Document:

Exhibit 4.4

 

LEVEL 3
FINANCING, INC.

 

12.25% Senior Notes
due 2013

 

REGISTRATION
AGREEMENT

 

New York, New
York

March 14, 2006

 

Merrill Lynch,
Pierce, Fenner & Smith

Incorporated

Credit Suisse Securities (USA) LLC

Morgan Stanley & Co. Incorporated

J.P. Morgan Securities Inc.

 

In care of:

 

Merrill Lynch,
Pierce, Fenner & Smith

Incorporated

4 World
Financial Center

North Tower

250 Vesey
Street

New York, New
York 10080

 

Ladies and
Gentlemen:

 

Level 3
Financing, Inc., a Delaware company (the “Issuer”), proposes to issue and
sell to certain purchasers (the “Purchasers”), upon the terms set forth in a
purchase agreement dated March 9, 2006, (the “Purchase Agreement”), $250,000,000
aggregate principal amount of its 12.25% Senior Notes due 2013 (the “Original 2013
Notes”) (such sale, the “Initial Placement”), to be guaranteed on an unsecured
unsubordinated basis by Level 3 Communications, Inc., the direct parent
company of the Issuer (“Parent”). As an inducement to the Purchasers to enter
into the Purchase Agreement and in satisfaction of a condition to your
obligations thereunder, the Issuer and Parent jointly and severally agree with
you, (i) for your benefit and the benefit of the other Purchasers and (ii) for
the benefit of the holders from time to time of the Original 2013 Notes
(including you and the other Purchasers) (each of the foregoing a “Holder” and
together the “Holders”), as follows:

 

1. Definitions. Capitalized terms used
herein without definition shall have their respective meanings set forth in the
Purchase Agreement. As used in this Agreement, the following capitalized
defined terms shall have the following meanings:

 

 

“Affiliate”
of any specified person means any other person which, directly or indirectly,
is in control of, is controlled by, or is under common control with, such
specified person. For purposes of this definition, control of a person means
the power, direct or indirect, to direct or cause the direction of the
management and policies of such person whether by contract or otherwise; and the
terms “controlling” and “controlled” have meanings correlative to the
foregoing.

 

“Commission”
means the Securities and Exchange Commission.

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission promulgated thereunder.

 

“Exchange
Offer Prospectus” means the prospectus included in the Exchange Offer
Registration Statement, as amended or supplemented by any prospectus
supplement, with respect to the terms of the offering of any portion of the New
2013 Notes covered by such Exchange Offer Registration Statement, and all
amendments and supplements thereto and all material incorporated by reference
therein.

 

“Exchange
Offer Registration Period” means the 180-day period following the
consummation of the Registered Exchange Offer, exclusive of any period during
which any stop order shall be in effect suspending the effectiveness of the
Exchange Offer Registration Statement.

 

“Exchange
Offer Registration Statement” means a registration statement of the Issuer
and Parent on an appropriate form under the Securities Act with respect to
the Registered Exchange Offer, all amendments and supplements to such
registration statement, including post-effective amendments, in each case
including the Prospectus contained therein, all exhibits thereto and all
material incorporated by reference therein.

 

“Exchanging
Dealer” means any Holder (which may include the Purchasers) which is a
broker-dealer electing to exchange Original 2013 Notes acquired for its own
account as a result of market-making activities or other trading activities for
New 2013 Notes.

 

“Holder” has the meaning set forth in
the preamble hereto.

 

“Indenture”
means the Indenture relating to the Original 2013 Notes and the New 2013 Notes,
dated as of March 14, 2006, among Parent, the Issuer and The Bank of New York,
as trustee, as the same may be amended from time to time in accordance
with the terms thereof.

 

“Initial
Placement” has the meaning set forth in the preamble hereto.

 

“Managing
Underwriters” means the investment banker or investment bankers and manager
or managers that shall administer an offering of securities under a Shelf
Registration Statement.

 

2

 

“New 2013
Notes” means debt securities of the Issuer identical in all material
respects to the Original 2013 Notes (except that the interest rate step-up
provisions and the transfer restrictions will be modified or eliminated, as
appropriate), to be issued under the Indenture.

 

“Original 2013
Notes” has the meaning set forth in the preamble hereto.

 

“Prospectus”
means the prospectus included in any Registration Statement (including, without
limitation, a prospectus that discloses information previously omitted from a
prospectus filed as part of an effective registration statement in
reliance upon Rule 430A under the Securities Act), as amended or
supplemented by any prospectus supplement, with respect to the terms of the
offering of any portion of the Original 2013 Notes or the New 2013 Notes, covered
by such Registration Statement, and all amendments and supplements to the
Prospectus, including post-effective amendments.

 

“Registered
Exchange Offer” means the proposed offer to the Holders to issue and
deliver to such Holders, in exchange for the Original 2013 Notes, a like
principal amount of the New 2013 Notes.

 

“Registration
Securities” has the meaning set forth in Section 3(a) hereof.

 

“Registration
Statement” means any Exchange Offer Registration Statement or Shelf
Registration Statement that covers any of the Original 2013 Notes or the New 2013
Notes pursuant to the provisions of this Agreement, all amendments and
supplements to such registration statement, including, without limitation,
post-effective amendments, in each case including the Prospectus contained
therein, all exhibits thereto and all material incorporated by reference
therein.

 

“Securities
Act” means the Securities Act of 1933, as amended, and the rules and
regulations of the Commission promulgated thereunder.

 

“Shelf
Registration” means a registration effected pursuant to Section 3
hereof.

 

“Shelf
Registration Period” has the meaning set forth in Section 3(b) hereof.

 

“Shelf
Registration Statement” means a “shelf” registration statement of Parent
and the Issuer pursuant to the provisions of Section 3 hereof which covers
some of or all the Original 2013 Notes or New 2013 Notes, as applicable, on an
appropriate form under Rule 415 under the Securities Act, or any
similar rule that may be adopted by the Commission, all amendments
and supplements to such registration statement, including post-effective
amendments, in each case including the Prospectus contained therein, all
exhibits thereto and all material incorporated by reference therein.

 

“Trustee”
means the trustee with respect to the Original 2013 Notes and the New 2013
Notes under the Indenture.

 

3

 

“2013
Majority Holders” means the Holders of a majority of the aggregate
principal amount of the Original 2013 Notes and the New 2013 Notes registered
under a Registration Statement.

 

“underwriter”
means any underwriter of securities in connection with an offering thereof
under a Shelf Registration Statement.

 

2. Registered Exchange Offer; Resales of New
2013 Notes by Exchanging Dealers; Private Exchange.

 

(a)  The Issuer
and Parent shall prepare and, not later than June 12, 2006, shall file
with the Commission the Exchange Offer Registration Statement with respect to
the Registered Exchange Offer. The Issuer and Parent shall use their commercially
reasonable efforts to cause the Exchange Offer Registration Statement to become
effective under the Securities Act by October 10, 2006.

 

(b)  Upon
the effectiveness of the Exchange Offer Registration Statement, the Issuer and Parent
shall promptly commence the Registered Exchange Offer, it being the objective
of such Registered Exchange Offer to enable each Holder electing to exchange Original
2013 Notes for New 2013 Notes (assuming that such Original 2013 Notes do not
constitute a portion of an unsold allotment acquired by such Holder directly
from the Issuer, such Holder is not an Affiliate of the Issuer or Parent, such
Holder acquires the New 2013 Notes in the ordinary course of its business and such
Holder has no arrangements with any person to participate in the distribution
of the New 2013 Notes) to trade such New 2013 Notes from and after their
receipt without any limitations or restrictions under the Securities Act and
without material restrictions under the securities laws of a substantial proportion
of the several states of the United States.

