EX-4.2



 





Exhibit 4.2




REGISTRATION RIGHTS AGREEMENT




Dated as of May 25, 2007




by and among




RCN CORPORATION




as the Company,




and




the Holders,




as defined herein.





 









 








TABLE OF CONTENTS




	 	 	 	 	 
	1. Definitions
	 	 	1	 
	 
	 	 	 	 
	2. Shelf Registration
	 	 	4	 
	 
	 	 	 	 
	3. Additional Payment
	 	 	6	 
	 
	 	 	 	 
	4. Registration Procedures
	 	 	8	 
	 
	 	 	 	 
	5. Registration Expenses.
	 	 	14	 
	 
	 	 	 	 
	6. Indemnification
	 	 	16	 
	 
	 	 	 	 
	7. Rules 144 and 144A
	 	 	20	 
	 
	 	 	 	 
	8. Underwritten Registrations
	 	 	20	 
	 
	 	 	 	 
	9. Miscellaneous
	 	 	21	 







i









 








REGISTRATION RIGHTS AGREEMENT




     This Registration Rights Agreement (this “Agreement”) is dated as of May 25, 2007, and
entered into by and among RCN Corporation, a Delaware corporation (the “Company”), and the
institutional investors whose names and addresses are listed on Schedule I and Schedule II hereto
(each, together with their respective successors, assigns and transferees, a “Holder” and
collectively, the “Holders”).



     WHEREAS, on the date hereof, the Company is effecting a transaction in accordance with the
terms of the Warrant Agreement, dated as of May 25, 2007, among the Company and HSBC Bank USA,
National Association, as Warrant Agent (the “Warrant Agreement”);



     WHEREAS, each Warrant represents the right to purchase one share of common stock of the
Company, par value $0.01 per share (the “Underlying Shares”).



     In order to induce each Holder to enter into the Warrant Agreement, the Company has agreed to
provide the registration rights set forth in this Agreement for the benefit of the Holders and
certain subsequent holder or holders of the Warrants or Underlying Shares as provided herein.



     The parties hereby agree as follows:



     1. Definitions. As used in this Agreement, the following terms shall have the following
meanings:



     “Agreement” shall have the meaning set forth in the first introductory paragraph
hereto.



     “Amendment Effectiveness Deadline Date” shall have the meaning set forth in Section
2(d)(i) hereto.



     “Amount of Registrable Securities” shall mean (a) with respect to Underlying Shares
constituting Registrable Securities, the aggregate number of all such Underlying Shares
outstanding, (b) with respect to Warrants constituting Registrable Securities, the aggregate number
of Underlying Shares issuable upon the exercise of the Warrants and payment of the Exercise Price
(as defined in the Warrant Agreement) in effect at the time of computing the Amount of Registrable
Securities, and (c) with respect to combinations thereof, the sum of (a) and (b) for the relevant
Registrable Securities.



     “Business Day” shall mean any day that is not a Saturday, Sunday or a day on which
banking institutions in New York City are authorized or required by law to be closed.



     “Closing Date” shall mean May 25, 2007.



 









 





     “Company” shall have the meaning set forth in the first introductory paragraph hereto
and includes the Company’s successors and assigns.



     “Controlling Person” shall have the meaning set forth in Section 7 hereof.



     “Depositary” shall mean The Depository Trust Company or any successor that is
appointed by the Company; provided, however, that such depositary must have an address in the
Borough of Manhattan, in The City of New York.



     “Designated Counsel” shall mean one firm of counsel chosen by the Holders of a
majority in Amount of Registrable Securities to be included in a Registration Statement for a Shelf
Registration and identified to the Company in writing prior to the filing of such Registration
Statement.



     “Effectiveness Date” shall mean the date that is the 90th day after the date the
Initial Shelf Registration is filed with the SEC.



     “Effectiveness Period” shall have the meaning set forth in Section 2(a) hereof.



     “End of Suspension Notice” shall have the meaning set forth in Section 6(b) hereof.



     “Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, and the
rules and regulations of the SEC promulgated thereunder.



     “Filing Date” shall mean the date that is 90 days after the issuance of the Warrants.



     “Guarantors” shall have the meaning set forth in the second introductory paragraph
hereto.



     “Holder” shall have the meaning set forth in the first introductory paragraph hereto,
and shall include any holder of Registrable Securities.



     “Indemnified Holder” shall have the meaning set forth in Section 7 hereof.



     “Indemnified Person” shall have the meaning set forth in Section 7 hereof.



     “Indemnifying Person” shall have the meaning set forth in Section 7 hereof.



     “Initial Shelf Registration” shall have the meaning set forth in Section 2(a) hereof.



     “Inspectors” shall have the meaning set forth in Section 4(m) hereof.



     “NASD” shall have the meaning set forth in Section 4(p) hereof.



     “Notes” shall have the meaning set forth in the second introductory paragraph hereto.



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     “Notice and Questionnaire” shall mean a written notice delivered to the Company
containing substantially the information called for by the Form of Selling Securityholder Notice
and Questionnaire attached hereto as Appendix A.



     “Person” shall mean an individual, partnership, corporation, limited liability
company, unincorporated association, trust or joint venture, or a governmental agency or political
subdivision thereof.



     “Prospectus” shall mean the prospectus included in any Registration Statement
(including, without limitation, any prospectus subject to completion and a prospectus that includes
any information previously omitted from a prospectus filed as part of an effective registration
statement in reliance upon Rule 430A promulgated under the Securities Act), as amended or
supplemented by any prospectus supplement, and all other amendments and supplements to the
Prospectus, including post-effective amendments, and all material incorporated by reference or
deemed to be incorporated by reference in such Prospectus.



     “QIU” shall have the meaning set forth in Section 4(p) hereof.



     “Records” shall have the meaning set forth in Section 4(m) hereof.



     “Registrable Securities” shall mean all Warrants and all Underlying Shares upon
original issuance thereof and at all times subsequent thereto until the earliest to occur of (i) a
Registration Statement covering such Warrants and Underlying Shares having been declared effective
by the SEC and such Underlying Shares having been disposed of in accordance with such effective
Registration Statement, (ii) such Warrants and Underlying Shares having been sold in compliance
with Rule 144 (without giving any effect to Rule 144(k)), (iii) such Warrants and any Underlying
Shares ceasing to be outstanding or (iv) the third anniversary after the initial effective date of
such Registration Statement (subject to extension as provided in Section 2 hereof).



     “Registration Statement” shall mean any registration statement of the Company filed
with the SEC pursuant to the provisions of this Agreement, including the Prospectus, amendments and
supplements to such registration statement, including post-effective amendments, all exhibits and
all documents incorporated by reference or deemed to be incorporated by reference in such
registration statement.



     “Rule 144” shall mean Rule 144 promulgated under the Securities Act, as such rule may
be amended from time to time, or any similar rule (other than Rule 144A) or regulation hereafter
adopted by the SEC providing for offers and sales of securities made in compliance therewith
resulting in offers and sales by subsequent holders that are not affiliates of an issuer of such
securities being free of the registration and prospectus delivery requirements of the Securities
Act.



     “Rule 144A” shall mean Rule 144A promulgated under the Securities Act, as such rule
may be amended from time to time, or any similar rule (other than Rule 144) or regulation hereafter
adopted by the SEC.



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     “Rule 415” shall mean Rule 415 promulgated under the Securities Act, as such rule may
be amended from time to time, or any similar rule or regulation hereafter adopted by the SEC.



     “SEC” shall mean the Securities and Exchange Commission.



     “Securities Act” shall mean the Securities Act of 1933, as amended, and the rules and
regulations of the SEC promulgated thereunder.



     “Selling Holder” shall mean, on any date, any Holder that has delivered a Notice and
Questionnaire to the Company on or prior to such date.



     “Shelf Registration” shall have the meaning set forth in Section 2(b) hereof.



     “Shelf Registration Statement” shall have the meaning set forth in Section 2(b)
hereof.



     “Subsequent Shelf Registration” shall have the meaning set forth in Section 2(b)
hereof.



     “Suspension Event” shall have the meaning set forth in Section 6(b) hereof.



     “Suspension Notice” shall have the meaning set forth in Section 6(b) hereof.



     “Underlying Shares” shall have the meaning set forth in the second introductory
paragraph hereto.



     “Underwritten Registration” or “Underwritten Offering” shall mean a
registration in which securities of the Company are sold to an underwriter for reoffering to the
public.



