EXHIBIT 10.1
FOURTH AMENDED AND RESTATED STOCKHOLDERS AGREEMENT
This FOURTH AMENDED AND RESTATED STOCKHOLDERS AGREEMENT (this
"AGREEMENT") is made and entered into as of July 10, 1998, by and between
GeoLogistics Corporation, a Delaware corporation (the "COMPANY"), and each of
the Holders listed on EXHIBIT A hereto (singularly a "HOLDER" and
collectively, the "HOLDERS").
W I T N E S S E T H
WHEREAS, each of the Holders have either purchased shares of the
Common Stock or Preferred Stock (each as defined herein) of the Company or
were granted Warrants (as defined herein) to purchase shares of the Common
Stock of the Company; and
WHEREAS, the Company and the Holders deem it to be in their best
interests to provide for continuity in the control and operation of the
Company to regulate certain of their rights in connection with their
interests in the Company and to restrict the sale, assignment, transfer,
encumbrance or other disposition of the Securities (as defined herein) to be
issued to the Holders as contemplated hereby, and desire to enter into this
Agreement in order to effectuate those purposes;
NOW, THEREFORE, in consideration of the agreements and mutual
covenants set forth herein, the parties agree as follows:
SECTION 1. DEFINITIONS. As used in this Agreement, the following
terms have the following meanings:
"ACCREDITED INVESTOR" shall have the meaning set forth for such
term in Regulation D under the Securities Act.
"ACCREDITED OFFEREE" shall have the meaning set forth in SECTION 5(a).
"ACQUIROR" has the meaning assigned to such term in SECTIONS 6(b)
AND 7.
"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" means this Agreement, as the same shall be amended from
time to time.
"BANKS" mean, collectively, ING and Paribas.
"BOARD OF DIRECTORS" means the Board of Directors of the Company.
"BUSINESS DAY" means a day other than Saturday, Sunday or any other
day on which banks located in the State of Colorado are authorized or
obligated to close.
"CLOSING DATE" means November 7, 1996.
"COMMON STOCK" means the Company's Common Stock, $0.001 par value
per share.
"COMPANY" has the meaning assigned to such term in the preamble.
"COMPANY ACCEPTANCE NOTICE" has the meaning assigned to such term
in SECTION 4(d).
"COMPANY TRANSFEREE" has the meaning assigned to such term in
SECTION 5(a).
"COMPANY TRANSFER NOTICE" has the meaning assigned to such term in
SECTION 5(a).
"COMPANY TRANSFER SECURITIES" has the meaning assigned to such term
in SECTION 5(a).
"EMPLOYEE STOCK PURCHASE PLAN" means the employee stock purchase
plans adopted by the Board of Directors on May 1, 1996 and March 3, 1997.
"EXECUTIVE COMMITTEE" shall have the meaning ascribed to such term
in SECTION 9(b).
"FAIR MARKET VALUE" shall mean the fair market value of the
Company's Common Stock as determined by the Executive Committee on a
fully-distributed basis without regard to liquidity or size relative to the
number of shares outstanding; PROVIDED that such valuation shall ascribe
value to Warrants as
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the amount, if any, by which the value of the Common Stock underlying the
warrant shall exceed the aggregate exercise price related thereto.
"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.
"FINANCIAL DEFAULT" shall mean with respect to the Company or any
Subsidiary, any of the following: (i) the occurrence of a default under any
indebtedness with a principal amount in excess of $20 million (either
individually or in the aggregate) to the extent that such default is not
cured or waived within thirty (30) days; (ii) the acceleration of any
indebtedness with a principal amount in excess of $10 million (either
individually or in the aggregate) to the extent not paid or rescinded within
five (5) days; (iii) the imposition of any final and non-appealable judgments
in excess of $10 million (either individually or in the aggregate) to the
extent not paid or rescinded within five (5) days; or (iv) the filing of any
voluntary or involuntary bankruptcy petition with respect to the Company or
any Subsidiary to the extent not withdrawn within five (5) days.
"FINANCIAL DEFAULT DISAGREEMENT" shall mean that, upon the
occurrence of a Financial Default, the Board of Directors is unable to agree
on the Company's course of action in response to a Financial Default.
"HOLDERS" has the meaning assigned to such term in the preamble.
"ING" means ING Capital (U.S.) Corporation.
"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).
"INTER VIVOS TRANSFEREE" has the meaning assigned to such term in
SECTION 3(d).
"MANAGEMENT" means each Person set forth on EXHIBIT B attached
hereto, as the same may be amended from time to time.
"MYERS" means 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 rea-
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sonably 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.
"OCM" means OCM Principal Opportunities Fund, L.P., a Delaware
limited partnership.
"OCM AFFILIATES" means any investor in or any employee of OCM 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 OCM or Oaktree, is a shareholder, manager
or general partner, as the case may be.
"OCM ENTITY" means either or both of TCW and OCM, as the context
indicates.
"OCM ENTITY ACCEPTANCE NOTICE" has the meaning assigned to such
term in SECTION 4(c).
"OCM ENTITY FUNDING DEFAULT" means a circumstance whereby (i) an
OCM Entity and WES&S have entered into a commitment to purchase Securities of
the Company pursuant to a purchase agreement; (ii) such OCM Entity is in
breach of its commitment to purchase such Securities; and (iii) WES&S
ultimately completes its purchase under such purchase agreement.
"OCM ENTITY OFFER" has the meaning assigned to such term in SECTION
4(b).
"OCM ENTITY PURCHASE DEFAULT" means an OCM Entity is in breach of
its purchase obligation under an OCM Entity Acceptance Notice in connection
with certain transfers of the WES&S Shares as set forth in SECTION 4.
"OCM ENTITY SHARES" means all the Securities now and hereafter held
by OCM, any OCM Affiliate, TCW or any TCW Affiliate.
"OCM ENTITY TRANSFER TERMINATION EVENT" means the first to occur
of (i) a Qualified Public Offering, (ii) a Sell-Down Event, (iii) a WES&S
Purchase Default, (iv) a WES&S Funding Default or (v) May 2, 2002.
"OCM TRANSFER SECURITIES" has the meaning assigned to such term in
SECTION (3)(a).
"OFFER TO SELL" has the meaning assigned to such term in SECTION
5(b).
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"OFFEREE" means, for the purposes of SECTION 4 hereof: (i) with
respect to any proposed Transfer by an OCM Entity: WES&S; (ii) with respect
to any proposed Transfer by WES&S: each OCM Entity; and (iii) with respect
to any proposed Transfer by each of Management, Myers or the Banks: the
Company, each OCM Entity and WES&S, as applicable.
"PARIBAS" means Banque Paribas and Paribas North America, Inc.
"PERMITTED TRANSFER" has the meaning assigned to such term in
SECTION 3.
"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.
"PREFERRED STOCK" shall mean the Company's Series A Participating
Preferred Stock, par value $.001 per share.
"PRO RATA" shall mean, with respect to any offer of shares of
Common Stock or securities exercisable or convertible into shares of Common
Stock, an offer based on the relative percentages of Securities then held by
or issuable to all of the Holders to whom such offer is made.
"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 under
the Securities Act.
"PUBLIC TRANSFEREES" has the meaning assigned to such term in
SECTION 2(c).
"QUALIFIED PUBLIC OFFERING" means a Public Offering wherein the
aggregate offering proceeds are not less than $30,000,000 (determined based
on gross offering price paid to the Company at the closing of each such
transaction for the offered securities).
"QUALIFIED SALE" shall mean (i) any sale of all or substantially
all of the assets of the Company or (ii) any sale, merger or liquidation of
the Company with or into any entity other than to or with OCM, TCW, WES&S, an
OCM Affiliate, a TCW Affiliate or a WES&S Affiliate whereby such entity or
the holders of a majority of the voting stock thereof shall obtain (A) at
least a majority of the voting stock of the surviving entity and (B) the
right to elect a majority of the surviving entity's board of directors.
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"RE-OFFER ACCEPTANCE NOTICE" has the meaning assigned to such term
in SECTION 4(d).
"RE-OFFER NOTICE" has the meaning assigned to such term in SECTION
4(d).
"REFUSAL NOTICE" has the meaning assigned to such term in SECTION
4(a).
"REFUSAL SECURITIES" has the meaning assigned to such term in
SECTION 4(a).
