EXHIBIT 2.2
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Transfer, Registration Rights and Governance Agreement
by and among
United States Filter Corporation,
Western Farm & Cattle Company,
N.N. Investors, L.P.,
California Land & Cattle Company,
ST Ranch GenPar, Inc.,
and
FW Ranch Partners, L.P.
dated as of
September 17, 1997
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Transfer, Registration Rights and Governance Agreement
by and among
United States Filter Corporation,
Western Farm & Cattle Company,
N.N. Investors, L.P.,
California Land & Cattle Company,
ST Ranch GenPar, Inc.,
and
FW Ranch Partners, L.P.
dated as of
September 17, 1997
TABLE OF CONTENTS
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Page
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ARTICLE I DEFINITIONS................................................. 2
Section 1.1. Certain Definitions.................................... 2
ARTICLE II REPRESENTATIONS AND WARRANTIES.............................. 4
Section 2.1. Representations and Warranties of the Company.......... 4
Section 2.2. Representations and Warranties of Western
Farm & Cattle........................................ 4
Section 2.3. Representations and Warranties of N.N. Investors....... 5
Section 2.4. Representations and Warranties of CLCC................. 5
Section 2.5. Representations and Warranties of GenPar............... 6
Section 2.6. Representations and Warranties of FW Ranch............. 6
ARTICLE III STANDSTILL.................................................. 6
Section 3.1. Acquisition of Company Securities...................... 6
Section 3.2. Further Restrictions on Holders' Conduct............... 7
Section 3.3. Publicity.............................................. 8
ARTICLE IV GOVERNANCE.................................................. 8
Section 4.1. Voting................................................. 8
Section 4.2. Director Designated by the Holders..................... 9
Section 4.3. Additional Non-Employee Directors...................... 10
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ARTICLE V RESTRICTIONS ON TRANSFERABILITY............................. 10
Section 5.1. Restrictions on Transferability........................ 10
Section 5.2. Notice of Proposed Transfers........................... 11
Section 5.3. Right of First Refusal................................. 11
Section 5.4. Restrictive Legends.................................... 12
ARTICLE VI REGISTRATION RIGHTS......................................... 13
Section 6.1. Demand Registration.................................... 13
Section 6.2. Company Registration................................... 14
Section 6.3. Expenses of Registration............................... 15
Section 6.4. Plan of Distribution................................... 15
Section 6.5. Indemnification........................................ 16
Section 6.6. Obligations of the Company............................. 18
Section 6.7. Securities Law Compliance.............................. 19
Section 6.8. Standoff Agreement..................................... 19
ARTICLE VII MISCELLANEOUS............................................... 20
Section 7.1. Termination............................................ 20
Section 7.2. Rule 144 Requirements.................................. 20
Section 7.3. Amendment.............................................. 20
Section 7.4. Investment Representation.............................. 20
Section 7.5. Notices, etc........................................... 20
Section 7.6. Entire Agreement; Severability......................... 21
Section 7.7. Governing Law.......................................... 21
Section 7.8. Counterparts........................................... 21
Section 7.9. Holders' Representative................................ 21
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TRANSFER, REGISTRATION RIGHTS AND GOVERNANCE AGREEMENT
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This Transfer, Registration Rights and Governance Agreement ("Agreement")
is entered into as of September 17, 1997 by and among United States Filter
Corporation, a Delaware corporation (the "Company"), Western Farm & Cattle
Company, a California corporation ("Western Farm & Cattle"), California Land &
Cattle Company, a Delaware corporation ("CLCC"), N.N. Investors, L.P., a
Delaware limited partnership ("N.N. Investors"), ST Ranch GenPar, Inc., a Texas
corporation ("GenPar"), and FW Ranch, L.P., a Texas limited partnership ("FW
Ranch"), with reference to certain shares of Common Stock, $.01 par value, of
the Company (the "Common Stock").
WHEREAS, Western Farm & Cattle, CLCC, N.N. Investors, GenPar, FW Ranch and
the Company have entered into an Agreement for Sale and Purchase of Partnership
Interests dated as of August 3, 1997 (the "Acquisition Agreement") pursuant to
which, among other things, (i) GenPar, the sole general partner of FW
Ranchlands, L.P., a Texas limited partnership ("FWRLP"), assigned to the Company
and the Company acquired from GenPar, a 1% general partner interest in FWRLP
(the "FWRLP GP Interest"), (ii) FW Ranch, the sole limited partner of FWRLP,
assigned to the Company, and the Company acquired from FW Ranch, a 99% limited
partner interest in FWRLP (the "FWRLP LP Interest"), (iii) Western Farm &
Cattle, the sole general partner of Western Farms, L.P., a California limited
partnership ("WFLP"), assigned to the Company, and the Company acquired from
Western Farm & Cattle, a 1% general partner interest in WFLP ("WFLP GP
Interest"), (iv) CLCC, the sole general partner of and the holder of a 1%
general partner interest (the "California Farms GP Interest") in California
Farms, L.P., a Delaware limited partnership ("California Farms"), assigned to
the Company, and the Company acquired from CLCC, the California Farms GP
Interest, (v) N.N. Investors, the sole limited partner of and the holder of a
99% limited partner interest (the "California Farms LP Interest") in California
Farms, assigned to the Company, and the Company will acquire from N.N.
Investors, the California Farms LP Interest, and (vi) the Company issued to
Western Farm & Cattle, CLCC, N.N. Investors, GenPar and FW Ranch, as
consideration for the WFLP GP Interest, the California Farms GP Interest, the
California Farms LP Interest, the FWRLP GP Interest and the FWRLP LP Interest,
an aggregate of 8,000,000 shares of Common Stock, subject to adjustment as
provided therein, and 1,200,000 warrants to purchase shares of Common Stock (the
"Warrants");
WHEREAS, in connection with the transactions contemplated by the
Acquisition Agreement, the Company, Western Farm & Cattle, CLCC, N.N. Investors,
GenPar, and FW Ranch desire to set forth certain agreements among them with
respect to the governance of the Company and the transferability and
registration of the Shares (as defined below) and the shares of Common Stock
issuable upon exercise of the Warrants ("Warrant Shares");
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements hereinafter set forth, the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
Section 1.1. Certain Definitions. As used in this Agreement, the
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following terms shall have the following respective meanings:
"Affiliate" shall mean any Person (a) more than 50% of any class of
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the outstanding voting securities of which is owned, directly or
indirectly, by one or more Holders and/or one or more Affiliates, or (b)
over which one or more Holders is otherwise able to exert actual control;
provided, however, that, for purposes of clause (b) of this definition,
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actual control shall be determined solely based on whether the Holder has
in fact the ability to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities,
by contract or otherwise.
"Beneficially Own" or "Beneficial Ownership" with respect to any
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securities shall mean "beneficial ownership" of such securities (as
determined pursuant to Rule 13d-3 promulgated under the Exchange Act).
"Board of Directors" shall mean the Board of Directors of the Company.
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"Commission" shall mean the United States Securities and Exchange
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Commission or any other federal agency at the time administering the
Securities Act or the Exchange Act.
"Common Stock Equivalent" shall mean (a) shares of any class of
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capital stock, other than Common Stock, of the Company which are then
entitled to vote generally in the election of directors and (b) any
warrant, option, convertible security or other similar right to acquire the
Common Stock or shares of any other class of capital stock of the Company
which are then entitled to vote generally in the election of directors.
"Exchange Act" shall mean the United States Securities Exchange Act of
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1934, as amended, or any federal statute enacted in replacement thereof,
all as the same shall be in effect at the time.
