EXHIBIT 10.56
REGISTRATION RIGHTS AGREEMENT
among
HEXCEL CORPORATION,
BERKSHIRE FUND V, LIMITED PARTNERSHIP
BERKSHIRE FUND VI, LIMITED PARTNERSHIP
BERKSHIRE INVESTORS LLC,
GREENBRIAR CO-INVESTMENT PARTNERS, L.P.,
and
GREENBRIAR EQUITY FUND, L.P.
Dated as of March 19, 2003
This REGISTRATION RIGHTS AGREEMENT (this "Agreement"), is made as of
March 19, 2003, among Hexcel Corporation, a Delaware corporation (the
"Company"), Berkshire Fund V, Limited Partnership, a Massachusetts limited
partnership ("Berkshire V"), Berkshire Fund VI, Limited Partnership, a
Massachusetts limited partnership ("Berkshire VI"), Berkshire Investors LLC, a
Massachusetts limited liability company ("Berkshire LLC"), Greenbriar
Co-Investment Partners, L.P., a Delaware limited partnership ("Greenbriar
Co-Investment"), and Greenbriar Equity Fund, L.P., a Delaware limited
partnership ("Greenbriar Equity" and, together with Greenbriar Co-Investment,
Berkshire V, Berkshire VI and Berkshire LLC, the "Investors").
WHEREAS, the Investors have entered into a Stock Purchase Agreement
(the "Stock Purchase Agreement"), dated as of December 18, 2002, with the
Company, pursuant to which, upon the terms and subject to the conditions
contained therein, each has agreed to purchase shares of Series A Convertible
Preferred Stock and Series B Convertible Preferred Stock (as such terms are
defined below) from the Company;
WHEREAS, simultaneously herewith, the Investors and the Company are
executing and delivering a Stockholders Agreement (the "Stockholders Agreement")
providing, among other things, for certain rights and obligations with respect
to the ownership of the shares of Series A Convertible Preferred Stock and
Series B Convertible Preferred Stock acquired by the Investors pursuant to the
Stock Purchase Agreement and shares of the Common Stock issuable upon conversion
of such shares of Series A Convertible Preferred Stock and Series B Convertible
Preferred Stock; and
WHEREAS, (i) in connection with the execution and delivery by the
Investors of the Stock Purchase Agreement and the consummation of the
transactions contemplated thereby and (ii) to induce the Investors to execute
and deliver the Stockholders Agreement and to consummate the transactions
contemplated thereby, the Company has agreed to provide the Investors with the
registration rights set forth in this Agreement.
ACCORDINGLY, the parties hereto agree as follows:
1. Certain Definitions.
As used in this Agreement, capitalized terms not otherwise defined
herein shall have the meanings ascribed to them below:
"Affiliate" means (i) with respect to any Person, any other Person
directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person or (ii) with respect to any
individual, shall also mean the spouse or child of such individual; provided,
that neither the Company nor any Person controlled by the Company shall be
deemed to be an Affiliate of any Holder.
"Certificate of Incorporation" means the Certificate of Incorporation
of the Company, as amended and in effect on the date hereof.
"Common Stock" means the common stock, par value $.01 per share, of
the Company and any equity securities issued or issuable in exchange for or with
respect to the Common Stock by way of a stock dividend, stock split or
combination of shares or in connection with a reclassification,
recapitalization, merger, consolidation or other reorganization.
"Common Stock Equivalents" means all options, warrants and other
securities convertible into, or exchangeable or exercisable for, (at any time or
upon the occurrence of any event or contingency and without regard to any
vesting or other conditions to which such securities may be subject), Common
Stock.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Expenses" means any and all fees and expenses incurred in connection
with the Company's performance of or compliance with Article 2, including,
without limitation: (i) SEC, stock exchange or NASD registration and filing fees
and all listing fees and fees with respect to the inclusion of securities on the
New York Stock Exchange or on any securities market on which the Common Stock is
listed or quoted, (ii) fees and expenses of compliance with state securities or
"blue sky" laws and in connection with the preparation of a "blue sky" survey,
including without limitation, reasonable fees and expenses of blue sky counsel,
(iii) printing and copying expenses, (iv) messenger and delivery expenses, (v)
expenses incurred in connection with any road show, (vi) fees and disbursements
of counsel for the Company, (vii) with respect to each registration, the fees
and disbursements (which shall not exceed $75,000 per registration) of one
counsel for the selling Holder(s) (selected by the Majority Participating
Holders, in the case of a registration pursuant to Section 2.1, and selected by
the underwriter, in the case of a registration pursuant to Section 2.2), (viii)
fees and disbursements of all independent public accountants (including the
expenses of any audit and/or "cold comfort" letter) and fees and expenses of
other persons, including special experts, retained by the Company, (ix) fees and
expenses payable to a Qualified Independent Underwriter (as such term is defined
in Schedule E to the By-Laws of the NASD) and (x) any other fees and
disbursements of underwriters, if any, customarily paid by issuers of
securities.
"Goldman Holders" means any of LXH L.L.C., a Delaware limited
liability company ("LXH") , LXH II, L.L.C., a Delaware limited liability company
("LXH II" and, together with LXH, the "LXH Investors"), GS Capital Partners
2000, L.P., a Delaware limited partnership, GS Capital Partners 2000 Offshore,
L.P., a Cayman Islands exempted limited partnership, GS Capital Partners 2000
Employee Fund, L.P., a Delaware limited partnership, GS Capital Partners 2000
GmbH & Co. Beteiligungs KG, a German limited partnership, and Stone Street Fund
2000, L.P., a Delaware limited partnership (collectively, the "Goldman
Investors") and any Person who shall hereafter acquire and hold Goldman
Registrable Securities in accordance with the terms of the Amended and Restated
Governance Agreement (the "Governance Agreement"), dated March 19, 2003 among
the Company and the Goldman Investors.
"Goldman Registrable Securities" means (a) any shares of Common Stock
held by the Goldman Holders on the date hereof, (b) any shares of Common Stock
issued
or issuable, directly or indirectly, upon conversion or redemption of shares of
Series A Convertible Preferred Stock held by the Goldman Holders (including,
without limitation, in satisfaction of a Conversion Payment (as such term is
defined in the Series A Convertible Preferred Stock Certificate of Designations
(as defined below)) or any payment of shares upon a redemption under such
Certificate), (c) any shares of Common Stock issued or issuable, directly or
indirectly, upon conversion or redemption of shares of Series B Convertible
Preferred Stock held by the Goldman Holders (including, without limitation, in
satisfaction of any payment of shares upon a redemption under the Series B
Convertible Preferred Stock Certificate of Designations (as defined below)), (d)
any shares of Common Stock issued or issuable, directly or indirectly in
exchange for or with respect to the Common Stock referenced in clause (a) above
by way of stock dividend, stock split or combination of shares or in connection
with a reclassification, recapitalization, merger, consolidation or other
reorganization, (e) any shares of Series A Convertible Preferred Stock held by
the Goldman Holders; PROVIDED, HOWEVER that the shares of Series A Convertible
Preferred Stock shall not be deemed to be Goldman Registrable Securities until
the date that is three years from the date hereof and (f) any shares of Common
Stock acquired by the Goldman Holders from third parties after the date hereof
for so long as such Goldman Holder is an Affiliate of the Company. As to any
particular Goldman Registrable Securities, such securities shall cease to be
Goldman Registrable Securities when (A) a registration statement with respect to
the sale of such securities shall have been declared effective under the
Securities Act and such securities shall have been disposed of in accordance
with such registration statement, or (B) such securities shall have been sold
(other than in a privately negotiated sale) pursuant to Rule 144 (or any
successor provision) under the Securities Act and in compliance with the
requirements of paragraphs (f) and (g) of Rule 144 (notwithstanding the
provisions of paragraph (k) of such Rule).
"Goldman Registration Rights Agreement" means the Amended and Restated
Registration Rights Agreement, dated as of the date hereof, between the Company
and the Goldman Investors.
"Holder" or "Holders" means any Person who is a signatory to this
Agreement and any Person who shall hereafter acquire and hold Registrable
Securities in accordance with the terms of the Stockholders Agreement.
"Majority Participating Holders" means Participating Holders holding
more than 50% of the Registrable Securities proposed to be included in any
offering of Registrable Securities by such Participating Holders pursuant to
Section 2.1 or Section 2.2 hereto.
"Person" means any individual, corporation, limited liability company,
limited or general partnership, joint venture, association, joint-stock company,
trust, unincorporated organization or government or any agency or political
subdivisions thereof.
