Exhibit 4.3
WARRANT AND REGISTRATION RIGHTS AGREEMENT
WARRANT AND REGISTRATION RIGHTS AGREEMENT, dated as of May 15, 2001 (this
"Agreement"), is by and among APW LTD., a Bermuda company (the "Company"), and
the holders of Warrant Certificates referred to below who are being issued
Warrants in connection with the Credit Agreement referred to below (the
"Investors").
WHEREAS, in connection with the Amended and Restated Multi-Currency Credit
Agreement, dated as of May 15, 2001 (as the same may be amended, supplemented or
otherwise modified from time to time, the "Credit Agreement"), by and among the
Company, certain lenders (the "Lenders"), Bank One NA, as syndication agent,
Chase Manhattan Bank, as documentation agent, and Bank of America, National
Association, as administrative agent, the Company has agreed to issue certain
Warrants (the "Warrants") evidenced by Warrant Certificates in the form of
Exhibit A hereto (together with any certificates issued in replacement or
substitution therefor, the "Warrant Certificates") to purchase the Company's
Common Shares, par value $0.01 per share, including the related preferred share
purchase rights to the extent such rights have not been redeemed or cancelled
(the "Common Shares"), pursuant to the terms of such Warrants;
WHEREAS, in connection with the Credit Agreement, the Company has agreed,
upon the terms and conditions set forth herein, to register for sale by the
Investors the shares of Common Shares received by the Investors upon exercise of
the Warrants; and
WHEREAS, the Company and the Investors desire to set forth certain
agreements relating to the Warrants and the Common Shares issuable upon exercise
thereof.
NOW, THEREFORE, in consideration of the foregoing and the covenants of the
parties set forth herein and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, subject to the terms
and conditions set forth herein, the parties hereby agree as follows:
Section 1. Certain Definitions. In this Agreement the following terms
shall have the following meanings:
"Accredited Investor" shall have the meaning set forth in Rule 501 of the
General Rules and Regulations promulgated under the Securities Act.
"Affiliate" shall mean, when used with respect to a specified Person,
another Person that directly, or indirectly through one or more intermediaries,
controls or is controlled by or is under common control with the Person
specified.
"Applicable Law" means (a) all applicable common law and principles of
equity and (b) all applicable provisions of all (i) constitutions, statutes,
rules, regulations, ordinances and orders of governmental bodies, (ii)
authorizations, consents, approvals, licenses or exemptions of,
registrations or filings with, or reports or notices to, governmental bodies and
(iii) orders, decisions, judgments and decrees of all courts, administrative
agencies and arbitrators.
"Commencement Date" has the meaning assigned thereto in the Warrant
Certificates.
"Commission" shall mean the Securities and Exchange Commission or any other
federal agency at the time administering the Securities Act.
"Company Rights Plan" shall have the meaning ascribed to it in Section 3(d)
of this Agreement.
"Connell" shall have the meaning ascribed to it in Section 5(a)(ii) of this
Agreement.
"Connell Registration Rights Agreement" shall have the meaning ascribed to
it in Section 5(a)(ii) of this Agreement.
"Designated Affiliate" means, as to any Lender, an Affiliate of such Lender
designated by such Lender within one (1) month of the Original Issuance Date to
hold some or all of the Warrants issuable hereunder.
"Effective Date" means the date the Credit Agreement becomes effective.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as amended,
and the rules and regulations of the Commission thereunder, all as the same
shall be in effect at the relevant time.
"Holders" shall mean (i) the Investors, the Lenders, their Designated
Affiliates and permitted transferees, and (ii) each Person holding Registrable
Shares as a result of a transfer or assignment, in accordance with the terms and
conditions of this Agreement, to that Person of Registrable Shares other than
pursuant to an effective registration statement or Rule 144 (or any successor
provision) under the Securities Act.
"Indemnified Party" shall have the meaning ascribed to it in Section 7(c)
of this Agreement.
"Indemnifying Party" shall have the meaning ascribed to it in Section 7(c)
of this Agreement.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind, or any other type of
preferential arrangement that has the practical effect of creating a security
interest, in respect of such asset.
"Market Price" has the meaning assigned thereto in the Warrant
Certificates.
"Person" shall mean an individual, corporation, partnership, limited
liability company, estate, trust, association, private foundation, joint stock
company or other entity.
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The terms "Register," "Registered" and "Registration" refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act providing for the sale by the Holders of
Registrable Shares in accordance with the method or methods of distribution
designated by the Holders, and the declaration or ordering of the effectiveness
of such registration statement by the Commission.
"Registrable Shares" shall mean the Warrant Shares issued upon exercise of
the Warrants; provided, however, that any such Common Shares shall cease to be
Registrable Shares when (A) a registration statement with respect to the sale of
such shares shall have become effective under the Securities Act and such shares
shall have been disposed of in accordance with such registration statement; (B)
such shares shall have been sold in accordance with Rule 144; (C) such shares
shall have been otherwise transferred and new certificates not subject to
transfer restrictions under the Securities Act and not bearing any legend
restricting further transfer shall have been delivered by the Company, and no
other applicable and legally binding restriction on transfer under the federal
securities laws shall exist or (D) such shares, after having been issued,
otherwise cease to be outstanding.
"Registration Expenses" shall mean all out-of-pocket expenses (excluding
Selling Expenses) incurred by the Company in complying with Section 5 hereof,
including, without limitation, the following: (a) all registration and filing
fees; (b) reasonable fees and expenses of compliance with federal and state
securities laws (including, without limitation, reasonable fees and
disbursements of counsel in connection with state securities qualifications of
the Registrable Shares under the laws of such jurisdictions as the Holders may
reasonably designate); (c) printing (including, without limitation, reasonable
expenses of printing or engraving certificates representing the Registrable
Shares in a form eligible for deposit with The Depository Trust Company or its
nominee and otherwise meeting the requirements of any securities exchange on
which they are listed and of printing registration statements and prospectuses),
messenger, telephone, shipping and delivery expenses; (d) reasonable fees and
disbursements of counsel for the Company; (e) reasonable fees and disbursements
of all independent public accountants of the Company (including without
limitation the reasonable expenses of any annual or special audit and "cold
comfort" letters reasonably required by the managing underwriter); (f)
Securities Act liability insurance if the Company so desires; (g) reasonable
fees and expenses of other Persons reasonably necessary in connection with the
registration, including any experts, retained by the Company; (h) reasonable
fees and expenses incurred in connection with the listing of the Registrable
Shares on each securities exchange on which securities of the same class are
then listed; (i) reasonable fees and expenses associated with any filing with
the National Association of Securities Dealers, Inc. required to be made in
connection with the registration statement; and (j) reasonable fees and
disbursements of one counsel for the Holders participating in the registration.
