INVESTORS' AGREEMENT
This INVESTORS' AGREEMENT (this "AGREEMENT") is made as of June
17, 2003, between United Road Services, Inc., a Delaware corporation (the
"COMPANY"), Blue Truck Acquisition, LLC, a Delaware limited liability company
("BLUE TRUCK"), CFE, Inc., a Delaware corporation ("CFE"), Charter URS LLC, a
Delaware limited liability company ("CHARTER") and Xxxxxxx Xxxxxxx ("XXXXXXX",
and together with Blue Truck, CFE and Charter, the "INVESTORS").
WHEREAS, the Company and Blue Truck have entered into that
certain Exchange Agreement, dated as of even date herewith (the "BLUE TRUCK
EXCHANGE AGREEMENT"), pursuant to which, among other things, the Company is
issuing shares of its Series B Participating Convertible Preferred Stock
("SERIES B PREFERRED") to Blue Truck;
WHEREAS, the Company and CFE have entered into that certain
Exchange Agreement, dated as of even date herewith (the "CFE EXCHANGE
AGREEMENT"), pursuant to which, among other things, the Company is issuing
shares of Series B Preferred to CFE;
WHEREAS, the Company and Charter have entered into that certain
Exchange Agreement, dated as of even date herewith (the "CHARTER EXCHANGE
AGREEMENT", and together with the Blue Truck Exchange Agreement and the CFE
Exchange Agreement, the "EXCHANGE AGREEMENTS"), pursuant to which, among other
things, the Company is issuing shares of its Series C Participating Convertible
Preferred Stock ("SERIES C PREFERRED") to Charter;
WHEREAS, the Company has issued options (the "OPTIONS") to
purchase shares of Series C Preferred to Xxxxxxx and Charter pursuant to a
Credit Enhancement Agreement, dated as of even date herewith, by and among the
Company, Xxxxxxx and Charter (the "CREDIT ENHANCEMENT AGREEMENT"); and
WHEREAS, the execution and delivery of this Agreement is a
condition to the closing of the Exchange Agreements and the issuance of the
Options pursuant to the Credit Enhancement Agreement.
NOW, THEREFORE, in consideration of the mutual promises and
agreements set forth herein, and for other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the parties hereto agree
as follows:
1. DEFINITIONS.
As used in this Agreement, the following terms shall have the
meanings set forth below:
1.1 "AFFILIATE" of a Person means any other Person who is controlled
by, controls or is under common control with such Person.
1.2 "ANCILLARY AGREEMENTS" means the Exchange Agreements, the Credit
Enhancement Agreement and other documents executed and delivered in connection
herewith and therewith.
1.3 "CLOSING" means the closing of the transactions contemplated by
the Exchange Agreements.
1.4 "CLOSING DATE" means the date on which the Closing occurs.
1.5 "COMMON STOCK" means the common stock of the Company.
1.6 "COMPANY BOARD" means the Board of Directors of the Company.
1.7 "CONVERSION TRIGGER DATE" shall have the meaning given to such
term in Section 5(a) of the certificates of designations relating to the
Preferred Stock.
1.8 "CONVERTED SHARES" means the shares of Common Stock actually
received by the Original Holders upon conversion of some or all of the shares of
Series B Preferred or Series C Preferred.
1.9 "CURRENT COMPANY DIRECTORS" means the members of the Board of
Directors of the Company as constituted immediately prior to the Closing.
1.10 "INVESTOR NOMINEE" has the meaning set forth in Section 2.1.2
1.11 "MAJORITY HOLDERS" shall mean the holders of a majority of the
outstanding shares of Series C Preferred.
1.12 "ORIGINAL HOLDERS" shall mean the Investors and any Permitted
Transferees who execute an agreement to be bound by the terms and the conditions
of this Agreement.
1.13 "PERMITTED TRANSFEREE" means any Affiliate, partner, member or
stockholder of an Investor.
1.14 "PERSON" means an individual, corporation, limited liability
company, partnership, association, trust or any other entity or organization.
1.15 "PREFERRED STOCK" means the Series B Preferred and Series C
Preferred.
1.16 "QUALIFIED PUBLIC OFFERING" shall means a firm commitment
underwritten public offering of Common Stock by the Company after the date
hereof, that is first issued with a nationally recognized investment banking
firm at a price per share offered to the public of at least $0.02 (as adjusted
for any stock splits, stock dividends, combinations, recapitalizations,
reclassifications or other similar events), in a total offering including gross
proceeds of at least $30,000,000 before deduction of underwriting commissions
and expenses of the offering.
1.17 "STOCK" means the capital stock of the Company.
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1.18 "STOCKHOLDERS" means all of the holders of capital stock of the
Company and "Stockholder" shall mean any such Person.
