EXECUTION COPY
Exhibit 10.52
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REGISTRATION RIGHTS AGREEMENT
among
LUFTHANSA TECHNIK AG
and
HAWKER PACIFIC AEROSPACE
DATED SEPTEMBER 20, 2000
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TABLE OF CONTENTS
Page
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1. Definitions................................................................................... 1
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2. Restrictions on Transferability............................................................... 1
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3. Restrictive Legend............................................................................ 2
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4. Notice of Proposed Transfers.................................................................. 2
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5. Demand Registration........................................................................... 3
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6. Piggyback Registration........................................................................ 5
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7. Registration on Form S-3...................................................................... 6
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8. Expenses of Registration...................................................................... 7
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9. Registration Procedures....................................................................... 7
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10. Termination of Registration Rights............................................................ 9
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11. Lock-up Agreement............................................................................. 9
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12. Information by Holder......................................................................... 9
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13. Indemnification............................................................................... 9
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14. Rule 144 Reporting........................................................................... 11
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15. Transfer of Registration Rights.............................................................. 11
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16. Subsequent Grant of Registration Rights...................................................... 11
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17. Arbitration.................................................................................. 12
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18. Miscellaneous................................................................................ 12
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REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is made as of this
20th day of September, 2000 by and among Hawker Pacific Aerospace, a California
corporation (the "Company"), and Lufthansa Technik AG, a company organized under
the laws of Germany (the "Holder").
RECITALS
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A. The Company and Holder have entered into that certain Loan Agreement
of even date herewith pursuant to which Holder shall extend a loan to the
Company for $9,300,000 (the "Loan Agreement").
B. The Company has issued in conjunction with the Loan Agreement a
Warrant equal to 2,500,000 shares of Common Stock subject to shareholder
approval (the "Warrant").
C. The Holder and certain shareholders of the Company have entered into a
Purchase Agreement by which Holder shall acquire 2,336,495 shares of Common
Stock (the "Purchase Agreement").
D. The obligation of Holder to extend the loan under the Loan Agreement
and the obligation of Holder to acquire shares pursuant to the Purchase
Agreement are conditioned upon, among other things, the execution and delivery
by the Company of this Agreement.
NOW THEREFORE, in consideration of the foregoing recitals and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, intend to be legally bound, agree as follows:
1. Definitions. For purposes of this Agreement, and except as otherwise
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provided herein or unless the context otherwise requires, capitalized terms
shall have the meaning ascribed to them in Annex I.
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2. Restrictions on Transferability. The Restricted Securities shall
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not be transferable except upon satisfaction of the conditions specified in this
Agreement, which conditions are intended to ensure compliance with the
provisions of the Securities Act. The Holder will cause any proposed transferee
of the Restricted Securities held by Holder, other than a transferee acquiring
such securities in connection with a registered offering covering such
disposition, to agree to take and hold such Restricted Securities subject to the
provisions and upon the conditions specified in this Agreement. Notwithstanding
anything to the contrary in this Agreement, a Holder may Transfer to any
transferee (i) all its Restricted Securities or (ii) an amount equal to at least
10,000 shares of its Restricted Securities (as adjusted for stock splits, stock
dividends and the like); provided, that such transferee shall agree to be bound
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by the terms of this Agreement; provided further, that such
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transferee shall be subject to the limitations set forth in Section 15.
Notwithstanding anything to the contrary in this Agreement, a Holder may
Transfer Restricted Securities, in whole or in any part, to a wholly-owned
Affiliate of such Holder or otherwise in accordance with the Shareholders Rights
Agreement and such Transfer shall not be subject to any restrictions on
transferability set forth in this Agreement; provided, that such wholly-owned
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Affiliate or transferee shall agree to be bound by the terms of this Agreement.
3. Restrictive Legend. Each certificate representing (i) the shares of
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the Company's Common Stock and (ii) any other securities issued in respect of
the Common Stock issued upon any stock split, stock dividend, recapitalization,
merger, consolidation or similar event, shall (unless otherwise permitted by the
provisions of Section 4 below) be stamped or otherwise imprinted with a legend
in the following form (in addition to any legend required under applicable
securities laws):
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933 AND HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT
WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO
SUCH SALE OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION
STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL IN FORM SATISFACTORY TO
THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER SAID ACT.
Holder consents to the Company making a notation on its records and giving
instructions to any transfer agent of the Common Stock in order to
implement the restrictions on transfer established in this Section 3. The
Company shall be obligated to reissue promptly unlegended certificates at
the request of the Holder thereof if the Holder shall have obtained an
opinion of counsel at Holder's expense (which counsel may be counsel to the
Company) reasonably acceptable to the Company to the effect that the
securities proposed to be disposed of may lawfully be so disposed of
without registration, qualification or legend.
