UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. )(1)
-------------------------------
CELADON GROUP
(Name of Issuer)
Common Stock, $.01 par value
(Title of Class of Securities)
150838 10 0
(CUSIP Number)
--------------------------------
Howard Kailes, Esq.
Krugman, Chapnick & Grimshaw
Park 80 West - Plaza Two
Saddle Brook, New Jersey 07663
(201) 845-3434
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)
-------------------------------
July 3, 1996
(Date of Event which Requires Filing of this
Statement)
If the filing person has previously filed a statement on Schedule
13G to report the acquisition which is the subject of this Schedule
13D, and is filing this schedule because of Rule 13d-1(b)(3) or
(4), check the following box.
------
Check the following box if a fee is being paid with the statement.
X
------
(A fee is not required only if the reporting person: (a) has a
previous statement on file reporting beneficial ownership of more
than five percent of the class of securities described in Item 1;
and (2) has filed no amendment subsequent thereto reporting
beneficial ownership of five percent or less of such class.) (See
Rule 13d-7.)
Note: Six copies of this statement, including all exhibits, should
be filed with the Commission. See Rule 13d-1(a) for other parties
to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a
reporting person's initial filing on this form with respect to the
subject class of securities, and for any subsequent amendment
containing information which would alter disclosures provided in a
prior cover page.
- ---------------------
(1) Constitutes Amendment No. 2 to Schedule 13G filed jointly by
Hanseatic Corporation, Paul Biddelman and Wolfgang Traber.
<PAGE>
The information required on the remainder of this cover page shall
not be deemed to be "filed" for the purpose of Section 18 of the
Securities Exchange Act of 1934 ("Act") or otherwise subject to the
liabilities of that section of the Act but shall be subject to all
other provisions of the Act (however, see the Notes).
<PAGE>
<PAGE>
CUSIP NO. 150838 10 0
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Hanseatic Corporation
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) X
-----
(b)
-----
3 SEC USE ONLY
4 SOURCE OF FUNDS*
00
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
-----
6 CITIZENSHIP OR PLACE OR ORGANIZATION
New York
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH:
7 SOLE VOTING POWER
995,056 (see footnote 1)
8 SHARED VOTING POWER
(see footnote 2)
9 SOLE DISPOSITIVE POWER
995,056 (see footnote 1)
10 SHARED DISPOSITIVE POWER
(see footnote 2)
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
995,056 (see footnotes 1 and 2)
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES*
(see footnote 2)
<PAGE>
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
12.8% (see footnote 3)
14 TYPE OF REPORTING PERSON*
CO
- -----------------
(1) Includes 12,121 shares issuable upon exercise of outstanding
warrants.
(2) Excludes an aggregate of approximately 983,314 shares (the
"Russell Shares") beneficially owned by Stephen Russell
(including 25,000 shares issuable upon exercise of outstanding
options exercisable within 60 days) that are subject to a
stockholders' agreement among Celadon Group, Inc., Hanseatic
Corporation and Stephen Russell.
(3) Based upon an aggregate of 7,750,580 shares outstanding at May
8, 1996.
<PAGE>
<PAGE>
CUSIP NO. 150838 10 0
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Wolfgang Traber
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a)
-----
(b)
-----
3 SEC USE ONLY
4 SOURCE OF FUNDS*
Not applicable
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
-----
6 CITIZENSHIP OR PLACE OR ORGANIZATION
Germany
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH:
7 SOLE VOTING POWER
--
8 SHARED VOTING POWER
995,056 (see footnotes 1 and 2)
9 SOLE DISPOSITIVE POWER
--
10 SHARED DISPOSITIVE POWER
995,056 (see footnotes 1 and 2)
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
995,056 (see footnotes 1 and 2)
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES*
(see footnote 2)
<PAGE>
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
12.8% (see footnote 3)
14 TYPE OF REPORTING PERSON*
IN
- ---------------
(1) Represents shares beneficially owned by Hanseatic Corporation;
the undersigned holds in excess of a majority of the shares of
capital stock of Hanseatic Corporation.
(2) Excludes the Russell Shares.
(3) Based upon an aggregate of 7,750,580 shares outstanding at May
8, 1996.
<PAGE>
<PAGE>
CUSIP NO. 150838 10 0
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Paul A. Biddelman
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a)
-----
(b)
-----
3 SEC USE ONLY
4 SOURCE OF FUNDS*
Not applicable
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
-----
6 CITIZENSHIP OR PLACE OR ORGANIZATION
United States
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH:
7 SOLE VOTING POWER
12,333 (see footnote 1)
8 SHARED VOTING POWER
995,056 (see footnotes 2 and 3)
9 SOLE DISPOSITIVE POWER
12,333 (see footnote 1)
10 SHARED DISPOSITIVE POWER
995,056 (see footnotes 2 and 3)
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
1,007,389 (see footnotes 1, 2 and 3)
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN
SHARES*
(see footnote 2)
<PAGE>
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
13.0% (see footnote 4)
14 TYPE OF REPORTING PERSON*
IN
- ---------------
(1) Represents shares issuable upon exercise of outstanding
options exercisable within 60 days.
(2) Represents shares beneficially owned by Hanseatic Corporation;
the undersigned is the treasurer of Hanseatic Corporation and
its designee on the board of directors of Celadon Group, Inc.
(3) Excludes the Russell Shares.
(4) Based upon an aggregate of 7,750,580 shares outstanding at May
8, 1996.
<PAGE>
<PAGE>
Item 1. Security and Issuer.
-------------------
This statement relates to shares of the common stock, $.033
par value (the "Common Stock"), of Celadon Group, Inc., a Delaware
corporation (the "Corporation"). The principal executive offices of
the Corporation are located at 888 Seventh Avenue, New York, New
York 10106.
Item 2. Identity and Background.
-----------------------
This statement is filed jointly, pursuant to Rule 13d-1(f)(1),
by: (i) Hanseatic Corporation ("Hanseatic"), (ii) Wolfgang Traber
("Traber"), who holds in excess of a majority of the shares of
capital stock of Hanseatic, and (iii) Paul A. Biddelman
("Biddelman"), Treasurer of Hanseatic and a director of the
Corporation. Hanseatic, whose principal business is investing, has
its principal business and offices at 450 Park Avenue, Suite 2302,
New York, New York 10022. The names, citizenship, business or
residence address and principal occupation of Traber and Biddelman,
and of each executive officer and director of Hanseatic, is set
forth in Annex 1 attached hereto, which information is incorporated
herein by reference. No person or entity responding hereunder shall
be responsible for the completeness or accuracy of any information
contained herein with respect to any other person or entity.
During the last five years, neither Hanseatic, Traber, nor
Biddelman, nor to the best of the knowledge of Hanseatic, any
executive officer, director or controlling person of Hanseatic
identified in Annex 1, has (a) been convicted in a criminal
proceeding (excluding traffic violations and similar misdemeanors)
or (b) been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction, and as a result of
which it or he was or is subject to a judgment, decree or final
order enjoining future violation of, or prohibiting or mandating
activities subject to, federal or state securities laws or finding
any violations with respect to such laws.
Item 3. Source and Amount of Funds or
Other Consideration.
-----------------------------
The funds, in the amount of $4,934,826, used in purchasing an
aggregate of 548,314 shares of Common Stock on July 3, 1996, as
more fully described under Item 4 hereunder, were obtained by
Hanseatic Americas LDC, a Bahamian limited duration company in
which the sole managing member is Hansabel Partners, L.L.C., a
Delaware limited liability company in which Hanseatic is the sole
managing member, from a combination of working capital and a loan
facility provided by M.M. Warburg & Co. Luxembourg S.A.
<PAGE>
Item 4. Purpose of Transaction.
----------------------
On July 3, 1996, Hanseatic became the beneficial owner, for
purposes of Rule 13d-3 under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), of an additional 548,314 shares of
Common Stock pursuant to a Stock Purchase Agreement dated the date
thereof (the "Stock Purchase Agreement") among Leonard R. Bennett
("Bennett") and Peter Bennett, and, individually and as agent,
Stephen Russell ("Russell"), and Hanseatic.
In connection with closing under the Stock Purchase Agreement,
the Corporation, Russell, Bennett and Hanseatic amended the
stockholders agreement dated October 8, 1992 (as amended, the
"Stockholders Agreement") to release Bennett from his obligations
thereunder and to provide that, as long as Hanseatic or Russell
owns, or has the right to obtain, five percent of the outstanding
shares of Common Stock, the Corporation must use its best efforts
to ensure that one member of its Board of Directors is a designee
of Hanseatic and one member is a designee of Russell. Paul A.
Biddelman, an incumbent member of the Corporation's Board of
Directors, is the designee of Hanseatic pursuant to such
arrangements. In addition, Russell and Hanseatic have agreed to
vote all shares of Common Stock owned by them in favor of the
election of such nominees or, upon the death of Russell, for the
designee of the holder of a majority of Russell's shares of Common
Stock on the date of death, as a director of the Corporation.
Except as aforesaid, Hanseatic has acquired all securities of
the Corporation which it presently owns as an investment in the
performance of the Corporation, seeking appreciation thereof
through the efforts of current management of the Corporation.
Hanseatic intends to continue to review its investment in the
Corporation and to discuss with management the Corporation's
strategies, goals and operations, and Hanseatic may in the future
change its present course of action with a view towards otherwise
influencing the strategic goals and operations of the Corporation,
and may acquire additional shares of Common Stock. On the other
hand, Hanseatic may determine to dispose of all or a portion of the
Common Stock which it now owns or may hereafter acquire. In
reaching any conclusions as to the foregoing, Hanseatic will take
into account various factors, including the Corporation's business
and prospects, general economic conditions and money and stock
market conditions.
See Item 6 herein for information concerning warrants to
acquire additional shares of Common Stock beneficially owned by
Hanseatic, which information is incorporated by reference to this
item.
Pursuant to Rule 13d-4, any statements by Traber herein shall
not be construed as an admission that Traber is, for purposes of
Section 13(d) of 13(g) of the Exchange Act, the beneficial owner of
any securities of the Corporation. Traber does not intend to
exercise any power to vote or to direct the vote, or to dispose or
to direct the disposition of any securities of the Corporation that
<PAGE>
he may be deemed beneficially to own except as determined by
management of Hanseatic.
Except as stated in response to this Item 4, none of
Hanseatic, Traber, nor Biddelman have any plans or proposals which
relate to or would result in any other action specified in clauses
(a) through (j) of Item 4 of Schedule 13D.
Item 5. Interest in Securities of the Issuer.
------------------------------------
(a) As of July 12, 1996, Hanseatic beneficially owned, for
purposes of Rule 13d-3 under the Exchange Act, 995,056 shares (the
"Shares") of Common Stock, including 12,121 shares issuable upon
exercise of warrants (the "Warrants") held by Hanseatic,
constituting, to the best of the knowledge of Hanseatic, 12.8% of
the issued and outstanding shares of Common Stock. Such shares
exclude approximately 983,314 shares beneficially owned by Russell
(including 25,000 shares issuable upon exercise of outstanding
stock options exercisable within 60 days) subject to the
Stockholders Agreement.
Traber holds in excess of a majority of the shares of
capital stock of Hanseatic and, accordingly, may be deemed
beneficially to own the Shares, constituting, to the best of the
knowledge of Traber, 12.8% of the issued and outstanding shares of
Common Stock.
Biddelman is the Treasurer of Hanseatic, and,
accordingly, may be deemed beneficially to own the Shares in
addition to 12,333 shares (the "Option Shares") of Common Stock
issuable upon exercise of options granted by the Corporation under
its 1994 Employee Stock Option Plan and exercisable within 60 days,
in the aggregate constituting, to the best of the knowledge of
Biddelman, 13.0% of the issued and outstanding shares of Common
Stock.
(b) Excluding any effect of the relationships set forth
under the Stockholders Agreement, Hanseatic has sole power to vote
or to direct the vote of, and sole power to dispose or to direct
the disposition of, 995,056 shares of Common Stock.
Excluding any effect of the relationships set forth
under the Stockholders Agreement, Traber has shared power to vote
or to direct the vote of, and shared power to dispose or to direct
the disposition of, 995,056 shares of Common Stock.
Excluding any effect of the relationships set forth
under the Stockholders Agreement, Biddelman has sole power to vote
or direct the vote of, and sole power to dispose or to direct the
disposition of, the Option Shares, and shared power to vote or to
direct the vote of, and shared power to dispose or to direct the
disposition of, 995,056 shares of Common Stock.
<PAGE>
(c) On July 3, 1996, Hanseatic acquired an additional
548,314 shares of Common Stock pursuant to the privately negotiated
Stock Purchase Agreement for an aggregate purchase price of
$4,934,826. All of such shares were acquired on behalf of Hanseatic
Americas LDC, a Bahamian limited duration company in which the sole
managing member is Hansabel Partners LLC, a Delaware limited
liability company in which Hanseatic is the sole managing member.