"Holder Designee" shall have the meaning specified in Section 4.2
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hereof.
"Holders" shall mean Western Farm & Cattle, N.N. Investors, CLCC,
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GenPar and FW Ranch, and shall also include all permitted transferees of
Registrable Shares, provided that such transferees agree to be bound by the
terms of this Agreement and such transfer is made in compliance with this
Agreement and applicable law.
"Person" shall mean any individual, partnership, joint venture,
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limited liability company, corporation, trust, unincorporated organization,
government or department or agency of a government.
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"Registrable Shares" shall mean the Shares and the Warrant Shares, if
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issued; provided, however, that Shares and Warrant Shares, if any, shall be
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treated as Registrable Shares only if and so long as they have not been
sold (x) in a public distribution or a public securities transaction, or
(y) in a transaction exempt from the registration and prospectus delivery
requirements of the Securities Act under Section 4(1) thereof so that all
transfer restrictions and restrictive legends with respect thereto are
removed upon the consummation of such sale.
The terms "register," "registered" and "registration" refer to a
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registration effected by preparing and filing a registration statement in
compliance with the Securities Act and the rules and regulations
promulgated thereunder, and the declaration or ordering of the
effectiveness of such registration statement.
"Registration Expenses" shall mean all registration, qualification and
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filing fees (including N.A.S.D. filing fees), fees and disbursements of
counsel for the Company, accounting fees incident to any such registration
and blue sky fees and expenses.
"Rule 144" shall mean Rule 144 promulgated under the Securities Act,
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as such Rule shall be in effect at the time, and any successor thereto.
"Rule 145" shall mean Rule 145 promulgated under the Securities Act,
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as such Rule shall be in effect at the time, and any successor thereto.
"Securities Act" shall mean the United States Securities Act of 1933,
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as amended, or any federal statute enacted in replacement thereof, all as
the same shall be in effect at the time.
"Selling and Distribution Expenses" shall mean all costs and expenses
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applicable to a registration, other than Registration Expenses, including
without limitation underwriting discounts, selling commissions and stock
transfer taxes applicable to the Shares registered by the Holders, fees and
disbursements of counsel for the Holders retained by them, printing
expenses and marketing expenses.
"Shares" shall mean the shares of Common Stock issued to or for the
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benefit of the Holders pursuant to the Acquisition Agreement (other than
the Warrant Shares), and any shares of Common Stock issued in respect
thereof or into which the Shares shall be converted in connection with
stock splits, reverse stock splits, stock dividends or distributions, or
combinations or similar recapitalization, on or after the date hereof.
"Standstill Termination Date" shall mean the date that is 29 months
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after the date of this Agreement.
"13D Group" shall mean any group of Persons acquiring, holding, voting
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or disposing of any Common Stock or Common Stock Equivalents which would be
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required under Section 13(d) of the Exchange Act and the rules and
regulations thereunder to file a statement on Schedule 13D with the
Commission as a "person" within the meaning of Section 13(d)(3) of the
Exchange Act.
"Transfer" shall mean any sale, transfer or other disposition (but not
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a pledge or encumbrance) to any Person other than another Holder, and to
"Transfer" shall mean to sell, transfer or otherwise dispose of (but not to
pledge or encumber) to any Person other than another Holder.
"Warrant Shares" shall mean the shares of Common Stock, if any, issued
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upon exercise of the Warrants.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
Section 2.1. Representations and Warranties of the Company. The Company
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represents and warrants to Western Farm & Cattle, N.N. Investors, CLCC, GenPar
and FW Ranch as of the date hereof as follows:
(a) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State of
Delaware and has corporate power and authority to enter into this Agreement and
to carry out its obligations hereunder.
(b) This Agreement has been duly and validly authorized by the
Company and all necessary and appropriate action has been taken by the Company
to execute and deliver this Agreement and to perform its obligations hereunder.
(c) This Agreement has been duly executed and delivered by the
Company and, assuming due authorization and valid execution and delivery by
Western Farm & Cattle, N.N. Investors, CLCC, GenPar and FW Ranch, this Agreement
is a legal, valid and binding obligation of the Company, enforceable in
accordance with its terms, subject to (i) bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium and other similar laws now or
hereafter in effect relating to or affecting creditors' rights generally and
(ii) general principles of equity (regardless of whether considered in a
proceeding at law or in equity).
Section 2.2. Representations and Warranties of Western Farm & Cattle.
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Western Farm & Cattle represents and warrants to the Company as of the date
hereof as follows:
(a) Western Farm & Cattle has been duly incorporated and is
validly existing as a corporation in good standing under the laws of the State
of California and has corporate power and authority to enter into this Agreement
and to carry out its obligations hereunder.
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(b) This Agreement has been duly and validly authorized by
Western Farm & Cattle and all necessary and appropriate action has been taken by
Western Farm & Cattle to execute and deliver this Agreement and to perform its
obligations hereunder.
(c) This Agreement has been duly executed and delivered by
Western Farm & Cattle and, assuming due authorization and valid execution and
delivery by the Company, CLCC, N.N. Investors, GenPar and FW Ranch, this
Agreement is a valid and binding obligation of Western Farm & Cattle,
enforceable in accordance with its terms, subject to (i) bankruptcy, insolvency,
reorganization, fraudulent transfer, moratorium and other similar laws now or
hereafter in effect relating to or affecting creditors' rights generally and
(ii) general principles of equity (regardless of whether considered in a
proceeding at law or in equity).
Section 2.3. Representations and Warranties of N.N. Investors. N.N.
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Investors represents and warrants to the Company as of the date hereof as
follows:
(a) N.N. Investors has been duly organized and is validly
existing as a limited partnership in good standing under the laws of the State
of Delaware and has all requisite power and authority to enter into this
Agreement and to carry out its obligations hereunder.
(b) This Agreement has been duly and validly authorized by N.N.
Investors and all necessary and appropriate action has been taken by N.N.
Investors to execute and deliver this Agreement and to perform its obligations
hereunder.
(c) This Agreement has been duly executed and delivered by N.N.
Investors and, assuming due authorization and valid execution and delivery by
the Company, Western Farm & Cattle, CLCC, GenPar and FW Ranch, this Agreement is
a valid and binding obligation of N.N. Investors, enforceable in accordance with
its terms, subject to (i) bankruptcy, insolvency, reorganization, fraudulent
transfer, moratorium and other similar laws now or hereafter in effect relating
to or affecting creditors' rights generally and (ii) general principles of
equity (regardless of whether considered in a proceeding at law or in equity).
Section 2.4. Representations and Warranties of CLCC. CLCC represents and
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warrants to the Company as of the date hereof as follows:
(a) CLCC has been duly incorporated and is validly existing as a
corporation in good standing under the laws of the State of Delaware and has all
requisite power and authority to enter into this Agreement and to carry out its
obligations hereunder.
(b) This Agreement has been duly and validly authorized by CLCC
and all necessary and appropriate action has been taken by CLCC to execute and
deliver this Agreement and to perform its obligations hereunder.
(c) This Agreement has been duly executed and delivered by CLCC
and, assuming due authorization and valid execution and delivery by the Company,
Xxxxxxx Xxxx &
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Xxxxxx, X.X. Investors, GenPar and FW Ranch, this Agreement is a valid and
binding obligation of CLCC, enforceable in accordance with its terms, subject to
(i) bankruptcy, insolvency, reorganization, fraudulent transfer, moratorium and
other similar laws now or hereafter in effect relating to or affecting
creditors' rights generally and (ii) general principles of equity (regardless of
whether considered in a proceeding at law or in equity).
