Document:

EX-4.1

 

Exhibit 4.1

REGISTRATION RIGHTS AGREEMENT

by and among

SOLUTIA, INC.

and

THE HOLDERS SET FORTH HEREIN

Dated as of November 19, 2007

 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page	 
	ARTICLE I. DEFINITIONS
	 	 	1	 
	 
	 	 	 	 
	ARTICLE II. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
	 	 	5	 
	 
	 	 	 	 
	SECTION 2.1 Representations and Warranties of the Company
	 	 	5	 
	 
	 	 	 	 
	ARTICLE III. SHELF REGISTRATION
	 	 	9	 
	 
	 	 	 	 
	SECTION 3.1 Shelf Registration Statement
	 	 	9	 
	SECTION 3.2 Shelf Registration Procedures
	 	 	9	 
	 
	 	 	 	 
	ARTICLE IV. UNDERWRITTEN OFFERINGS
	 	 	11	 
	 
	 	 	 	 
	SECTION 4.1 Right to Underwritten Offerings
	 	 	11	 
	SECTION 4.2 Underwritten Offering Procedures
	 	 	12	 
	 
	 	 	 	 
	ARTICLE V. PIGGYBACK REGISTRATION
	 	 	13	 
	 
	 	 	 	 
	SECTION 5.1 Right to Piggyback
	 	 	13	 
	SECTION 5.2 Priority on Piggyback Registrations
	 	 	14	 
	SECTION 5.3 Withdrawal of Piggyback Registration
	 	 	15	 
	 
	 	 	 	 
	ARTICLE VI. BLACKOUT PERIOD
	 	 	15	 
	 
	 	 	 	 
	SECTION 6.1 Shelf Registration and Piggyback Registration Blackout
	 	 	15	 
	SECTION 6.2 Blackout Period Limits
	 	 	16	 
	 
	 	 	 	 
	ARTICLE VII. PROCEDURES AND EXPENSES
	 	 	16	 
	 
	 	 	 	 
	SECTION 7.1 Registration Procedures
	 	 	16	 
	SECTION 7.2 Information from Holders; Holders’ Obligations
	 	 	21	 
	SECTION 7.3 Suspension of Disposition
	 	 	22	 
	SECTION 7.4 Registration Expenses
	 	 	23	 
	 
	 	 	 	 
	ARTICLE VIII. INDEMNIFICATION
	 	 	24	 
	 
	 	 	 	 
	SECTION 8.1 Indemnification by the Company
	 	 	24	 
	SECTION 8.2 Indemnification by Holders
	 	 	25	 
	SECTION 8.3 Conduct of Indemnification Proceedings
	 	 	25	 
	SECTION 8.4 Contribution, etc
	 	 	26	 
	 
	 	 	 	 
	ARTICLE IX. FREE WRITING PROSPECTUSES
	 	 	28	 
	 
	 	 	 	 
	ARTICLE X. RULE 144
	 	 	28	 
	 
	 	 	 	 
	ARTICLE XI. PRIVATE PLACEMENT
	 	 	28	 

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	 	 	Page	 
	ARTICLE XII. MISCELLANEOUS
	 	 	29	 
	 
	 	 	 	 
	SECTION 12.1 Notices
	 	 	29	 
	SECTION 12.2 Severability
	 	 	30	 
	SECTION 12.3 Assignment; Certain Specified Third Party Beneficiaries
	 	 	30	 
	SECTION 12.4 Entire Agreement
	 	 	30	 
	SECTION 12.5 Waivers and Amendments
	 	 	30	 
	SECTION 12.6 Counterparts
	 	 	31	 
	SECTION 12.7 Governing Law; Venue
	 	 	31	 
	SECTION 12.8 Headings
	 	 	31	 
	SECTION 12.9 Specific Performance
	 	 	31	 
	SECTION 12.10 Termination
	 	 	31	 
	SECTION 12.11 No Conflicting Rights
	 	 	31	 

	 	 	 
	EXHIBITS
	 	 
	 	 	 
	Exhibit A

	 	Form of Selling Securityholder Notice and Questionnaire
	 	 	 
	Exhibit B

	 	Form of Joinder Agreement

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REGISTRATION RIGHTS AGREEMENT

          This Registration Rights Agreement (this “Agreement”), dated as of November 19, 2007,
is made by and among (i) subject to the entry of the Agreement Order (as defined below), Solutia,
Inc., a Delaware corporation (as debtor-in-possession and a reorganized debtor, as applicable, the
“Company”), and (ii) the parties identified as “Backstop Investors” on the signature pages
hereto and any parties identified on the signature pages of any Joinder Agreements (as defined
below) executed and delivered pursuant to Section 12.3 hereto (each, including the Backstop
Investors, a “Holder” and, collectively, the “Holders”).

RECITALS

          WHEREAS, in connection with the consummation of the transactions contemplated by that
certain Commitment Agreement, dated as of October 15, 2007 (the “Commitment Agreement”),
by and among the Company and each of the Backstop Investors has agreed to acquire shares of New
Common Stock (as defined below) in accordance with the provisions of the Commitment Agreement;
and

          WHEREAS, in consideration of the Backstop Investors’ commitment to purchase shares of the New
Common Stock pursuant to and on the terms and conditions set forth in the Commitment Agreement, the
Company has agreed to enter into a registration rights agreement with respect to all of the shares
of New Common Stock held or acquired by the Holders.

AGREEMENTS

          NOW, THEREFORE, in consideration of the foregoing and the covenants and agreements contained
herein and in the Commitment Agreement and Amended Plan (as defined below), and intending to be
legally bound hereby, the parties hereto hereby agree as follows:

ARTICLE I.

DEFINITIONS

          For purposes of this Agreement, the following terms have the following meanings:

          “Affiliate” has the meaning given to that term pursuant to Rule 12b-2 under the
Exchange Act.

          “Agreement” has the meaning given to that term in the introductory paragraph hereof.

          “Agreement Order” means the order of the Bankruptcy Court granting the motion to
approve this Agreement and related relief.

          “Amended Plan” means the Debtors’ Fifth Amended Joint Plan of Reorganization attached
as Exhibit A to the related Disclosure Statement, as approved by Order of the Bank-

 

 

ruptcy Court
entered on October 19, 2007, as it may be amended or supplemented from time to time.

          “Bankruptcy Code” means Chapter 11, Title 11 of the United States Code, 11 U.S.C. 101
et seq.

          “Bankruptcy Court” means the United States Bankruptcy Court for the Southern District
of New York administering the Company’s bankruptcy case under the Bankruptcy Code together with the
applicable district court, to the extent district court approval of the Amended Plan, or any
transactions contemplated therein, is sought or required.

          “Bankruptcy Rules” means the Federal Rules of Bankruptcy Procedure.

          “Blackout Period” means any period during which, in accordance with Article VI hereof,
the Company is not required to effect the filing of a Registration Statement or is entitled to
postpone the preparation, filing or effectiveness or suspend the effectiveness of a Registration
Statement and/or the use of any resale Prospectus.

          “Business Day” means any day, other than a Saturday or Sunday, on which banking
institutions in New York, New York, are open.

          “Code” means the Internal Revenue Code of 1986, as amended.

          “Company” has the meaning given to that term in the introductory paragraph hereof.

          “Company Indemnified Person” shall have the meaning given to that term in Section 8.2
of this Agreement.

          “control” has the meaning given to that term under Rule 405 under the Securities Act
(and “controlled” and “controlling” shall have correlative meanings).

          “Effective Date” means each effective date or deemed effective date under the
Securities Act of any Registration Statement or any post-effective amendment thereto.

          “Commitment Agreement” has the meaning given that term in the recitals hereof.

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

          “Free Writing Prospectus” means a free writing prospectus as defined in Rule 405 under
the Securities Act relating to the Registrable Securities included in the applicable registration.

          “Holder” and “Holders” have the meanings given to those terms in the
introductory paragraph hereof.

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          “Holder Indemnified Person” shall have the meaning given to that term in Section 8.1
of this Agreement.

          “Holder Shelf Offering” has the meaning given to that term in Section 3.2(a) of this
Agreement.

          “Indemnified Person” has the meaning given to that term in Section 8.3 of this
Agreement.

          “Indemnifying Person” has the meaning given to that term in Section 8.3 of this
Agreement.

          “Issuer Free Writing Prospectus” means an issuer free writing prospectus as defined in
Rule 433 under the Securities Act.

          “Joinder Agreement” has the meaning given to that term in Section 12.3 of this
Agreement.

          “Lock-Up Period” has the meaning given to that term in Section 4.2(d) of this
Agreement.

          “Material Adverse Effect” has the meaning given to that term in Section 2.1(a) of this
Agreement.

          “Monsanto Registration Rights Agreement” means the registration rights agreement to be
entered into between the Company and Monsanto Company as contemplated by the Shelf Registration
Statement and the Amended Plan.

          “NASD” has the meaning given to that term in Section 7.1(m) of this Agreement.

          “NASDAQ” means the NASDAQ National Market.

          “New Common Stock” means the shares of new common stock of the Company issued on and
after the effective date of the Amended Plan and any additional shares of common stock paid, issued
or distributed in respect of any such shares by way of a stock dividend, stock split or
distribution, or in connection with a combination of shares, recapitalization, reorganization,
merger or consolidation, or otherwise.

          “NYSE” means the New York Stock Exchange.

          “Other Stockholders” means any Person (other than the Holders) having rights to
participate in a registration of the New Common Stock.

          “Person” means any individual, corporation, general or limited partnership, limited
liability company, joint venture, trust or other entity or association, including without
limitation any governmental authority.

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          “Piggyback Notice” has the meaning given to that term in Section 5.1 of this
Agreement.

          “Piggyback Registration” has the meaning given to that term in Section 5.1 of this
Agreement.

          “Preliminary Prospectus” has the meaning given to that term in Section 2.1(l) of this
Agreement.

          “Prospectus” means the prospectus relating to the Registrable Securities included in
the applicable Registration Statement, and any such prospectus as supplemented by any and all
prospectus supplements and as amended by any and all amendments (including post-effective
amendments) and including all material incorporated by reference or deemed to be incorporated by
reference in such Prospectus.

          “Questionnaire” has the meaning given to that term in Section 3.2(a) of this
Agreement.

          “Registrable Securities” means at any time (i) any shares of New Common Stock owned
beneficially or of record by a Holder, and (ii) any shares of New Common Stock or other securities
issued or issuable in respect of the New Common Stock which additional shares were paid, issued or
distributed in respect of any shares of New Common Stock by way of stock dividend, stock split or
distribution, or in connection with a combination of shares, recapitalization, reorganization,
merger or consolidation, or otherwise; provided, however, that as to any Registrable Securities,
such securities shall cease to constitute Registrable Securities upon the earliest to occur of: (i)
the date on which the securities are disposed of pursuant to an effective registration statement
under the Securities Act; (ii) the date on which the securities are disposed of pursuant to Rule
144 (or any successor provision) under the Securities Act; (iii) the date that all of such
securities held by a Holder are eligible to be disposed of pursuant to Rule 144 or any successor
thereto in a single transaction by such Holder; and (iv) the date on which the securities cease to
be outstanding.

          “Registration Expenses” has the meaning given to that term in Section 7.4(a) of this
Agreement.

          “Registration Statement” means any registration statement of the Company under the
Securities Act that covers any of the Registrable Securities pursuant to the provisions of this
Agreement, including the related Prospectus, all amendments and supplements to such registration
statement (including post-effective amendments), and all exhibits and all materials incorporated by
reference or deemed to be incorporated by reference in such registration statement.

          “Required Period” means four years following the later of (i) the Effective Date of
the Shelf Registration Statement and (ii) the effective date of Amended Plan, in each case as such
period may be extended pursuant to Section 6.2 and Section 7.3.

          “Rule 144” means Rule 144 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.

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          “SEC” means the United States Securities and Exchange Commission and any successor
United States federal agency or governmental authority having similar powers.

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

          “Selling Holder” means, with respect to a specified registration pursuant to this
Agreement, Holders whose Registrable Securities are included in such registration.

          “Selling Holder Information” has the meaning given to that term in Section 3.2(a) of
this Agreement.

          “Shelf Registration Statement” means the Registration Statement on Form S-3 filed by
the Company pursuant to Rule 415 of the Securities Act relating to the Registrable Securities on
October 26, 2007 and any new Registration Statement filed during the Required Period pursuant to
Section 415(a)(5) of the Securities Act relating to the Registrable Securities.

          “Subsidiary” or “Subsidiaries” means the direct and indirect subsidiaries of
the Company.

          “Syndication Agreement” has the meaning given to such term in the recitals hereof.

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

ARTICLE II.

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

          SECTION 2.1 Representations and Warranties of the Company. The Company represents and
warrants to, and agrees with, each Holder as set forth below, (i) with respect to Sections 2.1(a),
(b), (c), (f),(g), (l) and (m), as of the date hereof and (ii) with respect to all other
representations and warranties not expressly limited as to their date, as of each Effective Date:

     (a) Incorporation and Qualification. The Company and each of its Subsidiaries
is a legal entity duly organized, validly existing and in good standing under the laws of
their respective jurisdictions of organization, with the requisite power and authority to
own its properties and conduct its business as currently conducted, and is duly qualified as
a foreign corporation for the transaction of business and is in good standing under the laws
of each other jurisdiction in which it owns or leases properties or conducts any business so
as to require such qualification, except to the extent the failure to be so organized,
validly existing, qualified or in good standing has not had or would not reasonably be
expected to have, a Material Adverse Effect. For purposes of this Agreement, a
“Material Adverse Effect” shall mean any circumstance, change in or effect on the
Company and the Company’s Subsidiaries, taken as a whole, that individually or in the
aggregate with all other circumstances, changes in or effects on the Company and the
Company’s Subsidiaries, taken as a whole, is or is reasonably likely to be materially
adverse to the business

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operations, assets or liabilities (including without limitation
contingent liabilities), results of operations or the conditions (financial or otherwise) of
the Company and the Company’s Subsidiaries taken as a whole; provided,
however, that none of the following
shall be deemed, either alone or in combination, to constitute a Material Adverse
Effect: (i) changes in any statute, rule or regulation after the date hereof, (ii) changes
generally affecting the industries in which the Company and its Subsidiaries operate, (iii)
changes in laws, GAAP or accounting principles, and (iv) changes after the date hereof
resulting from the announcement or the existence of, or compliance with, this Agreement or
the Settlement Term Sheet, or the announcement of the Rights Offering, the Amended Plan or
any of the other transactions contemplated hereby or thereby; provided,
further, that any circumstance, change or effect described in clauses (i), (ii),
(iii) or (iv) shall not, either alone or in combination, constitute a “Material Adverse
Effect” only if the impact of such circumstance, change or effect on the Company and its
Subsidiaries, taken as a whole, is not materially disproportionate as compared to its impact
on other participants in the industries in which the Company and its Subsidiaries operate.

     (b) Corporate Power and Authority. The Company has the requisite corporate
power and authority to enter into, execute and deliver this Agreement and, subject to entry
of the Agreement Order and the expiration, or waiver by the Bankruptcy Court, of any
applicable waiting period set forth in the Bankruptcy Rules, respectively, to perform its
obligations hereunder. The Company has taken all necessary corporate action required for
the due authorization, execution, delivery and performance by it of this Agreement.

     (c) Execution and Delivery; Enforceability. This Agreement has been duly and
validly executed and delivered by the Company, and, upon the entry of the Agreement Order
and the expiration, or waiver by the Bankruptcy Court, of any applicable waiting period set
forth in the Bankruptcy Rules, this Agreement will constitute the valid and binding
obligation of the Company, enforceable against the Company in accordance with its terms.

     (d) Authorized Capital Stock. The authorized capital stock of the Company
conforms in all material respects to the authorized capital stock set forth in the
Registration Statement and Preliminary Prospectus and the issued and outstanding shares of
capital stock of the Company conforms in all material respects to the description set forth
in the Registration Statement and Preliminary Prospectus.

     (e) Issuance. All outstanding shares of New Common Stock have been duly and
validly issued, are fully paid and non-assessable, and are free and clear of all taxes,
liens, pre-emptive rights, rights of first refusal, subscription and similar rights.

     (f) No Conflict. Subject to the entry of the Agreement Order and the
expiration, or waiver by the Bankruptcy Court, of any applicable waiting period set forth in
the Bankruptcy Rules, the execution and delivery by the Company of this Agreement and
compliance by the Company with all of the provisions hereof and the consummation of the
transactions contemplated hereby (i) will not conflict with or result in a breach or
violation of, any of the terms or provisions of, or constitute a default under (with or
without notice or lapse of time, or both), or result in the acceleration of, or the creation
of any lien

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under, any indenture, mortgage, deed of trust, loan agreement or other agreement
or instrument to which the Company or any of its Subsidiaries is a party or by which the
Company or any of its Subsidiaries is bound or to which any of the property or assets of
the Company or any of its Subsidiaries is subject, (ii) will not result in any
violation of the provisions of the certificate of incorporation or bylaws of the Company
included in the Amended Plan and as applicable to the Company from and after the Effective
Date and (iii) will not result in any material violation of, or any termination or material
impairment of any rights under, any statute or any license, authorization, injunction,
judgment, order, decree, rule or regulation of any court or governmental agency or body
having jurisdiction over the Company or any of its Subsidiaries or any of their properties,
except in any such case described in subclause (i) or (iii) as have been described in an
effective Registration Statement or as will not have and are not reasonably expected to
have, individually or in the aggregate, a Material Adverse Effect.