"Rule 144" shall mean Rule 144 promulgated by the Commission under the
Securities Act, or any successor thereto, as the same shall be in effect at the
relevant time.
"Securities Act" shall mean the Securities Act of 1933, as amended, and the
rules and regulations of the Commission thereunder, all as the same shall be in
effect at the relevant time.
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"Selling Expenses" shall mean all underwriting discounts, selling
commissions and stock transfer taxes applicable to any sale of Registrable
Shares.
"Subsidiary" means, as to any Person, any corporation or other entity of
which securities or other 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.
"UK Banks" has the meaning assigned thereto in the Warrant Certificates.
"Warrant Shares" has the meaning assigned thereto in the Warrant
Certificates.
Section 2. Issuance of Warrants. On the Effective Date, in consideration
for the Lenders entering into the Credit Agreement, the Company shall issue to
each Lender (or its Designated Affiliate) a Warrant Certificate representing
Warrants to purchase the number of Common Shares to which such Lender is
entitled as set forth in Exhibit B hereto.
Section 3. Representations, Warranties and Covenants of the Company. The
Company represents and warrants to the Lenders and their Designated Affiliates
that:
(a) Corporate Existence and Power. The Company is a company duly
continued, validly existing and in good standing under the laws of Bermuda, and
is duly qualified as a foreign corporation and authorized to do business in all
jurisdictions wherein the character of the properties owned or held under lease
by it or the nature of the business transacted by it makes such qualification
necessary, except for those jurisdictions in which the failure so to qualify or
be authorized, singly or in the aggregate, have not had and would not reasonably
be expected to have a materially adverse effect upon the business, financial
position or results of operations of the Company and its Subsidiaries taken as a
whole, and the Company has all corporate powers, and all material governmental
licenses, authorizations, consents and approvals, required to carry on its
business as presently conducted.
(b) Corporate and Governmental Authorization; No Contravention. The
execution, delivery and performance by the Company of this Agreement and each
Warrant Certificate are within the Company=s corporate powers, have been duly
authorized by all necessary corporate action, require no action by or in respect
of, or filing or recording with, any governmental body, agency or official and
do not (i) contravene, or constitute a default under, any provision of
Applicable Law or of the memorandum of association or bye-laws of the Company or
of any agreement, judgment, injunction, order, decree or other instrument
binding upon the Company, or (ii) result in the creation or imposition of any
Lien on any asset of the Company or any of its Subsidiaries.
(c) Binding Effect. Each of this Agreement and each Warrant
Certificate is a valid and binding obligation of the Company.
(d) Capitalization of the Company; Reservation of Shares; Other Matters
Relating to Capital Stock.
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(i) As of the Effective Date, the authorized capital stock of the
Company consists solely of 250,000,000 Common Shares of which (assuming no
Lender or Designated Affiliate exercises any Warrant) 40,791,301 shares of
Common Shares are issued and outstanding and 5,000,000 Series A Junior
Participating Preferred Stock, par value $0.01 per share, issuable in accordance
with that certain Rights Agreement, dated July 17, 2000, between the Company and
Firstar Bank, N.A., as Rights Agent (the "Company Rights Plan"), of which no
shares are issued and outstanding. All of such outstanding capital stock is
validly issued, fully paid and nonassessable and has been issued in compliance
with all applicable laws. As of the Effective Date, there are options, warrants
and convertible securities exercisable or convertible into __________ Common
Shares. As of the Effective Date, the applicable exercise price of all such
options, warrants and convertible securities is greater than the exercise price
of the Warrants. As of the Effective Date, except as set forth on Schedule 3(d)
and except for the Warrants and rights issued under the Company Rights Plan,
there are no existing options, convertible securities, warrants, calls, pledges,
transfer restrictions (except restrictions imposed by federal and state
securities laws), liens, rights of first offer, rights of first refusal,
antidilution provisions or commitments of any character relating to any issued
or unissued shares of capital stock of the Company. Except for the Warrants or
as set forth on Schedule 3(d), there are no preemptive or other preferential
rights applicable to the issuance and sale of equity securities (or securities
convertible or exercisable into or exchangeable for equity securities) of the
Company. Except for the Warrants or as set forth on Schedule 3(d) and the
warrants being issued to the UK Banks pursuant to the UK Credit Facilities (as
defined in Section 7) and the Connell Registration Rights Agreement, there are
no registration rights with respect to any of the Company's Common Shares or
securities exercisable or convertible into Common Shares.
(ii) As of the Effective Date, sufficient shares of authorized but
unissued Common Shares have been reserved by corporate action in connection with
the prospective exercise of the Warrants. The issuance of the Warrants will not
(x) require any further corporate action by the stockholders or directors of the
Company, (y) be subject to any statutory or contractual preemptive rights of any
present or future stockholders or members of the Company or (z) conflict with
any provision of any agreement to which the Company is a party or by which the
Company is bound. All Common Shares issuable upon exercise of, and payment for
(including on a cashless basis pursuant to Section 3(d) of the Warrant
Certificate), the Warrants in accordance with their terms will be validly
authorized, fully paid and nonassessable.
(iii) The Company has not violated any applicable federal or state
securities laws in connection with the offer, sale and issuance of any of its
capital stock or securities. Assuming the representations of the Holders set
forth in this Agreement are true and correct, the offer, sale and issuance of
the Warrants and the Common Shares issuable upon exercise thereof do not require
registration under the Securities Act or any applicable federal or state
securities laws.
