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EXHIBIT 10.43
REGISTRATION AGREEMENT
REGISTRATION AGREEMENT dated as of July 30, 1999 between General Dynamics
Corporation, a Delaware corporation (the "Parent Corporation"), and each of the
persons whose names are set forth on the signature page of this Agreement
(referred to in this Agreement individually as a "Stockholder" and collectively
as the "Stockholders").
The Parent Corporation, ▇▇▇▇ Acquisition Corporation, a Delaware
corporation and a wholly-owned subsidiary of the Parent Corporation, and
Gulfstream Aerospace Corporation, a Delaware corporation (the "Company"), are
parties to an Agreement and Plan of Merger dated as of May 16, 1999 (as in
effect as of the date hereof, the "Merger Agreement"). Pursuant to the Merger
Agreement, each of the Stockholders will be issued shares of the Common Stock,
par value $1.00 per share (the "Parent Common Stock"), of the Parent
Corporation.
The Parent Corporation and the Stockholders have entered into this
Agreement for the purpose of evidencing certain agreements among the parties
relating to the grant of registration rights by the Parent Corporation to the
Stockholders.
NOW, THEREFORE, in consideration of the mutual agreements contained herein
and for other good and valuable consideration, the value, receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
SECTION 1. Definitions. For purposes of this Agreement, the following
terms have the meanings set forth below:
"Majority Holders" means the holders of a majority of the Registrable
Securities included in the relevant registration statement at the time the
particular action is taken.
"Person" means an individual, a corporation, a partnership, a limited
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization and a governmental entity or any
department, agency or political subdivision thereof.
"Registrable Securities" means (a) any Parent Common Stock issued to the
Stockholders pursuant to the Merger Agreement and (b) any securities issued or
issuable with respect to the securities referred to in clause (a) by way of a
stock dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization. As to any
particular Registrable Securities, such securities will cease to be Registrable
Securities when they have been distributed to the public pursuant to a offering
registered under the Securities Act or sold to the public in compliance with
Rule 144 under the Securities Act (or any similar rule then in force).
"Registration Expenses" means all expenses incident to the registration and
disposition of the Registrable Securities pursuant to this Agreement, including
all registration, filing and applicable national securities exchange fees, all
fees and expenses of complying with state securities or blue sky laws (including
fees and disbursements of counsel to the underwriters or the Stockholders in
connection with "blue sky" qualification of the Registrable Securities and
determination of their eligibility for investment under the laws of the various
jurisdictions), all word processing, duplicating and printing expenses, all
messenger and delivery expenses, the fees and disbursements of counsel for the
Parent Corporation and of counsel for any other Person reasonably requested by
the Majority Holders, the fees and expenses of the Parent Corporation's
independent public accountants and any other independent public accountants
whose opinions are included in the registration statement, including the
expenses of "cold comfort" letters or any special audits required by, or
incident to, such registration, all fees and disbursements of underwriters
(other than underwriting discounts and
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commissions), all transfer taxes, and the reasonable fees and expenses of
counsel and accountants to the Stockholders; provided that Registration Expenses
will exclude, and the Stockholders will pay, all underwriting discounts and
commissions in respect of the Registrable Securities being registered by such
Stockholders. In connection with any registration pursuant to this Agreement,
the Parent Corporation will not be obligated to pay the fees and expenses for
more than one counsel, other than local and special counsel, or for more than
one firm of accountants representing the Stockholders.
"Securities Act" means the Securities Act of 1933, as amended from time to
time.
"Securities Exchange Act" means the Securities Exchange Act of 1934, as
amended from time to time.
"Shelf Registration Statement" means any registration statement that
provides for the offering of Registrable Securities on a delayed or continuous
basis pursuant to Rule 415 under the Securities Act (or any similar or successor
rule then in force).
Except as otherwise provided herein, all capitalized terms used in this
Agreement will have the respective meanings provided in the Merger Agreement.
SECTION 2. Initial Registration.
2.1 Filing of Initial Registration Statement. On June 18, 1999,
the Parent Corporation filed a registration statement on Form S-3 (the
"Initial Registration Statement") with the Securities and Exchange Commission
relating to the proposed underwritten secondary public offering by the
Stockholders of Registrable Securities (the "Initial Offering"). In accordance
with the provisions of Section 6 of this Agreement, the Parent Corporation will
use its best efforts to cause the Initial Registration Statement to become
effective as of the date of the public release of the combined financial
results of the Parent Corporation and the Company contemplated pursuant to
Section 6.20 of the Merger Agreement (the "Earnings Release"). The Parent
Corporation will use its best efforts to maintain the effectiveness of the
Initial Registration Statement for a period of time, not to exceed 120 days
after the date of the Earnings Release or such longer period as the Parent
Corporation and the Majority Holders may agree (the "Initial Registration
Period"), in order to permit the completion of the Initial Offering in the
manner contemplated by the Initial Registration Statement.