 

(c)  In
connection with the Registered Exchange Offer, the Issuer and Parent shall:

 

(i) 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;

 

(ii) keep
the Registered Exchange Offer open for not less than 20 business days after the
date notice thereof is mailed to the Holders (or longer if required by
applicable law);

 

(iii) utilize
the services of a depositary for the Registered Exchange Offer with an address
in the Borough of Manhattan, The City of New York; and

 

(iv) comply
in all material respects with all applicable laws.

 

(d)  As
soon as practicable after the close of the Registered Exchange Offer, the Issuer
and Parent shall:

 

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(i) accept
for exchange all Original 2013 Notes tendered and not validly withdrawn
pursuant to the Registered Exchange Offer;

 

(ii) deliver
to the Trustee for cancellation all Original 2013 Notes so accepted for
exchange; and

 

(iii) cause
the Trustee promptly to authenticate and deliver to each Holder of Original 2013
Notes, a principal amount of New 2013 Notes equal to the principal amount of
the Original 2013 Notes of such Holder so accepted for exchange.

 

(e)  The
Purchasers, the Issuer and Parent acknowledge that, pursuant to current
interpretations by the Commission’s staff of Section 5 of the Securities
Act, and in the absence of an applicable exemption therefrom, each Exchanging
Dealer is required to deliver a Prospectus in connection with a sale of any New
2013 Notes received by such Exchanging Dealer pursuant to the Registered
Exchange Offer in exchange for Original 2013 Notes acquired for its own account
as a result of market-making activities or other trading activities. Accordingly,
the Issuer and Parent shall:

 

(i) include
the information set forth in Annex A hereto on the cover of the Exchange
Offer Registration Statement, in Annex B hereto in the forepart of
the Exchange Offer Registration Statement in a section setting forth
details of the Exchange Offer, in Annex C hereto in the underwriting or
plan of distribution section of the Prospectus forming a part of the
Exchange Offer Registration Statement, and in Annex D hereto in the Letter
of Transmittal delivered pursuant to the Registered Exchange Offer (it being
understood that a Holder’s participation in the Exchange Offer is conditioned
on the Holder, by executing and returning the Letter of Transmittal,
representing in writing to the Issuer as set forth in Rider B of
Annex D hereto); and

 

(ii) use commercially
reasonable efforts to keep the Exchange Offer Registration Statement
continuously effective under the Securities Act during the Exchange Offer
Registration Period for delivery by Exchanging Dealers in connection with sales
of New 2013 Notes received pursuant to the Registered Exchange Offer, as
contemplated by Section 4(h) below.

 

(f)  In
the event that any Purchaser determines that it is not eligible to participate
in the Registered Exchange Offer with respect to the exchange of Original 2013
Notes constituting any portion of an unsold allotment, at the request of such
Purchaser, the Issuer and Parent shall issue and deliver to such Purchaser or
the party purchasing New 2013 Notes registered under a Shelf Registration
Statement as contemplated by Section 3 hereof from such Purchaser, in
exchange for such Original 2013 Notes, a like principal amount of New 2013
Notes. The Issuer and Parent shall seek to cause the CUSIP Service Bureau to
issue the same CUSIP number for such New 2013 Notes as for New 2013 Notes
issued pursuant to the Registered Exchange Offer.

 

5

 

(g)  Parent
and the Issuer may include in the Exchange Offer Registration Statement up
to $150,000,000 aggregate principal amount of the Issuer’s Floating Rate Senior
Notes due 2011 (the “Original Floating Rate Notes”), guaranteed by Parent, to
be exchanged for debt securities of the Issuer identical in all material
respects to the Original Floating Rate Notes (except that the interest rate
step-up provisions and the transfer restrictions will be modified or
eliminated, as appropriate) (the “New Floating Rate Notes”).

 

3. Shelf Registration. If, (i) because
of any change in law or applicable interpretations thereof by the Commission’s
staff, the Issuer and Parent determine upon advice of outside counsel that they
are not permitted to effect the Registered Exchange Offer as contemplated by Section 2
hereof, or (ii) for any other reason the Exchange Offer Registration
Statement is not declared effective by October 10, 2006 or the Registered
Exchange Offer is not consummated within 30 business days following the initial
effectiveness date of the Exchange Offer Registration Statement, or (iii) any
Purchaser so requests with respect to Original 2013 Notes (or any New 2013
Notes received pursuant to Section 2(f)) not eligible to be exchanged for New
2013 Notes in a Registered Exchange Offer or, in the case of any Purchaser that
participates in any Registered Exchange Offer, such Purchaser does not receive
freely tradable New 2013 Notes, or (iv) any Holder (other than a
Purchaser) is not eligible to participate in the Registered Exchange Offer or (v) in
the case of any such Holder that participates in the Registered Exchange Offer,
such Holder does not receive freely tradable New 2013 Notes in exchange for
tendered securities, other than by reason of such Holder being an affiliate of the
Issuer and Parent within the meaning of the Securities Act (it being understood
that, for purposes of this Section 3, (x) the requirement that a Purchaser
deliver a Prospectus containing the information required by Items 507
and/or 508 of Regulation S-K under the Securities Act in connection with
sales of New 2013 Notes acquired in exchange for such Original 2013 Notes shall
result in such New 2013 Notes being not “freely tradeable” but (y) the
requirement that an Exchanging Dealer deliver a Prospectus in connection with
sales of New 2013 Notes acquired in the Registered Exchange Offer in exchange
for Original 2013 Notes acquired as a result of market-making activities or
other trading activities shall not result in such New 2013 Notes being not “freely
tradeable”), the following provisions shall apply:

 

(a)  The Issuer
and Parent shall as promptly as practicable (but in no event more than the
later of (i) June 12, 2006 or (ii) 45 days after so required or
requested pursuant to this Section 3), file with the Commission and
thereafter shall use their commercially reasonable efforts to cause to become
effective under the Securities Act, or, if permitted by Rule 430B under
the Securities Act, otherwise designate an existing registration statement
filed with the Commission as, a Shelf Registration Statement relating to the
offer and sale of the Original 2013 Notes or the New 2013 Notes, as applicable,
by the Holders from time to time in accordance with the methods of distribution
elected by such Holders and set forth in such Shelf Registration Statement
(such Original 2013 Notes or New 2013 Notes, as applicable, to be sold by such
Holders under such Shelf Registration Statement being referred to herein as “Registration

 

6

 

Securities”); provided, however,
that, with respect to New 2013 Notes received by a Purchaser in exchange for Original
2013 Notes constituting any portion of an unsold allotment, the Issuer and Parent
may, if permitted by current interpretations by the Commission’s staff, file a
post-effective amendment to the Exchange Offer Registration Statement
containing the information required by Regulation S-K Items 507 and/or 508, as
applicable, in satisfaction of their obligations under this paragraph (a) with
respect thereto, and any such Exchange Offer Registration Statement, as so
amended, shall be referred to herein as, and governed by the provisions herein
applicable to, a Shelf Registration Statement. Unless the Shelf Registration
Statement is an automatic shelf registration statement (as defined in Rule 405
under the Securities Act), the Issuer and Parent shall include the information
required by Rule 430B(b)(2)(iii) under the Securities Act.

