Initial Public Offering (IPO): Pre-Effective Amendment to Registration Statement (General Form) — Form S-1
Filing Table of Contents
Document/Exhibit Description Pages Size
1: S-1/A Amendment No. 3 to Form S-1/A 3 18K
2: EX-1.1 Form of Underwriting Agreement 35 110K
3: EX-4.1 Specimen of Common Stock Certificate 2 11K
4: EX-5 Opinion of Hunton & Williams Re. Legality 2 9K
5: EX-10.1 Form of Bank Credit Facility 98 323K
6: EX-10.2 Stock Compensation Plan 25 95K
7: EX-10.3 Stock Purchase & Indemnification Agreement 24 64K
8: EX-10.4 Services Agreement 10 27K
9: EX-10.5 Tax Allocation Agreement 49 111K
10: EX-10.6 Computer & Information Tech. Agreements 69 121K
11: EX-10.7 Pension Plan Agreement 4 12K
EX-10.3 — Stock Purchase & Indemnification Agreement
Exhibit Table of Contents
EXHIBIT 10.3
STOCK PURCHASE AND INDEMNIFICATION AGREEMENT
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THIS STOCK PURCHASE AND INDEMNIFICATION AGREEMENT (the "Agreement") is made
and entered into this _______ day of August, 1998 by and among UNION PACIFIC
CORPORATION, a Utah corporation ("UPC"), OVERNITE CORPORATION, a Virginia
corporation ("Overnite"), OVERNITE HOLDING, INC., a Delaware corporation
("OHI"), and OVERNITE TRANSPORTATION COMPANY, a Virginia corporation ("OTC").
WHEREAS, Overnite intends to issue and sell the shares of its common stock,
par value $0.01 per share (the "Overnite Shares"), through an initial public
offering (the closing of which is hereinafter referred to as the "Offering");
and
WHEREAS, in connection with the Offering, Overnite has filed a registration
statement with the Securities and Exchange Commission under the Securities Act
of 1933, as amended (the "1933 Act"); and
WHEREAS, immediately following the Offering, Overnite intends to purchase
all of the issued and outstanding common stock of OHI, par value $0.01 per share
(the "OHI Shares"), from UPC (the "Acquisition"), with the result that Overnite
will become a publicly-owned company and OHI will become a wholly-owned, direct
subsidiary of Overnite; and
WHEREAS, OTC is a wholly-owned, direct subsidiary of OHI and immediately
following the Acquisition will become a wholly-owned, indirect subsidiary of
Overnite; and
WHEREAS, the parties hereto desire to enter into this Agreement in order to
provide for the Acquisition and the indemnification against certain costs and
liabilities which may be incurred in connection with the Offering, the
Acquisition and the above-mentioned registration statement, including any
prospectus included therein, and their respective businesses both prior to and
after the Offering and Acquisition.
NOW, THEREFORE, in consideration of the mutual promises and covenants
herein contained, the parties hereto agree as follows:
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1. Definitions. As used in this Agreement, the following terms shall
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have the following meanings (such meanings to be equally applicable to both the
singular and plural versions of the terms below):
The term "Affiliate" shall have the meaning accorded to such term in Rule
12b-2 of the General Rules and Regulations under the Securities Exchange Act of
1934, as in effect on the date hereof.
The term "Bank Credit Agreement" shall mean the $200 million Revolving
Credit Agreement, dated as of August ___, 1998, among Overnite, the Banks named
therein and Crestar Bank, as Agent for the Banks;
The term "Business Day" shall mean a day of the year on which banks are not
required or authorized to close in New York City, Nebraska or Virginia.
The term "Closing" shall mean the closing of the Offering and the
Acquisition.
The term "Code" shall mean the Internal Revenue Code of 1986, as amended.
The term "Guarantee" shall mean all guarantees, surety and performance
bonds, payment or reimbursement obligations relating to insurance arrangements,
letters of credit and other arrangements pursuant to which UPC guarantees or
secures any Overnite Liability or which otherwise potentially impose liability
on UPC with respect to the businesses, operations or assets conducted or owned
or formerly conducted or owned by the Overnite Group, and which are in effect as
of the Closing.
The term "Liabilities" shall mean all debts, liabilities and obligations,
actual or contingent, liquidated or unliquidated, accrued or unaccrued, known or
unknown, whenever and however arising, including all costs and expenses
(including fees and disbursements of counsel) relating thereto, and including
without limitation debts, liabilities and obligations arising in connection with
any actual or threatened claim, action, suit, arbitration, inquiry, proceeding
or investigation by or before any court, governmental or other regulatory or
administrative agency or commission or any arbitration panel.
The term "Overnite Group" shall mean Overnite and all Affiliates of
Overnite following the Closing, including without limitation OHI and OTC, and
all subsidiaries of OTC on or prior to the Closing, and any or each of such
entities individually and collectively, and jointly and severally.
