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REGISTRATION RIGHTS AGREEMENT
among
PRIME SERVICE, INC.
a Delaware corporation
and
the SHAREHOLDERS
listed on the signature pages hereof
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Dated as of October 25, 1996
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TABLE OF CONTENTS
Page
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PREAMBLE.......................................................................1
RECITALS.......................................................................1
Section 1. Definitions.....................................................1
Section 2. Incidental Registration.........................................3
Section 3. Limitations on Incidental Registration..........................4
Section 4. Registration on Request.........................................5
Section 5. Underwritten Offerings..........................................6
Section 6. Registration Procedures.........................................7
Section 7. Expenses of Registration........................................7
Section 8. Indemnification.................................................8
Section 9. Miscellaneous..................................................10
Exhibit A Sample IPO Lock-Up Agreement
Exhibit B Schedule of Registrable Stock
REGISTRATION RIGHTS AGREEMENT
REGISTRATION RIGHTS AGREEMENT (this "Agreement"), dated as of
October 25, 1996, among PRIME SERVICE, INC., a Delaware corporation (the
"Company"), and the entities listed on the signature pages of this Agreement as
the "SHAREHOLDERS" (the "Shareholders").
W I T N E S S E T H :
WHEREAS, the Company intends to effect an initial public offering
of its Common Stock (the "IPO");
WHEREAS, the shares of Common Stock held by the Shareholders are
eligible for sale in the public market in compliance with Rule 144 or Regulation
S, each promulgated under the Securities Act of 1933, as amended (the "Act");
WHEREAS, the Company believes that unorganized sales of shares of
Common Stock by the Shareholders in the public market could have an adverse
effect on prevailing market prices for the Common Stock and could adversely
impact the Company's ability to effect the IPO;
WHEREAS, in order to sustain an orderly market for the Common
Stock the Company desires that each of the Shareholders execute lock-up
agreements with respect to the shares of Common Stock held by each such
Shareholder (the "IPO Lock-Up Agreements") pursuant to which the Shareholders
agree, for a period of 180 days after the date of the IPO (the "IPO Lock-up
Period") not to offer, sell, transfer or otherwise dispose of any shares of
Common Stock without the prior written consent of the Underwriters; and
WHEREAS, in order to induce the Shareholders to enter into the
IPO Lock-Up Agreements, and in consideration therefor, the Company has agreed to
grant registration rights to the Shareholders with respect to the shares of
Common Stock as set forth herein.
NOW, THEREFORE, the parties hereto agree as follows:
1. DEFINITIONS.
(a) As used in this Agreement the following terms shall
have the following meanings:
"ACT": as defined in the preamble.
"COMMISSION": the Securities and Exchange Commission or any
other federal agency at the time administering the Act.
"COMMON STOCK": the common stock, $0.01 par value, of the
Company.
"COMPANY": as defined in the preamble.
"EFFECTIVE DATE": the date on which the Registration
Statement, registration Number 333-11517, of the Company's Common Stock is
declared effective under the Act.
"EXCHANGE ACT": the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission thereunder.
"GAAP": generally accepted accounting principles in the
United States of America in effect from time to time.
"HOLDER": a Shareholder or a Permitted Transferee.
"INITIATING SHAREHOLDER": means Investcorp S.A., so long as
such entity or one or more of its affiliates is holding Registrable Stock
outstanding at the time and initiating a request for registration pursuant to
Section 4(a).
"IPO": as defined in the preamble.
"IPO LOCK-UP AGREEMENTS": as defined in the preamble and a
copy of which is attached hereto as Exhibit A.
"IPO LOCK-UP PERIOD": as defined in the preamble.
"PERMITTED TRANSFER": any transfer of the Common Stock that
is permitted under the terms of the IPO Lock-Up Agreements.
"PERMITTED TRANSFEREE": any transferee that receives Common
Stock in a transfer of the Common Stock which is permitted under the terms of
the IPO Lock-Up Agreements, and who agrees in writing to become bound by the
terms of this Agreement.
"PERSON": an individual, partnership, joint venture,
corporation, trust, unincorporated organization or a government or any
department or agency thereof.
"PIGGYBACK NOTICE": as defined in Section 2.
