1
EXHIBIT 10.3
RANGER AEROSPACE CORPORATION
SECURITYHOLDERS AGREEMENT
THIS AGREEMENT is made as of April 1, 1998 between Ranger
Aerospace Corporation, a Delaware corporation (the "Company"), Xxxx Xxxxxxx
Mutual Life Insurance Company ("Xxxxxxx"), CIBC Wood Gundy Ventures, Inc.
("CIBC"), Xxxx X. Xxxxxxx, M.D., Trustee of the Xxxxxxxx Xxxxxxxx Trust UAD
10/1/93, and each other Person designated as an Investor on the Schedule of
Securityholders attached hereto (collectively, the "Investors") and each Person
designated as an Executive on the Schedule of Securityholders attached hereto
(the "Executives"). The Investors and the Executives are collectively referred
to as the "Securityholders" and individually as a "Securityholder." Capitalized
terms used herein and not otherwise defined are defined in paragraph 9 hereof.
Xxxxxxx is purchasing Notes and Common Stock and certain other
Investors are purchasing Common Stock and Preferred Stock, pursuant to a
Securities Purchase Agreement dated as of the date hereof between the Company
and the Persons named therein (the "Securities Purchase Agreement"). The Company
and each other Securityholder are parties to either an Executive Stock Agreement
or an Investor Stock Agreement (each, an "Executive Stock Agreement"), pursuant
to which such Person shall purchase Securities of the Company as set forth on
the Schedule of Securityholders attached hereto.
The Company and the Securityholders desire to enter into this
Agreement for the purposes, among others, of (i) establishing the composition of
the Company's Board of Directors (the "Board"), (ii) assuring continuity in the
management and ownership of the Company and (iii) limiting the manner and terms
by which the Securityholders' Securities may be transferred. The execution and
delivery of this Agreement is a condition to the Investors' obligation to
purchase Securities of the Company pursuant to the Securities Purchase
Agreement.
NOW, THEREFORE, in consideration of the mutual covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties to this Agreement
hereby agree as follows:
1. Board of Directors.
(a) Election of Directors. From and after the Closing (as
defined in the Securities Purchase Agreement) and until the provisions of this
paragraph 1 cease to be effective, each holder of Securityholder Securities
shall vote all of his or its Securityholder Securities which are voting shares
and any other voting securities of the Company over which such holder has voting
control and shall take all other reasonably necessary or desirable actions
within his or its control (whether in his or its capacity as a Securityholder,
director, member of a board committee or officer of the Company or otherwise,
and including, without limitation, attendance at meetings in person or by proxy
for
2
purposes of obtaining a quorum and execution of written consents in lieu of
meetings), and the Company shall take all reasonably necessary or desirable
actions within its control (including, without limitation, calling special board
and stockholder meetings), so that:
(i) the authorized number of directors on the Board shall
be established at six (6) directors;
(ii) the following individuals shall be elected to the
Board:
(A) two (2) representatives designated by Xxxxxxx
(the "Xxxxxxx Directors");
(B) two (2) representatives designated by CIBC (the
"CIBC Directors");
(C) two (2) representatives jointly designated by
Xxxxxxx and CIBC (the "Executive Directors"); provided that such
Executive Directors shall be executive officers or employees of
the Company; provided further, that until their earlier
resignation or removal, Xxxxxxx X. Xxxxxx and Xxxxxx Xxxxxxxx
shall serve as Executive Directors;
(iii) the composition of the board of directors of each of
the Company's Subsidiaries (a "Sub Board") shall be determined by the
Board; provided that Xxxxxx Xxxxxxxx shall serve as a director of
ASIG;
(iv) any committees of the Board or a Sub Board shall be
created only upon the approval of a majority of the members of the
Board and the composition of each such committee (if any) shall be
determined by the Board;
(v) the removal from the Board (with or without cause)
of any representative designated pursuant to subparagraph (a)(ii)
above shall be at the written request of the party entitled to
designate such representative and under no other circumstance;
provided that if any director elected pursuant to subparagraph (ii)(C)
above ceases to be an employee of the Company and its Subsidiaries
(or, in the case of Xxxxxx Xxxxxxxx, Chairman) he may be removed as a
director at any time thereafter at the option of the Investors
(determined on the basis of a vote of the holders of a majority of the
Voting Power possessed by the Investors); and
(vi) in the event that any representative designated
pursuant to subparagraph (a)(ii) above ceases to serve as a member of
the Board during his term of office, the resulting vacancy shall be
filled by a representative designated by the party entitled to
designate such representative.
- 2 -
3
(b) Director Expenses. The Company shall pay the reasonable
out-of-pocket expenses incurred by each director in connection with attending
the meetings of the Board, any Sub Board and any committee thereof.
(c) Termination of Rights of Investors. The rights of any
Investor entitled to designate any representative pursuant to subparagraph
(a)(ii) above shall terminate at such time as such Investor and its Permitted
Transferees hold in the aggregate less than 50% of the Securityholder Securities
held by such Persons on the date hereof.
(d) Termination of Rights of Executives. The rights of the
Executives under this paragraph 1 shall terminate at such time as the Executives
and their Permitted Transferees hold in the aggregate less than 50% of the
Securityholder Securities held by such Persons on the date hereof.