Section 2.5. Representations and Warranties of GenPar. GenPar represents
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and warrants to the Company as of the date hereof as follows:
(a) GenPar has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the State of Texas and has
corporate power and authority to enter into this Agreement and to carry out its
obligations hereunder.
(b) This Agreement has been duly and validly authorized by
GenPar and all necessary and appropriate action has been taken by GenPar to
execute and deliver this Agreement and to perform its obligations hereunder.
(c) This Agreement has been duly executed and delivered by
GenPar and, assuming due authorization and valid execution and delivery by the
Company, Western Farm & Cattle, CLCC, N.N. Investors and FW Ranch, this
Agreement is a valid and binding obligation of GenPar, enforceable in accordance
with its terms, subject to (i) bankruptcy, insolvency, reorganization,
fraudulent transfer, moratorium and other similar laws now or hereafter in
effect relating to or affecting creditors' rights generally and (ii) general
principles of equity (regardless of whether considered in a proceeding at law or
in equity).
Section 2.6. Representations and Warranties of FW Ranch. FW Ranch
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represents and warrants to the Company as of the date hereof as follows:
(a) FW Ranch has been duly organized and is validly existing as
a limited partnership in good standing under the laws of the State of Texas and
has all requisite power and authority to enter into this Agreement and to carry
out its obligations hereunder.
(b) This Agreement has been duly and validly authorized by FW
Ranch and all necessary and appropriate action has been taken by FW Ranch to
execute and deliver this Agreement and to perform its obligations hereunder.
(c) This Agreement has been duly executed and delivered by FW
Ranch and, assuming due authorization and valid execution and delivery by the
Company, Western Farm & Cattle, CLCC, N.N. Investors and GenPar, this Agreement
is a valid and binding obligation of FW Ranch, enforceable in accordance with
its terms, subject to (i) bankruptcy, insolvency, reorganization, fraudulent
transfer, moratorium and other similar laws now or hereafter in effect relating
to or affecting creditors' rights generally and (ii) general principles of
equity (regardless of whether considered in a proceeding at law or in equity).
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ARTICLE III
STANDSTILL
Section 3.1. Acquisition of Company Securities. Each Holder agrees with
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the Company that, without the prior approval of a majority of the members of the
Board of Directors at a duly convened meeting thereof or of all of the Company's
directors by written consent thereto, prior to the Standstill Termination Date
such Holder will not, and will cause each of its Affiliates not to, singly or as
part of a partnership, limited partnership, syndicate or other 13D Group,
directly or indirectly, (i) acquire Beneficial Ownership of any Common Stock or
Common Stock Equivalents (other than pursuant to (A) exercise of any Warrant,
(B) the receipt of any dividends payable in Common Stock or Common Stock
Equivalents or (C) an acquisition as a result of which the Holders and their
Affiliates would not Beneficially Own Common Stock or Common Stock Equivalents
representing in the aggregate more than 25.0% of the outstanding Common Stock
and Common Stock Equivalents) or (ii) commence an unsolicited tender offer or
exchange offer for all or any portion of the Common Stock or any class of Common
Stock Equivalent not owned by the Holders or any unsolicited offer to the
Company to purchase all or substantially all of the assets of the Company;
provided, however, that the foregoing restrictions shall cease to apply if a
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bona fide offer, tender offer or exchange offer is made by any Person (other
than the Company, any Holder or any Affiliate of any Holder) to purchase
outstanding shares of Common Stock or any Common Stock Equivalent representing
50% or more of the Common Stock or any class of Common Stock Equivalent and such
offer is not accepted or rejected by the Company within five days after it is
made; and provided, further, that (a) the $25,000,000 aggregate principal amount
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of the 4.5% Convertible Subordinated Debentures due December 15, 2001 of the
Company Beneficially Owned by XxXxxxx & Co., L.P. on the date of this Agreement
(and any shares of Common Stock issuable upon conversion thereof) shall not be
counted for purposes of determining compliance with the limitations of this
Section 3.1 and (b) XxXxxxx & Co., L.P., for its own account or for its client
accounts (which may include affiliates or associates of the Holders), is
permitted to engage in arbitrage and related trading in the equity and debt
securities of the Company in the ordinary course of business, provided that no
confidential information has been disclosed to any person directing such trading
or executing any order with respect thereto, such activity is in compliance with
applicable federal securities laws and XxXxxxx is not a member of any 13D Group
with the Holders.
Section 3.2. Further Restrictions on Holders' Conduct. Prior to the
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Standstill Termination Date, the Holders agree that they shall not, and they
shall cause each of their Affiliates not to:
(a) in any manner acquire, agree to acquire or make any proposal
to acquire, directly or indirectly, any securities or property of the Company or
any of its subsidiaries other than in a manner consistent with the terms of this
Agreement;
(b) deposit (either before or after the date of the execution of
this Agreement) any Common Stock or Common Stock Equivalent in a voting trust or
subject any Common Stock or Common Stock Equivalent to any similar arrangement
or proxy with respect
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to the voting of such Common Stock or Common Stock Equivalents if the effect of
any such arrangement or proxy would result in a violation by any Holder of the
terms of this Agreement;
(c) make, or in any way participate, directly or indirectly, in
any "solicitation" of "proxies," or become a "Participant" in a "solicitation"
(as such terms are used in Regulation 14A promulgated under the Exchange Act) to
vote, or to seek to advise or influence any person to vote against any proposal
or director nominee recommended to the stockholders of the Company or any of its
subsidiaries by at least a majority of the members of the Board of Directors;
provided, however, that the restriction of this Section 3.2(c) shall not apply:
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(i)(A) during any proxy solicitation from a Person other than the Company
pursuant to which such Person seeks to take any action which, if successful, and
when combined with all other actions previously taken by such Person, would
result in a change in control of the Company (including, without limitation, by
means of electing or replacing directors of the Company), (B) during any offer,
tender offer or exchange offer for 50% or more of the Common Stock or any class
of Common Stock Equivalent or 50% or more of the consolidated assets of the
Company, and (C) with respect to any proposal by the Company which would result
in any other Person or 13D Group Beneficially Owning 50% or more of the Common
Stock or any class of Common Stock Equivalent or 50% or more of the consolidated
assets of the Company; and (ii) regarding any matter with respect to which the
Holders and their Affiliates are not bound by the terms of this Agreement to
vote in accordance with the recommendation of the Board of Directors;
(d) form, join or in any way participate in a 13D Group other
than in a manner consistent with the terms of this Agreement; or
(e) cooperate or agree with any third party who has contacted
any Holder or, to any Holder's knowledge, any Affiliate of such Holder in
connection with any of the foregoing.
Section 3.3. Publicity. The Company and each Holder shall, and each
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Holder shall cause each of its Affiliates to, prior to the issuance of any press
release or other public announcement or communication relating to the execution
or performance of this Agreement or to the transactions contemplated hereby,
consult with each other and use their best efforts to coordinate the issuance of
such press release, public announcement or communication.