2.2 Postponement of Effectiveness. At any time and from time to time prior
to the effectiveness of the Initial Registration Statement, the Majority Holders
may, by delivery of written notice to the Parent Corporation, request that the
Parent Corporation delay the effectiveness of the Initial Registration Statement
or withdraw the Initial Registration Statement. Thereafter, at any time prior to
the expiration of the Initial Registration Period, the Majority Holders may, by
delivery of written notice to the Parent Corporation, request that the Parent
Corporation use its best efforts to cause the Initial Registration Statement to
become effective as soon as practicable after the date of such notice. Any
Registrable Securities not included in the Initial Registration Statement when
filed will be included in the Initial Registration Statement upon the request of
the holder thereof, such request to be made not later than five days prior to
the effective date of the Initial Registration Statement.
2.3 Registration Expenses. The Parent Corporation will pay all
Registration Expenses incurred in connection with the Initial Registration
Statement and the Initial Offering.
2.4 Prohibited Activities. Until the expiration of the Initial
Registration Period, the Parent Corporation will not effect any public sale or
distribution of its equity securities or any securities convertible into or
exchangeable or exercisable for such securities, or make any filing with the
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Securities and Exchange Commission with respect to such sale or distribution
(including on Form S-4 or any similar or successor form), except pursuant to
registrations on Form S-8 or any similar or successor form. The Parent
Corporation has not entered into, and until the end of the Initial Registration
Period will not enter into, any agreement or transaction (a) which would allow
any Person to request registration of its equity securities or any securities
convertible into or exchangeable or exercisable for such securities prior to the
expiration of the Initial Registration Period or (b) the effect of which would
be to adversely affect the ability of the Initial Registration Statement to be
declared effective on the date of the Earnings Release and through the
expiration of the Initial Registration Period.
SECTION 3. Subsequent Demand Registrations.
3.1 Requests for Demand Registrations. At any time after the expiration of
the Initial Registration Period, the holders of at least 40 percent of the
Registrable Securities will have the right to require the Parent Corporation to
effect, and the Parent Corporation will be required to use its best efforts to
effect, two, or if the Initial Registration Statement has not become effective,
three, registrations under the Securities Act (the "Demand Registrations") of
all or part of their Registrable Securities. Each Demand Registration will be on
Form S-2 or S-3 or any similar or successor short-form registration, if
available, or if such forms are not available to effect a Demand Registration,
such other form of the Securities and Exchange Commission as is available. If
requested by the Majority Holders, and the Parent Corporation is then eligible
to use such a registration, the Demand Registration will be made on a Shelf
Registration Statement. Each request for a Demand Registration will specify the
approximate number of Registrable Securities requested to be registered and the
anticipated per share price range for such offering. Within five business days
after receipt of any such request, the Parent Corporation will give written
notice of such requested registration to all other holders of Registrable
Securities and will include in such registration all Registrable Securities with
respect to which the Parent Corporation has received written requests for
inclusion therein no later than five days prior to the effective date of the
registration statement.
3.2 Priority on Demand Registrations; Right to Withdraw. The Parent
Corporation will not include in any Demand Registration any securities which are
not Registrable Securities without the prior written consent of the Majority
Holders. If a Demand Registration is an underwritten offering and the managing
underwriters advise the Parent Corporation that in their opinion the number of
Registrable Securities and, if permitted hereunder, other securities requested
to be included in such offering exceeds the number of Registrable Securities and
other securities, if any, which can be sold in an orderly manner in such
offering within a price range acceptable to the Majority Holders, the Parent
Corporation will include in such registration prior to the inclusion of any
securities which are not Registrable Securities the number of Registrable
Securities requested to be included which in the opinion of such underwriters
can be sold in an orderly manner within the acceptable price range of such
offering, pro rata among the respective holders thereof on the basis of the
amount of Registrable Securities owned by each such holder. If, as a result of
the proration provisions set forth in the previous sentence, any holder of
Registrable Securities is not entitled to include all Registrable Securities
previously requested to be included in such registration, such holder may elect
to withdraw such holder's request to include Registrable Securities in such
registration or may reduce the number requested to be included; provided that
such request must be made in writing prior to the execution of the underwriting
agreement.
3.3 Restrictions on Demand Registrations. The Parent Corporation will not
be obligated to effect a Demand Registration within 90 days after the effective
date of the previous Demand Registration. The Parent Corporation may postpone
for up to 90 days the filing or effectiveness of a registration statement for a
Demand Registration, and may terminate the effectiveness of and withdraw for a
period of up to 90 days any Shelf Registration Statement filed pursuant to a
Demand
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Registration, if the Parent Corporation promptly notifies the holders of
Registrable Securities in writing that the Board of Directors of the Parent
Corporation has determined in good faith that effecting such Demand
Registration, or continuing the effectiveness of such registration statement,
would reasonably be expected to have a material adverse effect on any proposal
or plan by the Parent Corporation or any of its Subsidiaries to engage in any
material acquisition of assets, merger, consolidation, tender offer or other
material transaction the public disclosure of which the Board of Directors of
the Parent Corporation has determined in good faith is not in the best interests
of the Parent Corporation and provides an approximation of the anticipated
duration of the postponement. In such event, the requested Demand Registration,
or the Demand Registration pursuant to which the withdrawn registration was
filed, will not count for purposes of the requests for Demand Registrations to
which the Stockholders are entitled under this Agreement. The Parent Corporation
may exercise its rights under this Section 3.3 only one time in any six-month
period and the exercise of one right under this Section 3.3 in any six-month
period will preclude the exercise of any other right under this Section 3.3
during the same six-month period. The Parent Corporation acknowledges that its
rights under this Section 3.3 may not be exercised at any time during the
Initial Registration Period.