"PROSPECTIVE SELLER": with respect to any registration, a
Holder that proposes to include shares of Registrable Stock in such
registration.
"REGISTER," "REGISTERED" and "REGISTRATION": a registration
effected by preparing and filing a registration statement in compliance with the
Act, the declaration or ordering of effectiveness of such registration statement
by the Commission and the compliance
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with all applicable state securities or blue sky laws which will permit the sale
of Registrable Stock to the public.
"REGISTRABLE STOCK": (i) those shares of Common Stock held
by Shareholders that were received by such Shareholders upon conversion of
shares of the Company's Class A Stock, Class C Stock or Class D Stock to Common
Stock upon the consummation of the IPO pursuant to the Company's Certificate of
Designations and (ii) any Common Stock issued or issuable with respect to or in
exchange for such shares of Common Stock by reason of a stock dividend or other
distribution on such shares or stock split or in connection with a combination
of shares, recapitalization, reclassification, exchange, offer, merger,
consolidation or other reorganization. Each share of Registrable Stock shall
cease to be Registrable Stock when (a) a registration statement with respect to
the sale of such stock shall have become effective under the Act and such stock
shall have been disposed of in accordance with such registration statement,
(b) such stock ceases to be outstanding, (c) such stock is no longer held by a
Holder or (d) the fourth anniversary of the IPO has occurred. A schedule of the
number of shares of Registrable Stock held by each Shareholder as of the date of
this Agreement is attached hereto as Exhibit B.
"REGISTRATION EXPENSES": as defined in Section 7.
"UNDERWRITTEN OFFERING": a registration in which securities
of the Company are sold to an underwriter for reoffering to the public.
(b) Unless otherwise specified therein, all terms defined
in this Agreement shall have the defined meanings when used in any certificate
or document made or delivered pursuant hereto.
(c) As used herein and in any certificate or other
documents made or delivered pursuant hereto, accounting terms not defined in
Section 1(a) and accounting terms partly defined in Section 1(a) to the extent
not defined, shall have the respective meanings given to them under GAAP.
(d) Any reference to any provision of or rule under the Act
shall encompass any successor provision or rule.
(e) The words "hereof", "herein" and "hereunder" and words
of similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and section,
subsection, schedule and exhibit references are to this Agreement unless
otherwise specified.
(f) The meanings given to terms defined herein shall be
equally applicable to the singular and plural forms of such terms.
2. INCIDENTAL REGISTRATION. If the Company proposes to
register any of its securities for sale (other than a registration relating to
the sale of securities to employees of the
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Company pursuant to a stock option, stock purchase or similar plan including a
registration statement on Form S-8, an exchange offer, a Rule 145 transaction or
in connection with the acquisition of the assets or shares of or merger or
consolidation with another company), and the registration form to be used may
also be used for the registration of the Registrable Stock, then it shall give
written notice (a "Piggyback Notice"), at its expense, to all Holders then
holding Registrable Stock of its intention to do so at least 10 business days
prior to the filing of a registration statement with respect to such
registration with the Commission. The Company shall specify in the Piggyback
Notice the form and manner of, and the other relevant facts involved in, such
proposed registration. If any Holder desires to dispose of all or part of its
Registrable Stock in such registration, it shall deliver to the Company, within
10 business days after receipt of the Piggyback Notice, written notice of such
request stating the number of shares of Registrable Stock so proposed to be sold
by such Holder. Any Holder may withdraw its request for inclusion at any time
prior to five days prior to the effective date of the registration statement for
such registration. The Company shall use its commercially reasonable efforts
(and, in any event, shall comply with the provisions of Section 6) to cause all
shares of Registrable Stock specified in such written notice to be included in
such registration, subject, however, to the limitations set forth in Section 3
and provided that, for purposes of this sentence, commercially reasonable
efforts shall not require the Company or any other seller of securities of the
Company (other than a Holder of Registrable Stock), to reduce the amount or sale
price of such securities proposed to be so registered. No registration of
Registrable Stock effected under this Section 2 shall relieve the Company of its
obligation to effect registration of Registrable Stock upon the request of the
Initiating Shareholder pursuant to Section 4.
