AMENDED AND RESTATED Exhibit 10.2
INVESTORS' AGREEMENT
dated as of
October 6, 2000
by and among
▇▇▇▇▇▇▇ HOLDINGS CO.,
▇▇▇▇▇▇▇ AIRCRAFT HOLDINGS, INC.
DLJ MERCHANT BANKING PARTNERS II, L.P.,
DLJ MERCHANT BANKING PARTNERS ▇▇-▇, ▇.▇.,
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇, ▇.▇.,
▇▇▇ DIVERSIFIED PARTNERS, L.P.
DLJ DIVERSIFIED PARTNERS-A, L.P.,
DLJ MILLENNIUM PARTNERS, L.P.
DLJ MILLENNIUM PARTNERS-A, L.P.
DLJMB FUNDING II, INC.,
UK INVESTMENT PLAN 1997 PARTNERS,
DLJ EAB PARTNERS, L.P.,
DLJ FIRST ESC L.P.,
DLJ ESC II L.P.
DLJ INVESTMENT PARTNERS, ▇.▇.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇, ▇.▇.
▇▇▇ INVESTMENT FUNDING II, INC.
and certain other Stockholders named herein
TABLE OF CONTENTS
PAGE
ARTICLE 1
Definitions
SECTION 1.01. Definitions....................................................................2
ARTICLE 2
Corporate Governance
SECTION 2.01. Composition of the Board......................................................11
SECTION 2.02. Removal.......................................................................11
SECTION 2.03. Vacancies.....................................................................11
SECTION 2.04. Meetings......................................................................11
SECTION 2.05. Action by the Board...........................................................11
SECTION 2.06. Board Observer................................................................12
SECTION 2.07. Conflicting Charter or Bylaw Provisions.......................................13
ARTICLE 3
Restrictions On Transfer
SECTION 3.01. General.......................................................................14
SECTION 3.02. Legends.......................................................................14
SECTION 3.03. Permitted Transferees.........................................................15
SECTION 3.04. Restrictions on Transfers by Management Stockholders..........................15
SECTION 3.05. Restrictions on Transfers by the Investors, the DLJIP
Entities and the ▇▇▇▇▇▇ Entities........................................16
ARTICLE 4
Tag-Along Rights; Drag-Along Rights
SECTION 4.01. Rights to Participate in Transfer.............................................17
SECTION 4.02. Right to Compel Participation in Certain Transfers............................18
SECTION 4.03. Certain Rights................................................................19
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PAGE
ARTICLE 5
Registration Rights
SECTION 5.01. Demand Registration...........................................................20
SECTION 5.02. Incidental Registration.......................................................23
SECTION 5.03. Holdback Agreements...........................................................24
SECTION 5.04. Registration Procedures.......................................................25
SECTION 5.05. Indemnification by the Company................................................28
SECTION 5.06. Indemnification by Participating Stockholders.................................29
SECTION 5.07. Conduct of Indemnification Proceedings........................................29
SECTION 5.08. Contribution..................................................................30
SECTION 5.09. Participation in Public Offering..............................................32
SECTION 5.10. Other Indemnification.........................................................32
SECTION 5.11. Cooperation by the Company....................................................32
ARTICLE 6
Miscellaneous
SECTION 6.01. Entire Agreement..............................................................33
SECTION 6.02. Binding Effect; Benefit.......................................................33
SECTION 6.03. Exclusive Financial and Investment Banking Advisor............................33
SECTION 6.04. Assignability.................................................................33
SECTION 6.05. Amendment; Waiver; Termination................................................34
SECTION 6.06. Notices.......................................................................34
SECTION 6.07. Headings......................................................................36
SECTION 6.08. Counterparts..................................................................37
SECTION 6.09. Applicable Law................................................................37
SECTION 6.10. Specific Enforcement..........................................................37
SECTION 6.11. Consent to Jurisdiction.......................................................37
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AMENDED AND RESTATED
INVESTORS' AGREEMENT
AMENDED AND RESTATED INVESTORS' AGREEMENT dated as of October 6, 2000
(the "AGREEMENT") among (i) ▇▇▇▇▇▇▇ Holdings Co., a Delaware corporation (the
"COMPANY") and ▇▇▇▇▇▇▇ Aircraft Holdings, Inc., a Delaware corporation and
subsidiary of the Company ("OPCO"); (ii) DLJ Merchant Banking Partners II, L.P.,
a Delaware limited partnership, DLJ Offshore Partners II, C.V., a Netherlands
Antilles limited partnership, DLJ Merchant Banking Partners II-A, L.P., a
Delaware limited partnership, DLJ Diversified Partners, L.P., a Delaware limited
partnership, DLJ Diversified Partners-A, L.P., a Delaware limited partnership,
DLJ EAB Partners, L.P., a Delaware limited partnership, DLJ Millennium Partners,
L.P., a Delaware limited partnership, DLJ Millennium Partners-A, L.P., a
Delaware limited partnership, DLJMB Funding II, Inc., a Delaware corporation, UK
Investment Plan 1997 Partners, a Delaware partnership, DLJ First ESC L.P., a
Delaware limited partnership and DLJ ESC II L.P., a Delaware limited partnership
(other than in its capacity as a DLJIP Entity), (each of the foregoing, a "DLJ
ENTITY", and collectively, the "DLJ ENTITIES"); (iii) DLJ Investment Partners,
L.P., a Delaware limited partnership, DLJ Investment Partners II, L.P., a
Delaware limited partnership, DLJ Investment Funding II, Inc., a Delaware
corporation, and DLJ ESC II, L.P., a Delaware limited partnership (solely in its
capacity as a holder of Senior Preferred Stock, DLJIP Warrants and any Company
Securities issued with respect thereto), (each of the foregoing, a "DLJIP
ENTITY", and collectively, the "DLJIP ENTITIES"); (iv) ▇▇▇▇▇▇ High Yield Trust,
a Massachusetts business trust, ▇▇▇▇▇▇ Funds Trust - ▇▇▇▇▇▇ High Yield Trust II,
a Massachusetts business trust, ▇▇▇▇▇▇ High Yield Advantage Fund, a
Massachusetts business trust, Putnam Variable Trust - Putnam VT High Yield Fund,
a Massachusetts business trust, Putnam Strategic Income Fund, a Massachusetts
business trust, and ▇▇▇▇▇▇ Diversified Income Trust, a Massachusetts business
trust (collectively, the "PUTNAM ENTITIES"); and (v) certain other Stockholders
named herein.
W I T N E S S E T H
WHEREAS, (i) the Company, the DLJ Entities and certain other
Stockholders parties thereto have heretofore entered into an Amended and
Restated Investors' Agreement dated as of October 2, 1998 (the "ORIGINAL
AGREEMENT") and (ii) the Company, Opco, the DLJ Entities, the DLJIP Entities and
certain other Stockholders parties thereto have heretofore amended and restated
the Original Agreement as of June 30, 2000 (the "AMENDED AGREEMENT");
WHEREAS, pursuant to the Securities Purchase Agreement (the "PURCHASE
AGREEMENT") dated as of the date hereof among the DLJIP Entities and the ▇▇▇▇▇▇
Entities, the ▇▇▇▇▇▇ Entities are acquiring from the DLJIP Entities (i) shares
of 16% Senior Redeemable Exchangeable Preferred Stock due 2009 of Opco (the
"SENIOR PREFERRED STOCK") and (ii) warrants to purchase common stock of the
Company;
WHEREAS, the parties hereto desire to amend and restate the Amended
Agreement to govern certain of their rights, duties and obligations after
consummation of the transactions contemplated by the Purchase Agreement;
NOW, THEREFORE, in consideration of the covenants and agreements
contained herein and in the Purchase Agreement, the parties hereto agree as
follows:
ARTICLE 1
DEFINITIONS
SECTION 1.1. DEFINITIONS. (a) The following terms, as used
herein, have the following meanings:
"ADVERSE PERSON" means any Person whom the Board determines is a
competitor or a potential competitor of the Company or any of its Subsidiaries
or to whom the Board determines a transfer of Shares would be inadvisable.
"AFFILIATE" means, with respect to any Person, any other Person
directly or indirectly controlling, controlled by, or under common control with
such Person; PROVIDED that no stockholder of the Company shall be deemed an
Affiliate of any other stockholder of the Company solely by reason of any
investment in the Company. For the purpose of this definition, the term
"CONTROL" (including with correlative meanings, the terms "CONTROLLING",
"CONTROLLED BY" and "UNDER COMMON CONTROL WITH"), when used with respect to any
Person, means the possession, directly or indirectly, of the power to direct or
cause the direction of the management and policies of such Person, whether
through the ownership of voting securities, by contract or otherwise.
"AFFILIATED EMPLOYEE BENEFIT TRUST" means any trust that is a
successor to the assets held by a trust established under an employee benefit
plan subject to ERISA or any other trust established directly or indirectly
under such plan or any other such plan having the same sponsor.
"AGGREGATE OWNERSHIP" means, with respect to any Stockholder or group
of Stockholders, and with respect to any class of Company Securities, the total
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number or amount of such class of Company Securities "beneficially owned" (as
such term is defined in Rule 13d-3 under the Exchange Act) (without duplication)
by such Stockholder or group of Stockholders as of the date of such calculation
(but adjusted in accordance with the proviso below), calculated on a Fully
Diluted basis and taking into account any stock dividend, stock split or reverse
stock split; PROVIDED that such number or amount of such class of Company
Securities shall be increased (without duplication) with respect to any
Stockholder, by any stock appreciation rights, options, warrants or other rights
to purchase or subscribe for Common Shares of such Other Stockholder as and when
such stock appreciation rights, options, warrants or other rights have vested.
"BOARD" means the board of directors of the Company.
"BUSINESS DAY" means any day except a Saturday, Sunday or other day on
which commercial banks in New York City are authorized by law to close.
"BYLAWS" means the Bylaws of the Company, as amended from time to time.
"CHANGE OF CONTROL" means:
(a) any "person" or "group of persons" (within the meaning of
Section 13 or 14 of the Exchange Act), other than the DLJ Entities
and/or their respective Permitted Transferees, acquires, directly or
indirectly, by virtue of the consummation of any purchase, merger or
other combination, beneficial ownership (within the meaning of Section
13(d)(3) of the Exchange Act) of securities of the Company representing
more than 51% of the combined voting power of the Company's then
outstanding voting securities with respect to matters submitted to a
vote of the stockholders generally; or
(b) a sale or transfer by the Company or any of its
Subsidiaries of substantially all of the consolidated assets of the
Company and its Subsidiaries to an entity which is not an Affiliate of
the Company prior to such sale or transfer.