3.4 Registration Expenses. All Registration Expenses incurred in
connection with any Demand Registration will be borne by the Parent Corporation.
3.5 Selection of Underwriters. The Majority Holders will have the right to
select the investment bankers and managers to administer each underwritten
Demand Registration. Such investment bankers and managers will be of national
prominence.
3.6 Effective Registration Statement. A registration requested pursuant to
Section 3.1 will not be deemed to have been effected (a) unless a registration
statement with respect thereto has become effective and has been kept
continuously effective for a period of at least 180 days (or such shorter period
terminating when all the Registrable Securities covered by such registration
statement have been sold pursuant thereto), (b) if after it has become
effective, such registration is interfered with by any stop order, injunction or
other order or requirement of the Securities and Exchange Commission or other
governmental agency or court for any reason not attributable to the holders
registering Registrable Securities and has not thereafter become effective or
(c) if the conditions to closing specified in the underwriting agreement, if
any, entered into in connection with such registration are not satisfied or
waived.
3.7 Right to Withdraw. If the managing underwriter of any underwritten
offering advise the holders of Registrable Securities included in such offering
that the Registrable Securities covered by the registration statement cannot be
sold in an orderly manner in such offering within a price range acceptable to
the Majority Holders, then the Majority Holders will have the right to notify
the Parent Corporation in writing that they have determined that the
registration statement be abandoned or withdrawn, in which event the Parent
Corporation will abandon or withdraw such registration statement. In the event
of such abandonment or withdrawal, the Demand Registration pursuant to which the
registration was abandoned or withdrawn will not count for purposes of the
requests for Demand Registrations to which the Stockholders are entitled under
this Agreement.
3.8 Termination of Rights. The right to request Demand Registrations
pursuant to this Section 3 will terminate as of the date the outstanding
Registrable Securities in the aggregate represent less than 0.25 percent of the
issued and outstanding shares of Parent Common Stock.
SECTION 4. Piggyback Registrations.
4.1 Right to Piggyback. Whenever the Parent Corporation proposes to
register any shares of Parent Common Stock under the Securities Act (other than
pursuant to a Demand Registration and other than registrations on Form ▇-▇, ▇▇▇▇
▇-▇ or any similar or successor forms) and the registration form to be used may
be used for the registration of Registrable Securities (a "Piggyback
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Registration"), the Parent Corporation will give prompt written notice to all
holders of Registrable Securities of its intention to effect such a registration
and of such holders' rights under this Section 4 and will include in such
registration all Registrable Securities with respect to which the Parent
Corporation has received written requests for inclusion therein no later than
five days prior to the effective date of the registration statement. Subject to
the provisions of this Section 4, the Parent Corporation will use its best
efforts to effect the registration under the Securities Act of all Registrable
Securities which the Parent Corporation has been so requested to register by the
holders of Registrable Securities. No registration effected under this Section
4.1 will relieve the Parent Corporation of its obligation to effect any
registration upon request under Section 3.1.
4.2 Priority on Primary Registrations. If a Piggyback Registration is an
underwritten primary registration on behalf of the Parent Corporation, and the
managing underwriters advise the Parent Corporation that in their opinion the
number of securities requested to be included in such registration exceeds the
number which can be sold in an orderly manner in such offering within a price
range acceptable to the Parent Corporation, the Parent Corporation will include
in such registration (a) first, the securities the Parent Corporation proposes
to sell, (b) second, the Registrable Securities requested to be included in such
registration, pro rata among the holders of such Registrable Securities on the
basis of the number of shares owned by each such holder, and (c) third, other
securities requested to be included in such registration.
4.3 Priority on Secondary Registrations. If a Piggyback Registration is an
underwritten secondary registration on behalf of holders of the Parent
Corporation's securities, and the managing underwriters advise the Parent
Corporation that in their opinion the number of securities requested to be
included in such registration exceeds the number which can be sold in an orderly
manner in such offering within a price range acceptable to the holders initially
requesting such registration, the Parent Corporation will include in such
registration (a) first, the securities requested to be included therein by the
holders requesting such registration and the Registrable Securities requested to
be included in such registration, pro rata among the holders of such securities
on the basis of the number of shares owned by each such holder, and (b) second,
other securities requested to be included in such registration.
4.4 Piggyback Expenses. All Registration Expenses incurred in connection
with any Piggyback Registration will be borne by the Parent Corporation.
4.5 Selection of Underwriters. If any Piggyback Registration is an
underwritten offering, the selection of investment bankers and managers for the
offering must be approved by the Majority Holders; provided that Registrable
Securities constitute at least 10 percent of the securities to be sold pursuant
to such Piggyback Registration. Such approval will not be unreasonably withheld.