(iv) The Company has obtained all approvals required by Bermuda
authorities to issue the Warrants and the Warrant Shares. The offer, sale and
issuance of the Warrants and the Common Shares issuable upon exercise thereof do
not require prior registration under the laws of Bermuda. The Company covenants
that it will promptly complete all filings required by the laws of Bermuda to be
completed subsequent to the execution of this Agreement in order for the Company
to fulfill its obligations under this Agreement.
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(v) The Company's Common Shares are presently authorized for listing
and are listed and trading on The New York Stock Exchange, Inc. ("NYSE"). The
Company will use commercially reasonable efforts to maintain the listing of the
Common Shares on the NYSE or an equivalent stock exchange.
(vi) The warrants being issued to the UK Banks pursuant to the UK
Credit Facilities (as defined in Section 7) contain terms substantially similar
to, and in all material respects no more favorable to the UK Banks than, the
terms of this Agreement and the Warrant Certificates to the Investors.
Section 4. Compliance with Securities Laws; Legends.
(a) Investment Intent. Each Lender represents and warrants to the Company
that it is acquiring the Warrants for its own account, with no present intention
of selling or otherwise distributing the same to the public. Each Lender has
been provided with information required by Rule 502 under the Securities Act and
has had the opportunity to obtain additional information as desired in order to
evaluate the merits and risks inherent in holding Warrant and Warrant Shares.
Each Lender has not been offered the Warrant and Warrant Shares by any general
advertising or general solicitation. Each Lender is able to bear the economic
risks and lack of liquidity inherent in the holding of the Warrant and Warrant
Shares.
(b) Status of Securities. Each Lender acknowledges that the Warrants
and Warrant Shares have not been and, except as contemplated by this Agreement,
will not be registered under the Securities Act or under any state securities
laws and are being offered and sold in reliance upon federal and state
exemptions for transactions not involving any public offering.
(c) Status of Lenders. Each Lender represents and warrants to the
Company that it is an Accredited Investor.
(d) Transfer of Warrants and Warrant Shares.
(i) Without limiting any other permitted transfers contemplated by
this Agreement and subject to Section 4(d)(iii) below, the Warrants and Warrant
Shares may be transferred pursuant to (1) public offerings registered by the
Company under the Securities Act, (2) Rule 144 or 144A promulgated under the
Securities Act (or any similar rule then in force) or (3) subject to the
conditions set forth in Section 4(d)(ii), any other legally available means of
transfer.
(ii) In connection with any transfer of any Warrants or Warrant
Shares described in Section 4(d)(i)(3), a Holder desiring to transfer Warrants
or Warrant Shares shall deliver written notice to the Company describing in
reasonable detail the proposed transfer, together with an opinion of counsel
(which, to the Company's reasonable satisfaction, is knowledgeable in securities
law matters) to the effect that such transfer may be effected without
registration of such shares under the Securities Act; provided that no such
opinion shall be required if there shall have been delivered to the Company an
opinion of counsel that no subsequent transfer of all Warrants or Warrant Shares
held by all Holders shall require registration under the Securities Act.
Promptly upon receipt of any opinion described in the proviso to the preceding
sentence,
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the Company shall prepare and deliver in connection with the consummation of the
proposed transfer, new certificates for the Warrants or Warrant Shares being
transferred that do not bear the legend set forth in Section 4(d)(iv). Transfers
to Affiliates are permitted as long as the legal opinion referred to in this
section is provided. Notwithstanding the foregoing, no legal opinion is required
for the transfer of any Warrant or Warrant Share to a Designated Affiliate. To
the extent that a transfer agent shall require an opinion or counsel for a
transfer pursuant to Section 4(d)(i)(2), the Company shall promptly provide such
opinion of counsel to the transfer agent in order to facilitate timely clearance
of the transfer.
(iii) No Warrant may be transferred prior to the Commencement Date
unless transferred from one Investor to another Investor or to a third party in
conjunction with an Investor selling all or a portion of its Commitment (as
defined under the Credit Agreement); provided, however, that the ratio
determined by dividing the number of Warrants transferred by an Investor
pursuant to this Section 4(d)(iii) by the number of Warrants held by such
Investor on May 15, 2001 must equal the ratio determined by dividing the amount
of Commitment sold by the Investor's original Commitment under the Credit
Agreement.
(iv) Except as provided in Sections 5(j) and 4(d)(ii), each
certificate for any Warrants or Warrant Shares shall be imprinted with a legend
substantially in the following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"SECURITIES ACT"). SUCH SECURITIES MAY NOT BE SOLD, TRANSFERRED,
PLEDGED OR HYPOTHECATED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FOR SUCH SECURITIES UNDER THE SECURITIES ACT OR UNLESS AN
EXEMPTION FROM REGISTRATION IS AVAILABLE OR AN OPINION OF COUNSEL WITH
RESPECT TO SUCH EXEMPTION IS PROVIDED TO THE EXTENT REQUIRED IN A
CERTAIN WARRANT AND REGISTRATION RIGHTS AGREEMENT DATED AS OF MAY 15,
2001, ENTERED INTO AMONG THE COMPANY AND CERTAIN HOLDERS OF SECURITIES
OF THE COMPANY.
(e) In addition to the legend required by Section 4(d)(iv), each
certificate for any Warrants or Warrant Shares shall be imprinted with a legend
substantially in the following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE
TERMS AND PROVISIONS OF A CERTAIN WARRANT AND REGISTRATION RIGHTS
AGREEMENT DATED AS OF MAY 15, 2001, ENTERED INTO AMONG THE COMPANY AND
CERTAIN HOLDERS OF SECURITIES OF THE COMPANY, A COPY OF WHICH IS ON
FILE AT THE COMPANY'S PRINCIPAL OFFICES. UPON WRITTEN REQUEST TO THE
COMPANY'S SECRETARY,
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A COPY OF SUCH AGREEMENT WILL BE PROVIDED WITHOUT CHARGE TO
APPROPRIATELY INTERESTED PERSONS.
Any legend endorsed on a certificate pursuant to Sections 4(d)(iv) and 4(e)
shall be removed if the securities represented thereby shall have been
effectively registered under the Securities Act and sold pursuant to an
effective registration statement or have been sold in compliance with Rule 144.