(e) Termination of Provisions. The provisions of this
paragraph 1 shall terminate automatically and be of no further force and effect
upon the first to occur of (i) the tenth anniversary of the date hereof unless
extended by the holders of at least 75% of the Voting Power held by all
Securityholders or (ii) a Qualified Public Offering.
(f) Failure to Designate. If any party fails to designate a
representative to fill a directorship pursuant to the terms of this paragraph 1,
the individual previously holding such directorship shall be elected to such
position, or if such individual fails or declines to serve as a director, such
directorship shall remain vacant until the resulting vacancy is filled by a
representative designated by the party entitled to designate such representative
pursuant to subparagraph (a)(ii) above.
2. Representations and Warranties. Each Securityholder
represents and warrants that (i) such Securityholder is the record owner of the
number and class of Securityholder Securities set forth opposite its name on the
Schedule of Securityholders attached hereto, (ii) this Agreement has been duly
authorized, executed and delivered by such Securityholder and constitutes the
valid and binding obligation of such Securityholder, enforceable in accordance
with its terms, and (iii) such Securityholder has not granted and is not a party
to any proxy, voting trust or other agreement which is inconsistent with,
conflicts with or violates any provision of this Agreement. No holder of
Securityholder Securities shall grant any proxy or become party to any voting
trust or other agreement which is inconsistent with, conflicts with or violates
any provision of this Agreement.
3. Restrictions on Transfer of Securityholder Securities.
(a) Transfer of Securityholder Securities. No holder of
Securityholder Securities shall sell, transfer, assign, pledge or otherwise
dispose of (whether with or without consideration and whether voluntarily or
involuntarily or by operation of law) any interest in his Securityholder
Securities (a "Transfer"), except pursuant to (i) paragraph 4, (ii) a Public
Sale or (iii) this paragraph 3 (collectively, an "Exempt Transfer"); provided
that in no event shall any Transfer of Securityholder
- 3 -
4
Securities pursuant to this paragraph 3 be made for any consideration other than
cash payable upon consummation of such Transfer or in installments over time and
no Securityholder Securities may be pledged (except for a pledge of
Securityholder Securities pursuant to the Executive Stock Agreements or by a
transferee to secure indebtedness to the transferor or an Affiliate of the
transferor). No holder of Securityholder Securities shall consummate any
Transfer (other than an Exempt Transfer) until 30 days after the later of the
delivery to the Company and the other holders of Securityholder Securities of
such Securityholder's Offer Notice or Sale Notice (if any), unless the parties
to the Transfer have been finally determined pursuant to this paragraph 3 prior
to the expiration of such 30-day period (the "Election Period").
(b) Right of First Refusal At least 30 days prior to making
any Transfer of any Securityholder Securities (other than an Exempt Transfer),
the transferring Securityholder (the "Transferring Securityholder") shall
deliver a written notice (an "Offer Notice") to the Company and the other
Securityholders (the "Other Securityholders"). The Offer Notice shall disclose
in reasonable detail the proposed number of Securityholder Securities to be
transferred (the "Offered Securities"), the proposed terms and conditions of the
Transfer and the identity of the prospective transferee(s) (if known). The
purchase price specified in any Offer Notice shall be payable solely in cash at
the closing of the transaction or in installments over time. The rights under
this paragraph 3(b) shall apply as follows:
(i) First, each Other Securityholder may elect to
purchase all or any portion of the Offered Securities at the price and
on the terms specified in the Offer Notice by delivering written notice
of such election to the Transferring Securityholder as soon as
practical, but in any event within 20 days after delivery of the Offer
Notice; provided that if the Offered Securities include any
Securityholder Securities other than Common Stock, any election to
purchase Common Stock by any Other Securityholder must also include an
election to purchase shares or Preferred Stock or Notes, pro rata based
upon the number of shares of Preferred Stock or principal amount of
Notes included in the Offered Securities. If the Other Securityholders
have in the aggregate elected to purchase more than those Offered
Securities being offered by the Transferring Securityholder, the
Offered Securities shall be allocated among the Other Securityholders
electing to purchase shares pro rata based upon the number of shares
(and/or principal amount of Notes) elected to be purchased.
(ii) Second, if the Other Securityholders have not
elected to purchase all of the Offered Securities within such
twenty-day period, the Company may elect to purchase all (but not less
than all) of the remaining Offered Securities at the price and on the
terms specified in the Offer Notice by delivering written notice of
such election to the Transferring Securityholder as soon as practical
but in any event within 30 days after delivery of the Offer Notice. If
the Company or any Other Securityholders have elected to purchase
Securityholder Securities from the Transferring Securityholder, the
transfer of such securities shall be consummated as soon as practical
after the delivery of the election notice(s) to the Transferring
Securityholder, but in any event within 15 days after the expiration of
the Election Period.
- 4 -
5
(iii) Third, to the extent that the Company and the
Other Securityholders have not elected to purchase all of the Offered
Securities, the Transferring Securityholder may, within 90 days after
the expiration of the Election Period and subject to the provisions of
subparagraph (c) below, transfer the remaining Offered Securities to
one or more third parties at a price no less than 95% of the price
specified in the Offer Notice and on other terms no more favorable to
the transferees thereof than offered to the Company and the Other
Securityholders in the Offer Notice. Any Offered Securities not
transferred within such 90-day period shall be reoffered to the Company
and the Other Securityholders under this paragraph 3(b) prior to any
subsequent Transfer.