ARTICLE IV
GOVERNANCE
Section 4.1. Voting. Until the Standstill Termination Date, each Holder,
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as a holder of shares of Common Stock and Common Stock Equivalents, agrees that:
(a) such Holder shall, and shall cause each of its Affiliates
to, be present, in person or by proxy, at all meetings of stockholders of the
Company so that all Common Stock and Common Stock Equivalents having voting
rights directly or indirectly owned by such
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Holder and its Affiliates may be counted for the purpose of determining the
presence of a quorum at such meetings; and
(b) such Holder shall, and shall cause each of its Affiliates
to, on any matter submitted to a vote of the Company's stockholders (other than
(i) the sale of all or substantially all of the assets of the Company, (ii) any
merger or acquisition transaction in which the Company is not the surviving
corporation or the parent of the surviving corporation (unless the holders of
the Company's Common Stock immediately prior to such transaction continue to own
80% or more of the outstanding voting stock of the surviving corporation or its
parent) or involving the issuance by the Company of shares of Common Stock
representing 20% or more of the outstanding Common Stock and Common Stock
Equivalents, (iii) any amendment of the certificate of incorporation or by-laws
of the Company that would adversely affect the rights of the Holders or (iv) the
dissolution or liquidation of the Company), vote or cause to be voted all Common
Stock and Common Stock Equivalents having voting rights with respect to such
matter directly or indirectly owned by such Holder and its Affiliates as
recommended by a majority of the members of the Board of Directors.
Section 4.2. Director Designated by the Holders. For so long as Western
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Farm & Cattle, CLCC, N.N. Investors, GenPar and FW Ranch, the direct and
indirect partners of N.N. Investors and FW Ranch and their respective Affiliates
collectively own at least 5% of the outstanding Common Stock:
(a) the Board of Directors shall elect as a Class I Director of
the Company (to serve until the next succeeding annual meeting of stockholders
of the Company at which Class I Directors are to be elected) on the date of the
Closing, one person designated by the Holders (the "Holder Designee," which term
shall include any person designated by the Holders to succeed any Class I
Director designated by the Holders pursuant to this Section 4.2) in writing to
the Company at least seven days prior to the date of the Closing. In the event
of a vacancy caused by the disqualification, removal, resignation or other
cessation of service of the Holder Designee from the Board of Directors, the
Board of Directors shall elect as a Class I Director of the Company (to serve
until the Company's next succeeding annual meeting of stockholders at which
Class I Directors are to be elected) a Holder Designee designated in writing to
the Company at least fifteen days prior to the date of a regular meeting of the
Board of Directors.
(b) At the first annual meeting of stockholders of the Company
following the Closing at which Class I Directors are to be elected and at each
subsequent annual meeting of stockholders of the Company at which (i) the term
of the Holder Designee is to expire or (ii) a vacancy caused by the
disqualification, removal, resignation or other cessation of service of the
Holder Designee is to be filled, the Company shall cause the Holder Designee or
a successor Holder Designee to be included in the slate of nominees recommended
by the Board of Directors to the Company's stockholders for election as
directors and shall use all reasonable efforts to cause the election of such
Holder Designee or successor Holder Designee to the Board of Directors,
including soliciting proxies in favor of the election of such person.
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(c) The Holders shall provide notice in writing at least 90 days
prior to any annual meeting of the Company's stockholders at which Class I
Directors are to be elected indicating the name of the Holder Designee and all
information required by Regulation 14A and Schedule 14A promulgated under the
Exchange Act with respect to such Holder Designee.
(d) In the event that the Holder Designee cannot attend any
meeting of the Board of Directors, the Holders shall be entitled to designate a
person to attend such meeting in a non-voting capacity at the Board of
Directors' invitation. The Company shall give the Holders no less than seven (7)
days' notice of any such meeting; provided, however, that if the Company is
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unable, for good cause, to give seven (7) days' notice with respect to any
meeting of its Board of Directors at which the Board of Directors considers
and/or acts upon any important corporate action, the Company may give such
lesser notice as is reasonably practicable, except that such notice shall in all
circumstances be at least two (2) full business days. Any Holder Designee may
participate telephonically in any meeting of the Board of Directors.
(e) The Holders shall consult with the Company in connection
with the identity of any proposed Holder Designee, but the Company shall not
have the right to object to any Holder Designee unless such person either (i) is
a director or officer of a direct competitor of the Company or (ii) has engaged
in any adverse conduct that would require disclosure under Item 7 of Schedule
14A promulgated under the Exchange Act. In any such case, the Holders agree to
withdraw such proposed person and nominate a replacement therefor (which
replacement shall be subject to the requirements of this Section 4.2(e)). Any
such objection by the Company must be made no later than one month after the
Holders first inform the Company of the identity of the proposed Holder
Designee; provided, however, that the Company shall in all cases notify the
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Holders of any such objection sufficiently in advance of the date on which proxy
materials are mailed by the Company in connection with such election of
directors to enable the Holders to propose an alternate Holder Designee pursuant
to and in accordance with the terms of this Agreement.
Section 4.3. Additional Non-Employee Directors. If, at any time while
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Western Farm & Cattle, N.N. Investors, CLCC, GenPar and FW Ranch, the direct and
indirect partners of N.N. Investors and FW Ranch and their respective Affiliates
continue to own at least 7 1/2% of the outstanding Common Stock, a vacancy shall
occur in the Board of Directors as the result of the cessation to serve of a
non-employee director (other than by reason of the death, disqualification,
resignation, removal or other cessation of service of a Holder Designee, which
vacancy shall be filled with a successor Holder Designee pursuant to Section
4.2(a)), such vacancy shall be filled by the Board of Directors only by a person
satisfactory to the Holders.
ARTICLE V
RESTRICTIONS ON TRANSFERABILITY
Section 5.1. Restrictions on Transferability.
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(a) The Shares may be Transferred only in accordance with the
conditions specified in this Agreement, which conditions are intended to ensure
compliance with the provisions of the Securities Act.
(b) The Holders shall not Transfer any Shares except for:
(i) Transfers of Shares in a registered public offering
pursuant to Article VI of this Agreement;
(ii) Transfers of Shares pursuant to Rule 144;
(iii) Transfers of Shares pursuant to any offer made by the
Company or any of its Affiliates;
(iv) Transfers of Shares to any direct or indirect partner
of any Holder or any Affiliate thereof; provided,
--------
however, that any such transferee shall agree with the
-------
Company in writing prior to each such Transfer to be
bound by the terms of this Agreement for the rest of
its duration;
(v) Transfers by will or the laws of descent and
distribution, Transfers by an individual to a spouse
or children or Transfers to trusts for the benefit of
a Holder's spouse and/or children; provided, however,
-------- -------
that any such transferee shall agree prior to (or as a
condition of) such transfer to be bound by the terms
of this Agreement for the rest of its duration; and
(vi) any other Transfers of Shares after a refusal by the
Company to purchase such Shares (by either lapse of
time or written notice) in accordance with Section 5.3
hereof.
Section 5.2. Notice of Proposed Transfers. The Holder of each certificate
----------------------------
representing Shares by acceptance thereof agrees to comply in all respects with
the provisions of this Agreement. Prior to any proposed Transfer of any Shares,
unless there is in effect a registration statement under the Securities Act
covering the proposed Transfer or the Transfer is pursuant to Rule 144 and
covers fewer than 500,000 shares, the Holder thereof shall notify the Company in
writing of such Holder's intention to effect such Transfer and the intended
manner and circumstances thereof in reasonable detail. If requested by the
Company, any such notice shall be accompanied at such Holder's expense by a
written opinion of legal counsel who is, and whose legal opinion shall be,
reasonably satisfactory to the Company, addressed to the Company, to the effect
that the proposed Transfer may be effected without registration of the
applicable Shares under the Securities Act, and by such certificates and other
information as the Company may reasonably require to confirm such opinion,
whereupon the Holder of such Shares shall be entitled to Transfer such Shares in
the manner contemplated by such opinion. Each certificate evidencing Shares
Transferred as above provided shall bear, except if such
-11-
transfer is made pursuant to Rule 144, the appropriate restrictive legends set
forth in Section 5.4(a) and (b) hereof, except that such certificate shall not
bear such restrictive legends if in the opinion of counsel for such Holder and
the Company the restrictive legend set forth in Section 5.4(a) hereof is not
required in order to establish compliance with any provisions of the Securities
Act. So long as such restrictive legend shall be required to remain on any such
certificates, the Transfer of any Shares represented thereby (excluding,
however, a Transfer pursuant to the realization by any pledgee (other than the
Company) upon Shares pledged with it) shall be conditioned upon the transferee
thereof becoming a party hereto.