Section 5. Registration.
(a) Company Registration.
(i) If, on or after the Commencement Date and until May 15,
2006, the Company shall determine to Register any of its equity securities
either for its own account or for the account of any other Person, other
than a Registration relating solely to benefit plans, or a Registration
relating solely to a Commission Rule 145 transaction or on Form S-4, or a
Registration on any registration form which does not permit secondary sales
or does not include substantially the same information as would be required
to be included in a registration statement covering the sale of Registrable
Shares, the Company will:
(A) promptly give to each of the Holders a written notice thereof
(which shall include a list of the jurisdictions, if any, in which the
Company intends to attempt to qualify such securities under applicable
state securities laws); and
(B) include in such Registration (and any related qualification
under state securities laws or other compliance), and in any
underwriting involved therein, all the Registrable Shares specified in
a written request or requests, made by the Holders within ten (10)
business days after the giving of the written notice from the Company
described in clause (i) above, except as set forth in Section 5(a)(ii)
below. Such written request shall specify the amount of Registrable
Shares intended to be disposed of by a Holder and may specify all or a
part of the Holder's Registrable Shares.
Notwithstanding the foregoing, if, at any time after giving such written
notice of its intention to effect such Registration 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 equity securities the Company may, at its election, give written
notice of such determination to the Holders and thereupon the Company shall
be relieved of its obligation to Register such Registrable Shares in
connection with the Registration of such equity securities (but not from
its obligation to pay Registration Expenses to the extent incurred in
connection therewith as provided herein).
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(ii) Underwriting. If the Registration of which the Company
gives notice is for a Registered public offering involving an
underwriting, the Company shall so advise each of the Holders as a
part of the written notice given pursuant to Section 5(a)(i)(A). In
such event, the right of each of the Holders to Registration pursuant
to this Section 5(a) shall be conditioned upon such Holders'
participation in such underwriting and the inclusion of such Holders'
Registrable Shares in the underwriting to the extent provided herein.
The Holders whose shares are to be included in such Registration shall
(together with the Company and any other Person distributing their
securities through such underwriting) enter into an underwriting
agreement in customary form with the representative of the underwriter
or underwriters selected for the underwriting by the Company or such
other Persons, as the case may be. Such underwriting agreement will
contain such representations and warranties by the Company and such
other terms and provisions as are customarily contained in
underwriting agreements with respect to secondary distributions,
including, without limitation, indemnities and contribution and
customary lock-up periods required by the representative on terms no
more onerous than to any other parties to the underwriting agreement.
Notwithstanding any other provision of this Section 5(a), if the
representative determines that marketing factors require a limitation
on the number of shares to be underwritten, the Company shall so
advise all holders of securities requesting Registration, and the
number of shares of securities that are entitled to be included in the
Registration and underwriting shall be allocated in the following
manner:
(A) for the period beginning on the date hereof and ending on the
earlier of (x) February 16, 2003 and (y) the date that certain
Registration Rights Agreement (the "Connell Registration Rights
Agreement"), dated as of February 16, 2001, by and between the
Company and Connell Limited Partnership ("Connell"), terminates
in accordance with its terms,
(1) if a Registration as initially proposed was solely a
primary registration, then the Company shall include in
such Registration the number of shares proposed to be
registered by Connell before including the shares proposed
to be included by the Company for its own account the
Holders and each securityholder of the Company (other than
the Holders) that on the date hereof has rights to
piggyback registration upon a Company Registration, such
that the number of shares that may be included in the
Registration and underwriting by each of the Company the
Holders and such other securityholders shall be reduced on
a pro rata basis (based on the number of shares requested
to be registered by the Company, such Holders or such other
securityholders), by such minimum shares as is necessary to
comply with such limitation, and
(2) if such Registration as initially proposed was in whole
or in part a secondary registration, the number of shares
that may be included in the Registration and underwriting
by each of the Company, the Holders, each other
securityholder of the Company (other than the Holders) that
on the date hereof has rights to piggyback registration
upon a Company Registration and Connell shall be reduced,
on a pro rata basis (based on the number of shares
requested to be registered by the Company, such Holders,
such other securityholders or
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Connell), by such minimum shares as is necessary to comply
with such limitation;
Notwithstanding the foregoing, if a registration is a
demand pursuant to the Warrant and Registration Rights
Agreement (the "UK Registration Rights Agreement") of even
date herewith between the Company and the UK Banks (as
defined in Section 5(k)), the holders of warrants and
warrant shares pursuant to such agreement will be entitled
to the priority set forth in the demand registration
provisions of such agreement.
(B) for the period beginning upon the termination of the Connell
Registration Rights Agreement, the number of shares that may be
included in the Registration and underwriting by each of the
Company, the Holders and by each securityholder of the Company
(other than the Holders) that on the date hereof has rights to
piggyback registration upon a Company Registration shall be
reduced, on a pro rata basis (based on the number of shares
requested to be registered by the Company, such holders or such
other securityholders), by such minimum number of shares as is
necessary to comply with such limitation. Notwithstanding the
foregoing, if a registration is a demand pursuant to the (UK)
Registration Rights Agreement, the holders of warrants and
warrant shares pursuant to such agreement will be entitled to
priority set forth in the demand registration provision of such
agreement.
If any of the Holders or any officer, director or stockholder of the
Company other than a Holder disapproves of the terms of any such
underwriting, he may elect to withdraw therefrom by prompt written
notice to the Company and the underwriter. Any Registrable Shares or
other securities excluded or withdrawn from such underwriting shall be
withdrawn from such Registration.
