Amended And Restated Registration Rights Agreement

EXECUTION COPY


AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT


AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (the "Amended and Restated Registration Rights Agreement") dated as of June 5, 1998 by and among Gerber Childrenswear, Inc., a Delaware corporation (the "Company"), GCIH, Inc., a Delaware corporation ("GCIH") and owner of 100% of the capital stock of the Company, Citicorp Venture Capital, Ltd., a New York corporation ("CVC"), Citicorp Mezzanine Partners, L.P., a Delaware limited partnership ("CMP"), CCT III Partners, L.P., a Delaware limited partnership ("CCT"), Edward Kittredge, Richard Solar, and David Uren (such three individuals, collectively, the "Executive Officers").


WHEREAS, GCIH, CVC, CMP, CCT, the Executive Officers, and certain others are parties to a registration rights agreement dated as of January 22, 1996, and as amended from time to time (the "Original Registration Rights Agreement");


WHEREAS, the parties hereto constitute holders of a majority of Registrable Securities (as such term is defined in the Original Registration Rights Agreement), and such parties wish to amend and restate the Original Registration Rights Agreement in its entirety;


WHEREAS, the Boards of Directors of GCIH and the Company have approved a merger of GCIH into the Company, with the Company as the surviving corporation (the "Merger"), whereby (a) holders of the Series A Preferred Stock, par value $0.01 per share of GCIH shall receive either Class B Common Stock of the Company or the right to receive cash, (b) the holders of shares of Class A Common Stock, par value $0.01 per share of GCIH shall become holders of the Class B Common Stock (as defined in Section 1 hereof), of the Company, (c) the holders of the shares of Class B Common Stock, par value $0.01 per share of GCIH shall become holders of the Common Stock (as defined in Section 1 hereof) of the Company, (d) holders of the Class C Common Stock, par value $0.01 per share of GCIH shall become holders of shares of Common Stock of the Company, and (e) the holders of warrants to purchase the Class D Common Stock, par value $0.01 per share of GCIH (the "CMP Warrants") shall become holders of warrants to purchase the Class B Common of the Company;


WHEREAS, immediately following the consummation of the Merger, the Company intends to file a Form S-1 under the Securities Act (as hereinafter defined) for registration of certain shares of its Common Stock (the "Initial Public Offering"); and


WHEREAS, in order to provide for and to clarify and restate the rights and obligations of the parties hereto upon consummation of the Merger and the Initial Public Offering, the parties hereto have entered into this agreement, which shall become effective upon consummation of the Merger (such consummation, the "Effective Time"), and immediately prior to the Initial Public Offering and upon its effectiveness shall cause the Original Registration Rights Agreement to cease to exist and be amended and restated in its entirety; 2


NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Agreement hereby agree as follows:


1. Definitions. As used herein, the following terms shall have the following meanings.


"CMP Registrable Securities" means (i) any shares of Common Stock issued or issuable upon exercise of any portion of the CMP Warrants or acquired by CMP, its affiliates (other than CVC, CCT and the Individual Purchasers) or their respective affiliates on or after January 22, 1996 and (ii) any shares of capital stock of the Company issued or issuable with respect to the securities referred to in clause (i) by way of a stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization, in each of case (i) and (ii), which shares have not been registered under the Securities Act. For purposes of this Agreement, a Person will be deemed to be a holder of CMP Registrable Securities whenever such Person has the right to acquire directly or indirectly such CMP Registrable Securities (upon conversion or exercise in connection with a transfer of securities or otherwise, but disregarding any restrictions or limitations upon the exercise of such right), whether or not such acquisition has actually been effected.


"Class B Common" means, collectively, (i) the Class B Common Stock of the Company, par value $0.01 per share, and (ii) any capital stock of the Company issued or issuable with respect to the securities referred to in clause (i) by way of a stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization.


"Common Stock" means, collectively, (i) the Common Stock of the Company, par value $0.01 per share, and (ii) any capital stock of the Company issued or issuable with respect to the securities referred to in clause (i) by way of a stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization.


"CVC Registrable Securities" means (i) any shares of Stock of the Company acquired by CVC or its affiliates (other than CMP and the Individual Purchasers) on or after January 22, 1996, and (ii) any shares of capital stock of the Company issued or issuable with respect to the securities referred to in clause (i) above by way of a stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization, in each of case (i) and (ii), which shares have not been registered under the Securities Act. For purposes of this Agreement, a Person will be deemed to be a holder of CVC Registrable Securities whenever such Person has the right to acquire directly or indirectly such CVC Registrable Securities (upon conversion or exercise in connection with a transfer of securities or otherwise, but disregarding any restrictions or limitations upon the exercise of such right), whether or not such acquisition has actually been effected.