(c) Participation Rights. At least 30 days prior to an
Investor making any Transfer of Securityholder Securities (other than an Exempt
Transfer), the Investor making such Transfer (the "Transferring Investor") shall
deliver a written notice (the "Sale Notice") to the Company and the other
Investors (the "Other Investors"), specifying in reasonable detail the identity
of the prospective transferee(s), the class and number of securities to be
transferred and the aggregate price, price per share, terms and conditions of
the Transfer (which notice may be the same notice and given at the same time as
the Offer Notice under paragraph 3(b)). The Other Investors may elect to
participate in the contemplated Transfer at the same price and on the same terms
as the Transferring Investor by delivering written notice to the Transferring
Investors within 30 days after delivery of the Sale Notice, it being understood
that holders of Preferred Stock shall be entitled to participate in any Transfer
(other than an Exempt Transfer) by a Noteholder on a pro rata basis, treating
for purposes of this section the Preferred Stock as Notes, and vice versa
(together, the Notes and the Preferred Stock are the "Senior Securities"). If
any Other Investors have elected to participate in such Transfer, the
Transferring Investor and such Other Investors shall be entitled to sell in the
contemplated Transfer, at the same price and on the same terms, a number of each
class of Securityholder Securities equal to the product of (i) the quotient
determined by dividing the percentage of the class of the Securityholder
Securities owned by such Person by the aggregate percentage of such class of
Securityholder Securities owned by the Transferring Investor and the Other
Investors participating in such sale and (ii) the number of such class of
Securityholder Securities to be sold in the contemplated Transfer. Because Notes
and Preferred Stock must be treated as one and the same class of securities
hereunder, the percentage of Notes and/or Preferred Stock owned by a Person
pursuant to clause (i) above is equal to the quotient determined by dividing (x)
the sum of the Liquidation Value (including accrued but unpaid dividends) of the
Preferred Stock plus the principal amount (together with all accrued but unpaid
interest) of the Notes held by such Person by (y) the sum of the Liquidation
Value (including accrued but unpaid dividends) of all Preferred Stock then
outstanding plus the principal amount (together with all accrued but unpaid
interest) of all Notes then outstanding (such percentage being the "Senior
Security Percentage").
For example, if the Sale Notice contemplated a sale of 100 shares of
Common Stock and 100 shares of Preferred Stock by the Transferring
Investor, and if the Transferring Investor at such time owns 30% of all
shares of Common Stock and has a Senior Security Percentage of 20% and
if two Other Securityholders elect to participate and if the first
Other Securityholder owns 20% of all shares of Common
- 5 -
6
Stock and has a Senior Security Percentage of 5%, and if the second
Other Securityholder owns 10% of all shares of Common Stock and has a
Senior Security Percentage of 0%, the Transferring Investor would be
entitled to sell 50 shares of Common Stock (30% divided by 60% x 100
shares) and that number of Senior Securities, which may be either
Preferred Stock or Notes, the Liquidation Value or principal amount of
which is equal to the Liquidation Value of 80 shares of Preferred Stock
(20% divided by 25% x 100 shares), the first Other Investor would be
entitled to sell 33 1/3 shares of Common Stock (20% divided by 60% x
100 shares) and that number of Senior Securities, which may be either
Preferred Stock or Notes, the Liquidation Value or principal amount of
which is equal to the Liquidation Value of 20 shares of Preferred
Stock, and the second Other Securityholder would be entitled to sell 16
2/3 shares of Common Stock (10% divided by 60% x 100 shares) and no
Senior Securities.
Each Transferring Investor shall use its best efforts to obtain the agreement of
the prospective transferee(s) to the participation of the Other Investors in any
contemplated Transfer, and no Transferring Investor shall transfer any of its
Securityholder Securities to any prospective transferee if such prospective
transferee declines to allow the participation of the Other Investors, it being
understood that transferees must agree to accept Notes in lieu of Preferred
Stock and vice versa. Each Investor transferring Securityholder Securities
pursuant to this paragraph 3(c) shall pay its pro rata share (based on their
share of the aggregate proceeds received) of the expenses incurred by the
Investors in connection with such transfer and shall be obligated to join on a
pro rata basis (based on their share of the aggregate proceeds received) in any
indemnification or other obligations that the Transferring Investor agrees to
provide in connection with such transfer (other than any such obligations that
relate specifically to a particular Investor such as indemnification with
respect to representations and warranties given by an Investor regarding such
Investor's title to and ownership of Securityholder Securities; provided that no
holder shall be obligated in connection with such Transfer to agree to indemnify
or hold harmless the transferee(s) with respect to an amount in excess of the
net cash proceeds paid to such holder in connection with such Transfer).
