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EXHIBIT 10.5
RANGER AEROSPACE CORPORATION
EXECUTIVE STOCK AGREEMENT
THIS AGREEMENT is made as of April 2, 1998, between Ranger
Aerospace Corporation, a Delaware corporation (the "Company") and ▇▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇ ("Executive").
The Company and the Executive desire to enter into an
agreement pursuant to which Executive shall purchase, and the Company shall
sell, 2,663 shares of the Company's Class A Common Stock, par value $.01 per
share (the "Class A Common Stock") at a price of $100 per share. Together, the
Class A Common Stock, the Class B Common Stock, par value $.01 per share (the
"Class B Common Stock" and, together with the Class A Common Stock, the "Common
Stock"), 10 1/2% Subordinated Notes (the "Notes") and the Series A Preferred
Stock (the "Preferred Stock") (it being understood that the Notes and the
Preferred Stock shall be treated as one and the same class of securities, with
identical rights hereunder) are referred to herein as the "Company Stock." All
of such shares of Company Stock and all shares of Company Stock hereafter
acquired by Executive are referred to herein as "Executive Stock." All shares of
Executive Stock shall be designated as Time-Vesting Stock. Certain definitions
are set forth in paragraph 7 of this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants
contained herein, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
1. Purchase and Sale of Executive Stock.
(a) Upon execution of this Agreement, Executive shall
purchase, and the Company shall sell, 2,663 shares of Class A Common Stock at a
price of $100 per share. The Company shall deliver to Executive the certificate
representing such shares of Company Stock, and Executive shall deliver to the
Company a promissory note in the form of Annex A attached hereto in an aggregate
principal amount of $266,300 (the "Executive Note"). Executive's obligations
under the Executive Note shall be secured by a pledge of the Executive Stock to
the Company, and in connection therewith, Executive shall enter into a pledge
agreement in the form of Annex B attached hereto.
(b) Within 30 days after Executive purchases any shares of
Executive Stock from the Company hereunder, Executive shall make an effective
election with the Internal Revenue Service under Section 83(b) of the Internal
Revenue Code and the regulations promulgated there under in the form of Annex C
attached hereto and any similar filing required by applicable state law.
(c) In connection with the purchase and sale of the Executive
Stock hereunder, Executive represents and warrants to the Company that:
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(i) The Executive Stock to be acquired by Executive
pursuant to this Agreement shall be acquired for Executive's own
account and not with a view to, or intention of, distribution thereof
in violation of the 1933 Act, or any applicable state securities laws,
and the Executive Stock shall not be disposed of in contravention of
the 1933 Act or any applicable state securities laws.
(ii) Executive is sophisticated in financial matters
and is able to evaluate the risks and benefits of the investment in the
Executive Stock.
(iii) Executive is able to bear the economic risk of
his investment in the Executive Stock for an indefinite period of time.
Executive understands that the Executive Stock has not been registered
under the 1933 Act and, therefore, cannot be sold unless subsequently
registered under the 1933 Act or an exemption from such registration is
available.
(iv) Executive has had an opportunity to ask
questions and receive answers concerning the terms and conditions of
the offering of Executive Stock and has had full access to (A) such
other information concerning the Company as he has requested and (B)
such other information which is necessary and desirable to make an
informed investment decision regarding the purchase Executive Stock
hereunder. Executive has reviewed a copy of the Share Purchase
Agreement, dated as of March 14, 1998 and amended as of the date
hereof, between the Company, Viad Corp. and Viad Service Company,
Limited pursuant to which the Company acquired substantially all of the
stock of certain subsidiaries of Aircraft Service International Group,
Inc. and the Security Purchase Agreement dated as of the date hereof,
between the Company, ▇▇▇▇ ▇▇▇▇▇▇▇ Mutual Life Insurance Company and
CIBC Wood Gundy Ventures, Inc. and Executive is familiar with the
transactions contemplated thereby.
(v) This Agreement constitutes the legal, valid and
binding obligation of Executive, enforceable in accordance with its
terms, and the execution, delivery and performance of this Agreement by
Executive do not and shall not conflict with, violate or cause a breach
of any agreement, contract or instrument to which Executive is a party
or any judgment, order or decree to which Executive is subject.
(d) As an inducement to the Company to issue the Executive
Stock to Executive, and as a condition thereto, Executive acknowledges and
agrees that:
(i) neither the issuance of the Executive Stock to
Executive nor any provision contained herein shall entitle Executive to
remain in the employment of the Company or its Subsidiaries or affect
the right of the Company to terminate Executive's employment at any
time; and
(ii) the Company shall have no duty or obligation to
disclose to Executive, and Executive shall have no right to be advised
of, any material information regarding the
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Company or its Subsidiaries at any time prior to, upon or in
connection with the repurchase of Executive Stock upon the termination
of Executive's employment with the Company or its Subsidiaries or as
otherwise provided hereunder.