(d) Hanseatic Americas LDC has the right to receive or the
power to direct the receipt of dividends from, or the proceeds from
the sale of, an aggregate of 946,121 shares of Common Stock
beneficially owned by Hanseatic, constituting approximately 12.2%
of the outstanding Common Stock. In addition, certain clients of
Hanseatic who provided funds for the purchase price of the 9.25%
Senior Subordinated Note dated October 8, 1992 (the "Note") issued
by the Corporation to Hanseatic together with the Warrants had the
right to receive or the power to direct the receipt of dividends
from, or the process from the sale of, the additional shares of
Common Stock beneficially owned by Hanseatic which were obtained
upon conversion of the Note in February 1994. No such client's
interest in such dividends or proceeds related to more than five
per cent of the outstanding Common Stock. The foregoing excludes
the effect of the relationship set forth under the Stockholders
Agreement covering shares held by Russell.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or
Relationships with Respect to Securities of the Issuer.
------------------------------------------------------
As more fully described under Item 4 herein (which information
is incorporated by reference to this item), Hanseatic is party to
the Stockholders Agreement. The Stockholders' Agreement further
provides that Russell must give Hanseatic notice of a proposed sale
of any shares of Common Stock held by him, and that Hanseatic has
the right to include certain of its own shares of Common Stock for
sale to such prospective purchaser or, alternatively, the right to
purchase all, but not less than all, of the shares proposed to be
sold by Russell, at the same price being offered by the prospective
purchaser.
In connection with Hanseatic's purchase in 1992 of the
Note, the Corporation issued to Hanseatic the Warrants to purchase,
at any time prior to September 30, 1998, 12,121 shares of Common
Stock at an exercise price of $10.82 per share. Pursuant to a
registration rights agreement dated October 8, 1992 extended by the
Corporation to Hanseatic, until October 1998 Hanseatic and its
permitted transferees have the right to require the Corporation to
file, subject to certain terms and conditions, a registration
statement in respect of any or all of the shares of Common Stock
(subject to a minimum of 363,636 shares) covered by such agreement
which are then held by the requesting holders. In addition,
Hanseatic and its permitted transferees have the right to require
<PAGE>
the Corporation to include, subject to certain exceptions, any or
all shares of Common Stock covered by such agreement in any
registration statement filed by the Corporation.
Except as stated in response to this Item 6, none of
Hanseatic, Traber nor Biddelman, nor, to the best of the knowledge
of Hanseatic, any of the executive officers or directors listed on
Annex 1, is a party to any contract, arrangement, understanding or
relationship (legal or otherwise) with any person with respect to
any securities of the Corporation, including, but not limited to,
the transfer or voting of any such securities, finder's fees, joint
ventures, loan or option arrangements, puts or calls, guaranties or
profits, divisions of profit or loss, or the giving or withholding
of proxies.
Item 7. Materials to be Filed as Exhibits.
---------------------------------
Exhibit A - Agreement pursuant to Rule 13d-1(f)(iii)
Exhibit B - Stock Purchase Agreement dated July 3, 1996
among Leonard Bennett, Peter Bennett, Stephen
Russell and Hanseatic Corporation
Exhibit C - Stockholders' Agreement dated October 8,
1992, among Leonard Bennett, Stephen Russell,
the Corporation and Hanseatic Corporation, as
amended by Amendment No. 1 dated July 3, 1996
Exhibit D - Registration Rights Agreement dated October
8, 1992 between the Corporation and Hanseatic
Corporation
<PAGE>
<PAGE>
SIGNATURE
---------
After reasonable inquiry and to the best of our knowledge and
belief, we certify that the information set forth in this statement
is true, complete and correct.
Dated: July 12, 1996 HANSEATIC CORPORATION
By s/Paul A. Biddelman
----------------------------
Paul A. Biddelman, Treasurer
Dated: July 12, 1996 s/Wolfgang Traber
---------------------------
Wolfgang Traber
Dated: July 12, 1996 s/Paul A. Biddelman
----------------------------
Paul A. Biddelman
<PAGE>
<PAGE>
INDEX TO EXHIBITS
Exhibit A - Agreement pursuant to Rule 13d-1(f)(iii)
Exhibit B - Stock Purchase Agreement dated July 3, 1996
among Leonard Bennett, Peter Bennett, Stephen
Russell and Hanseatic Corporation
Exhibit C - Stockholders' Agreement dated October 8, 1992,
among Leonard Bennett, Stephen Russell, the
Corporation and Hanseatic Corporation, as
amended by Amendment No. 1 dated July 3, 1996
Exhibit D - Registration Rights Agreement dated October 8,
1992 between the Corporation and Hanseatic
Corporation
<PAGE>
<PAGE>
<TABLE> Annex 1
<CAPTION>
Principal
Name and Occupation,
Business or Relationship Employer and
Residence to Address of
Address Citizenship Stockholder Employer
<S> <C> <C> <C>
Fernando Montero Peru President and President
Grand Bay Plaza Director Hanseatic
Corporation
2665 S. Bayshore Drive Grand Bay
Plaza
Suite 1101 2665 S.
Bayshore Drive
Coconut Grove, FL 33133 Suite 1101
Coconut
Grove, FL
33133
Gustav zu Salm-Horstmar Germany Director Director
Bank von Ernst Bank von
Ernst
& Co., Ltd. & Co., Ltd.
86 Jermyn Street 86 Jermyn
Street
London SW1 London SW1
Karl-Erbo Kageneck Germany Director Attorney
King & Spaulding King &
Spaulding
120 West 45th Street 120 West
45th Street
New York, NY 10036 New York, NY
10036
Paul A. Biddelman United States Treasurer Treasurer
Hanseatic Corporation Hanseatic
Corporation
450 Park Avenue 450 Park
Avenue
Suite 2302 Suite 2302
New York, NY 10022 New York, NY
10022
Benjamin Schliemann Germany Vice President Vice
President
Hanseatic Corporation Hanseatic
Corporation
450 Park Avenue 450 Park
Avenue
Suite 2302 Suite 2302
New York, NY 10022 New York, NY
10022
Wolfgang Traber Germany Principal Private
Investor
Hanseatic Corporation Stockholder Hanseatic
Corporation
450 Park Avenue 450 Park
Avenue
Suite 2302 Suite 2302
New York, NY 10022 New York, NY
10022
</TABLE>
EXHIBIT A
Pursuant to Rule 13d-1(f)(l)(iii) promulgated by the
Securities and Exchange Commission, the undersigned agree that the
statement to which this Exhibit is attached is filed on their
behalf and in the capacities set out herein below.
Dated: July 12, 1996 HANSEATIC CORPORATION
By s/Paul A. Biddelman
---------------------------
Paul A. Biddelman, Treasurer
Dated: July 12, 1996
s/Wolfgang Traber
-------------------------
Wolfgang Traber
Dated: July 12, 1996 s/Paul A. Biddelman
-----------------------------
Paul A. Biddelman
EXHIBIT B
STOCK PURCHASE AGREEMENT
STOCK PURCHASE AGREEMENT dated as of July 3, 1996 (this
"Agreement"), by and among Leonard R. Bennett and Peter Bennett
(individually, a "Seller" and collectively, the "Sellers"), on
the one hand, and Stephen Russell ("Russell"), and Hanseatic
Corporation, a New York corporation ("Hanseatic"), on the other
hand. Russell and Hanseatic are sometimes referred to herein
individually as a "Purchaser" and collectively as the
"Purchasers."
W I T N E S S E T H:
WHEREAS, each Seller is the beneficial owner of the number
of shares of common stock, par value $0.033 per share (the
"Common Stock"), of Celadon Group, Inc., a Delaware corporation
("Celadon"), set forth opposite his name on Schedule A attached
hereto (collectively, the "Shares"); and
WHEREAS, Sellers wish to sell to Purchasers and Purchasers,
in their individual capacity and as agent, wish to purchase from
Sellers, the Shares for the Purchase Price (as hereinafter
defined), upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the foregoing and of the
representations, warranties and agreements contained herein, and
intending to be legally bound hereby, the parties hereto agree as
follows:
ARTICLE I.
PURCHASE AND SALE OF THE SHARES
SECTION A. Purchase and Sale of the Shares. On the
terms and subject to the conditions contained herein, each Seller
herewith sells, assigns, conveys, transfers and delivers to each
Purchaser and each Purchaser, in its individual capacity and as
agent, herewith purchases, acquires and accepts from each Seller,
the number of Shares set forth opposite the name of such
Purchaser on Schedule B attached hereto for the consideration set
forth in Section 1.2 hereof.
SECTION B. Purchase Price. As consideration for
the sale, assignment, conveyance, transfer and delivery of the
Shares, each Purchaser herewith delivers, or shall herewith cause
to be delivered, to Sellers, in the manner hereinafter set forth,
the amount in cash set forth opposite the name of such Purchaser
on Schedule B attached hereto (in the aggregate, the "Purchase
Price").
<PAGE>
ARTICLE II.
ACKNOWLEDGEMENTS AND RELEASES
SECTION A. Acknowledgements and Release by
Purchasers. Each Purchaser (a) acknowledges that prior to the date
hereof Leonard R. Bennett has served as a member of the Board of
Directors, the President, the Chief Operating Officer and an
employee of Celadon and he is currently a principal stockholder
of Celadon and as such may be in possession of material, non-
public information concerning Celadon and the Common Stock; and
(b) unconditionally releases and discharges each Seller and each
of his heirs, successors, assigns, administrators, personal and
legal representatives and estate from any and all actions, causes
of action, suits, debts, sums of money, covenants, controversies,
agreements, promises, damages, judgments, executions, claims,
demands, obligations, rights, duties and liabilities whatsoever,
in law or in equity, which such Purchaser ever had, now has, or
hereafter can, shall or may have, whether known or unknown, for,
upon or by reason of any matter, cause or thing whatsoever,
arising out of, related to or in connection with the transactions
contemplated by this Agreement, other than in connection with a
breach of the representations and warranties contained in Article
V hereof.
SECTION B. Acknowledgements and Release by Sellers.
Each Seller (a) acknowledges that Russell is a member of and
Chairman of the Board of Directors, the Chief Executive Officer
and an employee of Celadon, and that each Purchaser is currently
a principal stockholder of Celadon and as such may be in
possession of material, non-public information concerning Celadon
and the Common Stock; and (b) unconditionally releases and
discharges each Purchaser and his or its heirs, successors,
assigns, administrators, personal and legal representatives and
estate from any and all actions, causes of action, suits, debts,
sums of money, covenants, controversies, agreements, promises,
damages, judgments, executions, claims, demands, obligations,
rights, duties and liabilities whatsoever, in law or in equity,
which such Seller ever had, now has or hereafter can, shall, or
may have, whether known or unknown, for, upon, or by reason of
any matter, cause or thing whatsoever, arising out of, related to
or in connection with the transactions contemplated by this
Agreement, other than in connection with a breach of the
representations and warranties contained in Article IV hereof or
the obligations in the last sentence of Section 7.9 hereof.
ARTICLE III.
THE CLOSING
SECTION A. The Closing. 1. The sale, assignment,
conveyance, transfer and delivery of the Shares in exchange for
the Purchase Price shall take place concurrently with the
<PAGE>
execution and delivery of this Agreement by the parties hereto,
at the offices of Krugman, Chapnick & Grimshaw, Park 80 West -
Plaza Two, Saddle Brook, New Jersey 07663-5835 (the "Closing").
The date and time of the Closing is referred to herein as the
"Closing Date." On the Closing Date the Purchasers are herewith
delivering the Purchase Price to Sellers by wire transfer of
immediately available funds to a bank account designated by
Sellers prior to the Closing Date.
2. As soon as practicable but no later than two
weeks after the Closing Date, each Seller shall deliver to each
Purchaser at the offices of Krugman, Chapnick & Grimshaw, Park 80
West - Plaza Two, Saddle Brook, New Jersey 07663-5835, a stock
certificate or stock certificates representing the aggregate
number of Shares purchased by such Purchaser pursuant to this
Agreement, accompanied by a stock power or stock powers executed
in blank and any other documents that are necessary to transfer
title to the Shares purchased pursuant hereto.
ARTICLE IV.