3. LIMITATIONS ON INCIDENTAL REGISTRATION.
(a) If the registration of which the Company gives notice
pursuant to Section 2 is for the purpose of permitting a disposition of
securities pursuant to an Underwritten Offering, the Piggyback Notice shall so
state, and, if requested to do so by the managing underwriter of the offering,
the Company shall have the right to limit the aggregate size of the offering or
the number of shares of Registrable Stock to be included therein by the Holders
in accordance with the provisions of Section 3(b) below.
(b) Whenever the number of shares that may be registered
pursuant to Section 2 is limited by the provisions of Section 3(a) above, the
Company shall have priority as to sales over the Holders, and each Holder hereby
agrees that he or she shall withdraw his or her securities from such
registration to the extent necessary to allow the Company or any other seller of
securities of the Company (other than a Holder of Registrable Stock) to include
all the shares it desires to include in such registration, and thereafter the
number of shares of Registrable Stock to be included in such registration shall
be allocated pro rata among holders of Registrable Stock with such allocation to
be made on the basis of the number of shares requested to be included in such
registration by such holders.
(c) Nothing herein shall be construed as creating an
obligation on the part of the Company to register Registrable Stock if the Board
of Directors of the Company shall
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have determined in its sole discretion not to proceed with a registration of its
securities whether or not a Piggyback Notice shall have previously been sent by
the Company.
4. REGISTRATION ON REQUEST.
(a) At any time following the expiration of the IPO Lock-Up
Period, the Initiating Shareholder may make by written notice a request that the
Company effect the registration under the Act of all or part of such Initiating
Shareholder's Registrable Stock, specifying the intended method or methods of
disposition thereof; PROVIDED that the Initiating Shareholder is entitled to an
aggregate of four such registrations pursuant to this Section 4(a).
(b) Upon receipt of the request of the Initiating
Shareholder under Section 4(a), the Company shall give written notice of the
requested registration within 15 days of receipt of such request to all Holders
of Registrable Stock and thereupon shall use its commercially reasonable efforts
to effect the registration under the Act of:
(i) the Registrable Stock that the Company has been so
requested to register by the Initiating Shareholder, for disposition in
accordance with the intended method or methods of disposition stated in
such request; and
(ii) all other Registrable Stock that the Company has
been requested to register by the Holders thereof by written request
delivered to the Company within 15 days after the giving of such written
notice by the Company (which request shall specify the intended method or
methods of disposition of such Registrable Stock);
all to the extent requisite to permit the disposition (in accordance with the
intended methods thereof as aforesaid) of the Registrable Stock so to be
registered, PROVIDED that if the Initiating Shareholder shall determine that the
number of shares of Common Stock to be included in such registration should be
limited due to market conditions or otherwise, the Company shall include in such
registration the number of shares of Common Stock which the Company is so
advised by the Initiating Shareholder can be sold in such offering allocated
FIRST PRO RATA among the shares of Registrable Stock requested to be registered
by the Initiating Shareholder, and the shares of Registrable Stock held by
Holders requesting pursuant to Section 4(b)(ii) that such shares be included in
such registration and SECOND, if and to the extent additional shares may be
included, PRO RATA among the Company and any other holders of shares of Common
Stock, in each case such allocation to be made on the basis of the number of
shares requested to be included in such registration by such holders and the
Company.
(c) Each registration requested pursuant to this Section 4
shall be effected by the filing of a registration statement on the applicable
form agreed to in writing by the Initiating Shareholder.
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5. UNDERWRITTEN OFFERINGS.
(a) SELECTION OF UNDERWRITERS. Whenever a registration
requested pursuant to Section 4 hereof is for an Underwritten Offering, the
Initiating Shareholder shall select managing underwriter(s) of recognized
standing to administer the offering, subject to approval by the Company with
such approval not to be unreasonably withheld, and each Holder requesting
registration of its Registrable Stock for disposition in an Underwritten
Offering agrees to include such Registrable Stock in such underwritten offering
and shall be bound by the provisions of this Section 5.