The term "Overnite Liabilities" shall mean all Liabilities (other than
Liabilities for Taxes
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except as provided below in this definition) at any time arising out of or
relating to the businesses, operations or assets conducted or owned or formerly
conducted or owned at any time by, and the current or former employees of, the
Overnite Group. In the case of an "employee benefit plan," as defined in Section
3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA"), maintained or formerly maintained by the Overnite Group for its
employees or former employees, "Overnite Liabilities" shall include all
liabilities for any benefits due and payable under the terms of such plans as
well as any Taxes, penalties, interest or other charges imposed by any
governmental agency with respect to the maintenance and administration of such
plans. Further, in case of any employee benefit plan maintained or formerly
maintained by the UPC Group in which employees or former employees of the
Overnite Group have participated, "Overnite Liabilities" shall be limited to the
portion of the liability, Tax, penalty, interest or other charge attributable to
employees or former employees of the Overnite Group, or in the event that a
liability, Tax, penalty, interest or other charge is not attributable to
specific employees or former employees, "Overnite Liabilities" shall be limited
to the portion of the liability, Tax, penalty, interest or other charge that
bears the same relationship to the whole thereof as the benefit liabilities
under such plan attributable to employees or former employees of the "Overnite
Group" bears to all such benefit liabilities under the plan, and any costs
(including reasonable counsel fees) imposed upon or incurred by the "Overnite
Group" in connection with such liability shall be allocated in the same manner.
"Overnite Liabilities" shall also include any Liabilities arising from or
relating to (i) the conversion of any share of UPC retention stock or any option
to purchase shares of UPC cmmon stock into one or more shares of Overnite
retention stock or options to purchase shares of Overnite common stock and (ii)
amounts payable to employees of the Overnite Group as deferred compensation
under the UPC Executive Incentive Plan.
The term "Overnite Securities Liabilities" shall mean any Liability under
the 1933 Act, the Securities Exchange Act of 1934, as amended (the "1934 Act"),
or any other federal or state securities law or regulation, at common law or
otherwise, arising out of the Offering, including without limitation any such
Liability arising out of or based upon (i) any untrue statement or alleged
untrue statement of a material fact contained in a registration statement filed
under federal or state securities
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laws in connection with the Offering, or in any amendment or supplement thereto
(a "Registration Statement"), or in any prospectus or other communication
relating to the Offering or in any amendment or supplement thereto (a
"Prospectus"), or (ii) the omission or alleged omission to state in a
Registration Statement or Prospectus a material fact required to be stated
therein or necessary to make the statements made therein not misleading;
provided, however, that the foregoing definition shall not extend or apply to
any Liability that arises out of or is based upon any untrue statement or
alleged untrue statement of a material fact contained in, or an omission or
alleged omission to state a material fact required to be stated (or necessary to
make the statement not misleading) in (A) the information set forth under the
captions "Prospectus Summary - Background to the Offering" and "The Acquisition"
in the Prospectus to the extent related to the actions or intentions of UPC, or
(B) information otherwise set forth in the Prospectus to the extent related to
UPC's ownership of the capital stock of OHI (the "UPC Information").
The term "Taxes" shall mean any and all taxes (including interest,
penalties and additions to tax), premiums, fees and charges (including sales,
use, excise, value added, personal property and other taxes) imposed by any
federal, state or local or government tax authority in the United States of
America or by any foreign government or taxing authority.
The term "Transaction Costs" shall mean the following fees and expenses
incurred in connection with the Offering and Acquisition: (i) the fees and
expenses of Hunton & Williams and Richards, Layton & Finger, (ii) the fees and
expenses of Deloitte & Touche LLP, including without limitation fees and
expenses incurred in connection with the audit of financial statements for the
Overnite Group, (iii) the fees and expenses of Price Waterhouse LLP incurred in
connection with the valuation of Overnite Group assets, (iv) the fees and
expenses of Towers Perrin and Buck Consultants incurred for actuarial services
performed in connection with the Offering and Acquisition, (v) any underwriters'
discounts or commissions, (vi) all organization expenses of Overnite, including
without limitation all fees, expenses, Taxes, assessments and other costs and
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expenses associated with its incorporation in the State of Virginia and its
qualification to do business in any jurisdiction, (vii) all Securities and
Exchange Commission, National Association of Securities Dealers, Inc., and other
filing fees, all "blue sky" fees and expenses and all stock exchange fees and
expenses, (viii) all transfer taxes, if any, in connection with the issuance and
sale of Overnite Shares in the Offering and the sale of OHI Shares to Overnite
in the Acquisition, (ix) all printing fees and expenses and (x) all transfer
agent and registration fees and expenses.
The term "UPC Group" shall mean UPC and all Affiliates of Union Pacific
Corporation (other than any member of the Overnite Group), and any or each of
such entities individually and collectively and jointly and severally.
The term "UPC Liabilities" shall mean all Liabilities (other than
Liabilities for Taxes except as provided below in this definition) at any time
arising out of or relating to the businesses, operations or assets conducted or
owned or formerly conducted or owned by, and the current or former employees of,
the UPC Group; provided that in no event shall UPC Liabilities include any
Overnite Liabilities, any Overnite Securities Liabilities, any liabilities on
any Guarantee, or the Transaction Costs covered by the indemnification set forth
in Section 4 of this Agreement. In the case of an "employee benefit plan," as
defined in Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA"), maintained or formerly maintained by the UPC Group for its
employees or former employees in which no employee or former employee of the
Overnite Group has participated, "UPC Liabilities" shall include all liabilities
for any benefits due and payable under the terms of such plans as well as any
Taxes, penalties, interest or other charges imposed by any governmental agency
with respect to the maintenance and administration of such plans. Further, in
case of any employee benefit plan maintained or formerly maintained by the UPC
Group in which employees or former employees of the Overnite Group have
participated, "UPC Liabilities" shall be limited to the portion of the
liability, Tax, penalty, interest or other charge attributable to employees or
former employees of the UPC Group, or in the event that a liability, Tax,
penalty,
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interest or other charge is not attributable to specific employees or former
employees, "UPC Liabilities" shall be limited to the portion of the liability,
Tax, penalty, interest or other charge that bears the same relationship to the
whole thereof as the benefit liabilities under such plan attributable to
employees or former employees of the UPC Group bears to all such benefit
liabilities under the plan, and any costs (including reasonable counsel fees)
imposed upon or incurred by theUPC Group in connection with such liability shall
be allocated in the same manner.