REPRESENTATIONS AND WARRANTIES
OF PURCHASERS
SECTION A. Each Purchaser hereby severally, but not
jointly, represents and warrants to each Seller as follows:
1. The execution, delivery and performance by such
Purchaser of this Agreement, the consummation of the transactions
contemplated hereby and compliance by such Purchaser with any of
the provisions hereof will not conflict with, constitute a
default under, violate or otherwise constitute a breach (with or
without the giving of notice or the lapse of time or both) of
(i) any statute or law or any judgment, decree, order, regulation
or rule of any court or governmental authority binding on such
Purchaser of which such Purchaser is aware, or (ii) any contract
to which such Purchaser is a party;
2. This Agreement constitutes the legal, valid and
binding obligation of such Purchaser, enforceable against him or
it in accordance with its terms, subject to applicable
bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium and similar laws affecting creditors' rights and
remedies generally and subject, as to enforceability, to general
principles of equity, including principles of commercial
reasonableness, good faith and fair dealing (regardless of
whether enforcement is sought in a proceeding at law or in
equity); and
3. At the date of execution of this Agreement,
there is no pending action or proceeding to which such Purchaser is
a party, or, to the knowledge of such Purchaser, any other pending
or threatened action or proceeding, before any court,
<PAGE>
governmental agency or arbitrator, which seeks to enjoin the
transactions contemplated by this Agreement;
4. Such Purchaser understands and agrees that the
Shares he or it is acquiring pursuant to the terms hereof have
not been registered under the Securities Act of 1933, as amended
(the "Securities Act"), and that accordingly such Shares will not
be fully transferable except as permitted under various
exemptions contained in the Securities Act, or upon satisfaction
of the registration and prospectus delivery requirements of the
Securities Act;
5. Such Purchaser is either (i) an "accredited
investor" within the meaning of Rule 501 of Regulation D
promulgated under the Securities Act, or (ii) has such knowledge
and experience in financial and business matters that he or it is
capable of evaluating and has evaluated the merits and the
economic and other risks involved in an investment in the Shares,
and he or it is solely responsible for making his or its own
independent decision with respect to such investment; and
6. Such Purchaser is acquiring the Shares solely
(i) for his or its own account, for investment purposes only and
not with a view towards distributing or reselling such Shares or
any part thereof, or interest therein, in any transaction that
would be in violation of the securities laws of the United States
of America or any State thereof, or (ii) as agent directly or
indirectly for other persons or entities and in connection
therewith such Purchaser hereby represents and warrants to each
Seller with respect to the matters set forth in Sections 4.1(d),
(e) and (f) hereof with respect to each such other person or
entity.
ARTICLE V.
REPRESENTATIONS AND WARRANTIES
OF SELLERS
SECTION A. Each Seller hereby severally, but not
jointly, represents and warrants to each Purchaser as follows:
1. Subject to the receipt of the waivers, consents
and other documents set forth on Schedule C hereto, the
execution, delivery and performance by such Seller of this
Agreement, the consummation of the transactions contemplated
hereby and compliance by such Seller with any of the provisions
hereof will not conflict with, constitute a default under,
violate or otherwise constitute a breach (with or without the
giving of notice or the lapse of time or both) of (i) any statute
or law or any judgment, decree, order, regulation or rule of any
court or governmental authority binding on such Seller of which
such Seller is aware, or (ii) any contract to which such Seller
is a party;
<PAGE>
2. This Agreement constitutes the legal, valid and
binding obligation of such Seller, enforceable against him in
accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium and
similar laws affecting creditors' rights and remedies generally
and subject, as to enforceability, to general principles of
equity, including principles of commercial reasonableness, good
faith and fair dealing (regardless of whether enforcement is
sought in a proceeding at law or in equity);
3. The shares of Common Stock set forth opposite
the name of such Seller on Schedule A attached hereto are owned of
record and are beneficially owned by such Seller, and upon
delivery of the Shares pursuant to the terms hereof against
payment therefor in accordance with the terms hereof and subject
to the receipt of the waivers, consents and other documents set
forth on Schedule C hereto, such Seller will have transferred to
the appropriate Purchaser good and valid title to such shares,
free and clear of any and all liens, pledges, charges,
limitations on voting rights, options, security interests or
other encumbrances or claims of any kind whatsoever;
4. In reliance upon the representations and
warranties of each Purchaser set forth in Section 4.1 hereof, the
offer and sale of the shares of Common Stock allocated to such
Purchaser pursuant to the terms hereof is exempt from the
registration and prospectus delivery requirements of Section 5 of
the Securities Act; and
5. At the date of execution of this Agreement,
there is no pending action or proceeding to which such Seller is a
party, or, to the knowledge of such Seller, any other pending or
threatened action or proceeding, before any court, governmental
agency or arbitrator, which seeks to enjoin the transactions
contemplated by this Agreement.
ARTICLE VI.
LEGEND ON SHARES OF COMMON STOCK
SECTION A. Legend on the Shares of Common Stock.
Upon the delivery thereof to Purchasers pursuant to the terms
hereof, and until such time as the same is no longer required under
the applicable requirements of the Securities Act, the certificates
representing the Shares purchased pursuant to this Agreement (and
all securities issued in exchange therefor or in substitution
thereof) shall bear the following legend:
"THE SECURITIES REPRESENTED BY THIS
CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED. THEY
MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE
OF AN EFFECTIVE REGISTRATION STATEMENT UNDER
SUCH ACT OR AN APPLICABLE EXEMPTION THEREFROM."
<PAGE>
ARTICLE VII.
MISCELLANEOUS
SECTION A. Notices. Any notices or other
communications
required or permitted hereunder, shall be sufficiently given if
in writing and personally delivered, sent by registered or
certified mail, postage prepaid, return receipt requested or sent
by a nationally recognized overnight courier service address as
follows:
in the case of Sellers, to:
Mr. Leonard R. Bennett
2526 N.W. 59th Street
Boca Raton, Florida 33496
Mr. Peter Bennett
11636 Bradford Place
Carmel, Indiana 46033
with a copy to:
Akin, Gump, Strauss, Hauer & Feld, L.L.P.
399 Park Avenue
New York, New York 10022
Attention: Robert G. Koen, Esq.
in the case of each Purchaser, to the address
for such Purchaser set forth on Schedule A attached hereto;
or to such other person or address as any party shall specify by
notice in writing to the other parties hereto.
SECTION B. No Waivers; Amendments.
1. No failure or delay on the part of any 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 at law.
2. Any provision of this Agreement may be amended
or waived if, but only if, such amendment or waiver is in writing
and is signed by all the parties hereto.
SECTION C. Survival of Provisions. The parties
hereto hereby acknowledge and agree that the provisions of Article
II and the representations, warranties and covenants contained in
this Agreement shall survive beyond the date hereof and any
investigation at any time made by or on behalf of any of the
parties hereto.
<PAGE>
SECTION D. Binding Effect; Assignment. This
Agreement and all of the provisions hereof shall be binding upon
and shall inure to the benefit of the parties hereto and his or its
successors, assigns, heirs, personal representatives and estate.
SECTION E. Governing Law. This Agreement shall be
governed by, construed and enforced in accordance with the laws
of the State of New York, without regard to the principles
thereof relating to conflict of laws.
SECTION F. Counterparts; Effectiveness. This
Agreement may be executed in any number of counterparts, each of
which shall be an original with the same effect as if the
signatures thereto and hereto were upon the same instrument, and
all of which, when taken together, shall constitute the same
instrument.
SECTION G. Entire Agreement. This Agreement
constitutes the entire agreement and understanding among the
parties hereto and supersedes any and all prior agreements and
understandings, written or oral, relating to the subject matter
hereof.
SECTION H. Further Assurances. The parties hereto
each agree to execute and deliver such other documents, instruments
or agreements and to take such other action as may be necessary or
desirable for the implementation of this Agreement and the
consummation of the transactions contemplated hereby.
SECTION I. Expenses; Transfer Taxes. Whether or
not the transactions contemplated hereby are consummated, the
parties hereto shall pay their own respective expenses, including,
without limitation, all fees and expenses of legal counsel and
other advisors of such party, in connection with the negotiation
and preparation of this Agreement and the consummation of the
transactions contemplated hereby. Any and all sales, transfer,
stamp, documentary and other similar taxes arising out of the
transfer of the shares of Common Stock allocated to each
Purchaser pursuant to the terms hereof shall be borne entirely by
such Purchaser and such Purchaser shall indemnify each Seller
from and against any liabilities or expenses, including, without
limitation, reasonable attorneys' fees and expenses, arising in
connection therewith.
IN WITNESS WHEREOF, each of the parties hereto has duly
executed and delivered this Agreement as of the date first above
written.
s/Leonard R. Bennett
-------------------------------------
Leonard R. Bennett
s/Peter Bennett
-------------------------------------
Peter Bennett
<PAGE>
s/Stephen Russell
-------------------------------------
Stephen Russell
HANSEATIC CORPORATION
By: s/Paul A. Biddelman
--------------------------------
Paul A. Biddelman
Treasurer<PAGE>
<PAGE>
SCHEDULE A
<TABLE>
<CAPTION>
No. of Shares
Name of Seller Being Sold by Such Seller
- -------------- -------------------------
<S> <C>
Leonard R. Bennett 813,314
Peter Bennett 40,000
/TABLE
<PAGE>
<PAGE>
<TABLE>
SCHEDULE B
<CAPTION>
No. of Shares No. of Shares
Aggregate
Name and Address Being Purchased Being Purchased
Purchase Price
of Purchaser from Leonard Bennett from Peter
Bennett for Such Shares
- ----------------- --------------------
- ------------------ ---------------
<S> <C> <C>
<C>
Mr. Stephen Russell
21 Cherry Valley Road
Greenwich, CT 08631 75,000 ---
$ 675,000.00
Hanseatic Corporation
450 Park Avenue
New York, NY 10022
Attention: Paul A.
Biddelman 738,314 40,000
$7,004,826.00
-------------
$7,679,826.00
=============
/TABLE
<PAGE>
<PAGE>
SCHEDULE C
WAIVERS, CONSENTS AND DOCUMENTS
1. Amendment to Stockholder's Agreement, of
even
date herewith among Celadon, Russell,
Leonard
R. Bennett and Hanseatic.
2. Termination of Agreements, of even date
herewith among Celadon, Russell and
Leonard
R. Bennett.
<PAGE> EXHIBIT C
STOCKHOLDERS AGREEMENT
AGREEMENT dated as of October 8, 1992 by and among CELADON
GROUP, INC., a corporation duly organized and validly existing
under the laws of the State of Delaware (hereinafter referred to as
the "Corporation"); STEPHEN RUSSELL, whose mailing address is c/o
the Corporation, 888 Seventh Avenue, New York, New York 10106
(hereinafter referred to as "Russell"); LEONARD R. BENNETT, whose
mailing address is c/o the Corporation, 888 Seventh Avenue, New
York, New York 10106 (hereinafter, together with Russell, referred
to as the "Stockholders"); and HANSEATIC CORPORATION, a corporation
duly organized and validly existing under the laws of the State of
New York (hereinafter referred to as the "Purchaser").
W I T N E S S E T H :
WHEREAS, the Stockholders are the principal stockholders of
the Corporation, together owning in excess of a majority of the
issued and outstanding shares of the common stock, $.01 par value
(hereinafter referred to as the "Common Stock"), of the
Corporation; and
WHEREAS, the Corporation and the Purchaser are parties to a
Convertible Note Purchase Agreement dated as of September 16, 1992
(hereinafter referred to as the "Purchase Agreement"), providing,
among other matters, for the issuance and delivery by the
Corporation to the Purchaser of the Corporation's 9.25% Senior
Subordinated Convertible Note dated this date (hereinafter referred
to as the "Note") in the aggregate principal amount of $8,000,000,
convertible into 2,436,796 shares of Common Stock, and its Warrants
dated this date (hereinafter referred to as the "Warrants")
exercisable with respect to 40,000 shares of Common Stock; and
WHEREAS, it is a condition to the acquisition and acceptance
by the Purchaser of the Note and the Warrants that the Corporation
and the Stockholders execute and deliver this Agreement to the
Purchaser;
NOW, THEREFORE, in consideration of the premises and the
covenants and agreements herein contained the parties hereto hereby
agree as follows:
ARTICLE I
BOARD OF DIRECTORS
The Corporation shall use its best efforts take all such
action as may be necessary so that its Board of Directors shall,
from and after the date hereof and until the Expiration Date (as
hereinafter defined), at all times include one member who shall be
selected by the Purchaser and reasonably satisfactory to the Cor-
poration (and any successor or successors to such member who shall
be selected by the Purchaser and reasonably satisfactory to the
<PAGE>
Corporation), including, without limitation the expansion of the
size of the current Board of Directors to include such designee
(and any such successor or successors) and the nomination and
recommendation for election and re-election, as the case may be, of
such designee (and any such successor or successors); and the
Stockholders, and each of them, agree that they will vote all
shares of Common Stock owned by them, respectively, in favor of a
Board of Directors that shall include such designee (and any such
successor or successors), and take all such other action as may be
necessary so that the Board of Directors of the Corporation shall
be constituted as aforesaid. From and after the date hereof and
until the Expiration Date, the Purchaser agrees that it will vote
all shares of Common Stock owned by it in favor of a Board of
Directors that shall include the Stockholders, and each of them;
provided, however, that, in the event of the death of either
Stockholder, the foregoing commitment contained in this sentence
shall extend to such person (reasonably satisfactory to the
Purchaser) as shall be selected by the holder or holders of a
majority of shares of Common Stock held by such Stockholder on the
date hereof, and any successor or successors to such member
(reasonably satisfactory to the Purchaser), unless the Purchaser
shall be reasonably uncertain as to the identity of such holder or
holders. For purposes hereof, the "Expiration Date" shall mean the
date on which the Purchaser owns, or has rights to obtain (by
conversion of the Note and/or exercise of the Warrants and/or
otherwise), in the aggregate fewer than 1,624,531 shares of Common
Stock (such number of shares subject to appropriate adjustment for
stock splits, stock dividends and recapitalizations of the
Corporation).
