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EXHIBIT 10.1
VISTEON CORPORATION
WARRANT FOR THE PURCHASE OF SHARES OF
COMMON STOCK OF VISTEON CORPORATION
NO. 1
WARRANT TO PURCHASE
25,000,000 SHARES
THIS SECURITY
HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED, OR ANY
STATE SECURITIES LAWS AND MAY NOT BE OFFERED OR SOLD OR
OTHERWISE
TRANSFERRED EXCEPT IN COMPLIANCE THEREWITH. THIS SECURITY IS
ALSO
SUBJECT TO
RESTRICTIONS ON TRANSFER AS SET FORTH HEREIN AND IN THE
STOCKHOLDER
AGREEMENT (AS HEREIN DEFINED), COPIES OF WHICH MAY BE OBTAINED
UPON REQUEST
FROM THE COMPANY.
FOR VALUE
RECEIVED, VISTEON CORPORATION, a Delaware corporation (the
"COMPANY"), hereby certifies that FORD
MOTOR COMPANY, a Delaware Corporation
("FORD" and together with its successors
and permitted assigns, the "HOLDER"),
is entitled, subject to the provisions of
this Warrant and the Stockholder
Agreement (as hereinafter defined), to
purchase from the Company, at the times
specified herein, twenty-five million fully
paid and non-assessable shares of
Common Stock of the Company, par value
$1.00 per share (the "COMMON STOCK"), at
a purchase price per share equal to the
Exercise Price (as hereinafter defined).
The number of shares of Common Stock to be
received upon the exercise of this
Warrant and the price to be paid for a
share of Common Stock are subject to
adjustment from time to time as hereinafter
set forth.
1. Definitions.
(a) The following terms, as used herein, have the following
meanings:
"AFFILIATE"
means, with respect to any Person, any other Person directly or
indirectly controlling, controlled by, or
under common control with such other
Person. For the purpose of this definition,
the term "control" (including, with
correlative meanings, the terms
"controlling", "controlled by" and "under common
control with"), as used with respect to any
Person, means having the right to
elect a majority of the board of directors
or other comparable body responsible
for management and direction of a Person,
or otherwise having, directly or
indirectly, the power to direct or cause
the direction of the management and
policies of such Person, by contract or by
virtue of share ownership.
"AGGREGATE
EXERCISE PRICE" shall have the meaning set forth in paragraph
9(a)(ii).
"BOARD OF
DIRECTORS" means the Board of Directors of the Company.
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"BUSINESS DAY"
means a day, other than Saturday, Sunday or other day on
which commercial banks in Detroit, Michigan
are authorized or required by law to
close.
"CHANGE OF
CONTROL" means (i) a liquidation or dissolution of the Company;
(ii) the sale, lease, transfer, conveyance
or other disposition, in one or a
series of related transactions, of all or
substantially all of the assets of the
Company and its Subsidiaries, taken as a
whole; (iii) a merger, consolidation,
share exchange, business combination or
similar extraordinary transaction as a
result of which the persons possessing,
immediately prior to the consummation of
such transaction, beneficial ownership of
the voting securities of the Company
entitled to vote generally in elections of
directors of the Company, cease to
possess, immediately after consummation of
such transaction, beneficial
ownership of voting securities entitling
them to exercise at least 50% of the
total voting power of all outstanding
securities entitled to vote generally in
elections of directors of the Company (or,
if not the Company, the surviving
entity resulting from such transaction, or
its parent); or (iv) a transaction or
series of transactions (including by way of
merger, consolidation, sale of stock
or otherwise) the result of which is that
any Person or "group" (as defined in
Section 13 of the 1934 Act) becomes the
"beneficial owner" (as such term is
defined in Rule 13d-3 and Rule 13d-5
promulgated under the 1934 Act), directly
or indirectly, of more than 50% of the
voting power of the outstanding voting
stock of the Company entitled to vote
generally in elections of directors of the
Company.
"CONSTITUENT
PERSON" shall have the meaning set forth in paragraph 10.
"CURRENT MARKET
PRICE PER COMMON SHARE" shall have the meaning set forth in
paragraph 6.
"DAILY PRICE"
shall have the meaning set forth in paragraph 6.
"EXCLUDED TRANSACTIONS"
shall have the meaning set forth in paragraph 9(b).
"EXERCISE PRICE"
means $6.90 per Warrant Share, as such Exercise Price may
be adjusted from time to time as provided
herein.
"EXPIRATION
DATE" means the eighth anniversary of the date of the Closing
at 5:00 p.m. Detroit, Michigan time.
"NON-ELECTING
SHARE" shall have the meaning set forth in paragraph 10.
"NYSE" means the
New York Stock Exchange.
"PERSON" means
an individual, corporation, partnership, limited liability
company, association, trust or other entity
or organization, including a
government or political subdivision or an
agency or instrumentality thereof.
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"STOCKHOLDER
AGREEMENT" means the Stockholder Agreement dated as of October
1, 2005 between the Company and Ford.
"WARRANT SHARES"
means the shares of Common Stock deliverable upon exercise
of this Warrant, as adjusted from time to
time.
(b) Capitalized terms used but not defined herein shall have
the
meanings assigned to such terms in the
Stockholder Agreement.
2. Exercise of Warrant.
(a) The Holder is entitled to exercise this Warrant in whole or
in
part at any time, or from time to time,
commencing on the earlier of (i) the
first anniversary of the date of the
Closing and (ii) the occurrence of a Change
of Control and ending on the Expiration
Date or, if any such day is not a
Business Day, then on the next succeeding
day that shall be a Business Day. To
exercise this Warrant, the Holder shall
execute and deliver to the Company a
Warrant Exercise Notice substantially in
the form annexed hereto and, if the
Holder so desires, such Warrant Exercise
Notice shall include a written request
by the Holder to exercise this Warrant on a
cashless basis pursuant to paragraph
2(e). Promptly, and in any event within
five (5) days, after delivery of the
Warrant Exercise Notice, the Company shall
notify the Holder in writing (x)
whether it will settle such exercise in
cash pursuant to paragraph 2(d)(ii) or
(y) if a request for cashless exercise has
been made by the Holder, whether it
will permit the Holder to exercise on a
cashless basis pursuant to paragraph
2(e). Subject to paragraph 2(e) below,
within ten (10) days after delivery of
the Warrant Exercise Notice, the Holder
shall deliver to the Company this
Warrant Certificate, including the Warrant
Exercise Subscription Form forming a
part hereof duly executed by the Holder,
together with payment of the applicable
Exercise Price (unless the Company shall
have elected to settle in cash pursuant
to paragraph 2(d)(ii), in which case the
applicable Exercise Price shall be
netted against the cash settlement amount
payable by the Company pursuant to
paragraph 2(d)(ii)). At the close of
business on the date of such delivery and
payment, the Holder shall be deemed to be
the holder of record of the Warrant
Shares subject to such exercise,
notwithstanding that the stock transfer books
of the Company shall then be closed or that
certificates representing such
Warrant Shares shall not then be actually
delivered to the Holder.
(b) The Exercise Price shall be paid by wire transfer of
immediately
available funds to a bank account
designated by the Company. Any documentary,
stamp or similar issue or transfer taxes
payable in respect of the issue or
delivery of the Warrant Shares shall be
borne by the party or parties having
responsibility therefor under applicable
law, provided that the Company shall
not be required to pay any tax which may be
payable in respect of any transfer
involved in the issuance and delivery of
the Warrant Shares in a name other than
that of the then Holder of this Warrant;
provided further that the parties shall
take reasonable steps to minimize such
taxes.
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(c) If the Holder exercises this Warrant in part, this Warrant
Certificate shall be surrendered by the
Holder to the Company and a new Warrant
Certificate of the same tenor and for the
unexercised number of Warrant Shares
shall be executed by the Company as
promptly as reasonably practicable. The
Company shall register the new Warrant
Certificate in the name of the Holder or
in such name or names of its transferee
pursuant to paragraph 7 hereof as may be
directed in writing by the Holder and
deliver the new Warrant Certificate to the
Person or Persons entitled to receive the
same as promptly as reasonably
practicable.
(d) Upon surrender of this Warrant Certificate in conformity with
the
foregoing provisions, the Company shall, as
promptly as reasonably practicable,
either (i) transfer to the Holder of this
Warrant Certificate appropriate
evidence of ownership of the shares of
Common Stock or other securities or
property (including any money) to which the
Holder is entitled, registered or
otherwise placed in, or payable to the
order of, the name or names of the Holder
or such transferee as may be directed in
writing by the Holder, and shall, as
promptly as reasonably practicable, deliver
such evidence of ownership and any
other securities or property (including any
money) to the Person or Persons
entitled to receive the same or (ii) if the
Company has elected pursuant to
paragraph 2(a) to cash settle, pay an
amount in cash equal to (x) such number of
shares of Common Stock to which the Holder
is entitled times the Current Market
Price on the Business Day immediately
preceding the date on which the Holder
delivered the Warrant Exercise Notice
pursuant to paragraph 2(a) minus (y) the
applicable Exercise Price, if any, that
would have otherwise been payable by the
Holder, in each case of clauses (i) or (ii)
together with an amount in cash in
lieu of any fraction of a share as provided
in paragraph 6 below, such amounts
to be paid in cash or by wire transfer of
immediately available funds to a bank
account designated by the Holder or by
certified or official bank check or bank
cashier's check payable to the order of
such Holder or by any combination of
such cash, wire transfer or check.
