Exhibit F
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AVIALL, INC.
_______________________
REGISTRATION RIGHTS AGREEMENT
Dated as of December 21, 2001
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1. DEFINITIONS ........................................................... 1
2. SHELF REGISTRATION .................................................... 4
3. DEMAND REGISTRATIONS .................................................. 4
(a) Timing Of Demand Registrations ...................................... 4
(b) Number of Demand Registrations ...................................... 5
(c) Required Thresholds ................................................. 5
(d) Participation ....................................................... 5
(e) Underwriter's Cutback ............................................... 5
(f) Managing Underwriter ................................................ 5
4. PIGGYBACK REGISTRATIONS ............................................... 6
(a) Participation ....................................................... 6
(b) Underwriter's Cutback ............................................... 6
(c) Company Control ..................................................... 6
5. HOLD-BACK AGREEMENTS .................................................. 6
6. LIQUIDATED DAMAGES .................................................... 7
7. REGISTRATION PROCEDURES ............................................... 7
8. REGISTRATION EXPENSES ................................................. 11
9. INDEMNIFICATION ....................................................... 12
(a) Indemnification by Company .......................................... 12
(b) Indemnification Procedures .......................................... 13
(c) Indemnification by Holder of Registrable Securities. ................ 13
(d) Contribution ........................................................ 14
10. EXCHANGE ACT REPORTING REQUIREMENTS ................................... 14
11. REQUIREMENTS FOR PARTICIPATION IN UNDERWRITTEN OFFERINGS .............. 15
12. FUTURE REGISTRATION RIGHTS AGREEMENTS ................................. 15
13. MISCELLANEOUS ......................................................... 16
(a) Remedies ............................................................ 16
(b) No Inconsistent Agreements .......................................... 16
(c) Amendments and Waivers .............................................. 16
(d) Notices ............................................................. 16
(e) Successors and Assigns .............................................. 17
(f) Counterparts ........................................................ 17
(g) Table of Contents and Headings ...................................... 17
(h) Governing Law ....................................................... 17
(i) Severability ........................................................ 17
(j) Forms ............................................................... 17
(k) Entire Agreement .................................................... 18
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AVIALL, INC.
This Registration Rights Agreement ("Agreement") is made and entered
into as of December 21, 2001, by and among Aviall, Inc., a Delaware corporation
(the "Company"), and the investors (herein referred to collectively as the
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"Investors" and individually as an "Investor") constituting the "Purchasers"
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under the Securities Purchase Agreement dated as of December 17, 2001 (the
"Purchase Agreement"). In order to induce the Investors to enter into the
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Purchase Agreement, the Company has agreed to provide the registration rights
set forth in this Agreement. The execution of this Agreement is a condition to
the closing under the Purchase Agreement. Capitalized terms used herein and not
otherwise defined shall have the meaning assigned to them in the Purchase
Agreement.
The parties hereby agree as follows:
1. Definitions
As used in this Agreement, the following capitalized terms shall have
the following meanings:
"Board of Directors": The Board of Directors of the Company.
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"Bridge Securities": (a) The shares of Bridge Preferred Stock, (b)
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the shares of Common Stock and Mezzanine PreferredStock issued or issuable upon
conversion of the Bridge Preferred Stock, and (c) any securities issued or
issuable with respect to either (a) or (b) by way of a stock dividend or stock
split or in connection with a combination of shares, recapitalization, merger,
consolidation or reorganization.
"Claim": Any loss, claim, damages, liability or expense (including
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the reasonable costs of investigation and legal fees and expenses).
"Common Stock": The common stock, par value $.01 per share, of the
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Company.
"Demand Registration": A registration pursuant to Section 3 hereof.
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"Effectiveness Deadline": The deadline set forth in Section 2 hereof.
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"Equity Security": Any capital stock of the Company or any security
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convertible, with or without consideration, into any such stock, or any security
carrying any warrant or right to subscribe to or purchase any such stock, or any
such warrant or right.
"Exchange Act": The Securities Exchange Act of 1934, as from time to
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time amended.
"Filing Deadline" The deadline set forth in Section 2 hereof.
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"Firm Commitment Underwritten Offering": An offering in which the
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underwriters agree to purchase securities for distribution pursuant to a
registration statement under the Securities
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Act and in which the obligation of the underwriters is to purchase all the
securities being offered if any are purchased.
"Holder": The beneficial owner of a security. For all purposes of
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this Agreement, the Company shall be entitled to treatthe record owner of a
security as the beneficial owner of such security unless the Company has been
given written notice of the existence and identity of a different beneficial
owner. A Holder of Bridge Preferred Stock shall be deemed to be the Holder of
the Common Stock and Mezzanine Preferred Stock into which such Bridge Preferred
Stock could be converted.
"Indemnified Holder": Any Holder of Registrable Securities, any
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officer, director, employee or agent of any such Holder and any Person who
controls any such Holder within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act.
"Initial Increase Date": The date which is 100 calendar days after
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the Initial Issue Date.
"Initial Issue Date": The date that shares of Bridge Preferred Stock
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are first issued by the Company.
"Misstatement": An untrue statement of a material fact or an omission
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to state a material fact required to be stated in a Registration Statement or
Prospectus or necessary to make the statements in a Registration Statement,
Prospectus or preliminary prospectus, in light of the circumstances under which
they were made, not misleading.
"Other Registration Rights Agreement": That certain Registration
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Rights Agreement dated as of December 21, 2001 by and amongthe Company, X.X.
Xxxxxxx Mezzanine Fund, L.P. and the other purchasers named therein.
