INVESTOR RIGHTS AGREEMENT
THIS INVESTOR RIGHTS AGREEMENT (the "Agreement"), dated as of
January 1, 2000, is entered into by and between XXXXXXX TRUCK LEASING
CORP., a Delaware corporation (the "Company"), UNITED PARCEL SERVICE
OF AMERICA, INC., a Delaware corporation ("UPS") and UPS LOGISTICS
GROUP, INC., a Delaware corporation and a wholly owned subsidiary of
UPS (together with its successors and assigns, the "Investor").
WHEREAS, in connection with the consummation of the
transactions contemplated by the Stock Purchase Agreement, dated as
of November 12, 1999 (the "Stock Purchase Agreement"), by and among
the Company, the Investor, UPS Truck Leasing, Inc., and Xxxxxxx
Leasing Corp., the Investor will receive shares of Common Stock (as
hereinafter defined) of the Company; and
WHEREAS, the Investor and the Company desire to enter into
this Agreement to set forth (i) certain mutual rights with respect to
representation on the other party's board of directors and (ii)
certain voting and liquidity matters with respect to the shares of
Common Stock owned by the Investor.
NOW, THEREFORE, in consideration of the premises and of the
mutual agreements and covenants hereinafter set forth and other good
and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
1. Certain Definitions.
Affiliate: When used with respect to a specified Person,
another Person that directly or indirectly through one or more
intermediaries, controls or is controlled by or is under common
control with the Person specified. For purposes of the foregoing, the
term "controls" (including the correlative meanings "controlled by or
under "common control with") means the possession, direct or
indirect, of the power to direct or cause the direction of the
management and policies of a Person, whether through the ownership of
voting securities, by contract or otherwise.
Alliance Agreement: As defined in Section 8(c).
Asset Purchase Agreement: As defined in the Preamble.
Business Day: Any day other than a Saturday, Sunday or
other day on which commercial banking institutions in New York, New
York are required or authorized by law to remain closed.
Closing: As defined in the Stock Purchase Agreement.
Closing Price: As to any security, on any Trading Day
means (i) the last reported sales price, regular way, for such
Trading Day as reported on the principal national securities exchange
on which such security is listed or admitted for trading or (ii) if
such security is not listed or admitted for trading on any national
securities exchange, the last reported sales price, regular way, for
such Trading Day as reported on the National Market tier of The
Nasdaq Stock Market or, if such security is not quoted on such
National Market tier, the average of the highest bid and lowest asked
prices on such Trading Day as reported on The Nasdaq Stock Market, or
(iii) if such security is not listed or admitted to trading on any
national securities exchange or The Nasdaq Stock Market, the average
of the highest bid and lowest asked prices on such Trading Day in the
domestic over-the-counter market as reported by the National
Quotation Bureau Incorporated, or any similar successor organization.
Commission: The Securities and Exchange Commission, or any
other federal agency at the time administering the Securities Act or
the Exchange Act.
Common Stock: The Common Stock of the Company, par value
$1.00 per share.
Company Indemnified Parties: The Company, its officers,
directors, employees and agents, and each Person, if any, who
controls the Company within the meaning of either the Securities Act
or the Exchange Act, and the officers, directors, employees and
agents of the foregoing parties.
Company Nominated Director: As defined in Section 8(a).
Demand Notice: As defined in Section 2(b)(i).
Demand Registration: As defined in Section 2(a).
Derivative Security: As defined in the definition of
Registrable Securities.
Exchange Act: The Securities Exchange Act of 1934, or any
successor federal statute, and the rules and regulations of the
Commission promulgated thereunder, in each case as amended from time
to time.
Indemnified Party: A Person claiming a right to
indemnification pursuant to Section 6 of this Agreement.
Indemnifying Party: A Person required to provide
indemnification pursuant to Section 6 of this Agreement.
Investor Indemnified Parties: The Investor, its officers,
directors, employees and agents, each Person (if any) who controls
the Investor within the meaning of either the Securities Act or the
Exchange Act, and the officers, directors, employees and agents of
the foregoing parties.
Investor Nominated Director: As defined in Section 8(b).
Losses: Any losses, claims, damages or liabilities, and any
related legal or other fees and expenses.
Maximum Number: As defined in Section 3(a).
Other Holders: Holders of Common Stock of the Company other
than the Investor.
Person: Any individual, corporation, partnership, limited
partnership, limited liability partnership, limited liability
company, trust, association, organization or other entity.
Piggyback Registration: As defined in Section 3(a).
Piggyback Registration Right: As defined in Section 3(a).
Prospectus: The prospectus included in a Registration
Statement as of the date it becomes effective under the Securities
Act and, in the case of references to the Prospectus as of a date
subsequent to the effective date of the Registration Statement, as
amended or supplemented as of such date, including all documents
incorporated by reference therein, each as amended, and each
prospectus supplement relating to the offering and sale of any of the
Registrable Securities pursuant to such Registration Statement.
Registrable Securities: All of (A) the shares of Common
Stock now owned on the date hereof by the Investor and (B) any
securities of the Company or its successors issued or issuable with
respect to any shares referred to in clause (A) whether by way of
conversion, exchange, dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation or
other reorganization or otherwise.
Registration Expenses: As defined in Section 5(a).