(d) Permitted Transfers. The restrictions set forth in this
paragraph 3 shall not apply with respect to any Transfer of Securityholder
Securities by any Securityholder (i) in the case of an Executive, pursuant to
applicable laws of descent and distribution or among such Executive's Family
Group or (ii) in the case of an Investor, among its Affiliates (collectively
referred to herein as "Permitted Transferees"). The restrictions applicable to
the Xxxxxxxx Xxxxxxxx Trust under this paragraph 3(d) shall be applied as if
Xxxxxx Xxxxxxxx was an Executive hereunder. For purposes of this Agreement,
"Family Group" means an Executive's spouse and descendants (whether natural or
adopted) and any trust solely for the benefit of, or any partnership,
corporation, limited liability company or other entity which is wholly owned by,
the Executive and/or the Executive's spouse and/or descendants, and "Affiliate"
of an Investor means any other Person, directly or indirectly controlling,
controlled by or under common control with such Investor. A Person shall be
deemed to be "controlled by" an Investor if such Investor possesses, directly or
indirectly, power to direct or cause the direction of the management or policies
of such Person or the disposition of its assets or property, whether by equity
or other ownership, contract, agreement or understanding, or
- 6 -
7
otherwise. For clarity, CIBC WG, Argosy Merchant Fund 1, L.L.C., and any
Affiliate thereof shall be deemed an Affiliate of CIBC hereunder. The
restrictions contained in this paragraph 3 shall continue to be applicable to
the Securityholder Securities after any such Transfer. Notwithstanding anything
contained herein to the contrary, no party hereto shall avoid the provisions of
this Agreement by making one or more transfers to one or more Permitted
Transferees and then disposing of all or any portion of such party's interest in
any such Permitted Transferee.
(e) Termination of Restrictions. The restrictions on the
Transfer of Securityholder Securities set forth in this paragraph 3 shall
continue with respect to each Securityholder Security until the earlier of (i)
the date on which such Securityholder Security has been transferred in a Public
Sale or pursuant to paragraph 4 hereof or (ii) the consummation of a Qualified
Public Offering.
4. Sale of Company.
(a) Third Party Transaction. If CIBC and Xxxxxxx (so long as
each such Person holds not less than 50% of the Securityholder Securities held
by such Person on the date hereof) (the "Approving Securityholders") and the
Board approve a Sale of the Company (the "Approved Sale"), each of the other
Securityholders (the "Other Securityholders") shall consent to, vote in favor of
and raise no objections against the Approved Sale. If the Approved Sale is
structured as (i) a merger or consolidation, each holder of Securityholder
Securities shall waive any dissenters rights, appraisal rights or similar rights
in connection with such merger or consolidation or (ii) a sale of stock, each
holder of Securityholder Securities shall agree to sell all of his or its
Securityholder Securities and options to acquire Securityholder Securities on
the terms and conditions approved by the Board. Each holder of Securityholder
Securities shall take all necessary or desirable actions in connection with the
consummation of the Approved Sale as reasonably requested by the Board or the
Approving Investors.
(b) Conditions to Obligation. The obligations of the holders
of Securityholder Securities with respect to the Approved Sale are subject to
the satisfaction of the following conditions: (i) upon the consummation of the
Approved Sale, each holder of Securityholder Securities shall receive the same
form of consideration and the same portion of the aggregate consideration such
holder would have received if such aggregate consideration had been distributed
by the Company in complete liquidation pursuant to the rights and preferences
set forth in the Company's Certificate of Incorporation as in effect immediately
prior to the consummation of the Approved Sale; (ii) if any holders of
Securityholder Securities are given an option as to the form and amount of
consideration to be received, each holder of Securityholder Securities shall be
given the same option; and (iii) each holder of then currently exercisable
rights to acquire Securityholder Securities shall be given an opportunity to
exercise such rights prior to the consummation of the Approved Sale and
participate in such sale as a holder of such Securityholder Securities.
(c) Purchaser Representative. If the Company or any of the
holders of Securityholder Securities enter into any negotiation or transaction
for which Rule 506 (or any similar
- 7 -
8
rule then in effect) promulgated by the Securities and Exchange Commission may
be available with respect to such negotiation or transaction (including a
merger, consolidation or other reorganization), each holder of Securityholder
Securities shall, at the request of the Company, appoint (and be responsible for
the fees and expenses of the person so appointed, if any) either: (i) a
purchaser representative (as such term is defined in Rule 501 (or any similar
rule then in effect) promulgated by the Securities and Exchange Commission)
designated by the Company; or (ii) another purchaser representative (reasonably
acceptable to the Company) designated by such holder of Securityholder
Securities.
(d) Expenses; Indemnification. All holders of Securityholder
Securities shall bear their pro rata share (based upon their share of the
aggregate proceeds received by such holders in connection therewith) of the
costs of any Approved Sale to the extent such costs are incurred for the
benefit of all holders of securities of the Company and are not otherwise paid
by the Company or the acquiring party. Costs incurred by the holders of
Securityholder Securities on their own behalf shall not be considered costs of
the Approved Sale. In addition, all holders of Securityholder Securities shall
be obligated to join on a pro rata basis (based upon their share of the
aggregate proceeds received by such holders in connection therewith) in any
indemnification or other obligations that the Approving Securityholders agree to
provide in connection with such Approved Sale (other than any such obligations
that relate specifically to a particular holder of Securityholder Securities
such as indemnification with respect to representations and warranties given by
a holder regarding such holder's title to and ownership of Securityholder
Securities).
(e) Termination. The provisions of this paragraph 4 shall
terminate upon the consummation of a Qualified Public Offering.
