1
Exhibit 10.24
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (the "Agreement"), dated as of
June 24, 1998 is made and entered into by Gildan Activewear Inc., a Canadian
corporation (the "Company"), Harco Holdings Ltd., a Canadian corporation
("Harco"), Le Fonds de Solidarite des Travailleurs du Quebec (FTQ), a Canadian
corporation (the "Fund"), Royal Bank of Canada Financial Corporation, acting as
trustee for the H. Xxxxxxx Xxxxxxxx Family Trust ("the Xxxx Trust"), Royal Bank
of Canada Financial Corporation, acting as trustee for the Xxxxx Xxxxxxxx Family
Trust (the "Xxxxx Trust"), Royal Bank of Canada Financial Corporation, acting as
trustee for the Xxxxxxx Xxxxxxxx Family Trust (the "Xxxxxxx Trust") and Royal
Bank of Canada Financial Corporation, acting as trustee for the Tisch Family
Trust (the "Benni Trust"), each a trust established and existing under the laws
of Barbados (together, the "Trusts").
In consideration of the mutual covenants herein contained and other
good and valuable consideration, receipt of which is hereby acknowledged, the
parties hereto do hereby agree as follows:
1. Background. Harco currently owns an aggregate of 3,047,000 shares
of the Company's Class B Subordinate Voting Shares, without par value (the
"Class B Shares"); the Fund currently owns an aggregate of 1,939,000 shares of
the Company's Class A Subordinate Voting Shares, without par value (the "Class A
Shares"); the Xxxx Trust currently owns an aggregate of 856,300 Class A Shares;
the Xxxxx Trust currently owns an aggregate of 856,300 Class A Shares; the
Xxxxxxx Trust currently owns an aggregate of 196,400 Class A Shares; the Benni
Trust currently owns an aggregate of 55,000 Class A Shares.
2. Definitions. As used in this Agreement, the following capitalized
terms shall have the following respective meanings:
Exchange Act - The Securities Exchange Act of 1934, as amended.
Holder - Harco, the Fund, the Trusts or any holder of Registrable
Securities who agrees in writing to be bound by the provisions of this
Agreement.
Person - Any individual, partnership, joint venture, corporation,
trust, unincorporated organization or government or any department or
agency thereof.
Registrable Securities - Any Class A Shares issued or issuable to
Harco, the Fund and the Trusts and any Class A Shares which may be issued
or distributed in respect of such Class A Shares by way of stock dividend
or stock split or other distribution, recapitalization or
reclassification. As to any particular Registrable Securities, once issued
such Securities shall cease to be Registrable Securities when (i) a
registration statement with respect to the sale of such Securities shall
have become
2
2
effective under the Securities Act and such Securities shall have been
disposed of in accordance with such registration statement, (ii) they
shall have been distributed to the public pursuant to Rule 144 or 144A (or
any successor provisions) under the Securities Act, (iii) they shall have
been otherwise transferred, new certificates for them not bearing a legend
restricting further transfer shall have been delivered by the Company and
subsequent disposition of them shall not require registration or
qualification of them under the Securities Act or any state securities or
blue sky law then in force, or (iv) they shall have been repurchased or
redeemed by the Company or have otherwise ceased to be outstanding.
Registration Expenses - Any and all expenses incident the
performance of or compliance with this Agreement, including, without
limitation, (i) all SEC and stock exchange or National Association of
Securities Dealers, Inc. registration and filing fees, (ii) all fees and
expenses of complying with securities or blue sky laws (including fees and
disbursements of counsel for the underwriters in connection with blue sky
qualifications of the Registrable Securities), (iii) all printing,
messenger and delivery expenses, (iv) all fees and expenses incurred in
connection with the listing of the Registrable Securities on any
securities exchange pursuant to clause (viii) of Section 5, (v) the fees
and disbursements of counsel for the Company and of its independent public
accountants, including the expenses of any special audits and/or "cold
comfort" letters required by or incident to such performance and
compliance, (vi) the reasonable fees and disbursements of one counsel
selected by the Holder of a majority of the Registrable Securities being
registered to represent all Holders of the Registrable Securities being
registered in connection with each such registration, and (vii) any fees
and disbursements of underwriters customarily paid by the issuers or
sellers of securities, including liability insurance if the Company so
desires or if the underwriters so require, and the reasonable fees and
expenses of any special experts retained in connection with the requested
registration, but excluding underwriting discounts and commissions and
transfer taxes, if any.
Securities Act - The Securities Act of 1933, as amended.
