Exhibit (d)(3)
Execution Copy
REGISTRATION RIGHTS AGREEMENT
FOR
COMMON STOCK
Dated March 10, 2000
by and among
DELCO REMY INTERNATIONAL, INC.,
XXXXXXX XXXXX
and
XXXXXXXX XXXXX
REGISTRATION RIGHTS AGREEMENT FOR COMMON STOCK
This Registration Rights Agreement for Common Stock (the "Agreement") is
made and entered into March 10, 2000 by and among Delco Remy International,
Inc., a Delaware corporation (the "Company"), Xxxxxxx Xxxxx and Xxxxxxxx Xxxxx
(together with Xxxxxxx Xxxxx, "Xxxxx"). Xxxxx is sometimes referred to herein
collectively as the "Investors" and each individually as the "Investor".
This Agreement is made pursuant to the Xxxxx Stock Purchase Agreement (as
hereinafter defined). In order to induce Xxxxx to enter into the Xxxxx Stock
Purchase Agreement, the Company has agreed to provide the registration rights
set forth in this Agreement.
The parties hereby agree as follows:
1. Definitions.
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As used in this Agreement, the following capitalized terms shall have the
following meanings:
"Commission" means the Securities and Exchange Commission.
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"Closing Date" means the date of this Agreement.
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"Common Stock" means the Class A Common Stock, par value $.01 per share, of
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the Company, including shares of Class A Common Stock issuable upon the
conversion of shares of Class B Common Stock, par value $.01 per share, and
shares of Class A Common Stock issuable upon the exercise of the Warrant, and as
adjusted for any stock dividend or distribution payable thereon or stock split,
reverse stock split, recapitalization, reclassification, reorganization,
exchange, subdivision or combination thereof.
"CVC" means Citicorp Venture Capital Ltd., a New York corporation.
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"Demand Registration" has the meaning set forth is Section 4(a) of this
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Agreement.
"Exchange Act" means the Securities Exchange Act of 1934, as amended from
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time to time.
"Xxxxx Stock Purchase Agreement" means the Stock Purchase Agreement by and
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among Reman Holdings, Inc., M&M Xxxxx Auto Parts, Inc., Xxxxxxx Xxxxx, Xxxxxxxx
Xxxxx and Xxxxxxx Xxxxx dated the date hereof.
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"1994 Registration Rights Agreement" means the Registration Rights
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Agreement for Common Stock dated July 29, 1994 by and among the Company, CVC,
WEP, MASG Disposition, Inc. (formerly Mascotech Automotive Systems Group, Inc.),
Xxxxxx X. Xxxxxxxx, Xxxxx X. Xxxxxxx and the Management Investor parties
thereto.
"Person" means an individual, partnership, corporation, trust or
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unincorporated organization, or a government or agency or political subdivision
thereof.
"Prospectus" means the prospectus included in any Registration Statement,
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as amended or supplemented by any prospectus supplement with respect to the
terms of the offering of any portion of the Registrable Securities covered by
such Registration Statement and all other amendments and supplements to the
Prospectus, including post-effective amendments, and all material incorporated
by reference in such Prospectus.
"Registration Expenses" means the costs and expenses of all registrations
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and qualifications under the Securities Act, and of all other actions the
Company is required to take in order to effect the registration of Registrable
Securities under the Securities Act pursuant to this Agreement (including all
federal and state registration and filing fees, printing expenses, fees and
disbursements of counsel for the Company and the fees and expenses of the
Company's independent public accountants (including the expenses of any special
audit and "cold comfort" letters required by or incident to such registration))
other than the costs and expenses of any Investors whose Registrable Securities
are to be registered pursuant to this Agreement comprising underwriters'
commissions, brokerage fees, transfer taxes or the fees and expenses of any
accountants or other representatives retained by any Investor.
"Registration Statement" means any registration statement of the Company
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which covers any of the Registrable Securities pursuant to the provisions of
this Agreement, including the Prospectus, amendments and supplements to such
Registration Statement, including post-effective amendments, all exhibits and
all material incorporated by reference in such Registration Statement.
"Registrable Securities" has the meaning set forth in Section 2 of this
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Agreement.
"Securities Act" means the Securities Act of 1933, as amended from time to
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time.