4. Notice of Proposed Transfers
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The Holder of each certificate representing Restricted Securities by
acceptance thereof agrees to comply in all respects with the provisions of this
Section 4. Prior to any proposed transfer of any Restricted Securities, unless
there is in effect a registration statement under the Securities Act covering
the proposed transfer, the Holder thereof shall give written notice to the
Company of such Holder's intention to effect such transfer. Each such notice
shall describe the manner and circumstances of the proposed transfer in
sufficient detail, and shall, if the Company reasonably requests, be accompanied
(except in transactions in compliance with Rule 144) by either (i) a written
opinion of legal counsel who shall be reasonably satisfactory to the Company,
addressed to the Company and reasonably satisfactory in form and substance to
the Company's counsel, to the effect that the proposed transfer of the
Restricted Securities may be effected without registration under the
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Securities Act, or (ii) a "No Action" letter from the Commission to the effect
that the transfer of such securities without registration will not result in a
recommendation by the staff of the Commission that action be taken with respect
thereto, whereupon the Holder shall be entitled to transfer such Restricted
Securities in accordance with the terms of the notice delivered by the Holder to
the Company; provided, however, that no opinion or "No Action" letter need be
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obtained with respect to a transfer to (A) a partner or member, active or
retired, of a Holder of Restricted Securities, (B) the estate of any Holder of
Registrable Securities, (C) an "affiliate" of a Holder of Restricted Securities
as that term is defined in Rule 405 promulgated by the Commission under the
Securities Act, (D) if to a corporation, to its stockholders, (E) if to a
limited liability company, to its members or former members or (F) the spouse,
children, grandchildren or spouse of such children or grandchildren of any
Holder or to trusts for the benefit of any Holder or such persons, if the
transferee agrees to be subject to the terms hereof. Each certificate evidencing
the Restricted Securities transferred as above provided shall bear the
appropriate restrictive legend set forth in Section 3 above, except that such
certificate shall not bear such restrictive legend if the transferee provides an
opinion of counsel as provided in Section 3 or in the opinion of counsel for the
Company such legend is not required in order to establish compliance with any
provisions of the Securities Act.
5. Demand Registration.
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(a) Request for Registration. Subject to Section 5(b), if at any
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time or times after the date hereof, the Company shall receive from Holder a
written request that the Company effect any registration with respect to all or
any part of the Registrable Securities held by Holder (the "Demand
Registration"), the Company will:
(i) promptly give written notice of the proposed registration,
qualification or compliance to the Holder; and
(ii) as soon as practicable, use its best efforts to effect such
registration (including, without limitation, filing post-effective amendments,
appropriate qualification under applicable blue sky or other state securities
laws and appropriate compliance with applicable regulations issued under the
Securities Act and any other governmental requirements or regulations) as would
permit or facilitate the sale and distribution of all or such portion of such
Registrable Securities as are specified in such request.
Provided, however, that the Company shall not be obligated to take any
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action to effect any such registration pursuant to this Section 5:
(A) in any particular jurisdiction in which the Company
would be required to execute a general consent to service of process in
effecting such registration, qualification or compliance unless the Company is
already subject to service in such jurisdiction and except as may be required by
the Securities Act; or
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(B) after the Company has effected two such registrations
pursuant to this Section 5(a), such registrations have been declared or ordered
effective and the securities offered pursuant to such registration have been
sold.
Subject to the foregoing clauses (A) and (B), the Company shall file a
registration statement covering the Registrable Securities so requested to be
registered as soon as practicable after receipt of the request or requests of
the Holder. If, however, the Company shall furnish to the Holder a certificate
signed by the President of the Company stating that, in the good faith judgment
of the Board of Directors of the Company, it would be (i) seriously detrimental
to the Company and its stockholders for such registration statement to be filed
or (ii) necessary in connection with any expected Company-initiated registration
statement pertaining to securities of the Company (other than a registration of
securities in a Rule 145 transaction or with respect to an employee benefit
plan) and it is therefore pursuant to clauses (i) or (ii) essential to defer the
filing of such registration statement, the Company shall have the right to defer
such filing for a period of not more than 90 days after receipt of the request
of the Holder; provided, however, that the Company may not utilize this right
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more than once in any twelve-month period. The Company shall have no obligation
to maintain the effectiveness of a registration statement with respect to
Registrable Securities during periods when the Holder are required to suspend
the sale of such Registrable Securities as provided in this paragraph.
(b) Limitations. The Holder may make up to two written requests for
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a Demand Registration with respect to all or any part of the Registrable
Securities.
(c) Underwriting. If the Holder intends to distribute the
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Registrable Securities covered by their request by means of an underwriting, it
shall so advise the Company as a part of its request made pursuant to Section
5(a) and the Company shall include such information in the written notice
referred to in Section 5(a). The right of the Holder to registration pursuant to
Section 5 shall be conditioned upon such Holder's participation in such
underwriting and the inclusion of such Holder's Registrable Securities to be
registered in the underwriting to the extent requested and to the extent
provided herein. The Holder may elect to include in such underwriting all or a
part of the Registrable Securities it holds.