The term "UPC Securities Liabilities" shall mean any Liability under the
1933 Act, the 1934 Act or any other federal or state law or regulation, at
common law or otherwise, arising out of the Offering, and arising out of or
based upon (i) any untrue statement or alleged untrue statement of a material
fact contained in a Registration Statement or Prospectus or (ii) the omission or
alleged omission to state in a Registration Statement or Prospectus a material
fact required to be stated therein or necessary to make the statements made
therein not misleading, but only to the extent that such Liability arises out of
or is based upon any such untrue statement or alleged untrue statement or
omission or alleged omission concerning UPC Information.
2. Purchase and Sale of OHI Shares. (a) UPC agrees that, immediately
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following the Offering, it will sell, transfer and deliver to Overnite, and
Overnite agrees that it will purchase from UPC, free and clear of all liens,
claims, encumbrances, security interests, options, charges and restrictions of
any kind, all of the outstanding OHI Shares for an aggregate cash purchase price
("Purchase Price") of $__________ million./1/
(b) The Closing shall be held at the offices of Cravath, Swaine & Moore,
Worldwide Plaza, 825 Eighth Avenue, New York, NY, or such other place as the
parties may agree. The Acquisition shall not occur unless the Offering first
occurs. At the Closing, (i) Overnite shall pay
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/1/ THIS AMOUNT WILL BE THE GROSS PROCEEDS OF THE OFFERING, LESS UNDERWRITING
DISCOUNTS, PLUS $105 MILLION.
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the Purchase Price to UPC by wire transfer of immediately available funds to an
account designated by UPC, (ii) UPC shall deliver to Overnite certificates
representing the OHI Shares, duly endorsed in blank or accompanied by one or
more stock powers duly endorsed in blank and in proper form for transfer, (iii)
Overnite shall deliver to UPC for filing the fully-executed Section 338 Election
Forms (as defined in Section 12(b) hereof), and (iv) Overnite and UPC shall each
take such further actions and deliver such other documents as may be reasonably
requested by the other party to complete the Acquisition.
(c) Immediately prior to the Closing, the net intercompany balance
reflecting advances between UPC on the one hand, and OTC or OHI on the other,
shall be forgiven and cancelled. To the extent that such net intercompany
balance is less than $148.068 million, Overnite shall make an additional cash
payment to UPC in the amount of such difference. To the extent that such net
intercompany balance is greater than $148.068 million, UPC shall make a cash
payment to Overnite in the amount of such difference. Overnite hereby expressly
consents to the forgiveness and cancellation of such net intercompany balance.
The amount, if any, required under this Section 2(c) shall be payable within 5
Business Days of the date of the Closing.
3. UPC Representations and Warranties. UPC hereby represents and
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warrants, as of the Closing, to Overnite, OHI and OTC as follows:
(a) UPC is duly organized, validly existing and in good standing
under the laws of the jurisdiction of its incorporation, and has full corporate
power and authority to execute and deliver this Agreement and to perform its
obligations hereunder. The execution and delivery of this Agreement by UPC and
the performance of its obligations hereunder have been duly and validly
authorized by all necessary corporate action on the part of UPC, and this
Agreement has been duly and validly executed and delivered by UPC.
(b) This Agreement constitutes the legal, valid and binding
obligation of UPC,
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enforceable against UPC in accordance with its terms, except as limited by
applicable bankruptcy, insolvency, moratorium, reorganization or other similar
laws affecting creditors' rights and remedies generally and general principles
of equity.
(c) Neither the execution and delivery of this Agreement by UPC, nor the
performance of its obligations hereunder, nor the consummation of the
transactions contemplated hereby, will (i) violate any applicable law to which
UPC is subject, (ii) violate or conflict with any provision of the charter or
by-laws of UPC, or (iii) conflict with, result in a breach of, constitute a
default under, result in the acceleration of, create in any party the right to
accelerate, terminate, modify or cancel, or require any notice under, any
agreement, contract, lease, license or instrument to which UPC is a party or by
which it is bound or to which any of its assets is subject, except in each case
for any violation, conflict, breach, default, acceleration, termination,
modification, cancellation or failure to give notice which will not have a
material adverse effect on the ability of UPC to consummate the transactions
contemplated by this Agreement. UPC is not required to give any notice to, make
any filing with, or obtain any authorization, consent or approval of any
governmental entity in order for UPC to consummate the transactions contemplated
by this Agreement, except for any failure to give notice, or to file or obtain
any authorization, consent or approval which would not have an adverse effect on
the ability of UPC to consummate the transactions contemplated by this
Agreement.
