REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (this "Agreement") is entered into
as of April _, 1998, by and among CCAIR, Inc., a Delaware corporation (the
"Company"), and Lynrise Air Lease, Inc., a Delaware corporation ("Lynrise").
W I T N E S S E T H:
WHEREAS, the Company has agreed to grant certain registration rights to
the Holder with respect to the shares of the Company's common stock, par value
$.01 per share (the "Common Stock"), issuable pursuant to the Company's 7%
Convertible Subordinated Note Due 2004 (the "Convertible Securities").
NOW, THEREFORE, for valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:
1. Definitions.
"Commission" means the Securities and Exchange Commission or
any other Federal agency at the time administering the Securities Act.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended, or any similar Federal statute, and the rules and regulations of the
Commission thereunder, all as the same shall be in effect at the time. Reference
to a particular section of the Exchange Act shall include a reference to the
comparable section, if any, of any such similar Federal statute.
"Holder" means Lynrise, and, subject to Section 9(f), any
assignee or transferee of a Registrable Security.
"Indemnified Party" means a party who is to be indemnified
pursuant to Section 6 hereof.
"Indemnifying Party" means a party who shall indemnify an
Indemnified Party pursuant to Section 6 hereof.
"Inspectors" has the meaning set forth in Section 4(h) hereof.
"Piggy-back Registration" means the registration of a
Registrable Security pursuant to the terms and provisions of Section 2 hereof.
"Records" has the meaning set forth in Section 4(h) hereof.
"Registrable Securities" means the shares of Common Stock
issued or issuable pursuant to the Convertible Securities and held by the
Holder, and any and all securities of the Company issued or issuable with
respect to such shares by way of a dividend, reclassification, stock split, or
other distribution or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization or otherwise.
Any Registrable Security will cease to be a Registrable Security when (i) a
registration statement covering such Registrable Security has been declared
effective by the Commission and the Registrable Security has been disposed of
pursuant to such effective registration statement, (ii) the Registrable Security
is sold to the public under circumstances in which all of the applicable
conditions of Rule 144 (or any similar provisions then in force) under the
Securities Act are met, (iii) the Registrable Security has been otherwise
transferred, the Company has delivered a new certificate or other evidence of
ownership for it not bearing a legend restricting further transfer, and the
Company has received the opinion of counsel acceptable to it that such
Registrable Security may be resold without subsequent registration under the
Securities Act, or (iv) the Registrable Security is eligible for sale pursuant
to Rule 144(k) (or any successor provision) under the Securities Act.
"Registration Expenses" is defined in Section 5.
"Securities Act" means the Securities Act of 1933, as amended,
or any similar Federal statute, and the rules and regulations of the Commission
thereunder, all as the same shall be in effect at the time. References to a
particular section of the Securities Act shall include a reference to the
comparable section, if any, of any such similar or successor Federal statute.
"Term" means that period of time as set forth in subsection
9(b).
"Underwriter" means a securities dealer which purchases any
Registrable Securities as principal and not as part of such dealer's
market-making activities.
2. Registration Rights.
A. Demand Registration.
(i) Request for Registration. If at any time the Company shall
receive a written request (specifying that it is being made pursuant to this
Section 2.A) from the Holder or Holders of at least fifty percent (50%) of the
Registrable Securities then outstanding (the "Initiating Holders"), that the
Company file a registration statement on Form S-1 under the Act, or a similar
document pursuant to any other statute then in effect corresponding to the Act,
covering the registration of at least fifty percent (50%) of the Registrable
Securities then outstanding, then the Company shall, within ten (10) days of the
receipt thereof, give written notice of such request to each Holder other than
the Initiating Holders. The Company shall, subject to the limitations contained
in subparagraphs (ii) and (iii) below, effect as soon as practicable, and in any
event within one hundred twenty (120) days of the receipt of such request from
the Initiating Holders, the registration under
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the Securities Act of all Registrable Securities requested by the Holders
pursuant to this subparagraph (i) who may request, within twenty (20) days of
the mailing of such notice by the Company, to have all or any portion of their
Registrable Securities also included in the registration. The Company shall use
its best efforts to cause any such Registration Statement to be initially filed
with the Commission within forty five (45) days of the receipt of a request from
the Initiating Holders as set forth above.
(ii) Priority of Registration. Any distribution of Registrable
Securities made pursuant to a registration request under this Section 2.A. may
be done at the option of the Holder, by means of an underwriting and, subject to
the limitations set forth in this subsection (ii), may, at the Company's option,
include other shares of Common Stock owned by other holders of the Company's
Common Stock ("Other Securityholders"). A majority in interest of the Holders
initiating the registration request (the "Initiating Holders") shall select the
Underwriter or Underwriters for such underwriting. The Company shall have the
right to disapprove any Underwriter so selected if, in its reasonable judgment,
the underwriting of the Company's securities by such Underwriter would have a
material and adverse effect on the market for the Company's securities
("Material Adverse Effect"). The right of any Holder to include his or its
Registrable Securities in such registration shall be conditioned upon such
Holder's participation in such underwriting and the inclusion of such Holder's
Registrable Securities in the underwriting to the extent provided herein. All
Holders proposing to distribute their Registrable Securities through such
underwriting shall (together with the Company) enter into an underwriting
agreement in customary form with the Underwriter or Underwriters.