Registration Statement: A registration statement (including
the related Prospectus) of the Company under the Securities Act on
any form selected by the Company for which the Company then qualifies
and which permits the sale thereunder of the number and type of
Registrable Securities (and any other securities of the Company) to
be included therein in accordance with this Agreement by the
applicable sellers in the manner described therein. The term
"Registration Statement" shall also include all exhibits and
financial statements and schedules and documents incorporated by
reference in such Registration Statement when it becomes effective
under the Securities Act, and in the case of the references to the
Registration Statement as of a date subsequent to the effective date,
as amended or supplemented as of such date.
Xxxxxxx Family: Xxxx X. Xxxxxxx, Xx. ("Xxxxxxx Sr."), Xxxx
X. Xxxxxxx, Xx. ("Xxxxxxx Jr."), Xxxx Xxxxxxx ("X. Xxxxxxx"), Xxxxx
X. Xxxxxx ("Xxxxxx and together with Xxxxxxx Sr., Xxxxxxx Jr. and X.
Xxxxxxx collectively referred to as "Xxxxxxx") or their Xxxxxxx
Affiliates.
(a) Xxxxxxx Affiliates shall mean:
(i) one or more members of the immediate family of a
Xxxxxxx;
(ii) a corporation the majority of the shares of which
are owned, directly or indirectly, by one or more Xxxxxxx (or one or
more members of the immediate family of a Xxxxxxx);
(iii) a trust the majority of the beneficial
interests of which are owned, directly or indirectly, by one or more
Xxxxxxx (or one or more members of the immediate family of Xxxxxxx);
or
(iv) a general or limited partnership the majority of
the partnership interests in which are owned, directly or indirectly,
by one or more Xxxxxxx (or one or more members of the immediate
family of a Xxxxxxx).
(b) For purposes of clause (a) above, "members of the
immediate family shall be limited to any child, stepchild,
grandchild, parent, stepparent, grandparent, spouse, sibling, mother-
in-law, father-in-law, son-in-law, daughter-in-law, brother-in-law,
or sister-in-law, and shall include adoptive relationships."
Securities Act: The Securities Act of 1933, or any
successor federal statute, and the rules and regulations of the
Commission promulgated thereunder, in each case as amended from time
to time.
Stockholder Expenses: As defined in Section 5(b).
Term: The two (2) year period following the termination of
the Alliance Agreement.
Trading Day: Means a day on which the principal national
securities exchange on which the Common Stock is listed or admitted
to trading, or The Nasdaq Stock Market, as applicable, if the Common
Stock is not listed or admitted to trading on any national securities
exchange, is open for the transaction of business (unless such
trading shall have been suspended for the entire day) or, if the
Common Stock is not listed or admitted to trading on any national
securities exchange or The Nasdaq Stock Market, any Business Day.
2. Demand Registration.
(a) Demand Registration Rights. The Investor shall from
the date hereof, and during the Term, have the right to require that
the Company register under the Securities Act the offer or sale of
all or a portion of the Registrable Securities, including the offer
or sale of Registrable Securities upon issuance or settlement of any
Derivative Security (any such registration is referred to as a
"Demand Registration"). The Investor shall be entitled to two (2)
Demand Registrations.
(b) Procedures for Demand Registrations.
(i) The Investor shall exercise its right to a Demand
Registration pursuant to this Section 2 by furnishing the Company
with written notice of such request (a "Demand Notice") which sets
forth the number of Registrable Securities requested to be so
registered and the Investor's intended method or methods of
distribution of such Registrable Securities.
(ii) The Company shall be entitled in its sole
discretion to delay undertaking efforts to register the Registrable
Securities pursuant to this Section 2 in order to cause the
effectiveness of the Registration Statement covering such Registrable
Securities to coincide with the next open trading window for
directors and executive officers of the Company following the release
by the Company of quarterly or annual summary statements of revenues
and earnings; provided, however, that in no event shall the Company
be permitted hereunder to delay undertaking such efforts for a period
of more than seventy-five (75) days from the date of receipt of a
Demand Notice. Subject to the foregoing sentence, the Company shall
use its best efforts to promptly file with the Commission (but in any
case within 75 days from the date of the receipt of a Demand Notice a
Registration Statement which shall cover all Registrable Securities
requested to be registered as set forth above; provided, however,
that in the event a Registration Statement is not filed within thirty
(30) days of the receipt of a Demand Notice, then the Investor may,
by prompt written notice to the Company, withdraw its Demand Notice
and thereafter the Investor shall not be deemed to have exercise its
right to a Demand Registration. Subject to the provisions of Section
2(c) below, each Registration Statement may also include securities
to be sold for the account of the Company or for any other
stockholder of the Company not holding Registrable Securities.
(c) Underwriters; Priorities.
(i) The Company shall have the right to select the
lead managing underwriter for any underwritten public offering in
connection with a Demand Registration and the Investor shall have the
right to consent to such selection, which consent shall not be
unreasonably withheld.
(ii) If the lead managing underwriter of any
underwritten public offering in connection with a Demand Registration
determines that the aggregate number of Registrable Securities to be
offered exceeds the number of shares that could be sold without
having an adverse effect on the Company or such offering (including
the price at which the Registrable Securities may be sold), then:
(A) where only the Investor is offering shares, the number
of Registrable Securities to be offered shall be reduced from the
Investor's Registrable Securities, in the amount recommended by the
lead managing underwriters; and
(B) in other cases, such reduction shall be made first,
from securities proposed to be offered by the Company and Other
Holders; and second, from the Registrable Securities requested to be
included in such offering by the Investor.