"REFUSAL TRANSFEREE" has the meaning assigned to such term in
SECTION 4(a).
"SECURITIES" shall mean the shares of Common Stock and Preferred
Stock and any securities convertible or exercisable into shares of Common
Stock or Preferred 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, and
the rules and regulations promulgated thereunder.
"SELL-DOWN EVENT" means an event, subject to SECTIONS 2, 3 AND 4,
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.
"SELLING COMMON HOLDERS" has the meaning assigned to it in SECTIONS
6(b).
"SELLING HOLDERS" has the meaning assigned to it in SECTION 7.
"SELLING PREFERRED HOLDERS" has the meaning assigned to it in
SECTIONS 6(c).
"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.
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"SUBSIDIARY" means any entity at least fifty percent (50%) owned or
controlled either directly or indirectly by the Company or any of its
Subsidiaries.
"TCW" means TCW Special Credits Fund V - The Principal Fund, a
California limited partnership,
"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 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.
"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).
"TRADING PRICE" means the trading price for each trading day: (a)
if the Common Stock is traded on a national securities exchange, its last
reported sale price on the preceding Business Day on such national securities
exchange or, if there was no sale on that day, the last reported sale price
on such national securities exchange on the next preceding Business Day on
which there was a sale, all as made available over the Consolidated Last Sale
Reporting System of the CTA Plan (the "CLSRS") or, if the Common Stock is not
then eligible for reporting over the CLSRS, its last reported sale price on
the preceding Business Day on such national securities exchange or, if there
was no sale on that day, on the next preceding Business Day on which there
was a sale on such exchange or (b) if the principal market for the Common
Stock is the over-the-counter market, but the Common Stock is not then
eligible for reporting over the CLSRS, but the Common Stock is quoted on the
National Association of Securities Dealers Automated Quotations System
("NASDAQ"), the last sale price reported on NASDAQ on the preceding Business
Day or, if the Common Stock is an issue for which last sale prices are not
reported on NASDAQ, the closing bid quotation on such day, but in each of the
next preceding two cases, if the relevant NASDAQ price or quotation did not
exist on such day, then the price or quotation on the next preceding Business
Day in which there was such a price or quotation.
"TRANSFER" has the meaning assigned to such term in SECTION 2(a).
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"TRANSFER NOTICE" has the meaning assigned to such term in SECTIONS
6(b) & 7.
"TRANSFEROR" has the meaning assigned to such term in SECTION 4(a).
"VOTING TERMINATION EVENT" has the meaning assigned to such term in
SECTION 8(a).
"WARRANT(S)" means the Warrants exercisable into the Common Stock
of the Company at either a fixed or variable priced exercise rate.
"WES&S" means Logistical Simon, L.L.C., a Delaware limited
liability company, and for purposes of Sections 4(b) and 4(d) only and only
in the event that WES&S offers to acquire an amount of Refusal Securities,
includes Myers; PROVIDED, HOWEVER, that should WES&S and Myers each offer to
acquire an amount of Refusal Securities (as defined in Section 4(a) hereof)
that is oversubscribed pursuant to such Sections 4(b) and 4(d), the shares to
be so purchased shall be allocated to each of WES&S and Myers Pro-Rata based
upon the relative number of Securities owned by each entity as of such date.
"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 shareholders, 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.
"WES&S ACCEPTANCE NOTICE" has the meaning assigned to such term in
SECTION 4(b).
"WES&S FUNDING DEFAULT" means a circumstance whereby (i) an OCM
Entity and WES&S have entered into a commitment to purchase the Securities of
the Company pursuant to a purchase agreement; (ii) WES&S is in breach of its
commitment to purchase such Securities; and (iii) an OCM Entity ultimately
completes its purchase under such purchase agreement.
"WES&S OFFER" has the meaning assigned to such term in SECTION 4(c).
"WES&S PURCHASE DEFAULT" means WES&S is in breach of its purchase
obligation under a WES&S Acceptance Notice in
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connection with certain transfers of the OCM Entity Shares as set forth in
SECTION 4.
"WES&S SHARES" means all the Securities now and hereafter held by
WES&S and any WES&S Affiliate.
"WES&S TRANSFER SECURITIES" has the meaning assigned to such term
in SECTION 3(b).
"WES&S TRANSFER TERMINATION EVENT" means the first to occur of (i)
a Qualified Public Offering, (ii) an OCM Entity Purchase Default, (iii) an
OCM Entity Funding Default, (iv) the date on which the OCM Entities, in the
aggregate, own less than fifty percent (50%) of the total number of shares
held by the OCM Entities as of the Closing Date or (v) May 2, 2002.
SECTION 2. PROVISIONS REGARDING TRANSFER.
(a) GENERAL RESTRICTIONS. So long as this Agreement shall remain
in force, none of the Securities may be issued, sold, assigned, transferred,
given away or in any way disposed of (any of the foregoing being hereinafter
referred to as a "TRANSFER") unless:
(i) the Person in whose favor such Transfer is made shall
deliver to the Company a written acknowledgment that the Securities to be
transferred are subject to this Agreement and that such Person and such
Person's successors in interest are bound hereby on the same terms as the
Transferor of such Securities, but prior to any such Transfer, the Transferor
shall give the Company (1) notice describing the manner and circumstances of
the proposed Transfer and (2) if reasonably requested by the Company, a
written opinion in form and substance reasonably satisfactory to legal
counsel of the Company to the effect that the proposed Transfer may be
effected without registration under the Securities Act or any applicable
state law;
(ii) such Transfer shall be made in compliance with the
provisions of this Agreement, the Employee Stock Purchase Plan and the
Management subscription agreements; or
(iii) such Transfer shall be made pursuant to a public
offering registered under the Securities Act and in accordance with
applicable state law or pursuant to Rule 144 under the Securities Act.
Any attempted Transfer other than in accordance with this Agreement shall be
void, and the Company shall refuse to recognize any such Transfer and shall
not reflect on its records
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any change in record ownership of the Securities pursuant to any such
attempted Transfer.
(b) MECHANICS OF TRANSFER. The closing of any Transfer of
Securities (other than pursuant to SECTION 2(a)(iii) above) shall take place
at the principal executive offices of the Company. Any Holder who Transfers
the Securities shall (i) take all such actions and execute and deliver all
such documents as may be necessary or reasonably requested by the Company in
order to consummate the Transfer of such Securities and (ii) pay to the
Company such amounts as may be required for any applicable stock transfer
taxes.
(c) PLEDGE AND HYPOTHECATION PROHIBITED. In the case of Securities
other than Preferred Stock, no Holder (other than any Persons not a party to
this Agreement who acquire such Securities pursuant to a registration
statement ("PUBLIC TRANSFEREES")) shall, prior to a Qualified Public
Offering, in any manner pledge, hypothecate or encumber, or grant options
with respect to, any such Securities held by such Holder, unless such Holder
obtains the prior (i) written approval of the Executive Committee and (ii)
written agreement of the designated assignee or secured party to acknowledge,
accept and agree to be bound by the terms of this Agreement. No Holder of
Preferred Stock (other than any Public Transferee) shall, in any manner
pledge, hypothecate or encumber, or grant options with respect to any shares
of Preferred Stock held by such Holder, unless such Holder obtains the prior
(i) written approval of the Executive Committee and (ii) written agreement of
the designated assignee or secured party to acknowledge, accept and agree to
be bound by the terms of this Agreement.
SECTION 3. TRANSFERS NOT SUBJECT TO RIGHT OF FIRST REFUSAL. The
following Transfers (each a "PERMITTED TRANSFER") shall not be subject to the
rights of first refusal set forth in SECTION 4 hereof:
(a) CERTAIN TRANSFERS BY OCM ENTITY. Subject to the restrictions
on Transfer set forth in SECTION 2, an OCM Entity or any subsequent holder of
the OCM Entity Shares other than Preferred Stock ("OCM TRANSFER SECURITIES"),
may Transfer or grant participation in any or all of the OCM Transfer
Securities to (i) any OCM Affiliate or a TCW Affiliate in connection with an
in-kind distribution, (ii) any Person pursuant to a demand or piggyback
registration or (iii) any other Person to the extent the aggregate number of
OCM Transfer Securities so transferred shall not exceed thirty percent (30%)
of the aggregate number of OCM Transfer Securities purchased by the OCM
Entities, in the aggregate, from the Company on the Closing Date and
subsequent thereto. Any OCM Transfer Securities, or interest therein, so
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transferred may subsequently be transferred back to an OCM Entity and upon
such reacquisition such OCM Transfer Securities shall be subject to this
Agreement; PROVIDED, HOWEVER, that any OCM Transfer Securities so reacquired
by an OCM Entity shall not be subject to this Agreement to the extent that an
OCM Entity purchased such OCM Transfer Securities pursuant to a registration
statement or from a Public Transferee.