"Parity Stock": The shares of Restricted Stock (as defined in the
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Other Registration Rights Agreement).
"Person": A natural person, partnership, corporation, business trust,
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association, joint venture, limited liability company or other entity or a
government or agency or political subdivision thereof.
"Piggyback Registration": A registration pursuant to Section 4 hereof.
---------------------- "Prospectus": The prospectus included in any
Registration Statement, as supplemented by any and all prospectus supplements
and as amended by any and all post-effective amendments and including all
material incorporated by reference in such prospectus.
"Registrable Securities": The Bridge Securities, any shares of the
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Permanent Preferred Stock, any shares of Common Stock issuable upon conversion
of any shares of Permanent Preferred Stock and any securities issued or issuable
with respect to thereto by way of a stock dividend or stock split or in
connection with a combination of shares, recapitalization, merger, consolidation
or reorganization (including, without limitation the shares of Bridge Preferred
Stock
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issued as dividends on outstanding shares of Bridge Preferred Stock and shares
of Permanent Preferred Stock issued as dividends on outstanding shares of
Permanent Preferred Stock).
"Registration": A Shelf Registration, Demand Registration or a
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Piggyback Registration.
"Registration Default": A registration default pursuant to Section 6
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hereof.
"Registration Expenses": The out-of-pocket expenses incurred in
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connection with a Registration, including:
(1) all registration and filing fees (including fees with respect
to filings required to be made with the National Association of
Securities Dealers);
(2) fees and expenses of compliance with securities or blue sky
laws (including fees and disbursements of counsel for the underwriters
or selling Holders in connection with blue sky qualifications of the
Registrable Securities and determinations of their eligibility for
investment under the laws of such jurisdictions as the managing
underwriters or Holders of a majority of the Registrable Securities
being sold may designate);
(3) printing, messenger, telephone and delivery expenses;
(4) fees and disbursements of counsel for the Company, counsel
for the underwriters and of not more than one firm of attorneys for
the sellers of the Registrable Securities;
(5) fees and disbursements of all independent certified public
accountants of the Company incurred in connection with such
Registration (including the expenses of any special audit and comfort
letters incident to such registration);
(6) fees and disbursements of underwriters (excluding discounts,
commissions, fees or expenses of underwriters, selling brokers, dealer
managers or similar securities industry professionals relating to the
distribution of the Registrable Securities); and
(7) fees and expenses of any other Persons retained by the
Company.
"Registration Statement": Any registration statement under the
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Securities Act on an appropriate form (which form shall be available for the
sale of the Registrable Securities in accordance with the intended method or
methods of distribution thereof and shall include all financial statements
required by the SEC to be filed therewith) which covers Registrable Securities
pursuant to the provisions of this Agreement, including the Prospectus included
in such registration statement, amendments (including post-effective amendments)
and supplements to such registration statement, and all exhibits to and all
material incorporated by reference in such registration statement.
"Securities Act": The Securities Act of 1933, as from time to time
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amended.
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"SEC": The Securities and Exchange Commission.
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"Shelf Registration": A registration pursuant to Section 2 hereof.
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2. Shelf Registration
If the Required Stockholder Approval shall not have been obtained on
or prior to the Initial Increase Date, the Company shall file with the SEC, as
soon as practicable, but in any event within thirty (30) days after the Initial
Increase Date (the "Filing Deadline"), a registration statement on Form S-3 (the
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"Shelf Registration Statement") in accordance with Rule 415 of the Securities
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Act providing for resale, from time to time, of the Bridge Securities by the
Holders of the Bridge Securities. The Company shall cause such Registration
Statement to become effective under the Securities Act as soon as practicable
but in any event within ninety (90) days of the Initial Increase Date (the
"Effectiveness Deadline"). The Company shall keep any Shelf Registration
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Statement required by this Section 2 continuously effective, supplemented,
amended and current as required by and subject to the provisions of Section 7
hereof and in conformity with the requirements of this Agreement, the Securities
Act and the policies, rules and regulations of the SEC as announced from time to
time, until the earlier of (a) the date on which the Bridge Securities are no
longer outstanding, (b) the date on which all Bridge Securities are eligible for
resale under Rule 144(k) promulgated under the Securities Act, and (c) the date
on which the Required Stockholder Approval has been obtained and the Permanent
Preferred Shares have been issued to the Holders of the Bridge Securities.
3. Demand Registrations
(a) Timing Of Demand Registrations
Holders of Registrable Securities constituting at least 51% of the
Registrable Securities then outstanding may request in writing at any time and
from time to time that the Company file a registration statement under the
Securities Act on an appropriate form (which form shall be available for the
sale of the Registrable Securities in accordance with the intended method or
methods of distribution thereof and shall include all financial statements
required by the SEC to be filed therewith) covering the shares of Registrable
Securities that are the subject of such request. Notwithstanding the foregoing,
the Holders of Registrable Securities shall not request that the Company file a
registration statement for the Bridge Securities prior to the Initial Increase
Date. Following such request, the Company shall (i) file with the SEC, as soon
as possible but in any event within thirty (30) days of receipt of such request,
such a Registration Statement covering the Registrable Securities requested to
be included in such registration and (ii) cause such Registration Statement to
be declared effective by the SEC, as soon as possible, but in any event within
ninety (90) days of receipt of such request. The Company shall keep any
Registration Statement required by this Section 3 continuously effective,
supplemented, amended and current as required by and subject to the provisions
of Section 7 hereof and in conformity with the requirements of this Agreement,
the Securities Act and the policies, rules and regulations of the SEC as
announced from time to time, until the earlier of (a) the date on which all
Registrable Securities registered pursuant to such Registration Statement have
been sold pursuant to such Registration Statement and (b) the date on which all
Registrable Securities registered pursuant to such Registration Statement are
eligible for resale under Rule 144(k) promulgated under the Securities Act. If
requested by the
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Holders requesting registration of Registrable Securities pursuant to this
Section 3(a), such registration shall provide for resale, from time to time, of
the Registrable Securities on a delayed or continuous basis pursuant to Rule 415
under the Securities Act.
