with a copy to:


 


Latham & Watkins LLP


885 Third Avenue


New York, NY 10022


Fax No.: (212) 751-4864


Attention: Kirk A. Davenport, Esq.


 


(3)                                  if
to the Company or any of the Guarantors, if any;


 


SEMCO Energy, Inc.


28470 13 Mile Road, Suite 300


Farmington Hills, MI 48334


Fax No.: (248) 702-6306


Attention: Mark Prendeville, Esq.


 


with a copy to:


 


Gibson, Dunn and Crutcher LLC


200 Park Avenue, 47th Floor


New York, NY 10166


Fax No.: (212) 351-5278


Attention: Steven Buffone, Esq.


 


16

















 


All such notices and communications shall be deemed to
have been duly given: at the time delivered by hand, if personally delivered;
three business days after being deposited in the mail, postage prepaid, if
mailed; when receipt is acknowledged by recipient’s facsimile machine operator,
if sent by facsimile transmission; and on the day delivered, if sent by
overnight air courier guaranteeing next day delivery.


 


(e) Third Party
Beneficiaries.  The Holders
shall be third party beneficiaries to the agreements made hereunder between the
Company and the Guarantors, if any, on the one hand, and the Initial
Purchasers, 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 their rights or the rights of Holders hereunder.


 


(f)  Successors and Assigns.  This Agreement shall be binding upon the
Company and the Guarantors, if any, and their respective successors and
assigns.


 


(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 PRINCIPLES OF
CONFLICTS OF LAWS.


 


(j)  Severability.  If 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)  Securities Held by the Company.  Whenever the consent or approval of Holders
of a specified percentage of principal amount of Securities is required
hereunder, Securities held by the Company or its affiliates (other than
subsequent Holders of Securities if such subsequent Holders are deemed to be
affiliates solely by reason of their holdings of such Securities) shall not be
counted in determining whether such consent or approval was given by the
Holders of such required percentage.


 


(l)   Submission to Jurisdiction.  The Company hereby submits to the
non-exclusive jurisdiction of the Federal and state courts 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.


 


17

















 


If the foregoing is in accordance with your
understanding of our agreement, please sign and return to the Company a
counterpart hereof, whereupon this instrument, along with all counterparts,
will become a binding agreement among the several Initial Purchasers and the
Company and the Guarantors, if any, in accordance with its terms.


 


	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  SEMCO Energy, Inc.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  by

  
	
   

  	
   

  	
  /s/  Mark Prendeville

  	
   

  
	
   

  	
  Name:  Mark Prendeville

  
	
   

  	
  Title:    V.P. and General Counsel

  



 


18

















 


 


The foregoing Registration


Rights Agreement is hereby confirmed

and accepted as of the date first

above written.


 


CREDIT SUISSE FIRST BOSTON LLC


MCDONALD INVESTMENTS INC.


ABN AMRO INCORPORATED


US BANCORP PIPER JAFFRAY INC.


NATCITY INVESTMENTS, INC.


 


 


	
  By:  Credit
  Suisse First Boston LLC

  
	
   

  
	
   

  
	
  by

  
	
   

  	
   /s/  
  Joseph E. Reece

  	
   

  
	
  Name:  Joseph E. Reece

  
	
  Title:    Managing Director

  



 


19

















 


ANNEX A


 


Each broker-dealer that receives Exchange Securities
for its own account pursuant to the Exchange Offer must acknowledge that it
will deliver a prospectus in connection with any resale of such Exchange
Securities.  The Letter of Transmittal
states that by so acknowledging and by delivering a prospectus, a broker-dealer
will not be deemed to admit that it is an “underwriter” within the meaning of
the Securities Act.  This Prospectus, as
it may be amended or supplemented from time to time, may be used by
a broker-dealer in connection with resales of Exchange Securities received
in exchange for Initial Securities where such Initial Securities were acquired
by such broker-dealer as a result of market-making activities or other trading
activities.  The Company and the Guarantors,
if any, have agreed that, for a period of 180 days after the Expiration
Date (as defined herein), they will make this Prospectus available to any
broker-dealer for use in connection with any such resale.  See “Plan of Distribution.”


