Exhibit 10.1
WARRANT AGREEMENT
Dated as of
May 30, 2002
between
QUALITY DISTRIBUTION, INC.
and
THE BANK OF NEW YORK,
as Warrant Agent
Warrants for
Common Stock of
Quality Distribution, Inc.
TABLE OF CONTENTS
Page
Article I....................................................................... 1
1.1 Definitions........................................................... 1
1.2 Rules of Construction................................................. 3
Article II Warrant Certificates................................................. 4
2.1 Form and Dating....................................................... 4
2.2 Execution and Authentication.......................................... 5
2.3 Warrant Registrar..................................................... 5
2.4 Holder Lists.......................................................... 6
2.5 Transfer and Exchange................................................. 6
2.6 Definitive Warrants................................................... 12
2.7 Lost, Stolen, Destroyed, Defaced or Mutilated Warrant Certificate..... 12
2.8 Outstanding Warrants.................................................. 13
2.9 Temporary Warrants.................................................... 13
2.10 Cancellation.......................................................... 13
2.11 CUSIP Numbers......................................................... 13
Article III Warrant Agent....................................................... 14
3.1 Appointment of Warrant Agent.......................................... 14
3.2 Rights and Duties of Warrant Agent.................................... 14
3.3 Individual Rights of Warrant Agent.................................... 15
3.4 Warrant Agent's Disclaimer............................................ 15
3.5 Compensation and Indemnity............................................ 15
3.6 Successor Warrant Agent............................................... 16
Article IV Miscellaneous........................................................ 17
4.1 Reports to Warrant Agent and Holders.................................. 17
4.2 Persons Benefiting.................................................... 17
4.3 Rights of Holders..................................................... 18
4.4 Amendment, Waiver, Modification, Etc.................................. 18
4.5 Notices............................................................... 18
4.6 Governing Law......................................................... 19
4.7 Successors............................................................ 19
4.8 Counterparts.......................................................... 20
4.9 Table of Contents and Headings........................................ 20
4.10 Severability.......................................................... 20
EXHIBIT A Form of Warrant Certificate
WARRANT AGREEMENT dated as of May
30, 2002 (this "Warrant Agreement"), between
QUALITY DISTRIBUTION, INC., a Florida
corporation (the "Corporation"), and THE
BANK OF NEW YORK, a New York banking
corporation, as warrant agent (the "Warrant
Agent").
WHEREAS, the Corporation desires to issue the warrants (the
"Warrants") described herein, which will initially entitle the holders thereof
(the "Holders") to purchase, in the aggregate, up to 171,282 shares of Common
Stock, $.01 par value per share, of the Corporation ("Common Stock");
WHEREAS, the Warrants are being issued in connection with the
exchange offer (the "Exchange Offer") by the Corporation, pursuant to which the
Corporation and Quality Distribution, LLC, a Delaware limited liability company
and a wholly owned subsidiary of the Corporation ("QDI LLC") have agreed to
exchange each $1,000 principal amount of outstanding 10% Series B Senior
Subordinated Notes due 2006 and all outstanding Series B Floating Interest Rate
Subordinated Term Securities due 2006 (FIRSTS(SM)) of the Corporation for debt
and equity securities (the "Debt/Equity Securities");
WHEREAS, each Debt/Equity Security consists of: (i) $650.00
principal amount of new 12-1/2% Senior Subordinated Secured Notes due 2008 (the
"New Notes") to be issued by QDI LLC (ii) $150.00 principal amount of new 12%
Junior Subordinated PIK Notes due 2009 (the "Junior PIK Notes"), to be issued by
the Corporation and (iii) 2.0415 Warrants, each to purchase one share of Common
Stock at an exercise price of $5.00 per share; and
WHEREAS, the Corporation further desires the Warrant Agent to
act on behalf of the Corporation in connection with the issuance, transfer,
exchange and exercise of the Warrants and other matters as provided herein and
the Warrant Agent is willing to so act.
NOW, THEREFORE, each party agrees as follows for the benefit
of the other party and for the equal and ratable benefit of the Holders of the
Warrants:
ARTICLE I
1.1 DEFINITIONS.
"Affiliate" shall mean with respect to any Person, any other
Person directly or indirectly controlling, controlled by, or under common
control with, such Person; for purposes of this definition, "control" shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities or otherwise. The term "Affiliate" shall not
include at any time any portfolio company of Apollo Management IV, L.P. or its
Affiliates.
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"Board of Directors" or "Board" means the board of directors
of the Corporation or any committee thereof duly authorized to act on behalf of
such board.
"Definitive Warrant" means a Warrant Certificate (bearing the
Restricted Warrant Legend if the transfer of such Warrant is restricted by
applicable law) that does not include the Global Warrant Legend.
"Depositary " means The Depository Trust Corporation, its
nominees and their respective successors.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Global Warrant" shall have the meaning set forth in Section
2.1(b).
"Global Warrant Legend" means the legend set forth under that
caption in Exhibit A to this Warrant Agreement.
"Holder" means the Person in whose name a Warrant is
registered on the Warrant Registrar's books.
"IAI" means an institutional "accredited investor" as defined
in Rule 501(a)(1), (2), (3) or (7) under the Securities Act.
"IAI Global Warrants" means all Warrants offered and sold to
IAIs relying upon Rule 501.
"Offering Memorandum" means the Offering Memorandum and
Consent Solicitation Statement dated April 10, 2002, of the Corporation, as
amended by Supplement No. 1 dated May 10, 2002.
"Officer" means the Chairman of the Board of Directors, the
Chief Executive Officer, the Chief Financial Officer, the President, any Vice
President, the Treasurer, the Secretary or any Assistant Secretary of the
Corporation.
"Officers' Certificate" means a certificate signed by two
Officers.
"Opinion of Counsel" means a written opinion from legal
counsel. Such counsel may be an employee of or counsel to the Corporation.
"Person" means any individual, corporation, limited liability
company, partnership, trust, incorporated or unincorporated association, joint
venture, joint stock company, government (or an agency or political subdivision
thereof) or other entity of any kind.
"QIB" means a "qualified institutional buyer" as defined in
Rule 144A.
"Restricted Warrant Legend" means the legend set forth in
Section 2.5(e)(i) herein.
"Rule 501" means Rule 501 under the Securities Act.
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"Rule 144A" and "Rule 144" mean respectively, Rule 144A and
Rule 144 under the Securities Act.
"Rule 144A Warrants" shall have the meaning set forth in
Section 2.1(b).
"SEC" or "Commission" means the Securities and Exchange
Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Transfer Restricted Warrants" means Global Warrants,
Definitive Warrants and any other Warrants that bear or are required to bear the
Restricted Warrant Legend.
"Warrant Agent" means The Bank of New York, or any successor
person to The Bank of New York under this Warrant Agreement.
"Warrant Certificates" mean the registered certificates
(including the Global Warrants) issued by the Corporation under this Warrant
Agreement representing the Warrants.
"Warrant Custodian" means the custodian with respect to a
Global Warrant (as appointed by the Depositary ) or any successor person
thereto, who shall initially be the Warrant Agent.