(b) Number of Demand Registrations
No more than four Demand Registrations pursuant to Section 3(a)
shall provide for underwritten offering (any registration for such offering
being referred to as an "Underwritten Demand Registration"); provided, however,
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that any such Registration shall not be counted as one of the four Underwritten
Demand Registrations hereunder unless it becomes effective and is maintained
effective in accordance with the requirements specified in Section 3(a).
(c) Required Thresholds
The Company shall not be obligated to prepare, file and cause to
become effective pursuant to this Section 3 a Registration Statement unless the
proposed aggregate public offering price of the securities to be included in
such Demand Registration is at least $10,000,000 (except for the final Demand
Registration exercised).
(d) Participation
The Company shall promptly give written notice to all Holders of
Registrable Securities upon receipt of a request for a Demand Registration
pursuant to Section 3(a) above. The Company shall, subject to Section 3(e)
below, include in such Demand Registration such shares of Registrable Securities
for which it has received written requests to register such shares within 20
days after such written notice has been given. No shares of Common Stock or
other securities to be sold by the Company or any holder of shares of Common
Stock or other securities of the Company (other than the Holders) shall be
included in any Registration effected pursuant to this Section 3.
(e) Underwriter's Cutback
If the public offering of Registrable Securities is to be
underwritten and, in the good faith judgment of the managing underwriter, the
inclusion of all the Registrable Securities requested to be registered hereunder
would interfere with the successful marketing of a smaller number of such shares
of Registrable Securities, the number of shares of Registrable Securities to be
included in such registration shall be reduced to such smaller number with the
participation in such offering to be pro rata among the Holders of Registrable
Securities requesting such registration, based upon the number of shares of
Registrable Securities owned by such Holders.
(f) Managing Underwriter
The managing underwriter or underwriters of any underwritten
public offering covered by a Demand Registration shall be selected by the
Holders of a majority of the shares of Registrable Securities to be included in
such registration and shall be reasonably acceptable to the Company. For the
purposes hereof, the parties hereto agree that Xxxxxxx Xxxxx Barney shall be an
acceptable underwriter.
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4. Piggyback Registrations
(a) Participation
Each time the Company decides to file a registration statement under
the Securities Act (other than registrations on Forms S-4 or S-8 or any
successor form thereto, and other than a Demand Registration) covering the offer
and sale by it or any of its security Holders of any of its securities for cash
(other than any Registration Statement filed pursuant to the Other Registration
Rights Agreement) (a "Piggyback Registration"), the Company shall give written
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notice thereof to all Holders of outstanding Registrable Securities. The Company
shall include in such Registration Statement such shares of Registrable
Securities for which it has received written requests to register such shares
within 20 days after such written notice has been given. If the Registration
Statement is to cover an underwritten offering, such Registrable Securities
shall be included in the underwriting on the same terms and conditions as the
securities otherwise being sold through the underwriters.
(b) Underwriter's Cutback
Subject to the requirements of Section 11 hereof, if in the good faith
judgment of the managing underwriter of such offering the inclusion of all of
the shares of Registrable Securities and any other Common Stock requested to be
registered would interfere with the successful marketing of a smaller number of
such shares, then the number of shares of Registrable Securities and other
Common Stock to be included in the offering shall be reduced to such smaller
number with the participation in such offering to be in the following order of
priority: (i) first, the shares of Common Stock which the Company proposes to
sell for its own account, (ii) second, the shares of Registrable Securities and
the Parity Stock requested to be included in such registration, and (iii) third,
any other shares of Common Stock requested to be included. Any necessary
allocation among the Holders of Registrable Securities and Holders of shares of
Parity Stock shall be pro rata among such Holders based upon the number of
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shares of Parity Stock and Registrable Securities owned by such Holders.
(c) Company Control
The Company may decline to file a Registration Statement after giving
notice to any Holder pursuant to Section 4(a) above, or withdraw a Registration
Statement filed pursuant to Section 4(a) after filing and after such notice, but
prior to the effectiveness thereof, provided that the Company shall promptly
notify each Holder in writing of any such action and provided further that the
Company shall bear all expenses incurred by such Holder or otherwise in
connection with such withdrawn Registration Statement.
5. Hold-Back Agreements
Except as required pursuant to the Other Registration Rights
Agreement, the Company agrees not to effect any public sale or distribution of
its Equity Securities during the 30-day period prior to, and during the 120-day
period after, the effective date of each underwritten offering made pursuant to
a Demand Registration or a Piggyback Registration, if so requested in writing by
the managing underwriter of any offering effected pursuant to this Agreement
(except as part of such underwritten offering or pursuant to registrations on
Forms S-4 or S-8).