ARTICLE II
SALE OF COMMON STOCK
A. The Stockholders, and each of them, agree that no shares
of Common Stock held thereby shall be sold, assigned, transferred,
pledged, hypothecated or otherwise disposed of, whether voluntarily
or by operation of law (including transfers by will or intestate
succession), except as specifically provided under this Article II.
Any purported disposition of shares of Common Stock in violation of
this Agreement shall be void.
B. For purposes of this Agreement: (i) the term "Sale" shall
mean (x) any voluntary transfer of shares of Common Stock for
value, or (y) any transaction subject to the provisions of the
Prior Stockholders Agreements (as hereinafter defined), or any of
them; (ii) the term "Exempt Transaction" shall mean any Stockholder
Sale or any transfer without consideration (including, without
limitation, a transfer by gift, by will or the laws of descent or
distribution), or any transfer by operation of law (including,
without limitation, a statutory merger, consolidation or
recapitalization); (iii) the term "Exempt Sale" shall mean any open
market sale, subsequent to the Initial Public Offering Date (as
<PAGE>
hereinafter defined), effectuated in accordance with the provisions
of Rule 144 promulgated by the Securities and Exchange Commission,
or any successor to such rule; (iv) the term "Initial Public
Offering Date" shall mean the date of delivery of the first shares
of Common Stock sold to the public for cash through underwriters by
means of a registration statement under the Securities Act of 1933,
as amended (other than a registration statement on Form S-8 or
equivalent form); and (v) the term "Stockholder Sale" shall mean
any Sale by one Stockholder to another Stockholder (unless subject
to the provisions of the Prior Stockholders Agreements, or any of
them).
C. In the event of Exempt Transaction, the transferee shall
be bound by the terms of this Agreement as if it were the
Stockholder from which the shares in such transfer were acquired;
and, if the transfer is made by operation of law pursuant to a
statutory merger, consolidation, recapitalization or similar
transaction, then all the provisions of this Agreement shall
continue to apply to the shares issued in exchange for the shares
subject to the provisions of this Agreement.
D. Without limiting in any manner the rights of the
Purchaser set forth under Paragraph F of this Article II, if one or
both of the Stockholders desires, directly or indirectly, to
effectuate a Sale of any shares of Common Stock (including, without
limitation, in any transaction or transactions subject to the
provisions of the Prior Stockholders Agreements, or any of them,
but other than an Exempt Sale or a Stockholder Sale), such
Stockholder or Stockholders shall deliver written notice
(hereinafter referred to as the "Sale Notice") of such intention to
the Purchaser not less than 60 days prior to the consummation of
such transaction, which shall set forth with reasonable
specificity:
(i) the name, address and principal business activity
of the prospective purchaser (which may be an Eligible
Stockholder (as hereinafter defined));
(ii) the number of shares of Common Stock proposed to be
sold;
(iii) the manner in which the Sale is proposed to be
made;
(iv) the price at which or other consideration for
which, and the material terms upon which, the Sale is proposed
to be made; and
(v) the date, time and place of such scheduled closing,
if known.
<PAGE>
The Stockholder or Stockholders delivering such Sale Notice shall
also furnish to the Purchaser written evidence of any offer from
any prospective purchaser together with the terms thereof, and with
such additional information as the Purchaser may reasonably
request.
E. Upon receipt of a Sale Notice, the Purchaser, and any
direct or indirect transferee (hereinafter referred to as an
"Eligible Transferee") of shares of Common Stock issued by the
Corporation to the Purchaser or of the Note or the Warrants, or any
interest therein (other than a transferee who obtained such shares
pursuant to a sale [within the meaning of Section 5 of the
Securities Act of 1933, as amended] (x) effectuated in an open
market transaction in accordance with the provisions of Rule 144
promulgated by the Securities and Exchange Commission, or any
successor to such rule, or (y) otherwise constituting a public
offering), shall have the right (hereinafter referred to as the
"Sale Option") to require the inclusion in the Sale covered by such
Sale Notice, on terms and conditions no less favorable than those
afforded to the Stockholder or Stockholders delivering the Sale
Notice:
(i) in the event the Sale Notice shall pertain to
a controlling interest in the Corporation (which shall be
defined as an interest that entails, directly or indirectly,
the power to direct or cause the direction of the management
and policies of the Corporation), all or any part of the
shares of Common Stock owned by the Purchaser and/or any
Eligible Transferee or issuable upon conversion of the Note or
exercise of the Warrants; or
(ii) in the event the Sale Notice shall not pertain
to a controlling interest in the Corporation as aforesaid, all
or any part of such number of shares of Common Stock owned by
the Purchaser and/or any Eligible Transferee or issuable upon
conversion of the Note or exercise of the Warrants equal to
the product obtained by multiplying: (x) the aggregate number
of shares covered by the Sale Notice by (y) a fraction, the
numerator of which shall be the number of shares of Common
Stock owned by the Purchaser and/or any Eligible Transferee
participating in such Sale Note or issuable upon conversion of
the Note or exercise of the Warrants (to the extent issuable
to the Purchaser and/or any such Eligible Transferee) and the
denominator of which shall be the sum of the numerator and the
number of shares of Common Stock then owned by the Stockholder
or Stockholders delivering the Sale Notice.
In the event of a proposed Sale pursuant to this Paragraph E, the
parties shall use their best efforts and shall cooperate with one
another to facilitate the Sale and to maximize the price to be
obtained upon the Sale, including the execution and delivery of all
required documents and instruments. Without limiting the
generality of the foregoing, and in view of their obligations under
the Prior Stockholders Agreements, and each of them, the
<PAGE>
Stockholders, and each of them, shall ensure that any Sale or
proposed Sale (including, without limitation, any Sale or proposed
Sale under Sections 3, 4 or 5 of the Citicorp Stockholder Agreement
[as hereinafter defined] in all respects is in accordance with the
terms and provisions of this Agreement and the Prior Stockholders
Agreements, and each of them, and is effective to discharge the
obligations of the Stockholders, and each of them, hereunder and
under the Prior Stockholders Agreements, and each of them.
F. Alternatively, upon receipt of a Sale Notice, the
Purchaser shall have the right (hereinafter referred to as the
"Purchase Option"), but subject to any rights and options granted
under the Citicorp Stockholder Agreement to Eligible Stockholders
(as defined thereunder), to purchase all, but not less than all,
shares of Common Stock specified in the Sale Notice at the price
per share equal to the dollar value of the consideration per share
set forth in the Sale Notice. In the event that such consideration
consists, in whole or in part, of securities or other property, the
dollar value thereof shall be the fair market value thereof on the
date of the applicable Sale Notice, as the Stockholder or
Stockholders delivering such Sale Notice and the Purchaser shall
mutually agree, or, if such parties shall not forthwith agree
thereon, pursuant to procedures substantially similar to those set
forth under Paragraph (b) of Section 7.2 of the Purchase Agreement.
G. Each Sale Option may be exercised by the Purchaser (or
any Eligible Transferee, as the case may be) by giving written
notice of exercise to the Stockholder or Stockholders delivering
the Sale Notice within 30 days after the later of receipt of the
Sale Notice or completion of the determination contemplated by the
final sentence of Paragraph F immediately preceding; and each
Purchase Option may be exercised by the Purchaser by giving written
notice of exercise to the Stockholder or Stockholders delivering
the Sale Notice within 30 days of the latest of receipt of the Sale
Notice or completion of the determination contemplated by the final
sentence of Paragraph F immediately preceding or the expiration of
the aforesaid rights of the Eligible Stockholders. Upon receipt of
such notice of exercise of the Purchase Option, the Stockholder or
Stockholders delivering the Sale Notice shall forthwith, and in any
event within 30 days, deliver to the Purchaser the certificates
representing the shares to be purchased by the Purchaser and
thereupon the Purchaser shall pay such Stockholder or Stockholders
cash in the amount of the purchase price therefor. If the
Purchaser shall not have exercised either such right and option
within the time provided therefor, the Stockholder or Stockholders
delivering the Sale Notice shall thereafter be free to effect the
Sale specified in the Sale Notice, but only to the person or
persons specified in the Sale Notice and in the manner and at the
time specified in the Sale Notice and at the offer price or for the
consideration and on the terms specified in the Sale Notice. If
the Sale with respect to which the Sale Notice is given does not
occur within the period specified therein (but no later than 120
days after the date of the Sale Notice), the shares of Common Stock
<PAGE>
proposed to be sold will again be subject to the notice and other
provisions of this Article II.
H. Without limiting any other provision herein, all the
provisions of this Agreement shall apply to all shares of Common
Stock now owned by the Stockholders, or each of them, or which may
be issued hereafter to the Stockholders, or each of them, whether
as a result of any purchase, exchange or reclassification of such
stock, corporate reorganization or any other form of
recapitalization, consolidation, merger, stock split or stock
dividend, or which are acquired by the Stockholders, or each of
them, in any other manner.
I. Each stock certificate representing shares of the
Stockholders, or either of them, subject hereto shall contain upon
its face or upon the reverse side thereof a legend to the following
effect:
"This stock certificate represents shares
which are subject to the terms and conditions
of a Stockholders Agreement dated as of
October 8, 1992 (a copy of which is on file at
the principal office of the Corporation), and
no sale, assignment, transfer, pledge,
hypothecation or other disposition of such
shares or any interest therein shall be made
except in compliance with the terms and
conditions of said Agreement."
ARTICLE III
REPRESENTATIONS AND WARRANTIES
OF THE STOCKHOLDERS
Each Stockholder hereby represents, warrants and covenants,
severally but not jointly, that:
A. When executed and delivered by such Stockholder, this
Agreement shall constitute the valid and legally binding
obligations of such Stockholder enforceable against such
Stockholder in accordance with its terms, except as may be limited
by bankruptcy, insolvency, reorganization, arrangement, moratorium
or other laws relating to or affecting the rights of creditors
generally and by equitable principles of general applicability.
B. Neither the execution and delivery of this Agreement, nor
the consummation of the transactions contemplated herein, will
violate any law, rule, regulation, writ, judgment, injunction,
decree, determination, award or other order of any court,
government, or governmental agency or instrumentality, domestic or
foreign, binding upon such Stockholder, or conflict with or result
in any breach of or event of termination under any of the terms of,
<PAGE>
or the creation or imposition of any mortgage, deed of trust,
pledge, lien, security interest or other charge or encumbrance of
any nature pursuant to, the terms of any contract or agreement to
which such Stockholder is a party or by which such Stockholder or
any of his properties or assets is bound.
C. Such Stockholder owns the number of shares of Common
Stock set forth on Schedule II-3 to the Purchase Agreement free and
clear of any mortgage, deed of trust, pledge, lien, security
interest or other charge or encumbrance of any nature, except for:
(i) the Shareholders Agreement dated as of October 6, 1986 among
the Corporation and each of the Stockholders; (ii) the
Stockholders' Agreement dated as of April 7, 1988 (herein referred
to as the "Citicorp Stockholders Agreement") among the Corporation,
the Stockholders parties thereto and Citicorp Ventures Capital
Ltd.; and (iii) the Co-Sale Agreement dated June 28, 1991 among the
Corporation, each of the Stockholders and Compagnie Generale
Calberson (the agreements under clauses (i), (ii) and (iii)
immediately preceding herein referred to, collectively, as the
"Prior Stockholders Agreements"). Such Stockholder shall not
create any further charge or encumbrance of any nature on any
shares subject to sale to the Purchaser hereunder that shall not
expire upon such sale.
ARTICLE IV
MISCELLANEOUS
A. All notices, requests or instructions hereunder shall be
in writing and delivered personally or sent by registered or
certified mail, postage prepaid, or by telecopy (or like
transmission), as follows:
(1) if to the Corporation or either Stockholder:
888 Seventh Avenue
New York, New York 10106
Telecopy Number: (212) 315-5281
with a copy to:
Arnold S. Jacobs, Esq.