(b) CERTAIN TRANSFERS BY WES&S. Subject to the restrictions on
Transfer set forth in SECTION 2, WES&S or any subsequent holder of the WES&S
Shares other than Preferred Stock ("WES&S TRANSFER SECURITIES") may Transfer
or grant participation in any or all of the WES&S Transfer Securities to (i)
any Person to the extent that such Transfer would not constitute a Sell-Down
Event or (ii) any other Person pursuant to a demand or piggyback
registration. Any WES&S Transfer Securities, or interest therein, so
transferred may subsequently be transferred back to WES&S and upon such
reacquisition such WES&S Transfer Securities shall be subject to this
Agreement; PROVIDED, HOWEVER, that any WES&S Transfer Securities so
reacquired by WES&S shall not be subject to this Agreement to the extent that
WES&S purchased such WES&S Transfer Securities pursuant to a registration
statement or from a Public Transferee.
(c) CERTAIN TRANSFERS BY MANAGEMENT, MYERS OR THE BANKS. Each of
Management, Myers, or the Banks, may Transfer any or all of their respective
shares of Common Stock to any Person in connection with a piggyback
registration. Subject to the restrictions on Transfer set forth in SECTION
2, Myers may transfer any or all of his Securities to a Myers Affiliate. Any
shares of Common Stock, or interest therein, so transferred by a Holder
pursuant to this SECTION 3(c) may subsequently be transferred back to such
Holder and upon such reacquisition such shares of Common Stock shall be
subject to this Agreement; PROVIDED, HOWEVER, that any shares of Common
Stock so reacquired by such Holder shall not be subject to this Agreement to
the extent that such Holder purchased such shares of Common Stock pursuant to
a registration statement or from a Public Transferee.
(d) INTER VIVOS TRANSFERS. Any Holder who is a natural person may
transfer, by INTER VIVOS Transfer, any or all of his or her Securities to any
other natural person who is a Family Member or to a trust primarily for the
benefit of such natural person who is a Family Member or such Holder (an
"INTER VIVOS TRANSFEREE"); PROVIDED that such Holder retains all voting
rights with respect to such Securities, and; PROVIDED, FURTHER, that no
Holder who is a natural person may make an INTER VIVOS transfer to any person
unless such Holder shall comply with the provisions of SECTION 2. Subject to
the restrictions of SECTION
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2, any Securities transferred pursuant to this SECTION 3(d) may
subsequently be transferred back to such Holder.
(e) CERTAIN TRANSFERS OF PREFERRED STOCK. Any Holder may Transfer
not less than 3,000 shares of Preferred Stock to any Person and such Transfer
shall not be subject to the provisions of Section 4 hereof.
SECTION 4. RIGHT OF FIRST REFUSAL. Each Holder agrees that, except
as provided in SECTIONS 3 AND 5 hereof, such Holder will not transfer any
Securities, or any right, title or interest therein, unless such Holder shall
have first made the offers to sell set forth in this SECTION 4.
(a) REFUSAL NOTICE. A Holder that desires in good faith to Transfer
any Securities that are subject to the provisions of Section 4(b), (c) or (d)
(the "TRANSFEROR") shall deliver a written notice of such intent (the "REFUSAL
NOTICE") to each Offeree as required pursuant to Section 4(b), (c) or (d). The
Refusal Notice shall contain (i) a description of the proposed Transfer
transaction and the terms thereof including the number and type of Securities
(E.G., Preferred Stock, Common Stock or Warrants) proposed to be transferred
(collectively, the "REFUSAL SECURITIES"), (ii) the name of each person to whom
or in favor of whom the proposed Transfer is to be made (the "REFUSAL
TRANSFEREE") and (iii) a description of the consideration to be received by the
Transferor upon Transfer of the Refusal Securities; PROVIDED, HOWEVER, that if
any Holder desires to Transfer any Securities pursuant to Rule 144 of the
Securities Act, such Holder shall not be required to satisfy subsection (a)(ii)
herein. The Refusal Notice shall be accompanied by a copy of the third party
written offer (for purposes of this SECTION 4, an executed letter of intent
stating the terms of such offer, or incorporating by reference therein a
separate summary of terms which shall be deemed a written offer). No offer
(covered by this SECTION 4) to Transfer to a Transferee shall be permissible,
unless the consideration for the Transfer involved consists solely of cash.
(b) TRANSFERS BY OCM ENTITY. Prior to an OCM Entity Transfer
Termination Event, if an OCM Entity intends in good faith to sell or otherwise
Transfer any OCM Transfer Securities to any Person, such OCM Entity shall
deliver to WES&S, concurrently with the delivery of the Refusal Notice, a
written offer to sell (the "OCM ENTITY OFFER") all, but not less than all, of
such Refusal Securities which are the subject of the Refusal Notice. Each OCM
Entity Offer shall contain the same terms and conditions, and shall be for the
same consideration, as described in the Refusal Notice. Within five (5)
Business Days
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after the Refusal Notice is delivered to WES&S, WES&S may, by written notice
delivered to such OCM Entity (a "WES&S ACCEPTANCE NOTICE"), accept the offer
to acquire all, but not less than all, of the Refusal Securities as described
in the Refusal Notice. Transfers of OCM Transfer Securities to WES&S
pursuant to offers made and accepted in accordance with this SECTION 4 shall
occur simultaneously on a Business Day not more than thirty (30) days after
the date on which the WES&S Acceptance Notice is delivered to such OCM
Entity. If WES&S breaches its obligation to purchase the Refusal Securities
which are the subject of the Refusal Notice within thirty (30) days of the
date on which the WES&S Acceptance Notice is delivered to such OCM Entity,
(i) WES&S shall forfeit (A) any and all future rights of first refusal with
respect to the OCM Transfer Securities and (B) any and all future rights of
first refusal with respect to any proposed Transfer of Securities pursuant to
SECTION 4(d) hereof, and (ii) except as provided in SECTION 4(f) hereof such
failure shall constitute a WES&S Purchase Default.
(c) TRANSFERS BY WES&S. Prior to a WES&S Transfer Termination Event,
if WES&S intends in good faith to sell or otherwise Transfer any WES&S Transfer
Securities to any Person, WES&S shall deliver to each OCM Entity, concurrently
with the delivery of the Refusal Notice, a written offer to sell (the "WES&S
OFFER") all, but not less than all, of such Refusal Securities which are the
subject of the Refusal Notice. Each WES&S Offer shall contain the same terms
and conditions, and shall be for the same consideration, as described in the
Refusal Notice. Within five (5) Business Days after the Refusal Notice is
delivered to each OCM Entity, each OCM Entity may, by written notice delivered
to WES&S (an "OCM ENTITY ACCEPTANCE NOTICE"), accept the offer to acquire all,
but not less than all, of the Refusal Securities as described in the Refusal
Notice; PROVIDED HOWEVER, that if each OCM Entity elects to submit an OCM Entity
Acceptance Notice, the WES&S Transfer Securities to be so purchased shall be
allocated to each OCM Entity on such basis as may be agreed upon by the OCM
Entities. Transfers of WES&S Transfer Securities to an OCM Entity pursuant to
offers made and accepted in accordance with this SECTION 4 shall occur
simultaneously on a Business Day not more than thirty (30) days after the date
on which the OCM Entity Acceptance Notice is delivered to WES&S. If either OCM
Entity breaches its obligation to purchase the Refusal Securities which are the
subject of the Refusal Notice within thirty (30) days of the date on which the
OCM Entity Acceptance Notice is delivered to WES&S, (i) both OCM Entities shall
forfeit (A) any and all future rights of first refusal with respect to the WES&S
Transfer Securities and (B) any and all future rights of first refusal with
respect to any proposed Transfer of Securities pursuant to SECTION 4(d) hereof,
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and (ii) except as provided in SECTION 4(f) hereof such failure shall
constitute an OCM Entity Purchase Default.
