Exhibit 10.1

EXECUTION COPY

 

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SECOND AMENDED AND RESTATED

SECURITYHOLDERS AGREEMENT

dated as of

February 27, 2006

among

AMERICAN SEAFOODS, L.P.,

ASC MANAGEMENT, INC.,

ASLP ACQUISITION LLC,

CP3 TAX-EXEMPT HOLDINGS CORP.,

ASC OFFSHORE HOLDINGS CORP.,

COASTAL VILLAGES POLLOCK LLC,

THE ADDITIONAL SECURITYHOLDERS

and

THE INITIAL MANAGEMENT SECURITYHOLDERS

 

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TABLE OF CONTENTS

 

          Page ARTICLE I    DEFINITIONS   

Section 1.1

   Definitions    2 ARTICLE II    RESTRICTIONS ON TRANSFER   

Section 2.1

   In General.    9

Section 2.2

   Additional Restrictions.    11 ARTICLE III    ADDITIONAL RIGHTS AND
OBLIGATIONS OF SECURITYHOLDERS AND THE PARTNERSHIP   

Section 3.1

   Rights of Inclusion.    11

Section 3.2

   Right of First Offer.    13 ARTICLE IV       17

Section 4.1

   Rights Upon Issuance of Additional Securities.    17

Section 4.2

   Issuance Notice    17

Section 4.3

   Response Notice    18

Section 4.4

   Revised Issuance Notice    18

Section 4.5

   Pro Rata Share    18

Section 4.6

   Limitation on Foreign Ownership    18 ARTICLE V    CREATION OF PUBLICLY
TRADED ENTITY   

Section 5.1

   In General.    19

Section 5.2

   Specific Alternatives.    19

Section 5.3

   Procedures and Obligations.    21 ARTICLE VI    TERMINATION   

Section 6.1

   Termination.    22

 

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Table of Contents

(continued)

 

          Page

ARTICLE VII

   BOARD COMPOSITION   

Section 7.1

   Coastal Board Rights.    23

Section 7.2

   Acquisition Board Rights.    24

Section 7.3

   Management Securityholders’ Board Rights.    25

Section 7.4

   Bodal Board Rights.    25

Section 7.5

   Board Composition Following Public Liquidity Event.    26

Section 7.6

   Number of Board Members; Classification.    26

Section 7.7

   Resignation and Removal.    26

Section 7.8

   Independent Directors.    27

Section 7.9

   Election by General Partner.    28

Section 7.10

   Committees.    28 ARTICLE VIII    OTHER MATTERS   

Section 8.1

   Confidential Information.    29

Section 8.2

   Fisheries and Vessel Documentation Matters.    29

Section 8.3

   Remedies    30

Section 8.4

   Rights and Obligations of Transferees; New Issuances.    30

Section 8.5

   Spousal Consent    31

Section 8.6

   Successors and Assigns    31

Section 8.7

   No Waivers; Amendments.    31

Section 8.8

   Certain Consents; Major Transactions.    32

Section 8.9

   Voting of Blocker Shares.    33

Section 8.10

   Notices    33

Section 8.11

   Inspection    35

Section 8.12

   Governing Law; Submission to Jurisdiction    35

Section 8.13

   Confidentiality    35

Section 8.14

   Captions    35

Section 8.15

   Entire Agreement    35

Section 8.16

   Severability    36

Section 8.17

   Counterparts    36

Section 8.18

   Waiver of Jury Trial    36

Section 8.19

   Further Assurances    36

Schedule I – Additional Securityholders

Schedule II – Initial Management Securityholders

Schedule III – Registration Rights

Schedule IV – Acquisition LLC Members

Exhibit A – Board and Committee Members

 

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SECOND AMENDED AND RESTATED

SECURITYHOLDERS AGREEMENT

This SECOND AMENDED AND RESTATED SECURITYHOLDERS AGREEMENT (this “Agreement”) is
dated as of February 27, 2006, and entered into by and among American Seafoods,
L.P., a Delaware limited partnership (the “Partnership”), ASC Management, Inc.,
a Delaware corporation (together with its Transferees, the “General Partner”),
ASLP Acquisition LLC, a Delaware limited liability company (“Acquisition”), CP3
Tax-Exempt Holdings Corp., a Delaware corporation (“CP3”), ASC Offshore Holdings
Corp., a Delaware corporation (“ASC Offshore” and, together with CP3, the
“Blocker Corporations”), Coastal Villages Pollock LLC, an Alaska limited
liability company (“Coastal”), the individuals and entities listed on Schedule I
attached hereto (such individuals and entities, together with Acquisition,
Coastal and the Subsequent Additional Securityholders (as hereinafter defined),
the “Additional Securityholders”), and the individuals listed on Schedule II
attached hereto (the “Initial Management Securityholders” and, together with the
Additional Management Securityholders (as hereinafter defined), the “Management
Securityholders,” it being understood that at such time as any Management
Securityholder ceases to be a member of management of the Partnership or its
subsidiaries, such Management Securityholder shall thereafter be treated as an
Additional Securityholder hereunder unless the context clearly requires
otherwise). Each of the General Partner, the Blocker Corporations, the
Additional Securityholders, the Management Securityholders and any other Person
who shall become a party to or agree to be bound by (or otherwise becomes bound
by) the terms of this Agreement after the date hereof is sometimes hereinafter
referred to as a “Securityholder.”

W I T N E S S E T H:

WHEREAS, the General Partner and the Securityholders are parties to an Amended
and Restated Limited Partnership Agreement of American Seafoods, L.P., dated as
of the date hereof (as amended from time to time, the “Partnership Agreement;”
any capitalized term used herein without definition shall have the meaning set
forth in the Partnership Agreement);

WHEREAS, certain of such parties are party to an Amended and Restated
Securityholders Agreement, dated as of October 4, 2002 (the “Securityholders
Agreement”), setting forth certain rights and obligations of the parties thereto
relating to their respective ownership interests in the Partnership;

WHEREAS, pursuant to the Amended and Restated Equity Purchase Agreement, dated
as of February 27, 2006 (the “Centre Purchase Agreement”), among Acquisition and
Centre Capital Investors III, L.P., Centre Capital Individual Investors III,
L.P., Centre Capital Partners Coinvestment III, L.P., Centre Capital Tax-Exempt
Investors III, L.P., Centre Capital Offshore Investors III, L.P. and Centre
Partners III, L.P. (collectively, the “Centre Entities”), (i) Acquisition has
purchased from the Centre Entities certain Partnership Units; and (ii) upon
consummation of the transactions contemplated by the Centre Purchase Agreement
and the Blocker Redemption Agreements (as defined below), the Centre Entities
have ceased to be holders of Securities of the Partnership;

WHEREAS, pursuant to that certain Tag-Along Sale Agreement, dated as of
February 27, 2006 (the “Tag-Along Sale Agreement”), among Acquisition and each
of the Securityholders party thereto, Acquisition has purchased from such
Securityholders certain Partnership Units;

WHEREAS, pursuant to that certain Unit Purchase Agreement, dated as of
February 8, 2006 (the “Unit Purchase Agreement”), among Coastal, Acquisition,
for purposes of Section 5.1(a) and Section 5.2 thereof only, certain of the
Centre Entities and, for purposes of Article V thereof only, Bodal, Coastal has
purchased from Acquisition certain Partnership Units;

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WHEREAS, pursuant to those certain Redemption Agreements, each dated as of
February 27, 2006 (the “Redemption Agreements”), among certain of the Centre
Entities and each of the Blocker Corporations, (i) each of the Blocker
Corporations has redeemed certain shares of common stock of the Blocker
Corporations (“Blocker Shares”) held by such Centre Entities, and (ii) the
Centre Entities have ceased to be holders of Blocker Shares;

WHEREAS, CP3 and the holders of Blocker Shares of CP3 have entered into an
amended and restated shareholders agreement, each dated as of the date hereof,
with respect to the Blocker Shares of CP3 (together, the “Blocker Shareholders
Agreement”), containing tag-along rights and other governance provisions
substantially analogous to those contained herein;

WHEREAS, the holders of membership interests in American Seafoods Holdings LLC,
a Delaware limited liability company formerly wholly-owned by the Partnership
(“AS Holdings”), have entered into an amended and restated limited liability
agreement of AS Holdings, dated as of the date hereof, which contains, with
respect to the common interests therein, tag-along rights and other governance
provisions substantially analogous to those contained herein;

WHEREAS, the parties hereto wish to amend and restate the Securityholders
Agreement in its entirety as of the date hereof, to take account of and provide
for the aforementioned events and to reflect the agreement of the parties as to
the subject matter thereof, to read as set forth in this Agreement.

NOW, THEREFORE, in consideration of the foregoing and for good and valuable
consideration, the parties hereby agree as follows:

ARTICLE I

DEFINITIONS

 

Section 1.1 Definitions. As used in this Agreement, the following terms have the
following meanings:

“Acquisition” shall have the meaning set forth in the preamble hereto.

“Acquisition LLC Members” means Bodal, certain other members of management of
the Partnership or its Affiliates and certain other Persons and entities set
forth on Schedule IV attached hereto who are members of Acquisition as of the
date hereof and any other Person who becomes a member of Acquisition after the
date hereof.

“Additional Management Securityholders” means any member of management to whom
Securities are issued after the date hereof.

“Additional Securities” means all Securities which are issued or sold by the
Partnership at any time, other than (i) any Securities issued to all of the
holders of Securities then outstanding on a proportionate basis, (ii) any
Securities issued to one or more employees of the Partnership pursuant to and in
accordance with any employee benefit plan, agreement or arrangement that has
been approved by the Board, (iii) any Securities that are issued in connection
with the acquisition by the Partnership or a subsidiary of the Partnership of
any business (whether by acquisition of stock or assets), provided that such
Securities are not issued for less than their Fair Market Value, (iv) any
Securities issued in amounts less than $1,000,000 in any single transaction or
related series of transactions, provided that the aggregate amount of all
transactions under this clause (iv) shall not exceed $3,000,000, (v) any
Securities issued to any Person providing debt or nonparticipating and
nonconvertible preferred equity financing to the Partnership or any subsidiary
of the Partnership in a bona fide financing transaction approved by the Board,
(vi) any Securities issued upon exercise, conversion or exchange of any other
Securities, (vii) any Securities issued to an Alaska Native Entity or (viii) any
securities issued to a Person whose participation in the Partnership the Board
determines, in good faith and with the concurrence of (x) at least two
Independent Directors, (y) at least one Coastal Affiliated Director and (z) at
least one Management Affiliated Director, based on factors particular to the
identity, nature or domicile of such Person, would be an asset or benefit to the
Business.

 

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“Additional Securityholders” shall have the meaning set forth in the preamble
hereto.

“Affiliate” means with respect to any Person, any Person directly or indirectly
controlling, controlled by, or under common control with such other Person. For
purposes of this definition, “control” when used with respect to any Person
means the power to direct the management and policies of such Person, directly
or indirectly, whether through the ownership of voting securities, by contract
or otherwise, and the terms “controlling” and “controlled” have meanings
correlative to the foregoing.

“Affiliated Directors” means, collectively, the Coastal Affiliated Directors and
the Management Affiliated Directors.

“Agreement” means this Second Amended and Restated Securityholders Agreement, as
it may be amended from time to time.

“Alaska Native Entity” means any corporation, partnership or other entity
(i) the majority of the equity or other interests of or in which is owned by or
held for the benefit of Alaska natives or (ii) the primary purpose of which is
to benefit Alaska natives, including, without limitation, any Alaska native
corporation, whether a regional or a village corporation, and any entity that
receives allocations of community development quota under federal laws or
programs, as well as any Affiliate of any of the foregoing.

“American Fisheries Act” means the American Fisheries Act, Title II of Division
C of P.L. 105-277 (Oct. 21, 1998), or any successors or supplements thereto, as
amended from time to time.

“Applicable Federal Rate” means, with respect to any subordinated note of the
Partnership described in clause (i) of the definition of Redemption Securities,
the long-term “applicable federal rate”, compounded semi-annually, as released
by the Internal Revenue Service pursuant to its authority under Section 1274(d)
of the Code, for the month during which such subordinated note was issued.

“Applicable Tag Percentage” shall have the meaning set forth in Section 3.1(b).

“ASC Offshore” shall have the meaning set forth in the preamble hereto.

“ASG Consolidated” means ASG Consolidated LLC, a Delaware limited liability
company that is indirectly wholly-owned by Consolidated.

“AS Holdings” shall have the meaning set forth in the recitals hereto.

“Asset Buyer’s Notice” shall have the meaning set forth in Section 3.2(d).

 

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“Asset Offering Notice” shall have the meaning set forth in Section 3.2(d).

“Asset Offer Price” shall have the meaning set forth in Section 3.2(d).

“Blocker Corporations” shall have the meaning set forth in the preamble hereto.

“Blocker Shareholders Agreement” shall have the meaning set forth in the
recitals hereto.

“Blocker Shares” shall have the meaning set forth in the recitals hereto.

“Board” means (i) for so long as the Partnership is organized as a limited
partnership, the Board of Directors of the General Partner, which shall serve as
the governing body of the General Partner or (ii) otherwise, the board of
directors or other governing body of any successor entity to the Partnership.

“Board Committees” shall have the meaning set forth in Section 7.10.

“Bodal” means Mr. Bernt O. Bodal.

“Bodal Employment Agreement” means the Employment Agreement, dated as of
January 28, 2000, among the Partnership, Group and Bodal, as it may be from time
to time amended.

“Business” shall have the meaning set forth in Section 5.1(a).

“Business Day” means each day other than Saturdays, Sundays and days when
commercial banks are authorized to be closed for business in New York, New York.

“Buyer’s Notice” shall have the meaning set forth in Section 3.2(a).

“Cause” means (i) the commission by a member of the Board of a felony or any
other crime involving moral turpitude, fraud, misrepresentation, embezzlement or
theft (ii) engaging in any activity that is harmful (including, without
limitation, alcoholic or other self-induced affliction), in a material respect,
to the Partnership or any of its subsidiaries or Affiliates, monetarily or
otherwise, as determined by a majority of the Board; (iii) material malfeasance
(including without limitation, any intentional act of fraud or theft),
misconduct, or gross negligence in connection with the performance of a Person’s
duties as a member of the Board; (iv) a significant violation of any statutory
or common law duty of loyalty to the Partnership or any of its subsidiaries or
Affiliates; (v) a material breach of this Agreement or of any Partnership policy
(including without limitation, disclosure or misuse of any confidential or
competitively sensitive information or trade secrets of the Partnership or any
of its subsidiary or Affiliates); or (vi) refusal or failure to carry out
directives or instructions of the Board, in the case of clause (v) or
(vi) above, only if such breach or failure continues for more than ten (10) days
following written notice from the Partnership describing such breach or failure.

“Centre Entities” shall have the meaning set forth in the recitals hereto.

“Centre Purchase Agreement” shall have the meaning set forth in the recitals
hereto.