Shea & Gould
1251 Avenue of the Americas
New York, New York 10020-1193
Telecopy Number: (212) 840-6702
<PAGE>
(2) if to the Purchaser:
375 Park Avenue
New York, New York 10152
Telecopy Number: (212) 223-2425
with a copy to:
Howard Kailes, Esq
Krugman, Chapnick & Grimshaw
Park 80 West - Plaza Two
Saddle Brook, New Jersey 07662
Telecopy Number: (201) 845-9627
Any notice so addressed and mailed shall be deemed to be given when
so mailed. Any notice so addressed and otherwise delivered shall
be deemed to be given when actually received by the addressee. Any
of the above addresses may be changed at any time by notice given
as provided above; provided, however, that any such notice of
change of address shall be effective only upon receipt. The
Stockholders, and each of them, hereby agree that copies of each
and every notice, request or instruction delivered to them, or
either of them, under the Prior Stockholders Agreements, or any of
them, shall promptly be delivered to the Purchaser.
B. This Agreement and the documents referred to herein
contain the entire agreement between the parties hereto with
respect to the transactions contemplated hereby, and supersede all
prior understandings, arrangements and agreements with respect to
the subject matter hereof. No modification hereof shall be
effective unless in writing and signed by the party against which
it is sought to be enforced.
C. Each of the parties hereto shall use such party's best
efforts to take such actions as may be necessary or reasonably
requested by the other parties hereto to carry out and consummate
the transactions contemplated by this Agreement.
D. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and
assigns.
E. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York applicable in the
case of agreements made and to be performed entirely within such
State.
F. The captions appearing herein are for the convenience of
the parties only and shall not be construed to affect the meaning
of the provisions of this Agreement.
<PAGE>
G. This Agreement may be executed in counterparts, each of
which shall be deemed an original, but all of which taken together
shall constitute one and the same instrument.
IN WITNESS WHEREOF, this Agreement has duly executed by the
parties hereto as of the date first above written.
ATTEST: CELADON GROUP, INC.
s/Richard Goldberg By s/Stephen Russell
- -------------------------- -------------------------------
Secretary Chairman
ATTEST: HANSEATIC CORPORATION
s/Elizabeth M. Parella By s/Paul A. Biddelman
- --------------------------- -------------------------------
Secretary Treasurer
WITNESS:
s/Richard Goldberg s/Stephen Russell
- --------------------------- --------------------------------
Stephen Russell
WITNESS:
s/Richard Goldberg s/Leonard R. Bennett
- --------------------------- --------------------------------
Leonard R. Bennett
<PAGE>
<PAGE>
AMENDMENT
TO
STOCKHOLDERS AGREEMENT
This Amendment to Stockholders Agreement (this "Amendment"),
is entered into as of this 3rd day of July, 1996, by and among
Celadon Group, Inc., a Delaware corporation ("Company"), Leonard
R. Bennett ("Bennett"), Stephen Russell ("Russell"), and
Hanseatic Corporation, a New York corporation ("Hanseatic").
W I T N E S S E T H:
WHEREAS, the Company, Bennett, Russell and Hanseatic are
parties to that certain Stockholders Agreement, dated as of
October 8, 1992 (the "Stockholders Agreement");
WHEREAS, Bennett is entering into a Stock Purchase
Agreement, dated of even date herewith (the "Stock Purchase
Agreement"), with Peter Bennett, Russell, individually and as
agent, and Hanseatic, individually and as agent; and
WHEREAS, it is a condition to the consummation of the
transactions contemplated by the Stock Purchase Agreement that
Bennett, the Company, Russell and Hanseatic enter into this
Amendment, upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, in furtherance of the Stock Purchase
Agreement and the consummation of the transactions contemplated
thereby and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
SECTION 1. Capitalized terms used in this Amendment which
are not otherwise defined herein shall have the meanings given to
such terms in the Stockholders Agreement.
SECTION 2. The Stockholders Agreement shall be terminated
with respect to Bennett and the terms and provisions thereof
relating to Bennett shall be null and void and of no further
effect effective as of the date hereof. Effective as of the date
hereof, Bennett shall no longer be a party to the Stockholders
Agreement and all references to "Bennett" shall be deleted and
Bennett shall no longer be a Stockholder (as each term is defined
in the Stockholders Agreement) under the Stockholders Agreement.
SECTION 3. References. All references in the Stockholders
Agreement to "this Agreement" shall mean the Stockholders
Agreement as amended by this Amendment.
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SECTION 4. Amendments.
(a) From and after the date hereof, each and every
reference in the Stockholders Agreement to the "the Purchaser"
shall be deemed to be a reference to "Hanseatic".
(b) Article I of the Stockholders Agreement shall be
amended in its entirety to read as follows:
ARTICLE I
BOARD OF DIRECTORS
The Corporation shall use its best efforts to take all such
action as may be necessary so that its Board of Directors shall,
from and after the date hereof and until the Expiration Date (as
hereinafter defined), at all times include one member who shall
be selected by Russell and one member who shall be selected by
Hanseatic, each reasonably satisfactory to the Corporation (and
any successor or successors to each such member who shall be
reasonably satisfactory to the Corporation), including, without
limitation, the nomination and recommendation for election and
re-election, as the case may be, of such designees (and any such
successor or successors); and each of Russell and Hanseatic
agrees that he or it will vote all shares of Common Stock
beneficially owned by him or it in favor of a Board of Directors
that shall include such designees (and any such successor or
successors), and take all such other action as may be necessary
so that the Board of Directors of the Corporation shall be
constituted as aforesaid; provided, however, that in the event of
the death of Russell, the foregoing commitment contained in this
sentence shall extend to such person (reasonably satisfactory to
the Corporation) as shall be selected by the holder or holders of
a majority of the shares of Common Stock held by Russell on the
date hereof (reasonably satisfactory to the Corporation), unless
Hanseatic shall be reasonably uncertain as to the identity of
such holder or holders. For purposes hereof, the "Expiration
Date" shall mean the date on which either Russell or Hanseatic,
and their respective heirs, successors, personal or legal
representatives, and assigns, shall beneficially own less than
five per cent of the outstanding shares of Common Stock.
SECTION 5. Governing Law. This Amendment shall be governed
by, construed and enforced in accordance with the laws of the
State of New York, without regard to the principles thereof
relating to conflict of laws.
SECTION 6. Counterparts. This Amendment may be executed in
one or more counterparts, each of which shall be deemed an
original, and all of which shall constitute one and the same
instrument.
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SECTION 7. No Other Amendments. Except as expressly
amended hereby, the terms and conditions of the Stockholders
Agreement shall continue in full force and effect.
IN WITNESS WHEREOF, the parties have duly executed and
delivered this Amendment as of the date first written above.
CELADON GROUP, INC.
By: s/Stephen Russell
-----------------------------------
Name: Stephen Russell
Title: Chairman
HANSEATIC CORPORATION
By: s/Paul A. Biddelman
-----------------------------------
Name: Paul A. Biddelman
Title: Treasurer
s/Leonard Bennett
- --------------------------------------
Leonard Bennett
s/Stephen Russell
- --------------------------------------
Stephen Russell
EXHIBIT D
REGISTRATION RIGHTS AGREEMENT
Registration Rights Agreement dated as of October 8, 1992,
between Celadon Group, Inc., a corporation duly organized and
validly existing under the laws of the State of Delaware
(hereinafter referred to as the "Corporation") and Hanseatic
Corporation, a corporation duly organized and validly existing
under the laws of the State of New York (hereinafter referred to as
the "Purchaser").
W I T N E S S E T H :
WHEREAS, the Corporation and the Purchaser are parties to a
Convertible Note Purchase Agreement dated as of September 16, 1992
(hereinafter referred to as the "Purchase Agreement") providing
for, among other matters, the issuance and delivery by the
Corporation to the Purchaser of the Corporation's 9.25% Senior
Subordinated Convertible Note dated this date (hereinafter referred
to as the "Note") in the principal amount of $8,000,000,
convertible into 2,436,796 shares (hereinafter referred to as the
"Conversion Shares") of the common stock, $.01 par value (as the
same may be constituted from time to time hereinafter referred to
as the "Common Stock"), of the Corporation, and its Warrants dated
this date (hereinafter referred to as the "Warrants") exercisable
with respect to 40,000 shares (hereinafter referred to as the
"Warrant Shares" and, together with the Conversion Shares, the
"Purchaser Shares") of Common Stock; and
WHEREAS, it is a condition to the acquisition and acceptance
by the Purchaser of the Note and the Warrants that the Corporation
execute and deliver this Agreement to the Purchaser;
NOW, THEREFORE, in consideration of the premises and the
covenants and agreements herein contained the parties hereto hereby
agree as follows:
ARTICLE I
DEFINITIONS
As used in this Agreement, the following additional terms
shall have the following respective meanings:
The term "Demand Registration" shall have the meaning set
forth in Paragraph A of Article III hereof.
The term "Exchange Act" shall mean the Securities Exchange Act
of 1934, as amended from time to time.
The term "Incidental Registration" shall have the meaning set
forth in Paragraph B of Article IV.
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The term "Initial Public Offering Date" shall mean the date of
delivery of the first shares of Common Stock sold to the public for
cash through underwriters by means of a Registration Statement
(other than a Registration Statement on Form S-8 or equivalent
form).
The term "Person" shall mean an individual, partnership,
corporation, trust or unincorporated organization, or a government
or agency or political subdivision thereof.
The term "Principal Documents" shall have the meaning set
forth in the Purchase Agreement.
The term "Prospectus" shall mean the prospectus included in
any Registration Statement, as amended or supplemented by any
prospectus supplement with respect to the terms of the offering of
any portion of the Registrable Securities covered by the
Registration Statement and all other amendments and supplements to
the Prospectus, including post-effective amendments and all
material incorporated by reference in such Prospectus.
The term "Registration Expenses" shall have the meaning set
forth in Article VII.
The term "Registrable Securities" shall mean (i) the Purchaser
Shares, and (ii) any securities issued or issuable with respect to
the Purchaser Shares by way of a stock dividend or stock split or
in connection with a combination of shares, recapitalization,
merger, consolidation or other reorganization; provided, however,
that a security ceases to be a Registrable Security when it is no
longer a Restricted Security.
The term "Registration Statement" shall mean any registration
statement of the Corporation which covers Registrable Securities
pursuant to the provisions of this Agreement, including the
Prospectus, amendments (including post-effective amendments) and
supplements to such Registration Statement, all exhibits and all
material incorporated by reference in such Registration Statement.
The term "Representative" shall mean the Purchaser and any
successor thereto in accordance with this Agreement who shall act
on behalf of the holders of Registrable Securities in accordance
with the provisions of this Agreement.
The term "Restricted Securities" shall mean any security
unless or until: (i) it has been effectively registered under the
Securities Act and disposed of in accordance with the Registration
Statement covering it; (ii) it is distributed to the public
pursuant to Rule 144 (or any similar provisions then in force)
under the Securities Act; or (iii) it has otherwise been
transferred and a new certificate or other evidence of ownership
for it not bearing a restrictive legend pursuant to the Securities
Act and not subject to any stop transfer order has been delivered
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by or on behalf of the Corporation and no other restriction on
transfer exists.
The term "Securities Act" shall mean the Securities Act of
1933, as amended from time to time.
The term "Selling Expenses" shall have the meaning set forth
in Article VII.
The term "SEC" shall mean the Securities and Exchange
Commission.
The term "underwritten registration" or "underwritten
offering" shall mean a registration in which securities of the
Corporation are sold pursuant to a firm commitment underwriting to
an underwriter at a fixed price for reoffering or pursuant to
agency or best efforts arrangements with an underwriter.
ARTICLE II
SECURITIES SUBJECT TO THIS AGREEMENT; REPRESENTATIVE
A. Registrable Securities. The securities entitled to the
benefits of this Agreement are the Registrable Securities.
B. Holders of Registrable Securities. A Person is deemed to
be a holder of Registrable Securities whenever such Person owns
Registrable Securities or has the right to acquire such Registrable
Securities, whether or not such acquisition has actually been
effected and disregarding any legal restrictions upon the exercise
of such right. Without limiting the generality of the foregoing,
each holder of the Note and each holder of the Warrants shall be
deemed a holder of Registrable Securities.
C. Representative. For purposes of this Agreement unless
otherwise contemplated herein, only the Representative shall be
authorized, as set forth herein, to act on behalf of the holders of
Registrable Securities with respect to the transactions
contemplated hereby.
