Exhibit 4.5
EXECUTION
VERSION
AAR CORP.
1.625 % Convertible Senior Notes due 20
14
Registration Rights
Agreement
February 11 , 2008
MERRILL
LYNCH & CO.
Merrill Lynch, Pierce,
Fenner & Smith
Incorporated
as Representative of
the several Purchasers
4 World Financial
Center
New York, New
York 10080
Ladies and
Gentlemen:
AAR CORP., a Delaware
corporation (the “Company”), proposes to issue and sell
to the Purchasers (as defined herein) upon the terms set forth in
the Purchase Agreement (as defined herein) its 1.625 % Convertible Senior Notes due 2014 (the
“Securities”). As an inducement to the Purchasers
to enter into the Purchase Agreement and in satisfaction of a
condition to the obligations of the Purchasers thereunder, the
Company agrees with the Purchasers for the benefit of Holders (as
defined herein) from time to time of the Registrable Securities (as
defined herein) as follows:
1.
Definitions.
(a)
Capitalized terms used herein without definition shall have the
meanings ascribed to them in the Purchase Agreement. As used
in this Agreement, the following defined terms shall have the
following meanings:
“Affiliate” of any specified person
means any other person which, directly or indirectly, is in control
of, is controlled by, or is under common control with such
specified person. For purposes of this definition, control of
a person means the power, direct or indirect, to direct or cause
the direction of the management and policies of such person whether
by contract or otherwise; and the terms “controlling”
and “controlled” have meanings correlative to the
foregoing.
“Closing
Date” means the Initial Closing Time as defined in the
Purchase Agreement.
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“Commission” means the United
States Securities and Exchange Commission, or any other federal
agency at the time administering the Exchange Act or the Securities
Act, whichever is the relevant statute for the particular
purpose.
“Common
Stock” means the Company’s common stock, par value
$1.00 per share, together with any associated share purchase
rights.
“DTC”
means The Depository Trust Company.
“Effectiveness Period” has the
meaning assigned thereto in
Section 2(b)(i) hereof.
“Effective
Time” means the time at which the Commission declares the
Shelf Registration Statement effective or at which the Shelf
Registration Statement otherwise becomes effective.
“Electing
Holder” has the meaning assigned thereto in
Section 3(a)(iii) hereof.
“Exchange
Act” means the United States Securities Exchange Act of 1934,
as amended.
“FINRA
Rules” means the Rules of the Financial Industry
Regulatory Authority, as amended from time to time.
“Holder” means any person that is
the record owner of Registrable Securities (and includes any person
that has a beneficial interest in any Registrable Security in
book-entry form).
“Indenture” means the Indenture,
dated as of February 11 , 2008, between the Company and U.S. Bank
National Association, as trustee, as amended and supplemented from
time to time in accordance with its terms.
“Issuer Free
Writing Prospectus” has the meaning assigned thereto in
Section 2(d) hereof.
“Liquidated
Damages” has the meaning assigned thereto in
Section 7(a) hereof.
“Managing
Underwriters” means the investment banker or investment
bankers and manager or managers that shall administer an
underwritten offering, if any, conducted pursuant to Section 6
hereof.
“Notice and
Questionnaire” means a Notice of Registration Statement and
Selling Securityholder Questionnaire substantially in the form of
Appendix A hereto.
The term
“person” means an individual, partnership, corporation,
limited liability company, trust or unincorporated organization, or
a government or agency or political subdivision thereof.
“Prospectus” means the prospectus
(including, without limitation, any preliminary prospectus, any
final prospectus and any prospectus that discloses information
previously omitted from a prospectus filed as part of an effective
registration statement in reliance upon Rule 430B under the
Securities Act) included in the Shelf Registration Statement, as
amended or
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supplemented by
any prospectus supplement with respect to the terms of the offering
of any portion of the Registrable Securities covered by the Shelf
Registration Statement and by all other amendments and supplements
to such prospectus, including all material incorporated by
reference in such prospectus and all documents filed after the date
of such prospectus by the Company under the Exchange Act and
incorporated by reference therein. Any information included
in the Prospectus that was omitted from the Shelf Registration
Statement at the time it became effective but that is deemed to be
part of and included in the Shelf Registration Statement pursuant
to Rule 430B(f) is referred to as the
“Rule 430B Information.”