“Coastal” shall have the meaning set forth in the preamble hereto.

 

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“Coastal Affiliated Directors” means any members of the Board nominated by
Coastal pursuant to Section 7.1 (or by any Transferee of Coastal’s right to
nominate members of the Board pursuant to Section 7.1(d)) who are not required
to be Independent Directors.

“Coastal Independent Director” shall have the meaning set forth in
Section 7.1(a).

“Commission” means the U.S. Securities and Exchange Commission.

“Competitor” means any Person with an interest, whether as an owner, principal,
director, independent contractor or employee, in any business, entity or venture
that competes directly with the Business in the United States, or that is a
member of a fishery cooperative of or in which the Partnership or any of its
subsidiaries is a member. An interest solely in publicly traded securities
constituting less than 5% of the issuer shall not, alone, cause a Person to be a
Competitor.

“Consolidated” means American Seafoods Consolidated LLC, a Delaware limited
liability company that is wholly-owned by AS Holdings.

“CP3” shall have the meaning set forth in the preamble hereto.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

“Exercise Period” shall have the meaning set forth in Section 3.2(a).

“Fair Market Value” means, with respect to any Securities, the fair market value
thereof as determined in good faith by the Board.

“Foreign Ownership Percentage” means, at any date with respect to any Person,
the percentage of the interest in such Person, at each tier of ownership of such
Person and in the aggregate, that is owned and controlled (determined in
accordance with the standards of section 12102(c)(1) and (2) of title 46 of the
United States Code (as amended by the American Fisheries Act) and any
regulations thereunder or relevant thereto, all as effective on or after
October 1, 2001 (whether the date of determination is before or after such
date), or as determined under any analogous provisions of any successor statutes
or regulations) by Foreign Persons.

“Foreign Person” means at any date a Person that would not be eligible to own a
vessel with a fisheries endorsement under the standards of subsections 12102(a)
and 12102(c)(1) and (2) of title 46 of the United States Code (as amended by the
American Fisheries Act) and any regulations thereunder or relevant thereto, all
as effective on or after October 1, 2001 (whether the date of determination is
before or after such date), or under any analogous provisions of any successor
statutes or regulations. In determining whether any Person is a Foreign Person,
effect shall be given to Marad’s methodology and determinations in any
determination letter provided by it to the Partnership or its Affiliates.

“General Partner” shall have the meaning set forth in the preamble hereto.

“Group” shall mean American Seafoods Group LLC, a Delaware limited liability
company.

“Independent Director” means, with respect to the Board, a director who (x) a
majority of the Independent Directors (or if there are no Independent Directors
serving on the Board at the time of determination, a majority of the Board)
determines has no material relationship with the Partnership, Acquisition or
Coastal and has had no prior relationship with the Partnership, Acquisition or
Coastal that might reasonably be expected to cause such director to act other
than entirely independently with respect to all issues that come before the
Board; and (y) satisfies the independence requirements under Rule 303A.02 of the
Listed Company Manual of the New York Stock Exchange with respect to the
Partnership, Coastal and Acquisition; provided that no Independent Director
shall be permitted to participate in a vote to determine whether his or her
replacement director satisfies the independence requirements set forth in
(x) and (y) hereof unless there are no other Independent Directors serving on
the Board at the relevant time. Although not a requirement for service, the
parties entitled under this Agreement to nominate Independent Directors to serve
on the Board will seek to nominate candidates that have demonstrated significant
leadership experience such as public company board service, significant private
entity board service, public or community service or similar experience.

 

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“Initial Directors” shall have the meaning set forth in Section 7.6(a).

“Initial Independent Directors” shall have the meaning set forth in
Section 7.8(a).

“Initial Management Securityholders” shall have the meaning set forth in the
preamble hereto.

“ISB” means Islandsbanki hf, a credit institution organized and existing under
the laws of Iceland.

“LLC Units” means the limited liability company units of Acquisition.

“Management Affiliated Directors” means any members of the Board nominated by
the Management Securityholders or Bodal pursuant to Section 7.3 or Section 7.4
(or by any Transferee of the Management Securityholders’ or Bodal’s right to
nominate members of the Board pursuant to Section 7.3(c) or Section 7.4(c)) who
are not Independent Directors.

“Management Options” means options to purchase Partnership Units or other
Securities issued to the Management Securityholders.

“Management Securityholders” shall have the meaning set forth in the preamble
hereto.

“Marad” means The United States Maritime Administration or any successor entity.

“Offer Price” shall have the meaning set forth in Section 3.1(a).

“Offered Assets” shall have the meaning set forth in Section 3.2(d)

“Offered Blocker Shares” shall have the meaning set forth in Section 3.2(c).

“Offered LLC Units” shall have the meaning set forth in Section 3.2(b).

“Offering Blocker Holder” shall have the meaning set forth in Section 3.2(c).

“Offering Member” shall have the meaning set forth in Section 3.2(b).

“Offered Securities” shall have the meaning set forth in Section 3.2(a).

“Offering Notice” shall have the meaning set forth in Section 3.2(a).

 

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“Offeror” shall have the meaning set forth in Section 3.2(a).

“Partnership” shall have the meaning set forth in the preamble hereto.

“Partnership Agreement” shall have the meaning set forth in the recitals hereto.

“Partnership Units” means units of limited partnership in the Partnership.

“Permitted Transferee” means, (i) with respect to any Securityholder,
Acquisition LLC Member or holder of Blocker Shares that is an individual (an
“Individual Holder”), such Individual Holder’s spouse, children, parents or
grandchildren or any trust or partnership established solely for the benefit of
the Individual Holder or the foregoing relatives of such Individual Holder,
(ii) in the case of a Securityholder, Acquisition LLC Member or holder of
Blocker Shares that is a corporation, partnership or other entity (a “Corporate
Holder”), any Affiliate of such Corporate Holder, and (iii) in the case of a
Securityholder, Acquisition LLC Member or holder of Blocker Shares that is an
Alaska Native Entity, any Alaska Native Entity, but only if such transferee
Alaska Native Entity does not hold an interest in any Person, vessel, processing
facility or other assets that could cause a limitation or restriction on the
quantity of fish or shellfish which may be harvested or processed by the
Partnership or its Subsidiaries under the American Fisheries Act or any
regulations thereunder or relevant thereto.

“Person” means any individual, general partnership, limited partnership
corporation, limited liability company, joint venture, trust, business trust,
cooperative or association.

“Preemptive Rights Parties” shall have the meaning set forth in Section 4.1(a).

“PublicCo” shall have the meaning set forth in Section 5.1(a).

“Public Liquidity Event” shall have the meaning set forth in Section 5.1(a).

“Public Transfer” means a Transfer in a public offering pursuant to an effective
registration or a Transfer in a bona fide market transaction effected on a
public securities exchange, NASDAQ or a comparable market system.

“Qualified Public Offering” means a public offering of the common stock of
PublicCo pursuant to an effective registration statement under the Securities
Act (other than a registration statement on Form S-8 or otherwise relating to
equity securities issuable under any employee benefit plan of the Partnership)
following which an amount of such common stock constituting at least 20% of the
common equity of PublicCo and the Partnership is traded on the New York Stock
Exchange, the American Stock Exchange or the National Association of Securities
Dealers Automated Quotation System.

“Redemption Agreements” shall have the meaning set forth in the recitals hereto.

“Redemption Securities” means (i) subordinated notes of the Partnership with a
term of 10 years, bearing interest at 4.99 percentage points above the
Applicable Federal Rate (which interest shall, at the option of the Partnership,
be added to principal on each interest payment date), containing no covenants or
other rights to control the Partnership and containing such other terms not
inconsistent with the foregoing as the General Partner shall deem appropriate
and (ii) if deemed appropriate by the General Partner and if there shall have
been a determination by Marad that they would not affect the Partnership’s
Foreign Ownership Percentage, warrants for 25% of the number of Partnership
Units redeemed in the pertinent redemption at an exercise price equal to the
Fair Market Value of 25% of the number of Partnership Units redeemed in the
pertinent redemption.

 

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“Registration Statement” means any registration statement, including any
amendments and supplements thereto, filed with the Commission in connection with
any Public Liquidity Event.

“Remedial Conversion Holder” means, at any time, any Securityholder other than a
member of the management of the Business that, at such time, cannot establish
that it is not a Foreign Person.

“Response Notice” shall have the meaning set forth in Section 5.3.

“Right of First Offer” shall have the meaning set forth in Section 3.2(a).

“Safe Harbor Percentage” means 88% of the Foreign Ownership Percentage that, if
exceeded by the Partnership, would cause the Partnership to be a Foreign Person.

“Securities” means (i) the Partnership Units, any other equity interests in the
Partnership that may be issued by the Partnership, the Management Options, any
warrants, options or other rights that may be issued by the Partnership to
purchase Partnership Units or such other equity interests in the Partnership and
(ii) following the creation of PublicCo, any common stock or other equity
interests in PublicCo. Whenever any determination is required hereunder as to
any percentage of any Securities or as to the proportionate interest or rights
of any Securities, the following principals shall apply unless the context
clearly requires otherwise: (i) if such determination is to be made to measure
the Foreign Ownership Percentage or whether any entity is a Foreign Person, such
determination shall be made as contemplated by the definitions thereof; (ii) if
clause (i) does not apply and if such determination relates to Management
Options or like Securities, such determination shall in the first instance be
made on a fully diluted, as-converted or as-exercised basis (it being understood
that nothing herein shall relieve the holder of its obligation to pay the
pertinent exercise or strike price); and (iii) if clause (i) does not apply
(and, in the case of Securities described in clause (ii), following such
as-converted or as exercised determination), any such determination shall be
made on the basis of rights to share in distributions on liquidation of the
Partnership following a sale of all of its assets for fair market value.

“Securities Act” means the Securities Act of 1933, as amended.

“Securityholder” shall have the meaning set forth in the preamble hereto.

“Securityholders Agreement” shall have the meaning set forth in the recitals
hereto.

“Senior Officer” means, with respect to any entity, such entity’s chief
executive officer, president, any vice president in charge of a principal
business unit, division or function (such as sales, administration or finance),
any other officer who performs a policy making function or any other Person who
performs similar policy making functions.

“Special Committee” shall have the meaning set forth in Section 7.8(e).

“Spousal Consent” shall have the meaning set forth in Section 8.5.

“Subsequent Additional Securityholder” means any Person to whom Securities are
issued after the date hereof and who is not a Management Securityholder.

“Swap Transaction” means, with respect to any Securities, any swap,
participation or other arrangement that transfers to another Person, in whole or
in part, any significant economic consequences of ownership thereof.

 

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“Tag-Along Right” shall have the meaning set forth in Section 3.1(a).

“Tag-Along Sale” shall have the meaning set forth in Section 3.1(a).

“Tag-Along Sale Agreement” shall have the meaning set forth in the recitals
hereto.

“Tag-Along Seller” shall have the meaning set forth in Section 3.1(a)

“Transfer” means, with respect to any Securities, LLC Units or Blocker Shares,
any direct or indirect transfer, sale, assignment, redemption or other
disposition of ownership thereof.

“Transferee” means any transferee of Securities or any interest therein.

“Transfer Notice” shall have the meaning set forth in Section 3.1(a).

“Vested Options” means all vested Management Options and, to the extent
determined in connection with a proposed Transfer, Management Options that will
become vested upon the consummation of the proposed Transfer.

“Underlying Partnership Units” shall have the meaning set forth in
Section 3.2(b).

“Unit Purchase Agreement” shall have the meaning set forth in the recitals
hereto.

ARTICLE II

RESTRICTIONS ON TRANSFER

Section 2.1 In General.

(a) No Securityholder shall pledge, hypothecate or otherwise encumber or
Transfer any Securities, or enter into any Swap Transaction with respect to any
Securities, except in compliance with the Securities Act, applicable state
securities laws and all applicable provisions of this Agreement. Any attempt to
pledge, hypothecate or otherwise encumber or Transfer any Securities or enter
into any Swap Transaction with respect to any Securities not in compliance with
all applicable provisions of this Agreement shall be null and void and the
Partnership shall not register upon its books any such attempted pledge,
hypothecation or other encumbrance or Transfer of Securities.

(b) Each Securityholder agrees that it will not pledge, hypothecate or otherwise
encumber or Transfer any Securities (including any Transfer to a Permitted
Transferee) or enter into any Swap Transaction with respect to any Securities
prior to delivery to the Partnership of evidence in form and substance
reasonably satisfactory to the Partnership to the effect that such pledge,
hypothecation, encumbrance, Transfer, or Swap Transaction will (i) be in
compliance with the Securities Act and applicable state securities laws,
(ii) not result in the Partnership being treated as a “publicly traded
partnership” within the meaning of the Internal Revenue Code of 1986, as
amended, (iii) not cause a termination of the Partnership for Federal income tax
purposes, and (iv) not result in an increase in the Foreign Ownership Percentage
of the Partnership.

(c) A copy of this Agreement shall be filed with the Partnership and kept with
the records of the Partnership. Each of the Securityholders hereby agrees that
if at any time certificates representing any Securities are issued to any
Securityholder, such certificates, and any certificates for any Securities
issued in exchange for any similarly legended certificates, such certificates
shall bear a legend reading substantially as follows:

 

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THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY BE OFFERED AND SOLD ONLY IF SO
REGISTERED OR IN A MANNER EXEMPT FROM REGISTRATION UNDER SUCH ACT. THE
SECURITIES REPRESENTED BY THIS CERTIFICATE ALSO ARE SUBJECT TO ADDITIONAL
RESTRICTIONS ON TRANSFER AS SET FORTH IN THE SECOND AMENDED AND RESTATED
SECURITYHOLDERS AGREEMENT OF AMERICAN SEAFOODS, L.P. (THE “PARTNERSHIP”), DATED
AS OF FEBRUARY 27, 2006, COPIES OF WHICH MAY BE OBTAINED FROM THE PARTNERSHIP.
NO TRANSFER OF THESE SECURITIES WILL BE MADE ON THE BOOKS OF THE PARTNERSHIP
UNLESS ACCOMPANIED BY EVIDENCE OF COMPLIANCE WITH THE TERMS OF SUCH AGREEMENT.

The foregoing legend shall be in addition to any other legend required to be
placed on any certificates for any Securities under applicable law. Subject to
(g), no Transfer of any Securities shall be effective unless the certificates
(if any) representing the Securities issued to the Transferee bear the legend
set forth in this Section.

(d) The Securityholder making a pledge, hypothecation, encumbrance or Transfer
or entering into a Swap Transaction permitted hereunder shall be required to pay
any and all filing and recording fees, fees of counsel and accountants, and
other costs and expenses reasonably incurred by the Partnership as a result of
such pledge, hypothecation, encumbrance or Transfer or such Swap Transaction.

(e) No pledge, hypothecation, encumbrance, Transfer or Swap Transaction by a
Securityholder permitted hereunder shall relieve the transferor Securityholder
of any of its obligations or liabilities under this Agreement arising prior to
or in connection with the consummation of such pledge, hypothecation,
encumbrance or Transfer or Swap Transaction.