SEC - The Securities and Exchange Commission or any other federal
agency at the time administering the Securities Act or the Exchange Act.
3. Incidental Registrations.
(a) Right to Include Registrable Securities. If the Company at any
time after the date hereof proposes to register its Class A Shares under the
Securities Act (other than a registration on Form F-4 or S-8, or any successor
or other forms promulgated for similar purposes), whether or not for sale for
its own account, pursuant to a registration statement on which it is permissible
to register Registrable Securities for sale to the public under the Securities
Act, it will at such time give prompt written notice to all Holders of
Registrable Securities of its intention to do so and of such Holders' rights
under this Section 3, at least 30 days prior to the anticipated date of the
initial filing of the registration statement relating to such registration. Upon
the written request of any such Holder made within 15 days after the
3
3
receipt of any such notice (which request shall specify the Registrable
Securities intended to be disposed of by such Holder), the Company will use its
best efforts to effect the registration under the Securities Act of all
Registrable Securities which the Company has been so requested to register by
the Holders thereof provided, that (i) if, at any time after giving written
notice of its intention to register any securities and prior to the effective
date of the registration statement filed in connection with such registration,
the Company shall determine for any reason not to proceed with the proposed
registration of the securities to be sold by it, the Company may, at its
election, give written notice of such determination to each Holder of
Registrable Securities and, thereupon, shall be relieved of its obligation to
register any Registrable Securities in connection with such registration (but
not from its obligation to pay the Registration Expenses in connection
therewith, and (ii) if such registration involves an underwritten offering, all
Holders of Registrable Securities requesting to be included in the Company's
registration must sell their Registrable Securities to the underwriters selected
by the Company on the same terms and conditions as apply to the Company, with
such differences, including any with respect to indemnification and liability
insurance, as may be customary or appropriate in combined primary and secondary
offerings.
(b) Expenses. The Company will pay all Registration Expenses in
connection with each registration of Registrable Securities requested pursuant
to this Section 3.
(c) Priority in Incidental Registrations. If a registration pursuant
to this Section 3 involves an underwritten offering and the managing underwriter
advises the Company in writing that, in its opinion, the amount of securities
requested to be included in such registration exceeds the amount which can be
sold in such offering, so as to be likely to have an adverse effect on such
offering as contemplated by the Company (including the price at which the
Company initially proposes to sell such securities), then the Company will
include in such registration (i) first, 100% of the securities the Company
proposes to sell for its own account or for the account of a demanding
shareholder pursuant to a demand registration right granted under Section 4,
(ii) second, to the extent of the amount of Registrable Securities requested to
be included in such registration which, in the opinion of such managing
underwriter, can be sold without having the adverse effect referred to above,
the amount of Registrable Securities which the Holders have requested to be
included in such registration, such amount to be allocated pro rata among all
requesting Holders on the basis of the relative number of shares of Registrable
Securities then held by each such Holder (provided that any Registrable
Securities thereby allocated to any such Holder that exceed such Holder's
request will be reallocated among the remaining requesting Holders in like
manner).
4. Registration on Request.
(a) Request by Holders. After any Class A Shares of the Company have
been registered after the date hereof under the Securities Act (other than a
registration on Form F-4 or S-8, or any successor or other forms promulgated for
similar purposes), upon the written request of any Holder or Holders requesting
that the Company effect a registration under the Securities Act of all or part
of such Holder's or Holders' Registrable Securities and specifying the intended
method of disposition thereof, the Company will promptly give written notice of
4
4
such requested registration to all other Holders of Registrable Securities, and
thereupon will, as expeditiously as possible, use its best efforts to effect the
registration under the Securities Act, of:
(i) the Registrable Securities which the Company has been so
requested to register by such Holder or Holders; and
(ii) all other Registrable Securities which the Company has been
requested to register by any other Holder thereof by written request given
to the Company within 15 days after the giving of such written notice by
the Company (which request shall specify the intended method of
disposition of such Registrable Securities),
so as to permit the disposition (in accordance with the intended method thereof
as aforesaid) of the Registrable Securities so to be registered; provided, that,
the Company shall not be obligated to file a registration statement relating to
any registration request under this Section 4(a) (i) if the aggregate requests
by the Holder or Holders for such registration do not cover at least 5% of the
number of Registrable Securities then outstanding, (ii) if a period of one year
has not elapsed since the date that the SEC has declared effective (x) the
registration statement last requested by any Holder pursuant to this Section
4(a) or (y) any registration statement effected under Section 3 hereof or (iii)
if with respect thereto, the managing underwriter, the SEC, the Securities Act
or the rules and regulations thereunder, or the form on which the registration
statement is to be filed, would require the conduct of an audit other than to
regular audit conducted by the Company at the end of its fiscal year, in which
case the filing may be delayed until the completion of such regular audit
(unless the Holders of the Registrable Securities to be registered agree to pay
the expenses of the Company in connection with such an audit other than the
regular audit).