(d) There are no outstanding shares of capital stock of OHI other than the
100 OHI Shares held of record and owned beneficially by UPC. UPC owns and holds
of record and beneficially such OHI Shares free and clear of any and all liens,
claims, encumbrances, security interests, options, charges and restrictions of
any kind, other than restrictions on transfer of the OHI Shares imposed under
applicable Federal or State securities laws. All of the OHI Shares have been
duly authorized and are validly issued, fully paid and nonassessable. UPC is not
a party to, and is not otherwise subject to or bound by, any voting trusts,
proxies, or other agreements or
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understandings with respect to the voting of any capital stock of OHI, other
than the rights of Overnite under this Agreement. Except for the rights of
Overnite under this Agreement, there are no outstanding options, warrants or
rights to purchase or acquire, or otherwise entitling the holder thereof to
participate in or otherwise receive any payment based on the value of, any
securities of OHI (including the OHI Shares).
(e) The authorized capital stock of OTC consists of 40 million shares of
common stock, $1.00 par value per share (the "OTC Shares"), of which 1,000 OTC
Shares are validly issued and outstanding, fully paid and nonassessable. OHI is
the sole registered and beneficial holder of the outstanding OTC Shares. None
of the OTC Shares have been issued in violation of, and none of the OTC Shares
is subject to, any preemptive or subscription rights. Except for the OTC
Shares, there are no shares of capital stock or other equity securities of OTC
outstanding. There are no outstanding warrants, options, agreements,
convertible or exchangeable securities or other commitments (other than this
Agreement) pursuant to which UPC or OHI is or may become obligated to sell,
purchase or return any shares of capital stock or other securities of OTC.
3A. Representations and Warranties of Overnite, OHI and OTC.
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Overnite, OHI and OTC hereby represent and warrant, as of the Closing, to UPC as
follows:
(a) Each of Overnite, OHI and OTC is duly organized, validly existing and
in good standing under the laws of the jurisdiction of its incorporation, and
each of Overnite, OHI and OTC has full corporate power and authority to execute
and deliver this Agreement and to perform its obligations hereunder. The
execution and delivery of this Agreement by Overnite, OHI and OTC and the
performance by each of them of their respective obligations hereunder have been
duly and validly authorized by all necessary corporate action on the part of
such party, and this Agreement has been duly and validly executed and delivered
by such party.
(b) This Agreement constitutes the valid, legal and binding obligation of
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Overnite, OHI and OTC, enforceable against each of such parties in accordance
with its terms, except as limited by applicable bankruptcy, insolvency,
moratorium, reorganization or other similar laws affecting creditors' rights and
remedies generally and general principles of equity.
(c) Neither the execution and delivery of this Agreement by Overnite, OHI
or OTC, nor the performance of their respective obligations hereunder, nor the
consummation of the transactions contemplated hereby, will (i) violate any
applicable law to which Overnite, OHI or OTC is subject, (ii) violate or
conflict with any provision of the charter or by-laws of Overnite, OHI or OTC or
(iii) conflict with, result in a breach of, constitute a default under, result
in the acceleration of, create in any party the right to accelerate, terminate,
modify or cancel, or require any notice under any agreement, contract, lease,
license or instrument to which Overnite, OHI or OTC is a party or by which it is
bound or to which any of its assets is subject, except in each case for any
violation, conflict, breach, default, acceleration, termination, modification,
cancellation or failure to give notice which will not have a material adverse
effect on the ability of Overnite, OHI or OTC to consummate the transactions
contemplated by this Agreement. Neither Overnite, OHI nor OTC is required to
give any notice to, make any filing with, or obtain any authorization, consent
or approval of any governmental entity in order for Overnite, OHI or OTC to
consummate the transactions contemplated by this Agreement, except for any
failure to give notice, or to file or obtain any authorization, consent or
approval which would not have a material adverse effect on the ability of
Overnite, OTC or OHI to consummate the transactions contemplated by this
Agreement.
(d) Overnite acknowledges that the OHI Shares being acquired by it
hereunder have not been registered under the 1933 Act or registered or qualified
under applicable state securities laws. The OHI Shares purchased by Overnite
pursuant to this Agreement are being acquired for investment only and not with a
view towards any public distribution thereof, and Overnite will not offer to
sell or otherwise dispose of the OHI Shares so acquired by it in violation of
any of the registration requirements of the 1933 Act or any comparable state
laws.
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4. Indemnification by Overnite. The Overnite Group shall release,
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indemnify, defend and hold harmless the UPC Group and the respective directors,
officers, employees, agents and representatives thereof from and against any and
all losses, claims, damages, liabilities, demands, suits and actions (by any
person), including all reasonable attorneys' fees and disbursements and other
costs and expenses incurred in connection therewith (collectively,
"Indemnifiable Losses"), relating to, resulting from, or arising out of (a) any
Overnite Liabilities, (b) any Overnite Securities Liabilities, (c) any fees and
expenses described in clauses (i), (v), (vi), (vii), (viii), (ix) and (x) of the
definition of Transaction Costs, and (d) any failure by the Overnite Group to
comply with the terms and conditions of this Agreement or any other agreement
executed in connection with the Offering or the Acquisition. No payment by
Overnite pursuant to clauses (a) or (b) of the foregoing sentence shall be
required until such time as the aggregate amount which would be so payable under
such clauses exceeds $25,000, and at such time the entire aggregate amount (and
not only the excess over $25,000) will become payable.