“Purchase
Agreement” means the purchase agreement, dated as of
February 5 , 2008, between the Purchasers and the Company
relating to the Securities.
“Purchasers” means the Purchasers
named in Schedule A to the Purchase Agreement.
“Registrable
Securities” means all or any portion of the Securities issued
from time to time under the Indenture in registered form and the
shares of Common Stock issuable upon conversion of such Securities;
provided, however, that a Security or a share of Common Stock
ceases to be a Registrable Security when it is no longer a
Restricted Security.
“Registration Default” has the
meaning assigned thereto in
Section 7(a) hereof.
“Restricted
Securities” means any Securities or shares of Common Stock
issuable upon conversion thereof except any such Securities or
shares of Common Stock where (i) a Shelf Registration
Statement with respect to such Securities or shares of Common Stock
shall have become effective under the Securities Act and such
Securities or shares of Common Stock shall have been disposed of
pursuant to such Shelf Registration Statement, (ii) such
Securities or shares of Common Stock shall have been sold to the
public pursuant to Rule l44 (or any similar provision then in
force, but not Rule 144A) under the Securities Act
, (iii) one year has
passed since the issue date of the Securities or (iv) such
Securities or shares of Common Stock shall have ceased to be
outstanding.
“Rules and Regulations” means
the published rules and regulations of the Commission
promulgated under the Securities Act or the Exchange Act, as in
effect at any relevant time.
“Securities
Act” means the United States Securities Act of 1933, as
amended.
“Shelf
Registration” means a registration effected pursuant to
Section 2 hereof.
“Shelf
Registration Statement” means a “shelf”
registration statement filed under the Securities Act providing for
the registration of, and the sale on a continuous or delayed basis
by the Holders of, all of the Registrable Securities pursuant to
Rule 415 under the Securities Act and/or any similar
rule that may be adopted by the Commission, filed by the
Company pursuant to the provisions of Section 2 of this
Agreement, including the Prospectus contained therein, any
amendments and supplements to such registration statement,
including post-effective amendments, and all exhibits and all
material incorporated by reference in such registration
statement.
“Suspension
Period” has the meaning assigned thereto in
Section 2(c) hereof.
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“Trust
Indenture Act” means the Trust Indenture Act of 1939, or any
successor thereto, and the rules, regulations and forms promulgated
thereunder, as the same shall be amended from time to
time.
“Underwritten Offering” means a
registration in which Registrable Securities are sold to one or
more underwriters for reoffering to the public.
The term
“underwriter” means any underwriter of Registrable
Securities in connection with an offering thereof under a Shelf
Registration Statement.
(b)
Wherever there is a reference in this Agreement to a percentage of
the “principal amount” of Registrable Securities or to
a percentage of Registrable Securities, shares of Common Stock
shall be treated as representing the principal amount of Securities
that was surrendered for conversion or exchange in order to receive
such number of shares of Common Stock.
2.
Shelf
Registration.
(a)
Subject to Section 2(e) of this Agreement, the Company
shall, no later than six months of the Closing Date, file with the
Commission a Shelf Registration Statement or designate an existing
Shelf Registration Statement filed with the Commission relating to
the offer and sale of the Registrable Securities by the Holders
from time to time in accordance with the methods of distribution
elected by such Holders and set forth in such Shelf Registration
Statement and, thereafter, shall use its reasonable best efforts to
cause such Shelf Registration Statement to be declared or otherwise
become effective under the Securities Act no later than six months
of the Closing Date; provided, however, that the Company may, upon
written notice to all Holders, postpone having the Shelf
Registration Statement become effective for a reasonable period not
to exceed 90 days if the Company possesses material non-public
information, the disclosure of which would have a material adverse
effect on the Company and its subsidiaries taken as a whole, if a
pending transaction that would be material to the Company and its
subsidiaries, taken as a whole, could be materially adversely
affected as a result, or if the Company is unable to file financial
statements required to be included in a shelf registration
statement as a result of a pending litigation; provided, further,
however, that no Holder shall be entitled to be named as a selling
securityholder in the Shelf Registration Statement or to use the
Prospectus forming a part thereof for resales of Registrable
Securities unless such Holder is an Electing Holder.