     (g) Consents and Approvals. No consent, approval, authorization, order,
registration or qualification of or with any court or governmental agency or body having
jurisdiction over the Company or any of its Subsidiaries or any of their properties is
required for the execution and delivery by the Company of this Agreement and performance of
and compliance by the Company with all of the provisions hereof and the consummation by the
Company of the transactions contemplated hereby, except (i) the entry of the Agreement Order
and the expiration, or waiver by the Bankruptcy Court, of any applicable waiting period set
forth in the Bankruptcy Rules, (ii) the registration under the Securities Act of the
Registrable Securities contemplated hereby and (iii) such consents, approvals,
authorizations, registrations or qualifications (w) as may be required under NYSE or NASDAQ
rules and regulations in order to consummate the transactions contemplated herein, (x) as
may be required under state securities or Blue Sky laws in connection with the sale of the
 shares of New Common Stock by the Holders, (y) as have been described in an effective
Registration Statement or (z) the absence of which will not have or are not reasonably
expected to have, individually or in the aggregate, a Material Adverse Effect.

     (h) Exchange Act Documents. The documents incorporated by reference in the
Registration Statement or the Preliminary Prospectus, when they became effective or were
filed with the SEC, as the case may be, conformed in all material respects to the
requirements of the Exchange Act and, when read together with the other information included
or incorporated by reference in the Registration Statement, at the time the Registration
Statement became effective or the date of such Preliminary Prospectus, none of such
documents contained any untrue statement of a material fact or omitted 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; and any further documents
so filed and incorporated by reference in the Registration Statement or the Preliminary
Prospectus, when such documents become effective or are filed with the SEC, as the case may
be, will conform in all material respects to the requirements of the Securities Act or the
Exchange Act, as applicable, and will not, when read together with the other information
included or incorporated by reference in the Registration Statement and the Preliminary
Prospectus, contain any untrue statement of a material fact or omit to

-7-

 

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.

     (i) Issuer Free Writing Prospectus. Each Issuer Free Writing Prospectus
complies in all material respects with the Securities Act, has been filed in accordance with
the Securities Act (to the extent required thereby) and, when taken together with the
Preliminary Prospectus accompanying, or delivered prior to delivery of, such Issuer Free
Writing Prospectus, did not, and at the Effective Date will not, contain any 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; provided, that the Company makes no representation and warranty with
respect to any statements or omissions made in each such Issuer Free Writing Prospectus in
reliance upon and in conformity with information relating to any Holder furnished to the
Company in writing by such Holder expressly for use in any Issuer Free Writing Prospectus.

     (j) Preliminary Prospectus. Each Preliminary Prospectus, at the time of filing
thereof, will comply in all material respects with the Securities Act and will not contain
any untrue statement of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that the Company
makes no representation and warranty to an Holder with respect to any statements or
omissions made in each such Preliminary Prospectus in reliance upon and in conformity with
information relating to such Holder furnished to the Company in writing by such Holder
expressly for use in any Preliminary Prospectus. As used herein, the term “Preliminary
Prospectus” means each prospectus included in such registration statement (and any
amendments thereto) before it becomes effective, any prospectus filed with the SEC pursuant
to Rule 424(a) under the Securities Act and the prospectus included in the Registration
Statement, at the time of their respective effectiveness.

     (k) Registration Statement and Prospectus. As of the Effective Date of a
Registration Statement, such Registration Statement complies in all material respects with
the Securities Act, and does not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in order to make the
statements therein not misleading; and as of the applicable filing date of the Prospectus
and any amendment or supplement thereto, the Prospectus will not contain any untrue
statement of a material fact or omit to state a material fact required to be stated therein
or necessary in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided that the Company makes no
representation and warranty to a Holder with respect to any statements or omissions made in
such Registration Statement or Prospectus or amendment or supplement thereto in reliance
upon and in conformity with information relating to such Holder furnished to the Company in
writing by such Holder expressly for use in the Registration Statement and the Prospectus
and any amendment or supplement thereto.

     (l) No Registration Rights. Except (i) to the extent covered by the
Registration Statement and the Preliminary Prospectus and (ii) with respect to rights
granted

-8-

 

under this Agreement or the Monsanto Registration Rights Agreement, no Person has
the right to require the Company or any of its Subsidiaries to register any securities for
sale under the Securities Act or will have the right to require the Company or any of its
Subsidiaries to register any securities for sale under the Securities Act by reason of the
filing of the Registration Statement with the SEC.

     (m) The Company is not aware of any facts or circumstances that would prevent the Shelf
Registration Statement from being declared effective on the effective date of the Amended
Plan.

ARTICLE III.

SHELF REGISTRATION

          SECTION 3.1 Shelf Registration Statement. The Company has filed the Shelf
Registration Statement with the SEC on October 26, 2007 and will use its reasonable best efforts to
(i) file an amendment to the Shelf Registration Statement on or prior to two Business Days prior to
the effective date of the Amended Plan and (ii) cause the Shelf Registration Statement to be
declared effective by the SEC no later than the effective date of Amended Plan on an appropriate
form under the Securities Act relating to the offer and sale of the Registrable Securities by the
Holders thereof from time to time in accordance with the methods of distribution set forth in the
Shelf Registration Statement and Rule 415 under the Securities Act. Once the Shelf Registration
Statement is declared effective by the SEC, the Company shall use its reasonable best efforts to
cause the Shelf Registration Statement to remain continually effective, supplemented and amended,
and not subject to any stop order, injunction or similar order or requirement of the SEC, until the
earlier of (a) the expiration of the Required Period or (b) the date on which all Registrable
Securities shall cease to be Registrable Securities. The Company’s obligations under this Section
3.1 are subject to the provisions of Article VI.

          SECTION 3.2 Shelf Registration Procedures.

     (a) During the Required Period, any Holder shall be entitled, subject to the remainder
of this Section 3.2, to register all or any part of its Registrable Securities for sale
pursuant to the Shelf Registration Statement and to sell all or any part of the Registrable
Securities registered on behalf of such Holder pursuant to the Shelf Registration Statement
(“Holder Shelf Offering”). Notwithstanding any other provision of this Agreement,
no Holder may include any of its Registrable Securities in a Holder Shelf Offering pursuant
to this Agreement unless the Holder shall provide to the Company a fully completed notice
and questionnaire in substantially the form set forth in Exhibit A hereto (the
“Questionnaire”) and such other information in writing as may be reasonably
requested by the Company pursuant to Section 7.2 (the “Selling Holder Information”).
In order to be named as a selling securityholder in the Shelf Registration Statement or
Prospectus at the time it initially becomes effective under the Securities Act, each Holder
must no later than three Business Days prior to the Effective Date of the Shelf Registration
Statement, which will be at least 15 days following notice by the Company of the expected
initial Effective Date (the “Company Registration Notice”), furnish in writing the
completed Questionnaire and such other Selling Holder Information that the 

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Company may
reasonably request in writing, if any, to the Company. The Company Registration Notice
shall set forth (1) the expected Effective Date of the Shelf Registration Statement and
(2) the date by which Holders must return a completed Questionnaire in order
to be named as selling securityholders in the Shelf Registration Statement. In
addition, if such Company Registration Notice is given prior to the effective date of the
Amended Plan, then the Company shall provide the following information to the Holders on or
prior to five (5) Business Days prior to the Effective Date of the Shelf Registration
Statement: (a) for each class under the Amended Plan receiving shares of New Common Stock,
the approximate number of shares of New Common Stock that a holder of $1,000 in Allowed
Claims (as defined in the Amended Plan) of such class would receive on the effective date of
the Amended Plan and (b) for each series of notes under the Prepetition Indenture (as
defined in the Amended Plan), the approximate number of shares of New Common Stock that a
holder of $1,000 in principal amount of such series would receive on the effective date of
the Amended Plan.

     The Company shall include in the Shelf Registration Statement the information from the
completed Questionnaire and such other Selling Holder Information, if any, received by the
Company at least three Business Days prior to the initial Effective Date of the Shelf
Registration Statement and the Prospectus, as necessary in a manner so that upon such
effectiveness of the Shelf Registration Statement the Holder shall be named as a selling
securityholder and be permitted to deliver (or be deemed to deliver) such Prospectus to
purchasers of the Registrable Securities in accordance with applicable law. From and after
the date that the Shelf Registration Statement initially becomes effective, upon receipt of
a completed Questionnaire (including any updated Questionnaire) and such other Selling
Holder Information (including any updated Selling Holder Information) that the Company may
reasonably request in writing (including any amendments to any prior Questionnaire or
Selling Holder Information), if any, but in any event within 10 Business Days after the
Company receives the completed Questionnaire and such other Selling Holder Information, if
any, the Company shall use its reasonable best efforts to file any amendments or supplements
to the Shelf Registration Statement or Prospectus or the documents incorporated by reference
therein necessary for such Holder to be named as a selling securityholder and permit such
Holder to deliver (or be deemed to deliver) the Prospectus to purchasers of the Registrable
Securities (subject to the Company’s rights during a Blackout Period). Holders that do not
deliver a completed written Questionnaire and such other information, as provided for in
this Section 3.2(a), shall not be named as selling securityholders in the Prospectus until
such Holder delivers such information and the appropriate notice and other periods called
for by this Agreement shall have elapsed. If the Company shall file a post-effective
amendment to the Shelf Registration Statement, it shall use reasonable best efforts to cause
such post-effective amendment to be declared effective under the Securities Act as promptly
as is reasonably practicable and notify such Holder as promptly as practicable after the
effectiveness under the Securities Act of any post-effective amendment filed pursuant to
this Article III. If such Selling Holder Information is delivered during a Blackout Period,
the Company shall so inform the Holder delivering such Selling Holder Information and shall
take the actions set forth in this Section 3.2(a) upon expiration of the Blackout Period as
though such Holder’s Selling Holder Information had been delivered on the expiration date of
such Blackout Period.

-10-

 

     (b) Any Holder may, by written notice to the Company, request that the Company take any
commercially reasonable steps necessary to assist and cooperate with such Holder to
facilitate a Holder Shelf Offering, including by amending the Shelf Registration Statement and/or supplementing the Prospectus, subject to the provisions of this
Agreement. Such written notice shall specify the number of shares of Registrable Securities
proposed to be sold and shall also specify the intended method of disposition thereof.

     (c) At any time and from time to time after the Shelf Registration Statement becomes
effective, any Holder may request in writing that the Company file a supplement to the
Prospectus, or to the extent that it may be required, a post-effective amendment to the
Shelf Registration Statement, in order to update such Holder’s Selling Holder Information
(which written request shall be addressed to the Company, shall state that the request is
for a supplement or post-effective amendment pursuant to this Section 3.2(c) and shall
specify the Holder’s updated Selling Holder Information). The Company shall file a
supplement or post-effective amendment covering such requesting Holder’s or Holders’
Registrable Securities requested to be registered as promptly as practicable after receipt
of such request.

     (d) No Person, other than the Holders as contemplated by this Agreement and Monsanto
Company as contemplated by the Shelf Registration Statement and the Amended Plan, shall be
entitled to be named as a selling securityholder in the Shelf Registration Statement or
include any securities to be sold using the Shelf Registration Statement or the Prospectus.

ARTICLE IV.

UNDERWRITTEN OFFERINGS

          SECTION 4.1 Right to Underwritten Offerings. Following the Effective Date of the
Shelf Registration Statement, any Holder or Holders (collectively, the “Demanding Holders”)
shall have the right to request by delivery of a written notice to the Company (a “Shelf
Underwritten Demand Notice”), that the Company effect an Underwritten Offering of all or a
portion of the Registrable Securities included in the Shelf Registration Statement. Any such Shelf
Underwritten Demand Notice must request an underwritten offering of Registrable Securities having
an aggregate market value, based on the average per share closing price of the Registrable
Securities as reported on the principal exchange or market on which the Common Stock is then traded
over the 10 consecutive trading days prior to the date of the Shelf Underwritten Demand Notice, of
not less than $25,000,000. Any prospectus supplement or other filing with the SEC including a plan
or method of distribution of the securities subject to an Underwritten Offering pursuant to this
Section 4.1 shall reflect the plan or method of distribution of such securities as shall be
designated by the managing underwriter of the offering. The Company shall notify each other Holder
of such request (by delivering a copy of such request to each such Holder) for registration and
each other Holder may, by written notice to the Company given no later than 10 Business Days after
the Company’s notice is given to such Holder (which notice shall specify (i) the then-current name
and address of the Holder, (ii) the aggregate number of shares of Registrable Securities requested
to be registered in such registration by such Holder or group of Holders, and (iii) the total
number of shares of New Common Stock then held by such Holder), request

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that all or a part of such
Holder’s Registrable Securities be included in such registration. The Company shall file with the
SEC such amendments to the Shelf Registration Statement and such Prospectus supplements or other
filings that are necessary in connection with the Underwritten
Offering of the Registrable Securities subject to the Shelf Underwritten Demand Notice as
promptly as practicable (and, in any event, by the applicable Filing Date) after receipt of such
request, subject to Article VI.

          SECTION 4.2 Underwritten Offering Procedures.

     (a) No securities to be sold for the account of any Person (including the Company)
other than a Holder shall be included in an Underwritten Offering pursuant to Section 4.1 if
the managing underwriter of the Underwritten Offering relating thereto advises the Demanding
Holders that the total amount of Registrable Securities requested to be registered, together
with such other securities that the Company and any Other Stockholders propose to include in
such offering is such as to adversely affect the successful marketing (including the
pricing) of the securities included in such offering, in which case the Company shall
include in such registration all Registrable Securities requested to be included therein, up
to the full amount that, in the view of such managing underwriter can be sold without
adversely affecting the success of such offering, before including any securities of any
Person (including the Company) other than the Demanding Holders and the other Holders. If
the number of shares to be included in any such offering is less than the aggregate number
of Registrable Securities requested by Demanding Holders and the other Holders to be
included therein, then the Registrable Securities to be included in such offering shall be
allocated pro rata among such Demanding Holders and the other Holders on the basis of the
number of Registrable Securities requested by Demanding Holders and the other Holders to be
included therein.

     (b) Holders of a majority of Registrable Securities to be included in any Underwritten
Offering shall in their reasonable discretion and with the consent of the Company (which
consent shall not be unreasonably withheld) select an investment banking firm of national
standing to be the managing underwriter for any Underwritten Offering.

     (c) If so requested (pursuant to a timely written notice) by the managing underwriter
for the Underwritten Offering relating thereto, the Company shall not effect any
underwritten public sale or distribution of any securities for its own account or the
account of any Person not a party hereto that are the same as, or similar to, the
Registrable Securities, or any securities convertible into, or exchangeable or exercisable
for, any securities of the Company that are the same as, or similar to, the Registrable
Securities, during the 15-day period prior to, and during the 90-day period after, the date
a Registration Statement or amendments thereof for such Underwritten Offering becomes
effective (or if later, the date of pricing of the Underwritten Offering), as specified by
the managing underwriter.

     (d) If and to the extent requested by the managing underwriter for any Underwritten
Offering, each Holder who “beneficially owns” (as such term is defined under and determined
pursuant to Rule 13d-3 under the Exchange Act) 5% or more of the outstanding shares of New
Common Stock that is a party to this Agreement shall agree with

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such managing underwriter
(such agreement, a “Lock-Up”), for a period (the “Lock-Up Period”) beginning
on a date not earlier than 5 Business Days prior to the date of pricing of such Underwritten
Offering and ending not later than 90 days after the date of such
pricing, to the effect that such Holder shall not directly or indirectly (i) offer,
pledge, sell, contract to sell, grant any options for the sale of, seek the redemption of or
otherwise transfer or dispose of (including pursuant to a registration statement) any shares
of New Common Stock (or securities exchangeable or exercisable for any shares of New Common
Stock) held by such Holder, (ii) enter into a transaction which would have the same effect,
or enter into any swap, hedge or other arrangement that transfers, in whole or in part, any
of the economic consequences of ownership of the shares of New Common Stock held by such
Holder, whether any such aforementioned transaction is to be settled by delivery of shares
of New Common Stock or such other securities, in cash or otherwise, or (iii) publicly
disclose the intention to make any such offer, sale, pledge, transfer or disposition, or to
enter into any such transaction, swap, hedge or other arrangement, so long as the directors
and executive officers of the Company agree to such limits, except for any Holder that, not
later than 5 days following receipt of written notice from the Company that the Company will
be filing a Registration Statement within 15 days of such notice with respect to an
Underwritten Offering, shall have irrevocably agreed by delivery of written notice to the
Company to terminate all of its rights under this Agreement, including under any outstanding
Shelf Registration Statement; provided, that neither this Section 4.2(d) nor any
Lock-Up shall prohibit a Holder from exercising rights or complying with agreements entered
into by such Holder prior to the commencement of such Lock-Up Period or prevent such Holder
from selling pursuant to such Underwritten Offering; and provided further, that with respect
to any Holder that is a broker-dealer or an affiliate of a broker-dealer, the provisions of
any Lock-Up shall not apply to any transactions effected for or on behalf of any bona fide
customer or client of such Holder (other than a customer or client who is a beneficial owner
of the Registrable Securities held by such Holder).