(b) Registration Statement Form. If any registration requested
pursuant to this Section 4 which is proposed by the Company to be effected by
the filing of a registration statement on Form F-3 (or any successor or similar
short-form registration statement) shall be in connection with an underwritten
public offering, and if the managing underwriter shall advise the Company in
writing that, in its opinion, the use of another form of registration statement
is of material importance to the success of such proposed offering, then such
registration shall be effected on such other form.
(c) Expenses. The Company will pay all Registration Expenses in
connection with the first five registrations of Registrable Securities pursuant
to this Section 4 upon the written request of any of the Holders. All expenses
for any subsequent registrations of Registrable Securities pursuant to this
Section 4 shall be paid pro rata by the Company and all other Persons (including
the Holders) participating in such registration on the basis of the relative
number of Class A Shares of each such Person included in such registration.
(d) Effective Registration Statement. A registration requested
pursuant to this Section 4 will not be deemed to have been effected unless it
has become effective; provided, that if, within 180 days after it has become
effective, the offering of Registrable Securities pursuant to such registration
is interfered with by any stop order, injunction or other order or
5
5
requirement of the SEC or other governmental agency or court, such registration
will be deemed not to have been effected.
(e) Selection of Underwriters. If a requested registration pursuant
to this Section 4 involves an underwritten offering, the Company shall have the
right to select the investment banker or bankers and managers to administer the
offering; provided, however, that such investment banker or bankers and managers
shall be satisfactory to holders of a majority of the Registrable Securities
which are held by Holders and which the Company has been requested to register.
(f) Priority in Requested Registrations. If a requested registration
pursuant to this Section 4 involves an underwritten offering and the managing
underwriter advises the Company in writing that, in its opinion, the number of
securities requested to be included in such registration (including securities
of the Company which are not Registrable Securities) exceeds the number which
can be sold in such offering, the Company will include in such registration only
the Registrable Securities requested to be included in such registration. In the
event that the number of Registrable Securities requested to be included in such
registration exceeds the number which, in the opinion of such managing
underwriter, can be sold, the number of such Registrable Securities to be
included in such registration shall be allocated pro rata among all requesting
Holders on the basis of the relative number of shares of Registrable Securities
then held by each such Holder (provided that any shares thereby allocated to any
such Holder that exceed such Holder's request shall be reallocated among the
remaining requesting Holders in like manner). In the event that the number of
Registrable Securities requested to be included in such registration is less
than the number which, in the opinion of the managing underwriter, can be sold,
the Company may include in such registration the securities the Company proposes
to sell up to the number of securities that, in the opinion of the underwriter,
can be sold.
(g) Additional Rights. If the Company at any time grants to any
other holders of Class A Shares any rights to request the Company to effect the
registration under the Securities Act of any such Class A Shares on terms more
favorable to such holders than to terms set forth in this Section 4, the terms
of this Section 4 shall be deemed amended or supplemented to the extent
necessary to provide the Holders such more favorable rights and benefits.
(h) Other Registrations. The Company shall not effect any
registration of its Securities (except on Form S-8, F-4 or any successor forms
to such Forms), or effect any public or private sale or distribution of any of
its Securities, including a sale pursuant to Regulation D under the Securities
Act, whether on its own behalf or at the request of any Holder or Holders of
such Securities (other than pursuant to and in accordance with this Section 4),
from the date of a registration on request to register Registrable Securities
pursuant to and in accordance with Section 4(a) until to earlier of (i) 90 days
after the date on which all securities covered by such registration statement
have been sold or (ii) 180 days after the effectiveness date of such
registration statement unless the Company shall have first notified in writing
the selling stockholders of the Registrable Securities covered by such
registration statement of its intention to do so, and a majority in interest of
such selling
6
6
stockholders and, if applicable, the managing Underwriter, shall have consented
thereto in writing; provided, however, that in the event of any conflict between
the provisions of clause (ii) of this paragraph (h) and to lock-up provisions
contained in any underwriting agreement which has been entered into in
connection with a registered underwritten offering, the provisions of such
underwriting agreement shall be controlling.