5. Indemnification by the UPC Group. The UPC Group shall release,
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indemnify, defend and hold harmless the Overnite Group and the respective
directors, officers, employees, agents and representatives thereof from and
against any and all Indemnifiable Losses relating to, resulting from, or arising
out of (a) any UPC Liabilities, (b) any UPC Securities Liabilities, (c) any fees
and expenses described in clauses (ii), (iii) and (iv) of the definition of
Transaction Costs, and (d) any failure by UPC to comply with the terms and
conditions of this Agreement or any other agreement executed in connection with
the Offering or the Acquisition. No payment by UPC pursuant to clauses (a) or
(b) of the foregoing sentence shall be required until such time as the aggregate
amount which would be so payable under such clauses exceeds $25,000, and at such
time the entire aggregate amount (and not only the excess over $25,000) will
become payable.
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6. Guarantees, Bonds, Etc. The Overnite Group shall use all reasonable
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efforts to obtain promptly the release of UPC, or the substitution of any member
of the Overnite Group for UPC, on all Guarantees. The Guarantees shall include,
but not be limited to, the agreements listed in Schedule A hereto, and any
renewals thereof or substitutions therefor. UPC shall cooperate with the
Overnite Group in obtaining such releases or substitutions, provided that it
shall not be required to incur any non-de minimis liability or unreimbursed
expense in doing so. The Overnite Group agrees to indemnify, defend and hold
harmless the UPC Group, and the directors, officers, employees, agents and
representatives thereof, from and against any Indemnifiable Losses relating to,
resulting from, or arising out of, any Guarantee. UPC shall be subrogated to the
rights of any beneficiary of a Guarantee against the Overnite Group to the
extent that UPC is required to make any payment under such Guarantee. UPC agrees
not to unilaterally terminate or withdraw any Guarantee and agrees to abide by
the terms of the Guarantees if, to UPC's knowledge after reasonable inquiry,
such termination, withdrawal or non-compliance would cause more than a de-
minimis liability to the Overnite Group or result in the Overnite Group's
default under or violation of the terms of any agreement with a third party.
7. Collateral. (a) So long as the Guaranty relating to the Japanese
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Lease Financing, identified as Item 1 on Schedule A hereto, remains in effect or
otherwise continues to apply to UPC, Overnite agrees that it shall meet the
financial covenants which are contained in Article VI of the Bank Credit
Agreement as if such covenants were set forth in this Agreement. During the
period that Overnite is required to comply with the foregoing covenants under
the terms hereof, the Overnite Group shall promptly notify UPC if it ever fails
to comply with any such covenant, and shall furnish to UPC such information
respecting the condition or operations, financial or otherwise, of the Overnite
Group, as UPC may from time to time reasonably request.
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(b) In the event that the Overnite Group fails to comply with Section 5(a),
UPC may request, and the Overnite Group shall promptly deposit with UPC,
Collateral (as defined below) having a value equal to the maximum amount then
payable upon termination of the Japanese Leveraged Lease referred to above,
including any repayment of debt or equity investment required in connection with
such termination. For purposes of this Agreement, the term ACollateral@ shall
mean (i) cash; (ii) U.S. Treasury Bills maturing not more than 180 days from the
date of delivery thereof by the Overnite Group to UPC; (iii) commercial paper
(other than the commercial paper of a party hereto or its Affiliates)
denominated in U.S. dollars, provided that such commercial paper (A) continues
to be rated at least "A-1" by Standard & Poor's Corporation and AP-1" by Moody's
Investors Service Inc., or the equivalent ratings by two nationally recognized
investment rating services, or, if unrated, is guaranteed by a company having
outstanding commercial paper that is so rated, (B) remains readily marketable
and is not convertible into capital stock, and (C) matures not more than 180
days from the date of delivery to UPC; (iv) an irrevocable standby letter of
credit, in a form and issued by a bank reasonably acceptable to UPC; and (v) any
payments or other distributions received with respect to any of the aforesaid
Collateral. For purposes of this Agreement, non-cash Collateral shall be valued
at market value, except that any letters of credit shall be valued at the face
amount thereof. The Overnite Group shall deposit any Collateral no later than
one Business Day following the date UPC's request therefor is received, into one
or more accounts identified by UPC which reasonably identify the Overnite
Group's ownership interest and UPC's security interest in such Collateral.
(c) If on any Business Day the value of the aggregate Collateral then on
deposit exceeds the Collateral required to be on deposit pursuant to this
Agreement, then UPC, within one Business Day of the Overnite Group's demand
therefor, shall return such excess amount of Collateral to the Overnite Group;
provided, however, that UPC shall not be required to return Collateral that it
would otherwise be obligated to return to the extent any claims have been
asserted against UPC
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for payment under the Guaranty referred to in Section 7(a) above or if the
Overnite Group has failed to make any indemnity payment required under this
Agreement with respect to such Guaranty. UPC may, at its option, satisfy its
obligation under this Section 7(c) through the return of cash or non-cash
Collateral, or both.