(d) TRANSFERS BY HOLDERS. Prior to a Qualified Public Offering (and
in the case of Myers, if earlier, May 2, 2002), if any Holder (other than an OCM
Entity and WES&S), subject to the transfer restrictions, if any, as set forth in
the terms of such Holder's Warrant, intends in good faith to sell or otherwise
Transfer any Securities to any Person, such Holder shall deliver to the Company,
concurrently with the delivery of the Refusal Notice, a written offer to sell
(the "COMPANY OFFER") all, but not less than all, of such Refusal Securities
which are the subject of the Refusal Notice; PROVIDED, HOWEVER that if any such
Holder intends to Transfer any Securities to the Company pursuant to the terms
of such Holder's employment or subscription agreement, such Holder shall not be
required to deliver a Refusal Notice pursuant to this subsection (d). Each
Company Offer shall contain the same terms and conditions, and shall be for the
same cash consideration, as described in the Refusal Notice. Within five (5)
Business Days after the Refusal Notice is delivered to the Company, the Company
may, by written notice delivered to such proposed Transferor (a "COMPANY
ACCEPTANCE NOTICE"), accept the offer to acquire all, but not less than all, of
the Refusal Securities as described in the Refusal Notice. If the Company does
not return the Company Acceptance Notice within the required five (5) Business
Day period, the proposed Transferor shall deliver to each OCM Entity and WES&S,
concurrently with the delivery of a Refusal Notice ("RE-OFFER NOTICE") a written
offer to sell (the "RE-OFFER") all but not less than all of such Refusal
Securities which are the subject of the Refusal Notice; PROVIDED, HOWEVER, that
the proposed Transferor shall not be obligated to deliver a Re-Offer Notice to
an OCM Entity or WES&S to the extent that their respective rights of first
refusal have expired as set forth in SECTIONS 4(b) AND (c) hereof. Within five
(5) Business Days after the Re-Offer Notice is delivered to each OCM Entity and
WES&S, each OCM Entity and WES&S may, by written notice delivered to such
proposed Transferor (a "RE-OFFER ACCEPTANCE NOTICE"), accept the offer to
acquire all, but not less than all, of the Refusal Securities as described in
the Re-Offer Notice. Each of the Company, each OCM Entity and WES&S, as
applicable, shall be required to complete the purchase of the Refusal Securities
which are the subject of the applicable acceptance notice referred to in this
SECTION 4(d) within thirty (30) days of receipt of the applicable acceptance
notice by the proposed Transferor. If more than one of WES&S and the OCM
Entities elect to submit a Re-Offer Acceptance Notice, the Securities to be so
purchased shall be allocated to each entity which has submitted a Re-Offer
Acceptance Notice Pro-Rata based upon the relative number of Preferred Stock
owned by each such entity as of such date in the event of a Re-Offer Acceptance
- 14 -
Notice relating to Preferred Stock and the relative number of Securities
other than Preferred Stock owned by each such entity as of said date in the
event of a Re-Offer Acceptance Notice relating to Securities other than
Preferred Stock.
(e) ELECTION OF TRANSFEROR. In the event that an Offeree does not
agree to purchase all of the Refusal Securities offered for sale to such Offeree
by a Transferor, such Transferor has the right at such Transferor's election to
(i) transfer the Refusal Securities to a third party in accordance with the
terms of SECTION 4(f) below.
(f) TRANSFERS TO THIRD PARTIES. If the Transfer of Refusal
Securities to an Offeree is not completed within the period set forth in
SECTIONS 4(b), (c) OR (d), as applicable, then such Transferor has the right to
complete a sale transaction with a third party; PROVIDED, that the consideration
received by such Transferor in respect of any such Transfer is not less than the
consideration proposed by the Refusal Notice. Notwithstanding any forfeiture of
future refusal rights as set forth in SECTIONS 4(b) AND (c), if such Transfer
transaction with a third party is not completed within ninety (90) days of the
date the Refusal Notice is received by each OCM Entity, WES&S or the Company, as
the case may be, then each OCM Entity, WES&S or the Company, as the case may be,
shall have the rights of first refusal with respect to any subsequent proposed
sale of Securities covered by this SECTION 4.
(g) TRANSFER OF SHARES. Transfers of Securities pursuant to offers
made and accepted in accordance with this SECTION 4 shall be made subject to and
in accordance with SECTION 2. Any Transfer made in violation of this SECTION 4
shall be void and of no force and effect.
SECTION 5. PREEMPTIVE RIGHTS. If the Company issues any Common Stock
or securities convertible into Common Stock, or any right, title or interest
therein to any Person, then the Company shall make the offer to sell pursuant
to, and otherwise comply with the requirements set forth in this SECTION 5.
Notwithstanding the foregoing, the Company may Transfer Common Stock or
securities convertible into Common Stock, and any right, title or interest
therein without making the offer to sell as set forth in this SECTION 5 in
connection with (i) a Public Offering, (ii) the issuance of shares of Common
Stock in connection with the exercise of any Warrants, (iii) the issuance by the
Company of shares of Common Stock or securities convertible into Common Stock to
effect an acquisition, merger or consolidation for consideration other than
cash; (iv) the issuance of Securities to certain employees, executive officers
and directors of the Com-
- 15 -
pany pursuant to any stock option plan or stock purchase plan approved by the
Board of Directors and (v) the issuance of Securities to any employee,
director or officer of the Company or any of its Subsidiaries.
Notwithstanding the foregoing, any rights or obligations pursuant to this
SECTION 5 shall terminate no later than the date of an Initial Public
Offering. The rights in this SECTION 5 shall not inure to the benefit of
Myers with respect to any Warrants owned by Myers or any transferee therefrom.
(a) COMPANY TRANSFER NOTICE. If the Company desires in good faith to
Transfer Common Stock or securities convertible into Common Stock, the Company
shall deliver a written notice of the proposed Transfer (the "COMPANY TRANSFER
NOTICE") to each Holder that in the reasonable judgment of the Company is an
Accredited Investor, or who can provide the Company with an opinion of counsel,
reasonably satisfactory in form and substance to the Company, that the Company
Transfer Securities (as defined below) may be sold to such Holder without
registration under the Securities Act (each an "ACCREDITED OFFEREE"). The
Company Transfer Notice shall contain a description of the proposed transaction
and the terms thereof including the number of Securities and type of Securities
proposed to be transferred (collectively, the "COMPANY TRANSFER SECURITIES"),
the name of each person to whom or in favor of whom the proposed Transfer is to
be made (the "COMPANY TRANSFEREE"), and a description of the consideration to be
received by the Company upon Transfer of the Company Transfer Securities. On a
day which is not earlier than the ten (10) days following delivery of the
Company Transfer Notice and after having received the requisite approval from
the Board of Directors, the Company may issue the Company Transfer Securities to
the Company Transferee on the terms set forth in the Company Transfer Notice.
(b) TERMS OF OFFER. Upon completion of the issuance of the Company
Transfer Securities referred to in SUBSECTION (a) above, the Company shall
deliver to each Accredited Offeree a written offer to sell (the "OFFER TO SELL")
a Pro-Rata portion of an equivalent number of the Company Transfer Securities
based upon such Holder's holdings of Securities other than Preferred Stock,
provided that the Company may, in its sole discretion, make an Offer to Sell to
all Holders if such Offer to Sell may be made in compliance with all applicable
state and federal securities laws. The Offer to Sell shall be on the same terms
and conditions, and shall be for cash. If the consideration described in the
Company Transfer Notice is for something other than cash, the purchase price
paid by each Holder for shares purchased pursuant to this SUBSECTION (b) shall
be in cash at the Trading Price (or if no trading price is available, then the
Fair
- 16 -
Market Value) of such Securities determined as of the issue date of the
Company Transfer Securities.
(c) ACCEPTANCE OF OFFER. Within thirty (30) days after receipt of an
Offer to Sell, any Accredited Offeree may, by written notice delivered to the
Company, accept the Offer to Sell in whole or in part.