The Company shall (together with all shareholders proposing to distribute
their securities through such underwriting) enter into an underwriting agreement
in customary form with the managing underwriter selected for such underwriting
by a majority in interest of the Holder. Notwithstanding any other provision of
this Section 5, if the managing underwriter advises the Holder in writing that
marketing factors require a limitation of the number of shares to be
underwritten, then, subject to the provisions of Section 5(a), the Company shall
so advise the Holder and the number of shares of Registrable Securities that may
be included in the registration and underwriting shall be allocated among all
shareholders requesting inclusion in the registration as follows: (A) all
securities proposed to be offered by the Company for its own account or for the
account of holders of securities other than Registrable Securities shall be
excluded before any Registrable Securities are excluded; and (B) if, after all
non-Registrable Securities have been
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excluded, additional limitations are required, then the number of Registrable
Securities included in the registration shall be allocated among all
shareholders requesting inclusion thereof in the registration in proportion, as
nearly as practicable, to the respective amounts of Registrable Securities
proposed to be registered by such shareholders at the time of filing the
registration statement. No Registrable Securities excluded from the underwriting
by reason of the managing underwriter's marketing limitation shall be included
in such registration.
If the Holder disapproves of the terms of the underwriting, it may elect to
withdraw therefrom by written notice to the Company, the managing underwriter
and the other shareholders. The Registrable Securities and/or other securities
so withdrawn shall also be withdrawn from registration; provided, however, that
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if by the withdrawal of such Registrable Securities a greater number of
Registrable Securities held by other shareholders may be included in such
registration (up to the maximum of any limitation imposed by the underwriters),
then the Company shall offer to Holder in the registration the right to include
additional Registrable Securities in the same proportion used in determining the
underwriter limitation in this Section 5(b). If the registration does not become
effective due to the withdrawal of Registrable Securities at the behest of the
Holder and the withdrawal of the registration is not at the request or on the
advice of the Company or the underwriter nor is the result of a material adverse
change in the Company's business, financial condition, results of operations or
prospects since the date of the written request of the Holder pursuant to this
Section 5 then either (1) the Holder requesting registration shall reimburse the
Company for expenses incurred in complying with the request or (2) if the Holder
fails to make such reimbursement, the aborted registration shall be treated as
effected for purposes of Section 5(a)(ii)(B).
6. Piggyback Registration.
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(a) Notice of Registration. If at any time or times after the date
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hereof, if the Company shall determine to register any of its securities, either
for its own account or the account of a security holder or holders exercising
their respective demand registration rights, other than (i) a registration
pursuant to Section 5 or 7, (ii) a registration statement on Form S-4 or S-8 or
(iii) a registration relating solely to a Rule 415 transaction (or any
substitute form or rule, respectively, that may be adopted by the Commission)
the Company will:
(i) promptly give to Holder written notice thereof at the
address set forth in the share register of the Company as soon as reasonably
practicable (but in no event less than 15 days before the anticipated filing
date); and
(ii) subject to Section 6(b), include in such registration
(and any related qualification under blue sky laws or other compliance), and in
any underwriting, if any, involved therein, all the Registrable Securities
specified in a written request or requests (the "Piggyback Registration"),
mailed by Holder within 20 days after receipt of such written notice from the
Company. The written request of Holder may specify that all or a part of
Holder's Registrable Securities shall be included in such registration.
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(b) The Company may limit, to the extent so advised by the
underwriters, the amount of Registrable Securities to be included in the
registration by the Holder to an amount not less than 15% of the total number of
securities requested to be included by the Holder unless the inclusion of such
Registrable Securities would cause a Material Adverse Effect in which case all
Registrable Securities may be excluded from such offering; provided further,
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that the Registrable Securities held by employees, officers or directors shall
be reduced prior to any such reduction in the Holder's Registrable Securities.
Any partial reduction in number of Registrable Securities of the Holder to be
included in the Piggyback Registration shall be effected pro rata based on the
ratio which the Holder's requested shares bears to the total number of shares
requested to be included in such Piggyback Registration by all Persons other
than the Company who have the contractual right to request that their shares be
included in such registration statement and who have requested that their shares
be included, subject to the 15% floor referenced in the first sentence of this
Section 6(b). If the Company initiated the registration, for its own account or
for the account of any other Person other than the Holder, then the Company may
include all of those securities in such registration statement before any of
Holder's requested shares are included. If another security holder initiated the
registration, then the Company may not include any of its securities in such
registration statement unless all Registrable Securities requested to be
included in the registration statement by the Holder are included in such
registration statement. If as a result of the provisions of this Section 6(b)
the Holder shall not be entitled to include all Registrable Securities in a
registration that the Holder has requested to be so included, the Holder may
withdraw its request to include Registrable Securities in such registration
statement prior to its effectiveness.