"Special Registration Statement" means (i) a registration statement on
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Forms S-8 or S-4 or any similar or successor form or any other registration
statement relating to an exchange offer or an offering of securities solely to
the Company's employees or security holders or (ii) a registration statement
registering a Unit Offering.
"Unit Offering" means a public offering of a combination of debt and equity
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securities of the Company in which (i) not more than 20% of the gross proceeds
received for the sale of such securities is attributed to such equity
securities, and (ii) after giving effect to such offering, the Company does not
have a class of equity securities required to be registered under the Exchange
Act.
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"underwritten registration or underwritten offering" means a registration
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in which securities of the Company are sold to an underwriter for reoffering to
the public.
"Warrant" means the warrant exercisable for shares of Class A Common Stock
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of the Company issued pursuant to the Warrant Agreement dated the original date
hereof between WEP and the Company.
"WEP" means World Equity Partners, L.P., a Delaware limited partnership.
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2. Registrable Securities. The securities entitled to the benefits of
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this Agreement are the Registrable Securities. As used herein, "Registrable
Securities" means the shares of Common Stock that are issued (or issuable) and
outstanding on July 29, 1994 and the shares of Common Stock that become issued
(or issuable) and outstanding after July 29, 1994, provided, however, that each
such share of Common Stock shall cease to be a Registrable Security when (i) it
has been effectively registered under the Securities Act and disposed of in
accordance with the registration statement covering it; (ii) it is distributed
to the public pursuant to Rule 144 (or any similar provisions then in force)
under the Securities Act; or (iii) it has otherwise been transferred and a new
certificate or other evidence of ownership for it not bearing a legend based on
the requirements of the Securities Act and not subject to any stop transfer
order has been delivered by or on behalf of the Company and no other restriction
on transfer exists under the Securities Act.
3. Incidental Registration.
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(a) Right to Include Common Stock. If the Company at any time
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proposes to register any of its Common Stock under the Securities Act (other
than on a Special Registration Statement), whether or not for sale for its own
account, it will each such time give at least 30 days prior written notice to
all holders of Registrable Securities of its intention to file a registration
statement under the Securities Act and of such holders' rights under this
Section 3. Upon the written request of any such holders of Registrable
Securities made prior to the proposed filing date (which request shall specify
the intended method of disposition thereof), the Company will effect the
registration under the Securities Act of all Registrable Securities which the
Company has been so requested to register by the holders thereof (an "Incidental
Registration"), to the extent required to permit the public disposition (in
accordance with such intended methods thereof) of the Registrable Securities to
be so registered; provided, that (i) if, any time after giving written notice of
its intention to register shares of Common Stock 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 register the Company's Common
Stock, the Company shall 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); (ii) if a registration requested pursuant to this Section
3 shall involve an underwritten public offering, any holder of Registrable
Securities requesting to be included in such registration may elect, in writing
at least 30 days prior to the effective date of the registration statement filed
in connection with such registration, not to register such securities in
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connection with such registration; and (iii) if, at any time after the 180-day
or shorter period specified in Section 5(b), the sale of the securities has not
been completed, the Company may withdraw from the registration on a pro rata
basis (based on the number of Registrable Securities requested by each holder of
Registrable Securities to be so registered) the Registrable Securities which the
Company has been requested to register and which have not been sold.
(b) Priority in Incidental Registrations. If a registration pursuant
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to Section 3(a) involves an underwritten offering and the managing underwriter
advises the Company in writing that, in its opinion, the total number of shares
of Common Stock to be included in such registration, including the Registrable
Securities requested to be included pursuant to this Section 3, exceeds the
maximum number of shares of Common Stock specified by the managing underwriter
that may be distributed without adversely affecting the price, timing or
distribution of such shares of Common Stock, then the Company shall include in
such registration only such maximum number of Registrable Securities which, in
the reasonable opinion of such underwriter or underwriters, can be sold in the
following order of priority: (i) first, all of the shares of Common Stock that
the Company proposes to sell for its own account, if any, (ii) second, all of
the shares of Common Stock being registered by holder(s) of Registrable
Securities pursuant to a Demand Registration (as hereinafter defined), and (iii)
third, the Registrable Securities of the holder(s) of Registrable Securities
requested to be included in such Incidental Registration. To the extent that
shares of Common Stock to be included in the Incidental Registration must be
allocated among the holders(s) of Registrable Securities pursuant to clause
(iii) above, such shares shall be allocated pro rata among the holders(s) of
Registrable Securities based on the number of shares of Common Stock that such
holder(s) of Registrable Securities shall have requested to be included therein;
provided, however, that (other than with respect to holders of Registrable
Securities that are entitled to make a Demand Registration Request (as
hereinafter defined)) if an Incidental Registration is an underwritten offering,
the managing underwriter or underwriters may select shares for inclusion in such
Incidental Registration on a basis other than a pro rata basis if, in the
reasonable opinion of such underwriter or underwriters, selection on such other
basis would be material to the success of the offering.