     (e) Notwithstanding anything to the contrary herein, the Company shall have no
obligation to effect more than three (3) Underwritten Offerings in any 12-month period;
provided, that, if such Underwritten Offering is terminated by any stop order,
injunction, or other order of the SEC or if the conditions to closing specified in any
underwriting agreement or any other agreement entered into in connection with such
Underwritten Offering are not satisfied, other than by reason of some act or omission by a
Selling Holder, such Underwritten Offering will be deemed not to have been in effect and
will not count as an Underwritten Offering for purposes of the limitations in this Section
4.2(e).

ARTICLE V.

PIGGYBACK REGISTRATION

          SECTION 5.1 Right to Piggyback. If (i) the Shelf Registration Statement ceases to be
effective at any time during the Required Period, (ii) there are Registrable Securities outstanding
and (iii) the Company at any time proposes to file a registration statement under the Securities
Act with respect to an offering (a “Piggyback Registration”) of any New Common Stock

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(other
than a registration statement (a) on Form S-8 or any successor form thereto, (b) on Form S-4 or any
successor form thereto or (c) relating solely to a transaction under Rule 145 under the Securities
Act), whether or not for its own account, on a form that would permit registration of
Registrable Securities for sale to the public under the Securities Act, then the Company shall
give prompt written notice (the “Piggyback Notice”) of such proposed filing to the Holders
at least 10 Business Days before the anticipated filing date. The Piggyback Notice shall include
the number of shares of New Common Stock proposed to be registered, the proposed date of filing of
such registration statement, any proposed means of distribution, any proposed managing underwriter
and a good faith estimate by the Company of the proposed maximum offering price as such price is
proposed to appear on the facing page of such registration statement. The Company shall, subject
to Section 5.2, use its reasonable best efforts in order to provide the Holders with the
opportunity to request to register such amount of Registrable Securities as each Holder may specify
on the same terms and conditions as the registration of the Company’s or Other Stockholders’
securities, as the case may be (a “Piggyback Registration”). The Company shall use its
reasonable best efforts to include in such Piggyback Registration all Registrable Securities for
which the Company has received written requests for inclusion within 5 Business Days after delivery
of the Piggyback Notice, subject to Section 5.2 and Section 7.2. The Company’s obligations under
this Section 5.1 are subject to the provisions of Article VI.

          SECTION 5.2 Priority on Piggyback Registrations. If the Piggyback Registration is an
Underwritten Offering, the Company shall use its reasonable best efforts to cause the managing
underwriter of that proposed offering to permit the Holders that have requested Registrable
Securities to be included in the Piggyback Registration to include all such Registrable Securities
on the same terms and conditions as the registration of the Company’s securities. Notwithstanding
the foregoing, if the managing underwriter of such Underwritten Offering advises the Company and
the Selling Holders in writing that, in its view, the total amount of shares of New Common Stock
that the Company, such Holders and any Other Stockholders propose to include in such offering is
such as to adversely affect the successful marketing (including the pricing) of the securities
included in such Underwritten Offering, then:

     (i) if such Piggyback Registration is a primary registration by the Company for
its own account, the Company shall include in such Piggyback Registration: (A)
first, up to the full amount of (1) Registrable Securities requested to be
included in such Piggyback Registration by the Holders pursuant to Section 5.1
hereof and (2) Registrable Securities to be included in such registration by Holders
(as the capitalized terms used in this clause (2) are defined in the Monsanto
Registration Rights Agreement), allocated among such Holders (as defined herein and
in the Monsanto Registration Rights Agreement) on a pro rata basis based on the
amount of securities requested to be included in such Piggyback Registration or
registration, as the case may be; (B) second, up to the full amount of
securities to be offered by the Company, and (C) third, up to the full
amount of securities requested to be included in such Piggyback Registration by any
Other Stockholders in accordance with the priorities, if any, then existing among
the Company and the Other Stockholders so that the total amount of securities to be
included in such Underwritten Offering is the full amount that, in the view of such
managing underwriter, can be sold without adversely affecting the successful
marketing (including pricing) of the securities included in such Underwritten
Offering; and

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     (ii) if such Piggyback Registration is an underwritten secondary registration
for the account of holders of securities of the Company, the Company shall
include in such registration: (A) first, up to the full amount of (1)
Registrable Securities requested to be included in such Piggyback Registration by
the Holders pursuant to Section 5.1 hereof and (2) Registrable Securities to be
included in such registration by Holders (as the capitalized terms used in this
clause (2) are defined in the Monsanto Registration Rights Agreement), allocated
among such Holders (as defined herein and in the Monsanto Registration Rights
Agreement) on a pro rata basis based on the amount of securities requested to be
included in such Piggyback Registration or registration, as the case may be; (B)
second, up to the full amount of securities of the Persons exercising
“demand” registration rights requested to be included therein; (C) third, up
to the full amount of securities proposed to be included in the registration by the
Company; and (D) fourth, up to the full amount of securities requested to be
included in such Piggyback Registration by the Other Stockholders in accordance with
the priorities, if any, then existing among the Company and the Other Stockholders
so that the total amount of securities to be included in such Underwritten Offering
is the full amount that, in the view of such managing underwriter, can be sold
without adversely affecting the success of such Underwritten Offering.

          SECTION 5.3 Withdrawal of Piggyback Registration.

     (a) If at any time after giving the Piggyback Notice and prior to the effective date of
the Registration Statement filed in connection with the Piggyback Registration, the Company
determines for any reason not to register or to delay the Piggyback Registration, the
Company may, at its election, give notice of its determination to all Holders, and in the
case of a determination not to register, shall be relieved of its obligation to register any
Registrable Securities in connection with the abandoned Piggyback Registration, without
prejudice.

     (b) Any Holder of Registrable Securities requesting to be included in a Piggyback
Registration may withdraw its request for inclusion by giving written notice to the Company
of its intention to withdraw from that registration, provided, however, that (i) the
Holder’s request be made in writing and (ii) the withdrawal shall be irrevocable and, after
making the withdrawal, a Holder shall no longer have any right to include its Registrable
Securities in that Piggyback Registration.

     (c) An election by the Company to withdraw a Piggyback Registration under this Section
5.3 shall not be deemed to be a breach of the Company’s obligations with respect to such
Piggyback Registration.

ARTICLE VI.

BLACKOUT PERIOD

          SECTION 6.1 Shelf Registration and Piggyback Registration Blackout. Notwithstanding
any other provision of this Agreement to the contrary, if the President and Chief

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Executive Officer
of the Company determine in good faith, as evidenced by a signed certificate attesting to same,
that the registration and distribution of Registrable Securities (a) would materially impede, delay or interfere with, or require premature disclosure of, any material
financing, offering, acquisition, corporate reorganization or other significant transaction, or any
negotiations, discussions or pending proposals with respect thereto, involving the Company or any
of its Subsidiaries or (b) would require disclosure of non-public material information, the
disclosure of which would materially and adversely affect the Company, the Company shall (i) be
entitled to postpone the preparation, filing or effectiveness or suspend the effectiveness of a
Registration Statement and/or the use of any resale Prospectus for a reasonable period of time not
to exceed 60 days and (ii) promptly give the Holders notice of such postponement or suspension
(which notice need not specify the nature of the event giving rise to such suspension).

          SECTION 6.2 Blackout Period Limits. Notwithstanding anything contained in this
Article VI to the contrary, the Company (i) shall not be entitled to more than four Blackout
Periods during any consecutive 12-month period, and in no event shall the number of days included
in all Blackout Periods during any consecutive 12-month period exceed an aggregate of 60 days and
(ii) in no event shall the Company be entitled to postpone the preparation, filing or effectiveness
or suspend the effectiveness of a Registration Statement and/or the use of any resale Prospectus
included in a Registration Statement pursuant to this Article VI unless it postpones or suspends
during the Blackout Period the effectiveness of any registration statements required pursuant to
the registration rights of the Other Stockholders. In the event of the occurrence of any Blackout
Period, during the Required Period, the Required Period shall be extended by the number of days
during which such Blackout Period is in effect.

ARTICLE VII.

PROCEDURES AND EXPENSES

          SECTION 7.1 Registration Procedures. In connection with the Company’s registration
obligations pursuant to Articles III, IV and V, the Company shall use its reasonable best efforts
to effect such registrations to permit the sale of Registrable Securities by a Selling Holder in
accordance with the intended method or methods of disposition thereof, and pursuant thereto the
Company shall as promptly as reasonably practicable (to the extent such obligation has not already
been fulfilled):

     (a) prepare and file with the SEC a Registration Statement on an appropriate form under
the Securities Act available for the sale of the Registrable Securities by the Selling
Holders in accordance with the intended method or methods of distribution thereof; provided,
however, that the Company shall before filing, furnish to one firm of counsel for the
Selling Holders (selected by the Holders of a majority of the Registrable Securities in
accordance with Section 7.4) and the managing underwriter, if any, within a reasonable
period of time prior to the filing thereof with the SEC to afford to such counsel, the
Selling Holders, the managing underwriter and its counsel a reasonable opportunity for
review, copies of the Registration Statement or Prospectus proposed to be filed, and reflect
in each such document, when so filed with the SEC, such written comments as such counsel to
the Selling Holders and the managing underwriter may reasonably propose;

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     (b) furnish, at its expense, to the Selling Holders such number of conformed copies of
the Registration Statement and each amendment thereto, of the Prospectus and each supplement
thereto, and of such other documents as the Selling Holders reasonably may request in
writing from time to time;

     (c) subject to Article VI, prepare and file with the SEC any amendments and
post-effective amendments to the Registration Statement as may be necessary and any
supplements to the Prospectus as may be required or appropriate, in the view of the Company
and its counsel, by the rules, regulations or instructions applicable to the registration
form used by the Company or by the Securities Act to keep the Registration Statement
effective until the earlier of (i) such time as all shares of New Common Stock covered by
the Registration Statement cease to be Registrable Securities and (ii) the termination of
the Required Period (giving effect to any extensions thereof pursuant to Section 6.2 or
Section 7.3);

     (d) promptly following its actual knowledge thereof (but in any event within one
Business Day), notify the Selling Holders and the managing underwriter, if any, in writing:

     (i) when a Registration Statement, Prospectus, Issuer Free Writing Prospectus
or any supplement or amendment has been filed and, with respect to a Registration
Statement (including but not limited to the Shelf Registration Statement) or any
post-effective amendment, when the same has become effective;

     (ii) of any comments or inquiries by the SEC or any request by the SEC or any
other governmental authority for amendments or supplements to a Registration
Statement, Prospectus or Issuer Free Writing Prospectus or for additional
information (and to furnish the Selling Holders with copies of any correspondence
related thereto);

     (iii) of the issuance by the SEC or any other governmental authority of any
stop order or order preventing or suspending the effectiveness of a Registration
Statement or the use of any Prospectus or the initiation or threatening of any
proceedings for that purpose;

     (iv) of the receipt by the Company of any written notification with respect to
the suspension of the qualification or exemption from qualification of the
Registrable Securities for sale in any jurisdiction or the initiation or threatening
of any proceeding for such purpose;

     (v) of the occurrence of any event during the period a Registration Statement
is effective which makes any statement made in the Registration Statement or the
Prospectus or any Issuer Free Writing Prospectus untrue in any material respect or
which requires the making of any changes in such Registration Statement, Prospectus
or Issuer Free Writing Prospectus so that such Registration Statement, Prospectus or
Issuer Free Writing Prospectus shall not contain any untrue statement of a material
fact or omit to state any material fact required to be

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stated therein or necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading (provided, however,
that no notice by the Company shall be required pursuant to this Section 7.1(d)(v)
in the event that the Company either promptly files a Prospectus supplement to
update the Prospectus or an appropriate Exchange Act report that is incorporated by
reference into the Registration Statement, which, in either case, contains the
requisite information that results in such Registration Statement no longer
containing any untrue statement of a material fact or omitting to state a material
fact necessary to make the statements therein or in light of the circumstances under
which they were made, not misleading);

     (vi) of the Company’s reasonable determination that a post-effective amendment
to a Registration Statement would be required by applicable law (in which case the
Company shall file the same as soon as practicable after such determination and use
its reasonable best efforts to cause the same to become effective as soon as
practicable following filing);

     (e) use its reasonable best efforts to prevent the issuance of or obtain the withdrawal
of any order suspending the effectiveness of a Registration Statement, or the lifting of any
suspension of the qualification or exemption from qualification of any of the Registrable
Securities for sale in any jurisdiction, at the earliest practicable date or, if any such
order or suspension is made effective during any Blackout Period, at the earliest
practicable date after the Blackout Period;

     (f) prior to any public offering of Registrable Securities, use reasonable best efforts
to register or qualify, or cooperate with the Holders holding a majority of the Registrable
Securities, or counsel retained by the Selling Holders’ in accordance with Section 7.4, the
managing underwriter, if any, and its counsel in connection with the registration or
qualification (or exemption from such registration or qualification) of such Registrable
Securities for offer and sale under the securities or blue sky laws of such jurisdictions
within the United States as such counsel for the Selling Holders covered by a shelf
Registration Statement or the managing underwriter of an Underwritten Offering of
Registrable Securities reasonably requests in writing and do such other acts and things as
may be reasonably necessary to maintain each such registration or qualification (or
exemption therefrom) effective during the Required Period for such Registration Statement;
provided, however, that the Company shall not be required to qualify generally to do
business or as a dealer in securities in any jurisdiction in which it is not then so
qualified or take any action which would subject it to general service of process or
taxation in any jurisdiction in which it is not then so subject;

     (g) subject to Article VI, as promptly as reasonably practicable after the occurrence
of any event contemplated by Sections 7.1(d)(v) or 7.1(d)(vi) hereof, use its reasonable
best efforts to prepare (and furnish at its expense, subject to any notice by the Company in
accordance with Section 7.1(d), to the Selling Holders a reasonable number of copies of) a
supplement or post-effective amendment to the applicable Registration Statement or a
supplement to the related Prospectus (including by means of an Issuer Free Writing
Prospectus), or file any other required document so that, as thereafter deliv-

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ered to the purchasers of the Registrable Securities being sold thereunder, such
Prospectus or Issuer Free Writing Prospectus shall not contain an untrue statement of a
material fact or omit to state any material fact required to be stated therein or necessary
to make the statements therein, in light of the circumstances under which they were made,
not misleading;

     (h) enter into such agreements (including an underwriting agreement containing
representations and warranties and indemnity and contribution provisions of the type made in
customary underwriting agreements for an underwritten public offering), in usual and
customary form, and take such other actions as may be reasonably requested by the Selling
Holders or the managing underwriter, if any, to expedite the offer for sale or disposition
of the Registrable Securities, and in connection therewith, upon such request and upon the
date of closing of any sale of Registrable Securities in such Underwritten Registration:

     (i) use its reasonable best efforts to obtain opinions of counsel to the
Company (such counsel being reasonably satisfactory to the managing underwriter, if
any) and updates thereof covering matters customarily covered in opinions of counsel
in connection with Underwritten Offerings, addressed to each Selling Holder and the
managing underwriter, in each case which opinion and updates thereof shall each
state that it is being delivered at the request of the Company and solely in order
to assist the Selling Holders and the managing underwriter in establishing a “due
diligence” defense;

     (ii) use its reasonable best efforts to obtain customary “comfort” letters from
the independent registered public accountants of the Company (to the extent
deliverable in accordance with their professional standards) addressed to the
Selling Holder (to the extent consistent with Statement on Auditing Standards No.
100 of the American Institute of Certified Public Accountants) and the managing
underwriter, if any, in customary form and covering matters of the type customarily
covered in “comfort” letters in connection with Underwritten Offerings; and

     (iii) provide officers’ certificates and other customary closing documents
customarily delivered in connection with Underwritten Offerings and any reasonably
requested by the managing underwriter, if any;

provided that the Company shall only be required to comply with this clause (h) in
connection with an Underwritten Offering and on the initial Effective Date of any
Registration Statement.

     (i) upon reasonable notice and at reasonable times during normal business hours, make
reasonably available for inspection by a representative of each Selling Holder, one firm of
counsel for the Selling Holders retained in accordance with Section 7.4, the managing
underwriter, if any, participating in any disposition of Registrable Securities and its
counsel and any single accountant retained by the Selling Holders or any such underwriter,
all financial and other records, pertinent corporate documents and properties of the
Company, and cause the appropriate officers, directors and employees of the

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Company
to make reasonably available for such inspection all such relevant information
reasonably requested in writing by them in connection with the Registration Statement as is
customary for “due diligence” investigations of the type, nature and extent appropriate for
an offering of the type contemplated; provided that such Persons shall first agree
in writing with the Company that any information that is reasonably designated by the
Company as confidential at the time of delivery shall be kept confidential by such Persons
and shall be used solely for the purposes of exercising rights under this Agreement and such
Person shall not engage in trading any securities of the Company until such material
non-public information becomes publicly available, except nothing in such writing shall
restrict (i) disclosure of such information if it is required by court or administrative
order or is necessary to respond to inquiries of regulatory authorities, (ii) disclosure of
such information if it is required by law (including any disclosure requirements pursuant to
federal or state securities laws in connection with any disposition of Registrable
Securities), (iii) sharing information with other underwriters, agents or dealers
participating in the disposition of any Registrable Securities, subject to the execution by
such other underwriters, agents or dealers of reasonable non-disclosure agreements with the
Company and (iv) using any such documents or other information in investigating or defending
itself against claims made or threatened by purchasers, regulatory authorities or others in
connection with the disposition of any Registrable Securities.