(i) Postponement and Suspension of Registration. Notwithstanding
anything to the contrary contained herein, the Company may postpone for up to
sixty (60) days the filing or the effectiveness of a registration statement
under Section 4(a) or may suspend the right to transfer securities which are the
subject of an effective registration statement under Section 4(a) if a majority
of the Board of Directors, including a majority of independent directors, has in
good faith determined, and has delivered to the Holders a written certification
to the effect that, (i) the Company is intending to currently consummate, and
has a reasonable likelihood of currently consummating, a material corporate
transaction outside of the ordinary course of business (any such transaction, a
"Significant Corporate Transaction") that would, in the written opinion of
outside counsel, require additional disclosure regarding such Significant
Corporate Transaction in the applicable registration statement in order for
sales of securities pursuant to such registration statement to not be in
violation of applicable securities laws, (ii) failure to engage in such
Significant Corporate Transaction at such time would be materially adverse to
the Company and (iii) no disclosure could be made in the applicable registration
statement regarding such Significant Corporate Transaction that would not be
materially adverse to the Company; provided, however, that no such postponement
or suspension shall be imposed unless at least four (4) months have expired
since the termination of any prior such postponement or suspension pursuant to
this Section 4(i).
5. Registration Procedures. If and whenever the Company is required
to use its best efforts to effect or cause the registration of any Registrable
Securities under the Securities Act as provided in this Agreement, the Company
will, as expeditiously as possible:
(i) prepare and, in any event within 120 days after the end of the
period within which a request for registration may be given to the
Company, file with the SEC a registration statement with respect to such
Registrable Securities and use its best efforts to cause such registration
statement to become effective; provided, however, that the Company may
discontinue any registration of its securities which is being effected
pursuant to Section 3 at any time prior to the effective date of the
registration statement relating thereto;
(ii) prepare and file with the SEC such amendments and supplements
to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement
effective for a period not in excess of 180 days and to comply with the
provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement during such period in
accordance with the intended methods of disposition by the seller or
sellers thereof set forth in such registration statement; provided, that
before filing a registration statement or prospectus, or any amendments or
supplements thereto, the Company will furnish to one counsel selected by
the Holders of a majority of the Registrable
7
7
Securities covered by such registration statement to represent all Holders
of Registrable Securities covered by such registration statement, copies
of all documents proposed to be filed, which documents will be subject to
the review of such counsel;
(iii) furnish to each seller of such Registrable Securities such
number of copies of such registration statement and of each amendment and
supplement thereto (in each case including all exhibits), such number of
copies of the prospectus included in such registration statement
(including each preliminary prospectus and summary prospectus), in
conformity with the requirements of the Securities Act, and such other
documents as such seller may reasonably request in order to facilitate the
disposition of the Registrable Securities by such seller;
(iv) use its best efforts to register or qualify such Registrable
Securities covered by such registration statement under such other
securities or blue sky laws of such jurisdictions as each seller shall
reasonably request, and do any and all other acts and things which may be
reasonably necessary or advisable to enable such seller to consummate the
disposition in such jurisdictions of the Registrable Securities owned by
such seller, except that the Company shall not for any such purpose be
required to qualify generally to do business as a foreign corporation in
any jurisdiction where, but for the requirements of this clause (iv), it
would not be obligated to be so qualified, to subject itself to taxation
in any such jurisdiction, or to consent to general service of process in
any such jurisdiction;
(v) use its best efforts to cause such Registrable Securities
covered by such registration statement to be registered with or approved
by such other governmental agencies or authorities as may be necessary to
enable the seller or sellers thereof to consummate the disposition of such
Registrable Securities;
(vi) notify each seller of any such Registrable Securities covered
by such registration statement, at any time when a prospectus relating
thereto is required to be delivered under the Securities Act within the
appropriate period mentioned in clause (ii) of this Section 5, of the
Company's becoming aware that the prospectus included in such registration
statement, as then in effect, includes an untrue statement of a material
fact or omits to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in the light of
the circumstances then existing, and at the request of any such seller,
prepare and furnish to such seller a reasonable number of copies of an
amended or supplemental prospectus as may be necessary so that, as
thereafter delivered to the purchasers of such Registrable Securities,
such prospectus shall not include an untrue statement of a material fact
or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in the light of
the circumstances then existing;
(vii) otherwise use its best efforts to comply with all applicable
rules and regulations of the SEC, and make available to its security
holders, as soon as reasonably practicable (but not more than eighteen
months) after the effective date of the registration statement, an
earnings statement which shall satisfy the provisions of
8
8
Section 11(a) of the Securities Act and to rules and regulations
promulgated thereunder;
(viii) use its best efforts to list such Registrable Securities on
any securities exchange or automated quotation system on which the
Ordinary Shares are then listed, if such Registrable Securities are not
already so listed and if such listing is then permitted under the rules of
such exchange, and to provide a transfer agent and registrar for such