 

(b)  The Issuer
and Parent shall use their commercially reasonable efforts to keep the Shelf
Registration Statement continuously effective in order to permit the Prospectus
forming part thereof to be usable by Holders for a period of two years
from the date the Shelf Registration Statement becomes effective or is
designated as such or such shorter period that will terminate when all the Original
2013 Notes or New 2013 Notes, as applicable, covered by the Shelf Registration
Statement have been sold pursuant to the Shelf Registration Statement (in any
such case, such period being called the “Shelf Registration Period”). The Issuer
and Parent shall be deemed not to have used their commercially reasonable
efforts to keep the Shelf Registration Statement effective during the Shelf
Registration Period if the Issuer, or Parent voluntarily takes any action that
would result in Holders of securities covered thereby not being able to offer
and sell such securities during that period, unless (i) such action is
required by applicable law or (ii) such action is taken by such party in
good faith and for valid business reasons (not including avoidance of the
obligations of the Issuer and Parent hereunder), including the acquisition or
divestiture of assets, so long as the Issuer and Parent promptly thereafter
comply with the requirements of Section 4(k) hereof, if applicable.

 

(c)  Parent
and the Issuer may include in the Shelf Registration Statement up to
$150,000,000 aggregate principal amount of the Original Floating Rate Notes or
the New Floating Rate Notes, as applicable, to be offered and sold by the
holders thereof from time to time in accordance with the methods of
distribution elected by such holders and set forth in such Shelf Registration
Statement.

 

4. Registration Procedures. In
connection with any Shelf Registration Statement and, to the extent applicable,
any Exchange Offer Registration Statement, the following provisions shall
apply:

 

(a)  (i)  The Issuer and Parent
shall furnish to you, prior to the filing or designation thereof with the
Commission, a copy of any Exchange Offer Registration Statement, each amendment
thereof and each amendment or supplement, if any, to the Prospectus included
therein and shall use its commercially reasonable efforts to reflect in each
such document, when so filed

 

7

 

or designated with the Commission, such comments as you reasonably may propose.

 

(ii) The Issuer and Parent shall furnish
to you, prior to the filing or designation thereof with the Commission, a copy
of any Shelf Registration Statement, each amendment thereof and each amendment
or supplement, if any, to the Prospectus included therein and shall use its
commercially reasonable efforts to reflect in each such document, when so filed
or designated with the Commission, such comments as any Holder whose securities
are to be included in such Shelf Registration Statement reasonably may propose.

 

(b)  The Issuer and Parent shall ensure
that (i) any Registration Statement and any amendment thereto and any
Prospectus forming part thereof and any amendment or supplement thereto
complies in all material respects with the Securities Act and the rules and
regulations thereunder, (ii) any Registration Statement and any amendment
thereto does not, when it becomes effective (or, in the case of a previously filed
registration statement that is effective at the time it is designated as a
Shelf Registration Statement, when it is so designated), 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 Registration Statement,
and any amendment or supplement to such Prospectus, does not include an untrue
statement of a material fact or omit to state a material fact necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading.

 

(c)  (1) The Issuer and Parent shall
advise you and, in the case of a Shelf Registration Statement, the Holders of
securities covered thereby, and, if requested by you or any such Holder,
confirm such advice in writing:

 

(i) when
a Registration Statement and any amendment thereto has been filed (or, in the
case of a previously
filed registration statement designated as a Shelf Registration Statement, when
it is so designated) with the Commission and when the Registration
Statement or any post-effective amendment thereto has become effective (or, in
the case of a previously
filed registration statement that is effective at the time it is designated as
a Shelf Registration Statement, when it is so designated); and

 

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

 

(2)  The Issuer
and Parent shall advise you and, in the case of a Shelf Registration Statement,
the Holders of securities covered thereby, and, in the case of an Exchange
Offer Registration Statement, any Exchanging Dealer which has

 

8

 

provided in
writing to the Issuer a telephone or facsimile number and address for notices,
and, if requested by you or any such Holder or Exchanging Dealer, confirm such
advice in writing:

 

(i) 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;

 

(ii) of
the receipt by the Issuer or Parent of any notification with respect to the
suspension of the qualification of the securities included therein for sale in
any jurisdiction or the initiation or threatening of any proceeding for such
purpose; and

 

(iii) of
the happening of any event that requires the making of any changes in the
Registration Statement or the Prospectus so that, as of such date, the
statements therein are not misleading and do not 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 the light of the circumstances under which they
were made) not misleading (which advice shall be accompanied by an instruction
to suspend the use of the Prospectus until the requisite changes have been
made).

 

Each such
Holder or Exchanging Dealer agrees by its acquisition of such securities to be
sold by such Holder or Exchanging Dealer, that, upon being so advised by the Issuer
or Parent of any event described in clause (iii) of this
paragraph (c)(2), such Holder or Exchanging Dealer will forthwith
discontinue disposition of such securities under such Registration Statement or
Prospectus, until such Holder’s or Exchanging Dealer’s receipt of the copies of
the supplemented or amended Prospectus contemplated by paragraph 4(k)
hereof, or until it is advised in writing by the Issuer or Parent that the use
of the applicable Prospectus may be resumed.

 

(d)  The Issuer and Parent shall use their
commercially reasonable efforts to obtain the withdrawal of any order
suspending the effectiveness of any Registration Statement at the earliest
possible time.

 

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

 

(f)  The Issuer and Parent shall, during
the Shelf Registration Period, deliver to each Holder of securities included
within the coverage of any Shelf Registration Statement, without charge, as
many copies of the Prospectus

 

9

 

(including each preliminary Prospectus) included in such Shelf
Registration Statement and any amendment or supplement thereto as such Holder may reasonably
request; and each of the Issuer and Parent hereby consent to the use of the
Prospectus or any amendment or supplement thereto by each of the selling
Holders of securities in connection with the offering and sale of the
securities covered by the Prospectus or any amendment or supplement thereto.

 

(g)  The Issuer and Parent shall furnish
to each Exchanging Dealer which 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 the Exchanging
Dealer so requests in writing, any documents incorporated by reference therein
and all exhibits thereto (including those incorporated by reference therein).

 

(h)  The Issuer and Parent shall, during
the Exchange Offer Registration Period, promptly deliver to each Exchanging
Dealer, without charge, as many copies of the Prospectus included in such
Exchange Offer Registration Statement and any amendment or supplement thereto
as such Exchanging Dealer may reasonably request for delivery by such
Exchanging Dealer in connection with a sale of New 2013 Notes received by it
pursuant to the Registered Exchange Offer; and the Issuer and Parent hereby consent
to the use of the Prospectus or any amendment or supplement thereto by any such
Exchanging Dealer, as aforesaid.

 

(i)  Prior to the Registered Exchange
Offer or any other offering of securities pursuant to any Registration
Statement, the Issuer shall register or qualify or cooperate with the Holders
of securities included therein and their respective counsel in connection with
the registration or qualification of such securities for offer and sale under
the securities or blue sky laws of such jurisdictions as any such Holder
reasonably requests in writing and do any and all other acts or things
necessary or advisable to enable the offer and sale in such jurisdictions of
the securities covered by such Registration Statement; provided, however,
that the Issuer will not be required to qualify generally to do business in any
jurisdiction where it is not then so qualified or to take any action which
would subject it to general service of process or to taxation in any such
jurisdiction where it is not then so subject.

 

(j)  The
Issuer and Parent shall cooperate with the Holders of Original 2013 Notes to
facilitate the timely preparation and delivery of certificates representing Original
2013 Notes to be sold pursuant to any Registration Statement free of any
restrictive legends and in such denominations and registered in such names as
Holders may request prior to sales of securities pursuant to such
Registration Statement.

 

(k)  Upon
the occurrence of any event contemplated by paragraph (c)(2)(iii) above,
the Issuer and Parent shall promptly prepare a post-effective amendment to any
Registration Statement or an amendment or

 

10

 

supplement to the related Prospectus or file any other required
document so that, as thereafter delivered to purchasers of the securities
included therein, the Prospectus will not include an untrue statement of a
material fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.