     “Warrant” shall mean each warrant issued to the Holders on the date hereof,
exercisable for one share of the common stock of the Company, as may be adjusted from time to time
pursuant to the terms of the Warrant Agreement.



     “Warrant Agent” shall mean the Warrant Agent under the Warrant Agreement.



     “Warrant Agreement” shall have the meaning set forth in the second introductory
paragraph hereto.



     2. Shelf Registration.



          (a) Shelf Registration. The Company shall file with the SEC a “shelf” Registration
Statement for an offering to be made on a continuous basis pursuant to Rule 415 covering all of the
Registrable Securities (the “Initial Shelf Registration”) on or prior to the Filing Date.




     The Initial Shelf Registration shall be on Form S-1, Form S-3 or another appropriate form
permitting registration of such Registrable Securities for resale by Holders in the manner or
manners designated by them (including, without limitation, one



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or more Underwritten Offerings;
provided, that the lead or managing underwriter in any Underwritten Offerings shall be reasonably
acceptable to the Company). The Company may permit securities other than the Registrable Securities
to be included in the Initial Shelf Registration or any Subsequent Shelf Registration; provided,
however, that to the extent that any securities may not be included on any such registration for
any reason, no securities other than Registrable Securities shall be included therein unless all
Registered Securities requested to be included therein are so included.



     The Company shall use its commercially reasonable efforts to cause the Initial Shelf
Registration to be declared effective under the Securities Act on or prior to the Effectiveness
Date and to keep such Initial Shelf Registration continuously effective under the Securities Act
until the date that is three (3) years after the Effectiveness Date, provided such period shall
automatically be extended to the extent required to permit brokers and dealers to comply with Rule
174 under the Securities Act, as provided in Section 6 hereof or as otherwise provided
herein (such period, as it may be extended or shortened pursuant to this Agreement, the
“Effectiveness Period”), or such shorter period ending when no Registrable Securities
continue to be outstanding.



          (b) Subsequent Shelf Registrations. If the Initial Shelf Registration or any
Subsequent Shelf Registration ceases to be effective for any reason at any time during the
Effectiveness Period (other than because of the sale of all of the securities registered
thereunder), the Company shall use its commercially reasonable efforts to obtain the prompt
withdrawal of any order suspending the effectiveness thereof, and in any event shall within
forty-five (45) days of such cessation of effectiveness amend the Initial Shelf Registration in a
manner to obtain the withdrawal of the order suspending the effectiveness thereof, or file an
additional “shelf” Registration Statement pursuant to Rule 415 covering all of the Registrable
Securities (a “Subsequent Shelf Registration”). If a Subsequent Shelf Registration is
filed, the Company shall use its commercially reasonable efforts to cause the Subsequent Shelf
Registration to be declared effective under the Securities Act as soon as practicable after such
filing and to keep such Registration Statement continuously effective for a period equal to the
number of days in the Effectiveness Period less the aggregate number of days during which the
Initial Shelf Registration or any Subsequent Shelf Registration was previously continuously
effective. As used herein, the term “Shelf Registration” means the Initial Shelf Registration and
any Subsequent Shelf Registration and the term “Shelf Registration Statement” means any
Registration Statement filed in connection with a Shelf Registration.




          (c) Supplements and Amendments. The Company shall promptly supplement and amend the
Shelf Registration if required by the rules, regulations or instructions applicable to the
registration form used for such Shelf Registration, if required by the Securities Act, or, in the
reasonable discretion of the Company, if reasonably requested by the Holders of the majority in
Amount of Registrable Securities covered by such Registration Statement or by any underwriter of
such Registrable Securities; provided, however, that the Company shall not be
required to supplement or
amend the Shelf Registration Statement during the occurrence of any of the events described in
Section 6(a)(i) or (ii).




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          (d) Notice and Questionnaire. Each Holder agrees that if such Holder wishes to sell
Registrable Securities pursuant to a Shelf Registration Statement and related Prospectus, it will
do so only in accordance with this Section 2(d) and Section 4 hereof. Each Holder
wishing to sell Registrable Securities pursuant to a Shelf Registration Statement and related
Prospectus agrees to deliver a Notice and Questionnaire to the Company at least five (5) Business
Days prior to any intended distribution of Registrable Securities under the Shelf Registration
Statement. From and after the date the Initial Shelf Registration Statement is declared effective,
the Company shall, as promptly as practicable after the date a Notice and Questionnaire is
delivered, and in any event upon five (5) Business Days after such date:





     (i) if required by applicable law, file with the SEC a post-effective
amendment to the Shelf Registration Statement or prepare and, if required by
applicable law, file a supplement to the related Prospectus or a supplement or
amendment to any document incorporated therein by reference or file any other
required document so that the Holder delivering such Notice and Questionnaire is
named as a selling securityholder in the Shelf Registration Statement and the
related Prospectus in such a manner as to permit such Holder to deliver such
Prospectus to purchasers of the Registrable Securities in accordance with
applicable law and, if the Company shall file a post-effective amendment to the
Shelf Registration Statement, use its commercially reasonable efforts to cause such
post-effective amendment to be declared effective under the Securities Act as
promptly as is practicable, but in any event by the date (the “Amendment
Effectiveness Deadline Date”) that is forty-five (45) days after the date such
post-effective amendment is required by this clause to be filed; provided,
however, that such period shall be tolled for so long as information
provided by or requested to be provided by any such Holder is reasonably likely to
prevent the effectiveness of any such post-effective amendment or supplement;




     (ii) provide such Holder copies of any documents filed pursuant to Section
2(d)(i); and




     (iii) notify such Holder as promptly as practicable after the effectiveness
under the Securities Act of any post-effective amendment filed pursuant to
Section 2(d)(i). Notwithstanding anything contained herein to the contrary,
the Company shall be under no obligation to name any Holder that has not delivered
a complete Notice and Questionnaire in accordance with this Section 2(d)
and such other information to the Company as required by Section 4(r)
hereof.



     3. Additional Payment . The Company agrees that the Holders will suffer damages
if the Company fails to fulfill certain
of its obligations under Section 2 hereof or otherwise permits certain circumstances to
exist and that it would not be feasible to ascertain the extent of such damages with precision.
Accordingly, the Company agrees to



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pay an additional amount of consideration under the
circumstances and to the extent set forth below:




     (i) if the Initial Shelf Registration is not declared effective by the SEC on
the earlier to occur of the Effectiveness Date or 180 days after the issuance of
the Warrants, then on the second Business Day immediately following such date (the
“Initial Shelf Payment Date”), the Company shall pay to each Holder an
amount equal to the Additional Payment (as defined below);




     (ii) if the Initial Shelf Registration is not declared effective by the SEC on
or prior to the end of each subsequent 30-day period following the Initial Shelf
Payment Date, then on each such 30th day, the Company shall promptly pay
to each Holder an amount equal to the Additional Payment; and




     (iii) if a Shelf Registration has been declared effective and such Shelf
Registration ceases to be effective at any time during the Effectiveness Period (a
“Default Shelf”), then on the second Business Day immediately following the
date such Shelf Registration ceases to be effective (the “Shelf Default
Date”), the Company shall pay to each Holder an amount equal to the Additional
Payment; and




     (iv) if the Default Shelf described in clause (iii) above is not declared
effective by the SEC on or prior to the end of each subsequent 30-day period
following the Shelf Default Date, then on each such 30th day, the
Company shall promptly pay to each Holder an amount equal to the Additional
Payment.



          (b) For purposes of this Section, “Additional Payment” shall mean with respect to each
Holder, an amount equal to the product of (x) $60,000 multiplied by (y) a fraction:





the numerator of which shall equal (A) in the case of Sections
3(a)(i) and 3(a)(ii), the aggregate number of Registrable
Securities held by such Holder on the Initial Shelf Payment Date or (B) in
the case of Sections 3(a)(iii) and 3(a)(iv), the aggregate
number of Registrable Securities held by such Holder on the Shelf Default
Date,




and




the denominator of which shall equal the aggregate number of Registrable
Securities held by all Holders on the Initial Shelf Payment Date.



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          (c) Notwithstanding the foregoing, the maximum aggregate amount of Additional Payments by the
Company to all Holders pursuant to this Section 3 shall not exceed $1,000,000.00.