"CHARTER" means the Certificate of Incorporation of the Company, as
amended from time to time.
"CLOSING DATE" means August 28, 1998.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COMMON STOCK" means the common stock, par value $0.01 per share,
of the Company and any stock into which such Common Stock may thereafter be
converted or changed, and "COMMON SHARES" means shares of Common Stock.
3
"COMPANY SECURITIES" means the Common Stock and securities
convertible into or exchangeable for Common Stock, the Preferred Stock and
options, warrants (including the Warrants) or other rights to acquire Common
Stock, Preferred Stock or any other equity security issued by the Company.
"DLJIP TRANSFEREE" means any Person to whom DLJIP Warrants, or
Common Shares issued upon exercise of DLJIP Warrants, are transferred in
accordance with the terms of this Agreement, upon execution by such Person of
an agreement to be bound by this Agreement.
"DLJIP WARRANTS" means the warrants issued by the Company to the
DLJIP Entities pursuant to the Securities Purchase Agreement dated as of June
30, 2000 among the Company, Opco and the DLJIP Entities, for the purchase of
an aggregate of 139,357 Common Shares (subject to adjustment as provided for
therein), excluding the ▇▇▇▇▇▇ Warrants.
"DLJ WARRANTS" means the warrants issued by the Company to the DLJ
Entities for the purchase of an aggregate of 155,000 Common Shares (subject
to adjustment as provided for therein).
"DRAG-ALONG PORTION" means, with respect to any Other Stockholder
and any class of Company Securities, the number of such class of Company
Securities beneficially owned by such Other Stockholder on a Fully Diluted
basis multiplied by a fraction, the numerator of which is the number of such
class of Company Securities proposed to be sold by the DLJ Entities on behalf
of the DLJ Entities and the Other Stockholders and the denominator of which
is the total number of such class of Company Securities beneficially owned by
the Stockholders on a Fully Diluted basis.
"ERISA" means the Employee Retirement Income Security Act of 1974,
as amended.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as
amended.
"FULLY DILUTED" means, with respect to Common Stock and without
duplication, all outstanding Common Shares and all Common Shares issuable in
respect of securities convertible into or exchangeable for Common Shares,
stock appreciation rights, options, warrants (including the Warrants) and
other rights to purchase or subscribe for Common Shares or securities
convertible into or exchangeable for Common Shares; PROVIDED that, to the
extent any of the foregoing stock appreciation rights, options, warrants or
other rights to purchase or subscribe for Common Shares are subject to
vesting, the Common Shares subject to vesting shall be included in the
definition of "FULLY DILUTED" only upon and to the extent of such vesting.
4
"INITIAL OWNERSHIP" means, with respect to any Stockholder and any
class of Company Securities, the number of shares or units of such class of
Company Securities beneficially owned (and (without duplication) which such
Persons have the right to acquire from any Person) as of the date such Person
became a party to the Original Agreement, the Amended Agreement or this
Agreement, as the case may be, taking into account any stock split, stock
dividend, reverse stock split or similar event.
"INITIAL PUBLIC OFFERING" means the initial sale after the date
hereof of Registrable Securities pursuant to an effective registration
statement under the Securities Act (other than a registration statement on
Form S-8 or any successor form).
"INVESTORS" means each investor in the Company's equity (other than
the DLJ Entities, the DLJIP Entities, the DLJIP Transferees, the ▇▇▇▇▇▇
Entities, the ▇▇▇▇▇▇ Transferees, the Management Stockholders and their
respective Permitted Transferees), who became or becomes a Stockholder after
the date of the Original Agreement for so long as such investor shall
beneficially own any Company Securities.
"MANAGEMENT STOCKHOLDERS" means each of the members of management of
the Company who became or becomes a Stockholder after the date of the
Original Agreement for so long as such member of management shall
beneficially own any Company Securities.
"OTHER STOCKHOLDERS" means all Stockholders and their respective
Permitted Transferees, other than the DLJ Entities and their respective
Permitted Transferees.
"PERMITTED TRANSFEREE" means:
(i) in the case of any DLJ Entity (A) any other DLJ Entity,
(B) any general or limited partner of any DLJ Entity (a "DLJ PARTNER"),
and any corporation, partnership, Affiliated Employee Benefit Trust or
other entity that is an Affiliate of any DLJ Partner (collectively, the
"DLJ AFFILIATES"), (C) any managing director, director, general
partner, limited partner, officer or employee of any DLJ Entity or of
any DLJ Affiliate, or the heirs, executors, administrators,
testamentary trustees, legatees or beneficiaries of any of the
foregoing persons referred to in this clause (C) (collectively, the
"DLJ ASSOCIATES"), (D) a trust, the beneficiaries of which, or a
corporation, limited liability company or partnership, the
stockholders, members or general or limited partners of which, include
only ▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇ Associates, their spouses or
their lineal descendants or (E) a voting trustee for one or more DLJ
Entities, DLJ Affiliates or DLJ Associates under the terms of a voting
trust
5
designed to conform with the requirements of the Insurance Law of
the State of New York; and
(ii) in the case of any Other Stockholder (A) any Other
Stockholder, (B) a Person to whom Shares are transferred from such
Other Stockholder (1) by will or the laws of descent and distribution
or (2) by gift without consideration of any kind; PROVIDED that, in the
case of clause (2), such transferee is the issue or spouse of such
Other Stockholder or (C) a trust that is for the exclusive benefit of
such Other Stockholder or its Permitted Transferees under (B) above.
"PERSON" means an individual, corporation, limited liability company,
partnership, association, trust or other entity or organization, including a
government or political subdivision or an agency or instrumentality thereof.
"PREFERRED STOCK" means the 14% Senior Redeemable Exchangeable
Preferred Stock, par value $0.01 per share, of the Company, and "PREFERRED
SHARES" means shares of Preferred Stock.
"PRO RATA PORTION" means the number of Common Shares a Stockholder
holds multiplied by a fraction, the numerator of which is the number of Common
Shares to be sold by the DLJ Entities and their Permitted Transferees in a
Public Offering and the denominator of which is the total number of Common
Shares, on a Fully Diluted basis, held in the aggregate by the DLJ Entities and
their Permitted Transferees prior to such Public Offering.
"PUBLIC OFFERING" means any primary or secondary public offering of
Registrable Securities of the Company pursuant to an effective registration
statement under the Securities Act other than pursuant to a registration
statement filed in connection with a transaction of the type described in Rule
145 of the Securities Act or for the purpose of issuing securities pursuant to
an employee benefit plan.
"▇▇▇▇▇▇ TRANSFEREE" means any Person to whom ▇▇▇▇▇▇ Warrants, or Common
Shares issued upon exercise of ▇▇▇▇▇▇ Warrants, are transferred in accordance
with the terms of this Agreement, upon execution by such Person of an agreement
to be bound by this Agreement.
"▇▇▇▇▇▇ WARRANTS" means the warrants purchased by the ▇▇▇▇▇▇ Entities
pursuant to the Purchase Agreement that provide for the purchase of an aggregate
of 27,871.40 Common Shares (subject to adjustment as provided for therein).
"REGISTRABLE SECURITIES" means at any time, with respect to any
Stockholder or its Permitted Transferees, any Shares or Warrants and any
securities issued or issuable in respect of such Shares or Warrants by way of
6
conversion, exchange, stock dividend, split or combination, recapitalization,
merger, consolidation or other reorganization or otherwise until (i) a
registration statement covering such Shares or Warrants has been declared
effective by the SEC and such Shares or Warrants have been disposed of
pursuant to such effective registration statement, (ii) such Shares or
Warrants are sold under circumstances in which all of the applicable
conditions of Rule 144 (or any similar provisions then in force) under the
Securities Act are met or (iii) such Shares or Warrants are otherwise
transferred, the Company has delivered a new certificate or other evidence of
ownership for such Shares or Warrants not bearing the legend required
pursuant to this Agreement and such Shares or Warrants may be resold without
subsequent registration under the Securities Act.
"REGISTRATION EXPENSES" means (i) all registration and filing fees,
(ii) fees and expenses of compliance with securities or blue sky laws
(including reasonable fees and disbursements of counsel in connection with
blue sky qualifications of the Registrable Securities registered), (iii)
printing expenses, (iv) internal expenses of the Company (including, without
limitation, all salaries and expenses of its officers and employees
performing legal or accounting duties), (v) reasonable fees and disbursements
of counsel for the Company and customary fees and expenses for independent
certified public accountants retained by the Company (including expenses
relating to any comfort letters or costs associated with the delivery by
independent certified public accountants of any comfort letter requested
pursuant to Section 5.04(h) hereof), (vi) the reasonable fees and expenses of
any special experts retained by the Company in connection with the applicable
registration, (vii) reasonable fees and expenses of up to one counsel for the
Stockholders participating in the offering selected (A) by the DLJ Entities,
in the case of any offering in which such entities participate, or (B) in any
other case, by the Other Stockholders holding the majority of the Shares or
Warrants to be sold for the account of all Other Stockholders in the
offering, (viii) fees and expenses in connection with any review of
underwriting arrangements by the National Association of Securities Dealers,
Inc. (the "NASD"), including fees and expenses of any "QUALIFIED INDEPENDENT
UNDERWRITER", and (ix) fees and disbursements of underwriters customarily
paid by issuers or sellers of securities; but shall not include any
underwriting fees, discounts or commissions attributable to the sale of
Registrable Securities, or any out-of-pocket expenses (except as set forth in
clause (vii) above) of the Stockholders (or the agents who manage their
accounts) or any fees and expenses of underwriter's counsel.
"REQUISITE DLJIP ENTITIES" means holders of 50% of the Common Shares
(and any securities issued or issuable in respect of such Common Shares by
way of conversion, exchange, stock dividend, split or combination,
recapitalization, merger, consolidation or other reorganization or otherwise)
issued or issuable upon exercise of the DLJIP Warrants.
7
"RESTRICTION TERMINATION DATE" means the earlier to occur of (a) the
second anniversary of the Initial Public Offering and (b) the fifth
anniversary of the Closing Date.
"SEC" means the Securities and Exchange Commission.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SHARES" means the Common Shares and the Preferred Shares.
"SHELF REGISTRATION" means a shelf registration statement filed
under Rule 415 under the Securities Act.
"STOCKHOLDER" means each Person (other than the Company) who shall
be a party to or bound by this Agreement, whether in connection with the
execution and delivery hereof as of the date of the Original Agreement,
pursuant to Section 6.04 or otherwise, so long as such Person shall
beneficially own any Company Securities.