"Warrant Officer" means any officer within the corporate trust
department of the Warrant Agent, including any vice president, assistant vice
president, assistant secretary, assistant treasurer, trust officer or any other
officer of the Warrant Agent who customarily performs functions similar to those
performed by the Persons who at the time shall be such officers, respectively,
or to whom any corporate trust matter is referred because of such Person's
knowledge of and familiarity with the particular subject and who shall have
direct responsibility for the administration of this Warrant Agreement.
"Warrant Registrar" has the meaning set forth in Section 2.3.
1.2 RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(a) a defined term has the meaning assigned to it;
(b) an accounting term not otherwise defined has the meaning
assigned to it in accordance with generally accepted accounting principles as in
effect from time to time;
(c) "or" is not exclusive;
(d) "including" means including without limitation; and
(e) words in the singular include the plural and words in the
plural include the singular.
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ARTICLE II
WARRANT CERTIFICATES
2.1 FORM AND DATING.
(a) General. Each Warrant shall initially be issued as part of
the Debt/Equity Securities issued on the date hereof, which will be offered and
exchanged by the Corporation in the Exchange Offer pursuant to the Offering
Memorandum. In acting as the transfer agent for the Warrants, the Warrant
Registrar shall be entitled to all the rights, privileges and immunities to
which the Warrant Agent is entitled in performing such role pursuant to the
terms of this Warrant Agreement. The Warrant Certificates shall each be
substantially in the form of EXHIBIT A attached hereto. The terms and provisions
contained in the Warrant Certificate shall constitute, and are expressly
incorporated in and made a part of this Warrant Agreement, and to the extent
applicable, the Corporation and the Warrant Agent, by their execution and
delivery of this Warrant Agreement, expressly agree to such terms and provisions
and are bound thereby. The Warrants may only be sold or transferred in
accordance with this Warrant Agreement and the Warrant Certificates may have
notations, legends or endorsements required by law, stock exchange rule,
agreements to which the Corporation is subject, if any, or usage (provided that
any such notation, legend or endorsement is in a form acceptable to the
Corporation). Each Warrant Certificate shall be dated as of the date of its
authentication.
(b) Global Warrants. IAI Global Warrants shall be issued
initially on the Issue Date in the form of one or more permanent global Warrants
in fully registered form (collectively, the "IAI Global Warrants"), bearing the
Global Warrant Legend and the Restricted Warrant Legend, which shall be
deposited on behalf of the acquirers of the Warrants represented thereby with
the Warrant Custodian, and registered in the name of the Depositary or a nominee
of the Depositary, duly executed by the Corporation and authenticated by the
Warrant Agent as provided in this Warrant Agreement. To accommodate transfers of
beneficial interests in the Warrants to QIB's subsequent to the Issue Date, one
or more global Warrants in definitive, fully registered form bearing the Global
Warrant Legend and the Restricted Warrant Legend (collectively, the "Rule 144A
Global Warrants") shall also be issued on the Closing Date and deposited on
behalf of the acquirers of the Warrants represented thereby with the Warrant
Custodian, and registered in the name of the Depositary or a nominee of the
Depositary, duly executed by the Corporation and authenticated by the Warrant
Agent as provided in this Warrant Agreement. The Rule 144A Global Warrants and
the IAI Global Warrants are each referred to herein as a "Global Warrant" and
are collectively referred to herein as "Global Warrants." The number of Warrants
represented by the Global Warrants may from time to time be increased or
decreased by adjustments made on the records of the Warrant Agent and the
Depositary or its nominee and on the schedules thereto as hereinafter provided.
(c) Book-Entry Provisions. This Section 2.1(c) shall apply
only to a Global Warrant deposited with or on behalf of the Depositary. The
Corporation shall execute and the Warrant Agent shall, in accordance with this
Section 2.1(c) and Section 2.2 and pursuant to an order of the Corporation
signed by two Officers, authenticate and deliver initially one or more Global
Warrants that (i) shall be registered in the name of the Depositary for such
Global Warrant or Global Warrants or the nominee of such Depositary and (ii)
shall be delivered by the Warrant Agent to such Depositary or pursuant to such
Depositary's instructions or held by the Warrant Agent as Warrant Custodian.
Members of, or participants in, the Depositary ("Agent Members") shall have no
rights under this Warrant Agreement with respect to any Global Warrant held on
their behalf by the Depositary or by the Warrant Agent as Warrant Custodian or
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under such Global Warrant, and the Depositary may be treated by the Corporation,
the Warrant Agent and any agent of the Corporation or the Warrant Agent as the
absolute owner of such Global Warrant for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent the Corporation, the
Warrant Agent or any agent of the Corporation or the Warrant Agent from giving
effect to any written certification, proxy or other authorization furnished by
the Depositary or impair, as between the Depositary and its Agent Members, the
operation of customary practices of such Depositary governing the exercise of
the rights of a holder of a beneficial interest in any Global Warrant.
(d) Definitive Warrants. Except as provided in Section 2.5 or
2.6, owners of beneficial interests in a Global Warrant will not be entitled to
receive physical delivery of Warrant Certificates.
2.2 EXECUTION AND AUTHENTICATION.
Two Officers shall sign each Warrant Certificate for the
Corporation by manual or facsimile signature. If an Officer whose signature is
on a Warrant Certificate no longer holds that office at the time the Warrant
Agent authenticates the Warrant Certificate, the Warrant Certificate shall be
valid nevertheless. A Warrant shall not be valid until an authorized signatory
of the Warrant Agent manually signs the certificate of authentication on the
Warrant Certificate. The signature shall be conclusive evidence that the Warrant
has been authenticated under this Warrant Agreement. The Warrant Agent shall
authenticate and make available for delivery upon a written order of the
Corporation, signed by two Officers, Warrant Certificates entitling the Holders
therefor to purchase in the aggregate not more than 171,282 shares of Common
Stock, subject to adjustment, as set forth in the Warrant Certificate. The
Warrant Agent may appoint an authenticating agent reasonably acceptable to the
Corporation to authenticate the Warrants. Any such appointment shall be
evidenced by an instrument signed by a Warrant Officer, a copy of which shall be
furnished to the Corporation. Unless limited by the terms of such appointment,
an authenticating agent may authenticate Warrants whenever the Warrant Agent may
do so. Each reference in this Warrant Agreement to authentication by the Warrant
Agent includes authentication by such authenticating agent. An authenticating
agent has the same rights as any Warrant Registrar or agent for service of
notices and demands.
2.3 WARRANT REGISTRAR.
(a) The Corporation shall maintain an office or agency where
Warrants may be presented for registration of transfer, exchange or exercise
(the "Warrant Registrar"). The Warrant Registrar shall keep a register of the
Warrants and of their transfer, exchange or exercise. The Corporation may have
one or more co-registrars. The term Warrant Registrar includes any
co-registrars. The Corporation shall initially appoint the Warrant Agent as (i)
Warrant Registrar in connection with the Warrants and (ii) the Warrant Custodian
with respect to the Global Warrants.