     4. Registration Procedures. In connection with the filing of any Registration Statement
pursuant to Section 2 hereof, the Company shall effect such registrations to permit the
sale of the securities covered thereby in accordance with the intended method or methods of
disposition thereof, and pursuant thereto and in connection with any Registration Statement filed
by the Company hereunder the Company shall:



          (a) Prepare and file with the SEC, on or prior to the Filing Date, a Registration Statement or
Registration Statements as prescribed by Section 2 hereof, and use its commercially
reasonable efforts to cause each such Registration Statement to become effective and remain
effective as provided herein; provided, however, that before filing any
Registration Statement or Prospectus or any amendments or supplements thereto, the Company shall
furnish to and afford the Holders of the Registrable Securities covered by such Registration
Statement and the managing underwriter or underwriters, if any, a reasonable opportunity to review
copies of all such documents proposed to be filed (in each case, where possible, at least three (3)
Business Days prior to such filing, or such later date as is reasonable under the circumstances).
The Company shall not file any Registration Statement or Prospectus or any amendments or
supplements thereto if the Holders of a majority in Amount of Registrable Securities covered by
such Registration Statement or the managing underwriter or underwriters, if any, shall reasonably
object in writing within such period.




          (b) Prepare and file with the SEC such amendments and post-effective amendments to each Shelf
Registration, as may be necessary to keep such Registration Statement continuously effective for
the Effectiveness Period; cause the related Prospectus to be supplemented by any Prospectus
supplement required by applicable law, and as so supplemented to be filed pursuant to Rule 424 (or
any similar provisions then in force) promulgated under the Securities Act; and comply with the
provisions of the Securities Act and the Exchange Act applicable to it with respect to the
disposition of all Registrable Securities covered by such Registration Statement as so amended or
in such Prospectus as so supplemented.




          (c) Notify the Selling Holders, Designated Counsel, if any, and the managing underwriter or
underwriters, if any, promptly (but in any event within two (2) Business Days), (i) when a
Prospectus or any prospectus supplement or post-effective amendment has been filed, and, with
respect to a Registration Statement or any post-effective amendment, when the same has become
effective under the Securities Act (including in such notice a written statement that any Holder
may, upon request, obtain,
at the sole expense of the Company, conformed copies of such Registration Statement or
post-effective amendment including financial statements and schedules, documents incorporated or
deemed to be incorporated by reference and exhibits), (ii) of the issuance by the SEC of any stop
order suspending the effectiveness of a Registration Statement or of any order preventing or
suspending the use of any preliminary prospectus or the initiation of any proceedings for that
purpose, (iii) of the happening of any event, the




-8-









 







existence of any condition or any information
becoming known that makes any statement made in such Registration Statement or related Prospectus
or any document incorporated or deemed to be incorporated therein by reference untrue in any
material respect or that requires the making of any changes in or amendments or supplements to such
Registration Statement, Prospectus or documents so that, in the case of the Registration Statement,
it will not contain any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements therein not misleading, and that
in the case of the Prospectus, it will not contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not misleading and (iv) of
the Company’s determination that a post-effective amendment to a Registration Statement would be
appropriate.




          (d) Use its commercially reasonable efforts to prevent the issuance of any order suspending
the effectiveness of a Registration Statement or of any order preventing or suspending the use of a
Prospectus and, if any such order is issued, to use its commercially reasonable efforts to obtain
the withdrawal of any such order at the earliest possible moment, and provide prompt notice to the
Selling Holders, Designated Counsel, if any, and the managing underwriter or underwriters, if any,
of the withdrawal of any such order.




          (e) If requested by the managing underwriter or underwriters, if any, or the Holders of the
majority in Amount of Registrable Securities being sold in connection with an underwritten offering
and reasonably acceptable to the Company (i) promptly incorporate in a prospectus supplement or
post-effective amendment such information as the managing underwriter or underwriters, if any, or
such Holders reasonably determine, in consultation with the Company, is necessary to be included
therein, (ii) make all required filings of such prospectus supplement or such post-effective
amendment as soon as reasonably practicable after the Company has received notification of the
matters to be incorporated in such prospectus supplement or post-effective amendment and (iii)
supplement or make amendments to such Registration Statement.




          (f) Furnish to each Selling Holder, Designated Counsel, if any, and the managing underwriter
or underwriters, if any, at the sole expense of the Company, conformed copies of the Registration
Statement or Registration Statements and each post-effective amendment thereto, including financial
statements and schedules, and, if requested, all documents incorporated or deemed to be
incorporated therein by reference and all exhibits.




          (g) Deliver to each Selling Holder, Designated Counsel, if any, and the managing underwriter
or underwriters, if any, at the sole expense of the Company, as many copies of the Prospectus
(including each form of preliminary prospectus) and each amendment or supplement thereto and any
documents incorporated by reference therein as such Persons may reasonably request; and the Company
hereby consents to the use of such Prospectus and each amendment or supplement thereto by each of
the Selling Holders of Registrable Securities, the managing underwriter or underwriters, if any,
and

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dealers, if any, in connection with the offering and sale of the Registrable Securities covered
by such Prospectus and any amendment or supplement thereto.




          (h) The Company agrees to cause the Company’s counsel to perform blue sky investigations and
file registrations and qualifications required to be filed in connection with the registration or
qualification (or exemption from such registration or qualification) of such Registrable Securities
or offer and sale under the securities or blue sky laws of such jurisdictions within the United
States as any Selling Holder or the managing underwriter or underwriters, if any, reasonably
request, keep each such registration or qualification (or exemption therefrom) effective during the
period such Registration Statement is required to be kept effective and do any and all other acts
or things reasonably necessary or advisable under blue sky laws to enable the disposition in such
jurisdictions of the Registrable Securities covered by the applicable Registration Statement;
provided, however, that the Company shall not be required to (A) qualify generally
to do business in any jurisdiction where it is not then so qualified, or (B) subject itself to
taxation in any such jurisdiction where it is not then so subject.




          (i) Cooperate with the Selling Holders, the managing underwriter or underwriters, if any, and
their respective counsel to facilitate the timely preparation and delivery of certificates
representing shares of Registrable Securities to be sold, which certificates shall not bear any
restrictive legends and shall be in a form eligible for deposit with the Depositary; and enable
such shares of Registrable Securities to be in such denominations and registered in such names as
the managing underwriter or underwriters, if any, or Holders may reasonably request.




          (j) Upon the occurrence of any event contemplated by Section 4(c)(ii),
4(c)(iii) or 4(c)(iv) hereof, as promptly as practicable prepare and (subject to
Section 4(a) hereof) file with the SEC, at the sole expense of the Company, a supplement or
post-effective amendment to the Registration Statement or a supplement to the related Prospectus or
any document incorporated or deemed to be incorporated therein by reference, or file any other
required document so that, as thereafter delivered to the purchasers of the Registrable Securities
being sold thereunder, any such Prospectus will not contain an untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not misleading.




          (k) Prior to the effective date of the first Registration Statement relating to the
Registrable Securities, (i) provide the Warrant Agent with certificates for the Registrable
Securities in a form eligible for deposit with the Depositary and (ii) provide CUSIP numbers for
the Registrable Securities.




          (l) In connection with any underwritten offering of Registrable Securities pursuant to a Shelf
Registration, enter into an underwriting agreement, reasonably satisfactory in form and substance
to the Company, as is customary in underwritten offerings of securities similar to the Registrable
Securities and take all such other actions as are reasonably requested by the managing underwriter
or underwriters in order to expedite or facilitate the registration or the disposition of such
Registrable

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Securities and, in such connection, (i) make such representations and warranties to,
and covenants with, the managing underwriter or underwriters with respect to the business of the
Company and its subsidiaries (including any acquired business, properties or entity, if applicable)
and the Registration Statement, Prospectus and documents, if any, incorporated or deemed to be
incorporated by reference therein, in each case, as are customarily made by issuers to underwriters
in underwritten offerings of securities similar to the Registrable Securities and confirm the same
in writing if and when requested; (ii) obtain the written opinion of counsel to the Company and
written updates thereof in form, scope and substance reasonably satisfactory to the managing
underwriter or underwriters, addressed to the managing underwriter or underwriters covering the
matters customarily covered in opinions requested in underwritten offerings of securities similar
to the Registrable Securities and such other matters as may be reasonably requested by the managing
underwriter or underwriters; (iii) obtain “cold comfort” letters and updates thereof in form, scope
and substance reasonably satisfactory to the managing underwriter or underwriters from the
independent certified public accountants of the Company (and, if necessary, any other independent
certified public accountants of any subsidiary of the Company or of any business acquired by the
Company for which financial statements and financial data are, or are required to be, included or
incorporated by reference in the Registration Statement), addressed to each of the underwriters,
such letters to be in customary form and covering matters of the type customarily covered in “cold
comfort” letters in connection with underwritten offerings of securities similar to the Registrable
Securities and such other matters as reasonably requested by the managing underwriter or
underwriters; and (iv) if an underwriting agreement is entered into, cause the same to contain
indemnification provisions and procedures no less favorable to the sellers and underwriters, if
any, than those set forth in Section 7 hereof (or such other provisions and procedures
acceptable to Holders of a majority in aggregate principal amount of Registrable Securities covered
by such Registration Statement and the managing underwriter or underwriters or agents, if any). The
above shall be done as and to the extent required by such underwriting agreement.