     (j) use its reasonable best efforts to comply with all applicable rules and regulations
of the SEC relating to such registration and make generally available to its securityholders
earning statements satisfying the provisions of Section 11(a) of the Securities Act,
provided that the Company shall be deemed to have complied with this Section 7.1(j)
if it has satisfied the provisions of Rule 158 under the Securities Act (or any similar rule
promulgated under the Securities Act);

     (k) use its reasonable best efforts to cause all Registrable Securities covered by the
applicable Registration Statement if the New Common Stock is then listed on the NYSE or
quoted on the NASDAQ to continue to be so listed or quoted for a reasonable period of time
after the offering;

     (l) use its reasonable best efforts to procure the cooperation of the Company’s
transfer agent in settling any offering or sale of Registrable Securities;

     (m) use its reasonable best efforts to provide such information as may be reasonably
required for any filings required to be made by the Selling Holders or managing underwriter,
if any, with the National Association of Securities Dealers, Inc. (the “NASD”) in
connection with the offering under any Registration Statement of the Registrable Securities
(including, without limitation, such as may be required by NASD Rule 2710 or 2720), and,
upon the written request of the Holders of a majority of the Registrable Securities, shall
use its reasonable best efforts to cooperate in connection with any filings required to be
made with the NASD in that regard on or prior to the filing of any Registration Statement;
and

     (n) use its reasonable best efforts to assist Holders in the marketing of such
Registrable Securities (including without limitation, having officers of the Company at-

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tend “road shows” for Underwritten Offerings and analyst or investor presentations and
rating agency presentations and such other selling or informational activities requested by
the Holders of a majority of the Registrable Securities or the managing underwriter for such
Offerings upon reasonable prior notice and subject to reasonable scheduling flexibility;
provided, however, that officers of the Company will not be required to
attend more than one series of road shows in any 120 day period; provided,
further, that to the extent that any Underwritten Offering is suspended or postponed
for any reason not caused by the Holders and then subsequently re-instated, any previous
attendance by officers of road shows relating to such Underwritten Offering shall not excuse
the officers of the Company from attending subsequent road shows relating to such
Underwritten Offering for purposes of this Section 7.1(n), regardless if such subsequent
road shows are within 120 days of the previous road shows.

          SECTION 7.2 Information from Holders; Holders’ Obligations.

     (a) It shall be a condition precedent to the obligations of the Company to include the
Registrable Securities of any Selling Holder in any Registration Statement or Prospectus, as
the case may be, that such Selling Holder shall take the actions described in this Section
7.2.

     (b) Each Selling Holder that has requested inclusion of its Registrable Securities in
any Registration Statement shall furnish to the Company (as a condition precedent to such
Holder’s participation in such registration) a completed Questionnaire. Each Holder agrees
promptly to furnish to the Company in writing all information required to be disclosed in
order to make the information previously furnished to the Company by such Holder, in light
of the circumstances under which it was made, not misleading, any other information
regarding such Holder and the distribution of such Registrable Securities as may be required
to be disclosed in the Prospectus or Registration Statement under applicable law or pursuant
to SEC comments and any information otherwise reasonably required by the Company to comply
with applicable law or regulations.

     (c) Each Selling Holder shall promptly (i) following its actual knowledge thereof,
notify the Company of the occurrence of any event that makes any statement made in a
Registration Statement, Prospectus, Issuer Free Writing Prospectus or other Free Writing
Prospectus regarding such Selling Holder untrue in any material respect and that requires
the making of any changes in a Registration Statement, Prospectus or Free Writing Prospectus
so that, in such regard, it shall not contain any untrue statement of a material fact or
omit any material fact required to be stated therein or necessary to make the statements
regarding such Selling Holder, in light of the circumstances under which they were made, not
misleading and (ii) provide the Company with such information as may be required to enable
the Company to prepare a supplement or post-effective amendment to any such Registration
Statement or a supplement to such Prospectus or Free Writing Prospectus.

     (d) With respect to any Registration Statement for an Underwritten Offering, the
inclusion of a Holder’s Registrable Securities therein shall be conditioned, at the managing
underwriter’s request, upon the execution and delivery by such Holder of an

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underwriting agreement; provided that the underwriting agreement is in customary form
and reasonably acceptable to Company and the Holders of a majority of the Registrable
Securities to be included in the Underwritten Offering.

     (e) Each Selling Holder shall use reasonable best efforts to cooperate with the Company
in preparing the applicable registration.

     (f) Each Selling Holder agrees that no Holder of Registrable Securities 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
the Questionnaire and Selling Holder Information relating to such Holder.

     (g) Certain legal consequences arise from being named as a selling securityholder in a
registration statement and related prospectus. Accordingly, each Selling Holder
acknowledges that it has been advised to consult its own independent securities law counsel
regarding the consequences of demanding or requesting registration of Registrable Securities
hereunder or being named or not being named as a selling securityholder in the Registration
Statement and related Prospectus.

     (h) Each Selling Holder shall keep confidential that the Company has exercised its
rights under Article VI and shall keep confidential any other information provided by the
Company in connection with this Agreement that such Selling Holder reasonably believes is
confidential or that is reasonably designated by the Company as confidential at the time of
delivery, except nothing shall restrict (i) disclosure of such information if it is required
by court or administrative order or is necessary to respond to inquiries of regulatory
authorities, (ii) disclosure of such information if it is required by law (including any
disclosure requirements pursuant to federal or state securities laws in connection with any
disposition of Registrable Securities), (iii) sharing information with underwriters, agents
or dealers participating in the disposition of any Registrable Securities, subject to the
execution by such other underwriters, agents or dealers of reasonable non-disclosure
agreements with the Company, (iv) using any such documents or other information in
investigating or defending itself against claims made or threatened by purchasers,
regulatory authorities or others in connection with the disposition of any Registrable
Securities.

          SECTION 7.3 Suspension of Disposition.

     (a) Each Selling Holder agrees by acquisition of a Registrable Security that, upon
receipt of any written notice from the Company of the occurrence of any event of the type
described in Sections 7.1(d)(ii), 7.1(d)(iii), 7.1(d)(iv), 7.1(d)(v) or 7.1(d)(vi), such
Holder shall discontinue disposition of Registrable Securities covered by a Registration
Statement, Prospectus or Free Writing Prospectus and suspend use of such Prospectus or Free
Writing Prospectus until such Holder’s receipt of the copies of the supplemented or amended
Prospectus contemplated by Section 7.1(g) or until it is advised by the Company in writing
that the use of the applicable Prospectus or Free Writing Prospectus may be resumed and have
received copies of any additional or supplemental filings that are incorporated or deemed to
be incorporated by reference in such Prospectus

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or Free Writing Prospectus. In the event the Company shall give any such notice, the
Required Period shall be extended by the number of days during the time period from and
including the date of the giving of such notice to and including the date when each Selling
Holder of Registrable Securities covered by such Registration Statement has received (i) the
copies of the supplemented or amended Prospectus or Issuer Free Writing Prospectus
contemplated by Section 7.1(g) or (ii) the advice referenced in this Section 7.3(a).

     (b) Each Selling Holder shall be deemed to have agreed that, upon receipt of any notice
from the Company contemplated by Section 6.1, such Selling Holder shall discontinue
disposition of Registrable Securities covered by a Registration Statement, Prospectus or
Free Writing Prospectus and suspend use of such Prospectus or Free Writing Prospectus until
the earlier to occur of the Holder’s receipt of (i) copies of a supplemented or amended
Prospectus or Issuer Free Writing Prospectus and (ii)(A) written notice from the Company
that the use of the applicable Prospectus or Issuer Free Writing Prospectus may be resumed
and (B) copies of any additional or supplemental filings that are incorporated or deemed to
be incorporated by reference in such Prospectus or Issuer Free Writing Prospectus; provided,
however, that in no event shall the number of days during which the offer and sale of
Registrable Securities is discontinued pursuant to this Section 7.3(b) during any
consecutive 12-month period, together with any other Blackout Periods in such consecutive
12-month period, exceed an aggregate of sixty (60) days. In the event the Company gives any
such notice contemplated by Section 6.1, the period of time for which a Registration
Statement must remain effective pursuant to this Agreement shall be extended by the number
of days during the time period from and including the date of giving of such notice to and
including the date when each Selling Holder of Registrable Securities covered by such
Registration Statement receives (i) the supplemented or amended Prospectus or Issuer Free
Writing Prospectus or (ii) written notice from the Company that use of the applicable
Prospectus or Issuer Free Writing Prospectus may resume.

     (c) If so requested by the Company, each Holder shall deliver to the Company all copies
in such Holder’s possession, other than permanent file copies then in such Holder’s
possession or as may be required to be retained in accordance with applicable law, of the
Prospectus covering such Registrable Securities that was current at the time of receipt of
notice from the Company of any suspension contemplated by this Section 7.3.

          SECTION 7.4 Registration Expenses.

     (a) Without limiting any of the obligations in the Commitment Agreement or Article VIII
hereof, all fees and expenses incurred by the Company in complying with Articles III, IV and
V and Section 7.1 (“Registration Expenses”) shall be borne by the Company. These
fees and expenses shall include without limitation (i) all registration, filing and
qualification fees, including fees made with the NASD, (ii) printing, duplicating and
delivery expenses, (iii) fees and disbursements of counsel for the Company, (iv) fees and
expenses of complying with state securities or “blue sky” laws (including the reasonable,
documented fees and expenses of the counsel specified in Section 7.4(b) in connection
therewith), (v) fees and disbursements of all independent registered public accountants
referred to in Section 7.1(h)(ii) (including the expenses of any special audit and

-23-

 

“comfort” letters required by or incident to such performance) and (vi) fees and
expenses in connection with listing the Registrable Securities on the NYSE or quoting the
Registrable Securities on the NASDAQ or any other exchange or automated trading system in
accordance with the other terms of this Agreement.

     (b) The Company shall also reimburse or pay, as the case may be, the reasonable fees
and reasonable out-of-pocket expenses of one law firm (which shall be a nationally
recognized law firm experienced in securities law matters) retained by the Holders within 30
days of presentation of an invoice by such Holders (which law firm shall be selected (i) by
Highland Crusader Holding Corporation (“Crusader”), if Crusader holds any of the
Registrable Securities included in any applicable registration and (ii) by the Holders
holding at least a majority of the Registrable Securities included in the applicable
registration, if Crusader does not hold any of the Registrable Securities included in any
applicable registration). Notwithstanding the foregoing, the Company agrees that until the
Effective Date of the Shelf Registration Statement, all Transaction Expenses (as defined in
the Commitment Agreement), including any expenses incurred by any Holder or its advisors
with respect to the Shelf Registration Statement, shall be paid by the Company in accordance
with Section 2(d) of the Commitment Agreement.

     (c) Notwithstanding anything contained herein to the contrary, all underwriting fees,
discounts, selling commissions and stock transfer taxes applicable to the sale of
Registrable Securities shall be borne by the Holder owning such Registrable Securities.

ARTICLE VIII.

INDEMNIFICATION

          SECTION 8.1 Indemnification by the Company. The Company agrees to indemnify and hold
harmless each Holder of Registrable Securities that are included in a Registration Statement
pursuant to this Agreement, such Holder’s Affiliates, and their respective officers, directors,
employees, partners and agents, and each Person, if any, who controls any such Holder within the
meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act and any
underwriter (as defined in the Securities Act), selling agent or other securities professional for
such Holder that facilities the disposition of Registrable Securities for such Holder, and any
Person who controls such underwriter, selling agent or other securities professional within the
meaning of either Section 15 of the Securities Act or Section 20 of the Exchange Act (each, a
“Holder Indemnified Person”), from and against, and agrees to reimburse each Holder
Indemnified Person with respect to, any and all losses, claims, damages, liabilities and expenses
(including without limitation, subject to Section 8.3, the reasonable legal fees and other
reasonable out-of-pocket expenses incurred in investigating, responding to or defending against any
claim, challenge, litigation, investigation or proceeding, including without limitation, all costs
of appearing as a witness in any claim, challenge, litigation, investigation or proceeding)
(collectively, “Damages”) based upon, arising out of or resulting from, (i) any untrue
statement or alleged untrue statement of a material fact contained in any Registration Statement,
Prospectus, Preliminary Prospectus or Issuer Free Writing Prospectus, relating to the Registrable
Securities, or any amendment thereof or supplement thereto, or any omission or alleged omission to
state therein a material fact required to be stated therein or necessary, in light of the
circumstances un-

-24-

 

der which they were made, to make the statements therein not misleading or (ii) any violation
or alleged violation by the Company of the Securities Act, the Exchange Act, any federal or state
securities law or any rule or regulation promulgated under the Securities, the Exchange Act or any
federal or state securities law in connection with any Registration Statement, Prospectus,
Preliminary Prospectus or Issuer Free Writing Prospectus, relating to the Registrable Securities,
or any amendment thereof or supplement thereto; provided, however, that the Company
shall not be liable in any such case to the extent that any such Damages arise out of or are based
upon an untrue statement or omission or alleged untrue statement or alleged omission made in such
Registration Statement, Prospectus, Preliminary Prospectus or Free Writing Prospectus, or any
amendment thereof or supplement thereto, in strict conformity with information relating to any
Holder furnished to the Company in writing by such Holder or Holder Indemnified Person expressly
for use therein.

          SECTION 8.2 Indemnification by Holders. Each Holder agrees, severally and not
jointly, to indemnify and hold harmless, the Company, the Company’s Affiliates, and their
respective officers, directors, employees, partners and agents, and each Person, if any, who
controls the Company within the meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act (each, a “Company Indemnified Person”), from and against, and to reimburse
each Company Indemnified Person with respect to, any and all Damages, based upon, arising out of or
resulting from, (i) any untrue statement or alleged untrue statement of a material fact contained
in any Registration Statement, Prospectus, Preliminary Prospectus or Issuer Free Writing
Prospectus, relating to the offer and sale of Registrable Securities, or any amendment thereof or
supplement thereto, or any omission or alleged omission to state therein a material fact required
to be stated therein or necessary, in light of the circumstances under which they were made, to
make the statements therein not misleading, in each case to the extent, but only to the extent,
that any such untrue statement or omission or alleged untrue statement or alleged omission was made
in such Registration Statement, Prospectus, Preliminary Prospectus or Free Writing Prospectus, or
any amendment thereof or supplement thereto, in strict conformity with information relating to any
Holder furnished to the Company in writing by such Holder or Holder Indemnified Person expressly
for use therein and (ii) any violation or alleged violation by such Holder of the Securities Act,
the Exchange Act, any federal or state securities law or any rule or regulation promulgated under
the Securities, the Exchange Act or any federal or state securities law in connection with any
Registration Statement, Prospectus, Preliminary Prospectus or Issuer Free Writing Prospectus,
relating to the Registrable Securities, or any amendment thereof or supplement thereto;
provided, however, the liability of each Holder will be in proportion to, and such
liability will be limited to, the gross amount received by such Holder from the sale of Registrable
Securities pursuant to such Registration Statement; provided, further, that a
Holder shall not be liable in any case to the extent that prior to the filing of any such
Registration Statement, Prospectus, Preliminary Prospectus or Free Writing Prospectus, or any
amendment thereof or supplement thereto, such Holder has furnished in writing to the Company,
information expressly for use in, and within a reasonable period of time prior to the effectiveness
of, such Registration Statement, Prospectus, Preliminary Prospectus or Free Writing Prospectus, or
any amendment thereof or supplement thereto which corrected or made not misleading information
previously provided to the Company.