"Registrable Securities" means (a) any shares of Common Stock held by
the Holders, provided that, to the extent any Holder holds solely shares of
Common Stock
acquired from third parties, such shares shall be Registrable Securities only
for so long as such Holder is an Affiliate of the Company, (b) any shares of
Common Stock issued or issuable, directly or indirectly, upon conversion or
redemption of shares of Series A Convertible Preferred Stock held by the Holders
(including, without limitation, in satisfaction of a Conversion Payment (as such
term is defined in the Series A Convertible Preferred Stock Certificate of
Designations) or any payment of shares upon a redemption under such
Certificate), (c) any shares of Common Stock issued or issuable, directly or
indirectly, upon conversion or redemption of shares of Series B Convertible
Preferred Stock held by the Holders (including, without limitation, in
satisfaction of any payment of shares upon a redemption under the Series B
Convertible Preferred Stock Certificate of Designations), (d) any shares of
Common Stock issued or issuable, directly or indirectly in exchange for or with
respect to the Common Stock referenced in clause (a) above by way of stock
dividend, stock split or combination of shares or in connection with a
reclassification, recapitalization, merger, consolidation or other
reorganization, and (e) any shares of Series A Convertible Preferred Stock held
by the Holders; PROVIDED, HOWEVER that the shares of Series A Convertible
Preferred Stock shall not be deemed to be Registrable Securities until the date
that is three years from the date hereof. As to any particular Registrable
Securities, such securities shall cease to be Registrable Securities when (A) a
registration statement with respect to the sale of such securities shall have
been declared effective under the Securities Act and such securities shall have
been disposed of in accordance with such registration statement, or (B) such
securities shall have been sold (other than in a privately negotiated sale)
pursuant to Rule 144 (or any successor provision) under the Securities Act and
in compliance with the requirements of paragraphs (f) and (g) of Rule 144
(notwithstanding the provisions of paragraph (k) of such Rule).
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Series A Convertible Preferred Stock" means the Series A Convertible
Preferred Stock of the Company and any equity securities issued or issuable in
exchange for or with respect to the Series A Convertible Preferred Stock by way
of a stock dividend, stock split or combination of shares or in connection with
a reclassification, recapitalization, merger, consolidation or other
reorganization.
"Series A Convertible Preferred Stock Certificate of Designations"
means the Certificate of Designations of the Series A Convertible Preferred
Stock, dated March 19, 2003.
"Series B Convertible Preferred Stock" means the Series B Convertible
Preferred Stock of the Company and any equity securities issued or issuable in
exchange for or with respect to the Series B Convertible Preferred Stock by way
of a stock dividend, stock split or combination of shares or in connection with
a reclassification, recapitalization, merger, consolidation or other
reorganization.
"Series B Convertible Preferred Stock Certificate of Designations"
means the Certificate of Designations of the Series B Convertible Preferred
Stock, dated March 19, 2003.
"Trading Day" means a day on which the principal national securities
exchange on which the Common Stock is quoted, listed or admitted to trading is
open for the transaction of business or, if the Common Stock is not quoted,
listed or admitted to trading on any national securities exchange (or the Nasdaq
Stock Market), any day other than a Saturday, Sunday, or a day on which
commercial banks in the City of New York are authorized or obligated by law or
executive order to close.
"Total Voting Power" means the total number of votes that may be cast
in the election of directors of the Company if all Voting Securities outstanding
or treated as outstanding pursuant to the final two sentences of this definition
were present and voted at a meeting held for such purpose. The percentage of the
Total Voting Power held by any Person is the percentage of the Total Voting
Power that is represented by the total number of votes that may be cast in the
election of directors of the Company by Voting Securities held by such Person.
In calculating such percentage, each share of Series A Convertible Preferred
Stock and each share of Series B Convertible Preferred Stock shall be
outstanding or shall be treated as outstanding for all purposes of this
Agreement without regard to the Person holding such share until such time as
such share of Series A Convertible Preferred Stock or Series B Convertible
Preferred Stock is redeemed or repurchased by the Company or converted into
Common Stock in accordance with the Series A Convertible Preferred Stock
Certificate of Designations or the Series B Convertible Preferred Stock
Certificate of Designations, as applicable. In calculating such percentage, the
Voting Securities held by any Person that are not outstanding but are subject to
issuance upon exercise or exchange of rights of conversion or any options,
warrants or other rights held by such Person shall be deemed to be outstanding
for the purpose of computing the percentage of the Total Voting Power
represented by Voting Securities held by such Person, but shall not be deemed to
be outstanding for the purpose of computing the percentage of the Total Voting
Power represented by Voting Securities Beneficially Owned by any other Person.
"Voting Securities" means Common Stock, the Series A Convertible
Preferred Stock, the Series B Convertible Preferred Stock and any other
securities of the Company or any Subsidiary (as such term is defined in the
Stockholders Agreement) entitled to vote generally in the election of directors
of the Company or any Subsidiary.
2. Registration Rights.
2.1 Demand Registrations.
(a) (i) Subject to Section 2.1(b) below, at any time after the
date that is eighteen months from the date hereof, the Holders shall have the
right to require the Company to file a registration statement under the
Securities Act covering such aggregate number of Registrable Securities which
represents 20% or greater of the Total Voting Power of the then outstanding
Registrable Securities, by delivering a written request
therefor to the Company specifying the number of Registrable Securities to be
included in such registration by such Holders and the intended method of
distribution thereof; PROVIDED, HOWEVER that no shares of Common Stock issued or
issuable, directly or indirectly, upon conversion of (x) shares of Series A
Convertible Preferred Stock or (y) shares of Series B Convertible Preferred
Stock may be included in such request prior to the date that is eighteen months
from the date hereof. All such requests by any Holder pursuant to this Section
2.1(a)(i) are referred to herein as "Demand Registration Requests," and the
registrations so requested are referred to herein as "Demand Registrations"
(with respect to any Demand Registration, the Holders making such demand for
registration being referred to as the "Initiating Holders"). As promptly as
practicable, but no later than ten days after receipt of a Demand Registration
Request, the Company shall give written notice (the "Demand Exercise Notice") of
such Demand Registration Request to all Holders of record of Registrable
Securities.
(ii) The Company, subject to Sections 2.3 and 2.6, shall
include in a Demand Registration (x) the Registrable Securities of the
Initiating Holders and (y) the Registrable Securities of any other Holder of
Registrable Securities which shall have made a written request to the Company
for inclusion in such registration (together with the Initiating Holders, the
"Participating Holders") (which request shall specify the maximum number of
Registrable Securities intended to be disposed of by such Participating Holders)
within 30 days after the receipt of the Demand Exercise Notice (or, 15 days if,
at the request of the Initiating Holders, the Company states in such written
notice or gives telephonic notice to all Holders, with written confirmation to
follow promptly thereafter, that such registration will be on a Form S-3).
(iii) The Company shall, as expeditiously as possible but
subject to Section 2.1(b), use its commercially reasonable efforts to (x) effect
such registration under the Securities Act of the Registrable Securities which
the Company has been so requested to register, for distribution in accordance
with such intended method of distribution, and (y) if requested by the Majority
Participating Holders, obtain acceleration of the effective date of the
registration statement relating to such registration.
(b) Notwithstanding anything to the contrary in Section 2.1(a), the
Demand Registration rights granted in Section 2.1(a) to the Holders are subject
to the following limitations: (i) the Company shall not be required to cause a
registration pursuant to Section 2.1(a)(i) to be declared effective within a
period of 180 days after the effective date of any other registration statement
of the Company filed pursuant to the Securities Act; (ii) if the Board of
Directors of the Company, in its good faith judgment, determines that any
registration of Registrable Securities should not be made or continued because
it would materially interfere with any material financing, acquisition,
corporate reorganization or merger or other transaction or event involving the
Company or any of its subsidiaries (a "Valid Business Reason"), the Company may
postpone filing a registration statement relating to a Demand Registration
Request until such Valid Business Reason no longer exists, but in no event for
more than three months (such period of postponement or withdrawal under this
clause (ii), the "Postponement Period");
and the Company shall give written notice of its determination to postpone or
withdraw a registration statement and of the fact that the Valid Business Reason
for such postponement or withdrawal no longer exists, in each case, promptly
after the occurrence thereof; PROVIDED, HOWEVER, the Company shall not be
permitted to postpone or withdraw a registration statement after the expiration
of any Postponement Period until twelve months after the expiration of such
Postponement Period; (iii) the Company shall not be obligated to effect more
than three Demand Registrations under Section 2.1(a) for the Holders, and (iv)
the Company shall not be required to effect a Demand Registration unless the
Registrable Securities to be included in such registration have an aggregate
anticipated offering price of at least $25,000,000 (based on the then-current
market price of the Registrable Securities).
If the Company shall give any notice of postponement or withdrawal of
any registration statement pursuant to clause (ii) above, the Company shall not,
during the period of postponement or withdrawal, register any equity security of
the Company, other than pursuant to a registration statement on Form S-4 or S-8
(or an equivalent registration form then in effect). Each Holder of Registrable
Securities agrees that, upon receipt of any notice from the Company that the
Company has determined to withdraw any registration statement pursuant to clause
(ii) above, such Holder will discontinue its disposition of Registrable
Securities pursuant to such registration statement and, if so directed by the
Company, will deliver to the Company (at the Company's expense) all copies,
other than permanent file copies, then in such Holder's possession of the
prospectus covering such Registrable Securities that was in effect at the time
of receipt of such notice. If the Company shall have withdrawn or prematurely
terminated a registration statement filed under Section 2.1(a)(i) (whether
pursuant to clause (ii) above or as a result of any stop order, injunction or
other order or requirement of the SEC or any other governmental agency or
court), the Company shall not be considered to have effected an effective
registration for the purposes of this Agreement until the Company shall have
filed a new registration statement covering the Registrable Securities covered
by the withdrawn registration statement and such registration statement shall
have been declared effective and shall not have been withdrawn. If the Company
shall give any notice of withdrawal or postponement of a registration statement,
the Company shall, at such time as the Valid Business Reason that caused such
withdrawal or postponement no longer exists (but in no event later than three
months after the date of the postponement or withdrawal), use its commercially
reasonable best efforts to effect the registration under the Securities Act of
the Registrable Securities covered by the withdrawn or postponed registration
statement in accordance with this Section 2.1 (unless the Initiating Holders
shall have withdrawn such request, in which case the Company shall not be
considered to have effected an effective registration for the purposes of this
Agreement).