(e) If, pursuant to paragraph 2(a) the Company permits a
cashless
exercise by the Holder, in lieu of making
the payment required to exercise the
Warrant pursuant to paragraph 2(a) (but in
all other respects in accordance with
the exercise procedure set forth in
paragraph 2(a)), the Holder may convert this
Warrant into shares of Common Stock, in
which event the Company will issue to
the Holder the number of shares of Common
Stock equal to the result obtained
under the following equation:
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(A - B) x C where:
X =
-----------
A
X = the number of shares of Common Stock issuable upon exercise
pursuant to this paragraph 2(e);
A = the Current Market Price Per Common Share on the Business
Day
immediately preceding the date on which the Holder delivers the
Warrant Exercise Notice pursuant to paragraph 2(a);
B = the Exercise Price; and
C = the number of shares of Common Stock as to which this Warrant
is
being exercised pursuant to paragraph 2(a).
If the foregoing
calculation results in a negative number, then no shares
of Common Stock shall be issued upon
exercise pursuant to this paragraph 2(e).
3. Beneficial
Ownership. Notwithstanding anything to the contrary in this
Warrant, in no event shall the Holder be
entitled to receive, or shall be deemed
by applicable law to receive, any Warrant
Shares if, upon the receipt of such
Warrant Shares, the "beneficial ownership"
(within the meaning of Section 13 of
the 1934 Act and the rules and regulations
promulgated thereunder) of Common
Stock by the Holder would be equal to or
greater than 9.9% of the outstanding
shares of Common Stock. If any delivery
owed to the Holder hereunder is not
made, in whole or in part, as a result of
this provision, the Company's
obligation to make such delivery shall not
be extinguished and the Company shall
make such delivery as promptly as
practicable after, but in no event later than
two Business Days after, the Holder gives
notice to the Company that such
delivery would not result in the Holder
directly or indirectly so beneficially
owning in excess of 9.9% of the outstanding
shares of Common Stock. Upon
request, the Company shall advise the
Holder of the number of shares of Common
Stock outstanding, in order to permit the
Holder to make the calculation
contemplated by this paragraph 3. The
Company shall have no responsibility to
monitor the beneficial ownership of Common
Stock by the Holder. For the
avoidance of doubt, nothing in this
paragraph 3 shall entitle the Holder to
exercise this Warrant after the Expiration
Date.
4. Restrictive
Legend. Certificates representing shares of Common Stock
issued pursuant to this Warrant shall bear
a legend substantially in the form of
the legend set forth on the first page of
this Warrant Certificate to the extent
that and for so long as such legend is
required pursuant to the Stockholder
Agreement.
5. Reservation
of Shares; NYSE Listing. The Company hereby agrees that at
all times there shall be reserved for
issuance and delivery upon exercise of
this Warrant such number of its authorized
but unissued shares of Common Stock
or other securities of the Company from
time to time issuable upon exercise of
this
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Warrant as will be sufficient to permit the
exercise in full of this Warrant.
All such shares shall be duly authorized
and, when issued upon such exercise,
shall be validly issued, fully paid and
non-assessable, free and clear of all
liens, security interests, charges and
(except as contemplated in the legend
referred to in paragraph 4) other
encumbrances or restrictions on sale and free
and clear of all preemptive rights.
If the Warrant
Shares have not been approved for listing on the NYSE as of
the date hereof, the Company shall use its
reasonable best efforts to cause the
Warrant Shares to be so approved for
listing as soon as practicable after the
date hereof.
6. Fractional
Shares. No fractional shares or scrip representing fractional
shares shall be issued upon the exercise of
this Warrant and in lieu of delivery
of any such fractional share upon any
exercise hereof, the Company shall pay to
the Holder an amount in cash equal to such
fraction multiplied by the Current
Market Price Per Common Share on the
Business Day immediately preceding the date
on which the Holder delivers the Warrant
Exercise Notice pursuant to paragraph
2(a).
"CURRENT MARKET
PRICE PER COMMON SHARE" on any date shall be the average of
the Daily Prices (as defined below) per
share of Common Stock for the twenty
(20) consecutive trading days immediately
prior to such date. "DAILY PRICE"
means (A) the last reported sale price on
such day on the NYSE Composite
Transactions Tape; or (B) if the shares of
Common Stock then are not traded on
the NYSE, the closing price (at the close
of the regular trading session) on
such day as reported by the principal
national securities exchange (or principal
trading market/quotation system) on which
the shares are listed and traded. If
on any determination date the shares of
such class of Common Stock are not
quoted by any such organization, the
Current Market Price Per Common Share shall
be the fair market value of such shares on
such determination date as determined
in good faith by the Board of
Directors.
7. Exchange,
Transfer or Assignment of Warrant. Subject to compliance with
the Stockholder Agreement, the Holder of
this Warrant shall be entitled, without
obtaining the consent of the Company to
assign and transfer this Warrant, at any
time in whole or from time to time in part,
to any Person or Persons. Subject to
the preceding sentence, upon surrender of
this Warrant to the Company, together
with the attached Warrant Assignment Form
duly executed, the Company shall, as
promptly as reasonably practicable and
without charge, execute and deliver new
Warrant Certificates in the name of the
assignee or assignees named in such
instrument of assignment and, if the
Holder's entire interest is not being
assigned, in the name of the Holder and
this Warrant Certificate shall promptly
be canceled. Each taker and holder of this
Warrant Certificate by taking or
holding the same, consents and agrees that
the registered holder hereof may be
treated by the Company and all other
persons dealing with this Warrant
Certificate as the absolute owner hereof
for any purpose and as the person
entitled to exercise
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the rights represented hereby.
8. Loss or
Destruction of Warrant. Upon receipt by the Company of evidence
satisfactory to it (in the exercise of its
reasonable discretion) of the loss,
theft, destruction or mutilation of this
Warrant Certificate, and (in the case
of loss, theft or destruction) of
reasonably satisfactory indemnification, and
upon surrender and cancellation of this
Warrant Certificate, if mutilated, the
Company shall execute and deliver a new
Warrant Certificate of like tenor and
date.
9. Anti-dilution
Provisions.
(a) (i) In case the Company shall at any time after the date
hereof
subdivide or split its outstanding shares
of Common Stock into a greater number
of shares, the Exercise Price in effect
immediately prior to such subdivision or
split shall be proportionately reduced and
the number of shares of Common Stock
purchasable under this Warrant shall be
proportionately increased. Conversely,
in case the outstanding shares of Common
Stock shall be combined or reclassified
into a smaller number of shares, the
Exercise Price in effect immediately prior
to such combination or reclassification
shall be proportionately increased and
the number of shares of Common Stock
purchasable under this Warrant shall be
proportionately decreased.
(ii) In case the Company shall at any time after the date
hereof
declare a dividend or make a distribution on Common Stock
generally,
that is payable in Common Stock, the Exercise Price in effect at
the
time of the record date for such dividend or distribution and
the
aggregate number of shares of Common Stock receivable upon exercise
of
this Warrant shall be proportionately adjusted so that the exercise
of
this Warrant in full after such time shall entitle the Holder
to
receive (for the Aggregate Exercise Price (as defined below))
the
aggregate number of shares of Common Stock which, if this Warrant
had
been exercised in full immediately prior to such time (for the
aggregate Exercise Price in effect at such time (the "AGGREGATE
EXERCISE PRICE")), such Holder would have owned upon such exercise
and
been entitled to receive by virtue of such dividend or
distribution.
If any declared dividend or distribution on Common Stock payable
in
Common Stock for which adjustments have been made pursuant to
the
immediately preceding sentence is not paid in whole or in part on
the
applicable
payment date, then, effective as of the time of the record
date for such dividend or distribution, the Exercise Price and
the
aggregate number of shares of Common Stock receivable upon exercise
of
this Warrant shall be proportionately readjusted so that the
exercise
of this Warrant in full after such time shall entitle the Holder
to
receive (for the Aggregate Exercise Price) the aggregate number
of
shares of Common Stock which, if this Warrant had been exercised
in
full immediately prior to such time (for the Aggregate Exercise
Price),
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such Holder would have owned upon such exercise and in fact
received
by virtue of such dividend or distribution.