7. Registration on Form S-3.
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(a) In addition to the rights set forth above and subject to Section
7(b), if the Holder requests in writing that the Company file a registration
statement on Form S-3 (or any successors thereto) ("Follow-On Registrations")
for a public offering of shares of Registrable Securities the reasonably
anticipated aggregate price to the public of which would equal at least
$1,000,000, and the Company is entitled to use Form S-3 to register securities
for such an offering, the Company shall use its best efforts to effect such
registration (including, without limitation, filing post-effective amendments,
appropriate qualifications under applicable blue sky or other state securities
laws, and appropriate compliance with the Securities Act).
(b) If a registration under this Section 7 is underwritten, the
Company may limit to the extent so advised by the underwriters, the amount of
Registrable Securities to be included in the registration by the Holder to an
amount not less than 15% of the total number of securities to be requested to be
included by the Holder, unless the inclusion of such Registrable Securities
would cause a Material Adverse Effect in which case all Registrable Securities
may be excluded from such offering; provided further, that the Registrable
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Securities held by employees, officers or directors shall be reduced prior to
any such reduction in the Holder's Registrable Securities. Any partial reduction
in number of Registrable Securities of the Holder to be included in the Follow-
On Registration shall be effected pro rata based on the ratio which the Holder's
requested shares bears to the total number of shares requested to be included in
such Follow-On Registration by all Persons
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other than the Company who have the contractual right to request that their
shares be included in such registration statement and who have requested that
their shares be included. If the Company initiated the registration, for its own
account or for the account of any other Person other than the Holder, then the
Company may include all of those securities in such registration statement
before any of Holder's requested shares are included, subject to the 15% floor
referenced in the first sentence of this Section 7(b). If another security
holder initiated the registration, then the Company may not include any of its
securities in such registration statement unless all Registrable Securities
requested to be included in the registration statement by the Holder are
included in the registration statement. If as a result of the provisions of this
Section 7 the Holder shall not be entitled to include all Registrable Securities
in a registration that the Holder has requested to be so included, the Holder
may withdraw its request to include Registrable Securities in such registration
statement prior to its effectiveness.
8. Expenses of Registration All Registration Expenses incurred in
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connection with any registration, qualification or compliance pursuant to
Sections 5, 6, and 7 shall be borne by the Company. All Selling Expenses
relating to securities registered by the Holder shall be borne by the Holder.
9. Registration Procedures.
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In the case of each registration, qualification or compliance effected by
the Company pursuant to this Agreement the Company will keep Holder advised in
writing as to the initiation of each registration, qualification and compliance
and as to the completion thereof. At its expense the Company will:
(a) prepare and file with the Commission a registration statement
with respect to such securities and use its best efforts to cause such
registration statement to become and remain effective for at least 120 days or
until the distribution described in the registration statement has been
completed; provided, however, that (i) such 120-day period shall be extended for
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a period of time equal to the period the Holder refrains from selling any
securities included in such registration at the request of an underwriter of
securities of the Company; and (ii) in the case of any registration of
Registrable Securities on Form S-3 which are intended to be offered on a
continuous or delayed basis, such 120-day period shall be extended, if
necessary, to keep the registration statement effective until all such
Registrable Securities are sold;
(b) furnish to the Holder and to the underwriters, if any, of the
securities being registered such number of copies of the registration statement,
preliminary prospectus, final prospectus and such other documents as such Holder
or underwriters may reasonably request in order to facilitate the public
offering of such securities;
(c) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
with such registration statement as may be necessary to comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement or to applicable anti-fraud
provisions;
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(d) use its best efforts to register and qualify the securities
covered by such registration statement under such other applicable securities or
blue sky laws; provided that, the Company shall not be required in connection
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therewith or as a condition thereto to qualify to do business or to file a
general consent to service of process in any such states or jurisdictions unless
the Company is already subject to service in such jurisdiction and except as may
be required by the Securities Act;
(e) cause all such Registrable Securities which are Common Stock
registered pursuant hereunder to be listed on each securities exchange on which
similar securities issued by the Company are then listed;
(f) provide a transfer agent and registrar for all Registrable
Securities which are Common Stock registered pursuant to such registration
statement and a CUSIP number for all such Registrable Securities, in each case
not later than the effective date of such registration;
(g) if applicable, enter into an underwriting agreement in form
reasonably necessary to effect the offer and sale of Registrable Securities;
(h) notify Holder covered by such registration statement at any time
when a prospectus relating thereto is required to be delivered under the
Securities Act of the happening of any event as a result of which the prospectus
included in such registration statement, as then in effect, includes an untrue
statement of a material fact or omits to state a material fact required to be
stated therein or necessary to make the statements therein not misleading in the
light of circumstances then existing;
(i) make available for inspection by the Holder and any attorney,
accountant or other professional retained thereby (collectively, the
"Inspectors"), all financial and other records, pertinent corporate documents
and properties of the Company (collectively, the "Records") as shall be
reasonably necessary to enable them to exercise their due diligence
responsibility, and cause the Company's officers, directors and employees to
supply all information reasonably requested by any such Inspectors in connection
with such Registration Statement; provided that the Company shall not be
required to make such information available to more than one law firm on behalf
of the Holder.