(b)
Subject to Section 2(e) of this Agreement, the Company
shall use its reasonable best efforts:
(i)
to keep the Shelf Registration Statement continuously effective
under the Securities Act in order to permit the Prospectus forming
a part thereof to be usable by Holders until the earlier of
(1) the date on which all of the Securities and the shares of
Common Stock issued and issuable upon conversion thereof have been
sold pursuant to the Shelf Registration Statement, (2) the
date on which all of the outstanding Securities and shares of
Common Stock issued and issuable upon conversion thereof and held
by Holders who are not Affiliates of the Company may be freely
transferred immediately
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pursuant to the second sentence of
Rule 144(b)(1)(i) (as such rule shall become
effective on February 15, 2008) or any successor
rule thereto ,
(3) one year after the issue date of the Securities and
(4) the date on which there are no outstanding Registrable
Securities (such period being referred to herein as the
“Effectiveness Period”) .
(ii)
after the Effective Time of the Shelf Registration Statement,
promptly upon the request of any Holder of Registrable Securities
that is not then an Electing Holder, to take any action reasonably
necessary to enable such Holder to use the Prospectus forming a
part thereof for resales of Registrable Securities, including,
without limitation, any action necessary to identify such Holder as
a selling securityholder in the Shelf Registration Statement;
provided, however, that nothing in this subparagraph shall relieve
such Holder of the obligation to return a completed and signed
Notice and Questionnaire to the Company in accordance with
Section 3(a)(ii) hereof; and
(iii)
if at any time the Securities, pursuant to Article 4.2 of the
Indenture, are convertible into securities other than Common Stock,
to cause, or to cause any successor under the Indenture to cause,
such securities to be included in the Shelf Registration Statement
no later than the date on which the Securities may then be
convertible into such securities.
The Company shall
be deemed not to have used its reasonable best efforts to keep the
Shelf Registration Statement effective during the requisite period
if the Company voluntarily takes any action that would result in
Holders of Registrable Securities covered thereby not being able to
offer and sell any of such Registrable Securities during that
period, unless such action is (A) required by applicable law
and the Company thereafter promptly complies with the requirements
of paragraph 3(j) below or (B) permitted pursuant to
Section 2(c) below.
(c)
The Company may suspend the use of the Prospectus for a period not
to exceed 30 days in any 90-day period or an aggregate of 90 days
in any 12-month period (each, a “Suspension Period”) if
the Board of Directors of the Company shall have determined in good
faith that because of valid business reasons (not including
avoidance of the Company’s obligations hereunder), including
the acquisition or divestiture of assets, pending corporate
developments, public filings with the Commission and similar
events, it is in the best interests of the Company to suspend such
use, and prior to suspending such use the Company provides the
Holders with written notice of such suspension, which notice need
not specify the nature of the event giving rise to such
suspension.
(d)
The Company represents and agrees that, unless it obtains the prior
consent of the Holders of a majority of the Registrable Securities
that are registered under the Shelf Registration Statement at such
time or the consent of the Managing Underwriter in connection with
any underwritten offering of Registrable Securities, it will not
make any offer relating to the Securities that would constitute an
“issuer free writing prospectus,” as defined in
Rule 433 (an “Issuer Free Writing Prospectus”), or
that would otherwise constitute a “free writing
prospectus,” as defined in Rule 405, required to be
filed with the Commission. Each Holder represents and agrees
that, unless it obtains the prior consent of the Company and any
such Managing Underwriter, it will not make any offer relating to
the Securities that would constitute a “free writing
prospectus,” as defined in Rule 405, required to be
filed with the
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Commission. The Company represents that
any Issuer Free Writing Prospectus or a “free writing
prospectus”will not include any information that conflicts
with the information contained in the Shelf Registration Statement
or the Prospectus and, any Issuer Free Writing Prospectus or a
“free writing prospectus”, when taken together with the
information in the Shelf Registration Statement and the Prospectus,
will not include any untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made,
not misleading.
(e)
The Company’s obligations pursuant to Sections 2 and 3 of
this Agreement shall be suspended during any period in which
Holders that are not Affiliates of the Company (and have not been
Affiliates of the Company during the preceding three months)
(i) do not hold any Registrable Securities or (ii) may
freely transfer their Registrable Securities immediately pursuant
to Rule 144 (or any similar provision then in force) under the
Securities Act, including Rule 144(b)(1)(i) (as such
rule shall become effective on February 15,
2008).