(b) UNDERWRITING AGREEMENT. If requested by the
underwriters for any Underwritten Offering of Registrable Stock pursuant to a
registration requested under Section 4 hereof, the Company shall enter into an
underwriting agreement with such underwriters for such offering, such agreement
to contain representations and warranties by the Company and other terms and
provisions not inconsistent with this Agreement as are customarily contained in
underwriting agreements with respect to secondary distributions, including,
without limitation, indemnities to the effect and to the extent provided in
Section 8 hereof; and the Company will cooperate with such Holders of
Registrable Stock to the end that the conditions precedent to the obligations of
such Holders of Registrable Stock under such underwriting agreement shall not
include conditions that are not customary in underwriting agreements with
respect to secondary distributions and shall be otherwise satisfactory to such
Holders. The Holders on whose behalf shares of Registrable Stock are to be
distributed by such underwriters shall be parties to any such underwriting
agreement and 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 Holders selling Registrable Stock. Such
Holders shall not be required by the Company to make any representations or
warranties to or agreements with the Company or the underwriters (including any
restrictions on sales inconsistent with Section 5(c) hereof) other than
reasonable representations, warranties or agreements regarding such Holder, such
Holder's Registrable Stock and such Holder's intended method or methods of
disposition and any other representation required by law. If requested by the
underwriters for any Underwritten Offering of Registrable Stock pursuant to a
registration under Section 2 hereof, the Holders on whose behalf shares of
Registrable Stock are to be distributed by such underwriters shall execute and
deliver to such underwriters and the Company an Underwriting Agreement, subject
to the limitations set forth in the preceding two sentences.
(c) RESTRICTIONS ON SALES BY HOLDERS. If any registration
subject to Section 2 or 4 shall be in connection with an Underwritten Offering
on a firm commitment basis, each Holder agrees, if and to the extent requested
in writing by the managing underwriter, not to effect any public sales or
distribution (other than as part of such Underwritten Offering pursuant to
Section 2 or 4, respectively) of Common Stock, any securities of the Company
similar to Common Stock or any securities of the Company convertible,
exchangeable or exercisable for Common Stock, including a sale pursuant to
Rule 144 or pursuant to a registered offering not being distributed on a firm
commitment basis by or through one or more underwriters, within the period from
seven days prior to the effective date of such registration statement up to
ninety (90)
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days after the effective date of such registration statement or such other
period not to exceed one hundred and eighty (180) days after the effective date
of such registration statement as may be required by such managing underwriter.
(d) RESTRICTIONS ON SALES BY THE COMPANY. The Company
agrees not to effect any public sale or distribution of any Common Stock, any
securities of the Company similar to Common Stock or any securities of the
Company convertible, exchangeable or exercisable for Common Stock (including
pursuant to a registered offering not being distributed on a firm commitment
basis by or through one or more underwriters) within the period from seven days
prior to the effective date of any registration statement that includes
Registrable Stock to be distributed by or through one or more underwriters on a
firm commitment basis up to ninety (90) days after the effective date of such
registration statement or such other period not to exceed one hundred and eighty
(180) days after the effective date of such registration statement as may be
required by such managing underwriter unless such sale or distribution is
pursuant to such registration statement (or a separate registration statement
filed concurrently); PROVIDED, HOWEVER, that the foregoing shall not prevent the
conversion or exchange of any securities pursuant to their terms into or for
other securities or the offer or sale of securities by the Company pursuant to a
dividend reinvestment plan or to its employees or directors pursuant to an
employee benefit plan.
6. REGISTRATION PROCEDURES.
(a) Each Prospective Seller shall furnish to the Company
such information as the Company may reasonably require for inclusion in the
registration statement (and the prospectus included therein).
(b) The Prospective Sellers shall not (until further
notice) effect sales of the shares covered by the registration statement after
receipt of telegraphic or written notice from the Company to suspend sales to
permit the Company to correct or update a registration statement or prospectus.
7. EXPENSES OF REGISTRATION. All expenses of registration
pursuant to either Section 2 or Section 4, including, without limitation, all
registration and filing fees, printing expenses (including reasonable expenses
of printing prospectuses), expenses of compliance with securities or blue sky
laws (including reasonable fees and disbursements of counsel in connection with
blue sky qualifications or registrations (or the obtaining of exemptions
therefrom) of Registrable Stock), fees and disbursements of counsel, auditors or
experts for the Company, expenses of any audits incidental to or required by any
such registration, expenses of all marketing and promotional efforts requested
by the managing underwriter ("Registration Expenses") shall be borne by the
Company; PROVIDED, HOWEVER, that each Prospective Seller shall bear all
underwriting discounts, commissions or fees and all brokerage fees or
commissions relating to the sale of its Registrable Stock and the fees and
expenses of counsel for such Prospective Seller.