"Exchange Act" means the Securities Exchange Act of 1934, as amended.


"Executive Registrable Securities" means (i) any shares of Common Stock issued or issuable to the Executives on or after January 22, 1996, if and to the extent such shares of


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Common Stock have vested pursuant to the terms of the Executive Stock Purchase Agreements executed by such Executives and the Company and (ii) any shares of capital stock of the Company issued or issuable with respect to the securities referred to in clause (i) above by way of a stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization, in each of case (i) and (ii), which shares have not been registered under the Securities Act. For purposes of this Agreement, a Person will be deemed to be a holder of Executive Registrable Securities whenever such Person has the right to acquire directly or indirectly such Executive Registrable Securities (upon conversion or exercise in connection with a transfer of securities or otherwise, but disregarding any restrictions or limitations upon the exercise of such right), whether or not such acquisition has actually been effected.


"Executives" means collectively the Executive Officers and certain executives of the Company who have acquired or will acquire capital stock of the Company and who have executed or will execute a joinder to the Original Registration Rights Agreement or this Amended and Restated Registration Rights Agreement, as the case may be.


"Holders Securities" means any securities held by CVC or any of its affiliates (other than CMP) which are exchangeable, convertible or otherwise similarly exercisable into Registrable Securities.


"Individual Purchasers" means Richard Cashin, 63 BR Partnership, Charles E. Corpening, Michael A. Delaney, David Y. Howe, Byron L. Knief, Alchemy, L.P., M. Saleem Muqaddam, David F. Thomas, and John Weber.


"Investor" means Lawrence R. Glenn.


"Person" means an individual, a partnership, a corporation, an association, a joint stock company, a limited liability company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof.


"Purchaser Registrable Securities" means (i) any shares of Common Stock issued or issuable to the Individual Purchasers or the Investor or acquired by, or issued or issuable to, the Individual Purchasers or the Investor by way of a stock dividend or stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization, in each of case (i) and (ii), which shares have not been registered under the Securities Act. For purposes of this Agreement, a Person will be deemed to be a holder of Purchaser Registrable Securities whenever such Person has the right to acquire directly or indirectly such Purchaser Registrable Securities (upon conversion or exercise in connection with a transfer of securities or otherwise, but disregarding any restrictions or limitations upon the exercise of such right), whether or not such acquisition has actually been effected.


"Qualified Public Offering" means the sale, in an underwritten public offering registered under the Securities Act, of shares of the Company's Common Stock having an aggregate value of at least $30 million.


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"Registrable Securities" means, collectively, the CVC Registrable Securities, the Purchaser Registrable Securities, the CMP Registrable Securities, and the Executive Registrable Securities.


"Registration Expenses" means all expenses incident to the Company's performance of or compliance with this Agreement, including without limitation all registration and filing fees, fees and expenses of compliance with securities or blue sky laws, printing expenses, messenger and delivery expenses, and fees and disbursements of counsel for the Company and all independent certified public accountants, underwriters (excluding discounts and commissions and other similar fees described in the underwriting agreement) and other Persons retained by the Company.


"Rule 144" means Rule 144 under the Securities Act (or any similar rule then in force).


"SEC" means the Securities and Exchange Commission.


"Securities Act" means the Securities Act of 1933, as amended.


"Stock" means collectively, (i) the Common Stock and Class B Stock, and (ii) any capital stock of the Company issued or issuable with respect to the securities referred to in clause (i) by way of a stock split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization.


2. Demand Registrations.


(a) Requests for Registration. Subject to Section 2(b) below, (i) at any time and from time to time, the holders of a majority of the CVC Registrable Securities and (ii) at any time after the earlier of (x) the fifth anniversary hereof or (y) the six month anniversary of the consummation of a Qualified Public Offering, the holders of a majority of the CMP Registrable Securities, respectively, may request registration, whether underwritten or otherwise, under the Securities Act of all or part of their Registrable Securities on Form S-1 or any similar long-form registration ("Long-Form Registrations") or on Form S-2 or S-3 or any similar short-form registration ("Short-Form Registrations") if available. In addition, subject to Section 2(g) below, the holders of a majority of the CVC Registrable Securities may request that the Company file with the SEC a registration statement under the Securities Act on any applicable form pursuant to Rule 415 under the Securities Act (a "415 Registration"). Each request for a Long-Form Registration or Short-Form Registration shall specify the approximate number of Registrable Securities requested to be registered and the anticipated per share price range for such offering. Within ten days after receipt of any such request for a Long-Form Registration or Short-Form Registration, the Company will give written notice of such requested registration to all other holders of Registrable Securities and will include (subject to the provisions of this Agreement) in such registration, all Registrable Securities with respect to which the Company has received written requests for inclusion therein within 20 days after the receipt of the Company's notice.


