Exhibit 10.3
SECOND AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT
This SECOND AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (this
"AGREEMENT") is made and entered into as of November 7, 1996, by and between
International Logistics Limited, a Delaware corporation (the "COMPANY"), and
each of the Investors listed on EXHIBIT A hereto (singularly an "INVESTOR" and
collectively, the "INVESTORS").
In consideration of the agreements and mutual covenants set forth
herein, the parties hereby agree as follows:
SECTION 1. DEFINITIONS. As used in this Agreement, the following
terms shall have the following meanings, and capitalized terms not otherwise
defined herein have the meanings assigned to them in that certain Stockholders
Agreement dated as of even date herewith, among the Company and the Investors,
as the same may be modified or amended from time to time:
"AFFILIATE" of a Holder means any Person which directly or indirectly
controls, is controlled by, or is under common control with such Holder.
"Control," "controlled by" and "under common control with" means direct or
indirect possession of the power to direct or cause the direction of management
or policies (whether through ownership of voting securities, by contract or
otherwise); PROVIDED that control shall be conclusively presumed when any Person
or entity or affiliated group directly or indirectly owns ten percent (10%) or
more of the securities having ordinary voting power for the election of a
majority of the directors of a corporation.
"AGREEMENT" shall have the meaning assigned to such term in the
introductory paragraph hereof.
"CLOSING DATE" means November 7, 1996.
"COMMISSION" means the Securities and Exchange Commission, or any
other federal agency then administering the Securities Act and the Exchange Act.
"COMMON STOCK" means the common stock, $.001 par value per share, of
the Company.
"COMPANY" shall have the meaning assigned to such term in the
introductory paragraph hereof.
"CONTROLLING PERSON" shall have the meaning assigned to such term in
SECTION 9.
"CUTBACK" shall have the meaning assigned to such term in SECTION
3(C)(II).
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
or any similar Federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect from time to time.
"FAMILY MEMBER" means any Holder's spouse, siblings, children,
children's spouses, grandchildren or their spouses or any trusts for the benefit
of any of the foregoing.
"HOLDER" means any Investor who holds any shares of Common Stock
entitled to registration rights hereunder.
"ING" means Internationale Nederlanden (U.S.) Capital Corporation.
"ING HOLDERS" shall mean the Holders of the ING Shares.
"ING SHARES" means all the Common Stock now and hereafter held by ING.
"INDEMNIFIED PARTY" shall have the meaning assigned to such term in
SECTION 9.
"INDEMNIFYING PARTY" shall have the meaning assigned to such term in
SECTION 9.
"INITIAL PUBLIC OFFERING" means the first underwritten public offering
of Common Stock by the Company pursuant to a registration of shares under the
Securities Act on a Form S-1 Registration Statement (or equivalent or successor
form).
"LOSSES" means all losses, claims, damages or liabilities (other than
consequential damages or incidental lost profits) and reasonable costs and
expenses related thereto.
"MYERS" shall mean William E. Myers, Jr. and any Myers Affiliate.
"MYERS AFFILIATE" shall mean any (i) bona fide officer, director,
shareholder or employee of W.E. Myers & Company reasonably acceptable to the
Company, (ii) Family Member of any of the foregoing individuals and (iii)
partnership, corporation, trust or other entity controlled by William E. Myers,
Jr.
"MYERS SHARES" means all the Common Stock now and hereafter held by
Myers; PROVIDED, HOWEVER, that all Warrants convertible or exercisable into
shares of Common Stock pursuant to the Warrants held by Myers shall constitute
"WES&S Shares" so
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long as Myers exercises such warrants prior to the date when the Commission
declares effective any registration statement pursuant to a Public Offering
under which such shares are registered.
"OCM" means OCM Principal Opportunities Fund, L.P., a Delaware limited
partnership.
"OCM SHARES" means all the Common Stock now and hereafter held by OCM
and any OCM Affiliate.
"OCM HOLDERS" shall mean the Holders of the (a) OCM Shares and (b) TCW
Shares. Upon the occurrence of any Cutback (as defined in Section 3(c)(ii)
below) hereunder with respect to the OCM Shares, such Cutback shall be allocated
to the TCW Shares in the same percentage Cutback as applied to the OCM Shares
pursuant to the applicable offering.
"OCM AFFILIATE" means any investor in or any employee of OCM, TCW
Asset Management Company, a California corporation ("TAMCO"), Trust Company of
the West, a California trust company ("TRUSTCO") or Oaktree Capital Management,
LLC ("OAKTREE"), a California limited liability company, or in any company,
joint venture, limited liability company, association or partnership of which
the OCM, TAMCO, Trustco or Oaktree, is a shareholder, manager or general
partner, as the case may be.
"PARIBAS" means Banque Paribas.
"PARIBAS HOLDERS" shall mean the Holders of the Paribas Shares.
"PARIBAS SHARES" means all the Common Stock now and hereafter held by
Paribas.
"PERSON" shall mean any individual, corporation, partnership, limited
liability company, joint venture, association, joint stock company, trust,
unincorporated organization or government or agency or political subdivision
thereof.
"PIGGYBACK RIGHT" shall have the meaning assigned to such term in
SECTION 3(H).
"PUBLIC OFFERING" means any offering of Common Stock to the public,
including the Initial Public Offering, either on behalf of the Company or any of
its stockholders, pursuant to an effective registration statement.
"REGISTRATION EXPENSES" shall have the meaning assigned to such term
in SECTION 7(A).
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"SECURITIES" shall mean the shares of Common Stock and any securities
convertible or exercisable into shares of Common Stock, and whenever an amount
of Securities is calculated or used in any provision of this Agreement,
convertible or exercisable securities shall be counted as the number of shares
of Common Stock issuable upon such conversion or exercise.
"SECURITIES ACT" means the Securities Act of 1933, as amended, or any
similar Federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect from time to time.