ARTICLE III
DEMAND REGISTRATION
Commencing 90 days prior to the fourth anniversary of the date
of this Agreement, the following registration rights shall exist
until terminated pursuant to Paragraph B of Article XI hereof, and
notwithstanding any exercise by the Corporation of its right and
option under Article VII of the Purchase Agreement:
A. Requests for Registration. Subject to the provisions of
Paragraph B of this Article III hereof, the Representative, on
behalf of any holder or holders of at least 1,200,000 of the
<PAGE>
Registrable Securities, may make a written request for a
registration with the SEC under and in accordance with the
provisions of the Securities Act of all or part of the Registrable
Securities (herein referred to as a "Demand Registration"). All
requests made pursuant to this Paragraph A shall specify the number
of Registrable Securities to be registered and shall also specify
the intended methods of disposition thereof; provided, however,
that if the Representative requests an underwritten offering, the
method of disposition shall be such an offering.
B. Restrictions on Registrations. Subject to Paragraph A
immediately preceding, the holders of Registrable Securities,
collectively, shall be entitled to one Demand Registration;
subject, however, to the provisions of Section 7.2(d) of the
Purchase Agreement, and provided, however, in all cases that such
obligation shall be deemed satisfied only when a Registration
Statement or Registration Statements covering all Restricted
Securities specified in a request for a Demand Registration
received as aforesaid (without any reduction pursuant to Paragraph
D of this Article III; and without accounting for any request for
a Demand Registration in the event the Corporation [or its
assignee, as the case may be] exercises any right and option under
Article VII of the Purchase Agreement), for sale in accordance with
the method of disposition specified in such request, shall have
become effective and, if such method of disposition is a firm
commitment underwritten public offering, all such shares have been
sold pursuant thereto. The Corporation shall not be obligated to
proceed with any Demand Registration if the Corporation shall
deliver to the Representative an opinion reasonably satisfactory in
form and substance to the Representative, of counsel, reasonably
satisfactory to the Representative, that the registration of such
Registrable Shares is not necessary to permit such sale in the
manner set forth in the Representative's request. In addition, the
Corporation shall not be obligated to proceed with any Demand
Registration during any period during which the Corporation would
be required to undertake an audit (other than as required to comply
with the covenants contained in Section 7.3 of the Purchase
Agreement or Section 6.4 of the Note) in order to have available
for inclusion in the registration statement current financial
statements as required in accordance with the Securities Act,
unless the Representative, on behalf of the holders of Registrable
Securities proposed to be subject to such registration, undertake
to bear the reasonable costs of such audit. Without limiting the
effect of any proviso contained in the first sentence of this
Paragraph B, in each case in which the Corporation is not required
to take any action, neither the Representative nor such holders
shall be deemed to have given the request giving rise thereto, and
shall be free to deliver a new notice requesting the registration
of Registrable Securities.
C. Expenses. The Corporation shall pay all Registration
Expenses (but not Selling Expenses) related to such registration,
whether or not the Registration Statement with respect to such
<PAGE>
registration has become effective, and, except as otherwise
provided herein, all other expenses incurred by the Corporation in
complying with this Article III. All Selling Expenses related to
such registration shall be borne by the participating sellers
(including the Corporation, if a seller), in proportion to the
number of shares sold by each, or by such sellers as they may
agree.
D. Incidental Rights to Demand Registrations
(i) Conditions. Neither the Corporation nor any of its
security holders (other than the holders of Registrable Securities)
shall have the right to include any of the Corporation's securities
in any registration initiated as a Demand Registration unless:
(a) such securities are of the same class as the
Registrable Securities included in such registration;
(b) if any of the Registrable Securities covered by
such registration are sold in an underwritten offering, the
Corporation or such security holders, as applicable, agree in
writing to sell their securities on the same terms and
conditions as apply to the Registrable Securities being sold
(except and to the extent any registration rights agreement
entered into by the Corporation on or prior to September 1,
1992, as in effect on such date [hereinafter referred to,
collectively, as the "Prior Registration Agreements"], affords
any such securityholder the right to do otherwise, subject to
the operation of such holdback agreements contained in the
Prior Registration Agreement entered into by such
securityholder as shall be no shorter in duration than those
in effect as of such date); and
(c) if any of the Registrable Securities covered by
such registration are to be sold in an underwritten offering,
the managing underwriters shall not have advised the
Corporation, the Representative or the holders of Registrable
Securities proposed to be subject to such registration that,
in their opinion, the total number or dollar amount of the
securities requested to be included in such registration by
the Corporation and/or such other security holders, together
with the Registrable Securities demanded to be registered
hereunder, exceeds the number of securities which can be sold
in such offering; provided, however, that if any Prior
Registration Agreement affords any other securityholder the
right to include a greater number of any of the Corporation's
securities in any registration initiated as a Demand
Registration, he may do so to the extent of such right, and
the number of Registrable Securities included therein may be
reduced solely to the extent required by the exercise of such
right (subject to the operation of the provisos contained in
the first sentence of Paragraph B contained in this Article
III).
<PAGE>
(ii) If any security holders of the Corporation (other
than the holders of Registrable Securities in such capacity)
register securities of the Corporation in a Demand Registration (in
accordance with the provisions of this Paragraph D), such holders
shall pay the fees and expenses of counsel to such holders and the
incremental amount of Registration Expenses incurred as a result of
their participation unless the Corporation has agreed to pay such
expenses and, in the opinion of counsel to the Corporation, such
payment shall not affect the ability of the Registrable Securities
to be qualified under the blue sky laws of any jurisdiction.
E. Selection of Underwriters. If any of the Registrable
Securities covered by a Demand Registration are to be sold in an
underwritten offering, the investment banker or investment bankers
and manager or managers that will administer the offering shall be
selected by the Representative; provided, however, that such
investment bankers and managers must be reasonably satisfactory to
the Corporation.
ARTICLE IV
INCIDENTAL REGISTRATIONS
A. Not a Demand. A registration of Registrable Securities
pursuant to this Article IV shall not be counted as a Demand
Registration under Article III hereof.
B. Notice and Request for Incidental Registration. Whenever
the Corporation proposes to register any of its securities under
the Securities Act, other than pursuant to a Demand Registration or
a registration on Forms S-4 or S-8 or comparable forms (hereinafter
referred to as an "Incidental Registration"), the Corporation shall
give written notice to the Representative of its intention to
effect such a registration not later than the earlier to occur of
(i) the tenth day following receipt by the Corporation of notice of
exercise of other demand registration rights or (ii) 45 days prior
to the anticipated filing date. Subject to the provisions of
Paragraphs D and E of this Article IV, and unless the Corporation
shall have withdrawn, prior to the effective date of such
Incidental Registration, all but not less than all of the
securities (other than the Registrable Securities, or any of them)
from such Incidental Registration, the Corporation shall include in
such Incidental Registration all Registrable Securities with
respect to which the Corporation has received written requests for
inclusion therein within 15 business days after the receipt by the
applicable holder of the Corporation's notice. The holders of
Registrable Securities shall be permitted to withdraw all or any
part of the Registrable Securities from an Incidental Registration
at any time prior to the effective date of such Incidental
Registration. If an Incidental Registration is an underwritten
offering effected:
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(i) under Paragraph D of this Article IV hereof, all
Persons whose securities are included in the Incidental
Registration shall be obligated to sell their securities on
the same terms and conditions as apply to the securities being
issued and sold by the Corporation, or (in the case of any
holder of Registrable Securities or, subject to the operation
of applicable holdback agreements as aforesaid, any party to
a Prior Registration Agreement) in the open market on terms
and conditions comparable to those normally applicable to
offerings in reasonably similar circumstances; or
(ii) under Paragraph E of this Article IV hereof,
all Persons whose securities are included in the Incidental
Registration shall be obligated to sell their securities on
the same terms and conditions as apply to the securities being
sold by the Person or Persons who initiated the Incidental
Registration under said paragraph, or (in the case of any
holder of Registrable Securities or, subject to the operation
of applicable holdback agreements as aforesaid, any party to
a Prior Registration Agreement) in the open market on terms
and conditions comparable to those normally applicable to
offerings in reasonably similar circumstances.
C. Incidental Registration Expenses. The Corporation shall
pay all Registration Expenses (but not Selling Expenses) related to
such registration, or incurred as a result of the participation in
an Incidental Registration of the holders of Registrable Secu-
rities, whether or not the Registration Statement with respect to
such registration has become effective, and all other expenses
incurred by the Corporation in complying with this Article IV. All
Selling Expenses related to such registration shall be borne by the
participating sellers (including the Corporation, if a seller), in
proportion to the number of shares sold by each, or by such sellers
as they may agree.
D. Priority on Underwritten Primary Registration. If an
Incidental Registration is an underwritten primary registration on
behalf of the Corporation, and the managing underwriters advise the
Corporation in writing that in their opinion the total number or
dollar amount of securities requested to be included in such
registration exceeds the number or dollar amount of securities
which can be sold in such offering, the Corporation shall include
in such registration:
(i) first, all securities the Corporation proposes
to sell; and
(ii) second, the Registrable Securities and such
other securities (provided such securities are of the same
class as the securities being sold by the Corporation)
requested to be included in such registration in excess of the
number of securities the Corporation proposes to sell which,
in the opinion of such underwriters, can be sold (allocated
<PAGE>
pro rata among the holders of such Registrable Securities and
other securities on the basis of the number of securities
requested to be included therein by each such holder);
except, in the event any party to a Prior Registration Agreement
exercises any rights thereunder with respect to such Incidental
Registration, the provisions of such Prior Registration Agreement
with respect to such allocation to such party shall supersede the
provisions of this Paragraph; and except, in the event of the
operation of the immediately preceding exception, if the holders of
Registrable Securities requesting such Incidental Registration
would be entitled to include a greater number of shares pursuant to
such Prior Registration Agreement as "Other Securityholders" (or
equivalent capacity) thereunder, the provisions of such Prior
Registration Agreement (as so applied) with respect to such
allocation to such holders shall supersede the provisions of this
Paragraph.
E. Priority on Underwritten Secondary Registration. If an
Incidental Registration is an underwritten secondary registration
on behalf of holders of the Corporation's securities, and the
managing underwriters advise the Corporation in writing that in
their opinion the number of securities requested to be included in
such registration exceeds the number of securities which can be
sold in such offering, the Corporation shall include in such
registration:
(i) first, all securities requested to be included
in such registration by the security holders initiating such
registration; and
(ii) second, up to the full number of Registrable
Securities and such other securities (provided such securities
are of the same class as the securities being sold by the
Corporation) requested to be included in such registration in
excess of the number of securities the security holders
initiating such registration propose to sell which, in the
opinion of such underwriters, can be sold (allocated pro rata
among the holders of such Registrable Securities and other
securities on the basis of the number of securities requested
to be included therein by each such holder);
except, in the event any party to a Prior Registration Agreement
exercises any rights thereunder with respect to such Incidental
Registration, the provisions of such Prior Registration Agreement
with respect to such allocation to such party shall supersede the
provisions of this Paragraph; and except, in the event of the
operation of the immediately preceding exception, if the holders of
Registrable Securities requesting such Incidental Registration
would be entitled to include a greater number of shares pursuant to
such Prior Registration Agreement as "Other Securityholders" (or
equivalent capacity) thereunder, the provisions of such Prior
Registration Agreement (as so applied) with respect to such
<PAGE>
allocation to such holders shall supersede the provisions of this
Paragraph.
F. Selection of Underwriters. If any Incidental Registration
is an underwritten offering, the Corporation shall have the right
to select the investment banker or investment bankers and manager
or managers to administer the offering, except as otherwise agreed
in a Prior Registration Agreement.
ARTICLE V
HOLDBACK AGREEMENTS
A. Restrictions on Public Sale by Holder of Registrable
Securities. Each holder of Registrable Securities (including those
Persons deemed to be holders under the final sentence of Paragraph
B of Article II hereof) whose Registrable Securities are covered by
a Registration Statement filed pursuant to Article III or IV hereof
shall agree, if requested by the managing underwriters, not to
effect any public sale or distribution of securities of the
Corporation of the same class, or securities convertible into or
exchangeable or exercisable for such class as the securities
included in such Registration Statement, including a sale pursuant
to Rule 144 under the Securities Act (except as part of such
underwritten registration) during the ten-day period prior to, and
during the 90-day period beginning on, the closing date of each
underwritten offering (or best efforts underwritten offering in the
case of a Registration Statement filed under Article III) of
Registrable Securities made pursuant to such Registration
Statement, to the extent timely notified in writing by the
Corporation or the managing underwriters. The foregoing provisions
shall not apply to any holder of Registrable Securities if such
holder is prevented by applicable statute or regulation from
entering any such agreement; provided, however, that any such
holder shall undertake, in the request to participate in any such
underwritten offering, not to effect any public sale or
distribution of the applicable class of Registrable Securities
commencing on the date of sale of such applicable class of
Registrable Securities (or securities convertible into or
exercisable for such class) unless it has provided 45 days' prior
written notice of such sale or distribution to the underwriter or
underwriters.