use its best efforts to furnish, at the request of Holder requesting
registration of Registrable Securities pursuant to this Section 9, on the date
that such Registrable Securities are delivered to the underwriters for sale in
connection with a registration pursuant to this Section 9, if such securities
are being sold through underwriters, or, if such securities are not being sold
through underwriters, on the date that the registration statement with respect
to such securities becomes effective, (i) an opinion, dated such date, of the
counsel representing the Company for the purposes of such registration, in form
and substance as is customarily given to underwriters in an underwritten public
offering, addressed to the underwriters, if any, and to the Holders requesting
registration of Registrable Securities and (ii) a "comfort" letter, dated as of
such date, from the independent certified public accountants of the Company, in
form and substance as is customarily given by independent certified public
accountants to underwriters in an underwritten public offering and
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reasonably satisfactory to a majority in interest of the Holder, addressed to
the underwriters, if any, and the Holder.
10. Termination of Registration Rights.
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The registration rights granted pursuant to this Agreement shall terminate
as to any Holder, at the earlier of (i) the time as such Holder is able to sell
all Registrable Securities held by it in a single transaction pursuant to Rule
144 promulgated under the Securities Act or (ii) five (5) years after the
Effective Date.
11. Lock-up Agreement
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In consideration for the Company agreeing to its obligations under this
Agreement Holder and each transferee pursuant to Section 4 hereof agrees, upon
request of the Company or the underwriters managing any underwritten offering of
the Company's securities, not to sell, make any short sale of, loan, grant any
option for the purchase of, or otherwise dispose of any Registrable Securities
(other than those included in the registration) without the prior written
consent of the Company or such underwriters, as the case may be, for 180 days
from the effective date of the applicable underwritten offering; provided,
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however, that all executive officers and directors of the Company must enter
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into similar lock-up agreements as well. Each Holder agrees that the Company may
instruct its transfer agent to place stop transfer notations in its records to
enforce the provisions of this Section 11.
12. Information by Holder.
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The Holder included in any registration shall furnish to the Company such
information regarding such Holder and the distribution proposed by such Holder
as the Company may reasonably request in writing and as shall be reasonably
required to effect the registration of such Holder's Registrable Securities in
connection with any registration, qualification or compliance referred to in
this Agreement.
13. Indemnification.
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(a) The Company will indemnify Holder, each of its officers,
directors and partners, members, legal counsel, accountants and each person
controlling such Holder within the meaning of Section 15 of the Securities Act,
with respect to which registration, qualification or compliance has been
effected pursuant to this Agreement, and each underwriter, if any, and each
person who controls any underwriter within the meaning of Section 15 of the
Securities Act, against all expenses, claims, losses, damages and liabilities
(or actions in respect thereof), including any of the foregoing incurred in
settlement of any litigation, arising out of or based on any untrue statement
(or alleged untrue statement) of a material fact contained in any registration
statement, prospectus, offering circular or other document, or any amendment or
supplement thereto, incident to any such registration, qualification or
compliance, or based on any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein, not misleading, or any violation by the Company of the Securities Act
or any rule or regulation promulgated thereunder applicable to the Company and
relating to action or inaction required of the
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Company in connection with any such registration, qualification or compliance,
and will reimburse each such Holder, each of its officers, directors, partners
and members and each person controlling such Holder, each such underwriter and
each person who controls any such underwriter, for any legal and any other
expenses reasonably incurred in connection with investigating, preparing or
defending any such claim, loss, damage, liability or action; provided that, the
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Company will not be liable in any such case to the extent that any such claim,
loss, damage, liability or expense arises out of or is based on any untrue
statement or omission or alleged untrue statement or omission, made in reliance
upon and in conformity with written information furnished to the Company by an
instrument duly executed by such Holder or underwriter and stated to be
specifically for use therein.