(f) In connection with each pledge, hypothecation, encumbrance, Transfer or Swap
Transaction permitted hereunder, the Securityholder making the pledge,
hypothecation, encumbrance or Transfer or entering into a Swap Transaction and
the Transferee shall deliver to the Partnership such other documents and
instruments as the Partnership reasonably may request to confirm that such
pledge, hypothecation, encumbrance, Transfer or Swap Transaction is in
compliance with the terms and conditions of this Agreement.

(g) If Transfers of any Securities may be made to the public without
registration under the Securities Act, the Partnership shall, upon the written
request of a Securityholder, issue to such Securityholder a new certificate
evidencing such Securities, which certificate shall bear a legend that does not
contain the first sentence of the legend set forth in Section 2.1(c); provided
that such holder shall furnish the Partnership or its transfer agent such
certificates, legal opinions or other information as the Partnership or its
transfer agent may reasonably require to confirm that such sentence is not
required on such certificate. If any Securities shall cease to be entitled to
any rights and subject to any obligations set forth in this Agreement, the
Partnership shall, upon the written request of the holder thereof, issue to such
holder a new certificate evidencing such Securities without the second sentence
of the foregoing legend.

 

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Section 2.2 Additional Restrictions.

(a) No Blocker Corporation, Additional Securityholder or Management
Securityholder may pledge, hypothecate, encumber, Transfer or enter into a Swap
Transaction with respect to any interest in Securities without the prior written
approval of the Partnership, which approval shall not be unreasonably withheld
or delayed; provided, however, that such approval shall not be required in the
case of (i) a Transfer to a Permitted Transferee, (ii) a pledge or Transfer to
the Partnership, (iii) a Transfer pursuant to and in conformity with Section 3.1
or Section 3.2, (iv) a Public Transfer, (v) a pledge by a Management
Securityholder to a lender approved by the Partnership for the purpose of
securing a loan utilized by such Securityholder to fund a portion of his or her
capital contribution to the Partnership or (vi) a pledge by an Additional
Securityholder to a financial institution to secure a loan, provided that such
lender enters into an agreement in form and substance reasonably satisfactory to
the Partnership acknowledging that the subsequent pledge, hypothecation,
encumbrance or Transfer of or a Swap Transaction with respect to Securities by,
to or at the instigation of such lender shall be subject to all of the
applicable provisions of this Agreement, including those contained in this
Article II and Section 8.4.

(b) The Management Securityholders shall not pledge, hypothecate, encumber,
Transfer, or enter into a Swap Transaction with respect to any Management
Options that are not Vested Options.

ARTICLE III

ADDITIONAL RIGHTS AND OBLIGATIONS

OF SECURITYHOLDERS AND THE PARTNERSHIP

Section 3.1 Rights of Inclusion.

(a) If Acquisition, Coastal or Bodal (in each case, a “Tag-Along Seller”)
proposes to Transfer, directly or indirectly, in any one transaction or a series
or related transactions, to any Person or Persons (other than any Transfer
(i) to a Permitted Transferee, (ii) in a Public Transfer or (iii) in connection
with the exercise by ISB, or any trustee thereof, of any remedies available to
it with respect to any Partnership Units pledged with ISB, or any trustee
thereof, by (x) Acquisition, (y) any Acquisition LLC Member or (z) the General
Partner (subject to the consent rights with respect to such Transfer granted to
the Limited Partners (as defined in the Partnership Agreement) under the
Partnership Agreement) as collateral pursuant to any credit agreement or any
related security agreement or other similar agreement) Securities representing
at least 10% of the aggregate number of Securities then outstanding (a
“Tag-Along Sale”), the Tag-Along Seller shall provide written notice of such
proposed Transfer to each Securityholder (the “Transfer Notice”) (it being
understood that any Transfers by any Tag-Along Seller that occur within 90 days
of one another shall be deemed to be related for these purposes). Such notice
shall identify the purchaser, the number of Securities proposed to be sold, the
consideration offered and any other material terms and conditions of the
proposed Transfer. If the offer price consists in part or in whole of
consideration other than cash, the Tag-Along Seller shall provide such
information, to the extent reasonably available to them, relating to such
consideration as each of the Securityholders may reasonably request in order to
evaluate such non-cash consideration. Each of the Additional Securityholders and
Management Securityholders shall have the right (the “Tag-Along Right”),
exercisable as set forth below, to sell, pursuant to the proposed Transfer, the
Applicable Tag Percentage (as defined below) of its Securities (provided that no
Management Options other than Vested Options may be sold hereunder) on the same
terms and conditions as apply to the Transfer by the Tag-Along Seller, and shall
execute and deliver all documents and instruments that are necessary or
desirable to effectuate such sale; provided that the Vested Options shall be
Transferred on the same terms as the Securities to be Transferred, subject to a
deduction of the exercise price with respect to the number of Securities for
which each Vested Option is exercisable (it being understood that if the
exercise price of such Vested Options is greater than the sale price, then such
Vested Options may not be Transferred). “Applicable Tag Percentage” means, in
connection with any Transfer by any Tag-Along Seller, the percentage of the
total number of Securities then held by such Tag-Along Seller to be sold
pursuant to such Transfer after giving effect to the exercise of the Tag-Along
Right by each of the Additional Securityholders and Management Securityholders
exercising such right. For the purpose of calculating the number of Securities
that any Management Securityholder or any Additional Securityholder is entitled
to sell under this Section 3.1(a), (A) any Vested Options held by such
Management Securityholder shall be deemed exercised and treated as the number of
Securities into which they are then exercisable and (B) any Partnership Units
beneficially owned by such Management Securityholder or Additional
Securityholder by virtue of his or her ownership of LLC Units shall be included
into such calculation. Each Tag-Along Right shall be exercisable by delivering
written notice to the Tag-Along Seller within 20 days after receipt of the
Transfer Notice. Promptly upon the expiration of such 20-day period, the
Tag-Along Seller shall notify each of the Additional Securityholders and
Management Securityholders exercising a Tag-Along Right of its Applicable Tag
Percentage. The Tag-Along Seller shall have 180 days from the expiration of such
20-day period to consummate the proposed Transfer at a price no greater than the
price set forth in the Transfer Notice (provided that each of the Additional
Securityholders and Management Securityholders who exercised a Tag-Along Right
in accordance with this Section 3.1(a) shall have the right to sell at the price
set forth in the Transfer Notice unless otherwise agreed by such Person) and on
terms and conditions no more favorable to the Tag-Along Seller than those stated
in the Transfer Notice. Any Securities that continue to be held by the Tag-Along
Seller after such Transfer shall continue to be subject to the provisions of
this Section 3.1(a).

 

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(b) The rights and obligations of the Securityholders in connection with a
Tag-Along Sale are subject to the following additional conditions:

(i) Upon the consummation of any Tag-Along Sale, all of the Securityholders
participating therein shall receive the same form and amount of consideration
per Partnership Unit (or, if the Securities sold are not Partnership Units, the
implied consideration per Partnership Unit, determined as of such time based on
the price paid and the terms and conditions of such Securities), or if
Securityholders are given an option as to the form and amount of consideration
to be received, all Securityholders participating therein must be given the same
option; provided that the Tag-Along Seller may, if the Tag-Along Seller so
chooses, receive less favorable terms.

(ii) All reasonable expenses incurred by the selling Securityholders in
connection with any Tag-Along Sale shall be borne ratably by such
Securityholders.

(iii) Each Securityholder participating in a Tag-Along Sale shall make
representations and warranties as to its title to the Securities being sold and
its power, authority, and right to enter into the pertinent transaction without
contravention of law or contract. In addition, such Securityholder shall join
with the Tag-Along Seller in making such representations and warranties
concerning the Partnership and the business as the Tag-Along Seller shall deem
necessary or appropriate; provided, however, that any liability for any breach
thereof shall be borne by each Securityholder on a pro rata basis based upon the
amount of Securities owned by such Securityholder and included in such Tag-Along
Sale.

(iv) Notwithstanding anything in this Agreement to the contrary, no
Securityholder will have the right to participate in a Tag-Along Sale without
the consent of the Partnership if and to the extent that (x) following such
Tag-Along Sale the Foreign Ownership Percentage of the Partnership would exceed
the Safe Harbor Percentage and (y) the failure of such Securityholder to so
participate would cause the Foreign Ownership Percentage of the Partnership
following such Tag-Along Sale to be lower.

 

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Section 3.2 Right of First Offer.

(a) If any Securityholder proposes to Transfer, directly or indirectly (other
than in any Transfer described in Section 3.2(b) hereof), all or any portion of
its Securities, other than to a Permitted Transferee or in a Public Transfer
(any such Securityholder desiring to make any such Transfer is referred to
herein as an “Offeror,” and the Securities that the Offeror seeks to Transfer
are referred to herein as the “Offered Securities”), then the Offeror shall
comply with the provisions of this Section 3.2(a), as follows:

(i) The Offeror shall give written notice (the “Offering Notice”) to the
Partnership and Coastal (unless the Offeror is Coastal), which Offering Notice
shall (A) state that the Offeror desires to Transfer such Offered Securities and
(B) specify the minimum sale price (the “Offer Price”) for such Securities and
the other material terms and conditions of such proposed Transfer. Each Offering
Notice shall constitute an irrevocable offer by the Offeror to the Partnership
or Coastal to Transfer the Offered Securities at the Offer Price in cash,
subject to the provisions of this Section 3.2(a).

(ii) The Partnership and Coastal shall have the right (the “Right of First
Offer”) to purchase all, but not less than all, of the Offered Securities at the
Offer Price in cash exercisable by delivery, within 45 days of receipt of an
Offering Notice (the “Exercise Period”), to the Offeror of a notice (a “Buyer’s
Notice”) stating (A) that the Partnership or Coastal, as the case may be, elects
to purchase all of the Offered Securities and (B) that such election is
irrevocable. Delivery of a Buyer’s Notice shall constitute a contract between
the Offeror and the Partnership or Coastal, as the case may be, for the sale and
purchase of the Offered Securities at the Offer Price in cash and upon the other
applicable terms and conditions set forth in the Offer Notice. Failure of the
Partnership or Coastal to exercise their Right of First Offer within the
Exercise Period shall be deemed to constitute a waiver of such right.

(iii) If neither the Partnership nor Coastal elects to purchase all of the
Offered Securities within the Exercise Period, the Offeror may, within 90 days
of the expiration of the Exercise Period, Transfer (or enter into an agreement
to Transfer and thereafter Transfer) all, but not less than all, of the Offered
Securities, to one or more Persons, at a price not lower than the Offer Price
and on terms in all material respects not more favorable to the purchaser than
those contained in the Offering Notice.

(iv) The closing of any purchase of the Offered Securities by the Partnership or
Coastal, as the case may be, shall be held in Seattle at a location to be
designated by the Partnership or Coastal, as the case may be, at 11:00 a.m.
local time on a Business Day chosen by the Partnership or Coastal, as the case
may be (upon at least five days notice to the other parties to the transaction),
which date shall be no later than the scheduled closing date provided for in the
Offering Notice; provided that such closing may be held at such other time and
place as the parties to the transaction may agree. At such closing the Offeror
shall deliver such instruments, executed by it and in form and substance
reasonably satisfactory to the Partnership or Coastal, as the case may be, as
shall be necessary to Transfer, assign and convey the Offered Securities to the
Partnership or Coastal, as the case may be, which shall be Transferred free and
clear of all liens or other encumbrances, against payment of the purchase price
therefor.

 

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(v) The Partnership shall have the first right to exercise the Right of First
Offer granted to the Partnership and Coastal hereunder. In the event that the
Partnership fails to exercise the Right of First Offer within 25 days of receipt
of an Offering Notice, Coastal may exercise the Right of First Offer within the
remainder of the Exercise Period. In the event that Coastal exercises such
right, Coastal may designate any of its Affiliates or Permitted Transferees or
any Alaska Native Entity as the purchaser of all or part of the Offered
Securities in any transaction hereunder.

(b) If any Acquisition LLC Member proposes to Transfer, directly or indirectly,
in one transaction or a series of related transactions, all or any portion of
its LLC Units representing in the aggregate the beneficial ownership of more
than 10,000 Partnership Units (any such Acquisition LLC Member desiring to make
any such Transfer of LLC Units is referred to herein as an “Offering Member” and
the LLC Units that the Offering Member seeks to Transfer are referred to herein
as the “Offered LLC Units”), other than to a Permitted Transferee or in a Public
Transfer, then Acquisition and the Offering Member shall comply with the
provisions of this Section 3.2(b), as follows:

(i) The Offering Member shall give an Offering Notice to each of the
Partnership, Coastal and Acquisition, which Offering Notice shall (A) state that
the Offering Member desires to Transfer the Offered LLC Units, (B) specify the
number of Partnership Units the beneficial ownership of which is represented by
the Offered LLC Units (the “Underlying Partnership Units”), (C) specify the
Offer Price for the Offered LLC Units and the other material terms and
conditions of such proposed Transfer, which shall constitute an irrevocable
offer by the Offering Member to the Partnership and Coastal to Transfer the
Offered LLC Units at the Offer Price in cash, subject to the provisions of this
Section 3.2(b).

(ii) The Partnership and Coastal shall have a Right of First Offer to purchase
all, but not less than all, of the Offered LLC Units or the Underlying
Partnership Units, at the Offer Price in cash exercisable by delivery, within
the Exercise Period, to the Offering Member of a Buyer’s Notice stating (A) that
the Partnership or Coastal, as the case may be, elects to purchase all of the
Offered LLC Units or the Underlying Partnership Units and (B) that such election
is irrevocable. Delivery of a Buyer’s Notice shall constitute a contract between
the Offering Member and the Partnership or Coastal, as the case may be, for the
sale and purchase of the Offered LLC Units or the Underlying Partnership Units,
at the Offer Price in cash and upon the other applicable terms and conditions
set forth in the Offer Notice. Failure of the Partnership or Coastal to exercise
their Right of First Offer within the Exercise Period shall be deemed to
constitute as a waiver of such right.

(iii) If neither the Partnership nor Coastal elects to purchase all of the
Offered LLC Units or the Underlying Partnership Units within the Exercise
Period, the Offering Member may, within 90 days of the expiration of Exercise
Period, Transfer (or enter into an agreement to Transfer and thereafter
Transfer) all, but not less than all, of the Offered LLC Units to one or more
Persons at a price not lower than the Offer Price and on terms in all material
respects not more favorable to the purchaser than those contained in the
Offering Notice.