(iii) In case the Company shall at any time after the date
hereof
issue any shares of its capital stock in a reclassification of
Common
Stock (including any such reclassification in connection with a
consolidation or merger in which the Company is the continuing
corporation), then, as a condition to such reclassification,
lawful
provisions shall be made, and duly executed documents evidencing
the
same from the Company or its successor shall be delivered to
the
Holder, so that the Holder shall have the right at any time that
this
Warrant is exercisable to purchase, at a total price equal to
that
payable upon exercise of this Warrant, the kind and amount of
capital
stock receivable in connection with such recapitalization by a
record
holder of the same number of shares of Common Stock as were
purchasable (without applying the restrictions set forth in
paragraph
3 hereof) by the Holder immediately prior to such
recapitalization.
Such adjustments under this paragraph 9(a) shall be made
successively
whenever any event listed above shall occur.
(b) Except
in the case of Excluded Transactions (as defined below), in
case the Company shall fix a record date
for the issuance of rights, options or
warrants to the holders of its Common Stock
generally, entitling such holders to
subscribe for or purchase shares of Common
Stock (or securities convertible into
shares of Common Stock) at a price per
share of Common Stock (or having a
conversion price per share of Common Stock,
if a security convertible into
shares of Common Stock) less than the
Current Market Price Per Common Share on
such record date (or if such date of
issuance is more than sixty days after the
record date, less than the Current Market
Price Per Common Share on such date of
issuance), the maximum number of shares of
Common Stock issuable upon exercise
of such rights, options or warrants (or
conversion of such convertible
securities) shall be deemed to have been
issued and outstanding as of such
record date (or if such date of issuance is
more than sixty days after the
record date, on such date of issuance) and
the Exercise Price to be in effect
after such issuance or sale shall be
determined by multiplying the Exercise
Price in effect immediately prior to such
issuance or sale by a fraction, the
numerator of which shall be the sum of (x)
the number of shares of Common Stock
outstanding immediately prior to the time
of such issuance or sale multiplied by
the Current Market Price Per Common Share
immediately prior to such issuance or
sale and (y) the aggregate consideration,
if any, to be received by the Company
upon such issuance or sale, and the
denominator of which shall be the product of
the aggregate number of shares of Common
Stock outstanding immediately after
such issuance or sale and the Current
Market Price Per Common Share immediately
prior to such issuance or sale. In case any
portion of the consideration to be
received by the Company shall be in a form
other than cash, the fair market
value of such noncash consideration shall
be utilized in the foregoing
computation. Such fair market value shall
be determined by the Board of
Directors. The Holder
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shall be notified promptly of any
consideration other than cash to be received
by the Company and furnished with a
description of the consideration and the
fair market value thereof, as determined in
good faith by the Board of
Directors. Such adjustment shall be made
successively whenever any such record
date is fixed; and in the event that such
rights, options or warrants or
securities convertible into shares of
Common Stock are not so issued or expire
unexercised, or in the event of a change in
the number of shares of Common Stock
to which the holders of such rights,
options or warrants or securities
convertible into shares of Common Stock are
entitled or the aggregate
consideration payable by the holders of
such rights, options, warrants or
convertible securities for such shares of
Common Stock prior to their receipt of
such shares of Common Stock (other than
pursuant to adjustment provisions
therein comparable to those contained in
this paragraph 9), the Exercise Price
shall again be adjusted to be the Exercise
Price which would then be in effect
if such rights, options or warrants or
securities convertible into shares of
Common Stock that were not so issued or
expired unexercised had never had their
related record date fixed, in the former
event, or the Exercise Price which
would then be in effect if such holder had
initially been entitled to such
changed number of shares of Common Stock or
required to pay such changed
consideration, in the latter event.
"EXCLUDED TRANSACTIONS" means any Common
Stock issued by the Company (i) upon
exercise or conversion of any security the
issuance of which caused an adjustment
under this paragraph 9, (ii) pursuant to
employee or director compensation plans or
arrangements and (iii) pursuant to a
stockholder rights plan adopted by the
Company.
(c) In case the Company shall fix a record date for the making of
a
distribution to holders of Common Stock in
their capacities as such (including
any such distribution made in connection
with a consolidation or merger in which
the Company is the continuing corporation)
of cash, evidences of indebtedness,
assets or other property (other than (i)
ordinary dividends payable in cash,
(ii) dividends payable in Common Stock,
(iii) distributions in connection with a
stockholder rights plan adopted by the
Company; or (iv) rights, options or
warrants or convertible securities referred
to in, and for which an adjustment
is made pursuant to, paragraph 9(b)
hereof), the Exercise Price to be in effect
after such record date shall be determined
by multiplying the Exercise Price in
effect immediately prior to such record
date by a fraction, the numerator of
which shall be the Current Market Price Per
Common Share on such record date,
less the fair market value (determined as
set forth in paragraph 9(b) hereof) of
the portion of the assets, other property
or evidence of indebtedness so to be
distributed which is applicable to one
share of Common Stock, and the
denominator of which shall be such Current
Market Price Per Common Share. Such
adjustments shall be made successively
whenever such a record date is fixed; and
in the event that such distribution is not
so made, the Exercise Price shall
again be adjusted to be the Exercise Price
which would then be in effect if such
record date had not been fixed
(d) In case at any time or from time to time the Company shall
take
any action affecting its capital stock as
such, other than an action described
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in any of the foregoing clauses (a) through
(c), which the Board of Directors of
the Company reasonably determines in good
faith will adversely affect the rights
of the Holders of the Warrants, the number
of shares of Common Stock purchasable
upon exercise of each Warrant and/or the
Exercise Price shall be adjusted in
such manner and at such time as the Board
of Directors of the Company may
reasonably and in good faith determine to
be equitable in the circumstances.
(e) The Company may, at its option, at any time during the term of
the
Warrants, reduce the then current Exercise
Price (but in no event below the par
value of a share of Common Stock) or
increase the number of shares of Common
Stock for which the Warrant may be
exercised to any amount deemed appropriate by
the Board of Directors; provided, however,
that if the Company elects to make
such adjustment, such adjustment will
remain in effect for at least a 5-day
period, after which time the Company may,
at its option, reinstate the Exercise
Price or number of shares of Common Stock
in effect prior to such adjustment, as
applicable, subject to any interim
adjustments pursuant to this paragraph 9.
(f) No adjustment in
the Exercise Price or otherwise pursuant to
paragraph 9(a) through (c) shall be
required unless such adjustment would
require an increase or decrease of at least
one percent in such price; provided
that any adjustments which by reason of
this paragraph 9(f) are not required to
be made shall be carried forward and taken
into account in any subsequent
adjustment. All calculations under this
paragraph 9 shall be made to the nearest
$0.001 or to the nearest hundredth of a
share of Common Stock, as the case may
be.
(g) In the event that, at any time as a result of the provisions
of
this paragraph 9, the holder of this
Warrant upon subsequent exercise shall
become entitled to receive any shares of
capital stock of the Company other than
Common Stock, the number of such other
shares so receivable upon exercise of
this Warrant shall thereafter be subject to
adjustment from time to time in a
manner and on terms as nearly equivalent as
practicable to the provisions
contained herein.
(h) Upon the occurrence of each adjustment or readjustment pursuant
to
this paragraph 9 or paragraph 10 below, the
Company at its expense shall
promptly compute such adjustment or
readjustment in accordance with the terms
hereof and furnish to the holder of this
Warrant a certificate setting forth
such adjustment or readjustment and showing
in detail the facts upon which such
adjustment or readjustment is based. The
Company shall, upon the written
request, at any time, of the holder,
furnish or cause to be furnished to such
holder a like certificate setting forth (i)
such adjustments and readjustments,
(ii) the Exercise Price at the time in
effect and (iii) the number of shares and
the amount, if any, of other property that
at the time would be received upon
exercise of the Warrant.
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(i) The Company will not, by any voluntary action, avoid or seek
to
avoid the observance or performance of any
of the terms to be observed or
performed hereunder by the Company, but
will at all times in good faith assist
in the carrying out of all of the
provisions of this paragraph 9 and in the
taking of all such action necessary or
appropriate in order to protect the
rights of the holder of this Warrant
against impairment.
10.