(c) The Company, subject to Sections 2.3 and 2.6, may elect to
include in any registration statement and offering made pursuant to Section
2.1(a)(i), (i) authorized but unissued shares of Common Stock or shares of
Common Stock held by the Company as treasury shares and (ii) any other shares of
Common Stock which are requested to be included in such registration pursuant to
the exercise of piggyback rights granted by the Company which are not
inconsistent with the rights granted in, or otherwise conflict with the terms
of, this Agreement ("Additional Piggyback Rights");
provided, however, that such inclusion shall be permitted only to the extent
that it is pursuant to and subject to the terms of the underwriting agreement or
arrangements, if any, entered into by the Participating Holders.
(d) In connection with any Demand Registration, the Company shall
have the right to designate the lead managing underwriter in connection with
such registration and each other managing underwriter for such registration,
provided that in each case, each such underwriter is reasonably satisfactory to
the Majority Participating Holders.
2.2 Piggyback Registrations.
(a) If, at any time, the Company proposes or is required to register
any of its equity securities under the Securities Act (other than pursuant to
(i) registrations on such form or similar form(s) solely for registration of
securities in connection with an employee benefit plan or dividend reinvestment
plan or a merger or consolidation or (ii) a Demand Registration under Section
2.1) on a registration statement on Form S-1, Form S-2 or Form S-3 (or an
equivalent general registration form then in effect), whether or not for its own
account, the Company shall give prompt written notice of its intention to do so
to each of the Holders of record of Registrable Securities. Upon the written
request of any such Holder, made within 15 days following the receipt of any
such written notice (which request shall specify the maximum number of
Registrable Securities intended to be disposed of by such Holder and the
intended method of distribution thereof), the Company shall, subject to Sections
2.2(b), 2.3 and 2.6 hereof, use its commercially reasonable efforts to cause all
such Registrable Securities, the holders of which have so requested the
registration thereof, to be included in the registration statement with the
securities which the Company at the time proposes to register to permit the sale
or other disposition by the Holders (in accordance with the intended method of
distribution thereof) of the Registrable Securities to be so registered. No
registration of Registrable Securities effected under this Section 2.2(a) shall
relieve the Company of its obligations to effect Demand Registrations under
Section 2.1 hereof.
(b) If, at any time after giving written notice of its intention to
register any equity securities and prior to the effective date of the
registration statement filed in connection with such registration, the Company
shall determine for any reason not to register or to delay registration of such
equity securities, the Company may, at its election, give written notice of such
determination to all Holders of record of Registrable Securities and (i) in the
case of a determination not to register, shall be relieved of its obligation to
register any Registrable Securities in connection with such abandoned
registration, without prejudice, however, to the rights of Holders under Section
2.1, and (ii) in the case of a determination to delay such registration of its
equity securities, shall be permitted to delay the registration of such
Registrable Securities for the same period as the delay in registering such
other equity securities.
(c) Any Holder shall have the right to withdraw its request for
inclusion of its Registrable Securities in any registration statement pursuant
to this Section 2.2 by giving written notice to the Company of its request to
withdraw; provided,
however, that (i) such request must be made in writing prior to the earlier of
the execution of the underwriting agreement or the execution of the custody
agreement with respect to such registration and (ii) such withdrawal shall be
irrevocable and, after making such withdrawal, a Holder shall no longer have any
right to include Registrable Securities in the registration as to which such
withdrawal was made.
2.3 Allocation of Securities Included in Registration Statement.
(a) If any requested registration made pursuant to Section 2.1
involves an underwritten offering and the lead managing underwriter of such
offering (the "Manager") shall advise the Company that, in its view, the number
of securities requested to be included in such registration by the Holders of
Registrable Securities or any other persons (including those shares of Common
Stock requested by the Company to be included in such registration) exceeds the
largest number (the "Section 2.3(a) Sale Number") that can be sold in an orderly
manner in such offering within a price range acceptable to the Majority
Participating Holders, the Company shall use its commercially reasonable efforts
to include in such registration:
(i) first, all Registrable Securities and Goldman Registrable
Securities requested to be included in such registration by the holders thereof;
provided, however, that, if the number of such Registrable Securities and
Goldman Registrable Securities exceeds the Section 2.3(a) Sale Number, the
number of such Registrable Securities and Goldman Registrable Securities (not to
exceed the Section 2.3(a) Sale Number) to be included in such registration shall
be allocated on a pro rata basis among all holders requesting that Registrable
Securities and Goldman Registrable Securities be included in such registration,
based on the number of Registrable Securities and Goldman Registrable Securities
then owned by each such holder requesting inclusion in relation to the number of
Registrable Securities and Goldman Registrable Securities owned by all holders
requesting inclusion; and
(ii) second, to the extent that the number of securities to be
included pursuant to clause (i) of this Section 2.3(a) is less than the Section
2.3(a) Sale Number, the remaining shares to be included in such registration
shall be allocated on a pro rata basis among all holders requesting that
securities be included in such registration pursuant to the exercise of
Additional Piggyback Rights ("Piggyback Shares"), based on the aggregate number
of Piggyback Shares then owned by each holder requesting inclusion in relation
to the aggregate number of Piggyback Shares owned by all holders requesting
inclusion, up to the Section 2.3(a) Sale Number; and
(iii) third, to the extent that the number of securities to be
included pursuant to clauses (i) and (ii) of this Section 2.3(a) is less than
the Section 2.3(a) Sale Number, any securities that the Company proposes to
register, up to the Section 2.3(a) Sale Number.
If, as a result of the proration provisions of this Section 2.3(a),
any Holder shall not be entitled to include all Registrable Securities in a
registration that such Holder has requested be included, such Holder may elect
to withdraw his request to include Registrable Securities in such registration
or may reduce the number requested to be included; provided, however, that (x)
such request must be made in writing prior to the earlier of the execution of
the underwriting agreement or the execution of the custody agreement with
respect to such registration and (y) such withdrawal shall be irrevocable and,
after making such withdrawal, such Holder shall no longer have any right to
include Registrable Securities in the registration as to which such withdrawal
was made.
(b) If any registration pursuant to Section 2.2 involves an
underwritten offering that was initially proposed by the Company after the date
hereof as a primary registration of its securities and the Manager shall advise
the Company that, in its view, the number of securities requested to be included
in such registration exceeds the number (the "Section 2.3(b) Sale Number") that
can be sold in an orderly manner in such registration within a price range
acceptable to the Company, the Company shall include in such registration:
(i) first, all Common Stock that the Company proposes to
register for its own account;
(ii) second, to the extent that the number of securities to be
included pursuant to clause (i) of this Section 2.3(b) is less than the Section
2.3(b) Sale Number, the remaining shares to be included in such registration
shall be allocated on a pro rata basis among all holders requesting that
Registrable Securities or Goldman Registrable Securities be included in such
registration, based on the aggregate number of Registrable Securities and
Goldman Registrable Securities then owned by each holder requesting inclusion in
relation to the aggregate number of Registrable Securities and Goldman
Registrable Securities owned by all holders requesting inclusion, up to the
Section 2.3(b) Sale Number;
(iii) third, to the extent that the number of securities to be
included pursuant to clauses (i) and (ii) of this Section 2.3(b) is less than
the Section 2.3(b) Sale Number, the remaining shares to be included in such
registration shall be allocated on a pro rata basis among all holders requesting
that Piggyback Shares be included in such registration pursuant to the exercise
of Additional Piggyback Rights, based on the aggregate number of Piggyback
Shares then owned by each holder requesting inclusion in relation to the
aggregate number of Piggyback Shares owned by all holders requesting inclusion,
up to the Section 2.3(b) Sale Number.
If, as a result of the proration provisions of this Section 2.3(b),
any Holder shall not be entitled to include all Registrable Securities in a
registration that such Holder has requested be included, such Holder may elect
to withdraw his request to include Registrable Securities in such registration
or may reduce the number requested to be included; provided, however, that (x)
such request must be made in writing prior to the earlier of the execution of
the underwriting
agreement or the execution of the custody agreement with respect to such
registration and (y) such withdrawal shall be irrevocable and, after making such
withdrawal, such Holder shall no longer have any right to include Registrable
Securities in the registration as to which such withdrawal was made.