(d) TRANSFER OF SHARES. Transfers of Securities pursuant to offers
made and accepted in accordance with this SECTION 5 or to a Company Transferee
shall occur simultaneously on a Business Day not more than thirty (30) days
after the last date on which any offer made in accordance with this SECTION 5
could have been accepted. Each such Transfer shall be made in accordance with
SECTIONS 2(a) AND (b) hereof.
SECTION 6. DRAG-ALONG. (a) QUALIFIED SALE. If prior to a Qualified
Public Offering, (i) the Company agrees to be sold, merged or liquidated
pursuant to a Qualified Sale and (ii) such Qualified Sale is approved by more
than eighty percent (80%) of the outstanding shares of Common Stock entitled to
vote on such transaction, then all Holders (other than Public Transferees),
shall be deemed to have consented to such Qualified Sale and shall execute such
documents to confirm such consent.
(b) COMMON STOCK SALE. If, at any time prior to the consummation of
a Qualified Public Offering, the Holders holding shares in excess of eighty
percent (80%) of the issued and outstanding Common Stock (the "SELLING COMMON
HOLDERS") elect to sell such shares of Common Stock to the Company or a third
party (other than an OCM Entity, WES&S, an OCM Affiliate, a TCW Affiliate or a
WES&S Affiliate) (an "ACQUIROR"), then the Acquiror shall have the right, at its
option, to purchase from the Holders other than the Selling Common Holders and
any Public Transferees (the "NON-SELLING COMMON HOLDERS"), the same Pro-Rata
portion of Securities (other than Preferred Stock) as is being acquired from the
Selling Common Holders at the same price per Security (other than Preferred
Stock), with the same form of consideration and upon the same terms and
conditions as set forth in the Transfer Notice (as defined below); PROVIDED,
HOWEVER, that the price paid to any warrantholder shall be the price paid by the
Acquiror for each share of Common Stock less any exercise price payable by such
warrantholder.
(b) PREFERRED STOCK SALE. If at any time the Holders holding
shares in excess of eighty percent (80%) of the issued and outstanding shares
of Preferred Stock (the "SELLING PREFERRED HOLDERS") elect to sell such
shares of Preferred Stock to an Acquiror, then the Acquiror shall have the
right, at its option,
- 17 -
to purchase from the Holders other than the Selling Preferred Holders and any
Public Transferees (the "NON-SELLING PREFERRED HOLDERS"), the same Pro-Rata
portion of Preferred Stock as is being acquired from the Selling Preferred
Holders at the same price per share of Preferred Stock, with the same form of
consideration and upon the same terms and conditions as set forth in the
Transfer Notice (as defined below).
(c) EXERCISE OF RIGHTS. To exercise this drag-along right, the
Selling Common Holders or Selling Preferred Holders shall provide written notice
(a "TRANSFER NOTICE") to each Non-Selling Common Holder or Non-Selling Preferred
Holder, respectively, ten (10) Business Days following any such Transfer of
Common Stock or Preferred Stock, respectively, explaining the terms of such
offer and identifying the name and address of the Acquiror. If the Acquiror
exercises its right to purchase a portion, but not all, of the Securities owned
by the Non-Selling Common Holders or Non-Selling Preferred Holder, as
applicable, then such Acquiror shall purchase a Pro Rata portion of the
Securities from each such Non-Selling Common Holder or Non-Selling Preferred
Holder, respectively, within twenty (20) Business Days following the sale of
Securities by the Selling Common Holder or Selling Preferred Holder, as
applicable.
SECTION 7. TAG-ALONG. Prior to a Qualified Public Offering, if
Holders (other than Public Transferees) holding shares in excess of
seventy-five percent (75%) of the issued and outstanding Common Stock (the
"SELLING HOLDERS") elect to sell, dispose of or otherwise Transfer such
shares of Common Stock to a third party (other than an OCM Entity, WES&S, an
OCM Affiliate, a TCW Affiliate or a WES&S Affiliate)(the "ACQUIROR"), then,
at least twenty (20) days prior to any such Transfer by the Selling Holders
of any Common Stock, the Selling Holders shall provide to each Holder other
than a Selling Holder and Public Transferee (a "NON-SELLING HOLDER") a
written notice (a "TRANSFER NOTICE") explaining the terms of such transfer
and identifying the name and address of the potential Acquiror. Upon receipt
of such Transfer Notice, each such Non-Selling Holder shall have the right,
upon delivery of a written request to the Selling Holders within twenty (20)
days of the date the Transfer Notice is received by such Non-Selling Holder,
to cause the potential Acquiror to purchase from such Non-Selling Holder a
Pro-Rata portion of the Securities other than Preferred Stock which are
proposed to be sold by the Selling Holders (on a fully-diluted basis) in the
Transfer Notice at the same price and on the same terms and conditions
contained in the Transfer Notice delivered in connection with such proposed
transaction; PROVIDED, HOWEVER, that the price paid to any warrantholder
shall be the price paid
- 18 -
by the Acquiror for each share of Common Stock less any exercise price
payable by such warrantholder.
SECTION 8. BOARD OF DIRECTORS. (a) PRE-VOTING TERMINATION EVENT
BOARD. Prior to the first to occur of (i) an Initial Public Offering, (ii) a
Sell-Down Event, (iii) a WES&S Purchase Default, (iv) a WES&S Funding Default,
(v) a Financial Default Disagreement, (vi) an OCM Entity Purchase Default,
(vii) an OCM Entity Funding Default or (viii) May 2, 2002 (in each case a
"VOTING TERMINATION EVENT"), the Board of Directors shall at all times consist
of eight (8) members. Each Holder of Securities hereby agrees to cause all such
Securities that are entitled to vote and are registered in the name of such
Holder to be voted, and will otherwise take or cause to be taken all such other
action as may be necessary, so that the Board of Directors of the Company shall
at all times, until a Voting Termination Event, consist of eight (8) members, of
which two (2) members shall be designated by OCM (an "OCM DIRECTOR"), one (1)
member shall be designated by TCW (a "TCW DIRECTOR"), three (3) members shall
designated by WES&S (a "WES&S DIRECTOR"), one (1) member shall be the Chief
Executive Officer of the Company and one (1) member shall be William E. Myers,
Jr.
(b) POST-VOTING TERMINATION EVENT BOARD. Upon a Voting Termination
Event that is not caused by an Initial Public Offering, the Board of Directors
of the Company shall at all times consist of at least five (5) members or such
greater number that shall be needed to satisfy the terms of this SECTION 8(b).
Each Holder of Securities hereby agrees to cause all such Securities that are
entitled to vote and are registered in the name of such Holder to be voted, and
will otherwise take or cause to be taken all such other action as may be
necessary, so that the Board of Directors shall at all times, after a Voting
Termination Event that is not caused by an Initial Public Offering, consist of:
(A) (i) a majority of Board of Directors seats designated by an OCM Entity,
PROVIDED, that the combined holdings of the OCM Entities are fifty percent (50%)
or more of the voting stock and the Voting Termination Event is due to an event
other than an OCM Entity Funding Default or an OCM Entity Purchase Default,
(ii) one (1) Board of Directors seat less than a majority designated by an OCM
Entity, PROVIDED, that either (x) the combined holdings of the OCM Entities are
at least twenty-five percent (25%) but less than fifty percent (50%) of the
voting stock or (y) the combined holdings of the OCM Entities are fifty percent
(50%) or more of the voting stock and the Voting Termination Event is due solely
to an OCM Entity Funding Default or an OCM Entity Purchase Default, or (iii) one
(1) Board of Directors seat designated by an OCM Entity, PROVIDED, that the
combined holdings of the OCM Entities are at least ten percent (10%) but
- 19 -
less than twenty-five (25%) of the voting stock (in each case, an "OCM ENTITY
TERMINATION DIRECTOR"); (B) one (1) Board of Directors seat to be the Chief
Executive Officer; (C) one (1) Board of Directors seat to be William E. Myers
Jr. and (D) the remainder of the board seats to be designated by WES&S (a
"WES&S TERMINATION DIRECTOR"); PROVIDED, that in no event shall WES&S
designate less than one (1) Board of Directors seat.