Consolidation, Merger or Sale of Assets. In case of any
consolidation
of the Company with, or merger of the
Company into, any other Person, any merger
of another Person into the Company (other
than a consolidation or merger which
does not result in any reclassification,
conversion, exchange or cancellation of
outstanding shares of Common Stock) or any
sale or transfer of all or
substantially all of the assets of the
Company or of the Person formed by such
consolidation or resulting from such merger
or which acquires such assets, as
the case may be, the Holder shall have the
right thereafter, upon exercise of
this Warrant in accordance with and subject
to all of the provisions of this
Warrant, to receive the kind and amount of
securities, cash and other property
receivable upon such consolidation, merger,
sale or transfer by a holder of the
number of shares of Common Stock for which
this Warrant may have been exercised
(without applying the restrictions set
forth in paragraph 3 hereof) immediately
prior to such consolidation, merger, sale
or transfer, assuming (i) such holder
of Common Stock is not a Person with which
the Company consolidated or into
which the Company merged or which merged
into the Company or to which such sale
or transfer was made, as the case may be
("CONSTITUENT PERSON"), or an Affiliate
of a constituent Person and (ii) in the
case of a consolidation, merger, sale or
transfer which includes an election as to
the consideration to be received by
the holders, such holder of Common Stock
failed to exercise its rights of
election, as to the kind or amount of
securities, cash and other property
receivable upon such consolidation, merger,
sale or transfer (provided that if
the kind or amount of securities, cash and
other property receivable upon such
consolidation, merger, sale or transfer is
not the same for each share of Common
Stock held immediately prior to such
consolidation, merger, sale or transfer by
other than a constituent Person or an
Affiliate thereof and in respect of which
such rights of election shall not have been
exercised ("NON-ELECTING SHARE"),
then for the purpose of this paragraph 9
the kind and amount of securities, cash
and other property receivable upon such
consolidation, merger, sale or transfer
by each non-electing share shall be deemed
to be the kind and amount so
receivable per share by a plurality of the
non-electing shares). Adjustments for
events subsequent to the effective date of
such a consolidation, merger and sale
of assets shall be as nearly equivalent as
may be practicable to the adjustments
provided for in this Warrant. In any such
event, effective provisions shall be
made in the certificate or articles of
incorporation of the resulting or
surviving corporation, in any contract of
sale, conveyance, lease or transfer,
or otherwise so that the provisions set
forth herein for the protection of the
rights of the Holder shall thereafter
continue to be applicable; and any such
resulting or surviving corporation shall
expressly assume the obligation to
deliver, upon exercise, such shares of
stock, other securities, cash and
property. The
11
<PAGE>
provisions of this paragraph 10 shall
similarly apply to successive
consolidations, mergers, sales, leases or
transfers.
11. Notices. All
notices, requests and other communications to any party
hereunder shall be in writing (including
facsimile transmission and electronic
mail ("E-MAIL") transmission, so long as a
receipt of such e-mail is requested
and received) and shall be given,
if to Ford,
to:
Ford Motor Company
Office of the Secretary
One American Road
11th Floor World Headquarters
Dearborn, Michigan 48126
Facsimile No.: (313) 248-8713
E-mail: psherry@ford.com
with a copy
to:
Ford Motor Company
Office of the General Counsel
One American Road
320 World Headquarters
Dearborn, Michigan 48126
Facsimile No.: (313) 337-3209
E-mail: mnunn@ford.com
and to:
Davis Polk & Wardwell
450 Lexington Avenue
New York, New York 10017
Attention: Paul R. Kingsley
Facsimile No.: (212) 450-3800
E-mail: paul.kingsley@dpw.com
if to the
Company, to:
Visteon Corporation
One Village Center Drive
Van Buren Township, Michigan 48111
Attention: John Donofrio, General Counsel
Facsimile No.: (734) 710-7132
E-mail: jdonofri@visteon.com
12
<PAGE>
with a copy
(which shall not constitute notice) to:
Weil, Gotshal & Manges LLP
767 Fifth Avenue
New York, NY 10153
Attention: Michael E. Lubowitz
Facsimile No.: (212) 310-8007
E-mail: michael.lubowitz@weil.com
or such other address, facsimile number or
e-mail address as such party may
hereafter specify for the purpose by notice
to the other parties hereto. All
such notices, requests and other
communications shall be deemed received on the
date of receipt by the recipient thereof if
received prior to 5:00 p.m. in the
place of receipt and such day is a Business
Day in the place of receipt.
Otherwise, any such notice, request or
communication shall be deemed not to have
been received until the next succeeding
Business Day in the place of receipt.
12. Rights of
the Holder. Prior to the exercise of any Warrant, the Holder
shall not, by virtue hereof, be entitled to
any rights of a shareholder of the
Company, including, without limitation, the
right to vote, to receive dividends
or other distributions, to exercise any
preemptive right or to receive any
notice of meetings of shareholders or any
notice of any proceedings of the
Company except as may be specifically
provided for herein.
13. Governing
Law. This Warrant shall be governed by and construed in
accordance with the law of the State of
Michigan, without regard to the
conflicts of law rules of such state.
14. Dispute
Resolution.
(a) If a dispute arises between the parties relating to this
Warrant,
the following shall be the sole and
exclusive procedure for enforcing the terms
hereof and for seeking relief, including
but not limited to damages, injunctive
relief and specific performance:
(i) The parties promptly shall hold a meeting of senior
executives with decision-making authority to attempt in good faith
to
negotiate a mutually satisfactory resolution of the dispute;
provided
that no party shall be under any obligation whatsoever to
reach,
accept or agree to any such resolution; provided further, that no
such
meeting shall be deemed to vitiate or reduce the obligations
and
liabilities of the parties or be deemed a waiver by a party hereto
of
any remedies to which such party would otherwise be entitled.
(ii) If the parties are unable to negotiate a mutually
satisfactory resolution as provided above, then upon request by
either
party, the matter shall be submitted to binding arbitration
13
<PAGE>
before a sole arbitrator in accordance with the CPR Rules,
including
discovery rules, for Non-Administered Arbitration. Within five
(5)
Business Days after the selection of the arbitrator, each party
shall
submit its requested relief to the other party and to the
arbitrator
with a view toward settling the matter prior to commencement of
discovery. If no settlement is reached, then discovery shall
proceed.
Upon the conclusion of discovery, each party shall again submit to
the
arbitrator its requested relief (which may be modified from the
initial submission) and the arbitrator shall select only the
entire
requested relief submitted by one party or the other, as the
arbitrator deems most appropriate. The arbitrator shall not select
one
party's requested relief as to certain claims or counterclaims and
the
other party's requested relief as to other claims or
counterclaims.
Rather, the arbitrator must only select one or the other
party's
entire requested relief on all of the asserted claims and
counterclaims, and the arbitrator shall enter a final ruling
that
adopts in whole such requested relief. The arbitrator shall
limit
his/her final ruling to selecting the entire requested relief
he/she
considers the most appropriate from those submitted by the
parties.
(iii) Arbitration shall take place in the City of Dearborn,
Michigan unless the parties agree otherwise or the arbitrator
selected
by the parties orders otherwise. Punitive or exemplary damages
shall
not be awarded. This paragraph 14 is subject to the Federal
Arbitration Act, 28 U.S.C.A. Section 1, et seq., or comparable
legislation in non-U.S. jurisdictions, and judgment upon the
award
rendered by the arbitrator may be entered by any court having
jurisdiction.
15.
Jurisdiction. Subject to paragraph 14, the parties hereto agree
that
any suit, action or proceeding seeking to
enforce any provision of, or based on
any matter arising out of or in connection
with, this Warrant or the
transactions contemplated hereby shall be
brought in any federal court sitting
in Michigan or any Michigan State court
sitting in Wayne County or Oakland
County, Michigan, so long as one of such
courts shall have subject matter
jurisdiction over such suit, action or
proceeding, and that any cause of action
arising out of this Warrant shall be deemed
to have arisen from a transaction of
business in the State of Michigan. Each of
the parties hereby irrevocably
consents to the jurisdiction of such courts
(and of the appropriate appellate
courts therefrom) in any such suit, action
or proceeding and irrevocably waives,
to the fullest extent permitted by law, any
objection that it may now or
hereafter have to the laying of the venue
of any such suit, action or proceeding
in any such court or that any such suit,
action or proceeding brought in any
such court has been brought in an
inconvenient forum. Process in any such suit,
action or proceeding may be served on any
party anywhere in the world, whether
within or without the jurisdiction of any
such court.
14
<PAGE>
16. Amendments;
Waivers. Any provision of this Warrant Certificate may be
amended or waived if, but only if, such
amendment or waiver is in writing and is
signed, in the case of an amendment, by the
Holder and the Company, or in the
case of a waiver, by the party against whom
the waiver is to be effective;
provided that if there shall be more than
one Holder of this Warrant, any
amendment of this Warrant Certificate
approved by the Company and holders of a
majority of the Warrant Shares will be
binding on each Holder. No failure or
delay by either party in exercising any
right, power or privilege hereunder
shall operate as a waiver thereof nor shall
any single or partial exercise
thereof preclude any other or further
exercise thereof or the exercise of any
other right, power or privilege. The rights
and remedies herein provided shall
be cumulative and not exclusive of any
rights or remedies provided by law.
15
<PAGE>
IN WITNESS
WHEREOF, the Company has duly caused this Warrant Certificate
to
be signed by its duly authorized officer
and to be dated as of October 1, 2005.
VISTEON CORPORATION
By: /s/ James F. Palmer
------------------------------------
Name: James F. Palmer
Title: Executive Vice President
and Chief Financial Officer
Acknowledged and Agreed:
FORD MOTOR COMPANY
By: /s/ Donat R. Leclair
---------------------------------
Name: Donat R. Leclair
Title: Executive Vice President and
Chief Financial Officer
16
<PAGE>
EXHIBIT 10.2
STOCKHOLDER AGREEMENT
dated as of
October 1, 2005
between
VISTEON CORPORATION
and
FORD MOTOR COMPANY
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S>
<C>
ARTICLE 1
DEFINITIONS
Section 1.01.