(b) The Corporation shall enter into an appropriate agency
agreement with any Warrant Registrar who is not a party to this Warrant
Agreement. The agreement shall implement the provisions of this Warrant
Agreement that relate to such agent. The Corporation shall notify the Warrant
Agent of the name and address of any such agent. If the Corporation fails to
maintain a Warrant Registrar, the Warrant Agent shall act as such and shall be
entitled to appropriate compensation pursuant to Section 3.5 hereof. The
Corporation or any of its domestically organized wholly owned subsidiaries may
act as Warrant Registrar.
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(c) The Corporation may remove any Warrant Registrar upon
written notice to such Warrant Registrar and to the Warrant Agent; provided,
however, that no such removal shall become effective until (i) acceptance of an
appointment by a successor as evidenced by an appropriate agreement entered into
by the Corporation and such successor Warrant Registrar and delivered to the
Warrant Agent or (ii) notification to the Warrant Agent that the Warrant Agent
shall serve as Warrant Registrar until the appointment of a successor in
accordance with clause (i) above. The Warrant Registrar may resign at any time
upon written notice to the Corporation and the Warrant Agent; provided, however,
that the Warrant Agent may resign as Warrant Registrar only if the Warrant Agent
also resigns as Warrant Agent in accordance with Section 3.6.
(d) The Corporation and the Warrant Agent may deem and treat
the Person in whose name a Warrant Certificate is registered as the absolute
owner of such Warrant Certificate for all purposes whatsoever and neither the
Corporation nor the Warrant Agent shall be affected by notice to the contrary.
2.4 HOLDER LISTS.
The Warrant Agent shall preserve in as current a form as is
reasonably practicable the most recent list available to it of the names and
addresses of the Holders. If the Warrant Agent is not the Warrant Registrar, the
Corporation shall furnish, or cause the Warrant Registrar to furnish, to the
Warrant Agent, in writing at such times as the Warrant Agent may request in
writing, a list in such form and as of such date as the Warrant Agent may
reasonably require of the names and addresses of Holders.
2.5 TRANSFER AND EXCHANGE.
(a) General. The Warrants shall be issued in registered form
and shall be transferable only upon the surrender of a Warrant Certificate for
registration of transfer and in compliance with the provisions set forth in this
Section 2.5. When a Warrant is presented to the Warrant Registrar with a request
to register a transfer, the Warrant Registrar shall register the transfer as
requested if its requirements therefor are met. When Warrants are presented to
the Warrant Registrar with a request to exchange them for an equal number of
Warrants of other denominations, the Warrant Registrar shall make the exchange
as requested if the same requirements are met. To permit registration of
transfers and exchanges, the Corporation shall execute and the Warrant Agent
shall authenticate Warrant Certificates at the Warrant Registrar's request.
Except as provided in the Warrant Certificate, the Corporation may require
payment from the Holder of a sum sufficient to pay all taxes, assessments or
other governmental charges in connection with any transfer, exchange or exercise
pursuant to this Section 2.5.
(b) Transfer and Exchange of Definitive Warrants. When
Definitive Warrants are presented to the Warrant Registrar with a request:
(i) to register the transfer of such Definitive
Warrants or
(ii) to exchange such Definitive Warrants for an
equal amount of Definitive Warrants of other authorized denominations,
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the Warrant Registrar shall register the transfer or make the exchange as
requested if its reasonable requirements for such transaction are met; provided,
however, that the Definitive Warrants surrendered for transfer or exchange:
(i) shall be duly endorsed or accompanied by a
written instrument substantially in the form of ANNEX B attached to the
Warrant Certificate, duly executed by the Holder thereof or his
attorney duly authorized in writing; and
(ii) in the case of Definitive Warrants which are
Transfer Restricted Warrants, are accompanied by the following
additional information and documents, as applicable:
(A) if such Definitive Warrants are being
delivered to the Warrant Registrar by a Holder to exchange
such Definitive Warrants for an equal amount of Definitive
Warrants of other authorized denominations for registration in
the name of such Holder, a certification from such Holder to
that effect, substantially in the form of ANNEX C attached to
the Warrant Certificate;
(B) if such Definitive Warrants are being
transferred to the Corporation, a certification to that
effect, substantially in the form of ANNEX C attached to the
Warrant Certificate; or
(C) if such Definitive Warrants are being
transferred pursuant to (i) an effective registration
statement under the Securities Act, (ii) inside the United
States to a QIB, or (iii) an exemption from registration in
accordance with Rule 144 under the Securities Act, Regulation
S or any other exemption from the registration requirements of
the Securities Act, (w) a certification to that effect
substantially in the form of ANNEX C attached to the Warrant
Certificate, (x) if the Corporation so requests, an Opinion of
Counsel or other evidence reasonably satisfactory to it as to
the compliance with the restrictions set forth in the legend
set forth in Section 2.5(e)(i), (y) in the case of a transfer
to a QIB, a signed letter from the transferee substantially in
the form of ANNEX D attached to the Warrant Certificate, and
(z) in the case of a transfer to an IAI, a signed letter from
the transferee substantially in the form of ANNEX E attached
to the Warrant Certificate.
(c) Restrictions on Transfer of a Definitive Warrant for a
Beneficial Interest in a Global Warrant. A Definitive Warrant may not be
exchanged for a beneficial interest in a Global Warrant except upon satisfaction
of the requirements set forth below. Upon receipt by the Warrant Agent of a
Definitive Warrant, duly endorsed or accompanied by a written instrument of
transfer in form reasonably satisfactory to the Corporation and the Warrant
Registrar, together with:
(i) certification, substantially in the form of ANNEX
C attached to the Warrant Certificate, that such Definitive Warrant is
being transferred (1) to a QIB in accordance with Rule 144A or to a
Person pursuant to Regulation S or any other exemption from the
registration requirements of the Securities Act, in each case that has
furnished to the Warrant Agent a signed letter substantially in the
form of ANNEX D attached to the Warrant Certificate or (2) to an IAI
that has furnished to the Warrant Agent a signed letter substantially
in the form of ANNEX E attached to the Warrant
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Certificate, and in each case an Opinion of Counsel or other evidence
reasonably satisfactory to the Warrant Agent as to the compliance with
the restrictions set forth in the legend set forth in Section
2.5(e)(i); and
(ii) written instructions directing the Warrant Agent
to make, or to direct the Warrant Custodian to make, an adjustment on
its books and records with respect to such Global Warrant to reflect an
increase in the aggregate amount of the Warrants represented by the
Global Warrant, such instructions to contain information regarding the
Depositary account to be credited with such increase,
then the Warrant Agent shall cancel such Definitive Warrant and cause, or direct
the Warrant Custodian to cause, in accordance with the standing instructions and
procedures existing between the Depositary and the Warrant Custodian, the
aggregate amount of Warrants represented by the Global Warrant to be increased
by the aggregate amount of the Definitive Warrant to be exchanged and shall
credit or cause to be credited to the account of the Person specified in such
instructions a beneficial interest in the Global Warrant equal to the amount of
the Definitive Warrant so canceled. If no Global Warrants are then outstanding
and the Global Warrant has not been previously exchanged for Warrant
Certificates pursuant to Section 2.6, the Corporation shall issue and the
Warrant Agent shall authenticate, upon written order of the Corporation in the
form of an Officers' Certificate, a new Global Warrant in the appropriate
amount.