(c) Expenses. The Company will pay all Registration Expenses in
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connection with any registration of Registrable Securities requested pursuant to
this Section 3.
(d) Liability for Delay. The Company shall not be held responsible
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for any delay in the filing or processing of a registration statement which
includes any Registrable Securities due to requests by holders of Registrable
Securities pursuant to this Section 3 nor for any delay in requesting the
effectiveness of such registration statement if the Company advises the holders
of Registrable Securities participating in such registration in writing that, in
the opinion of its Board of Directors, such delay is warranted by market
conditions or business considerations.
(e) Participation in Underwritten Registrations. No holder of
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Registrable Securities may participate in any underwritten registration
hereunder unless such holder (i) agrees to sell his or its Common Stock on the
basis provided in any underwriting arrangements
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approved by the persons who have selected the underwriter and (ii) accurately
completes in a timely manner and executes all questionnaires, powers of
attorney, underwriting agreements and other documents customarily required under
the terms of such underwriting arrangements.
4. Demand Registration.
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(a) Right to Demand Registration. Subject to Section 4(b) below,
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Xxxxx shall be entitled to make a written request ("Demand Registration
Request") to the Company for registration with the Commission under and in
accordance with the provisions of the Securities Act of all or part of the
Registrable Securities owned by it (a "Demand Registration") (which Demand
Registration Request shall specify the intended number of Registrable Securities
to be disposed of by such holder and the intended method of disposition
thereof); provided, that (i) the Company may, if the Board of Directors so
determines in the exercise of its reasonable judgment that due to a pending or
contemplated acquisition or disposition or public offering it would be
inadvisable to effect such Demand Registration at such time, defer such Demand
Registration for a single period not to exceed 180 days, and (ii) if the Company
elects not to effect the Demand Registration pursuant to the terms of this
sentence, no Demand Registration shall be deemed to have occurred for purposes
of this Agreement. Within 10 days after receipt of the Demand Registration
Request, the Company will serve written notice (the "Notice") of such Demand
Registration Request to all holders of Registrable Securities and, subject to
paragraph (c) below, the Company will include in such registration all
Registrable Securities of such holders with respect to which the Company has
received written requests for inclusion therein from such holders within fifteen
(15) business days after the receipt by the applicable holder of the Notice. All
requests made pursuant to this paragraph 4(a) will specify the aggregate number
of the Registrable Securities to be registered and will also specify the
intended methods of disposition thereof.
(b) Number of Demand Registrations. Xxxxx shall be entitled to make
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one Demand Registration Request, but only if the fair market value of the shares
of Common Stock held by Xxxxx, together, if requested by Xxxxx, with any shares
of Common Stock included in such Demand Registration by CVC and/or the holders
of Registrable Securities held by WEP on July 29, 1994 as provided in the 1994
Registration Rights Agreement, that shall have been sold publicly pursuant to an
effective registration statement under the Securities Act and/or pursuant to
Rule 144 will be, at the time of the sale of Registrable Securities pursuant to
such Demand Registration, at least equal to $20,000,000. In the case of a Demand
Registration Request made by Xxxxx, such Demand Registration shall not be
counted as a Demand Registration hereunder until such Demand Registration has
been declared effective and maintained continuously effective for a period of at
least three months or such shorter period when all Registrable Securities
included therein have been sold in accordance with such Demand Registration.