1.19 "TRANSFER" means to sell, assign, transfer (voluntarily or
involuntarily), exchange (by merger or otherwise) or otherwise dispose of.
2. CORPORATE GOVERNANCE.
2.1 ELECTION OF DIRECTORS.
2.1.1 RESIGNATION OF DIRECTORS AND FILLING OF VACANCIES.
Effective as of the Closing, the Current Company Directors that are listed on
SCHEDULE A to this Agreement, shall resign as directors, such resignations to be
evidenced by letters of resignation delivered to the Company on or prior to the
Closing Date, and the remaining Current Company Directors shall fill the
vacancies caused by such resignations with the persons listed on SCHEDULE B to
this Agreement, such that immediately after the Closing, the Company Board shall
consist of seven (7) members, I.E., four (4) members designated by Charter, one
member designated by Blue Truck, Xxxxxxx and Xxxxxx Xxxxxxxx ("XXXXXXXX").
2.1.2 RIGHT TO APPOINT DIRECTORS. From and after the Closing:
(a) The Majority Holders may, from time to time, cause the
number of directors that compose the Company Board to increase or decrease.
(b) Blue Truck (or one of its designated Affiliates) shall
have the right to designate one member to the Company Board (the "BLUE TRUCK
NOMINEE"), on the terms and conditions provided in the certificate of
designations relating to the Series B Preferred.
(c) Charter (or one of its designated Affiliates) shall
have the right to designate members to the Company Board ("SERIES C NOMINEES",
and together with the Blue Truck Nominee, the "INVESTOR NOMINEES"), on the terms
and conditions provided in the certificate of designations relating to the
Series C Preferred.
(d) Xxxxxxx shall be entitled to serve as a member of the
Company Board for so long as he remains continuously employed by the Company.
Xxxxxxxx shall not have such right.
(e) If at any time Charter elects to designate less members
to the Company Board than it is otherwise entitled under the certificate of
designations relating to the Series C Preferred, the Investors and the Company
shall take all necessary corporate action to vest the appropriate number of
Company Board votes (I.E., the number of Series C Nominees Charter is entitled
to designate) in the existing Series C Designees, including, but in no way
limited to, the designation of the Series C Designees as directors with more
than one vote.
2.2 REMOVAL AND REPLACEMENT OF DIRECTORS.
2.2.1 REMOVAL OF INVESTOR NOMINEES.
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(a) If at any time Charter (or one of its designated
Affiliates) notifies the Company Board of its wish to remove any Series C
Nominee from the Company Board, or Blue Truck (or one of its designated
Affiliates) notifies the Company Board of its wish to remove the Blue Truck
Nominee from the Company Board, the Investors shall use their best efforts to
cause the Company Board to vote to remove the applicable Investor Nominee
provided that such Investor Nominee can be removed in accordance with the
Company's Bylaws and the Delaware General Corporation Law. If the Company Board
fails to remove such Investor Nominee, the Investors shall vote all their shares
of Stock to so remove the applicable Investor Nominee provided that he or she
may be removed in accordance with the Company's Bylaws and the Delaware General
Corporation Law.
(b) Removal of an Investor Nominee by the Company Board or
the Investors requires the prior written consent of Charter (or one of its
designated Affiliates), if he or she is a Series C Nominee and Charter continues
to have the right to appoint a successor to such Series C Nominee under the
certificate of designations relating to the Series C Preferred, or Blue Truck
(or one of its designated Affiliates), if he or she is a Blue Truck Nominee and
Blue Truck continues to have the right to appoint a director under the
certificate of designations relating to the Series B Preferred, unless such
removal is based upon the gross negligence or willful misconduct of the
applicable Investor Nominee.
2.2.2 REPLACEMENT OF DIRECTORS. If at any time after the Closing
Date, a vacancy is created on the Company Board by reason of the incapacity,
death, removal or resignation of, or the expiration of the term of, any Investor
Nominee, then: (i) if such Investor Nominee was a Series C Nominee and Charter
(or one of its designated Affiliates) continues to have the right to appoint a
successor to such Series C Nominee, Charter (or one of its designated
Affiliates) shall be entitled to designate an individual to fill such vacancy
and (ii) if such Investor Nominee was a Blue Truck Nominee, Blue Truck (or one
of its designated Affiliates), as long as Blue Truck continues to have the right
to designate a director under the certificate of designations relating to the
Series B Preferred, shall be entitled to designate an individual to fill such
vacancy. If at any time after the Closing Date, a vacancy is created on the
Company Board by reason of the incapacity, death, removal or resignation of, or
the expiration of the term of, any member of the Company Board that is not an
Investor Nominee, such vacancy shall be filled in accordance with governing
documents of the Company and applicable law.