          (m) Make available at reasonable times for inspection by one or more representatives of the
Selling Holders, designated in writing by Holders of a majority in Amount of Registrable Securities
to be included in such Registration Statement of such Registrable Securities being sold, any
managing underwriter or underwriters participating in any such disposition of Registrable
Securities, if any, and any attorney, accountant or other agent retained by any such Selling Holder
or underwriter (collectively, the “Inspectors”), at the offices where normally kept, during
reasonable business hours at such time or times as shall be mutually convenient for the Company and
the Inspectors as a group, all financial and other records, pertinent corporate documents and
instruments of the Company and its subsidiaries (collectively, the “Records”) as shall be
reasonably necessary to enable them to exercise any applicable due diligence responsibilities, and
cause the officers, directors and employees of the Company and its subsidiaries to supply all
information reasonably requested by any such Inspector in connection with such Registration
Statement. Records that the Company determines, in good faith, to be confidential and any Records
that it notifies the Inspectors are confidential shall not be disclosed by any Inspector unless (i)
the disclosure of such Records is necessary to avoid or correct a material misstatement or material
omission in such Registration Statement,

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(ii) the release of such Records is ordered pursuant to a
subpoena or other order from a court of competent jurisdiction, (iii) disclosure of such
information is, in the opinion of counsel for any Inspector, necessary or advisable in connection
with any action, claim, suit or proceeding, directly involving or potentially involving such
Inspector and arising out of, based upon, relating to, or involving this Agreement or any
transactions contemplated hereby or arising hereunder or (iv) the information in such Records has
been made generally available to the public other than through the acts of such Inspector;
provided, however, that prior notice shall be provided as soon as practicable to
the Company of the potential disclosure of any information by such Inspector pursuant to clauses
(ii) or (iii) of this sentence to permit the Company to obtain a protective order (or waive the
provisions of this paragraph (m)). Each Inspector shall take such actions as are reasonably
necessary to protect the confidentiality of such information (if practicable) to the extent such
actions are otherwise not inconsistent with, an impairment of or in derogation of the rights and
interests of the Holder or any Inspector, unless and until such information in such Records has
been made generally available to the public other than as a result of a breach of this Agreement.




          (n) Provide (i) the Holders of the Registrable Securities to be included in such Registration
Statement and Designated Counsel, if any, (ii) the underwriters (which term, for purposes of this
Registration Rights Agreement, shall include a Person deemed to be an underwriter within the
meaning of Section 2(11) of the Securities Act), if any, thereof, (iii) the sales or
placement agent, if any, thereof, and (iv) one counsel for such underwriters or agents, reasonable
opportunity to participate in the preparation of such Registration Statement, each prospectus
included therein or filed with the SEC, and each amendment or supplement thereto.




          (o) Comply with all applicable rules and regulations of the SEC and make generally available
to its security holders earning statements satisfying the provisions of Section 11(a) of
the Securities Act and Rule 158 thereunder (or any similar rule promulgated under the Securities
Act) no later than forty-five (45) days after the end of any twelve (12)-month period (or ninety
(90) days after the end of any twelve (12)-month period if such period is a fiscal year) (i)
commencing at the end of any fiscal quarter in which Registrable Securities are sold to
underwriters in a firm commitment or commercially reasonable efforts underwritten offering and (ii)
if not sold to underwriters in such an offering, commencing on the first day of the first fiscal
quarter of the Company after the effective date of a Registration Statement, which statements shall
cover said twelve (12)-month periods.




          (p) Cooperate with each Selling Holder of Registrable Securities covered by any Registration
Statement and the managing underwriter or underwriters, if any, participating in the disposition of
such Registrable Securities and their respective
counsel in connection with any filings required to be made with the NASD (the “NASD”),
including, if the Conduct Rules of the NASD or any successor thereto as amended from time to time
so require, engaging a “qualified independent underwriter” (“QIU”) as contemplated therein
and making Records available to such QIU as though it were a participating underwriter for the
purposes of Section 4(m) and otherwise applying

-12-









 








the provisions of this Agreement to such
QIU (including indemnification) as though it were a participating underwriter.




          (q) [intentionally omitted]




          (r) Use its commercially reasonable efforts to take all other steps necessary or advisable to
effect the registration of the Registrable Securities covered by a Registration Statement
contemplated hereby.




     Each Holder agrees, by acquisition of the Registrable Securities, that no Holder shall be
entitled to sell any of such Registrable Securities pursuant to a Registration Statement or to
receive a Prospectus relating thereto, unless such Holder has furnished the Company with a Notice
and Questionnaire as required pursuant to Section 2(d) hereof (including the information
required to be included in such Notice and Questionnaire) and the information set forth in the next
sentence. Each Selling Holder agrees promptly to furnish to the Company all information required to
be disclosed in order to make the information previously furnished to the Company by such Selling
Holder not misleading and any other information regarding such Selling Holder and the distribution
of such Registrable Securities as the Company may from time to time reasonably request. Any sale of
any Registrable Securities by any Holder shall constitute a representation and warranty by such
Holder that the information relating to such Holder and its plan of distribution is as set forth in
the Prospectus delivered by such Holder in connection with such disposition, that such Prospectus
does not as of the time of such sale contain any untrue statement of a material fact relating to or
provided by such Holder or its plan of distribution and that such Prospectus does not as of the
time of such sale omit to state any material fact relating to or provided by such Holder or its
plan of distribution necessary to make the statements in such Prospectus, in the light of the
circumstances under which they were made, not misleading.



     The Company may require each Selling Holder of Registrable Securities as to which any
registration is being effected to furnish to the Company such additional information regarding such
Holder and the distribution of such Registrable Securities as the Company may, from time to time,
reasonably request to the extent necessary or advisable to comply with the Securities Act. The
Company may exclude from such registration the Registrable Securities of any Selling Holder if such
Holder fails to furnish such additional information within twenty (20) Business Days after
receiving such request. Each Selling Holder as to which any Shelf Registration is being effected
agrees to furnish promptly to the Company all information required to be disclosed so that the
information previously furnished to the Company by such Holder is not materially misleading and
does not omit to state any material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances under which they were made.



     Each Holder of Registrable Securities agrees by acquisition of such Registrable Securities
that upon the happening of any event of the kind described in Section 4(c)(ii), 4(c)(iii) or
4(c)(iv) hereof, such Holder will forthwith discontinue disposition of such Registrable Securities
covered by such Registration Statement or Prospectus until such



-13-









 







Holder’s receipt of the copies of
the supplemented or amended Prospectus contemplated by Section 4(j) hereof, or until it is advised
in writing by the Company that the use of the applicable Prospectus may be resumed, and has
received copies of any amendments or supplements thereto.



     5. Registration Expenses.



          (a) All fees and expenses incident to the performance of or compliance with this Agreement by
the Company shall be borne by the Company, including, without limitation, (i) all registration and
filing fees (including, without limitation, (A) fees with respect to filings required to be made
with the NASD in connection with an underwritten offering and (B) fees and expenses of compliance
with state securities or blue sky laws, including, without limitation, reasonable fees and
disbursements of counsel in connection with blue sky qualifications of the Registrable Securities
and determination of the eligibility of the Registrable Securities for investment under the laws of
such jurisdictions as provided in Section 4(h) hereof), (ii) printing expenses, including,
without limitation, expenses of printing certificates for Registrable Securities in a form eligible
for deposit with the Depositary and of printing prospectuses if the printing of prospectuses is
requested by the managing underwriter or underwriters, if any, or by the Holders of the majority in
Amount of Registrable Securities included in any Registration Statement, (iii) messenger, telephone
and delivery expenses, (iv) fees and disbursements of counsel for the Company, (v) fees and
disbursements of all independent certified public accountants referred to in Section
4(l)(iii) hereof (including, without limitation, the expenses of any special audit and “cold
comfort” letters required by or incident to such performance), (vi) Securities Act liability
insurance, if the Company desires such insurance, (vii) fees and expenses of all other Persons
retained by the Company, (viii) internal expenses of the Company (including, without limitation,
all salaries and expenses of officers and employees of the Company performing legal or accounting
duties), (ix) the expense of any annual audit, (x) the fees and expenses incurred in connection
with the listing of the securities to be registered on any securities exchange, if applicable, and
(xi) the expenses relating to printing, word processing and distributing all Registration
Statements, underwriting agreements, securities sales agreements and any other documents necessary
in order to comply with this Agreement. Notwithstanding anything in this Agreement to the contrary,
each Holder shall pay all underwriting discounts and brokerage commissions with respect to any
Registrable Securities sold by it and, except as set forth in Section 5(b) below the
Company shall not be responsible for the fees and expenses of any counsel for the Holders.