(c) If any registration pursuant to Section 2.2 involves an
underwritten offering that was initially proposed by holders of securities of
the Company that have the right to require such registration pursuant to an
agreement entered into by the Company in accordance with Section 4.7 hereof
("Additional Demand Rights") and the Manager shall advise the Company that, in
its view, the number of securities requested to be included in such registration
exceeds the number (the "Section 2.3(c) Sale Number") that can be sold in an
orderly manner in such registration within a price range acceptable to the
Company, the Company shall include in such registration:
(i) first, all securities requested to be included in such
registration by the holders of Additional Demand Rights ("Additional Registrable
Securities"), the Holders and the Goldman Holders; provided, however, that, if
the number of such Additional Registrable Securities, Registrable Securities and
Goldman Registrable Securities exceeds the Section 2.3(c) Sale Number, the
number of such Additional Registrable Securities, Registrable Securities and
Goldman Registrable Securities (not to exceed the Section 2.3(c) Sale Number) to
be included in such registration shall be allocated on a pro rata basis among
all holders of Additional Registrable Securities, Registrable Securities and
Goldman Registrable Securities requesting that Additional Registrable
Securities, Registrable Securities or Goldman Registrable Securities, as the
case may be, be included in such registration, based on the number of Additional
Registrable Securities, Registrable Securities or Goldman Registrable
Securities, as the case may be, then owned by each such holders requesting
inclusion in relation to the number of Additional Registrable Securities,
Registrable Securities or Goldman Registrable Securities, as the case may be,
owned by all of such holders requesting inclusion;
(ii) second, to the extent that the number of securities to be
included pursuant to clause (i) of this Section 2.3(c) is less than the Section
2.3(c) Sale Number, any Common Stock that the Company proposes to register for
its own account, up to the Section 2.3(c) Sale Number; and
(iii) third, to the extent that the number of securities to be
included pursuant to clauses (i), and (ii) of this Section 2.3(c) is less than
the Section 2.3(c) Sale Number, the remaining shares to be included in such
registration shall be allocated on a pro rata basis among all holders requesting
that Piggyback Shares be included in such registration pursuant to the exercise
of Additional Piggyback Rights, based on the aggregate number of Piggyback
Shares then owned by each holder requesting inclusion in relation to the
aggregate number of Piggyback Shares owned by all holders requesting inclusion,
up to the Section 2.3(c) Sale Number.
If, as a result of the proration provisions of this Section 2.3(c),
any Holder shall not be entitled to include all Registrable Securities in a
registration that such Holder has requested be included, such Holder may elect
to withdraw his request to include Registrable Securities in such registration
or may reduce the number requested to be included; provided, however, that (x)
such request must be made in writing prior to the earlier of the execution of
the underwriting agreement or the execution of the custody agreement with
respect to such registration and (y) such withdrawal shall be irrevocable and,
after making such withdrawal, such Holder shall no longer have any right to
include Registrable Securities in the registration as to which such withdrawal
was made.
(d) Notwithstanding Section 2.3(c), if at any time any registration
pursuant to Section 2.2 involves an underwritten offering that was initially
proposed by the Goldman Holders and the Manager shall advise the Company that,
in its view, the number of securities requested to be included in such
registration exceeds the number (the "Section 2.3(d) Sale Number") that can be
sold in an orderly manner in such registration within a price range acceptable
to the Company, the Company shall include in such registration:
(i) first, all Registrable Securities and Goldman Registrable
Securities requested to be included in such registration by the holders thereof;
provided, however, that, if the number of such Registrable Securities and
Goldman Registrable Securities exceeds the Section 2.3(d) Sale Number, the
number of such Registrable Securities and Goldman Registrable Securities (not to
exceed the Section 2.3(d) Sale Number) to be included in such registration shall
be allocated on a pro rata basis among all holders requesting that Registrable
Securities and Goldman Registrable Securities be included in such registration,
based on the number of Registrable Securities and Goldman Registrable Securities
then owned by each such holder requesting inclusion in relation to the number of
Registrable Securities and Goldman Registrable Securities owned by all holders
requesting inclusion;
(ii) second, to the extent that the number of securities to be
included pursuant to clause (i) of this Section 2.3(d) is less than the Section
2.3(d) Sale Number, the remaining shares to be included in such registration
shall be allocated on a pro rata basis among all holders requesting that
securities be included in such registration pursuant to the exercise of
Piggyback Shares, based on the aggregate number of Piggyback Shares then owned
by each holder requesting inclusion in relation to the aggregate number of
Piggyback Shares owned by all holders requesting inclusion, up to the Section
2.3(d) Sale Number; and
(iii) third, to the extent that the number of securities to be
included pursuant to clauses (i) and (ii) of this Section 2.3(d) is less than
the Section 2.3(d) Sale Number, any securities that the Company proposes to
register, up to the Section 2.3(d) Sale Number.
If, as a result of the proration provisions of this Section 2.3(d), any Holder
shall not be
entitled to include all Registrable Securities in a registration that such
Holder has requested be included, such Holder may elect to withdraw his request
to include Registrable Securities in such registration or may reduce the number
requested to be included; provided, however, that (x) such request must be made
in writing prior to the earlier of the execution of the underwriting agreement
or the execution of the custody agreement with respect to such registration and
(y) such withdrawal shall be irrevocable and, after making such withdrawal, such
Holder shall no longer have any right to include Registrable Securities in the
registration as to which such withdrawal was made.
2.4 Registration Procedures. If and whenever the Company is required by
the provisions of this Agreement to use its commercially reasonable efforts to
effect or cause the registration of any Registrable Securities under the
Securities Act as provided in this Agreement, the Company shall, as
expeditiously as possible:
(a) prepare and file with the SEC a registration statement on an
appropriate registration form of the SEC for the disposition of such Registrable
Securities in accordance with the intended method of disposition thereof, which
form shall be selected by the Company and shall comply as to form in all
material respects with the requirements of the applicable form and include all
financial statements required by the SEC to be filed therewith, and the Company
shall use its commercially reasonable efforts to cause such registration
statement to become and remain effective (provided, however, that before filing
a registration statement or prospectus or any amendments or supplements thereto,
or comparable statements under securities or blue sky laws of any jurisdiction,
the Company will furnish to one counsel for the Holders participating in the
planned offering (selected by the Majority Participating Holders, in the case of
a registration pursuant to Section 2.1, and selected by the lead managing
underwriter, in the case of a registration pursuant to Section 2.2) and the lead
managing underwriter, if any, copies of all such documents proposed to be filed
(including all exhibits thereto), which documents will be subject to the
reasonable review and reasonable comment of such counsel, and the Company shall
not file any registration statement or amendment thereto or any prospectus or
supplement thereto to which the holders of a majority of the Registrable
Securities covered by such registration statement or the underwriters, if any,
shall reasonably object);
(b) prepare and file with the SEC such amendments and supplements to
such registration statement and the prospectus used in connection therewith as
may be necessary to keep such registration statement effective for such period
as any seller of Registrable Securities pursuant to such registration statement
shall request and to comply with the provisions of the Securities Act with
respect to the sale or other disposition of all Registrable Securities covered
by such registration statement in accordance with the intended methods of
disposition by the seller or sellers thereof set forth in such registration
statement;
(c) furnish, without charge, to each seller of such Registrable
Securities and each underwriter, if any, of the securities covered by such
registration statement such number of copies of such registration statement,
each amendment and supplement thereto (in each case including all exhibits), and
the prospectus included in
such registration statement (including each preliminary prospectus) in
conformity with the requirements of the Securities Act, and other documents, as
such seller and underwriter may reasonably request in order to facilitate the
public sale or other disposition of the Registrable Securities owned by such
seller (the Company hereby consenting to the use in accordance with all
applicable law of each such registration statement (or amendment or
post-effective amendment thereto) and each such prospectus (or preliminary
prospectus or supplement thereto) by each such seller of Registrable Securities
and the underwriters, if any, in connection with the offering and sale of the
Registrable Securities covered by such registration statement or prospectus);
(d) use its commercially reasonable efforts to register or qualify
the Registrable Securities covered by such registration statement under such
other securities or "blue sky" laws of such jurisdictions as any sellers of
Registrable Securities or any managing underwriter, if any, shall reasonably
request in writing, and do any and all other acts and things which may be
reasonably necessary or advisable to enable such sellers or underwriter, if any,
to consummate the disposition of the Registrable Securities in such
jurisdictions, except that in no event shall the Company be required to qualify
to do business as a foreign corporation in any jurisdiction where it would not,
but for the requirements of this paragraph (d), be required to be so qualified,
to subject itself to taxation in any such jurisdiction or to consent to general
service of process in any such jurisdiction;
(e) promptly notify each Holder selling Registrable Securities
covered by such registration statement and each managing underwriter, if any:
(i) when the registration statement, any pre-effective amendment, the prospectus
or any prospectus supplement related thereto or post-effective amendment to the
registration statement has been filed and, with respect to the registration
statement or any post-effective amendment, when the same has become effective;
(ii) of any request by the SEC or state securities authority for amendments or
supplements to the registration statement or the prospectus related thereto or
for additional information; (iii) 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; (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification of any
Registrable Securities for sale under the securities or blue sky laws of any
jurisdiction or the initiation of any proceeding for such purpose; (v) of the