B. Restrictions on Public Sale by the Corporation and
Others. The Corporation agrees:
(i) not to effect any public or private sale or
distribution of its equity securities, or any securities
convertible into or exchangeable or exercisable for such
equity securities, including a sale pursuant to Regulation D
under the Securities Act, during the ten-day period prior to,
and during the 90-day period beginning on, the closing date of
each underwritten offering made pursuant to a Registration
<PAGE>
Statement filed under Article III hereof, without the consent
of the managing underwriters of such underwritten offering and
except for securities issuable pursuant to commitments entered
into prior to the effective date of the Registration Statement
filed under Article III hereof, to the extent timely notified
in writing by a holder of Registrable Securities or the
managing underwriters (except as part of such underwritten
registration or pursuant to registrations on Form S-4 or S-8
or any successor form to such Forms); and
(ii) to cause each officer and director of the
Corporation who is a holder of its equity securities, or any
securities convertible into or exchangeable or exercisable for
such equity securities to agree not to effect any public sale
or distribution of any such securities during such period,
including a sale pursuant to Rule 144 under the Securities Act
(except as part of such underwritten registration, if
permitted, or with the consent of the managing underwriter of
such underwritten offering).
ARTICLE VI
REGISTRATION PROCEDURES
Whenever the Representative or the holders of Registrable
Securities have requested that any Registrable Securities be
registered pursuant to this Agreement, the Corporation shall use
its best efforts to effect such registration to permit the sale of
such Registrable Securities in accordance with the intended method
or methods of disposition thereof, and pursuant thereto the
Corporation shall as expeditiously as possible:
A. prepare and file with the SEC, not later than 90 days
after receipt of a request to file a Registration Statement for a
Demand Registration, a Registration Statement on a form for which
the Corporation then qualifies which is satisfactory to the
Corporation and the Representative (unless the offering is made on
an underwritten basis, including on a best efforts underwriting
basis, in which event the managing underwriter or underwriters
shall determine the form to be used) and which form shall be
available for the sale of the Registrable Securities in accordance
with the intended method or methods of distribution thereof, and
use its best efforts to cause such Registration Statement to become
effective; provided, however, that before filing a Registration
Statement or Prospectus or any amendments or supplements thereto,
including documents incorporated by reference after the initial
filing of the Registration Statement, the Corporation shall furnish
to the Representative and the underwriters, if any, copies of all
such documents proposed to be filed, which documents will be
subject to the review of the Representative and such underwriters,
and the Corporation shall not file any Registration Statement or
amendment thereto or any Prospectus or any supplement thereto
(including such documents incorporated by reference) to which the
<PAGE>
Representative or the underwriters, if any, shall reasonably
object; and; provided, further, that the Corporation shall not be
obligated to file a Registration Statement for a Demand
Registration: (w) within the 90-day period beginning on the Initial
Public Offering Date; (x) within the 90-day period beginning on the
effective date of any Registration Statement for an Incidental
Registration; (y) within the period commencing on the date of
receipt by the Corporation of a demand for registration pursuant to
a Prior Registration Agreement and expiring six months after the
effective date of the registration statement filed pursuant to such
demand (or, if shorter, the shortest period as is not prohibited by
such Prior Registration Agreement); or (z) within the 90-day period
after any determination in good faith by the Board of Directors of
the Corporation (which determination may be made on one occasion
only) that the best interests of the Corporation would be
materially impaired by disclosure at that time in the Registration
Statement of material, non-public information with respect to the
Corporation;
B. prepare and file with the SEC such amendments and post-
effective amendments to the Registration Statement as may be
necessary to keep the Registration Statement effective for a period
of not less than six months, or such shorter period which will
terminate when all Registrable Securities covered by such
Registration Statement have been sold or withdrawn; cause the
Prospectus to be supplemented by any required Prospectus
supplement, and as so supplemented to be filed pursuant to Rule 424
under the Securities Act; and comply with the provisions of the
Securities Act with respect to the disposition of all securities
covered by such Registration Statement during the applicable period
in accordance with the intended methods of disposition by the
sellers thereof set forth in such Registration Statement or
supplement to the Prospectus;
C. notify the Representative and the managing underwriters,
if any, promptly, and (if requested by any such Person) confirm
such advice in writing,
(i) when the Prospectus or any Prospectus supplement
or post-effective amendment has been filed, and, with respect
to the Registration Statement or any post-effective amendment,
when the same has become effective;
(ii) of any request by the SEC for amendments or
supplements to the Registration Statement or the Prospectus or
for additional information;
(iii) of the issuance by the SEC of any stop order
suspending the effectiveness of the Registration Statement or
the initiation of any proceedings for that purpose;
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(iv) if at any time the representations and
warranties of the Corporation contemplated by Paragraph O
below cease to be true and correct in all material respects;
(v) of the receipt by the Corporation of any
notification with respect to the suspension of the
qualification of the Registrable Securities for sale in any
jurisdiction or the initiation or threatening of any
proceeding for such purpose; and
(vi) of the happening of any event which makes any
statement made in the Registration Statement, the Prospectus
or any document incorporated therein by reference untrue or
which requires the making of any changes in the Registration
Statement, the Prospectus or any document incorporated therein
by reference in order to make the statements therein not
misleading;
D. make every reasonable effort to obtain the withdrawal of
any order suspending the effectiveness of the Registration
Statement as promptly as practicable;
E. if requested by the managing underwriters or the
Representative, immediately incorporate in a Prospectus supplement
or post-effective amendment such information as the managing
underwriters and the Representative and their respective counsel
reasonably conclude should be included in the Registration
Statement, so that such Registration Statement conforms in both
form and substance to the requirements of the Securities Act,
including without limitation with respect to the number of
Registrable Securities being sold to such underwriters, the
purchase price being paid therefor by such underwriters and with
respect to any other terms of the underwritten offering of the
Registrable Securities to be sold in such offering; and make all
required filings of such Prospectus supplement or post-effective
amendment as soon as notified of the matters to be incorporated in
such Prospectus supplement or posteffective amendment;
F. promptly prior to the filing of any document which is to
be incorporated by reference into the Registration Statement or the
Prospectus (after initial filing of the Registration Statement)
provide copies of such document to counsel to the Representative
and to the managing underwriters, if any, make the Corporation's
representatives available for discussion of such document and make
such changes in such document prior to the filing thereof as
counsel for the Representative or underwriters may reasonably
request;
G. furnish to the Representative, each selling holder of
Registrable Securities and each managing underwriter, without
charge, at least one signed copy of the Registration Statement and
any post-effective amendment thereto, including financial state-
<PAGE>
ments and schedules, all documents incorporated therein by
reference and all exhibits (including those incorporated by
reference);
H. deliver to the Representative, each selling holder of
Registrable Securities and the underwriters, if any, without
charge, as many copies of the Prospectus (including each
preliminary prospectus) and any amendment or supplement thereto as
such Persons may reasonably request (and the Corporation hereby
consents to the use of the Prospectus or any amendment or
supplement thereto by the Representative, each of the selling
holders of Registrable Securities and the underwriters, if any, in
connection with the offering and sale of the Registrable Securities
covered by the Prospectus or any amendment or supplement thereto);
I. prior to any public offering of Registrable Securities,
use its best efforts to register or qualify or cooperate with the
Representative, the underwriters, if any, 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 as any seller or underwriter
reasonably requests in writing and do any and all other acts or
things necessary or advisable to enable the disposition in such
jurisdictions of the Registrable Securities covered by the
Registration Statement; provided, however, that the Corporation
shall not be required to qualify generally to do business in any
jurisdiction where it is not then so qualified or to take any
action which would subject it to general service of process in any
such jurisdiction where it is not then so subject;
J. cooperate with the Representative and the managing
underwriters, if any, to facilitate the timely preparation and
delivery of certificates representing Registrable Securities to be
sold and not bearing any restrictive legends; and enable such
Registrable Securities to be in such denominations and registered
in such names as the managing underwriters may request at least two
business days prior to any sale of Registrable Securities to the
underwriters;
K. use its best efforts to cause the Registrable Securities
covered by the Registration Statement to be registered with or
approved by such other governmental agencies or authorities as may
be necessary to enable the seller or sellers thereof or the
underwriters, if any, to consummate the disposition of such
Registrable Securities;
L. upon the occurrence of any event contemplated by clause
(vi) of Paragraph C of this Article VI, prepare a supplement or
post-effective amendment to the Registration Statement or the
Prospectus or any document incorporated therein by reference or
file any other required document so that, as thereafter delivered
to the purchasers of the Registrable Securities, the Prospectus
shall not contain an untrue statement of a material fact or omit to
<PAGE>
state any material fact necessary to make the statements therein
not misleading;
M. use its best efforts to cause all Registrable Securities
covered by the Registration Statement to be listed on each
securities exchange on which similar securities issued by the
Corporation are then listed if requested by the Representative or
the managing underwriters, if any;
N. provide a transfer agent and registrar for all
Registrable Securities and a CUSIP number for all Registrable
Securities, in each case not later than the effective date of such
registration statement;
O. enter into such agreements (including an underwriting
agreement reasonably satisfactory to the Corporation, containing
customary representations, warranties and agreements) and take all
such other reasonable actions in connection therewith in order to
expedite or facilitate the disposition of such Registrable
Securities and in such connection, whether or not an underwriting
agreement is entered into and whether or not the registration is an
underwritten registration:
(i) make such representations and warranties to the
holders of such Registrable Securities and the underwriters,
if any, in such form, substance and scope as are customarily
made by issuers to underwriters in primary underwritten
offerings and covering matters including but not limited to,
those set forth in the Purchase Agreement;
(ii) obtain opinions of counsel to the Corporation
and updates thereof (which counsel and opinions, in form,
scope and substance, shall be reasonably satisfactory to the
managing underwriters, if any, and the Representative)
addressed to each selling holder and the underwriters, if any;
(iii) obtain "cold comfort" letters and updates
thereof from the Corporation's independent certified public
accountants addressed to the selling holders of Registrable
Securities and the underwriters, if any, such letters to be in
customary form and covering matters of the type customarily
covered in "cold comfort" letters to underwriters in
connection with primary underwritten offerings;
(iv) if an underwriting agreement is entered into,
cause the same to set forth in full the indemnification and
contribution provisions and procedures of Article VIII hereof,
or language at least as favorable to the holders of the
Registrable Securities, with respect to all parties to be
indemnified pursuant to said Article; and
(v) deliver such documents and certificates as may
be reasonably requested by the Representative and the managing
<PAGE>
underwriters, if any, to evidence compliance with clause (i)
of this Paragraph O and with any customary conditions con-
tained in the underwriting agreement or other agreement
entered into by the Corporation.
The obligations under this Paragraph O above shall be performed at
each closing under such underwriting or similar agreement or as and
to the extent required thereunder.
P. make available for inspection by the Representative, any
underwriter participating in any disposition pursuant to such
registration statement, and any attorney, accountant or other agent
retained by the sellers or underwriter, all financial and other
records, pertinent corporate documents and properties of the
Corporation, and cause the Corporation's officers, directors and
employees to supply all information reasonably requested by any
such representative, underwriter, attorney, accountant or agent
solely for use in connection with such registration statement;
provided, however, that any records, information or documents that
are designated by the Corporation in writing as confidential shall
be kept confidential by such Persons pursuant to such reasonable
confidentiality agreements as the Corporation may request;
Q. otherwise use its best efforts to comply with all
applicable rules and regulations of the SEC, and make generally
available to its security holders, earnings statements satisfying
the provisions of Section 11(a) of the Securities Act, no later
than 45 days after the end of any twelve-month period (or 90 days,
if such period is a fiscal year): (i) commencing at the end of any
fiscal quarter in which Registrable Securities are sold to
underwriters in an underwritten offering; or, if not sold to
underwriters in such an offering, (ii) beginning with the first
month of the Corporation's first fiscal quarter commencing after
the effective date of the Registration Statement; which statements
shall cover said twelve-month periods.
Whenever any Registrable Securities are registered pursuant to
this Agreement, the holders thereof shall, in order to expedite or
facilitate the disposition of such Registrable Securities, obtain
opinions of counsel to such holders and updates thereof (which
counsel and opinions, in form, scope and substance, shall be
reasonably satisfactory to the managing underwriters, if any, and
to the Representative, and to the Corporation) addressed to each
selling holder (and the Corporation) and the underwriters, if any.