Definitions................................................
1
ARTICLE 2
REGISTRATION RIGHTS
Section 2.01. Shelf
Registration......................................... 4
Section 2.02. Demand
Registration........................................ 4
Section 2.03.
Postponement...............................................
7
Section 2.04. Piggyback
Registration..................................... 8
Section 2.05.
Expenses...................................................
9
Section 2.06. Registration and
Qualification............................. 9
Section 2.07. Underwriting; Due
Diligence................................ 12
Section 2.08. Indemnification and
Contribution........................... 13
Section 2.09. Rule 144 and Form
S-3...................................... 17
Section 2.10. Lock-Up
Agreements......................................... 17
Section 2.11. Inconsistent
Agreements.................................... 18
ARTICLE 3
VOTING
Section 3.01. Voting of Warrant
Shares................................... 18
ARTICLE 4
STANDSTILL
Section 4.01.
Standstill.................................................
19
ARTICLE 5
HEDGING
Section 5.01. Limitations on
Hedging..................................... 21
Section 5.02.
Notice.....................................................
21
</TABLE>
i
<PAGE>
<TABLE>
<S>
<C>
ARTICLE 6
TRANSFER RESTRICTIONS
Section 6.01. Transfers; Rights of
Transferees of Registrable
Securities; Legends........................................
22
ARTICLE 7
MISCELLANEOUS
Section 7.01.
Remedies...................................................
23
Section 7.02. Waiver; Consents to
Amendments............................. 23
Section 7.03. Successors and
Assigns..................................... 23
Section 7.04.
Severability...............................................
24
Section 7.05. Counterparts; Effectiveness; Third Party
Beneficiaries.... 24
Section 7.06. Descriptive Headings;
Interpretation....................... 24
Section 7.07. Governing
Law.............................................. 24
Section 7.08. Dispute
Resolution......................................... 24
Section 7.09.
Jurisdiction...............................................
25
Section 7.10. WAIVER OF JURY
TRIAL....................................... 26
Section 7.11. Addresses and
Notices...................................... 26
Section 7.12. Business
Days.............................................. 27
</TABLE>
ii
<PAGE>
STOCKHOLDER AGREEMENT
AGREEMENT (this
"AGREEMENT") dated as of October 1, 2005 between Ford Motor
Company, a Delaware corporation ("FORD"),
and Visteon Corporation, a Delaware
corporation (the "COMPANY").
WITNESSETH:
WHEREAS,
pursuant to the Visteon "A" Transaction Agreement dated as of
September 12, 2005 between Ford and the
Company (the "TRANSACTION AGREEMENT"),
among other things Ford is acquiring a
warrant for the purchase of shares of
common stock, par value $1.00 per share, of
the Company (the "COMMON STOCK");
and
WHEREAS, the
parties hereto desire to enter into this Agreement to govern
certain of their rights, duties and
obligations after consummation of the
transactions contemplated by the
Transaction Agreement;
NOW, THEREFORE,
in consideration of the mutual promises made herein and
other good and valuable consideration, the
receipt and sufficiency of which are
hereby acknowledged, the parties hereto,
intending to be legally bound, agree as
follows:
ARTICLE 1
DEFINITIONS
Section 1.01.
Definitions. (a) The following capitalized terms shall have
the meanings set forth below:
"AFFILIATE"
means, with respect to any Person, any other Person directly or
indirectly controlling, controlled by, or
under common control with such other
Person. For the purpose of this definition,
the term "control" (including, with
correlative meanings, the terms
"controlling", "controlled by" and "under common
control with"), as used with respect to any
Person, means having the right to
elect a majority of the board of directors
or other comparable body responsible
for management and direction of a Person,
or otherwise having, directly or
indirectly, the power to direct or cause
the direction of the management and
policies of such Person, by contract or by
virtue of share ownership.
"BENEFICIAL
OWNERSHIP" shall be determined in accordance with Rule 13d-3
under the 1934 Act.
"BOARD OF
DIRECTORS" means the board of directors of the Company.
<PAGE>
"BUSINESS DAY"
means a day, other than Saturday, Sunday or other day on
which commercial banks in Detroit, Michigan
are authorized or required by law to
close.
"CLOSING" means
the date on which the transactions contemplated by the
Transaction Agreement are consummated.
"HEDGING
TRANSACTION" means, with respect to any security, a short sale
with respect to such security, entering
into or acquiring an offsetting
derivative contract with respect to such
security, entering into or acquiring a
futures or forward contract to deliver such
security or entering into any other
hedging or other derivative transaction
that has the effect of materially
changing the economic benefits and risks of
ownership.
"HOLDER" means
Ford and, subject to Article 6, any Permitted Transferees.
"INITIAL
REQUESTING HOLDER" means the Requesting Holders initiating the
registration pursuant to the first sentence
of Section 2.02(a).
"MAJORITY
HOLDERS" means the Holders holding a majority in aggregate of
the
Registrable Securities held by all
Holders.
"1933 ACT" means
the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.
"1934 ACT" means
the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated
thereunder.
"OTHER
SECURITIES" has the meaning ascribed thereto in Section
2.04(a).
"PERMITTED
TRANSFEREE" means any Person to whom the Registrable Securities
are transferred in accordance with Article
6.
"PERSON" means
an individual, corporation, partnership, limited liability
company, association, trust or other entity
or organization, including a
government or political subdivision or an
agency or instrumentality thereof.
"REGISTRABLE
SECURITIES" means (i) the Warrant Shares and (ii) any
securities issued directly or indirectly
with respect to such securities by way
of a split, dividend, or other division of
securities, or in connection with a
combination of securities,
recapitalization, merger, consolidation or other
reorganization of the Company. As to any
particular Registrable Securities, such
Registrable Securities shall cease to be
Registrable Securities when they (A)
have been effectively registered under the
1933 Act and disposed of in
accordance with the registration statement
covering them, (B) have been sold
pursuant to Rule 144 under the 1933 Act,
(C) could immediately be sold pursuant
to Rule 144(k) under the 1933 Act or (D)
have been repurchased by the Company or
otherwise cease to be outstanding.
2
<PAGE>
"REGISTRATION
EXPENSES" means any and all expenses incident to performance
of or compliance with any registration or
marketing of securities pursuant to
Article 2, including (i) the fees,
disbursements and expenses of the Company's
counsel and accountants in connection with
this Agreement and the performance of
the Company's obligations hereunder
(including the expenses of any annual audit
letters and "cold comfort" letters required
or incidental to the performance of
such obligations); (ii) all expenses,
including filing fees, in connection with
the preparation, printing and filing of the
registration statement, any
preliminary prospectus or final prospectus,
any other offering document and
amendments and supplements thereto and the
mailing and delivering of copies
thereof to any underwriters and dealers;
(iii) the cost of printing and
producing any agreements among
underwriters, underwriting agreements, selling
group agreements and any other customary
documents in connection with the
marketing of securities pursuant to Article
2; (iv) all expenses in connection
with the qualification of the securities to
be disposed of for offering and sale
under state securities laws, including the
reasonable fees and disbursements of
counsel for the underwriters or the Holders
of securities in connection with
such qualification and in connection with
any blue sky and legal investment
surveys, including the cost of printing and
producing any such blue sky or legal
investment surveys; (v) the filing fees
incident to securing any required review
by the National Association of Securities
Dealers, Inc. of the terms of the
securities being registered pursuant to
Article 2; (vi) transfer agents' and
registrars' fees and expenses and the fees
and expenses of any other agent or
trustee appointed in connection with such
offering; (vii) all security engraving
and security printing expenses; (viii) all
fees and expenses payable in
connection with the listing of the
securities on any securities exchange or
automated interdealer quotation system;
(ix) the costs and expenses of the
Company and its officers relating to
analyst or investor presentations, if any,
or any "road show" undertaken in connection
with the registration and/or
marketing of any Registrable Securities;
and (x) the reasonable fees and
expenses (up to a maximum of Thirty
Thousand Dollars ($30,000) in the aggregate
for all registrations contemplated by this
Agreement) of no more than one legal
counsel to the Holders selected by Holders
holding a majority of the Registrable
Securities included in the relevant
registration statement, as applicable. In no
event shall Registration Expenses be deemed
to include underwriting discounts
and commissions, brokerage fees and
transfer taxes, if any.
"REQUESTING HOLDERS" means the
Holders requesting the registration of their
Registrable Securities pursuant to Section
2.02(a) or 2.02(f).
"RULE 415
OFFERING" means an offering on a delayed or continuous basis
pursuant to Rule 415 (or any successor rule
to similar effect) promulgated under
the 1933 Act.
"SEC" means the
Securities and Exchange Commission.
3
<PAGE>
"SELLING HOLDER"
means a Holder of Registrable Securities included in the
relevant registration statement.