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8. INDEMNIFICATION.
(a) INDEMNIFICATION BY THE COMPANY. In connection with any
registration statement filed pursuant to Section 2 or 4 hereof, the Company
shall indemnify and hold harmless each Holder selling Registrable Stock covered
by such registration statement, its directors, officers, employees, agents, each
other Person who participates as an underwriter in the offering or sale of such
securities and each other Person, if any, who controls such Holder or such
underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act (each, an "Indemnified Person"), against any losses, claims,
damages, liabilities or expenses (including reasonable costs of investigation
and reasonable legal expenses), joint or several, to which such Person may
become subject, insofar as such losses, claims, damages, liabilities or expenses
(or actions or proceedings in respect thereof) arise out of or are based upon
(i) any untrue statement or alleged untrue statement of any material fact
contained in any registration statement under which such securities were
registered under the Act, any preliminary prospectus, final prospectus or
summary prospectus contained therein, or any amendment thereof or supplement
thereto, or any document incorporated by reference therein, or (ii) any omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein 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 shall
reimburse such Indemnified Person for any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such loss,
claim, liability, action or proceeding, provided that the Company shall not be
liable in any such case to the extent that any such loss, claim, damage,
liability or expense (or action or proceeding in respect thereof) arises out of
or is based upon an untrue statement or alleged untrue statement or omission or
alleged omission made in such registration statement, any such preliminary
prospectus, final prospectus, summary prospectus, amendment or supplement in
reliance upon and in conformity with written information furnished to the
Company through an instrument duly executed by such Indemnified Person
specifically stating that it is for use in the preparation of such registration
statement, preliminary prospectus, final prospectus, summary prospectus,
amendment or supplement. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of such Indemnified Person
and shall survive the transfer of such securities by such seller. The Company
shall agree to a provision for contribution relating to such indemnity as shall
be reasonably requested by any seller of Registrable Shares or the underwriters.
(b) INDEMNIFICATION BY THE SELLER. The Company may
require, as a condition to including any Registrable Stock in any registration
statement filed pursuant to Section 2 or 4 hereof, that the Company shall have
received an undertaking satisfactory to it from each Prospective Seller to
indemnify and hold harmless such Person, each director of such Person, each
officer of such Person who shall sign such registration statement, each Person
who participates as an underwriter (if such underwriter so requests) in the
offering or sale of such securities and each other Person, if any, who controls
the Company or any such underwriter within the meaning of Section 15 of the Act
or Section 20 of the Exchange Act, against any losses, claims, damages,
liabilities or expenses (including reasonable costs of investigation and
8
reasonable legal expenses), joint or several, to which such Person may become
subject, insofar as such losses, claims, damages, liabilities or expenses (or
actions or proceedings in respect thereof) arise out of or are based upon
(i) any untrue statement or alleged untrue statement of any material fact
contained in any registration statement under which such securities were
registered under the Act, any preliminary prospectus, final prospectus or
summary prospectus contained therein, or any amendment thereof or supplement
thereto, or any document incorporated by reference therein, or (ii) any omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, if such
actual or alleged statement or omission described in (i) or (ii) above was made
in reliance upon and in conformity with written information furnished to such
Person through an instrument duly executed by such Prospective Seller
specifically stating that it is for use in the preparation of such registration
statement, preliminary prospectus, final prospectus, summary prospectus,
amendment or supplement. The indemnification obligations of any Prospective
Seller shall not be greater than the dollar amount of the net proceeds received
by such Prospective Seller upon the sale of the Registrable Stock giving rise to
such obligation. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of such Person or any such
director, officer, participating Person or controlling Person and shall survive
the transfer of such securities by such Prospective Seller.