existence of any fact of which the Company becomes aware which results in the
registration statement, the prospectus related thereto or any document
incorporated therein by reference containing an untrue statement of a material
fact or omitting to state a material fact required to be stated therein or
necessary to make any statement therein not misleading; and (vi) if at any time
the representations and warranties contemplated by any underwriting agreement,
securities sale agreement, or other similar agreement, relating to the offering
shall cease to be true and correct in all material respects; and, if the
notification relates to an event described in clause (v), the Company shall
promptly prepare and furnish to each such seller and each underwriter, if any, a
reasonable number of copies of a prospectus supplemented or amended so that, as
thereafter delivered to the purchasers of such Registrable Securities, such
prospectus shall not include an untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein in the light of the circumstances under which they were made
not misleading;
(f) comply with all applicable rules and regulations of the SEC, and
make generally available to its security holders, as soon as reasonably
practicable after the effective date of the registration statement (and in any
event within 16 months thereafter), an earnings statement (which need not be
audited) covering the period of at least twelve consecutive months beginning
with the first day of the Company's first calendar quarter after the effective
date of the registration statement, which earnings statement shall satisfy the
provisions of Section 11(a) of the Securities Act and Rule 158 thereunder;
(g) (i) cause all such Registrable Securities covered by such
registration statement to be listed on the New York Stock Exchange or the
principal securities exchange on which similar securities issued by the Company
are then listed (if any), if the listing of such Registrable Securities is then
permitted under the rules of such exchange, or (ii) if no similar securities are
then so listed, to either cause all such Registrable Securities to be listed on
a national securities exchange or to secure designation of all such Registrable
Securities as a Nasdaq National Market "national market system security" within
the meaning of Rule 11Aa2-1 of the Exchange Act or, failing that, secure Nasdaq
National Market authorization for such shares and, without limiting the
generality of the foregoing, take all actions that may be required by the
Company as the issuer of such Registrable Securities in order to facilitate the
managing underwriter's arranging for the registration of at least two market
makers as such with respect to such shares with the National Association of
Securities Dealers, Inc. (the "NASD");
(h) provide and cause to be maintained a transfer agent and registrar
for all such Registrable Securities covered by such registration statement not
later than the effective date of such registration statement;
(i) enter into such customary agreements (including, if applicable,
an underwriting agreement) and take such other actions as the holders of a
majority of the Registrable Securities participating in such offering shall
reasonably request in order to expedite or facilitate the disposition of such
Registrable Securities (it being understood that the Holders of the Registrable
Securities which are to be distributed by any underwriters shall be parties to
any such underwriting agreement and may, at their option, require that the
Company make to and for the benefit of such Holders the representations,
warranties and covenants of the Company which are being made to and for the
benefit of such underwriters);
(j) use its commercially reasonable efforts to obtain an opinion from
the Company's counsel and a "cold comfort" letter from the Company's independent
public accountants in customary form and covering such matters as are
customarily covered by such opinions and "cold comfort" letters delivered to
underwriters in underwritten public offerings, which opinion and letter shall be
reasonably satisfactory to the underwriter, if any, and furnish to each Holder
participating in the offering and to
each underwriter, if any, a copy of such opinion and letter addressed to such
Holder or underwriter;
(k) deliver promptly to each Holder participating in the offering and
each underwriter, if any, copies of all correspondence between the SEC and the
Company, its counsel or auditors and all memoranda relating to discussions with
the SEC or its staff with respect to the registration statement, other than
those portions of any such memoranda which contain information subject to
attorney-client privilege with respect to the Company, and, upon receipt of such
confidentiality agreements as the Company may reasonably request, make
reasonably available for inspection by any seller of such Registrable Securities
covered by such registration statement, by any underwriter, if any,
participating in any disposition to be effected pursuant to such registration
statement and by any attorney, accountant or other agent retained by any such
seller or any such underwriter, all pertinent financial and other records,
pertinent corporate documents and properties of the Company, and cause all of
the Company's officers, directors and employees to supply all information
reasonably requested by any such seller, underwriter, attorney, accountant or
agent in connection with such registration statement;
(l) use its commercially reasonable efforts to obtain the withdrawal
of any order suspending the effectiveness of the registration statement;
(m) provide a CUSIP number for all Registrable Securities, not later
than the effective date of the registration statement;
(n) make reasonably available its employees and personnel for
participation in "road shows" an other marketing efforts and otherwise provide
reasonable assistance to the underwriters (taking into account the needs of the
Company's businesses and the requirements of the marketing process) in the
marketing of Registrable Securities in any underwritten offering;
(o) promptly prior to the filing of any document which is to be
incorporated by reference into the registration statement or the prospectus
(after the initial filing of such registration statement) provide copies of such
document to counsel for the selling holders of Registrable Securities and to
each managing underwriter, if any, and make the Company's representatives
reasonably available for discussion of such document and make such changes in
such document concerning the selling holders prior to the filing thereof as
counsel for such selling holders or underwriters may reasonably request;
(p) furnish to the Holder participating in the offering and the
managing underwriter, without charge, at least one signed copy, and to each
other Holder participating in the offering, without charge, at least one
photocopy of a signed copy, of the registration statement and any post-effective
amendments thereto, including financial statements and schedules, all documents
incorporated therein by reference and all exhibits (including those incorporated
by reference);
(q) cooperate with the sellers 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 issued in
such denominations and registered in such names in accordance with the
underwriting agreement prior to any sale of Registrable Securities to the
underwriters or, if not an underwritten offering, in accordance with the
instructions of the sellers of Registrable Securities at least three business
days prior to any sale of Registrable Securities and instruct any transfer agent
and registrar of Registrable Securities to release any stop transfer orders in
respect thereof;
(r) take all such other commercially reasonable actions as are
necessary or advisable in order to expedite or facilitate the disposition of
such Registrable Securities; and
(s) take no direct or indirect action prohibited by Regulation M
under the Exchange Act; provided, however, that to the extent that any
prohibition is applicable to the Company, the Company will take such action as
is necessary to make any such prohibition inapplicable.
The Company may require as a condition precedent to the Company's
obligations under this Section 2.4 that each seller of Registrable Securities as
to which any registration is being effected furnish the Company such information
in writing regarding such seller and the distribution of such Registrable
Securities as the Company may from time to time reasonably request provided that
such information is necessary for the Company to consummate such registration
and shall be used only in connection with such registration.
Each seller of Registrable Securities agrees that upon receipt of any
notice from the Company of the happening of any event of the kind described in
clause (v) of paragraph (e) of this Section 2.4, such seller will discontinue
such seller's disposition of Registrable Securities pursuant to the registration
statement covering such Registrable Securities until such seller's receipt of
the copies of the supplemented or amended prospectus contemplated by paragraph
(e) of this Section 2.4 and, if so directed by the Company, will deliver to the
Company (at the Company's expense) all copies, other than permanent file copies,
then in such seller's possession of the prospectus covering such Registrable
Securities that was in effect at the time of receipt of such notice. In the
event the Company shall give any such notice, the applicable period mentioned in
paragraph (b) of this Section 2.4 shall be extended by the number of days during
such period from and including the date of the giving of such notice to and
including the date when each seller of any Registrable Securities covered by
such registration statement shall have received the copies of the supplemented
or amended prospectus contemplated by paragraph (e) of this Section 2.4.
If any such registration statement or comparable statement under "blue
sky" laws refers to any Holder by name or otherwise as the Holder of any
securities of the Company, then such Holder shall have the right to require (i)
the insertion therein of language, in form and substance reasonably satisfactory
to such Holder and the
Company, to the effect that the holding by such Holder of such securities is not
to be construed as a recommendation by such Holder of the investment quality of
the Company's securities covered thereby and that such holding does not imply
that such Holder will assist in meeting any future financial requirements of the
Company, or (ii) in the event that such reference to such Holder by name or
otherwise is not in the judgment of the Company, as advised by counsel, required
by the Securities Act or any similar federal statute or any state "blue sky" or
securities law then in force, the deletion of the reference to such Holder.
2.5 Registration Expenses.
(a) The Company shall pay all Expenses (x) with respect to any Demand
Registration whether or not it becomes effective or remains effective for the
period contemplated by Section 2.4(b) and (y) with respect to any registration
effected under Section 2.2.
(b) Notwithstanding the foregoing, (x) the provisions of this Section
2.5 shall be deemed amended to the extent necessary to cause these expense
provisions to comply with "blue sky" laws of each state in which the offering is
made and (y) in connection with any registration hereunder, each Holder of
Registrable Securities being registered shall pay all underwriting discounts and
commissions and any transfer taxes, if any, attributable to the sale of such
Registrable Securities, pro rata with respect to payments of discounts and
commissions in accordance with the number of shares sold in the offering by such
Holder, and (z) the Company shall, in the case of all registrations under this
Article 2, be responsible for all its internal expenses (including, without
limitation, all salaries and expenses of its officers and employees performing
legal or accounting duties).