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6. Liquidated Damages
If (i) the Shelf Registration Statement required by this Agreement is
not filed with the SEC on or prior to the Filing Deadline, (ii) the Shelf
Registration Statement has not been declared effective by the SEC on or prior to
the applicable Effectiveness Deadline, or (iii) the Shelf Registration Statement
required by this Agreement is filed and declared effective but shall thereafter
cease to be effective or fail to be usable for its intended purpose without
being succeeded within 2 days by a post-effective amendment to the Shelf
Registration Statement that cures such failure and that is itself declared
effective within 5 days of filing such post-effective amendment to the Shelf
Registration Statement (each such event referred to in clauses (i) through
(iii), a "Registration Default"), then the Company hereby agrees to pay to each
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Holder of Bridge Securities affected thereby liquidated damages in an amount
equal to $0.50 per week per $1,000 liquidation preference of the Bridge
Preferred Stock and/or Mezzanine Preferred Stock held by such Holder for each
week or portion thereof that the Registration Default continues for the first
90-day period immediately following the occurrence of such Registration Default.
The amount of the liquidated damages shall increase by an additional $0.25 per
week per $1,000 liquidation preference of the Bridge Preferred Stock and/or
Mezzanine Preferred Stock with respect to each subsequent 90-day period until
all Registration Defaults have been cured, up to a maximum amount of liquidated
damages of $2.50 per week per $1,000 liquidation preference of the Bridge
Preferred Stock and/or Mezzanine Preferred Stock; provided that the Company
shall in no event be required to pay liquidated damages for more than one
Registration Default at any given time. Notwithstanding anything to the contrary
set forth herein, (1) upon filing of the Shelf Registration Statement, in the
case of (i) above, (2) upon the effectiveness of the Shelf Registration
Statement, in the case of (ii) above, (3) upon the filing of a post-effective
amendment to the Shelf Registration Statement or an additional Registration
Statement that causes the Shelf Registration Statement to again be declared
effective or made usable in the case of (iii) above, the liquidated damages
payable with respect to the Registrable Securities as a result of such clause
(i), (ii) or (iii), as applicable, shall cease.
All accrued liquidated damages shall be paid to the Holders entitled
thereto, in cash on each Dividend Payment Date (as defined in the Bridge
Preferred Stock Certificate of Designations or the Preferred Stock Certificate
of Designations, as applicable). Notwithstanding the fact that any securities
for which liquidated damages are due cease to be Registrable Securities, all
obligations of the Company to pay liquidated damages with respect to securities
shall survive until such time as such obligations with respect to such
securities shall have been satisfied in full.
7. Registration Procedures
In connection with any Registration Statement and any related
Prospectus required by this Agreement, the Company shall:
(a) prepare and file with the SEC as soon as practicable a
Registration Statement with respect to such Registrable Securities and use its
commercially reasonable efforts to keep such Registration Statement continuously
effective and provide all requisite financial statements for the period
specified in Sections 2, 3 or 4 of this Agreement, as applicable. Upon the
occurrence of any event that would cause any such Registration Statement or the
Prospectus contained therein (A) to contain an untrue statement of material fact
or omit to state any material fact necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading or (B)
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not to be effective and usable for resale of Registrable Securities during the
period required by this Agreement, the Company shall file promptly an
appropriate amendment to such Registration Statement curing such defect, and, if
SEC review is required, use its commercially reasonable efforts to cause such
amendment to be declared effective by the SEC as soon as practicable;
(b) prepare and file with the SEC such amendments and post-effective
amendments to the applicable Registration Statement as may be necessary to keep
such Registration Statement effective for the applicable period set forth in
Sections 2, 3 or 4 hereof, as the case may be; cause the Prospectus to be
supplemented by any required Prospectus supplement, and as so supplemented to be
filed pursuant to Rule 424 under the Securities Act, and to comply fully with
Rules 424, 430A and 462, as applicable, under the Securities Act in a timely
manner; and comply with the provisions of the Securities Act with respect to the
disposition of all securities covered by such Registration Statement during the
applicable period in accordance with the intended method or methods of
distribution by the sellers thereof set forth in such Registration Statement or
supplement to the Prospectus;
(c) promptly notify the selling Holders of Registrable Securities and
the managing underwriter, if any, and (if requested by any such Person) confirm
such advice in writing,
(1) when the Prospectus or any supplement or post-effective
amendment has been filed, and, with respect to the Registration Statement
or any post-effective amendment, when the same has become effective,
(2) of any request by the SEC for amendments or supplements to
the Registration Statement or the Prospectus or for additional information,
(3) of the issuance by the SEC of any stop order suspending the
effectiveness of the Registration Statement or the initiation of any
proceedings for that purpose,
(4) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Registrable
Securities for sale in any jurisdiction or the initiation or threatening of
any proceeding for such purpose, and
(5) of the existence of any fact or the happening of any event
which results in the Registration Statement, the Prospectus or any
amendment or supplement thereto, or any document incorporated therein by
reference containing a Misstatement;
(d) make every commercially reasonable effort to obtain the
withdrawal or lifting of any order suspending the effectiveness of the
Registration Statement at the earliest possible time;
(e) if requested by the managing underwriter or a Holder of
Registrable Securities being sold in connection with an underwritten offering,
promptly incorporate in a supplement or post-effective amendment such
information as the managing underwriter and the Holders of a majority of the
Registrable Securities being sold agree should be included therein relating to
the sale of the Registrable Securities, including, without limitation,
information with respect to the number of shares of Registrable Securities being
sold to underwriters, the purchase