(c) INITIAL BOARD OF DIRECTORS. The Board of Directors, as of the
Closing Date, shall consist of the following members:
Stephen A. Kaplan (TCW Director)
Vincent J. Cebula (OCM Director)
(OCM Executive Director)
Richard J. Goldstein (OCM Director)
William E. Simon, Jr. (WES&S Director)
Michael B. Lenard (WES&S Director)
(WES&S Executive Director)
Conor T. Mullett (WES&S Director)
Roger E. Payton (Chief Executive Officer)
William E. Myers, Jr. (an individual)
each of whom shall hold office for a term of one (1) year until the next annual
or special meeting of Holders called for the purpose of electing directors as
provided in SECTION 8(a) AND (b) of this Agreement or in the Bylaws.
Notwithstanding the foregoing designation, upon a Voting Termination Event that
is not caused by an Initial Public Offering, the directors designated in this
SECTION 8(c) shall be subject to removal and redesignation as set forth in
SECTION 8(b) hereof.
(d) FILLING VACANCIES, ETC. At any time a vacancy is created on the
Board by the death, removal (with or without cause) or resignation of any one of
the Directors, no action shall be taken by the Board until the Board is
reconstituted with the appropriate number of directors. Only OCM or an OCM
Affiliate shall have the right to remove an OCM Director or an OCM Entity
Termination Director appointed by OCM, or to fill a vacancy caused by the
resignation, removal (with or without cause) or death of such OCM Director or
OCM Entity Termination Director. Only TCW or a TCW Affiliate shall have the
right to
- 20 -
remove a TCW Director or an OCM Entity Termination Director appointed by TCW,
or to fill a vacancy caused by the resignation, removal (with or without
cause) or death of such TCW Director or OCM Entity Termination Director.
Only WES&S shall have the right to remove a WES&S Director or to fill a
vacancy caused by the resignation, removal (with or without cause) or death
of such WES&S Director or WES&S Termination Director. For all other
vacancies, the remaining directors shall meet in person or by telephone for
the purpose of approving and appointing a director in accordance with the
provisions set forth in SECTIONS 8(a) AND (b) hereof or in the By-Laws.
(e) COMPENSATION; LIABILITY COVERAGE. William E. Myers, Jr. and any
directors who are employees of OCM, TCW or WES&S shall not be entitled to
compensation (other than reimbursement of reasonable out-of-pocket expenses
incurred in connection with board meetings or director-related activities);
PROVIDED HOWEVER, that if directors who are either employees of the Company or
are newly admitted directors after the Closing Date receive additional
compensation in their capacity as directors, then such OCM Directors, TCW
Director, WES&S Directors, William E. Myers, Jr., OCM Entity Termination
Directors or WES&S Termination Directors shall be entitled to receive an
equivalent consideration. Within sixty (60) days of the Closing Date, the
Company shall secure for the benefit of all Directors and Officers liability
coverage from a reputable insurer selected by the Company with coverages which
are not less than Five Million Dollars ($5,000,000) and deductibles which are
customary for companies of comparable size. If the Company shall ever fail to
pay when due any premium or other charge with respect to such insurance
coverage, or otherwise fail to renew such coverage, any Holder may pay such
premium or charge, or renew such coverage, and the Company shall promptly
reimburse such Holder.
(f) ADDITIONAL OCM ENTITY RIGHTS. So long as an OCM Entity owns any
Common Stock:
(i) OCM, TCW, any such OCM Affiliate or TCW Affiliate, or any
designated representative on behalf of such OCM Affiliate or TCW Affiliate
(1) shall be entitled to discuss the business operations, properties and
financial and other conditions of the Company with any authorized officer,
employee, agent, representative, director or independent accountant of the
Company and, upon reasonable notice to the Company, any such authorized
officer, agent, representative, director or independent accountant of any
Subsidiary of the Company, (2) shall be entitled to submit proposals or
suggestions to the Company's management from time to time with the
requirement that the management of the
- 21 -
Company and, upon reasonable notice to the Company, management of any
Subsidiary of the Company shall discuss such proposals or suggestions
with OCM, TCW, any such OCM Affiliate or TCW Affiliate, or any
designated representative on behalf of each OCM, TCW, any such OCM
Affiliate or TCW Affiliate within a reasonable period after such
submission, and (3) shall be entitled to call a meeting with the
management of the Company and, upon reasonable notice to the Company,
management of any Subsidiary of the Company at reasonable times and on
reasonable notice in order to discuss such proposals or suggestions or
for other purposes.
(ii) OCM, TCW, any such OCM Affiliate or TCW Affiliate, or any
designated representative on behalf of OCM, TCW, or such OCM Affiliate
or TCW Affiliate, shall be entitled to examine and make abstracts from
the books and records, operating reports, budgets and other financial
reports of the Company as are available to the management of the
Company, to visit and inspect the facilities of the Company and, upon
reasonable notice to the Company, the facilities of any Subsidiary of
the Company and to reasonably request information all at reasonable
times and intervals (and on reasonable notice to the Company) concerning
the general status of financial condition and operations of the Company.
(iii) Upon request, OCM, TCW, any such OCM Affiliate or TCW
Affiliate, or any designated representative on behalf of OCM, TCW or
such OCM Affiliate or TCW Affiliate, shall be entitled to receive, when
available, copies of (1) financial statements, forecasts and projections
provided to or approved by the Board of Directors of the Company and/or
(2) such other business or financial data as OCM, TCW, any such OCM
Affiliate or TCW Affiliate, or any designated representative on behalf
of OCM, TCW or such OCM Affiliate or TCW Affiliate, may reasonably
request.
(iv) each of OCM and TCW will hold, and will use its best
efforts to cause the OCM Affiliates and the TCW Affiliates, as
applicable, to hold, in strict confidence from any Person (other than
any such Affiliate or Person who has provided, or who is considering
providing, financing to the Company or purchasing securities of the
Company from OCM or an OCM Affiliate), unless (i) compelled to disclose
by judicial or administrative process or by other requirements of law or
(ii) disclosed in an action or proceeding brought by a party hereto in
pursuit of its rights or in the exercise of its remedies hereunder, all
documents and information concerning the Company furnished to it by the
Company in connection with this SECTION 8(f), except to the
-22-
extent that such documents or information can be shown to have been (a)
previously known by the party receiving such documents or information,
(b) in the public domain (either prior to or after the furnishing of
such documents or information hereunder) through no fault of such
receiving party or (c) later acquired by the receiving party from
another source if the receiving party is not aware that such source is
under an obligation to another party hereto to keep such documents and
information confidential.
(g) NONTRANSFERABILITY. Notwithstanding any other provision of
this Agreement to the contrary, the rights of OCM, TCW, WES&S and William E.
Myers, Jr. pursuant to this SECTION 8 shall not be transferable to any
transferee; PROVIDED, HOWEVER, that each of OCM, TCW and WES&S may transfer
their rights pursuant to this SECTION 8 to an OCM Affiliate, a TCW Affiliate
or a WES&S Affiliate, respectively.
(h) VOTING AGREEMENT. All parties to this Agreement agree that
this SECTION 8 shall constitute a voting agreement within the meaning of
Section 218 of the Delaware General Corporation Law and, subject to the other
express terms of this Agreement, shall be of the maximum duration permitted
under the Delaware General Corporation Law.
SECTION 9. CORPORATE GOVERNANCE. (a) BOARD VOTING; MANAGEMENT.
Prior to a Voting Termination Event and except with respect to the daily
affairs and operations of the Company arising in the ordinary course of
business, which affairs shall be attended to by the officers of the Company
under the ultimate direction of the Board of Directors, no action shall be
taken, securities issued, monies borrowed, sum expended, decision made or
obligation incurred by or on behalf of the Company or any of its Subsidiaries
with respect to any matter, unless approved by at least six (6) Directors or
as set forth in SECTION 9(b) below.
(b) EXECUTIVE COMMITTEE. Prior to a Voting Termination Event, an
Executive Committee (the "EXECUTIVE COMMITTEE") consisting of three (3)
members of the Board of Directors shall be authorized to take any action on
behalf of the Board of Directors (in between meetings of the Board of
Directors) upon the unanimous approval of such Executive Committee,
including, without limitation, the declaration of dividends, the issuance of
shares of capital stock or any other equity or debt security, or option or
security convertible into equity or debt securities, of the Company, and the
adoption of a certificate of ownership and merger pursuant to Section 253 of
the Delaware General Corporation Law. Each of OCM and WES&S shall designate
one (1) OCM Director (an "OCM EXECUTIVE DIRECTOR") and one (1) WES&S
-23-
Director (a "WES&S EXECUTIVE DIRECTOR"), respectively, to sit on the
Executive Committee; and the third member of the Executive Committee shall be
the Chief Executive Officer of the Company. Only OCM shall have the right to
remove (with or without cause) an OCM Executive Director or to fill a vacancy
caused by the resignation, removal or death of such OCM Executive Director.