(iv) The closing of any purchase of the Offered LLC Units or the Underlying
Partnership Units shall be held in Seattle at a location to be designated by the
Partnership or Coastal, as the case may be, at 11:00 a.m. local time on a
Business Day chosen by the Partnership or Coastal, as the case may be (upon at
least five days notice to the other parties to the transaction), which date
shall be not later than the scheduled closing date provided for in the Offering
Notice; provided that such closing may be held at such other time and place as
the parties to the transaction may agree. Acquisition shall use its reasonable
best efforts to cause the Underlying Partnership Units to be distributed to the
Offering Member immediately prior to the closing. At the closing, the Offering
Member shall deliver such instruments, executed by it and in form and substance
reasonably satisfactory to the Partnership or Coastal, as the case may be, as
shall be necessary to Transfer, assign and convey the Underlying Partnership
Units to the Partnership or Coastal, as the case may be, which shall be
Transferred free and clear of all liens or other encumbrances, against payment
of the purchase price therefor (which purchase price shall be equal to the
aggregate Offer Price payable for the Offered LLC Units). If for any reason
Acquisition is unable to cause the Underlying Partnership Units to be
distributed to the Offering Member pursuant to this clause (iv) of this
Section 3.2(b), then at the closing, the Offering Member shall deliver such
instruments, executed by it and in form and substance reasonably satisfactory to
the Partnership or Coastal, as the case may be, as shall be necessary to
Transfer, assign and convey the Offered LLC Units to the Partnership or Coastal,
as the case may be, which shall be Transferred free and clear of all liens or
other encumbrances, against payment of the purchase price therefor.

 

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(v) The Partnership shall have the first right to exercise the Right of First
Offer granted to the Partnership and Coastal under this Section 3.2(b). In the
event that the Partnership fails to exercise the Right of First Offer within the
first 25 days of receipt of an Offering Notice, then Coastal may exercise the
Right of First Offer within the remainder of the Exercise Period. In the event
that Coastal exercises such right, Coastal may designate any of its Affiliates
or Permitted Transferees or any Alaska Native Entity as the purchaser of all or
part of the Underlying Partnership Units or the Offered LLC Units, as
applicable, in any transaction hereunder.

(c) If any holder of Blocker Shares proposes to Transfer, directly or
indirectly, in one transaction or a series of related transactions, all or any
portion of its Blocker Shares representing in the aggregate (together with any
Transfer, in one transaction or a series of related transactions, of all or any
portion of such holder’s Securities or LLC Units) the beneficial ownership of
more than 10,000 Partnership Units (any such holder of Blocker Shares desiring
to make any such Transfer of Blocker Shares is referred to herein as an
“Offering Blocker Holder” and the Blocker Shares that the Offering Blocker
Holder seeks to Transfer are referred to herein as the “Offered Blocker
Shares”), other than to a Permitted Transferee or in a Public Transfer, then the
Blocker Corporations and the Offering Blocker Holder shall comply with the
provisions of this Section 3.2(c), as follows:

(i) The Offering Blocker Holder shall give an Offering Notice to the
Partnership, Coastal and the Blocker Corporation the shares of which constitute
the Offered Blocker Shares, which Offering Notice shall (A) state that the
Offering Blocker Holder desires to Transfer the Offered Blocker Shares,
(B) specify the number of Partnership Units the beneficial ownership of which is
represented by the Offered Blocker Shares, (C) specify the Offer Price for the
Offered Blocker Shares and the other material terms and conditions of such
proposed Transfer, which Offering Notice shall constitute an irrevocable offer
by the Offering Blocker Holder to the Partnership and Coastal to Transfer the
Offered Blocker Shares at the Offer Price in cash, subject to the provisions of
this Section 3.2(c).

(ii) The Partnership and Coastal shall have a Right of First Offer to purchase
all, but not less than all, of the Offered Blocker Shares, at the Offer Price in
cash exercisable by delivery, within the Exercise Period, to the Offering
Blocker Holder of a Buyer’s Notice stating (A) that the Partnership or Coastal,
as the case may be, elects to purchase all of the Offered Blocker Shares and
(B) that such election is irrevocable. Delivery of a Buyer’s Notice shall
constitute a contract between the Offering Blocker Holder and the Partnership or
Coastal, as the case may be, for the sale and purchase of the Offered Blocker
Shares, at the Offer Price in cash and upon the other applicable terms and
conditions set forth in the Offer Notice. Failure of the Partnership or Coastal
to exercise their Right of First Offer within the Exercise Period shall be
deemed to constitute as a waiver of such right.

 

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(iii) If neither the Partnership nor Coastal elects to purchase all of the
Offered Blocker Shares, as applicable, within the Exercise Period, the Offering
Blocker Holder may, within 90 days of the expiration of Exercise Period,
Transfer (or enter into an agreement to Transfer and thereafter Transfer) all,
but not less than all, of the Offered Blocker Shares to one or more Persons at a
price not lower than the Offer Price and on terms in all material respects not
more favorable to the purchaser than those contained in the Offering Notice.

(iv) The closing of any purchase of the Offered Blocker Shares shall be held in
Seattle at a location to be designated by the Partnership or Coastal, as the
case may be, at 11:00 a.m. local time on a Business Day chosen by the
Partnership or Coastal, as the case may be (upon at least five days notice to
the other parties to the transaction), which date shall be not later than the
scheduled closing date provided for in the Offering Notice; provided that such
closing may be held at such other time and place as the parties to the
transaction may agree. At such closing, the Offering Member shall deliver such
instruments, executed by it and in form and substance reasonably satisfactory to
the Partnership or Coastal, as the case may be, as shall be necessary to
Transfer, assign and convey the Offered Blocker Shares to the Partnership or
Coastal, as the case may be, which shall be Transferred free and clear of all
liens or other encumbrances, against payment of the purchase price therefor.

(v) The Partnership shall have the first right to exercise the Right of First
Offer granted to the Partnership and Coastal under this Section 3.2(c). In the
event that the Partnership fails to exercise the Right of First Offer within the
first 25 days of receipt of an Offering Notice, then Coastal may exercise the
Right of First Offer within the remainder of the Exercise Period. In the event
that Coastal exercises such right, Coastal may designate any of its Affiliates
or Permitted Transferees or any Alaska Native Entity as the purchaser of all or
part of the Blocker Partnership Units or the Offered Blocker Shares, as
applicable, in any transaction hereunder.

(d) If the Partnership proposes to sell or otherwise dispose of all or
substantially all of the Partnership assets (the “Offered Assets”), then the
Partnership shall comply with the provisions of this Section 3.2(d), as follows:

(i) The Partnership shall give a written notice (an “Asset Offering Notice”) to
Coastal, which Offering Notice shall (A) state that the Partnership desires to
sell or otherwise dispose of the Offered Assets and (B) the minimum sale price
(the “Asset Offer Price”) for the Offered Assets and the other material terms
and conditions of such proposed sale or other disposition. The Asset Offering
Notice shall constitute an irrevocable offer by the Partnership to Coastal to
sell the Offered Assets at the Asset Offer Price in cash, subject to the
provisions of this Section 3.2(d).

(ii) Coastal shall have a Right of First Offer to purchase all, but not less
than all, of the Offered Assets at the Asset Offer Price in cash exercisable by
delivery, within 45 days of receipt of an Asset Offering Notice, to the
Partnership of a written notice (a “Asset Buyer’s Notice”) stating (A) that
Coastal elects to purchase all of the Offered Assets and (B) that such election
is irrevocable. Delivery of an Asset Buyer’s Notice shall constitute a contract
between the Partnership and Coastal for the sale and purchase of the Offered
Assets at the Asset Offer Price in cash and upon the other applicable terms and
conditions set forth in the Asset Offering Notice. Failure of Coastal to
exercise its Right of First Offer within such 45-day period shall be regarded as
a waiver of such right.

 

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(iii) If Coastal elects not to purchase the Offered Assets within the 30-day
period specified in clause (ii) of this Section 3.2(d), the Partnership may,
within 90 days of the expiration of such 45-day period, sell or otherwise
dispose (or enter into an agreement to sell or otherwise dispose and thereafter
sell or dispose) of all, but not less than all, of the Offered Assets, to one or
more Persons at a price not lower than the Asset Offer Price and on terms in all
material respects not more favorable to the purchaser than those contained in
the Asset Offering Notice.

(iv) The closing of any sale of the Offered Assets by the Partnership to Coastal
shall be held in Seattle, at a place designated by Coastal, at 11:00 a.m. local
time on a Business Day chosen by it (upon at least five days notice to the other
parties to the transaction), which date shall be not later than the scheduled
closing date provided for in the Asset Offering Notice; provided that such
closing may be held at such other time and place as the parties to the
transaction may agree. At such closing, the Partnership shall deliver such
instruments, executed by it and in form and substance reasonably satisfactory to
Coastal, as shall be necessary to Transfer, assign and convey the Offered Assets
to Coastal on the terms and subject to the conditions set forth in the Asset
Offering Notice.

(v) In the event that Coastal exercises the Right of First Offer granted to it
under this Section 3.2(d), Coastal may designate any of its Permitted
Transferees or any Alaska Native Entity as the purchaser of all or part of the
Offered Assets in any transaction hereunder.

ARTICLE IV

ISSUANCE OF ADDITIONAL SECURITIES

Section 4.1 Rights Upon Issuance of Additional Securities.

(a) Subject to Section 4.6, the Partnership hereby grants to the Securityholders
(collectively, the “Preemptive Rights Parties”) the rights set forth in this
Article IV with respect to any and all proposed issuances or sales of Additional
Securities by the Partnership.

(b) Subject to Section 4.6, the parties agree that in the event of any issuance
or sale by AS Holdings of regular membership units of AS Holdings, (i) the
Preemptive Rights Parties shall have preemptive rights (the “Holdings Preemptive
Rights”) with respect to such issuance or sale that are substantially similar to
the rights of the Preemptive Rights Parties with respect to issuances or sales
of Additional Securities by the Partnership under this Article IV and (ii) the
Partnership shall cause AS Holdings to follow notice and other procedures for
the exercise of the Holdings Preemptive Rights that are substantially similar to
the notice and other procedures set forth in this Article IV for the exercise of
the rights of the Preemptive Rights Parties with respect to issuances or sales
of Additional Securities by the Partnership under this Article IV.

Section 4.2 Issuance Notice. The Partnership shall give the Preemptive Rights
Parties written notice of its intention to issue Additional Securities (the
“Issuance Notice”), describing the material terms of the Additional Securities,
the price at which the Additional Securities will be issued or sold, and the
material terms upon which the Additional Securities are proposed to be issued or
sold, including the anticipated date of such issuance or sale.

 

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Section 4.3 Response Notice. Each Preemptive Right Party shall have 20 days from
the date the Issuance Notice is received to agree to purchase all or any portion
of its Pro Rata Share (as defined below in Section 4.5) of such Additional
Securities by giving written notice to the Partnership of its desire to purchase
Additional Securities (the “Response Notice”) and stating therein the quantity
of Additional Securities to be purchased. Such Response Notice shall constitute
the irrevocable agreement of such Preemptive Rights Party to purchase the
quantity of Additional Securities indicated in the Response Notice at the price
and upon the terms and conditions stated in the Issuance Notice. Any purchase of
Additional Securities by any Preemptive Rights Party shall be consummated on the
closing date specified in the Issuance Notice (or, if other Persons are also
purchasing such Additional Securities, the date on which such Additional
Securities described in the applicable Issuance Notice are first issued and sold
to such other Persons). In the event that Additional Securities are being issued
or will be issuable as part of an investment unit with other securities of the
Partnership, the right of Preemptive Rights Parties to purchase such Additional
Securities shall be a right to purchase the entire investment unit and not a
right to purchase Additional Securities alone.

Section 4.4 Revised Issuance Notice. The Partnership shall have 90 days from the
date of the Issuance Notice to consummate the proposed issuance and sale of the
Additional Securities that are not being purchased by the Preemptive Rights
Parties at a price and upon terms and conditions that are not materially less
favorable to the Partnership than those specified in the Issuance Notice. If the
Partnership proposes to issue Additional Securities after such 90-day period or
at a price or upon terms that are materially less favorable to the Partnership
than those specified in the Issuance Notice, it must again comply with this
Article IV.

Section 4.5 Pro Rata Share. For purposes of this Article IV, the “Pro Rata
Share” of a Preemptive Rights Party shall be a fraction, (x) the numerator of
which shall be the total number of Partnership Units, Vested Options or other
Securities (but not unvested Management Options), as the case may be, then held
by the Preemptive Rights Party (whether directly or by virtue of ownership of
any LLC Units or Blocker Shares) and (y) the denominator of which shall be the
total number of Partnership Units, Vested Options or other Securities (but not
unvested Management Options) then issued and outstanding.

Section 4.6 Limitation on Foreign Ownership. No Foreign Person and no Person
more than 15% of the equity of which is owned by Foreign Persons shall have any
right to purchase Additional Securities pursuant to this Article IV if following
such proposed purchase the Foreign Ownership Percentage of the Partnership would
exceed the Safe Harbor Percentage.

 

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ARTICLE V

CREATION OF PUBLICLY TRADED ENTITY

Section 5.1 In General.

(a) Certain Alternatives. In the event the General Partner, after obtaining the
consent of the Securityholders as required by clause (iv) of Section 8.8(a),
determines that it would be in the best interests of the business conducted by
the Partnership and its subsidiaries (the “Business”) and the Securityholders
for the Business to have access to public capital markets and for the
Securityholders to have an opportunity to achieve liquidity through the sale of
equity to the public, the General Partner may determine to achieve such results
in such manner, and through whatever steps or structures, it deems appropriate.
Without limiting the foregoing, the General Partner may determine (i) to convert
the Partnership into a Delaware corporation, the shares of which will initially
be owned by the partners of the Partnership, and to take such corporation public
through one or more primary and/or secondary offerings; (ii) to convert AS
Holdings into a Delaware corporation, the shares of which could be either held
by the Partnership or distributed to the partners of the Partnership, and to
take such corporation public through one or more primary or secondary offerings;
or (iii) to create a newly incorporated Delaware corporation to serve as a
general partner of the Partnership or a managing member of AS Holdings, and to
take such corporation public through one or more primary (or, depending on the
precise structure, secondary) offerings, with the proceeds either being used by
the Business for whatever purposes it deems appropriate or being distributed to
those of the Securityholders who seek liquidity at the time (or, in the case of
a secondary offering, being retained by the selling Securityholder). Any such
event described in clauses (i), (ii) or (iii), or any variant or derivative of,
or, to the extent its results are similar, substitute for, the above is
hereinafter referred to as a “Public Liquidity Event”; and the Delaware
corporation the shares of which is taken public is hereinafter referred to as
“PublicCo”). The General Partner may also decide to pursue a Public Liquidity
Event for a portion of the Business, in which case the General Partner will take
such steps as are necessary to effectuate one of the structures described below
in a manner that provides liquidity with respect to the Securityholders’
proportionate interests in that portion of the Business.