(c) NOTICE OF CLAIMS, ETC. Promptly after receipt by an
indemnified party of notice of the commencement of any action, proceeding,
investigation or threat involving a claim referred to in Section 8(a) or 8(b),
such indemnified party shall, if a claim in respect thereof is to be made
against an indemnifying party, give written notice to the latter of the
commencement of such action, proceeding, investigation or threat; PROVIDED that
the failure of any indemnified party to give notice as provided herein shall not
relieve the indemnifying party of its obligations under the preceding
subdivisions of this Section 8 except to the extent that the indemnifying party
is actually prejudiced by such failure to give notice. In case any such action
is brought against an indemnified party, unless a conflict of interest between
such indemnified and indemnifying parties exists in respect of such claim, the
indemnifying party shall be entitled to participate in and to assume the defense
thereof, jointly with any other indemnifying party similarly notified, to the
extent that it may wish, and after notice from the indemnifying party to such
indemnified party of its elections so to assume the defense thereof, the
indemnifying party shall not be liable to such indemnified party for any legal
or other expenses subsequently incurred by the latter in connection with the
defense thereof other than reasonable costs of investigation. No indemnifying
party shall, without the consent of the indemnified party, which consent shall
not be unreasonably withheld or delayed, consent to entry of any judgment or
enter into any settlement that does not include as an unconditional term thereof
the giving by the claimant or plaintiff to such indemnified party of a release
from all liability in respect to such claim or litigation.
(d) OTHER INDEMNIFICATION. Indemnification similar to that
specified in the preceding subdivisions of this Section 8 (with appropriate
modifications) shall be given by the Company and each seller of Registrable
Stock with respect to any required registration or other qualification of such
Registrable Stock under any state securities or blue sky law or regulation of a
governmental authority other than the Act.
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(e) CONTRIBUTION. If the indemnification provided for in
Section 8(a) or 8(b) above is unavailable or insufficient to hold harmless an
indemnified party in respect of any losses, claims, damages or liabilities
referred to therein, then each indemnifying party, in lieu of indemnifying such
indemnified party thereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities, in such proportion as is appropriate to reflect the relative fault
of the indemnifying party on the one hand and of the indemnified parties on the
other in connection with the statements or omissions which resulted in such
losses, claims, damages or liabilities, as well as any other relevant equitable
considerations. Such relative fault shall be determined by reference to, among
other things, whether any untrue or alleged untrue statement of a material fact
or any omission or alleged omission to state a material fact relates to
information supplied by the indemnifying party, or by the indemnified parties,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company and the Holders agree that it would not be just
and equitable if contribution pursuant to this Section 8(e) were determined by
PRO RATA allocation or by any other method of allocation that does not take into
account the equitable considerations referred to in the immediately preceding
paragraph; PROVIDED that the Company and each holder of Registrable Stock shall
agree with each other and the underwriters of the Registrable Stock, if
requested by such underwriters, that the underwriter's portion of such
contribution shall not exceed the underwriting discount. The amount paid or
payable by an indemnified party as a result of the losses, claims, damages and
liabilities or actions in respect thereof referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending any such action or claim.
The contribution obligations of any Prospective Seller shall not be greater than
the excess of (A) the dollar amount of the net proceeds received by such
Prospective Seller upon the sale of the Registrable Stock giving rise to such
contribution obligation over (B) the dollar amount of any damages that such
Holder has otherwise been required to pay by reason of the untrue or alleged
untrue statement or omission or alleged omission giving rise to such obligation.
No Person guilty of fraudulent misrepresentations (within the meaning of
Section 11(f) of the Act) shall be entitled to contribution from any Person who
was not guilty of such fraudulent misrepresentation.
(f) INDEMNIFICATION PAYMENTS. The indemnification required
by this Section 8 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.
9. MISCELLANEOUS.
(a) Notices. Any notice or other communication required or
permitted to be given hereunder shall be in writing and shall be sent by
overnight courier service; or delivered (in person or by telecopy) against
receipt, in each case to the party to whom it is given: (i) if to the Company,
to it at 0000 Xxxx Xxx Xxxxx, Xxxxx 000, Xxxxxxx, Xxxxx 00000, with a copy to
Xxxxxx, Xxxx & Xxxxxxxx LLP, 000 Xxxx Xxxxxx, 00xx Xxxxx, Xxx Xxxx, Xxx Xxxx
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10016, attention: Xxxxxxx X. Xxxxxxx; and (ii) if to the Holders, to each at
the address set forth on Exhibit B to this Agreement.
Any notice or other communication given hereunder shall be
deemed given when sent, except for a notice changing a party's address, which
shall be deemed given at the time of receipt thereof.