(e) The Company and Executive acknowledge and agree that this
Agreement has been executed and delivered, and the Executive Stock has been
issued hereunder, in connection with and as a part of the compensation and
incentive arrangements between the Company and Executive.
2. Time-Vesting Nature of Executive Stock.
(a) Executive Stock purchased hereunder shall become vested,
and shall only vest, upon the third anniversary of the date hereof; provided
that:
(i) Upon the occurrence of a Sale of the Company or a
Qualified Public Offering, all shares of Executive Stock purchased hereunder
which have not yet become vested shall become vested at the time of such event;
(ii) In the event of that Executive is terminated without
Cause or the Executive resigns with Good Reason, all shares of Executive Stock
purchased hereunder which have not yet become vested shall become vested at the
time of such event.
(b) Shares of Executive Stock which have become vested
pursuant to this paragraph 2 are referred to herein as "Vested Shares," and all
other shares of Executive Stock are referred to herein as "Unvested Shares."
3. Repurchase Option.
(a) In the event Executive ceases to be employed by the
Company or its Subsidiaries (the "Termination"), the Executive Stock (whether
held by Executive or one or more of Executive's transferees) shall be subject to
repurchase by the Company pursuant to the terms and conditions set forth in this
paragraph 3 (the "Repurchase Option").
(b) The purchase price for each Vested Share shall be (i)
equal to the Fair Market Value of such share if Executive is terminated without
Cause, the Executive resigns with Good Reason or Executive is terminated
pursuant to Executive's death or Permanent Disability, or (ii) equal to the
lower of the Executive's Original Cost for such shares (with shares having the
lowest cost subject to repurchase prior to shares with a higher cost) and Fair
Market Value if Executive is terminated for Cause or resigns without Good
Reason. The purchase price for each Unvested Share shall be the Original Cost
for such share.
(c) The Company may elect to purchase all or any portion of
such Executive Stock by delivering written notice (the "Repurchase Notice") to
the holder or holders of the Executive Stock within 150 days after the
Termination. The Repurchase Notice shall set forth the number of shares of each
class of Executive Stock to be acquired from each holder of Executive
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Stock, the aggregate consideration to be paid for such shares and the time and
place for the closing of the transaction. The number of shares to be repurchased
by the Company shall first be satisfied to the extent possible from the shares
of Executive Stock held by Executive at the time of delivery of the Repurchase
Notice. If the number of shares of Executive Stock then held by Executive is
less than the total number of shares of Executive Stock the Company has elected
to purchase, the Company shall purchase the remaining shares elected to be
purchased from the other holder(s) of Executive Stock under this Agreement, pro
rata according to the number of shares of Executive Stock held by such other
holder(s) at the time of delivery of such Repurchase Notice (determined as close
as practicable to the nearest whole shares).
(d) If for any reason the Company does not elect to purchase
all of the Unvested Stock pursuant to the Repurchase Option, the Investors shall
be entitled to exercise the Repurchase Option for the shares of Executive Stock
the Company has not elected to purchase (the "Available Shares"). As soon as
practicable after the Company has determined that there will be Available
Shares, but in any event within 90 days after the Termination, the Company shall
give written notice (the "Option Notice") to the Investors setting forth the
number of Available Shares and the purchase price for the Available Shares. The
Investors may elect to purchase any number of Available Shares by delivering
written notice (the "Election Notice") to the Company within 45 days after
receipt of the Option Notice from the Company; provided that if more than one
Investor elects to purchase any or all Available Shares and the number of
Available Shares is less than the aggregate number of Shares of Executive Stock
elected to be purchased by such electing Investors, each Investor shall be
entitled to purchase the lesser of (i) the number of shares of such class that
such Investor has elected to purchase as indicated in the Election Notice or
(ii) the number of shares of such class ob tained by multiplying the number of
shares specified in the Option Notice by a fraction, the numerator of which is
the number of shares of such class of Company Stock (on a fully-diluted basis)
held by such Investor and the denominator of which is the aggregate number of
Shares of such class of Company Stock (on a fully-diluted basis) held by all
electing Investors. In the event all Available Shares are not purchased by the
Investors pursuant to the immediately preceding sentence, the Available Shares
remaining to be purchased shall be allocated among the Investors who elect to
purchase more Available Shares (as indicated in their respective Election
Notices) than they are entitled to purchase pursuant to the immediately
preceding sentence as the Investors shall agree in writing. As soon as
practicable, and in any event within 15 days after the expiration of the 45-day
period set forth above, the Company shall notify each holder of Executive Stock
as to the number of shares being purchased from such holder by the Investors
(the "Supplemental Repurchase Notice"). At the time the Company delivers the
Supplemental Repurchase Notice to the holder(s) of Executive Stock, the Company
shall also deliver written notice to each Investor setting forth the number of
shares such Investor is entitled to purchase, the aggregate purchase price and
the time and place of the closing of the transaction.