(d) Transfer and Exchange of Global Warrants and Beneficial
Interests Therein. Any Holder of a Global Warrant shall, by acceptance of such
Global Warrant, agree that transfers of beneficial interests in such Global
Warrant may be effected only through a book-entry system maintained by (i) the
Holder of such Global Warrant (or its agent) or (ii) any Holder of a beneficial
interest in such Global Warrant, and that ownership of a beneficial interest in
such Global Warrant shall be required to be reflected in a book entry. All
Warrants issued upon any transfer or exchange pursuant to the terms of this
Warrant Agreement will evidence the same Warrants and shall be governed by the
same provisions of this Warrant Agreement as the Warrants surrendered upon such
transfer or exchange.
(i) The transfer and exchange of a Global Warrant or
beneficial interests therein shall be effected through the Depositary,
in accordance with this Warrant Agreement (including applicable
restrictions on transfer set forth herein, if any) and the procedures
of the Depositary therefor. A transferor of a beneficial interest in a
Global Warrant shall deliver a written order given in accordance with
the Depositary's procedures containing information regarding the
participant account of the Depositary to be credited with a beneficial
interest in such Global Warrant or another Global Warrant and such
account shall be credited in accordance with such order with a
beneficial interest in the applicable Global Warrant and the account of
the Person making the transfer shall be debited by an amount equal to
the beneficial interest in the Global Warrant being transferred. In the
case of a transfer of a beneficial interest in the IAI Global Warrant
for an interest in the Rule ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, the transferee must
furnish certification substantially in the form of ANNEX D attached to
the Warrant Certificate, and if the Corporation so requests, an Opinion
of Counsel or other evidence reasonably satisfactory to the Warrant
Agent as to the compliance with the restriction set forth in Section
2.5(e)(i).
(ii) If the proposed transfer is a transfer of a
beneficial interest in one Global Warrant to a beneficial interest in
another Global Warrant, the Warrant Registrar
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shall reflect on its books and records the date and an increase in the
amount of the Global Warrant to which such interest is being
transferred in an amount equal to the amount of the interest to be so
transferred, and the Warrant Registrar shall reflect on its books and
records the date and a corresponding decrease in the amount of Global
Warrant from which such interest is being transferred.
(iii) Notwithstanding any other provisions of this
Warrant Agreement (other than the provisions set forth in Section 2.6),
a Global Warrant may not be transferred as a whole except by the
Depositary to a nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the Depositary or by
the Depositary or any such nominee to a successor Depositary or a
nominee of such successor Depositary.
(iv) In the event that a Global Warrant is exchanged
for Definitive Warrants pursuant to Section 2.6, such Global Warrant
may be exchanged only in accordance with such procedures as are
substantially consistent with the provisions of this Section 2.5
(including the certification requirements set forth in ANNEX D and
ANNEX E, as applicable, of the Warrant Certificate intended to ensure
that such transfers comply with Rule 144A or such other applicable
exemption from registration under the Securities Act, as the case may
be) and such other procedures as may from time to time be adopted by
the Corporation.
(e) Legend.
(i) Except as permitted by the following paragraph
(ii), each Warrant Certificate evidencing the Global Warrant and the
Definitive Warrants (and all Warrants issued in exchange therefor or in
substitution thereof) shall bear a legend in substantially the
following form (each defined term in the legend being defined as such
for purposes of the legend only):
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE U. S. SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY
STATE, AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED
STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U. S. PERSONS EXCEPT AS
SET FORTH IN THE FOLLOWING SENTENCE. BY ITS ACQUISITION HEREOF, THE
HOLDER (1) REPRESENTS THAT IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR"
(AS DEFINED IN RULE 501(a)(l), (2), (3) OR (7) UNDER THE SECURITIES
ACT) (AN "INSTITUTIONAL ACCREDITED INVESTOR"), (2) AGREES THAT IT WILL
NOT PRIOR TO THE DATE WHICH IS TWO YEARS AFTER THE LATER OF THE DATE OF
ORIGINAL ISSUANCE OF THIS SECURITY AND THE LAST DATE ON WHICH QUALITY
DISTRIBUTION, INC. ("THE ISSUER") OR ANY AFFILIATE OF THE CORPORATION
WAS THE OWNER OF THIS SECURITY (THE "RESALE RESTRICTION TERMINATION
DATE") RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT (A) TO THE
CORPORATION OR ANY SUBSIDIARY THEREOF, (B) IN THE UNITED STATES TO A
QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE
SECURITIES ACT, (C) IN THE UNITED STATES TO AN INSTITUTIONAL ACCREDITED
INVESTOR THAT IS ACQUIRING THE SECURITY FOR ITS OWN ACCOUNT FOR
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INVESTMENT PURPOSES AND NOT WITH A VIEW TO OR FOR OFFER OR SALE IN
CONNECTION WITH ANY DISTRIBUTION IN VIOLATION OF THE SECURITIES ACT
PROVIDED THAT PRIOR TO SUCH TRANSFER, THE INSTITUTIONAL ACCREDITED
INVESTOR FURNISHES TO THE WARRANT AGENT A SIGNED LETTER CONTAINING
CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON
TRANSFER OF THIS SECURITY (THE FORM OF WHICH LETTER CAN BE OBTAINED
FROM THE WARRANT AGENT), (D) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT; (E)
PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER
THE SECURITIES ACT (IF AVAILABLE), (F) PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR (G) PURSUANT TO ANY
OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT, SUBJECT IN EACH OF THE FOREGOING CASES TO ANY
REQUIREMENT OF LAW THAT THE DISPOSITION OF ITS PROPERTY OR THE PROPERTY
OF SUCH ACCOUNT BE AT ALL TIMES WITHIN ITS CONTROL AND TO COMPLIANCE
WITH APPLICABLE STATE SECURITIES LAWS AND (3) ACKNOWLEDGES THAT THE
SECURITY IS SUBJECT TO A DRAG ALONG RIGHT AS SET FORTH IN SECTION 3 OF
THIS WARRANT CERTIFICATE AND (4) AGREES THAT IT WILL DELIVER TO EACH
PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO
THE EFFECT OF THIS LEGEND. IF THE PROPOSED TRANSFEREE IS AN
INSTITUTIONAL ACCREDITED INVESTOR OR THE TRANSFER IS MADE PURSUANT TO
CLAUSES (C), (D), (E) OR (G) ABOVE, THE HOLDER MUST, PRIOR TO SUCH
TRANSFER, FURNISH TO THE WARRANT AGENT AND THE CORPORATION, SUCH
CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS EITHER OF THEM
MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE
PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. THE FOREGOING
RESTRICTIONS ON RESALE WILL NOT APPLY SUBSEQUENT TO THE RESALE
RESTRICTION TERMINATION DATE.