2.2.3 STOCKHOLDER MEETINGS. At each meeting of Stockholders of
the Company at which directors are elected, the nominees for directors proposed
by the Company Board shall include those nominees as are necessary to comply
with Section 2.1.2, including Xxxxxxx in accordance with Section 2.1.2(d). Each
of the Original Holders shall vote its shares of Stock and each Original Holder
shall take all other actions necessary, to designate directors in accordance
with this Section 2 and ensure that the Company's Certificate of Incorporation
and Bylaws facilitate and do not at any time conflict with any provision of this
Agreement.
2.3 BOARD MEMBERS. All Investor Nominees and Xxxxxxx (in his capacity
as a director) shall be entitled to the same indemnification rights as are
accorded the other members of the Company Board. The Company shall at all times
maintain a directors' and officers' insurance policy covering all the members of
the Company Board.
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3. PREEMPTIVE RIGHTS.
3.1 The Company shall not issue any Common Stock or other Stock or
any securities convertible into or exchangeable into Common Stock or other Stock
or an option or right to acquire Common Stock or other Stock (the "OFFERED
SHARES") for cash (or any other form of consideration in the case of an issuance
to Charter or any of its Affiliates) without first complying with this Section
3, unless such issuance is (i) pursuant to any stock option plan, stock purchase
plan or other benefit plan, in each case for directors, officers and/or
employees and approved by the Company Board, (ii) pursuant to a registration
statement of the Company that is declared effective by the Securities and
Exchange Commission, or (iii) with respect to the exercise or conversion of
securities convertible into or exchangeable into Common Stock or other Stock or
options or rights to acquire Common Stock or other Stock.
3.2 In the event that the Company proposes to make an issuance
requiring compliance with this Section 3, it shall first offer in writing (the
"PREEMPTIVE OFFER") to each Original Holder the right to purchase, at the same
price, subject to Section 3.4, and on the same terms as the proposed issuance
giving rise to the Preemptive Offer, a number of Offered Shares equal to the
product of (a) the total number of Offered Shares and (b) a fraction, the
numerator of which is the number of Converted Shares owned by such Original
Holder and/or shares of Common Stock into which all shares of Series B Preferred
and/or Series C Preferred owned by such Original Holder is then convertible (or
would be convertible following the Conversion Trigger Date) and the denominator
of which is the total number of outstanding shares of Common Stock (on a fully
diluted basis after giving effect to the conversion or exchange, as applicable,
of all in-the-money securities convertible into or exchangeable into, or options
or rights to acquire, Common Stock). The Preemptive Offer shall be sent to the
Original Holders not less than 30 days prior to the proposed consummation of
such issuance. The Original Holders shall have the right to accept the
Preemptive Offer for all, but not less than all, of the Offered Shares offered
to it under the Preemptive Offer by written notice to the Company within 15 days
of receipt by it of the Preemptive Offer. Any such acceptance shall be
irrevocable.
3.3 In the event that an Original Holder shall accept a Preemptive
Offer, the closing of the sale and purchase of the applicable Offered Shares
shall occur, subject to Section 3.4, within 15 days after acceptance may be made
or simultaneously with the sale of Offered Shares giving rise to the obligation
of the Company to make the Preemptive Offer, whichever is later, except that the
Company Board may determine to cancel the sale of shares of capital stock giving
rise to the obligation of the Company to make the Preemptive Offer under this
Section 3, in which case no such sale and purchase is required to occur. In the
event that such closing does not occur within the time period prescribed by this
Section 3.3, any subsequent issuance of securities must be made in accordance
with the terms of this Section 3, if applicable.
3.4 In the event of an issuance of shares other than for cash, an
Original Holder that has, and elects to exercise, rights under this Section 3
shall purchase the shares offered to it under the Preemptive Offer for cash at a
price per share equal to the value per share received by the Company for the
Offered Shares. Such price per share shall be determined by the Board of
Directors in good faith and with due care. If the majority of the Original
Holders that have elected to purchase shares pursuant to this Section 3 object
to such valuation (the
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"OBJECTING HOLDERS"), in writing, within 10 days after being notified of such
valuation (the "OBJECTION NOTICE"), the valuation shall be determined by an
arbitrator mutually selected by a majority of the Objecting Holders and the
Board of Directors, or in the event a single arbitrator cannot be agreed upon
within 3 days after the Objection Notice, the valuation shall be determined by
an arbitration in which (i) the Objecting Holders shall have named in the
Objection Notice an arbitrator, (ii) the Board of Directors shall name a second
arbitrator within 5 days from the receipt of the Objection Notice, (iii) the
arbitrators selected by the Objecting Holders and the Board of Directors shall
together select a third arbitrator within 5 days thereafter, and (iv) the three
arbitrators thus selected shall determine the valuation within 5 days
thereafter. The costs of such arbitration shall be borne equally by the Company
and by the Objecting Holders, and as among the Objecting Holders, pro rata based
on the number of shares held on an as-converted basis. Such determination of
value and the sharing of costs by the Objecting Holders shall be binding on all
Objecting Holders and any Original Holders that accept such Preemptive Offer.