"SUBSIDIARY" means, with respect to any Person, any entity of which
ownership interests having ordinary voting power to elect a majority of the
board of directors or other Persons performing similar functions are at the
time directly or indirectly owned by such Person.
"TAG-ALONG PORTION" means with respect to any Tagging Person or the
Selling Person, as the case may be:
(i) where the Selling Person is selling Common Shares, the number of
Common Shares beneficially owned by such Tagging Person or the Selling
Person, as the case may be, on a Fully Diluted Basis multiplied by a
fraction, the numerator of which is the number of Common Shares proposed to
be sold in the Tag-Along Sale pursuant to Section 4.01 and the denominator of
which is the aggregate number of Common Shares beneficially owned by all
Stockholders on a Fully Diluted basis,
(ii) where the Selling Person is selling Preferred Shares, the
number of Preferred Shares beneficially owned by such Tagging Person or the
Selling Person, as the case may be, multiplied by a fraction, the numerator
of which is the number of Preferred Shares proposed to be sold in the
Tag-Along Sale pursuant to Section 4.01 and the denominator of which is the
aggregate number of Preferred Shares beneficially owned by all Stockholders,
and
(iii) where the Selling Person is selling Warrants, the number of
Common Shares beneficially owned (or, without duplication, acquirable under
the Warrants) by such Tagging Person or the Selling Person, as the case may
be, on a Fully Diluted Basis multiplied by a fraction, the numerator of which
is the number
8
of Common Shares for which the Warrants proposed to be sold in the Tag-Along
Sale pursuant to Section 4.01 are exercisable and the denominator of which is
the aggregate number of Common Shares beneficially owned by the Stockholders
on a Fully Diluted Basis; PROVIDED that, where a Tag-Along Right includes the
right to sell Common Stock, any holder of Warrants may, in lieu of exercising
such Warrants, transfer such Warrants for some or all of that number of
Common Shares as would otherwise have constituted its Tag-Along Portion, in
which event the price to be received with respect to each such Warrant shall
be the price per Common Share applicable to the Tag-Along Offer, less the
then applicable exercise price of the Warrants owned by such holder.
"THIRD PARTY" means a prospective purchaser of Company Securities in
an arm's-length transaction from a Stockholder where such purchaser is not a
Permitted Transferee of such Stockholder.
"UNDERWRITTEN PUBLIC OFFERING" means a firmly underwritten Public
Offering.
"WARRANTS" means the DLJ Warrants, the DLJIP Warrants and the ▇▇▇▇▇▇
Warrants.
(b) The term "DLJ ENTITIES", to the extent such entities shall
have transferred any of their Shares to "Permitted Transferees", shall
mean the DLJ Entities and the Permitted Transferees of the DLJ
Entities, taken together, and any right or action that may be taken at
the election of the DLJ Entities may be taken at the election of the
DLJ Entities and such Permitted Transferees.
(c) The term "OTHER STOCKHOLDERS", to the extent such
stockholders shall have transferred any of their Company Securities to
"Permitted Transferees", shall mean the Other Stockholders and the
Permitted Transferees of the Other Stockholders, taken together, and
any right or action that may be taken at the election of the Other
Stockholders may be taken at the election of the Other Stockholders and
such Permitted Transferees.
(d) Each of the following terms is defined in the Section set forth
opposite such term:
TERM SECTION
Agreement recitals
Amended Agreement recitals
Applicable Holdback Period 5.03
Black Out Notice 5.04
Black Out Period 5.01
9
TERM SECTION
Company recitals
Demand Registration 5.01(a)
DLJ Entities recitals
DLJIP Entities recitals
DLJMB 2.01
DLJSC 6.03
Drag-Along Rights 4.02(a)
Holders 5.01(a)(ii)
Incidental Registration 5.02(a)
Indemnified Party 5.07
Indemnifying Party 5.07
Independent Director 2.01(a)
Inspectors 5.04(g)
Maximum Offering Size 5.01(e)
Nominee 2.03(a)
Opco recitals
Original Agreement recitals
Public Offering Limitation 3.04(a)
Purchase Agreement recitals
▇▇▇▇▇▇ Entities recitals
Records 5.04(g)
Section 4.01 Response Notice 4.01(a)
Section 4.02 Notice 4.02(a)
Section 4.02 Notice Period 4.02(a)
Section 4.02 Sale 4.02(a)
Section 4.02 Sale Price 4.02(a)
Selling Person 4.01(a)
Selling Stockholder 5.01(a)
Senior Preferred Stock recitals
Tag-Along Notice 4.01(a)
Tag-Along Notice Period 4.01(a)
Tag-Along Offer 4.01(a)
Tag-Along Right 4.01(a)
Tag-Along Sale 4.01(a)
Tagging Person 4.01(a)
transfer 3.01(a)
10
ARTICLE 2
CORPORATE GOVERNANCE
SECTION 2.1. COMPOSITION OF THE BOARD. (a) The Board shall consist
initially of six directors, all of whom shall be designated by DLJ Merchant
Banking Partners II, L.P. ("DLJMB") and one of whom shall not be either an
"Affiliate" or an "Associate" (as such terms are used within the meaning of Rule
12b-2 under the Exchange Act) of any of the DLJ Entities (the "INDEPENDENT
DIRECTOR").
(b) Each Stockholder entitled to vote for the election of directors to
the Board agrees that it will vote its Common Shares or execute written
consents, as the case may be, and take all other necessary action (including
causing the Company to call a special meeting of stockholders) in order to
ensure that the composition of the Board is as set forth in this Section 2.01.
SECTION 2.2. REMOVAL. Each Stockholder agrees that if, at any time, it
is then entitled to vote for the removal of directors of the Company, it will
not vote any of its Common Shares in favor of the removal of any director who
shall have been designated or nominated pursuant to Section 2.01 unless such
removal shall be for cause or the Persons entitled to designate or nominate such
director shall have consented to such removal in writing.
SECTION 2.3. VACANCIES. If, as a result of death, disability,
retirement, resignation, removal (with or without cause) or otherwise, there
shall exist or occur any vacancy of the Board:
(a) the Person or Persons entitled under Section 2.01 to designate or
nominate such director whose death, disability, retirement, resignation or
removal resulted in such vacancy may designate another individual (the
"NOMINEE") to fill such capacity and serve as a director of the Company; and
(b) each Stockholder then entitled to vote for the election of the
Nominee as a director of the Company agrees that it will vote its Common Shares,
or execute a written consent, as the case may be, in order to ensure that the
Nominee is elected to the Board.
SECTION 2.4. MEETINGS. The Board shall hold a regularly scheduled
meeting at least once every fiscal quarter.
SECTION 2.5. ACTION BY THE BOARD. (a) A quorum of the Board shall
consist of three directors. All actions of the Board shall require the
affirmative vote of at least a majority of the directors present at a duly
convened meeting of the Board at which a quorum is present or the unanimous
written consent of the Board; PROVIDED that, in the event there is a vacancy on
the Board and an
11
individual has been nominated to fill such vacancy, the first order of
business shall be to fill such vacancy.
(b) The Board may create executive, compensation and audit
committees, as well as such other committees as it may determine.
SECTION 2.6. BOARD OBSERVER. (a) So long as the DLJIP Entities shall
beneficially own in aggregate at least 51% of the number of shares of the
Senior Preferred Stock beneficially owned by them as of the date of the
Amended Agreement, (i) the Company shall give DLJ Investment Partners II,
L.P. written notice of each meeting of the Board and each committee thereof
at the same time and in the same manner as notice is given to the directors,
(ii) the Company will permit one representative of the DLJIP Entities (a
"BOARD REPRESENTATIVE") to attend and fully participate in all meetings of
the Board and all committees thereof and (iii) the Company shall consult with
the Board Representative with respect to any fundamental change in the nature
of the Company's business; PROVIDED that the Board Representative shall have
no right to vote on any resolutions or other matters upon which members of
the Board may vote; and PROVIDED FURTHER that in the case of telephonic
meetings conducted in accordance with the Company's bylaws and applicable
law, the Board Representative shall be given the opportunity to listen and
fully participate in such telephonic meeting. The Board Representative shall
also be provided with all written materials and other information (including,
without limitation, copies of minutes of meetings) given to directors in
connection with such meetings at the same time such materials and information
are given to the directors. If the Company proposes to take any action by
written consent in lieu of a meeting of the Board or any committee thereof,
the Company shall give written notice thereof to the Board Representative
promptly following the effective date of such consent describing in
reasonable detail the nature and substance of such action. The Company shall
pay the reasonable out-of-pocket expenses of the Board Representative
incurred in connection with attending such board and committee meetings.
(b) So long as the DLJIP Entities shall beneficially own in
aggregate at least 51% of the number of shares of the Senior Preferred Stock
beneficially owned by them as of the date of the Amended Agreement, at any
reasonable time during normal business hours and from time to time, but not
more frequently than once in any six-month period, upon five (5) days written
notice, the Company will permit any one or more of the DLJIP Entities to
examine the books and records of the Company; PROVIDED that the DLJIP
Entities shall use all reasonable efforts to ensure that any such examination
or visit results in a minimum of disruption to the operations of the Company.
(c) Prior to receiving any written information or materials referred
to in Section 2.06(a), attending any meetings of the Board or any of its
committees, or examining any books or records pursuant to Section 2.06(b),
each of the DLJIP
12
Entities shall be required to execute a confidentiality agreement in form and
substance satisfactory to the Company and the DLJIP Entities and shall agree
to use any such materials or information only for the purpose of evaluating
and monitoring the investment of the DLJIP Entities in the Company and Opco
and otherwise in compliance with applicable law.
(c) Notwithstanding anything in this Agreement to the contrary, the
DLJIP Entities may not assign their rights under this Section 2.06 to any other
Person.
SECTION 2.7. CONFLICTING CHARTER OR BYLAW PROVISIONS. Each Stockholder
shall vote its Common Shares or execute written consents, as the case may be,
and take all other actions necessary, to ensure that the Company's Charter and
Bylaws facilitate and do not at any time conflict with any provision of this
Agreement.
13
ARTICLE 3
RESTRICTIONS ON TRANSFER
SECTION 3.1. GENERAL. (a) Each Stockholder understands and agrees that
the Company Securities purchased pursuant to the applicable subscription
agreement have not been registered under the Securities Act and are restricted
securities. Each Stockholder agrees that it will not, directly or indirectly,
sell, assign, transfer, grant a participation in, pledge or otherwise dispose of
("TRANSFER") any Company Securities (or solicit any offers to buy or otherwise
acquire, or take a pledge of any Company Securities) except in compliance with
the Securities Act and the terms and conditions of this Agreement. Subject to
the Securities Act and Section 4.01, Company Securities may be freely
transferred by any DLJ Entity.