(d) No Demand Used Under Certain Circumstances;
Withdrawal.
(i) The Investor shall not be obligated to proceed
with any Demand Registration if less than 75% of the Registrable
Securities requested to be registered by the Investor are included in
such registration. If the Investor so elects not to proceed, the
Investor shall not be deemed to have requested a Demand Registration
in respect thereof.
(ii) A Demand Registration shall not be deemed to have
been effected for purposes of this Agreement until the applicable
Registration Statement shall have been declared effective under the
Securities Act by the Commission (and is not then subject to any stop
order, injunction or other order or requirement of the Commission or
other governmental agency or court for any reason) for the period
specified in Section 2(e).
(iii) The Investor may, by prompt written notice
to the Company, withdraw its Registrable Securities from inclusion in
a Registration Statement if (A) the Registration Statement does not
remain effective under the Securities Act for the period specified in
Section 2(e) due to a stop order, injunction or other order of the
Commission or other governmental agency or (B) the Investor has sold
less than sixty percent (60%) of the Registrable Securities. If such
withdrawal occurs, such registration shall not be deemed to have been
a Demand Registration by the Investor and the Company shall pay all
Stockholder Expenses in connection with such registration.
(e) Effectiveness of Registration Statement. In
connection with any Demand Registration pursuant to this Section 2,
the Company will use its best efforts to promptly prepare and file
with the Commission any amendments and supplements to the
Registration Statement and the Prospectus used in connection
therewith, and to take any other actions as may be necessary to keep
the Registration Statement and the Prospectus effective, current and
in compliance with the provisions of the Securities Act, until the
sooner to occur of (i) the sale of all of the Registrable Securities
covered by such Registration Statement in accordance with the
intended methods of distribution thereof or (ii) the 60th day
following the effective date of such Registration Statement.
3. Piggyback Registration.
(a) Notice of Piggyback Registration. If at any time
during the Term the Company proposes to register under the Securities
Act any of its securities (whether for an underwritten public
offering or otherwise and whether for the Company or any stockholder
of the Company) (other than a registration statement on Form S-4 or
Form S-8 or any successor or comparable forms, or a registration
statement filed in connection with an exchange offer or any offering
of securities solely to the Company's existing stockholders or
otherwise pursuant to a dividend reinvestment plan, stock purchase
plan or other employee benefit plan), the Company shall give written
notice to the Investor not later than twenty (20) days prior to the
anticipated filing date of the applicable Registration Statement.
The Investor shall have the right (a "Piggyback Registration Right")
to participate in such registration on the same basis as the planned
method of distribution contemplated by the proposed registration by
giving the Company a written request to register any or all of the
Investor's Registrable Securities of such same class or series in
connection with the registration described in such written notice
from the Company within five (5) days after such notice has been
given by the Company (with such request stating (i) the amount of
Registrable Securities to be included by the Investor in such
registration and (ii) any other information that the Company
reasonably requests be included in such Registration Statement) (such
registration, a "Piggyback Registration"; provided, however, that the
number of Registrable Securities the Investor may include in any
single Piggyback Registration (the "Maximum Number" shall not exceed
the greater of (i) 400,000 Registrable Securities or (ii) fifty
percent (50%) of the number of shares of Common Stock to be sold in
such offering by the Company and the Xxxxxxx Family and their
Affiliates; and provided further that the Maximum Number shall never
exceed 1,000,000 Registrable Securities. Upon receipt of such
request, the Company will, subject to the provisions of Section 3(b)
below, use its best efforts to cause all such Registrable Securities
of such same class or series requested to be included in such
Piggyback Registration to be so included.
(b) Limitation on Inclusion of Registrable Securities;
Priorities. If the proposed method of distribution in connection
with a Piggyback Registration is an underwritten public offering and
the lead managing underwriter thereof determines in good faith that
the number of such Registrable Securities to be included in such
offering would adversely affect the Company or such offering
(including an adverse effect on the price at which the securities
proposed to be registered may be sold), the number of Registrable
Securities to be offered for the account of the Investor, the Company
and any Other Holders may be reduced to the extent necessary to
reduce the total number of shares to be included in such offering to
the amount recommended by such lead managing underwriter as follows:
(A) in connection with an offering initiated by the
Company, such reduction shall be made:first, from the securities
intended to be offered by Other Holders;
(B) second, from the securities requested to be
included in such offering by the Investor and Xxxxxxx Family pro
rata based on the number of shares of Common Stock each proposes
to sell; and
(C) last, from the securities to be offered for the
account of the Company.
(ii) in connection with an offering initiated by the
Investor pursuant to Section 2, in accordance with Section
2(c)(ii)(B).
(c) Withdrawal by Investor. The Investor may elect to
withdraw its respective shares of Common Stock from inclusion in a
Piggyback Registration at any time prior to five (5) Business Days
prior to the then anticipated effective date of the applicable
Registration Statement.
(d) Underwriting Agreement. In connection with any
Piggyback Registration involving an underwritten public offering, the
Investor shall, as a condition to the Company's obligation hereunder
with respect to the Investor's Registrable Securities, enter into an
underwriting agreement or other similar arrangement in customary form
with the managing underwriters of such offering.