"SELL-DOWN EVENT" means an event, subject to SECTIONS 2, 3 AND 4 of
the Stockholders Agreement, whereby WES&S sells or Transfers Securities (or an
economic "capital interest" therein, whether directly or indirectly) to any
Person; PROVIDED, HOWEVER, that the following Transfers shall not constitute a
Sell-Down Event: (i) any Transfer made to a WES&S Affiliate or (ii) any Transfer
made to any Person if (A) WES&S retains voting control of the Securities
transferred to such Person and (B) the cumulative number of Securities so
transferred (or the economic capital interest therein) by WES&S shall not exceed
the Threshold Amount.
"SIMON ENTITY" means Logistical Simon, L.L.C., a Delaware limited
liability company, WESINVEST, Inc., a Delaware corporation or William E. Simon &
Sons, L.L.C., a Delaware limited liability company.
"STOCKHOLDERS AGREEMENT" means the Second Amended and Restated
Stockholders Agreement dated as of November 7, 1996 by and among the Company and
each of the other Holders listed on EXHIBIT A thereto, as the same may be
amended from time to time.
"THRESHOLD AMOUNT" means thirty percent (30%) of the shares held by
WES&S as of the Closing Date (excluding for the purpose of this calculation any
shares owned by WES&S to the extent received upon the exercise of its Warrants
or otherwise acquired from parties other than the Company).
"TCW" means TCW Special Credits Fund V - The Principal Fund, a
California limited partnership.
"TCW SHARES" means all the Common Stock now and hereafter held by TCW
and any TCW Affiliate.
"TCW AFFILIATE" means any investor in or any employee of TCW, TCW
Asset Management Company, a California corporation ("TAMCO"), Trust Company of
the West, a California trust company ("TRUSTCO") or Oaktree Capital Management,
LLC ("OAKTREE"), a California limited liability company, or in any company,
joint
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venture, limited liability company, association or partnership of which TCW,
TAMCO, Trustco or Oaktree, is a shareholder, manager or general partner, as the
case may be.
"WARRANT(S)" has the meaning assigned to such term in the Stockholders
Agreement.
"WARRANTHOLDER" means any Investor who holds any Warrants.
"WES&S" means Logistical Simon, L.L.C., a Delaware limited liability
company.
"WES&S SHARES" means the shares of Common Stock now and hereafter
held by WES&S and any WES&S Affiliate; PROVIDED, HOWEVER, that all Warrants
convertible or exercisable into shares of Common Stock pursuant to the Warrants
held by WES&S or any WES&S Affiliate shall constitute "WES&S Shares" so long as
WES&S or a WES&S Affiliate exercises such warrants prior to the date that the
Commission declares effective any registration statement pursuant to a Public
Offering under which such shares are registered.
"WES&S HOLDERS" shall mean the Holders of the (a) WES&S Shares and (b)
and the Myers Shares. Upon the occurrence of any Cutback (as defined in Section
3(c)(ii) below) hereunder with respect to the WES&S Shares, such Cutback shall
be allocated to the Myers Shares in the same percentage Cutback as applied to
the WES&S Shares pursuant to the applicable offering.
"WES&S AFFILIATE" means any Simon Entity or any partnership, limited
liability company or corporation that directly or indirectly, through one or
more intermediaries, has control of, is controlled by or is under common control
with (i) any Simon Entity or (ii) any shareholder, partner or member of a Simon
Entity or any such shareholder's, partner's or member's spouse, siblings,
children, children's spouses, grandchildren or their spouses or any trusts for
the benefit of any of the foregoing.
SECTION 2. ACKNOWLEDGEMENT OF RIGHTS. The Company will, upon request
of a Holder, acknowledge in writing the Company's obligation in respect of the
rights to which a Holder shall be entitled under this Agreement, PROVIDED that
the failure of a Holder to make any such request shall not affect the continuing
obligation of the Company to the Holder in respect of such rights.
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SECTION 3. DEMAND REGISTRATION.
(a) Subject to the limitations contained in SECTION 5 and SECTION 6,
at any time on or after November 2, 1999, the OCM Holders representing a
majority of the Common Stock so held or the WES&S Holders representing a
majority of the Securities so held may give written notice to the Company
requesting the registration of such number of shares of Common Stock as shall be
requested by such requesting Holder (the "DEMAND NOTICE"), and thereupon, the
Company shall, as expeditiously as possible, prepare and file a registration
statement under the Securities Act covering the shares specified in such Demand
Notice, and shall use its best efforts to cause such registration statement to
become effective, all in accordance with the provisions of this Agreement;
PROVIDED that the Company shall be obligated to effect registration pursuant to
this SECTION 3(A) no more than two times for each of the OCM Holders and the
WES&S Holders.
(b) Whenever the Company shall have received a demand pursuant to
SECTION 3(A) above to effect the registration of any shares, the Company shall
promptly give written notice to: (i) in the event such requesting Holder holds a
majority of the Securities held by all OCM Holders, any other OCM Holder and to
the WES&S Holders, (ii) in the event such requesting Holder holds a majority of
the Securities held by all WES&S Holders, any other WES&S Holder and the OCM
Holders; (iii) the Paribas Holders; and (iv) the ING Holders, and allow each
such Holder the opportunity to participate in such registration. Each such
Holder may, within ten (10) days after receipt of such notice, request in
writing that all of such Holder's shares, or any portion thereof designated by
such Holder, be included in the offering.