Notwithstanding anything herein to the contrary, this Section 3.4 shall not be
construed to prevent or otherwise delay the closing of the offer and sale of the
Offered Shares giving rise to the applicable Preemptive Offer and the procedures
and determinations set forth in this Section 3.4 may occur after such closing
and, the closing of the Preemptive Offers that have been accepted shall occur as
soon as reasonably practicable (but no more than 15 days) after completion of
such procedures and determinations.
4. TAG-ALONG RIGHTS.
4.1 TAG-ALONG RIGHTS OF THE SERIES B PREFERRED.
4.1.1 If any Original Holder or Affiliated group of Original
Holders proposes, in a single, bona fide, arm's length transaction or a series
of related bona fide, arm's length transactions, to Transfer (such Original
Holders being collectively the "TAGGED HOLDER") 10% or more of the total number
of outstanding shares of Series C Preferred to transferees other than its
Permitted Transferees, the Tagged Holder shall, at least 20 days prior to the
closing that would trigger the obligations under this Section 4.1, give notice
thereof to all other Original Holders (the "TAG-ALONG NOTICE"). The Tag-Along
Notice shall identify the proposed purchaser, the consideration per share to be
paid by such purchaser and the other material terms and conditions of the
proposed Transfer and, in the case of a Transfer in which the consideration
payable consists in part or in whole of consideration other than cash, such
information relating to such consideration as any such other Original Holder may
reasonably request as being necessary to evaluate such non-cash consideration
(it being understood that such request shall not obligate a Tagged Holder to
deliver any information to the other Original Holders not reasonably available
to such Tagged Holder).
4.1.2 Each Original Holder receiving a Tag-Along Notice shall
have the right, exercisable as set forth below, to Transfer to the proposed
transferee on the same terms as are set forth in the Tag-Along Notice, except as
otherwise provided in this Section 4, up to the number of shares of Series B
Preferred owned by such Original Holder at the time of the proposed Transfer,
multiplied by a fraction (i) the numerator of which is the number of shares of
Common Stock into which the Series C Preferred to be acquired by the transferee
is then convertible (or would be convertible following the Conversion Trigger
Date), and (ii) the denominator of which is the total number of shares of Common
Stock into which all shares of Series B Preferred and Series C Preferred owned
(beneficially and of record) by the Tagged
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Holder and all other Original Holders is then convertible (or would be
convertible following the Conversion Trigger Date). The number of shares of
Series C Preferred to be Transferred by the Tagged Holder shall be reduced by
the aggregate amount of shares Transferred by the Tagging Holders.
4.1.3 Each Original Holder's rights under this Section 4.1 may be
exercised by giving written notice (which shall be irrevocable) to the Tagged
Holder during the period (the "TAG-ALONG OFFER PERIOD") which is 10 days after
the delivery to it of the Tag-Along Notice. The failure by any Original Holder
to so notify the Tagged Holder within such Tag-Along Offer Period shall be
deemed an election by such Original Holder not to exercise its rights under this
Section 4.1.
4.1.4 The Tagged Holder shall have 120 days from the termination
of the Tag-Along Offer Period to consummate the Transfer contemplated by the
Tag-Along Notice to the proposed transferees at the price and on terms no more
favorable to the proposed transferee(s) than those contained in the Tag-Along
Notice. If the Tagged Holder has not completed the Transfer contemplated by the
Tag-Along Notice within such 120-day period, then the rights of the Tagged
Holder and the Original Holders pursuant to this Section 4.1 shall terminate as
to such proposed Transfer and the Tagged Holder shall again comply with the
procedures set forth in this Section 4.1 with respect to that Transfer and any
subsequent proposed Transfer that is subject to this Section 4.1.