(c) Priority on Demand Registration. If any of the Registrable
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Securities proposed to be registered pursuant to a Demand Registration are to be
sold in a firm commitment underwritten offering and the managing underwriter or
underwriters of a Demand Registration advise the Company and the holders of such
Registrable Securities in writing that in its or their
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reasonable opinion the number of shares of Common Stock proposed to be sold in
such Demand Registration exceeds the maximum number of shares specified by the
managing underwriter that may be distributed without adversely affecting the
price, timing or distribution of the Common Stock, the Company shall include in
such registration only such maximum number of Registrable Securities which, in
the reasonable opinion of such underwriter or underwriters can be sold in the
following order of priority: (i) first, the Registrable Securities requested to
be included in such Demand Registration held by the party requesting such Demand
Registration (provided that, in the case of a Demand Registration Request made
by Xxxxx, such amount shall be allocated among the Xxxxx holders, and, if
requested by Xxxxx to be included in such Demand Registration, CVC and the
holders of Registrable Securities held by WEP on a pro rata basis based upon the
number of Registrable Securities requested to be included by such Xxxxx holders
in such Demand Registration); (ii) second, shares of Common Stock to be offered
by the Company in such Demand Registration; and (iii) third, shares of Common
Stock held by other holders requested to be included in such Demand
Registration, provided that such amount shall be allocated among such other
holders on a pro rata basis based upon their respective percentage of ownership
of the total number of shares of Common Stock then outstanding.
(d) Expenses. The Company will pay all Registration Expenses in
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connection with any registration of Registrable Securities requested pursuant to
this Section 4.
5. Registration Procedures. If and whenever the Company is required
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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:
(a) prepare and file with the Commission 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 Sections 3 or 4 herein at any time prior to the effective
date of the registration statement relating thereto;
(b) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement effective for
a period of not less than (i) 180 days in the case of a registration of
Registrable Securities pursuant to Section 3 hereof, or (ii) 90 days in the case
of a registration of Registrable Securities pursuant to Section 4 hereof, or
(iii) such shorter period which will terminate when all Registrable Securities
covered by such registration statement have been sold (but not before the
expiration of the 90-day period referred to in Section 4(3) of the Securities
Act and Rule 174 thereunder, if applicable) and 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;
(c) furnish to each seller of such Registrable Securities such number
of copies of such registration statement and of each such amendment and
supplement thereof (in each case including all exhibits), such number of copies
of the prospectus included in such registration
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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;
(d) 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 request, and do any and
all other acts and things which may be necessary or advisable to enable such
seller to consummate the disposition in such jurisdictions of the Registrable
Securities owned by such seller; provided, however, that the Company shall not
be required to qualify generally to do business in any jurisdiction where it is
not then so qualified or to take any action which would subject it to general
service of process in any such jurisdiction where it is not then so subject or
subject itself to general taxation in any jurisdiction where it is not then so
subject;
(e) immediately notify each seller of any Registrable Securities
covered by such registration statement, at any time when a prospectus relating
thereto is required to be delivered under the Act within the appropriate period
mentioned in clause (b) of this Section 5, of the Company 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 within ten
days prepare and furnish to all sellers 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;
(f) use its best efforts to list such Registrable Securities on any
securities exchange on which the Common Stock is 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 provide an independent transfer
agent and registrar for such Registrable Securities covered by such registration
statement not later than the effective date of such registration statement;
(g) cooperate with each seller of Registrable Securities and the
underwriters, if any, to facilitate the timely preparation and delivery of
certificates representing Registrable Securities to be sold and not bearing any
restrictive legend; and enable such Registrable Securities to be in such
denominations and registered in such names as the holders of Registrable
Securities or the underwriters, if any, may request at least two business days
prior to any sale of Registrable Securities made by such underwriter;
(h) furnish to each seller of Registrable Securities covered by such
registration statement a signed counterpart, addressed to such seller (and the
underwriters, if any) of:
(i) an opinion of counsel for the Company, dated the effective
date of such registration statement (or, if such registration involves an
underwritten public
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offering, dated the date of the closing under the underwriting agreement),
reasonably satisfactory in form and substance to the sellers of not less than
50% of such Registrable Securities (and the managing underwriter, if any); and
(ii) a "comfort" letter, dated the effective date of such
registration statement (or, if such registration involves an underwritten
public offering, dated the date of the closing under the underwriting
agreement), signed by the independent public accountants who have certified
the Company's financial statements included in such registration statement,
covering such matters with respect to such registration statement as are
customarily covered in accountants' letters delivered to the underwriters
in underwritten offerings of securities as may reasonably be requested by
the sellers of not less than 50% of such Registrable Securities (and the
managing underwriter, if any); and
(i) 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 (individually, an "Inspector" and collectively,
the "Inspectors"), all pertinent financial and other records, pertinent
corporate documents and properties of the Company as shall be reasonably
necessary to enable them to exercise their due diligence responsibility
(collectively, the "Records"), 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; provided that any Records that are designated by the
Company in writing as confidential shall be kept confidential by the Inspectors
unless (A) the disclosure of such Records is necessary to avoid or correct a
misstatement or omission in such registration statement or (B) the release of
such Records is ordered pursuant to a subpoena or other order from a court of
competent jurisdiction or by any regulatory authority having jurisdiction. Each
Investor agrees that non-public information obtained by it as a result of such
Inspections shall be deemed confidential and acknowledges its obligations under
the Federal securities laws not to trade any securities of the Company on the
basis of material non-public information.