(b) Determination. In determining the nature and structure of any Public
Liquidity Event to be undertaken, the General Partner shall take into account
relevant considerations under pertinent tax laws, securities laws (including the
Investment Company Act of 1940), and laws relating to the assets and activities
of the Business, including limitations on the Foreign Ownership Percentage, as
well as the advice of financial advisors and investment bankers. The General
Partner shall seek a structure and technique that treats similarly situated
Securityholders similarly and shall not discriminate among or between
Securityholders, or between it and its Affiliates and other Securityholders,
directly or indirectly, in providing access to public capital markets (it being
understood that nothing in this Section 5.1(b) shall prevent the General
Partner’s Affiliates or other parties hereto from exercising their registration
rights and selling or causing to be sold securities in accordance with the
priorities contained in Schedule III attached hereto). The General Partner shall
have no obligation of any nature whatsoever to choose any particular form of
Public Liquidity Event or to embark on a Public Liquidity Event at any time or
under any circumstances.

Section 5.2 Specific Alternatives.

(a) Conversion of the Partnership. In the event the General Partner determines
that a Public Liquidity Event should be effectuated by converting the
Partnership into a Delaware corporation, it shall take such steps as may be
necessary to effectuate such conversion in accordance with Delaware law, and
shall cause to be distributed to the parties therein shares of the common stock
of PublicCo in proportion to their rights to liquidating distributions under
Section 4.2 of the Partnership Agreement. Thereafter, the Securityholders and
PublicCo (which shall have become bound as the Partnership’s successor) shall
continue to be bound by the provisions of this Agreement (except to the extent
such provisions terminate in accordance with their terms (whether as a result of
a Qualified Public Offering or otherwise)) and the Securityholders shall have,
with respect to their shares of common stock of PublicCo, the registration
rights described and set forth in Schedule III attached hereto.

 

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(b) Conversion of AS Holdings. In the event the General Partner determines that
a Public Liquidity Event should be effectuated by converting AS Holdings into a
Delaware corporation, it shall take such steps as may be necessary to effectuate
such conversion in accordance with Delaware law and shall cause to be
distributed to the Partnership the shares of the common stock of PublicCo. In
the event the General Partner determines that such shares should be distributed
to the parties therein in accordance with Section 4.2 of the Partnership
Agreement, it shall take such steps as may be necessary to effectuate such
distribution, and, thereafter, PublicCo shall replace the Partnership as a party
to this Agreement and the Securityholders and PublicCo shall continue to be
bound by the provisions of this Agreement (except to the extent such provisions
terminate in accordance with their terms (either as a result of Qualified Public
Offering or otherwise)) and the Securityholders shall have, with respect to
their shares of common stock of PublicCo, the registration rights described and
set forth in Schedule III attached hereto. In the event the General Partner
determines that the Partnership should remain in existence and retain the shares
of common stock of PublicCo, the Securityholders and the Partnership shall
continue to be bound by the provisions of this Agreement (except to the extent
such provisions terminate in accordance with their terms (whether as a result of
a Qualified Public Offering or otherwise)) and the General Partner may cause to
occur one or more primary public offerings of PublicCo common stock or one or
more sales by the Partnership of its shares of PublicCo common stock. In either
event, any Securityholder shall be entitled to cause the Partnership to sell in
such public offering, indirectly for the account of such Securityholder, a
portion of the shares of PublicCo common stock owned by the Partnership and
allocable to such Securityholder (based on such Securityholder’s proportionate
rights to liquidating distributions under Section 4.2 of the Partnership
Agreement) equal to the number of such shares that such Securityholder would
have been able to sell in such public offering for its own account if it owned
such shares in PublicCo directly and exercised its registration rights described
and set forth in Schedule III attached hereto, subject to the terms thereof.
Upon such sale, the net proceeds thereof shall be distributed to such
Securityholder as a distribution in respect of or in redemption of such
Securityholder’s interest in the Partnership. It is possible that the General
Partner will determine that a combination of the two alternatives described in
this subsection (b) would be in the best interests of the parties, in which case
the rights of each Securityholder and obligations of the General Partner and its
Affiliates under this subsection (b) shall be appropriately modified so each
such party shall effectively realize or be subject to the same rights and
obligations as provided herein.

(c) New Public Company. In the event the General Partner determines that a
Public Liquidity Event should be effectuated by creating a newly incorporated
Delaware corporation to serve as a general partner of the Partnership or as the
managing member of AS Holdings, it shall take such steps as may be necessary to
create PublicCo and to pursue whichever of the following approaches for
accessing the public market and achieving liquidity for the Securityholders the
General Partner selects:

(i) The General Partner may cause PublicCo to sell common stock to the public,
in which case, PublicCo shall invest the proceeds of such sale of common stock
in additional interests in the Partnership or AS Holdings (as the case may be)
and such proceeds shall either be used for the Business or for distribution to
the Securityholders. In such event, any Securityholder shall be entitled to
cause PublicCo to sell in such public offering, indirectly for the account of
such Securityholder, a number of shares of PublicCo common stock equal to the
number of shares that such Securityholder would have been able to sell for its
own account if it had exchanged its Securities for shares in PublicCo (based on
such Securityholder’s proportionate rights to liquidating distributions under
Section 4.2 of the Partnership Agreement) and exercised its registration rights
described and set forth in Schedule III attached hereto, subject to the terms
thereof. Upon such sale, the net proceeds thereof shall be distributed to such
Securityholder as a distribution in respect of or in redemption of such
Securityholder’s interest in the Partnership.

(ii) The General Partner may cause PublicCo to offer to exchange shares of its
common stock with any Securityholder for some or all of such Securityholders’
Securities, at any time or from time to time. In such event, the General Partner
may cause PublicCo to sell common stock to the public in a primary offering, the
proceeds of which would be used for the Business and the General Partner may
cause there to occur one or more secondary offerings. In either event, the
Securityholders shall have, with respect to their shares of common stock of
PublicCo, the registration rights described and set forth in Schedule III
attached hereto.

 

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(iii) The General Partner may determine that a strategy that combines the above
two alternatives would be in the best interests of the parties, in which case
the rights of each Securityholder and obligations of the General Partner and its
Affiliates under this subsection (c) shall be appropriately modified so each
such party shall effectively realize or be subject to the same rights and
obligations as provided herein.

In the event of any Public Liquidity Event of the sort described in this
Section 5.2, PublicCo will be added as a party to this Agreement, the terms
hereof shall be revised as appropriate to reflect the addition of PublicCo and
an appropriate division of the rights and obligations of the Partnership
hereunder among PublicCo and the Partnership, with the intent that the
Securityholders, PublicCo and the Partnership shall continue to have rights and
obligations equivalent to their rights and obligations hereunder (except to the
extent such provisions terminate in accordance with the terms, whether as a
result of a Qualified Public Offering or otherwise).

Section 5.3 Procedures and Obligations.

(a) Performance and Assurances. Each of the parties hereto shall, in the event
that the General Partner chooses to pursue a Public Liquidity Event, take all
reasonable steps to cooperate in the process of effectuating such Public
Liquidity Event, including: executing such amendments to this Agreement and the
Schedules hereto and the Partnership Agreement as may be required to reflect the
existence and role of PublicCo, providing pertinent information and
certification as to such Securityholder (including the information contemplated
by Section 8.2), complying with the provisions and procedures described and set
forth in Schedule III attached hereto and taking such other actions as may be
reasonably required in the course of effectuating the Public Liquidity Event. If
the General Partner selects a structure for a Public Liquidity Event that
requires some form of indirect registration of shares (that is, a registration
of shares of PublicCo in a primary offering the proceeds of which will be
distributed to Securityholders in respect of their Securities) the parties will
interpret the provisions of this Agreement and the registration rights described
and set forth on Schedule III attached hereto to provide the exit priorities and
proportional treatment contemplated herein and in such Schedule.

(b) Computations. Whenever a Securityholder has a right to cause shares of the
common stock of PublicCo to be sold (subject to the registration rights
described and set forth in Schedule III attached hereto), or a right to exchange
Securities for common stock of PublicCo, in either case in an amount based on
such Securityholder’s proportionate rights to liquidating distributions under
Section 4.2 of the Partnership Agreement, the aggregate number of shares which
such Securityholder shall have a right to cause to be sold (subject to the
registration rights described and set forth in Schedule III attached hereto) or
to receive shall be that number which, taking into account the surrender of the
Securities exchanged therefor and any distributions made to such Securityholder
of the proceeds from the sale thereof (including for computation purposes a
deemed distribution of any underwriters spread or discount payable in connection
with such sale) preserves such Securityholder’s aggregate proportionate right to
distributions from the Partnership and PublicCo. For purposes of this
computation, any distribution of the proceeds from the sale of shares (including
for computation purposes a deemed distribution of any underwriters spread or
discount payable in connection with such sale) shall be deemed a liquidating
distribution under Section 4.2 of the Partnership Agreement.

 

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(c) Exchange. If the General Partner causes PublicCo to offer to exchange shares
of its common stock for Securities, such exchange shall be made based on each
Securityholder’s proportionate rights to liquidating distributions under
Section 4.2 of the Partnership Agreement. In the event of such an exchange
offer, PublicCo will endeavor to offer an opportunity for any Securityholder
that holds Securities through a United States corporation with no assets or
liabilities other than such Securities to exchange shares of stock held by such
Securityholder in such corporation (which exchange shall, at such investor’s
election, to the extent possible, to be structured as a transaction qualifying
as a reorganization under Section 368(a) of the Internal Revenue Code) in the
event of any such exchange. Any such exchange right shall be exercised by a
written notice of the Securityholder to the transfer agent of PublicCo stating
that such Securityholder desires to exchange such Securities into a
proportionate number of shares of the PublicCo common stock, and by instruments
of transfer to the transfer agent, in form satisfactory thereto, duly executed
by such Securityholder or such Securityholder’s duly authorized attorney. The
number of shares of PublicCo common stock to be exchanged for a percentage of
interests shall be subject to adjustment as provided in Section 5.3(d) hereof.
Upon the date any such exchange is effected all rights of the Securityholder of
the exchanged Securities shall cease, and the person or persons in whose name or
names the shares of PublicCo are to be issued shall be treated for all purposes
as having become the record holder or holders of such shares.

(d) Adjustments. In the event of a reclassification or other similar transaction
as a result of which the shares of PublicCo common stock are converted into
another security, then a Securityholder shall be entitled to receive upon
exchange of the Securities the amount of such security that such Securityholder
would have received if such exchange had occurred immediately prior to the
record date of such reclassification or other similar transaction. No
adjustments in respect of dividends shall be made upon the exchange of any
Securities. Any exchange rights and indirect registration rights shall be
adjusted proportionately if there is: (i) any subdivision, combination or
distribution of the Securities that is not accompanied by an identical
subdivision or combination of the PublicCo common stock; or (ii) any
subdivision, combination or distribution of the PublicCo common stock that is
not accompanied by an identical subdivision or combination of the Securities. In
the event PublicCo (i) issues or otherwise distributes options, rights or
warrants (other than to employees as compensation), (ii) merges or consolidates
with or into another entity, (iii) sells or transfers or otherwise disposes of
all or substantially all of its assets, or (iv) engages in any other, similar
transaction affecting the PublicCo, common stock, the exchange and indirect
registration rights described herein shall be appropriately adjusted.

(e) Expenses. All reasonable expenses of the parties hereto incurred in
connection with a Public Liquidity Event shall be for the account of the
Partnership except as contemplated by Schedule III attached hereto.

ARTICLE VI

TERMINATION

Section 6.1 Termination.

(a) Article V of this Agreement shall terminate and, except as otherwise
expressly provided herein, shall be of no further force and effect and shall not
be binding upon any party hereto upon the occurrence of a Qualified Public
Offering (provided that if a Qualified Public Offering occurs with respect to
only a portion of the Business as contemplated by the last sentence of
Section 5.1(a), such provision shall be revised to apply only to the
Securityholders’ interest in the portion of the Business that was not the
subject of the Qualified Public Offering). This Agreement shall terminate
(i) upon the dissolution, liquidation or winding up of the Partnership or
PublicCo, (ii) upon the approval of such termination by each Securityholder, or
(iii) following a Qualified Public Offering, as to each Securityholder and its
Permitted Transferees, upon (and only upon) notice from the Partnership which
may only be given if such Securityholder and its Permitted Transferees cease to
hold a number of Securities (other than Securities that have been sold in a
Public Transfer) at least equal to (x) in the case of each of Acquisition, Bodal
and Coastal, 10% of the largest number of Securities held by such party and its
Permitted Transferees from the date hereof to the date of such notice and (y) in
the case of any other Securityholder, 15% of the largest number of Securities
held by such Securityholder and its Permitted Transferees from the date hereof
to the date of such notice. In any event, all provisions of this Agreement shall
terminate on December 31, 2025.

 

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(b) As to any particular Securityholder, this Agreement shall no longer be
binding or of further force or effect as to such Securityholder, except as noted
below or otherwise expressly provided herein, as of the date such Securityholder
has Transferred all of such Securityholder’s Securities and the transferee(s) of
such Securities, if required by this Agreement, shall have become a party
hereto; provided however, that no such termination shall be effective if such
Securityholder is in breach of this Agreement.

ARTICLE VII

BOARD COMPOSITION

Section 7.1 Coastal Board Rights.

(a) For so long as Coastal (together with its Affiliates and Permitted
Transferees) is the direct holder of at least 150,000 Partnership Units
(adjusted to reflect splits or similar transactions), then (i) for so long as
the Partnership is organized as a limited partnership, the General Partner shall
include on the Board two members nominated by Coastal, neither of whom is
required to be an Independent Director, and (ii) if at any time the
Securityholders have the right to elect members of the Board, each
Securityholder agrees that it shall vote all of the Partnership Units owned by
it so as to elect such nominees of Coastal to the Board. For so long as Coastal
(together with its Affiliates and Permitted Transferees) is the direct holder of
at least 75,000 Partnership Units (adjusted to reflect splits or similar
transactions), then (i) for so long as the Partnership is organized as a limited
partnership, the General Partner shall include on the Board one member nominated
by Coastal, who is not required to be an Independent Director, and (ii) if at
any time the Securityholders have the right to elect members of the Board, each
Securityholder agrees that it shall vote all of the Partnership Units owned by
it so as to elect such nominee of Coastal to the Board.

(b) In addition to Coastal’s right to nominate two members of the Board pursuant
to Section 7.1(a), for so long as Coastal (together with its Affiliates and
Permitted Transferees) is the direct holder of at least 257,000 Partnership
Units (adjusted to reflect splits or similar transactions), then (i) for so long
as the Partnership is organized as a limited partnership, the General Partner
shall include on the Board one member nominated by Coastal, who shall be an
Independent Director approved in accordance with Section 7.8 (a “Coastal
Independent Director”), and (ii) if at any time the Securityholders have the
right to elect members of the Board, each Securityholder agrees that it shall
vote all of the Partnership Units owned by it so as to elect such nominee of
Coastal to the Board.

(c) If any nominee of Coastal resigns or otherwise fails, declines or ceases to
serve as a member of the Board, Coastal may nominate a replacement, subject to
the provisions of Section 7.8. No person nominated hereunder may be a Competitor
or a Foreign Person.