Registrable Securities covered by such registration statement not later
than the effective date of such registration statement;
(ix) enter into such customary agreements (including an underwriting
agreement in customary form) and take such other actions as sellers of a
majority of such Registrable Securities or the underwriters, if any,
reasonably request in order to expedite or facilitate the disposition of
such Registrable Securities;
(x) obtain a "cold comfort" letter or letters from the Company's
independent public accountants in customary form and covering matters of
the type customarily covered by "cold comfort" letters as the seller or
sellers of a majority of such Registrable Securities shall reasonably
request (provided that Registrable Securities constitute at least 25% of
the Securities covered by such registration statement); and
(xi) make available for inspection by any seller of such Registrable
Securities covered by such registration statement, by any underwriter
participating in any disposition to be effected pursuant to such
registration statement and by any attorney, accountant or other agent
retained by any such seller or any such underwriter, all pertinent
financial and other records, pertinent corporate documents and properties
of the Company, and cause all of the Company's officers, directors and
employees to supply all information reasonably requested by any such
seller, underwriter, attorney, accountant or agent in connection with such
registration statement.
The Company may require each seller of Registrable Securities as to
which any registration is being effected to furnish the Company with such
information regarding such seller and pertinent to the disclosure requirements
relating to the registration and the distribution of such securities as the
Company may from time to time reasonably request in writing.
Each Holder of Registrable Securities agrees that, upon receipt of
any notice from the Company of the happening of any event of the kind described
in clause (vi) of this Section 5, such Holder will forthwith discontinue
disposition of Registrable Securities pursuant to the registration statement
covering such Registrable Securities until such Holder's receipt of the copies
of the supplemented or amended prospectus contemplated by clause (vi) of this
Section 5, and, if so directed by the Company, such Holder will deliver to the
Company (at the Company's expense) all copies, other than permanent file copies
then in such Holder's possession, of the prospectus covering such Registrable
Securities current at the
9
9
time of receipt of such notice. In the event the Company shall give any such
notice, the period mentioned in clause (ii) of this Section 5 shall be extended
by the number of days during the period from and including the date of the
giving of such notice pursuant to clause (vi) of this Section 5 and including
the date when each seller of Registrable Securities covered by such registration
statement shall have received the copies of the supplemented or amended
prospectus contemplated by clause (vi) of this Section 5.
6. Indemnification.
(a) Indemnification by the Company. In the event of any registration
of any securities of the Company under the Securities Act pursuant to Section 3
or 4, the Company will, and it hereby does, indemnify and hold harmless, to the
extent permitted by law, the seller of any Registrable Securities covered by
such registration statement, each affiliate of such seller and their respective
directors and officers (and the directors, officers, affiliates and controlling
Persons thereof), each other Person who participates as an underwriter in the
offering or sale of such securities and each other Person, if any, who controls
such seller or any such underwriter within the meaning of the Securities Act
(collectively, the "Indemnified Parties"), against any and all losses, claims,
damages or liabilities, joint or several, and expenses to which such seller, any
such director or officer or affiliate or any such underwriter or controlling
Person may become subject under the Securities Act, common law or otherwise,
insofar as such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof, whether or not such Indemnified Party is a party
thereto) arise out of or are based upon (a) any untrue statement or alleged
untrue statement of any material fact contained in any registration statement
under which such securities were registered under the Securities Act, any
preliminary, final or summary prospectus contained therein, or any amendment or
supplement thereto, or (b) any omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading in the light of to circumstances then existing, and the
Company will reimburse such Indemnified Party for any legal or any other
expenses reasonably incurred by it in connection with investigating or defending
any such loss, claim, liability, action or proceeding; provided, that the
Company shall not be liable to any Indemnified Party in any such case to the
extent that any such loss, claim, damage, liability (or action or proceeding in
respect thereof) or expense arises out of or is based upon any untrue statement
or alleged untrue statement or omission or alleged omission made in such
registration statement or amendment or supplement thereto or in any such
preliminary, final or summary prospectus in reliance upon and in conformity with
written information with respect to such seller furnished to the Company by such
seller for use in the preparation thereof and provided, further, that the
Company will not be liable to any Person who participates as an underwriter in
the offering or sale of Registrable Securities or any other Person, if any, who
controls such underwriter within the meaning of the Securities Act, under the
indemnity agreement in this Section 6(a) with respect to any preliminary
prospectus or the final prospectus or the final prospects as amended or
supplemented, as the case may be, to the extent that any such loss, claim,
damage or liability of such underwriter or controlling Person results from the
fact that such underwriter sold Registrable Securities to a person to whom there
was not sent or given, at or prior to the written confirmation of such sale, a
copy of the final prospectus (including any documents incorporated by reference
therein) or of the final prospectus as then amended
10
10
or supplemented (including any documents incorporated by reference therein),
whichever is most recent, if the Company has previously furnished copies thereof
to such underwriter. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of such seller or any
Indemnified Party and shall survive the transfer of such securities by such
seller.