4. Obligations with Respect to Registration.
(a) Obligations of the Company. Whenever the Company is
obligated by the provisions of this Agreement to effect the
registration of any Registrable Securities under the Securities Act,
the Company shall:
(i) Use its best efforts to cause the applicable
Registration Statement to become effective as soon as possible (but
in no event prior to any date specified in writing to the Company by
the Investor in a Demand Notice), and to prepare and file with the
Commission any amendments and supplements to the Registration
Statement and to the Prospectus used in connection therewith as may
be necessary to keep the Registration Statement and the Prospectus
effective, current and in compliance with the provisions of the
Securities Act, during the periods when the Company is required by
this Agreement to keep the Registration Statement effective and
current.
(ii) Within a reasonable time not to exceed ten (10)
Business Days prior to filing a Registration Statement or Prospectus
or any amendment or supplement thereto (other than any amendment or
supplement in the form of a filing which the Company makes pursuant
to the Exchange Act), furnish to the Investor and each underwriter,
if any, of the Registrable Securities and other shares of Common
Stock covered by such Registration Statement copies of such
Registration Statement or Prospectus as proposed to be filed, which
documents will be subject to the reasonable review and comments of
the Investor's (and its counsel) during such period, and the Company
will not file any Registration Statement or any Prospectus or any
amendment or supplement thereto containing any statements with
respect to the Investor or the distribution of the Registrable
Securities or other shares of Common Stock to be included in such
Registration Statement for sale by the Investor if the Investor shall
object in writing at least two (2) Business Days prior to the filing.
Thereafter, the Company will furnish to the Investor and each
underwriter, if any, such number of copies of such Registration
Statement, each amendment and supplement thereto (in each case
including all exhibits thereto), the Prospectus included in such
Registration Statement (including each preliminary Prospectus), and
such other documents as the Investor or underwriter may reasonably
request in order to facilitate the disposition of the Registrable
Securities owned by the Investor.
(iii) After the filing of the Registration
Statement, promptly notify the Investor of the effectiveness thereof
and of any stop order issued or threatened by the Commission and take
all reasonable actions required to prevent the entry of such stop
order or to remove it if entered and promptly notify the Investor of
such lifting or withdrawal of such order.
(iv) Immediately notify the Investor at any time when
a Prospectus is required to be delivered under the Securities Act, of
the occurrence of an event requiring the preparation of a supplement
or amendment to such Prospectus so that, as thereafter delivered to
the purchasers of such Registrable Securities and other shares of
Common Stock, such Prospectus will not contain an untrue statement of
a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in light
of the circumstances in which they were made, not misleading and
promptly make available to the Investor any such supplement or
amendment, and the Company will promptly prepare and furnish to the
Investor a supplement to or an amendment of such Prospectus so that,
as thereafter delivered to the purchasers of such Registrable
Securities and other shares of Common Stock, such Prospectus will not
contain any untrue statement of material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances in which they were
made, not misleading.
(v) Enter into customary agreements (including an
underwriting agreement in customary form including customary
indemnification provisions) and perform its obligations under any
such agreement(s) and take such other actions as are reasonably
required in order to expedite or facilitate the disposition of such
Registrable Securities and other shares of Common Stock.
(vi) Make available for inspection by the Investor
participating in any disposition pursuant to such Registration
Statement and any attorney, accountant or other professional retained
by the Investor or underwriter, all financial and other records,
pertinent corporate documents and properties of the Company as shall
be reasonably necessary to enable them to exercise their due
diligence responsibility in connection therewith, and cause the
Company's officers, directors and employees to supply all information
reasonably requested by any of such persons in connection with such
Registration Statement. Information which the Company determines, in
good faith, to be confidential and notifies such Persons is
confidential shall not be disclosed by such Persons unless (i) the
release of such information is ordered pursuant to a subpoena or
other order from a court, or other governmental agency or tribunal,
of competent jurisdiction or (ii) such information becomes public
other than through a breach by any such Person of the confidentiality
obligations of such Persons.
(vii) Provide, in the case of an underwritten
public offering of Registrable Securities or other shares of Common
Stock, pursuant to a request for a Demand Registration, for
participation and cooperation by officers and employees of the
Company for a maximum period of three (3) days per Demand
Registration (including travel) in customary "road show
presentations. The Company and its senior management shall use their
good faith efforts to assist the Investor in the sale of the
Registrable Securities.
(viii) Furnish, in the case of an underwritten
public offering, to the Investor and to each underwriter a signed
counterpart of (A) an opinion or opinions of outside counsel to the
Company addressed to the Investor and underwriters (on which opinion
the Investor and each such underwriter shall be entitled to rely) and
(B) a comfort letter or comfort letters from the Company's
independent public accountants, each in customary form and covering
such matters of the type customarily covered by opinions or comfort
letters, as the case may be, as the holders of a majority of the
shares of Common Stock included in such Registration Statement or the
managing underwriter therefor reasonably requests.
(ix) Register or qualify the Registrable Securities
and other shares of Common Stock covered by a Registration Statement
under the securities or blue sky laws of such United States
jurisdictions as the Investor shall reasonably request, and do any
and all other acts and things which may be necessary to enable the
Investor to consummate the disposition in such jurisdictions of such
Registrable Securities and other shares of Common Stock,
respectively, in accordance with the method of distribution described
in such Registration Statement; provided, that the Company shall in
no event be required (A) to qualify to do business as a foreign
corporation in any jurisdiction where it is not otherwise required to
be so qualified, (B) to conform its capitalization or the composition
of its assets at the time to the securities or blue sky laws of such
jurisdiction, (C) to execute or file any general consent to service
of process under the laws of any jurisdiction or (D) to subject
itself to taxation in any jurisdiction where it has not theretofore
done so.