4.6 Right to Withdraw. Any holder of Registrable Securities will have the
right to withdraw its request for inclusion of its Registrable Securities in any
registration statement pursuant to Section 4.1 at any time prior to the
execution of any underwriting agreement with respect thereto by giving written
notice to the Parent Corporation of its request to withdraw. Any such request
for withdrawal will be irrevocable.
SECTION 5. Holdback Agreement of the Parent Corporation. The Parent
Corporation agrees not to effect any public sale or distribution of its equity
securities, or any securities convertible into or exchangeable or exercisable
for such securities, during the seven days prior to and during the 180-day
period beginning on the effective date of any underwritten Demand Registration
or underwritten Piggyback Registration (except as part of such underwritten
registration or pursuant to registrations on Form ▇-▇, ▇▇▇▇ ▇-▇ or any similar
or successor forms), unless the underwriters managing the registered public
offering otherwise agree in writing.
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SECTION 6. Registration Procedures. In connection with the Initial
Registration and whenever the holders of Registrable Securities have otherwise
requested that any Registrable Securities be registered pursuant to this
Agreement, the Parent Corporation will use its best efforts to effect the
registration and the sale of such Registrable Securities in accordance with the
intended method of disposition thereof, and pursuant thereto the Parent
Corporation, except as otherwise provided in this Agreement, will as
expeditiously as possible:
(a) prepare and file with the Securities and Exchange Commission a
registration statement with respect to such Registrable Securities and use
its best efforts to cause such registration statement to become effective;
provided that before filing a registration statement or prospectus or any
amendments or supplements thereto, the Parent Corporation will furnish
copies of all such documents proposed to be filed to the counsel selected
by the Majority Holders (the "Holders' Counsel") and, in an underwritten
offering, to counsel for the underwriters;
(b) prepare and file with the Securities and Exchange Commission such
amendments and supplements to such registration statement and prospectus as
may be necessary to keep such registration statement effective for a period
of not less than 180 days (or, in the case of the Initial Registration
Statement, upon the expiration of the Initial Registration Period) and
comply with the provisions of the Securities Act with respect to the
disposition of all securities covered by such registration statement during
such period in accordance with the intended methods of disposition by the
sellers thereof set forth in such registration statement;
(c) furnish, without charge, to each seller of Registrable Securities
and each underwriter such number of copies of such registration statement,
each amendment and supplement thereto (in each case including all
exhibits), the prospectus included in such registration statement
(including each preliminary prospectus) and such other documents as such
seller or underwriter may reasonably request in order to facilitate the
disposition of the Registrable Securities;
(d) use its best efforts to register or qualify such Registrable
Securities under such other securities or blue sky laws of such
jurisdictions as any seller reasonably requests, keep such registration or
qualification in effect for so long as such registration statement remains
in effect, and do any and all other acts and things which may be reasonably
necessary or advisable to enable such seller to consummate the disposition
in such jurisdictions of the Registrable Securities owned by such seller;
provided that the Parent Corporation will not be required to (i) qualify
generally to do business in any jurisdiction where it would not otherwise
be required to qualify, (ii) subject itself to taxation in any such
jurisdiction or (iii) consent to general service of process in any such
jurisdiction;
(e) promptly notify each seller of such Registrable Securities (i)
when the registration statement covering such Registrable Securities, any
pre-effective amendment, the prospectus or any prospectus supplement
related thereto or post-effective amendment to such registration statement
has been filed, and, with respect to such registration statement or any
post-effective amendment, when the same has become effective, (ii) of any
request by the Securities and Exchange Commission for amendments or
supplements to such registration statement or the prospectus related
thereto or for additional information, (iii) of the issuance by the
Securities and Exchange Commission of any stop order suspending the
effectiveness of such registration statement or the initiation of any
proceedings for that purpose, (iv) of the receipt by the Parent Corporation
of any notification with respect to the suspension of the qualification of
any of the Registrable Securities for sale under the securities or blue sky
laws of any jurisdiction or the initiation of any proceeding for such
purpose and (v), at any time when a prospectus relating thereto is required
to be delivered under the Securities Act, of the discovery or happening of
any event as a result of which the prospectus included in such registration
statement contains an untrue statement of a material fact or omits any fact
required to be stated therein or necessary to
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make the statements therein not misleading, and, at the request of any such
seller, the Parent Corporation will prepare and furnish to each seller of
Registrable Securities a supplement or amendment to such prospectus so
that, as thereafter delivered to the purchasers of such Registrable
Securities, such prospectus will not contain an untrue statement of a
material fact or omit to state any fact required to be stated therein or
necessary to make the statements therein not misleading;
(f) cause all such Registrable Securities to be listed on each
securities exchange on which similar securities issued by the Parent
Corporation are then listed;
(g) enter into such customary agreements (including underwriting
agreements in customary form) in accordance with the provisions of Sections
6.5 and 8.1;
(h) otherwise comply with all applicable rules and regulations of the
Securities and Exchange Commission;
(i) in the event of the issuance of any stop order suspending the
effectiveness of a registration statement, or of any order suspending or
preventing the use of any related prospectus or suspending the
qualification of any common stock included in such registration statement
for sale in any jurisdiction, the Parent Corporation will use its best
efforts promptly to obtain the withdrawal of such order; and
(j) obtain a cold comfort letter from the Parent Corporation's
independent public accountants, and any other accountants whose opinions
are included in such registration statement, in customary form and covering
such matters of the type customarily covered by cold comfort letters as the
Majority Holders reasonably request.