(b) Demand Registration. The Company will provide a list of the names,
addresses and number of Warrants held of all current Holders within ten (10)
days of a written request of any Holder for such information. On or after the
Commencement Date, the holders of the Warrants and Warrant Shares may require
the Company to effect the registration of Warrant Shares. The right to request
registration under this Section 5(b) may be exercised on three (3) separate
occasions, only unless such request is withdrawn in accordance with the terms
hereof. The three (3) rights granted hereunder are distinct and separate from
any other rights to request registration which have been granted to any other
Person. A request may be delivered prior to the Commencement Date; provided
that the registration statement does not have to be declared effective until
after such date. A shelf registration may be demanded pursuant to this Section
5(b). These demand registration rights may only be exercised if the holders of
a majority of Warrant Shares (whether or not the Warrant Shares have been
issued) (the "Majority Holders") shall give notice to the Company to the effect
that holders of Warrants or Warrant Shares intend to (i) transfer all or any
part of the Warrant Shares or (ii) exercise all or any part of the Warrant and
transfer all or any part of the Warrant Shares under such circumstances that a
public distribution (within the meaning of the Securities Act) of the Warrant
Shares will be involved, then the Company (A) within ten (10) days after receipt
of such notice shall give written notice of the proposed registration pursuant
to this Section 5(b) to the other holders of Warrants and Warrant Shares and (B)
within thirty (30) days after receipt of such notice from the Majority Holders,
shall file a registration statement pursuant to the Securities Act to the end
that all Warrant Shares the holders of which requested registration thereof
either pursuant to the original notice from the Majority Holders given pursuant
to this sentence or by written notice given to the Company during such 30-day
period, may be sold under the Securities Act as promptly as is practicable
thereafter. The Company shall use commercially reasonable efforts to cause any
such registration to become effective and to keep the prospectus included
therein current for ninety (90) days; provided, however, that such holders shall
furnish the Company with such appropriate information as is required in
connection with such registration as the Company may
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reasonably request in writing and that such holders shall comply with Section 8
of this Agreement.
If the managing underwriter for any offering made pursuant to this Section
5(b) (who shall be selected by the Majority Holders, subject to the consent of
the Company, which shall not be unreasonably withheld) advises the Company in
writing that, in its opinion, the inclusion of all of the Warrant Shares
requested to be included in such registration by the holders of Warrants and
Warrant Shares would materially adversely affect the distribution of all such
securities, then there shall be included in such registration shares of the
holders of Warrants or Warrant Shares pro rata based on the number of shares
originally proposed to be registered by each holder of Warrants or Warrant
Shares and no other Common Shares shall be included in such registration. A
registration will not count as a demand registration under this Section 5(b)
until it has become effective and the holders of the Warrants or Warrant Shares
participating in the demand registration are able to register and sell at least
50% of the Warrant Shares originally requested to be included in such
registration. The Company agrees to enter into an underwriting agreement in
customary form with the managing underwriter. Such underwriting agreement will
contain such representations and warranties by the Company and such other terms
and provisions as are customarily contained in underwriting agreements with
respect to secondary distributions, including, without limitation, indemnities
and contribution.
(c) Suspension Right. Notwithstanding the provisions of Sections 5(a) and
(b), if the Board of Directors of the Company determines in good faith that the
filing of a registration statement or any supplement or amendment thereto would
interfere with the negotiation or completion of a material transaction or event
being contemplated by the Company, the Company shall have the right to (the
"Suspension Right"), by notice to the Holders in accordance with Section 11(d),
defer the filing of a registration statement to effect the demand registration
or suspend the rights of the Holders to make sales pursuant to the demand
registration for such a period of time as the Board of Directors may determine;
provided that no such period of deferral or suspension may exceed 60 consecutive
days and that all such periods of deferral or suspension may not exceed 120 days
in the aggregate during any period of 12 consecutive months.
(d) Notices. The Company shall promptly notify the Holders of Registrable
Shares covered by the demand registration of the occurrence of the following
events:
(i) when the demand registration or post-effective amendment
thereto filed with the Commission has become effective;
(ii) the issuance by the Commission of any stop order suspending
the effectiveness of the demand registration;
(iii) the suspension of sales under the demand registration by
the Company in accordance with Section 5(c) above;
(iv) the Company's receipt of any notification of the suspension
of the qualification of any Registrable Shares covered by the demand
registration for sale in any jurisdiction; and
11
(v) the existence of any event, fact or circumstance that results
in the registration statement evidencing the demand registration or
prospectus relating to Registrable Shares or any document incorporated
therein by reference containing an untrue statement of material fact or
omitting to state a material fact required to be stated therein or
necessary to make the statements therein not misleading during the
distribution of securities.
The Company agrees to use commercially reasonable efforts to obtain the
withdrawal of any order suspending the effectiveness of any such registration
statement or any state qualification at the earliest possible moment.
(e) Registration Statement; Amendments and Supplements. The Company shall
provide to the Holders of Registrable Shares covered by a registration, at no
cost to such Holders, such reasonable number of copies as each Holder may
request of the related registration statement and any amendment thereto used to
effect the Registration of the Registrable Shares, each prospectus contained in
such registration statement or post-effective amendment and any amendment or
supplement thereto and such other documents as the requesting Holders may
reasonably request in order to facilitate the disposition of the Registrable
Shares covered by such registration statement. The Company consents to the use
of each such prospectus and any supplement thereto by the Holders in connection
with the offering and sale of the Registrable Shares covered by such
registration statement or any amendment thereto. The Company shall also file a
sufficient number of copies of the prospectus and any post-effective amendment
or supplement thereto with NYSE (or, if the Common Shares are no longer listed
thereon, with such other securities exchange or market on which the Common
Shares are then listed) so as to enable the Holders to have the benefits of the
prospectus delivery provisions of Rule 153 under the Securities Act, if
applicable.
(f) State Securities Laws. The Company agrees to use commercially
reasonable efforts to cause the Registrable Shares covered by a registration
statement to be registered with or approved by such state or Bermuda securities
authorities as may be necessary to enable the Holders to consummate the
disposition of such shares pursuant to the plan of distribution set forth in the
registration statement; provided, however, that the Company shall not be
obligated to take any action to effect any such Registration, qualification or
compliance pursuant to this Section 5 in any particular jurisdiction in which
the Company would be required to (i) execute a general consent to service of
process in effecting such Registration, qualification or compliance unless the
Company is already subject to service in such jurisdiction or to (ii) file a tax
return.