(b) Indemnification by the Seller. The Company may require, as a
condition to including any Registrable Securities in any registration statement
filed in accordance with Section 5 herein, that the Company shall have received
an undertaking reasonably satisfactory to it from to prospective seller of such
Registrable Securities or any underwriter to indemnify and hold harmless (in the
same manner and to the same extent as set fort in subdivision (a) of this
Section 6) the Company and all other prospective sellers or any underwriter, as
the case may be, with respect to any statement or alleged statement in or
omission or alleged omission from such registration statement, any preliminary,
final or summary prospects contained therein, or any amendment or supplement, if
such statement or alleged statement or omission or alleged omission was made in
reliance upon and in conformity with written information with respect to such
seller or underwriter furnished to the Company by such seller or underwriter for
use in the preparation of such registration statement, preliminary, final or
summary prospects or amendment or supplement, or a document incorporated by
reference into any of the foregoing. Such indemnity shall remain in full force
and effect regardless of any investigation made by or on behalf of the Company
or any of the prospective sellers, or any of their respective affiliates,
directors, officers or controlling Persons and shall survive the transfer of
such securities by such seller.
(c) Notices of Claims, Etc. Promptly after receipt by an indemnified
party hereunder of written notice of to commencement of any action or proceeding
with respect to which a claim for indemnification may be made pursuant to this
Section 6, such indemnified party will, if a claim in respect thereof is to be
made against an indemnifying party, give written notice to the latter of the
commencement of such action; provided, that the failure of the indemnified party
to give notice as provided herein shall not relieve the indemnifying party of
its obligations under the preceding subdivisions of this Section 6, except to
the extent that the indemnifying party is actually prejudiced by such failure to
give notice. In case any such action is brought against an indemnified party,
unless in such indemnified party's reasonable judgment a conflict of interest
between such indemnified and indemnifying parties may exist in respect of such
claim, the indemnifying party will be entitled to participate in and to assume
the defense thereof, jointly with any other indemnifying party similarly
notified to the extent that it may wish, with counsel reasonably satisfactory to
such indemnified party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party will not be liable to such indemnified party for any legal or
other expenses subsequently incurred by the latter in connection with the
defense thereof other than reasonable costs of investigation. No indemnifying
party will consent to entry of any judgment or enter into any settlement which
does not include as an unconditional term thereof, the giving by the claimant or
plaintiff to such indemnified party of a release from all liability in respect
to such claim or litigation.
11
11
(d) Other Indemnification. Indemnification similar to that specified
in the preceding subdivisions of this Section 6 (with appropriate modifications)
shall be given by the Company and each seller of Registrable Securities with
respect to any required registration or other qualification of securities under
any federal or state law or regulation or governmental authority other than the
Securities Act.
(e) Non-Exclusivity. The obligations of the parties under this
Section 6 shall be in addition to any liability which any party may otherwise
have to any other party.
7. Rule 144. If the Company shall have filed a registration
statement pursuant to the requirements of Section 12 of the Exchange Act or a
registration statement pursuant to the requirements of the Securities Act, the
Company covenants that it will file the reports required to be filed by it under
the Securities Act and the Exchange Act and the rules and regulations adopted by
the SEC thereunder (or, if to Company is not required to file such reports, it
will, upon the request of any Holder of Registrable Securities, make publicly
available such information), and it will take such further action as any Holder
of Registrable Securities may reasonably request, all to the extent required
from time to time to enable such Holder to sell shares of Registrable Securities
without registration under the Securities Act within the limitation of the
exemptions provided by (i) Rule 144 under the Securities Act, as such Rule may
be amended from time to time, or (ii) any similar rule or regulation hereafter
adopted by the SEC. Upon the request of any Holder of Registrable Securities,
the Company will deliver to such Holder a written statement as to whether it has
complied with such requirements. Notwithstanding anything contained in this
Section 7, the Company may deregister under Section 12 of the Exchange Act if it
then is permitted to do so pursuant to the Exchange Act and the rules and
regulations thereunder.