Each Definitive Warrant will also bear the following
additional legend:
"IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE
WARRANT AGENT AND THE WARRANT REGISTRAR SUCH CERTIFICATES AND OTHER INFORMATION
AS SUCH WARRANT AGENT MAY REASONABLY REQUIRE TO CONFIRM THAT THE TRANSFER
COMPLIES WITH THE FOREGOING RESTRICTIONS."
(ii) Upon any sale or transfer of a Transfer
Restricted Warrant that is a Definitive Warrant, the Warrant Registrar
shall permit the Holder thereof to exchange such Transfer Restricted
Warrant for a Definitive Warrant that does not bear the legends set
forth above and rescind any restriction on the transfer of such
Transfer Restricted Warrant if the Holder certifies in writing to the
Warrant Registrar that its request for such exchange was made in
reliance on Rule 144 (such certification to be in the form set forth in
ANNEX C of the Warrant Certificate) and delivers an Opinion of Counsel
or other
10
evidence reasonably satisfactory to the Warrant Registrar as to
compliance with the restrictions set forth in the legend set forth in
Section 2.5(e)(i).
(f) Cancellation or Adjustment of Global Warrant. At such time
as all beneficial interests in a Global Warrant have either been exchanged for
Definitive Warrants, transferred, redeemed, repurchased, canceled or exercised
such Global Warrant shall be returned by the Depositary to the Warrant Agent for
cancellation or retained and canceled by the Warrant Agent. At any time prior to
such cancellation, if any beneficial interest in a Global Warrant is exchanged
for Definitive Warrants, transferred in exchange for an interest in another
Global Warrant, redeemed, repurchased, canceled or exercised the number of
Warrants represented by such Global Warrant shall be reduced and an adjustment
shall be made on the books and records of the Warrant Agent (if it is then the
Warrant Custodian for such Global Warrant) with respect to such Global Warrant,
by the Warrant Agent or the Warrant Custodian, to reflect such reduction.
(g) Obligations with Respect to Transfers and Exchanges of
Warrants.
(i) To permit registrations of transfers and
exchanges, the Corporation shall execute and the Warrant Agent shall
authenticate, Definitive Warrants and Global Warrants at the Warrant
Registrar's request.
(ii) No service charge shall be made for any
registration of transfer or exchange, but the Corporation may require
payment of a sum sufficient to cover any transfer tax, assessments, or
similar governmental charge payable in connection therewith (other than
any such transfer taxes, assessments, or similar governmental charge
payable upon exchanges to be registered in the name of the registered
Holder effecting the exchange pursuant to this Section 2.5).
(iii) All Warrants issued upon any transfer or
exchange pursuant to the terms of this Warrant Agreement shall evidence
the same terms and shall be entitled to the same benefits under this
Warrant Agreement as the Warrants surrendered upon such transfer or
exchange.
(h) No Obligation of the Warrant Agent.
(i) The Warrant Agent shall have no responsibility or
obligation to any beneficial owner of a Global Warrant, a member of or
a participant in the Depositary or any other Person with respect to the
accuracy of the records of the Depositary or its nominee or of any
participant or member thereof, with respect to any ownership interest
in the Warrants or with respect to the delivery to any participant,
member, beneficial owner or other Person (other than the Depositary) of
any notice or the payment of any amount, under or with respect to such
Warrants. All notices and communications to be given to the Holders
under the Warrants shall be given only to the registered Holders (which
shall be the Depositary or its nominee in the case of a Global
Warrant). The rights of beneficial owners in any Global Warrant shall
be exercised only through the Depositary subject to the applicable
rules and procedures of the Depositary. The Warrant Agent may rely and
shall be fully protected in relying upon information furnished by the
Depositary with respect to its members, participants and any beneficial
owners.
(ii) The Warrant Agent shall have no obligation or
duty to monitor, determine or inquire as to compliance with any
restrictions on transfer imposed under this
11
Warrant Agreement or under applicable law with respect to any transfer
of any interest in any Warrant (including any transfers between or
among Depositary participants, members or beneficial owners in any
Global Warrant) other than to require delivery of such certificates and
other documentation or evidence as are expressly required by, and to do
so if and when expressly required by, the terms of this Warrant
Agreement, and to examine the same to determine substantial compliance
as to form with the express requirements hereof.
2.6 DEFINITIVE WARRANTS.
(a) A Global Warrant deposited with the Depositary or with the
Warrant Agent as Warrant Custodian pursuant to Section 2.1(b) shall be
transferred to the beneficial owners thereof in the form of Definitive Warrants
in an aggregate amount equal to the amount of such Global Warrant, in exchange
for such Global Warrant, only if such transfer complies with Section 2.5 and (i)
the Depositary notifies the Corporation that it is unwilling or unable to
continue as a Depositary for such Global Warrant or if at any time the
Depositary ceases to be a "clearing agency" registered under the Exchange Act,
and a successor Depositary is not appointed by the Corporation within 90 days of
such notice, or after the Corporation becomes aware of such cessation, (ii) the
Depositary is in default of, or has committed a default under, this Warrant
Agreement or the Warrant Certificate, or (iii) the Corporation, in its sole
discretion, notifies the Warrant Agent in writing that it elects to cause the
issuance of Definitive Warrants under this Warrant Agreement.
(b) Any Global Warrant that is transferable to the beneficial
owners thereof pursuant to this Section 2.6 shall be surrendered by the
Depositary to the Warrant Agent, to be so transferred, in whole or from time to
time in part, without charge, and the Warrant Agent shall authenticate and
deliver, upon such transfer of each portion of such Global Warrant, an equal
number of Definitive Warrants. Any certificated Warrant in the form of a
Definitive Warrant delivered in exchange for an interest in the Global Warrant
shall, except as otherwise provided by Section 2.5(e), bear the Restricted
Warrant Legend.
(c) Subject to the provisions of Section 2.6(b), the
registered Holder of a Global Warrant may grant proxies and otherwise authorize
any Person, including Agent Members and Persons that may hold interests through
Agent Members, to take any action which a Holder is entitled to take under this
Warrant Agreement or the Warrants.
(d) In the event of the occurrence of any item of the events
specified in Section 2.6(a)(i), (ii) or (iii), the Corporation will promptly
make available to the Warrant Agent a reasonable supply of Definitive Warrants
in fully registered form.