(b) Any attempt to transfer any Company Securities not in compliance
with this Agreement shall be null and void and the Company shall not, and shall
cause any transfer agent not to, give any effect in the Company's stock records
to such attempted transfer.
SECTION 3.2. LEGENDS. In addition to any other legend that may be
required, each certificate for Shares or Warrants that is issued to any
Stockholder shall bear a legend in substantially the following form:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND MAY NOT
BE OFFERED OR SOLD EXCEPT IN COMPLIANCE THEREWITH. THIS
SECURITY IS ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON
TRANSFER AS SET FORTH IN THE AMENDED AND RESTATED INVESTORS'
AGREEMENT DATED AS OF OCTOBER 6, 2000, COPIES OF WHICH MAY BE
OBTAINED UPON REQUEST FROM ▇▇▇▇▇▇▇ HOLDINGS CO. OR ANY
SUCCESSOR THERETO.
If any Company Securities shall cease to be Registrable Securities under clause
(i) or clause (ii) of the definition thereof, the Company shall, upon the
written request of the holder thereof, issue to such holder a new certificate
evidencing such securities without the first sentence of the legend required by
this Section endorsed thereon. If any Company Securities shall cease to be
subject to any and all restrictions on transfer set forth in this Agreement, the
Company shall, upon the written request of the holder thereof, issue to such
holder a new certificate
14
evidencing such securities without the second sentence of the legend required
by this Section endorsed thereon.
SECTION 3.3. PERMITTED TRANSFEREES. Notwithstanding anything in this
Agreement to the contrary, any Stockholder may at any time transfer any or all
of its Company Securities to one or more of its Permitted Transferees without
the consent of the Board or any other Stockholder or group of Stockholders and
without compliance with Sections 3.04, 3.05 and 4.01 so long as (a) such
Permitted Transferee shall have agreed in writing to be bound by the terms of
this Agreement and (b) the transfer to such Permitted Transferee is not in
violation of applicable federal or state securities laws.
SECTION 3.4. RESTRICTIONS ON TRANSFERS BY MANAGEMENT STOCKHOLDERS. (a)
Except as provided in Section 3.03, each Management Stockholder and each
Permitted Transferee of such Management Stockholder may transfer its Company
Securities only as follows:
(i) in a transfer made in compliance with Section 4.01 or
4.02, or as permitted or required by any employment contract between
the Company or any Subsidiary and an employee;
(ii) subject to the Public Offering Limitations, in a Public
Offering in connection with the exercise of its rights under Section
5.02 hereof;
(iii) in a transfer made at the conclusion of the Applicable
Holdback Period (as defined in Section 5.03) following a Public
Offering, in compliance with Rule 144 promulgated under the Securities
Act; PROVIDED, HOWEVER, that until the Restriction Termination Date,
the Aggregate Ownership of such Management Stockholder as a result of
such transfer shall be equal to or exceed the greater of (x) 50% of
such Management Stockholder's Initial Ownership and (y) the percentage
of such Management Stockholder's Initial Ownership that is equal to the
Aggregate Ownership of the DLJ Entities as a percentage of the DLJ
Entities' Initial Ownership; or
(iv) following the Restriction Termination Date, to any Third
Party other than an Adverse Person for consideration consisting solely
of cash; PROVIDED, HOWEVER, that the number of Common Shares
transferred by such Management Stockholder pursuant to this Section
3.04(a)(iv) in any twelve month period shall not exceed 20% of such
Management Stockholder's Aggregate Ownership at the beginning of such
twelve month period.
15
For purposes of this Agreement, "PUBLIC OFFERING LIMITATIONS" means (A)
no Management Stockholder shall be permitted to exercise its rights under
Section 5.02 hereof (x) with respect to the Initial Public Offering and (y)
until such time as the Aggregate Ownership of the DLJ Entities shall be less
than 50% of their aggregate Initial Ownership and (B) in each Public Offering
following the Initial Public Offering, such Management Stockholder shall be
entitled to transfer a number of Shares not exceeding such Management
Stockholder's Pro Rata Portion of such Management Stockholder's Shares.
(b) The provisions of Section 3.04(a) shall terminate upon the
earliest to occur of (i) the tenth anniversary of the Closing Date and (ii) a
Change of Control. Notwithstanding the foregoing sentence, the provisions of
Section 3.04(a) shall not terminate with respect to any Management Stockholder's
Shares which shall have been pledged to the Company as security in connection
with any indebtedness for borrowed money owed by such Management Stockholder to
the Company unless the proceeds from the sale of such Shares are applied to
repay such indebtedness in full.
SECTION 3.5. RESTRICTIONS ON TRANSFERS BY THE INVESTORS, THE DLJIP
ENTITIES AND THE ▇▇▇▇▇▇ ENTITIES. (a) Except as provided in Section 3.03, each
of the Investors and its Permitted Transferees may transfer its Company
Securities only as follows:
(i) in a transfer made in compliance with Section 4.01
or 4.02; or
(ii) in a Public Offering in connection with the exercise
of its rights under Article 5 hereof.
(b) Each of the DLJIP Entities and the DLJIP Transferees may transfer
its Company Securities freely, subject only to compliance with Section 4.02.
(c) Each of the ▇▇▇▇▇▇ Entities and the ▇▇▇▇▇▇ Transferees may
transfer its Company Securities freely, subject only to compliance with Section
4.02.
(d) The provisions of Sections 3.05(a), (b) and (c) shall terminate
upon the earlier to occur of (i) the tenth anniversary of the Closing Date and
(ii) a Change of Control.
16
ARTICLE 4
TAG-ALONG RIGHTS; DRAG-ALONG RIGHTS
SECTION 4.1. RIGHTS TO PARTICIPATE IN TRANSFER. (a If the DLJ Entities
(the "SELLING PERSON") propose to transfer (other than transfers of Common
Shares (i) in a Public Offering or (ii) to any Permitted Transferee of any of
the DLJ Entities) a number of Company Securities equal to or exceeding 20% of
the Aggregate Ownership of the DLJ Entities in a single transaction or in a
series of related transactions on the date of the proposed sale (a "TAG-ALONG
SALE"), the Other Stockholders may, at their option, elect to exercise their
rights under this Section 4.01 (each such Stockholder, a "TAGGING PERSON"). In
the event of such a proposed transfer, the Selling Person shall provide each
Other Stockholder written notice of the terms and conditions of such proposed
transfer ("TAG-ALONG NOTICE") and offer each Tagging Person the opportunity to
participate in such sale. The Tag-Along Notice shall identify the number and
type of Company Securities subject to the offer ("TAG-ALONG OFFER"), the cash
price at which the transfer is proposed to be made, and all other material terms
and conditions of the Tag-Along Offer. Each Tagging Person shall have the right
(a "TAG-ALONG RIGHT"), exercisable by written notice ("SECTION 4.01 RESPONSE
NOTICE") given to the Selling Person within 10 Business Days of the date of
receipt of the Tag-Along Notice by such Tagging Person (the "TAG-ALONG NOTICE
PERIOD"), to request that the Selling Person include in the proposed transfer
the number and type of Company Securities held by such Tagging Person as is
specified in such notice; PROVIDED that if the aggregate number of Company
Securities proposed to be sold by the Selling Person and all Tagging Persons in
such transaction exceeds the number of Company Securities which can be sold on
the terms and conditions set forth in the Tag-Along Notice, then only the
Tag-Along Portion of the Company Securities of each Tagging Person shall be sold
pursuant to the Tag-Along Offer and the Selling Person shall sell its Tag-Along
Portion of the Company Securities and such additional Company Securities as
permitted by Section 4.01(d). Each Tagging Person shall deliver to the Selling
Person, together with its Section 4.01 Response Notice, the certificate or
certificates representing the Company Securities of such Tagging Person to be
included in the transfer, together with a limited power-of-attorney authorizing
the Selling Person to transfer such Company Securities on the terms set forth in
the Tag-Along Notice. Delivery of such certificate or certificates representing
the Company Securities to be transferred and the limited power-of-attorney
authorizing the Selling Person to transfer such Company Securities shall
constitute an irrevocable acceptance of the Tag-Along Offer by such Tagging
Persons. If, at the end of a 120 day period after such delivery, the Selling
Person has not completed the transfer of all of such Company Securities on
substantially the same terms and conditions set forth in the Tag-Along Notice,
the Selling Person shall return to each Tagging Person the limited
power-of-attorney (and all copies thereof) together with certificates
17
representing the unsold Company Securities which such Tagging Person delivered
for transfer pursuant to this Section 4.01.
(b Concurrently with the consummation of the Tag-Along Sale, the
Selling Person shall notify the Tagging Persons thereof, shall remit to the
Tagging Persons the total consideration (by bank or certified check) for the
Company Securities of the Tagging Persons transferred pursuant thereto, and
shall, promptly after the consummation of such Tag-Along Sale, furnish such
other evidence of the completion and time of completion of such transfer and the
terms thereof as may be reasonably requested by the Tagging Persons.
(c If at the termination of the Tag-Along Notice Period any Tagging
Person shall not have elected to participate in the Tag-Along Sale, such Tagging
Person will be deemed to have waived its rights under Section 4.01(a) with
respect to the transfer of its Company Securities pursuant to such Tag-Along
Sale.
(d If any Tagging Person declines to exercise its Tag-Along Rights or
elects to exercise its Tag-Along Rights with respect to less than such Tagging
Person's Tag-Along Portion, the DLJ Entities shall be entitled to transfer,
pursuant to the Tag-Along Offer, a number and type of Company Securities held by
the DLJ Entities equal to the number and type of Company Securities constituting
the portion of such Tagging Person's Tag-Along Portion with respect to which
Tag-Along Rights were not exercised.
(e The DLJ Entities and any Tagging Person who exercises the
Tag-Along Rights pursuant to this Section 4.01 may sell the Company Securities
subject to the Tag-Along Offer on the terms and conditions set forth in the
Tag-Along Notice (PROVIDED, HOWEVER, that the cash price payable in any such
sale may exceed the cash price specified in the Tag-Along Notice by up to 10%)
within 120 days of the date on which Tag-Along Rights shall have been waived,
exercised or expire.