4.1.5 Promptly (but no more than 5 business days) after the
consummation of the Transfer of the Series B Preferred and Series C Preferred as
to which one or more Original Holders have elected to participate pursuant to
this Section 4.1 (each participating Original Holder being a "TAGGING HOLDER")
or, the determination of the value of the consideration pursuant to Section 4(b)
of the certificates of designations relating to the Preferred Stock, if other
than cash or cash equivalents, whichever is earlier, the Tagged Holder shall
notify the Tagging Holders thereof, shall remit to each of them its share of the
total consideration (to be determined as set forth below), and shall furnish
such other evidence of such Transfer and the terms thereof as may be reasonably
requested by the Tagging Holders. Notwithstanding the foregoing, the Tagging
Holders shall be required (i) to bear their share of any escrows, holdbacks or
adjustments in purchase price established pursuant to the agreement evidencing
such Transfer proportionate to the Tagging Holder's share of the total
consideration and (ii) to make such representations, warranties and covenants
and enter into such agreements customarily made by selling minority stockholders
in similar transactions regarding (x) ownership of the shares to be transferred
(including the absence of any liens), (y) due authority, and (z) other customary
matters. For purposes of this Section 4, the Tagged Holder's and each Tagging
Holder's share of the total consideration paid by the purchaser of shares shall
be determined and allocated as though such total consideration were being
distributed to such Original Holders (on a per share basis) pursuant to a
Liquidation Event (as such term is defined in Section 4(a) of the certificates
of designations relating to the Preferred Stock) in accordance with Section 4 of
the certificates of designations relating to the Preferred Stock, solely as it
relates to those shares being sold in the Transfer pursuant to this Section 4,
and as though the shares sold in the Transfer pursuant to this Section 4 were
the only outstanding shares of the Company at the time of such Liquidation
Event.
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4.1.6 Notwithstanding anything contained in this Section 4.1,
there shall be no liability on the part of the Tagged Holder to other Original
Holders if the Transfer pursuant to this Section 4.1 is not consummated for
whatever reason. The determination of whether to effect a Transfer of Stock
pursuant to this Section 4.1 by the Tagged Holder is in the sole and absolute
discretion of the Tagged Holder.
4.2 CLOSING. In the event that the rights of an Original Holder under
Section 4.1 shall be exercised, each Tagging Holder shall cause the stock
certificate or certificates representing the shares covered by such Transfer to
be delivered to a representative of the Tagged Holder, duly endorsed for
transfer with all applicable stock transfer tax stamps attached, paid or
otherwise provided for by such Tagging Holder together with such other documents
and instruments as such representative may reasonably request in connection with
such Transfer.
5. DRAG-ALONG RIGHTS.
5.1 DRAG-ALONG RIGHTS OF THE SERIES C PREFERRED.
5.1.1 If any Original Holder or Affiliated group of Original
Holders owning Series C Preferred (other than Xxxxxxx) proposes in a single,
bona fide, arm's length transaction or a series of related, bona fide, arm's
length transactions (such Original Holder(s) being collectively, the "DRAGGING
HOLDER") to either (a) Transfer 10% or more of the total number of outstanding
shares of Series C Preferred other than sales in the open market or (b) cause
the Company to sell all or substantially all of its assets, in each case to an
unaffiliated third party, then, upon written notice to all other Original
Holders (each a "DRAGGED Holder") and the Company (a "DRAG-ALONG NOTICE"), the
Dragging Holder shall have the right to cause each, but not less than all, of
the Dragged Holders to participate in such Transfer (a "DRAG-ALONG TRANSACTION")
as set forth below. Notwithstanding anything in this Agreement to the contrary,
in the event the Dragging Holder proposes to Transfer less than a majority of
the total number of outstanding shares of Converted Shares and/or Series C
Preferred owned by it, such Dragging Holder shall not have the right to cause
the other Original Holders to participate in the Transfer, and such Original
Holders shall not have any obligation, under this Section 5 unless the
consideration received by each such Dragged Holder in connection with such
Transfer is equal to or greater than the Series B Preferred Base Liquidation
Amount (as defined in the certificate of designations relating to the Series B
Preferred) per share of Series B Preferred being Transferred.
5.1.2 Any Drag-Along Notice shall contain (1) the name and
address of the proposed transferee(s), (2) the proposed purchase price, terms of
payment and other material terms and conditions of the proposed Drag-Along
Transaction, and (3) the number of shares of the Dragged Holder's Series B
Preferred and/or Converted Shares to be included in the Transfer (the "DRAGGED
SHARES"), which may be up to the number of shares of Series B Preferred and
Converted Shares owned by such Dragged Holder at the time of the proposed
Transfer, multiplied by a fraction (i) the numerator of which is the number of
shares of Converted Shares and/or Series C Preferred (on an as-converted basis)
to be sold by the Dragging Holder, and (ii) the denominator of which is the
total number of Converted Shares and/or shares of Series C Preferred (on an
as-converted basis) owned by the Dragging Holder immediately prior to such
Transfer.
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5.1.3 Each Dragged Holder shall consent to and raise no objection
with respect to (and will not exercise statutory appraisal rights in connection
with) the transaction described in the Drag-Along Notice and will, at the option
of the Dragging Holder, agree to Transfer the Dragged Shares to the proposed
transferee as part of such transaction, on the same terms as are set forth in
the Drag-Along Notice, except as otherwise provided in this Section 5. After
delivery of a Drag-Along Notice, the Dragging Holder shall provide any Dragged
Holder with any written information regarding the proposed Transfer as
reasonably requested by such Dragged Holder. If such transaction is structured
as a sale of stock, within 10 days following the date of the Drag-Along Notice,
each of the Dragged Holders shall deliver to a representative of the Dragging
Investor designated in the Drag-Along Notice certificates representing all of
the shares of Series B Preferred and/or Converted Shares to be transferred by
such Dragged Holder, duly endorsed for Transfer with all applicable stock
transfer tax stamps attached, paid or otherwise provided for by such Dragged
Holder, together with such other documents and instruments as the Dragging
Investor or its representative may reasonably request to evidence such Transfer.