(c) The Company shall proceed as expeditiously as possible after
receipt of a demand pursuant to SECTION 3(A) above to file a registration
statement and use its best efforts to effect, within ninety (90) days of the
date of the Demand Notice, the registration of an offering under the Securities
Act, such registration statement to be declared effective by the Commission not
later than one hundred and eighty (180) days from the date of such Demand Notice
under this SECTION 3. Such offering shall include:
(i) the shares specified in the Demand Notice given pursuant to
SECTION 3(A) above; and
(ii) all shares that other Holders have requested be included in
the offering pursuant to SECTION 3(B) above;
all to the extent required to permit the OCM Holders, the WES&S Holders, the
Paribas Holders and the ING Holders, as the case may be, to dispose of such
shares in compliance with applicable law;
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PROVIDED HOWEVER, that if the managing underwriter of such offering shall have
determined that the inclusion of any shares pursuant to SECTION 3(B) above shall
adversely affect the price, terms or number of securities to be underwritten and
sold on behalf of the Holders initiating such demand registration pursuant to
SECTION 3(A) above, then all Holders still desiring to participate in such
registration shall be subject to a reduction in the number of shares included in
such demand registration on a pro-rata basis (a "CUTBACK"). Holders of shares
(other than the Paribas Holders and the ING Holders) which either (i) elect to
withdraw from such registration because of the Cutback or (ii) participate in
the registration but have shares which are Cutback, shall in any case retain
their demand registration rights with respect to the shares which are so
withdrawn or Cutback. No other outstanding securities of the Company shall be
included in such demand registration. Notwithstanding the foregoing, if the OCM
Holders experience any Cutback due to the inclusion of the Myers Shares in such
demand registration, then additional WES&S Shares shall be Cutback so that there
is no incremental Cutback experienced by the OCM Holders by virtue of inclusion
of the Myers Shares in such demand registration.
(d) A registration statement filed pursuant to this SECTION 3 shall
remain effective until the first to occur of (i) the sale of all of the shares
registered under such registration statement or (ii) the date two years
following the date such registration statement was declared effective by the
Commission, excluding any periods during which the Commission shall have issued
any stop order with respect to such registration statement. If the registration
statement is part of a shelf offering, the Company shall be obligated to keep
such registration statement effective for a period of not less than two years.
(e) The Holders electing to participate in such offering shall have
the right to select the managing underwriter to be engaged in connection with
any such registration subject to the approval of the Company (which approval
shall not be unreasonably withheld). Any such underwriter shall be a member
firm of the New York Stock Exchange with a net capital of at least One-Hundred
Million Dollars ($100,000,000).
(f) If, at any time prior to the effectiveness of the registration
statement referred to in this SECTION 3, the Holders initiating the Demand
Notice in SECTION 3(A) above elect to withdraw such registration statement prior
to its date of effectiveness, the Company shall promptly withdraw such
registration statement prior to its effectiveness and such withdrawing Holders
shall forfeit the foregoing demand registration rights referred to in SECTIONS
3(A) AND (B) above.
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Notwithstanding the foregoing, the demand registration rights referred to in
SECTIONS 3(A) OR (B) above shall survive a pre-effectiveness election to
withdraw as set forth in this SECTION 3(F), if either (i) such withdrawing
Holders reimburse the Company for all of its Registration Expenses in connection
with the preparation of such withdrawn registration statement or (B) the
non-demanding Holders elect to replace the withdrawing Holders (in which event
such non-demanding Holders shall have been deemed to have exercised their demand
registration right).
(g) To the extent any OCM Holders or WES&S Holders elect not to
participate in the demand registration requested by the majority of the OCM
Holders or WES&S Holders (a "NON-MAJORITY HOLDER"), such Non-Majority Holders
shall have the right to participate in the demand registration requested by the
other category of shares, subject to the foregoing provisions on Cutbacks.
(h) In addition to the restrictions on the Company set forth pursuant
to SECTION 8 hereof, the Company will not grant to any Person at any time on or
after the date hereof the right (a "PIGGYBACK RIGHT") to request the Company to
register any securities of the Company under the Securities Act by reason of the
exercise by any Holder of its rights under this SECTION 3 unless such Piggyback
Right provides that such securities shall not be registered and sold at the same
time if the managing underwriter for the respective Holders reasonably believes
that the sale of such securities would adversely affect the amount of, or price
at which, the respective shares being registered under this SECTION 3 can be
sold.
(i) The Company agrees not to effect any public or private sale or
distribution of its equity securities, including a sale pursuant to Regulation D
under the Securities Act, during the ten (10) day period prior to, and during
the one-hundred and twenty day (120) period beginning on, the closing date of an
underwritten offering made pursuant to a registration statement pursuant to this
SECTION 3.
(j) To the extent that any Holders electing a demand registration
determine as of the contemplated offering date not to sell their shares pursuant
to an underwritten offering and such Holders do not reimburse the Company for
Registration Expenses in the event that no Registration Statement is declared
effective, such Holders are nonetheless entitled to have their shares registered
pursuant to a "shelf registration" for the time period set forth in SECTION 3(D)
above.
(k) The Company recognizes that money damages may be inadequate to
compensate the Holders for a breach by the Company of its obligations under this
Section, and the Company agrees
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that in the event of such a breach the Holder may apply for an injunction of
specific performance or the granting of such other equitable remedies as may be
awarded by a court of competent jurisdiction in order to afford the Holder the
benefits of this SECTION 3 and that the Company shall not object to such
application, entry of such injunction or granting of such other equitable
remedies on the grounds that money damages will be sufficient to compensate the
Holder.
SECTION 4. PIGGYBACK REGISTRATION. (a) Except for a demand
registration as set forth in Section 3 and subject to SECTIONS 5 AND 6, if at
any time the Company proposes to register any offering of shares of its capital
stock under the Securities Act, and if such registration is to be on a form of
the Commission that may include, or is at any time amended or changed to such a
form that may include the shares of the Company's capital stock (other than (i)
a registration on Form S-4 or S-8 or any successor form to such Forms, (ii) in
connection with merger, acquisitions, exchange offers or comparable
transactions, or (iii) any registration of securities as it relates to an
offering and sale to management of the Company pursuant to any employee stock
plan or other employee benefit plan arrangement), the Company will at any such
time give written notice (a "PIGGYBACK NOTICE") to all Holders of Common Stock
and any Warrantholders of its intention so to do at least thirty (30) days prior
to the filing of said registration statement.