          (b) The Company shall reimburse the Holders of the Registrable Securities being registered in
a Shelf Registration for the reasonable fees and disbursements, not to exceed $75,000, of
Designated Counsel.




          (c) Black-Out Period. Subject to the provisions of this Section 6 and a good
faith determination by a majority of the members of the Board of Directors of the Company that it
is in the best interests of the Company to suspend the use of the Registration Statement, following
the effectiveness of a Registration Statement (and the filings with any international, federal or
state securities commissions), the Company, by

-14-









 








written notice to the Holders, may direct the
Holders to suspend sales of the Registrable Securities pursuant to a Registration Statement for
such times as the Company reasonably may determine is necessary and advisable (but in no event for
more than an aggregate of sixty (60)-days in any rolling twelve (12)-month period commencing on the
Closing Date, or thirty (30)-days in any rolling ninety (90)-day period, and no more than two (2)
separate times in any rolling 12 month period) if any of the following events shall occur: (i) a
primary Underwritten Offering by the Company where the Company is advised by the representative of
the managing underwriters for such Underwritten Offering that the sale of Registrable Securities
pursuant to the Registration Statement would have a material adverse effect on the Company’s
Underwritten Offering; (ii) a majority of the members of the Board of Directors of the Company in
good faith determine that (A) the offer or sale of any Registrable Securities would materially
impede, delay or interfere with any material proposed acquisition, merger, tender offer, business
combination, corporate reorganization, consolidation or other similar material transaction
involving the Company, (B) after the advice of counsel, sale of Registrable Securities pursuant to
the Registration Statement would require disclosure of non-public material information not
otherwise required to be disclosed under applicable law, and (C) disclosure could have a material
adverse effect on the Company or the Company’s ability to consummate such transaction in each case
under circumstances that would make it impracticable or inadvisable to cause the Registration
Statement (or such filings) to become effective or to promptly amend or supplement the Registration
Statement on a post-effective basis, as applicable; or (iii) a majority of the members of the Board
of Directors of the Company shall have determined in good faith, after the advice of counsel, that
it is required by law, rule or regulation to supplement the Registration Statement or file a
post-effective amendment to the Registration Statement in order to incorporate information into the
Registration Statement for the purpose of (A) including in the Registration Statement any
Prospectus required under Section 10(a)(3) of the Securities Act; (B) reflecting in the
Prospectus included in the Registration Statement any facts or events arising after the effective
date of the Registration Statement (or of the most-recent post-effective amendment) that,
individually or in the aggregate, represents a fundamental change in the information set forth
therein; or (C) including in the Prospectus included in the Registration Statement any material
information with respect to the plan of distribution not disclosed in the Registration Statement or
any material change to such information. Upon the occurrence of any such suspension, the Company
shall use its commercially reasonable efforts to cause the Registration Statement to become
effective or to promptly amend or supplement the Registration Statement on a post-effective basis
or to take such action as is necessary to permit resumed use of the Registration Statement as soon
as possible.




          (d) In the case of an event that causes the Company to suspend the use of a Registration
Statement (a “Suspension Event”), the Company shall give written notice (a “Suspension
Notice”) to the Holders to suspend sales of the Registrable
Securities and such notice shall state generally the basis for the notice and certify, by an
officer of the Company, that such suspension shall continue only for so long as the Suspension
Event or its effect is continuing and the Company is taking all reasonable steps to terminate
suspension of the use of the Registration Statement as promptly as possible. The Holders shall not
effect any sales of the Registrable Securities pursuant to

-15-









 








such Registration Statement (or such
filings) at any time after receiving a Suspension Notice from the Company and prior to receipt of
an End of Suspension Notice (as defined below). If so directed by the Company, each Holder will
deliver to the Company (at the expense of the Company) all copies other than permanent file copies
then in such Holder’s possession of the Prospectus covering the Registrable Securities at the time
of receipt of the Suspension Notice. The Holders may recommence effecting sales of the Registrable
Securities pursuant to the Registration Statement (or such filings) following further notice to
such effect (an “End of Suspension Notice”) from the Company, which End of Suspension
Notice shall be given by the Company to the Holders in the manner described above promptly
following the conclusion of any Suspension Event and its effect.




          (e) Notwithstanding any provision herein to the contrary, if the Company shall give a
Suspension Notice pursuant to this Section 6 with respect to any Registration Statement,
the Company agrees that it shall extend the period of time during which such Registration Statement
shall be maintained effective pursuant to this Agreement by the number of days during the period
from the date of the giving of a Suspension Notice to and including the date when Holders shall
have received an End of Suspension Notice and copies of the supplemented or amended Prospectus
necessary to resume sales, with respect to each Suspension Event; provided such period of time
shall not be extended beyond the date that Underlying Shares are not Registrable Securities.




     6. Indemnification. The Company agrees to indemnify and hold harmless (i) each Holder,
(ii) each Person, if any, who controls (within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act) any Holder (any of the Persons referred
to in this clause (ii) being hereinafter referred to as a “Controlling Person”), (iii) the
respective officers, directors, partners, members, employees, representatives and agents of any
Holder (including any predecessor holder) or any controlling person (any person referred to in
clause (i), (ii) or (iii) may hereinafter be referred to as an “Indemnified Holder”),
against any losses, claims, damages, liabilities or expenses to which such Indemnified Holder may
become subject under the Securities Act or otherwise, (A) insofar as such losses, claims, damages,
liabilities or expenses (or actions or proceedings in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of any material fact contained in any
Registration Statement or Prospectus, or any amendment or supplement thereto or any related
preliminary prospectus, (B) insofar as such losses, claims, damages, liabilities or expenses (or
actions or proceedings in respect thereof) 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, in the light of the circumstances in which they were made, (C)
to the extent of the aggregate amount paid in settlement of any litigation, or any investigation or
proceeding by any court or governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, or any such alleged untrue statement
or omission, or (D) insofar as such losses, claims, damages, liabilities or expenses arise out of
investigating, preparing or defending against any litigation, or any investigation or proceeding by
any court or governmental agency or body, commenced or threatened, or any claim whatsoever based
upon any such untrue statement or omission, or any such



-16-









 







alleged untrue statement or omission;
provided, however, that the Company will not be liable under this paragraph, to the
extent that (i) any such loss, claim, damage, liability or expense arises out of or is based upon
an untrue statement or alleged untrue statement, or omission or alleged omission made in any such
Registration Statement or Prospectus, or any amendment or supplement thereto or any related
preliminary prospectus in reliance upon and in conformity with written information relating to any
Holder furnished to the Company or any underwriter by or on behalf of such Holder specifically for
use in therein or (ii) any untrue statement contained in or omission from a preliminary Prospectus
if a copy of the Prospectus (as then amended or supplemented, if the Company shall have furnished
to or on behalf of the Holder participating in the distribution relating to the relevant
Registration Statement any amendments or supplements thereto) was not sent or given by or on behalf
of such Holder to the Person asserting any such liabilities who purchased Underlying Shares, if
such Prospectus (or Prospectus as amended or supplemented) is required by law to be sent or given
at or prior to the written confirmation of the sale of such Underlying Shares to such Person and
the untrue statement contained in or omission from such preliminary Prospectus was corrected in the
Prospectus (or the Prospectus as amended or supplemented if the Company shall have furnished any
amendments or supplements thereto). The indemnity provided for herein shall remain in full force
and effect regardless of any investigation made by or on behalf of any such Holder. The Company
shall notify such Indemnified Holder promptly of the institution, threat or assertion of any claim,
proceeding (including any governmental investigation) or litigation in connection with the matters
addressed by this Agreement which involves the Company or such Indemnified Holder.