 

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(d) The right to nominate members of the Board set forth in Section 7.1(a) shall
be transferable as follows: (i) the right to nominate one member of the Board
that is an Independent Director shall be transferable to a Transferee of not
less than 60,000 of Coastal’s Partnership Units (adjusted to reflect splits or
similar transactions), without regard to any Securities transferred by Coastal
to such Transferee under clause (ii) or clause (iii) below, and shall be
exercisable by such Transferee only for so long as such Transferee is the direct
holder of at least 60,000 Partnership Units (adjusted to reflect splits or
similar transactions), together with such additional Partnership Units, if any,
as are required to qualify such Transferee to nominate members of the board
under clause (ii) or clause (iii) below; (ii) the right to nominate two members
of the Board that are Coastal Affiliated Directors shall be transferable to a
Transferee of not less than 150,000 of Coastal’s Partnership Units (adjusted to
reflect splits or similar transactions), without regard to any Partnership Units
transferred by Coastal to such Transferee under clause (i) above, and shall be
exercisable by such Transferee only for so long as such Transferee is the direct
holder of at least 150,000 Partnership Units (adjusted to reflect splits or
similar transactions), together with such additional Partnership Units, if any,
as are required to qualify such Transferee to nominate an Independent Director
under clause (i) above; and (iii) the right to nominate one member of the Board
that is a Coastal Affiliated Director shall be transferable to a Transferee of
not less than 75,000 of Coastal’s Partnership Units (adjusted to reflect splits
or similar transactions), without regard to any Partnership Units transferred by
Coastal to such Transferee under clause (i) above, and shall be exercisable by
such Transferee only for so long as such Transferee is the direct holder of at
least 75,000 Partnership Units (adjusted to reflect splits or similar
transactions), together with such additional Partnership Units, if any, as are
required to qualify such Transferee to nominate an Independent Director under
clause (i) above; provided that any Transfer (other than to a Permitted
Transferee or in Public Transfer) pursuant to clauses (i) through (iii) of this
Section 7.1(d) shall be subject to the Right of First Offer set forth in
Section 3.2. For the avoidance of doubt, the right to nominate one or more
members of the Board pursuant to Section 7.1(a) or (b) may be transferable to a
Transferee of the requisite number of Partnership Units in accordance with
clauses (i) through (iii) of this Section 7.1(d), but in no event shall Coastal
and its Transferees collectively have the right to designate more than three
members of the Board pursuant to this Section 7.1.

Section 7.2 Acquisition Board Rights.

(a) For so long as Acquisition (together with its Affiliates and Permitted
Transferees) is the direct holder of at least 106,000 Partnership Units
(adjusted to reflect splits or similar transactions), then (i) for so long as
the Partnership is organized as a limited partnership, each Securityholder
agrees that the General Partner shall include on the Board two members nominated
by Acquisition, each of which shall be an Independent Director approved in
accordance with Section 7.8, and (ii) if at any time the Securityholders have
the right to elect members of the Board, each Securityholder agrees that it
shall vote all of the Partnership Units owned by it so as to elect such nominees
of Acquisition to the Board. For so long as Acquisition (together with its
Affiliates and Permitted Transferees) is the direct holder of at least 46,000
Partnership Units (adjusted to reflect splits or similar transactions), then
(i) for so long as the Partnership is organized as a limited partnership, each
Securityholder agrees that the General Partner shall include on the Board one
member nominated by Acquisition, who shall be an Independent Director approved
in accordance with Section 7.8, and (ii) if at any time the Securityholders have
the right to elect members of the Board, each Securityholder agrees that it
shall vote all of the Partnership Units owned by it or him so as to elect such
nominee of Acquisition to the Board.

(b) If any such nominee of Acquisition resigns or otherwise fails, declines or
ceases to serve as a member of the Board, Acquisition may nominate a replacement
thereof, subject to the provisions of Section 7.8. No Person nominated hereunder
may be a Competitor or a Foreign Person.

 

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(c) The right to nominate Independent Directors set forth in Section 7.2(a)
shall be transferable as follows: (i) the right to nominate one Independent
Director shall be transferable to a Transferee of Acquisition’s securities
representing in the aggregate not less than 60,000 Partnership Units (adjusted
to reflect splits or similar transactions) and shall be exercisable by such
Transferee only for so long as such Transferee is the direct holder of at least
60,000 Partnership Units (adjusted to reflect splits or similar transactions);
and (ii) the right to nominate two Independent Directors shall be transferable
to a Transferee of Acquisition’s securities representing in the aggregate not
less than 120,000 Partnership Units (adjusted to reflect splits or similar
transactions) and shall be exercisable by such Transferee only for so long as
such Transferee is the direct holder of least 120,000 Partnership Units
(adjusted to reflect splits or similar transactions); provided that any Transfer
(other than to a Permitted Transferee or in Public Transfer) pursuant to clause
(i) or (ii) of this Section 7.2(c) shall be subject to the Right of First Offer
set forth in Section 3.2. For the avoidance of doubt, the right to nominate one
or more Independent Directors pursuant to Section 7.2(a) may be transferable to
a Transferee of the requisite number of securities in accordance with
clauses (i) and (ii) of this Section 7.2(c), but in no event shall Acquisition
and its Transferees collectively have the right to designate more than two
Independent Directors pursuant to this Section 7.2.

Section 7.3 Management Securityholders’ Board Rights.

(a) For so long as the Management Securityholders (together with their
respective Permitted Transferees) hold directly at least 150,000 Partnership
Units (adjusted to reflect splits or similar transactions), then (i) for so long
as the Partnership is organized as a limited partnership, the General Partner
shall include on the Board one member nominated by a majority in interest of the
Management Securityholders and (ii) if at any time the Securityholders have the
right to elect members of the Board, each Securityholder agrees that it shall
vote all of the Partnership Units owned by it so as to elect such nominee of the
Management Securityholders to the Board.

If any such nominee of the Management Securityholders resigns or otherwise
fails, declines or ceases to serve, the Management Securityholders may nominate
a replacement thereof. No person nominated hereunder may be a Competitor or a
Foreign Person.

(b) The right to nominate a member of the Board set forth in Section 7.3(a)
shall be transferable to a Transferee of not less than 150,000 of the Management
Securityholders’ Partnership Units (adjusted to reflect splits or similar
transactions) and shall be exercisable by such Transferee only for so long as
such Transferee is the direct holder of at least 150,000 Partnership Units
(adjusted to reflect splits or similar transactions); provided that any Transfer
(other than to a Permitted Transferee or in Public Transfer) pursuant to this
Section 7.3(c) shall be subject to the Right of First Offer set forth in
Section 3.2. For the avoidance of doubt, the right to nominate a member of the
Board pursuant to Section 7.3(a) may be transferable to a Transferee of the
requisite aggregate number of Partnership Units in accordance with this
Section 7.3(c), but in no event shall the Management Securityholders and their
Transferees collectively have the right to designate more than one member of the
Board pursuant to this Section 7.3.

Section 7.4 Bodal Board Rights.

(a) For so long as Bodal (together with his Permitted Transferees) directly
holds at least 27,200 Partnership Units (adjusted to reflect splits or similar
transactions), then (i) for so long as the Partnership is organized as a limited
partnership, the General Partner shall include on the Board one member nominated
by Bodal and (ii) if at any time the Securityholders have the right to elect
members of the Board, each Securityholder agrees that it shall vote all of the
Partnership Units owned by it so as to elect such nominee of Bodal to the Board.

(b) If any such nominee of Bodal resigns or otherwise fails, declines or ceases
to serve, Bodal may nominate a replacement thereof. No person nominated
hereunder may be a Competitor or a Foreign Person.

 

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(c) The right to nominate a member of the Board set forth in Section 7.4(a)
shall be transferable to a Transferee of not less than 75,000 of Bodal’s
Partnership Units (adjusted to reflect splits or similar transactions) and shall
be exercisable by such Transferee only for so long as such Transferee directly
holds at least 75,000 Partnership Units (adjusted to reflect splits or similar
transactions); provided that any Transfer (other than to a Permitted Transferee
or in Public Transfer) pursuant to this Section 7.4(c) shall be subject to the
Right of First Offer set forth in Section 3.2. For the avoidance of doubt, the
right to nominate a member of the Board pursuant to Section 7.4(a) may be
transferable to a Transferee of the requisite number of Partnership Units in
accordance with this Section 7.4(c), but in no event shall Bodal and his
Transferees collectively have the right to designate more than one member of the
Board pursuant to this Section 7.4.

Section 7.5 Board Composition Following Public Liquidity Event.

Upon a Public Liquidity Event, the initial members of the board of directors of
PublicCo shall include the members of the Board immediately prior to such Public
Liquidity Event.

Section 7.6 Number of Board Members; Classification.

(a) The Board shall consist of seven members, at least three of which shall be
Independent Directors elected in accordance with Section 7.8, and no more than a
minority of the number of directors necessary to constitute a quorum of the
Board may be non-U.S. citizens. In the event that any Securityholder or group of
Securityholders entitled to nominate one or more members of the Board hereunder
ceases to qualify so to nominate one or more of such members, then, unless the
right to nominate such member or members has been transferred in accordance with
this Article VII, the Securityholders, voting as a class in proportion to the
Partnership Units they hold, shall be entitled to nominate one or more directors
to fill the Board seat or seats formerly filled by such nominees of such
Securityholder or group of Securityholders. The initial members of the Board
(the “Initial Directors”) are set forth in Exhibit A attached hereto and have
been nominated as set forth therein.

(b) The members of the Board shall be divided into three classes. Membership in
such classes shall be as nearly equal in number as possible. The classification
of the Initial Directors shall be as set forth in Exhibit A attached hereto, and
the respective terms of service of the Initial Directors shall expire at the
annual election of directors by the General Partner or the Securityholders, as
the case may be, in the respective calendar years specified for each class of
Initial Directors in Exhibit A attached hereto, or thereafter when their
respective successors have been elected and have qualified, in each case subject
to prior death, resignation, retirement, disqualification or removal from office
in accordance with this Agreement. At each succeeding annual election of
directors of each class by the General Partner or the Securityholders, as the
case may be, the directors elected to succeed those whose terms then expire
shall be identified as being of the same class as the directors they succeed and
shall be elected for a term expiring at the third succeeding annual election of
directors by the General Partner or the Securityholders, as the case may be, or
thereafter when their respective successors have been elected and have
qualified.

Section 7.7 Resignation and Removal.

(a) Any director may resign at any time by submitting an electronic transmission
or by delivering a written notice of resignation, signed by such director, to
the chief executive officer or the secretary of the General Partner. Unless
otherwise specified therein, such resignation shall take effect upon delivery. A
replacement to fill a vacancy in the Board created by the resignation of an
Affiliated Director shall be nominated by the party that nominated such
Affiliated Director or by such party’s Transferee. The process for electing a
replacement to fill a vacancy in the Board created by the resignation of an
Independent Director shall be governed by the provisions of Section 7.8. Any
replacement director of any class elected to fill a vacancy resulting from
resignation of a director of such class shall hold office for a term that shall
coincide with the remaining term of that class.

 

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(b) Any Affiliated Director may be removed from office with or without cause at
any time by the party that nominated such Affiliated Director, and a replacement
to fill the vacancy in the Board created by the removal of such Affiliated
Director shall be nominated by the party that nominated such Affiliated Director
or by such party’s Transferee. No Independent Director may be removed from
office other than for Cause; provided, however, that failure to continue to meet
the independent requirements set forth in the definition of “Independent
Director” in Section 1.1 shall be deemed to establish Cause for removal. The
process for electing a replacement to fill a vacancy in the Board created by the
removal of an Independent Director shall be governed by the provisions of
Section 7.8.

Section 7.8 Independent Directors.

(a) In the event that any Initial Director who is an Independent Director (an
“Initial Independent Director”) declines or is otherwise unable to serve prior
to beginning service, a replacement to fill a vacancy in the Board created by
the resignation of an Independent Director shall be nominated by the party that
nominated such Independent Director or by such party’s Transferee; provided,
however, that in either case such nomination shall be acceptable to Coastal or
Acquisition, as applicable, it being understood that in approving any
replacement Initial Independent Director candidate nominated by the other party,
each of Coastal and Acquisition may exercise its sole discretion and need not
provide explanations if it elects not to approve a candidate nominated by the
other party.

(b) Upon death, disability, removal, resignation or expiration of the term of
service of any Independent Director, the party that nominated such Independent
Director or such party’s Transferee shall have the right, in such party’s sole
discretion, (i) in the event of expiration of the term of service of such
Independent Director, to nominate the individual whose term of service is
expiring to be reelected as a member of the Board for the succeeding three-year
term or (ii) to nominate a new candidate satisfying the Independent Director
requirements set forth in the definition of “Independent Director” in
Section 1.1.

(c) In the event an Independent Director is nominated to be reelected as an
Independent Director pursuant to clause (i) of Section 7.8(b), then the General
Partner or the Securityholders, as applicable, shall cause such individual to be
elected as a member of the Board as set forth in Sections 7.1 through 7.4.

(d) Prior to nominating a new candidate to be elected as member of the Board
pursuant to clause (ii) of Section 7.8(b), Coastal and Acquisition shall
disclose to the other party the names of any the proposed nominee and discuss
the qualifications of such nominee. The nominating party shall give a written
notice of such nomination (which notice shall include a description, in
reasonable detail, of such candidate’s identity and background) (a “Nomination
Notice”) to the other party and the General Partner. Unless the other party
objects to the nominated candidate within ten (10) days of receiving the
Nomination Notice with respect to such candidate’s nomination (the “Objection
Period”), such candidate shall be submitted for election and the General Partner
or the Securityholders, as applicable, shall cause such individual to be elected
as a member of the Board as set forth in Sections 7.1 through 7.4.

 

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(e) If the other party objects to the nominated candidate within the Objection
Period, the nominating party shall submit two candidates (one of whom may be the
candidate to whom the other party has objected) each of whom satisfies the
Independent Director requirements set forth in the definition of “Independent
Director” in Section 1.1, to a special committee (the “Special Committee”)
consisting of the other two Independent Directors and one of the Affiliated
Directors designated by the non-nominating party. If there are two Independent
Director vacancies in the Board created by the death, removal, resignation or
expiration of the term of service of any Independent Director, the Special
Committee shall consist of the remaining Independent Director, one Affiliated
Director appointed by the nominating party and one Affiliated Director appointed
by the non-nominating party. If all seats on the Board reserved for Independent
Directors are vacant, the Special Committee shall consist of one Affiliated
Director appointed by the nominating party and two Affiliated Directors
appointed by the non-nominating party. The position of an Independent Director
whose term is expiring and who is not being proposed for reelection shall be
considered a vacancy, and such Independent Director shall not participate on the
Special Committee unless the non-nominating party consents to such
participation. The Special Committee shall have the right to interview, perform
background checks and request other reasonable information (comparable to
information required to be provided by directors of public corporations) from
both candidates. Within twenty (20) business days from the date the nominating
party submits the two candidates to the Special Committee, the Special Committee
shall approve one of the two candidates for election to the Board. If the
Special Committee fails, within such twenty (20) business day period, to approve
one of the two candidates for election to the Board (other than due to a lack of
cooperation by the candidates or the nominating party), then the nominating
party may select the candidate to be elected in its sole discretion. Upon such
approval of one of the candidates by the Special Committee or upon such
selection of one of the candidates by the nominating party in the event of the
Special Committee’s failure to approve either candidate, as the case may be, the
General Partner or the Securityholders, as applicable, shall cause such
individual to be elected as a member of the Board as set forth in Sections 7.1
through 7.4.