(b) If the managing underwriter, participating in the sale and
distribution of the Company's securities covered by said registration statement
agrees that a certain number of shares of Common Stock (the "PERMISSIBLE
SECONDARY SHARES") may be included in the offering covered by the registration
statement, the Company's Piggyback Notice shall afford the Holders of Common
Stock and any Warrantholder an opportunity to elect to include in such
registration the Permissible Secondary Shares owned by them. Each Holder of
Common Stock and any Warrantholder shall have twenty (20) days after receipt of
the Company's Piggyback Notice to notify the Company in writing of the number of
shares of Common Stock (the "ELECTED SHARES") which such Holder of Common Stock
and any Warrantholder elects to include in the offering and such Elected Shares
shall be included in the offering. If the aggregate number of Elected Shares
that the Holders thereof desire to include in such filing exceeds the number of
Permissible Secondary Shares, then each Holder of Common Stock and any
Warrantholder electing to participate in such Piggyback Registration shall be
subject to a reduction in the number of shares included in such registration on
a pro-rata basis. Such managing underwriter may increase or decrease the number
of Permissible Secondary Shares at any time until all shares included in such
registration shall have been sold by such
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underwriters. For purposes of this Section 4(b) only, all shares of Common
Stock underlying any Warrant shall constitute "Elected Shares" for such
Warrantholder so long as such Warrantholder exercises such Warrant prior to the
date when the Commission declares effective any registration statement pursuant
to a Public Offering under which such shares are registered.
SECTION 5. OPINION OF COUNSEL. The Company shall have no obligation
under SECTIONS 3 AND 4 hereof to register any shares if the Company shall
deliver to the requesting Holders an opinion of counsel in form and substance
reasonably satisfactory to such Holders and their counsel to the effect that the
proposed sale or disposition of all of the shares for which registration was
requested does not require registration under the Securities Act for a sale or
disposition in a single public transaction and the resale of such shares to any
purchaser does not require registration under the Securities Act. The Company
hereby agrees to indemnify the Holders against, and to hold them harmless from,
all Losses arising from violations of law, that they may incur under the
Securities Act or otherwise by reason of them proceeding in accordance with such
opinion of counsel, other than (i) any such Losses that arise in connection with
any willful misconduct on the part of such Holders or (ii) matters for which the
Holders are obligated to indemnify the Company for under SECTION 9 hereof.
SECTION 6. REGISTRATION PROCEDURES. If and whenever the Company is
required by the provisions of this Agreement to use its best efforts to effect
the registration of any of the shares of Common Stock under the Securities Act,
the Company will (except as otherwise provided in this Agreement), as
expeditiously as possible:
(a) cooperate with any underwriters for, and the sellers of, such
shares, and will enter into a usual and customary underwriting and
confidentiality agreements with respect thereto and take all such other
reasonable actions as are necessary or advisable to permit, expedite and
facilitate the disposition of such shares in the manner contemplated by the
related registration statement in each case to the same extent as if all the
securities then being offered were for the account of the Company and the
Company will provide to any Holder, any underwriter participating in any
distribution thereof pursuant to a registration statement, and any attorney,
accountant or other agent retained by any Holder or underwriter, reasonable
access to appropriate Company officers and employees to answer questions and to
supply information reasonably requested by any such Holder, underwriter,
attorney, accountant or agent in connection with such registration statement, so
long as such person shall
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have executed a confidentiality agreement in form reasonably satisfactory to the
Company;
(b) furnish or cause to be furnished to each Holder, addressed to
such Holder, a copy of the opinion of counsel for the Company, and a copy of the
"comfort" letter signed by the independent public accountants who have certified
the Company's financial statements included in the registration statement,
delivered on the closing date to the underwriters of such shares;
(c) prepare and file with the Commission a registration statement
with respect to such securities and use its best efforts to cause such
registration statement to become and remain effective; and prepare and file with
the Commission such amendments and supplements to such registration statement
and the prospectus used in connection therewith as may be necessary to keep such
registration statement effective for the time period required pursuant to this
Agreement and to comply with the provisions of the Securities Act with respect
to the sale or other disposition of all securities covered by such registration
statement whenever the Holders shall desire to sell or otherwise dispose of the
same; PROVIDED that no such registration statement will be filed by the Company
until counsel for the Holders shall have had a reasonable opportunity to review
the same and to exercise their rights under clause (a) above with respect
thereto and no amendment to any such registration statement naming such Holders
as selling shareholders shall be filed with the Commission until such Holders
shall have had at least seven days to review such registration statement as
originally filed and theretofore amended, to exercise their rights under clause
(a) above and to approve or disapprove any portion of such registration
statement describing or referring to such Holders;
(d) furnish to each Holder such numbers of copies of a prospectus,
including a preliminary prospectus, in conformity with the requirements of the
Securities Act, and such other documents (excluding marketing and other selling
related materials), as such Holder may reasonably request in order to facilitate
the public sale or other disposition of the securities owned by such Holder;
(e) use its best efforts to register or qualify the securities covered
by such registration statement under such other securities or blue sky laws of
such jurisdictions as each Holder shall request, except that the Company shall
not for any such purpose be required to qualify to do business as a foreign
corporation in any jurisdiction wherein it is not so qualified or to file
therein any general consent to service;
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(f) in the event of the issuance of any stop order suspending the
effectiveness of any registration statement or of any order suspending or
preventing the use of any prospectus or suspending the qualification of any
shares for sale in any jurisdiction, use its best efforts promptly to obtain its
withdrawal;
(g) otherwise use its best efforts to comply with all applicable rules
and regulations of the Commission, and make available to its security holders,
as soon as reasonably practicable, an earnings statement covering the period of
at least twelve months, beginning with the first fiscal quarter beginning after
the effective date of the registration statement, which earnings statement shall
satisfy the provisions of Section 11(a) of the Securities Act; and
(h) list such securities on any securities exchange on which any stock
of the Company is then listed, if the listing of such securities is then
permitted under the rules of such exchange;
PROVIDED, HOWEVER, that notwithstanding any other provision of this Agreement,
the Company shall not be required to maintain the effectiveness of any
registration statement for a period in excess of two years (plus any period
during which the effectiveness of such registration has been suspended), except
that from time to time after a transfer of shares pursuant to a registration
statement the Company will file all reports required to be filed by it under the
Securities Act and the Exchange Act, and will take such further action as any
Holder may reasonably request, all to the extent required to enable the Holder
to sell shares pursuant to Rule 144 promulgated under the Securities Act (or any
successor thereto). Upon written request, the Company will promptly deliver to
any Holder a written statement as to whether it has complied with such
requirements at any time after it has become subject to such requirements.