          SECTION 8.3 Conduct of Indemnification Proceedings. If any claim, challenge,
litigation, investigation or proceeding (including any governmental or regulatory investigation)

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shall be brought or asserted against any Person in respect of which indemnity may be sought
pursuant to either of Section 8.1 or Section 8.2, such Person (the “Indemnified Person”)
shall promptly notify the Person against whom such indemnity may be sought (the “Indemnifying
Person”) in writing; provided that (i) the omission to so notify the Indemnifying
Person shall not relieve it from any liability that it may have hereunder except to the extent it
has been materially prejudiced by such failure and (ii) the omission to so notify the Indemnifying
Person shall not relieve it from any liability that it may have to an Indemnified Person otherwise
than on account of this Article VIII. In case any such claim, challenge, litigation, investigation
or proceeding is brought against any Indemnified Person and it notifies the Indemnifying Person of
the commencement thereof, the Indemnifying Person shall be entitled to participate therein and, to
the extent that it may elect by written notice delivered to such Indemnified Person, to assume the
defense thereof and retain counsel reasonably satisfactory to the Indemnified Person to represent
the Indemnified Person and any others the Indemnifying Person may designate in such proceeding and
shall pay the reasonable fees and expenses of such counsel related to such proceeding. In any such
proceeding, any Indemnified Person shall have the right to retain its own counsel, but the fees and
expenses of such counsel shall be at the expense of such Indemnified Person unless (i) the
Indemnifying Person and the Indemnified Person shall have mutually agreed in writing to the
contrary, (ii) the Indemnifying Person shall have failed within a reasonable time to retain counsel
reasonably satisfactory to the Indemnified Person as contemplated by the preceding sentence or
(iii) the named parties in 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 conflicts of interests between them. It
is understood that the Indemnifying Person shall not, in connection with any proceeding or related
proceeding in the same jurisdiction, be liable for the fees and expenses of more than one separate
firm (in addition to any local counsel) for all Indemnified Persons, and that all such fees and
expenses shall be reimbursed as they are incurred. Any such separate firm for the Holders and such
control Persons of the Holders shall be designated in writing by the Holders and any such separate
firm for the Company, the directors and officers of the Company and such control Persons of the
Company shall be designated in writing by the Company. The Indemnifying Person shall not be liable
for any settlement of any pending or threatened proceeding effected without its prior written
consent (which consent shall not be unreasonably withheld), but if settled with such consent or if
there be a final judgment for the plaintiff, the Indemnifying Person agrees to indemnify in
accordance with, and subject to the limitations of, Section 8.1 and Section 8.2 above, as the case
may be, any Indemnified Person from and against any loss or liability by reason of such settlement
or judgment. No Indemnifying Person shall, without the prior written consent of the Indemnified
Persons (which consent shall not be unreasonably withheld), effect any settlement of any pending
proceeding in respect of which any Indemnified Person is a party or of any threatened proceeding in
respect of which any Indemnified Person could have been a party and indemnity could have been
sought hereunder by such Indemnified Person, unless such settlement (i) includes an unconditional
release of such Indemnified Person from all liability on claims that are the subject matter of such
proceeding and (ii) does not include any statement as to or any admission of fault, culpability or
a failure to act by or on behalf of any Indemnified Person.

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          SECTION 8.4 Contribution, etc.

     (a) If the indemnification provided for in this Article VIII is held by a court of
competent jurisdiction to be unavailable to an Indemnified Person or insufficient in respect
of any Damages referred to therein, then each Indemnifying Person under such paragraph, in
lieu of indemnifying such Indemnified Person thereunder, shall contribute to the amount paid
or payable by such Indemnified Person as a result of such Damages (i) in such proportion as
is appropriate to reflect the relative benefits received by the Company on the one hand and
the Holder on the other hand with respect to the sale by such Holder of Registrable
Securities or (ii) if the allocation provided by clause (i) above is not permitted by
applicable law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the Company on the
one hand and of such Holder on the other in connection with the statements or omissions that
resulted in such Damages, as well as any other relevant equitable considerations. Benefits
received by the Company shall be deemed to be equal to the total value received or proposed
to be received (before deducting expenses) by the Company pursuant to the sale of New Common
Stock contemplated by the Commitment Agreement. Benefits received by any Holder shall be
deemed to be equal to the value to such Holder of having the offer and sale of the
Registrable Securities registered under the Securities Act. The relative fault of the
Company on the one hand and such Holder on the other shall be determined by reference to,
among other things, whether any untrue or any alleged untrue statement of a material fact or
the omission or alleged omission to state a material fact relates to information supplied by
the Company or by such Holder and the parties’ relevant intent, knowledge, information and
opportunity to correct or prevent such statement or omission.

     (b) The Company and the Holders agree that it would not be just and equitable if
contribution pursuant to this Article VIII were determined by pro rata allocation (even if
the Holders were treated as one entity for such purpose) or any other method of allocation
that does not take account of the equitable considerations referred to in this Section 8.4.
The amount paid or payable by an Indemnified Person as a result of Damages referred to in
this Section 8.4 shall be deemed to include, subject to the limitations set forth in
Sections 8.1, 8.2 and 8.3 above, any reasonable legal or other reasonable out-of-pocket
expenses incurred by such Indemnified Person not otherwise reimbursed in connection with
investigating or defending any such action or claim. Notwithstanding the provisions of this
Article VIII, in no event shall any Holder be required to contribute any amount in excess of
the amount by which the gross amount received by such Holder with respect to its sale of
Registrable Securities pursuant to any Registration Statement exceeds the amount of any
damages that such Holder has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be
entitled to contribution from any Person who was not guilty of such fraudulent
misrepresentation.

     (c) The remedies provided for in this Article VIII are not exclusive and shall not
limit any rights or remedies which may otherwise be available to any Indemnified Person at
law or in equity.

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     (d) The indemnity and contribution agreements contained in this Article VIII 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 Indemnified Person or
by or on behalf of any Company Indemnified Person and (iii) the sale by a Holder of
Registrable Securities covered by any Registration Statement.

ARTICLE IX.

FREE WRITING PROSPECTUSES

          Except a Prospectus, an Issuer Free Writing Prospectus or other materials prepared by the
Company, each Holder represents and agrees that it (i) shall not make any offer relating to the
Registrable Securities that would constitute an Issuer Free Writing Prospectus or that would
otherwise constitute a Free Writing Prospectus, and (ii) has not distributed and will not
distribute any written materials in connection with the offer or sale of New Common Stock, in each
case without the prior written consent of the Company and, in connection with any Underwritten
Offering, the underwriters. The Company represents and agrees that it shall not make any offer
relating to the Registrable Securities that would constitute an Issuer Free Writing Prospectus or
that would otherwise constitute a Free Writing Prospectus in connection with the offer or sale of
Registrable Securities without the prior written consent of the Holders of a majority of the
Registrable Securities that are registered under the Registration Statement to be included in an
Underwritten Offering and, in connection with any Underwritten Offering, the underwriters.

ARTICLE X.

RULE 144

          With a view to making available the benefits of certain rules and regulations of the SEC which
may permit the sale of Registrable Securities to the public without registration, the Company
agrees to (a) use its reasonable best efforts to file with the SEC in a timely manner all reports
and other documents required of the Company under the Exchange Act; (b) upon written request of any
Holder of Registrable Securities, furnish to such Holder promptly a written statement by the
Company as to its compliance with the reporting requirements of Rule 144 and of the Exchange Act,
and such other reports and documents as any Holder reasonably may request in availing itself of any
rule or regulation of the SEC allowing such Holder to sell any Registrable Securities without
registration; and (c) take such other actions as may be reasonably required by the Company’s
transfer agent to consummate any distribution of Registrable Securities that may be permitted in
accordance with the terms and conditions of Rule 144.

ARTICLE XI.

PRIVATE PLACEMENT

          Except for Section 4.2(d), the Company agrees that nothing in this Agreement shall prohibit
the Holders, at any time and from time to time, from selling or otherwise transferring Registrable
Securities pursuant to a private placement or other transaction which is not registered pursuant to
the Securities Act. To the extent requested by a Holder, the Company shall

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take all reasonable steps necessary to assist and cooperate with such Holder to facilitate
such sale or transfer, including providing due diligence access to potential purchasers, and
entering into a private placement agreement containing customary representations and warranties,
indemnifications, opinions and other typical closing conditions.

ARTICLE XII.

MISCELLANEOUS

          SECTION 12.1 Notices. All notices and other communications in connection with this
Agreement shall be in writing and shall be deemed given by (and shall be deemed to have been duly
given) as follows: (i) at the time delivered by hand, if delivered personally; (ii) when sent via
facsimile (with confirmation); (iii) 5 Business Days after being deposited in the mail, if sent
postage prepaid, by registered or certified mail (return receipt requested); or (iv) on the next
Business Day, if timely delivered to an express courier guaranteeing overnight delivery (with
confirmation). Notices shall be directed to the parties at the following addresses (or at such
other address for a party as shall be specified by like notice):

          (a) If to the Company:

Solutia Inc.

575 Maryville Centre Drive

P.O. Box 66760

St Louis, Missouri

Attention: General Counsel

Fax: (314) 674-8703

with a copy to:

Kirkland & Ellis LLP

153 East 53rd Street

New York, New York 10022-4611

Attention: Thomas W. Christopher

                    Jonathan S. Henes

Fax: (212) 446-4900

     (b) If to any Holder to the address and facsimile number set forth on the signature
pages hereto, or the signature page of any Joinder Agreement executed and delivered pursuant
to Section 12.3:

with a copy to:

Haynes and Boone, LLP

901 Main St., Suite 3100

Dallas, TX 75202

Attention: Janice V. Sharry

Fax: (214) 200-0620

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          SECTION 12.2 Severability. If any provision of this Agreement shall be invalid or
unenforceable, such invalidity or unenforceability shall not affect the validity and enforceability
of the remaining provisions of this Agreement, unless the result thereof would be unreasonable in
which case the parties hereto shall negotiate in good faith as to appropriate amendments hereto.

          SECTION 12.3 Assignment; Certain Specified Third Party Beneficiaries. This Agreement
shall be binding upon, inure to the benefit of and be enforceable by each of the parties and their
respective successors and assigns; provided, however, that neither this Agreement nor any of the
rights, interests or obligations hereunder shall be assigned or delegated by a Holder to any third
party who purchases or is otherwise a permitted transferee of such Registrable Securities from the
Holder, unless (i) such transferee shall receive from the transferring Holder at least 100,000
shares of Common Stock, (ii) such transferee of the Registrable Securities that is not a party to
this Agreement shall have executed and delivered to the Company a properly completed joinder
agreement (“Joinder Agreement”) substantially in the form of Exhibit B, and (iii)
the Holder selling the Registrable Securities shall have delivered to the Company written notice of
such transfer setting forth the name of such Holder, the name and address of the transferee and the
number of Registrable Securities that shall have been so transferred. Notwithstanding the
foregoing sentence, this Agreement and the rights, interests and obligations hereunder may be
assigned, transferred or delegated by an Holder to any Affiliate of such Holder, provided that any
such transferee or assignee assumes the obligations of such Holder hereunder and agrees in writing
to be bound by the terms of this Agreement in the same manner as the Holder pursuant to a properly
completed Joinder Agreement. This Agreement (including the documents and instruments referred to
in this Agreement) is not intended to and does not confer upon any Person any rights or remedies
under this Agreement other than the parties hereto, their permitted successors and assigns and any
Indemnified Person.

          SECTION 12.4 Entire Agreement. This Agreement (including the documents and
instruments referred to in this Agreement) constitutes the entire agreement of the parties and
supersedes all prior agreements and understandings, whether written or oral, between the parties
with respect to the subject matter of this Agreement.

          SECTION 12.5 Waivers and Amendments. This Agreement may be amended, modified,
superseded, cancelled, renewed or extended, and the terms and conditions of this Agreement may be
waived, only by a written instrument, (A) if prior to the effective date of the Amended Plan,
signed by (i) the Company, and (ii) holders of a 66 2/3% of commitments under the Commitment
Agreement, (B) if after the effective date of the Amended Plan, signed by (i) the Company, and (ii)
Holders of a majority of the Registrable Securities. No delay on the part of any party in
exercising any right, power or privilege pursuant to this Agreement shall operate as a waiver
thereof, nor shall any waiver on the part of any party of any right, power or privilege pursuant to
this Agreement, nor shall any single or partial exercise of any right, power or privilege pursuant
to this Agreement, preclude any other or further exercise thereof or the exercise of any other
right, power or privilege pursuant to this Agreement. The rights and remedies provided pursuant to
this Agreement are cumulative and are not exclusive of any rights or remedies which any party
otherwise may have at law or in equity.

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          SECTION 12.6 Counterparts. This Agreement may be executed in any number of
counterparts, all of which shall be considered one and the same agreement and shall become
effective when counterparts have been signed by each of the parties and delivered to the other
party (including via facsimile or other electronic transmission), it being understood that each
party need not sign the same counterpart.

          SECTION 12.7 Governing Law; Venue. THIS AGREEMENT SHALL BE GOVERNED AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF LAW
PRINCIPLES. EACH PARTY TO THIS AGREEMENT IRREVOCABLY SUBMITS TO THE JURISDICTION OF, AND VENUE IN,
THE DISTRICT COURTS OF THE UNITED STATES SITTING IN THE SOUTHERN DISTRICT OF NEW YORK OR THE COURTS
OF THE STATE OF NEW YORK SITTING IN THE COUNTY OF NEW YORK AND WAIVES ANY OBJECTION BASED ON FORUM
NON CONVENIENS.

          SECTION 12.8 Headings. The headings in this Agreement are for reference purposes
only and shall not in any way affect the meaning or interpretation of this Agreement.

          SECTION 12.9 Specific Performance. The parties acknowledge and agree that any breach
of the terms of this Agreement would give rise to irreparable harm for which money damages would
not be an adequate remedy, and, accordingly, the parties agree that, in addition to any other
remedies, each will be entitled to enforce the terms of this Agreement by a decree of specific
performance without the necessity of proving the inadequacy of money damages as a remedy and
without the necessity of posting bond.

          SECTION 12.10 Termination. This Agreement may be terminated at any time by a written
instrument signed by each of the parties hereto. Unless sooner terminated in accordance with the
preceding sentence, this Agreement (other than Section 7.4 and Article VIII) shall terminate when
there are no Registrable Securities outstanding.

          SECTION 12.11 No Conflicting Rights. The Company shall not, on or after the date
hereof, grant any registration or similar rights to any Person which by their terms are not
subordinate to or pari passu with the registration rights granted to the Holders in this Agreement
or which conflict with or impair the rights granted hereby.

[Signature Page Follows]

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

	 	 	 	 	 
	 	SOLUTIA, INC.

 	 
	 	By:  	/s/ Jeffry N. Quinn
 	 
	 	 	Name:  	Jeffry N. Quinn 	 
	 	 	Title:  	President and CEO 	 
	 

[Signature Page of Registration Rights Agreement]

 

 

	 	 	 	 	 	 	 
	 	 	BACKSTOP INVESTORS	 	 
	 
	 	 	 	 	 	 
	 	 	HIGHLAND CRUSADER HOLDING CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Michael Colvin	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Michael Colvin	 	 
	 

	 	 	 	Title: Secretary	 	 
	 
	 	 	 	 	 	 
	 	 	Address:	 	 
	 	 	Two Galleria Tower

13455 Noel Road, Suite 800

Dallas, TX 75240-6620

Attention: Patrick Conner

Fax: (972) 628-4147	 	 

[Signature Page of Registration Rights Agreement]

 

 

	 	 	 	 	 	 	 
	 	 	LONGACRE FUND MANAGEMENT,	 	 
	 	 	L.L.C., as Investment Manager, on behalf	 	 
	 	 	of Longacre Master Fund, Ltd and Longacre	 	 
	 	 	Capital Partners (QP), L.P.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Steven Weissman	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Steven Weissman	 	 
	 

	 	 	 	Title: Member	 	 
	 
	 	 	 	 	 	 
	 	 	Address:	 	 
	 	 	810 Seventh Avenue, 22nd Floor	 	 
	 	 	New York, NY 10019	 	 
	 	 	Attention: John Brecker	 	 
	 	 	Fax: (212) 259-4304	 	 

[Signature Page of Registration Rights Agreement]

 

 

	 	 	 	 	 	 	 
	 	 	MERRILL LYNCH PIERCE, FENNER
& SMITH INCORPORATED	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ronald Torok	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Ronald Torok	 	 
	 

	 	 	 	Title: Director	 	 
	 
	 	 	 	 	 	 
	 	 	Address:	 	 
	 	 	4 World Financial Center

250 Vesey Street

New York, NY 10080

Attention: Chris Moon/Ron Torok

Fax: (212) 449-0769	 	 

S-1

 

	 	 	 	 	 	 	 
	 	 	GMAM INVESTMENT FUNDS TRUST II	 	 
	 	 	By: Murray Capital Management, Inc., its agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Scott V. Beechert	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Scott V. Beechert	 	 
	 

	 	 	 	Title: General Counsel & Chief Compliance Officer	 	 
	 
	 	 	 	 	 	 
	 	 	RECAP INTERNATIONAL (MASTER) LTD.	 	 
	 	 	By: Murray Capital Management, Inc., its agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Scott V. Beechert	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Scott V. Beechert	 	 
	 

	 	 	 	Title: General Counsel & Chief Compliance Officer	 	 
	 
	 	 	 	 	 	 
	 	 	INSTITUTIONAL BENCHMARK SERIES (MASTER FEEDER) LTD., a segregated
accounts company, solely with respect to the Muscida series.	 	 
	 	 	By: Murray Capital Management, Inc., its agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Scott V. Beechert	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Scott V. Beechert	 	 
	 

	 	 	 	Title: General Counsel & Chief Compliance Officer	 	 
	 
	 	 	 	 	 	 
	 	 	Address (for the above three entities):

c/o Murray Capital Management, Inc.