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price being paid therefor by such underwriters and with respect to any other
terms of the underwritten offering of the Registrable Securities to be sold in
such offering; and make all required filings of such supplement or
post-effective amendment as soon as notified of the matters to be incorporated
in such supplement or post-effective amendment;
(f) furnish to each selling Holder of Registrable Securities and
the managing underwriter, without charge, before filing with the SEC, copies of
any Registration Statement or any Prospectus included therein or any amendments
or supplements to any such Registration Statement or Prospectus (not including
any Form 8-K, Form 10-Q, Form 10-K or Proxy Statement incorporated by reference
after the initial filing of such Registration Statement), which documents will
be subject to the review and comment of such Holders in connection with such
sale, if any, for a period of three Business Days, and the Company will not file
any such Registration Statement or Prospectus or any amendment or supplement to
any such Registration Statement or Prospectus (not including any Form 8-K, Form
10-Q, Form 10-K or Proxy Statement incorporated by reference after the initial
filing of such Registration Statement) to which such Holders shall reasonably
object within three Business Days after the receipt thereof. A Holder shall be
deemed to have reasonably objected to such filing if such Registration
Statement, amendment, Prospectus or supplement, as applicable, as proposed to be
filed, contains a Misstatement or fails to comply with the applicable
requirements of the Securities Act;
(g) furnish to each Holder of Registrable Securities and the
managing underwriter, without charge, at least one copy of the Registration
Statement, as first filed with the SEC, and of each amendment thereto, including
all documents incorporated by reference therein and all exhibits (including
exhibits incorporated therein by reference);
(h) deliver to each selling Holder of Registrable Securities and
the underwriters, if any, without charge, as many copies of each Prospectus (and
each preliminary prospectus) as such Persons may reasonably request (the Company
hereby consenting to the use of each such Prospectus (or preliminary prospectus)
by each of the selling Holders of Registrable Securities and the underwriters,
if any, in connection with the offering and sale of the Registrable Securities
covered by such Prospectus (or preliminary prospectus) in accordance with
applicable law and the disclosure set forth in such Prospectus);
(i) prior to any public offering of Registrable Securities,
register or qualify or cooperate with the selling Holders of Registrable
Securities, the underwriters, if any, and their respective counsel in connection
with the registration or qualification of such Registrable Securities for offer
and sale under the securities or blue sky laws of such jurisdictions as such
selling Holders or underwriters may designate in writing and do anything else
reasonably necessary or advisable to enable the disposition in such
jurisdictions of the Registrable Securities covered by the Registration
Statement; provided 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;
(j) cooperate with the selling Holders of Registrable Securities
and the managing underwriter, if any, to facilitate the timely preparation and
delivery of certificates not bearing any restrictive legends representing the
Registrable Securities to be sold and cause such Registrable Securities to be in
such denominations and registered in such names as the managing
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underwriter may reasonably request at least three business days prior to any
sale of Registrable Securities to the underwriters;
(k) cause the Registrable Securities covered by the
Registration Statement to be registered with or approved by such other
governmental agencies or authorities as may be necessary to enable the seller or
sellers thereof or the underwriters, if any, to consummate the disposition of
such Registrable Securities;
(l) if the Registration Statement or the Prospectus contains a
Misstatement, prepare a supplement or post-effective amendment to the
Registration Statement or the related Prospectus or any document incorporated
therein by reference or file any other required document so that, as thereafter
delivered to the purchasers of the Registrable Securities, the Prospectus will
not contain a Misstatement;
(m) cause all Registrable Securities covered by the
Registration Statement to be listed on the New York Stock Exchange;
(n) provide a CUSIP number for all Registrable Securities not
later than the effective date of the Registration Statement;
(o) in the event of any underwritten public offering, enter
into and perform its obligations under an underwriting agreement in customary
form with the managing underwriter of such offering and perform all other action
as are customary in such an underwritten public offering, including reasonable
participation of senior management in a "road show."
(p) enter into such agreements (including an underwriting
agreement) and do anything else reasonably necessary or advisable in order to
expedite or facilitate the disposition of such Registrable Securities in
accordance with applicable law and the disclosure set forth in the applicable
Registration Statement, and in such connection, whether or not the registration
is an underwritten registration:
(1) make such representations and warranties to the
Holders of such Registrable Securities and the underwriters, if any, in
form, substance and scope as are customarily made by issuers to
underwriters in primary underwritten offerings;
(2) obtain opinions of counsel to the Company and
updates thereof (which counsel and opinions (in form, scope and
substance) shall be reasonably satisfactory to the managing underwriter,
if any, and the Holders of a majority of the Registrable Securities being
sold) addressed to each selling Holder and the underwriter, if any,
covering the matters customarily covered in opinions delivered to
underwriters in primary underwritten offerings and such other matters as
may be reasonably requested by such Holders or underwriters;
(3) obtain comfort letters and updates thereof from the
Company's independent certified public accountants addressed to the
selling Holders of Registrable Securities registered thereunder and the
underwriters, if any, such letters to be in customary form and covering
matters of the type customarily covered in comfort letters by
underwriters in connection with underwritten offerings; and
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(4) deliver such documents and certificates as may be
reasonably requested by the Holders of a majority of the Registrable
Securities being sold and the managing underwriter, if any, to evidence
compliance with clause (1) above and with any customary conditions
contained in the underwriting agreement or other agreement entered into
by the Company.