SECTION 7. REGISTRATION EXPENSES.
(a) All expenses incident to the Company's performance of its
obligations in connection with any registration of a Holder's shares under this
Agreement including, without limitation, printing expenses, fees and
disbursements of counsel for the Company, fees of the National Association of
Securities Dealers, Inc. in connection with its review of any offering
contemplated in any registration statement and expenses of any special audits
which shall be necessary to comply with governmental requirements in connection
with any such registration shall be paid by the Company. In connection with
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each registration the Company shall pay (i) all registration and filing fees for
the Holders' shares under Federal and state securities laws, (ii) expenses of
complying with the securities or blue sky laws of any jurisdictions pursuant to
SECTION 6(E) hereof, and (iii) reasonable fees and expenses of no more than one
counsel for the Holders (collectively, the "REGISTRATION EXPENSES"). The
underwriting discount paid to the underwriters in connection with any
registration shall be paid by the Company, the Holders and any other selling
securities holders pro rata based on the number of shares of Common Stock sold
by the Company, the Holders and such other securities holders; PROVIDED,
HOWEVER, that the Company shall have no obligation to pay any other fees to, or
reimburse expenses of, the underwriters hereunder.
(b) It shall be a condition precedent to the obligation of the
Company to take any action pursuant to this Agreement in respect of the shares
which are to be registered at the request of any Holder that such Holder shall
furnish to the Company such information regarding the securities held by such
Holder and the intended method of disposition thereof as the Company shall
reasonably request and as shall be required in connection with the action to be
taken by the Company.
(c) The Company agrees that it will not file a registration statement
under the Securities Act, either for securities held by any of the Company's
securityholders, other than the Holders, or for securities newly issued by the
Company, until thirty (30) days after the effective date of any registration
statement filed pursuant to the request of Holders made under SECTION 3 hereof.
SECTION 8. GRANT OF REGISTRATION RIGHTS TO OTHER STOCKHOLDER. If
registration rights are granted to any holder of shares of any class of capital
stock of the Company, other than a Holder ("ADDITIONAL REGISTRATION RIGHTS"),
then the Company shall promptly notify the Holders upon the grant of such
registration rights and offer to the Holders such additional registration rights
granted to such other holders so that the terms and conditions of all
registration rights granted to the Holders by this Agreement and any subsequent
agreement are at least as favorable as the registration rights granted to such
other holders in all terms and conditions, including without limitation, the
number of demand registrations, the number of piggyback registrations, the
number of registrable shares reduced in any registration at the request of the
underwriters, reimbursement of registration expenses, indemnities and any other
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term or condition of such Additional Registration Rights. Upon receipt of such
notice and offer, the Holders shall have thirty (30) days to provide notice to
the Company that any such Holder accepts such additional registration rights.
If any such other holder exercises any Additional Registration Rights during
such thirty (30) day period, the Holders shall have the right within such thirty
(30) day period to accept the offer, and to provide notice of the Holder's
intent to join in any such registration, subject to the terms and conditions of
the Additional Registration Rights and this Agreement, as applicable.
SECTION 9. INDEMNIFICATION.
(a) In the event of any registration of any of its securities under
the Securities Act pursuant to this Agreement, to the extent permitted by law,
the Company shall indemnify and hold harmless the Holders, such Holders'
directors, officers, employees and agents, and each other person, if any, who
controls any such Holder within the meaning of the Securities Act (a
"CONTROLLING PERSON"), against any Losses, joint or several, to which such
Holder or any such director or officer or Controlling Person may become subject
under the Securities Act or any other statute or at common law, insofar as such
Losses (or actions in respect thereof) arise out of or are based upon (i) any
alleged untrue statement of any material fact contained, on the effective date
thereof, in any registration statement under which such securities were
registered under the Securities Act, or in any preliminary prospectus or final
prospectus contained therein, or any amendment or supplement thereto, or (ii)
any alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, and shall
reimburse each such Holder or such director, officer, employee, agent or
Controlling Person for any legal or any other expenses reasonably incurred by
such Holder or such director, officer, employee, agent or Controlling Person in
connection with investigating or defending any Loss; PROVIDED, HOWEVER, that the
Company shall not be liable in any such case to the extent that any such Loss
arises out of or is based upon any alleged untrue statement or alleged omission
made in such registration statement, preliminary prospectus, prospectus, or
amendment or supplement in reliance upon and in conformity with written
information furnished to the Company through an instrument duly executed by such
Holder specifically for use therein. Such indemnity shall remain in full force
and effect regardless of any investigation made by or on behalf of the Holders
or such director, officer, employee, agent or Controlling Person, and shall
survive the transfer of shares by such Holder.
(b) To the extent permitted by law, each Holder of any shares shall,
by acceptance thereof, indemnify and hold harmless
-14-
the Company, its directors, officers, employees and agents and each other
person, if any, who controls the Company against any Losses, joint or several,
to which the Company or any such director, officer, employee, agent or any such
person may become subject under the Securities Act or any other statute or at
common law, insofar as such Losses (or actions in respect thereof) arise out of
or are based upon (i) any untrue statement or omission of any material fact
contained, on the effective date thereof, in any registration statement under
which such securities were registered under the Securities Act, or in any
preliminary prospectus or final prospectus contained therein, or any amendment
or supplement thereto, or (ii) any 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 omission was contained in written information furnished to the
Company through an instrument duly executed by such Holder specifically for use
therein, and shall reimburse the Company or such director, officer, employee,
agent or other person for any legal or any other expenses reasonably incurred in
connection with investigating or defending any such Loss.
