EXHIBIT 10.4
AMENDMENT TO STOCKHOLDERS AGREEMENT
This Amendment to Stockholders Agreement (the "Amendment"), dated as of
July ___, 1996, between MK Rail Corporation, a Delaware corporation ("MK Rail"),
and Morrison Knudsen Corporation, an Ohio corporation ("MKO").
WHEREAS, in connection with the reorganization of Morrison Knudsen
Corporation, a Delaware corporation ("MK"), in a case filed under Title 11 of
the United States Bankruptcy Code, as amended (the "Bankruptcy Code"), MK Rail
and MKO executed and delivered a Stockholders Agreement (the "Agreement") dated
as June 20, 1996; and
WHEREAS, the Agreement contains certain agreements regarding the
registration and voting of restricted shares of common stock of MK Rail held by
MKO which stock it was contemplated would be distributed to certain creditors of
MK and MKO; and
WHEREAS, as a result of negotiations between MK and equity holders of
MK, it is contemplated that MK's plan of reorganization will be amended so that
it provides for rights or options to be granted to equity holders of MK which
will permit them, subject to satisfaction of certain conditions, to receive a
portion of the restricted shares of common stock of MK Rail held by MKO; and
WHEREAS, MK has made a motion (an "1145 Motion") requesting that the
Bankruptcy Court having jurisdiction over MK's bankruptcy proceeding issue an
order (an "1145 Order") providing that the offering, issuance, sale and
distribution by MKO of the common stock of MK Rail qualifies for the exemption
(the "1145 Exemption"), available under Section 1145(a) of the Bankruptcy Code,
from the registration requirements of the Securities Act of 1933, as amended;
and
WHEREAS, the Securities and Exchange Commission has stated that it will
not object to the 1145 Motion; and
WHEREAS, the parties wish to amend the Agreement as set forth herein to
make certain changes thereto necessitated by the possibility that equity holders
of MK may acquire some restricted shares of Common Stock and that the 1145
Motion has been made;
NOW THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
1. The term "Rights Plan Amendment" is hereby amended and restated in
its entirety so it means the Second Amendment to Rights Agreement dated as of
June 20, 1996 and the Third Amendment to Rights Agreement of even date herewith
between MK Rail and Chase Mellon Shareholder Services, L.L.C., formerly known as
Chemical Mellon Shareholder Services, L.L.C.
2. The following language is added at the end of the last sentence of
the definition of "Registrable Securities" in Section 1.1 of the Agreement:
or in "ordinary trading transactions" within the meaning of Section
1145(b)(1) of the United States Bankruptcy Code, as amended (the
"Bankruptcy Code").
3. The reference to "creditors of MK" in the definition of "Shares" in
Section 1.1 of the Agreement is hereby changed to a reference to "persons."
4. The first sentence of Section 8 of the Agreement is hereby amended
in its entirety to read as follows:
Notwithstanding anything in this Agreement to the contrary, no Holder
may Transfer any shares of Common Stock to any Person, except as set
forth in the last paragraph of this Section 8, unless prior to any such
Transfer such Person has executed an agreement (in the form of Exhibit
A hereto) to be bound, or has otherwise been effectively bound pursuant
to the Plan, by the provisions of this Agreement.
5. The last sentence of Section 8 of the Agreement is hereby amended,
restated and replaced in its entirety by the following sentences:
MKO may distribute shares of Common Stock to equity holders of MK
provided that (a) the 1145 Order has been issued and is in full force
and effect and is not the subject of a pending appeal at the time the
Common Stock is distributed and (b) each equity holder receiving such
Common Stock has executed an agreement (in the form of Exhibit A
hereto) to be bound, or has otherwise been effectively bound pursuant
to the Plan, by the provisions of this Agreement. No distribution of
Common Stock to equity holders or any other party in a distribution
that qualifies for the 1145 Exemption shall excuse any party from or be
deemed to constitute a release of the transfer restrictions and
legending requirements set forth in this Section 8, except as set forth
in the penultimate sentence of this paragraph, and all Common Stock so
distributed shall after such distribution be subject to said transfer
restrictions and legend requirements as well as all other terms and
conditions hereof. The foregoing transfer restrictions and legend shall
be removed in connection with any sale of Common Stock to the public
pursuant to an effective registration statement or pursuant to Rule 144
or any similar rule promulgated by the Commission under the Securities
Act, or in "ordinary trading transactions" within the meaning of
Section 1145(b)(1) of the Bankruptcy Code, in each case so long as the
specific identities of the Transferees are not known to the Holders
selling such shares prior to such sale and so long as the Transferees
are not assigned and do not receive any rights under this Agreement.
The Company may also put the following legend on certificates of stock
held by Transferees of MKO and their Transferees that are bound to the
terms of this Agreement:
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THE SHARES OF STOCK REPRESENTED BY THIS CERTIFICATE HAVE NOT
BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "ACT"), OR ANY STATE SECURITIES LAWS. SUCH SHARES OF
STOCK MAY NOT BE TRANSFERRED EXCEPT (1) PURSUANT TO A
REGISTRATION STATEMENT EFFECTIVE UNDER THE ACT AND ANY
APPLICABLE STATE SECURITIES LAWS, (2) PURSUANT TO AN EXEMPTION
FROM THE REGISTRATION REQUIREMENTS OF THE ACT AND ANY
APPLICABLE STATE SECURITIES LAW, OR (3) IF THE STOCK HAS BEEN
RECEIVED BY THE HOLDER HEREOF IN A DISTRIBUTION THAT QUALIFIES
FOR THE EXEMPTION, AVAILABLE UNDER SECTION 1145(a) OF THE
UNITED STATES BANKRUPTCY CODE, AS AMENDED (THE "BANKRUPTCY
CODE"), TO THE REGISTRATION REQUIREMENTS OF THE ACT, IN
ORDINARY TRADING TRANSACTIONS WITHIN THE MEANING OF SECTION
1145(b)(1) OF THE BANKRUPTCY CODE.
6. All terms and provisions of the Agreement, as amended hereby, shall
continue to be in full force and effect.
IN WITNESS WHEREOF, the undersigned have hereunto set their hands as of
the day and year first set forth above.
MK RAIL CORPORATION
By:_______________________________
Title:____________________________
MORRISON KNUDSEN CORPORATION
By:_______________________________
Title:____________________________
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