 

(l)  Not
later than the effective date (or the designation date, in
the case of a previously filed registration statement that is effective at the
time it is designated as a Shelf Registration Statement) of any such
Registration Statement hereunder, the Issuer and Parent shall provide a CUSIP
number for each of the Original 2013 Notes or the New 2013 Notes, as the case may be,
registered under such Registration Statement, and provide the Trustee with
printed certificates for such Original 2013 Notes or New 2013 Notes, in a form,
if requested by the applicable Holder or Holder’s counsel, eligible for deposit
with The Depository Trust Company or any successor thereto under the Indenture.

 

(m)  The
Issuer and Parent shall use their commercially reasonable efforts to comply
with all applicable 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 the security holders of
the Issuer a consolidated earnings statement (which need not be audited)
covering a twelve-month period commencing after the effective date (or the
designation date, in the case of a previously filed registration statement that
is effective at the time it is designated as a Shelf Registration Statement) of
the Registration Statement and ending not later than 15 months thereafter,
as soon as practicable after the end of such period, which consolidated
earnings statement shall satisfy the provisions of Section 11(a) of
the Securities Act.

 

(n)  The
Issuer and Parent shall cause the Indenture to be qualified under the Trust
Indenture Act of 1939, as amended, on or prior to the effective date (or the
designation date, in the case of a previously filed registration statement that
is effective at the time it is designated as a Shelf Registration Statement) of
any Shelf Registration Statement or Exchange Offer Registration Statement.

 

(o)  The
Issuer and Parent may require each Holder of securities to be sold
pursuant to any Shelf Registration Statement to furnish to the Issuer in
writing such information regarding the Holder and the distribution of such
securities as the Issuer may from time to time reasonably require for
inclusion in such Registration Statement. The Issuer may exclude from any
such Registration Statement the securities of any such Holder who fails to
furnish such information within a reasonable time after receiving such request.
Each Holder as to which any Shelf Registration is being effected agrees to
furnish promptly to the Issuer all information required to be disclosed in
order to make the information previously furnished to the Issuer by such Holder
not materially misleading. Each Holder further agrees that, neither such Holder
nor any underwriter participating

 

11

 

in any disposition pursuant to any Shelf Registration Statement on such
Holder’s behalf, will make any offer relating to the securities to be sold
pursuant to such Shelf Registration Statement that would constitute an issuer
free writing prospectus (as defined in Rule 433 under the Securities Act)
or that would otherwise constitute a “free writing prospectus” (as defined in Rule 405
under the Securities Act) required to be filed by the Issuer and Parent with
the Commission or retained by the Issuer and Parent under Rule 433 of the
Securities Act, unless it has obtained the prior written consent of the Issuer
and Parent (and except for as otherwise provided in any underwriting agreement
entered into by the Issuer and Parent and any such underwriter).

 

(p)  The
Issuer and Parent shall, if requested, promptly incorporate in a Prospectus
supplement or post-effective amendment to a Shelf Registration Statement, such
information as the Managing Underwriters, if any, and the 2013 Majority Holders
reasonably agree should be included therein and shall make all required filings
of such Prospectus supplement or post-effective amendment as soon as notified
of the matters to be incorporated in such Prospectus supplement or
post-effective amendment.

 

(q)  (i)  In
the case of any Shelf Registration Statement, the Issuer and Parent shall enter
into such agreements (including underwriting agreements) and take all other
appropriate actions in order to expedite or facilitate the registration or the
disposition of the Original 2013 Notes, and in connection therewith, if an
underwriting agreement is entered into, cause the same to contain
indemnification provisions and procedures no less favorable than those set
forth in Section 6 hereof (or such other provisions and procedures
acceptable to the 2013 Majority Holders and the Managing Underwriters, if any),
with respect to all parties to be indemnified pursuant to Section 6
hereof.

 

(ii)  Without
limiting in any way paragraph (q)(i), no Holder may participate in
any underwritten registration hereunder unless such Holder (x) agrees to
sell such Holder’s securities to be covered by such registration on the basis
provided in any underwriting arrangements approved by the 2013 Majority Holders
and the Managing Underwriters and (y) completes and executes in a timely
manner all customary questionnaires, powers of attorney, underwriting
agreements and other documents reasonably required by the Issuer or the
Managing Underwriters in connection with such underwriting arrangements.

 

(r)  In
the case of any Shelf Registration Statement, the Issuer and Parent shall (i) make
reasonably available for inspection by the Holders of securities to be
registered thereunder, any underwriter participating in any disposition
pursuant to such Registration Statement, and any attorney, accountant or other
agent retained by the Holders or any such underwriter all relevant financial
and other records, pertinent corporate documents and properties of Parent and
its subsidiaries reasonably requested by such person; (ii) cause the officers,
directors

 

12

 

and employees of the Issuer and Parent to supply all relevant
information reasonably requested by the Holders or any such underwriter,
attorney, accountant or agent in connection with any such Registration
Statement as is customary for due diligence examinations in connection with
primary underwritten offerings; provided, however, that any
information that is nonpublic at the time of delivery of such information shall
be kept confidential by the Holders or any such underwriter, attorney,
accountant or agent, unless such disclosure is made in connection with a court
proceeding or required by law, or such information becomes available to the
public generally or through a third party without an accompanying obligation of
confidentiality; provided further, however, that such Holders or
any such underwriter, attorney, accountant or agent may disclose to any
and all persons, without limitation of any kind, the U.S. tax treatment and
U.S. tax structure of any transaction contemplated therein and all materials of
any kind (including opinions or other tax analyses) that are provided to such
Holders or any such underwriter, attorney, accountant or agent relating to such
U.S. tax treatment and U.S. tax structure, other than any information for which
nondisclosure is reasonably necessary in order to comply with applicable
securities laws; (iii) make such representations and warranties to the
Holders of securities registered thereunder and the underwriters, if any, in
form, substance and scope as are customarily made by an issuer to underwriters
in primary underwritten offerings; (iv) obtain opinions of counsel to the Issuer
and Parent (which counsel and opinions (in form, scope and substance) shall be
reasonably satisfactory to the Managing Underwriters, if any) addressed to each
selling Holder and the underwriters, if any, covering such matters as are
customarily covered in opinions requested in underwritten offerings and such
other matters as may be reasonably requested by such Holders and
underwriters; (v) obtain “cold comfort” letters (or, in the case of any
person that does not satisfy the conditions for receipt of a “cold comfort”
letter specified in Statement on Auditing Standards No. 72, an “agreed-upon
procedures” letter under Statement on Auditing Standards No. 35) and
updates thereof from the independent certified public accountants of Parent (and,
if necessary, any other independent certified public accountants of any
subsidiary of Parent or of any business acquired by Parent 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
selling Holder of securities registered thereunder and the underwriters, if
any, in customary form and covering matters of the type customarily
covered in “cold comfort” letters in connection with primary underwritten
offerings; and (vi) deliver such documents and certificates as may be
reasonably requested by the 2013 Majority Holders and the Managing
Underwriters, if any, including those to evidence compliance with Section 4(k)
and with any customary conditions contained in the underwriting agreement or
other agreement entered into by the Issuer and Parent. The foregoing actions
set forth in clauses (iii), (iv), (v) and (vi) of this Section 4(r)
shall be performed (A) on the effective date (or the
designation date, in the case of a previously filed registration statement that
is effective at the time it is designated as a Shelf Registration Statement)
of such Registration Statement and

 

13

 

each post-effective amendment thereto and (B) at each closing
under any underwriting or similar agreement as and to the extent required
thereunder.