     The Company agrees to reimburse each Indemnified Holder upon demand for any legal or other
expenses reasonably incurred by such Indemnified Holder in connection with investigating or
defending any such loss, claim, damage or liability, action or proceeding or in responding to a
subpoena or governmental inquiry related to the offering of the Registrable Securities, whether or
not such Indemnified Holder is a party to any action or proceeding. In the event that it is finally
judicially determined that an Indemnified Holder was not entitled to receive payments for legal and
other expenses pursuant to this paragraph, such Indemnified Holder will promptly return all sums
that had been advanced pursuant hereto.



     Each Holder agrees, severally and not jointly, to indemnify and hold harmless the Company, its
directors and officers and each Person who controls the Company (within the meaning of either
Section 15 of the Securities Act or Section 20 of the Exchange Act) to the same extent as the
indemnity provided in the first paragraph of this Section 7 from the Company to each Holder, but
only with reference to such losses, claims, damages, liabilities or expenses which are caused by
any untrue statement or omission or alleged
untrue statement or omission made in reliance upon and in conformity with information relating
to a Holder furnished to the Company or any underwriter in writing by such Holder expressly for use
in any Registration Statement or Prospectus, or any amendment or supplement thereto or any related
preliminary prospectus. The liability of any Holder under this paragraph shall in no event exceed
the net proceeds received by such Holder from sales of Registrable Securities giving rise to such
obligation.



-17-









 





     In case any suit, action, proceeding (including any governmental or regulatory investigation),
claim or demand shall be brought or asserted against any Person in respect of which indemnity may
be sought pursuant to either of the first and third paragraphs of this Section 7, such Person (the
“Indemnified Person”) shall promptly notify the Person or Persons against whom such indemnity may
be sought (each an “Indemnifying Person”) in writing. No indemnification provided for in the first
or third paragraphs of this Section 7 shall be available to any Person who shall have failed to
give notice as provided in this paragraph if the party to whom notice was not given was unaware of
the proceeding to which such notice would have related and was materially prejudiced by the failure
to give such notice, but the failure to give such notice shall not relieve the Indemnifying Person
or Persons from any liability which it or they may have to the Indemnified Person for contribution
or otherwise than on account of the provisions of the first and third paragraphs of this Section 7.
In case any such proceeding shall be brought against any Indemnified Person and it shall notify the
Indemnifying Person of the commencement thereof, the Indemnifying Person shall be entitled to
participate therein and, to the extent that it shall wish, jointly with any other Indemnifying
Person similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to
such Indemnified Person and shall pay as incurred (or within 30 days of presentation) the fees and
disbursements of such counsel related to such proceeding. In any such proceeding, any Indemnified
Person shall have the right to retain its own counsel at its own expense. Notwithstanding the
foregoing, the Indemnifying Person shall pay as incurred (or within 30 days of presentation) the
fees and expenses of the counsel retained by the Indemnified Person in the event (i) the
Indemnifying Person and the Indemnified Person shall have mutually agreed to the retention of such
counsel, (ii) the named parties to any such proceeding (including any impleaded parties) include
both the Indemnifying Person and the Indemnified Person and representation of both parties by the
same counsel would be inappropriate due to actual or potential differing interests between them or
(iii) the Indemnifying Person shall have failed to assume the defense and employ counsel reasonably
acceptable to the Indemnified Person within a reasonable period of time after notice of
commencement of the action. It is understood that the Indemnifying Person shall not, in connection
with any proceeding or related proceedings in the same jurisdiction, be liable for the reasonable
fees and expenses of more than one separate firm for all such Indemnified Persons. Such firm shall
be designated in writing by a majority in Amount of Registrable Securities in the case of parties
indemnified pursuant to the first paragraph of this Section 7 and by the Company in the case of
parties indemnified pursuant to the third paragraph of this Section 7. The Indemnifying Person
shall not be liable for any settlement of any proceeding effected without its written consent but
if settled with such consent or if there be a final judgment for the plaintiff, the Indemnifying
Person agrees to indemnify the Indemnified Person from and against any loss or liability by reason
of such settlement or judgment. In addition, the Indemnifying Person will not,
without the prior written consent of the Indemnified Person, settle or compromise or consent
to the entry of any judgment in any pending or threatened claim, action or proceeding of which
indemnification may be sought hereunder (whether or not any Indemnified Person is an actual or
potential party to such claim, action or proceeding) unless such settlement, compromise or consent
includes an unconditional release of each Indemnified Person from all liability arising out of such
claim, action or proceeding.



-18-









 





     To the extent the indemnification provided for in this Section 7 is unavailable to or
insufficient to hold harmless an Indemnified Person under the first or third paragraph of this
Section 7 in respect of any losses, claims, damages, liabilities or expenses (or actions or
proceedings in respect thereof) referred to therein, except by reason of the exceptions set forth
in the first or third paragraphs of this Section 7 or the failure of the Indemnified Person to give
notice as required in the fourth paragraph of this Section 7, then each Indemnifying Person shall
contribute to the amount paid or payable by such Indemnified Person as a result of such losses,
claims, damages, liabilities or expenses (or actions or proceedings in respect thereof) in such
proportion as is appropriate to reflect the relative benefits received by the Indemnifying Person
on the one hand and the Indemnified Person on the other hand from the offering of the Warrants
pursuant to the Warrant Agreement and the Registrable Securities pursuant to any Shelf
Registration. If, however, the allocation provided by the immediately preceding sentence is not
permitted by applicable law then each Indemnifying Person shall contribute to such amount paid or
payable by such Indemnified Person in such proportion as is appropriate to reflect not only such
relative benefits but also the relative fault of the Indemnifying Person on the one hand and the
Indemnified Person on the other in connection with the statements or omissions which resulted in
such losses, claims, damages, liabilities or expenses (or actions or proceedings in respect
thereof), as well as any other relevant equitable considerations. The relative benefits received by
the Company on the one hand and any Indemnified Holder on the other shall be deemed to be in the
same proportion as the total net proceeds (before deducting expenses) received by the Company from
the offering and sale of the Company’s 7.375% Convertible Second Lien Notes due 2012 bear to the
total net proceeds received by such Indemnified Holder from sales of Registrable Securities giving
rise to such obligations. The relative fault shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the Company on the one
hand or such Indemnified Holder on the other and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.



     The Company and the Holders agree that it would not be just and equitable if contributions
pursuant to the immediately preceding paragraph of this Section 7 were determined by pro rata
allocation 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 Person as a result of the losses, claims, damages, liabilities or expenses (or actions
or proceedings in respect thereof) referred to in the immediately preceding paragraph shall be
deemed to include any legal or other expenses reasonably incurred by such Indemnified Person in
connection with investigating or defending any such action or claim or enforcing any rights
hereunder.
Notwithstanding the provisions of this paragraph and the immediately preceding paragraph of
this Section 7, (i) in no event shall any Holder be required to contribute any amount in excess of
the amount by which the net proceeds received by such Holder from the offering or sale of the
Registrable Securities pursuant to a Shelf Registration Statement exceeds the amount of damages
which such Holder would have otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission and (ii) no Person guilty of fraudulent
misrepresentation (within the



-19-









 







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.



     Except as otherwise provided in this Section 7, any losses, claims, damages, liabilities or
expenses for which an Indemnified Person is entitled to indemnification or contribution under this
Section 7 shall be paid by the Indemnifying Person to the Indemnified Person as such losses,
claims, damages, liabilities or expenses are incurred (or within thirty (30) days of presentation).



     The remedies provided for in this Section 7 are not exclusive and shall not limit any rights
or remedies that may otherwise be available to any indemnified party at law or in equity.



     The indemnity and contribution agreements contained in this Section 7 shall remain operative
and in full force and effect regardless of (i) any termination of this Agreement, (ii) any
investigation made by or on behalf of any Holder or any Person controlling any Holder or by or on
behalf of the Company, its officers or directors or any other Person controlling any of the Company
and (iii) acceptance of and payment for any of the Registrable Securities.