Section 7.9 Election by General Partner.

Subject to the provisions of Section 7.8, whenever the General Partner has
agreed hereunder to include on the Board particular Persons or nominees,
Acquisition and Coastal shall, and shall cause their respective Affiliates to,
vote their shares of the General Partner so as to elect such Persons or nominees
to the Board.

Section 7.10 Committees.

(a) The Board shall have an Audit Committee (the “Audit Committee”), a
Compensation Committee (the “Compensation Committee”) and a Finance Committee
(the “Finance Committee” and, together with the Audit Committee and the
Compensation Committee, the “Board Committees”). The Board Committees shall
initially be composed of the Board members identified on Exhibit A attached
hereto. Thereafter, the composition of the Board Committees shall be as follows:

(i) the Audit Committee shall consist of at least three members, one of whom
shall be a Coastal Affiliated Director and two of whom shall be Independent
Directors appointed by a majority of the Independent Directors;

(ii) the Compensation Committee shall consist of at least two members, one of
whom shall be a Coastal Affiliated Director and one of whom shall be an
Independent Director appointed by a majority of the Independent Directors;
provided that the chief executive officer of the Partnership shall be an
ex-officio, non-voting member of the Compensation Committee but shall not
participate in the deliberations of the Compensation Committee relating to his
compensation and benefits; and

(iii) the Finance Committee shall consist of at least three members, one of whom
shall be a Management Affiliated Director, one of whom shall be a Coastal
Affiliated Director and one of whom shall be an Independent Director appointed
by a majority of the Independent Directors.

 

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(b) Each of the Board Committees shall have the authority to recommend action to
the full Board within such Board Committee’s area of responsibility, but shall
not have the authority to take final action binding upon the Partnership except
as may be specifically agreed upon by Coastal and Acquisition from time to time,
or as may be required by applicable laws or regulations or by the listing
requirements of any securities exchange on which any of the Securities may be
listed from time to time.

ARTICLE VIII

OTHER MATTERS

Section 8.1 Confidential Information.

The Board shall take appropriate steps to ensure that any confidential
information in the possession of the Partnership or the Board shall be used only
for Partnership purposes and not for any other purpose. Such steps may include
without limitation the establishment of Board procedures designed to prevent
access by any Competitor or its representatives to any such confidential
information.

Section 8.2 Fisheries and Vessel Documentation Matters.

(a) In General. Each Securityholder recognizes and acknowledges that the
Business and the Partnership are subject to complex regulatory provisions
relating to fisheries management, vessel documentation and ownership and other
maritime matters. The Partnership is required to satisfy certain foreign
ownership requirements that require the provision of detailed information and
may require, including in response to changing circumstances thereafter,
alterations in the Partnership’s capital structure and/or ownership. Each
Securityholder agrees, at the request of the General Partner, promptly to
furnish to the General Partner such information as to such Securityholder’s
citizenship, domicile or residence, management, ownership, and capital structure
(and, to the extent it is reasonably able to obtain it, such information as to
the citizenship, domicile or residence, management, ownership and capital
structure of each Person that holds, directly or indirectly, an equity interest
in or other right to control such Securityholder) as the General Partner shall
request in order to comply, or to evaluate the Partnership’s compliance, with
such regulatory requirements.

 

(b) Automatic Redemption. To provide a mechanism for automatically reducing the
Foreign Ownership Percentage of the Partnership, each Securityholder agrees that
if at any time after the date hereof the Foreign Ownership Percentage of the
Partnership shall exceed the Safe Harbor Percentage, there shall automatically
be redeemed (retroactively as the date such percentage shall have been exceeded)
and exchanged for Redemption Securities a number of Securities held by Remedial
Conversion Holders sufficient to cause the Foreign Ownership Percentage of the
Partnership as at the pertinent date not to exceed the Safe Harbor Percentage.
The principal amount of the notes included in the Redemption Securities issued
in exchange for such Securities shall be the Fair Market Value thereof;
provided, however, that if the recipients of 25% or more of the Redemption
Securities issued as of any date object to the Board’s determination thereof,
the fair market value shall be redetermined by an investment banking or
appraisal firm selected in good faith by the Board and the principal amount of
Redemption Securities shall be adjusted if and to the extent that such firm’s
determination differs from the determination of the Board. Such redemption shall
be apportioned among the Remedial Conversion Holders in proportion to their
respective holdings of Partnership Units or other Securities that are taken into
account in determining the Partnership’s Foreign Ownership Percentage. No
Remedial Conversion Holder and no other Securityholder shall have any right to
oppose, retard, object to or otherwise inhibit such redemption, which shall be
automatic and irrevocable.

 

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(c) “Excessive Shares” Restriction. Each Securityholder agrees that if at any
time it or its Affiliates holds an interest in any Person, vessel, processing
facility or other assets as a result of which any limitation or restriction is
imposed (or but for this provision would be imposed) on the quantity of any fish
or shellfish which may be harvested or processed by the Partnership or its
Subsidiaries and their successors and assigns under applicable provisions of the
American Fisheries Act and any regulations thereunder or relevant thereto, there
shall automatically be redeemed (retroactively as of the date such limitation or
restriction would have been applicable) and exchanged for Redemption Securities
solely of the type described by clause (i) of the definition thereof a number of
Securities held by such Securityholder sufficient to cause such limitation or
restriction not to be applicable or further applicable. The principal amount of
the notes constituting the Redemption Securities issued in exchange for such
Securities shall be the Fair Market Value thereof. No affected Securityholder
shall have any right to oppose, retard, object to or otherwise inhibit such
redemption, which shall be automatic and irrevocable.

Section 8.3 Remedies. The Partnership and the Securityholders acknowledge and
agree that in the event of any breach of this Agreement by any one of them, the
Partnership the relevant Securityholder or Securityholders, as the case may be,
would be irreparably harmed and could not be made whole by monetary damages. The
Partnership and the Securityholders accordingly agree (a) to waive the defense
in any action for specific performance that a remedy at law would be adequate
and (b) that the Partnership and the Securityholders, in addition to any other
remedy to which they may be entitled at law or in equity, shall be entitled to
compel specific performance of this Agreement.

Section 8.4 Rights and Obligations of Transferees; New Issuances.

(a) Upon Transfer of any Securities by any Securityholder to a Permitted
Transferee, such Permitted Transferee shall (i) execute and deliver to the
Partnership an agreement to be bound by this Agreement reasonably satisfactory
in form and substance to the Partnership and (ii) have all of the rights and be
bound by all of the obligations hereunder of a Blocker Corporation, Additional
Securityholder or Management Securityholder, as the case may be.

(b) Upon Transfer of any Securities by Acquisition or Coastal, as the case may
be, to a Permitted Transferee, such Permitted Transferee shall (i) execute and
deliver to the Partnership an agreement to be bound by this Agreement reasonably
satisfactory in form and substance to the Partnership and (ii) have all of the
rights and be bound by all of the obligations hereunder of Acquisition or
Coastal, as the case may be.

(c) Any Transferee (other than a Permitted Transferee) of any Blocker
Corporation, Additional Securityholder or Management Securityholder, as the case
may be, shall (i) execute and deliver to the Partnership an agreement to be
bound by this Agreement reasonably satisfactory in form and substance to the
Partnership and (ii) have all of the rights and be bound by all of the
obligations hereunder of an Additional Securityholder or Management
Securityholder, as the case may be, except that (A) no such Transferee shall
have any right to designate members of the Board pursuant to Section 7.3 (except
to the extent specifically so stated in the instrument of Transfer in conformity
with Section 7.3(c) or Section 7.4(c)) and (B) no such Transferee of Securities
pursuant to a Transfer under Section 3.1(a) shall have any rights under
Section 3.1(a).

 

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(d) Any Transferee (other than a Permitted Transferee) of Acquisition or
Coastal, as the case may be, shall (i) execute and deliver to the Partnership an
agreement to be bound by this Agreement reasonably satisfactory to the
Partnership and (ii) be bound by all of the obligations of Acquisition or
Coastal, as the case may be, hereunder and have only those rights of Acquisition
or Coastal, as the case may be, hereunder as Acquisition or Coastal, as the case
may be, shall determine in its sole discretion, except that (A) no such
Transferee shall have any right to designate members of the Board pursuant to
Section 7.1 or Section 7.2, as applicable (except to the extent specifically so
stated in the instrument of Transfer in conformity with Section 7.1(d) or
Section 7.2(c), as applicable) and (B) no such Transferee shall have any
obligation under Section 3.1(a).

(e) Notwithstanding anything to the contrary contained herein, a Transferee in a
Public Transfer shall not have any rights or obligations under this Agreement
with respect to the Securities Transferred.

(f) In the event Securities are issued by the Partnership to a Securityholder at
any time during the term of this Agreement, such Securities shall, as a
condition to such issuance, become subject to the terms and provisions of this
Agreement as Securities hereunder. In the event Securities are issued by the
Partnership to Subsequent Additional Securityholders, such Subsequent Additional
Securityholders shall be required to execute an agreement to be bound by this
Agreement as Additional Securityholders. In the event Securities are issued by
the Partnership to Additional Management Securityholders, such Additional
Management Securityholders shall be required to execute an agreement to be bound
by this Agreement as a Management Securityholder. In the event Securities are
issued by the Partnership to other parties, such parties shall be required to
execute an agreement to be bound by this Agreement and shall receive the rights
hereunder deemed appropriate by the Partnership.

Section 8.5 Spousal Consent. Each Securityholder who is married as of the date
hereof represents and warrants that he or she has delivered to the Partnership a
separate consent and agreement executed by his or her spouse in a form
reasonably acceptable to the Partnership (a “Spousal Consent”). Additionally, to
the extent not previously delivered and if requested by the Partnership, each
Securityholder who is an individual shall cause his or her spouse, as
applicable, to execute and deliver a Spousal Consent. The signature of a spouse
on a Spousal Consent shall not be construed as making such spouse a
securityholder of the Partnership or a party to this Agreement except as may
otherwise be set forth in such consent. Each Securityholder who is an individual
will certify his or her marital status to the Partnership at the Partnership’s
request.

Section 8.6 Successors and Assigns. Subject to Section 7.5, this Agreement, and
all obligations and rights hereunder, shall be binding upon and shall inure to
the benefit of the parties hereto and their respective successors and permitted
assigns.

Section 8.7 No Waivers; Amendments.

(a) 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. The rights and remedies herein provided
shall be cumulative and not exclusive of any rights or remedies provided by law.

(b) This Agreement may be amended or modified only by a writing signed by each
of (i) the Partnership, (ii) Acquisition, (iii) Coastal, (iv) Additional
Securityholders holding at least 50% of the aggregate number of Securities held
by all Additional Securityholders, and (v) Management Securityholders holding at
least 50% of the Securities then held by all Management Securityholders on a
fully diluted basis; provided that no amendment that materially and adversely
affects a particular Securityholder without similarly affecting similarly
situated Securityholders may be made without the consent of such Securityholder.

 

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(c) Any provision of this Agreement may be waived if, but only if, such waiver
is in writing and is signed by the party against whom the enforcement of such
waiver is sought.

Section 8.8 Certain Consents; Major Transactions.

(a) Each of Acquisition and Coastal and their respective Affiliates agree not to
cause or permit the Partnership to take any of the following actions without the
affirmative consent of holders of two-thirds of the Securities issued and
outstanding at the relevant time:

(i) the adoption of any plan or program providing for the issuance or grant of
any Securities or any securities of any subsidiary of the Partnership, or
providing for the issuance or grant of any option or warrant to purchase any
securities of any subsidiary of the Partnership, to a member of management of
the Partnership or any subsidiary of the Partnership who at the time of such
issuance or grant is serving or has served, subsequent to the date of this
Agreement, as a Senior Officers of the Partnership, Holdings, Consolidated, ASG
Consolidated, Group or any of their principal business units or Affiliates, or
the adoption of any other executive or incentive compensation plan or program in
which any such Person is eligible to participate;

(ii) the issuance of any Securities or any securities of any subsidiary of the
Partnership, or of any option or warrant to purchase any securities of any
subsidiary of the Partnership, to a member of management of the Partnership or
of any subsidiary of the Partnership who at the time of such issuance or grant
is serving or has served, subsequent to the date of this Agreement, as a Senior
Officer of the Partnership, Holdings, Consolidated, ASG Consolidated, Group or
any of their principal business units of Affiliates, or the material
modification of the terms of any prior issuance of Securities or securities of
any subsidiary of the Partnership or of any such options or warrants to any such
Person, in either case other than pursuant to a plan or program approved as
provided in clause (i) of this Section 8.8(a) and administered by the
Compensation Committee;

(iii) the making, material modification of the terms or forgiveness of any loan,
guarantee or similar extension of credit by the Partnership or any of its
subsidiaries to any member of management of the Partnership or of any subsidiary
of the Partnership who at the time of such issuance or grant is serving or has
served, subsequent to the date of this Agreement, as a Senior Officer of the
Partnership, AS Holdings, Consolidated, ASG Consolidated, Group or any of their
principal business units of Affiliates, in an amount in excess of $100,000;
provided that any such loan, guarantee or similar extension of credit to any
such Person in amount below $100,000 shall be subject to approval by the
Compensation Committee (it being understood that such approval may be deemed to
have been granted pursuant to a compensation plan, program or policy previously
recommended by the Compensation Committee and approved by the Board or by the
Compensation Committee pursuant to authority delegated to the Compensation
Committee by the Board); and

(iv) the filing with the Commission of any Registration Statement or the
consummation of any Public Liquidity Event.

 

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(b) The General Partner shall notify the Finance Committee prior to making any
capital expenditures, acquisitions or dispositions of Partnership assets in
excess of $1,000,000. The General Partner shall notify and actively engage the
Finance Committee as soon as practicable after the Partnership begins to
actively pursue plans to make any material capital expenditure, acquisition or
disposition, or a series or combination of related capital expenditures,
acquisitions, or dispositions, or to enter into any material credit facility or
other material transaction. For purposes of the foregoing sentence, a “material”
transaction shall mean any transaction with a level of materiality that would
reasonably be expected to require the filing of a Form 8-K under the Exchange
Act with the Commission. If the amount of such capital expenditure, acquisition,
disposition, or a series or combination of related capital expenditures,
acquisitions or dispositions, is reasonably likely to be in excess of
$30,000,000, or if the amount of such credit facility, or a series or
combination of related credit facilities, is reasonably likely to be in excess
of $100,000,000, such transaction may not be consummated unless it is
recommended by a majority of the Finance Committee and authorized and approved
by a majority of the full Board, including the affirmative vote of all of the
Independent Directors.