The Company may require each seller of Registrable Securities as to which
any registration is being effected promptly to furnish to the Company such
information regarding the distribution of such Registrable Securities as may be
legally required. Such information shall be furnished in writing and shall state
that it is being furnished for use in the registration statement.
Each holder of Registrable Securities agrees by acquisition of such
Registrable Securities that, upon receipt of any notice from the Company of the
happening of any event of the kind described in clause (e) 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 (e) 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
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at the time of receipt of the Company's notice. In the event the Company shall
give any such notice, the period mentioned in clause (b) 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 (e) 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 (e) of this Section 5.
To the extent not inconsistent with applicable law, each holder of
Registrable Securities whose Common Stock is included in a registration
statement hereunder, if requested by the managing underwriter or underwriters
for such registration, agrees not to effect any public sale or distribution of
Registrable Securities, including a sale pursuant to Rule 144 (or any similar
provision then in force) under the Securities Act, during the fifteen business
days prior to, and during the ninety-day period (or such shorter period as may
be agreed to by such holders) beginning on, the effective date of a demand
registration statement.
6. Indemnification.
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(a) Indemnification by the Company. The Company hereby agrees to
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indemnify and hold harmless each holder of Registrable Securities which shall
have been registered under the Securities Act, and such holder's officers,
directors and agents and each other Person, if any, who controls such holder
within the meaning of the Securities Act and each other Person (including
underwriters) who participates in the offering of such Registrable Securities
against any losses, claims, damages, liabilities, reasonable attorneys' fees,
costs or expenses (collectively, the "Damages"), joint or several, to which such
holder or controlling Person or participating Person may become subject under
the Securities Act or otherwise, insofar as such Damages (or proceedings in
respect thereof) arise out of or are based upon any untrue statement or alleged
untrue statement of any material fact made by the Company or its agents
contained in any registration statement under which such Registrable Securities
are registered under the Securities Act, in any preliminary prospectus or final
prospectus contained therein, or in any amendment or supplement thereof, or
arise out of or are based upon the 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 such holder of Registrable
Securities or such controlling Person or participating Person in connection with
investigating or defending any such Damages or proceeding; provided, however,
that the Company will not be liable in any such case to the extent that any such
Damages arise out of or are based upon (i) an untrue statement or alleged untrue
statement or omission or alleged omission made in such registration statement,
said preliminary or final prospectus or said amendment or supplement in reliance
upon and in conformity with written information furnished to the Company by such
holder or such controlling or participating Person, as the case may be,
specifically for use in the preparation thereof; or (ii) an untrue statement or
alleged untrue statement, omission or alleged omission in a prospectus if such
untrue statement or alleged untrue statement, omission or alleged omission is
corrected in an amendment or supplement to the prospectus which amendment or
supplement is delivered to such holder in a timely manner and such holder
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thereafter fails to deliver such prospectus as so amended or supplemented prior
to or concurrently with the sale of such Registrable Securities to the Person
asserting such Damages.