The above shall be done at each closing under such underwriting or similar
agreement;
(q) following reasonable advance notice, make available for
inspection by representatives of the Holders of a majority of the Registrable
Securities being sold, any underwriter participating in any disposition pursuant
to such Registration Statement, and any attorney or accountant retained by the
sellers or any such underwriter, all relevant financial and other records and
pertinent corporate documents and properties of the Company, as shall be
reasonably deemed necessary the such Holder, and cause the Company's officers,
directors and employees to supply all relevant information, reasonably requested
by any such selling Holder, underwriter, attorney or accountant in connection
with the Registration as is customary for similar due diligence examinations
during normal business hours at the offices where such information is normally
kept; provided that any records, information or documents that are designated by
the Company in writing as confidential shall be kept confidential by such
Persons unless disclosure of such records, information or documents is required
by court or administrative order; and
(r) otherwise use its commercially reasonable efforts to comply
with all applicable rules and regulations of the SEC, and make generally
available to its security Holders earnings statements satisfying the provisions
of Section 11(a) of the Securities Act, no later than 45 days after the end of
any 12-month period (or 90 days, if such period is a fiscal year) (x) commencing
at the end of any fiscal quarter in which Registrable Securities are sold to
underwriters in an underwritten offering, or, if not sold to underwriters in
such an offering, (y) beginning with the first month of the Company's first
fiscal quarter commencing after the effective date of the Registration
Statement, which statements shall cover said 12-month periods.
Notwithstanding anything set forth in this Agreement, the Company
shall have the right once per calendar year to delay the filing of a
Registration Statement pursuant to this Agreement and to suspend the
effectiveness of any such Registration Statement for a reasonable period of time
(not exceeding thirty (30) days) if the Company furnishes to the selling Holders
a certificate signed by the Chairman of the Board or the President of the
Company stating that the Company has determined in good faith that effecting
such registration or offering at such time would adversely affect a material
financing, acquisition or disposition of assets, distribution rights or stock,
merger or other comparable transaction or would require the Company to make
public disclosure of information the public disclosure of which would have a
material adverse effect upon the Company.
8. Registration Expenses
(a) All expenses incurred in connection with the Company's
performance of or compliance with this Agreement will be borne by the Company
(other than underwriting discounts or commissions), regardless of whether a
Registration Statement becomes effective, including without limitation: (i) all
registration and filing fees and expenses; (ii) all fees and expenses of
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compliance with federal securities and state Blue Sky or securities laws; (iii)
all expenses of printing, messenger and delivery services and telephone; (iv)
all fees and disbursements of one counsel for the Company and one counsel for
the Holders of Registrable Securities; (v) all application and filing fees in
connection with listing the Registrable Securities on the New York Stock
Exchange pursuant to the requirements hereof; and (vi) all fees and
disbursements of independent certified public accountants of the Company
(including the expenses of any special audit and comfort letters required by or
incident to such performance).
The Company will, in any event, bear its internal expenses
(including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties), the expenses of any annual
audit and the fees and expenses of any Person, including special experts,
retained by the Company.
(b) In connection with any Registration Statement required by
this Agreement, the Company will reimburse the Holders of Registrable Securities
for the reasonable fees and disbursements of not more than one counsel.
Notwithstanding the foregoing, the Company shall not have any
obligation whatsoever in respect of any underwriters' discounts or commissions,
brokerage commissions, dealers' selling concessions, transfer taxes or except as
otherwise expressly set forth herein.
9. Indemnification
(a) Indemnification by Company
The Company agrees to indemnify and hold harmless each Indemnified
Holder from and against all Claims arising out of or based upon any Misstatement
or alleged Misstatement, except insofar as such Misstatement or alleged
Misstatement was based upon or reliance upon information furnished in writing to
the Company by such Indemnified Holder expressly for use in the document
containing such Misstatement or alleged Misstatement. This indemnity shall not
be exclusive and shall be in addition to any liability which the Company may
otherwise have.
The foregoing notwithstanding, the Company shall not be liable to
the extent that any such Claim arises out of or is based upon a Misstatement or
alleged Misstatement made in any preliminary prospectus if (i) such Indemnified
Holder failed to send or deliver a copy of the Prospectus with or prior to the
delivery of written confirmation of the sale of Registrable Securities giving
rise to such Claim and (ii) the Prospectus would have corrected such untrue
statement or omission.
In addition, the Company shall not be liable to the extent that
any such Claim arises out of or is based upon a Misstatement or alleged
Misstatement in a Prospectus, (x) if such Misstatement or alleged Misstatement
is corrected in an amendment or supplement to such Prospectus and (y) having
previously been furnished by or on behalf of the Company with copies of the
Prospectus as so amended or supplemented, such Indemnified Holder thereafter
fails to deliver such Prospectus as so amended or supplemented prior to or
concurrently with the sale to the person who purchased a Registrable Security
from such Indemnified Holder and who is asserting such Claim.
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(b) Indemnification Procedures
If any action or proceeding (including any governmental
investigation or inquiry) shall be brought or asserted against an Indemnified
Holder in respect of which indemnity may be sought from the Company, such
Indemnified Holder shall promptly notify the Company in writing, and the Company
shall assume the defense thereof, including the employment of counsel
satisfactory to such Indemnified Holder and the payment of all expenses.
Such Indemnified Holder shall have the right to employ separate
counsel in any such action and to participate in the defense thereof, but the
fees and expenses of such separate counsel shall be the expense of such
Indemnified Holder unless (i) the Company has agreed to pay such fees and
expenses, (ii) the Company shall have failed to assume the defense of such
action or proceeding or has failed to employ counsel reasonably satisfactory to
such Indemnified Holder in any such action or proceeding or (iii) the named
parties to any such action or proceeding (including any impleaded parties)
include both such Indemnified Holder and the Company, and such Indemnified
Holder shall have been advised by counsel that there may be one or more legal
defenses available to such Indemnified Holder that are different from or
additional to those available to the Company.