 

(s)  In
the case of any Exchange Offer Registration Statement, the Issuer and Parent shall
(i) make reasonably available for inspection by each Purchaser, and any
attorney, accountant or other agent retained by such Purchaser, all relevant
financial and other records, pertinent corporate documents and properties of Parent
and its subsidiaries reasonably requested by such person; (ii) cause the
officers, directors and employees of the Issuer and Parent to supply all
relevant information reasonably requested by such Purchaser or any such
attorney, accountant or agent in connection with any such Registration
Statement as is customary for due diligence examinations in connection with
primary underwritten offerings; provided, however, that any
information that is nonpublic at the time of delivery of such information shall
be kept confidential by such Purchaser or any such attorney, accountant or
agent, unless such disclosure is made in connection with a court proceeding or
required by law, or such information becomes available to the public generally
or through a third party without an accompanying obligation of confidentiality;
provided further, however, that such Purchaser or any such
attorney, accountant or agent may disclose to any and all persons, without
limitation of any kind, the U.S. tax treatment and U.S. tax structure of any
transaction contemplated therein and all materials of any kind (including
opinions or other tax analyses) that are provided to such Purchaser or any such
attorney, accountant or agent relating to such U.S. tax treatment and U.S. tax
structure, other than any information for which nondisclosure is reasonably
necessary in order to comply with applicable securities laws; (iii) make
such representations and warranties to such Purchaser, in form, substance and
scope as are customarily made by an issuer to underwriters in primary
underwritten offerings; (iv) obtain opinions of counsel to the Issuer and Parent
(which counsel and opinions (in form, scope and substance) shall be reasonably
satisfactory to such Purchaser and its counsel), addressed to such Purchaser,
covering such matters as are customarily covered in opinions requested in
underwritten offerings and such other matters as may be reasonably
requested by such Purchaser or its counsel; (v) obtain “cold comfort”
letters and updates thereof from the independent certified public accountants
of Parent (and, if necessary, any other independent certified public
accountants of any subsidiary of Parent or of any business acquired by Parent for
which financial statements and financial data are, or are required to be,
included or incorporated by reference in the Registration Statement), addressed
to such Purchaser, in customary form and covering matters of the type
customarily covered in “cold comfort” letters in connection with primary
underwritten offerings, or if requested by such Purchaser or its counsel in
lieu of a “cold comfort” letter, an agreed-upon procedures letter under
Statement on Auditing Standards No. 35, covering matters requested by such
Purchaser or its counsel; and (vi) deliver such documents and certificates
as may be reasonably requested by such Purchaser or its counsel, including
those to evidence compliance with Section 4(k) and with conditions
customarily contained

 

14

 

in underwriting agreements. The foregoing actions set forth in clauses
(iii), (iv), (v) and (vi) of this Section 4(s) shall be
performed (A) at the close of the Registered Exchange Offer and (B) on
the effective date of any post-effective amendment to the Exchange Offer
Registration Statement.

 

5. Registration Expenses. The Issuer
and Parent shall jointly and severally bear all expenses incurred in connection
with the performance of their obligations under Sections 2, 3 and 4 hereof
and, in the event of any Shelf Registration Statement, will reimburse the Holders
for the reasonable fees and disbursements of one firm or counsel (in addition
to one local counsel in each relevant jurisdiction) designated by the 2013
Majority Holders to act as counsel for the Holders in connection therewith. Notwithstanding
the foregoing, the Holders of the securities being registered shall pay all
agency or brokerage fees and commissions and underwriting discounts and
commissions attributable to the sale of such securities and the fees and
disbursements of any counsel or other advisors or experts retained by such Holders
(severally or jointly), other than the counsel and experts specifically
referred to above in this Section 5, transfer taxes on resale of any of
the securities by such Holders and any advertising expenses incurred by or on
behalf of such Holders in connection with any offers they may make.

 

6. Indemnification and Contribution. (a) 
In connection with any Registration Statement, the Issuer and Parent jointly
and severally agree to indemnify and hold harmless each Holder of securities
covered thereby (including each Purchaser and, with respect to any Prospectus
delivery as contemplated in Section 4(h) hereof, each Exchanging
Dealer), the directors, officers, employees and agents of each such Holder and
each other person, if any, who controls any such Holder within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act against any and
all losses, claims, damages or liabilities, joint or several, to which they or
any of them may become subject under the Securities Act, the Exchange Act
or other Federal or state statutory law or regulation, at common law or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon any untrue statement or
alleged untrue statement of a material fact contained in the Registration
Statement as originally filed or in any amendment thereof, or in any
preliminary Prospectus or Prospectus, or in any amendment thereof or supplement
thereto, or in any issuer free writing prospectus approved for use by the
Issuer and Parent, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and agrees to
reimburse each such indemnified party, as incurred, for any legal or other
expenses reasonably incurred by them in connection with investigating or
defending any such loss, claim, damage, liability or action; provided, however,
that the Issuer and Parent will not be liable in any case to the extent that
any such loss, claim, damage or liability arises out of or is based upon any
such untrue statement or alleged untrue statement or omission or alleged
omission made therein in reliance upon and in conformity with written
information furnished to the Issuer or Parent by or on behalf of any such
Holder specifically for inclusion therein; provided

 

15

 

further, however, that the indemnity
agreement contained in this Section 6(a) shall not inure to the
benefit of any indemnified party to the extent that it is determined by a
final, non-appealable judgment that (i) a preliminary Prospectus contained
an untrue statement of a material fact or omitted to state therein a material
fact required to be stated therein or necessary to make the statements therein
not misleading, (ii) the sale to the person asserting any such losses,
claims, damages or liabilities was an initial resale of securities by any
Holder, (iii) any such loss, claim, damage or liability of such
indemnified party 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 any revised preliminary Prospectus, the related
Prospectus or the related Prospectus as amended or supplemented in any case
where such delivery is required by the Securities Act, and the Issuer and Parent
had previously furnished copies thereof to such Holder and (iv) the
revised preliminary Prospectus, the related Prospectus or the related
Prospectus as amended or supplemented corrected such untrue statement or
omission. This indemnity agreement will be in addition to any liability which
the Issuer and Parent may otherwise have.

 

The Issuer and
Parent also jointly and severally agree to indemnify or contribute to Losses
(as defined below) of, as provided in Section 6(d), any underwriters of Original
2013 Notes or New 2013 Notes registered under a Shelf Registration Statement,
their officers, directors, employees and agents and each person who controls
such underwriters on substantially the same basis as that of the
indemnification of the Purchasers and the selling Holders provided in this Section 6(a) and
shall, if requested by any Holder, enter into an underwriting agreement
reflecting such agreement, as provided in Section 4(q) hereof.

 

(b)  Each
Holder of securities covered by a Registration Statement (including each Purchaser
and, with respect to any Prospectus delivery as contemplated in Section 4(h) hereof,
each Exchanging Dealer) severally and not jointly agrees to indemnify and hold
harmless the Issuer, Parent, each of their directors and officers and each
other person, if any, who controls the Issuer or Parent within the meaning of Section 15
of the Securities Act or Section 20 of the Exchange Act to the same extent
as the foregoing indemnity from the Issuer and Parent to each such Holder, but
only with reference to written information relating to such Holder furnished to
the Issuer by or on behalf of such Holder specifically for inclusion in the
documents referred to in the foregoing indemnity. This indemnity agreement will
be in addition to any liability which any such Holder may otherwise have.