(e) The closing of the purchase of the Executive Stock
pursuant to the Repurchase Option shall take place on the date designated by the
Company in the Repurchase Notice or Supplemental Repurchase Notice, which date
shall not be more than sixty (60) days nor less than five days after the
delivery of the later of either such notice to be delivered. The Company and/or
the Investors shall pay for the Executive Stock to be purchased pursuant to the
Repurchase Option
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by delivery of, in the case of each Investor, a check or wire transfer of funds
and, in the case of the Company at its option, (i) cancellation or exchange of
the Executive Note, (ii) a check or wire transfer of funds, (iii) a subordinated
note or notes payable in up to, three equal annual installments beginning on the
first anniversary of the closing of such purchase and bearing interest (payable
quarterly) at a rate per annum equal to the interest rate then being charged to
the Company under any revolving working capital credit facility, or (iv) any
combination of (i)-(iii), in the aggregate amount of the purchase price for such
shares; provided that the Company shall use reasonable efforts to make all such
repurchases in excess of the amount due under any Executive Note with a check or
wire transfer of funds. Any notes issued by the Company pursuant to this
paragraph 3(e) shall be subject to any restrictive covenants to which the
Company or any of its subsidiaries is subject at the time of such purchase. In
addition to offsetting amounts outstanding under the Executive Note issued to
the Company hereunder, the Company may pay the purchase price for such shares by
offsetting any other bona fide debts owed by Executive to the Company. The
purchasers of Executive Stock hereunder shall be entitled to receive customary
representations and warranties from the sellers regarding such sale of shares
(including representations and warranties regarding good title to such shares,
free and clear of any liens or encumbrances) and to require all sellers'
signatures be guaranteed by a national bank or reputable securities broker.
(f) The right of the Company and the Investors to repurchase
Executive Stock pursuant to this paragraph 3 shall not terminate.
(g) Notwithstanding anything to the contrary contained in this
Agreement, all repurchases of Executive Stock by the Company shall be subject to
applicable restrictions contained in the Delaware General Corporation Law and in
the Company's and its Subsidiaries debt and equity financing agreements. If any
such restrictions prohibit the repurchase of Executive Stock hereunder which the
Company is otherwise entitled or required to make, the time periods provided in
this paragraph 3 shall be suspended, and the Company may make such repurchases
as soon as it is permitted to do so under such restrictions.
4. Put Option.
(a) In the event of a Termination for any reason other than
(i) Executive's death or Permanent Disability, (ii) Executive's Termination with
Cause or (iii) Executive's Termination without Good Reason, the holder of
Executive Stock (whether such holder is Executive or one or more of Executive's
transferees) shall have the right to require the Company to repurchase all or
any shares of Executive Stock held by the Executive at the Put Price (the "Put")
by delivering a written notice to the Company specifying the number of shares to
be purchased (the "Put Notice") within 90 days after the Termination.
(b) The Put Notice shall set forth the number and class of
shares of Executive Stock to be Put to the Company. Upon the delivery of the Put
Notice, the Company shall in good faith promptly determine the Put Price as
provided hereunder, and subject to the provisions hereof within 30 days after
the determination of the Put Price, the Company shall purchase and the holder
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of the Executive Stock shall sell the number of shares of Executive Stock
specified in the Put Notice at a mutually agreeable time and place (the "Put
Closing").
(c) At the Put Closing, the Executive shall deliver to the
Company certificates representing the Executive Stock to be repurchased by the
Company free and clear of all liens and encumbrances and duly endorsed in blank
or accompanied by duly executed forms of assignment (with signatures
guaranteed), and the Company shall deliver to the Executive the Put Price by
cancellation of the Executive Note or by cashier's or certified check payable to
the Investor or by wire transfer of immediately available funds to an account
designated by the Executive; provided that if and to the extent any such
purchase for cash is prohibited by the provisions of applicable state law or by
the provisions of the Company's or its subsidiaries' debt agreements or would
cause the Company to violate any minimum working capital level in any such debt
agreements (set at 110% of the required level for purposes of this Agreement),
the amount of the Put Price which is not able to be paid in cash shall be paid
for by the issuance of subordinated promissory notes in form and substance
reasonably satisfactory to the Executive with the principal amount payable in
three equal annual installments beginning on the first anniversary of issuance,
bearing interest (payable annually) at a floating rate per annum equal to the
highest interest rate then being charged to the Company under any revolving
working capital credit facility; provided that the Executive shall be entitled
to rescind any portion of the exercised Put if any portion of the Put Price
would be payable by a note.