680 Fifth Avenue

New York, NY 10019

Attention: General Counsel

Fax: (212) 582-5525	 	 

S-2

 

	 	 	 	 	 	 	 
	 	 	SOUTHPAW ASSET MANAGEMENT LP, as Investment Manager, on behalf of
Southpaw Credit Opportunity Master Fund LP and GPC 76, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Kevin Wyman	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Kevin Wyman	 	 
	 

	 	 	 	Title: Managing Member of General
Partner —           Southpaw
Holdings LLC	 	 
	 
	 	 	 	 	 	 
	 	 	Address:

Southpaw Asset Management LP

4 Greenwich Office Park, 1st Floor

Greenwich, CT 06831

Attention: Arif Y. Gangat

Fax: (203) 862-6201	 	 

S-3

 

	 	 	 	 	 	 	 
	 	 	UBS SECURITIES LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Mark Lane	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Mark Lane	 	 
	 

	 	 	 	Title: Managing Director	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Thomas A. Tormey	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Thomas A. Tormey	 	 
	 

	 	 	 	Title: Director	 	 
	 
	 	 	 	 	 	 
	 	 	Address:

677 Washington Boulevard

Stamford, CT 06901

Attention: Thomas A. Tormey

Fax: (203) 719-0207

W/ Copy To:

Fixed Income Legal

Fax: (203) 719-0680	 	 

S-4EX-4.2

 

Exhibit 4.2

REGISTRATION RIGHTS AGREEMENT

     THIS REGISTRATION RIGHTS AGREEMENT is entered into as of February 28, 2008 by and between
Solutia Inc., a Delaware corporation (the “Company”), and Monsanto Company, a Delaware corporation
(“Monsanto”).

RECITALS

     The Company will issue to Monsanto shares of Common Stock (as defined below) pursuant to the
Solutia Inc. Fifth Amended Joint Plan of Reorganization (which was confirmed by the by the United
States Bankruptcy Court for the Southern District of New York on November 29, 2007 (as modified by
the confirmation order, the “Plan”).

     NOW, THEREFORE, in consideration of the foregoing and of the mutual promises herein contained,
the parties hereby agree as follows:

AGREEMENT

     1. Definitions. Unless the context otherwise requires, the terms defined in this
Section 1 shall have the meanings herein specified for all purposes of this Agreement, applicable
to both the singular and plural forms of any of the terms herein defined.

     “Agreement” means this Registration Rights Agreement.

     “Automatic Shelf Registration Statement” means an automatic shelf registration statement as
defined under Rule 405 of the Securities Act.

     “Board” means the Board of Directors of the Company.

     “Commission” means the Securities and Exchange Commission.

     “Common Stock” means the common stock, par value $.01, of the Company.

     “Exchange Act” means the Securities Exchange Act of 1934, as amended.

     “Free Writing Prospectus” means a free writing prospectus, as defined in Rule 405 under the
Securities Act.

     “Holder” means Monsanto or any record or beneficial owner of Registrable Securities who became
a party to this Agreement in accordance with Section 12 hereof.

     “Holders of a Majority of Registrable Securities” means the Person or Persons who are the
Holders of greater than 50% of the Registrable Securities then outstanding.

     “Initiating Holder” means any Holder of Registrable Securities requesting registration
pursuant to and in accordance with this Agreement. .

     “NASD” means the National Association of Securities Dealers, Inc.

 

 

     “Person” means any natural person, corporation, trust, association, company, partnership,
limited liability company, joint venture and other entity and any government, governmental agency,
instrumentality or political subdivision.

     The terms “register,” “registered” and “registration” refer to a registration effected by
preparing and filing a registration statement in compliance with the Securities Act, and the
declaration or ordering of the effectiveness of such registration statement.

     “Registration Date” means the earlier of (i) the date upon which the Company first files on a
Form 10-K or Form 10-Q as promulgated under the Exchange Act, or any amendment to such a Form 10-K
or Form 10-Q, financial statements that include a balance sheet for a date and income statements
for a period for which the Company has adopted fresh-start accounting in accordance with SOP 90-7
and (ii) the 135th day following the Effective Date (as defined in the Plan).

     “Registrable Securities” means (i) the shares of Common Stock issued or to be issued to
Monsanto, and (ii) any shares of Common Stock or other securities issued or issuable in respect of
the Common Stock or the other securities referred to in clause (i) above by way of a spin-off,
split-off, dividend, stock split or other distribution or in connection with a combination of
shares, reclassification, merger, consolidation, reorganization or similar transaction; provided,
however, that such shares of Common Stock or other securities shall constitute Registrable
Securities only so long as (x) they have not been sold by a Holder to or through a broker or dealer
or underwriter in a public distribution or a public securities transaction pursuant to an effective
registration statement under the Securities Act, (y) they have not been sold by a Holder in a
transaction exempt from the registration and prospectus delivery requirements of the Securities Act
under Section 4(1) thereof so that all transfer restrictions and restrictive legends with respect
to such Common Stock or other securities are removed upon the consummation of such sale and the
seller and purchaser of such Common Stock or other securities receive an opinion of counsel for the
Company, which shall be in form and content reasonably satisfactory to the seller and purchaser and
their respective counsel, to the effect that such Common Stock or other securities in the hands of
the purchaser are freely transferable without restriction or registration under the Securities Act
in any public or private transaction, or (z) they are not capable of being sold by the holder
thereof under Rule 144 (without giving effect to subsection (k) of Rule 144) in a single
transaction.

     “Rule 144” means Rule 144 as promulgated under the Securities Act.

     “Securities Act” means the Securities Act of 1933, as amended.

     “WKSI” means a well-known seasoned issuer as defined under Rule 405 of the Securities Act.

     2. Demand Registration.

          (a) Following the Registration Date, Holders of a Majority of Registrable Securities shall
have the right to request, by delivery of a written notice to the Company (a “Demand Notice”), that
the Company file a registration statement under the Securities Act (a “Demand Registration
Statement”) covering all or a portion of the Registrable Securities for

2

 

the purpose of effecting an offering of such Registrable Securities, whether underwritten or
otherwise (a “Demand Registration”); provided, however, that no Initiating Holder shall be entitled
to demand a Demand Registration Statement during the period when the Company is exercising its
right to defer a Demand Registration pursuant to Section 2(b). Any such Demand Notice must request
the registration of Registrable Securities having an aggregate market value, based on the average
per share closing price of the Common Stock as reported on the principal exchange or market on
which it is then traded over the ten (10) consecutive trading days prior to the date of the Demand
Notice, of not less than twenty-five million dollars ($25,000,000), or, if the registration
statement will be on Form S-3, not less than ten million dollars ($10,000,000). Subject to Section
6(b)(i), as soon as reasonably practicable, but in no event later than sixty (60) days (or thirty
(30) days if the registration statement will be a shelf registration statement on Form S-3) after
receiving a Demand Notice, the Company shall file with the Commission a registration statement
covering the Registrable Securities subject to the Demand Notice. Subject to Sections 2(b) and 4,
the Company shall use its reasonable best efforts to cause such registration statement to become
effective as expeditiously as possible. Any registration under this Section 2 shall reflect such
plan or method of distribution of the applicable securities as shall be designated by the
Initiating Holder.

          (b) Notwithstanding the provisions of Section 2(a), if the Company shall furnish to the
Initiating Holder a certificate signed by the President and Chief Executive Officer of the Company
stating that such officer has made a good faith determination that a registration would (i) require
the disclosure of material nonpublic information concerning the Company, its business or prospects
and that such premature disclosure would be materially adverse to the Company, and/or (ii)
materially interfere with a pending transaction involving the Company or a subsidiary or affiliate
of the Company, then the Company shall have the right to defer such filing or the effectiveness
hereunder for a period ending not more than ninety (90) days after the Company’s receipt of the
applicable Demand Notice, provided, that the Company may not exercise its right under this Section
2(b) more than twice in any 24-month period; and provided further, that the Company may not
exercise its rights under this Section 2(b) for two consecutive 90-day periods.

          (c) Notwithstanding the provisions of Section 2(a), the Company shall not be obligated to (i)
file or effect a Demand Registration Statement for an underwritten offering of Registrable
Securities (an “Underwritten Demand Registration Statement”) within a period of 90 days after the
effective date of any other Underwritten Demand Registration Statement or an underwritten offering
pursuant to a Shelf Demand Registration Statement (as defined below) or (ii) file or effect more
than a total of two Underwritten Demand Registration Statements within any 12-month period;
provided, however, that each Shelf Demand Registration Statement filed during the applicable
12-month period will reduce by one the number of Underwritten Demand Registration Statements the
Company is obligated to file during such 12-month period.

          (d) The Company may elect to register in any underwritten Demand Registration (an
“Underwritten Demand Registration”) any additional shares of Common Stock (including, without
limitation, any shares of Common Stock to be distributed in a primary offering made by the Company)
so long as the inclusion of such Common Stock by the Company would not (as determined in the
Initiating Holder’s reasonable discretion), (i) be reasonably likely to delay in any material
respect the Initiating Holder’s ability timely to sell the Registrable

3

 

Securities pursuant to the Underwritten Demand Registration Statement or (ii) cause a
reduction in the number of Registrable Securities included in the Underwritten Demand Registration
as a result of the Company’s election to so register additional shares of Common Stock. Such
election of the Company, if made, shall be made by the Company giving written notice to the
Initiating Holder prior to the effectiveness of the Underwritten Demand Registration Statement
stating (A) that the Company proposes to include additional shares of Common Stock in such
Underwritten Demand Registration Statement, and (B) the number of shares of Common Stock proposed
to be included.

     3. Shelf Registration.

          (a) Following the Registration Date, any Initiating Holder shall have the right to request, by
delivery of a written notice to the Company (a “Shelf Demand Notice”), that (i) the Company file a
shelf registration statement (a “Shelf Registration Statement”) pursuant to Rule 415 under the
Securities Act covering all or a portion of the Registrable Securities to enable the resale on a
delayed or continuous basis of such Registrable Securities (a “Shelf Demand Registration”) or (ii)
if the Company is a WKSI and has an outstanding effective Form S-3 Registration Statement, the
Company file a post-effective amendment to such Form S-3 Registration Statement covering all or a
portion of the Registrable Securities; provided, however, that no Initiating Holder shall be
entitled to demand a Shelf Registration Statement during the period when the Company is exercising
its right to defer a Demand Registration pursuant to Section 2(b). Subject to Section 6(b)(i), as
soon as reasonably practicable, but in no event later than forty-five (45) days after receiving a
Shelf Demand Notice (or fifteen (15) days if the Company is a WKSI and then has an effective Form
S-3 Registration Statement), the Company shall file with the Commission a Shelf Registration
Statement on Form S-3 of the Commission or, if the Company is a WKSI and has an effective Form S-3
Registration Statement, a post-effective amendment thereto. Subject to Sections 3(b) and 3(c), the
Company shall use its commercially reasonable best efforts to cause the Shelf Registration
Statement to become effective as expeditiously as possible and to remain effective until the
earlier of (x) the time all Registrable Securities subject thereto have been sold and (y) the
fourth anniversary of the initial effective time, including by filing necessary post-effective
amendments and prospectus supplements reasonably required by a Holder, subject to any blackout
periods described in subparagraph (b) below. The Initiating Holder shall have the right to
determine the plan and method of distribution for the Registrable Securities to be reflected in the
Shelf Registration Statement in respect of which it is the Initiating Holder. Notwithstanding
anything contained herein to the contrary, the Holders of Registrable Securities may not file, or
request that the Company file, as required by Rule 424 of the Securities Act, more than three (3)
prospectuses or prospectus supplements in connection with any Shelf Registration Statement in any
thirty (30) day period.

          (b) Notwithstanding the provisions of Section 3(a), if the Company is required to effect a
Shelf Registration Statement or make any filing with the Commission pursuant to this Section 3 or
if the Company has a Shelf Registration Statement in effect pursuant to this Section 3, and the
Company furnishes to the Initiating Holder requesting such registration or filing or to the Holders
of Registrable Securities included in such Shelf Registration Statement, as applicable, a
certificate signed by the President and Chief Executive Officer of the Company stating that such
officer has made a good faith determination that a registration would (i) require

4

 

the disclosure of material nonpublic information concerning the Company, its business or
prospects and that such disclosure would be materially adverse to the Company, and/or (ii)
materially interfere with a pending transaction involving the Company or a subsidiary or affiliate
of the Company, then, the Company shall have the right to defer such filing or the effectiveness
thereof for a period of not more than sixty (60) days after the Company’s receipt of the applicable
Shelf Demand Notice or prevent Holders of Registrable Securities from selling Registrable
Securities pursuant to an effective Shelf Registration Statement for a period of not more than
sixty (60) days after the Company delivers such certificate to the applicable Holder and demands
that such Holder cease sales of securities under the Shelf Registration Statement (and during such
period the Company shall not be obligated to file another Shelf Registration Statement during the
period such sales under an effective Shelf Registration Statement are not allowed); provided, that
the Company may not exercise its rights under this Section 3(b) more than four times in any
consecutive 12-month period; and provided further, that the Company may not defer such filing or
the effectiveness thereof under this Section 3(b) for more than 60 days in aggregate during any
consecutive 12-month period.

          (c) Notwithstanding the provisions of Section 3(a), the Company shall not be obligated to file
a Shelf Registration Statement within a period of ninety (90) days after the effective date of any
Underwritten Demand Registration Statement or an underwritten offering pursuant to a Shelf
Registration Statement or (ii) file or effect more than a total of three (3) Shelf Registration
Statements within any 12-month period; provided, however, that each filing of an Underwritten
Demand Registration Statement during the 12-month period will reduce by one the number of Shelf
Registration Statements that the Company is obligated to file during such 12-month period.

          (d) Upon the receipt by the Company of a Shelf Demand Notice given in accordance with and
subject to Section 3(a) hereof, the Company shall give prompt written notice to all Holders of
Registrable Securities (other than the Initiating Holder) that a Shelf Registration Statement
pursuant to this Section 3 is being effected. In the event that any such Holder delivers to the
Company a written request within fifteen (15) days after the delivery of such written notice to the
Holder by the Company, to include in such Shelf Registration Statement Registrable Securities of
the Holder the Company shall include such Registrable Securities in the Shelf Registration
Statement, including by means of a pre-effective or post-effective amendment thereto; provided,
however, that if the inclusion of the Registrable Securities of such Holders in such registration
statement would, in the opinion of the Initiating Holders, be reasonably likely to delay in any
material respect the Initiating Holder’s ability timely to sell the Registrable Securities pursuant
to the Shelf Registration Statement, the Company shall not include such Holders’ Registrable
Securities in the Shelf Registration Statement without the prior written consent of the Initiating
Holder.

          (e) Following the Registration Date, any Initiating Holder shall have the right to request, by
delivery of a written notice to the Company (a “Shelf Underwritten Demand Notice”), that the
Company effect an underwritten offering of all or a portion of the Registrable Securities included
in an existing Shelf Registration Statement. Any such Shelf Underwritten Demand Notice must
request an underwritten offering of Registrable Securities having an aggregate market value, based
on the average per share closing price of the Registrable Securities as reported on the principal
exchange or market on which the Common Stock is then

5

 

traded over the ten (10) consecutive trading days prior to the date of the Shelf Demand
Notice, of not less than twenty-five million dollars ($25,000,000). Subject to Section 6(b)(i), as
soon as reasonably practicable after receiving a Shelf Underwritten Demand Notice, but in no event
later than twenty (20) days after receiving a Shelf Underwritten Demand Notice, the Company shall
file with the Commission such amendments to the applicable Shelf Registration Statements and such
prospectus supplements or other filings as are necessary in connection with the underwritten
offering of the Registrable Securities subject to the Shelf Underwritten Demand Notice, subject to
Sections 3(b) and Section 4. Any prospectus supplement or other filing with the Commission
including a plan or method of distribution of the securities subject to an underwritten offering
pursuant to this Section 3 shall reflect the plan or method of distribution of such securities as
shall be designated by the managing underwriter of the offering.

          (f) The Company may elect to register in any Shelf Registration Statement any additional
shares of Common Stock (including, without limitation, any shares of Common Stock to be distributed
in a primary offering made by the Company) so long as the inclusion of such Common Stock by the
Company would not (as determined in the Initiating Holder’s reasonable discretion), (i) be
reasonably likely to delay in any material respect the Initiating Holder’s ability timely to sell
the Registrable Securities pursuant to the Shelf Registration Statement or (ii) cause a reduction
in the number of Registrable Securities included in the Shelf Demand Registration as a result of
the Company’s election to so register additional shares of Common Stock . Such election of the
Company, if made, shall be made by the Company giving written notice to the Initiating Holder
stating (A) that the Company proposes to include additional shares of Common Stock in such Shelf
Registration Statement, and (B) the number of shares of Common Stock proposed to be included.

     4. Underwritten Offerings.

          (a) The Initiating Holder shall have the right to select the book-running managers and the
co-managers (collectively, the “managing underwriter”) in connection with any underwritten offering
pursuant to Section 2 or Section 3, provided, that the selection of the managing underwriter by the
Initiating Holder shall be subject to the reasonable approval of the Company. In connection with
any underwritten offering, the Company and the Initiating Holder shall enter into an underwriting
agreement with the underwriter or underwriters selected for such underwriting, provided, that such
underwriting agreement is in customary form and provides for customary compensation, expense
reimbursement and indemnification.

          (b) Upon the receipt by the Company of an Underwritten Demand Notice or a Shelf Underwritten
Demand Notice given in accordance with this Agreement, the Company shall give prompt written notice
to all Holders of Registrable Securities (other than the Initiating Holder) that an underwritten
offering pursuant to Section 2 or Section 3, as applicable is being effected. In the event that
any such Holder delivers to the Company, within fifteen (15) days after the delivery of such
written notice to the Holder by the Company, a written request to include in such underwritten
offering any Registrable Securities of the Holder, the Company shall include such Registrable
Securities in the registration statement; provided that the Company need not include in an
underwritten offering pursuant to Section 3 any Registrable Securities that are not then included
in the applicable Shelf Registration Statement (unless the Company is then a WKSI). The right of
any Holder to include Registrable Securities in any underwritten offering

6

 

shall be conditioned upon such Holder’s willingness to enter into an underwriting agreement
with the underwriter or underwriters selected for such offering (in each case, unless otherwise
mutually agreed by such Holder, the Initiating Holders and the Company).