"SHELF
REGISTRATION STATEMENT" means a "shelf" registration statement
of
the Company relating to a Rule 415 Offering
which covers all of the Registrable
Securities held by the Holders, on Form S-3
under the 1933 Act, and all
amendments and supplements to such
registration statement, including
post-effective amendments, in each case
including the Prospectus contained
therein, all exhibits thereto and all
materials incorporated by reference
therein.
"WARRANT" means
the Warrant to purchase shares of Common Stock as described
in the Transaction Agreement.
"WARRANT SHARES"
means the shares of Common Stock deliverable upon exercise
of the Warrant, as adjusted from time to
time.
ARTICLE 2
REGISTRATION RIGHTS
Section 2.01.
Shelf Registration. Provided that the Company is eligible to
file a registration statement on Form S-3,
it shall, not later than 270 days
after the date hereof or, if later, as soon
as is reasonably practicable after
it becomes eligible to file a registration
statement on Form S-3, cause to be
filed a Shelf Registration Statement, and
shall use its reasonable best efforts
to have such Shelf Registration Statement
declared effective by the SEC within
one year after the date hereof or as soon
as is reasonably practicable after it
becomes eligible to use Form S-3.
(b) Subject to
the terms of this Agreement, the Company agrees to use
reasonable best efforts to keep the Shelf
Registration Statement continuously
effective from the date the SEC declares
the Shelf Registration Statement
effective until the first date that the
Holders cease to hold any Registrable
Securities.
Section 2.02.
Demand Registration. If at any time after the first
anniversary of the Closing or after a
Change of Control (as defined in the
Warrant), a Shelf Registration Statement is
not effective (subject to any
permitted postponement pursuant to Section
2.03), the Majority Holders may
request in writing that the Company effect
the registration under the 1933 Act
of any or all of the Registrable Securities
held by such requesting Holders,
which notice shall specify the intended
method or methods of disposition of such
Registrable Securities. Except as otherwise
provided herein, the Company shall
prepare and (within ninety (90) days after
such request has been given) file
with the SEC a registration statement with
respect to (x) all Registrable
Securities included in such request and (y)
all Registrable Securities included
in any request delivered
4
<PAGE>
by the Requesting Holders pursuant to
Section 2.02(f), and thereafter use its
reasonable best efforts to effect the
registration under the 1933 Act and
applicable state securities laws of such
Registrable Securities for disposition
in accordance with the intended method or
methods of disposition stated in such
request; provided that the Company shall
not be obligated to effect any such
registration pursuant to this Section
2.02(a) if (i) within thirty (30) days of
receipt of a written request from the
Requesting Holders, the Company gives
notice to the Requesting Holders that the
Company intends to effect an offering
of the Company's securities for the
Company's account and has taken substantial
steps (including, but not limited to,
selecting a managing underwriter or
placement agent for such offering) and is
proceeding with reasonable diligence
to effect such offering (provided that in
such case, the Company shall, subject
to Section 2.04(c), use its reasonable best
efforts to include in the
registration relating to such public
offering all Registrable Securities
requested to be included by any Holder
pursuant to Section 2.04(c) and, in the
event Section 2.04(c) applies to such
registration, shall include in such
registration a number of such Registrable
Securities that is equal to at least
25% of the shares of Common Stock (on an
as-converted basis, with respect to
securities convertible into or exchangeable
for Common Stock to be included in
such registration) that the Company is
registering pursuant to such
registration) or (ii) the Requesting
Holders propose to sell less than all
Registrable Securities then held by them
pursuant to such registration statement
and the estimated aggregate price to the
public of such Registrable Securities
is less than Five Million Dollars
($5,000,000).
(b) The Majority
Holders may collectively exercise their rights under this
Section 2.02 on not more than three
occasions.
(c) The Holders
shall not have the right to require the filing of a
registration statement pursuant to this
Section 2.02 while any registration
statement that has been filed pursuant to
this Section 2.02 has yet to become
effective or within six months following
the effectiveness of any registration
statement on Form S-1 that was filed
pursuant to this Section 2.02.
(d) A
registration pursuant to this Section 2.02 shall not be deemed
to
have been effected (and, therefore, rights
of a Requesting Holder shall be
deemed not to have been exercised for
purposes of paragraph (a) above) (i) if it
has not become effective, (ii) if after it
has become effective such
registration (or the use of the prospectus
contained in such registration
statement) is (A) interfered with by any
stop order, injunction or other order
or requirement of the SEC or other
governmental agency or court for any reason
other than a misrepresentation or an
omission by any Holder or underwriter or
(B) delayed, withdrawn, suspended or
terminated and, in each case, as a result
thereof, the Registrable Securities
requested to be registered cannot be
completely distributed in accordance with
the plan of distribution set forth in
the related registration statement (until
such time as the Registrable
Securities requested to be registered may
be completely distributed in
accordance with the plan of distribution
set forth in the related
5
<PAGE>
registration statement) or (iii) if the
conditions to closing specified in any
purchase agreement or underwriting
agreement containing customary terms for
secondary offerings by selling
securityholders entered into by the Company in
connection with such registration are not
satisfied or waived other than because
of some act or omission by any Holder or
underwriter.
(e) In the event
that any registration pursuant to Section 2.02(a) shall
involve, in whole or in part, an
underwritten offering, the Holders of a
majority of the Registrable Securities to
be registered shall select the lead
underwriter or underwriters (which
selection or selections shall be subject to
the approval of the Company, which approval
shall not be unreasonably withheld),
as well as counsel for the Holders, with
respect to such registration. The
parties hereto acknowledge and agree that
the Company shall have sole discretion
with respect to the selection of
underwriters for any registration pursuant to
Section 2.04 that involves an underwritten
offering.
(f) Upon receipt
of a written request from the Initial Requesting Holders
pursuant to the first sentence of Section
2.02(a), the Company shall promptly
give written notice of such requested
registration to all other Holders of
Registrable Securities and the intended
method or methods of disposition stated
in such request. Each other Holder may, by
written notice to the Company to be
delivered within ten (10) days of the
delivery of the Company's notice, request
the inclusion in such registration of any
Registrable Securities held by such
other Holder. The Company shall promptly
after the expiration of such 10-day
period notify each Requesting Holder of (i)
the identity of the other Requesting
Holders and (ii) the number of Registrable
Securities requested to be included
therein by each Requesting Holder. In the
event that the Initial Requesting
Holders intend to distribute the
Registrable Securities covered by their request
by means of an underwriting, the right of
any Holder to include all or any
portion of its Registrable Securities in
such registration shall be conditioned
upon such Holder's participation in such
underwriting and the inclusion of such
Holder's Registrable Securities in the
underwriting to the extent provided
herein. All Holders proposing to distribute
all of any portion of their
Registrable Securities through such
underwriting shall enter into an
underwriting agreement in customary form
(for secondary sales by selling
stockholders) with the underwriter or
underwriters selected pursuant to Section
2.02(e).
(g) The Company
shall have the right to cause the registration of
additional equity securities for sale for
the account of any Person that is not
a Holder (including the Company and any
directors, officers or employees of the
Company (such additional equity securities,
the "ADDITIONAL EQUITY SECURITIES"))
in any registration of Registrable
Securities requested by the Requesting
Holders; provided that if such registration
is to be an underwritten
registration and such Requesting Holders
are advised in writing (with a copy to
the Company) by a nationally recognized
investment banking firm selected
pursuant to paragraph (e) above that, in
such firm's good faith view, all or a
part of the equity securities to
6
<PAGE>
be included in such registration (including
any Additional Equity Securities)
cannot be sold and the inclusion of all or
part of the equity securities that
would otherwise be included in such
registration would be likely to have an
adverse effect on the price, timing or
distribution of the offering and sale of
the equity securities to be included in
such registration, then the Company
shall exclude from such registration such
Additional Equity Securities or part
thereof, to the nearest extent possible on
a pro rata basis, in which case the
Company shall include in such
registration:
(i) first, up to the full number of Registrable Securities and
(ii) second, up to the full number of any other Additional
Equity
Securities, if
any, in excess of the Registrable Securities to be sold in
such offering
which, in the good faith view of such investment banking
firm, can be so
sold without so adversely affecting such offering in the
manner described
above.
In the event
that the number of Registrable Securities requested to be
included in a registration statement that
will not include any Additional Equity
Securities by the Requesting Holders
exceeds the number which, in the good faith
view of such investment banking firm, can
be sold without adversely affecting
the price, timing, distribution or sale of
securities in the offering, the
number shall be allocated pro rata among
all of the Requesting Holders on the
basis of the relative number of Registrable
Securities then held by each such
Requesting Holder (with any number in
excess of a Requesting Holder's request
reallocated among the remaining Requesting
Holders in a like manner).
Section 2.03.