(d) The "Put Price" for each share of Executive Stock shall be
equal to the Fair Market Value thereof
(e) The right of the Executive to Put shares of Executive
Stock pursuant to this paragraph 4 shall terminate upon the first to occur of
the Sale of the Company or a Qualified Public Offering.
(f) Notwithstanding anything to the contrary contained in this
Agreement, all repurchases of Executive Stock by the Company shall be subject to
applicable restrictions contained in the Delaware General Corporation Law and in
the Company's and its Subsidiaries debt and equity financing agreements. If any
such restrictions prohibit the repurchase of Executive Stock hereunder which the
Company is otherwise entitled or required to make, the time periods provided in
this paragraph 4 shall be suspended, and shall recommence when the Company may
make such repurchases under such restrictions.
5. Restrictions on Transfer. Executive shall not sell,
transfer, assign, pledge, or otherwise dispose of any interest in any shares of
Executive Stock (each, a "Transfer"), except with the consent of the Board of
Directors (the "Board") or pursuant to paragraphs 2 and 3 of the Securityholders
Agreement of even date.
6. Legend. Each note or certificate evidencing Executive Stock
pursuant to the terms of this Agreement shall be stamped or otherwise imprinted
with a legend in substantially the following form:
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"The securities represented by this certificate are subject to
a Executive Stock Agreement dated as of April 2, 1998 among
the issuer of such securities (the "Company") and the
Executive named therein, as amended and modified from time to
time. A copy of such Executive Stock Agreement shall be
furnished without charge by the Company to the holder hereof
upon written request."
The Company shall imprint such legend on certificates evidencing Executive Stock
outstanding as of the date hereof.
7. Definitions.
"Cause" shall have the definition provided in the Employment
Agreement between the Company and Executive of even date herewith.
"Company Stock" shall have the meaning set forth in the
preamble of this Agreement.
"Employment Agreement" shall mean the employment agreement
between Aircraft Service International Group, Inc. and Executive of even date.
"Executive Stock" shall include Executive Stock in the hands
of any holder other than Executive (except for the Company and the Investors and
except for transferees in a Public Sale), and except as otherwise provided
herein, each such other holder of Executive Stock shall succeed to all rights
and obligations attributable to Executive as a holder of Executive Stock
hereunder. Executive Stock shall also include shares of the Company's capital
stock issued with respect to Executive Stock by way of a stock split, stock
dividend or other recapitalization.
"Fair Market Value" of each share of Executive Stock means the
average of the closing prices of the sales of each class of Executive Stock on
all securities exchanges on which the Company Stock may at the time be listed,
or, if there have been no sales on any such exchange on any day, the average of
the highest bid and lowest asked prices on all such exchanges at the end of such
day, or, if on any day a class of Executive Stock is not so listed, the average
of the representative bid and asked prices quoted in the NASDAQ System as of
4:00 P.M., New York time, or, if on any day a class of Executive Stock is not
quoted in the NASDAQ System, the average of the highest bid and lowest asked
prices on such day in the domestic over-the-counter market as reported by the
National Quotation Bureau Incorporated, or any similar successor organization,
in each such case averaged over a period of 21 days consisting of the day as of
which the Fair Market Value is being determined and the 20 consecutive business
days prior to such day. If at any time a class of Executive Stock is not listed
on any securities exchange or quoted in the NASDAQ System or the
over-the-counter market, the Fair Market Value shall be the fair value of the
share of Executive Stock determined in good faith by the Board (without taking
into account the effect of any contemporaneous repurchase of Unvested Shares
under paragraph 4 hereof), which determination shall not require an independent
appraisal of the value of the share of Executive Stock.
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"Good Reason" shall mean the Constructive Termination (as
defined in the Employment Agreement) of the Executive.
"Independent Third Party" means any person (i) who,
immediately prior to the contemplated transaction, does not own Company Stock
representing in excess of 5% of the Company's Voting Power, (ii) who is not
controlling, controlled by or under common control with any such person and
(iii) who is not the spouse or descendant (by birth or adoption) of any such
person.
"Investors" means each of ▇▇▇▇ ▇▇▇▇▇▇▇ Mutual Life Insurance
Company and CIBC Wood Gundy Ventures, Inc.
"1933 Act" means the Securities Act of 1933, as amended from
time to time.
"Original Cost" of each share of Common Stock purchased
hereunder shall be equal to $100 (as proportionately adjusted for all subsequent
stock splits, stock dividends and other recapitalizations).
"Permanent Disability" means a mental incapacity or physical
disability of the Executive, rendering him unable to engage in his usual duties
for a period of ninety (90) days or more, whether consecutive or not, within any
twelve (12) consecutive month period, and shall be determined in good faith by
the Board of Directors of the Company.
"Public Sale" means any sale pursuant to a registered public
offering under the 1933 Act or any sale to the public pursuant to Rule 144
promulgated under the 1933 Act effected through a broker, dealer or market
maker.