(x) Use its best efforts to cause such Registrable
Securities and other shares of Common Stock covered by a Registration
Statement to be listed on the principal exchange or exchanges or
qualified for trading on the principal over the counter market on
which securities of the same class and series as the Registrable
Securities (or into which such Registrable Securities will be or have
been converted) and other shares of Common Stock are then listed or
traded upon the sale of such Registrable Securities and/or shares of
Common Stock pursuant to such Registration Statement.
(xi) Make and keep information publicly available
relating to the Company so as to satisfy the requirements of Rule 144
under the Securities Act (or any successor or corresponding rule) and
file with the Commission all reports and other documents required of
the Company under the Securities Act and the Exchange Act in a timely
manner.
(xii) Make available to its security holders, as
soon as reasonably practicable, an earnings statement covering the
period of at least twelve months, but not more than eighteen months,
which earnings statement shall satisfy the provisions of Section
11(a) of the Securities Act, and not file any amendment or supplement
to such Registration Statement or Prospectus to which any of the
Investor or other selling stockholders shall have reasonably objected
on the grounds that such amendment or supplement does not comply in
all material respects with the requirements of the Securities Act.
(b) Selling Stockholders' Obligations. The Company's
obligations under this Agreement to the Investor shall be conditioned
upon the Investor's compliance with the following:
(i) The Investor shall cooperate with the Company in
connection with the preparation of the Registration Statement, and
for so long as the Company is obligated to keep the Registration
Statement effective, the Investor will provide to the Company, in
writing, for use in the Registration Statement, all information
regarding the Investor, its intended method of disposition of the
applicable Registrable Securities and other shares of Common Stock,
and such other information as the Company may reasonably request to
prepare the Registration Statement and Prospectus covering the
Registrable Securities and other shares of Common Stock and to
maintain the currency and effectiveness thereof.
(c) The Investor agrees that, upon receipt of any notice
from the Company of the happening of any event of the kind described
in Section 4(a)(iv), the Investor will forthwith discontinue its
offering and sale of Registrable Securities or other shares of Common
Stock pursuant to the applicable Registration Statement until the
Investor's receipt of the copies of the supplemented or amended
Prospectus contemplated by Section 4(a)(iv), and, in either case, if
so directed by the Company, the Investor will deliver to the Company
all copies in its possession of the most recent Prospectus covering
such Registrable Securities and other shares of Common Stock at the
time of receipt of such notice.
(d) Underwriting Agreement. Neither the Company nor any
other Person may participate in any underwritten public offering in
connection with a Demand Registration or a Piggyback Registration
unless such Person (i) agrees to sell its securities on the basis
provided in any underwriting arrangements approved by the Person or
Persons selecting the lead managing underwriter(s) for such offering
and (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents
reasonably required under the terms of such underwriting arrangements
and this Agreement.
(e) Holdback. The Company agrees not to engage in any
public sale or distribution of any securities of the same class or
series as the Registrable Securities or securities convertible into,
or exchangeable or exercisable for, or the value of which relates to
or is based upon, such securities (other than on Forms X-0, X-0 or
any successor or comparable forms, or any registrations pursuant to a
dividend reinvestment plan, stock purchase plan or other employee
benefit plan) during the ten days prior to and during the 90-day
period (or such longer period as is requested by the underwriter)
beginning on the effective date of any Registration Statement filed
pursuant to any Demand Registration, but not including the delivery
of Registrable Securities, except as part of such registration. The
Company agrees to cause each holder of privately placed equity
securities purchased after the date of this agreement and each
stockholder with which it enters into registration rights or similar
arrangements to agree to the restriction contained in the first
sentence of this subsection (e).
5. Expenses of Registration.
(a) Registration Expenses. Except as provided in
paragraphs (b) and (c) below, all Registration Expenses incurred in
connection with any Demand Registration or Piggyback Registration and
the distribution of any Registrable Securities or other shares of
Common Stock in connection therewith shall be borne by the Company.
For purposes of this Agreement, the term "Registration Expenses"
shall mean all (i) registration, qualification and filing fees, (ii)
fees and expenses of compliance with securities or blue sky laws,
(iii) printing expenses (or comparable duplication expenses),
delivery charges and escrow fees, (iv) fees and disbursements of
counsel for the Company, (v) fees and expenses for independent
certified public accountants retained by the Company (including the
expenses of any comfort letters or costs associated with the delivery
by independent certified public accountants of a comfort letter or
comfort letters, and fees and expenses relating to the preparation of
any related review of Company matters pursuant to Statement of
Accounting Standards 71, "Interim Financial Information"in connection
therewith), (vi) fees and expenses of any special experts retained by
the Company in connection with such registration, (vii) fees and
expenses of listing the Registrable Securities or other shares of
Common Stock covered by the Registration Statement on a securities
exchange or over the counter market, and (viii) expenses associated
with compliance with any other provision of this Agreement, including
Section 4(a)(vii).