SECTION 4.2. RIGHT TO COMPEL PARTICIPATION IN CERTAIN TRANSFERS. (a If
(i the DLJ Entities propose to transfer not less than 50% of their Initial
Ownership of any class of Company Securities to a Third Party in a bona fide
sale or (ii) the DLJ Entities propose a transfer in which the Company Securities
to be transferred by the DLJ Entities and their Permitted Transferees constitute
more than 50% of such class of outstanding Company Securities (a "SECTION 4.02
SALE"), the DLJ Entities may at their option require all Other Stockholders to
sell the Drag-Along Portion of their Company Securities ("DRAG-ALONG RIGHTS").
DLJMB shall provide written notice of such Section 4.02 Sale to the Other
Stockholders (a "SECTION 4.02 NOTICE") not later than 15 days prior to the
proposed Section 4.02 Sale. The Section 4.02 Notice shall identify the proposed
transferee for the Section 4.02 Sale, the number and type of Company Securities
proposed to be transferred pursuant to the Section 4.02 Sale, the proposed
18
consideration for the Company Securities (the "SECTION 4.02 SALE PRICE") and
all other material terms and conditions of the proposed Section 4.02 Sale.
The number of Company Securities to be sold by each Other Stockholder will be
the Drag-Along Portion of the Company Securities that such Other Stockholder
owns. Subject to Sections 4.02 and 4.03, each Other Stockholder shall be
required to participate in the Section 4.02 Sale on the terms and conditions
set forth in the Section 4.02 Notice and to tender the Drag-Along Portion of
its Company Securities as set forth below. The price payable in such transfer
shall be the Section 4.02 Sale Price. Not later than the 10th day following
the date of the Section 4.02 Notice (the "SECTION 4.02 NOTICE PERIOD"), each
of the Other Stockholders shall deliver to a representative of DLJMB
designated in the Section 4.02 Notice certificates representing the Drag
Along Portion of such Other Stockholder's Company Securities, duly endorsed,
together with all other documents required to be executed in connection with
such Section 4.02 Sale. If any Other Stockholder should fail to deliver such
certificates to DLJMB, the Company shall cause the books and records of the
Company to show that the Drag-Along Portion of such Other Stockholder's
Company Securities are bound by the provisions of this Section 4.02 and
Section 4.03 and that such Company Securities shall be transferred to the
purchaser of the Company Securities subject to the Section 4.02 Sale
immediately upon surrender for transfer by the holder thereof.
(b The DLJ Entities shall have a period of 90 days from the date
of receipt of the Section 4.02 Notice to consummate the Section 4.02 Sale on
the terms and conditions set forth in such Section 4.02 Sale Notice. If the
Section 4.02 Sale shall not have been consummated during such period, DLJMB
shall return to each of the Other Stockholders all certificates representing
Company Securities that such Other Stockholder delivered for transfer
pursuant hereto, together with any documents in the possession of DLJMB
executed by the Other Stockholder in connection with such proposed Section
4.02 Sale, and all the restrictions on transfer contained in this Agreement
or otherwise applicable at such time with respect to the Company Securities
owned by the Other Stockholders shall again be in effect.
(c Concurrently with the consummation of any Section 4.02 Sale
pursuant to this Section 4.02 and Section 4.03, DLJMB shall give notice
thereof to all Stockholders, shall remit to each Stockholder who has
surrendered certificates in connection with such Section 4.02 Sale the total
consideration (by bank or certified check) for the Company Securities
represented by such Stockholder's certificates and shall furnish such other
evidence of the completion and time of completion of such Section 4.02 Sale
and the terms thereof as may be reasonably requested by such Stockholders.
SECTION 4.3. CERTAIN RIGHTS. It is understood and agreed that the
employment agreements or associated restricted stock purchase agreements
19
between one or more Management Stockholders and the Company or any Subsidiary
may contain provisions permitting or requiring, under certain circumstances,
such Management Stockholders to sell to the Company or a Subsidiary, and
permitting or requiring, under certain circumstances, the Company or such
Subsidiary to purchase from such Management Stockholder, Common Shares. Such
provisions may, by the terms of such agreements, remain effective
notwithstanding that the employment relationship created by such employment
agreements has been terminated, in which event such provisions are deemed to
be incorporated herein and made a part hereof, to the extent appropriate.
ARTICLE 5
REGISTRATION RIGHTS
SECTION 5.1. DEMAND REGISTRATION. (a If the Company shall receive a
written request by any of (x) the DLJ Entities or their Permitted Transferees,
(y) the Requisite DLJIP Entities or (z) the ▇▇▇▇▇▇ Entities (any such requesting
Person, a "SELLING STOCKHOLDER") that the Company effect the registration under
the Securities Act, which, in the case of the Requisite DLJIP Entities and the
▇▇▇▇▇▇ Entities, shall be a Shelf Registration, of all or a portion of such
Selling Stockholder's Registrable Securities, and specifying the intended method
of disposition thereof, then the Company shall promptly give written notice of
such requested registration (a "DEMAND REGISTRATION") at least 10 days prior to
the anticipated filing date of the registration statement relating to such
Demand Registration to the Stockholders other than the Selling Stockholders and
thereupon will use its best efforts to effect, as expeditiously as possible, the
registration under the Securities Act of:
(i the Registrable Securities then held by the Selling
Stockholders which the Company has been so requested to register by
the Selling Stockholders; and
(ii subject to the restrictions set forth in Section 3.04, all
other Registrable Securities of the same type as that to which the
request by the Selling Stockholders relates which any other Stockholder
entitled to request the Company to effect an Incidental Registration
(as such term is defined in Section 5.02) pursuant to Section 5.02 (all
such Stockholders, together with the Selling Stockholders, the
"HOLDERS") has requested the Company to register by written request
received by the Company within 5 days after the receipt by such Holders
of such written notice given by the Company,
20
all to the extent necessary to permit the disposition (in accordance with the
intended methods thereof as aforesaid) of the Registrable Securities so to be
registered; PROVIDED that, subject to Section 5.01(d) hereof, (I) the Company
shall not be obligated to effect more than six Demand Registrations for the
DLJ Entities, (II) the Company shall not be obligated to effect more than one
Demand Registration for the Requisite DLJIP Entities and (III) the Company
shall not be obligated to effect more than one Demand Registration for the
▇▇▇▇▇▇ Entities; and PROVIDED, FURTHER, that the Company shall not be
obligated to effect any Demand Registration for the DLJ Entities unless the
aggregate proceeds expected to be received from the sale of Registrable
Securities to be included in such Demand Registration, in the reasonable
opinion of DLJMB exercised in good faith, equal or exceed (x) $25,000,000 if
such Demand Registration would constitute the Initial Public Offering, or (y)
$10,000,000 in all other cases. In no event will the Company be required to
effect more than one Demand Registration within any four-month period.
Notwithstanding anything in this Agreement to the contrary, the ▇▇▇▇▇▇
Entities may not assign their right to request a Demand Registration under
this Section 5.01(a) to any other Person.
(b Promptly after the expiration of the 5-day period referred to
in Section 5.01(a)(ii) hereof, the Company will notify all the Holders to be
included in the Demand Registration of the other Holders and the number of
Registrable Securities requested to be included therein. The Selling
Stockholders requesting a registration under this Section may, at any time
prior to the effective date of the registration statement relating to such
registration, revoke such request, without liability to any of the other
Holders, by providing a written notice to the Company revoking such request,
in which case such request, so revoked, shall be considered a Demand
Registration unless the participating Stockholders reimburse the Company for
all costs incurred by the Company in connection with such registration or
unless such revocation arose out of the fault of the Company.
(c The Company will pay all Registration Expenses in connection
with any Demand Registration.
(d A registration requested pursuant to this Section shall not be
deemed to have been effected unless the registration statement relating
thereto (A) has become effective under the Securities Act and (B) has
remained effective for a period of at least 180 days (or such shorter period
in which all Registrable Securities of the Holders included in such
registration have actually been sold thereunder); PROVIDED that if (i) after
any registration statement requested pursuant to this Section becomes
effective (x) such registration statement is interfered with by any stop
order, injunction or other order or requirement of the SEC or other
governmental agency or court and (y) less than 75% of the Registrable
Securities included in such registration statement is sold thereunder, or
(ii) the Maximum Offering Size (as defined below) is reduced in accordance
with Section 5.01(e) such that less than 66 2/3% of the Registrable Securities
of the Selling Stockholders
21
sought to be included in such registration are included, such registration
statement shall be at the sole expense of the Company and shall not be
considered a Demand Registration; and PROVIDED FURTHER that, in the event of
any Black Out Period (defined below), any Shelf Registration will remain
effective for a period of time equal to 180 days plus the length of such
Black Out Period.
Notwithstanding the foregoing, the Company shall not be required to
file, amend or supplement any Shelf Registration, any related prospectus or
any document incorporated therein by reference, for a period (a "BLACK OUT
PERIOD") not to exceed an aggregate of 60 days in any calendar year, in the
event that (i) in the case of any amendment or supplement only, an event
occurs and is continuing as a result of which the Shelf Registration, any
related prospectus or any document incorporated therein by reference as then
amended or supplemented would, in the Company's good faith judgment, contain
an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading, and (ii) in all
cases, (A) the Company determines in its good faith judgment that the
disclosure of such event at such time would have a material adverse effect on
the business, operations or prospects of the Company or (B) the disclosure
otherwise relates to a material business transaction which has not yet been
publicly disclosed; PROVIDED that such Black Out Period shall be extended for
any period, not to exceed an aggregate of 30 days in any calendar year,
during which the SEC is reviewing any proposed amendment or supplement to the
Shelf Registration, any related prospectus or any document incorporated
therein by reference which has been filed by the Company.
(e If a Demand Registration involves an Underwritten Public
Offering and the managing underwriter shall advise the Company and the
Selling Stockholders that, in its view, (i) the number and/or type of
Registrable Securities requested to be included in such registration
(including any securities which the Company proposes to be included which are
not Registrable Securities) or (ii) the inclusion of some or all of the
Registrable Securities owned by the Holders, in any such case, exceeds the
largest number and/or type of securities which can be sold without having an
adverse effect on such offering, including the price at which such securities
can be sold (the "MAXIMUM OFFERING SIZE"), the Company will include in such
registration, in the priority listed below, up to the Maximum Offering Size:
(A0 first, all Registrable Securities requested to be
registered by the Selling Stockholders (allocated, if
necessary for the offering not to exceed the Maximum Offering
Size, pro rata among such Holders on the basis of the relative
number of shares of Registrable Securities so requested to be
registered);
22
(B0 second, all Registrable Securities requested to
be included in such registration by any other Holder and their
Permitted Transferees (allocated, if necessary for the
offering not to exceed the Maximum Offering Size, pro rata
among such Holders on the basis of the relative number of
shares of Registrable Securities so requested to be included);
and
(C0 third, any securities proposed to be registered
by the Company.