"Qualified Public Offering" means the sale, in an underwritten
public offering by the Company registered under the 1933 Act, of shares of
Common Stock having an aggregate offering value of at least $35 million and a
per share price for each class of Company Stock of at least four times Original
Cost.
"Sale of the Company" means the sale of the Company to an
Independent Third Party or affiliated group of Independent Third Parties
pursuant to which such party or parties acquire (i) capital stock of the Company
possessing a majority of the Company's Voting Power (whether by merger,
consolidation or sale or transfer of the Company's capital stock) or (ii) all or
substantially all of the Company's assets determined on a consolidated basis.
"Securityholders Agreement" means the securityholders
agreement of even date between the Company, ▇▇▇▇ ▇▇▇▇▇▇▇ Mutual Life Insurance
Company, CIBC Wood Gundy Ventures, Inc., the ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Trust and certain
other persons named therein.
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"Subsidiary" means any corporation of which the Company owns
securities having a majority of the ordinary voting power in electing the board
of directors directly or through one or more subsidiaries.
"Voting Power" means, with respect to each shares of Company
Stock as determined on a fully-diluted basis, one (1) vote per share with
respect to the Class A Common Stock and Class B Common Stock (whether designated
as voting or nonvoting).
8. Notices. Any notice provided for in this Agreement must be
in writing and must be either personally delivered, mailed by first class mail
(postage prepaid and return receipt requested) or sent by reputable overnight
courier service (charges prepaid) to the recipient at the address below
indicated:
To the Company:
Ranger Aerospace Corporation
GSP International Airport
Box 12233
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Chief Financial Officer
With copies (which shall not constitute notice) to:
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, P.C.
To Executive:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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To the Investors:
CIBC Wood Gundy Ventures, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ Mutual Life Insurance Company
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇▇
or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party. Any
notice under this Agreement shall be deemed to have been given when so delivered
or sent or, if mailed, five days after deposit in the U.S.
mail.
9. General Provisions.
(a) Transfers in Violation of Agreement. Any Transfer or
attempted Transfer of any Executive Stock in violation of any provision of this
Agreement shall be void, and the Company shall not record such Transfer on its
books or treat any purported transferee of such Executive Stock as the owner of
such stock for any purpose. Notwithstanding the preceding sentence and the
Securityholders Agreement of even date, Executive may pledge all shares of
Executive Stock to the Company to secure payment of the Executive Note.
(b) Severability. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability shall not affect
any other provision or any other jurisdiction, but this Agreement shall be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.
(c) Complete Agreement. This Agreement, those documents
expressly referred to herein and other documents of even date herewith embody
the complete agreement and understanding among the parties and supersede and
preempt any prior understandings, agreements or representations by or among the
parties, written or oral, which may have related to the subject matter hereof in
any way.
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(d) Counterparts. This Agreement may be executed in separate
counterparts, each of which is deemed to be an original and all of which taken
together constitute one and the same agreement.
(e) Successors and Assigns. Except as otherwise provided
herein, this Agreement shall bind and inure to the benefit of and be enforceable
by Executive, the Company, the Investors and their respective successors and
assigns (including subsequent holders of Executive Stock); provided that the
rights and obligations of Executive under this Agreement shall not be assignable
except in connection with a permitted transfer of Executive Stock hereunder.
(f) Choice of Law. The corporate law of the State of Delaware
shall govern all questions concerning the relative rights of the Company or its
stockholders. All other questions con cerning the construction, validity,
enforcement and interpretation of this Agreement and the exhibits hereto shall
be governed by the internal law, and not the law of conflicts, of the State of
Delaware.
(g) Remedies. Each of the parties to this Agreement (including
the Investors) shall be entitled to enforce its rights under this Agreement
specifically, to recover damages and costs (including reasonable attorney's
fees) caused by any breach of any provision of this Agreement and to exercise
all other rights existing in its favor. The parties hereto agree and acknowledge
that money damages would not be an adequate remedy for any breach of the
provisions of this Agreement and that any party may in its sole discretion apply
to any court of law or equity of competent jurisdiction (without posting any
bond or deposit) for specific performance and/or other injunctive relief in
order to enforce or prevent any violations of the provisions of this Agreement.
(h) Amendment and Waiver. The provisions of this Agreement may
be amended and waived only by (i) the Company (ii) the holders of a majority of
the Voting Power of Executive Stock and (iii) with respect to Section 2 only,
the holders of a majority of the Voting Power held by Investors voting as a
single class.
(i) Business Days. If any time period for giving notice or
taking action hereunder expires on a day which is a Saturday, Sunday or legal
holiday in the state in which the Company's chief executive office is located,
the time period shall be automatically extended to the business day immediately
following such Saturday, Sunday or holiday.