(d) The Overnite Group shall earn interest on its cash Collateral from and
including the date of deposit to but excluding the date such Collateral is
returned at a rate per annum equal to the rate at which the account designated
by UPC actually bears interest (UPC to use reasonable efforts to obtain the
highest interest rate for liquid deposits in such amount from time to time
offered by its bank). Such interest shall be calculated in accordance with the
usual practices of the bank at which such account is established. UPC shall
remit interest to an account designated by the Overnite Group within three
Business Days of its demand therefor; provided that such payment shall not be
required more frequently than on a quarterly basis.
(e) In the event the Collateral requirements of this Section 7 are
applicable, as security for the payment of all amounts due or that may become
due by the Overnite Group to or on behalf of UPC in accordance with this
Agreement with respect to the Guaranty referred to in Section 7(a), above, the
Overnite Group hereby grants to UPC a security interest in all Collateral and
all payments thereon and proceeds thereof, and additions thereto and
substitutions therefor, which are and may hereafter be delivered or otherwise
transferred to UPC by the Overnite Group in accordance with the provisions of
this Agreement, and the Overnite Group hereby agrees to take all actions
reasonably requested by UPC in order to perfect the security interest granted
hereunder. UPC may apply Collateral on deposit with it pursuant to this Section
7 to satisfy the indemnity obligations of the Overnite Group with respect to the
Guaranty referred to in Section 7(a), above, if and when payment of such amounts
has not been made or received.
8. Third Party Claims. (a) If any person entitled to indemnification
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under this
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Agreement (an "Indemnitee") receives notice of the assertion of any
claim or of the commencement of any action or proceeding by any person that is
not a party to this Agreement or a subsidiary of any such party (a "Third Party
Claim") against such Indemnitee, the Indemnitee shall promptly provide written
notice thereof (including a description of the Third Party Claim and an estimate
of any Indemnifiable Losses (which estimate shall not be conclusive as to the
final amount of such Indemnifiable Losses)) to the party required to provide
indemnification under this Agreement (the "Indemnifying Party") within 10
calendar days after the Indemnitee's receipt of notice of such Third Party
Claim. Any delay by the Indemnitee in providing such written notice shall not
relieve the Indemnifying Party of any liability for indemnification hereunder
except to the extent that the rights of the Indemnifying Party are materially
prejudiced by such delay.
(b) The Indemnifying Party shall have the right to participate in or,
by giving written notice to the Indemnitee, to assume the defense of any Third
Party Claim at such Indemnifying Party's expense and by such Indemnifying
Party's own counsel (which shall be reasonably satisfactory to the Indemnitee),
and the Indemnitee will cooperate in good faith in such defense. The Indemnitee
may retain its own counsel with respect to such Third Party Claims, but the
Indemnifying Party shall not be liable for any legal expenses incurred by the
Indemnitee after the Indemnitee has received notice of the Indemnifying Party's
intent to assume the defense of a Third Party Claim, unless the named parties to
such Third Party Claim (including any impleaded parties) include both the
Indemnifying Party and the Indemnitee and representation of both parties by the
same counsel would be inappropriate due to actual or potential differing
interests between them. If the Indemnifying Party fails to take steps reasonably
necessary to diligently pursue the defense of such Third Party Claim within 10
days of receipt of notice from the Indemnitee that such steps are not being
taken, the Indemnitee may assume its own defense and the Indemnifying Party
shall be liable for the reasonable costs thereof.
(c) The Indemnifying Party may settle any Third Party Claim which it
has
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elected to defend so long as the written consent of the Indemnitee to such
settlement is first obtained (which consent shall not be unreasonably withheld).
The Indemnified Party shall not settle any Third Party Claim without the written
consent of the Indemnifying Party unless the Indemnifying Party elects not to
defend such Third Party Claim.
(d) In the event that a Third Party Claim involves a proceeding as to
which both the UPC Group and the Overnite Group may be Indemnifying Parties, the
parties hereto agree to cooperate in good faith in a joint defense of such Third
Party Claim.
(e) Notwithstanding subsections (b), (c), and (d) of this Section 8,
the provisions of Article IV, V, and VI of that certain Tax Allocation Agreement
entered into by Union Pacific Corporation, Overnite, OHI, and OTC of even date
herewith (the "Tax Allocation Agreement") shall control and supercede this
Agreement with respect to any Third Party Claim by a taxing authority.
9. Contribution. If the indemnification provided for in this Agreement
------------
with respect to Overnite Securities Liabilities or UPC Securities Liabilities is
for any reason held by a court or other tribunal to be unavailable on policy
grounds or otherwise, the UPC Group and the Overnite Group shall contribute to
the Indemnifiable Losses in such proportion as to reflect each party's relative
fault in connection with such Indemnifiable Losses. The relative fault of the
parties shall be determined by reference to, among other things, whether the
conduct or information giving rise to the Indemnifiable Losses is attributable
to the UPC Group or the Overnite Group and each party's relative intent, access
to information and opportunity to prevent or correct the Indemnifiable Losses.
No person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the 1933 Act) shall be entitled to contribution from any person who is
not guilty of fraudulent misrepresentation.