(f If, in connection with any Demand Registration pursuant to this
Section or any sale pursuant to Rule 144A under the Securities Act with respect
to the Common Shares, Preferred Shares or shares of Senior Preferred Stock, any
Selling Stockholder shall seek to transfer any Warrants together with Common
Shares, Preferred Shares or shares of Senior Preferred Stock, the Company shall
at the request of any such Selling Stockholder effect a registration of such
Warrants to which the provisions of this Article 5 shall apply MUTATIS MUTANDIS
and a registration, pursuant to a Shelf Registration, so as to permit the resale
of the Common Shares for which any Warrants so transferred may be exercisable.
The Company shall maintain the effectiveness of any such Shelf Registration, and
take all actions necessary to permit resale of such Common Shares as may be
required by applicable state securities laws.
SECTION 5.2. INCIDENTAL REGISTRATION. (a If the Company proposes
to register any Company Securities under the Securities Act (other than a
registration of Common Shares (A) issuable upon exercise of employee stock
options or in connection with any employee benefit or similar plan of the
Company or (B) in connection with a direct or indirect acquisition by the
Company of another company), whether or not for sale for its own account, it
will each such time, subject to the provisions of Section 5.02(b), give
prompt written notice at least 10 days prior to the anticipated filing date
of the registration statement relating to such registration to each DLJ
Entity and each Other Stockholder, which notice shall set forth such
Stockholder's rights under this Section 5.02 and shall offer such
Stockholders the opportunity to include in such registration statement such
number of Registrable Securities of the same type as are proposed to be
registered as each such Stockholder may request (an "INCIDENTAL
REGISTRATION"). Upon the written request of any such Stockholder made within
5 days after the receipt of notice from the Company (which request shall
specify the number of Registrable Securities intended to be disposed of by
such Stockholder), the Company will use its best efforts to effect the
registration under the Securities Act of all Registrable Securities which the
Company has been so requested to register by such Stockholders, to the extent
requisite to permit the disposition of the Registrable Securities so to be
registered; PROVIDED that (1) if such registration involves an Underwritten
Public Offering, all such Stockholders requesting to be included in the
Company's registration must sell their Registrable Securities to the
23
underwriters selected as provided in Section 5.04(f) on the same terms and
conditions as apply to the Company and (2) if, at any time after giving
written notice of its intention to register any stock pursuant to this
Section 5.02(a) and prior to the effective date of the registration statement
filed in connection with such registration, the Company shall determine for
any reason not to register such securities, the Company shall give written
notice to all such Stockholders and, thereupon, shall be relieved of its
obligation to register any Registrable Securities in connection with such
registration (without prejudice, however, to the rights of any DLJ Entity
under Section 5.01). No registration effected under this Section 5.02 shall
relieve the Company of its obligations to effect a Demand Registration to the
extent required by Section 5.01. The Company will pay all Registration
Expenses in connection with each registration of Registrable Securities
requested pursuant to this Section 5.02.
(b If a registration pursuant to this Section 5.02 involves an
Underwritten Public Offering (other than in the case of an Underwritten
Public Offering requested by a Selling Stockholder in a Demand Registration,
in which case the provisions with respect to priority of inclusion in such
offering set forth in Section 5.01(e) shall apply) and the managing
underwriter advises the Company that, in its view, the number and/or type of
shares of Registrable Securities which the Company and the Stockholders
intend to include in such registration exceeds the Maximum Offering Size, the
Company will include in such registration, in the priority listed below, up
to the Maximum Offering Size:
(i first, so much of the securities proposed to be registered
for the account of the Company as would not cause the offering to
exceed the Maximum Offering Size; and
(ii second, all Registrable Securities requested to be
included in such registration pursuant to Section 5.02 (allocated, if
necessary for the offering not to exceed the Maximum Offering Size, pro
rata among such Stockholders on the basis of the relative number of
shares of Registrable Securities requested to be so included).
SECTION 5.3. HOLDBACK AGREEMENTS. If any registration of Registrable
Securities shall be in connection with an Underwritten Public Offering, each
Stockholder agrees not to effect any public sale or distribution, including
any sale pursuant to Rule 144, or any successor provision, under the
Securities Act, of any Registrable Securities, and not to effect any such
public sale or distribution of any Common Shares or of any stock convertible
into or exchangeable or exercisable for any Common Shares (in each case,
other than as part of such Underwritten Public Offering) during the 14 days
prior to the effective date of such registration statement (except as part of
such registration) or during the period after such effective date equal to
the lesser of (i) such period of time as agreed between such
24
managing underwriter and the Company and (ii) 180 days (such lesser period,
the "APPLICABLE HOLDBACK PERIOD").
SECTION 5.4. REGISTRATION PROCEDURES. Whenever Stockholders request
that any Registrable Securities be registered pursuant to Section 5.01 or 5.02,
the Company will, subject to the provisions of such Sections, use its best
efforts to effect the registration and the sale of such Registrable Securities
in accordance with the intended method of disposition thereof as quickly as
practicable, and in connection with any such request:
(a The Company will as expeditiously as possible prepare and file
with the SEC a registration statement on any form for which the Company then
qualifies or which counsel for the Company shall deem appropriate and which form
shall be available for the sale of the Registrable Securities to be registered
thereunder in accordance with the intended method of distribution thereof, and
use its best efforts to cause such filed registration statement to become and
remain effective for a period of not less than 180 days.
(b The Company will, if requested, prior to filing a registration
statement or prospectus or any amendment or supplement thereto, furnish to each
Stockholder holding Registrable Securities covered by such registration
statement and each underwriter, if any, of the Registrable Securities covered by
such registration statement copies of such registration statement as proposed to
be filed, and thereafter the Company will furnish to such Stockholder and
underwriter, if any, such number of copies of such registration statement, each
amendment and supplement thereto (in each case including all exhibits thereto
and documents incorporated by reference therein), the prospectus included in
such registration statement (including each preliminary prospectus) and such
other documents as such Stockholder or underwriter may reasonably request in
order to facilitate the disposition of the Registrable Securities owned by such
Stockholder.
(c After the filing of the registration statement, the Company will
promptly notify each Stockholder holding Registrable Securities covered by such
registration statement of any stop order issued or threatened by the SEC and
take all reasonable actions required to prevent the entry of such stop order or
to remove it if entered.
(d The Company will use its best efforts to (i) register or qualify
the Registrable Securities covered by such registration statement under such
other securities or blue sky laws of such jurisdictions in the United States as
any Stockholder holding such Registrable Securities reasonably (in light of such
Stockholder's intended plan of distribution) requests and (ii) cause such
Registrable Securities to be registered with or approved by such other
governmental agencies or authorities as may be necessary by virtue of the
business and operations of the Company and do any and all other acts and things
that may
25
be reasonably necessary or advisable to enable such Stockholder to consummate
the disposition of the Registrable Securities owned by such Stockholder;
PROVIDED that the Company will not be required to (A) qualify generally to do
business in any jurisdiction where it would not otherwise be required to
qualify but for this paragraph (d), (B) subject itself to taxation in any
such jurisdiction or (C) consent to general service of process in any such
jurisdiction.
(e The Company will immediately notify each Stockholder holding
such Registrable Securities, at any time when a prospectus relating thereto
is required to be delivered under the Securities Act, of the occurrence of an
event requiring the preparation of a supplement or amendment to such
prospectus so that, as thereafter delivered to the purchasers of such
Registrable Securities, such prospectus will not contain an untrue statement
of a material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading and
promptly prepare and make available to each such Stockholder any such
supplement or amendment.
(f (i The DLJ Entities will have the right, in their sole
discretion, to select an underwriter or underwriters in connection with any
Public Offering resulting from the exercise by any such DLJ Entity or its
Permitted Transferee of a Demand Registration, which underwriter or
underwriters may include any Affiliate of any DLJ Entity and (ii) the Company
will select an underwriter or underwriters in connection with any other
Public Offering. In connection with any Public Offering, the Company will
enter into customary agreements (including an underwriting agreement in
customary form) and take such other actions as are reasonably required in
order to expedite or facilitate the disposition of Registrable Securities in
any such Public Offering, including the engagement of a "qualified
independent underwriter" in connection with the qualification of the
underwriting arrangements with the NASD.
(g Upon the execution of confidentiality agreements in form and
substance satisfactory to the Company, the Company will make available for
inspection by any Stockholder and any underwriter participating in any
disposition pursuant to a registration statement being filed by the Company
pursuant to this Section 5.04 and any attorney, accountant or other
professional retained by any such Stockholder or underwriter (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 Inspectors in connection
with such registration statement. Records that the Company determines, in
good faith, to be confidential and that it notifies the Inspectors are
confidential shall not be disclosed by the Inspectors unless (i) the
disclosure of such Records is necessary to avoid or correct a misstatement or
omission in such registration statement or (ii) the release of such Records
is
26
ordered pursuant to a subpoena or other order from a court of competent
jurisdiction. Each Stockholder agrees that information obtained by it as a
result of such inspections shall be deemed confidential and shall not be used
by it as the basis for any market transactions in the Company Securities or
its Affiliates unless and until such is made generally available to the
public. Each Stockholder further agrees that it will, upon learning that
disclosure of such Records is sought in a court of competent jurisdiction,
give notice to the Company and allow the Company, at its expense, to
undertake appropriate action to prevent disclosure of the Records deemed
confidential.
(h The Company will furnish to each such Stockholder and to each such
underwriter, if any, a signed counterpart, addressed to such underwriter, of (i)
an opinion or opinions of counsel to the Company and (ii) a comfort letter or
comfort letters from the Company's independent public accountants, each in
customary form and covering such matters of the type customarily covered by
opinions or comfort letters, as the case may be, as a majority of such
Stockholders or the managing underwriter therefor reasonably requests.
(i) The Company will otherwise use its best efforts to comply with all
applicable rules and regulations of the SEC, and make available to its
stockholders, as soon as reasonably practicable, an earnings statement covering
a period of 12 months, beginning within three months after the effective date of
the registration statement, which earnings statement shall satisfy the
provisions of Section 11(a) of the Securities Act.
The Company may require each such Stockholder to promptly furnish in
writing to the Company such information regarding the distribution of the
Registrable Securities as the Company may from time to time reasonably request
and such other information as may be legally required in connection with such
registration.