Postponement. The Company shall be entitled to postpone for a
reasonable period of time up to ninety (90)
days the filing of any registration
statement or any amendment or supplement
thereto otherwise required to be
prepared and filed by it pursuant to
Section 2.01 or 2.02 if the Company
furnishes to the Holders a certified
resolution of the Board of Directors (the
"CERTIFIED RESOLUTION") stating that the
Company or any of its Subsidiaries is
engaged in confidential negotiations or
other confidential business activities
(or the Board of Directors determines that
the Company is at such time otherwise
in possession of material non-public
information with respect to the Company or
any of its Subsidiaries), disclosure of
which would be required in such
registration statement, and the Board of
Directors determines in good faith that
such disclosure would be materially
detrimental to the Company and its
stockholders other than the Holders. A
deferral of the filing of a registration
statement pursuant to this Section 2.03
shall be lifted, and the registration
statement shall be filed forthwith, if the
negotiations or other activities are
terminated or publicly disclosed (or such
material non-public information has
been publicly disclosed by the Company). In
order to defer the filing of a
registration statement pursuant to this
Section 2.03, the Company shall promptly
(but in any event within ten (10) days),
upon determining to seek such deferral,
deliver to the Holders (subject to
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<PAGE>
the Holders entering into a customary
confidentiality obligation as to such
information, which the Holders hereby agree
to do) the Certified Resolution
stating that the Company is deferring such
filing pursuant to this Section 2.03
and an approximation of the anticipated
delay. Notwithstanding anything to the
contrary contained herein, the Company may
not postpone a filing under this
Section 2.03 more than once in any 180 day
period.
Section 2.04.
Piggyback Registration. In the event that the Company
proposes to register any of its Common
Stock, any other of its equity securities
or securities convertible into or
exchangeable for its equity securities
(collectively, including Common Stock,
"OTHER SECURITIES") under the 1933 Act,
whether or not for sale for its own
account, in a manner that would permit
registration of Registrable Securities for
sale for cash to the public under the
1933 Act, it shall so long as Holders own
Registrable Securities, give prompt
written notice to each Holder of its
intention to do so and of the rights of
such Holder under this Section 2.04.
Subject to the terms and conditions hereof,
such notice shall offer each such Holder
the opportunity to include in such
registration statement such number of
Registrable Securities as such Holder may
request. Upon the written request of any
such Holder made within ten (10) days
after the receipt of the Company's notice
(which request shall specify the
number of Registrable Securities intended
to be disposed of and the intended
method of disposition thereof), the Company
shall use its reasonable best
efforts to effect, in connection with the
registration of the Other Securities,
the registration under the 1933 Act of all
Registrable Securities which the
Company has been so requested to register,
to the extent required to permit the
disposition (in accordance with such
intended methods thereof) of the
Registrable Securities so requested to be
registered. Notwithstanding the
immediately preceding sentence, in the
event that the holders of the Other
Securities intend to distribute the Other
Securities covered by such
registration by means of an underwriting,
the right of any Holder to include all
or any portion of its Registrable
Securities in such registration shall be
conditioned upon such Holder's
participation in such underwriting and the
inclusion of such Holder's Registrable
Securities in the underwriting to the
extent provided herein. All Holders
proposing to distribute all or any portion
of their Registrable Securities through
such underwriting shall enter into an
underwriting agreement in customary form
(for secondary sales by selling
stockholders) with the underwriter or
underwriters.
(b) If, at any
time after giving a written notice of its intention to
register any Other Securities and prior to
the effective date of the
registration statement filed in connection
with such registration, the Company
shall determine for any reason not to
register the Other Securities, the Company
may, at its election, give written notice
of such determination to such Holders
and thereupon the Company shall be relieved
of its obligation to register such
Registrable Securities in connection with
the registration of such Other
Securities, without prejudice, however, to
the rights of the Holders immediately
to request that such registration be
effected as a registration under Section
2.02 to the extent permitted
thereunder.
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<PAGE>
(c) If the
registration referred to in the first sentence of Section
2.04(a) is to be an underwritten
registration and a nationally recognized
investment banking firm selected by the
Company advises the Company in writing
that, in such firm's good faith view, the
inclusion of all or a part of such
Registrable Securities in such registration
would be likely to have an adverse
effect upon the price, timing or
distribution of the offering and sale of the
Other Securities then contemplated, the
Company shall include in such
registration:
(i) first, all Other Securities the Company proposes to sell for
its
own account,
(ii) second, any securities of the Company to be registered
pursuant
to "demand"
registration rights existing as of the date hereof, and
(iii) third, up to the full number of Registrable Securities held
by
Holders of
Registrable Securities in excess of the number of Other
Securities to be
sold in such offering which, in the good faith view of
such investment
banking firm, can be so sold without so adversely affecting
such offering in
the manner described above.
(d) The Company
shall not be required to effect any registration of
Registrable Securities under this Section
2.04 incidental to the registration of
any of its securities in connection with
mergers, acquisitions, exchange offers,
subscription offers, dividend reinvestment
plans or stock option or other
executive or employee benefit or
compensation plans or in connection with the
filing of a Form S-4 or Form S-8
registration statement.
(e) No
registration of Registrable Securities effected under this
Section
2.04 shall relieve the Company of its
obligation to effect a registration of
Registrable Securities pursuant to Section
2.01 or 2.02.
Section 2.05.
Expenses. Except as provided herein, the Company shall pay
all Registration Expenses under this
Article 2 with respect to a particular
offering (or proposed offering). Each
Selling Holder shall bear the fees and
expenses of its own counsel as well as all
underwriting discounts and
commissions, brokerage fees and taxes,
except that reasonable fees and expenses
(up to a maximum of Thirty Thousand Dollars
($30,000) in the aggregate for all
registrations contemplated by this
Agreement) of one counsel representing all
Selling Holders selected by the Selling
Holders holding a majority of the
Registrable Securities included in the
relevant registration statement, as
applicable, will constitute Registration
Expenses.
Section 2.06.
Registration and Qualification. If the Company is required to
effect the registration of any Registrable
Securities under the 1933 Act as
provided in Section 2.01, 2.02 or 2.04, the
Company shall as promptly as
practicable, but subject to the other
provisions of this Agreement:
9
<PAGE>
(a) prepare,
file and use its reasonable best efforts to cause to become
effective a registration statement under
the 1933 Act relating to the
Registrable Securities to be offered in
accordance with the intended method of
disposition thereof;
(b) prepare and
file with the SEC such amendments and supplements to such
registration statement and the prospectus
used in connection therewith as may be
necessary to keep such registration
statement continuously effective and to
comply with the provisions of the 1933 Act
with respect to the disposition of
all such Registrable Securities until such
time as all of such Registrable
Securities have been disposed of in
accordance with the intended methods of
disposition set forth in such registration
statement; provided that the Company
will, at least five (5) Business Days prior
to filing a registration statement
or prospectus or any amendment or
supplement thereto, furnish to each Selling
Holder copies of such registration
statement or prospectus (or amendment or
supplement) as proposed to be filed
(including, upon the request of such Holder,
documents to be incorporated by reference
therein) which documents will be
subject to the reasonable review and
comments of such Holder (and its attorneys)
during such 5 business-day period and the
Company will not file any registration
statement, any prospectus or any amendment
or supplement thereto (or any such
documents incorporated by reference)
containing any statements with respect to
such Holder to which such Holder shall
reasonably object in writing; it being
agreed that there is no need to pre-deliver
or give a right to review of any
1934 Act filing that is fully incorporated
by reference;
(c) furnish to
the Selling Holders and to any underwriter of such
Registrable Securities such number of
conformed copies of such registration
statement and of each such amendment and
supplement thereto (in each case
including all exhibits), such number of
copies of the prospectus included in
such registration statement (including each
preliminary prospectus and any
summary prospectus), in conformity with the
requirements of the 1933 Act, such
documents incorporated by reference in such
registration statement or
prospectus, and such other documents as the
Selling Holders or such underwriter
may reasonably request, and, upon the
request of the Selling Holders or such
underwriter, a copy of any and all
transmittal letters or other correspondence
to or received from, the SEC or any other
governmental agency or self-regulatory
body or other body having jurisdiction
(including any domestic or foreign
securities exchange) relating to such
offering;
(d) after the
filing of the registration statement, promptly notify each
Selling Holder in writing of the
effectiveness thereof and of any stop order
issued or, to the knowledge of the Company,
threatened by the SEC and use its
reasonable best efforts to prevent the
entry of such stop order or to promptly
remove it if entered and promptly notify
each Selling Holder of such lifting or
withdrawal of such order;
10
<PAGE>
(e) use its
reasonable best efforts to register or qualify all Registrable
Securities covered by such registration
statement under the securities or blue
sky laws of such U.S. jurisdictions as may
be necessary and as the Selling
Holders or any underwriter of such
Registrable Securities shall reasonably
request, and use its reasonable best
efforts to obtain all appropriate
registrations, permits and consents in
connection therewith, and do any and all
other acts and things which may be
reasonably necessary or advisable to enable
the Selling Holders or any such underwriter
to consummate the disposition in
such jurisdictions of the Registrable
Securities covered by such registration