(b) Holder will, if Registrable Securities held by such Holder are
included in the securities as to which such registration, qualification or
compliance is being effected, indemnify the Company, each of its directors and
officers, each underwriter, if any, of the Company's securities covered by such
a registration statement, each person who controls the Company or such
underwriter within the meaning of Section 15 of the Securities Act, against all
claims, losses, damages and liabilities (or actions in respect thereof) arising
out of or based on any untrue statement (or alleged untrue statement) of a
material fact contained in any such registration statement, prospectus, offering
circular or other document, or any omission (or alleged omission) to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, and will reimburse the Company, such
directors, officers, underwriters or control persons for any legal or any other
expenses reasonably incurred in connection with investigating or defending any
such claim, loss, damage, liability or action, in each case to the extent, but
only to the extent, that such untrue statement (or alleged untrue statement) or
omission (or alleged omission) is made in such registration statement,
prospectus, offering circular or other document in reliance upon and in
conformity with written information furnished to the Company by an instrument
duly executed by Holder and stated to be specifically for use therein; provided,
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however, that the obligations of Holder hereunder shall not apply to amounts
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paid in settlement of any such claims, losses, damages or liabilities (or
actions in respect thereof) if such settlement is effected without the consent
of Holder; and provided further that the obligations of Holder hereunder shall
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be limited to an amount equal to the net proceeds after expenses and commissions
received by Holder from Registrable Securities sold in such offering by Holder.
(c) Each party entitled to indemnification under this Section 13 (the
"Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought, and shall
permit the Indemnifying Party to assume the defense of any such claim or any
litigation resulting therefrom; provided that, counsel for the Indemnifying
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Party, who shall conduct the defense of such claim or litigation, shall be
approved by the Indemnified Party (whose approval shall not be unreasonably
withheld), and the Indemnified Party may participate in such defense at such
Party's expense; and provided further that the failure of any Indemnified Party
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to give notice as provided herein shall not relieve the Indemnifying Party of
its obligations under this Agreement, except to the extent, but only to the
extent, that the Indemnifying Party's ability to defend against such claim or
litigation is impaired as a result of such failure to give notice. No
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Indemnifying Party, in the defense of any such claim or litigation, shall,
except with the consent of each 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.
14. Rule 144 Reporting. With a view to making available the benefits of
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certain rules and regulations of the Commission which may at any time permit the
sale of the Restricted Securities to the public without registration, the
Company agrees to:
(a) make and keep public information available, as those terms are
understood and defined in Rule 144 under the Securities Act, at all times after
the effective date of the first registration under the Securities Act filed by
the Company for an offering of its securities to the general public;
(b) file with the Commission in a timely manner all reports and other
documents required of the Company under the Securities Act and the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), at any time after it has
become subject to such reporting requirements; and
(c) so long as any of the Holder owns Restricted Securities, furnish
to Holder of Registrable Securities forthwith upon written request, a written
statement by the Company as to its compliance with the reporting requirements of
Rule 144 (at any time after 90 days after the effective date of the first
registration statement filed by the Company for an offering of its securities to
the general public), and of the Securities Act and the Exchange Act (at any time
after it has become subject to such reporting requirements), a copy of the most
recent annual or quarterly report of the Company, and such other reports and
documents of the Company as the Holder may reasonably request in availing itself
of any rule or regulation of the Commission allowing such Holder to sell any
such securities without registration.
15. Transfer of Registration Rights. The right to cause the Company to
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register securities granted hereunder may be assigned by Holder to a transferee
or assignee who acquires the lesser of (i) all of such Holder's Registrable
Securities or (ii) 450,000 shares of Registrable Securities (as adjusted for
stock splits, stock dividends and the like); provided that, the Company is given
--------
written notice of such assignment at the time of or within a reasonable time
after said transfer or assignment, and the transferee agrees in writing to be
bound by the provisions of this Agreement regarding the right to register
securities; provided further, Holder may assign its rights under this Agreement
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to a wholly-owned Affiliate of Holder upon the Transfer of Restricted Securities
to such wholly-owned Affiliate, irrespective of the number of shares acquired by
such Affiliate.
16. Subsequent Grant of Registration Rights. After the date hereof, the
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Company shall not grant rights to have securities other than the Registrable
Securities registered under the Securities
11
Act if such rights would be superior to the registration rights granted herein
without the written consent of the Holder.
17. Arbitration.
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(a) Disputes. Within fifteen (15) days of the written request of
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either Party, the Parties shall meet to negotiate in good faith a resolution of
any dispute, claim, controversy or claim arising out of or relating to this
Agreement or the subject matter of this Agreement, or the breach, termination or
invalidity thereof (a "Dispute").
(b) Arbitration. Any Dispute which cannot be resolved pursuant to
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Section 17(a) above within twenty (20) days of the written request provided
pursuant to Section 17(a) , will be finally settled by arbitration before a sole
arbitrator in accordance with the Commercial Rules of Arbitration of the
American Arbitration Association in effect on the date of this Agreement. The
arbitrator shall be appointed in accordance with the applicable rules of
arbitration. The arbitrator shall be an individual with significant experience
in the aircraft maintenance sector.
(c) Timing and Location of Arbitration. The Parties agree that any
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arbitration process related to this Agreement shall be structured to the fullest
extent possible in accordance with the applicable arbitration rules in such a
way as to enable a decision to be rendered by the arbitrators within ninety (90)
days of the date of the commencement of such arbitration. The place of
arbitration will be Salt Lake City, Utah. By this agreement to arbitrate, the
Parties waive their right to any form of appeal or recourse to a court of law or
other judicial authority, to the fullest extent permitted by law, provided that
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any judgment upon an award rendered by the arbitrator may be entered in any
court having jurisdiction therefore.