Section 5.3. Right of First Refusal. In the event that, during the
----------------------
existence of this Agreement, any Holder shall desire to Transfer any Shares
under circumstances other than those referred to in Section 5.1(b)(i), (ii),
(iii), (iv) and (v) hereof:
(a) the notice given by such Holder to the Company pursuant to
Section 5.2 hereof shall specify the number of Shares to be sold, the
prospective purchasers thereof and the price and terms and conditions of such
sale, and offering to sell such Shares to the Company (or its designee) at such
price and on like terms and conditions.
(b) the Company shall have the right to accept or reject any
offer pursuant to subsection (a) as promptly as practicable but in all events
within the time period of one business day. Such time period shall run from, and
not include, the date of delivery of the notice of such offer pursuant to
subsection (a) above. If the Company shall accept such offer within the
applicable time period specified above, then the Company shall purchase the
Shares specified in the notice given pursuant to subsection (a) above as
promptly as is reasonably practicable, but in no event after the later of (i)
the 15th day following such acceptance and (ii) the third day following receipt
of all required governmental approvals.
(c) If the Company (i) shall reject such offer in writing, (ii)
shall not within the applicable time period after receipt of the notice given by
such Holder pursuant to subsection (a) above, accept such offer in writing with
respect to all the Shares specified in such notice or (iii) shall fail to
purchase such Shares within the time period specified in subsection (b) above,
then such Holder shall be free to enter into any agreement to sell such Shares
to the prospective purchaser, at a price equal to or above the minimum price and
on the terms and conditions specified in the notice delivered to the Company
pursuant to subsection (a) above.
(d) Any sale of Shares by any Holder pursuant to subsection (c)
above must be consummated within 30 days of the earlier of receipt of a written
rejection from the Company or the expiration of the applicable time period
allotted the Company for the rejection or consummation of the offer to sell such
Shares by such Holder.
(e) Each Holder that has determined to make (or commenced
negotiations to make) a Transfer (other than under the circumstances referred to
in Section 5.1(b)(i), (ii), (iii), (iv) and (v) hereof) shall give notice to the
Company of such fact at the earliest practicable time.
-12-
Section 5.4. Restrictive Legends.
-------------------
(a) Each certificate representing Shares which are Registrable
Shares shall (unless otherwise permitted by subsection (d) of this Section 5.4
or Section 5.2 hereof) be stamped with the following legend:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR
INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933. SUCH SECURITIES MAY NOT BE SOLD OR TRANSFERRED
IN THE ABSENCE OF SUCH REGISTRATION OR UNLESS THE COMPANY RECEIVES AN
OPINION OF COUNSEL (WHICH MAY BE COUNSEL FOR THE COMPANY) REASONABLY
ACCEPTABLE TO IT STATING THAT SUCH SALE OR TRANSFER IS EXEMPT FROM THE
REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SAID ACT.
(b) Each certificate representing Shares which are Registrable
Shares shall also be stamped with the following legend:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO THE
TERMS AND CONDITIONS OF AN AGREEMENT BETWEEN CERTAIN STOCKHOLDERS AND
THE COMPANY WHICH INCLUDES RESTRICTIONS ON CERTAIN SALES OF THE
SECURITIES. COPIES OF THE AGREEMENT MAY BE OBTAINED UPON WRITTEN
REQUEST TO THE SECRETARY OF THE COMPANY.
(c) Each certificate representing Shares which are Registrable
Shares shall be stamped with such other legends, if any, as are required by
applicable federal or state law.
(d) Each Holder consents to the Company's making a notation on
its records and giving instructions to any transfer agent of the Shares in order
to implement the restrictions on transfer established in this Agreement. The
legend placed on any certificate pursuant to Section 5.4(a) hereof and any
notations or instructions with respect to the Shares represented by such
certificate will be promptly removed, and the Company will promptly issue a
certificate without such legend to the Holder of such Shares (i) if such Shares
are registered under the Securities Act (but only in connection with the actual
sale of such securities) and a prospectus meeting the requirements of Section 10
of the Securities Act is available, (ii) if the Holder thereof satisfies the
requirements of Rule 144(k) and, where reasonably determined necessary by the
Company, provides the Company with an opinion of counsel for the Holder of the
Shares, both such counsel and such opinion being satisfactory to the Company, to
the effect that (A) the Holder meets the requirements of Rule 144(k) or (B) a
public sale, transfer or assignment of the Shares may be made without
registration.
-13-
ARTICLE VI
REGISTRATION RIGHTS
Section 6.1. Demand Registration. At any time or from time to time during
-------------------
the four year period commencing 29 months after the date of this Agreement, one
or more Holders may on two separate occasions require the Company, by delivery
to the Company of a notice in writing (a "Demand"), to cause no fewer than
2,000,000 Registrable Shares held by such Holder or Holders to be registered for
sale to the public under the Securities Act. Upon receipt of such a notice, the
Company will use its best efforts to file a registration statement (on Form S-3
or successor form) with the Commission promptly (but not more than 30 days)
after such request and to effect such registration (including, without
limitation, the execution of an undertaking to file post-effective amendments,
appropriate qualification under applicable blue sky or other state securities
laws and appropriate compliance with applicable regulations under the Securities
Act) as would permit or facilitate the sale and distribution of such Registrable
Shares as are specified in such request in the manner of distribution specified
therein, together with all Registrable Shares of any Holder or Holders joining
in such request as are specified in written requests received by the Company
within 15 days after receipt of such Demand; provided, however, that the Company
-------- -------
shall not be obligated to take any action to effect any such registration,
qualification or compliance pursuant to this Section 6.1:
(a) in any particular jurisdiction in which the Company would be
required to qualify to do business or to execute a general consent to service of
process in effecting such registration, qualification or compliance except as
may be required by the Securities Act;
(b) during the period starting with the date 60 days prior to
the filing of, and ending on a date 120 days following the effective date of, a
registration statement filed by the Company (other than with respect to a
registration statement relating to a Rule 145 or other business combination
transaction, an offering solely to employees and/or directors or any other
registration which is not appropriate for the registration of Registrable
Shares); or
(c) at any time when the Holders would be required to refrain
from selling Registrable Shares pursuant to Section 6.7(b) hereof.
In the event that any Holder seeks to require the Company to effect the
registration of Shares at a time when the Company is not obligated to effect
such registration pursuant to clause (b) or (c) of the immediately preceding
sentence, such Holder shall be entitled to require the Company to effect the
registration of Shares as soon as the conditions specified in such clauses (b)
and (c) cease to apply. If at the time of receipt of a Demand pursuant to this
Section 6.1 there shall be any public offering of Common Stock contemplated by
the Company to occur within the following 90 days or in progress, then, upon
receipt of such Demand, the Company shall notify the Holders of such public
offering, advising them that they may elect to withdraw such Demand and
participate in such public offering pursuant to Section 6.2. Such withdrawn
Demand shall not count toward the two registrations provided by this Section
6.1.