5.1.4 Promptly (but no more than 5 business days) after the
completion of any transaction described in a Drag-Along Notice or, the
determination of the value of the consideration received in such transaction
pursuant to Section 4(b) of the certificates of designations relating to the
Preferred Stock, if other than cash or cash equivalents, whichever is earlier,
the Dragging Holder shall give notice thereof to the Dragged Holders, shall
remit to each of them the transaction proceeds to which it is entitled (to be
determined as set forth below) (other than any amounts that are required to be
withheld pursuant to applicable law or otherwise necessary to be withheld
pursuant to the agreement evidencing such Drag-Along Transaction) and shall
furnish such other evidence of the completion and time of completion of such
sale or other disposition and the terms and conditions thereof as any Dragged
Holder may reasonably request. For purposes of this Section 5, the Dragging
Holder's and each Dragged Holder's share of the total consideration paid by the
purchaser in respect of a Drag-Along Transaction, (x) if such transaction
involves a sale of shares of Stock, shall be determined and allocated as though
such total consideration were being distributed to such Original Holders (on a
per share basis) pursuant to a Liquidation Event (as such term is defined in
Section 4(a) of the certificates of designations relating to the Preferred
Stock) in accordance with Section 4 of the certificates of designations relating
to the Preferred Stock, and as though the shares sold in the Transfer pursuant
to this Section 5 were the only outstanding shares of the Company at the time of
such Liquidation Event or (y) if such transaction involves a sale of
substantially all of the assets of the Company, shall be determined and
allocated in accordance with the applicable provisions of the certificates of
designations relating to the Preferred Stock.
5.1.5 Each of the Dragging Holder and Dragged Holders shall bear
its pro-rata share (based upon the percentage of the total consideration such
holder is entitled in respect of the Drag-Along Transaction) of the costs of any
Transfer of shares pursuant to a transaction described in a Drag-Along Notice to
the extent such costs are incurred for the benefit of the Dragging Holder and
the Dragged Holders and are not otherwise paid by the Company or the acquiring
party, with the understanding that the Company shall pay such costs unless
prohibited from doing so by the terms of the transaction. Costs incurred by the
Dragging Holder and Dragged Holders on their own behalf shall not be considered
to be costs of the transaction hereunder.
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6. LEGEND. Each of the Investors agrees that one or more of the
following legends may be placed on the certificates of any shares of Series B
Preferred and Series C Preferred (and Common Stock issuable upon conversion
thereof) owned by them:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). THESE SECURITIES
HAVE BEEN ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO DISTRIBUTION OR
RESALE, AND MAY NOT BE SOLD OR OTHERWISE TRANSFERRED WITHOUT AN EFFECTIVE
REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER THE ACT OR THE AVAILABILITY
OF AN EXEMPTION FROM SUCH REGISTRATION REQUIREMENTS.
THE CORPORATION WILL FURNISH WITHOUT CHARGE TO EACH STOCKHOLDER WHO SO
REQUESTS THE POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE PARTICIPATING,
OPTIONAL, OR OTHER SPECIAL RIGHTS OF THE SECURITIES REPRESENTED BY THIS
CERTIFICATE AND THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH
PREFERENCES AND/OR RIGHTS.
THE SHARES REPRESENTENTED BY THE CERTIFICATE ARE SUBJECT TO THE RIGHTS AND
RESTRICTIONS CONTAINED IN THE INVESTORS' AGREEMENT DATED AS OF JUNE 17,
2003, AS SUCH AGREEMENT MAY BE AMENDED, SUPPLEMENTED, RESTATED OR OTHERWISE
MODIFIED FROM TIME TO TIME (A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF
THE CORPORATION).
7. MISCELLANEOUS.
7.1 AGREEMENT TO BE BOUND. Notwithstanding anything to the contrary
contained in this Agreement, no shares of Common Stock, Preferred Stock or
Converted Shares held by any Investor may be Transferred unless the transferee,
prior to such Transfer, agrees in writing, in form and substance reasonably
satisfactory to the Company, to be bound by the terms of this Agreement to the
same extent and in the same manner as the transferor of such shares, a copy of
which writing shall be maintained on file with the Secretary of the Company and
shall include the address of such transferee to which notices hereunder shall be
sent. Any such transferee shall be entitled to exercise all of the rights of an
Investor as if an original party hereto.