(g) Remediation of Misstatements or Omissions. Subject to the Company's
Suspension Right, if any event, fact or circumstance requiring an amendment to a
registration statement relating to the Registrable Shares or supplement to a
prospectus relating to the Registrable Shares shall exist, immediately upon
becoming aware thereof the Company agrees to notify the Holders and prepare and
furnish to the Holders a post-effective amendment to the registration statement
or supplement to the prospectus or any document incorporated therein by
reference or file any other required document so that, as thereafter delivered
to the purchasers of the Registrable Shares, the prospectus will not contain an
untrue statement of a material fact or
12
omit to state any material fact required to be stated therein or necessary to
make the statements therein not misleading.
(h) Listing on Exchange. The Company agrees to use commercially reasonable
efforts (including the payment of any listing fees) to obtain the listing of all
Registrable Shares covered by the registration statement on each securities
exchange on which securities of the same class are then listed.
(i) Compliance with Securities Laws. The Company agrees to use
commercially reasonable best efforts to comply with the Securities Act and the
Exchange Act in connection with the offer and sale of Registrable Shares
pursuant to a registration statement, and, as soon as reasonably practicable
following the end of any fiscal year during which a registration statement
effecting a Registration of the Registrable Shares shall have been effective, to
make available to its security holders an earnings statement satisfying the
provisions of Section 11(a) of the Securities Act and Rule 158 thereunder.
(j) Share Certificates. The Company agrees to: (x) cooperate with the
selling Holders to facilitate the timely preparation and delivery of
certificates representing Registrable Shares to be sold pursuant to a
Registration and not bearing any Securities Act legend; and (y) enable
certificates for such Registrable Shares to be issued for such numbers of shares
and registered in such names as the Holders may reasonably request at least two
business days prior to any sale of Registrable Shares. Each Holder requesting
delivery of certificates not bearing any Securities Act legend shall provide
appropriate representations to the Company of such Holder's intent to comply
with all conditions necessary for sale pursuant to a Registration, including
prospectus delivery requirements.
(k) Other Registration Rights. Prior to the date hereof, the Company
issued certain registration rights pursuant to the Connell Registration Rights
Agreement and pursuant to the Company Rights Plan. The Company agrees not to
grant registration rights to any other holder of Common Shares or securities
exercisable or convertible into common shares without the written consent of the
holders of Warrants and Warrant Shares representing 60% of the Warrant Shares
issuable hereunder, excluding any Warrant Shares sold to the public pursuant to
an effective registration statement or Rule 144 under the Securities Act, except
that
(i) the Company may grant registration rights pursuant to a
Warrant and Registration Rights Agreement of even date herewith between the
Company and the Royal Bank of Scotland and National Westminster PLC
(collectively, the "UK Banks"); provided that such rights do not conflict
with the cutback prorations and demand registration provisions set forth in
this Section 5; and
(ii) the Company may grant piggyback registration rights on a
Company registration (but not on a demand registration pursuant to Section
5(b)) to any other party as long as such party may only participate in a
registration to the extent that all Registrable Shares requested to be
included by the Holders are included.
13
Section 6. Expenses of Registration. The Company shall pay all
Registration Expenses incurred in connection with the registration,
qualification or compliance pursuant to Section 5 hereof. All Selling Expenses
incurred in connection with the offer and sale of Registrable Shares by any of
the Holders shall be borne by the Holder offering or selling such Registrable
Shares.
Section 7. Indemnification.
(a) The Company will indemnify each Holder, each Holder's officers and
directors, each person controlling such Holder within the meaning of Section 15
of the Securities Act and each underwriter, if any, of the Company's securities
covered by any Registration hereunder against all expenses, claims, losses,
damages and liabilities (including reasonable legal fees and expenses), arising
out of or based on any untrue statement (or alleged untrue statement) of a
material fact contained in any registration statement or prospectus relating to
the Registrable Shares, or any amendment or supplement thereto, or based on any
omission (or alleged omission) to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading;
provided, however, that the Company will not be liable in any such case to the
extent that any such claim, loss, damage, liability or expense arises out of or
is based on any untrue statement or omission or alleged untrue statement or
omission, made in reliance upon and in conformity with information furnished in
writing to the Company by such Holder or underwriter for inclusion therein.
(b) Each Holder will indemnify the Company, each of its directors and each
of its officers who signs the registration statement and each person who
controls the Company within the meaning of Section 15 of the Securities Act
against all claims, losses, damages and liabilities (including reasonable legal
fees and expenses) arising out of or based on any untrue statement (or alleged
untrue statement) of a material fact contained in any such registration
statement or prospectus, or any amendment or supplement thereto, or based on any
omission (or alleged omission) to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading, in
each case to the extent, but only to the extent, that such untrue statement (or
alleged untrue statement) or omission (or alleged omission) is made in such
registration statement or prospectus in reliance upon and in conformity with
information furnished in writing to the Company by such Holder for inclusion
therein and provided further that such indemnification shall be limited to the
amount of proceeds such Holder received from the sale of Common Shares pursuant
to such registration.
(c) Each party entitled to indemnification under this Section 7 (the
"Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought, but the
omission to so notify the Indemnifying Party shall not relieve it from any
liability which it may have to the Indemnified Party pursuant to the provisions
of this Section 7 except to the extent of the actual damages suffered by such
delay in notification. The Indemnifying Party shall assume the defense of such
action, including the employment of counsel to be chosen by the Indemnifying
Party, which counsel must be reasonably satisfactory to the Indemnified Party,
and payment of reasonable expenses. The Indemnified Party shall have the right
to employ its own counsel in any such case, but the reasonable legal fees and
expenses
14
of such counsel shall be at the expense of the Indemnified Party, unless the
employment of such counsel shall have been authorized in writing by the
Indemnifying Party in connection with the defense of such action, or the
Indemnifying Party shall not have employed counsel to take charge of the defense
of such action, or the Indemnified Party shall have reasonably concluded that
there may be defenses available to it or them which are different from or
additional to those available to the Indemnifying Party (in which case the
Indemnifying Party shall not have the right to direct the defense of such action
on behalf of the Indemnified Party), in any of which events such reasonable fees
and expenses shall be borne by the Indemnifying Party. No Indemnifying Party, in
the defense of any such claim or litigation, shall, except with the consent of
each Indemnified Party, consent to entry of any judgment or enter into any
settlement which does not include as an unconditional term thereof the giving by
the claimant or plaintiff to such Indemnified Party of a release from all
liability in respect to such claim or litigation.