Section 6.2. Company Registration.
--------------------
-14-
(a) Notice of Registration. If, at any time or from time to
----------------------
time, the Company shall determine to register any of its Common Stock, either
for its own account or for the account of a security holder or holders
exercising their respective demand registration rights for distribution pursuant
to an underwritten offering, the Company will (i) promptly give to each Holder
written notice thereof, and (ii) include in such registration (and any related
qualification under the blue sky laws or other compliance), subject to Section
6.2(b) hereof, all the Registrable Shares specified in a written request made by
any Holder within 30 days after its receipt of such written notice from the
Company. Such registration shall not constitute a demand registration described
under Section 6.1 hereof.
(b) Underwriting. If the registration pursuant to this Section
------------
6.2 hereof is an underwritten offering, the right of any Holder to such
registration shall be conditioned upon such Holder's participation in such
underwriting and the inclusion of Shares in the underwriting to the extent
provided herein. All Holders proposing to distribute all or a portion of their
Shares through such underwriting shall (together with the Company and the other
holders distributing shares of Common Stock through such underwriting) enter
into an underwriting agreement in customary form with the managing underwriter
selected for such underwriting by the Company (or by the holders who have
demanded such registration), and shall provide to the Company upon written
request such information referenced in Section 6.1(b) hereof as may be specified
in such request. Notwithstanding any other provision of this Section 6.2, if the
managing underwriter in its sole discretion determines that marketing factors
require a limitation of the number of shares to be underwritten, the managing
underwriter may limit the Shares to be included in such registration. The
Company shall so advise all Holders and the other holders distributing their
securities through such underwriting pursuant to piggyback registration rights
similar to the rights of the Holders under this Section 6.2, and the number of
Shares that may be included in the registration and underwriting by such
Holders, the Company and such other holders shall be reduced by the number of
shares determined by the managing underwriter not to be included in such
registration, such reduction to be allocated among the Holders, the Company and
such other holders in proportion, as nearly as practicable, to the respective
amounts of shares proposed to be registered by such Holders, by the Company and
by such other holders. If any Holder disapproves of the terms of any such
underwriting, it may elect to withdraw therefrom by written notice to the
Company and the managing underwriter.
(c) Right to Terminate Registration. The Company shall have the
-------------------------------
right to terminate or withdraw any registration under this Section 6.2 prior to
the effectiveness of such registration whether or not any Holder has elected to
include securities in such registration.
Section 6.3. Expenses of Registration. All Registration Expenses incurred
------------------------
in connection with any registration pursuant to Sections 6.1 or 6.2 hereof shall
be borne by the Company. All other Selling and Distribution Expenses relating to
securities registered on behalf of the Holders shall be borne by the Holders of
the Shares included in such registration, other selling stockholders and the
Company pro rata on the basis of the number of shares of Common Stock so
registered.
-15-
Section 6.4. Plan of Distribution.
--------------------
(a) The distribution of Registrable Shares pursuant to a
registration under Section 6.1 shall be effected only by or through such
investment banking firm or firms as may be designated by the Holders and as are
reasonably satisfactory to the Company in connection with the filing of the
applicable registration statement, acting in such capacity (as broker, dealer,
principal or otherwise), and receiving such compensation, as may be agreed by
the Holders of the Shares to be distributed and such investment banking firm or
firms.
(b) The Company shall give the Holder or Holders of Registrable
Shares to be included in any registration statement at least ten (10) days'
written notice prior to the filing of a registration statement pursuant to
Section 6.1 hereof. Such Holder or Holders shall advise the Company in writing
within five (5) days of receipt of such notice of the terms of its or their
compensation arrangements with the designated investment banking firm or firms,
the capacity in which such firm or firms will act, the distribution proposed by
such Holder or Holders and such information regarding such Holder or Holders and
the shares of Common Stock held by them as the Company may reasonably request in
writing and as shall be required in connection with any registration,
qualification or compliance referred to in this Agreement.
(c) The Holders shall be entitled to exclude from any
registration effected pursuant to Section 6.1 hereof any shares of Common Stock
other than Registrable Shares if the investment banking firm or firms designated
under subsection (a) hereof determines that marketing factors require a
limitation of the number of shares to be included in such registration.
(d) The Company hereby represents and warrants that it has no
agreement, undertaking or other arrangement granting to any third party the
right (whether demand, piggyback or otherwise) to require the Company to
register any class of shares of its capital stock, outstanding as of the date of
this Agreement, except as disclosed on Schedule 6.4(d).
Section 6.5. Indemnification.
---------------
(a) The Company will indemnify each Holder, each of its
officers, directors, partners, employees and agents and each person controlling
such Holder within the meaning of Section 15 of the Securities Act, with respect
to which registration, qualification or compliance has been effected pursuant to
this Agreement, against all expenses, claims, losses, damages or liabilities (or
actions in respect thereof), including any of the foregoing incurred in
settlement of any litigation, commenced or threatened, arising out of or based
on any untrue statement (or alleged untrue statement) of a material fact
contained in any registration statement, prospectus, offering circular or other
document, or any amendment or supplement thereto, incident to any such
registration, qualification or compliance, or based on any omission (or alleged
omission) to state therein a material fact required to be stated therein or
necessary to make the statements therein, in the light of the circumstances in
which they were made, not misleading, or any violation by the Company of any
rule or regulation promulgated under the Securities Act or any other federal,
state or common law rule or regulation applicable to the Company in connection
-16-
with any such registration, qualification or compliance, and the Company will
reimburse each such Holder, each of its officers, directors, employees and
agents and each person controlling such Holder for any legal and any other
expenses reasonably incurred in connection with investigating, preparing or
defending any such claim, loss, damage, liability or action; provided, however,
-------- -------
that the Company will not be liable in any such case to the extent that any such
claim, loss, damage, liability or expense arises out of or is based on any
untrue statement or omission or alleged untrue statement or omission made in
reliance upon and in conformity with any written information furnished to the
Company pursuant to an instrument duly executed by such Holder or controlling
person and stated to be specifically for use therein.
(b) Each Holder will, if Shares held by such Holder are included
in the securities as to which such registration, qualification or compliance is
being effected, indemnify the Company, each of its directors and officers, each
underwriter, if any, of the Company's securities covered by such a registration
statement, each person who controls the Company or such underwriter within the
meaning of Section 15 of the Securities Act, and each other such Holder, each of
its officers and directors and each person controlling such Holder within the
meaning of Section 15 of the Securities Act, against all claims, losses, damages
and liabilities (or actions in respect thereof) arising out of or based on any
untrue statement (or alleged untrue statement) of a material fact contained in
any such registration statement, prospectus, offering circular or other
document, or 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, and will reimburse the Company, such Holders, such directors,
officers, persons, underwriters or control persons for any legal or any other
expense reasonably incurred in connection with investigating or defending any
such claim, loss, damage, liability or action, in each case to the extent, but
only to the extent, that such untrue statement (or alleged untrue statement) or
omission (or alleged omission) is made in such registration statement,
prospectus, offering circular or other document in reliance upon and in
conformity with any written information furnished to the Company pursuant to an
instrument duly executed by such Holder and stated to be specifically for use
therein.