2.7 LOST, STOLEN, DESTROYED, DEFACED OR MUTILATED WARRANT CERTIFICATE.
If a mutilated Warrant is surrendered to the Warrant Agent or
if the Holder of a Warrant claims that the Warrant Certificate has been lost,
destroyed, stolen or defaced, the Corporation shall issue and the Warrant Agent
shall authenticate a replacement Warrant Certificate if the requirements of
Section 8-405 of the Uniform Commercial Code are met, such that the Holder (a)
notifies the Corporation or the Warrant Agent within a reasonable time after
such Holder has notice of such loss, destruction or theft and the Warrant
Registrar does not register a transfer prior to receiving such notification, (b)
makes such request to the Corporation or the Warrant Agent prior to the Warrant
being acquired by a protected purchaser as defined in
12
Section 8-303 of the Uniform Commercial Code (a "protected purchaser") and (c)
satisfies any other reasonable requirements of the Warrant Agent. If required by
the Warrant Agent or the Corporation, such Holder shall furnish an indemnity
bond sufficient in the judgment of the Warrant Agent to protect the Corporation
and the Warrant Agent from any loss that either of them may suffer if a Warrant
is replaced. The Corporation and the Warrant Agent may charge the Holder for
their expenses in replacing a Warrant Certificate. Every replacement Warrant is
an additional obligation of the Corporation. The provisions of this Section 2.7
are exclusive and shall preclude (to the extent lawful) all other rights and
remedies with respect to the replacement of mutilated, lost, destroyed or
wrongfully taken Warrants.
2.8 OUTSTANDING WARRANTS.
Warrants outstanding at any time are all Warrant Certificates
executed by the Corporation and authenticated by the Warrant Agent except for
those canceled by it, those delivered to it for cancellation and those described
in this Section 2.8 as not outstanding. A Warrant does not cease to be
outstanding because an Affiliate of the Corporation holds the Warrant. A Warrant
ceases to be outstanding if the Corporation holds the Warrant. If a Warrant
Certificate is replaced pursuant to Section 2.7, it ceases to be outstanding
unless the Warrant Agent and the Corporation receive proof satisfactory to them
that the replaced Warrant Certificate is held by a protected purchaser.
2.9 TEMPORARY WARRANTS.
In the event that Definitive Warrants are to be issued under
the terms of this Warrant Agreement, until such Definitive Warrants are ready
for delivery, the Corporation may prepare and the Warrant Agent shall
authenticate temporary Warrant Certificates (the "Temporary Warrant
Certificates"). Temporary Warrant Certificates shall be substantially in the
form of Definitive Warrants but may have variations that the Corporation
considers appropriate for temporary Warrants. Without unreasonable delay, the
Corporation shall prepare and the Warrant Agent shall authenticate Definitive
Warrants and deliver them in exchange for Temporary Warrant Certificates upon
surrender of such Temporary Warrant Certificates at the office or agency of the
Corporation, without charge to the Holder.
2.10 CANCELLATION.
The Corporation at any time may deliver Warrant Certificates
to the Warrant Agent for cancellation. The Warrant Agent and no one else shall
cancel all Warrant Certificates surrendered for registration of transfer,
exchange, exercise or cancellation and shall dispose of canceled Warrant
Certificates in accordance with its customary procedures or deliver canceled
Warrant Certificates to the Corporation pursuant to written direction by an
Officer. The Corporation may not issue new Warrant Certificates to replace
Warrant Certificates that have been exercised or Warrants which the Corporation
has purchased or otherwise acquired. The Warrant Agent shall not authenticate
Warrant Certificates to replace canceled Warrant Certificates other than
pursuant to the terms of this Warrant Agreement.
2.11 CUSIP NUMBERS.
The Corporation may use "CUSIP" numbers (if then generally in
use) in issuing the Warrants and, if so, the Warrant Agent shall also use
"CUSIP" numbers in notices to Holders; provided, however, that any such notice
may state that no representation is made as to
13
the correctness of such numbers either as printed on the Warrant Certificates or
as contained in any notice and that reliance may be placed only on the other
identification numbers printed on the Warrant Certificates, and any such notice
shall not be affected by any defect in or omission of such numbers.
ARTICLE III
WARRANT AGENT
3.1 APPOINTMENT OF WARRANT AGENT.
The Corporation hereby appoints the Warrant Agent to act as
agent for the Corporation in accordance with the provisions of this Warrant
Agreement and the Warrant Agent hereby accepts such appointment.
3.2 RIGHTS AND DUTIES OF WARRANT AGENT.
(a) Agent for the Corporation. In acting under this Warrant
Agreement and in connection with the Warrant Certificates, the Warrant Agent is
acting solely as agent of the Corporation and does not assume any obligation or
relationship or agency or trust for or with any of the holders of Warrant
Certificates or beneficial owners of Warrants.
(b) Counsel. The Warrant Agent may consult with counsel
satisfactory to it (and may require an Opinion of Counsel before it acts or
refrains from acting), and the advice of such counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted
by it hereunder in good faith and in accordance with the advice of such counsel.
(c) Documents. The Warrant Agent shall be protected and shall
incur no liability for or in respect of any action taken or thing suffered by it
in reliance upon any Warrant Certificate, notice, direction, consent,
certificate, affidavit, statement or other paper or document reasonably believed
by it to be genuine and to have been presented or signed by the proper parties.
(d) No Implied Obligations. The Warrant Agent shall be
obligated to perform only such duties as are specifically set forth herein and
in the Warrant Certificates, and no implied duties or obligations of the Warrant
Agent shall be read into this Warrant Agreement or the Warrant Certificates
against the Warrant Agent. The Warrant Agent shall not be under any obligation
to take any action hereunder which may tend to involve it in any expense or
liability for which it does not receive indemnity reasonably satisfactory to it.
The Warrant Agent shall not be accountable or under any duty or responsibility
for the use by the Corporation of any of the Warrant Certificates authenticated
by the Warrant Agent and delivered by it to the Holders or on behalf of the
Holders pursuant to this Warrant Agreement or for the application by the
Corporation of the proceeds of the Warrants. The Warrant Agent shall have no
duty or responsibility in case of any default by the Corporation in the
performance of its covenants or agreements contained herein or in the Warrant
Certificates or in the case of the receipt of any written demand from a Holder
with respect to such default, including any duty or responsibility to initiate
or attempt to initiate any proceedings at law or otherwise.
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(e) Not Responsible for Adjustments or Validity of Stock. The
Warrant Agent shall not at any time be under any duty or responsibility to any
Holder to determine whether any facts exist that may require an adjustment of
the number of shares of Common Stock issuable upon exercise of each Warrant or
the Exercise Price, or with respect to the nature or extent of any adjustment
when made, or with respect to the method employed, or herein or in any
supplemental agreement provided to be employed, in making the same. The Warrant
Agent shall not be accountable with respect to the validity or value of any
shares of Common Stock or of any securities or property which may at any time be
issued or delivered upon the exercise of any Warrant or upon any adjustment to
the Exercise Price, and it makes no representation with respect thereto. The
Warrant Agent shall not be responsible for any failure of the Corporation to
make any cash payment or to issue, transfer or deliver any shares of Common
Stock or stock certificates upon the surrender of any Warrant Certificate for
the purpose of exercise or upon any adjustment to the Exercise Price, or to
comply with the covenants set forth in Section 5 of the Warrant Certificate.
3.3 INDIVIDUAL RIGHTS OF WARRANT AGENT.
The Warrant Agent and any stockholder, director, officer or
employee of the Warrant Agent may buy, sell or deal in any of the Warrants or
other securities of the Corporation or its Affiliates and may otherwise deal
with the Corporation or its Affiliates with the same rights it would have if it
were not Warrant Agent. Nothing herein shall preclude the Warrant Agent from
acting in any other capacity for the Corporation or for any other legal entity.