2.6 Certain Limitations on Registration Rights. In the case of any
registration under Section 2.1 pursuant to an underwritten offering, or, in the
case of a registration under Section 2.2, if the Company has determined to enter
into an underwriting agreement in connection therewith, all securities to be
included in such registration shall be subject to an underwriting agreement and
no Person may participate in such registration unless such Person agrees to sell
such Person's securities on the basis provided therein and, subject to Section
3.1 hereof, completes and executes all reasonable questionnaires, and other
documents (including custody agreements and powers of attorney) which must be
executed in connection therewith, and provides such other information to the
Company or the underwriter as may be necessary to register such Person's
securities.
2.7 Limitations on Sale or Distribution of Other Securities. (a) Each
seller of Registrable Securities agrees that, (i) to the extent requested in
writing by a managing underwriter, if any, of any registration effected pursuant
to Section 2.1, not to sell, transfer or otherwise dispose of, including any
sale pursuant to Rule 144 under the Securities Act, any Common Stock, or any
other equity security of the Company or any security convertible into or
exchangeable or exercisable for any equity security of the Company (other than
as part of such underwritten public offering) during the time period
reasonably requested by the managing underwriter, not to exceed 90 days (and the
Company hereby also so agrees (except that the Company may effect any sale or
distribution of any such securities pursuant to a registration on Form S-4 (if
reasonably acceptable to such managing underwriter) or Form S-8, or any
successor or similar form which is then in effect or upon the conversion,
exchange or exercise of any then outstanding Common Stock Equivalent) to use its
commercially reasonable efforts to cause each holder of any equity security or
any security convertible into or exchangeable or exercisable for any equity
security of the Company purchased from the Company at any time other than in a
public offering so to agree), and (ii) to the extent requested in writing by a
managing underwriter of any underwritten public offering effected by the Company
for its own account it will not sell any Common Stock (other than as part of
such underwritten public offering) during the time period reasonably requested
by the managing underwriter, which period shall not exceed 90 days.
(b) The Company hereby agrees that, if it shall previously have
received a request for registration pursuant to Section 2.1 or 2.2, and if such
previous registration shall not have been withdrawn or abandoned, the Company
shall not sell, transfer, or otherwise dispose of, any Common Stock, or any
other equity security of the Company or any security convertible into or
exchangeable or exercisable for any equity security of the Company (other than
as part of such underwritten public offering, a registration on Form S-4 or Form
S-8 or any successor or similar form which is then in effect or upon the
conversion, exchange or exercise of any then outstanding Common Stock
Equivalent), until a period of 90 days shall have elapsed from the effective
date of such previous registration; and the Company shall so provide in any
registration rights agreements hereafter entered into with respect to any of its
securities.
2.8 No Required Sale. Nothing in this Agreement shall be deemed to create
an independent obligation on the part of any Holder to sell any Registrable
Securities pursuant to any effective registration statement.
2.9 Indemnification. (a) In the event of any registration of any
securities of the Company under the Securities Act pursuant to this Article 2,
the Company will, and hereby agrees to, indemnify and hold harmless, to the
fullest extent permitted by law, each Holder of Registrable Securities, its
directors, officers, fiduciaries, employees, stockholders, members or general
and limited partners (and the directors, officers, employees and stockholders
thereof), each other Person who participates as an underwriter or a Qualified
Independent Underwriter, if any, in the offering or sale of such securities,
each officer, director, employee, stockholder, fiduciary, managing director,
agent, affiliates, consultants, representatives, successors, assigns or partner
of such underwriter or Qualified Independent Underwriter, and each other Person,
if any, who controls such Holder or any such underwriter within the meaning of
the Securities Act, from and against any and all losses, claims, damages or
liabilities, joint or several, actions or proceedings (whether commenced or
threatened) and expenses (including reasonable fees of counsel and any amounts
paid in any settlement effected with the Company's consent, which consent shall
not be unreasonably withheld or delayed) to which each such indemnified party
may become subject under the Securities Act or otherwise in respect thereof
(collectively, "Claims"), insofar as such Claims arise out of or are based
upon (i) any untrue statement or alleged untrue statement of a material fact
contained in any registration statement under which such securities were
registered under the Securities Act or the omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, (ii) any untrue statement or alleged untrue
statement of a material fact contained in any preliminary, final or summary
prospectus or any amendment or supplement thereto, together with the documents
incorporated by reference therein, or the omission or alleged omission to state
therein a material fact required to be stated therein or necessary in order to
make the statements therein, in the light of the circumstances under which they
were made, not misleading, or (iii) any violation by the Company of any federal,
state or common law rule or regulation applicable to the Company and relating to
action required of or inaction by the Company in connection with any such
registration, and the Company will reimburse any such indemnified party for any
legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such Claim as such expenses are
incurred; provided, however, that the Company shall not be liable to any such
indemnified party in any such case to the extent such Claim arises out of or is
based upon any untrue statement or alleged untrue statement of a material fact
or omission or alleged omission of a material fact made in such registration
statement or amendment thereof or supplement thereto or in any such prospectus
or any preliminary, final or summary prospectus in reliance upon and in
conformity with written information furnished to the Company by or on behalf of
such indemnified party specifically for use therein. Such indemnity and
reimbursement of expenses shall remain in full force and effect regardless of
any investigation made by as on behalf of such indemnified party and shall
survive the transfer of such securities by such Holder.
(b) Each Holder of Registrable Securities that are included in the
securities as to which any registration under Section 2.1 or 2.2 is being
effected shall, severally and not jointly, indemnify and hold harmless (in the
same manner and to the same extent as set forth in paragraph (a) of this Section
2.9) to the extent permitted by law the Company, its officers and directors,
each Person controlling the Company within the meaning of the Securities Act and
all other prospective sellers and their respective directors, officers,
fiduciaries, managing directors, employees, agents, affiliates, consultants,
representatives, successors, assigns, general and limited partners, stockholders
and respective controlling Persons with respect to any untrue statement or
alleged untrue statement of any material fact in, or omission or alleged
omission of any material fact from, such registration statement, any
preliminary, final or summary prospectus contained therein, or any amendment or
supplement thereto, if such statement or alleged statement or omission or
alleged omission was made in reliance upon and in conformity with written
information furnished to the Company or its representatives by or on behalf of
such Holder specifically for use therein and reimburse such indemnified party
for any legal or other expenses reasonably incurred in connection with
investigating or defending any such Claim as such expenses are incurred;
provided, however, that the aggregate amount which any such Holder shall be
required to pay pursuant to this Section 2.9(b) and Sections 2.9(c), (e) and (f)
shall in no case be greater than the amount of the net proceeds received by such
Holder upon the sale of the Registrable Securities pursuant to the registration
statement giving rise to such claim. Such indemnity and reimbursement
of expenses shall remain in full force and effect regardless of any
investigation made by or on behalf of such indemnified party and shall survive
the transfer of such securities by such Holder.
(c) Indemnification similar to that specified in the preceding
paragraphs (a) and (b) of this Section 2.9 (with appropriate modifications)
shall be given by the Company and each seller of Registrable Securities with
respect to any required registration or other qualification of securities under
any state securities and "blue sky" laws.
(d) Any Person entitled to indemnification under this Agreement shall
notify promptly the indemnifying party in writing of the commencement of any
action or proceeding with respect to which a claim for indemnification may be
made pursuant to this Section 2.9, but the failure of any such Person to provide
such notice shall not relieve the indemnifying party of its obligations under
the preceding paragraphs of this Section 2.9, except to the extent the
indemnifying party is materially prejudiced thereby and shall not relieve the
indemnifying party from any liability which it may have to any such Person
otherwise than under this Article 2. In case any action or proceeding is brought
against an indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, unless in the reasonable opinion of outside counsel to the
indemnified party a conflict of interest between such indemnified and
indemnifying parties may exist in respect of such claim, to assume the defense
thereof jointly with any other indemnifying party similarly notified, to the
extent that it chooses, with counsel reasonably satisfactory to such indemnified
party, and after notice from the indemnifying party to such indemnified party
that it so chooses, the indemnifying party shall not be liable to such
indemnified party for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense thereof other than reasonable
costs of investigation; provided, however, that (i) if the indemnifying party
fails to take reasonable steps necessary to defend diligently the action or
proceeding within 20 days after receiving notice from such indemnified party; or
(ii) if such indemnified party who is a defendant in any action or proceeding
which is also brought against the indemnifying party reasonably shall have
concluded that there may be one or more legal defenses available to such
indemnified party which are not available to the indemnifying party; or (iii) if
representation of both parties by the same counsel is otherwise inappropriate
under applicable standards of professional conduct, then, in any such case, the
indemnified party shall have the right to assume or continue its own defense as
set forth above (but with no more than one firm of counsel for all indemnified
parties in each jurisdiction, except to the extent any indemnified party or
parties reasonably shall have concluded that there may be legal defenses
available to such party or parties which are not available to the other
indemnified parties or to the extent representation of all indemnified parties
by the same counsel is otherwise inappropriate under applicable standards of
professional conduct) and the indemnifying party shall be liable for any
expenses therefor. No indemnifying party shall, without the written consent of
the indemnified party, which consent shall not be unreasonably withheld, effect
the settlement or compromise of, or consent to the entry of any judgment with
respect to, any pending or threatened action or claim in respect of which
indemnification or contribution may be sought hereunder
(whether or not the indemnified party is an actual or potential party to such
action or claim) unless such settlement, compromise or judgment (A) includes an
unconditional release of the indemnified party from all liability arising out of
such action or claim and (B) does not include a statement as to or an admission
of fault, culpability or a failure to act, by or on behalf of any indemnified
party.