(d) Confidentiality; Expenses.
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(i) The parties shall keep the arbitration confidential and
shall not disclose to any Person, other than those necessary to the proceedings,
the existence of the arbitration, any document submitted or exchanged in
connection with it, any oral submissions or testimony, transcripts, or any award
unless disclosure is required by law or is necessary to challenge, recognize or
enforce an award. The arbitrators and any experts shall be required to agree to
comply with this confidentiality provision accepting appointment.
All expenses of the arbitration procedure and tribunal will be borne
equally by the Parties, or as otherwise prescribed by the applicable arbitration
rules. Each Party's expenses with respect to the conduct of the arbitration,
including the fees of attorneys, accountants, or other experts used in
connection with the arbitration, will be borne by the unsuccessful party in the
arbitration, in whole or in part as determined by the arbitration tribunal.
18. Miscellaneous.
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12
(a) Severability. If any term, provision, covenant or restriction of
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this Agreement is held to be invalid, void or unenforceable, such provision
shall be amended by the Parties only to the extent necessary to be enforceable
consistent with the Parties' intent, and the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain in full force and
effect, unless such action would substantially impair the benefits to any Party
of the remaining provisions of this Agreement.
(b) Specific Performance.. The Parties each acknowledge and agree
--------------------
that irreparable damage would occur in the event that any of the provisions of
this Agreement were not performed in accordance with their specific terms or
were otherwise breached. It is accordingly agreed that the Parties shall be
entitled to preliminary relief to prevent or cure breaches of the provisions of
this Agreement and to enforce specifically the terms and provisions hereof, this
being in addition to any other remedy to which they may be entitled by law or
equity.
(c) Entire Agreement; Amendments.. This Agreement and the other
----------------------------
documents and instruments referred to herein contain the entire understanding of
the Parties with respect to the matters covered hereby and supersede all other
prior agreements and understandings, both written and oral, among the Parties or
any of them, with respect to the subject matter hereof. This Agreement may be
amended only by an instrument in writing executed by the Parties.
(d) Notices.
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(i) All notices, requests, demands, and other communications
provided in this Agreement shall be in writing and shall be deemed given if
delivered personally, transmitted by facsimile (receipt confirmed), sent by
internationally recognized overnight courier service, to the parties at the
following addresses (or at such other address for a party as shall be specified
by like notice, provided that notices of a change of address shall be effective
only on receipt of such notice):
if to the Holder to:
Lufthansa Technik AG
Weg beim Jager 193D-
▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Fax: ▇▇▇ ▇▇ ▇▇ ▇▇▇▇ ▇▇▇▇
with a copy to:
▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Fax: ▇▇▇ ▇▇▇ ▇▇▇▇
13
if to the Company to:
Hawker Pacific Aerospace
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇
Attention: Chief Financial Officer
Fax: ▇▇▇ ▇▇▇ ▇▇▇▇
All notices, requests, demands, and other communications shall be deemed to have
been given as of the date so delivered or telefaxed and, if given by any other
means, shall be deemed given only when actually received by the addressees.
(e) Waivers. No waiver by either Party of any default with respect
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to any provision, condition or requirement hereof shall be deemed to be a
continuing waiver in the future thereof or a waiver of any other provision,
condition or requirement hereof; nor shall any delay or omission of either Party
to exercise any right hereunder in any manner impair the exercise of any such
right accruing to it thereafter.
(f) Headings; Interpretation. The headings herein are for
------------------------
convenience only, do not constitute a part of this Agreement and shall not be
deemed to limit or affect any of the provisions hereof. All references to
sections, articles, Exhibits or Schedules shall mean the sections, articles,
Exhibits or Schedules of this Agreement. Terms used with initial capital letters
shall have the meanings specified, applicable to both singular and plural forms,
for all purposes of this Agreement. The words "include" and "exclude" and
derivatives of those words are used in this Agreement in an illustrative sense
rather than a limiting sense.
(g) Successors and Assignees. Except as otherwise expressly provided
------------------------
herein, this Agreement shall be binding upon and inure to the benefit of the
Parties and their successors and permitted assigns. Holder may assign this
Agreement and any rights or obligations pursuant to Section 4. The Company may
not assign this Agreement nor any of the rights or obligations hereunder without
the prior written consent of the Holder.
(h) No Third Party Beneficiaries. This Agreement is intended for the
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benefit of the Parties hereto, and their respective permitted successors and
assigns and is not for the benefit of, nor may any provision hereof be enforced
by, any other Person.
(i) Counterparts. This Agreement may be executed in two
------------
counterparts, all of which shall be considered one and the same agreement and
shall become effective when counterparts have been signed by each Party and
delivered to the other Party, it being understood that all Parties need not sign
the same counterpart.