5. Legend. Each note or certificate evidencing Securityholder
Securities and each note or certificate issued in exchange for or upon the
transfer of any Securityholder Securities (if such Securities remain
Securityholder Securities after such transfer) shall be stamped or otherwise
imprinted with a legend in substantially the following form:
"The securities represented by this certificate are subject to
a Securityholders Agreement dated as of April 1, 1998 among
the issuer of such securities (the "Company") and certain of
the Company's Securityholders, as amended and modified from
time to time. A copy of such Securityholders Agreement shall
be furnished without charge by the Company to the holder
hereof upon written request."
The Company shall imprint such legend on certificates evidencing Securityholder
Securities outstanding as of the date hereof. The legend set forth above shall
be removed from the certificates evidencing any shares which cease to be
Securityholder Securities in accordance with the definition of Securityholder
Security in paragraph 8 hereof.
- 8 -
9
6. Transfer. Prior to transferring any Securityholder
Securities (other than pursuant to a Public Sale or a Sale of the Company) to
any Person, the transferring holders of Securityholder Securities shall cause
the prospective transferee to be bound by this Agreement and to execute and
deliver to the Company and the other holders of Securityholder Securities a
counterpart of this Agreement, and in the case of any transfer (whether directly
or indirectly) by an Executive to any member of his Family Group, the
transferring Executive shall cause each prospective transferee to execute and
deliver to the Executive (in form and substance reasonably acceptable to the
Company) an agreement irrevocably appointing the Executive as the transferee's
true and lawful proxy, agent and attorney-in-fact, with full power and
substitution, to vote all of the transferee's Securityholder Securities and
other voting securities of the Company in respect of all matters as provided in
this Agreement, in the Company's Certificate of Incorporation, or pursuant to
applicable law.
7. Senior Securities are Pari Passu. In the event of a Sale
of the Company or the liquidation, dissolution or winding up of the Company, or
in any reorganization or recapitalization of the Company (including pursuant to
a bankruptcy of the Company or its Subsidiaries), each holder of Notes and
Preferred Stock shall be entitled to be paid, on a pari passu basis
(notwithstanding any term to the contrary in the Purchase Agreement, the Notes
or the Company's Certificate of Incorporation and notwithstanding the
designation of one instrument as "debt" and the other as "equity") before any
distribution or payment is made upon the Common Stock, consideration in an
amount equal to the aggregate sum of the Liquidation Value and principal amount
of all Senior Securities held by such holder (plus all unpaid dividends and
interest which have accrued or been declared thereon) (the "Senior Security
Preference Amount"). If upon any such Sale of the Company or the liquidation,
dissolution or winding up of the Company, the Company's assets to be distributed
among the holders of the Senior Securities are insufficient to permit payment of
the Senior Security Preference Amount, then the entire consideration to be
distributed to the holders of Senior Securities shall be distributed pro rata
among such holders on a pari passu basis (notwithstanding any term to the
contrary in the Purchase Agreement, the Notes or the Company's Certificate of
Incorporation and notwithstanding the designation of one instrument as "debt"
and the other as "equity") based upon the sum of the Liquidation Value and
principal amount (plus all unpaid dividends and interest which have accrued or
been declared thereon) of the Senior Securities held by each such holder
relative to the aggregate sum of the Liquidation Value and principal amount of
all Senior Securities then outstanding. In the event of any bankruptcy,
recapitalization or reorganization of the Company, the holders of Notes covenant
and agree that they shall use their reasonable efforts to provide holders of
Preferred Stock (together with the holders of Notes), based on such holders pro
rata share of the aggregate sum of the Liquidation Value and principal amount of
all Senior Securities then outstanding (plus all unpaid dividends and interest
which have accrued or been declared thereon), representation on any creditors
committee or other formal or informal group representing holders of Notes, it
being the irrevocable agreement and understanding that the Notes and the
Preferred Stock are, in any such circumstance, to be treated as one and the same
class of securities, and all holders of Senior Securities shall be entitled to
share in all the rights, privileges and preferences that any holder of Notes may
have, notwithstanding the designation of one instrument as "debt" and the other
as "equity."
- 9 -
10
8. Required Consent. Without the vote or consent of both the
Xxxxxxx Representatives and the CIBC Representatives, the Company shall not:
(a) except as expressly contemplated by the Securities
Purchase Agreement or the Executive Stock Agreements, as in effect on the date
hereof, authorize, issue or enter into any agreement providing for the issuance
(contingent or otherwise), and whether in a public offering registered under the
Securities Act or pursuant to a private placement exempt from registration
thereunder, of any equity securities or any securities or rights convertible
into or exercisable or exchangeable for any equity securities in excess of 2,500
shares of Common Stock;
(b) and shall not permit any Subsidiary to, consolidate or
merge with, or sell, assign, transfer or lease all or substantially all of its
assets in a single transaction or a series of transactions to any Person;
(c) permit any Subsidiary of the Company to, directly or
indirectly, issue, contingently or otherwise, and whether in a public offering
registered under the Securities Act or pursuant to a private placement exempt
from registration thereunder, any shares representing an equity interest in the
Subsidiary, warrants, rights or options to purchase or acquire an equity
interest now or thereafter authorized for issuance, except to the Company or a
wholly-owned Subsidiary of the Company;
(d) acquire, or permit any Subsidiary to acquire, any interest
in any business, including any assumption of liabilities, contingent or
otherwise, and whether by a purchase of assets, purchase of stock, merger or
otherwise, or make any loans or advances to any Person (other than to a
Subsidiary, or as contemplated in the Executive Stock Agreement and the Investor
Stock Agreement as in effect on the date hereof), where the total consideration,
including the assumption of liabilities and issuance of stock is, in the
aggregate, more than $1,000,000; or
(e) amend the Company's certificate of incorporation.
