Exhibit 10.3
METALDYNE CORPORATION
TERMS OF PREFERRED STOCK INVESTOR RIGHTS AGREEMENT
Terms used with initial capitals but not defined herein are used as defined
in the Amended and Restated Operating Agreement of NC-M Chassis Systems, LLC
(the "Operating Agreement").
There will be a Preferred Stock Investor Rights Agreement that provides for
(1) a registered exchange offer of Series A-2 Preferred Stock for Series A-1
Preferred Stock pursuant to a registration statement filed with the SEC or, if
for any reason an exchange offer is unavailable, a shelf registration statement
filed with the SEC covering the Series A-1 Preferred Stock and (2) certain
information and board observer rights. The registration rights will be
substantially the same as those applicable to registration rights agreement that
will relate to the Notes, but with the substantive differences set forth below.
A. Registration Rights.
1. Parties. The initial holders of the Series A-1 Preferred Stock and
Metaldyne.
2. Trigger for Registration Rights. Metaldyne's obligation to commence
an SEC registration process will be triggered off of a written request by
DaimlerChrysler, on its behalf and on behalf of other holders of Series A-1
Preferred Stock, following a sale of 25% or more of the outstanding shares
of Series A-1 Preferred Stock to any person or persons other than
Affiliates of DaimlerChrysler. Once triggered, the time periods for
effecting the registration rights will be as set forth in the registration
rights agreement relating to the Notes. In no event will Metaldyne be
required to effect a registration with respect to shares of preferred stock
that have been sold pursuant to Rule 144 or are eligible for resale
pursuant to Rule 144(k) (or any similar provision then in force, but not
Rule 144A).
3. Procedures and Other Provisions. The procedures and mechanics for
registering, as well as the penalty provisions for non-compliance, will be
identical to the registration rights agreement relating to the Notes with
appropriate adjustments to reflect that a preferred stock is being
exchanged. In the event that a shelf registration is required, there will
be suspension rights for up to 90 days in any 365 day period if Metaldyne's
board of directors determines in its reasonable good faith judgment that
there is a valid business reason to do so, such as a potential acquisition,
divestiture of assets or other material corporate transaction.
4. Exchange Notes. At the time of any registration of the Series A-1
Preferred Stock, the exchange notes underlying the Series A-1 or Series A-2
Preferred Stock, as applicable, will be registered and qualified under the
Trust Indenture Act to permit their issuance on a registered basis should
Metaldyne ever exercise its exchange right.
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B. Other Rights.
1. Observer Rights. For so long as DaimlerChrysler and its Affiliates
beneficially own at least $5 million of Series A-1 or A-2 Preferred Stock,
DaimlerChrysler will be entitled to receive notices of Metaldyne Board
meetings (at the same time that members of Metaldyne's board receive such
notices) and shall be entitled to attend such meetings and will be entitled
to receive copies of any materials provided to Metaldyne's Board members
except to the extent such materials relate to matters described in the next
sentence. However, Metaldyne will be permitted to notify DaimlerChrysler
and its Affiliates that they are to be excluded from any portion of any
meeting that (1) involves matters relating to competitors of
DaimlerChrysler and its Affiliates, (2) involves matters pertaining to
Metaldyne's relationship with DaimlerChrysler and its Affiliates, (3) based
on advice of counsel, raises anti-competitive or antitrust, similar
concerns under any laws or policies of any government or instrumentality
thereof or (4) otherwise involves matters that, in the reasonable judgment
of Metaldyne, if known to DaimlerChrysler or its Affiliates, could have an
adverse impact on its business, commercial relationships or business plans
or strategies. All information made available to DaimlerChrysler will be
subject to confidentiality provisions to be included in the Preferred Stock
Investors Rights Agreement and to be substantially similar in scope to the
confidentiality provisions set forth in Section 4.04(e) and (f) of the
Shareholders' Agreement, dated as of November 28, 2000, by and among
Metaldyne and the other parties thereto, with limitations on the ability of
the recipient to use the information for any purpose other than monitoring
the investment, as well as the other restrictions contained therein. In no
event will Metaldyne be responsible for any securities law liability to
which DaimlerChrysler and its Affiliates may be subject by reason of
trading in securities of Metaldyne at a time when it is in possession of
material non-public information. These observer rights may be declined by
DaimlerChrysler in its sole discretion for such period or periods of time
as it wishes; provided that no such decline shall prevent DaimlerChrysler
from electing to exercise such observer rights in future periods. These
observer rights are non-assignable, except to Affiliates of
DaimlerChrysler.
2. Information Rights. For so long as DaimlerChrysler and its
Affiliates beneficially owns at least $5 million of Series A-1 or A-2
Preferred Stock, DaimlerChrysler will be entitled to receive the following:
(1) annual consolidated balance sheets and statements of income,
stockholders' equity and cash flows of the Company within 90 days of fiscal
year-end, prepared in accordance with GAAP; (2) quarterly consolidated
balance sheets and statements of income, stockholders' equity and cash
flows of the Company within 45 days of quarter end, prepared in accordance
with GAAP; and (3) such other information as may be reasonably requested
concerning the condition or operations, financial or otherwise, of
Metaldyne, subject to the confidentiality and other limitations described
above with respect to observer rights.