Only WES&S shall have the right to remove (with or without cause) a WES&S
Executive Director or to fill a vacancy caused by the resignation, removal or
death of such WES&S Executive Director.
(c) AUDIT AND COMPENSATION COMMITTEES. The Board of Directors
may, by resolution passed by a majority of the total number of directors
which the Company would at the time have if there were no vacancies,
designate an audit committee of the Board of Directors (the "AUDIT
COMMITTEE"), which shall be responsible for reviewing the scope of the
Company's independent auditors' examination of the Company's financial
statements and receiving and reviewing their reports, and a compensation
committee of the Board of Directors (the "COMPENSATION COMMITTEE"), which
shall be responsible and have authority for determining the Company's
policies with respect to the nature and amount of all compensation to be paid
to the Company's executive officers and administering the Company's benefit
plans and shall also have the authority to issue shares of capital stock or
any other equity or debt security, or option or security convertible into
equity or debt securities, of the Company. Prior to a Voting Termination
Event each of the Audit Committee and the Compensation Committee shall
consist of two members, one of whom shall be an OCM Director that is
designated for membership on such committee by OCM and one of whom shall be a
WES&S Director that is designated for membership on such committee by WES&S.
Only OCM shall have the right to remove an OCM Director who is a member of
the Audit Committee or Compensation Committee or to fill a vacancy on the
Audit Committee or Compensation Committee caused by the resignation, removal
or death of such OCM Director. Only WES&S shall have the right to remove a
WES&S Director who is a member of the Audit Committee or Compensation
Committee or to fill a vacancy on the Audit Committee or Compensation
Committee caused by the resignation, removal or death of such WES&S Director.
(d) SHAREHOLDER VOTING. Prior to a Voting Termination Event, all
such actions taken by, in the name of or on behalf of the holders of Common
Stock shall require an affirmative vote of the holders representing at least
eighty percent (80%) of the issued and outstanding shares entitled to vote.
Upon a Voting Termination Event, all such actions taken by, in the name of or
on behalf of the holders of Common Stock shall require an affirmative vote of
a majority of the issued and outstanding shares entitled to vote.
-24-
SECTION 10. CERTIFICATES.
(a) RESTRICTIVE ENDORSEMENTS. Each certificate evidencing any
Securities shall bear a legend in substantially the following form:
"The [shares][warrant] evidenced by this certificate [and the shares
of Common Stock into which any Warrant represented hereby is
convertible] are subject to that certain [a Warrant, dated as of
_________,] [Subscription Agreement, dated as of _________,] [Employee
Stock Purchase Plan, dated as of ________,] [Preferred Stock Purchase
Agreement, dated as of _______,] a Stockholders Agreement, dated as of
________, and Registration Rights Agreement, dated as of ___________
copies of which are on file at the principal office of the Company and
will be furnished to the holder on request to the Secretary of the
Company. Such [Warrant,] [Subscription Agreement] [Employee Stock
Purchase Plan] [Preferred Stock Purchase Agreement] Stockholders
Agreement and Registration Rights Agreement provide, among other
things, for certain restrictions on voting, sale, transfer, pledge,
hypothecation or other disposition of the (securities) [warrant]
evidenced by this certificate [and the shares of Common Stock
purchasable upon exercise of the warrant] and that such securities may
be subject to purchase by the Company as well as certain other persons
upon the occurrence of certain events. Any issuance, sale,
assignment, transfer or other disposition of the securities evidenced
by this certificate to persons who are not party to such Stockholders
Agreement shall be null and void."
In addition, unless counsel to the Company has advised the Company that
such legend is no longer needed, each certificate evidencing the Securities
shall bear a legend in substantially the following form:
"The securities [warrant] evidenced by this certificate [and the
shares of common stock purchasable upon exercise of the warrant] have
not been registered pursuant to the Securities Act of 1933, as amended
(the "Act"), or any state securities law, and such securities
[warrant] may not be sold, transferred or otherwise disposed of unless
the same are registered and qualified in accordance with the Act and
any applicable state securities laws, or in the opinion of counsel
-25-
reasonably satisfactory to the Company such registration and
qualification are not required."
(b) REPLACEMENT CERTIFICATES. Upon receipt by the Company of
evidence reasonably satisfactory to it of the loss, theft, destruction or
mutilation of any certificate evidencing any Securities, and (in the case of
loss, theft or destruction) of indemnity reasonably satisfactory to the
Company, upon surrender and cancellation of such certificate or receipt of
such indemnity, the Company will execute, register and deliver a new
certificate of like tenor in lieu of such lost, stolen, destroyed or
mutilated certificate.
SECTION 11. REPRESENTATIONS. Each Holder represents that such
Holder is the record and beneficial owner of the number of issued and
outstanding Securities appearing opposite such Holder's name in Exhibit A
attached hereto, free and clear of any option, lien, encumbrance or charge of
any kind whatsoever.
SECTION 12. 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.
SECTION 13. 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) (A) if to the Company, at
13952 Denver West Parkway
Golden, Colorado 80401
Facsimile No.: (303) 704-4410
Attention: Chief Executive Officer
(B) with copies to OCM, TCW and WES&S, at the respective
addresses set forth below
-26-
(ii) if to TCW or OCM, at
TCW Special Credits Fund V - The Principal Fund
C/O Oaktree Capital Management, LLC
555 South Hope St., 22nd Floor
Los Angeles, CA 90071
Facsimile No.: (213) 694-1593
Attention: Vincent J. Cebula
OCM Principal Opportunities Fund, L.P.
C/O Oaktree Capital Management, LLC
555 South Hope St., 22nd Floor
Los Angeles, CA 90071
Facsimile No.: (213) 694-1593
Attention: Vincent J. Cebula
with copies to:
Oaktree Capital Management, LLC
550 South Hope Street
22nd Floor
Los Angeles, California 90071
Facsimile No.: (213) 694-1599
Attention: Kenneth Liang, Esq.
Milbank, Tweed, Hadley & McCloy
601 South Figueroa Street
30th Floor
Los Angeles, California 90017
Facsimile No.: (213) 629-5063
Attention: Eric H. Schunk, Esq.
(iii) if to WES&S, at
William Simon & Sons, LLC
10990 Wilshire Blvd., Suite 1750
Los Angeles, CA 90024
Facsimile No.: (310) 575-3258
Attention: Michael Lenard
with copies to:
Latham & Watkins
633 West Fifth Street
Suite 4000
Los Angeles, California 90071-2007
Facsimile No.: (213) 891-6763
Attention: Paul D. Tosetti, Esq.
-27-
(iv) 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.
(b) 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.
(c) 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.
(d) GOVERNING LAW. This Agreement shall be construed in
accordance with and governed by the laws of the State of Delaware without
regard to principles of conflict of laws.
(e) FILING. A copy of this Agreement and of all amendments hereto
shall be filed at the principal office of the Company.
-28-
(f) AMENDMENT OR TERMINATION. Prior to a Voting Termination
Event, (i) the provisions of this Agreement relating exclusively to Common
Stock or Securities other than Preferred Stock may be amended or terminated
at any time only by an instrument in writing signed by the Company and the
Holders beneficially owning at least eighty percent (80%) of the issued and
outstanding shares of Common Stock, (ii) the provisions of this Agreement
relating exclusively to Preferred Stock may be amended or terminated at any
time only by an instrument in writing signed by the Company and the Holders
beneficially owning at least eighty percent (80%) of the issued and
outstanding Preferred Stock, and (iii) the provisions of this Agreement
relating to Common Stock, Securities other than Preferred Stock and Preferred
Stock may be amended or terminated only by an instrument in writing signed by
the Company and Holders of eighty percent (80%) of the issued and outstanding
shares of Common Stock and eighty percent (80%) of the issued and outstanding
shares of Preferred Stock. Upon a Voting Termination Event, this Agreement
may be amended or terminated at any time by an instrument in writing signed
by the Company and the Holders beneficially owning a majority of the issued
and outstanding shares entitled to vote. Notwithstanding the foregoing, (i)
no amendment or modification to SECTION 8 OR 9 hereof may be made without the
consent of the Holders beneficially owning ninety percent (90%) of the issued
and outstanding Common Stock and (ii) upon receiving the unanimous written
consent of each of the OCM Entities and WES&S, the Company may (A) add new
Holders to this Agreement by attaching a supplemental signature page dated as
of the date of execution and (B) amend Exhibits A and B.