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All registrations requested pursuant to in this Section 2(a) are referred to herein as "Demand Registrations". The Company acknowledges that the holders of the CVC Registrable Securities may request a Demand Registration in connection with a public offering of Holders Securities.


(b) Long-Form Registrations. (i) The holders of a majority of the CVC Registrable Securities will be entitled to request up to five (5) Long-Form Registrations and (ii) the holders of a majority of the CMP Registerable Securities will be entitled to request one (1) Long-Form Registration, respectively, in which the Company will pay all Registration Expenses. A registration will not count as the permitted Long-Form Registration until it has become effective and unless the holders of Registrable Securities are able to register and sell at least 90% of the Registrable Securities requested to be included in such registration.


(c) Short-Form Registrations. In addition to the Long-Form Registrations provided pursuant to Section 2(b), (i) the holders of the CVC Registrable Securities will be entitled to request an unlimited number of Short-Form Registrations and (ii) the holders of a majority of CMP Registerable Securities will be entitled to request an unlimited number of Short-Form Registrations, respectively, in which the Company will pay all Registration Expenses. Demand Registrations (other than 415 Registrations) will be Short-Form Registrations whenever the Company is permitted to use any applicable short form. After the Company has become subject to the reporting requirements of the Exchange Act, the Company will use its best efforts to make Short-Form Registrations available for the sale of Registrable Securities.


(d) Priority on Demand Registrations. The Company will not include in any Long-Form Registration or Short-Form Registration any securities which are not Registrable Securities without the prior written consent of the holders of at least a majority of the Registrable Securities included in such registration. If a Long-Form Registration or a Short-Form Registration is an underwritten offering and the managing underwriters advise the Company in writing that in their opinion the number of Registrable Securities and, if permitted hereunder, other securities requested to be included in such offering exceeds the number of Registrable Securities and other securities, if any, which can be sold therein without adversely affecting the marketability of the offering, the Company will include in such registration (i) first, the number of Registrable Securities requested to be included in such registration pro rata, if necessary, among the holders of Registrable Securities based on the number of shares of Registrable Securities owned by each such holder and (ii) second, any other securities of the Company requested to be included in such registration pro rata, if necessary, on the basis of the number of shares of such other securities owned by each such holder. Any Persons other than holders of Registrable Securities who participate in Demand Registrations which are not at the Company's expense must pay their share of the Registration Expenses as provided in Section 6 hereof.


(e) Restrictions on Demand Registrations. The Company will not be obligated to effect any Demand Registration within six months after the effective date of a previous Demand Registration.


(f) Selection of Underwriters. In the case of a Demand Registration for an underwritten offering, the holders of a majority of the Registrable Securities to be included in such


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Demand Registration will have the right to select the investment banker(s) and manager(s) to administer the offering, which investment banker(s) and manager(s) will be nationally recognized, subject to (i) the Company's approval which will not be unreasonably withheld and (ii) the negotiation of an underwriting agreement reasonably acceptable to the Company.


(g) 415 Registrations.


(i) The holders of a majority of the CVC Registrable Securities will be entitled to request one (1) 415 Registration in which the Company will pay all Registration Expenses. Subject to the availability of required financial information, within 45 days after the Company receives written notice of a request for a 415 Registration, the Company shall file with the SEC a registration statement under the Securities Act for the 415 Registration. The Company shall use its best efforts to cause the 415 Registration to be declared effective under the Securities Act as soon as practical after filing, and once effective, the Company shall (subject to the provisions of clause (ii) below) cause such 415 Registration to remain effective for such time period as is specified in such request, but for no time period longer than the period ending on the earlier of (i) the third anniversary of the date of filing of the 415 Registration or (ii) the date on which all CVC Registrable Securities have been sold pursuant to the 415 Registration or (iii) the date as of which there are no longer any CVC Registrable Securities in existence.


(ii) If the holders of a majority of the CVC Registrable Securities notify the Company in writing that they intend to effec ...