ARTICLE VII
REGISTRATION AND SELLING EXPENSES
For purposes of this Agreement, all underwriting discounts and
selling commissions applicable to the sale of Registrable
Securities (all such expenses being herein referred to as "Selling
Expenses"), and all expenses incident to the Corporation's
<PAGE>
performance of or compliance with this Agreement, including without
limitation:
A. all registration and filing fees (including with respect
to filings required to be made with the National Association of
Securities Dealers, Inc.);
B. fees and expenses of compliance with securities or blue
sky laws (including fees and disbursements of counsel for the
underwriters in connection with blue sky qualifications of the
Registrable Securities and determination of their eligibility for
investment under the laws of such jurisdictions as the managing
underwriters or the Representative may designate);
C. printing, messenger, telephone and delivery expenses;
D. fees and disbursements of counsel for the Corporation,
and for one counsel or one firm acting as counsel for the sellers
of the Registrable Securities (as the Representative may designate)
and (to the extent required by the underwriters) for the
underwriters;
E. fees and disbursements of all independent certified
public accountants of the Corporation (including the expenses of
any "cold comfort" letters required by or incident to such
performance);
F. to the extent required by the underwriters, fees and
disbursements of underwriters (excluding Selling Expenses);
G. reasonable fees and expenses of any special experts
retained by the Representative (and approved by the Corporation,
which approval shall not unreasonably be withheld), by the
Corporation at its own initiative or at the request of the managing
underwriters in connection with such registration; and
H. fees and expenses of other Persons retained by the
Corporation;
(all such expenses being herein called "Registration Expenses")
shall be borne as provided in this Agreement; it being understood
and agreed that the Corporation shall, in any event, pay its
internal expenses (including, without limitation, all salaries and
expenses of its officers and employees performing legal or
accounting duties), the expense of any annual audit conducted at
the end of the Corporation's fiscal year in the ordinary course of
business, and the fees and expenses incurred in connection with the
listing of the securities to be registered on each securities
exchange and securities association.
<PAGE>
ARTICLE VIII
INDEMNIFICATION
A. Indemnification by Corporation. The Corporation agrees to
indemnify, to the full extent permitted by law, each holder of
Registrable Securities, its officers, directors, employees and
agents and each Person who controls such holder (within the meaning
of the Securities Act) against all losses, claims, damages,
liabilities and expenses caused by any untrue or alleged untrue
statement of a material fact contained in any Registration
Statement, Prospectus or preliminary prospectus or 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 the same are caused by or contained
in any information furnished in writing to the Corporation by such
holder expressly for use therein or by such holder's failure to
deliver a copy of the Registration Statement or Prospectus after
the Corporation has furnished such holder with a sufficient number
of copies of the same. The Corporation shall also indemnify
underwriters, selling brokers, dealer managers and similar
securities industry professionals participating in the
distribution, their officers and directors and each Person who
controls such Persons (within the meaning of the Securities Act) to
the same extent as hereinabove provided with respect to the
indemnification of the holders of Registrable Securities.
B. Indemnification by Holder of Registrable Securities. In
connection with any Registration Statement in which a holder of
Registrable Securities is participating, each such holder will
furnish to the Corporation in writing such information and
affidavits as the Corporation reasonably requests for use in
connection with any Registration Statement or Prospectus and agrees
to indemnify, to the full extent permitted by law, the Corporation,
its directors and officers and each Person who controls the
Corporation (within the meaning of the Securities Act) against any
losses, claims, damages, liabilities and expenses resulting from
any untrue or alleged untrue statement of a material fact or any
omission or alleged omission of a material fact required to be
stated in the Registration Statement or Prospectus or preliminary
Prospectus or necessary to make the statements therein not
misleading, to the extent, but only to the extent, that such untrue
statement or omission is contained in any information or affidavit
so furnished in writing by such holder to the Corporation
specifically for inclusion in such Registration Statement or
Prospectus. In no event shall the liability of any selling holder
of Registrable Securities hereunder be greater in amount than the
dollar amount of the proceeds received by such holder upon the sale
of the Registrable Securities giving rise to such indemnification
obligation. The Corporation shall be entitled to receive
indemnities from underwriters, selling brokers, dealer managers and
similar securities industry professionals participating in the
distribution, to the same extent as provided above with respect to
<PAGE>
information so furnished in writing by such Persons specifically
for inclusion in any Prospectus or Registration Statement.
C. Conduct of Indemnification Proceedings. Any Person
entitled to indemnification hereunder shall (i) give prompt notice
to the indemnifying party of any claim with respect to which it
seeks indemnification and (ii) permit such indemnifying party to
assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party; provided, however, that any
Person entitled to indemnification hereunder shall have the right
to employ separate counsel and to participate in the defense of
such claim, but the fees and expenses of such counsel shall be at
the expense of such Person unless (a) the indemnifying party has
agreed to pay such fees or expenses, or (b) the indemnifying party
shall have failed to assume the defense of such claim and employ
counsel reasonably satisfactory to such Person, or (c) in the
reasonable judgment of any such Person and the indemnifying party,
based upon advice of their respective counsel, a conflict of
interest may exist between such Person and the indemnifying party
with respect to such claims (in which case, if the Person notifies
the indemnifying party in writing that such Person elects to employ
separate counsel at the expense of the indemnifying party, the
indemnifying party shall not have the right to assume the defense
of such claim on behalf of such Person). If such defense is not
assumed by the indemnifying party, the indemnifying party shall not
be subject to any liability for any settlement made without its
consent (but such consent will not be unreasonably withheld). No
indemnifying party shall be required to consent to entry of any
judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff
to such indemnified party of a release from all liability in
respect to such claim or litigation. An indemnifying party who is
not entitled to, or elects not to, assume the defense of a claim
will not be obligated to pay the fees and expenses of more than one
counsel for all parties indemnified by such indemnifying party with
respect to such claim, unless in the reasonable judgment of any
indemnified party a conflict of interest may exist between such
indemnified party and any other of such indemnified parties with
respect to such claim, in which event the indemnifying party shall
be obligated to pay the fees and expenses of such additional coun-
sel or counsels.
D. Contribution. If the indemnification provided for in
this Article VIII is unavailable or insufficient to hold harmless
an indemnified party under Paragraphs A or B immediately preceding,
then each indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of the losses,
claims, damages or liabilities referred to in said Paragraphs A or
B, in such proportion as is appropriate to reflect the relative
fault of the Corporation, on the one hand, and the participating
holders of Registrable Securities, on the other, in connection with
the statements or omissions that resulted in such losses, claims,
damages or liabilities, as well as any other relevant equitable
<PAGE>
considerations. The relative fault shall be determined by
reference to, among other things, whether the untrue or alleged
untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied
by the Corporation on the one hand or such holders on the other,
and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such untrue statement or
omission. The parties agree that it would not be just and
equitable if contributions pursuant to this Paragraph D were to be
determined by pro rata allocation or by any other method of
allocation that does not take account of the equitable
considerations referred to in the prior provisions of this
Paragraph D. The amount paid by an indemnified party as a result
of the losses, claims, damages or liabilities referred to in the
prior provisions of this Paragraph D shall be deemed to include any
legal or other expenses reasonably incurred by such indemnified
party in connection with investigating or defending against any
action or claim that is the subject of this Paragraph D. Notwith-
standing the provisions of this Paragraph D, no participating
holder of Registrable Securities shall be required to contribute
any amount in excess of the amount by which the net proceeds
received from the sale of its shares exceeds the amount of any
damages that it has otherwise been required to pay by reason of
such untrue or alleged untrue statement or omission or alleged
omission. For purposes of this Paragraph D no person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f)
of the Securities Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
ARTICLE IX
RULE 144
The Corporation covenants, for as long as it is required to do
so under the Securities Act or the Exchange Act, that it shall file
the reports required to be filed by it under the Securities Act and
the Exchange Act and the rules and regulations adopted by the SEC
thereunder, and it shall take such further action as any holder of
Registrable Securities may reasonably request, all to the extent
required from time to time to enable such holder to sell
Registrable Securities without registration under the Securities
Act within the limitation of the exemptions provided by (i) Rule
144 under the Securities Act, as such rule may be amended from time
to time, or (ii) any similar rule or regulation hereafter adopted
by the SEC. Upon the request of any holder of Registrable Secu-
rities, the Corporation shall deliver to such holder a written
statement as to whether it has complied with such information and
requirements.
<PAGE>
ARTICLE X
PARTICIPATION IN UNDERWRITTEN REGISTRATIONS
No Person may participate in any underwritten registration
hereunder unless such Person (i) agrees to sell such Person's
securities on the basis provided in any underwriting arrangements
approved by the Persons entitled hereunder to approve such
arrangements and (ii) completes and executes all questionnaires,
powers of attorney, indemnities, underwriting agreements and other
documents required under the terms of such underwriting
arrangements.
ARTICLE XI
MISCELLANEOUS
A. Remedies. Each holder of Registrable Securities, in
addition to being entitled to exercise all rights provided herein
or granted by law, including recovery of damages, shall be entitled
to specific performance of its rights under this Agreement. The
Corporation agrees that monetary damages would not be adequate
compensation for any loss incurred by reason of a breach by it of
the provisions of this Agreement and hereby agrees to waive the
defense in any action for specific performance that a remedy at law
would be adequate.
B. Term. The registration rights granted under Article III
hereof shall terminate on the sixth anniversary of the date hereof,
and the registration rights granted under Article IV hereof shall
terminate on the third anniversary of the maturity of the Note.
C. Notices. All notices, requests or instructions hereunder
shall be in writing and delivered personally or sent by registered
or certified mail, postage prepaid, or by telecopy (or like
transmission) as follows:
(1) if to the Corporation:
888 Seventh Avenue
New York, New York 10106
Attention: Stephen Russell
Telecopy number: (212) 315-5281
with a copy to:
Arnold S. Jacobs, Esq.
Shea & Gould
1251 Avenue of the Americas
New York, New York 10020-1193
<PAGE>
Telecopy number: (212) 840-6702
(2) if to the Purchaser, the Representative,
or any holder of Registrable Securities:
375 Park Avenue
New York, New York 10152
Attention: Paul A. Biddelman
Telecopy number: (212) 223-2425
with a copy to:
Howard Kailes, Esq
Krugman, Chapnick & Grimshaw
Park 80 West - Plaza Two
Saddle Brook, New Jersey 07662
Telecopy number: (201) 845-9627
Any notice so addressed and mailed, shall be deemed to be given
when so mailed. Any notice so addressed and otherwise delivered
shall be deemed to be given when actually received by the
addressee. Any of the above addresses may be changed at any time
by notice given as provided above; provided, however, that any such
notice of change of address shall be effective only upon receipt.
D. Entire Agreement. This Agreement and the documents
referred to herein contain the entire agreement of the parties
hereto with respect to the transactions contemplated hereby, and
supersede all prior understandings, arrangements, and agreements
with respect to the subject matter hereof. No modification hereof
shall be effective unless in writing and signed by the party
against which it is sought to be enforced.
E. Further Action. Each of the parties hereto shall use
such party's best efforts to take such actions as may be necessary
or reasonably requested by the other party hereto to carry out and
consummate the transactions contemplated by this Agreement.
F. Successors and Assigns. The registration rights granted
to the holders of Registrable Securities under Article III and
under Article IV, subject to the provisions of Section 9.6 of the
Purchase Agreement, may be transferred to a transferee who acquires
any Purchaser Shares, which transfer shall be effective when the
Corporation is given notice by the transferor at the time of such
transfer stating the name and address of the transferee and
identifying the securities with respect to which the rights under
Article III and IV are being assigned. Without limiting the
generality of the foregoing, the parties understand and agree that
the Representative may assign all but not less than all of its
<PAGE>
rights to enforce this Agreement in the capacity as Representative,
subject to the consent of the Corporation in the event of such
assignment to a person or entity known to the Representative to
conduct a business in competition with the principal business of
the Corporation and its subsidiaries, collectively.
G. Number of Shares. All references herein to numbers of
shares of Registrable Securities shall be subject to appropriate
adjustment for stock splits, stock dividends and recapitalizations
of the Corporation.
H. Subsequent Registration Rights. The Corporation shall
not, from and after the date hereof, grant any registration rights
to Stephen Russell or Leonard Bennett in a manner that will
obligate the Corporation to grant identical rights to any other
current securityholder of the Corporation.
I. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of New York
applicable in the case of agreements made and to be performed
entirely within such State.
J. Captions. The captions appearing herein are for the
convenience of the parties only and shall not be construed to
affect the meaning of the provisions of this Agreement.
K. Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed to be an original, but
all of which taken together shall constitute one and the same
agreement.
IN WITNESS WHEREOF, the parties have executed this
Agreement as of the date first written above.
ATTEST: CELADON GROUP, INC.
s/Richard Goldberg By s/Stephen Russell
- ------------------------- -----------------------------
Secretary Chairman
ATTEST: HANSEATIC CORPORATION
s/Elizabeth Parella By s/Paul A. Biddelman
- ------------------------- -----------------------------
Secretary Treasurer