(c) Indemnification similar to that specified in SECTIONS 9(A) AND
9(B) hereof shall be given by the Company and each Holder of shares included in
a registration statement (with such modifications as shall be appropriate) to
any underwriter with respect to any required registration or other qualification
of such shares under any federal or state law or regulation of governmental
authority. The indemnity and expense reimbursement obligations of the Company
and the Holders under SECTIONS 9(A) AND 9(B) hereof shall be in addition to any
liability the Company and the Holders may otherwise have.
(d) If any action or proceeding (including any governmental
investigation or inquiry) shall be brought or any claim shall be asserted
against any person entitled to indemnity hereunder (an "INDEMNIFIED PARTY"),
such Indemnified Party shall promptly notify the party from which such indemnity
is sought (the "INDEMNIFYING PARTY") in writing, and the Indemnifying Party
shall assume the defense thereof, including the employment of counsel reasonably
satisfactory to the Indemnified Party and the payment of all reasonable fees and
expenses incurred in connection with the defense thereof. Any such fees and
expenses borne by the Indemnified Party (including any reasonable fees and
expenses incurred in connection with investigating or preparing to defend such
action or proceeding) shall be paid to the Indemnified Party, as incurred,
within fifteen days of written notice thereof to the Indemnifying Party
(regardless of whether it is ultimately determined that an Indemnified Party is
not entitled to indemnification hereunder), PROVIDED, that such Indemnified
Party shall first undertake to reimburse all such
-15-
fees and expenses to the extent it is judicially determined that such
Indemnified Party is not entitled to indemnification hereunder. Any such
Indemnified Party shall have the right to employ separate counsel in any such
action, claim or proceeding and to participate in the defense thereof, but the
fees and expenses of such counsel shall be the expenses of such Indemnified
Party unless (i) the Indemnifying Party has agreed to pay such fees and expenses
or (ii) the Indemnifying Party shall have failed to promptly assume the defense
of such action, claim or proceeding or (iii) the named parties to any such
action, claim or proceeding (including any impleaded parties) include both such
Indemnified Party and the Indemnifying Party, and such Indemnified Party shall
have been advised by counsel that there may be one or more legal defenses
available to it which are different from or in addition to those available to
the Indemnifying Party and that the assertion of such defenses would create a
conflict of interest such that counsel employed by the Indemnifying Party could
not faithfully represent the Indemnified Party (in which case, if such
Indemnified Party notifies the Indemnifying Party in writing that it elects to
employ separate counsel at the expense of the Indemnifying Party, the
Indemnifying Party shall not have the right to assume the defense of such
action, claim or proceeding on behalf of such Indemnified Party, it being
understood, however, that the Indemnifying Party shall not, in connection with
any one such action, claim or proceeding or separate but substantially similar
or related actions, claims or proceedings in the same jurisdiction arising out
of the same general allegations or circumstances, be liable for the reasonable
fees and expenses of more than one separate firm of attorneys (together with
appropriate local counsel) at any time for all such indemnified parties, unless
in the reasonable judgment of such Indemnified Party a conflict of interest may
exist between such Indemnified Party and any other of such indemnified parties
with respect to such action, claim or proceeding, in which event the
Indemnifying Party shall be obligated to pay the fees and expenses of such
additional counsel or counsels). The Indemnifying Party shall not be liable for
any settlement of any such action or proceeding effected without its written
consent, which consent shall not be unreasonably withheld.
(e) If the indemnification provided for in this SECTION 9 is
unavailable to an Indemnified Party (other than by reason of exceptions provided
in those Sections) in respect of any Losses, then each applicable Indemnifying
Party in lieu of indemnifying such Indemnified Party shall contribute to the
amount paid or payable by such Indemnified Party as a result of such Losses, in
such proportion as is appropriate to reflect the relative fault of the
Indemnifying Party and indemnified parties in connection with the actions,
statements or omissions which resulted in such Losses as well as any other
relevant equitable
-16-
considerations. The relative fault of such Indemnifying Party and the
Indemnified Party shall be determined by reference to, among other things,
whether any action in question, including any untrue statement or alleged untrue
statement of a material fact or omission or alleged omission of a material fact,
has been taken or made by, or relates to information supplied by, such
Indemnifying Party or Indemnified Party, and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
action, statement or omission. The amount paid or payable by a party as a
result of any Losses shall be deemed to include, subject to the limitations set
forth in this paragraph any legal or other fees or expenses reasonably incurred
by such party in connection with any action, suit, claim, investigation or
proceeding. The parties hereto agree that it would not be just and equitable if
contribution pursuant to this paragraph were determined by pro rata allocation
or by any other method of allocation which does not take into account the
equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section, if a Holder is an Indemnifying
Party it shall not be required to contribute any amount in excess of the net
proceeds (after giving effect to the payment of underwriter's discounts and
other fees or expenses, if any) received by the Holder in connection with such
public offering. 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.
SECTION 10. ASSIGNMENT OF REGISTRATION RIGHTS. The rights to cause
the Company to register shares pursuant to this Agreement may be assigned (but
only with all related obligations) by a Holder to a transferee or assignee of
such securities who, after such assignment or transfer, holds at least 10,000
shares (subject to appropriate adjustment for stock splits, stock dividends,
combinations and other recapitalization), provided: (a) the Company is, within a
reasonable time after such transfer, furnished with written notice of the name
and address of such transferee or assignee and the securities with respect to
which such registration rights are being assigned; (b) such transferee or
assignee agrees in writing to be bound by and subject to the terms and
conditions of this Agreement, including without limitation the provisions of
SECTION 11 below; and (c) such assignment shall be effective only if immediately
following such transfer the further disposition of such securities by the
transferee or assignee is restricted under the Securities Act. For the purposes
of determining the number of shares held by a transferee or assignee, the
holdings of transferees and assignees of a partnership who are partners or
retired partners of such partnership (including spouses and ancestors, lineal
descendants and siblings of such partners or spouses who acquire shares by
-17-
gift, will or intestate succession) shall be aggregated together and with the
partnership. Notwithstanding the foregoing, each of TCW and OCM may assign its
rights hereunder at any time in connection with a liquidating distribution of
assets to its partners. For purposes of this Agreement, any transferee or
assignee of securities pursuant to this Section 10 shall be deemed to be the
same category of Holder (I.E., OCM Holder, WES&S Holder or a Holder that is not
an OCM Holder or a WES&S Holder, as the case may be) as the transferor or
assignor of such securities.