9. Definitions.
"Affiliate" has the meaning set forth in paragraph 3(d).
"ASIG" means Aircraft Services International Group, Inc.,
a Delaware corporation.
"Approved Sale" has the meaning set forth in paragraph 4(a).
"Approving Securityholders" has the meaning set forth in
paragraph 4(a).
"Board" has the meaning set forth in the preamble.
"CIBC Directors" has the meaning set forth in paragraph
1(a)(ii).
- 10 -
11
"Chairman Agreement" means the Chairman Agreement, dated as of
the date hereof, between the Company, ASIG, Tioga Capital Corporation and Xxxxxx
Xxxxxxxx.
"Common Stock" means either or both of the Company's Class A
voting common stock, par value $.01 per share, and Class B nonvoting common
stock, par value $.01 per share.
"Company" has the meaning set forth in the preamble.
"Company Stock" means the Common Stock, the Preferred Stock
and the Notes.
"Election Period" has the meaning set forth in paragraph 3(a).
"Executive Directors" has the meaning set forth in paragraph
1(a)(ii).
"Executive Stock Agreements" has the meaning set forth in the
preamble.
"Executives" has the meaning set forth in the preamble.
"Exempt Transfer" has the meaning set forth in paragraph 3(a).
"Family Group" has the meaning set forth in paragraph 3(d).
"Xxxxxxx Directors" has the meaning set forth in paragraph
1(a)(ii).
"Independent Third Party" means any person (other than Xxxxxx
Xxxxxxxx, each Executive, and each other executive employee of the Company and
its subsidiaries) (i) who, immediately prior to the contemplated transaction,
does not own Company Stock representing in excess of 5% of the Company's Voting
Power, (ii) who is not controlling, controlled by or under common control with
any such person and (iii) who is not the spouse or descendant (by birth or
adoption) of any such person.
"Investors" has the meaning set forth in the preamble.
"Liquidation Value" has the meaning set forth in the Company's
Certificate of Incorporation.
"Notes" has the meaning set forth in the Securities Purchase
Agreement.
"Offer Notice" has the meaning set forth in paragraph 3(b).
"Offered Securities" has the meaning set forth in paragraph
3(b).
"Other Investors" has the meaning set forth in paragraph 3(c).
- 11 -
12
"Other Securityholders" has the meanings set forth in
paragraph 3(b) and paragraph 4(a), as appropriate.
"Outside Director" has the meaning set forth in paragraph
1(a)(ii).
"Permitted Transferee" has the meaning set forth in paragraph
3(d).
"Person" means an individual, a partnership, a corporation, a
limited liability company, an association, a joint stock company, a trust, a
joint venture, an unincorporated organization and a governmental entity or any
department, agency or political subdivision thereof.
"Preferred Stock" means the Company's Series A Preferred
Stock, par value $.01 per share.
"Public Sale" means any sale of Securityholder Securities to
the public pursuant to an offering registered under the Securities Act or to the
public through a broker, dealer or market maker pursuant to the provisions of
Rule 144 adopted under the Securities Act.
"Qualified Public Offering" means the sale in an underwritten
public offering by Company registered under the Securities Act of shares of
Common Stock having an aggregate primary offering value of at least $35 million
and a share price for each share of Common Stock of at least four times the
purchase price paid for shares of Common Stock in the Securities Purchase
Agreement.
"Sale Notice" has the meaning set forth in paragraph 3(c).
"Sale of the Company" means the sale of the Company to an
Independent Third Party or affiliated group of Independent Third Parties
pursuant to which such party or parties acquire (i) capital stock of the Company
possessing a majority of the Company's Voting Power (whether by merger,
consolidation or sale or transfer of the Company's capital stock) or (ii) all or
substantially all of the Company's assets determined on a consolidated basis.
"Securities" means any of the Notes, the Preferred Stock or
the Common Stock.
"Securities Act" means the Securities Act of 1933, as amended
from time to time.
"Securities Purchase Agreement" has the meaning set forth in
the preamble.
"Securityholder Securities" means: (i) any Common Stock
purchased or otherwise acquired by any Securityholder; (ii) any Preferred Stock
purchased or otherwise acquired by any Securityholder; (iii) any Notes purchased
or otherwise acquired by any Securityholder; and (iv) any debt securities,
capital stock or other equity securities issued or issuable directly or
indirectly with respect to the securities referred to in clauses (i), (ii) or
(iii) above by way of stock dividend or stock
- 12 -
13
split or in connection with a combination of shares, recapitalization, merger,
consolidation or other reorganization. As to any particular securities
constituting Securityholder Securities, such securities shall cease to be
Securityholder Securities when they have been (x) effectively registered under
the Securities Act and disposed of in accordance with the registration statement
covering them or (y) sold to the public through a broker, dealer or market maker
pursuant to Rule 144 (or any similar provision then in force) under the
Securities Act.