(c) Each party entitled to indemnification under this Section
6.5 (the "Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought, but the
failure of any Indemnified Party to give notice as provided herein shall not
relieve the Indemnifying Party of its obligations under this Agreement unless,
but only to the extent that, the failure to give such notice is actually
prejudicial to an Indemnifying Party's ability to defend such action, and shall
permit the Indemnifying Party to assume the defense of any such claim or any
litigation resulting therefrom, provided that counsel for the Indemnifying
Party, who shall conduct the defense of such claim or litigation, shall be
approved by the Indemnified Party (whose approval shall not be unreasonably
withheld), and the Indemnified Party may participate in such defense at such
party's expense; provided, however, that if the Indemnified Party determines in
-------- -------
good faith that a conflict of interest exists and that therefore it is advisable
for such Indemnified Party or parties to be represented by separate counsel or
that, upon written advice and legal opinion of counsel, there may be sound legal
defenses available to it or them which are different from or in
-17-
addition to those available to the Indemnifying Party, then the Indemnifying
Party shall not be entitled to assume such defense and the Indemnified Parties
shall be entitled to counsel at the Indemnifying Party's expense. If an
Indemnifying Party is not so entitled to assume the defense of such action or
does not assume such defense, after having received the notice referred to in
the first sentence of this paragraph, the Indemnifying Party will pay the
reasonable fees and expenses of counsel of the Indemnified Party. No
Indemnifying Party, in the defense of any such claim or litigation, shall,
except with the consent of each Indemnified Party, consent to entry of any
judgment or enter into any settlement which does not include as an unconditional
term thereof the giving by the claimant or plaintiff to such Indemnified Party
of a release from all liability in respect to such claim or litigation.
(d) In order to provide for just and equitable contribution to
joint liability under the Securities Act in any case in which any Holder of
Shares exercising rights under this Agreement, or any controlling person of any
such Holder, makes a claim for indemnification pursuant to this Section 6.5 but
is judicially determined (by the entry of a final judgment or decree by a court
of competent jurisdiction and the expiration of time to appeal or the denial of
the last right of appeal) that such indemnification may not be enforced in such
case, notwithstanding the fact that this Section 6.5 provides for
indemnification in such case, the Company and such Holder will contribute to the
aggregate losses, claims, damages or liabilities to which they may be subject
(after contribution from others) in such proportion so that such Holder is
responsible for the portion represented by the percentage that the public
offering price of its Shares offered by the registration statement bears to the
public offering price of all Shares offered by such registration statement; and
the Company is responsible for the remaining portion not payable by any Holder
or other holder; provided, however, that, in any such case, (A) no such Holder
-------- -------
will be required to contribute any amount in excess of the public offering price
of all such Shares offered by it pursuant to such registration statement, and
(B) no person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) will be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
Section 6.6. Obligations of the Company. Whenever required under this
--------------------------
Agreement to use its best efforts to effect the registration of any Registrable
Shares, the Company shall, as expeditiously as reasonably possible:
(a) Prepare and file with the Commission a registration
statement with respect to such Registrable Shares, and use its best efforts to
cause such registration statement to become effective and, except in the case of
a firm commitment underwriting, to keep such registration statement effective
for the period required by the Holders up to 180 days.
(b) Prepare and file with the Commission such amendments and
supplements to such registration statement as may be necessary (i) to update and
keep such registration statement effective as provided in Section 6.6(a) hereof,
(ii) to comply with the provisions of the Securities Act with respect to the
disposition of all Registrable Shares covered by such registration statement and
(iii) to reflect a modification in the manner of distribution of such
Registrable Shares. Notwithstanding anything else to the contrary contained
herein, the
-18-
Company shall not be required to disclose in any amendment or supplement to a
registration statement or otherwise (x) any confidential information concerning
any matter which is the subject of a notice given under Section 6.6(f) hereof as
to which the Company has a bona fide interest in withholding disclosure, or (y)
historical financial statements or pro forma financial information required by
Regulation S-X of the Commission in connection with a business acquisition or
disposition prior to the date when such information would otherwise be required
to be filed with the Commission (including extensions pursuant to Item 7(a)(4)
of Form 8-K).
(c) Furnish to the Holders such numbers of copies of any
prospectus included in such registration statement, including any preliminary
prospectus, in conformity with the requirements of the Securities Act, and such
other documents as they may reasonably request in order to facilitate the
disposition of such Registrable Shares owned by them.
(d) Use its best efforts to register and qualify the
Registrable Shares covered by such registration statement under such other
securities or blue sky laws of such jurisdictions as shall be reasonably
requested by the Holders whose Registrable Shares have been included in such
registration statement, provided that the Company shall not be required in
connection therewith or as a condition thereto to qualify to do business or to
file a general consent to service of process in any such states or
jurisdictions.
(e) In the event of any underwritten public offering
contemplated by Section 6.1 hereof, enter into and perform its obligations under
an underwriting agreement, in usual and customary form, with the managing
underwriter of such offering and participate with such managing underwriter in
road shows and other customary marketing activities. Each Holder participating
in such underwriting shall also enter into and perform its obligations under
such an agreement.
(f) Notify each Holder of Registrable Securities covered by such
registration statement, at any time when a prospectus relating thereto is
required to be delivered under the Securities Act, or upon the happening of any
event as a result of which 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
under which the prospectus is used, and, except for a period not to exceed 180
days in each instance where the Company has a bona fide corporate interest in
withholding disclosure or the time period for filing with the Commission
information referred to in Section 6.6(b)(y) hereof has not expired, promptly
prepare and furnish to such Holders a supplement or amendment to such
prospectus, or otherwise update such prospectus through the filing of a Current
Report on Form 8-K or otherwise, so that such prospectus will not contain an
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not misleading.
Section 6.7. Securities Law Compliance.
-------------------------
(a) The Holder or Holders of Registrable Shares included in any
registration pursuant to this Agreement covenant that they will comply with the
Securities Act and with the
-19-
Exchange Act with respect to any such registration, recognizing that the Company
may notify such Holder or Holders in accordance with Section 6.6(f) hereof that
the registration statement is not then current.
(b) The Holders agree that, immediately upon receipt of a
notification pursuant to Section 6.6(f) hereof, they will refrain from selling
Registrable Shares under a registration statement filed pursuant to Section 6.1
hereof until (i) subsequently notified by the Company that the registration is
current or (ii) receipt of a favorable opinion of counsel as hereinbelow
provided. The Company agrees that it will consult with the Holders and, at the
Holders' request, counsel for the Holders following the giving of such
notification, and that in the event the Holders (or their counsel) is of the
view that the Shares subject to such registration could be sold in compliance
with the Securities Act and the Exchange Act without disclosure of the nonpublic
information which is the subject of the notification, the parties hereto agree
to be bound by an opinion of counsel reasonably satisfactory to the Holders and
the Company as to whether such sales can be made without violation of the
Securities Act or the Exchange Act.
Section 6.8. Standoff Agreement. The Holders agree in connection with any
------------------
registration of the Company's securities, which include, without limitation,
Shares to be sold by the Holders, upon request of the underwriters managing any
underwritten offering of the Company's securities, not to sell, make any short
sale of, loan, grant any option for the purchase of, or otherwise dispose of any
Registrable Shares (other than those included in such registration), without the
prior written consent of the Company or such underwriters, as the case may be,
for such period of time (not to exceed 120 days) from the effective date of such
registration as may be requested by the Company or such managing underwriters.