(b) Stockholder Expenses. The Investor shall pay all
stock transfer fees or expenses (including the cost of all transfer
tax stamps), if any, all underwriting or brokerage discounts and
commissions and all fees and disbursements of counsel for the
Investor attributable to the distribution of the Registrable
Securities.
(c) Internal Expenses of the Company. Notwithstanding any
other provision of this Agreement, the Company shall be obligated to
bear all internal expenses of the Company in connection with any
Demand Registration or Piggyback Registration (including, without
limitation, all salaries and expenses of its officers and employees
performing accounting and legal functions and related expenses).
6. Indemnification.
(a) By the Company. The Company agrees to indemnify and
hold harmless each Investor Indemnified Party from and against any
Losses to which such Investor Indemnified Party may become subject
under the Securities Act, the Exchange Act, state securities or blue
sky laws, common law or otherwise, insofar as such Losses (or actions
in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in
the applicable Registration Statement or Prospectus, or any omission
or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein, in light
of the circumstances under which they were made, not misleading, and
the Company will reimburse each such Investor Indemnified Party for
any reasonable fees and expenses of outside legal counsel for such
Investor Indemnified Parties, or other expenses reasonably incurred
by them, as incurred, in connection with investigating or defending
any such claims; provided, that the Company will not indemnify or
hold harmless any Investor Indemnified Party from or against any such
Losses (including any related expenses) to the extent such Losses
(including any related expenses) result from an untrue statement,
omission or allegation thereof which were made in reliance upon and
in conformity with written information provided by or on behalf of
the Investor specifically for use or inclusion in the applicable
Registration Statement or Prospectus; provided, further, that if an
Indemnified Party is an Investor Nominated Director (as defined in
Section 8(b)), such Indemnified Party shall be indemnified hereunder
only for Losses incurred as a result of such Person's relationship to
the Investor and not for Losses incurred as a result of services as a
director. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of the Investor
Indemnified Parties and shall survive the transfer of such securities
by the Investor.
(b) By Investor. The Investor agrees to indemnify and
hold harmless each Company Indemnified Party from and against any
Losses to which such Company Indemnified Party may become subject,
insofar as such Losses (or actions in respect thereof) arise out of
or are based upon any untrue statement or alleged untrue statement of
a material fact contained in the applicable Registration Statement or
the Prospectus, or any omission or alleged omission to state therein
a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which
they were made, not misleading, if the statement or omission was made
in reliance upon and in conformity with written information provided
by or on behalf of the Investor or any person who controls the
Investor specifically for use or inclusion in the applicable
Registration Statement or Prospectus; provided, that the Investor
will not indemnify or hold harmless any Company Indemnified Party
from or against any such Losses (including any related expenses) (i)
to the extent the untrue statement, omission or allegation thereof
upon which such Losses (including any related expenses) are based was
made in any Prospectus used after such time as the Investor advised
the Company that the filing of a post-effective amendment or
supplement thereto was required, except the Prospectus as so amended
or supplemented, or (ii) in an amount that exceeds the net proceeds
received by the Investor from the sale of Registrable Securities
pursuant to such Registration Statement. Such indemnity shall remain
in full force and effect regardless of any investigation by or on
behalf of the Company Indemnified Parties, and shall survive the
transfer of such securities by the Investor.
(c) Procedures. Each Indemnified Party shall give notice
to each Indemnifying Party promptly after such Indemnified Party has
actual knowledge of any claim as to which indemnity may be sought,
and the Indemnifying Party may participate at its own expense in the
defense, or if it so elects, assume the defense of any such claim and
any action or proceeding resulting therefrom, including the
employment of counsel and the payment of all expenses. The failure
of any Indemnified Party to give notice as provided herein shall not
relieve the Indemnifying Party from its obligations to indemnify such
Indemnified Party, except to the extent the Indemnified Party's
failure to so notify actually prejudices the Indemnifying Party's
ability to defend against such claim, action or proceeding. In the
event that the Indemnifying Party elects to assume the defense in any
action or proceeding, an Indemnified Party shall have the right to
employ separate counsel in any such action or proceeding and to
participate in the defense thereof, but such Indemnified Party shall
pay the fees and expenses of such separate counsel unless (i) the
Indemnifying Party has agreed to pay such fees and expenses or (ii)
the named parties to any such action or proceeding (including any
impleaded parties) include such Indemnified Party and the
Indemnifying Party, and such Indemnified Party shall have been
advised by counsel in a written opinion that there is or would be a
conflict of interest between such Indemnified Party and the
Indemnifying Party in the conduct of the defense of such action (in
which case, if such Indemnified Party notifies the Indemnifying Party
in writing that it elects to employ separate counsel at the expense
of the Indemnifying Party, the Indemnifying Party shall not assume
the defense of such action or proceeding on such Indemnified Party's
behalf, it being understood, however, that the Indemnifying Party
shall not, in connection with any one such action or proceeding or
separate but substantially similar or related actions or proceedings
arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of more than one separate
firm of attorneys for all Indemnified Parties, which firm shall be
designated in writing by the applicable Indemnified Parties;
provided, however, that the Indemnifying Party shall be liable for up
to two separate firms of attorneys for the Indemnified Parties as are
required if, as to any Indemnified Party, such Indemnified Party
shall have been advised by counsel in a written opinion that there is
or would be a conflict of interest between such Indemnified Party and
any other Indemnified Party in the conduct of the defense of such
action). No Indemnifying Party, in the defense of any such claim or
litigation, shall, except with the consent of the Indemnified Party
(which consent will not be unreasonably withheld), consent to entry
of any judgment or enter into any settlement which does not include
as an unconditional term thereof the giving by the claimant or
plaintiff to such Indemnified Party of a release from all liability
in respect to such claim or litigation.