Each such Stockholder agrees that, upon receipt of any notice from the
Company of the happening of any event of the kind described in Section 5.04(e),
such Stockholder will forthwith discontinue disposition of Registrable
Securities pursuant to the registration statement covering such Registrable
Securities until such Stockholder's receipt of the copies of the supplemented or
amended prospectus contemplated by Section 5.04(e), and, if so directed by the
Company, such Stockholder will deliver to the Company all copies, other than any
permanent file copies then in such Stockholder's possession, of the most recent
prospectus covering such Registrable Securities at the time of receipt of such
notice. In the event that the Company shall give such notice, the Company shall
extend the period during which such registration statement shall be maintained
effective (including the period referred to in Section 5.04(a)) by the number of
days during the period from and including the date of the giving of notice
pursuant to Section 5.04(e) to the date when the Company shall make available to
such
27
Stockholder a prospectus supplemented or amended to conform with the
requirements of Section 5.04(e).
Each Stockholder agrees that, upon receipt of the notice from the
Company of the commencement of a Black Out Period (in each case, a "BLACK OUT
NOTICE"), such Person will forthwith discontinue disposition of Registrable
Securities pursuant to the Shelf Registration until such Person is advised in
writing by the Company of the termination of the Black Out Period. Each
Person receiving a Black Out Notice hereby agrees that it will either (i)
destroy any prospectuses, other than permanent file copies, then in such
Person's possession which have been replaced by the Company with more
recently dated prospectuses or (ii) deliver to the Company (at the Company's
expense) all copies, other than permanent file copies, then in such Person's
possession of the prospectus covering such Registrable Securities that was
current at the time of receipt of the Black Out Notice.
SECTION 5.5. INDEMNIFICATION BY THE COMPANY. The Company agrees to
indemnify and hold harmless each Stockholder holding Registrable Securities
covered by a registration statement, its officers, directors and agents, and
each person, if any, who controls such Stockholder within the meaning of
Section 15 of the Securities Act or Section 20 of the Exchange Act from and
against any and all losses, claims, damages and liabilities caused by any
untrue statement or alleged untrue statement of a material fact contained in
any registration statement or prospectus relating to the Registrable
Securities (as amended or supplemented if the Company shall have furnished
any amendments or supplements thereto) or any preliminary prospectus, or
caused by 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, except insofar as such losses, claims, damages or liabilities are
caused by any such untrue statement or omission or alleged untrue statement
or omission based upon information furnished in writing to the Company by
such Stockholder or on such Stockholder's behalf expressly for use therein;
PROVIDED that with respect to any untrue statement or omission or alleged
untrue statement or omission made in any preliminary prospectus, or in any
prospectus, as the case may be, the indemnity agreement contained in this
paragraph shall not apply to the extent that any such loss, claim, damage,
liability or expense results from the fact that a current copy of the
prospectus (or, in the case of a prospectus, the prospectus as amended or
supplemented) was not sent or given to the person asserting any such loss,
claim, damage, liability or expense at or prior to the written confirmation
of the sale of the Registrable Securities concerned to such person if it is
determined that the Company has provided such prospectus and it was the
responsibility of such Stockholder to provide such person with a current copy
of the prospectus (or such amended or supplemented prospectus, as the case
may be) and such current copy of the prospectus (or such
28
amended or supplemented prospectus, as the case may be) would have cured the
defect giving rise to such loss, claim, damage, liability or expense. The
Company also agrees to indemnify any underwriters of the Registrable
Securities, their officers and directors and each person who controls such
underwriters on substantially the same basis as that of the indemnification
of the Stockholders provided in this Section 5.05.
SECTION 5.6. INDEMNIFICATION BY PARTICIPATING STOCKHOLDERS. Each
Stockholder holding Registrable Securities included in any registration
statement agrees, severally but not jointly, to indemnify and hold harmless
the Company, its officers, directors and agents and each Person, if any, who
controls the Company within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act to the same extent as the
foregoing indemnity from the Company to such Stockholder, but only (i) with
respect to information furnished in writing by such Stockholder or on such
Stockholder's behalf expressly for use in any registration statement or
prospectus relating to the Registrable Securities, or any amendment or
supplement thereto, or any preliminary prospectus or (ii) to the extent that
any loss, claim, damage, liability or expense described in Section 5.05
results from the fact that a current copy of the prospectus (or, in the case
of a prospectus, the prospectus as amended or supplemented) was not sent or
given to the Person asserting any such loss, claim, damage, liability or
expense at or prior to the written confirmation of the sale of the
Registrable Securities concerned to such Person if it is determined that it
was the responsibility of such Stockholder to provide such Person with a
current copy of the prospectus (or such amended or supplemented prospectus,
as the case may be) and such current copy of the prospectus (or such amended
or supplemented prospectus, as the case may be) would have cured the defect
giving rise to such loss, claim, damage, liability or expense. Each such
Stockholder also agrees to indemnify and hold harmless underwriters of the
Registrable Securities, their officers and directors and each Person who
controls such underwriters on substantially the same basis as that of the
indemnification of the Company provided in this Section 5.06. As a condition
to including Registrable Securities in any registration statement filed in
accordance with Article 5 hereof, the Company may require that it shall have
received an undertaking reasonably satisfactory to it from any underwriter to
indemnify and hold it harmless to the extent customarily provided by
underwriters with respect to similar securities.
SECTION 5.7. CONDUCT OF INDEMNIFICATION PROCEEDINGS. In case any
proceeding (including any governmental investigation) shall be instituted
involving any Person in respect of which indemnity may be sought pursuant to
this Article 5, such Person (an "INDEMNIFIED PARTY") shall promptly notify
the Person against whom such indemnity may be sought (the "INDEMNIFYING
PARTY") in writing and the Indemnifying Party shall assume the defense
thereof, including the employment of counsel reasonably satisfactory to such
Indemnified Party, and shall assume the payment of all fees and expenses;
PROVIDED that the failure of any
29
Indemnified Party so to notify the Indemnifying Party shall not relieve the
Indemnifying Party of its obligations hereunder except to the extent that the
Indemnifying Party is materially prejudiced by such failure to notify. In any
such proceeding, any Indemnified Party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such Indemnified Party unless (i) the Indemnifying Party and the Indemnified
Party shall have mutually agreed to the retention of such counsel or (ii) in
the reasonable judgment of such Indemnified Party representation of both
parties by the same counsel would be inappropriate due to actual or potential
differing interests between them. It is understood that the Indemnifying
Party shall not, in connection with any proceeding or related proceedings in
the same jurisdiction, be liable for the reasonable fees and expenses of more
than one separate firm of attorneys (in addition to any local counsel) at any
time for all such Indemnified Parties, and that all such fees and expenses
shall be reimbursed as they are incurred. In the case of any such separate
firm for the Indemnified Parties, such firm shall be designated in writing by
the Indemnified Parties. The Indemnifying Party shall not be liable for any
settlement of any proceeding effected without its written consent, but if
settled with such consent, or if there be a final judgment for the plaintiff,
the Indemnifying Party shall indemnify and hold harmless such Indemnified
Parties from and against any loss or liability (to the extent stated above)
by reason of such settlement or judgment. No Indemnifying Party shall,
without the prior written consent of the Indemnified Party, effect any
settlement of any pending or threatened proceeding in respect of which any
Indemnified Party is or could have been a party and indemnity could have been
sought hereunder by such Indemnified Party, unless such settlement includes
an unconditional release of such Indemnified Party from all liability arising
out of such proceeding.
SECTION 5.8. CONTRIBUTION. If the indemnification provided for in
this Article 5 is unavailable to the Indemnified Parties in respect of any
losses, claims, damages or liabilities referred to herein, then each such
Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a
result of such losses, claims, damages or liabilities (i) as between the
Company and the Stockholders holding Registrable Securities covered by a
registration statement on the one hand and the underwriters on the other, in
such proportion as is appropriate to reflect the relative benefits received
by the Company and such Stockholders on the one hand and the underwriters on
the other, from the offering of the Registrable Securities, or if such
allocation is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits but also the relative
fault of the Company and such Stockholders on the one hand and of such
underwriters on the other in connection with the statements or omissions
which resulted in such losses, claims, damages or liabilities, as well as any
other relevant equitable considerations and (ii) as between the Company on
the one hand and each such Stockholder on the other, in such proportion as is
appropriate to reflect the relative fault of the Company and of each such
Stockholder in connection with such
30
statements or omissions, as well as any other relevant equitable
considerations. The relative benefits received by the Company and such
Stockholders on the one hand and such underwriters on the other shall be
deemed to be in the same proportion as the total proceeds from the offering
(net of underwriting discounts and commissions but before deducting expenses)
received by the Company and such Stockholders bear to the total underwriting
discounts and commissions received by such underwriters, in each case as set
forth in the table on the cover page of the prospectus. The relative fault of
the Company and such Stockholders on the one hand and of such underwriters on
the other shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
the Company and such Stockholders or by such underwriters. The relative fault
of the Company on the one hand and of each such Stockholder on the other
shall be determined by reference to, among other things, whether the untrue
or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by such
party, and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company and the Stockholders agree that it would not be just and
equitable if contribution pursuant to this Section 5.08 were determined by
pro rata allocation (even if the underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take
account of the equitable considerations referred to in the immediately
preceding paragraph. The amount paid or payable by an Indemnified Party as a
result of the losses, claims, damages or liabilities referred to in the
immediately preceding paragraph shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred
by such Indemnified Party in connection with investigating or defending any
such action or claim. Notwithstanding the provisions of this Section 5.08, no
underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Registrable Securities
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages which such underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission, and no Stockholder shall be required to
contribute any amount in excess of the amount by which the total price at
which the Registrable Securities of such Stockholder were offered to the
public exceeds the amount of any damages which such Stockholder has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No Person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any Person who was not guilty of such
fraudulent misrepresentation. Each such Stockholder's obligation to
contribute pursuant to this Section 5.08 is several in the proportion that
the proceeds of the offering received by such Stockholder bears to the total
proceeds of the offering received by all such Stockholders and not joint.
31
SECTION 5.9. PARTICIPATION IN PUBLIC OFFERING. No Person may
participate in any Public Offering hereunder unless such Person (a) agrees to
sell such Person's securities on the basis provided in any underwriting
arrangements approved by the Persons entitled hereunder to approve such
arrangements and (b) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents reasonably
required under the terms of such underwriting arrangements and the provisions
of this Agreement in respect of registration rights.