8. Miscellaneous.
(a) Other Investors. The Company may enter into agreements with
other purchasers of Class A Shares who are then employees of the Company or any
of its subsidiaries making them parties hereto (and thereby giving them all of
the rights, preferences and privileges of an original party (other than the
Company) hereto) with respect to additional Class A Shares (the "Supplemental
Agreements"); provided that, pursuant to any such Supplemental Agreement, such
purchaser expressly agrees to be bound by all of the terms, conditions and
obligations of this Agreement as if such purchaser were an original party (other
than the Company) hereto; and further provided that such purchaser shall not
obtain any right to request registration under Section 4 hereof. All Class A
Shares issued or issuable pursuant to such Supplemental Agreements by such
purchasers shall be deemed to be Registrable Securities.
(b) Holdback Agreement. If any such registration shall be in
connection with an underwritten public offering, each Holder of Registrable
Securities agrees not to effect any public sale or distribution, including any
sale pursuant to Rule 144 under the Securities Act, of any equity securities of
the Company, or of any security convertible into or exchangeable or exercisable
for any equity security of the Company (in each case, other than as part of such
underwritten public offering), within 7 days before or 90 days (or such lesser
period as
12
12
the managing underwriters may permit) after the effective date of such
registration, and the Company hereby also so agrees and agrees to cause each
other Holder of any equity security, or of any security convertible into or
exchangeable or exercisable for any equity security, of the Company purchased
from the Company (at any time other than in a public offering) to so agree.
(c) Amendments and Waivers. This Agreement may be amended and the
Company may take any action herein prohibited, or omit to perform any act herein
required to be performed by it, only if the Company shall have obtained the
written consent to such amendment, action or omission to act, of the Holders of
a majority of the Registrable Securities then outstanding; provided, however,
that no such amendment shall adversely effect the rights of any Holder of
Registrable Securities hereunder without such Holder's prior written consent.
Each Holder of any Registrable Securities at the time or thereafter outstanding
shall be bound by any consent authorized by this Section 8(c), whether or not
such Registrable Securities shall have been marked to indicate such consent.
(d) Successors, Assigns and Transferees. This Agreement shall be
binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns. In addition, and whether or not any express
assignment shall have been made, the provisions of this Agreement which are for
the benefit of the parties hereto other than the Company shall also be for the
benefit of and enforceable by any subsequent Holder of any Registrable
Securities, subject to the provisions contained herein.
(e) Notices. All notices and other communications provided for
hereunder shall be in writing and shall be sent by first class mail, telecopier
or hand delivery:
(i) if to the Company, to:
Gildan Activewear Inc.
000 Xxxxxx xx Xxxxxx
Xxxxx Xxxxxx-Xxxxxxx, XX
Xxxxxx X0X 0X0
Telecopy No. (000) 000-0000
Attention: H. Xxxx Xxxxxxxx, Chief Executive Officer and
President
With a copy to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Telecopy No. (000) 000-0000
Attention: Xxxx X. Xxxxxxxx, Esq.
13
13
(ii) if to Harco, to:
Harco Holdings Ltd.
000 Xxxxxx xx Xxxxxx
Xxxxx Xxxxxx-Xxxxxxx, XX
Xxxxxx X0X 0X0
Telecopy No. (000) 000-0000
Attention: H. Xxxx Xxxxxxxx
With a copy to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Telecopy No. (000) 000-0000
Attention: Xxxx X. Xxxxxxxx, Esq.