(d) If the indemnification provided for in this Section 7 is unavailable to
a party that would have been an Indemnified Party under this Section 7 in
respect of any expenses, claims, losses, damages and liabilities referred to
herein, then each party that would have been an Indemnifying Party hereunder
shall, in lieu of indemnifying such Indemnified Party, contribute to the amount
paid or payable by such Indemnified Party as a result of such expenses, claims,
losses, damages and liabilities in such proportion as is appropriate to reflect
the relative fault of the Indemnifying Party on the one hand and such
Indemnified Party on the other in connection with the statement or omission
which resulted in such expenses, claims, losses, damages and liabilities, as
well as any other relevant equitable considerations. The relative fault 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 Indemnifying Party or
such Indemnified Party and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and each holder of Registrable Shares agrees that it would not be
just and equitable if contribution pursuant to this Section were determined by
pro rata allocation or by any other method of allocation which does not take
account of the equitable considerations referred to above in this Section 7(d).
(e) 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.
(f) In no event shall any Holder be liable for any expenses, claims,
losses, damages or liabilities pursuant to this Section 7 in excess of the net
proceeds to such Holder of any Registrable Shares sold by such Holder.
Section 8. Obligations of Holders. It shall be a condition precedent to
the obligations of the Company to take any action pursuant to Section 5 that
each Holder shall:
(a) cooperate with the Company, its counsel, advisors and other
representatives, and comply with all applicable provisions of law
(including, without limitation, the prospectus delivery requirements of the
Securities Act and Rule 10b-5 and Regulation M
15
under the Exchange Act) in connection with any registration effected
pursuant to the provisions of this Agreement;
(b) promptly provide to the Company, in writing, such information as
the Company or its counsel deems necessary for inclusion in the
registration statement, which information, when given, shall be true and
correct in all material respects and shall not omit any information
necessary to make the information furnished not misleading;
(c) execute all questionnaires, powers of attorney or other documents
as the Company may reasonably request;
(d) discontinue sales of Registrable Securities upon notification of
any stop order or suspension of the effectiveness of the registration
statement;
(e) notify the Company immediately upon any material change in the
plan of distribution or other information concerning such Holder described
in the prospectus;
(f) discontinue sales of Registrable Securities and use of the related
prospectus following notification by the Company that the registration
statement must be amended or supplemented. The Company shall promptly file
such amendment or supplement;
(g) not use any prospectus other than the most recent prospectus
reasonably known to such Holder related to the registration statement; and
(h) upon presentation of a stock certificate representing Registrable
Securities sold in such registration, certify that the sale was made in
accordance with the terms hereof and the plan of distribution described in
the prospectus relating thereto.
If any Holder fails to provide the Company with such information within ten (10)
days of the Company's request, the Company's obligations under Section 5 hereof
with respect to such Holder or the Registrable Shares owned by such Holder shall
be suspended until such Holder provides such information, provided, however,
that if a Holder provides any such information too late to be reasonably
included in such Registration, the Company's obligations under Section 5 with
respect to such Holder or the Registrable Shares owned by such Holder shall be
terminated with respect to such Registration.
Section 9. Rule 144 Sales.
(a) The Company covenants that it will file any and all reports required to
be filed by the Company under the Exchange Act so as to enable any Holder to
sell Registrable Shares pursuant to Rule 144 under the Securities Act.
(b) In connection with any sale, transfer or other disposition by any
Holder of any Registrable Shares pursuant to Rule 144 under the Securities Act,
the Company shall cooperate with such Holder to facilitate the timely
preparation and delivery of certificates representing Registrable Shares to be
sold and not bearing any Securities Act legend, if deemed appropriate, and
enable certificates for such Registrable Shares to be for such number of shares
and registered
16
in such names as the selling Holder may reasonably request, provided that such
request is made at least two business days prior to any sale of Registrable
Shares.
Section 10. Warrant Reduction. The number of Warrant Shares issuable
under the Warrants shall be reduced by half if the Administrative Agent under
the Credit Agreement and the agent under the credit facilities dated as of May
15, 2001 among certain of the Company's subsidiaries and the UK Banks (the "UK
Credit Facilities") certify that the combined commitments under the Credit
Agreement and the UK Credit Facilities is reduced by $320 million by August 30,
2002. Such certification shall be filed with the Secretary of the Company by
the close of business Bermuda time on August 30, 2002, with copies sent to all
Holders as soon as practicable thereafter. Upon the receipt of such
certification by the Secretary of the Company, each Warrant Certificate shall
automatically represent one-half of the Warrants indicated on the first page of
the Warrant Certificate (as adjusted from time to time as provided therein).
Upon notification to the Holders that a reduction has occurred and upon the
filing of such certification, no further action is required to effect the
reduction. In the event a reduction is effected in accordance herewith, upon
the request of any Holder and the surrender of such Holder's Warrant
Certificate, the Company shall prepare and deliver a new Warrant Certificate
with the appropriate number of Warrants.
Section 11. Miscellaneous.
(a) Governing Law. This Agreement shall be governed in all respects by the
internal laws of the State of Illinois.
(b) Entire Agreement. This Agreement constitutes the full and entire
understanding and agreement between the parties with regard to the subject
matter hereof.
(c) Amendment. No supplement, modification, waiver or termination of this
Agreement (including without limitation any amendment or modification of any
defined term used herein which is defined in any other agreement or instrument
referred to herein) shall be binding unless agreed to in writing by the Company
and the holders of Warrants and Warrant Shares representing 60% of the Warrant
Shares issuable hereunder, excluding any Warrant Shares sold to the public
pursuant to an effective registration statement or Rule 144 under the Securities
Act.
(d) Notices, etc. Each notice, demand, request, request for approval,
consent, approval, disapproval, designation or other communication (each of the
foregoing being referred to herein as a notice) required or desired to be given
or made under this Agreement shall be in writing (except as otherwise provided
in this Agreement), and shall be effective and deemed to have been received (i)
when delivered in person, (ii) when sent by fax with receipt acknowledged, (iii)
five (5) days after having been mailed by certified or registered United States
mail (mailed within the United States), postage prepaid, return receipt
requested, or (iv) the next business day after having been sent by an
internationally recognized overnight mail or courier service, receipt requested.