7.2 TERM OF AGREEMENT.
7.2.1 This Agreement shall automatically terminate on the
occurrence of any of the following events: (i) the cessation of the Company's
business or the complete liquidation of the Company; (ii) whenever one holder
owns all of the shares of Stock; and (iii) upon a Qualified Public Offering.
7.2.2 In addition, this Agreement shall terminate and be of no
further force or effect (i) with respect to any Investor when such Investor
ceases to own any Stock or (ii) by written consent in accordance with SECTION
7.5 hereof.
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7.3 RECAPITALIZATION, ETC. In the event that any Stock or other
securities of the Company are issued in respect of, in exchange for, or in
substitution of, any Common Stock or Preferred Stock by reason of any
reorganization, recapitalization, reclassification, merger, consolidation,
spin-off, partial or complete liquidation, stock dividend, split-up, sale of
assets, distribution to stockholders or combination of the Common Stock and
Preferred Stock or any other change in capital structure of the Company,
appropriate adjustments shall be made with respect to the relevant provisions of
this Agreement so as to fairly and equitably preserve, as far as practicable,
the original rights and obligations of the parties hereto under this Agreement.
7.4 NOTICES. All notices required to be given to any of the parties
to this Agreement shall be in writing and shall be deemed to have been
sufficiently given, subject to the further provisions of this Section, for all
purposes (and shall constitute valid legal service) when presented personally to
such party or sent by certified or registered mail, return receipt requested,
with proper postage prepaid, or any national overnight delivery service, with
proper charges prepaid, or by facsimile (together with an electronically
generated confirmation of receipt) to such party at its address set forth below:
If to the Company:
United Road Services, Inc.
00000 Xxxxxxxxxx Xxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxxx
Telecopy: (000) 000-0000
With a copy to:
Proskauer Rose LLP
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxx X. Xxxxx, Esq.
Facsimile: 000-000-0000
If to Blue Truck:
Blue Truck Acquisition, LLC
c/o KPS Special Situations Fund, L.P.
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx Xxxxxxx, Esq.
Telecopy: (000) 000-0000
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With a copy to:
Xxxx, Weiss, Rifkind, Xxxxxxx & Xxxxxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attn: Xxxx X. Xxxxxxx, Esq.
Facsimile: (000) 000-0000
If to CFE:
c/o General Electric Capital Corporation
000 Xxxxxxxxxxx Xxxxxx
Xxx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxxx
Facsimile: (000) 000-0000
With a copy to:
Winston & Xxxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx Xxxxxx, Esq.
Facsimile: (000) 000-0000
If to Charter:
c/o Charterhouse Group International, Inc.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxx Xxxxxx
Facsimile: (000) 000-0000
with copy to:
Proskauer Rose LLP
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxx X. Xxxxx, Esq.
Facsimile: 000-000-0000
If to Xxxxxxx:
Xxxxxxx X. Xxxxxxx
00000 Xxxxxxxxxx Xxxx
Xxxxxxx, XX 00000
Facsimile: (000) 000-0000
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Such notice shall be deemed to be received when delivered if delivered
personally, the next business day after the date sent if sent by a national
overnight delivery service, three (3) business days after the date mailed if
mailed by certified or registered mail, or when received if sent by facsimile.
Any party may change its address for purposes of this Agreement, and notice of
any change in such address shall also be given in the manner set forth above.
Whenever the giving of notice is required, the giving of such notice may be
waived in writing by the party entitled to receive such notice.
7.5 AMENDMENT AND WAIVER.
7.5.1 No failure or delay on the part of any party hereto in
exercising any right, power or remedy hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right, power or
remedy preclude any other or further exercise thereof or the exercise of any
other right, power or remedy. The remedies provided for herein are cumulative
and are not exclusive of any remedies that may be available to the parties
hereto at law, in equity or otherwise.
7.5.2 Any amendment, supplement or modification of or to any
provision of this Agreement, any waiver of any provision of this Agreement, and
any consent to any departure by any party from the terms of any provision of
this Agreement, shall be effective only if it is made or given in writing and
signed by (i) the affected party(ies), (ii) Charter, and (iii) Blue Truck, for
so long as Blue Truck continues to own at least 50% of the Adjusted Number of
Shares Purchased (as defined in the certificate of designations relating to the
Series B Preferred).
7.6 SPECIFIC PERFORMANCE. The parties hereto agree that (a)
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached, and (b) each of the parties has the right to seek damages or
specific performance in the event that any other party hereto willfully fails to
perform such party's obligations hereunder. Therefore, if any party shall
institute any action or proceeding to enforce the provisions hereof, any party
against whom such action or proceeding is brought hereby waives any claim or
defense therein that the plaintiff party has an adequate remedy at law.