 

(c)  Promptly
after receipt by an indemnified party under this Section 6 of notice of
the commencement of any action, such indemnified party will, if a claim in
respect thereof is to be made against the indemnifying party under this Section 6,
notify the indemnifying party in writing of the commencement thereof; but the
failure so to notify the indemnifying party (i) will not relieve it from
liability under paragraph (a) or (b) above unless and to the
extent it did not otherwise learn of such action and such failure results in
the forfeiture by the indemnifying party of substantial rights and

 

16

 

defenses and (ii) will
not, in any event, relieve the indemnifying party from any obligations to any
indemnified party other than the indemnification obligation provided in
paragraph (a) or (b) above. The indemnifying party shall be
entitled to appoint counsel of the indemnifying party’s choice at the
indemnifying party’s expense to represent the indemnified party in any action
for which indemnification is sought (in which case the indemnifying party shall
not thereafter be responsible for the fees and expenses of any separate counsel
retained by the indemnified party or parties except as set forth below); provided,
however, that such counsel shall be reasonably satisfactory to the
indemnified party. Notwithstanding the indemnifying party’s election to appoint
counsel to represent the indemnified party in an action, the indemnified party
shall have the right to employ separate counsel (including local counsel), and
the indemnifying party shall bear the reasonable fees, costs and expenses of
such separate counsel (and local counsel) if (i) the use of counsel chosen
by the indemnifying party to represent the indemnified party would present such
counsel with a conflict of interest, (ii) the actual or potential
defendants in, or targets of, any such action include both the indemnified
party and the indemnifying party and the indemnified party shall have
reasonably concluded that there may be legal defenses available to it
and/or other indemnified parties which are different from or additional to
those available to the indemnifying party, (iii) the indemnifying party
shall not have employed counsel reasonably satisfactory to the indemnified
party to represent the indemnified party within a reasonable time after notice
of the institution of such action or (iv) the indemnifying party shall
authorize the indemnified party to employ separate counsel at the expense of
the indemnifying party. An indemnifying party will not, without the prior
written consent of the indemnified parties, settle or compromise or consent to
the entry of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification or contribution may be
sought hereunder (whether or not the indemnified parties are actual or
potential parties to such claim or action) unless such settlement, compromise
or consent includes an unconditional release of each indemnified party from all
liability arising out of such claim, action, suit or proceeding. It is
understood, however, that the Issuer and Parent shall, in connection with any
one such action or separate but substantially similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances,
be liable for the reasonable fees and expenses of only one separate firm of
attorneys (in addition to any local counsel) at any time for all such Holders
and controlling persons. An indemnifying party shall not be liable under this Section 6
to any indemnified party regarding any settlement or compromise or consent to
the entry of any judgment with respect to any pending or threatened claim,
action, suit or proceeding in respect of which indemnification or contribution may be
sought hereunder (whether or not the indemnified parties are actual or
potential parties to such claim or action) unless such settlement, compromise
or consent is consented to by such indemnifying party, which consent shall not
be unreasonably withheld.

 

(d)  In
the event that the indemnity provided in paragraph (a) or (b) of
this Section 6 is unavailable to or insufficient to hold harmless an
indemnified party for any reason, then the Issuer, Parent and the Holders, in
lieu of indemnifying such indemnified party, shall have a joint and several
obligation to contribute to the aggregate losses,

 

17

 

claims, damages and liabilities
(including legal or other expenses reasonably incurred in connection with
investigating or defending same) (collectively “Losses”) to which the Issuer, Parent
and the Holders may be subject in such proportion as is appropriate to
reflect the relative benefits received by the Issuer and Parent, on the one
hand, and by the Holders, on the other hand, from the Initial Placement and the
Registration Statement which resulted in such Losses; provided, however,
that in no case shall any Purchaser or any subsequent Holder of any Original 2013
Note or New 2013 Note be responsible, in the aggregate, for any amount in
excess of the purchase discount or commission applicable to such Original 2013
Note, or in the case of a New 2013 Note, applicable to the security which was
exchangeable into such New 2013 Note, as set forth in the Final Memorandum and
in the Purchase Agreement, nor shall any underwriter be responsible for any
amount in excess of the underwriting discount or commission applicable to the
securities purchased by such underwriter under the Registration Statement which
resulted in such Losses. If the allocation provided by the immediately
preceding sentence is unavailable for any reason, the Issuer, Parent and the
Holders severally shall contribute in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Issuer and Parent, on the one hand, and the Holders, on the other hand, in
connection with the statements or omissions which resulted in such Losses as
well as any other relevant equitable considerations. Benefits received by the Issuer
and Parent shall be deemed to be equal to the sum of (x) the total net
proceeds from the Initial Placement (before deducting expenses) as set forth in
the Final Memorandum and in the Purchase Agreement and (y) the total
amount of additional interest which the Issuer was not required to pay as a
result of registering the securities covered by the Registration Statement
which resulted in such Losses. Benefits received by the Purchasers shall be
deemed to be equal to the total purchase discounts and commissions as set forth
in the Final Memorandum and in the Purchase Agreement, and benefits received by
any other Holders shall be deemed to be equal to the value of receiving Original
2013 Notes or New 2013 Notes, as applicable, registered under the Securities
Act. Benefits received by any underwriter shall be deemed to be equal to the
total underwriting discounts and commissions, as set forth on the cover page of
the Prospectus forming a part of the Registration Statement which resulted
in such Losses. Relative fault shall be determined by reference to whether any
alleged untrue statement or omission relates to information provided by the Issuer
and Parent, on the one hand, or by Holders, on the other hand. The parties
agree that it would not be just and equitable if contribution were determined
by pro rata allocation or any other method of allocation which does not take
account of the equitable considerations referred to above. Notwithstanding the provisions
of this paragraph (d), no person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. For purposes of this Section 6, each person who
controls a Holder within the meaning of either the Securities Act or the
Exchange Act and each director, officer, employee and agent of such Holder
shall have the same rights to contribution as such Holder, and each person who
controls the Issuer or Parent within the meaning of either the Securities Act
or the Exchange Act, each of their officers who shall have signed the
Registration Statement and each of their directors shall

 

18

 

have the same rights to
contribution as the Issuer and Parent, subject in each case to the applicable
terms and conditions of this paragraph (d).

 

(e)  The
provisions of this Section 6 will remain in full force and effect,
regardless of any investigation made by or on behalf of any Purchaser, any
other Holder, the Issuer and Parent or any underwriter or any of the officers,
directors or controlling persons referred to in this Section 6, and will
survive the sale by a Holder of securities covered by a Registration Statement.

 

7. Miscellaneous.

 

(a)  No
Inconsistent Agreements. None of the Issuer or Parent has, as of the date
hereof, entered into, nor shall it, on or after the date hereof, enter into,
any agreement with respect to its securities that limits the rights granted to
the Holders herein or otherwise conflicts with the provisions hereof.

 

(b)  Amendments
and Waivers. The provisions of this Agreement, including the provisions of
this sentence, may not be amended, qualified, modified or supplemented,
and waivers or consents to departures from the provisions hereof may not
be given, unless the Issuer has obtained the written consent of the Holders of
at least a majority of the then outstanding aggregate principal amount of Original
2013 Notes (or, after the consummation of any Exchange Offer in accordance with
Section 2 hereof, of New 2013 Notes); provided that, with respect
to any matter that directly or indirectly affects the rights of any Purchaser
hereunder, the Issuer shall obtain the written consent of each such Purchaser
against which such amendment, qualification, supplement, waiver or consent is
to be effective. Notwithstanding the foregoing (except the foregoing proviso),
a waiver or consent to departure from the provisions hereof with respect to a
matter that relates exclusively to the rights of Holders whose securities are
being sold pursuant to a Registration Statement and that does not directly or
indirectly affect the rights of other Holders may be given by the 2013
Majority Holders, determined on the basis of securities being sold rather than
registered under such Registration Statement.