(b) Indemnification by the Holders of Registrable Securities Which
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Are Registered. It shall be a condition of the Company's obligations under this
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Agreement to effect any registration under the Securities Act that there shall
have been delivered to the Company an agreement or agreements duly executed by
each holder of Registrable Securities to be so registered, whereby such holder
agrees to indemnify and hold harmless the Company, its directors, officers and
agents and each other Person, if any, which controls the Company within the
meaning of the Securities Act against any Damages, joint or several, to which
the Company, or such other Person or such Person controlling the Company may
become subject under the Securities Act or otherwise, but only to the extent
that such Damages (or proceedings in respect thereof) arise out of or are based
upon any untrue statements or alleged untrue statement of any material fact
contained, on the effective date thereof, in any registration statement under
which such Registrable Securities are registered under the Securities Act, in
any preliminary prospectus or final prospectus contained therein or in any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, which, in
each such case, has been made in or omitted from such registration statement,
said preliminary or final prospectus or said amendment or supplement in reliance
upon, and in conformity with, written information furnished to the Company by
such holder of Registrable Securities specifically for use in the preparation
thereof. The Company shall be entitled to receive indemnities from underwriters,
selling brokers, dealer managers and similar securities industry professionals
participating in the distribution, to the same extent as provided above, with
respect to information with to such Persons so furnished in writing by such
Persons specifically for inclusion in any prospectus or registration statement.
(c) Conduct of Indemnification Proceedings. Any Person entitled to
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indemnification hereunder shall (i) give prompt written notice to the
indemnifying party of the commencement of any action or proceeding involving a
claim referred to in the preceding paragraphs of this Section 6; and (ii) unless
the indemnified party has been advised by its counsel that a conflict of
interest exists between such indemnified and indemnifying parties under
applicable standards of professional responsibility, with respect to such claim,
permit such indemnifying party to assume the defense of such claim with counsel
reasonably satisfactory to the indemnified party. Whether or not such defense is
assumed by the indemnifying party, the indemnifying party will not be subject to
any liability for any settlement made without its consent (but such consent will
not be unreasonably withheld). No indemnifying party will consent to the 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 of such claim or
litigation; provided, however, that no indemnifying party will consent to the
entry of any judgment or enter into any settlement (other than for the payment
of money only) without the consent of the indemnified party (which consent will
not be unreasonably withheld). An indemnifying party who is not entitled to, or
elects not to, assume the defense of the claim, will not be obligated to pay the
fees and expenses
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of more than one counsel for all parties indemnified by such indemnifying party
with respect to such claim, unless in the reasonable judgment of any indemnified
party a conflict of interest may exist between such indemnified party and any
other such indemnified parties with respect to such claim, in which event the
indemnifying party shall be obligated to pay the fees and expenses of such
additional counsel or counsels.
(d) Contribution. If for any reason the indemnification provided for
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in the preceding Sections 6 (a) or 6 (b) is unavailable to an indemnified party
in respect of any Damages referred to therein, the indemnifying party shall
contribute to the amount paid or payable by the indemnified party as a result of
such Damages in such proportion as is appropriate to reflect not only the
relative benefits received by the indemnified party and the indemnifying party,
but also the relative fault of the indemnified party and the indemnifying party,
as well as any other relevant equitable considerations. The relative fault of
such indemnifying party and indemnified parties shall be determined by reference
to, among other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact, has been made by, or relates to information supplied by,
such indemnifying party or indemnified parties, and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such action; provided, however, that in no event shall the liability of any
selling holder of Registrable Securities hereunder be greater in amount than the
difference between the dollar amount of the proceeds received by such holder
upon the sale of the Registrable Securities giving rise to such contribution
obligation and all amounts previously contributed by such holder with respect to
such Damages. No Person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Securities Act) shall be entitled to
contribution from any Person who was not guilty of fraudulent misrepresentation.
7. Hold-Back Agreements.
--------------------
(a) Restrictions on Public Sale by Holder of Registrable Securities.
---------------------------------------------------------------
Each holder of Registrable Securities whose Registrable Securities are eligible
for inclusion in a Registration Statement filed pursuant to Sections 3 or 4
agrees, if requested by the managing underwriter or underwriters in an
underwritten offering of any Registrable Securities, not to effect any public
sale or distribution of Registrable Securities, including a sale pursuant to
Rule 144 (or any similar provision then in force) under the Securities Act
(except as part of such underwritten registration), during the 10-day period
prior to, and during the 90-day period (or such shorter period as may be agreed
to by the parties hereto) beginning on the effective date of such Registration
Statement, to the extent timely notified in writing by the Company or the
managing underwriter or underwriters.