SECTION 5.10. OTHER INDEMNIFICATION. Indemnification similar to that
specified herein (with appropriate modifications) shall be given by the
Company and each Stockholder participating therein with respect to any
required registration or other qualification of securities under any federal
or state law or regulation or governmental authority other than the
Securities Act.
SECTION 5.11. COOPERATION BY THE COMPANY. In the event any
Stockholder shall transfer any Registrable Securities pursuant to Rule 144A
under the Securities Act, the Company shall cooperate, to the extent
commercially reasonable, with such Stockholder and shall provide to such
Stockholder such information as such Stockholder shall reasonably request.
32
ARTICLE 6
MISCELLANEOUS
SECTION 6.1. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement among the parties hereto and supersedes all prior agreements and
understandings, oral and written, among the parties hereto with respect to the
subject matter hereof.
SECTION 6.2. BINDING EFFECT; BENEFIT. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective heirs,
successors, legal representatives and permitted assigns. Nothing in this
Agreement, expressed or implied, shall confer on any Person other than the
parties hereto, and their respective heirs, successors, legal representatives
and permitted assigns, any rights, remedies, obligations or liabilities under or
by reason of this Agreement.
SECTION 6.3. EXCLUSIVE FINANCIAL AND INVESTMENT BANKING ADVISOR.
During the period from and including the date of the Original Agreement through
and including the fifth anniversary of such date, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
Securities Corporation ("DLJSC"), or any Affiliate of DLJSC that the DLJ
Entities may choose in their sole discretion, shall be engaged as the exclusive
financial and investment banking advisor of the Company. DLJSC or such Affiliate
shall be entitled to reimbursement from the Company for all expenses incurred by
DLJSC or such Affiliate (including, without limitation, fees and expenses of
counsel) as financial and investment banking advisor of the Company.
SECTION 6.4. ASSIGNABILITY. This Agreement shall not be assignable by
any party hereto, except that any Person acquiring Company Securities who is
required by the terms of this Agreement or any employment agreement or stock
purchase, option, stock option or other compensation plan of the Company or any
Subsidiary to become a party hereto shall (unless already bound hereby) execute
and deliver to the Company an agreement to be bound by this Agreement and shall
thenceforth be a "STOCKHOLDER"; PROVIDED that, except as otherwise provided in
Section 2.06, the DLJIP Entities and the DLJIP Transferees may assign their
rights and obligations under this Agreement to any Person acquiring Company
Securities upon execution by such Person of an agreement to be bound by this
Agreement, which Person shall thenceforth be a "STOCKHOLDER"; PROVIDED FURTHER
that, except as otherwise provided in Section 5.01, the ▇▇▇▇▇▇ Entities and the
▇▇▇▇▇▇ Transferees may assign their rights and obligations under this Agreement
to any Person acquiring Company Securities upon execution by such Person of an
agreement to be bound by this Agreement, which Person shall thenceforth be a
"STOCKHOLDER". Any Stockholder who ceases to own beneficially any Company
Securities shall cease to be bound by the terms hereof (other than the
provisions of
33
Sections 5.05, 5.06, 5.07, 5.08, and 5.10 applicable to such Stockholder with
respect to any offering of Registrable Securities completed before the date
such Stockholder ceased to own any Company Securities).
SECTION 6.5. AMENDMENT; WAIVER; TERMINATION. No provision of this
Agreement may be waived except by an instrument in writing executed by the
party against whom the waiver is to be effective. No provision of this
Agreement may be amended or otherwise modified except by an instrument in
writing executed by the Company with the approval of the Board and
Stockholders holding at least 75% of the outstanding Shares, calculated on a
Fully-Diluted basis; PROVIDED that any such amendment or modification that
materially and adversely affects the rights of the DLJIP Entities or the
▇▇▇▇▇▇ Entities shall also require the prior written consent the DLJIP
Entities or the ▇▇▇▇▇▇ Entities, as the case may be (but only for so long as
the affected holder holds Company Securities equal to at least (i) 1% of the
outstanding Shares on a Fully-Diluted basis or (ii) its Initial Ownership
(calculated for the purposes of this proviso, in the case of the DLJIP
Entities, as of the date of this Agreement)).
SECTION 6.6. NOTICES. All notices, requests and other
communications to any party hereunder shall be in writing (including
facsimile transmissions and shall be given,
34
If to the Company, to:
▇▇▇▇▇▇▇ Holdings, Co.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: R. ▇▇▇▇ ▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Opco, to:
▇▇▇▇▇▇▇ Aircraft Holdings, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: R. ▇▇▇▇ ▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to the DLJ Entities, to:
DLJ Merchant Banking Partners II, L.P.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to:
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇., Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to the DLJIP Entities, to:
DLJ Investment Partners II, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
35
with a copy to:
▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇▇, Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
if to the ▇▇▇▇▇▇ Entities, to:
▇▇▇▇▇▇ Investment Management, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Ropes & ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
All notices, requests and other communications shall be deemed received
on the date of receipt by the recipient thereof if received prior to 5 p.m. in
the place of receipt and such day is a business day in the place of receipt.
Otherwise, any such notice, request or communication shall be deemed not to have
been received until the next succeeding business day in the place of receipt.
Any notice, request or other written communication sent by facsimile
transmission shall be confirmed by certified mail, return receipt requested,
posted within one Business Day, or by personal delivery, whether courier or
otherwise, made within two Business Days after the date of such facsimile
transmission.
Any Person who becomes a Stockholder shall provide its address and fax
number to the Company, which shall promptly provide such information to each DLJ
Entity and each other Stockholder.
SECTION 6.7. HEADINGS. The headings contained in this Agreement
are for convenience only and shall not affect the meaning or interpretation
of this Agreement.
36
SECTION 6.8. COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original and
all of which together shall be deemed to be one and the same instrument.
SECTION 6.9. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD
TO THE CONFLICTS OF LAW RULES OF SUCH STATE.
SECTION 6.10. SPECIFIC ENFORCEMENT. Each party hereto acknowledges that
the remedies at law of the other parties for a breach or threatened breach of
this Agreement would be inadequate and, in recognition of this fact, any party
to this Agreement, without posting any bond, and in addition to all other
remedies which may be available, shall be entitled to obtain equitable relief in
the form of specific performance, a temporary restraining order, a temporary or
permanent injunction or any other equitable remedy which may then be available.
SECTION 6.11. CONSENT TO JURISDICTION. Any suit, action or proceeding
seeking to enforce any provision of, or based on any matter arising out of or in
connection with, this Agreement or the transactions contemplated hereby shall be
brought in the United States District Court for the Southern District of New
York or any other New York State court sitting in New York City, and each of the
parties hereby consents to the exclusive jurisdiction of such courts (and of the
appropriate appellate courts therefrom) in any such suit, action or proceeding
and irrevocably waives, to the fullest extent permitted by law, any objection
which it may now or hereafter have to the laying of the venue of any such suit,
action or proceeding in any such court or that any such suit, action or
proceeding which is brought in any such court has been brought in an
inconvenient forum. Process in any such suit, action or proceeding may be served
on any party anywhere in the world, whether within or without the jurisdiction
of any such court. Without limiting the foregoing, each party agrees that
service of process on such party as provided in Section 6.06 shall be deemed
effective service of process on such party.
37
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.
▇▇▇▇▇▇▇ HOLDINGS CO.
By:_______________________________
Name:
Title:
▇▇▇▇▇▇▇ AIRCRAFT HOLDINGS, INC.
By:_______________________________
Name:
Title:
DLJ MERCHANT BANKING
PARTNERS II, L.P.
BY DLJ MERCHANT BANKING II, INC.
Managing General Partner
By:_______________________________
Name:
Title:
DLJ MERCHANT BANKING
PARTNERS II-A, L.P.
BY DLJ MERCHANT BANKING II, INC.,
Managing General Partner
By:_______________________________
Name:
Title:
38
DLJ OFFSHORE PARTNERS II, C.V.
BY DLJ MERCHANT BANKING II, INC.,
Advisory General Partner
By:_______________________________
Name:
Title:
DLJ DIVERSIFIED PARTNERS, L.P.
BY DLJ DIVERSIFIED PARTNERS, INC.,
Managing General Partner
By:_______________________________
Name:
Title:
DLJ DIVERSIFIED PARTNERS-A, L.P.
BY DLJ DIVERSIFIED PARTNERS, INC.,
Managing General Partner
By:_______________________________
Name:
Title:
DLJMB FUNDING II, INC.
By:_______________________________
Name:
Title:
39
DLJ EAB PARTNERS, L.P.
BY DLJ LBO PLANS MANAGEMENT
CORPORATION, General Partner
By:_______________________________
Name:
Title:
DLJ MILLENNIUM PARTNERS, L.P.
BY DLJ MERCHANT BANKING II, INC.,
Managing General Partner
By:_______________________________
Name:
Title:
UK INVESTMENT PLAN 1997 PARTNERS
BY UK INVESTMENT PLAN 1997, INC.,
General Partner
By:_______________________________
Name:
Title:
DLJ FIRST ESC L.P.
BY DLJ LBO PLANS MANAGEMENT
CORPORATION, as General Partner
By:_______________________________
Name:
Title:
40
DLJ ESC II L.P.
BY DLJ LBO PLANS MANAGEMENT
CORPORATION, as General Partner
By:_______________________________
Name:
Title:
DLJ MILLENNIUM PARTNERS-A, L.P.
BY DLJ MERCHANT BANKING II, INC.,
Managing General Partner
By:_______________________________
Name:
Title:
DLJ INVESTMENT PARTNERS, L.P.
BY DLJ INVESTMENT PARTNERS, INC.,
as Managing General Partner
By:_______________________________
Name:
Title:
DLJ INVESTMENT PARTNERS II, L.P.
BY DLJ INVESTMENT PARTNERS II, INC.,
as Managing General Partner
By:_______________________________
Name:
Title:
41
DLJ INVESTMENT FUNDING II, INC.
By:_______________________________
Name:
Title:
▇▇▇▇▇▇ HIGH YIELD TRUST
▇▇▇▇▇▇ FUNDS TRUST - ▇▇▇▇▇▇
HIGH YIELD TRUST II
▇▇▇▇▇▇ HIGH YIELD ADVANTAGE
FUND
▇▇▇▇▇▇ VARIABLE TRUST -
▇▇▇▇▇▇ VT HIGH YIELD FUND
▇▇▇▇▇▇ STRATEGIC INCOME FUND
▇▇▇▇▇▇ DIVERSIFIED INCOME
TRUST
By: ▇▇▇▇▇▇ INVESTMENT
MANAGEMENT, INC.
By:_______________________________
Name:
Title:
42