SECTION 11. "MARKET STAND-OFF" AGREEMENT. Each Holder hereby agrees
that, during the period of duration specified by the Company and a managing
underwriter of Common Stock or other securities of the Company, following the
effective date of a registration statement of the Company filed under the
Securities Act, it shall not, to the extent requested by the Company and such
underwriter, directly or indirectly sell, offer to sell, contract to sell
(including, without limitation, any short sale), grant any option to purchase or
otherwise transfer or dispose of (other than to donees who agree to be similarly
bound) any securities of the Company held by it at any time during such period
except Common Stock included in such registration; PROVIDED, HOWEVER, that:
(a) such agreement shall be applicable only to registration
statements of the Company that cover Common Stock to be sold on its behalf, or
on behalf of Holders pursuant to demand registration rights hereunder, to the
public in an underwritten offering; and
(b) such market stand-off time period shall not exceed 120 days.
In order to enforce the foregoing covenant, the Company may impose
stop-transfer instructions with respect to the shares (and the shares or
securities of every other person subject to the foregoing restriction) until the
end of such period.
Notwithstanding the foregoing, the obligations described in this
Section shall not apply to (i) transfers by OCM Holders in connection with a
private placement pursuant to exemptions from the registration requirements of
the Securities Act provided by Section 4(2) thereof and Regulation D thereunder,
(ii) transfers by OCM or TCW to an OCM Affiliate or a TCW Affiliate,
respectively, in connection with an in-kind distribution or (iii) transfers by
WES&S Holders so long as such transfer does not constitute a Sell-Down Event.
-18-
SECTION 12. MISCELLANEOUS.
(a) NOTICES. All notices, requests and other communications
hereunder must be in writing and will be deemed to have been duly given only if
delivered personally or by facsimile transmission or mailed (first class postage
prepaid) to the parties at the following addresses or facsimile numbers:
(i) if to the Company, at
330 S. Mannheim Road, Ste. 200
Hillside, IL 60612
Facsimile No.: (708) 547-4524
Attention: Roger E. Payton
with copies to:
Latham & Watkins
633 West Fifth Street
Suite 4000
Los Angeles, CA 90071-2007
Facsimile No.: (213) 891-6763
Attention: Paul D. Tosetti
Milbank, Tweed, Hadley & McCloy
601 S. Figueroa St.
Suite 3100
Los Angeles, CA 90017
Facsimile No.: (213) 629-5063
Attention: Eric H. Schunk
(i) if to any other person who is the registered holder of any
Securities to the address for the purpose of such holder as it appears in
the stock ledger of the Company
All such notices, requests and other communications will (i) if delivered
personally to the address as provided in this Section, be deemed given upon
delivery, (ii) if delivered by facsimile transmission to the facsimile number as
provided in this Section, be deemed given upon receipt, and (iii) if delivered
by mail in the manner described above to the address as provided in this
Section, be deemed given upon receipt (in each case regardless of whether such
notice, request or other communication is received by any other Person to whom a
copy of such notice, request or other communication is to be delivered pursuant
to this Section). Any party from time to time may change its address, facsimile
number or other information for the purpose of notices to that party by giving
notice specifying such change to the other party hereto.
-19-
(b) AMENDMENT. No change in or modification of this Agreement shall
be valid unless the same shall be in writing and signed by the Company and the
Holders.
(c) ASSIGNMENT. This Agreement shall inure to the benefit of and be
binding upon the successors and permitted assigns of the Holders. This
Agreement may not be assigned by the Company without the prior written consent
of the Holders.
(d) WAIVER. No failure or delay on the part of the parties or any of
them in exercising any right, power or privilege hereunder, nor any course of
dealing between the parties or any of them shall operate as a waiver of any such
right, power or privilege nor shall any single or partial exercise of any such
right, power or privilege preclude the simultaneous or later exercise of any
other right, power or privilege. The rights and remedies herein expressly
provided are cumulative and are not exclusive of any rights or remedies which
the parties or any of them would otherwise have. No notice to or demand on the
Company in any case shall entitle the Company to any other or further notice or
demand in similar or other circumstances or constitute a waiver of the rights of
the other parties or any of them to take any other or further action in any
circumstances without notice or demand.
(e) COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.
(f) GOVERNING LAW. This Agreement shall be governed by, and
construed and enforced in accordance with, the laws of the State of California.
(g) FILING. A copy of this Agreement and of all amendments hereto
shall be filed at the principal office of the Company.
(h) TERMINATION. This Agreement may be terminated at any time by an
instrument in writing signed by the Company and each Holder.
(i) BENEFIT AND BINDING EFFECT. This Agreement shall be binding upon
and inure to the benefit of the parties and their executors, administrators,
personal representatives, heirs, successors and assigns.
(j) SEVERABILITY. In the event that any part of this Agreement
shall be held to be invalid or unenforceable, the remaining parts hereof shall
nevertheless continue to be valid
-20-
and enforceable as though the invalid portions were not a part hereof.
(k) HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
(l) ATTORNEYS' FEES. In any action or proceeding brought to enforce
any provision of this Agreement, or where any provision hereof is validly
asserted as a defense, the successful party shall be entitled to recover
reasonable attorneys' fees (including any fees incurred in any appeal) in
addition to its costs and expenses and any other available remedy.
(m) EQUITABLE RELIEF. The parties hereto agree and declare that
legal remedies may be inadequate to enforce the provisions of this Agreement and
that equitable relief, including specific performance and injunctive relief, may
be used to enforce such provisions.
-21-
IN WITNESS WHEREOF, the parties hereto have executed this Amended and
Restated Registration Rights Agreement as of the day and year first above
written.