3.
Registration Procedures . In connection with the Shelf
Registration Statement, the following provisions shall apply
subject to Section 2(e) of this Agreement:
(a)
Not less than 30 calendar days prior to the Effective Time of the
Shelf Registration Statement, the Company shall mail the Notice and
Questionnaire to the Holders of Registrable Securities. No
Holder shall be entitled to be named as a selling securityholder in
the Shelf Registration Statement as of the Effective Time, and no
Holder shall be entitled to use the Prospectus forming a part
thereof for resales of Registrable Securities until such Holder has
returned a completed and signed Notice and Questionnaire to the
Company; provided, however, to be included in the Registration
Statement as of the Effective Time, Holders of Registrable
Securities shall have at least 28 calendar days from the date on
which the Notice and Questionnaire is first mailed to such Holders
to return a completed and signed Notice and Questionnaire to the
Company.
(i)
After the Effective Time of the Shelf Registration Statement, the
Company shall, upon the request of any Holder of Registrable
Securities that is not then an Electing Holder, promptly send a
Notice and Questionnaire to such Holder. From and after the
Effective Time of the Shelf Registration Statement, the Company
shall (A) use reasonable best efforts, within 15 Business Days
after receipt, to prepare and file with the Commission (x) any
Exchange Act report, (y) a supplement to the Prospectus or, if
required by applicable law, a post-effective amendment to the Shelf
Registration Statement and (z) any other document required by
applicable law, so that the Holder delivering such Notice and
Questionnaire is named as a selling securityholder in the Shelf
Registration Statement and is permitted to deliver the Prospectus
to purchasers of such Holder’s Registrable Securities in
accordance with applicable law, and (B) if the Company shall
file a post-effective amendment to the Shelf Registration
Statement, use its reasonable best efforts to cause such
post-effective amendment to become effective under the Securities
Act as promptly as is practicable; provided, however, that if a
Notice and Questionnaire is delivered to the Company during a
Suspension Period, the Company shall not be obligated to take the
actions set forth in this clause (ii) until the termination of
such Suspension Period; provided further, the Company shall not be
obligated to file more than one post-effective amendment in any
90-day period. Notwithstanding the
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foregoing, if the Registrable Securities are
converted as provided under the Indenture, the Company shall use
its reasonable best efforts to file the Exchange Act filing,
prospectus supplement, post-effective amendment or other document
within 10 Business Days of the end of the Conversion Reference
Period, as defined in the Indenture; provided, however, that the
Company shall not be obligated to take the actions set forth in
this sentence during a Suspension Period.
(ii)
The term “Electing Holder” shall mean any Holder of
Registrable Securities that has returned a completed and signed
Notice and Questionnaire to the Company in accordance with
Section 3(a)(i) or 3(a)(ii) hereof.
(b)
The Company shall furnish to each Electing Holder, prior to the
Effective Time, a copy of the Shelf Registration Statement
initially filed with the Commission, and shall furnish to such
Holders, prior to the filing thereof with the Commission, copies of
each amendment thereto and each amendment or supplement, if any, to
the Prospectus included therein, and shall use its reasonable best
efforts to reflect in each such document, at the Effective Time or
when so filed with the Commission, as the case may be, such
comments as such Holders and their respective counsel reasonably
may propose.
(c)
The Company shall promptly take such action as may be necessary so
that (i) each of the Shelf Registration Statement and any
amendment thereto and the Prospectus forming a part thereof and any
amendment or supplement thereto (and each report or other document
incorporated therein by reference in each case) complies in all
material respects with the Securities Act and the Exchange Act and
the respective rules and regulations thereunder,
(ii) each of the Shelf Registration Statement and any
amendment thereto does not, when it becomes effective, including
any Rule 430B Information, contain an untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary to make the statements therein not
misleading and (iii) each of the Prospectus forming a part of
the Shelf Registration Statement, and any amendment or supplement
to such Prospectus, does not at any time during the Effectiveness
Period include an untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were
made, not misleading.