(k) make available to its security holders, as soon as reasonably
practicable, an earnings statement covering the period of at least twelve
months beginning with the first full calendar month after the effective
date of such registration statement, which earnings statement will satisfy
the provisions of Section 11(a) of the Securities Act and Rule 158
promulgated thereunder, and promptly furnish to each seller of Registrable
Securities a copy of any amendment or supplement to such registration
statement or prospectus;
(l) obtain an opinion of the Parent Corporation's and any other
counsel reasonably requested by the Majority Holders in customary form and
covering such matters of the type customarily covered by opinions of
counsel as the Majority Holders reasonably request; provided that such
Registrable Securities constitute at least 10 percent of the securities
covered by such registration statement;
(m) use its best efforts to cause all Registrable Securities covered
by such registration statement to be registered with or approved by such
other federal or state governmental agencies or authorities as may be
necessary in the opinion of counsel to the Parent Corporation and Holders'
Counsel to consummate the disposition of such Registrable Securities;
(n) deliver promptly to Holders' Counsel and each underwriter, if any,
participating in the offering of the Registrable Securities, copies of all
correspondence between the Securities and Exchange Commission and the
Parent Corporation, its counsel or auditors and all memoranda relating to
(and allow the Holders' Counsel and any underwriters counsel to participate
in) discussions with the Securities and Exchange Commission or its staff
with respect to such registration statement; and
(o) make available its employees and personnel and otherwise provide
reasonable assistance to the underwriters (including by participating in
meetings, drafting sessions, due diligence sessions and road shows) in
their marketing of Registrable Securities.
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If any such registration or comparable statement refers to any holder by
name or otherwise as the holder of any securities of the Parent Corporation and
if, in its good faith judgment, such holder is or might be deemed to be a
controlling person of the Parent Corporation, such holder will have the right to
require (i) the insertion therein of language, in form and substance reasonably
satisfactory to such holder and presented to the Parent Corporation in writing,
to the effect that the holding by such holder of such securities is not to be
construed as a recommendation by such holder of the investment quality of the
Parent Corporation's securities covered thereby and that such holding does not
imply that such holder will assist in meeting any future financial requirements
of the Parent Corporation or (ii) in the event that such reference to such
holder by name or otherwise is not required by the Securities Act or any similar
federal statute then in force, the deletion of the reference to such holder;
provided that with respect to this clause (ii) such holder will furnish to the
Parent Corporation an opinion of counsel to such effect, which opinion and
counsel will be reasonably satisfactory to the Parent Corporation.
6.2 Unlegended Certificates. In connection with the offering of any
Registrable Securities registered pursuant to this Agreement, the Parent
Corporation will promptly after the sale of such Registrable Securities (a)
facilitate the timely preparation and delivery to holders and the underwriters,
if any, participating in such offering, of unlegended certificates representing
ownership of such Registrable Securities being sold in such denominations and
registered in such names as requested by such holders or such underwriters and
(b) instruct any transfer agent and registrar of such Registrable Securities to
release any stop transfer orders with respect to any such Registrable
Securities.
6.3 No Required Sale. Nothing in this Agreement will be deemed to create
an independent obligation on the part of any holder of Registrable Securities to
sell any Registrable Securities pursuant to any effective registration
statement.
6.4 Rule 144. The Parent Corporation will take all actions reasonably
necessary to enable holders of Registrable Securities to sell such securities
without registration under the Securities Act within the limitation of the
exemptions provided by Rule 144 or any similar rule or regulation hereafter
adopted by the Securities and Exchange Commission including, without limiting
the generality of the foregoing, filing on a timely basis all reports required
to be filed by the Securities Exchange Act. 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 requirements.
6.5 Underwriting Agreement. If the Initial Offering or any Demand
Registration is an underwritten offering, the Parent Corporation will enter into
a customary underwriters agreement with a managing underwriter or underwriters
which will be reasonably satisfactory in form and substance to the Majority
Holders and will contain such representations and warranties by, and such other
agreements on the part of, the Parent Corporation and such other terms as are
generally prevailing in agreements of that type, including customary provisions
relating to indemnification and contribution. The holders of Registrable
Securities in such offering may, at their option, be parties to such
underwriting agreement and require that any or all of the representations and
warranties by, and other agreements on behalf of, the Parent Corporation to and
for the benefit of the underwriters also be made to and for the benefit of such
holders and that any and all of the conditions precedent to the obligations of
such underwriters be conditions precedent to the obligations of such holders.
SECTION 7. Indemnification.