14
(j) Governing Law. This Agreement shall be governed by and construed
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and enforced in accordance with the laws of California, without regard to the
conflicts of laws principles thereof.
(signature page follows)
15
IN WITNESS WHEREOF, the undersigned have executed this Registration Rights
Agreement as of the date first set forth above.
COMPANY:
HAWKER PACIFIC AEROSPACE
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: CEO
Holder:
LUFTHANSA TECHNIK AG
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Name: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: General Counsel
ANNEX I
DEFINITIONS
"Action or Proceeding" means any action, suit, arbitration, proceeding or
Governmental Entity investigation or audit.
"Affiliate" shall mean, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under direct or indirect
common control with such Person. For purposes of this definition, a Person shall
be deemed to control another Person if it possesses, directly or indirectly, the
power to direct or cause the direction of the management and policies of such
other Person, whether through ownership of voting securities, by contract or
otherwise, or the power to elect at least 50% of the directors, managers,
general partners, or persons exercising similar authority with respect to such
Person.
"Business Day" means a day other than (i) Saturday, (ii) Sunday, or (iii)
any day on which banks located in New York, New York or Hamburg, Germany are
generally closed.
"Commission" shall mean the Securities and Exchange Commission or any
successor agency.
"Common Stock" shall mean the common stock, par value $0.01 per share, of
the Company.
"Demand Registration" has the meaning set forth in Section 5 hereof.
"Exchange Act" shall have the meaning set forth in Section 14(b) hereof.
"Follow-On Registrations" has the meaning set forth in Section 7 hereof.
"Governmental Entity" means any court or tribunal or administrative,
governmental or regulatory body, agency, commission, division, department,
public body or other authority.
"Indemnified Party" has the meaning set forth in Section 13 hereof.
"Indemnifying Party" has the meaning set forth in Section 13 hereof.
"Inspectors" has the meaning set forth in Section 9 hereof.
"Material Adverse Effect" means, with respect to the Company, a material
adverse effect on the business, prospects, assets, liabilities, revenues, costs
and expenses, income before provision for income taxes, operations or condition,
financial or otherwise, of the Company. In determining whether any individual
event would result in a Material Adverse Effect, notwithstanding that such event
does not of itself have such effect, a Material Adverse Effect shall be deemed
to have occurred if the cumulative effect of such event and all other then
existing events could reasonably be expected to result in a Material Adverse
Effect.
"Order" means any writ, judgment, decree, injunction or similar order of
any Governmental Entity (in each case whether preliminary or final).
"Parties" shall mean the Company and Holder.
"Person" means and includes any individual, partnership, joint venture,
corporation, trust, limited liability company, joint stock company, an
unincorporated organization, a Governmental Entity or any political subdivision
or agency thereof, or any other entity.
"Piggyback Registration" has the meaning set forth in Section 6 hereof.
"Records" has the meaning set forth in Section 9 hereof.
"Restricted Securities" shall mean the securities of the Company required
to bear the legend set forth in Section 3 hereof (or any similar legend).
"Registrable Securities" shall mean (i) shares of the Company's capital
stock held by Holder on the date hereof or acquired hereafter, including any
securities convertible into Common Stock; (ii) any capital stock of the Company
or other securities issued or issuable in respect of capital stock referred to
in clause (i) above, including without limitation any capital stock issued in
connection with a merger with or into another company; and (iii) shares of the
Company's capital stock or other securities issued or issuable in respect of the
capital stock described in clause (i) or (ii) upon any stock split, stock
dividend, recapitalization, or similar event; provided, however, that any
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capital stock described in clauses (i)-(iii) above which have been resold to the
public shall cease to be Registrable Securities upon such resale.
The terms "register," "registered" and "registration" refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act, and the declaration or ordering of the
effectiveness of such registration statement.
"Registration Expenses" shall mean all expenses incurred by the Company in
complying with Sections 5, 6, and 7 hereof, including, without limitation, all
registration, qualification and filing fees, printing expenses, escrow fees,
fees and disbursements of counsel for the Company, blue sky fees and expenses
and the expense of any special audits incident to or required by any such
registration.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Selling Expenses" shall mean all underwriting discounts, selling
commissions and stock transfer taxes applicable to the securities registered by
the Holder and the legal expenses of counsel to the Holder, except that the
Company shall pay the legal expenses of one counsel for the Holder and such
expenses shall not be deemed Selling Expenses.
"Shareholders Rights Agreement" shall mean that certain shareholders rights
and voting agreement of even date herewith entered into by and among the
Company, the Holder, and certain shareholders named therein.
"Transfer" means, as a noun, any voluntary or involuntary transfer, sale,
pledge or hypothecation or other disposition, and as a verb, voluntarily or
involuntarily to transfer, sell, pledge or hypothecate or otherwise dispose of.