(d)
The Company shall promptly advise each Electing Holder, and shall
confirm such advice in writing if so requested by any such Electing
Holder:
(i)
when a Shelf Registration Statement and any amendment thereto has
been filed with the Commission and when a Shelf Registration
Statement or any post-effective amendment thereto has become
effective, in each case making a public announcement thereof by
release made to Reuters Economic Services and Bloomberg Business
News;
(ii)
of any request by the Commission for amendments or supplements to
the Shelf Registration Statement or the Prospectus included therein
or for additional information;
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(iii)
of the issuance by the Commission of any stop order suspending the
effectiveness of the Shelf Registration Statement or the initiation
of any proceedings for such purpose;
(iv)
of the receipt by the Company of any notification with respect to
the suspension of the qualification of the securities included in
the Shelf Registration Statement for sale in any jurisdiction or
the initiation of any proceeding for such purpose; and
(v)
of the occurrence of any event or the existence of any state of
facts that requires the making of any changes in the Shelf
Registration Statement or the Prospectus included therein so that,
as of such date, such Shelf Registration Statement and Prospectus
do not contain an untrue statement of a material fact and do not
omit to state a material fact required to be stated therein or
necessary to make the statements therein (in the case of the
Prospectus, in light of the circumstances under which they were
made) not misleading (which advice shall be accompanied by an
instruction to such Holders to suspend the use of the Prospectus
until the requisite changes have been made).
(e)
The Company shall use its reasonable best efforts to prevent the
issuance, and if issued to obtain the withdrawal at the earliest
possible time, of any order suspending the effectiveness of the
Shelf Registration Statement.
(f)
The Company shall furnish to each Electing Holder, without charge,
at least one copy of the Shelf Registration Statement and all
post-effective amendments thereto, including financial statements
and schedules, and, if such Electing Holder so requests in writing,
all reports, other documents and exhibits that are filed with or
incorporated by reference in the Shelf Registration
Statement.
(g)
The Company shall, during the Effectiveness Period, deliver to each
Electing Holder, without charge, as many copies of the Prospectus
(including each preliminary prospectus) included in the Shelf
Registration Statement and any amendment or supplement thereto as
such Electing Holder may reasonably request; and the Company
consents (except during a Suspension Period or during the
continuance of any event or the existence of any state of facts
described in Section 3(d)(v) above) to the use of the
Prospectus and any amendment or supplement thereto by each of the
Electing Holders in connection with the offering and sale of the
Registrable Securities covered by the Prospectus and any amendment
or supplement thereto during the Effectiveness Period.
(h)
Prior to any offering of Registrable Securities pursuant to the
Shelf Registration Statement, the Company shall (i) register
or qualify or cooperate with the Electing Holders and their
respective counsel in connection with the registration or
qualification of such Registrable Securities for offer and sale
under the securities or “blue sky” laws of such
jurisdictions within the United States as any Electing Holder may
reasonably request, (ii) keep such registrations or
qualifications in effect and comply with such laws so as to permit
the continuance of offers and sales in such jurisdictions for so
long as may be necessary to enable any Electing Holder or
underwriter, if any, to complete its distribution of Registrable
Securities pursuant to the Shelf Registration Statement, and
(iii) take any and all other actions necessary or
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advisable to
enable the disposition in such jurisdictions of such Registrable
Securities; provided, however, that in no event shall the Company
be obligated to (A) qualify as a foreign corporation or as a
dealer in securities in any jurisdiction where it would not
otherwise be required to so qualify but for this
Section 3(h) or (B) file any general consent to
service of process in any jurisdiction where it is not as of the
date hereof so subject.
(i)
Unless any Registrable Securities shall be in book-entry only form,
the Company shall cooperate with the Electing Holders to facilitate
the timely preparation and delivery of certificates representing
Registrable Securities to be sold pursuant to the Shelf
Registration Statement, which certificates, if so required by any
securities exchange upon which any Registrable Securities are
listed, shall be penned, lithographed or engraved, or produced by
any combination of such methods, on steel engraved borders, and
which certificates shall be free of any restrictive legends and in
such permitted denominations and registered in such names as
Electing Holders may request in connection with the sale of
Registrable Securities pursuant to the Shelf Registration
Statement.