          (c) Notwithstanding the foregoing, if the managing underwriter of an underwritten offering in
connection with any registration pursuant to Section 2 or Section 3 advises the Company and the
Holders of Registrable Securities participating in such offering in writing that in its good faith
judgment the number of Registrable Securities requested to be included in such offering exceeds the
number of Registrable Securities which can be sold in such offering at a price acceptable to the
applicable Initiating Holder, then (i) the number of Registrable Securities so requested to be
included in such offering shall be reduced to that number of shares which in the good faith
judgment of the managing underwriter can be sold in such offering at such price and (ii) this
reduced number of Registrable Securities shall be allocated among all Holders of Registrable
Securities in proportion, as nearly as practicable, to the respective number of shares of
Registrable Securities then held by such Holders.

          (d) Those Registrable Securities which are excluded from an underwriting in connection with
any registration pursuant to Section 2 or Section 3 hereof by reason of the managing underwriter’s
marketing limitation and all other Registrable Securities not originally requested to be so
included shall not be included in such offering and shall be withheld from the market by the
Holders thereof for a period (not to exceed ninety (90) days) which the managing underwriter
reasonably determines is necessary to effect the underwritten offering.

          (e) If the managing underwriter has not limited the number of Registrable Securities to be
included in an underwritten offering pursuant to Section 2 or Section 3, the Company and, subject
to the requirements of Section 8 hereof, the other holders of the Company’s securities may include
securities for its (or their) own account in such registration if the managing underwriter so
agrees and if the number of Registrable Securities which would otherwise have been included in such
offering will not thereby be limited. The Company shall not grant registration rights to any
holders of the Company’s securities that are more favorable to such holders without the prior
written consent of Holders of a Majority of Registrable Securities. Without limiting the foregoing
sentence, in the event that the Company grants or has previously granted registration rights to any
holders of the Company’s securities that are more favorable to such holders (including, without
limitation, in connection with the backstop of the rights offering to creditors contemplated under
the Plan), the Company shall promptly amend this Agreement to provide such more favorable terms to
the Holders of Registrable Securities.

     5. Piggyback Registration.

          (a) Each time the Company shall determine to file a registration statement under the
Securities Act (other than on Form S-4 or Form S-8 or a registration statement on Form S-1 or Form
S-3 covering solely an employee benefit plan) in connection with the proposed offer and sale of any
of its securities of the same class as the Registrable Securities either for its own account or on
behalf of any other security holder (other than a registration pursuant to Section 2 or Section 3),
the Company agrees to give prompt written notice of its determination to all Holders of Registrable
Securities. In the event that any such Holder delivers to the Company, within fifteen (15) days
after the delivery of such written notice to the Holder by the Company, a

7

 

written request to include in such registration statement any Registrable Securities of the
Holder, the Company shall include such Registrable Securities in such registration statement, all
to the extent required to permit the sale or other disposition by the prospective seller or sellers
of the Registrable Securities to be so registered.

          (b) If the registration of which the Company gives written notice pursuant to Section 5(a) is
for a public offering involving an underwriting, the Company shall so advise the Holders as a part
of its written notice. In such event the right of any Holder to registration pursuant to this
Section 5 shall be conditioned upon such Holder’s participation in such underwriting and the
inclusion of such Holder’s Registrable Securities in the underwriting to the extent provided
herein. Holders proposing to distribute their Registrable Securities through such underwriting
agree to enter into (together with the Company and the other Holders distributing their securities
through such underwriting) an underwriting agreement with the underwriter or underwriters selected
for such underwriting by the Company.

          (c) Notwithstanding any other provision of this Section 5, if the managing underwriter of an
underwritten offering in connection with the registration pursuant to this Section 5 advises the
Company and the Holders of the Registrable Securities participating in such registration in writing
that in its good faith judgment the number of Registrable Securities and the other securities
requested to be registered (i) exceeds the number of Registrable Securities and other securities
which can be sold in such offering at a price acceptable to the Company, or (ii) would jeopardize
the success of the offering, then (A) the number of Registrable Securities and other securities
proposed to be included in the offering shall be reduced to that number which in the good faith
judgment of the managing underwriter can be sold in such offering at a price acceptable to the
Company and (B) such reduced number shall be allocated:

	A.	 	If the registration is on behalf of the Company:

	 	a.	 	First, to the Company, such that all securities proposed to be registered by or
on behalf of the Company are included in the registration statement;
	 
	 	b.	 	Next, among all Holders of Registrable Securities in proportion, as nearly as
practicable to the respective number of Registrable Securities held by such Holders at
the time of the filing of the registration statement; and
	 
	 	c.	 	Last, among all other participating holders proposing to register securities
other than Registrable Securities, in the manner determined by the Company.

	B.	 	If the registration is on behalf of holders of Common Stock other than any Holder of
Registrable Securities:

	 	a.	 	First, among all participating holders other than any stockholder participants
in the manner determined by the Company and among all Holders of Registrable Securities
in proportion, as nearly as practicable to the respective number of Registrable
Securities and other shares of Common Stock held by such persons at the time of the
filing of the registration statement; and

8

 

	 	b.	 	Last, to the Company, for such number of shares of Common Stock as may be
included in the registration statement.

          (d) Those Registrable Securities which are excluded from the underwriting by reason of the
managing underwriter’s marketing limitation and all other Registrable Securities not originally
requested to be so included shall not be included in such registration.

     6. Registration Procedures.

          (a) If and whenever the Company is required by the provisions of Section 2 or 3 to effect the
registration of Registrable Securities under the Securities Act, the Company, at its expense and as
expeditiously as possible shall use its reasonable best efforts to effect such registration and so
as to permit the sale of the applicable Registrable Securities in accordance with the intended
method or methods of distribution thereof in conformity with any required time period set forth
therein, and in connection therewith the Company agrees to:

          (i) in accordance with the Securities Act and all applicable rules and regulations
promulgated thereunder, prepare and file with the Commission a registration statement with
respect to such securities and use its reasonable best efforts to cause such registration
statement to become and remain effective for a period of 120 consecutive days (unless the
registration is a Shelf Registration Statement in which case such period shall extend until
the earlier of (x) the time all Registrable Securities subject thereto have been sold and
(y) the fourth anniversary of the initial effectiveness thereof, subject to the Company’s
rights to cause Holders of Registrable Securities to cease sales under an effective Shelf
Registration Statement pursuant to Section 3(b)), and prepare and file with the Commission
such amendments and supplements to such registration statement and the prospectus contained
therein as may be necessary to keep such registration statement effective and such
registration statement and prospectus accurate and complete and to permit the Holders of
Registrable Securities subject to such registration statement to sell such securities;
provided, that the Company shall provide counsel selected by the Holders of a majority of
the Registrable Securities being registered in such registration (“Holders’ Counsel”) with a
reasonable opportunity to participate in the preparation of such registration statement and
each prospectus included therein (and each amendment or supplement thereto) to be filed with
the Commission.

          (ii) if an offering is to be underwritten in whole or in part, enter into a written
underwriting agreement in form and substance reasonably satisfactory to the Company, the
managing underwriter of the offering, the Initiating Holder (in the case of a underwritten
offering pursuant to Section 2 or Section 3) and to Holders of a majority of the Registrable
Securities participating in such offering (in the case of a registration pursuant to Section
3);

          (iii) furnish, at its expense, to the Holders of securities participating in such
registration and to the underwriters of the securities being registered such number of
copies of the registration statement and each amendment and supplement thereto, preliminary
prospectus, final prospectus, prospectus supplement and such other documents as such
underwriters and Holders may reasonably request;

9

 

          (iv) use its reasonable best efforts to register and qualify the securities covered by
such registration statement under such state securities or blue sky laws of such
jurisdictions as such participating Holders of Registrable Securities and underwriters may
reasonably request, except that the Company shall not for any purpose be required to execute
a general consent to service of process or to qualify to do business as a foreign
corporation in any jurisdiction where it is not so qualified;

          (v) notify the Holders of Registrable Securities participating in such registration,
promptly after it shall receive notice thereof, of the date and time when (i) such
registration statement and each post-effective amendment thereto has become effective or a
prospectus or supplement to any prospectus relating to a registration statement has been
filed and (ii) any registration or qualification has become effective under a state
securities or blue sky law or any exemption thereunder has been obtained;

          (vi) notify such Holders of Registrable Securities promptly of any request by the
Commission for the amending or supplementing of such registration statement or prospectus or
for additional information;

          (vii) notify such Holders of Registrable Securities promptly upon learning of the
occurrence of any event as the result of which any such prospectus or any other prospectus
as then in effect would include an untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements therein not
misleading;

          (viii) prepare and file promptly with the Commission, and notify such Holders of
Registrable Securities prior to the filing of, such amendments or supplements to such
registration statement or prospectus as may be necessary to correct any statements or
omissions if, at the time when a prospectus relating to such securities is required to be
delivered under the Securities Act, when any event has occurred as the result of which any
such prospectus or any other prospectus as then in effect would include an untrue statement
of a material fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein not misleading;

          (ix) in case any of such Holders of Registrable Securities or any underwriter for any
such Holders is required to deliver a prospectus at a time when the prospectus then in
circulation is not in compliance with the Securities Act or the rules and regulations
promulgated thereunder, the Company shall use reasonable best efforts to prepare promptly
upon request such amendments or supplements to such registration statement and such
prospectus as may be necessary in order for such prospectus to comply with the requirements
of the Securities Act and such rules and regulations;

          (x) advise such Holders of Registrable Securities and Holders’ Counsel (if any),
promptly after it shall receive notice or obtain knowledge thereof, of the issuance of any
stop order by the Commission suspending the effectiveness of such registration statement or
the initiation or threatening of any proceeding for that purpose and promptly use its
reasonable best efforts to prevent the issuance of any stop order or to obtain its
withdrawal if such stop order should be issued;

10

 

          (xi) at the request of any Holder of Registrable Securities covered by such
registration statement, (i) furnish to such Holder on the effective date of the registration
statement, upon the filing of a prospectus supplement with respect to such registration
statement or, if such registration includes an underwritten offering, at the closing
provided for in the underwriting agreement, an opinion dated such date of the counsel
representing the Company for the purposes of such registration, addressed to the
underwriters, if any, and to the Holder or Holders making such request, covering such
matters with respect to the registration statement, the prospectus and each amendment or
supplement thereto, proceedings under state, federal and other securities laws, other
matters relating to the Company, the securities being registered and the offer and sale of
such securities as are customarily the subject of opinions of issuer’s counsel provided to
underwriters in underwritten public offerings, and such opinion of counsel shall
additionally cover such legal matters with respect to the registration as such requesting
Holder or Holders may reasonably request, and (ii) use its reasonable best efforts to
furnish to such Holders letters dated each of such effective date, the date of the filing of
a prospectus supplement and such closing date, from the independent certified public
accountants of the Company, addressed to the underwriters, if any, and to the Holder or
Holders making such request, stating that they are independent certified public accountants
within the meaning of the Securities Act and dealing with such customary matters as the
underwriters may request, or if the offering is not underwritten that in the opinion of such
accountants the financial statements and other financial data of the Company included in the
registration statement or the prospectus or any amendment or supplement thereto comply in
all material respects with the applicable accounting requirements of the Securities Act, and
additionally covering such other accounting and financial matters as such requesting Holder
or Holders may reasonably request;

          (xii) list the Registrable Securities (and to maintain such listing during the pendency
of the relevant registration period) on any exchange on which the securities of the Company
of the same class with Registrable Securities are listed;

          (xiii) make available for inspection by any Holder of Registrable Securities covered by
the registration statement, any managing underwriter participating in any disposition
pursuant to such registration statement, Holders’ Counsel (if any) and any attorney,
accountant or other agent retained by any such Holder or any managing underwriter (each, an
“Inspector” and collectively, the “Inspectors”), during regular business hours and upon
reasonable advance notice, all financial and other records, pertinent corporate documents
and properties of the Company (collectively, the “Records”) as shall be reasonably necessary
to enable them to exercise their due diligence responsibility, and cause the Company’s
officers, directors and employees, and the independent public accountants of the Company, to
supply all information reasonably requested by any such Inspector in connection with such
registration statement, subject to obligations of confidentiality;

          (xiv) no more than once in any 120 day period, make senior executives of the Company
available, upon reasonable prior notice and subject to reasonable scheduling flexibility, to
assist the underwriters with respect to, and to accompany the underwriters on the so-called
“road show” in connection with, marketing efforts for the

11

 

distribution and sale of Registrable Securities pursuant to an underwritten offering so
long as the fulfillment of this Section 6(a)(xiv) shall not materially impair such senior
executives’ management of the Company and other activities on behalf of the Company and so
long as any related expenses (including, without limitation, expenses of the Company and
participating senior executives) not required to be paid by the Company pursuant to Section
7(b) are paid by the Holders requesting such “road show” participation and assistance; and

          (xv) prepare other offering materials in a form customarily used in similar
transactions or on the request of any Holder of Registrable Securities or any managing
underwriter.

          (b) Each Holder of Registrable Securities included for registration agrees to:

          (i) provide the Company with such information and assistance as reasonably requested by
the Company to effect such registration under the Securities Act;

          (ii) keep confidential that the Company has exercised its rights under Sections 2(b),
3(b) and any other confidential information provided by the Company in connection with this
Agreement; and

          (iii) comply, with the prospectus delivery requirements and other provisions of the
Securities Act and the Exchange Act and the respective rules and regulations promulgated
thereunder, particularly Regulation M thereunder (or any successor rules or regulations), in
connection with any offering of Registrable Securities.

          (c) Certain legal consequences arise from being named as a selling securityholder in a
registration statement and related prospectus. Accordingly, each Holder of Registrable Securities
acknowledges that it has been advised to consult its own independent securities law counsel
regarding the consequences of demanding or requesting registration of Registrable Securities
hereunder or being named or not being named as a selling securityholder in the registration
statement and related prospectus.

     7. Expenses.

          (a) With respect to each inclusion of shares of Registrable Securities in a registration
statement pursuant to Section 2 or Section 3, the Company agrees to bear all fees, costs and
expenses of such registration and any public offerings in connection therewith (including without
limitation the documented fees and expenses of Holder’s Counsel, if any, fees and disbursements of
all independent registered public accountants referred to in Section 6(a)(xi)(ii), including
expenses of any special audit and “comfort” letters required by or incident to such performance,
and all registration and qualification fees and printing expenses); provided, however, that
Holders of Registrable Securities participating in any such registration agree to bear their pro
rata share of the underwriting discount and commissions, and any expenses associated or incurred in
connection with the “road show” or other marketing efforts, the expenses of which are not required
to be paid by the Company pursuant to subparagraph (b) below shall be paid by the Holders of
Registrable Securities requesting the same.

12

 

          (b) The fees, costs and expenses of registration to be borne as provided in paragraph (a)
above, shall consist of (i) all registration, filing and NASD fees, printing expenses, fees and
disbursements of counsel and accountants for the Company, (ii) all legal fees and disbursements and
other expenses of the Company complying with state securities or blue sky laws of any jurisdictions
in which the securities to be offered are to be registered or qualified and (iii) the company’s
expenses associated with the “road show” or other marketing efforts for the distribution and sale
of Registrable Securities registered under two underwritten registration statements filed pursuant
to either Section 2 or 3.

          (c) Notwithstanding the foregoing, the Company shall pay the expenses of a registration
statement requested pursuant to Section 2 or Section 3 only with respect to the first five (5)
registration statements so filed (and then only to the extent provided for in this Section 7) and
all expenses related to any additional registration statements, including those fees and expenses
set forth in Section 7(b), shall be paid by the Initiating Holder and/or the Holders of Registrable
Securities on a pro rata basis; provided that, in the event that a registration pursuant to Section
2 or 3 is requested by an Initiating Holder and such request is withdrawn prior to the filing of a
registration statement by the Company, or the Holders of Registrable Securities cause the Company
to withdraw a registration statement prior to its effectiveness, then either (at the election of
the Initiating Holder), (i) the Initiating Holder and other Holders of Registrable Securities
requesting inclusion of their shares in such registration shall bear pro rata all fees, costs and
expenses of the registration and preparation of the registration statement and such requested
registration statement shall not be deemed to be one of the registration statements for which the
Company is required to pay expenses pursuant to this Section 7, or (ii) such requested registration
statement shall be deemed to be one of the registration statements for which the Company is
required to pay the expenses pursuant to this Section 7; provided, further, that if at the time of
such withdrawal, the Holders have learned of a material adverse change in the condition, business,
or prospects of the Company as of the date of their request for such registration statement not
known to the Initiating Holder or publicly available at the time of its request and have withdrawn
their request solely on such basis and with reasonable promptness after learning of such material
adverse change, then the Holders shall not be required to pay any of such expenses and such
requested registration statement shall not be deemed to be one of the registration statements for
which the Company is required to pay expenses pursuant to this Section 7.