(d) Contribution. If the indemnification provided for
under this Section 6 is unavailable to or insufficient to hold the
Indemnified Party harmless under subparagraphs (a), (b) or (c) above
in respect of any Losses referred to therein for any reason other
than as specified therein, then the Indemnifying Party shall
contribute to the amount paid or payable by such Indemnified Party as
a result of such Losses in such proportion as is appropriate to
reflect the relative fault of the Indemnifying Party, on the one
hand, and such Indemnified Party, on the other, in connection with
the statements or omissions which resulted in such Losses. The
relative fault of each Indemnifying Party or Indemnified Party, as
the case may be, shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact
relates to information supplied by (or which was failed to be
supplied by) such Indemnifying Party or Indemnified Party, such
party's relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. If
contribution based upon the relative fault of the Indemnifying Party,
on the one hand, and the Indemnified Party, on the other hand, is not
available, then the Indemnifying Party shall contribute to the amount
paid or payable by Indemnified Party as a result of Losses in such
proportion as is appropriate to reflect the relative benefits
received by the Indemnifying Party, on the one hand, and such
Indemnified Party, on the other, from the subject offering or
distribution. The relative benefits received by the Indemnifying
Party, on the one hand, and the Indemnified Party, on the other,
shall be deemed to be in the same proportion as the net proceeds of
the offering or other distribution received by the Indemnifying Party
bears to the net proceeds of the offering or other distribution
received by the Indemnified Party. 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.
7. Limitation on Other Registration Rights. Notwithstanding
any other provision of this Agreement, without the prior written
consent of the Investor, the Company shall not grant to any person
any registration rights that have provisions that conflict with any
of the rights granted to the Investor herein or that would cause the
Investor's rights to be subordinated.
8. Board Representation.
(a) The Company reserves the right to require that UPS
elect an individual nominated by the Company ("Company Nominated
Director" to the Board of Directors of the Investor (the "Investor
Board" and shall reelect a Company Nominated Director at each annual
meeting thereafter during the Board Term (as hereinafter defined).
Any change in the structure or classification of the Investor Board
shall not affect the Company's right to have its nominee nominated
for election to the Investor Board. Upon the termination, removal or
resignation of a Company Nominated Director for any reason, the
Company shall have the right to nominate a new Company Nominated
Director to fill such vacancy, and the Investor shall use its best
efforts to cause the election of such new Company Nominated Director
to the Investor Board through action of the Investor Board or UPS, in
either case at the discretion of the Investor Board or UPS,
respectively. Further, if a Company Nominated Director shall not be
elected as a director at any election, then the Investor shall use
its best efforts to ensure that the Company Nominated Director
obtains a seat on the Investor Board as soon as reasonably possible,
whether by appointment of the Company Nominated Director to fill an
existing or newly created vacancy on the Investor Board, by
nomination at the next election of directors of the Investor or
otherwise, provided that this provision shall not restrict the
discretion of the Investor Board or UPS, respectively.
(b) Investor reserves the right to require that the Board
of Directors of Company (the "Company Board" appoint a nominee of the
Investor ("Investor Nominated Director" to the Company Board and in
connection therewith, the Company shall use its best efforts to amend
its certificate of incorporation at the January 28, 2000 annual
meeting in order to create the vacancy necessary to effect such an
appointment. Thereafter, the Company Board shall elect and recommend
to its stockholders an Investor Nominated Director for re-election to
the Company Board at each annual meeting thereafter during the Board
Term. The Company Board shall elect the Investor Nominated Director
to serve on the Audit Committee of the Company Board to the extent
permitted under applicable rules of the Commission and the New York
Stock Exchange. Any change in the structure or classification of the
Company Board shall not affect the Investor's right to have its
nominee nominated for election to the Company Board. Upon the
termination, removal or resignation of an Investor Nominated Director
for any reason, the Investor shall have the right to nominate a new
Investor Nominated Director to fill such vacancy, and the Company
shall use its best efforts to cause the election of such new Investor
Nominated Director to the Company Board through action of the Company
Board or stockholders, in either case at the discretion of the
Company Board or stockholders, respectively. Further, if an Investor
Nominated Director shall not be elected as a director at any
election, then the Company shall use its best efforts to ensure that
the Investor Nominated Director obtains a seat on the Company Board
as soon as reasonably possible, whether by appointment of the
Investor Nominated Director to fill an existing or newly created
vacancy on the Company Board, by nomination at the next election of
directors of the Company or otherwise, in either case at the
discretion of the Company Board or stockholders, respectively.
(c) Upon the earlier to occur of (i) the termination of
the Strategic Alliance Agreement by and between the Company, the
Investor, Worldwide Dedicated Services, Inc. and Xxxxxxx Leasing
Corp., dated as of the date hereof (the "Alliance Agreement") or (ii)
the Investor and its Affiliates ceasing to own at least 1,000,000
shares of Common Stock of Company (the "Board Term"), the Company
will cause the Company Nominated Director, and the Investor will
cause the Investor Nominated Director, to resign immediately from
his/her respective Board positions, and the obligations of the
Investor and Company in Sections 8(a) and (b) shall cease.