7.1 Parent Corporation Indemnification. The Parent Corporation agrees to
indemnify, to the fullest extent permitted by law, each holder of Registrable
Securities, its directors, officers, partners (and the partners thereof,
collectively, "Partners"), agents and affiliates and each Person who controls
such holder (within the meaning of the Securities Act) against all losses,
claims, damages, liabilities
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and expenses, joint or several, caused by (a) any untrue or alleged untrue
statement of material fact contained in any registration statement, prospectus,
summary prospectus or preliminary prospectus or any amendment thereof or
supplement thereto, (b) any omission or alleged omission of a material fact
required to be stated therein or necessary to make the statements therein not
misleading or (c) any violation by the Parent Corporation of any federal, state
or common law, rule or regulation applicable to the Parent Corporation or
relating to action required of or inaction by the Parent Corporation in
connection with such registration, except insofar as such loss, claim, damage,
liability or expense arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in such
registration statement, prospectus, summary prospectus, preliminary prospectus,
amendment or supplement which is contained in written information furnished to
the Parent Corporation through an instrument duly executed by or on behalf of
such holder, specifically stating that it is for use in the preparation thereof,
or by such holder's failure to deliver a copy of the registration statement or
prospectus or any amendments or supplements thereto after the Parent Corporation
has furnished such holder with a sufficient number of copies of the same. In
connection with an underwritten offering, the Parent Corporation will indemnify
the underwriters, their officers and directors and each Person who controls such
underwriters (within the meaning of the Securities Act) to the same extent as
provided above with respect to the indemnification of the holders of Registrable
Securities.
7.2 Holder Indemnification. In connection with any registration statement
in which a holder of Registrable Securities is participating, each such holder
will furnish to the Parent Corporation in writing such information and
affidavits as the Parent Corporation reasonably requests for use in connection
with any such registration statement or prospectus and, to the extent permitted
by law, will indemnify the Parent Corporation, its directors and officers and
each Person who controls the Parent Corporation (within the meaning of the
Securities Act) against any losses, claims, damages, liabilities and expenses
resulting from any untrue or alleged untrue statement of material fact contained
in the registration statement, prospectus, summary prospectus or preliminary
prospectus or any amendment thereof or supplement thereto or any omission or
alleged omission of a material fact required to be stated therein or necessary
to make the statements therein not misleading, but only to the extent that such
untrue statement or omission is contained in any information or affidavit so
furnished by such holder through an instrument duly executed by or on behalf of
such holder, specifically stating that it is for use in the preparation thereof,
or resulting from such holder's failure to deliver a copy of the registration
statement or prospectus or any amendments or supplements thereto after the
Parent Corporation has furnished such holder with a sufficient number of copies
of the same; provided that the liability of each indemnifying party will be
limited to the amount of proceeds (net of expenses and underwriting discounts
and commissions) received by such indemnifying party in the offering giving rise
to such liability.
7.3 Resolution of Claims. Any Person entitled to indemnification hereunder
will (a) give prompt written notice to the indemnifying party of any claim with
respect to which it seeks indemnification (provided that the failure of any
indemnified party to give notice as provided herein will not relieve the
indemnifying party of its obligations under the preceding subsections of this
Section 7, except to the extent that the indemnifying party is actually
prejudiced by such failure to give notice, and will not relieve the indemnifying
party from any liability which it may have to the indemnified party otherwise
than under this Section 7) and (b) unless in such indemnified party's reasonable
judgment a conflict of interest between such indemnified and indemnifying
parties may exist with respect to such claim, permit such indemnifying party to
assume the defense of such claim with counsel reasonably satisfactory to the
indemnified party. If such defense is assumed, the indemnifying party will not
be subject to any liability for any settlement made by the indemnified party
without its consent (but such consent will not be unreasonably withheld). An
indemnifying party who is not entitled to, or elects not to, assume the defense
of a claim will not be obligated to
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pay the fees and expenses of more than one counsel, other than local and special
counsel, for all parties indemnified by such indemnifying party with respect to
such claim, unless in the reasonable judgment of any indemnified party a
conflict of interest may exist between such indemnified party and any other of
such indemnified parties with respect to such claim. No indemnifying party will,
without the consent of the indemnified party, consent to entry of any judgment
or enter into any settlement which 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 in respect to such claim or litigation.
7.4 Survival. The indemnification provided for under this Agreement will
remain in full force and effect regardless of any investigation made by or on
behalf of the indemnified party or any director, officer, Partner, agent,
affiliate or controlling Person of such indemnified party and will survive the
transfer of securities.
7.5 Contribution. If the indemnification provided for in this Section 7 is
for any reason held by a court to be unavailable to an indemnified party under
Section 7.1 or 7.2 hereof in respect of any loss, claim, damage, liability and
expenses, or any action in respect thereof, then, in lieu of the amount paid or
payable under Section 7.1 or 7.2 hereof, the indemnified party and the
indemnifying party under Section 7.1 or 7.2 hereof will contribute to the
aggregate losses, claims, damages, liabilities and expenses (including legal or
other expenses reasonably incurred in connection with investigating the same),
(a) in such proportion as is appropriate to reflect the relative fault of the
indemnifying party on the one hand, and the indemnified party on the other,
which resulted in such loss, claim, damage, liability or expense, or action in
respect thereof, with respect to the statements or omissions which resulted in
such loss, claim, damage, liability or expense, or action in respect thereof, as
well as any other relevant equitable considerations, or (b) if the allocation
provided by clause (a) above is not permitted by applicable law, in such
proportion as is appropriate to reflect not only the relative fault but also the
relative benefits received by the indemnifying party and the indemnified party
from the offering of the securities covered by such registration statement as
well as any other relevant equitable considerations. The parties hereto agree
that it would not be just and equitable if contributions pursuant to this
Section 7.5 were to be determined by pro rata allocation or by any other method
of allocation which does not take into account the equitable considerations
referred to in the preceding sentence of this Section 7.5. No Person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) will be entitled to contribution from any Person who was not
guilty of such fraudulent misrepresentation. In addition, no Person will be
obligated to contribute hereunder any amounts in payment for any settlement of
any action or claim effected without such Person's consent, which consent will
not be unreasonably withheld. Notwithstanding anything in this Section 7.5 to
the contrary, no indemnifying party (other than the Parent Corporation) will be
required to contribute any amount in excess of the proceeds (net of expenses and
underwriting discounts and commissions) received by such party from the sale of
the Registrable Securities in the offering to which the losses, claims, damages,
liabilities or expenses of the indemnified parties relate.