ARTICLE VII
MISCELLANEOUS
Section 7.1. Termination. This Agreement shall terminate upon the tenth
-----------
anniversary of the date hereof; provided, however, that this Agreement shall
-------- -------
terminate earlier upon the occurrence of any of the following:
(a) any third party acquires Common Stock or Common Stock
Equivalents representing 50% or more of the outstanding Common Stock;
(b) the Company agrees to merge with and into any entity, if the
Company will not be the surviving entity in such merger; or
(c) Holders, the direct and indirect partners of N.N. Investors
and FW Ranch and their Affiliates shall cease to own at least 5% of the
outstanding Common Stock.
-20-
Section 7.2. Rule 144 Requirements. The Company agrees to:
---------------------
(a) use its best efforts to file with the Commission in a timely
manner all reports and other documents required of the Company under the
Securities Act and the Exchange Act and the rules and regulations promulgated
thereunder; and
(b) furnish to any Holder of Registrable Shares upon request (i)
a written statement by the Company as to its compliance with the requirements of
Rule 144(c), and the reporting requirements of the Securities Act and the
Exchange Act and the rules and regulations promulgated thereunder, (ii) a copy
of the most recent annual or quarterly report of the Company, and (iii) such
other reports and documents of the Company as such Holder may reasonably request
to avail itself of any similar rule or regulation of the Commission allowing
such Holder to sell any such securities without registration.
Section 7.3. Amendment. Any provision of this Agreement may be amended
---------
and the observance thereof may be waived (either generally or in a particular
instance and either retroactively or prospectively), only with the written
consent of the Company and 66-2/3% in interest of the Holders. Any amendment or
waiver effected in accordance with this Section 7.3 shall be binding upon each
Holder of any Shares then outstanding, each future holder of any Shares who is a
party to this Agreement, and the Company.
Section 7.4. Investment Representation. Each Holder hereby confirms and
-------------------------
represents and warrants to the Company that such Holder is acquiring the Shares
for investment only and not with a view to or in connection with any resale or
distribution of the Shares.
Section 7.5. Notices, etc. All notices, requests, demands and other
-------------
communications hereunder shall be in writing and shall be deemed to have been
duly given if delivered by hand, courier service, United States mail (return
receipt requested) or by facsimile, addressed as follows:
(a) if to Western Farm & Cattle, N.N. Investors, CLCC, GenPar or
FW Ranch, to:
Western Farm & Cattle Company
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxx Xxxxx, Xxxxx 00000
Fax: 000-000-0000
Attn: Xxxxx Xxxxx
with a copy to:
F. Xxxxxxx Xxxxxxxx
Xxxxx, Xxxx & Xxxxxxx
000 Xxxx Xxxxxx, Xxxxx 0000
Xxxx Xxxxx, Xxxxx 00000
Fax: 000-000-0000
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(b) if to the Company, to:
United States Filter Corporation
00-000 Xxxx Xxxxxx
Xxxx Xxxxxx, XX 00000
Fax No. (000) 000-0000
Attn: Chief Executive Officer
with a copy to: General Counsel
or to such other address or facsimile number of a party of which such party has
given notice to the other parties pursuant to this Section.
Section 7.6. Entire Agreement; Severability. This Agreement and the
------------------------------
Acquisition Agreement together with the Schedules and Exhibits thereto set forth
all of the provisions, covenants, agreements, conditions and undertakings among
the parties hereto with respect to the subject matter hereof. The provisions of
this Agreement are severable, and in the event that any one or more provisions
are deemed illegal or unenforceable, the remaining provisions shall remain in
full force and effect.
Section 7.7. Governing Law. This Agreement shall be governed by and
-------------
construed in accordance with the laws (other than those with respect to choice
of law) of the State of Delaware. Each of the parties hereto agrees that all
claims in any action or proceeding arising out of or related to this Agreement
may be heard and determined in any Delaware state court or federal court sitting
in the State of Delaware.
Section 7.8. Counterparts. This Agreement may be executed simultaneously
------------
in any number of counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same instrument.
Section 7.9. Holders' Representative.
-----------------------
(a) Creation. The Holders do hereby, for themselves and their
--------
personal representatives and other successors, constitute and appoint a
representative, initially Xxxxx Xxxxx (the "Representative"), as their agent and
attorney-in-fact to give and receive all notices and consents under this
Agreement. The Representative will advise the other Holders of notices and
other communications received by him hereunder.
(b) Replacement. In the event of the death, physical or mental
-----------
incapacity or resignation of the Representative, the Holders shall promptly
appoint a substitute or substitutes and shall advise the Company thereof. As
between the Representative and the Holders, the Representative shall not be
liable for, and shall be indemnified by the Holders against, any good faith
error of judgment on his part or any other act done or omitted by him in good
faith in connection with his duties as the Representative, except for gross
negligence or willful misconduct.
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(c) Company Reliance. The Company shall be entitled to rely
----------------
exclusively upon any communications given by the Representative on behalf of all
Holders, and shall not be liable for any action taken or not taken in reliance
upon the Representative. The Company shall be entitled to disregard any notices
or communications given or made by the Holders unless given or made through the
Representative.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
UNITED STATES FILTER CORPORATION
By: /s/ Xxxxxxx X. Xxxxx
---------------------
Name: Xxxxxxx X. Xxxxx
Title: Attorney-in-Fact for
President & CEO,
Xxxxxxx X. Xxxxxxxx
WESTERN FARM & CATTLE COMPANY
By: /s/ Xxxxx X. Xxxxx
-------------------
Name: Xxxxx X. Xxxxx
Title: President
N.N. INVESTORS, L.P.
By: California Land & Cattle Company,
its General Partner
By: /s/ Xxxxx X. Xxxxx
-------------------
Name: Xxxxx X. Xxxxx
Title: President
CALIFORNIA LAND & CATTLE COMPANY
By: /s/ Xxxxx X. Xxxxx
-------------------
Name: Xxxxx X. Xxxxx
Title: President
ST RANCH GENPAR, INC.
By: /s/ Xxxxx X. Xxxxx
-------------------
Name: Xxxxx X. Xxxxx
Title: President
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FW RANCH PARTNERS, L.P.
By: ST Ranch GenPar, Inc.,
its General Partner
By: /s/ Xxxxx X. Xxxxx
-------------------
Name: Xxxxx X. Xxxxx
Title: President
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Schedule 6.4(d)
---------------
Transfer and Registration Agreement between United States Filter Corporation and
Alcoa Securities Corporation dated as of December 31, 1991.
Transfer, Registration and Other Rights Agreement among United States Filter
Corporation, Warburg, Xxxxxx Capital Company, L.P. and Certain Individual
Stockholders of United States Filter Corporation dated as of July 8, 1994.
Transfer, Registration and Other Rights Agreement among United States Filter
Corporation, Xxxxxxx International Investments (Luxembourg) S.A., Xxxxxxx
Investments (Barbados) Ltd., Marfit, S.p.A., Xxxxxxx, Inc. and Ing.
Xxxxxxxx Cominetta dated as of August 31, 1994, as modified and amended.
Transfer and Registration Agreement among United States Filter Corporation, Xxxx
Xxxxxxx Capital Growth Fund IIB Limited Partnership, Xxxx Xxxxxxx Capital
Growth Fund III Limited Partnership, Xxxx X. Xxxxxxxxx, Trustee and The
Black Xxxxxxx Company dated as of May 31, 1996.
Transfer and Registration Agreement among United States Filter Corporation, CGW
Southeast Partners II, L.P., Xxxxx X. Xxxxxxx, Xxxxxx Xxxxxx and Xxxxxxxx
X. Xxxxxxxxx, dated as of October 25, 1996.
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