     7. Rules 144 and 144A. With a view to making available to the Holders the benefits of Rule
144 and Rule 144A, for so long as any Registrable Securities remain outstanding and regardless of
whether or not the Company has a class of securities registered under the Exchange Act, the Company
shall: (1) keep adequate current public information available (as required by Rule 144); (2) file
with the Commission in a timely manner all reports and other documents required of the Company
under the Securities Act and the Exchange Act; (3) furnish to each Holder promptly upon request,
(A) a written statement by the Company, if true, that it has complied with the applicable reporting
requirements of Rules 144 and 144A, the Securities Act and the Exchange Act, (B) a copy of the most
recent annual or quarterly report of the Company and copies of such other reports and documents so
filed by the Company, (C) the information required by Rule 144A(d)(4) (or any successor rule) under
the Securities Act, and (D) such other information as may be reasonably requested to permit the
Holders to sell such Registrable Securities pursuant to Rule 144 (without regard to Rule 144(k))
and Rule 144A, in each case, without registration. Notwithstanding the foregoing, the provisions of
clauses (1) and (2) shall not apply with respect to the filing by the Company of its (i) Form 10-Q
for the first fiscal quarter of 2005 until June 14, 2005 and (ii) Form 10-K for the 2004 fiscal
year until April 30, 2005.



     8. Underwritten Registrations. If any of the Registrable 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 manage the offering will be selected by, and the
underwriting arrangements with respect thereto will be approved by the majority in Amount of
Registrable Securities to be included in such offering in consultation with the Company;
provided, that no managing investment banker or underwriter shall be chosen to which the
Company shall reasonably object.



-20-









 





     No Holder of Registrable Securities may participate in any underwritten registration hereunder
unless such Holder (a) agrees to sell such Holder’s Registrable Securities on the basis provided in
any underwriting arrangements approved by the Persons entitled hereunder to approve such
arrangements and (b) completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents reasonably required under the terms of such
underwriting arrangements.



     9. Miscellaneous



          (a) No Inconsistent Agreements. The Company has not, as of the date hereof, and the
Company shall not, after the date of this Agreement, enter into any agreement with respect to any
of its securities that is inconsistent with the rights granted to the Holders of Registrable
Securities in this Agreement or otherwise conflicts with the provisions hereof.




          (b) Adjustments Affecting Registrable Securities. The Company shall not, directly or
indirectly, take any action with respect to the Registrable Securities as a class that would
materially and adversely affect the ability of the Holders of Registrable Securities to include
such Registrable Securities in a registration undertaken pursuant to this Agreement.




          (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, otherwise than with the prior written consent of the Company and the Holders of not less
than the majority in Amount of Registrable Securities then outstanding; provided,
however, that Section 7 and this Section 10(c) may not be amended, modified
or supplemented without the prior written consent of the Company and each Holder (including, in the
case of an amendment, modification or supplement of Section 7, any Person who was a Holder
of Registrable Securities disposed of pursuant to any Registration Statement). Notwithstanding the
foregoing, a waiver or consent to depart from the provisions hereof with respect to a matter that
relates exclusively to the rights of Holders of Registrable Securities whose securities are being
sold pursuant to a Registration Statement and that does not directly or indirectly affect, impair,
limit or compromise the rights of other Holders of Registrable Securities may be
given by Holders of at least a majority in principal amount of the Registrable Securities
being sold by such Holders pursuant to such Registration Statement.




          (d) Notices. All notices and other communications (including without limitation any
notices or other communications to the Warrant Agent) provided for or permitted hereunder shall be
made in writing by hand-delivery, registered first-class mail, next-day air courier or facsimile:





	 	(1)	 	if to a Holder, at the most current address
of such Holder set forth on the records of the registrar under the
Warrant Agreement, in the case of Holders of Warrants, and the stock
ledger of the Company, in the case of Holders of common stock of the
Company, unless, in either such case,




-21-









 






	 	 	 	any Holder shall have provided
notice information in a Notice and Questionnaire or any amendment
thereto, in which case such information shall control.
	 
	 	(2)	 	if to the Company:
	 
	 	 	 	RCN Corporation

196 Van Buren Street

Herndon, VA 20170

Facsimile No.: (703) 434-8461

Attention: Benjamin Preston, General Counsel
	 
	 	 	 	with copies to (which shall not constitute notice):
	 
	 	 	 	Milbank, Tweed, Hadley & McCloy LLP

1 Chase Manhattan Plaza

New York, NY 10005

Facsimile: (212) 822-5899

Attention: Thomas Janson





     All such notices and communications shall be deemed to have been duly given: when delivered by
hand, if personally delivered; five (5) Business Days after being deposited in the mail, postage
prepaid, if mailed; one Business Day after being timely delivered to a next-day air courier; and
when the addressor receives facsimile confirmation, if sent by facsimile during normal business
hours, and otherwise on the next Business Day during normal business hours.



          (e) Successors and Assigns. This Agreement shall inure to the benefit of and be
binding upon the successors and assigns of each of the parties hereto, including, without
limitation, the Holders and without the need for an express assignment, subsequent Holders. If any
transferee of any Holder shall acquire the Registrable Securities, in any manner, whether by
operation of law or otherwise, such Registrable Securities shall be held subject to all of the
terms of this Agreement, and by taking and holding such Registrable 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 and
such Person shall be entitled to receive the benefits hereof.




          (f) 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.




          (g) Headings. The headings in this Agreement are for convenience of reference only and
shall not limit or otherwise affect the meaning hereof.




          (h) Governing Law; Jurisdiction; Waiver of Jury Trial. All questions concerning the
construction, validity, enforcement and interpretation of this Agreement




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shall be governed by the
internal laws of the State of New York, without giving effect to any choice of law or conflict of
law provision or rule (whether of the State of New York or any other jurisdictions) that would
cause the application of the laws of any jurisdictions other than the State of New York. Each party
hereby irrevocably waives personal service of process and consents to process being served in any
such suit, action or proceeding by mailing a copy thereof to such party at the address for such
notices to it under this Agreement and agrees that such service shall constitute good and
sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit
in any way any right to serve process in any manner permitted by law. If any provision of this
Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity or
unenforceability shall not affect the validity or enforceability of the remainder of this Agreement
in that jurisdiction or the validity or enforceability of any provision of this Agreement in any
other jurisdiction.




     EACH OF THE PARTIES HERETO WAIVES ANY RIGHT TO REQUEST A TRIAL BY JURY IN ANY LITIGATION WITH
RESPECT TO THIS AGREEMENT AND REPRESENTS THAT COUNSEL HAS BEEN CONSULTED SPECIFICALLY AS TO THIS
WAIVER.



          (i) Severability. If any term, provision, covenant or restriction of this Agreement is
held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in
full force and effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their best efforts to find and employ an alternative means to achieve the same or
substantially the same result as that contemplated by such term, provision, covenant or
restriction. It is hereby stipulated and declared to be the intention of the parties that they
would have executed the remaining terms, provisions, covenants and restrictions without including
any of such that may be hereafter declared invalid, illegal, void or unenforceable.




          (j) Securities Held by the Company or Its Affiliates. Whenever the consent or approval
of Holders of a specified percentage in Amount of Registrable Securities is required hereunder,
Registrable Securities held by the Company or its affiliates (as such term is defined in Rule 405
under the Securities Act) shall not be
counted in determining whether such consent or approval was given by the Holders of such
required percentage.




          (k) Third-Party Beneficiaries. Holders of Registrable Securities are intended third
party beneficiaries of this Agreement and the Company and each Holder shall have the right to
enforce this Agreement directly to the extent it deems such enforcement necessary or advisable to
protect its rights or the rights of Holders hereunder.




          (l) Entire Agreement. This Agreement, together with the Warrant Agreement, the Warrant
Agreement and the Warrant, is intended by the parties as a final and exclusive statement of the
agreement and understanding of the parties hereto in respect of the subject matter contained herein
and therein and any and all prior oral or

-23-









 








written agreements, representations, or warranties,
contracts, understandings, correspondence, conversations and memoranda between the Holders on the
one hand and the Company on the other, or between or among any agents, representatives, parents,
subsidiaries, affiliates, predecessors in interest or successors in interest with respect to the
subject matter hereof and thereof are merged herein and replaced hereby.




[signature page follows]




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



	 	 	 	 	 	 	 
	 	 	RCN CORPORATION, as an Assignor	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	Title:	 	 	 	 






[Signature Page – Registration Rights Agreement]





 









 








Appendix A




Notice and Questionnaire




A-1









 





FORM OF SELLING SECURITYHOLDER NOTICE AND QUESTIONNAIRE




     The undersigned beneficial holder of the warrants (the “Warrants”) delivered pursuant
to the Warrant Agreement dated as of May 25, 2007, between RCN Corporation, a Delaware corporation
(the “Company”) and HSBC Bank USA, National Association, as Warrant Agent, each of which
such warrant represents, subject to adjustment in accordance with its terms, the right to purchase
one share of common stock of the Company, par value $0.01 per share (the “Common Stock” and
together with the Warrants, “Underlying Shares”) of the Company (the “Registrable
Securities”), understands that the Company has filed or intends to file with the Securities and
Exchange Commission a registration statement (the “Shelf Registration Statement”) for the
registration and resale of the Registrable Securities in accordance with the terms of the
Registration Rights Agreement, dated as of May 25, 2007 (the “Registration Rights
Agreement”), by and among the Company and the holders named therein. A copy of the Registration
Rights Agreement is available from the Company upon request at the address set forth below.