7.6 Other Indemnification. Indemnification and contribution similar to
that specified in the preceding subsections of this Section 7 (with appropriate
modifications) will be given by the Parent Corporation and holders of
Registrable Securities participating in a registered offering with respect to
any required registration or other qualification of securities under any
federal, state or blue sky law or regulation of any governmental authority other
than the Securities Act. The indemnification agreements contained in this
Section 7 will be in addition to any other rights to indemnification or
contribution which any indemnified party may have pursuant to law or contract.
7.7 Indemnification Payments. The indemnification and contribution
required by this Section 7 will be made by periodic payments of the amount
thereof during the course of the investigation or defense, as and when bills are
received or expense, loss, damage or liability is incurred.
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SECTION 8. Participation in Registrations.
8.1 Required Actions. No Person may participate in any registration
hereunder which is underwritten unless such Person (a) agrees to sell such
Person's securities on the basis provided in any underwriting arrangements
approved by the Person or Persons entitled hereunder to approve such
arrangements and (b) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents consistent
with the terms of this Agreement; provided that no holder of Registrable
Securities included in any underwritten registration will be required to make
any representations or warranties to the Parent Corporation or the underwriters
other than representations and warranties regarding such holder and such
holder's intended method of distribution and any liability of such holder to any
underwriter or other Person under such underwriting agreement will be limited to
liability arising from breach of its representations and warranties and will be
limited to an amount equal to the proceeds (net of expenses and underwriting
discounts and commissions) that it derives from such registration..
8.2 Preparation; Reasonable Investigation. In connection with the
preparation and filing of each registration statement under the Securities Act
pursuant to this Agreement, the Parent Corporation will give each holder
participating in such registration, its underwriters, if any, and its respective
counsel, accountants and other representatives and agents the opportunity to
participate in the preparation of such registration statement, each prospectus
included therein or filed with the Securities and Exchange Commission, and each
amendment thereof or supplement thereto, and give each of them such reasonable
access to its books and records and such reasonable opportunities to discuss the
business of the Parent Corporation with its officers and employees and the
independent public accountants who have certified its financial statements, and
supply all other information reasonably requested by each of them, as is
necessary or appropriate, in the opinion of each such registering holder and
such underwriters' respective counsel, to conduct a reasonable investigation
within the meaning of the Securities Act.
SECTION 9. Miscellaneous.
9.1 No Inconsistent Agreements. The Parent Corporation has not previously
entered into any agreement with respect to its securities granting any
registration rights to any Person. The rights granted to the Stockholders
hereunder do not in any way conflict with and are not inconsistent with any
other agreements to which the Parent Corporation is a party or by which it is
bound. The Parent Corporation is not a party to and will not hereafter enter
into any agreement with respect to its securities which is inconsistent with or
violates the rights granted to the holders of Registrable Securities in this
Agreement. If the Parent Corporation enters into any other registration rights
agreement after the date of this Agreement with respect to any of its securities
containing terms which are more favorable to, or less restrictive on, the other
party thereto than the terms and conditions contained in this Agreement are to
the Stockholders, then the terms and conditions of this Agreement will
immediately be deemed to have been amended without further action by the Parent
Corporation or the Stockholders so that the Stockholders will be entitled to the
benefit of any such more favorable or less restrictive terms or conditions.
9.2 Remedies. The parties agree that irreparable damage would occur in the
event that the provisions of this Agreement were not performed in accordance
with their specific terms. It is accordingly agreed that the parties will be
entitled to specific performance of the terms of this Agreement, without posting
a bond or other security, this being in addition to any other remedy to which
they are entitled at law or in equity.
9.3 Consent to Amendments. Except as otherwise expressly provided herein,
the provisions of this Agreement may be amended and the Parent Corporation may
take any action herein prohibited, or omit to perform any act herein required to
be performed by it, only if the Parent Corporation has
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obtained the written consent of the holders of a majority of the Registrable
Securities or, if the consent relates to a particular registration statement, by
the Majority Holders. No other course of dealing between the Parent Corporation
and the holder of any Registrable Securities or any delay in exercising any
rights hereunder or under the Certificate of Incorporation will operate as a
waiver of any rights of any such holders. For purposes of this Agreement, shares
of Registrable Securities held by the Parent Corporation or any of its
Subsidiaries will not be deemed to be outstanding.