(j)
Upon the occurrence of any event or the existence of any state of
facts contemplated by paragraph 3(d)(v) above, the Company
shall promptly prepare a post-effective amendment to any Shelf
Registration Statement or an amendment or supplement to the related
Prospectus or file any other required document so that, as
thereafter delivered to purchasers of the Registrable Securities
included therein, the Prospectus will not include an untrue
statement of a material fact or omit to state any material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading. If
the Company notifies the Electing Holders of the occurrence of any
event or the existence of any state of facts contemplated by
paragraph 3(d)(v) above, the Electing Holders shall suspend
the use of the Prospectus until the requisite changes to the
Prospectus have been made.
(k)
Not later than the Effective Time of the Shelf Registration
Statement, the Company shall provide a CUSIP number for the
Registrable Securities that are debt securities.
(l)
The Company shall use its reasonable best efforts to comply with
all applicable Rules and Regulations, and to make generally
available to its securityholders as soon as practicable, but in any
event not later than eighteen months after (i) the effective
date (as defined in Rule 158(c) under the Securities Act)
of the Shelf Registration Statement, (ii) the effective date
of each post-effective amendment to the Shelf Registration
Statement, and (iii) the date of each filing by the Company
with the Commission of an Annual Report on Form 10-K that is
incorporated by reference in the Shelf Registration Statement, an
earning statement of the Company and its subsidiaries complying
with Section 11(a) of the Securities Act and the
applicable Rules and Regulations (including, at the option of
the Company, Rule 158).
(m)
Not later than the Effective Time of the Shelf Registration
Statement, the Company shall cause the Indenture to be qualified
under the Trust Indenture Act; in connection with such
qualification, the Company shall cooperate with the Trustee under
the Indenture and the Holders (as defined in the Indenture) to
effect such changes to the Indenture as may be required for such
Indenture to be so qualified in accordance with the terms of the
Trust Indenture Act; and the Company shall execute, and shall use
all reasonable efforts to cause the Trustee to execute, all
documents that may be required to effect such changes and all other
forms and
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documents
required to be filed with the Commission to enable such Indenture
to be so qualified in a timely manner. In the event that any
such amendment or modification referred to in this
Section 3(m) involves the appointment of a new trustee
under the Indenture, the Company shall appoint a new trustee
thereunder pursuant to the applicable provisions of the
Indenture.
(n)
In the event of an underwritten offering conducted pursuant to
Section 6 hereof, the Company shall, if requested, promptly
include or incorporate in a prospectus supplement or post-effective
amendment to the Shelf Registration Statement such information as
the Managing Underwriters reasonably agree should be included
therein and to which the Company does not reasonably object and
shall make all required filings of such prospectus supplement or
post-effective amendment as soon as practicable after it is
notified of the matters to be included or incorporated in such
prospectus supplement or post-effective amendment.
(o)
The Company shall enter into such customary agreements (including
an underwriting agreement in customary form in the event of an
underwritten offering conducted pursuant to Section 6 hereof)
and take all other appropriate action in order to expedite and
facilitate the registration and disposition of the Registrable
Securities, and in connection therewith, if an underwriting
agreement is entered into, cause the same to contain
indemnification provisions and procedures substantially identical
to those set forth in Section 5 hereof with respect to all
parties to be indemnified pursuant to Section 5
hereof.
(p)
The Company shall:
(i)
(A) make reasonably available for inspection by the Electing
Holders, any underwriter participating in any disposition pursuant
to the Shelf Registration Statement, and any attorney, accountant
or other agent retained by such Electing Holders or any such
underwriter all relevant financial and other records, pertinent
corporate documents and properties of the Company and its
subsidiaries, and (B) cause the Company’s officers,
directors and employees to supply all information reasonably
requested by such Electing Holders or any such underwriter,
attorney, accountant or agent in connection with the Shelf
Registration Statement, in each case, as is customary for similar
due diligence examinations; provided, however, that all records,
information and documents that are designated in writing by the
Company, in good faith, as confidential shall be kept confidential
by such Electing Holders and any such underwriter, attorney,
accountant or agent, unless such disclosure is made in connection
with a court proceeding or required by law, or such records,
information or documents become available to the public generally
or through a third party without an accompanying obligation
of
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