Notwithstanding any other provision of this Section 2.A., if the Underwriter
advises the Initiating Holders and the Company in writing that marketing factors
require a limitation of the number of shares to be underwritten, then the
Company shall so advise all Holders and Other Securityholders which would
otherwise be underwritten pursuant hereto, and the number of shares of
Registrable Securities and other shares of Common Stock that may be included in
the underwriting shall be allocated first among all Holders, including the
Initiating Holders, in proportion (as nearly as practicable) to the amount of
Registrable Securities of the Company owned by each Holder, and, then, only if
no shares of Registrable Securities have been excluded by reason of such
Underwriters' marketing limitation, among all Other Securityholders, in
proportion (as nearly as practicable) to the amount of Common Stock owned by
each Other Securityholder or as otherwise deemed appropriate by the Company.
(iii) The Company shall be obligated to effect no more than three (3)
registrations pursuant to this Section 2.A. No registration of Registrable
Securities pursuant to this Section 2.A. which shall not have become and
remained effective shall be deemed to be a registration for any purpose of this
sentence.
(iv) Notwithstanding anything to the contrary herein, the holders of
the Convertible Securities shall not be required to convert the Convertible
Securities for Registrable Securities until the effective date of the
registration contemplated in this Section.
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B. Piggyback Registration.
(i) Request for Registration. If at any time after the date
hereof, the Company proposes to file a registration statement under the
Securities Act, including any universal or unallocated shelf registration
statement (other than a registration statement on Form S-4 or S-8 (or any
successor form that may be adopted by the Commission) or a registration
statement filed in connection with an exchange offer) with respect to an
offering of equity securities of the Company for its own account or for the
account of any of its security holders, then the Company shall give written
notice of such proposed filing to each Holder as soon as practicable (but in no
event less than 20 days before the anticipated filing date). Such notice shall
offer each Holder the opportunity to have all or any of the Registrable
Securities held by such Holder included in the registration statement proposed
to be filed or, at the Company's option, in a separate registration statement to
be filed concurrently with such registration statement (the "Piggy-back
Registration"). Within fifteen days after receiving such notice, each Holder may
make a written request to the Company that any or all of the Holder's
Registrable Securities be included in the Piggy-back Registration, which notice
shall specify the number of shares to be so included. Subject to Subsection B(2)
hereof, the Company shall include in the Piggy-back Registration (or in a
separate registration statement filed concurrently therewith) all Registrable
Securities with respect to which the Company has received written requests for
inclusion therein within fifteen days after the receipt by each Holder of the
Company's notice. The Company may in its discretion withdraw any registration
statement filed pursuant to this Section 2.B. subsequent to its filing without
liability to the Holders except with respect to expenses. Any Holder shall be
permitted to withdraw all or part of such Holder's Registrable Securities
requested to be included in a Piggy-back Registration at any time prior to the
effective date of such Piggy-back Registration without any liability for any
Registration Expenses.
(ii) Priority on Piggy-back Registration. If any Piggy-Back
Registration is to be an underwritten offering, the Company shall use
commercially reasonable efforts to cause the managing Underwriter or
Underwriters to permit the shares of Registrable Securities requested by the
Holders of Registrable Securities ("Selling Piggy-back Holders") to be included
in the Piggy-back Registration (on the same terms and conditions as similar
securities of the Company included therein to the extent appropriate).
Notwithstanding any other provision of this Section 2.B., if the Underwriter
advises the Company in writing that marketing factors require a limitation of
the number of shares to be underwritten, then the Company shall so advise each
Holder and any Other Securityholders which would otherwise be underwritten
pursuant hereto and, (i) if such Piggy-back Registration is incident to a
primary registration on behalf of the Company, the number of shares of
Registrable Securities and other shares of Common Stock that may be included in
the underwriting shall be allocated first to all securities being issued by the
Company, second to Registrable Securities of the Selling Piggy-back Holders and
to the securities of all Other Securityholders whose piggy-back rights were
obtained prior to the Date of this Agreement, collectively, in proportion (as
nearly as practicable) to the amount of securities owned by each Holder and
Other Securityholder, or otherwise as may be agreed by them and deemed
appropriate by the Company, and third, to the securities of all Other
Securityholders whose piggy-back rights were obtained on or after the Date of
this Agreement, collectively, in proportion (as nearly as practicable) to the
amount of securities
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owned by each Other Securityholder, or otherwise as may be agreed by them and
deemed appropriate by the Company, and (ii) if such Piggy-back Registration is
incident to a secondary registration on behalf of holders of securities of the
Company, the number of shares of Registrable Securities and other shares of
Common Stock that may be included in the underwriting shall be allocated first
to the Registrable Securities of the Selling Piggy-back Holders and to the
securities of all Other Securityholders whose piggy-back rights were obtained
prior to the date of this Agreement, collectively, in proportion (as nearly as
practicable) to the amount of securities owned by each Holder and Other
Securityholder, or otherwise as may be agreed by them and deemed appropriate by
the Company, and second to the securities of all Other Securityholders whose
piggy-back rights were obtained on or after the Date of this Agreement,
collectively, in proportion (as nearly as practicable) to the amount of
securities owned by each Other Securityholder, or otherwise as may be agreed by
them and deemed appropriate by the Company.
(iii) Notwithstanding anything to the contrary herein, it is
acknowledged by the parties that certain shareholders of the Company have demand
registration rights pursuant to that certain Common Stock Purchase Agreement
(the "Prior Agreement") dated as of December 3, 1997, among the Company and such
shareholders, and that pursuant to Section 7.1 of the Prior Agreement the
Company is not permitted to grant piggyback rights with respect to demand
registrations by such shareholders without their consent. The parties agree that
the piggyback rights granted herein shall be subject to the consent rights of
the parties to the Prior Agreement, to the extent applicable. The Company
covenants and agrees that (i) promptly upon the execution of this Agreement it
will use its best efforts to obtain the consent of the parties to the Prior
Agreement to waive their right of consent with respect to piggyback rights
granted hereunder, and (ii) during the term of this Agreement it will not grant
any similar consent rights to any other persons other than as may be consistent
with the terms of this Agreement.
(iv) Notwithstanding anything to the contrary herein, the holders of
the Convertible Securities shall not be required to convert the Convertible
Securities for Registrable Securities until the effective date of the
registration contemplated in this Section.
3. Holdback Agreements; Restrictions on Public Sale by Holder of
Registrable Securities. Upon inclusion by the Company of any Holder's
Registrable Securities in a registration statement filed pursuant to Section 2
hereof, such Holder agrees not to effect any public sale or distribution of the
issue being registered or a similar security of the Company or any securities
convertible into or exchangeable or exercisable for such securities, including a
sale pursuant to Rule 144 or Rule 144A under the Securities Act, during the 14
days prior to, and during the 180 day period beginning on, the effective date of
such registration statement (except as part of such registration), if and to the
extent requested by the Company in the case of a non-underwritten public
offering or if and to the extent requested by the managing Underwriter or
Underwriters in the case of an underwritten public offering. Such restriction on
sale shall not apply to any transfer of Registrable Securities by the Holder to
one or more of the Holder's affiliates.
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4. Registration Procedures.
Subject to the other provisions and limitations contained in this
Agreement, whenever any Holder has requested that any Registrable Securities be
registered pursuant to Section 2 hereof, the Company will use its best efforts
to effect the registration and the sale of such Registrable Securities in
accordance with the intended method of disposition thereof as quickly as
practicable, and in connection with any such request, the Company will as
expeditiously as possible:
(a) prepare and file with the Commission a registration
statement on any form for which the Company then qualifies and which
counsel for the Company shall deem appropriate and which form shall be
available for the sale of the Registrable Securities to be registered
thereunder in accordance with the intended method of distribution
thereof, and use its best efforts to cause such filed registration
statement to become effective under the Securities Act; provided,
however, that, (i) at least five business days before filing a
registration statement or prospectus or as promptly as practicable
prior to filing any amendments or supplements thereto, the Company will
furnish to the Holders and to one counsel selected by the Holder or
Holders of the Registrable Securities covered by such registration
statement copies of all such documents proposed to be filed, which
documents will be subject to the review of such counsel, and (ii) after
the filing of the registration statement, the Company will promptly
notify each such Holder and such counsel of comments received from, or
any stop order issued or threatened by, the Commission and take all
reasonable actions required to respond to such comments or, as the case
may be, prevent the entry of such stop order or to remove it if it has
been entered;
(b) prepare and file with the Commission 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 and comply with the provisions of the Securities
Act with respect to the disposition of all securities covered by such
registration statement until the later of (i) such time period as all
of such Registrable Securities have been disposed of in accordance with
the intended methods of disposition as set forth in such registration
statement (but no longer than 180 days after effectiveness); or (ii)
the expiration of the time when a related prospectus is required to be
delivered under the Securities Act.
(c) furnish to each Holder of Registrable Securities covered
by such registration statement, prior to filing the registration
statement, if requested, copies of such registration statement as
proposed to be filed, and thereafter furnish to each such Holder such
number of copies of such registration statement, each amendment and
supplement thereto (in each case including all exhibits thereto and
documents incorporated or deemed to be incorporated therein by
reference), the prospectus included in such registration statement
(including each preliminary prospectus), and such other documents as
each such Holder may reasonably request in order to facilitate the
disposition of the Registrable Securities owned by each such Holder;
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(d) use its best efforts to register or qualify such
Registrable Securities under such other securities or blue sky laws of
such jurisdictions as each Holder of Registrable Securities covered by
such registration statement reasonably (in light of each such Holder's
intended plan of distribution) requests and do any and all other acts
and things which may be reasonably necessary to enable each such Holder
to consummate the disposition in such jurisdictions of the Registrable
Securities owned by each such Holder and keep each such registration or
qualification (or exemption therefrom) effective during the period such
registration statement is effective; provided, however, that the
Company will not be required to (i) qualify generally to do business in
any jurisdiction where it would not otherwise be required to qualify
but for this subsection, (ii) subject itself to taxation in any such
jurisdiction, or (iii) consent to general service of process in any
such jurisdiction;
(e) use its best efforts to cause such Registrable Securities
to be registered with or approved by such other governmental agencies
or authorities as may be necessary by virtue of the business and
operations of the Company to enable each Holder of Registrable
Securities covered by the registration statement to consummate the
disposition of such Registrable Securities; provided, however, that the
Company will not be required to (i) qualify generally to do business in
any jurisdiction where it would not otherwise be required to qualify
but for this subsection, (ii) subject itself to taxation in any such
jurisdiction, or (iii) consent to general service of process in any
such jurisdiction;
(f) at any time when a prospectus relating to Registrable
Securities is required to be delivered under the Securities Act, (i)
notify each Holder of Registrable Securities covered by the
registration statement of the occurrence of an event requiring the
preparation of a supplement or amendment to such prospectus, (ii)
prepare and file such supplement, amendment or any other required
document so that, as thereafter delivered to the purchasers of such
Registrable Securities, such prospectus will not contain an untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary to make the statements
therein not misleading, and (iii) promptly make available to each such
Holder any such supplement, amendment or other document;
(g) enter into and perform customary agreements (including an
underwriting agreement in customary form with the managing Underwriter
or Underwriters, if any), use commercially reasonable efforts to obtain
any necessary consents in connection with any proposed registration and
sale of Registrable Securities, and take such other actions as are
reasonably required in order to expedite or facilitate the disposition
of such Registrable Securities;
(h) make available for inspection during business hours on
reasonable advance notice by each Holder of Registrable Securities
covered by the registration statement, any Underwriter participating in
any disposition pursuant to such registration statement, and any
attorney, accountant, or other professional retained by any such Holder
or such Underwriter (collectively, the "Inspectors"), all financial and
other records, pertinent corporate documents, and properties of the
Company (collectively, the "Records") as shall be
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reasonably necessary to enable them to exercise their due diligence
responsibility, and cause the Company's officers, directors, and
employees to supply all information reasonably requested by any such
Inspectors in connection with such registration statement. Records
which the Company determines, in good faith, to be confidential and
which it notifies the Inspectors are confidential shall not be
disclosed by the Inspectors unless (i) in the reasonable judgment of
counsel to the Company the disclosure of such Records is necessary to
avoid or correct a misstatement or omission in such registration
statement or (ii) the release of such Records is ordered pursuant to a
subpoena or other order from a court of competent jurisdiction. Each
Holder agrees that information obtained by such Holder as a result of
such inspections shall be deemed confidential and shall not be used by
such Holder as the basis for any market transactions in the securities
of the Company unless and until such is made generally available to the
public. Each Holder further agrees that such Holder will, upon learning
that disclosure of such Records is sought in a court of competent
jurisdiction, give notice to the Company and allow the Company, at the
Company's expense, to undertake appropriate action to prevent
disclosure of the Records deemed confidential;
(i) if such sale is pursuant to an underwritten offering, use
its best efforts to obtain (A) a comfort letter or comfort letters
together with auditor's consents from the Company's independent public
accountants and (B) legal opinions from the Company's legal counsel,
each in customary form and covering such matters of the type
customarily covered by comfort letters or legal opinions, as any Holder
of Registrable Securities covered by the registration statement or the
managing Underwriter or Underwriters may reasonably request;
(j) otherwise use its best efforts to comply with the
Securities Act, the Securities Exchange Act of 1934 and all applicable
rules and regulations of the Commission, and make available to its
security holders as soon as reasonably practicable, an earnings
statement covering a period of 12 months, beginning within three months
after the effective date of the registration statement, which earnings
statement shall satisfy the provisions of section 11(a) of the
Securities Act;
(k) if requested by the managing Underwriter or Underwriters,
if any, or any Holder of Registrable Securities covered by the
registration statement in connection with an underwritten offering
pursuant to Section 2 hereof, (i) promptly incorporate in a prospectus
supplement or post-effective amendment such information as the managing
Underwriter or Underwriters, if any, and/or any such Holder reasonable
requests to be included therein, as may be required by applicable laws
and (ii) make all required filings of such prospectus supplement or
such post-effective amendment as soon as practicable after the Company
has received notification of the matters to be incorporated in such
prospectus supplement or post-effective amendment; provided, however,
that the Company shall not be required to take any actions pursuant to
this Section 4(k) that are not, in the reasonable opinion of counsel
for the Company, in compliance with applicable law;
(l) use its best efforts to obtain the withdrawal of any order
suspending the effectiveness of a registration statement filed in
connection herewith, or the lifting of any
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suspension of the qualification (or exemption from qualification) of
any of the Registrable Securities for sale in any jurisdiction, at the
earliest possible moment;
(m) cooperate with each Holder of Registrable Securities
covered by the registration statement and the managing Underwriters, if
any, to facilitate the timely preparation and delivery of certificates
representing Registrable Securities to be sold, which certificates or
notes shall not bear any restrictive legends and shall be in a form
eligible for deposit with the transfer agent for the Common Stock; and
enable such Registrable Securities to be in such denominations and
registered in such names as the managing Underwriters, if any, or
holders may request at least two business days prior to any sale of
Registrable Securities;
(n) use its best efforts to qualify the Registrable Securities
for quotation on NASDAQ; and
(o) take such other actions as are reasonably required in
order to expedite or facilitate the disposition of such Registrable
Securities.
Notwithstanding the provisions of this Agreement, the Company shall be
entitled to postpone, for a reasonable period of time (which shall not exceed
120 days in any twelve-month period), the filing or effectiveness of any
registration statement under Section 2 if (A) the board of directors of the
Company determines in the good faith exercise of their reasonable business
judgment, that such registration and offering is reasonably likely to interfere
materially with bona fide financing, acquisition, or other business plans of the
Company (including a proposed primary offering by the Company of its own
securities) at the time the right to delay is exercised (whether or not a final
decision has been made to undertake such action or plan at such time) or would
require disclosure of non-public information, the premature disclosure of which
is reasonably likely to materially adversely affect the business, properties,
operations or financial results of the Company; provided, however, that the
Company shall not be required to disclose to the Holders requesting registration
any such transaction, plan or non-public information, or (B) at any time prior
to the effectiveness of any Piggy-back Registration the board of directors of
Company determines in good faith that the Company is unable to comply with the
provisions of Article 3 or Article 11 of Regulation S-X under the Securities
Act, to the extent then applicable to the Company. If the Company postpones the
filing or effectiveness of a registration statement pursuant hereto, it shall
promptly notify in writing the Holders of Registrable Securities requesting such
registration when the events or circumstances permitting such postponement have
ended and at such time shall proceed with the filing of the registration
statement as requested.
The Company may require each Holder to furnish promptly in writing to
the Company such information regarding the distribution of the Registrable
Securities as the Company may from time to time reasonably request and such
other information as may be legally required in connection with such
registration.
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Each Holder requesting registration of Registrable Securities pursuant
to Section 2 of this Agreement shall cooperate with the Company and, if
applicable, the Underwriter or Underwriters in providing such information and
executing and delivering such documents as the Company or the Underwriter or
Underwriters reasonably shall request in connection with any such registration,
and the Company shall not be obligated to include in any such registration any
Registrable Securities of any Holder who does not comply with this paragraph.
Each Holder of Registrable Securities covered by a registration
statement agrees that, upon receipt of any notice from the Company of the
happening of any event of the kind described in subsection 4(f) hereof only for
so long as provided in subsection 4(f), such Holder will forthwith discontinue
disposition of Registrable Securities pursuant to the registration statement
covering such Registrable Securities until such Holder's receipt of the copies
of the supplemented or amended prospectus contemplated by subsection 4(f)
hereof, and, if so directed by the Company, such Holder will deliver to the
Company all copies, other than permanent file copies then in such Holder's
possession, of the most recent prospectus covering such Registrable Securities
at the time of receipt of such notice. If the Company shall give such notice,
the Company shall extend the period during which such registration statement
shall be maintained effective (including the period referred to in subsection
4(b) hereof) by the number of days during the period from and including the date
of the giving of notice pursuant to subsection 4(f) hereof to the date when the
Company shall make available to such Holder a prospectus supplemented or amended
to conform with the requirements of subsection 4(f) hereof.
5. Registration Expenses.
In connection with any registration statement required to be filed
hereunder, the Company shall pay all expenses incident to performance of or
compliance with Section 2 hereof by the Company (the "Registration Expenses"),
including, but not limited to: (i) all registration and filing fees; (ii) fees
and expenses of compliance with securities or blue sky laws (including fees and
disbursements of counsel in connection with blue sky qualifications of the
Registrable Securities); (iii) printing and automated document preparation
expenses (including expenses of printing certificates for Registrable
Securities); (iv) internal expenses (including, without limitation, all salaries
and expenses of its officers and employees performing legal or accounting
duties); (v) any fees and expenses incurred in connection with the listing of
the Registrable Securities on the national securities exchange or automated
quotation system on which the Common Stock is listed; (vi) fees and
disbursements of the Company's counsel and customary fees and expenses for
independent certified public accountants retained by the Company (including the
costs associated with the delivery by independent certified public accountants
of a comfort letter or comfort letters requested pursuant to subsection 4(i)
hereof); (vii) the fees and expenses of any special experts or other persons
retained by the Company in connection with such registration; (viii) messenger,
delivery and telephone expenses related to any registration contemplated
hereunder, and (ix) reasonable fees and expenses of counsel to the Holders in an
amount not to exceed $7,500. The Company shall not have any obligation to pay
any underwriting fees, discounts, or commissions attributable to the sale of
Registrable Securities, or any out-of-pocket expenses of any Holder (or the
agents who manage the accounts of such Holder), which amounts shall be the
responsibility of the selling Holder or Holders.
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6. Indemnification; Contribution.
(a) Indemnification by the Company. The Company agrees to
indemnify and hold harmless each Holder of Registrable Securities and, if
applicable, its directors and officers and each person who controls such Holder
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act, covered by a registration statement filed pursuant to this
Agreement from and against any and all losses, claims, damages, liabilities and
expenses (including reasonable legal and other costs of investigation and
defense) (collectively, "Losses") arising out of or based upon any untrue
statement or alleged untrue statement of a material fact contained in any such
registration statement or prospectus relating to the Registrable Securities or
in any amendment or supplement thereto or in any preliminary prospectus, or
arising out of or based upon 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, except insofar as such Losses arise out of, or are based
upon, any such untrue statement or omission or allegation thereof based upon
information furnished in writing to the Company by such Holder or on such
Holder's behalf expressly for use therein; provided, however, that with respect
to any untrue statement or omission or alleged untrue statement or omission made
in any preliminary or final prospectus, the indemnity agreement contained in
this subsection shall not apply to the extent that any such Losses result from
the fact that a current copy of the prospectus was not sent or given to the
person asserting any such Losses at or prior to the written confirmation of the
sale of the Registrable Securities concerned to such person if it is determined
that it was the responsibility of such Holder to provide such person with a
current copy of the prospectus and such current copy of the prospectus would
have cured the defect giving rise to such Losses. The Company also agrees to
indemnify any Underwriters of the Registrable Securities, their officers and
directors, and each person who controls such Underwriters within the meaning of
either Section 15 of the Securities Act or Section 20 of the Exchange Act on
substantially the same basis as the indemnification of Holders provided in this
subsection 6(a).
(b) Indemnification by Holders. Each Holder agrees to
indemnify and hold harmless the Company, its directors and officers, and each
person, if any, who controls the Company within the meaning of either Section 15
of the Securities Act or Section 20 of the Exchange Act (other than the Holder),
covered by a registration statement filed pursuant to this Agreement from and
against any and all Losses arising out of or based upon any untrue statement or
alleged untrue statement of a material fact contained in any such registration
statement or prospectus relating to the Registrable Securities or in any
amendment or supplement thereto or in any preliminary prospectus, or arising out
of or based upon 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, but only insofar as such Losses arise out of, or are based upon,
any such untrue statement or omission or allegation thereof based upon
information furnished in writing to the Company by such Holder or on such
Holder's behalf, in such Holder's capacity as a Holder and not in his capacity
as a director or officer of the Company, if applicable, expressly for use
therein; provided, however, that with respect to any untrue statement or
omission or alleged untrue statement or omission made in any preliminary or
final prospectus, the indemnity agreement contained in this subsection shall not
apply to the extent that any such Losses result from the fact that a current
copy of the prospectus was not sent or given to the person asserting any such
Losses at or prior to the written confirmation of the
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sale of the Common Stock concerned to such person if it is determined that it
was the responsibility of the Company or any other person or entity (other than
the Holder) to provide such person with a current copy of the prospectus and
such current copy of the prospectus would have cured the defect giving rise to
such Losses. Each Holder also agrees to indemnify and hold harmless underwriters
of the Registrable Securities, their officers and directors, and each person who
controls such underwriters within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act on substantially the same basis
as the indemnification of the Company provided in this subsection 6(b); provided
further, however, that the obligation of such Holder to indemnify pursuant to
this subsection 6(b) shall be several, not joint and several, among such Holders
selling Registrable Securities, and the liability of each such Holder will be in
proportion to, and provided further that such liability will be limited to, the
net amount received by such Holder from the sale of its Registrable Securities
pursuant to such registration.
(c) Conduct of Indemnification Proceedings. If any action or
proceeding (including any governmental investigation) shall be brought or
asserted against any person entitled to indemnification under subsections (a) or
(b) above (an "Indemnified Party") in respect of which indemnity may be sought
from any party who has agreed to provide such indemnification (an "Indemnifying
Party"), the Indemnified Party shall promptly notify the Indemnifying Party in
writing, and the Indemnifying Party shall assume the defense thereof, including
the employment of counsel reasonably satisfactory to such Indemnified Party, and
shall assume the payment of all expenses. The Indemnified Party shall have the
right to employ separate counsel in any such action and to participate in the
defense thereof, but the fees and expenses of such counsel shall be at the
expense of such Indemnified Party unless (i) the Indemnifying Party has agreed
to pay such fees and expenses, (ii) the Indemnifying Party shall have failed to
promptly assume the defense of such action or proceeding and to employ counsel
reasonably satisfactory to the Indemnified Party, (iii) the named parties to any
such action or proceeding (including any impleaded parties) include both such
Indemnified Party and the Indemnifying Party, and such Indemnified Party shall
have been advised by counsel that there is a conflict of interest on the part of
counsel employed by the Indemnifying Party to represent such Indemnified Party,
or (iv) the Indemnified Party's counsel shall have advised the Indemnified Party
that there may be defenses available to the Indemnified Party that are different
from or in addition to those available to the Indemnifying Party and that the
Indemnifying Party is not able to assert on behalf of or in the name of the
Indemnified Party (in which case of either (iii) or (iv), if such Indemnified
Party notifies the Indemnifying Party in writing that it elects to employ
separate counsel at the expense of the Indemnifying Party, the Indemnifying
Party shall not have the right to assume the defense of such action or
proceeding on behalf of such Indemnified Party); it being understood, however,
that the Indemnifying Party shall not, in connection with any one such action or
proceeding or separate but substantially similar or related actions or
proceedings in the same jurisdiction arising out of the same general allegations
or circumstances, be liable for the fees and expenses of more than one separate
firm of attorneys (together with appropriate local counsel) at any time for all
such Indemnified Parties, which firm shall be designated in writing by such
Indemnified Parties. The Indemnifying Party shall not be liable for any
settlement of any such action or proceeding effected without its written
consent, which consent shall not be unreasonably withheld, but if settled with
its written consent, or if there be a final judgment for the plaintiff in any
such action or proceeding, the Indemnifying Party shall indemnify and hold
harmless such
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Indemnified Parties from and against any loss or liability (to the extent stated
above) by reason of such settlement or judgment.
(d) Contribution. If the indemnification provided for in this
Section 6 is unavailable to the Indemnified Parties in respect of any Losses
(other than by reason of exceptions provided in subsection 6(a) or 6(b)), then
each Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such Losses in such proportion as is appropriate to reflect the relative
fault of the Company, on the one hand, and Holders (together with any other
selling stockholders that may be obligated thereon pursuant to similar
indemnification or contribution provisions as contained herein), on the other
hand, with respect to the statements or omissions which resulted in such Losses,
or action in respect thereof, as well as any other relevant equitable
considerations. The relative fault of the Company on the one hand and of Holders
(together with any other selling stockholders that may be obligated thereon
pursuant to similar indemnification or contribution provisions as contained
herein) on the other 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 such party, and such party's relative intent, knowledge, access to
information, and opportunity to correct or prevent such statement or omission.
The Company and each Holder agree that it would not be just and
equitable if contribution pursuant to this subsection 6(d) were determined by
pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take into
account the equitable considerations referred to in the immediately preceding
subsection. Notwithstanding the provisions of this subsection 6(d), no Holder
shall be required to contribute any amount in excess of the amount by which the
total price at which the securities of such Holder were offered to the public
exceeds the amount of any damages which such Holder has otherwise been required
to pay by reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within the
meaning of subsection 11(f) of the Securities Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation.
(e) Survival. The indemnity and contribution agreements
contained in this Section 6 shall remain operative and in full force and effect
regardless of (i) any termination of this Agreement or any underwriting
agreement, (ii) any investigation made by or on behalf of any Indemnified Party
or by or on behalf of the Company, and (iii) the consummation of the sale or
successive resale of the Registrable Securities.
7. Participation in Underwritten Registrations.
No Holder may participate in any underwritten registration hereunder
unless such Holder (i) agrees to sell his securities on the basis provided in
any underwriting arrangements approved by the persons or entities entitled
hereunder to approve such arrangements and (ii) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements, and
other documents reasonably required under the terms of such underwriting
arrangements and this Agreement;
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provided, however, that no such Holder shall be required to make any
representations or warranties in connection with any such registration other
than representations and warranties as to (i) such Holder's ownership of his or
its Registrable Securities to be sold or transferred free and clear of all
liens, claims, and encumbrances, (ii) such Holder's power and authority to
effect such transfer, and (iii) such matters pertaining to compliance with
securities laws as may be reasonably requested; provided further, however, that
the obligation of such Holder to indemnify pursuant to any such underwriting
arrangements shall be several, not joint and several, among such Holders selling
Registrable Securities, and the liability of each such Holder will be in
proportion to, and provided further that such liability will be limited to, the
net amount received by such Holder from the sale of its Registrable Securities
pursuant to such registration.
8. Reports Under Securities Exchange Act of 1934. With a view to making
available to the Holders the benefits of Rule 144 promulgated under the 1933 Act
("Rule 144") and any other rule or regulation of the SEC that may at any time
permit a Holder to sell securities of the Company to the public without
registration, and with a view to making it possible for Holders to register the
Registrable Securities pursuant to a registration on Form S-3, the Company
agrees to:
(a) use its best efforts to make and keep public information
available, as those terms are understood and defined in Rule 144, at all times;
(b) take such action as will permit Holders to use Form S-3
for the sale of their Registrable Securities;
(c) use its best efforts to file with the SEC in a timely
manner all reports and other documents required of the Company under the 1933
Act and the 1934 Act; and
(d) furnish to any Holder forthwith upon request (1) a written
statement by the Company as to its compliance with the reporting requirements of
Rule 144, the 1933 Act and the 1934 Act, or as to its qualification as a
registrant whose securities may be resold pursuant to Form S-3, (2) a copy of
the most recent annual or quarterly report of the Company and such other reports
and documents so filed by the Company, and (3) such other information as may be
reasonably requested in availing any Holder of any rule or registration of the
SEC which permits the selling of any such securities without registration or
pursuant to such form.
9. Miscellaneous.
(a) Remedies. In addition to being entitled to exercise all
rights provided herein and granted by law, including recovery of damages, each
Holder will be entitled to specific performance of his rights under this
Agreement. The Company agrees that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach by it of the provisions
of this Agreement and hereby agrees to waive the defense in any action for
specific performance that a remedy at law would be adequate.
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(b) Term. The term of this Agreement shall terminate on the
earlier to occur of (i) the tenth anniversary of the date hereof or (ii) the
first date on which there are no longer any Registrable Securities (the "Term").
(c) No Inconsistent Agreements. 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 to Holders in this
Agreement or otherwise conflicts with the provisions hereof.
(d) Amendments and Waivers. The provisions of this Agreement
may not be amended, modified, or supplemented, and waivers or consents to
departures from the provisions hereof may not be given, unless the Company has
obtained the written consent of the Holders.
(e) Notices. All notices and other communications provided for
or permitted hereunder shall be made in writing by hand delivery, registered
first-class mail, telex, telecopier, or air courier guaranteeing overnight
delivery:
(i) if to the Holder, at the most current address
given to the Company in accordance with the provisions of this
subsection, which address initially is:
Lynrise Air Lease, Inc.
0000 00xx Xxxxxx, X.X., Xxxxx 0000
Xxxxxxxxxx, X.X. 00000
Telecopier: (000) 000-0000
Attention: Xx. Xxxxxxx Xxxxxxxx
with a copy to:
Xxxxxx X. Xxxx, Esq.
Ropes & Xxxx
Xxx Xxxxxxxxxxxxx Xxxxx
Xxxxxx, XX 00000
Telecopier: (000) 000-0000
(ii) if to the Company, at its most current address
and thereafter at such other address as may be designated from time to
time by notice given in accordance with the provisions of this section,
which address initially is:
CCAIR, Inc.
0000 Xxxxxxxx Xxxx
Xxxxxxxxx, XX 00000-0000
Attention: Xx. Xxxxxxx Xxxx
Telecopier: (____)
with a copy to:
-00-
Xxxxxx Xxxxxx, Xxx.
Xxxxxxxx Xxxxxxxx & Xxxxxx, P.C.
5400 Renaissance Tower
0000 Xxx Xxxxxx
Xxxxxx, Xxxxx 00000-0000
(iii) if to any other Holder, at such address set
forth on the signature pages hereto or on the Addendum to this
Agreement executed and delivered by such Holder pursuant to Section
9(f) hereof or at such other address as may be designated from time to
time by notice given in accordance with the provisions of this section.
(f) Successors and Assigns. The Company shall not assign its
rights or obligations hereunder without the prior written consent of the
Holders. Holders may assign their respective rights and obligations hereunder to
persons to whom they transfer or otherwise assign Registrable Securities. Any
assignment of rights under this Agreement in violation of the foregoing shall be
null and void. Subject to the foregoing, this Agreement shall inure to the
benefit of and be binding upon the successors and assigns of the Company and
each Holder; provided, however, that any assignee or transferee of Registrable
Securities that is deemed a Holder under this Agreement shall be entitled to the
rights and benefits afforded such person by this Agreement only upon such
person's execution and delivery of an addendum to this Agreement, in form and
substance acceptable to the Company, agreeing to be bound by the duties and
obligations of a Holder under this Agreement.
(g) Counterparts. This Agreement may be executed in a number
of identical counterparts and it shall not be necessary for the Company and each
Holder to execute each of such counterparts, but when both have executed and
delivered one or more of such counterparts, the several parts, when taken
together, shall be deemed to constitute one and the same instrument, enforceable
against each in accordance with its terms. In making proof of this Agreement, it
shall not be necessary to produce or account for more than one such counterpart
executed by the party against whom enforcement of this Agreement is sought.
(h) Headings. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
(i) Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD
TO PRINCIPLES OF CONFLICTS OR CHOICE OF LAW.
(j) Severability. If any provision of this Agreement is held
to be illegal, invalid, or unenforceable under present or future laws effective
during the term of this Agreement, such provision shall be fully severable; this
Agreement shall be construed and enforced as if such illegal, invalid, or
unenforceable provision had never comprised a part of this Agreement; and the
remaining provisions of this Agreement shall remain in full force and effect and
shall not be affected by the illegal, invalid, or unenforceable provision or by
its severance from this Agreement. Furthermore,
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in lieu of each such illegal, invalid, or unenforceable provision, there shall
be added automatically as a part of this Agreement a provision as similar in
terms to such illegal, invalid, or unenforceable provision as may be possible
and be legal, valid, and enforceable.
(k) Entire Agreement. This Agreement is intended by the
Company and the Holders as a final expression of their agreement and is intended
to be a complete and exclusive statement of their agreement and understanding in
respect of the subject matter contained herein. This agreement supersedes all
prior agreements and understandings between the Company and the Holders with
respect to such subject matter.
(l) Third Party Beneficiaries. Subject to the terms of
subsection 9(f) hereof, this Agreement is intended for the benefit of the
Company and the Holders and their respective successors and assigns and is not
for the benefit of, nor may any provision hereof be enforced by, any other
person or entity.
(m) Attorneys' Fees. In any proceeding brought to enforce any
provision of this Agreement, the successful party shall be entitled to recover
reasonable attorneys' fees in addition to its costs and expenses and any other
available remedy.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
Company: CCAIR, INC.
By:_____________________________________
Xxxxxxx X. Xxxx, Chief Executive Officer
Holder: LYNRISE AIR LEASE, INC.
By:______________________________________
By:
Title:
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