(g) BENEFIT AND BINDING EFFECT. Except as otherwise provided in
this Agreement, no right under this Agreement shall be assignable and any
attempted assignment in violation of this provision shall be void. Subject
to compliance with the terms of this Agreement regarding Transfer of
Securities, this Agreement shall be binding upon and inure to the benefit of
the parties and their executors, administrators, personal representatives,
heirs, successors and permitted assigns. Except as set forth in this
SUBSECTION (g), this Agreement does not create and shall not be construed as
creating any rights enforceable by any Person not a party hereto.
(h) SEVERABILITY. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance,
is held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provisions in every other respect and of the
remaining provisions contained herein shall not be affected or impaired
thereby.
-29-
IN WITNESS WHEREOF, the parties hereto have executed this Fourth
Amended and Restated Stockholders Agreement as of the day and year first
above written.
The Company: GEOLOGISTICS CORPORATION
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
Managing Director
LOGISTICAL SIMON, L.L.C.
By: WESINVEST, Inc.
its Manager
By: /s/ Michael B. Lenard
----------------------------------
Michael B. Lenard
President
[signature page continues]
ING CAPITAL (U.S.) CORPORATION
By: /s/
----------------------------------
Name:
Title:
BANQUE PARIBAS
By: /s/ Steven M. Heinen
----------------------------------
Name:
Title:
PARIBAS NORTH AMERICA, INC.
By: /s/ John G. Martinez
----------------------------------
Name:
Title:
/s/ Roger E. Payton
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Roger E. Payton, as an individual
/s/ Gary Holter
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Gary Holter, as an individual
/s/ Larry Marzullo
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Larry Marzullo, as an individual
/s/ William E. Myers, Jr.
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William E. Myers, Jr., as an individual
/s/ Kurt Kamm
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Kurt Kamm, as an individual
/s/ William Kidd
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William Kidd, as an individual
/s/ David W.M. Harvey
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David W.M. Harvey, as an individual
[signature page continues]
/s/ Brian E. Sanderson
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Brian E. Sanderson, as an individual
/s/ Edward R. Mandell
------------------------------------
Edward R. Mandell, as an individual
/s/ Kenneth S. Ogden
------------------------------------
Kenneth S. Ogden, as an individual
/s/ James L. Mazzuca
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James L. Mazzuca, as an individual
/s/ Mark Lundgren
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Mark Lundgren, as an individual
/s/ Paul Stone
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Paul Stone, as an individual
/s/ Christine Stone
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Christine Stone, as an individual
/s/ Douglas Cruikshank
------------------------------------
Douglas Cruikshank, as an individual
/s/ Ronald S. Cruse
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Ronald S. Cruse, as an individual
/s/ Steve Hitchcock
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Steve Hitchcock, as an individual
/s/ Paul D. Smith
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Paul D. Smith, as an individual
/s/ Abe Ranish
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Abe Ranish, as an individual
/s/ Luis Solis
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[signature page continues]
Luis Solis, an individual
/s/ Larry Tieman
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Larry Tieman, an individual
/s/ Joe Monaghan
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Joe Monaghan, an individual
/s/ Ben Cassell
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Ben Cassell, an individual
/s/ Randy Valentino
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Randy Valentino, an individual
/s/ Diego Hidalgo
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Diego Hidalgo, an individual
/s/ Louis Mitchell
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Louis Mitchell, an individual
/s/ Sam Schotsky
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Sam Schotsky, an individual
/s/ Dave Martin
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Dave Martin, an individual
/s/ Russ Krueger
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Russ Krueger, an individual
/s/ Ove Anderson
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Ove Anderson, an individual
/s/ Jim Bruder
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Jim Bruder, an individual
/s/ Peter Schwerdt
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Peter Schwerdt, an individual
/s/ Ron Evinou
------------------------------------
Ron Evinou, an individual
/s/ Bruno Setz
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Bruno Setz, an individual
/s/ Manoutchehr Ardalan
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Manoutchehr Ardalan, an individual
/s/ J.G. Birrell
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J.G. Birrell, an individual
/s/ Donald D. Branson
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Donald D. Branson, an individual
/s/ John Connolly
------------------------------------
John Connolly, an individual
/s/ Robert J. Fruchterman
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Robert J. Fruchterman, an individual
/s/ Deborah A. MacDougall
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Deborah A. MacDougall, an individual
/s/ Mitchell J. Martin
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Mitchell J. Martin, an individual
/s/ Christian E. Meyer
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Christian E. Meyer, an individual
/s/ Stephen J. Zimmer
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Stephen J. Zimmer, an individual
/s/ Jack Wasp
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Jack Wasp, an individual
/s/ Wolfgang Hollermann
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Wolfgang Hollermann, an individual
/s/ Andrew Bernard
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[signature page continues]
Andrew Bernard, an individual
ELGAR TRADING LIMITED
By: /s/ Ronald Jackson
------------------------------------
Ronald Jackson, as attorney
in fact for Elgar Trading Limited
COTECH COMPANY INC.
By: /s/ Ronald Jackson
------------------------------------
Ronald Jackson, as attorney
in fact for Elgar Trading Limited
HERA VENTURES LIMITED
By: /s/ Ronald Jackson
------------------------------------
Ronald Jackson, as attorney
in fact for Elgar Trading Limited
/s/ Anthony J. Quinn
------------------------------------
Anthony J. Quinn, an individual
/s/ Sergey Kuzminykh
------------------------------------
Sergey Kuzminykh, an individual
/s/ Audrey Jackel
------------------------------------
Audrey Jackel, an individual
/s/ Sherry Aaholm
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Sherry Aaholm, an individual
/s/ Grant Wattman
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Grant Wattman, an individual
/s/ Charlie Hitt
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Charlie Hitt, an individual
/s/ Mark Jerome
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Mark Jerome, an individual
[signature page continues]
/s/ Ron Jackson
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Ron Jackson, an individual
/s/ George Milton
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George Milton, an individual
/s/ John Thompson
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John Thompson, an individual
/s/ George Papageorghiou
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George Papageorghiou, an individual
/s/ Hugh Dunn
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Hugh Dunn, an individual
/s/ Michael Tindall
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Michael Tindall, an individual
/s/ Richard Charles
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Richard Charles, an individual
/s/ Steven Pringle
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Steven Pringle, an individual
/s/ Mats Hoberg
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Mats Hoberg, an individual
/s/ Gerd Kunath
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Gerd Kunath, an individual
/s/ Philip Brown
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Philip Brown, an individual
/s/ Wolfgang Hollerman
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Wolfgang Hollerman as attorney for
James Hill, an individual
[signature page continues]
/s/ Thomas Peikert
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Thomas Peikert, an individual
/s/ Olaf Tauschke
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Olaf Tauschke, an individual
/s/ Ricky Lam
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Ricky Lam, an individual
/s/ Gil Cruz
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Gil Cruz, an individual
/s/ Helmut Volquarts
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Helmut Volquarts, an individual
/s/ Mykell Lee
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Mykell Lee, an individual
/s/ Wilfred Toedter
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Wilfred Toedter, an individual
/s/ Terry Clarke
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Terry Clarke, an individual
/s/ Ken Batko
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Ken Batko, an individual
/s/ Brian Gallagher
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Brian Gallagher, an individual
/s/ Jeff Conry
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Jeff Conry, an individual
/s/ Fred Landgraf
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Fred Landgraf, an individual
[signature page continues]
/s/ Thomas E. Hickey
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Thomas E. Hickey, an individual
/s/ Chris Callas
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Chris Callas, an individual
/s/ Dan Moore
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Dan Moore, an individual
/s/ Eric Ramsay
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Eric Ramsay, an individual
[signature page continues]