3.4 WARRANT AGENT'S DISCLAIMER.
The Warrant Agent shall not be responsible for and makes no
representation as to the validity or adequacy of this Warrant Agreement or the
Warrant Certificates and it shall not be responsible for any statement of the
Corporation in this Warrant Agreement or the Warrant Certificates other than the
Warrant Agent's signature of authentication.
3.5 COMPENSATION AND INDEMNITY.
The Corporation agrees to pay to the Warrant Agent from time
to time such compensation for its services as shall be agreed to in writing from
time to time by the Corporation and the Warrant Agent. The Corporation shall
reimburse the Warrant Agent upon request for all reasonable out-of-pocket
expenses incurred or made by it, including costs of collection, in addition to
the compensation for its services. Such expenses shall include the reasonable
compensation, expenses, disbursements and advances of the Warrant Agent's agents
and counsel. The Corporation shall indemnify the Warrant Agent and any
predecessor Warrant Agent against, and hold it harmless from, any and all loss,
liability, claim, damage or expense (including reasonable agents' and attorneys'
fees and expenses), including taxes (other than taxes based upon, measured by,
or determined by the income of the Warrant Agent) incurred by it without gross
negligence or bad faith on its part arising out of or in connection with the
acceptance or performance of its duties under this Warrant Agreement. The
Warrant Agent shall notify the Corporation promptly of any claim for which it
may seek indemnity promptly upon obtaining actual notice thereof; provided,
however, that any failure so to notify the Corporation shall not relieve the
Corporation of its indemnity obligations hereunder. The Corporation shall defend
the claim and the Warrant Agent shall provide reasonable cooperation at the
Corporation's expense in the defense. The Warrant Agent may have separate
counsel and the Corporation shall pay the fees and expenses of such counsel;
provided, however, that the
15
Corporation shall not be required to pay such fees and expenses if it assumes
the Warrant Agent's defense and, in the Warrant Agent's reasonable judgment,
there is no conflict of interest between the Corporation and the Warrant Agent
in connection with such defense. The Corporation need not reimburse any expense
or indemnify against any loss, liability or expense incurred by the Warrant
Agent through the Warrant Agent's own willful misconduct, gross negligence or
bad faith. The Corporation's payment obligations pursuant to this Section 3.5
shall survive the termination of this Warrant Agreement and the resignation or
removal of the Warrant Agent.
3.6 SUCCESSOR WARRANT AGENT.
(a) The Corporation To Provide and Maintain Warrant Agent. The
Corporation agrees for the benefit of the Holders that there shall be a Warrant
Agent at all times until all of the Warrants have been exercised or are no
longer exercisable.
(b) Resignation and Removal. The Warrant Agent may at any time
resign by giving written notice to the Corporation of such intention on its
part, specifying the date on which its desired resignation shall become
effective; provided, however, that such date shall not be less than 30 days
after the date on which such notice is given unless the Corporation otherwise
agrees. The Warrant Agent hereunder may be removed at any time by the filing
with it of an instrument in writing signed by or on behalf of the Corporation
and specifying such removal and the date when it shall become effective, which
date shall not be less than 30 days after such notice is given unless the
Warrant Agent otherwise agrees. Any removal under this Section 3.6(b) shall take
effect upon the appointment by the Corporation as hereinafter provided of a
successor Warrant Agent (which shall be a bank or trust company authorized under
the laws of the jurisdiction of its organization to exercise corporate trust
powers) and the acceptance of such appointment by such successor Warrant Agent.
At any time that the Warrant Agent is also acting as trustee (the "Trustee")
under the indenture for the New Notes (the "New Note Indenture"), and holders of
the New Notes remove the Trustee pursuant to the terms of the New Note
Indenture, the Corporation shall remove the Warrant Agent pursuant to this
Section 3.6(b).
(c) The Corporation To Appoint Successor. In the event that at
any time the Warrant Agent shall resign, or shall be removed, or shall become
incapable of acting, or shall be adjudged a bankrupt or insolvent, or shall
commence a voluntary case under the federal bankruptcy laws, as now or hereafter
constituted, or under any other applicable federal or state bankruptcy,
insolvency or similar law or shall consent to the appointment of or taking
possession by a receiver, custodian, liquidator, assignee, trustee, sequestrator
(or other similar official) of the Warrant Agent or its property or affairs, or
shall make an assignment for the benefit of creditors, or shall admit in writing
its inability to pay its debts generally as they become due, or shall take
corporate action in furtherance of any such action, or a decree or order for
relief by a court having jurisdiction in the premises shall have been entered in
respect of the Warrant Agent in an involuntary case under the Federal bankruptcy
laws, as now or hereafter constituted, or any other applicable Federal or state
bankruptcy, insolvency or similar law, or a decree or order by a court having
jurisdiction in the premises shall have been entered for the appointment of a
receiver, custodian, liquidator, assignee, trustee, sequestrator (or similar
official) of the Warrant Agent or of its property or affairs, or any public
officer shall take charge or control of the Warrant Agent or of its property or
affairs for the purpose of rehabilitation, conservation, winding up or
liquidation, a successor Warrant Agent, qualified as aforesaid, shall be
appointed by the Corporation by an instrument in writing, filed with the
successor Warrant Agent. Upon the appointment of a successor Warrant Agent and
acceptance by the successor Warrant Agent of
16
such appointment, the Warrant Agent shall cease to be Warrant Agent hereunder;
provided, however, that in the event of the resignation of the Warrant Agent
under this subsection (c), such resignation shall be effective on the earlier of
(i) the date specified in the Warrant Agent's notice of resignation and (ii) the
appointment and acceptance of a successor Warrant Agent hereunder.
(d) Successor To Expressly Assume Duties. Any successor
Warrant Agent appointed hereunder shall execute, acknowledge and deliver to its
predecessor and to the Corporation an instrument accepting such appointment
hereunder, and thereupon such successor Warrant Agent, without any further act,
deed or conveyance, shall become vested with all the rights and obligations of
such predecessor with like effect as if originally named as Warrant Agent
hereunder, and such predecessor, upon payment of its charges and disbursements
then unpaid, shall thereupon become obligated to transfer, deliver and pay over,
and such successor Warrant Agent shall be entitled to receive, all monies,
securities and other property on deposit with or held by such predecessor, as
Warrant Agent hereunder.
(e) Successor by Merger. If the Warrant Agent consolidates
with, merges or converts into, or transfers all or substantially all its
corporate trust business or assets to, another corporation or banking
association, the resulting, surviving or transferee corporation without any
further act shall be the successor Warrant Agent. In case at the time such
successor or successors by merger, conversion or consolidation to the Warrant
Agent shall succeed to the agency created by this Warrant Agreement, any of the
Warrant Certificates shall have been authenticated but not delivered, any such
successor to the Warrant Agent may adopt the certificate of authentication of
any predecessor Warrant Agent, and deliver such Warrant Certificates so
authenticated; and in case at that time any of the Warrant Certificates shall
not have been authenticated, any successor to the Warrant Agent may authenticate
such Warrant Certificates either in the name of any predecessor hereunder or in
the name of the successor to the Warrant Agent.