(b) ASSIGNMENT. Except with respect to Permitted
Transferees, neither this Agreement nor any of the rights, interests or
obligations hereunder shall be assigned by the Company or the Holders without
the prior written consent of the other party, and any purported assignment shall
be void.
(c) BINDING EFFECT. The provisions of this Agreement shall
be binding upon and inure to the benefit of the Company and the Holders and
their respective successors and permitted assigns.
(d) THIRD-PARTY BENEFICIARIES. This Agreement does not
create, and shall not be construed as creating, any rights enforceable by any
Person not a party to this Agreement other than any assignee with respect to
whom the respective assignment was made in accordance with the terms hereof.
(e) EFFECTIVENESS. This Agreement shall be effective as of
the Effective Date.
(f) COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
(g) GOVERNING LAW. This Agreement and the rights and
obligations of the parties under this Agreement shall be governed by, and
construed and interpreted in accordance with, the substantive law of the State
of New York without regard to principles of choice or conflicts of laws.
(h) ATTORNEY'S FEES. In the event of litigation arising
between the parties respecting the subject matter hereof, the prevailing party
shall be entitled to recover its reasonable attorney's fees and costs.
(i) EXPENSES. Except as otherwise specifically set forth
herein, each party shall bear its own costs and expenses incurred in connection
with this Agreement or the transactions herein contemplated.
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement or caused this Agreement to be executed by their respective officers
thereunto duly authorized as of the day and year first written above.
PRIME SERVICE, INC.
By: /s/ Xxxxxx Xxxxxxx
-------------------
Name: Xxxxxx Xxxxxxx
Title: Chief Executive Officer
SHAREHOLDERS:
ARLINGTON LIMITED
By: /s/
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BALLET LIMITED
By: /s/
-------------------
CHASE NOMINEES (GUERNSEY) LIMITED
By: /s/
-------------------
DENARY LIMITED
By: /s/
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EQUIPMENT EQUITY LIMITED
By: /s/
-------------------
EQUIPMENT HOLDINGS LIMITED
By: /s/
-------------------
EQUIPMENT INVESTMENT LIMITED
By: /s/
-------------------
EQUIPMENT RENTAL LIMITED
By: /s/
------------------
EQUITY PEA LIMITED
By: /s/
-----------------
EQUITY PEB LIMITED
By: /s/
-----------------
EQUITY PEC LIMITED
By: /s/
-----------------
EQUITY PED LIMITED
By: /s/
-----------------
FLEET EQUITY LIMITED
By: /s/
-----------------
FREEPORT LIMITED
By: /s/
-----------------
GLEAM LIMITED
By: /s/
-----------------
HIGHLANDS LIMITED
By: /s/
-----------------
INVESTCORP INVESTMENT EQUITY LIMITED
By: /s/
-----------------
XXXXXXX LIMITED
By: /s/
-----------------
NEW PRIME EQUITY LIMITED
By: /s/
-----------------
NEW PRIME INVESTMENTS LIMITED
By: /s/
-----------------
NOBLE LIMITED
By: /s/
-----------------
OUTRIGGER LIMITED
By: /s/
-----------------
PE HOLDINGS LIMITED
By: /s/
-----------------
PE INVESTMENTS LIMITED
By: /s/
-----------------
PLANO LIMITED
By: /s/
-----------------
PRIME EQUITY LIMITED
By: /s/
-----------------
PRIME HOLDINGS LIMITED
By: /s/
-----------------
QUILL LIMITED
By: /s/
-----------------
RADIAL LIMITED
By: /s/
-----------------
RENTAL EQUITY LIMITED
By: /s/
-----------------
RENTAL HOLDINGS LIMITED
By: /s/
-----------------
SHORELINE LIMITED
By: /s/
-----------------
ZINNIA LIMITED
By: /s/
-----------------
12
EXHIBIT A
SAMPLE IPO LOCK-UP AGREEMENT
October , 1996
PRIME SERVICE, INC.
00000 XXXX XXX XXXXX, XXXXX 000
XXXXXXX, XX 00000
CS FIRST BOSTON CORPORATION
XXXXXXX XXXXX & CO.
XXXXXXX XXXXXXXX INC.