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10. Cooperation. So long as any books, records and files retained by the
-----------
UPC Group or the Overnite Group relating to the present or past businesses,
operations or assets of the Overnite Group remain in existence and available,
the UPC Group and the Overnite Group shall have the right upon prior written
notice to inspect and copy the same at any time during business hours for any
proper purpose, provided that such right will not extend to any books, records
and files, disclosure of which in accordance herewith would result in a waiver
of the attorney-client, work product or other privileges which permit non-
disclosure of otherwise relevant material in litigation or other proceedings, or
which are subject on the date hereof and at the time inspection is requested to
a non-disclosure agreement with a third party and a waiver cannot reasonably be
obtained, provided that, in the case of material requested of the Overnite
Group, such request relates only to the businesses, operations or assets of the
Overnite Group as constituted on or prior to Closing or books, records and files
reasonably required by the UPC Group for tax, accounting or financial reporting
purposes or to enforce its rights under this Agreement or any other agreement
executed by the Overnite Group and the UPC Group in connection with the Offering
or Acquisition. The UPC Group and the Overnite Group agree that they shall not
destroy any such books, records or files without reasonable notice to the other
party or if such party receives within 10 days of such notice any reasonable
objection from the other party to such destruction. Except in the case of
dispute between the parties hereto, the UPC Group and the Overnite Group shall
cooperate with one another in a timely manner in any administrative or judicial
proceeding involving any matter affecting the actual or potential liability of
either party hereunder. Such cooperation shall include, without limitation,
making available to the other party during normal business hours all books,
records and information, and officers and employees (without substantial
disruption of operations or employment) necessary or useful in connection with
any inquiry, audit, investigation or dispute, any litigation or any other matter
requiring any such books, records, information, officers or employees for any
reasonable business purpose. The party requesting or otherwise entitled to any
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books, records, information, officers or employees pursuant to this Section 10
shall bear all reasonable out-of-pocket costs and expenses (except for salaries,
employee benefits and general overhead) incurred in connection with providing
such books, records, information, officers or employees. Notwithstanding the
foregoing, the provisions of this Section 10 shall not affect the rights and
obligations of the parties under the Tax Allocation Agreement.
11. Section 338 Elections and Related Matters. (a) Overnite agrees
-----------------------------------------
(i) to make timely joint elections with UPC under Section 338(h)(10) of the Code
and the regulations thereunder with respect to the Acquisition and the deemed
acquisition of OTC (the "Section 338(h)(10) Elections"), and (ii) to make (or to
cause the appropriate affiliate or affiliates of Overnite to make) any and all
similar elections available under any applicable state or local law with respect
to the Acquisition and the deemed acquisition of OTC (the "Section 338(h)(10)
Subelections"). Overnite further agrees (x) to cause to be made express
elections under Section 338(g) of the Code and the regulations thereunder to the
extent necessary to allow the Section 338(h)(10) Elections to be made (the
"Section 338(g) Elections"), and (y) to make any and all similar elections
available under any applicable state or local law, to the extent necessary to
allow any Section 338(h)(10) Subelection to be made (the "Section 338(g)
Subelections").
(b) As requested from time to time by UPC (whether before, at, or
after the Closing), Overnite shall assist UPC in, and shall provide the
necessary information to UPC in connection with, the preparation of Internal
Revenue Service Form 8023, Elections Under Section 338 For Corporations Making
Qualified Stock Purchases, and any comparable or related forms required under
any applicable state or local law, and the required schedules or statements
thereto (the "Section 338 Election Forms") relating to the Section 338(h)(10)
Elections and the Section 338(g) Elections and any Section 338(h)(10)
Subelections and any Section 338(g) Subelections. Without limiting the
generality of the preceding sentence and with respect to each Section 338
Election Form
-18-
delivered by UPC to Overnite on or before the Closing, Overnite shall, no later
than the Closing, cause each such Section 338 Election Form to be duly executed
by Overnite or an affiliate of Overnite, as appropriate, and shall deliver the
same to UPC at the Closing. If UPC determines at or after the Closing that any
change is to be made in a Section 338 Election Form previously executed by
Overnite or an affiliate of Overnite and delivered by Overnite to UPC, then UPC
may prepare a new Section 338 Election Form and deliver such new Section 338
Election Form to Overnite, and Overnite shall cause such Section 338 Election
Form to be duly executed by Overnite or an affiliate of Overnite, as
appropriate, and shall promptly deliver such executed Section 338 Election Form
to UPC.
(c) UPC shall timely file (or cause to be filed) the Section 338
Election Forms on behalf of UPC and Overnite, and shall provide notice of such
filing to Overnite. UPC and Overnite shall thereafter take any and all actions
necessary or appropriate to effect the timely filing of any other Section 338
Election Forms required to be filed for any applicable state or local tax
purposes.
(d) With respect to the filings described in Section 11 (c) above,
Overnite, OHI, OTC and UPC will (i) treat as valid the Section 338(h)(10)
Elections and the Section 338(g) Elections with respect to the Acquisition and
the deemed acquisition of OTC, and any Section 338(h)(10) Subelections and any
Section 338(g) Subelections, (ii) not take any action inconsistent with such
treatment, and (iii) timely file, or cause to be filed, all tax returns affected
by such filings in a manner consistent with the Section 338(h)(10) Elections and
the Section 338(g) Elections and any Section 338(h)(10) Subelections and any
Section 338(g) Subelections (including but not limited to attaching such Section
338 Election Forms and the schedules related thereto to the appropriate tax
returns in the manner prescribed by applicable regulations or other applicable
law).