10. Third Party Beneficiaries. Investors shall be deemed to be
third party beneficiaries of the provisions of this Agreement which specifically
reference them. No other third party beneficiaries are intended or shall be
deemed to be created hereby.
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IN WITNESS WHEREOF, the parties hereto have executed this
Agreement on the date first written above.
RANGER AEROSPACE CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Its: President and CEO
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/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Agreed and Accepted:
▇▇▇▇ ▇▇▇▇▇▇▇ MUTUAL LIFE
INSURANCE COMPANY
By: /s/ D. ▇▇▇▇ ▇▇▇▇▇▇▇
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Its: Senior Investment Officer
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CIBC WOOD GUNDY VENTURES, INC.
By: Illegible
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Its: Managing Director
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ANNEX A
PROMISSORY NOTE
$266,300 April 1, 1998
For value received, ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ("Promisor") promises to
pay to the order of Ranger Aerospace Corporation, a Delaware corporation (the
"Company"), the aggregate principal sum of $266,300. This Note was issued
pursuant to and is subject to the terms of the Executive Stock Agreement, dated
as of the date hereof, between the Company and Promisor (the "Executive Stock
Agreement"). Unless otherwise indicated herein, capitalized terms used in this
Note have the meaning set forth in the Executive Stock Agreement.
Interest shall accrue on a daily basis on the outstanding
principal amount of this Note at a rate equal to the lesser of (i) 9.5% per
annum, compounded annually, computed on the basis of a 360 day year and the
actual number of days elapsed or (ii) the highest rate permitted by applicable
law, and shall be payable at such time as the principal of this Note becomes due
and payable.
Payments of principal of, and accrued and unpaid interest
under, this Note shall be due and payable on demand.
Payments of principal of, and accrued and unpaid interest
under, this Note shall be due and payable upon Executive's receipt of proceeds
from the transfer of any Executive Stock (other than a transfer to a Permitted
Transferee, as defined in, and in accordance with, the Securityholders
Agreement) in the full amount of such proceeds or such lesser amount as is
necessary to pay the full amount of outstanding principal of and accrued
interest under this Note and for Promisor to otherwise fully and finally
discharge its obligations under this Note. Promisor may, at his option, pay all
or any portion of the principal of, and accrued and unpaid interest under, this
Note at any time prior to the maturity hereof without penalty or premium.
Promisor may, at his option, pay all or any portion of amounts due under this
Note by surrendering to the Company shares of Executive Stock having a Fair
Market Value equal to the amount of such payment. Any payment hereunder shall be
applied first to pay accrued and unpaid interest under this Note and second to
reduce the outstanding principal amount of this Note.
The amounts due under this Note are secured by a pledge of the
Pledged Shares (as such term is defined in the Pledge Agreement, dated as of the
date hereof, between Promisor and the Company). Any cash dividends declared and
paid with respect to the Pledged Shares shall be payable directly to the Company
and shall be applied to reduce the outstanding principal amount (and any
interest thereon) of this Note and any cash dividends paid to Promisor with
respect to the Pledged Shares will be promptly remitted to the Company and shall
be applied to reduce the outstanding principal amount (and any interest thereon)
of this Note.
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Notwithstanding anything to the contrary contained herein or
in the Executive Stock Agreement, it is expressly agreed that the Company or any
subsequent holder of this Note shall look only to the Pledged Shares with
respect to aggregate Defaults in excess of the sum of (i) 25% of the original
principal amount of this Note and (ii) 25% of all interest (both paid and
unpaid) accrued on the Note, it being understood that, with respect to such
amounts, this Note shall be without recourse to Promisor with respect to
aggregate Defaults exceeding such amount.
In the event Promisor fails to pay any amounts due hereunder
when due, Promisor shall pay to the holder hereof, in addition to such amounts
due, all costs of collection, including reasonable attorneys fees.
Promisor, or his successors and assigns, hereby waives
diligence, presentment, protest and demand and notice of protest, demand,
dishonor and nonpayment of this Note, and expressly agrees that this Note, or
any payment hereunder, may be extended from time to time and that the holder
hereof may accept security for this Note or release security for this Note, all
without in any way affecting the liability of Promisor hereunder.
Any failure by the Company to exercise any right hereunder
shall not be construed as a waiver of its right to exercise the same or any
other right hereunder at any other time.
This Note and all rights hereunder shall be governed by the
internal laws, and not the laws of conflicts, of the State of Florida.
* * * *
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IN WITNESS WHEREOF, this has been executed as of the date
first above written.
RANGER AEROSPACE CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------
Its: President and CEO
----------------------------
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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ANNEX B
RANGER AEROSPACE CORPORATION
EXECUTIVE STOCK PLEDGE AGREEMENT
THIS PLEDGE AGREEMENT is made as of April 2, 1998, between
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ("Pledgor"), and Ranger Aerospace Corporation, a Delaware
corporation (the "Company").