The foregoing provisions shall not apply to any holder of Registrable
Securities if such holder is prevented by applicable statute or regulation from
entering into any such agreement; provided, however, that any such holder shall
undertake, in its request to participate in any such underwritten offering, not
to effect any public sale or distribution of Registrable Securities (except as
part of such underwritten registration) during such period unless it has
provided 45 days prior written notice of such sale or distribution to the
managing underwriter or underwriter.
11
(b) Restrictions on Public Sale by the Company and Others. The
-----------------------------------------------------
Company agrees (i) not to effect any public sale or distribution of any of its
Common Stock for its own account during the 10-day period prior to, and during
the 90-day period beginning on, the effective date of a Registration Statement
filed pursuant to Sections 3 or 4 (except as part of a Special Registration
Statement), and (ii) use reasonable efforts to cause each holder of Common Stock
purchased from the Company at any time after the original date of this Agreement
(other than in a registered public offering) to agree not to effect any public
sale or distribution of any such securities during such period, including a sale
pursuant to Rule 144 under the Securities Act (except as part of such
underwritten registration, if permitted).
8. Underwritten Registration.
-------------------------
If any of the Registrable Securities covered by any Incidental Registration
are to be sold in an underwritten offering, the investment banker or investment
bankers and manager or managers that will administer the offering will be
selected by the Company and, in the case of a Demand Registration, approved by
CVC.
Notwithstanding anything herein to the contrary, no Person may participate
in any underwritten registration hereunder unless such Person (a) agrees to sell
such Person's securities on the basis provided in any underwritten arrangements
approved by the Persons entitled hereunder to approve such arrangement and (b)
accurately completes and executes all questionnaires, powers of attorney,
indemnities, custody agreements, underwriting agreements and other documents
required under the terms of such underwriting arrangements.
9. Miscellaneous.
-------------
(a) Amendment and Modification. This Agreement may be amended or
--------------------------
modified, or any provision hereof may be waived, provided that such amendment or
waiver is set forth in a writing executed by (i) the Company, (ii) the holders
of a majority of the shares of the Registrable Securities held by Xxxxx. No
course of dealing between or among any persons having any interest in this
Agreement will be deemed effective to modify, amend or discharge any part of
this Agreement or any rights or obligations of any person under or by reason of
this Agreement.
(b) Acknowledgement of Existing Registration Rights. Each of Heywood
-----------------------------------------------
Xxxxx and Xxxxxxxx Xxxxx acknowledges that the Company has granted registration
rights under the 1994 Registration Rights Agreement, a copy of which has been
provided to them.
(c) Survival of Representations and Warranties. All representations,
------------------------------------------
warranties, covenants and agreements set forth in this Agreement will survive
the execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby, regardless of any investigation made by an
Investor or on its behalf.
(d) Successors and Assigns; Entire Agreement. This Agreement and all
----------------------------------------
of the provisions hereof shall be binding upon and inure to the benefit of the
parties hereto and their
12
respective successors and permitted assigns and executors, administrators and
heirs. This Agreement sets forth the entire agreement and understandings among
the parties as to the subject matter hereof and merges and supersedes all prior
discussions and understandings of any and every nature among them.
(e) Separability. In the event that any provision of this Agreement
------------
or the application of any provision hereof is declared to be illegal, invalid or
otherwise unenforceable by a court of competent jurisdiction, the remainder of
this Agreement shall not be affected except to the extent necessary to delete
such illegal, invalid or unenforceable provision unless that provision held
invalid shall substantially impair the benefits of the remaining portions of
this Agreement.
(f) Notices. All notices provided for or permitted hereunder shall
-------
be made in writing by hand-delivery, registered or certified first-class mail,
telex, telecopier or air courier guaranteeing overnight delivery to the other
party at the following addresses (or at such other address as shall be given in
writing by any party to the others):
If to the Company to:
Delco Remy International, Inc.