 

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

 

(1) if to
a Holder, at the most current address given by such Holder to the Issuer in
accordance with the provisions of this Section 7(c), which address
initially is, with respect to each Holder, the address of such Holder
maintained by the registrar under the Indenture, with a copy in like manner to Merrill
Lynch, Pierce, Fenner & Smith Incorporated by facsimile (212-449-3207)
and confirmed by mail to it at Merrill Lynch World Headquarters, North Tower,
World Financial Center, New York, New York 10281-1201, Attention: Global
Origination Counsel;

 

19

 

(2) if to
you, initially at the address set forth in the Purchase Agreement; and

 

(3) if to
the Issuer or Parent, initially at the address set forth in the Purchase
Agreement.

 

All such
notices and communications shall be deemed to have been duly given when
received.

 

The Purchasers
or the Issuer by notice to the other may designate additional or different
addresses for subsequent notices or communications.

 

(d)  Successors
and Assigns. This Agreement shall inure to the benefit of and be binding
upon the successors and assigns of each of the parties, including, without the
need for an express assignment or any consent by the Issuer and Parent or
subsequent Holders of Original 2013 Notes and/or New 2013 Notes. The Issuer and
Parent hereby agree to extend the benefits of this Agreement to any Holder of Original
2013 Notes and/or New 2013 Notes and any such Holder may specifically
enforce the provisions of this Agreement as if an original party hereto.

 

(e)  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.

 

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

 

(g)  Governing
Law.  THIS AGREEMENT SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK
(WITHOUT REGARD TO THE CONFLICT OF LAW PROVISIONS THEREOF).

 

(h)  Severability.
In the event that any one or more of the provisions contained herein, or the
application thereof in any circumstances, is held invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions hereof shall not be in any way impaired or affected thereby, it
being intended that all the rights and privileges of the parties shall be
enforceable to the fullest extent permitted by law.

 

(i)  Securities
Held by the Issuer or Parent, etc. Whenever the consent or approval of
Holders of a specified percentage of principal amount of Original 2013 Notes or
New 2013 Notes is required hereunder, Original 2013 Notes or New 2013 Notes, as
applicable, held by the Issuer, Parent or their Affiliates (other than
subsequent Holders of Original 2013 Notes or New 2013 Notes if such subsequent
Holders are deemed to be Affiliates solely by reason of their holdings of such Original
2013 Notes or New 2013

 

20

 

Notes) shall not be counted in
determining whether such consent or approval was given by the Holders of such
required percentage.

 

(j)  Termination. This Agreement shall
automatically terminate, without any further action on the part of the Issuer
and Parent or the Purchasers, upon the termination or cancellation of the
Purchase Agreement prior to the Closing Date.

 

21

 

Please confirm that the foregoing correctly
sets forth the agreement among Parent, the Issuer and you.

 

 

	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  Level 3 Financing, Inc.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/
  Neil J. Eckstein

  	
   

  
	
   

  	
  Name: Neil J. Eckstein

  
	
   

  	
  Title: Senior Vice President

  
	
   

  	
   

  
	
   

  	
  Level 3 Communications, Inc.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/
  Thomas C. Stortz

  	
   

  
	
   

  	
  Name: Thomas C. Stortz

  
	
   

  	
  Title: Executive Vice President

  

 

22

 

The foregoing Agreement is hereby

confirmed and accepted as of the

date first above written.

 

Merrill Lynch,
Pierce, Fenner & Smith Incorporated

Credit Suisse Securities (USA) LLC

Morgan Stanley & Co. Incorporated

J.P. Morgan Securities Inc.

 

By: Merrill
Lynch, Pierce, Fenner & Smith Incorporated

 

 

	
  By:

  	
   /s/ Vikram Kaul

  	
   

  
	
  Name: Vikram
  Kaul

  
	
  Title: Vice
  President

  

 

23

 

ANNEX A

 

Each broker-dealer
that receives New 2013 Notes for its own account pursuant to the Registered
Exchange Offer must acknowledge that it will deliver a prospectus in connection
with any resale of such New 2013 Notes. 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
New 2013 Notes received in exchange for Original 2013 Notes where such New 2013
Notes were acquired by such broker-dealer as a result of market-making
activities or other trading activities. The Issuer and Parent have agreed that,
starting on the date hereof (the “Expiration Date”) and ending on the close of
business on the day that is 180 days following the Expiration Date, it will
make this Prospectus available to any broker-dealer for use in connection with
any such resale. See “Plan of Distribution.”

 

 

ANNEX B

 

Each
broker-dealer that receives New 2013 Notes for its own account in exchange for Original
2013 Notes, where such Original 2013 Notes 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 New 2013 Notes. See “Plan of Distribution.”

 

 

ANNEX C

 

PLAN OF
DISTRIBUTION

 

Each
broker-dealer that receives New 2013 Notes for its own account pursuant to the
Registered Exchange Offer must acknowledge that it will deliver a prospectus in
connection with any resale of such New 2013 Notes. The Prospectus, as it may be
amended or supplemented from time to time, may be used by a broker-dealer
in connection with resales of New 2013 Notes received in exchange for Original 2013
Notes where such Original 2013 Notes were acquired as a result of market-making
activities or other trading activities. Each of the Issuer and Parent has agreed
that, starting on the Expiration Date and ending on the close of business on
the day that is 180 days following the Expiration Date, it will make this
Prospectus, as amended or supplemented, available to any broker-dealer for use
in connection with any such resale. In addition, until           ,
2006, all dealers effecting transactions in the Exchange Securities may be
required to deliver a prospectus.*

 

Neither the Issuer
nor Parent will receive any proceeds from any sale of New 2013 Notes by
broker-dealers. New 2013 Notes 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 New 2013 Notes 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 and/or the purchasers of any such New 2013 Notes. Any
broker-dealer that resells New 2013 Notes that were received by it for its own
account pursuant to the Registered Exchange Offer and any broker or dealer that
participates in a distribution of such New 2013 Notes may be deemed to be
an “underwriter” within the meaning of the Securities Act and any profit of any
such resale of New 2013 Notes and any commissions 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 Issuer and Parent 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 Issuer and Parent have agreed to pay all expenses incident to
the Exchange Offer (other than the expenses of counsel for the Holders of the Original
2013 Notes) other than commissions or concessions of any brokers or

 

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

 

 

dealers and
will indemnify the Holders of the Original 2013 Notes (including any
broker-dealers) against certain liabilities, including liabilities under the
Securities Act.

 

[If applicable, add information required by
Regulation S-K Items 507 and/or 508.]

 

2

 

ANNEX D

 

Rider A

 

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:

  	
   

  	
   

  
	
   

  
	
   

  	
   

  	
   

  

 

Rider B

 

If the
undersigned is not a broker-dealer, the undersigned represents that it acquired
the New 2013 Notes in the ordinary course of its business, it is not engaged
in, and does not intend to engage in, a distribution of New 2013 Notes and it
has no arrangements or understandings with any person to participate in a
distribution of the New 2013 Notes. If the undersigned is a broker-dealer that
will receive New 2013 Notes for its own account in exchange for Original 2013
Notes, it represents that the Original 2013 Notes to be exchanged for New 2013 Notes
were acquired by it as a result of market-making activities or other trading
activities and acknowledges that it will deliver a prospectus in connection
with any resale of such New 2013 Notes; 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.Exhibit 10.7

 

FIRST REGIONAL BANCORP

 

STOCK OPTION AGREEMENT

 

2005 STOCK OPTION PLAN

 

Non-Qualified Stock Option

 

 

THIS
AGREEMENT, dated as of the        day of                     
20    , by and between First Regional Bancorp, a California
corporation (the  “Corporation”), and                          
(“Optionee”);

 

WHEREAS,
pursuant to the Corporation’s 2005 Stock Option Plan (the “Plan”), the Board of
Directors has authorized the grant to Optionee of a Stock Option to purchase
all or any part of                                
(              )
authorized but unissued shares of the Corporation’s no par value Common Stock
at the price of                                    
($             )
per share, such Stock Option to be for the term and upon the terms and
conditions hereinafter stated;

 

NOW,
THEREFORE, it is hereby agreed:

 

1.             Grant of Stock Option. Pursuant
to said action of  the Board of
Directors, the Corporation hereby grants to Optionee the option to purchase,
upon and subject to the terms and conditions of the Plan, which is incorporated
in full herein by this reference, all or any part of                                   
(              )
Option Shares of the Corporation’s Common Stock at the price of                                    
($              )
per share. The Stock Option granted hereunder is not

 

 

intended to qualify as an
Incentive Stock Option within the meaning of Section 422A of the Internal
Revenue Code of 1986, as amended.