statement; provided that the Company shall
not for any such purpose be required
to qualify generally to do business as a
foreign corporation in any such
jurisdiction wherein it is not so qualified
or to consent to general service of
process in any such jurisdiction or become
subject to taxation in any such
jurisdiction;
(f) use its
reasonable best efforts in the event of an underwritten
offering to furnish to each Selling Holder
and to any underwriter of such
Registrable Securities (i) an opinion of
counsel for the Company addressed to
each underwriter and each Selling Holder
and dated the date of the closing under
the underwriting agreement and (ii) a "cold
comfort" letter addressed to each
underwriter and each Selling Holder and
signed by the independent public
accountants who have audited the financial
statements of the Company included in
such registration statement, in each such
case covering substantially the same
matters with respect to such registration
statement (and the prospectus included
therein) as are customarily covered in
opinions of issuer's counsel and in
accountants' letters delivered to
underwriters in connection with the
consummation of underwritten secondary
public offerings of securities by selling
securityholders;
(g) as promptly
as practicable, notify the Selling Holders in writing (i)
at any time when a prospectus relating to a
registration pursuant to Section
2.01, Section 2.02 or Section 2.04 is
required to be delivered under the 1933
Act of the happening of any event as a
result of which the prospectus included
in such registration statement, as then in
effect, includes an untrue statement
of a material fact or omits to state any
material fact required to be stated
therein or necessary to make the statements
therein, in light of the
circumstances under which they were made,
not misleading, and (ii) of any
request by the SEC or any other regulatory
body or other body having
jurisdiction for any amendment of or
supplement to any registration statement or
other document relating to such offering,
and in either such case, at the
request of the Selling Holders (but subject
to Section 2.03) prepare and furnish
to the Selling Holders as promptly as
practicable a reasonable number of copies
of a supplement to or an amendment of such
prospectus as may be necessary so
that, as thereafter delivered to the
purchasers of such Registrable Securities,
such prospectus shall not include an untrue
statement of a material fact or omit
to state a material fact required to be
stated therein or necessary to make the
statements therein, in light of the
circumstances under which they are made, not
misleading (and the Selling Holders agree
to immediately discontinue use
11
<PAGE>
(and cause each other person acting on its
behalf to immediately discontinue
use) of the prospectus included in such
registration statement following receipt
of such notice until such time as such
prospectus shall have been so amended or
supplemented or such time as the Company
shall have provided the Selling Holders
with a subsequent notice to the effect that
such prospectus may again be used);
(h) if requested
by the lead or managing underwriters or Selling Holders,
use its reasonable best efforts to list all
such Registrable Securities covered
by such registration on each securities
exchange and automated inter-dealer
quotation system on which the Common Stock
is then listed;
(i) upon the
Selling Holders' reasonable request, send appropriate officers
of the Company to attend customary "road
shows" and analyst and investor
presentations scheduled in connection with
any such underwritten offering of
Registrable Securities; provided, however,
that attending such road show would
not unduly interfere with the operation of
the Company; and
(j) furnish for
delivery in connection with the closing of any offering of
Registrable Securities pursuant to a
registration effected pursuant to Section
2.01, Section 2.02 or Section 2.04
unlegended certificates representing
ownership of the Registrable Securities
being sold in such denominations as
shall be requested by the Selling Holders
or the underwriters.
In addition,
each Holder agrees that (i) in connection with any
registration of Registrable Securities
pursuant to this Article 2 it will timely
provide all information reasonably
necessary with respect to such Holder and its
plan of distribution, for such registration
of Registrable Securities, (ii)
failure to provide such information will
postpone the Company's obligations to
such Holder for the applicable registration
until such information is provided
and (iii) the Company will have no
obligation to update or amend selling
stockholders' information in any filing
more frequently than every 90 days.
Notwithstanding
anything to the contrary in this Article 2, the Company
shall not be obligated to effect any
offering by means of an underwritten
offering (and, without limiting the
generality of the foregoing, the Company
shall not be obligated to comply with
Section 2.07 and paragraphs (f) and (i) of
Section 2.06) unless the estimated
aggregate price to the public of the
securities to be sold thereunder are in
excess of Fifteen Million Dollars
($15,000,000).
Section 2.07.
Underwriting; Due Diligence. (a) If requested by the
underwriters for any underwritten offering
of Registrable Securities pursuant to
a registration requested under this Article
2, the Company shall enter into an
underwriting agreement with such
underwriters for such offering, which agreement
will contain such representations and
warranties and covenants by the Company
and such other terms and provisions as are
customarily contained in
12
<PAGE>
underwriting agreements with respect to
secondary distributions by selling
securityholders, including indemnification
and contribution provisions
substantially to the effect and to the
extent provided in Section 2.08, and
agreements as to the provision of opinions
of counsel and accountants' letters
to such underwriters and Selling Holders
the effect and to the extent provided
in Section 2.06(f). The Selling Holders on
whose behalf the Registrable
Securities are to be distributed by such
underwriters shall be parties to any
such underwriting agreement and the
representations and warranties by, and the
other agreements on the part of, the
Company to and for the benefit of such
underwriters, shall also be made to and for
the benefit of such Selling Holders.
Such underwriting agreement shall also
contain such representations and
warranties and covenants and
indemnification by such Selling Holders and
underwriters and such other terms and
provisions as are customarily contained in
underwriting agreements with respect to
secondary distributions on the part of
selling shareholders, including
indemnification and contribution provisions
substantially to the effect and to the
extent provided in Section 2.08.
Notwithstanding anything to the contrary
herein, such underwriting agreement
shall not require the Selling Holders to
have any liability with respect to the
representations made by, the operations of
or the disclosures made by the
Company.
(b) In
connection with the preparation and filing of each registration
statement registering Registrable
Securities under the 1933 Act under this
Article 2, upon entering into a
confidentiality agreement with the Company that
is reasonably satisfactory to the Company,
the Company shall give the
underwriters, if any, and underwriters'
counsel, and counsel for the Holders as
selected pursuant to Section 2.02(e) or by
the Selling Holders holding a
majority of the Registrable Securities
included in the relevant registration
statement, as applicable, such reasonable
and customary access to its books,
records and properties and such
opportunities to discuss the business and
affairs of the Company with its officers
and the independent public accountants
who have certified the financial statements
of the Company as shall be
necessary, in the reasonable opinion of
such underwriters, such underwriters'
counsel or such counsel for the Holders, to
conduct a reasonable investigation
within the meaning of the 1933 Act;
provided that such underwriters, such
underwriters' counsel and such counsel for
the Holders shall use their
reasonable best efforts to coordinate any
such investigation of the books,
records and properties of the Company and
any such discussions with the
Company's officers and accountants so that
all such investigations occur at the
same time and all such discussions occur at
the same time.
Section 2.08.
Indemnification and Contribution. The Company agrees to
indemnify and hold harmless each Selling
Holder and each person, if any, who
controls each Selling Holder within the
meaning of either Section 15 of the 1933
Act or Section 20 of the 1934 Act from and
against any and all losses, claims,
damages and liabilities (including, subject
to Section 2.08(c), any reasonable
legal or other costs, fees and expenses
reasonably incurred in connection with
13
<PAGE>
defending or investigating any such action
or claim) insofar as such losses,
claims, damages or liabilities are caused
by any untrue statement or alleged
untrue statement of a material fact
contained in any registration statement
filed by the Company pursuant to this
Agreement at the time it became effective
or any amendment thereof, any preliminary
prospectus (as amended or supplemented
if the Company shall have furnished any
amendments or supplements thereto) or
prospectus (as amended or supplemented if
the Company shall have furnished any
amendments or supplements thereto) relating
to the Registrable Securities, or
caused by any omission or alleged omission
to state therein a material fact
required to be stated therein or necessary
to make the statements therein not
misleading, except insofar as such losses,
claims, damages or liabilities are
caused by any such untrue statement or
omission or alleged untrue statement or
omission which is based upon information
relating to a Selling Holder or
underwriter which is furnished to the
Company in writing by or on behalf of such
Selling Holder or underwriter expressly for
use therein. The Company also agrees
to indemnify any underwriter of the
Registrable Securities so offered and each
person, if any, who controls such
underwriter on substantially the same basis as
that of the indemnification by the Company
of each Selling Holder provided in
this Section 2.08(a). Notwithstanding the
foregoing, (i) with respect to any
untrue statement or omission or alleged
untrue statement or omission made in any
preliminary prospectus, or in any
prospectus, as the case may be, the indemnity
agreement contained in this paragraph shall
not apply to the extent that any
such losses, claims, damages or liabilities
result from the fact that a current
copy of the prospectus (or such amended or
supplemented prospectus, as the case
may be) was not sent or given to the Person
asserting such losses, claims,
damages or liabilities at or prior to the
written confirmation of the sale of
the Registrable Securities concerned to
such Person if its is determined that
the Company has provided such current
prospectus (or such amended or
supplemented prospectus, as the case may
be) to any Selling Holder or
underwriter prior to such confirmation and
it was the responsibility of such
Selling Holder or underwriter to provide
such Person with a current copy of the
prospectus and such current copy of the
prospectus (or such amended or
supplemented prospectus, as the case may
be) would have cured the defect giving
rise to such loss