As Representatives of the Several Underwriters,
c/o CS First Xxxxxx Xxxxxxxxxxx,
Xxxx Xxxxxx Xxxxx,
Xxx Xxxx, X.X. 00000
CS FIRST BOSTON LIMITED
XXXXXXX XXXXX INTERNATIONAL LIMITED
SALOMON BROTHERS INTERNATIONAL LIMITED
c/o CS First Boston Limited
One Xxxxx Xxxxxx
Xxxxxx, Xxxxxxx X00 0XX
Dear Sirs:
As an inducement (i) to the Underwriters to execute the Underwriting
Agreement and (ii) to the Managers to execute the Subscription Agreement, in
each case pursuant to which an offering will be made that is intended to
result in the establishment of a public market for the Common Stock, $0.01
par value per share (the "Securities"), of Prime Service, Inc., a Delaware
corporation (the "Company"), the undersigned hereby agrees that, for a period
of 180 days after the initial public offering (the "Commencement Date") of
the Securities pursuant to the Underwriting Agreement and the Subscription
Agreement, the undersigned will not offer, sell, contract to sell, pledge or
otherwise dispose of, directly or indirectly, any shares of Securities or
securities convertible into or exchangeable or exercisable for any shares of
Securities, or publicly disclose the intention to make any such offer, sale,
pledge or disposal without the prior written consent of CS First Boston
Corporation and CS First Boston Limited or unless pursuant to (a) a bona fide
gift, (b) transfers made to family members, trusts or other similar
transfers, in each case for estate planning purposes, (c) transfers to
affiliated entities and (d) pledges in connection with loans; PROVIDED,
HOWEVER, that any person receiving or holding such Securities pursuant to
clauses (a), (b), (c) or (d) above agrees in writing with you to be bound by
the provisions of this agreement.
In furtherance of the foregoing, the Company and its transfer agent and
registrar are hereby authorized to decline to make any transfer of shares of
Securities if such transfer would constitute a violation or breach of this
Agreement.
This Agreement shall be binding on the undersigned and the respective
successors, heirs, personal representatives and assigns of the undersigned.
This Agreement shall lapse and become null and void if the Commencement Date
shall not have occurred on or before November 30, 1996.
Very truly yours,
-----------------------------
13
EXHIBIT B
SCHEDULE OF REGISTRABLE STOCK
COMMON
NAME STOCK OWNED ADDRESS CODE
---- ----------- ------------
Arlington Limited 616,594 (2)
Ballet Limited 8,349 (2)
Chase Nominees (Guernsey) Limited 512,893
Denary Limited 8,349 (1)
Equipment Equity Limited 607,889 (1)
Equipment Holdings Limited 1,197,900 (1)
Equipment Investment Limited 1,787,910 (1)
Equipment Rental Limited 1,094,380 (1)
Equity PEA Limited 901,863 (1)
Equity PEB Limited 901,863 (1)
Equity PEC Limited 1,240,062 (1)
Equity PED Limited 370,416 (1)
Fleet Equity Limited 1,197,900 (2)
Freeport Limited 616,594 (2)
Gleam Limited 8,349 (2)
Highlands Limited 8,349 (1)
Investcorp Investment Equity Limited 14,520 (2)
Xxxxxxx Limited 616,594 (1)
New Prime Equity Limited 459,757 (1)
New Prime Investments Limited 457,198 (2)
Noble Limited 8,349 (2)
Outrigger Limited 8,349 (1)
PE Holdings Limited 1,197,900 (1)
PE Investments Limited 1,197,900 (2)
Plano Limited 616,594 (1)
Prime Equity Limited 1,197,900 (1)
Prime Holdings Limited 1,197,900 (2)
Quill Limited 8,349 (2)
Radial Limited 8,349 (1)
Rental Equity Limited 1,197,900 (1)
Rental Holdings Limited 1,197,900 (2)
Shoreline Limited 8,349 (2)
Zinnia Limited 8,349 (2)
14
ADDRESS CODES
(1) PO Box 1111, West Wind Building, Harbour Drive, Xxxxxx Town, Grand
Cayman, British West Indies.
(2) PO Box 2197, West Wind Building, Harbour Drive, Xxxxxx Town, Grand
Cayman, British West Indies.
15