The Company and Pledgor are parties to an Executive Stock
Agreement of even date, pursuant to which Pledgor purchased 2,663 shares of the
Company's Class A Common Stock, $.01 par value per share and (the "Executive
Stock"), for an aggregate purchase price of $266,300. The Company has allowed
Pledgor to purchase the Pledged Shares by delivery to the Company of a note (the
"Note") in the aggregate principal amount of $266,300. This Pledge Agreement
provides the terms and conditions upon which the Note is secured by a pledge to
the Company of the Pledged Shares.
NOW, THEREFORE, in consideration of the premises contained
herein and other good and valuable consideration the receipt and sufficiency of
which are hereby acknowledged, and in order to induce the Company to accept the
Note as payment for the Pledged Shares, Pledgor and the Company hereby agree as
follows:
1. Pledge. Pledgor hereby pledges to the Company, and grants
to the Company a security interest in, the Executive Stock and any other
securities of the Company held by Pledgor ("Pledged Shares") as security for the
prompt and complete payment when due of the unpaid principal of and interest on
the Note and full payment and performance of the obligations and liabilities of
Pledgor hereunder.
2. Delivery of Pledged Shares. Upon the execution of this
Pledge Agreement and, thereafter, immediately upon Pledgor's receipt of any
additional Pledged Shares, Pledgor shall deliver to the Company the
certificate(s) representing the Pledged Shares, together with duly executed
forms of assignment sufficient to transfer title thereto to the Company.
3. Voting Rights; Cash Dividends. Notwithstanding anything to
the contrary contained herein, during the term of this Pledge Agreement until
such time as there exists a default in the payment of principal or interest on
the Note or any other default under the Note or hereunder, Pledgor shall be
entitled to all voting rights with respect to the Pledged Shares and shall be
entitled to receive all cash dividends paid in respect of the Pledged Shares.
Upon the occurrence of and during the continuance of any such default, Pledgor
shall no longer be able to vote the Pledged
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Shares and the Company shall retain all such cash dividends payable on the
Pledged Shares as additional security hereunder.
4. Stock Dividends; Distributions, etc. If, while this Pledge
Agreement is in effect, Pledgor becomes entitled to receive or receives any
securities or other property in addition to, in substitution of, or in exchange
for any of the Pledged Shares (whether as a distribution in connection with any
recapitalization, reorganization or reclassification, a stock dividend or
otherwise), Pledgor shall accept such securities or other property on behalf of
and for the benefit of the Company as additional security for Pledgor's
obligations under the Note and shall promptly deliver such additional security
to the Company together with duly executed forms of assignment, and such
additional security shall be deemed to be part of the Pledged Shares hereunder.
5. Default. If Pledgor defaults in the payment of the
principal or interest under the Note when it becomes due (whether upon demand,
acceleration or otherwise) or any other event of default under the Note or this
Pledge Agreement occurs (including the bankruptcy or insolvency of Pledgor), the
Company may exercise any and all the rights, powers and remedies of any owner of
the Pledged Shares (including the right to vote the shares and receive dividends
and distributions with respect to such shares) and shall have and may exercise
without demand any and all the rights and remedies granted to a secured party
upon default under the Uniform Commercial Code of the State of Florida or
otherwise available to the Company under applicable law. Without limiting the
foregoing, the Company is authorized to sell, assign and deliver at its
discretion, from time to time, all or any part of the Pledged Shares at any
private sale or public auction, on not less than ten days written notice to
Pledgor, at such price or prices and upon such terms as the Company may deem
advisable. Pledgor shall have no right to redeem the Pledged Shares after any
such sale or assignment. At any such sale or auction, the Company may bid for,
and become the purchaser of, the whole or any part of the Pledged Shares offered
for sale. In case of any such sale, after deducting the costs, attorneys' fees
and other expenses of sale and delivery, the remaining proceeds of such sale
shall be applied to the principal of and accrued interest on the Note; provided
that after payment in full of the indebtedness evidenced by the Note, the
balance of the proceeds of sale then remaining shall be paid to Pledgor and
Pledgor shall be entitled to the return of any of the Pledged Shares remaining
in the hands of the Company. Pledgor shall be liable for any deficiency if the
remaining proceeds are insufficient to pay the indebtedness under the Note in
full, including the fees of any attorneys employed by the Company to collect
such deficiency.
6. Costs and Attorneys' Fees. All costs and expenses
(including reasonable attorneys' fees) incurred in exercising any right, power
or remedy conferred by this Pledge Agreement or in the enforcement thereof,
shall become part of the indebtedness secured hereunder and shall be paid by
Pledgor or repaid from the proceeds of the sale of the Pledged Shares hereunder.
7. Payment of Indebtedness and Release of Pledged Shares. Upon
payment in full of the indebtedness evidenced by the Note, the Company shall
surrender the Pledged Shares to Pledgor together with all forms of assignment.