(d) Notwithstanding anything set forth in this Agreement,
the Company agrees that the right to require UPS to elect a Company
Nominated Director to the Investor Board, as outlined in Section
8(a), shall not be exercised unless and until Investor requires the
Company Board to appoint an Investor Nominated Director, as set forth
in Section 8(b).
9. Voting Agreement. On each matter presented for a vote of
the stockholders of the Company, the Investor shall vote its shares
of Common Stock either (i) in accordance with the recommendation of
the Company Board or (ii) in the same percentages for and against
such matter as the votes, cast by stockholders of the Company other
than the Investor. Such obligation shall continue for two years
following the termination of the Alliance Agreement.
10. Miscellaneous.
(a) Notices. All notice, requests, demands, waivers and
other communications hereunder shall be in writing and shall be
deemed to have been duly given if delivered personally, mailed,
certified or registered mail with postage prepaid, or sent by UPS
next day air or document exchange, or facsimile transmission, as
follows:
(i) if to the Company:
Xxxxxxx Truck Leasing Corp.
0000 Xxxxxxx Xxxx
Xxx Xxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Fax No: (000) 000-0000
Attn: Xxxxxxx X. Xxxxxx
with a copy to :
Xxxxxxx Leasing Corp.
0000 Xxxxxxx Xxxx
Xxx Xxxxxxx Xxxxx
Xxxxxxxxxx, XX 00000
Fax No: (000) 000-0000
Attn: Xxxxx X. Xxxxxxxxxx
(ii) if to the Investor:
UPS Logistics Group, Inc.
c/o United Parcel Service, Inc.
00 Xxxxxxxx Xxxxxxx
Xxxxxxx, Xxxxxxx 00000
Fax No.: (000) 000-0000
Attn: Legal Department
with a copy to:
United Parcel Service, Inc.
00 Xxxxxxxx Xxxxxxx
Xxxxxxx, Xxxxxxx 00000
Fax No.: (000) 000-0000
Attn: Legal Department
and to:
King & Spalding
000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Fax No.: (000) 000-0000
Attn: Xxxxxxx X. Xxxx III
or to such other person or address as any party shall specify by
notice in writing to the other party. All notices and other
communications given to a party in accordance with the provisions of
this Agreement shall be deemed to have been given (i) three (3)
Business Days after the same are sent by certified or registered
mail, postage prepaid, return receipt requested, (ii) upon receipt
when delivered by hand or transmitted by facsimile (confirmation
received) or (iii) one (1) Business Day after the same are sent by a
reliable overnight courier service, with acknowledgment of receipt
requested. Notwithstanding the preceding sentence, notice of change
of address shall be effective only upon actual receipt thereof.
(b) Amendment. Any provision of this Agreement may be
amended or modified in whole or in part at any time by an agreement
in writing among the parties hereto, executed in the same manner as
this Agreement. No consent, waiver or similar act shall be effective
unless in writing.
(c) Entire Agreement. This Agreement constitutes the
entire agreement among the parties hereto and supersedes all prior
agreements and understandings, oral and written, among the parties
hereto with respect to the subject matter hereof.
(d) Counterparts. This Agreement may be executed in two
or more counterparts, each of which shall be deemed to be an
original, but all of which together shall constitute one and the same
instrument.
(e) Governing Law. This Agreement shall be governed by
and interpreted in accordance with the internal laws of the State of
New York, without giving effect to principles of conflicts of laws.
(f) Assignment. This Agreement shall be binding upon
and inure to the benefit of the parties hereto and their respective
successors and assigns. Any holder of Registrable Securities may
transfer any of its rights hereunder to all of the Registrable
Securities then held by such holder, without the consent of the
Company, to any Affiliate that is a direct or indirect subsidiary of
United Parcel Service, Inc. ("UPS, Inc.") or to any entity in which
UPS, Inc. has or one of its subsidiaries has a majority ownership
interest, whether such transfer is by sale, gift, assignment, pledge
or otherwise. The Company shall be given written notice by the
assigning party at the time of such assignment stating the name and
address of the assignee, identifying the securities of the Company as
to which the rights in question are being assigned and providing a
description of the nature and extent of the rights that are being
assigned. Any assignee hereunder shall receive such assigned rights
subject to all the terms and conditions of this Agreement, including,
without limitation, the provisions of this Section.
(g) Binding Agreement; No Third Party Beneficiaries.
This Agreement will be binding upon and inure to the benefit of the
parties hereto and their successors and permitted assigns.
(h) Changes in Xxxxxxx Common Stock. To the extent that
there are any changes in the Common Stock by way of stock split,
stock dividend, combination or reclassification, or through merger,
consolidation, reorganization or recapitalization, or by any other
means, appropriate adjustment shall be made in the provisions hereof,
as may be required, so that the rights and privileges granted to the
Investor hereunder shall continue with respect to the Registrable
Securities as so changed.
IN WITNESS WHEREOF, the parties hereto have executed this
Agreement as of the date first above written.
XXXXXXX TRUCK LEASING CORP.
By:___________________________________
Name:
Title:
UPS LOGISTICS GROUP, INC.
By:___________________________________
Name:
Title:
UNITED PARCEL SERVICE OF AMERICA, INC.
By:___________________________________
Name:
Title:
