STOCKHOLDERS' AGREEMENT
by and among
XXXXXX LEASE FINANCE CORPORATION,
XXXXXXX X. XXXXXX, XX,
CFW PARTNERS, L.P.,
XXXXXX XXXXXXXX XXXXXX 1995 IRREVOCABLE TRUST,
and
FLIGHTTECHNICS, LLC
as of
NOVEMBER 7, 2000
TABLE OF CONTENTS
1. DEFINITIONS............................................................1
2. RELATIONSHIP BETWEEN THIS AGREEMENT AND COMPANY'S GOVERNING DOCUMENTS..1
3. REPRESENTATIONS AND WARRANTIES.........................................2
4. INVESTOR'S RIGHT OF FIRST OFFER WITH RESPECT TO CFW SHARES.............5
5. RESTRICTIONS ON NEW ISSUANCES DURING EXCLUSIVITY PERIOD................6
6. INVESTOR'S ANTI-DILUTION RIGHTS........................................6
7. RESTRICTIONS ON TRANSFER...............................................7
8. COMPANY GOVERNANCE; VOTING AGREEMENT..................................10
9. APPOINTMENT OF COMPANY NOMINEE AS MANAGER OF EITHER FLIGHTLEASE OR
SRT ..................................................................13
10. FUNDAMENTAL TRANSACTIONS..............................................14
11. NEGOTIATING EXCLUSIVITY...............................................15
12. GENERAL PROVISIONS....................................................16
i
STOCKHOLDERS' AGREEMENT
This Stockholders' Agreement ("Agreement") is made as of November 7, 2000,
by and among Xxxxxx Lease Finance Corporation, a Delaware corporation
("Company"), Xxxxxxx X. Xxxxxx, XX, a California resident ("CFW"), CFW Partners,
L.P., a Delaware limited partnership ("CFW Partners"), the Xxxxxx Xxxxxxxx
Xxxxxx 1995 Irrevocable Trust, an irrevocable trust governed by the laws of the
State of California (together with CFW and CFW Partners, the "CFW Stockholders")
and FlightTechnics, LLC, a Delaware limited liability company ("Investor").
RECITALS
A. The CFW Stockholders are the beneficial owners of the CFW Shares.
B. On the Closing Date, (i) Company will sell to Investor, 1,300,000 newly
issued shares of Company's Common Stock pursuant to an Investment Agreement (the
"Investment Agreement"), (ii) SRT Group America will purchase all of the
outstanding stock of Xxxxxx Aeronautical Services, Inc., a California
corporation and wholly-owned subsidiary of Company, pursuant to a Share Purchase
Agreement between SRT Group America and Company, (iii) SRT Group America will
purchase all of Company's equity interest in Pacific Gas Turbine Center, LLC, a
California limited liability company, pursuant to a Member Interest Purchase
Agreement between SRT Group America and Company and (iv) Company will purchase
certain engines from SRT pursuant to an Aircraft Engine Purchase Agreement
between Company and SRT.
C. Company, the CFW Stockholders and Investor desire to enter into an
agreement to govern certain aspects of their relationship.
AGREEMENT
The parties, intending to be legally bound, agree as follows:
1. DEFINITIONS
For purposes of this Agreement, the terms and variations have the meanings
specified in Schedule 1.1.
2. RELATIONSHIP BETWEEN THIS AGREEMENT AND COMPANY'S GOVERNING DOCUMENTS
2.1 CORPORATE DOCUMENTS
The parties will exercise their respective rights and fulfill their
respective obligations in accordance with this Agreement, and in such a manner
as to carry out the intentions of this Agreement, to the maximum extent
permitted by Legal Requirements.
2.2 CONFLICT OR INVALIDITY OF PROVISIONS IN THE GOVERNING DOCUMENTS
If there is a conflict between a provision of Company's Governing
Documents and a provision of this Agreement, the Governing Documents will
prevail with respect to the
1
parties' obligations to one another. In the event there is such a conflict, each
party will take all action within its respective powers (including, in the case
of the CFW Stockholders and Investor, voting in favor of amendments to the
Governing Documents and attending meetings in person or by proxy and execution
of written consents in lieu of meetings, and including, in the case of Company,
calling special board and stockholder meetings), to provide each party with the
benefit of the rights granted to it pursuant to this Agreement, and to achieve
compliance with the procedures provided pursuant to this Agreement.
3. REPRESENTATIONS AND WARRANTIES
3.1 COMPANY'S REPRESENTATIONS AND WARRANTIES
Company represents and warrants to Investor as of the date hereof and on
the Closing Date as follows:
(a) Organization and Good Standing. Company is a corporation duly
organized, validly existing, and in good standing under the laws of Delaware.
(b) Enforceability; Authority; No Conflict.
(i) This Agreement constitutes the legal, valid, and binding
obligation of Company, enforceable against it in accordance with its terms,
subject to any applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws now or hereafter in effect relating to creditors' rights generally
or to general principles of equity. Company has the right, power and authority
to execute and deliver this Agreement and to perform its obligations under this
Agreement, and such action has been duly authorized by all necessary action by
all Governmental Bodies and the Company's Board. No approval of this Agreement
is required by the Company's stockholders.
(ii) The execution and delivery of this Agreement and the
consummation or performance of any of the Contemplated Transactions on or prior
to the Closing Date will not:
(A) breach any provision of any of the Governing
Documents of Company, or any resolution adopted by Company's stockholders and
Board;
(B) give any Governmental Body the right to exercise any
remedy or obtain any relief under any Legal Requirement or any Order to which
Company, or any of its assets, may be subject;
(C) contravene, conflict with, or result in a violation
or breach of any requirements of any Governmental Body;
(D) breach any material provision of, or give any Person
the right to declare a default or exercise any remedy under, or to accelerate
the maturity or performance of, or payment under, or to cancel, terminate, or
modify, any Company Contract; or
(E) result in the imposition or creation of any
Encumbrance upon or with respect to any of Company's material assets.
2
(iii) Except as contemplated hereby or as set forth on
Schedule 3.1(b)(iii), Company is not required to give any notice to or obtain
any Consent from any Person in connection with the execution and delivery of
this Agreement or the consummation or performance of any of the Contemplated
Transactions on or prior to the Closing Date.
(c) CFW Shares. All of the CFW Shares have been duly authorized and
validly issued and are fully paid and nonassessable. None of the CFW Shares was
issued in violation of any Legal Requirement.
3.2 REPRESENTATIONS AND WARRANTIES OF CFW STOCKHOLDERS
The CFW Stockholders hereby jointly and severally represent and warrant to
Investor as follows:
(a) Enforceability; Authority; No Conflict.
(i) This Agreement constitutes the legal, valid, and binding
obligation of each CFW Stockholder, enforceable against him or it in accordance
with its terms, subject to any applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws now or hereafter in effect relating
to creditors' rights generally or to general principles of equity. Each CFW
Stockholder has the right, power and authority to execute and deliver this
Agreement and to perform his or its obligations under this Agreement. Exhibit
3.2(a) is a Consent of Spouse, which has been duly authorized, executed and
delivered by, and constitutes the legal, valid, and binding obligation of, CFW's
spouse, enforceable against her in accordance with its terms, subject to any
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
now or hereafter in effect relating to creditors' rights generally or to general
principles of equity.
(ii) The execution and delivery of this Agreement and the
consummation or performance of any of the Contemplated Transactions on or prior
to the Closing Date will not:
(A) breach any provision of any of the Governing
Documents of CFW Partners, L.P.;
(B) give any Governmental Body the right to exercise any
remedy or obtain any relief under any Legal Requirement or any Order to which
the CFW Stockholders may be subject; or
(C) breach any provision of any Contract to which a CFW
Stockholder is a party.
(iii) Except as contemplated hereby, no CFW Stockholder is
required to give any notice to or obtain any Consent from any Person in
connection with the execution and delivery of this Agreement.
(b) Title to Shares. The CFW Stockholders are the record and
beneficial owner and holders of the securities of the Company set forth opposite
each CFW Stockholder's name on Schedule 3.2(b) (collectively, "CFW Shares").
Such securities
3
constitute all of the securities of Company beneficially owned by the CFW
Stockholders and, except as set forth on Schedule 3.2(b), the CFW Stockholders
own the CFW Shares free and clear of all Encumbrances. No legend or other
reference to any Encumbrance appears on any of the CFW Shares. Other than the
1996 Stock Option/Stock Issuance Plan, as amended to date (the "1996 Stock
Option/Stock Issuance Plan"), there are no Contracts relating to the issuance,
sale, or transfer of the CFW Shares. Only the CFW Stockholders have voting
power, power of disposition and all other stockholder rights with respect to the
CFW Shares, with no restrictions, other than pursuant to applicable securities
laws, on such Stockholder's rights of disposition pertaining to this Agreement.
3.3 REPRESENTATIONS AND WARRANTIES OF INVESTOR
Investor represents and warrants to Company and CFW as follows:
(a) Organization and Good Standing. Investor is a limited liability
company duly organized, validly existing, and in good standing under the laws of
Delaware.
(b) Enforceability; Authority; No Conflict.
(i) This Agreement constitutes the legal, valid, and binding
obligation of Investor, enforceable against it in accordance with its terms.
Investor has the right, power and authority to execute and deliver this
Agreement and to perform its obligations under this Agreement and such action
has been duly authorized by all necessary action by all Governmental Bodies and
Investor's members.
(ii) The execution and delivery of this Agreement and the
consummation or performance of any of the Contemplated Transactions on or prior
to the Closing Date will not:
(A) breach any provision of any of the Governing
Documents of Investor, or any resolution or decision adopted by Investor's
members or Governmental Bodies; or
(B) give any Governmental Body the right to exercise any
remedy or obtain any relief under any Legal Requirement or any Order to which
Investor, or any of its assets, may be subject; or
(C) contravene, conflict with, or result in a violation
or breach of any requirements of any Governmental Body.
(iii) Except as Contemplated hereby, Investor is not required
to give any notice to or obtain any Consent from any Person in connection with
the execution and delivery of this Agreement or the consummation or performance
of any of the contemplated Transactions on or prior to the Closing Date.
4. INVESTOR'S RIGHT OF FIRST OFFER WITH RESPECT TO CFW SHARES
(a) Subject to the terms and conditions of this Article 4, Investor
will have a right of first offer (the "CFW Shares Right of First Offer") to
purchase, except for options granted under the 1996 Stock Option/Stock Issuance
Plan, any or all of the CFW Shares or
4
any other equity securities of the Company hereafter acquired by any CFW
Stockholder (the "Target Shares") if such CFW Stockholder proposes to sell or
transfer to any Person other than another CFW Stockholder such Target Shares
pursuant either to: (i) a bona fide offer in writing ("Offer") from such Person,
or (ii) a determination by such CFW Stockholder to sell or otherwise transfer
such Target Shares ("Determination"). Upon either the receipt of an Offer or the
making of a Determination, such CFW Stockholder will deliver a written notice
("Notice") to Investor which includes a copy of any written proposal, term sheet
or letter of intent relating to such Offer or Determination. For a 35 day period
commencing upon the receipt of such Notice, the CFW Stockholder and Investor
will in good faith negotiate toward the execution of a definitive agreement,
which will have been approved by Investor's members, and Investor will have the
exclusive right to negotiate such a definitive agreement on terms which are
acceptable to such CFW Stockholder in its sole and absolute discretion. Investor
and the CFW Stockholder will use their Reasonable Commercial Efforts to
consummate the purchase within 120 days of the execution of the definitive
agreement. Upon termination of the 35 day period, if the parties do not execute
the definitive agreement, the CFW Stockholder may negotiate and enter into a
purchase agreement with any third party subject to Investor's consent to such
third party, which consent to such third party may not be unreasonably withheld.
If such CFW Stockholder elects, in its sole discretion, to accept bids or
proposals from multiple parties, Investor will be permitted to submit a
competing bid or proposal to such CFW Stockholder. If a definitive agreement for
the sale of such CFW Shares to a third party is not executed within 120 days
from the termination of such 35 day period, then the CFW Shares Right of First
Offer will be deemed to be revived and, such CFW Shares may not be sold unless
first reoffered to Investor in accordance with this Article 4.
(b) Notwithstanding anything in this Article 4 to the contrary, the
CFW Shares Right of First Offer will apply only to those Target Shares that,
when added to the number of shares of Common Stock already owned by Investor and
the other SAirGroup Affiliates beneficially as of the date of the Offer or
Determination, will not exceed 49.9% of the Common Stock. Subject to the
requirements below, each CFW Stockholder will be permitted to sell up to an
aggregate of the greater of 150,000 shares of Common Stock or the maximum amount
permitted by any Legal Requirement for any rolling three-month period after the
Closing Date without being subject to the CFW Shares Right of First Offer, but
only according to the following procedures. CFW Stockholder will use reasonable
efforts to provide Investor with regular indications of any intentions to sell
shares of Common Stock during this period. CFW Stockholder will deliver to
Investor a written notice by facsimile or e-mail (an "Electronic Notice") by
8:00 A.M. (Zurich time) of the business day in which the CFW Stockholder intends
to sell shares of Common Stock pursuant to this Article 4(b) (such intended date
of sale, the "Article 4(b) Sell Date"). Investor will have until 30 minutes
prior to the opening of the NASDAQ Stock Market on the Article 4(b) Sell Date
(the "Article 4(b) Deadline") to deliver Electronic Notice to CFW Stockholder of
its intent to purchase such shares of Common Stock. If by the Article 4(b)
Deadline CFW Stockholder (i) does not receive Electronic Notice from Investor or
(ii) receives Electronic Notice from Investor that it does not intend to
purchase such shares of Common Stock, then CFW Stockholder may sell such shares
of Common Stock on the NASDAQ Stock Market for a one week period beginning on
the Article 4(b) Sell
5
Date. If CFW Stockholder receives Electronic Notice from Investor of its intent
to purchase such shares of Common Stock by the Article 4(b) Deadline, then the
price per share will be the closing price per share of the Common Stock on the
NASDAQ Stock Market on the business day immediately prior to the Article 4(b)
Sell Date. During the first three months after the Closing Date, Investor will
buy any shares of Common Stock that CFW Stockholder wishes to sell at the
closing price per share of the Common Stock on the business day in which
Investor receives Electronic Notice of CFW Stockholders' intent to sell shares
of its Common Stock.
(c) Investor will lose the rights under this Article 4 if Investor
fails to purchase at least 1,700,000 additional shares at the Second Closing (as
defined in the Investment Agreement) within 18 months after the Closing Date.
Once the Investor is the beneficial owner of 3,000,000 shares of Common Stock,
but only until the five year anniversary of the Closing Date, Investor will
retain the rights under this Article 4 for as long as Investor maintains
ownership of at least 3,000,000 or more shares of Common Stock.
5. RESTRICTIONS ON NEW ISSUANCES DURING EXCLUSIVITY PERIOD
Unless Company first obtains Investor's consent, Company will not during
the Exclusivity Period, offer to sell, sell, or issue to any Strategic Investor
in any one transaction or series of transactions any Common Stock, the aggregate
offering price or fair market value of which represents 5% or more of the issued
and outstanding Common Stock. Investor will lose the rights under this Article 5
if Investor fails to purchase at least 1,700,000 additional shares of Common
Stock at the Second Closing within nine months after the Closing Date, provided
that Investor will regain the rights under this Article 5 if Investor purchases
at least 1,700,000 additional shares of Common Stock at the Second Closing
within 18 months after the Closing Date. Once the Investor is the beneficial
owner of at least 3,000,000 shares of Common Stock, but only until the three
year anniversary of the Closing Date, Investor will retain the rights under this
Article 5 for as long as Investor maintains ownership of 3,000,000 or more
shares of Common Stock.
6. INVESTOR'S ANTI-DILUTION RIGHTS.
If Company intends to engage in a public offering of its Common Stock,
Company will (i) provide Investor with written notice of such intention at least
ten days prior to the scheduled offering date, describing the securities to be
offered, the number or amount thereof, and the general terms upon which Company
proposes to effect such offering, and (ii) take such steps as are necessary to
enable Investor to participate, at its option, as a purchaser in such offering
at the same Public Offering price and on the same terms and conditions as the
offerees, such that Investor, through the exercise of such option, would
maintain its same percentage interest in the outstanding Common Stock. For the
purpose of this Article 6 a Rule 144A offering will be considered a public
offering. Investor will lose the rights under this Article 6 if Investor fails
to purchase at least 1,700,000 additional shares of Common Stock at the Second
Closing within 18 months after the Closing Date. Once the Investor is the
beneficial owner of at least 3,000,000 shares of Common Stock, but only until
the five year anniversary of the Closing Date, Investor will retain these rights
under this Article 6 for as long as Investor maintains ownership of 3,000,000 or
more shares of Common Stock which have been purchased at the First Closing and
Second Closing.
7. RESTRICTIONS ON TRANSFER
7.1 LIMITATIONS ON DISPOSITION OF INVESTOR SHARES
6
For a period of five years after the Closing Date, Investor will not make
any Disposition of all or any part of Investor Shares to any Person who is not a
SAirGroup Affiliate (such SAirGroup Affiliate to become a party to this
Agreement) unless and until:
(a) Upon either the receipt of an Offer or the delivery of a
proposal, Investor has delivered a Notice to Company of the proposed
Disposition, which includes any written proposal, term sheet or letter of intent
relating to the proposed Disposition. For a 35 day period commencing upon the
receipt of such Notice, the Company will have the exclusive right to negotiate a
definitive purchase agreement with Investor, providing for terms which are
acceptable to Company in Company's sole discretion. If Company does not enter
into an agreement to enter into such proposed Disposition within such 35 day
period, Investor may then make such proposed Disposition to any third party
subject to Company's consent to such third party, which consent to such third
party may not be unreasonably withheld. If a definitive agreement for such
proposed Disposition to a third party is not executed within 120 days following
the termination of such 35 day period, Investor must reoffer Investor Shares to
Company pursuant to this Section 7.1 prior to any other Disposition. Company's
rights under this Section 7.1 may be assigned to the CFW Stockholders so long as
CFW is the beneficial owner of 1,500,000 shares or more of Common Stock;
(b) Investor has furnished Company with an opinion of counsel for
Investor to the effect that such Disposition will not require registration of
such shares under the Securities Act; and
(c) the opinion of counsel has been concurred by Company's counsel
and Company has advised Investor of such concurrence.
7.2 LEGENDS ON CERTIFICATES
(a) Certificates Representing Investor Shares. For as long as
Investor has obligations hereunder, each certificate or other document
representing Investor Shares will contain upon its face or upon the reverse side
thereof a legend to the following effect:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). THEY MAY
NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES
UNDER SAID ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY
THAT SUCH REGISTRATION IS NOT REQUIRED.
THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD,
ASSIGNED, TRANSFERRED, ENCUMBERED, OR IN ANY MANNER DISPOSED OF
EXCEPT IN CONFORMITY WITH THE TERMS OF THE INVESTMENT AGREEMENT
DATED AS OF NOVEMBER 7, 2000, AS AMENDED FROM TIME TO TIME. THE
SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A
STOCKHOLDERS' AGREEMENT DATED AS OF NOVEMBER 7, 2000 THAT CONTAINS
CERTAIN RESTRICTIONS ON THE RIGHT TO TRANSFER AND VOTE THE SHARES.
THE COMPANY WILL UPON
7
WRITTEN REQUEST FURNISH A COPY OF SUCH AGREEMENTS TO THE HOLDER OF
THIS CERTIFICATE WITHOUT CHARGE.
THIS CERTIFICATE ALSO EVIDENCES AND ENTITLES THE HOLDER HEREOF TO
CERTAIN RIGHTS AS SET FORTH IN A RIGHTS AGREEMENT DATED AS OF
SEPTEMBER 24, 1999 BETWEEN THE COMPANY AND AMERICAN STOCK TRANSFER &
TRUST COMPANY, AS RIGHTS AGENT, AS AMENDED (THE "RIGHTS AGREEMENT"),
THE TERMS AND CONDITIONS OF WHICH ARE HEREBY INCORPORATED HEREIN BY
REFERENCE AND A COPY OF WHICH IS ON FILE AT THE PRINCIPAL EXECUTIVE
OFFICES OF THE COMPANY. UNDER CERTAIN CIRCUMSTANCES SPECIFIED IN THE
RIGHTS AGREEMENT, SUCH RIGHTS WILL BE REPRESENTED BY THIS
CERTIFICATE. THE COMPANY WILL MAIL TO THE RECORD HOLDER OF THIS
CERTIFICATE A COPY OF THE RIGHTS AGREEMENT WITHOUT CHARGE PROMPTLY
FOLLOWING RECEIPT OF A WRITTEN REQUEST THEREFOR. UNDER CERTAIN
CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY ANY PERSON WHO BECOMES A
15% STOCKHOLDER OR ANY AFFILIATE OR ASSOCIATE OF A 15% STOCKHOLDER
(AS SUCH CAPITALIZED TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) MAY
BECOME NULL AND VOID.
Company will cause the legends set forth above to be placed upon any certificate
or certificates evidencing ownership of Investor Shares, together with any other
legends that may be required by state or federal securities laws. Investor
hereby covenants and agrees to promptly surrender each such certificate to
Company for the placement of such legends thereon. Company may make a notation
of such restrictions on transfer and legends in its records.
(b) Certificates Representing CFW Shares. For as long as the CFW
Stockholders have obligations hereunder, each certificate or other document
representing the CFW Shares held by CFW will contain upon its face or upon the
reverse side thereof a legend to the following effect:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"). THEY MAY
NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR HYPOTHECATED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO THE SECURITIES
UNDER SAID ACT OR AN OPINION OF COUNSEL SATISFACTORY TO THE COMPANY
THAT SUCH REGISTRATION IS NOT REQUIRED.
THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD,
ASSIGNED, TRANSFERRED, ENCUMBERED, OR IN ANY MANNER DISPOSED OF
EXCEPT IN CONFORMITY WITH THE TERMS OF THE INVESTMENT AGREEMENT
DATED AS OF NOVEMBER 7, 2000, AS AMENDED FROM TIME TO TIME. THE
SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A
STOCKHOLDERS' AGREEMENT DATED AS OF NOVEMBER 7, 2000
8
THAT CONTAINS CERTAIN RESTRICTIONS ON THE RIGHT TO TRANSFER AND VOTE
THE SHARES. THE COMPANY WILL UPON WRITTEN REQUEST FURNISH A COPY OF
SUCH AGREEMENTS TO THE HOLDER OF THIS CERTIFICATE WITHOUT CHARGE.
THIS CERTIFICATE ALSO EVIDENCES AND ENTITLES THE HOLDER HEREOF TO
CERTAIN RIGHTS AS SET FORTH IN A RIGHTS AGREEMENT DATED AS OF
SEPTEMBER 24, 1999 BETWEEN THE COMPANY AND AMERICAN STOCK TRANSFER &
TRUST COMPANY, AS RIGHTS AGENT, AS AMENDED (THE "RIGHTS AGREEMENT"),
THE TERMS AND CONDITIONS OF WHICH ARE HEREBY INCORPORATED HEREIN BY
REFERENCE AND A COPY OF WHICH IS ON FILE AT THE PRINCIPAL EXECUTIVE
OFFICES OF THE COMPANY. UNDER CERTAIN CIRCUMSTANCES SPECIFIED IN THE
RIGHTS AGREEMENT, SUCH RIGHTS WILL BE REPRESENTED BY THIS
CERTIFICATE. THE COMPANY WILL MAIL TO THE RECORD HOLDER OF THIS
CERTIFICATE A COPY OF THE RIGHTS AGREEMENT WITHOUT CHARGE PROMPTLY
FOLLOWING RECEIPT OF A WRITTEN REQUEST THEREFOR. UNDER CERTAIN
CIRCUMSTANCES, RIGHTS BENEFICIALLY OWNED BY ANY PERSON WHO BECOMES A
15% STOCKHOLDER OR ANY AFFILIATE OR ASSOCIATE OF A 15% STOCKHOLDER
(AS SUCH CAPITALIZED TERMS ARE DEFINED IN THE RIGHTS AGREEMENT) MAY
BECOME NULL AND VOID.
Company will cause the legends set forth above to be placed upon any certificate
or certificates evidencing ownership of the CFW Shares, together with any other
legends that may be required by state or federal securities laws. Each CFW
Stockholder hereby covenants and agrees that each CFW Stockholder will promptly
surrender each such certificate to Company for the placement of such legends
thereon.
9
7.3 OPEN MARKET PURCHASES
Investor may not purchase any additional shares from any party or on the
open market for five years after the Closing Date except under the following
conditions: (a) Investor may purchase 250,000 shares of Common Stock beginning
immediately after the Closing Date (subject to the xxxxxxx xxxxxxx rules of the
Company) and (b) Investor may purchase 15% of the issued and outstanding Common
Stock within five years of the Closing Date upon the consummation within 24
months after the Closing Date of sale-leaseback transactions between the Company
and any of SRT, a Qualiflyer Group airlines or an engine repair customer of SRT
involving engines having an aggregate value of at least $60 million (excluding
the Volare transaction in process as of the date hereof); provided that (i)
Investor may not purchase more than 5% of the issued and outstanding Common
Stock in any single twelve month period; (ii) the 5% of the issued and
outstanding Common Stock that the Purchaser may purchase within the first twelve
month period will include the 250,000 shares of Common Stock purchased pursuant
to this Section 7.3; and (iii) in no event may Investor and all SAirGroup
affiliates own in the aggregate in excess of 49.9% of the Company's issued and
outstanding Common Stock. If any shares of stock are acquired in breach of this
Section 7.3, Investor will immediately sell or otherwise divest itself of shares
owned by it until such time as the effects of all such breaches of this Section
7.3 have been cured. For purposes of clarification, if sale-leaseback
transactions between the Company and any of SRT, a Qualiflyer Group airlines or
an engine repair customer of SRT involving engines having an aggregate value of
at least $60 million (excluding the Volare transaction in process as of the date
hereof) do not close within 24 months of the Closing Date, Investor's right to
purchase any shares from any party or on the open market shall be limited to the
250,000 purchase.
7.4 STOP-TRANSFER NOTICES
To ensure compliance with the restrictions referred to in this Agreement,
Company may issue appropriate "stop-transfer" instructions to its transfer
agent, if any, and, if Company transfers its own securities, it may make
appropriate notations to the same effect in its own records.
8. COMPANY GOVERNANCE; VOTING AGREEMENT
8.1 INVESTOR'S BOARD NOMINEES
(a) Amendment of By-Laws; Nominees. The Board will elect to the
Board as of the Closing Date, one nominee designated by Investor ("Investor's
Board Nominee") as a Class III Director); provided that if Investor acquires at
least an additional 1,700,000 shares of Common Stock at the Second Closing
within 18 months of the Closing Date, then the Board will amend Company's
by-laws to increase the size of the Board to seven and vote for the election to
the Board, of one additional Investor's Board Nominee. Such Investor's Board
Nominees will be treated as employee directors, and thus will receive no
compensation or equity in exchange for service on the Board.
(b) Board Committees. Until the five year anniversary of the Closing
Date and provided that no provision of any Legal Requirement is violated, the
Board will give due consideration and reasonably consider for nomination to any
new or existing
10
committee of the Board, any Investor nominee who has appropriate qualifications,
experience and background to sit on such committee.
(c) Vacancies. Until the five year anniversary of the Closing Date,
upon any resignation, removal of, or inability to serve as a director by, any
Investor's Board Nominee or other vacancy in the position of a director so
designated by Investor, including the expiration of the director's term, the CFW
Stockholders will vote for a successor nominee designated by Investor.
(d) Removal of Nominees. Until the five year anniversary of the
Closing, the CFW Stockholders will vote their Common Stock in favor of the
removal of an Investor's Board Nominee from the Board only upon the written
request of Investor. If, at any time, Investor decides to remove an Investor's
Board Nominee from the Board, with or without cause, the CFW Stockholders will
vote to remove Investor's Board Nominees.
(e) Steering Committee. Within two weeks after the Closing Date,
Company will create a three person Steering Committee, comprised of two persons
appointed by Company and one person appointed by Investor. The Steering
Committee will meet, either in person or by the telephone, to comply with the
terms of the Cooperation Agreement.
The Investor's Board Nominee elected to the Board on the Closing Date or
any successor Investor's Board Nominee elected pursuant to Section 8.1(c), will
only remain on the Board, and Investor will only retain its corresponding rights
under Sections 8.1(c) and (d), for as long as Investor maintains ownership of at
least 1,300,000 shares of Common Stock. If an additional Investor's Board
Nominee is elected to the Board after Investor acquires at least an additional
1,700,000 shares of Common Stock at the Second Closing, such Investor's Board
Nominee or his or her successor elected pursuant to Section 8.1(c), will only
remain on the Board, and Investor will only retain its corresponding rights
under Sections 8.1(c) and (d), for as long as Investor maintains ownership of at
least 3,000,000 shares of Common Stock.
Investor will lose the rights under Section 8.1(b) if Investor fails to
purchase at least 1,700,000 additional shares of Common Stock at the Second
Closing within 18 months of the Closing Date. Once the Investor is the
beneficial owner of at least 3,000,000 shares of Common Stock, but only until
the five year anniversary of the Closing Date, Investor will retain the rights
under Section 8.1(b), (c) and (d) for as long as Investor maintains ownership of
3,000,000 or more shares of Common Stock.
8.2 INVESTOR'S VOTE FOR NOMINEES TO BOARD
For as long as the CFW Stockholders are the beneficial owners of 1,500,000
shares or more of the Common Stock, but only until the five year anniversary of
the Closing Date, Investor will vote all of its Common Stock for, against,
abstain and not voted for the election and removal of directors in the same
percentage as all other shares of capital stock of the Company voted in such
election; provided, however, that nothing in this Section 8.2 will be construed
to provide the Board or any other Person with the right to nominate candidates
for director vacancies created upon any resignation, removal of, or inability of
any Investor Board Nominee to serve as a director pursuant to Section 8.1.
11
8.3 CFW STOCKHOLDER'S PROXY FOR SHAREHOLDER MEETING
CFW Stockholder will grant Investor a special irrevocable proxy to vote in
favor of the issuance and sale of additional shares of Common Stock to Investor
in accordance with the Investment Agreement, if Company stockholder approval is
required by any Legal Requirement.
8.4 APPOINTMENT OF INVESTOR NOMINEE AS MANAGER OF THE COMPANY
Within 60 days of the Closing Date, Company will appoint an individual
nominated by Investor as a technical sales personnel of Company ("Investor
Manager Nominee"), and upon any resignation, removal of, or inability to serve
in such office by, any Investor Management Nominee, provide for such vacancy to
be filled by a successor nominee designated by Investor. Until the three year
anniversary of the Closing Date, Company will not eliminate the position of a
technical sales personnel, and upon any resignation, removal of, or inability to
serve in such office by, any Investor Management Nominee, provide for such
vacancy to be filled by a successor nominee designated by Investor. At the
direction of Investor, Company will remove Investor Manager Nominee and replace
such Investor Manager Nominee with a successor nominee designated by Investor;
provided, however, that Investor will indemnify Company for any and all losses
that result from such removal. Company will have the right to remove an Investor
Manager Nominee for cause. Upon such removal for cause, Investor will have the
right to require the vacancy to be filled by a successor nominee designated by
Investor. The obligations of Company under this Section 8.4 are subject to the
Board's fiduciary duties to the stockholders of Company.
8.5 CERTAIN COVENANTS WITH REGARD TO COMPANY
Except as provided in Section 8.1(a), until the five year anniversary of
the Closing Date, the CFW Stockholders will take all Required Action to vote
their Common Stock to:
(a) oppose and vote against any (except pursuant to Section 8.1(a))
amendment to the Governing Documents that would:
(i) change the number of directors from 5;
(ii) require a vote of a supermajority of the Common Stock for
any matter except as required by law or the current Governing Documents;
(iii) eliminate the management position described in Section
8.4; or
(iv) conflict with the terms of this Agreement; and
(b) oppose and vote against any amendments to the Governing
Documents that would reduce the notice period for meetings of the Board.
12
8.6 INVESTOR'S VOTING AGREEMENT
Except as provided in Section 8.1(a), for as long as the CFW Stockholders
are the beneficial owners of 1,500,000 shares or more of the Common Stock, but
only until the five year anniversary of the Closing Date, Investor will:
(a) oppose and vote against any amendment to the Governing Documents
that would:
(i) change the number of directors from 5 (except pursuant to
Section 8.1(a); or
(ii) conflict with the terms of this Agreement.
(b) vote all of its Common Stock in the same manner, for, against,
abstain and not voted as the CFW Shares are voted or not voted with respect to
any of the following events:
(i) any increase in the number of authorized shares of Common
Stock; and
(ii) following the Exclusivity Period, (A) any acquisition of
Company by way of a merger, consolidation or share exchange, or (B) a sale of
substantially all of Company's assets.
9. APPOINTMENT OF COMPANY NOMINEE AS MANAGER OF EITHER FLIGHTLEASE OR SRT
Within 60 days of the Closing Date, Investor will cause either Flightlease
or SRT, at Company's election, to appoint an individual nominated by Company to
the sales/marketing division of either Flightlease or SRT ("Company Manager
Nominee"). Until the three year anniversary of the Closing Date, neither
Flightlease nor SRT will eliminate such position and upon any resignation,
removal of, or inability to serve in such office by, any Company Manager
Nominee, Flightlease or SRT will provide for such vacancy to be filled by a
successor nominee designated by Company. At the direction of Company, either
Flightlease or SRT will remove the Company Manager Nominee and replace such
Company Manager Nominee with a successor nominee designated by Company;
provided, however, that Company will indemnify either Flightlease or SRT for any
and all losses that result from such removal. Either Flightlease or SRT will
have the right to remove a Company Manager Nominee for cause. Upon such removal
for cause, Company will have the right to require the vacancy to be filled by a
successor nominee designated by Company. The obligations of either Flightlease
or SRT under this Section 9 are subject to their respective board of directors'
fiduciary duties to their respective stockholders.
13
10. FUNDAMENTAL TRANSACTIONS
10.1 PRIOR CONSENT
During the Exclusivity Period and subject to Section 10.3, each of Company
and the CFW Stockholders must receive the prior written consent of Investor
prior to entering into a Fundamental Transaction. Investor will lose the rights
under this Section 10.1 if Investor fails to purchase at least 1,700,000
additional shares of Common Stock at the Second Closing within 18 months after
the Closing Date. Once Investor is the beneficial owner of at least 3,000,000
shares of Common Stock, Investor will retain the rights under this Section 10.1
during the Exclusivity Period for as long as Investor maintains ownership of
3,000,000 or more shares of Common Stock.
10.2 NO SOLICITATION
During the Exclusivity Period and subject to Section 10.3, each of Company
and the CFW Stockholders may not authorize or permit any of its Representatives
to :
(a) solicit the making, submission or announcement of any proposal
for a Fundamental Transaction or take any action that could be reasonably
expected to lead to a proposal for a Fundamental Transaction other than actions
whose intent was to initiate aircraft engine transactions;
(b) furnish any information regarding Company to any Person in
connection with or in response to a proposal for a Fundamental Transaction or an
inquiry or indication of interest that could lead to a proposal for a
Fundamental Transaction;
(c) engage in discussions or negotiations with any Person with
respect to a proposal for a Fundamental Transaction;
(d) approve, endorse or recommend any proposal for a Fundamental
Transaction; or
(e) enter into any letter of intent or similar document or any
contract or agreement contemplating or otherwise relating to any Fundamental
Transaction.
Investor will lose rights under this Section 10.2 if Investor fails to
purchase at least 1,700,000 additional shares of Common Stock at the Second
Closing within 9 months after the Closing Date but such rights will be
reinstated if Investor purchases at least 1,700,000 shares of Common Stock at
the Second Closing within 18 months of the Closing Date. Once Investor is the
beneficial owner of at least 3,000,000 shares of Common Stock, Investor will
retain the rights under this Section 10.2 during the Exclusivity Period for as
long as Investor maintains ownership of 3,000,000 or more shares of Common
Stock.
10.3 EXCEPTIONS
Company may furnish nonpublic information regarding Company and Company
and the CFW Stockholders may enter into discussions with any Person in response
to a proposal for a Fundamental Transaction and enter into an agreement with any
Person to enter into a Fundamental Transaction if the Board concludes in good
faith, after having taken into account the advice of its outside legal counsel,
that such an action is required in order for
14
Board to comply with its fiduciary obligations to Company's stockholders under
applicable law.
11. NEGOTIATING EXCLUSIVITY
11.1 DISCLOSURE BY COMPANY
Following the Exclusivity Period, but only until the five year anniversary
of the Closing Date, Company will promptly advise Investor orally and in writing
(and in no event later than seven calendar days after the receipt by Company) of
any proposal in writing for a Fundamental Transaction (including the identity of
the Person making or submitting such a proposal, inquiry, indication of interest
or request and the terms thereof to the extent that disclosure of the identity
or terms does not violate Company's confidentiality obligations with respect to
such Person).
11.2 EXCLUSIVE NEGOTIATIONS FOR COMPANY PROPOSAL
Investor will have the right, upon receipt of written notification from
Company that Company has received a proposal from a Person for a Fundamental
Transaction, which Company proposes to pursue, to notify Company within seven
calendar days that Investor desires to enter into exclusive negotiations on a
definitive agreement for a Fundamental Transaction. Upon such notification from
Investor of its desire to enter into exclusive negotiations, Company must
immediately cease any existing discussions with any Person that relates to a
Fundamental Transaction. For a 35 day period commencing upon the receipt of such
notice, Company and Investor will in good faith negotiate toward the execution
of a definitive agreement subject to the approval of Investor's board and
Investor will have the exclusive right to negotiate such a definitive agreement
on terms which are acceptable to Company in its sole and absolute discretion.
Investor and Company will use their Reasonable Commercial Efforts to consummate
the purchase within 120 days of the execution of the definitive agreement. If
Company does not execute the definitive agreement within such 35 day period,
Company may negotiate and enter into a purchase agreement with any third party
subject to Investor's consent to such third party, which consent to such third
party may not be unreasonably withheld; provided that each of Company and the
CFW Stockholders will keep Investor fully informed with respect to the status of
any such negotiation. But, if Company elects, in its sole discretion to accept
bids or proposals from any other third party, then Investor will be permitted to
submit a competing bid or proposal to such Company. Investor will lose its
rights under this Section 11.2 if Investor fails to purchase at least 1,700,000
additional shares of Common Stock at the Second Closing within 18 months of the
Closing Date. Once Investor is the beneficial owner of at least 3,000,000 shares
of Common Stock, but only until the five year anniversary of the Closing Date,
Investor will retain the rights under this Section 11.2 for as long as Investor
maintains ownership of 3,000,000 or more shares of Common Stock.
11.3 DISCLOSURE BY INVESTOR
Following the Exclusivity Period, but only until the five year anniversary
of Closing Date, Investor will promptly advise Company and the CFW Stockholders
(and in no event later than seven calendar days after the receipt by Investor or
any Affiliate of Investor) of any firm proposal in writing for a purchase of
Common Stock or any inquiry or indication of interest that could lead to such a
proposal (including the terms thereof).
15
12. GENERAL PROVISIONS
12.1 EXPENSES
Except as otherwise expressly provided in this Agreement, Investor and
Company will bear its respective expenses incurred in connection with the
preparation, execution, and performance of this Agreement.
12.2 NOTICES
All notices, consents, waivers, and other communications under this
Agreement must be in writing and will be deemed given to a party when (a)
delivered to the appropriate address by hand or by nationally recognized
overnight courier service (costs prepaid); (b) sent by facsimile or e-mail with
confirmation of transmission by the transmitting equipment; or (c) received or
rejected by the addressee, if sent by certified mail, return receipt requested;
in each case to the following addresses, facsimile numbers or e-mail addresses
and marked to the attention of the individual (by name or title) designated
below (or to such other address, facsimile number, e-mail address or individual
as a party may designate by notice to the other parties):
Company:
Xxxxxx Lease Finance Corporation
0000 Xxxxxxxxx Xxx, Xxxxx 000
Xxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx, XX
Facsimile No.: 000-000-0000
E-mail Address: xxxxxxx@xxxx.xxx
with a copy to:
Xxxxxx, Xxxx & Xxxxxxxx LLP
Xxx Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxx
Facsimile No: 415-374-8411
E-mail Address: xxxxxx@xxxxxx.xxx
CFW Stockholders:
0000 Xxxxxxxxx Xxx, Xxxxx 000
Xxxxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx, XX
Facsimile No.: 000-000-0000
E-mail Address: xxxxxxx@xxxx.xxx
with a copy to:
16
Xxxxxx Godward LLP
20th Floor, Xxx Xxxxxxxx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxx
Facsimile No.: 000-000-0000
E-mail Address: xxxxxxxxxx@xxxxxx.xxx
Investor:
FlightTechnics, LLC
x/x Xxxxxxxxxxx XX
XX-0000
Xxxxxx Xxxxxxx
Xxxxxx, Xxxxxxxxxxx
Attention: Hans Xxxx Xxxxxxxx
Facsimile No.: 011-41-1-812-9813
E-mail Address: xxxxxxxx@xxxxxxxxx.xxx
and
FlightTechnics, LLC
c/o SR Technics Group
CH-8058
Zurich Airport
Zurich, Switzerland
Attention: Xxxx Xxxxxx Beyeler
Facsimile No.: 011-41-1-812-9813
Email Address: xxxxxxxx@xxxxxxxxx.xxx
with a copy to:
Xxxxx & XxXxxxxx
One Prudential Plaza
000 Xxxx Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx Xxxxxxx, Esq.
Facsimile No.: 312/861-2899
E-mail Address: xxxxxx.x.xxxxxxx@xxxxxxxx.xxx
12.3 USAGE
(a) Interpretation. In this Agreement unless a clear contrary
intention appears:
(i) the singular number includes the plural number and vice
versa;
(ii) reference to any Person includes such Person's successors
and assigns but, if applicable, only if such successors and assigns are not
prohibited by this Agreement, and reference to a Person in a particular capacity
excludes such Person in any other capacity or individually;
17
(iii) reference to any gender includes each other gender and
reference to it refers to both people and entities, as appropriate.;
(iv) reference to any agreement, document or instrument means
such agreement, document or instrument as amended or modified and in effect from
time to time in accordance with the terms thereof;
(v) reference to any Legal Requirement means such Legal
Requirement as amended, modified, codified, replaced or reenacted, in whole or
in part, and in effect from time to time, including rules and regulations
promulgated thereunder and reference to any section or other provision of any
Legal Requirement means that provision of such Legal Requirement from time to
time in effect and constituting the substantive amendment, modification,
codification, replacement or reenactment of such section or other provision;
(vi) "hereunder", "hereof", "hereto" and words of similar
import will be deemed references to this Agreement as a whole and not to any
particular Article, Section or other provision thereof;
(vii) "including" (and with correlative meaning "include")
means including without limiting the generality of any description preceding
such term;
(viii) "or" is used in the inclusive sense of "and/or";
(ix) relative to the determination of any period of time,
"from" means "from and including" and "to" means "to but excluding"; and
(x) references to documents, instruments or agreements will be
deemed to refer as well to all addenda, exhibits, schedules or amendments
thereto.
(b) Accounting Terms and Determinations. Unless otherwise specified
herein, all accounting terms used therein will be interpreted and all accounting
determinations thereunder will be made in accordance with U.S. generally
accepted accounting principles.
12.4 FURTHER ASSURANCES
The parties agree (a) to furnish upon request to each other such further
information, (b) to execute and deliver to each other such other documents, and
(c) to do such other acts and things, all as the other party may reasonably
request for the purpose of carrying out the intent of this Agreement.
12.5 INCORPORATION OF SCHEDULES
The exhibits and schedules identified in this Agreement are incorporated
herein by reference and made a part of this Agreement.
12.6 ENTIRE AGREEMENT AND MODIFICATION
On the Closing Date, except for (a) the Confidential Declaration, dated
October 24, 1999 between the Company and SRT and (b) the Letter Amendment to the
Confidential
18
Declaration, dated February 10, 2000, this Agreement supersedes all other prior
agreements among the parties with respect to its subject matter, and constitutes
(along with the documents delivered pursuant to this Agreement) a complete and
exclusive statement of the terms of the agreement between the parties with
respect to its subject matter. This Agreement may be amended, supplemented or
otherwise modified only by a written agreement executed by Company, the CFW
Stockholders and Investor. The Confidential Declaration and the Letter Amendment
to the Confidential Declaration will survive the termination of this Agreement,
and the terms of these two agreements will continue to be effect until the five
year anniversary of the Closing Date.
12.7 TIME IS OF THE ESSENCE
With regard to all dates and time periods set forth or referred to in this
Agreement, time is of the essence.
12.8 SEVERABILITY
If any court of competent jurisdiction holds any provision of this
Agreement invalid or unenforceable, the other provisions of this Agreement will
remain in full force and effect. Any provision of this Agreement held invalid or
unenforceable only in part or degree will remain in full force and effect to the
extent not held invalid or unenforceable.
12.9 ASSIGNMENTS, SUCCESSORS, NO THIRD-PARTY RIGHTS; TERMINATION
Except as set forth herein, no party may assign any of its rights or
delegate any of its obligations under this Agreement without the prior written
consent of the other parties, except that Investor may assign any of its rights
and delegate any of its obligations under this Agreement to any SAirGroup
Affiliate or to any subsequent acquirer of Investor or of all or substantially
all of Investor's business. Notwithstanding the foregoing, any CFW Stockholder
may pledge their shares, so long as the pledgee in any such transaction agrees
to be bound by the terms of this Agreement. Subject to the preceding sentences,
this Agreement will apply to, be binding in all respects upon, and inure to the
benefit of the parties' successors, heirs and permitted assigns. Nothing
expressed or referred to in this Agreement will be construed to give any Person,
other than the parties to this Agreement, any legal or equitable right, remedy,
or claim under or with respect to this Agreement or any provision of this
Agreement except such rights as will inure to a successor or permitted assignee
pursuant to this Section 12.9. This Agreement will terminate upon the closing of
the sale by CFW Stockholders or Investor of all of their respective shares.
12.10 ENFORCEMENT OF AGREEMENTS
Each party acknowledges and agrees that each other party could be damaged
irreparably if any of the provisions of this Agreement are not performed in
accordance with the specific terms and that any breach of this Agreement by any
party could not be adequately compensated in all cases by monetary damages
alone. Accordingly, each party agrees that, in addition to any other right or
remedy to which a party may be entitled, at law or in equity, it will be
entitled to enforce any provision of this Agreement by a decree of specific
performance and to temporary, preliminary and permanent injunctive relief to
19
prevent breaches or threatened breaches of any of the provisions of this
Agreement, without posting any bond or other undertaking.
12.11 WAIVER
The rights and remedies of the parties to this Agreement are cumulative
and not alternative. Neither any failure nor any delay by any party in
exercising any right, power, or privilege under this Agreement or any of the
documents referred to in this Agreement will operate as a waiver of such right,
power, or privilege, and no single or partial exercise of any such right, power,
or privilege will preclude any other or further exercise of such right, power,
or privilege or the exercise of any other right, power, or privilege. To the
maximum extent permitted by applicable law, (a) no claim or right arising out of
this Agreement or any of the documents referred to in this Agreement can be
discharged by one party, in whole or in part, by a waiver or renunciation of the
claim or right unless in writing signed by the other party; (b) no waiver that
may be given by a party will be applicable except in the specific instance for
which it is given; and (c) no notice to or demand on one party will be deemed to
be a waiver of any obligation of that party or of the right of the party giving
such notice or demand to take further action without notice or demand as
provided in this Agreement or the documents referred to in this Agreement.
12.12 JURISDICTION; SERVICE OF PROCESS; GOVERNING LAW
The Agreement will be governed by and construed in accordance with the
laws of the State of Delaware. Any Proceeding arising out of or relating to this
may be brought in the courts of the State of Delaware, County of New Castle or,
if it has or can acquire jurisdiction in the United States District Court for
the District of Delaware and each of the parties irrevocably submits to the
exclusive jurisdiction of each such court in any such Proceeding, waives any
objection it may now or hereafter have to venue or to convenience of forum,
agrees that all claims in respect of the Proceeding shall be heard and
determined only in any such court, agrees not to bring any Proceeding arising
out of or relating to this Agreement in any other court. The parties agree that
any or all of them may file a copy of this Section with any court as written
evidence of the knowing, voluntary and bargained agreement between the parties
irrevocably to waive any objections to venue or to convenience of forum. Process
in any Proceeding referred to in this Section may be served on any party
anywhere in the world. The parties hereby waive the right to a trial by jury and
any right each may have to assert the doctrine of forum non conveniens or to
object to venue to the extent any proceeding is brought in accordance with this
Section 12.12.
12.13 COUNTERPARTS
This Agreement may be executed in one or more counterparts, each of which
will be deemed to be an original copy of this Agreement and all of which, when
taken together, will be deemed to constitute one and the same agreement.
20
12.14 NO SOLICITATION
Except as may otherwise be permitted under Section 8.3 and Article 9,
neither CFW Stockholders or Company or their respective Representatives, on the
one hand, nor Flightlease or SRT or their respective Representatives, on the
other hand, will, for a period of one year following the Closing Date, solicit,
directly or indirectly, for employment any employee of the other party.
Notwithstanding the foregoing, this Section 12.14 will not apply to any general
solicitation directed at the public at large.
12.15 PUBLIC ANNOUNCEMENTS
Any public announcement or similar publicity with respect to this
Agreement will be issued, if at all, at such time and in such manner as Company,
CFW Stockholders and Investor mutually determine. Investor will not and will not
permit the CFW Stockholders to make any disclosure of this Agreement to any
Person, except with the prior written consent of Investor or as required by
Legal Requirements, and Investor understands and acknowledges that this
Agreement will be filed by Company as a public document with the Securities and
Exchange Commission. The CFW Stockholders and Company will not and will not
permit Investor to make any disclosure of this Agreement to any Person, except
with the prior written consent of Company and the CFW Stockholders or as
required by Legal Requirements.
* * * * * *
21
The parties have signed and delivered this Agreement on the date first set
forth above.
XXXXXX LEASE FINANCE CORPORATION
By: /S/ XXXXXXX X. XXXXXX, XX
-------------------------------------
Xxxxxxx X. Xxxxxx, XX
Chief Executive Officer and President
/S/ XXXXXXX X. XXXXXX, XX
-------------------------------------
Xxxxxxx X. Xxxxxx, XX, Individually
CFW PARTNERS, L.P.
By: /S/ XXXXXXX X. XXXXXX, XX
-------------------------------------
Xxxxxxx X. Xxxxxx, XX,
General Partner
XXXXXX XXXXXXXX XXXXXX 1995 IRREVOCABLE
TRUST
By: /S/ XXXXXXXXX XXXXXXXXXX
-------------------------------------
Xxxxxxxxx Xxxxxxxxxx, as Trustee
By: /S/ XXXXXX XXXXXXXX XXXXXX, XX
-------------------------------------
Xxxxxx Xxxxxxxx Xxxxxx,
as Beneficiary
FLIGHTTECHNICS, LLC
By: /S/ HANS XXXX XXXXXXXX
-------------------------------------
Hans Xxxx Xxxxxxxx
President
By: /S/ XXXX XXXXXX BEYELER
-------------------------------------
Xxxx Xxxxxx Xxxxxxx
Vice President
22
GUARANTY
Flightlease AG and SR Technics Group hereby unconditionally guarantee to each of
Xxxxxx Lease Finance Corporation ("WLFC"), Xxxxxxx X. Xxxxxx, VI, and CFW
Partners, LP., Investor's performance of Investor's obligations under this
Agreement.
The liability of each of the undersigned hereunder is independent of and not in
consideration of or contingent upon the liability of Investor and a separate
action or actions may be brought and prosecuted against each of the undersigned,
whether or not any action is brought or prosecuted against Investor or Investor
is joined in any such action or actions. Each of the undersigned's obligations
hereunder will be construed as a continuing, absolute and unconditional guaranty
of payment (and not merely of collection) and performance of all of Investor's
obligations without regard to: (i) any defense (other than payment), setoff or
counterclaim that may at any time be available to Investor against, and any
right of setoff at any time held by, WLFC; or (ii) any other circumstances
whatsoever (with or without notice to or knowledge of the undersigned), whether
or not similar to any of the foregoing, that constitutes, or might be construed
to constitute, an equitable or legal discharge of Investor, in bankruptcy or in
any other instance.
The undersigned waives: (i) the right to require WLFC to proceed against
Investor or to pursue any other remedy in WLFC's power whatsoever; (ii) the
benefit of any statute of limitations affecting Investor's liability hereunder;
(iii) any requirement of the marshalling or any other principle of election of
remedies and all rights and defenses arising out of an election of remedies by
WLFC; (iv) any right to assert against WLFC any defense (legal or equitable),
setoff, counterclaim and other right that the undersigned may now or any time
hereafter have against the undersigned; (v) promptness, diligence, presentment,
demand of payment, protest, notice of dishonor or nonpayment of any such
liabilities, suit or taking of other action by WLFC against, and any other
notice to, the undersigned. The undersigned agrees that it will be bound by each
and every ruling, order and judgment obtained by WLFC against Investor in
respect of its obligations under this Agreement, whether or not the undersigned
is a party to, or has received notice of, the action or proceeding in which such
ruling, order or judgment is issued or rendered. Without limiting the foregoing,
the obligations under this guaranty will not be discharged or otherwise affected
by any bankruptcy, reorganization or similar proceeding commenced by or against
Investor.
FLIGHTLEASE XX XX TECHNICS GROUP
By: /S/ HANS XXXX XXXXXXXX By: /S/ XXXX XXXXXX BEYELER
-------------------------------- -------------------------------------
Hans Xxxx Xxxxxxxx Xxxx Xxxxxx Beyeler
President and CEO President and CEO
By:/S/ XXXXXXXX XXXXXXX By: /S/ GEORG RADON
-------------------------------- -------------------------------------
Xxxxxxxx Xxxxxxx Georg Radon
Head of Business Development Vice President and CFO
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SCHEDULE 1.1
Definitions
An "Affiliate" of, or a Person "Affiliated" with, a Person is (a) a Person
that directly or indirectly through one or more intermediaries controls, is
controlled by, or is under common control with such Person, (b) any corporation
(and any parent or subsidiary thereof), organization or other entity of which
such Person is an officer, director, co-venturer, partner or individual
exercising similar authority and is, directly or indirectly, the beneficial
owner of 51% or more of any class of equity securities thereof, (c) any trust or
other estate in which such Person serves as a trustee or in a similar fiduciary
capacity, (d) any relative or spouse or such Person.
"Agreement" is defined in the introductory paragraph.
"Article 4(b) Deadline" is defined in Article 4(b).
"Article 4(b) Sell Date" is defined in Article 4(b).
"Board" means Company's board of directors.
"CFW" is defined in the introductory paragraph.
"CFW Board Nominees" is defined in Section 8.2.
"CFW Partners" is defined in the introductory paragraph
"CFW Stockholders" means CFW and CFW Partners, L.P.
"CFW Shares" is defined in Section 3.2(b).
"CFW Shares Right of First Offer" is defined in Article 4.
"Closing Date" means the "First Closing Date" as defined in that certain
Investment Agreement by and among Investor and Company dated as of the date
hereof.
"Common Stock" means Company's issued and outstanding common stock, par
value $0.01 per share, and shares of stock or other securities, now or hereafter
authorized and outstanding, of any class resulting from the reclassification,
split, combination or other change thereof, dividends of securities paid thereon
and securities of any other issuer received in exchange for such Common Stock in
connection with any merger, consolidation, reorganization or acquisition
involving Company and all rights, warrants, options, convertible securities or
indebtedness, exchangeable securities or indebtedness, or other rights, which,
at such time, are directly or indirectly exercisable for, or convertible or
exchangeable into, Common Stock or securities convertible into Common Stock.
"Company" is defined in the introductory paragraph.
"Company Contract" means any material contract (a) under which Company has
or may acquire any rights or benefits having a monetary value of greater than
$250,000, (b)
24
under which Company has or may become subject to any obligation or liability
having a monetary value of greater than $250,000, or (c) by which any of the
assets owned or used by Company, which have a monetary value of greater than
$250,000, may become bound.
"Company Manager Nominee" is defined in Article 9.
"Consent" means any approval, consent, ratification, waiver, or other
authorization.
"Contemplated Transactions" means all of the transactions contemplated by
this Agreement, the Share Purchase Agreement by and among SRT Group America and
Company, the Investment Agreement by and between Company and Investor, the
Member Interest Purchase Agreement by and among SRT Group America and Company,
and the Aircraft Engine Purchase Agreement between Company and SRT, all such
agreements dated as of the date hereof.
"Contract" means any material agreement, contract, lease, proxy, power of
attorney, consensual obligation, promise, or undertaking (whether written or
oral and whether express or implied), whether or not legally binding.
"Cooperation Agreement" means the Cooperation Agreement between Company
and SRT dated as of the date hereof.
"Determination" is defined in Article 4.
"Disposition" means any assignment, conveyance, donation, Encumbrance,
gift, hypothecation, pledge, sale, transfer, or other disposition of any Common
Stock or any interest therein, whether voluntary or involuntary, and whether
during a stockholder's lifetime or upon or after his death, including by
operation of law, by court order, by judicial process or by foreclosure, levy or
attachment.
"Electronic Notice" is defined in Article 4(b).
"Encumbrance" means any charge, claim, community or other marital property
interest, condition, equitable interest, lien, option, pledge, security
interest, mortgage, right of way, easement, encroachment, servitude, right of
first option, right of first refusal or restriction of any kind, including any
restriction on use, voting (in the case of any Security), transfer, receipt of
income, or exercise of any other attribute of ownership.
"Exclusivity Period" means the period beginning on the Closing Date and
ending 3 years thereafter.
"Flightlease" means Flightlease AG, a company organized under the laws of
Switzerland.
"Fundamental Transaction" means any of the following:
(a) an acquisition, merger, reorganization or consolidation or
similar transaction (a "Reorganization Transaction") with any person other than
Investor or its Affiliates in which the consideration is stock and the
stockholders of Company immediately prior to such Reorganization Transaction
will not own at least 75% of the entity surviving such Reorganization
Transaction;
25
(b) the sale of all or substantially all of the assets of Company
unless the stockholders of Company immediately after such sale own at least 75%
of the entity acquiring such assets; or
(c) any investment in Company by any Strategic Investor other than
an Affiliate of Investor, such investment to be evidenced by the issuance of any
voting equity interest in Company or any other securities convertible into a
voting equity interest in Company.
"Governing Documents" means with respect to any particular entity, (a) if
a corporation, the articles or certificate of incorporation and the bylaws; (b)
if a general partnership, the partnership agreement and any statement of
partnership; (c) if a limited partnership, the limited partnership agreement and
the certificate of limited partnership; (d) if a limited liability company, the
articles of organization and operating agreement; (e) if another type of Person,
any other charter or similar document adopted or filed in connection with the
creation, formation or organization of a Person; (f) all equityholders'
agreements, voting agreements, voting trust agreements, joint venture
agreements, registration rights agreements or other agreements or documents
relating to the organization, management or operation of any Person, or relating
to the rights, duties and obligations of the security holders of any Person; and
(g) any amendment or supplement to any of the foregoing.
"Governmental Body" means any:
(a) nation, state, county, city, town, borough, village, district,
or other jurisdiction;
(b) federal, state, local, municipal, foreign, or other government;
(c) governmental or quasi-governmental authority of any nature
(including any agency, branch, department, board, commission, court, tribunal or
other entity exercising governmental or quasi-governmental powers);
(d) multi-national organization or body;
(e) body exercising, or entitled or purporting to exercise, any
administrative, executive, judicial, legislative, police, regulatory, or taxing
authority or power; and
(f) official of any of the foregoing.
"Investment Agreement" is defined in the Recitals.
"Investor" is defined in the introductory paragraph.
"Investor Manager Nominee" is defined in Section 8.3.
"Investor's Board Nominees" is defined in Section 8.1(a).
"Investor Shares" means any and all Common Stock now or hereafter acquired
by Investor or any Affiliates of Investor.
26
"Legal Requirement" means any applicable federal, state, local, municipal,
foreign, international, multinational, or other constitution, law, ordinance,
principle of common law, code, regulation, statute, or treaty.
"1996 Stock Option/Stock Issuance Plan" is defined in Article 3.3(b).
"Notice" is defined in Article 4.
"Offer" is defined in Article 4.
"Order" means any order, injunction, judgment, decree, ruling, assessment
or arbitration award of any Governmental Body or arbitrator.
"Person" means an individual, partnership, corporation, business trust,
limited liability company, limited liability partnership, joint stock company,
trust, unincorporated association, joint venture or other entity, or a
Governmental Body.
"Reasonable Commercial Efforts" means the efforts that a reasonably
prudent business Person desirous of achieving a result would use in similar
circumstances to achieve that result.
"Reorganization Transaction" is defined in the definition of Fundamental
Transaction.
"Representative" means, with respect to a particular Person, any director,
officer, employee, agent, consultant, advisor, or other representative of such
Person, including legal counsel, accountants, and financial advisors.
"Required Action" means, with respect to a particular action, that a party
will use its Reasonable Commercial Efforts to persuade other directors on the
Board to, and, as necessary, vote all Common Stock and use its Reasonable
Commercial Efforts to cause all other stockholders and directors of Company to
vote their Common Stock to, effect that action.
"SAirGroup Affiliate" means any Affiliate of SAirGroup which signs as
counterparty to this Agreement and the Investment Agreement, and of which
SAirGroup owns at least a majority of the equity interests and has management
control.
"Second Closing" has the meaning specified in the Investment Agreement.
"Securities Act" means the Securities Act of 1933, together with any
amendments thereto and rules and regulations thereunder.
"SRT" means SR Technics Group, a company organized under the laws of
Switzerland.
"SRT Group America" means SR Technics Group America, Inc., a Delaware
corporation.
"Steering Committee" is defined in Section 8.1.
27
"Strategic Investor" means a commercial aircraft engine manufacturer, a
maintenance repair overhaul company, or a major U.S. or foreign airline.
"Target Shares" is defined in Article 4.
28
Exhibit 3.2(a)
Consent of Spouse
I, Ms. Xxxxx Xxxxxx, a California resident, having received such
independent advice as I consider prudent:
(a) confirm that Xxxxxxx X. Xxxxxx, XX, is my husband;
(b) affirms that I am aware of, understand and fully consent and
agree to, the provisions of the Stockholders' Agreement ("Agreement") by and
among Xxxxxx Lease Finance Corporation, a Delaware corporation, Xxxxxxx X.
Xxxxxx, a California resident, CFW Partners, L.P., a California limited
partnership, the Xxxxxx Xxxxxxxx Xxxxxx 1995 Irrevocable Trust, a trust governed
by the laws of the State of California, and FlightTechnics, LLC, a Delaware
limited liability company and its binding effect on any community property or
other interests I now and may hereafter own;
(c) agree that the termination of my marital relationship with
Xxxxxxx X. Xxxxxx, XX, for any reason will not have the effect of removing any
CFW Shares (as defined in the Agreement) from the coverage of the Agreement;
(d) authorize, ratify and consent to the execution of the Agreement
by Xxxxxxx X. Xxxxxx, XX; and
(e) agree to the performance of all obligations by Xxxxxxx X.
Xxxxxx, XX, under the Agreement, and agree to be bound by the obligations that
apply to Xxxxxxx X. Xxxxxx, XX, as if I were a party to the Agreement.
/s/ XXXXX XXXXXX
----------------------------------------
Xxxxx Xxxxxx
Date: November 7, 2000