0000 Xxxxxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxx 00000
Fax: (000) 000-0000
Attention: President and General Counsel
with a required copy to:
Dechert Price & Xxxxxx
4000 Xxxx Atlantic Tower
0000 Xxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attention: G. Xxxxxx X'Xxxxxxx, Esquire
If to Xxxxx to:
M&M Xxxxx Auto Parts, Inc.
000 Xxx Xxx Xxxxxxxxx Xx.
Xxxxxxxxxx, XX
Fax: (000) 000-0000
Attention: Xxxxxxx Xxxxx
Xxxxxxxx Xxxxx
13
with a required copy to:
Greenbaum, Rowe, Xxxxx, Xxxxx,
Xxxxx & Xxxxxx LLP
Metro Corporate Campus One
X.X. Xxx 0000
Xxxxxxxxxx, XX 00000
Fax: (000) 000-0000
Attention: Xxxx Xxxxx, Esquire
All such notices shall be deemed to have been duly given: when delivered by
hand, if personally delivered; five business days after being deposited in the
mail, postage prepaid, if mailed; when answered back, if telexed; when receipt
acknowledged, if telecopied; and on the next business day, if timely delivered
to an air courier guaranteeing overnight delivery.
(g) Governing Law. The validity, performance, construction and effect
-------------
of this Agreement shall be governed by and construed in accordance with the
internal law of Delaware, without giving effect to principles of conflicts of
law.
(h) Headings. The headings in this Agreement are for convenience of
--------
reference only and shall not constitute a part of this Agreement, nor shall they
affect their meaning, construction or effect.
(i) Counterparts. This Agreement may be executed in two or more
------------
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original, and all of which taken
together shall constitute one and the same instrument.
(j) Further Assurances. Each party shall cooperate and take such
------------------
action as may be reasonably requested by another party in order to carry out the
provisions and purposes of this Agreement and the transactions contemplated
hereby.
(k) Termination. Unless sooner terminated in accordance with its
-----------
terms, this Agreement shall terminate on the fifteenth anniversary of July 29,
1994; provided that the indemnification rights and obligations set forth in
Section 6 hereof shall survive the termination of this Agreement.
(l) Remedies. In the event of a breach or a threatened breach by any
--------
party to this Agreement of its obligations under this Agreement, any party
injured or to be injured by such breach, in addition to being entitled to
exercise all rights granted by law, including recovery of damages, will be
entitled to specific performance of its rights under this Agreement, it being
agreed by the parties that the remedy at law, including monetary damages, for
breach of such provision will be inadequate compensation for any loss and that
any defense in any action for specific performance that a remedy at law would be
adequate is waived.
14
(m) Party No Longer Owning Securities. If a party hereto ceases to
---------------------------------
own any Securities, such party will no longer be deemed to be an Investor for
purposes of this Agreement; provided that the indemnification rights and
obligations set forth in Section 6 hereof shall survive any such cessation of
ownership.
(n) Pronouns. Whenever the context may require, any pronouns used
--------
herein shall be deemed also to include the corresponding neuter, masculine or
feminine forms.
(o) No Effect on Employment. Nothing herein contained shall confer on
-----------------------
any investor the right to remain in the employ of the Company or any of its
subsidiaries or Affiliates.
15
IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.
DELCO REMY INTERNATIONAL, INC.
By: /s/ Xxxxxx X. Xxxxxx
--------------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: President and Chief Executive Officer
/s/ Xxxxxxx Xxxxx
-------------------------------------------------
Xxxxxxx Xxxxx
/s/ Xxxxxxxx Xxxxx
-------------------------------------------------
Xxxxxxxx Xxxxx
16
ACKNOWLEDGMENT AND AGREEMENT
----------------------------
Each of Citicorp Venture Capital Ltd. ("CVC") and World Equity
Partners, L.P. ("WEP") hereby acknowledges and agrees to the grant by Delco
Remy International, Inc. of registration rights under that certain Registration
Rights Agreement for Common Stock by and among Delco Remy International, Inc.,
Xxxxxxx Xxxxx and Xxxxxxxx Xxxxx dated March 10, 2000, a copy of which has been
provided to CVC and WEP.
CITICORP VENTURE CAPITAL LTD.
/s/ Xxxxxxx Xxxxxxx
-----------------------------
By:
Title:
WORLD EQUITY PARTNERS, L.P.
/s/ ILLEGIBLE
-----------------------------
By:
Title:
17