If such Indemnified Holder notifies the Company in writing that it
elects to employ separate counsel at the expense of the Company as permitted by
the provisions of the preceding paragraph, the Company shall not have the right
to assume the defense of such action or proceeding on behalf of such Indemnified
Holder. The foregoing notwithstanding, the Company shall not be liable for the
reasonable fees and expenses of more than one separate firm of attorneys at any
time for such Indemnified Holder and any other Indemnified Holders (which firm
shall be designated in writing by such Indemnified Holders) in connection with
any one such action or proceeding or separate but substantially similar or
related actions or proceedings in the same jurisdiction arising out of the same
general allegations or circumstances.
The Company shall not be liable for any settlement of any such
action or proceeding effected without its written consent, but if settled with
its written consent, or if there be a final judgment for the plaintiff in any
such action or proceeding, the Company agrees to indemnify and hold harmless
such Indemnified Holders from and against any loss or liability by reason of
such settlement or judgment to the extent such Indemnified Holder is entitled to
indemnification under Section 9(a).
(c) Indemnification by Holder of Registrable Securities.
Each Holder of Registrable Securities agrees to indemnify and hold
harmless the Company, its directors and officers and each Person, if any, who
controls the Company within the meaning of either Section 15 of the Securities
Act or Section 20 of the Exchange Act to the same extent as the foregoing
indemnity from the Company to such Holder, but only with respect to information
relating to such Holder furnished in writing by such Holder expressly for use in
any Registration Statement, Prospectus or preliminary prospectus. In no event,
however, shall the liability hereunder of any selling Holder of Registrable
Securities be greater than the dollar amount of the net proceeds received by
such Holder upon the sale of the Registrable Securities giving rise to such
indemnification obligation.
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In case any action or proceeding shall be brought against the
Company or its directors or officers or any such controlling person, in respect
of which indemnity may be sought against a Holder of Registrable Securities,
such Holder shall have the rights and duties given the Company and the Company
or its directors or officers or such controlling person shall have the rights
and duties given to each Holder by Sections 9(a) and 9(b) above.
(d) Contribution
If the indemnification provided for in this Section 9 is
unavailable to an indemnified party under Section 9(a) or Section 9(c) above
(other than by reason of exceptions provided in those Sections) in respect of
any Claims referred to in such Sections, then each applicable indemnifying
party, in lieu of indemnifying such indemnified party, shall contribute to the
amount paid or payable by such indemnified party as a result of such Claims in
such proportion as is appropriate to reflect the relative fault of the Company
on the one hand and of the Indemnified Holder on the other in connection with
the statements or omissions which resulted in such Claims as well as any other
relevant equitable considerations. The amount paid or payable by a party as a
result of the Claims referred to above shall be deemed to include, subject to
the limitations set forth in Section 9(b), any legal or other fees or expenses
reasonably incurred by such party in connection with investigating or defending
any action or claim.
The relative fault of the Company on the one hand and of the
Indemnified Holder on the other shall be determined by reference to, among other
things, whether the Misstatement or alleged Misstatement relates to information
supplied by the Company or by the Indemnified Holder and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such Misstatement or alleged Misstatement.
The Company and each Holder of Registrable Securities agree that
it would not be just and equitable if contribution pursuant to this Section 9(d)
were determined by pro rata allocation or by any other method of allocation
which does not take account of the equitable considerations referred to above.
Notwithstanding the provisions of this Section 9(d), an
Indemnified Holder shall not be required to contribute any amount in excess of
the amount by which (i) the total price at which the securities that were sold
by such Indemnified Holder and distributed to the public were offered to the
public exceeds (ii) the amount of any damages which such Indemnified Holder has
otherwise been required to pay by reason of such Misstatement.
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 such fraudulent
misrepresentation.
10. Exchange Act Reporting Requirements
From and after the date hereof, the Company shall timely file such
information, documents and reports as the SEC may require or prescribe under
Section 13 or 15(d) (whichever is applicable) of the Exchange Act by all Persons
to which such requirements are applicable (whether or not such requirements are
applicable to the Company. In addition, the Company shall take such other
measures and file such other information, documents and reports, as shall
hereafter be
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required by the SEC as a condition to the availability of Rule 144 under the
Securities Act (or any successor provision) and the use of Form S-3.
From and after the date hereof, the Company shall forthwith upon
request furnish any Holder of Registrable Securities (i) a written statement by
the Company that it has complied with such reporting requirements, (ii) a copy
of the most recent annual or quarterly report of the Company, and (iii) such
other reports and documents filed by the Company with the SEC as such Holder may
reasonably request in availing itself of an exemption for the sale of
Registrable Securities without registration under the Securities Act.
The purpose of the foregoing requirements are (x) to enable any
such Holder to comply with the current public information requirements contained
in paragraph (c) of Rule 144 under the Securities Act (or any successor
provision) and (y) to qualify the Company for the continued use of registration
statements on Form S-3.
11. Requirements for Participation in Underwritten Offerings
No Person may participate in any underwritten offering pursuant to
a Registration hereunder unless such Person (a) agrees to sell such Person's
Registrable Securities on the basis provided in any underwriting arrangements
approved by the Persons entitled hereunder to approve such arrangements and (b)
completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents required under the terms of such
underwriting arrangements.
12. Future Registration Rights Agreements
Except for an underwriting agreement between the Company and one
or more professional underwriters of securities, the Company shall not agree to
register any Equity Securities under the Securities Act unless such agreement
specifically provides that:
(a) the Holder of such Equity Securities may not participate in
any Demand Registration without the consent of the Holders of a majority of the
shares of the Registrable Securities included in such registration.