(e) If for any reason the foregoing indemnity is unavailable or is
insufficient to hold harmless an indemnified party under Sections 2.9(a), (b) or
(c), then each indemnifying party shall contribute to the amount paid or payable
by such indemnified party as a result of any Claim in such proportion as is
appropriate to reflect the relative fault of the indemnifying party, on the one
hand, and the indemnified party, on the other hand, with respect to such
offering of securities. The relative fault 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 the indemnifying party or the indemnified party and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such untrue statement or omission. If, however, the
allocation provided in the second preceding sentence is not permitted by
applicable law, then each indemnifying party shall contribute to the amount paid
or payable by such indemnified party in such proportion as is appropriate to
reflect not only such relative faults but also the relative benefits of the
indemnifying party and the indemnified party as well as any other relevant
equitable considerations. The parties hereto agree that it would not be just and
equitable if contributions pursuant to this Section 2.9(e) were to be determined
by pro rata allocation or by any other method of allocation which does not take
account of the equitable considerations referred to in the preceding sentences
of this Section 2.9(e). The amount paid or payable in respect of any Claim shall
be deemed to include any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such Claim.
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. Notwithstanding
anything in this section 2.9(e) to the contrary, no indemnifying party (other
than the Company) shall be required pursuant to this section 2.9(e) to
contribute any amount in excess of the net proceeds received by such
indemnifying party from the sale of Registrable Securities in the offering to
which the losses, claims, damages or liabilities of the indemnified parties
relate, less the amount of any indemnification payment made by such indemnifying
party pursuant to Sections 2.9(b) and (c).
(f) The indemnity and contribution agreements contained herein shall
be in addition to any other rights to indemnification or contribution which any
indemnified party may have pursuant to law or contract and shall remain
operative and in full force and effect regardless of any investigation made or
omitted by or on behalf of any indemnified party and shall survive the transfer
of the Registrable Securities by any such party.
(g) The indemnification and contribution required by this Section 2.9
shall be made by periodic payments of the amount thereof during the course of
the
investigation or defense, as and when bills are received or expense, loss,
damage or liability is incurred.
3. Underwritten Offerings.
3.1 Requested Underwritten Offerings. If requested by the underwriters for
any underwritten offering by the Investors pursuant to a registration requested
under Section 2.1, the Company shall enter into a customary underwriting
agreement with the underwriters. Such underwriting agreement shall be
satisfactory in form and substance to the Majority Participating Holders and
shall contain such representations and warranties by, and such other agreements
on the part of, the Company and such other terms as are generally prevailing in
agreements of that type, including, without limitation, indemnities and
contribution agreements on substantially the same terms as those contained
herein. Any Holder participating in the offering shall be a party to such
underwriting agreement and may, at its option, require that any or all of the
representations and warranties by, and the other agreements on the part of, the
Company to and for the benefit of such underwriters shall also be made to and
for the benefit of such Holder and that any or all of the conditions precedent
to the obligations of such underwriters under such underwriting agreement be
conditions precedent to the obligations of such Holder; provided, however, that
the Company shall not be required to make any representations or warranties with
respect to written information specifically provided by a selling Holder for
inclusion in the registration statement. Each such Holder shall not be required
to make any representations or warranties to or agreements with the Company or
the underwriters other than representations, warranties or agreements regarding
such Holder, its ownership of and title to the Registrable Securities, and its
intended method of distribution; and any liability of such Holder to any
underwriter or other Person under such underwriting agreement shall be limited
to liability arising from breach of its representations and warranties and shall
be limited to an amount equal to the proceeds (net of expenses and underwriting
discounts and commissions) that it derives from such registration.
3.2 Piggyback Underwritten Offerings. In the case of a registration
pursuant to Section 2.2 hereof, if the Company shall have determined to enter
into an underwriting agreement in connection therewith, any Registrable
Securities to be included in such registration shall be subject to such
underwriting agreement. Any Holder participating in such registration may, at
its option, require that any or all of the representations and warranties by,
and the other agreements on the part of, the Company to and for the benefit of
such underwriters shall also be made to and for the benefit of such Holder and
that any or all of the conditions precedent to the obligations of such
underwriters under such underwriting agreement be conditions precedent to the
obligations of such Holder. Each such Holder shall not be required to make any
representations or warranties to or agreements with the Company or the
underwriters other than representations, warranties or agreements regarding such
Holder, its ownership of and title to the Registrable Securities, and its
intended method of distribution; and any liability of such Holder to any
underwriter or other Person under such underwriting agreement shall be limited
to liability arising from breach of its representations and warranties and shall
be limited to an amount equal to the proceeds (net of expenses and underwriting
discounts and commissions) that it derives from such registration.
4. General.
4.1 Adjustments Affecting Registrable Securities. The Company agrees that
it shall not effect or permit to occur any combination or subdivision of shares
of Common Stock, Series A Convertible Preferred Stock or Series B Convertible
Preferred Stock which would adversely affect the ability of any Holder of any
Registrable Securities to include such Registrable Securities in any
registration contemplated by this Agreement or the marketability of such
Registrable Securities in any such registration. The Company agrees that it will
take all reasonable steps necessary to effect a subdivision of shares if in the
reasonable judgment of (a) the Majority Participating Holders or (b) the
managing underwriter for the offering in respect of such Demand Registration
Request, such subdivision would enhance the marketability of the Registrable
Securities. Each Holder agrees to vote all of its shares of capital stock in a
manner, and to take all other actions necessary, to permit the Company to carry
out the intent of the preceding sentence including, without limitation, voting
in favor of an amendment to the Company's Certificate of Incorporation in order
to increase the number of authorized shares of capital stock of the Company.
4.2 Rule 144. The Company covenants that (i) so long as it remains subject
to the reporting provisions of the Exchange Act, it will timely file the reports
required to be filed by it under the Securities Act or the Exchange Act
(including, but not limited to, the reports under Sections 13 and 15(d) of the
Exchange Act referred to in subparagraph (c)(1) of Rule 144 under the Securities
Act), and (ii) will take such further action as any Holder of Registrable
Securities may reasonably request, all to the extent required from time to time
to enable such Holder to sell Registrable Securities without registration under
the Securities Act within the limitation of the exemptions provided by (A) Rule
144 under the Securities Act, as such Rule may be amended from time to time, or
(B) any similar rule or regulation hereafter adopted by the SEC. Upon the
request of any Holder of Registrable Securities, the Company will deliver to
such Holder a written statement as to whether it has complied with such
requirements.
4.3 Nominees for Beneficial Owners. If Registrable Securities are held by
a nominee for the beneficial owner thereof, the beneficial owner thereof may, at
its option, be treated as the Holder of such Registrable Securities for purposes
of any request or other action by any Holder or Holders of Registrable
Securities pursuant to this Agreement (or any determination of any number or
percentage of shares constituting Registrable Securities held by any Holder or
Holders of Registrable Securities contemplated by this Agreement), provided that
the Company shall have received assurances reasonably satisfactory to it of such
beneficial ownership.
4.4 Amendments and Waivers. The terms and provisions of this Agreement may
be modified or amended, or any of the provisions hereof waived, temporarily or
permanently, in a writing executed and delivered by the Company and each of the
Holders. No waiver of any of the provisions of this Agreement shall be deemed to
or shall constitute a waiver of any other provision hereof (whether or not
similar). No delay
on the part of any party in exercising any right, power or privilege hereunder
shall operate as a waiver thereof.
4.5 Notices. All notices, requests, consents and other communications
hereunder to any party shall be deemed to be sufficient if contained in a
written instrument delivered in person or sent by telecopy, nationally
recognized overnight courier or first class registered or certified mail, return
receipt requested, postage prepaid, addressed to such party at the address set
forth below or such other address as may hereafter be designated in writing by
such party to the other parties:
(i) if to the Company, to:
Hexcel Corporation
Two Stamford Plaza
000 Xxxxxxx Xxxxxxxxx
00xx Xxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000-0000
Telephone No.: (000) 000-0000
Fax No.: (000) 000-0000
Attention: Xxx X. Xxxxxxxx, Esq.
Senior Vice President, General Counsel and Secretary
with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
Xxxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telephone No.: (000) 000-0000
Fax No.: (000) 000-0000
Attention: Xxxxxx X. Coco, Esq. and Xxxxxx X.
Xxxxxxxxx, Esq.