(e) Overnite, OHI, and OTC, on the one hand, and UPC, on the other
hand, shall cooperate and consult with each other in good faith in order to
reach a mutually acceptable agreement with respect to the allocation of the
Purchase Price among the assets of Overnite, OHI,
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and OTC for purposes of the Section 338 Election Forms.
12. Use of Union Pacific Name; Shield. The Overnite Group hereby agrees
---------------------------------
that it will not use or authorize or permit any other person to use the name
"Union Pacific," including any logo, trademark or design containing such name,
or the Union Pacific shield or similar design, at any time after the 30/th/ day
following the Closing.
13. Assignment. Neither party may assign any of its rights or delegate
----------
any of its duties under this Agreement without first obtaining the prior written
consent of the other party, which may be withheld by such other party in its
absolute discretion. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their successors and permitted assigns.
14. Notices. All notices and other communications to be given hereunder
-------
shall be in writing and delivered in person or mailed postage prepaid or sent by
telegram or other facsimile transmission to the following addresses:
If to UPC:
Union Pacific Corporation
1717 Main Street
Suite 5900
Dallas, Texas 75201
Attn: Senior Vice President and General Counsel
Telecopy No.: (214)743-5741
If to Overnite, OHI or OTC:
Overnite Corporation
1000 Semmes Avenue
Richmond, VA 23224-2246
Attn: Senior Vice President and Chief Financial Officer
Telecopy No.: (804) 231-8501
-20-
or to such other addresses as either party may designate in writing. All notices
or communications shall be effective upon receipt.
15. No Third Party Beneficiaries. The provisions of this Agreement are
----------------------------
intended solely to establish the relative rights and responsibilities between
the UPC Group and the Overnite Group, and except as set forth in the provisions
of this Agreement which expressly provide for the indemnification of members of
the UPC Group or the Overnite Group, or the respective directors, officers,
employees, agents and representatives thereof, nothing in this Agreement,
express or implied, is intended or will be construed to confer upon or give any
person other than the parties hereto and their respective successors and
permitted assigns any rights, remedies or obligations under or by reason of this
Agreement or any transaction contemplated hereby.
16. Governing Law. This Agreement shall be governed by and construed in
-------------
accordance with laws of the State of New York, without giving effect to the
principles of conflicts of law thereof.
17. Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which when so executed shall be deemed an original and all
of which shall together constitute but one and the same instrument.
18. Entire Agreement. This Agreement constitutes the entire agreement of
----------------
the parties with respect to the subject matter hereof and supersedes all prior
agreements and understandings, oral or written, with respect to such matters.
This Agreement may not be amended or otherwise modified except by a written
instrument duly executed and delivered by all parties. No failure or delay by
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.
19. Severability. The provisions of this Agreement are severable, and
------------
should any
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provision hereof be void, voidable or unenforceable under any applicable law,
such provision shall not affect or invalidate any other provision of this
Agreement, which shall continue to govern the relative rights and duties of the
parties as though such void, voidable or unenforceable provision were not a part
hereof.
20. Incorporation of Schedules. The Schedules identified in and attached
--------------------------
to this Agreement are hereby incorporated by reference and made a part hereof.
-22-
IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement as
of the date first above written.
UNION PACIFIC CORPORATION
By: _____________________________
Title: ___________________________
OVERNITE CORPORATION
By: _____________________________
Title: ___________________________
OVERNITE HOLDING, INC.
By: _____________________________
Title: ___________________________
OVERNITE TRANSPORTATION COMPANY
By: _____________________________
Title: ___________________________
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SCHEDULE A
TO
Indemnification Agreement, dated as of August ____, 1998
among
Union Pacific Corporation ("UPC"),
Overnite Corporation,
Overnite Holding, Inc. ("OHI") and Overnite Transportation Company ("OTC")
1. Union Pacific Guaranty Agreement, dated as of March 18, 1994, between
Richmond Truck Lease Co., Ltd. and UPC concerning the Japanese leveraged
lease financing of trucks.
2. Guaranty, dated October 29, 1993, by UPC of OTC's self-insured worker's
compensation obligations in Pennsylvania.
3. Guaranty, dated December 28, 1993, by UPC of OTC's self-insured worker's
compensation obligations in Missouri.
4. Guaranty, dated July 21, 1995, by UPC of OTC's self-insured worker's
compensation obligations in West Virginia.
5. Guaranty, dated June 28, 1988, by UPC of OTC's self-insured worker's
compensation obligations in Alabama.
6. Guaranty, dated June 28, 1988, by UPC of OTC's self-insured worker's
compensation obligations in North Carolina.
7. Indemnity Agreement, made the 1/st/ day of January, 1991 by and between
National Union Fire Insurance Company of Pittsburgh and UPC, and any letter
of credit, surety bond, or other security provided by UPC pursuant thereto.
A-1
Dates Referenced Herein and Documents Incorporated by Reference
| Referenced-On Page |
|---|
| This ‘S-1/A’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| Filed on: | | 7/22/98 | | | | | | | None on these Dates |
| | 7/21/95 | | 24 |
| | 3/18/94 | | 24 |
| | 12/28/93 | | 24 |
| | 10/29/93 | | 24 |
| List all Filings |
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