(b) the Holder of such Equity Securities may not participate in
any Piggyback Registration if the sale of Registrable Securities is to be
underwritten unless, if the managing underwriter limits the total number of
shares to be sold, the Holders of such Equity Securities and the Holders of
Registrable Securities are entitled to participate in such underwritten
distribution based on the order of priority set forth in Section 3 hereof; and
(c) all Equity Securities excluded from any Registration as a
result of the foregoing limitations may not be publicly offered or sold for a
period (not to exceed at least 30 days prior to the effective date and 120 days
thereafter) that the managing underwriter reasonably determines is necessary in
order to effect the underwritten public offering of Registrable Securities
registered pursuant to this Agreement.
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13. Miscellaneous
(a) Remedies
Each Holder of Registrable Securities, in addition to being
entitled to exercise all rights provided herein, in the Purchase Agreement and
granted by law, including recovery of damages, shall be entitled to specific
performance of its rights under this Agreement. The Company agrees that monetary
damages would not be adequate compensation for any loss incurred by reason of a
breach by it of the provisions of this Agreement and hereby agrees to waive the
defense in any action for specific performance that a remedy at law would be
adequate.
(b) No Inconsistent Agreements
The Company shall not on or after the date of this Agreement enter
into any agreement with respect to its securities that is inconsistent with the
rights granted to the Holders of Registrable Securities in this Agreement or
otherwise conflicts with the provisions hereof.
Except for the Other Registration Rights Agreement, the Company
has not previously entered into any agreement with respect to its securities
granting any registration rights to any Person. The rights granted to the
Holders of Registrable Securities hereunder do not in any way conflict with and
are not inconsistent with the rights granted to the Holders of the Company's
securities under any such agreements.
(c) Amendments and Waivers
The provisions of this Agreement, including the provisions of this
sentence, may not be amended, modified or supplemented, and waivers or consents
to departures from the provisions hereof may not be given unless the Company has
obtained the written consent of the Holders of at least a majority of the
outstanding shares of Registrable Securities. The foregoing notwithstanding, a
waiver or consent to departure from the provisions hereof that relates
exclusively to the rights of Holders of shares of Registrable Securities whose
shares are being sold pursuant to a Registration Statement and that does not
directly or indirectly affect the rights of other Holders of shares of
Registrable Securities may be given by the Holders of a majority of the shares
of Registrable Securities being sold.
(d) Notices
All notices and other communications provided for or permitted
hereunder shall be made in writing by hand-delivery, registered first-class
mail, telex, telecopier, or air courier guaranteeing overnight delivery:
(i) if to a Holder of Registrable Securities, at the
most current address given by such Holder to the Company in accordance
with the provisions hereof, which address initially is, with respect to
each Investor, the address set forth in the Purchase Agreement, with a
copy to Xxxxxx & Xxxxxxx, 000 00/xx/ Xxxxxx, X.X., Xxxxx 0000,
Xxxxxxxxxx, X.X. 00000, Attention: Xxxxxx X. Xxxxxx, Esq.; and
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(ii) if to the Company, initially at its address set
forth in the Purchase Agreement and thereafter at such other address,
notice of which is given in accordance with the provisions hereof, with a
copy to Xxxxxx and Xxxxx, LLP, 000 Xxxx Xxxxxx, Xxxxxx, Xxxxx 00000,
Attention: Xxxxxx X. Xxxxxx, Esq.
All such notices and communications shall be deemed to have been
duly given: at the time 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. The Company shall promptly provide a list of the most
current addresses of the Holders of Registrable Securities given to it in
accordance with the provisions hereof to any such Holder for the purpose of
enabling such Holder to communicate with other Holders in connection with this
Agreement.
(e) Successors and Assigns
This Agreement shall inure to the benefit of and be binding upon
the successors and assigns of each of the parties.
(f) Counterparts
This Agreement may be executed in any number of 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 agreement.
(g) Table of Contents and Headings
The table of contents and headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(h) Governing Law
This Agreement shall be governed by and construed in accordance
with the laws of the State New York.
(i) Severability
In the event that any one or more of the provisions contained
herein, or the application thereof in any circumstance, is held invalid, illegal
or unenforceable, the validity, legality and enforceability of any such
provision in every other respect and of the remaining provisions contained
herein shall not be affected or impaired thereby.
(j) Forms
All references in this Agreement to particular forms of
registration statements are intended to include all successor forms which are
intended to replace, or to apply to similar transactions as, the forms herein
referenced.
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(k) Entire Agreement
This Agreement and the Purchase Agreement are intended by the
parties as the final expression of their agreement and intended to be a complete
and exclusive statement of the agreement and understanding of the parties hereto
in respect of the subject matter contained herein. This Agreement and the
Purchase Agreement supersede all prior agreements and understandings between the
parties with respect to such subject matter.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement
to be duly executed, as of the day and year first above written.
AVIALL, INC.
By: /s/ Xxxxxxx X. Xxxxxx
---------------------
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President,
Law and Human Resources,
Secretary and General Counsel
CARLYLE PARTNERS III, L.P.
By: TC Group III, L.P., its General Partner
By: TC Group III, L.L.C., its General Partner
By: TC Group, L.L.C., its Managing Member
By: TCG Holdings, L.L.C., its Managing Member
By: /s/ Xxxxx X. Xxxxx
------------------
Name: Xxxxx X. Xxxxx
Title: Managing Director
CP III COINVESTMENT, L.P.
By: TC Group III, L.P., its General Partner
By: TC Group III, L.L.C., its General Partner
By: TC Group, L.L.C., its Managing Member
By: TCG Holdings, L.L.C., its Managing Member
By: /s/ Xxxxx X. Xxxxx
------------------
Name: Xxxxx X. Xxxxx
Title: Managing Director
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