(ii) if to the Investors:
Berkshire Partners LLC
Xxx Xxxxxx Xxxxx
Xxxxx 0000
Xxxxxx, Xxxxxxxxxxxxx 00000
(T) (000) 000-0000
(F) (000) 000-0000
Attention: Xx. Xxxxxx X. Small
and:
Greenbriar Equity Group LLC
000 Xxxxxxxx Xxxxx Xxxxxx
Xxxxx X-000
Xxx, Xxx Xxxx 00000
(T) (000) 000-0000
(F) (000) 000-0000
Attention: Xx. Xxxx X. Xxxxxxx
with a copy to:
Ropes & Xxxx
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Telephone No.: (000) 000-0000
Fax No.: (000) 000-0000
Attention: Xxxxx Xxxxxx, Esq. and Xxxx X. Xxx Xxxxxx, Esq.
All such notices, requests, consents and other communications shall be deemed to
have been given when received.
4.6 Miscellaneous.
(a) This Agreement shall be binding upon and inure to the benefit of
and be enforceable by the parties hereto and the respective successors, personal
representatives and assigns of the parties hereto, whether so expressed or not.
If any Person shall acquire Registrable Securities from any Holder, in any
manner, whether by operation of law or otherwise, but in compliance with the
Stockholders Agreement, such Person shall promptly notify the Company and such
Registrable Securities acquired from such Holder shall be held subject to all of
the terms of this Agreement, and by taking and holding such Registrable
Securities such Person shall be entitled to receive the benefits of and be
conclusively deemed to have agreed to be bound by and to perform all of the
terms and provisions of this Agreement. Any such successor or assign shall agree
in writing to acquire and hold the Registrable Securities acquired from such
Holder subject to all of the terms hereof. If any Holder shall acquire
additional Registrable Securities, such Registrable Securities shall be subject
to all of the terms, and entitled to all the benefits, of this Agreement.
(b) This Agreement (with the documents referred to herein or
delivered pursuant hereto), together with the Stock Purchase Agreement and the
Stockholders Agreement, embodies the entire agreement and understanding between
the parties hereto and supersedes all prior agreements and understandings
relating to the subject matter hereof.
(c) THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF DELAWARE (WITHOUT GIVING EFFECT TO CONFLICT OF
LAWS PRINCIPLES THEREOF).
(d) With respect to any suit, action or proceeding ("PROCEEDING")
arising out of or relating to this Agreement each of the parties hereto hereby
irrevocably (i) submits to the exclusive jurisdiction of the United States
District Court for the Southern District of New York or the Court of Chancery
located in the State of Delaware, County of Newcastle (the "SELECTED COURTS")
and waives any objection to venue being laid in the Selected Courts whether
based on the grounds of forum non conveniens or otherwise and hereby agrees not
to commence any such Proceeding other than before one of the Selected Courts;
PROVIDED, HOWEVER, that a party may commence any Proceeding in a court other
than a Selected Court solely for the purpose of enforcing an order or judgment
issued by one of the Selected Courts and (ii) consents to service of process in
any Proceeding by the mailing of copies thereof by registered or certified mail,
postage prepaid, or by recognized international express carrier or delivery
service, to the Company or the Investors at their respective addresses referred
to in Section 4.5 hereof; PROVIDED, HOWEVER, that nothing herein shall affect
the right of any party hereto to serve process in any other manner permitted by
law.
(e) WITH RESPECT TO ANY PROCEEDING ARISING OUT OF OR RELATING TO THIS
AGREEMENT EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY, TO THE EXTENT NOT
PROHIBITED BY APPLICABLE LAW THAT CANNOT BE WAIVED, WAIVES, AND COVENANTS THAT
IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE) ANY RIGHT TO
TRIAL BY JURY IN ANY ACTION ARISING IN WHOLE OR IN PART UNDER OR IN CONNECTION
WITH THIS AGREEMENT OR ANY OF THE CONTEMPLATED TRANSACTIONS, WHETHER NOW
EXISTING OR HEREAFTER ARISING, AND WHETHER SOUNDING IN CONTRACT, TORT OR
OTHERWISE, AND AGREES THAT ANY OF THEM MAY FILE A COPY OF THIS PARAGRAPH WITH
ANY COURT AS WRITTEN EVIDENCE OF THE KNOWING, VOLUNTARY AND BARGAINED-FOR
AGREEMENT AMONG THE PARTIES IRREVOCABLY TO WAIVE ITS RIGHT TO TRIAL BY JURY IN
ANY PROCEEDING WHATSOEVER BETWEEN THEM RELATING TO THIS AGREEMENT OR ANY OF THE
CONTEMPLATED TRANSACTIONS WILL INSTEAD BE TRIED IN A COURT OF COMPETENT
JURISDICTION BY A JUDGE SITTING WITHOUT A JURY.
(f) The headings in this Agreement are for convenience of reference
only and shall not limit or otherwise affect the meaning hereof. All section
references are to this Agreement unless otherwise expressly provided.
(g) This Agreement may be executed in any number of counterparts,
each of which shall be an original, but all of which together shall constitute
one instrument.
(h) Any term or provision of this Agreement which is invalid or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such invalidity or unenforceability without rendering invalid
or unenforceable the remaining terms and provisions of this Agreement or
affecting the validity or enforceability of any of the terms or provisions of
this Agreement in any other jurisdiction.
(i) The parties hereto agree that irreparable damage would occur in
the event that any of the provisions of this Agreement were not performed in
accordance with its specific terms or was otherwise breached. It is accordingly
agreed that the parties hereto shall be entitled to an injunction or injunctions
and other equitable remedies to prevent breaches of this Agreement and to
enforce specifically the terms and provisions hereof in any of the Selected
Courts, this being in addition to any other remedy to which they are entitled at
law or in equity. Any requirements for the securing or posting of any bond with
respect to such remedy are hereby waived by each of the parties hereto. Each
party further agrees that, in the event of any action for an injunction or other
equitable remedy in respect of such breach or enforcement of specific
performance, it will not assert the defense that a remedy at law would be
adequate.
(j) Each party hereto shall do and perform or cause to be done and
performed all such further acts and things and shall execute and deliver all
such other agreements, certificates, instruments, and documents as any other
party hereto reasonably may request in order to carry out the intent and
accomplish the purposes of this Agreement and the consummation of the
transactions contemplated hereby.
4.7 No Inconsistent Agreements. Subject to the provisions of any agreement
set forth on Schedule 4.7 hereof, the rights granted to the Holders of
Registrable Securities hereunder do not in any way conflict with and are not
inconsistent with any other agreements to which the Company is a party or by
which it is bound. Without the prior written consent of Holders of a majority of
the then outstanding Registrable Securities, the Company will not, on or after
the date of this Agreement, enter into any agreement with respect to its
securities which is inconsistent with the rights granted in this Agreement or
otherwise conflicts with the provisions hereof or provides terms and conditions
which are more favorable to, or less restrictive on, the other party thereto
than the terms and conditions contained in this Agreement are (insofar as they
are applicable) to the Holders, other than (i) the Goldman Registration Rights
Agreement and (ii) any lock-up agreement with the underwriters in connection
with any registered offering effected hereunder, pursuant to which the Company
shall agree not to register for sale, and the Company shall agree not to sell or
otherwise dispose of, Common Stock or any securities convertible into or
exercisable or exchangeable for Common Stock, for a specified period following
the registered offering. The Company further agrees that if any other
registration rights agreement entered into after the date of this Agreement with
respect to any of its securities contains terms which are more favorable to, or
less restrictive on, the other party thereto than the terms and conditions
contained in this Agreement are (insofar as they are applicable) to the Holders,
then the terms and
conditions of this Agreement shall immediately be deemed to have been amended
without further action by the Company or any of the Holders of Registrable
Securities so that the Holders shall each be entitled to the benefit of any such
more favorable or less restrictive terms or conditions.
IN WITNESS WHEREOF, the parties hereto have duly executed this
agreement as of the date first above written.
HEXCEL CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------
Name: Xxxxxxx Xxxxxxx
Title: Executive Vice President
and Chief Financial Officer
BERKSHIRE FUND V,
LIMITED PARTNERSHIP
By: Fifth Berkshire Associates LLC
its general partner
By: /s/ Xxxxxx X. Small
-----------------------------
Name: Xxxxxx X. Small
Title: Managing Director
BERKSHIRE FUND VI,
LIMITED PARTNERSHIP
By: Sixth Berkshire Associates LLC
its general partner
By: /s/ Xxxxxx X. Small
-----------------------------
Name: Xxxxxx X. Small
Title: Managing Director
BERKSHIRE INVESTORS LLC
By: /s/ Xxxxxx X. Small
-----------------------------
Name: Xxxxxx X. Small
Title: Managing Director
GREENBRIAR CO-INVESTMENT PARTNERS, L.P.
By: Greenbriar Holdings LLC
its general partner
By: /s/ Xxxx X. Xxxxxxx
-----------------------------
Name: Xxxx X. Xxxxxxx
Title: Managing Member
GREENBRIAR EQUITY FUND, L.P.
By: Greenbriar Equity Capital, L.P.,
its general partner
By: Greenbriar Holdings LLC
its general partner
By: /s/ Xxxx X. Xxxxxxx
-----------------------------
Name: Xxxx Xxxxxxx
Title: Managing Member