ARTICLE IV
MISCELLANEOUS
4.1 REPORTS TO WARRANT AGENT AND HOLDERS.
The Corporation shall provide the Warrant Agent, Holders and
prospective Holders, upon their request, the information required to be
delivered pursuant to Rule 144A(d)(4) under the Securities Act. Delivery of such
reports, information and documents to the Warrant Agent and Holders is for
informational purposes only and the Warrant Agent's and Holder's receipt of such
shall not constitute constructive notice of any information contained therein or
determinable from information contained therein, including the Corporation's
compliance with any of its covenants hereunder (as to which the Warrant Agent is
entitled to rely exclusively on Officers' Certificates).
4.2 PERSONS BENEFITING.
Nothing in this Warrant Agreement is intended or shall be
construed to confer upon any Person other than the Corporation, the Warrant
Agent and the Holders any right, remedy or claim under or by reason of this
Warrant Agreement or any part hereof.
17
4.3 RIGHTS OF HOLDERS.
Holders of unexercised Warrants are not entitled to (i)
receive dividends or other distributions, (ii) receive notice of or vote at any
meeting of the stockholders, (iii) consent to any action of the stockholders,
(iv) receive notice of any other proceedings of the Corporation, (v) exercise
any preemptive right or (vi) exercise any other rights whatsoever as
stockholders of the Corporation. Nothing in this Warrant Certificate shall be
construed to give the Holders any rights as a holder of shares of Common Stock
until such time, if any, as the Warrants evidenced by this Warrant Certificates
are exercised in accordance with the provisions of this Warrant Agreement and
the Warrant Certificates.
4.4 AMENDMENT, WAIVER, MODIFICATION, ETC.
This Warrant Agreement and the Warrant Certificates may be
amended by the parties hereto without the consent of any Holder for the purpose
of curing any ambiguity, or of curing, correcting or supplementing any defective
provision contained herein or adding or changing any other provisions with
respect to matters or questions arising under this Warrant Agreement and the
Warrant Certificates as the Corporation and the Warrant Agent may deem necessary
or desirable (including without limitation any addition or modification to
provide for compliance with the transfer restrictions set forth herein);
provided, however, that such action shall not materially adversely affect the
rights of any of the Holders. Any term or terms of this Warrant Agreement and
the Warrant Certificates may be amended and the observance of any term of this
Warrant Agreement and the Warrant Certificates may be waived (either generally
or in a particular instance and either retroactively or prospectively), with the
written consent of the Corporation and the holders of a majority of shares of
Common Stock issuable upon exercise of outstanding Warrants issued in connection
with the Exchange Offer. Any waiver, amendment or modification effected in
accordance with this Section 4.4 shall be binding upon each Holder, each holder
of any shares of Common Stock obtained under this Warrant Agreement at the time
outstanding, each future holder of all such shares of Common Stock, and the
Corporation. The Holder acknowledges that by operation of this Section 4.4, the
holders of a majority of shares of Common Stock issuable upon exercise of
Warrants issued in connection with the Exchange Offer will have the right and
power to diminish or eliminate all rights of such Holder under this Warrant
Agreement.
4.5 NOTICES.
All notices, demands and other communications provided for or
permitted hereunder shall be made in writing and shall be by registered or
certified first-class mail, return receipt requested, courier services or
personal delivery, if to the holder of a Warrant, at such holder's last known
address, as it appears on the records of the Warrant Agent;
if to the Corporation:
Quality Distribution, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention of: President and Chief Executive Officer
18
with a copy to:
▇'▇▇▇▇▇▇▇▇ LLP
▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention of: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
if to the Warrant Agent:
The Bank of New York
▇ ▇▇▇▇ ▇▇▇▇▇ - ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attention of: Corporate Trust Division
The Corporation or the Warrant Agent by notice to the other
may designate additional or different addresses for subsequent notices or
communications. Failure to mail a notice or communication to a Holder or any
defect in it shall not affect its sufficiency with respect to other Holders. If
a notice or communication is mailed in the manner provided above, it is duly
given, whether or not the addressee receives it. All such notices and
communications shall be deemed to have been duly given (i) when delivered by
hand, if personally delivered; (ii) one Business Day following the date
delivered to a courier with overnight delivery requested, if delivered by a
recognized commercial overnight courier service guaranteeing next Business Day
delivery; and (iii) five Business Days after being deposited in the mail,
postage prepaid, if mailed.
4.6 GOVERNING LAW.
THIS WARRANT AGREEMENT SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE GOVERNED BY, THE LAWS OF
THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY
WITHIN SUCH STATE BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF
CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER
JURISDICTION WOULD BE REQUIRED THEREBY.
4.7 SUCCESSORS.
The terms of this Warrant Agreement and the Warrant
Certificates shall be binding upon and shall inure to the benefit of the
respective successors or permitted assigns of the Corporation, the Warrant
Agent, the Holders and the holders of the Common Stock issued or issuable upon
the exercise of the Warrants. Nothing in this Warrant Agreement and the Warrant
Certificates shall be construed to give to any Person other than the
Corporation, the Warrant Agent or the Holders any legal or equitable right,
remedy or claim under this Warrant Agreement and the Warrant Certificates, and
this Warrant Agreement and the Warrant Certificates shall be for the sole and
exclusive benefit of the Corporation, the Warrant Agent and the Holders;
provided, however, that Apollo Investment Fund III, L.P., Apollo Overseas
Investment Partners III, L.P. and Apollo (U.K.) Partners III, L.P., and each of
their respective successors and
19
permitted assigns, shall be deemed a party to the Warrant Certificates for the
purposes of Section 3(b) thereof.
4.8 COUNTERPARTS.
This Warrant Agreement may be executed in any number of
counterparts, each of which shall be considered an original, but all of which
together shall constitute one and the same instrument.
4.9 TABLE OF CONTENTS AND HEADINGS.
The table of contents and headings of the Articles and
Sections of this Warrant Agreement and the Warrant Certificates have been
inserted for convenience of reference only, are not intended to be considered a
part hereof and shall not modify or restrict any of the terms or provisions
hereof.
4.10 SEVERABILITY.
The provisions of this Warrant Agreement and the Warrant
Certificates are severable, and if any clause or provision shall be held
invalid, illegal or unenforceable in whole or in part in any jurisdiction, then
such invalidity or unenforceability shall affect in that jurisdiction only such
clause or provision, or part thereof, and shall not in any manner affect such
clause or provision in any other jurisdiction or any other clause or provision
of this Warrant Agreement and the Warrant Certificates in any jurisdiction.
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IN WITNESS WHEREOF, the parties have caused this Warrant
Agreement to be duly executed as of the date first written above.
QUALITY DISTRIBUTION, INC.
By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
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Title: President and Chief Executive Officer
THE BANK OF NEW YORK,
as Warrant Agent
By:/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Title: Assistant Vice President
EXHIBIT A
WARRANT CERTIFICATE