 

2.             Exercisability. This Stock
Option shall be  exercisable as to             Option
Shares on                  ,
            ;  as to             
Option Shares on                         ,
,             ; as
to              Option
Shares on                         ,
            ; as to
             Option
Shares on                         ,
            ; as to
             Option
Shares on                         ,
            ; as to
             Option
Shares on                         ,
             and as
to              Option
Shares on                     ,
            . This
Stock Option shall remain exercisable as to all of such Option Shares until                      ,
            , at
which time it shall expire in its 
entirety, unless this Stock Option has expired or terminated  earlier in accordance with the provisions
hereof or of the Plan. Option Shares as to which this Stock Option become
exercisable may be purchased at any time prior to expiration of this Stock
Option.

 

3.             Exercise of Stock Option. This
Stock Option may be exercised by written notice delivered to the Corporation
stating the number of Option Shares with respect to which this Stock Option is
being exercised, together with cash (or bank, cashier’s or certified check)
equal to the full amount of the purchase price of such Option Shares. Not less
than ten (10) Option Shares may be purchased at any one time unless the number
purchased is the total number which remains to be purchased under this Stock
Option and in no event  may the Stock
Option be exercised with respect to fractional shares. Upon exercise, Optionee
shall make appropriate arrangements and shall be responsible for the
withholding of all federal and state income taxes then due, if any.

 

 

4.             Cessation of Affiliation. Except
as provided in  Paragraph 5 hereof, if,
for any reason other than Optionee’s 
disability or death, Optionee ceases to be employed by or  affiliated with the Corporation or a
Subsidiary, this Stock Option shall expire three (3) months thereafter or on the
date specified in Paragraph 2 hereof, whichever is earlier. During such period
after cessation of employment or affiliation, this Stock Option shall be
exercisable only as to those increments, if any, which had become exercisable
as of the date on which the Optionee ceased to be employed by or affiliated
with the Corporation or Subsidiary, and any Stock Options or increments  which had not become exercisable as of such
date shall expire and terminate automatically on such date.

 

5.             Termination for Cause. If
Optionee’s employment  by or affiliation
with the Corporation or a Subsidiary is terminated for cause, this Stock Option
shall automatically expire unless reinstated by the Board of Directors within
thirty (30) days of such termination by giving written notice of such
reinstatement to Optionee. In the event of such reinstatement, Optionee may
exercise this Stock Option only to such extent, for such time, and upon such
terms and conditions as if Optionee had ceased to be employed by or affiliated
with the Corporation or a Subsidiary upon the date of such termination for a
reason other than cause, disability or death. Termination for cause shall
include, but shall not be limited to, termination for malfeasance or gross
misfeasance in the performance of duties or conviction of illegal activity in
connection therewith, or any conduct detrimental to the interests of the
Corporation or a Subsidiary, and, in any 
event, the determination of the Board of Directors with  respect thereto shall be final and
conclusive.

 

3

 

6.             Disability or Death of Optionee.
If Optionee  becomes disabled or dies
while employed by or affiliated with the Corporation or a Subsidiary, or during
the three-month period referred to in Paragraph 4 hereof, this Stock Option
shall automatically expire and terminate one (1) year after the date of
Optionee’s disability or death or on the day specified in Paragraph 2 hereof,
whichever is earlier. After Optionee’s disability or death but before such
expiration, the person or persons to whom Optionee’s rights under this Stock
Option shall have passed by order of a court of competent jurisdiction or by
will or the applicable laws of descent and distribution, or the executor,
administrator or conservator of Optionee’s estate, subject to the provisions of
Paragraph 12 hereof, shall have the right to exercise this Stock Option to the
extent that increments, if any, had become exercisable as of the date on which
Optionee ceased to be employed by or affiliated with the Corporation or a
Subsidiary. For purposes hereof, “disability” shall have the same meaning as
set forth in the Plan.

 

7.             Nontransferability. This
Stock Option shall not  be transferable
except by will or by the laws of descent and 
distribution, and shall be exercisable during Optionee’s lifetime only
by Optionee.

 

8.             Employment. This Agreement
shall not obligate the  Corporation or a
Subsidiary to employ Optionee for any period, nor shall it interfere in any way
with the right of the Corporation or a Subsidiary to increase or reduce
Optionee’s compensation.

 

9.             Privileges of Stock Ownership.
Optionee shall have no rights as a stockholder with respect to the Option
Shares unless and until said Option Shares are issued to Optionee as provided
in the Plan. Except as provided in the Plan, no adjustment will be made for

 

4

 

dividends or other rights in
respect of which the record date is prior to the date such stock certificates
are issued.

 

10.           Modification and Termination by
Board of  Directors. The rights of
Optionee are subject to modification and termination upon the occurrence of
certain events as provided in the Plan. Upon adoption by the requisite holders
of the Corporation’s outstanding shares of Common Stock of any plan of
dissolution, liquidation, reorganization, merger, consolidation or sale of all
or substantially all of the assets of the Corporation to another corporation
which would, upon consummation, result in 
termination of this Stock Option in accordance with the Plan, this Stock
Option shall become immediately exercisable as to all unexercised Option Shares
notwithstanding the incremental exercise provisions of Paragraph 2 of this
Agreement, for a period then specified by the Board of Directors, but in any
event not less than thirty (30) days, on the condition that the terminating
event described in the Plan is consummated. If such terminating event is not
consummated, this Stock Option shall be exercisable in accordance with the
terms of the Agreement, excepting this Paragraph 10.

 

11.           Notification of Sale. Optionee
agrees that Optionee, or any person acquiring Option Shares upon exercise of
this Stock Option, will notify the Corporation in writing not more than five
(5) days after any sale or other disposition of such Shares.

 

12.           Approvals. This Stock Option
may not be exercised unless and until all applicable requirements of all
regulatory agencies having jurisdiction with respect thereto, and of the
securities exchanges upon which securities of the Corporation are listed, if
any, have been complied with.

 

5

 

13.           Notices. All notices to the
Corporation provided  for in this
Agreement shall be addressed to it in care of its Chief Executive Officer,
Chief Financial Officer or Secretary at its main office and all notices to
Optionee shall be addressed to Optionee’s address on file with the Corporation
or a Subsidiary, or to such other address as either may designate to the other
in writing, all in compliance with the notice provisions set forth in the Plan.

 

14.           Incorporation of Plan. All of
the provisions of  the Plan are
incorporated herein by reference as if set forth in full in this Agreement. In
the event of any conflict between the terms of the Plan and any provision
contained herein, the terms of the Plan shall be controlling and the
conflicting provisions contained herein shall be disregarded.

 

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

 

	
   

  	
  FIRST
  REGIONAL BANCORP

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  OPTIONEE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  

 

6

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