The Company: INTERNATIONAL LOGISTICS LIMITED
By: /s/ ROGER E. PAYTON
-----------------------------
Roger E. Payton
President and
Chief Executive Officer
Holders: TCW SPECIAL CREDITS FUND V - THE
PRINCIPAL FUND
By: TCW ASSET MANAGEMENT COMPANY,
its General Partner
By: /s/ STEPHAN A. KAPLAN
-----------------------------
Stephen A. Kaplan
Authorized Signatory
By: /s/ VINCENT J. CEBULA
-----------------------------
Vincent J. Cebula
Authorized Signatory
OCM PRINCIPAL OPPORTUNITIES FUND, L.P.
By: OAKTREE CAPITAL MANAGEMENT, LLC,
its General Partner
By: /s/ STEPHAN A. KAPLAN
-----------------------------
Stephen A. Kaplan
Principal
By: /s/ VINCENT J. CEBULA
-----------------------------
Vincent J. Cebula
Senior Vice President
LOGISTICAL SIMON, L.L.C.
By: WESINVEST, Inc.
its Manager
By: /s/ MICHAEL B. LENARD
-----------------------------
Michael B. Lenard
President
[signature page continues]
INTERNATIONALE NEDERLANDEN (U.S.)
CAPITAL CORPORATION
By: /s/
-----------------------------
Name:
Title:
BANQUE PARIBAS
By: /s/ STEVEN M. HEINEN
-----------------------------
Name: Steven M. Heinen
Title: Vice President
/s/ ROGER E. PAYTON
----------------------------------
Roger E. Payton, as an individual
/s/ ANDREW ESTOCLET
----------------------------------
Andrew Estoclet, as an individual
/s/ GARY HOLTER
----------------------------------
Gary Holter, as an individual
/s/ LARRY MARZULLO
----------------------------------
Larry Marzullo, as an individual
/s/ WILLIAM E. MYERS, JR.
----------------------------------
William E. Myers, Jr., as an individual
/s/ KURT KAMM
----------------------------------
Kurt Kamm, as an individual
/s/ WILLIAM KIDD
----------------------------------
William Kidd, as an individual
/s/ DAVID W.M. HARVEY
----------------------------------
David W.M. Harvey, as an individual
/s/ BRIAN E. SANDERSON
----------------------------------
Brian E. Sanderson, as an individual
[signature page continues]
/s/ EDWARD R. MANDELL
----------------------------------
Edward R. Mandell, as an individual
/s/ AUDREY M. JAKEL
----------------------------------
Audrey M. Jakel, as an individual
/s/ KENNETH S. OGDEN
----------------------------------
Kenneth S. Ogden, as an individual
/s/ JAMES L. MAZZUCA
----------------------------------
James L. Mazzuca, as an individual
/s/ MARK LUNDGREN
----------------------------------
Mark Lundgren, as an individual
/s/ CHRISTER G. CARLSSON
----------------------------------
Christer G. Carlsson, as an individual
----------------------------------
Susan M. Cauldwell, as an individual
/s/ PAUL STONE
----------------------------------
Paul Stone, as an individual
/s/ CHRISTINE STONE
----------------------------------
Christine Stone, as an individual
/s/ DOUGLAS CRUIKSHANK
----------------------------------
Douglas Cruikshank, as an individual
/s/ RONALD S. CRUSE
----------------------------------
Ronald S. Cruse, as an individual
/s/ STEVE HITCHCOCK
----------------------------------
Steve Hitchcock, as an individual
/s/ PAUL D. SMITH
----------------------------------
Paul D. Smith, as an individual
/s/ ABE RANISH
----------------------------------
Abe Ranish, as an individual
PARIBAS NORTH AMERICA, INC.
By: /s/ JOHN MARTINEZ
-----------------------------
Name: John Martinez
Title: Financial Controller
-25-
EXHIBIT "A"
HOLDERS COMMON STOCK WARRANTS
TCW SPECIAL CREDITS FUND V -
THE PRINCIPAL FUND 695,575 0
OCM PRINCIPAL OPPORTUNITIES
FUND, L.P. 600,000 0
LOGISTICAL SIMON, L.L.C. 469,532 125,000
ROGER E. PAYTON 22,500* 175,000
ANDREW ESTOCLET 23,060 0
GARY HOLTER 5,000 0
LARRY MARZULLO 17,500 0
ING 7,500 5,025
BANQUE PARIBAS 17,500 5,025
PARIBAS NORTH AMERICA, INC. 50,000 0
WILLIAM E. MYERS, JR. 0 59,938**
BRIAN E. SANDERSON 0 14,983**
KURT KAMM 0 6,516
WILLIAM KIDD 0 6,516
EDWARD R. MANDELL 0 266
DAVID W.M. HARVEY 0 5,620**
AUDREY M. JAKEL 2,500 0
KENNETH S. OGDEN 1,000 0
JAMES L. MAZZUCA 2,500 0
MARK LUNDGREN 500 0
PAUL STONE AND
CHRISTINE STONE 500 0
CHRISTER G. CARLSSON AND
SUSAN M. CAULDWELL 1,500 0
DOUGLAS CRUIKSHANK 24,000 0
RONALD S. CRUSE 24,000 0
STEVE HITCHCOCK 24,000 0
[Table continued on next page]
-26-
PAUL D. SMITH 24,000 0
ABE RANISH 4,000 0
TOTAL 2,016,667 403,889
Common Stock Warrants
*Includes 10,000 shares issued to the Bekins Company Non-Qualified Plan dated
which shares are allocated for the benefit of Roger E. Payton.
**Includes 20,354, 5,087 and 1,909 additional Warrants issued to William E.
Myers, Jr., Brian E. Sanderson and David W.M. Harvey, respectively, with an
initial exercise price of $30.00 per share which represents on a fully-diluted
basis 2.5% of the 1,016,667 shares of Common Stock and 50,000 Warrants issued to
OCM, TCW, WES&S, Banque Paribas and Roger E. Payton on 10/31/96 and 11/7/96,
respectively.
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