"Securityholders" has the meaning set forth in the preamble.
"Senior Securities" has the meaning set forth in paragraph
3(c).
"Senior Security Percentage" has the meaning set forth in
paragraph 3(c).
"Senior Security Preference Amount" has the meaning set forth
in paragraph 7.
"Sub Board" has the meaning set forth in paragraph 1(a)(iii).
"Subsidiary" means, with respect to any Person, any
corporation, limited liability company, partnership, association or other
business entity of which (i) if a corporation, a majority of the total voting
power of shares of stock entitled (without regard to the occurrence of any
contingency) to vote in the election of directors, managers or trustees thereof
is at the time owned or controlled, directly or indirectly, by that Person or
one or more of the other Subsidiaries of that Person or a combination thereof,
or (ii) if a limited liability company, partnership, association or other
business entity, a majority of the limited liability company, partnership or
other similar ownership interest thereof is at the time owned or controlled,
directly or indirectly, by that Person or one or more Subsidiaries of that
Person or a combination thereof. For purposes hereof, a Person or Persons shall
be deemed to have a majority ownership interest in a limited liability company,
partnership, association or other business entity if such Person or Persons
shall be allocated a majority of limited liability company, partnership,
association or other business entity gains or losses or shall be or control the
managing director or general partner of such limited liability company,
partnership, association or other business entity.
"Transfer" has the meaning set forth in paragraph 3(a).
"Transferring Securityholder" has the meaning set forth in
paragraph 3(b).
"Transferring Investor" has the meaning set forth in paragraph
3(c).
"Voting Power" means, with respect to each share of Company
Stock as determined on a fully-diluted basis, one (1) vote per share with
respect to the Class A Common Stock and Class B Common Stock (whether designated
as voting or nonvoting).
- 13 -
14
10. Transfers in Violation of Agreement. Any Transfer or
attempted Transfer of any Securityholder Securities in violation of any
provision of this Agreement shall be void, and the Company shall not record such
Transfer on its books or treat any purported transferee of such Securityholder
Securities as the owner of such shares for any purpose.
11. Amendment and Waiver. Except as otherwise provided herein,
no modification, amendment or waiver of any provision of this Agreement shall be
effective against the Company or the Securityholders unless such modification,
amendment or waiver is approved in writing by the Company or the holders of at
least 75% of Company's Voting Power, respectively; provided that no
modification, amendment or waiver of subparagraphs 1(a)(ii)(C) and 1(e) (to the
extent such amendment relates to Xxxxxx Xxxxxxxx) shall be effective without the
consent of Xxxxxx Xxxxxxxx (so long as he is Chairman pursuant to the Chairman
Agreement). The failure of any party to enforce any of the provisions of this
Agreement shall in no way be construed as a waiver of such provisions and shall
not affect the right of such party thereafter to enforce each and every
provision of this Agreement in accordance with its terms.
12. Severability. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if any provision of this Agreement is held to be invalid,
illegal or unenforceable in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or unenforceability shall not affect
the validity, legality or enforceability of any other provision of this
Agreement in such jurisdiction or affect the validity, legality or
enforceability of any provision in any other jurisdiction, but this Agreement
shall be reformed, construed and enforced in such jurisdiction as if such
invalid, illegal or unenforceable provision had never been contained herein.
13. Entire Agreement. Except as otherwise expressly set forth
herein, this Agreement embodies the complete agreement and understanding among
the parties hereto with respect to the subject matter hereof and supersedes and
preempts any prior understandings, agreements or representations by or among the
parties, written or oral, which may have related to the subject matter hereof in
any way.
14. Successors and Assigns. Except as otherwise provided
herein, this Agreement shall bind and inure to the benefit of and be enforceable
by the Company and its successors and assigns and the Securityholders and any
subsequent holders of Securityholder Securities and the respective successors
and assigns of each of them, so long as they hold Securityholder Securities.
15. Counterparts. This Agreement may be executed in any number
of counterparts, each of which shall be an original and all of which taken
together shall constitute one and the same agreement.
16. Remedies. The Company, the Investors and the Executives
shall be entitled to enforce their rights under this Agreement specifically, to
recover damages by reason of any breach of any provision of this Agreement and
to exercise all other rights existing in their favor. The parties
- 14 -
15
hereto agree and acknowledge that money damages would not be an adequate remedy
for any breach of the provisions of this Agreement and that the Company, any
Investor and any Executive shall be entitled to specific performance and/or
injunctive relief (without posting a bond or other security) from any court of
law or equity of competent jurisdiction in order to enforce or prevent any
violation of the provisions of this Agreement.
17. Notices. Any notice provided for in this Agreement shall
be in writing and shall be either personally delivered, or mailed first class
mail (postage paid) or sent by reputable overnight courier service (charges
prepaid) to the Company at the address set forth below and to any other
recipient at the address indicated on the schedules hereto and to any subsequent
holder of Securityholder Securities subject to this Agreement at such address as
indicated by the Company's records, or at such address or to the attention of
such other person as the recipient party has specified by prior written notice
to the sending party. Notices shall be deemed to have been given hereunder when
delivered personally, three days after deposit in the U.S. mail and one day
after deposit with a reputable overnight courier service. The Company's address
is:
Ranger Aerospace Corporation
GSP International Airport
Box 12233
Xxxxxxxxxx, XX 00000
Attn: Chief Financial Officer
with a copy (which shall not constitute notice) to:
Xxxxxxxx & Xxxxx
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx, P.C.