(iii) if to the Fund, to:
Le Fonds de Solidarite des Travailleurs
du Quebec (FTQ)
0000 Xxxxx Xxxxxx
Xxxxxxxx, XX
Xxxxxx X0X 0X0
Telecopy No. (000) 000-0000
Attention: Legal Services
and
Telecopy No. (000) 000-0000
Attention: Vice President, Investments
(iv) if to Xxxx Trust, to:
Royal Bank of Canada Financial Corporation
Royal Bank House
The Xxxxxxxx, St. Xxxxxxx
X.X. Xxx 00X
Xxxxxxxxxx, Xxxxxxxx
Telecopy No. (000) 000-0000
Attention: Mr. N.L. (Xxx) Xxxxx, Managing Director
14
14
(v) if to Xxxxx Trust, to:
Royal Bank of Canada Financial Corporation
Royal Bank House
The Xxxxxxxx, St. Xxxxxxx
X.X. Xxx 00X
Xxxxxxxxxx, Xxxxxxxx
Telecopy No. (000) 000-0000
Attention: Mr. N.L. (Xxx) Xxxxx, Managing Director
(vi) if to Xxxxxxx Trust, to:
Royal Bank of Canada Financial Corporation
Royal Bank House
The Xxxxxxxx, St. Xxxxxxx
X.X. Xxx 00X
Xxxxxxxxxx, Xxxxxxxx
Telecopy No. (000) 000-0000
Attention: Mr. N.L. (Xxx) Xxxxx, Managing Director
(vii) if to Benni Trust, to:
Royal Bank of Canada Financial Corporation
Royal Bank House
The Xxxxxxxx, St. Xxxxxxx
X.X. Xxx 00X
Xxxxxxxxxx, Xxxxxxxx
Telecopy No. (000) 000-0000
Attention: Mr. N.L. (Xxx) Xxxxx, Managing Director
(viii) if to any other holder of Registrable Securities, to the
address of such other holder as shown in the books and records
of the Company.
All such notices and communications shall be deemed to have been given or made
(1) when delivered by hand, (2) five business days after being deposited in the
mail, postage prepaid or (3) when telecopied, receipt acknowledged.
(f) Descriptive Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning of terms contained herein.
15
15
(g) Severability. In the event that any one or more of the
provisions, paragraphs, words, clauses, phases or sentences contained herein, or
the application thereof in any circumstances, is held invalid, illegal or
unenforceable in any respect for any reason, the validity, legality and
enforceability of any such provision, paragraph, word, clause, phrase or
sentence in every other respect and of the remaining provisions, paragraphs,
words, clauses, phrases or sentences hereof shall not be in any way impaired, it
being intended that all rights, powers and privileges of the parties hereto
shall be enforceable to the fullest extent permitted by law.
(h) Counterparts. This Agreement may be executed in two or more
counterparts, and by different parties on separate counterparts, each of which
shall be deemed an original, but all such counterparts shall together constitute
one and the same instrument, and it shall not be necessary in making proof of
this Agreement to produce or account for more than one such counterpart.
(i) Governing Law; Submission to Jurisdiction. This Agreement shall
be governed by and construed and enforced in accordance with the laws of the
State of New York applicable to contracts made and to be performed therein. The
parties to this Agreement hereby agree to submit to the jurisdiction of the
courts of the State of New York in any action or proceeding arising out of or
relating to this Agreement.
(j) Specific Performance. The parties hereto acknowledge and agree
that 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. Accordingly, it is agreed that they shall be entitled
to an injunction or injunctions to prevent breaches of the provisions of this
Agreement and to enforce specifically the terms and provisions hereof in any
court of competent jurisdiction in the United States or any state thereof, in
addition to any other remedy to which they may be entitled at law or equity.
16
16
IN WITNESS WHEREOF, each of the undersigned has executed this
Agreement or caused this Agreement to be executed on its behalf as of the date
first written above.
GILDAN ACTIVEWEAR INC.
By: /s/ H. Xxxx Xxxxxxxx
----------------------------
Title:
HARCO HOLDINGS INC.
By: /s/ H. Xxxx Xxxxxxxx
----------------------------
Title:
LE FONDS DE SOLIDARITE DES
TRAVAILLEURS DU QUEBEC (FTQ)
By: /s/ Xxxxxx Xxxxxxx
----------------------------
Title:
ROYAL BANK OF CANADA FINANCIAL
CORPORATION, in its capacity as trustee of
the H. Xxxxxxx Xxxxxxxx Family Trust
By: /s/ Xx Xxxxxxx
----------------------------
Title:
ROYAL BANK OF CANADA FINANCIAL
CORPORATION, in its capacity as trustee of
the Xxxxx Xxxxxxxx Family Trust
By: /s/ Xx Xxxxxxx
----------------------------
Title:
17
17
ROYAL BANK OF CANADA FINANCIAL
CORPORATION, in its capacity as trustee of
the Xxxxxxx Xxxxxxxx Family Trust
ROYAL BANK OF CANADA FINANCIAL CORPORATION
By: /s/ Xx Xxxxxxx
----------------------------
Title: Managing Director
ROYAL BANK OF CANADA FINANCIAL
CORPORATION, in its capacity as trustee of
the Xxxxx X. Xxxxx Family Trust
ROYAL BANK OF CANADA FINANCIAL CORPORATION
By: /s/ Xx Xxxxxxx
----------------------------
Title: Managing Director