     Each beneficial owner of Registrable Securities is entitled to the benefits of the
Registration Rights Agreement. In order to sell or otherwise dispose of any Registrable Securities
pursuant to the Shelf Registration Statement, a beneficial owner of Registrable Securities
generally will be required to be named as a selling securityholder in the related prospectus,
deliver a prospectus to each purchaser of Registrable Securities and be bound by those provisions
of the Registration Rights Agreement applicable to such beneficial owner (including certain
indemnification provisions, as described below). Beneficial owners are encouraged to complete and
deliver this Selling Securityholder Notice and Questionnaire prior to the effectiveness of the
Shelf Registration Statement so that such beneficial owners may be named as selling securityholders
in the related prospectus at the time of effectiveness. Any beneficial owner of Warrants wishing to
include its Registrable Securities must deliver to the Company a properly completed and signed
Selling Securityholder Notice and Questionnaire.



     Certain legal consequences arise from being named as a selling securityholder in the Shelf
Registration Statement and the related prospectus. Accordingly, holders and beneficial owners of
Registrable Securities are advised to consult their own securities law counsel regarding the
consequences of being named or not being named as a selling securityholder in the Shelf
Registration Statement and the related prospectus.



Notice




     The undersigned beneficial owner (the “Selling Securityholder”) of Registrable
Securities hereby gives notice to the Company of its intention to sell or otherwise dispose of
Registrable Securities beneficially owned by it and listed below in Item 3 (unless otherwise
specified under Item 3) pursuant to the Shelf Registration Statement. The undersigned, by signing
and returning this Selling Securityholder Notice and Questionnaire, understands that it will be
bound by the terms and conditions of this Selling Securityholder Notice and Questionnaire and the
Registration Rights Agreement.



     The undersigned hereby provides the following information to the Company and represents and
warrants that such information is accurate and complete as of the date below:



 









 




Questionnaire





	1.	 	(a) Full Legal Name of Selling Securityholder:





     (b) Full Legal Name of Registered Holder (if not the same as (a) above) through which
Registrable Securities listed in (3) below are held:



     (c) Full Legal Name of DTC Participant (if applicable and if not the same as (b) above)
through which Registrable Securities listed in (3) below are held:




	2.	 	Address for Notices to Selling Securityholder:
	 
	 	 	Telephone:
	 
	 	 	Fax:
	 
	 	 	Contact Person:
	 
	3.	 	Beneficial Ownership of Registrable Securities:
	 
	 	 	(a)   Type and Principal Amount of Registrable Securities beneficially owned:
	 
	 	 	(b)   CUSIP No(s). of Registrable Securities beneficially owned:
	 
	4.	 	If other than a natural person, please indicate the form or organization of the Selling
Securityholder (e.g. corporation, limited liability company, limited partnership, general
partnership, trust, estate, etc.):
	 
	5.	 	If the Selling Securityholder is not a natural person, and is not a publicly traded entity,
please identify the individuals who beneficially own the shares or interests of the Selling
Securityholder (including any intermediate entities through which such beneficial ownership is
held) and the amounts and percentages of such ownership:
	 
	6.	 	Please indicate whether the Selling Securityholder is a “broker” or a “dealer” (as such terms
are defined in Section 3 of the Securities Exchange Act of 1934, as amended) or an affiliate
of any broker or dealer.
	 
	7.	 	If the Selling Securityholder is an affiliate of any broker or dealer, please indicate by
checking the appropriate box whether the answer to the following questions is “True” or
“False.”






	 	(a)	 	The Selling Securityholder purchased the Registrable Securities in the
ordinary course of business.





 ̈ True  ̈ False





	 	(b)	 	At the time of the purchase of the Registrable Securities to be resold, the
Selling Securityholder had no agreements or understandings, directly or




 









 






	 	 	 	indirectly, with any person to distribute them.





 ̈ True  ̈ False





	8.	 	Beneficial Ownership of the Company’s securities owned by the Selling Securityholder:
	 
	 	 	Except as set forth below in this Item (4), the undersigned is not the beneficial or
registered owner of any “Other Securities,” defined as securities of the Company other than
the Registrable Securities listed above in Item (3).






	 	(a)	 	Type and Amount of Other Securities beneficially owned by the Selling
Securityholder:
	 
	 	(b)	 	CUSIP No(s). of such Other Securities beneficially owned:






	9.	 	Relationship with the Company:
	 
	 	 	Except as set forth below, neither the undersigned nor any of its affiliates, officers,
directors or principal equityholders (5% or more) has held any position or office or has
had any other material relationship with the Company (or its predecessors or affiliates)
during the past three years.
	 
	 	 	State any exceptions here:
	 
	10.	 	Plan of Distribution:
	 
	 	 	Except as set forth below, the undersigned (including its donees or pledgees) intends to
distribute the Registrable Securities listed above in Item (3) pursuant to the Shelf
Registration Statement only as follows (if at all): Such Registrable Securities may be sold
from time to time directly by the undersigned or alternatively, through underwriters,
broker-dealers or agents (with the prior agreement of the Company). If the Registrable
Securities are sold through underwriters or broker-dealers, the Selling Securityholder will
be responsible for underwriting discounts or commissions or agent’s commissions. Such
Registrable Securities may be sold in one or more transactions at fixed prices, at
prevailing market prices at the time of sale, at varying prices determined at the time of
sale, or at negotiated prices. Such sales may be effected in transactions (which may
involve block transactions) (i) on any national securities exchange or quotation service on
which the Registrable Securities may be listed or quoted at the time of sale, (ii) in the
over-the-counter market, (iii) in transactions otherwise than on such exchanges or services
or in the over-the-counter market, or (iv) through the writing of options. In connection
with sales of the Registrable Securities or otherwise, the undersigned may enter into
hedging transactions with broker-dealers, which may in turn engage in short sales of the
Registrable Securities and deliver Registrable Securities to close out such short
positions, or loan or pledge Registrable Securities to broker-dealers that in turn may sell
such securities.




 









 











     State any exceptions here:



     The undersigned acknowledges that it understands its obligation to comply with the provisions
of the Securities Exchange Act of 1934, as amended, and the rules thereunder relating to stock
manipulation, particularly Regulation M thereunder (or any successor rules or regulations), in
connection with any offering of Registrable Securities pursuant to the Shelf Registration
Statement. The undersigned agrees that neither it nor any person acting on its behalf will engage
in any transaction in violation of such provisions. The Selling Securityholder hereby acknowledges
its obligations under the Registration Rights Agreement to indemnify and hold harmless certain
persons as set forth therein.



     Pursuant to the Registration Rights Agreement, the Company has agreed under certain
circumstances to indemnify the Selling Securityholder against certain liabilities.



     In accordance with the undersigned’s obligation under the Registration Rights Agreement to
provide such information as may be required by law for inclusion in the Shelf Registration
Statement, the undersigned agrees to promptly notify the Company of any inaccuracies or changes in
the information provided herein that may occur subsequent to the date hereof at any time while the
Shelf Registration Statement remains effective. All notices hereunder and pursuant to the
Registration Rights Agreement shall be made in writing at the address set forth below.



     By signing below, the undersigned consents to the disclosure of the information contained
herein in its answers to items (1) through (10) above and the inclusion of such information in the
Shelf Registration Statement and the related prospectus. The undersigned understands that such
information will be relied upon by the Company in connection with the preparation or amendment of
the Shelf Registration Statement and the related prospectus.



     IN WITNESS WHEREOF, the undersigned, by authority duly given, has caused this Selling
Securityholder Notice and Questionnaire to be executed and delivered either in person or by its
duly authorized agent.



	 	 	 	 	 	 	 
	Dated:	 	Beneficial Owner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	Title:	 	 	 	 






PLEASE RETURN THE COMPLETED AND EXECUTED SELLING

SECURITYHOLDER NOTICE AND QUESTIONNAIRE TO:




 









 





RCN Corporation

196 Van Buren Street

Herndon, VA 20170

Facsimile No.: (703) 434-8461

Attention: Benjamin Preston, General Counsel