 


20

















 


ANNEX B


 


Each broker-dealer that
receives Exchange Securities for its own account in exchange for Initial
Securities, where such Initial Securities were acquired by such broker-dealer
as a result of market-making activities or other trading activities, must
acknowledge that it will deliver a prospectus in connection with any resale of
such Exchange Securities.  See “Plan of
Distribution.”


 


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ANNEX C


 


PLAN OF DISTRIBUTION


 


Each broker-dealer that receives Exchange Securities
for its own account pursuant to the Exchange Offer must acknowledge that it
will deliver a prospectus in connection with any resale of such Exchange
Securities.  This Prospectus, as it may
be amended or supplemented from time to time, may be used by a broker-dealer in
connection with resales of Exchange Securities received in exchange for Initial
Securities where such Initial Securities were acquired as a result of
market-making activities or other trading activities.  The Company and the Guarantors, if any, have agreed that, for a
period of 180 days after the Expiration Date, they will make this
prospectus, as amended or supplemented, available to any broker-dealer for use
in connection with any such resale.  In
addition,
until                     ,
2003, all dealers effecting transactions in the Exchange Securities may be
required to deliver a prospectus.(1)


 


Neither the Company nor
the Guarantors, if any, will receive any proceeds from any sale of Exchange
Securities by broker-dealers. 
Exchange Securities received by broker-dealers for their own account
pursuant to the Exchange Offer may be sold from time to time in one or more
transactions in the over-the-counter market, in negotiated transactions, through
the writing of options on the Exchange Securities or a combination of such
methods of resale, at market prices prevailing at the time of resale, at prices
related to such prevailing market prices or negotiated prices.  Any such resale may be made directly to
purchasers or to or through brokers or dealers who may receive compensation in
the form of commissions or concessions from any such broker-dealer or the
purchasers of any such Exchange Securities. 
Any broker-dealer that resells Exchange Securities that were received by
it for its own account pursuant to the Exchange Offer and any broker or dealer
that participates in a distribution of such Exchange Securities may be deemed
to be an “underwriter” within the meaning of the Securities Act and any profit
on any such resale of Exchange Securities and any commission or concessions
received by any such persons may be deemed to be underwriting compensation
under the Securities Act.  The Letter of
Transmittal states that, by acknowledging that it will deliver and by
delivering a prospectus, a broker-dealer will not be deemed to admit that it is
an “underwriter” within the meaning of the Securities Act.


 


For a period of
180 days after the Expiration Date the Company will promptly send
additional copies of this Prospectus and any amendment or supplement to this
Prospectus to any broker-dealer that requests such documents in the Letter of
Transmittal.  The Company and the
Guarantors, if any, have agreed to pay all expenses incident to the Exchange
Offer (including the expenses of one counsel for the Holders of the Securities)
other than commissions or concessions of any brokers or dealers and will
indemnify the Holders of the Securities (including any broker-dealers) against
certain liabilities, including liabilities under the Securities Act.


 












(1)  In addition, the legend
required by Item 502(c) of Regulation S-K will appear on the back cover page of
the Exchange Offer prospectus.

















 


ANNEX D


 


o            CHECK
HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE 10 ADDITIONAL COPIES OF THE
PROSPECTUS AND 10 COPIES OF ANY AMENDMENTS OR SUPPLEMENTS THERETO.


 


	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Address:

  	
   

  	
   

  



 


 


If the undersigned is not a broker-dealer, the undersigned represents
that it is not engaged in, and does not intend to engage in, a distribution of
Exchange Securities.  If the undersigned
is a broker-dealer that will receive Exchange Securities for its own account in
exchange for Initial Securities that were acquired as a result of market-making
activities or other trading activities, it acknowledges that it will deliver a
prospectus in connection with any resale of such Exchange Securities; however,
by so acknowledging and by delivering a prospectus, the undersigned will not be
deemed to admit that it is an “underwriter” within the meaning of the
Securities Act.


 


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