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8. No Other Liens; No Sales or Transfers. Pledgor hereby
represents and warrants that he has good and valid title to all of the Pledge
Shares, free and clear of all liens, security interests and other encumbrances,
and Pledgor hereby covenants that, until such time as all of the outstanding
principal of and interest on the Note has been repaid, Pledgor shall not (i)
create, incur, assume or suffer to exist any pledge, security interest,
encumbrance, lien or charge of any kind against the Pledged Shares or Pledgor's
rights or a holder thereof, other than pursuant to this Agreement and the
Securityholders Agreement of even date, or (ii) sell or otherwise transfer any
Pledged Shares or any interest therein.
9. Further Assurances. Pledgor agrees that at any time and
from time to time upon the written request of the Company, Pledgor shall execute
and deliver such further documents (including UCC financing statements) and do
such further acts and things as the Company may reasonably request in order to
effect the purposes of this Pledge Agreement.
10. Severability. Any provision of this Pledge Agreement which
is prohibited or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such prohibition or
unenforceability without invalidating the remaining provisions hereof, and any
such prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.
11. No Waiver; Cumulative Remedies. The Company shall not by
any act, delay, omission or otherwise be deemed to have waived any of its rights
or remedies hereunder, and no waiver shall be valid unless in writing, signed by
the Company, and then only to the extent therein set forth. A waiver by the
Company of any right or remedy hereunder on any one occasion shall not be
construed as a bar to any right or remedy which the Company would otherwise have
on any future occasion. No failure to exercise nor any delay in exercising on
the part of the Company, any right, power or privilege hereunder shall preclude
any other or further exercise thereof or the exercise of any other right, power
or privilege. The rights and remedies herein provided are cumulative and may be
exercised singly or concurrently, and are not exclusive of any rights or
remedies provided by law.
12. Waivers, Amendments; Applicable Law. None of the terms or
provisions of this Pledge Agreement may be waived, altered, modified or amended
except by an instrument in writing, duly executed by the parties hereto. This
Agreement and all obligations of the Pledgor hereunder shall together with the
rights and remedies of the Company hereunder, inure to the benefit of the
Company and its successors and assigns. This Pledge Agreement shall be governed
by, and be construed and interpreted in accordance with, the laws of the State
of Florida.
* * * *
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IN WITNESS WHEREOF, this Pledge Agreement has been executed as
of the date first above written.
RANGER AEROSPACE CORPORATION
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------
Its: President & CEO
----------------------------
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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ANNEX C
________ __, 1998
ELECTION TO INCLUDE STOCK IN GROSS
INCOME PURSUANT TO SECTION 83(b) OF THE
INTERNAL REVENUE CODE
The undersigned purchased shares of Class A Common Stock, par
value $.01 per share (the "Shares"), of Ranger Aerospace Corporation (the
"Company") on ______ __,1998. Under certain circumstances, the Company has the
right to repurchase the Shares at cost from the undersigned (or from the holder
of the Shares, if different from the undersigned) should the undersigned cease
to be employed by the Company or its subsidiaries. Hence, the Shares are subject
to a substantial risk of forfeiture and are nontransferable. The undersigned
desires to make an election to have the Shares taxed under the provision of Code
Section 83(b) at the time he purchased the Shares.
Therefore, pursuant to Code Section 83(b) and Treasury
Regulation Section 1.83-2 promulgated thereunder, the undersigned hereby makes
an election, with respect to the Shares (described below), to report as taxable
income for calendar year 1998 the excess (if any) of the Shares' fair market
value on _______ __, 1998 over purchase price thereof.
The following information is supplied in accordance with
Treasury Regulation Section 1.83-2(e):
1. The name, address and social security number of the
undersigned:
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇, ▇▇ ▇▇▇▇▇
SSN: ###-##-####
2. A description of the property with respect to which the
election is being made: _______ shares of Ranger Aerospace Corporation Class A
Common Stock, par value $.01 per share.
3. The date on which the property was transferred: _________
__, 1998. The taxable year for which such election is made: calendar 1998.
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4. The restrictions to which the property is subject: the
Class A Common Stock shall vest over time. If at any time during the first three
years after the purchase of the Shares the undersigned ceases to be employed by
the Company or any of its subsidiaries, the unvested portion of the Shares shall
be subject to repurchase by the Company at cost or fair market value.
5. The fair market value on _______ __, 1998 of the property
with respect to which the election is being made, determined without regard to
any lapse restrictions: $______ per share of Class A Common Stock.
6. The amount paid for such property: $______ per share of
Class A Common Stock.
A copy of this election has been furnished to the Secretary of
the Company pursuant to Treasury Regulations Section 1.83-2(e)(7).
Dated: April 2, 1998 /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
6