     8. Indemnification.

          (a) The Company hereby agrees to indemnify and hold harmless each Holder of Registrable
Securities which are included in a registration statement pursuant to the provisions of this
Agreement and each of such Holder’s officers, directors, partners, members, legal counsel and
accountants, and each Person who controls such Holder within the meaning of the Securities Act and
any underwriter (as defined in the Securities Act) for such Holder, and any Person who controls
such underwriter within the meaning of the Securities Act, from and against, and agrees to
reimburse such Holder, its officers, directors, partners, members, legal counsel, accountants and
controlling Persons and each such underwriter and controlling Person of such underwriter with
respect to, any and all claims, actions (actual or threatened), demands, losses, damages,
liabilities, costs and expenses to which such Holder, its officers, directors, partners, members,
legal counsel, accountants or controlling Persons, or any such underwriter or controlling Person

13

 

of such underwriter who may become subject under the Securities Act or otherwise, insofar as
such claims, actions, demands, losses, damages, liabilities, costs or expenses arise out of or are
based upon (i) any untrue statement or alleged untrue statement of any material fact contained in
such registration statement, any prospectus related thereto, or any amendment or supplement
thereto, (ii) the omission or alleged omission to state therein a material fact necessary to make
the statements therein, in light of the circumstances under which they were made, not misleading or
(iii) any violation or alleged violation by the Company of the Securities Act, the Exchange Act,
any federal or state securities law or any rule or regulation promulgated under the Securities Act,
the Exchange Act or any federal or state securities law in connection with the offering covered by
such registration statement; provided, however, that the Company will not be liable to any such
Person to the extent that any such claim, action, demand, loss, damage, liability, cost or expense
is caused by an untrue statement or alleged untrue statement or omission or alleged omission of
material fact so made in strict conformity with written information furnished by such Holder, such
underwriter or such controlling Person specifically for use in the preparation thereof.

          (b) Each Holder of shares of Registrable Securities which are included in a registration
statement pursuant to the provisions of this Agreement hereby agrees (severally and not jointly) to
indemnify and hold harmless the Company, its officers, directors, legal counsel and accountants and
each Person who controls the Company within the meaning of the Securities Act, from and against,
and agrees to reimburse the Company, its officers, directors, legal counsel, accountants and
controlling Persons with respect to, any and all claims, actions, demands, losses, damages,
liabilities, costs or expenses to which the Company, its officers, directors, legal counsel,
accountants or such controlling Persons may become subject under the Securities Act or otherwise,
insofar as such claims, actions, demands, losses, damages, liabilities, costs or expenses are
caused by any untrue or alleged untrue statement of any material fact contained in such
registration statement, any prospectus related thereto or any amendment or supplement thereto, or
are caused by the omission or the alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in light of the circumstances in which
they were made, not misleading, in each case to the extent, but only to the extent, that such
untrue statement or alleged untrue statement or omission or alleged omission was so made in
reliance upon and in strict conformity with written information furnished by such Holder
specifically for use in the preparation thereof and such untrue statement or omission of material
fact was not subsequently corrected in a subsequent writing from such Holder to the Company at
least 36 hours prior to sale of Registrable Securities to the Person asserting the claim or loss;
provided, however, that the indemnity agreement contained in this subsection 8(b) shall not apply
to amounts paid in settlement of any such loss, claim, damage, liability or action if such
settlement is effected without the consent of the Holder, which consent shall not be unreasonably
withheld or delayed; provided, further, that the total amounts payable in indemnity by a Holder
under this subsection 8(b) shall not exceed the net proceeds received by such Holder in the
registered sale out of which such claim, action, demand, loss, damage, liability, cost, or expense
arises.

          (c) Promptly after receipt by a party indemnified pursuant to the provisions of subsection (a)
or (b) of this Section 8 of notice of the commencement of any action involving the subject matter
of the foregoing indemnity provisions, such indemnified party will, if a claim therefore is to be
made against the indemnifying party pursuant to the provisions of subsection

14

 

(a) or (b), notify the indemnifying party of the commencement thereof; but the omission so to
notify the indemnifying party will not relieve it from any liability which it may have to an
indemnified party otherwise than under this Section 8 and shall not relieve the indemnifying party
from liability under this Section 8 unless such indemnifying party is actually and materially
prejudiced by such omission. In case any such action is brought against any indemnified party, and
it notifies the indemnifying party of the commencement thereof, the indemnifying party will be
entitled to participate therein and, to the extent that it may wish, jointly with any other
indemnifying parties similarly notified, to assume the defense thereof, with counsel reasonably
satisfactory to such indemnified party; provided, however, that if the defendants in 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, conflict with or additional to those available to the
indemnifying party, the indemnified party or parties shall have the right to select separate
counsel (in which case the indemnifying party shall not have the right to direct the defense of
such action on behalf of the indemnified party or parties). Upon the permitted assumption by the
indemnifying party of the defense of such action, and approval by the indemnified party of counsel,
the indemnifying party shall not be liable to such indemnified party under subsection (a) or (b)
for any legal or other expenses subsequently incurred by such indemnified party in connection with
the defense thereof (other than reasonable costs of investigation) unless (i) the indemnified party
shall have employed separate counsel in connection with the assertion of legal defenses in
accordance with the proviso to the next preceding sentence, (ii) the indemnifying party shall not
have employed counsel reasonably satisfactory to the indemnified party to represent the indemnified
party within a reasonable time, (iii) the indemnifying party and its counsel do not actively and
vigorously pursue the defense of such action, or (iv) the indemnifying party has authorized the
employment of counsel for the indemnified party at the expense of the indemnifying party. No
indemnifying party shall be liable to an indemnified party for any settlement of any action or
claim without the consent of the indemnifying party and no indemnifying party may unreasonably
withhold its consent to any such settlement. No indemnifying party will consent to entry of any
judgment or enter into any settlement that does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such indemnified party of a release from all liability with
respect to such claim or litigation.

          (d) If the indemnification provided for in subsection (a) or (b) of this Section 8 is held by
a court of competent jurisdiction to be unavailable to a party to be indemnified with respect to
any claims, actions, demands, losses, damages, liabilities, costs or expenses referred to therein,
then each indemnifying party under any such subsection, in lieu of indemnifying such indemnified
party thereunder, hereby agrees to contribute to the amount paid or payable by such indemnified
party as a result of such claims, actions, demands, losses, damages, liabilities, costs or expenses
in such proportion as is appropriate to reflect the relative fault of the indemnifying party on the
one hand and of the indemnified party on the other in connection with the statements or omissions
which resulted in such claims, actions, demands, losses, damages, liabilities, costs or expenses,
as well as any other relevant equitable considerations. The relative fault of the indemnifying
party and of the indemnified party shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or alleged omission to
state a material fact relates to information supplied by the indemnifying party or by the
indemnified party and the parties’ relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. Notwithstanding the foregoing, the

15

 

amount any Holder of Registrable Securities shall be obligated to contribute pursuant to this
subsection (d) shall be limited to an amount equal to the per share sale price (less any
underwriting discount and commissions) multiplied by the number of shares of Registrable Securities
sold by such Holder pursuant to the registration statement which gives rise to such obligation to
contribute (less the aggregate amount of any damages which such Holder has otherwise been required
to pay in respect of such claim, action, demand, loss, damage, liability, cost or expense or any
substantially similar claim, action, demand, loss, damage, liability, cost or expense arising from
the sale of such Registrable Securities).

          (e) No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution hereunder from any person who was not guilty
of such fraudulent misrepresentation.

          (f) The obligations of the Company and Holders under this Section 8 shall survive the
completion of any offering of Registrable Securities in a registration statement and termination of
this Agreement.

     9. Stockholder Information.

     The Company may request each Holder of Registrable Securities as to which any registration is
to be effected pursuant to this Agreement to furnish the Company with such information with respect
to such Holder and the distribution of such Registrable Securities as the Company may from time to
time reasonably request in writing and as shall be required by law or by the Commission in
connection therewith, and each Holder of Registrable Securities as to which any registration is to
be effected pursuant to this Agreement agrees to promptly furnish the Company with such
information.

     10. Forms.

     All references in this Agreement to particular forms of registration statements are intended
to include, and shall be deemed to include, references to all successor forms which are intended to
replace, or to apply to similar transactions as, the forms herein referenced.

     11. Agreements of the Holders of Registrable Securities.

          (a) Each Holder of Registrable Securities agrees in connection with any registration of the
Company’s securities that, upon the request of the managing underwriter of any underwritten
offering of the Company’s securities, it or he or she shall not sell, make any short sale of, loan,
grant any option for the purchase of, or otherwise dispose of any capital stock of the Company
(other than the securities included in such registration) without the prior written consent of such
managing underwriter for a period not to exceed ninety (90) days
) (the “Lock-Up Period”),
provided, however, that each Holder of Registrable Securities also agrees that such Lock-Up Period
may be automatically extended by an additional eighteen (18) days pursuant to the terms of the
agreement entered into with such managing underwriter. The Company may impose stop transfer
instructions with respect to the Registrable Securities subject to the foregoing restriction until
the end of the Lock-Up Period.

16

 

          (b) Each Investor represents that it has not prepared or had prepared on its behalf or used or
referred to, and agrees that it will not prepare or have prepared on it behalf or use or refer to,
any Free Writing Prospectus, and has not distributed and will not distribute any written materials
in connection with the offer or sale of the Common Stock without the prior express written consent
of the Company and, in connection with any underwritten offering, the underwriters.

     12. Transfer of Registration Rights.

     The rights to cause the Company to register securities granted to the Holders of Registrable
Securities pursuant to this Agreement may be transferred or assigned only to (i) an affiliate or
immediate family member of a Holder of Registrable Securities or (ii) an immediate or remote
transferee of the Holder of Registrable Securities who, after such transfer, is the Holder of not
less than 5% of the number of shares of Registrable Securities outstanding as of the date of this
Agreement; provided that the transferee first agrees in writing to be bound by the terms of this
Agreement.

     13. Miscellaneous.

          13.1. Waivers and Amendments.

          (a) With the written consent of the Holders of a Majority of the Registrable Securities, the
obligations of the Company and the rights of the Holders of Registrable Securities under this
Agreement may be waived (either generally or in a particular instance, either retroactively or
prospectively and either for a specified period of time or indefinitely), and with such consent the
Company may enter into a supplementary agreement for the purpose of adding any provisions to or
changing in any manner or eliminating any of the provisions of this Agreement or of any
supplemental agreement or modifying in any manner the rights and obligations hereunder of the
Holders of Registrable Securities and the Company; provided, however, that no such waiver or
supplemental agreement shall reduce the aforesaid proportion of Registrable Securities, the Holders
of which are required to consent to any waiver or supplemental agreement, without the consent of
the Holders of all of the Registrable Securities.

          (b) Upon the effectuation of each such waiver, consent or agreement of amendment or
modification, the Company agrees to give prompt written notice thereof to the Holders of the
Registrable Securities who have not previously consented thereto in writing.

          (c) Neither this Agreement nor any provision hereof may be changed, waived, discharged or
terminated orally or by course of dealing, but only by a statement in writing signed by the party
against which enforcement of the change, waiver, discharge or termination is sought. Specifically,
but without limiting the generality of the foregoing, the failure of any party hereunder at any
time or times to require performance of any provision hereof by the Company shall in no manner
affect the right of such party at a later time to enforce the same. No waiver by any party of the
breach of any term or provision contained in this Agreement, in any one or more instances, shall be
deemed to be, or construed as, a further or continuing waiver of any such breach, or a waiver of
the breach of any other term or covenant contained in this Agreement.

17

 

          13.2. Effect of Waiver or Amendment.

          (a) Each Holder of Registrable Securities acknowledges that by operation of Section 13.1
hereof the Holders of a Majority of the Registrable Securities will, subject to the limitations
contained in Section 13.1, have the right and power to diminish or eliminate certain rights of such
Holder under this Agreement.

          13.3. Rights of Holders of Registrable Securities.

          (a) Each Holder of Registrable Securities shall have the absolute right to exercise or refrain
from exercising any right or rights which such Holder may have by reason of this Agreement or any
Registrable Security, including, without limitation, the right to consent to the waiver of any
obligation of the Company under this Agreement and to enter into an agreement with the Company for
the purpose of modifying this Agreement or any agreement effecting any such modification, and such
Holder shall not incur any liability to any other Holder with respect to exercising or refraining
from exercising any such right or rights.

          13.4. Notices.

          (a) All notices, requests or consents required or permitted under this Agreement shall be made
in writing and shall be given to the other parties by personal delivery, registered or certified
mail (with return receipt), overnight air courier (with receipt signature) or facsimile
transmission (with “answerback” confirmation of transmission), sent to such party’s addresses or
telecopy numbers as follows:

          If to the Company:

Solutia Inc.

575 Maryville Centre Dr.

St. Louis, MO 63141

Attn: General Counsel

          with a copy to:

Kirkland & Ellis LLP

Citicorp Center

153 East 53rd Street

New York, NY 10022

Fax: (212) 446-4900

Attn: Thomas W. Christopher

          Christian O. Nagler

          If to Monsanto:

David Snively, Esq. (General Counsel)

Monsanto Company

800 North Lindbergh Boulevard

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          St. Louis, MO 63167

          with a copy to:

John C. Longmire, Esq.

Willkie Farr & Gallagher LLP

787 Seventh Avenue

New York, NY 10019

Fax: (212) 728-8111

Each such notice, request or consent shall be deemed effective upon the date of actual receipt,
receipt signature or confirmation of transmission, as applicable (or if given by registered or
certified mail, upon the earlier of (i) actual receipt or (ii) three days after deposit thereof in
the United States mail (with respect to addresses within the United States) or ten (10) days after
deposit thereof in the United States mail (with respect to addresses outside of the United States).

          13.5. Severability.

          (a) Should any one or more of the provisions of this Agreement or of any agreement entered
into pursuant to this Agreement be determined to be illegal or unenforceable, all other provisions
of this Agreement and of each other agreement entered into pursuant to this Agreement, shall be
given effect separately from the provision or provisions determined to be illegal or unenforceable
and shall not be affected thereby.

          13.6. No Third Parties.

          (a) Subject to Section 8 hereof, this Agreement shall not run to the benefit of or be
enforceable by any Person other than a party to this Agreement or, with respect to the Company, any
successor thereto.

          13.7. Headings.

          (a) The headings of the sections, subsections and paragraphs of this Agreement have been
inserted for convenience of reference only and do not constitute a part of this Agreement.

          13.8. Choice of Law.

          (a) It is the intention of the parties that the internal substantive laws, and not the laws of
conflicts, of the State of New York should govern the enforceability and validity of this
Agreement, the construction of its terms and the interpretation of the rights and duties of the
parties.

          13.9. Counterparts. This Agreement may be executed in any number of counterparts and
by different parties hereto in separate counterparts, with the same effect as if all parties had
signed the same document. All such counterparts shall be deemed an original, shall be construed
together and shall constitute one and the same instrument.

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          13.10. Reports Under the Exchange Act. In order to provide the Holders the use of
Sections 2 and 3 hereof, and so long as there are Registrable Securities outstanding, the Company
will (i) file in a timely manner (giving effect to any delay permitted by the Securities Act and
the Exchange Act and the rules and regulations promulgated thereunder) the reports required to be
filed by it pursuant to the Securities Act and the Exchange Act and the rules and regulations
promulgated thereunder; (ii) make and keep public information available, as those terms are
understood and defined in the General Instructions to Form S-3, or any successor or substitute
form, and in Rule 144 under the Securities Act, or (iii) will take such further action as any
holder of Registrable Securities may reasonably request, all to the extent required from time to
time to enable such Holder to sell Registrable Securities on Form S-3 (or any successor or
substitute form) or without registration under the Securities Act within the limitation of the
exemptions provided by Rule 144 or Rule 144A under the Securities Act, as such Rule may be amended
from time to time, or any similar rule or regulation hereafter adopted by the Commission. Upon the
request of any holder of Registrable Securities, the Company will deliver to such holder a written
statement as to whether it has complied with such information and requirements and, to the extent
available, with a copy of the most recent annual or quarterly report of the Company, and such other
reports and documents of the Company as a Holder may reasonably request in availing itself of any
rule or regulation of the Commission allowing a Holder to sell securities without registration only
if such report is not available at www.sec.gov or on the Company’s website.

          13.11. Entire Agreement/Effectiveness.

     This Agreement contains the entire understanding of the parties hereto in respect of its
subject matter and supersedes all prior and contemporaneous agreements and understandings, oral and
written, between the parties with respect to such subject matter.

[signature page follows]

20

 

[REGISTRATION RIGHTS AGREEMENT SIGNATURE PAGE]

     IN WITNESS WHEREOF, the parties hereto, intending to be bound by the terms of this agreement,
have caused this Registration Rights Agreement to be executed by its duly authorized officer as of
the date first above written.

	 	 	 	 	 
	 	Solutia Inc.

 	 
	 	By:  	/s/ Rosemary L. Klein
 	 
	 	 	Name:  	Rosemary L. Klein 	 
	 	 	Title:  Senior vice President, General Counsel and
Secretary 
	 
	 
	 	Monsanto Company

 	 
	 	By:  	/s/ David F. Snively
 	 
	 	 	Name:  	David F. Snively 	 
	 	 	Title:  	Sr. V.P., Secretary & General Counsel 	 
	 

S-1

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