Notices shall be addressed as follows: (x) if to any Holder, at such address or
fax number as such Holder shall have furnished the Company in writing (or, if
such Holder is a Lender, at such Holder's address set forth in the Credit
Agreement), or (y) if to the
17
Company, at the address or fax number of its principal executive offices set
forth below its signature hereon or at such other address or fax number as the
Company shall have furnished to the Investors. Any notice or other communication
required to be given hereunder to a Holder in connection with a registration may
instead be given to the designated representative of such Holder.
(e) Counterparts. This Agreement may be executed in any number of
counterparts, each of which may be executed by fewer than all of the parties
hereto, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together shall constitute one
instrument.
(f) Severability. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision.
(g) Captions. Captions are for descriptive purposes only and shall not
control or alter the meaning of this Agreement as set forth in the text.
(h) Successors and Assigns. This Agreement shall be binding upon the
parties hereto and their respective successors and assigns. Whether or not any
express assignment has been made in this Agreement, the provisions of this
Agreement that are for the Lenders as holders of Registrable Shares are also for
the benefit of, and shall be enforceable by, all subsequent holders of
Registrable Shares.
(i) Remedies. The Company and the Investors acknowledge that there would
be no adequate remedy at law if any Person fails to perform any of its
obligations hereunder, and accordingly agree that the Company and each Holder,
in addition to any other remedy to which it may be entitled at law or in equity,
shall be entitled to compel specific performance of the obligations of another
party under this Agreement in accordance with the terms and conditions of this
Agreement in any court of the United States or any State thereof having
jurisdiction.
(j) Attorneys' Fees. If the Company or any Holder brings an action to
enforce its rights under this Agreement, the prevailing party in the action
shall be entitled to recover its costs and expenses, including, without
limitation, reasonable attorneys' fees and expenses, incurred in connection with
such action, including any appeal of such action.
(k) No Inconsistent Agreements. The Company will not hereafter enter into
any agreement with respect to its securities which is inconsistent with the
rights granted to the Holders of Registrable Shares in this Agreement.
(l) Survival of Representations and Warranties. All representations and
warranties contained herein shall survive the execution and delivery of this
Agreement and any transfer of any Warrant or Common Shares issued upon exercise
thereof.
(m) Credit Agreement and Warrant Certificates. Nothing in this Agreement
or Exhibit A is intended to permit any action or event which is prohibited by
the Credit Agreement or by
18
the Warrant Certificates, as long as the Credit Agreement or the Warrant
Certificates, respectively, remain in effect.
19
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date first above written.
COMPANY:
APW LTD.
By: ___________________________________
Its: ___________________________________
Attention:
Facsimile:
LENDERS:
BANK OF AMERICA, NATIONAL ASSOCIATION,
as Administrative Agent and a Bank
By:
Title:
Attention:
Facsimile:
BANK ONE, NA (Main Office Chicago),
as Syndication Agent and as a Bank
By:
Name:
Title:
Attention:
Facsimile:
THE CHASE MANHATTAN BANK,
as Documentation Agent and a Bank
By:
Name:
Title:
Attention:
Facsimile:
FIRST UNION NATIONAL BANK,
as a Bank
By:
Name:
Title:
Attention:
Facsimile:
20
LASALLE BANK NATIONAL ASSOCIATION,
as a Bank
By:___________________________
Name:
Title: ________________________
Attention:
Facsimile:
THE ROYAL BANK OF SCOTLAND PLC,
as a Bank
By:______________________________
Name:
Title: ___________________________
Attention:
Facsimile:
THE BANK OF TOKYO-MITSUBISHI, LTD.,
CHICAGO BRANCH, as a Bank
By: _____________________________
Name:
Title: ___________________________
Attention:
Facsimile:
CREDIT LYONNAIS CHICAGO BRANCH,
as a Bank
By: _______________________________
Name:
Title: _____________________________
Attention:
Facsimile:
U.S. BANK NATIONAL ASSOCIATION,
as a Bank
By: _____________________________
Name:
Title:
Attention:
Facsimile:
FIRSTAR BANK, N.A.,
as a Bank
By:
Name:
Title: _________________________
Its Attorney-In-Fact
Attention:
Facsimile:
THE FUJI BANK, LIMITED,
as a Bank
By: __________________________
Name:
Title:
Attention:
Facsimile:
21
FLEET NATIONAL BANK,
as a Bank
By:
Name:
Title:
Attention:
Facsimile:
THE DAI-ICHI KANGYO BANK, LTD.,
as a Bank
By:
Name:
Title:
Attention:
Facsimile:
M&I MARSHALL & ILSLEY BANK,
as a Bank
By: ___________________________
Name:
Title:
By:
Name:
Title: _________________________
Attention:
Facsimile:
BNP PARIBAS,
as a Bank
By:
Name:
Title: ______________________
By:
Name:
Title:
Attention:
Facsimile:
SOCIETE GENERALE,
as a Bank
By:_________________________
Name:
Title: _______________________
Attention:
Facsimile:
THE BANK OF NEW YORK,
as a Bank
By: __________________________
Name:
Title: ________________________
Attention:
Facsimile:
22
WACHOVIA BANK, N.A.,
as a Bank
By: __________________________
Name:
Title: ________________________
Attention:
Facsimile:
SUMITOMO MITSUI BANKING CORPORATION
as a Bank
By: ___________________________
Name:
Title: _________________________
Attention:
Facsimile:
THE MITSUBISHI TRUST & BANKING CORPORATION,
as a Bank
By: __________________________
Name:
Title:
Attention:
Facsimile:
Schedule 3(d)
List of APW Ltd. Options Plan
APW Ltd. 2000 Stock Option Plan
APW Ltd. 2001 Stock Option Plan
APW Ltd. Outside Director Stock Option Plan
APW Ltd. also has an employee stock purchase plan allowing employees to
purchase Common Shares at a discount.
23