9.4 Successors and Assigns. Except as otherwise expressly provided herein,
all covenants and agreements contained in this Agreement by or on behalf of any
of the parties hereto will bind and inure to the benefit of the respective
successors and assigns of the parties hereto whether so expressed or not. In
addition, and whether or not any express assignment has been made, the
provisions of this Agreement which are for the Stockholders' benefit as holders
of Registrable Securities are also for the benefit of, and enforceable by, any
subsequent holder of such Registrable Securities, each of which will be deemed a
Stockholder for all purposes under this Agreement.
9.5 Severability. Whenever possible, each provision of this Agreement will
be interpreted in such manner as to be effective and valid under applicable law,
but if any provision of this Agreement is held to be prohibited by or invalid
under applicable law, such provision will be ineffective only to the extent of
such prohibition or invalidity, without invalidating the remainder of this
Agreement.
9.6 Counterparts; Effectiveness. This Agreement may be executed
simultaneously in two or more counterparts, any one of which need not contain
the signatures of more than one party, but all such counterparts taken together
will constitute one and the same Agreement. This Agreement will be effective as
to a holder of Registrable Securities when this Agreement has been executed by
the Parent Corporation and such holder.
9.7 Descriptive Headings. The descriptive headings of this Agreement are
inserted for convenience only and do not constitute a part of this Agreement.
9.8 Notices. All notices, demands or other communications to be given or
delivered under or by reason of the provisions of this Agreement will be in
writing and will be deemed to have been given when delivered personally to the
recipient or when sent to the recipient by telecopy (receipt confirmed), one
business day after the date when sent to the recipient by reputable express
courier service (charges prepaid) or three business days after the date when
mailed to the recipient by certified or registered mail, return receipt
requested and postage prepaid. Such notices, demands and other communications
will be sent to the Parent Corporation and the Stockholders at the addresses
indicated below:
If to the Parent Corporation:
General Dynamics Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Senior Vice President and General Counsel
Facsimile No: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy (which will not constitute notice) to:
Jenner & Block
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Facsimile No: (▇▇▇) ▇▇▇-▇▇▇▇
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If to a Stockholder:
c/o Forstmann Little & Co.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Facsimile No: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy (which will not constitute notice) to:
Fried, Frank, Harris, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, P.C.
▇▇▇▇▇ ▇▇▇▇▇▇▇, Esq.
Facsimile No: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other address or to the attention of such other party as the
recipient party has specified by prior written notice to the sending party.
9.9 No Third-Party Beneficiaries. This Agreement will not confer any
rights or remedies upon any Person other than the Parent Corporation and the
Stockholders and their respective successors and permitted assigns.
9.10 Entire Agreement. This Agreement (including the documents referred to
herein) constitutes the entire agreement among the parties and supersedes any
prior understandings, agreements, or representations by or among the parties,
written or oral, that may have related in any way to the subject matter hereof.
9.11 Construction. The language used in this Agreement will be deemed to
be the language chosen by the parties to express their mutual intent, and no
rule of strict construction will be applied against any party. Any reference to
any federal, state, local, or foreign statute or law will be deemed also to
refer to all rules and regulations promulgated thereunder, unless the context
requires otherwise. The use of the word "including" in this Agreement means
"including without limitation" and is intended by the parties to be by way of
example rather than limitation.
8.12 Consent to Jurisdiction. Each of the parties to this Agreement
submits to the jurisdiction of any state or federal court sitting in Wilmington,
Delaware, in any action or proceeding arising out of or relating to this
Agreement, agrees that all claims in respect of the action or proceeding may be
heard and determined in any such court, and agrees not to bring any action or
proceeding arising out of or relating to this Agreement in any other court. Each
of the parties to this Agreement waives any defense of inconvenient forum to the
maintenance of any action or proceeding so brought and waives any bond, surety
or other security that might be required of any other party with respect
thereto.
8.13 GOVERNING LAW. ALL QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY
AND INTERPRETATION OF THIS AGREEMENT WILL BE GOVERNED BY THE INTERNAL LAW, AND
NOT THE LAW OF CONFLICTS, OF THE STATE OF DELAWARE.
* * * * *
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IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Agreement on the date first written above.
GENERAL DYNAMICS CORPORATION
By
--------------------------------------
Name:
Title:
FORSTMANN LITTLE & CO.
SUBORDINATED DEBT AND EQUITY
MANAGEMENT BUYOUT PARTNERSHIP--IV,
L.P.
By FLC XXIX PARTNERSHIP, L.P.
Its General Partner
By
--------------------------------------
General Partner
GULFSTREAM PARTNERS, L.P.
By FLC XXI PARTNERSHIP
Its General Partner
By
--------------------------------------
General Partner
GULFSTREAM PARTNERS II, L.P.
By FLC XXIV PARTNERSHIP
Its General Partner
By
--------------------------------------
General Partner
--------------------------------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇▇, Stockholder
-------------
--------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Stockholder
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Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Stockholder
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Stockholder
----------------
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Name: ▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, Stockholder
------------------
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Stockholder
-----------------
--------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇, ▇▇., Stockholder
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