7.7 HEADINGS. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof.
7.8 SEVERABILITY. If any one or more of the provisions contained
herein, or the application thereof in any circumstance, is held invalid, illegal
or unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions hereof shall not be in any way impaired, unless the provisions held
invalid, illegal or unenforceable shall substantially impair the benefits of the
remaining provisions hereof.
7.9 ENTIRE AGREEMENT. This Agreement and the Ancillary Agreements are
intended by the parties as a final expression of their agreement and intended to
be a complete and exclusive statement of the agreements and understandings of
the parties hereto in respect of the
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subject matter contained herein and therein. There are no restrictions,
promises, warranties or undertakings, other than those set forth or referred to
herein and in the Ancillary Agreements. This Agreement and the Ancillary
Agreements supersede all prior agreements and understandings between the parties
with respect to such subject matter, including, but not limited to, the
Investors' Agreement, dated as of June 20, 2000, between the Company and Blue
Truck, the Amended and Restated Investors' Rights Agreement, dated as of April
14, 2000, between the Company and Charter, and the Tag-Along Side Letter, dated
as of June 20, 2000, between Blue Truck and CFE.
7.10 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO SUCH
STATE'S PRINCIPLES REGARDING CONFLICTS OF LAW.
7.11 FURTHER ASSURANCES. Each of the parties shall, and shall cause
its respective Affiliates to, execute such instruments and take such action as
may be reasonably required or desirable to carry out the provisions hereof and
the transactions contemplated hereby.
7.12 SUCCESSORS AND ASSIGNS. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective permitted successors
and assigns. This Agreement is not assignable by the Company and may be assigned
by any Investor to any Permitted Transferee.
7.13 NO THIRD PARTY BENEFICIARIES. Except for Section 2.3, this
Agreement is not intended to, and does not, create any rights or benefits of any
Person other than the parties hereto.
7.14 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, and all of which taken
together shall constitute one and the same instrument.
7.15 JURISDICTION. Each party hereby irrevocably submits to the
exclusive jurisdiction of the courts of the State of New York and the federal
courts of the United States of America located in such state solely in respect
of any claim relating to the interpretation and enforcement of the provisions of
this Agreement, or otherwise in respect of the transactions contemplated hereby
and thereby, and hereby waives, and agrees not to assert, as a defense in any
action, suit or proceeding in which any such claim is made that it is not
subject thereto or that such action, suit or proceeding may not be brought or is
not maintainable in such courts or that the venue thereof may not be appropriate
or that this Agreement or any such document may not be enforced in or by such
courts, including with respect to notice of claim provided that such notice is
given pursuant of Section 7.4 hereof.
7.16 WAIVER OF JURY TRIAL. Each party acknowledges and agrees that
any controversy which may arise under this Agreement is likely to involve
complicated and difficult issues, and therefore each party hereby irrevocably
and unconditionally waives any right such party may have to a trial by jury.
Each party certifies and acknowledges that (i) no representative, agent or
attorney of any other party has represented, expressly or otherwise, that
14
such other party would not, in the event of litigation, seek to enforce the
foregoing waiver, (ii) such party understands and has considered the
implications of this waiver, (iii) such party makes this waiver voluntarily, and
(iv) such party has been induced to enter into this Agreement by, among other
things, the mutual waivers, agreements and certifications in this section.
7.17 EFFECTIVENESS. Notwithstanding anything to the contrary
contained in this Agreement, this Agreement shall not become effective, and the
Original Holders shall have no rights hereunder, unless and until the Closing
has occurred.
[Signature Page Follows]
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IN WITNESS WHEREOF, the undersigned have executed, or have caused
to be executed, this Agreement on the date first written above.
UNITED ROAD SERVICES, INC.
By:
------------------------------
Name:
Title:
BLUE TRUCK ACQUISITION, LLC
By:
By:
------------------------------
Name:
Title:
GE CAPITAL CFE, INC. (formerly, CFE, Inc.)
By:
------------------------------
Name:
Title:
CHARTER URS LLC
By:
------------------------------
Name:
Title:
---------------------------------
Xxxxxxx Xxxxxxx
SCHEDULE A
Xx Xxxxxxxx
A. Xxxxxxxx Xxxxx
Xxxxxxx Xxxxxx
Xxxxx Xxxxxxx
Xxxxxx X. Xxxxx
Xxxxxx Xxxxxx
Xxxxx Xxxxx
Xxxxxxx Xxxxxxx
Xxxxxxx Xxxxxx
17
SCHEDULE B
Blue Truck designee: Xxxxxx xxx Xxxx
Charter designee: Xxxxxx X. Xxxxxxx
Charter designee: Xxxx Xxxxxx
Charter designee: Xxxxx Silver
18