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
18. GOVERNING LAW. ALL ISSUES AND QUESTIONS CONCERNING THE
CONSTRUCTION, VALIDITY, INTERPRETATION AND ENFORCEABILITY OF THIS AGREEMENT AND
THE EXHIBITS AND SCHEDULES HERETO SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE, WITHOUT GIVING EFFECT TO ANY
CHOICE OF LAW OR CONFLICT OF LAW RULES OR PROVISIONS (WHETHER OF THE STATE OF
DELAWARE OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE APPLICATION OF THE LAWS
OF ANY JURISDICTION OTHER THAN THE STATE OF DELAWARE.
19. Descriptive Headings. The descriptive headings of this
Agreement are inserted for convenience only and do not constitute a part of this
Agreement.
* * * *
- 15 -
16
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement on the day and year first above written.
RANGER AEROSPACE CORPORATION,
a Delaware corporation
By: /s/ XXXXXXX X. XXXXXX
-------------------------
Its: President
-------------------------
INVESTORS
XXXX XXXXXXX MUTUAL LIFE
INSURANCE COMPANY
By: /s/ D. XXXX XXXXXXX
-------------------------
Its: Senior Investment Officer
-------------------------
CIBC WOOD GUNDY VENTURES, INC.
By: ILLEGIBLE
-------------------------
Its: Managing Director
-------------------------
XXXXXXXX XXXXXXXX TRUST, UAD 10/1/93
By: /s/ XXXX X. XXXXXXX
-------------------------
Its: Trustee
-------------------------
XXXXXXXX STREET PARTNERS II
By: /s/ XXXXXXX X. XXXXXX
-------------------------
Its: partner
-------------------------
/s/ XXXXX X. XXXXXX
-------------------------
XXXXXXX XXXXXX
EXECUTIVES
/s/ XXXXXXX X. XXXXXX
-------------------------
XXXXXXX X. XXXXXX
- 16 -
17
SCHEDULE OF SECURITYHOLDERS
-----------------------------------------------------------------------------------------------------------
Class of Number of
Securityholder Securityholder
Name and Address Shares Shares
-----------------------------------------------------------------------------------------------------------
Xxxx Xxxxxxx Mutual Life Insurance Company Class B Non-Voting 56,400
Xxxx Xxxxxxx Place, Box 111 Common Stock
Xxxxxx, XX 00000
Telephone: (000) 000-0000 10.5% Payment-In- $8,460,000
Facsimile: (000) 000-0000 Kind Notes
Attention: Xxxx Xxxxxxx
-----------------------------------------------------------------------------------------------------------
CIBC Wood Gundy Ventures, Inc. Class A Voting 18,370
000 Xxxxxxxxx Xxxxxx, 0xx Xxxxx Xxxxxx Xxxxx
Xxx Xxxx, XX 00000
Telephone: (000) 000-0000 Class B Non-Voting 12,630
Facsimile: (000) 000-0000 Common Stock
Attention: Xxx Xxxxxx
10.5% Pay-In-Kind 4,650
Redeemable
Preferred Stock
-----------------------------------------------------------------------------------------------------------
Xxxxxxxx Xxxxxxxx Trust, UAD 10/1/93 Class A Voting 5,964.8
c/o Xxxxxx Xxxxxxxx Common Stock
000 Xxxxx Xxxxxx
Xxxxxx Xxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
-----------------------------------------------------------------------------------------------------------
Xxxxxxxx Street Partners, II Class A Voting 5,000
000 X. Xxxxxxxx Xxxxxx Xxxxx
Xxxxxxx, XX 00000
Telephone: (000) 000-0000 10.5% Pay-In-Kind 750
Facsimile: (000) 000-0000 Redeemable
Attention: Xxxxxxx X. Xxxxxx, P.C. Preferred Stock
-----------------------------------------------------------------------------------------------------------
Xxxxx Xxxxxx Class A Voting 4,000
c/o Suiza Foods Corporation Common Stock
000 Xxxxxx Xxxxx Xxxx.
Xxxxxx, XX 00000 10.5% Pay-In-Kind 600
Telephone: (000) 000-0000 Redeemable
Facsimile: (000) 000-0000 Preferred Stock
-----------------------------------------------------------------------------------------------------------
Xxxxx Xxxxxxxxx Class A Voting 1,491.2
000 Xxxxxxxxx Xxxxxx Xxxxxx Xxxxx
Xxxxxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
-----------------------------------------------------------------------------------------------------------
- 17 -
18
EXECUTIVES
--------------------------------------------------------------------------------
Class of Number of
Securityholder Securityholder
Name and Address Shares Shares
--------------------------------------------------------------------------------
Xxxxxxx X. Xxxxxx Class A Voting 2,663
000 Xxxxxxxxxxx Xxxxx Xxxxxx Xxxxx
Xxxxx, XX 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
--------------------------------------------------------------------------------
- 18 -