Section 8.9 Voting of Blocker Shares.

Whenever any matter is to be voted on by the holders of Securities, Securities
held by the Blocker Corporations shall be so voted as directed by the holders of
Blocker Shares in proportion to their holdings of such shares.

Section 8.10 Notices. All notices, requests and other communications to any
party hereunder shall be in writing (including telecopy or similar writing) and
shall be given,

 

(1) if to the Partnership:

American Seafoods, L.P.

Market Place Tower

2025 First Avenue, Suite 900

Seattle, Washington 98121

Attn: Matthew D. Latimer, Esq.

Facsimile: (206) 374-1516

with a copy to:

Heller Ehrman LLP

701 Fifth Avenue

Suite 6100

Seattle, Washington 98104

Attn: Bruce M. Pym, Esq.

Facsimile: (206) 447-0849

 

(2) if to Coastal:

Coastal Villages Pollock LLC

711 H Street, Suite 200

Anchorage, Alaska 99501

Attention: Mr. Morgen Crow

Facsimile: (907) 278-5150

 

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with a copy to:

Preston Gates & Ellis LLP

925 Fourth Avenue

Suite 2900

Seattle, Washington 98104

Attn: Richard B. Dodd, Esq.

Facsimile: (206) 370-6084

 

(3) if to any Management Securityholder:

The addresses set forth on Schedule II attached hereto

 

(4) if to a Blocker Corporation:

Coastal Villages Pollock LLC

711 H Street, Suite 200

Anchorage, Alaska 99501

Attention: Mr. Morgen Crow

Facsimile: (907) 278-5150

and, in the case of CP3 Tax-Exempt, Inc.:

Bernt O. Bodal

Market Place Tower

2025 First Avenue, Suite 900

Seattle, Washington 98121

Facsimile: (206) 374-1516

 

(5) if to Acquisition:

ASLP Acquisition LLC

c/o Bernt O. Bodal

Market Place Tower

2025 First Avenue, Suite 900

Seattle, Washington 98121

Facsimile: (206) 374-1516

with a copy to:

Debevoise & Plimpton LLP

919 Third Avenue

New York, New York 10022

Attn: Jeffrey J. Rosen, Esq.

Facsimile: (212) 909-6836

or to such other address or telecopy number and with such other copies, as such
party may hereafter specify for the purpose by notice to the other parties. Each
such notice, request or other communication shall be effective (i) if given by
telecopy, when such telecopy is transmitted to the telecopy number specified in
this Section and evidence of receipt is received or (ii) if given by any other
means, upon delivery or refusal of delivery at the address specified in this
Section 8.10.

 

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Section 8.11 Inspection. So long as this Agreement shall be in effect, this
Agreement and any amendments hereto shall be made available for inspection by
any Securityholder at the principal offices of the Partnership.

Section 8.12 Governing Law; Submission to Jurisdiction. This Agreement, the
legal relations between the parties and any action, whether contractual or
non-contractual, instituted by any party with respect to matters arising under
or in connection with or in respect of this Agreement, including but not limited
to the negotiation, execution, interpretation, coverage, scope, performance,
breach, termination, validity, or enforceability of this Agreement, shall be
governed by and construed in accordance with the laws of the State of New York
applicable to contracts made and performed in such State and without regard to
conflicts of law doctrines, except to the extent that certain matters are
preempted by federal law or are governed as a matter of controlling law by the
law of the jurisdiction of organization of the respective parties. Each party
hereby irrevocably submits to and accepts for itself and its properties,
generally and unconditionally, the non-exclusive jurisdiction of the United
States District Court for the Southern District of New York or any state court
sitting in the County of New York (and of the appropriate appellate courts) with
respect to any action seeking to enforce any provision of, or based on any
matter arising out of or in connection with this Agreement or any of the
transactions contemplated hereby, and each of the parties hereby waives any
defense of forum non conveniens and any objection to venue laid therein and
agrees to be bound by any judgment rendered thereby arising under, out of, in
respect of or in connection with this Agreement. Each party further irrevocably
accepts for itself and its properties, generally and unconditionally, service of
process pursuant to the laws of the State of New York and the rules of its
courts, and designates and appoints the individuals identified in or pursuant to
Section 8.10 hereof to receive notices on its behalf. A copy of any such process
so served shall be mailed by registered mail to the designated agent of each
party at its address provided in Section 8.10; provided that, unless otherwise
provided by applicable law, any failure to mail such copy shall not affect the
validity of the service of such process. If any agent so appointed refuses to
accept service, the designating party hereby agrees that service of process
sufficient for personal jurisdiction in any action against it in the applicable
jurisdiction may be made by registered or certified mail, return receipt
requested, to its address provided in Section 8.10. Each party hereby
acknowledges that such service shall be effective and binding in every respect.
Nothing herein shall affect the right to serve process in any other manner
permitted by law or shall limit the right of any party to bring any action or
proceeding against the other party in any other jurisdiction, except to the
extent expressly otherwise provided in this Section.

Section 8.13 Confidentiality. Except as required by applicable law, rules or
regulations of any jurisdiction having proper jurisdiction over the parties
hereto or as requested by the U.S. Securities and Exchange Commission, Internal
Revenue Service, any other regulatory body or any court of competent
jurisdiction, this Agreement and other agreements relating to the transactions
described in the recitals hereto are confidential and may not be disclosed to
any third party, except with respect to the officers, employees and service
providers to a party to this Agreement and other agreements relating to the
transactions described in the recitals hereto who need to know such information
in the ordinary course of performing their duties, provided that such officers,
employees and service providers are subject to confidentiality obligations at
least as restrictive as those imposed by this Agreement.

Section 8.14 Captions. The captions herein are included for convenience of
reference only and shall be ignored in the construction or interpretation
hereof.

Section 8.15 Entire Agreement. This Agreement and the other agreements relating
to the transactions described in the recitals hereto (including, without
limitation, the Partnership Agreement) constitute the entire agreement among the
parties with respect to the subject matter hereof and supersedes all prior
agreements, understandings and negotiations, both written and oral, between the
parties with respect to the subject matter hereof. No representation,
inducement, promise, understanding, condition or warranty not set forth herein
has been made or relied upon by any party hereto. Neither this Agreement nor any
provision hereof is intended to confer upon any Person other than the parties
any rights or remedies hereunder.

 

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Section 8.16 Severability. Any term or provision of this Agreement which is
invalid or unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdictions, it being intended that
all rights and obligations of the parties hereunder shall be enforceable to the
fullest extent permitted by law.

Section 8.17 Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be an original, with the same effect as if the
signature thereto and hereto were upon the same instrument. This Agreement shall
become effective when each party hereto shall have received a counterpart hereof
signed by the other parties hereto.

Section 8.18 Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF
OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

Section 8.19 Further Assurances. After the date hereof, each party hereto shall
take such other actions as the other parties may reasonably request to
consummate or implement the transactions contemplated hereby or to evidence such
events or matters.

 

36

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, the parties hereto have executed this Agreement or caused
this Agreement to be executed effective as of the date and year first above
written.

 

General Partner: ASC MANAGEMENT, INC.

By:

 

 

Name:

 

Title:

 

Address for Notices:

c/o ASLP Acquisition LLC

2025 First Avenue

Market Place Tower

Suite 900

Seattle, Washington 98121

Attention: Bernt O. Bodal

with a copy to:

Debevoise & Plimpton LLP

919 Third Avenue

New York, New York 10022

Attention: Jeffrey J. Rosen, Esq.

and

c/o Coastal Villages Pollock LLC

711 H Street

Suite 200

Anchorage, Alaska 99501

Attention: Morgen Crow

with a copy to:

Preston Gates & Ellis LLP

925 Fourth Avenue

Suite 2900

Seattle, Washington 98104

Attention: Richard B. Dodd, Esq.

Limited Partners: COASTAL VILLAGES POLLOCK LLC

By:

 

 

Name:

 

Title:

 

--------------------------------------------------------------------------------

Address for Notices: Coastal Villages Pollock LLC 711 H Street Suite 200
Anchorage, Alaska 99501 Attn: Mr. Morgen Crow, Executive Director with a copy
to: Preston Gates & Ellis LLP 925 Fourth Avenue Suite 2900 Seattle, Washington
98104 Attention: Richard B. Dodd, Esq.

--------------------------------------------------------------------------------

ASLP ACQUISITION LLC By:  

 

Name:   Title:   Address for Notices: ASLP Acquisition LLC 2025 First Avenue
Market Place Tower Suite 900 Seattle, Washington 98121 Attention: Bernt O. Bodal
with a copy to: Debevoise & Plimpton LLP 919 Third Avenue New York, New York
10022 Attention: Jeffrey J. Rosen, Esq.

--------------------------------------------------------------------------------

CP3 TAX-EXEMPT HOLDINGS CORP. By:  

 

Name:   Title:   Address for Notices:

Bernt O. Bodal

c/o American Seafoods, L.P.

Market Place Tower 2025 First Avenue Suite 900 Seattle, Washington 98121 with a
copy to: Debevoise & Plimpton LLP 919 Third Avenue New York, New York 10022

Attention: Jeffrey J. Rosen, Esq.

 

and

Coastal Villages Pollock LLC 711 H Street Suite 200 Anchorage, Alaska 99501
Attention: Morgen Crow with a copy to: Preston Gates & Ellis LLP 925 Fourth
Avenue Suite 2900 Seattle, Washington 98104 Attention: Richard B. Dodd, Esq.

--------------------------------------------------------------------------------

ASC OFFSHORE HOLDINGS CORP. By:  

 

Name:   Title:   Address for Notices: c/o Coastal Villages Pollock LLC 711 H
Street Suite 200 Anchorage, Alaska 99501 Attention: Morgen Crow with a copy to:
Preston Gates & Ellis LLP 925 Fourth Avenue Suite 2900 Seattle, Washington 98104
Attention: Richard B. Dodd, Esq.

--------------------------------------------------------------------------------

CENTRAL BERING SEA FISHERMEN’S
ASSOCIATION By:  

 

Name:   Title:   Address for Notices: P.O. Box 288 Saint Paul Island, Alaska
99660 Attention: Phillip Lestenkof and 44539 Sterling Highway Suite 205C
Soldotna, Alaska 99669 Attention: Jonathan Thorpe with a copy to: Davis Wright
Tremaine, LLP 1501 4th Avenue Suite 2600 Seattle, Washington 98101 Attention:
Joe Weinstein, Esq.

--------------------------------------------------------------------------------

BERNT O. BODAL

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121 with a copy to: Debevoise & Plimpton
LLP 919 Third Avenue New York, New York 10022 Attention: Jeffrey J. Rosen, Esq.

--------------------------------------------------------------------------------

JEFFREY W. DAVIS

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

MICHAEL J. HYDE

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

BRADLEY D. BODENMAN

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

INGE W. ANDREASSEN

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

DARIUSH KHALIGHI

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

MATTHEW D. LATIMER

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

WILLIAM R. STOKES

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

GLENN JUNYA SUMIDA

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

RASMUS SOERENSEN

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

ROGER MJELTEVIK

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

RICK THURMAN MUIR

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

GEORGE J. UYENO

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

HENRIK KRAGH

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

PER K. BRAUTASET

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

STEPHEN P. JOHNSTON

 

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

JENS EYSTEINSSON

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

LINDA I. STRONG

 

Address for Notices:

c/o American Seafoods, L.P.

Market Place Tower

2025 First Avenue

Suite 900

Seattle, Washington 98121

--------------------------------------------------------------------------------

RICHARD F. DRAVES

 

Address for Notices:

c/o American Seafoods, L.P.

Market Place Tower

2025 First Avenue

Suite 900

Seattle, Washington 98121

--------------------------------------------------------------------------------

AMY HUMPHREYS

 

Address for Notices:

c/o American Seafoods, L.P.

Market Place Tower

2025 First Avenue

Suite 900

Seattle, Washington 98121

--------------------------------------------------------------------------------

JOHN CUMMINGS

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

ROBERT MYATT

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

RANDY RHODES

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

TAMMY FRENCH

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

MARGARET MALKOSKI

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

KATE SILVA

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

ROBERT COLLINS

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

DONNIE WEDGEWORTH

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

TOM BASTONI

 

Address for Notices: c/o American Seafoods, L.P. Market Place Tower 2025 First
Avenue Suite 900 Seattle, Washington 98121

--------------------------------------------------------------------------------

SCHEDULE I

ADDITIONAL SECURITYHOLDERS

 

1. Central Bering Sea Fishermen’s Association

Address for Notices:

P.O. Box 288

Saint Paul Island, Alaska 99660

Facsimile: (907) 546-2450

 

2. Jeffrey W. Davis

Address for Notices:

c/o American Seafoods, L.P.

Market Place Tower

2025 First Avenue, Suite 900

Seattle, Washington 98121

Facsimile: (206) 374-1516

 

3. Michael J. Hyde

Address for Notices:

c/o American Seafoods, L.P.

Market Place Tower

2025 First Avenue, Suite 900

Seattle, Washington 98121

Facsimile: (206) 374-1516

 

Schedule I-1

--------------------------------------------------------------------------------

SCHEDULE II

INITIAL MANAGEMENT SECURITYHOLDERS

 

1.    Bernt O. Bodal    16.    Jens Eysteinsson 2.    William R. Stokes    17.
   Linda I. Strong 3.    Inge W. Andreassen    18.    Richard F. Draves 4.   
Bradley D. Bodenman    19.    Margaret Malkoski 5.    Matthew D. Latimer    20.
   Amy Humphreys 6.    Dariush Khalighi    21.    John Cummings 7.    Roger
Mjeltevik    22.    Robert Myatt 8.    Tammy French    23.    Rasmus Soerensen
9.    Rick Thurman Muir    24.    Randy Rhodes 10.    George J. Uyeno    25.   
Michael Luiz 11.    Henrik Kragh    26.    Kate Silva 12.    Per K. Brautaset   
27.    Robert Collins 13.    Frank A. Vargas    28.    Donnie Wedgeworth 14.   
Stephen P. Johnston    29.    Tom Bastoni 15.    Glenn J. Sumida      

Unless otherwise specified, the address for notices to be given to each of the
Initial Management Securityholders listed on this Schedule II shall be as
follows:

c/o American Seafoods, L.P.

Market Place Tower

2025 First Avenue, Suite 900

Seattle, Washington 98121

Facsimile: (206) 374-1516

 

Schedule II-1

--------------------------------------------------------------------------------

SCHEDULE III

REGISTRATION RIGHTS

The following registration rights provisions shall be applicable in any of the
circumstances in which they are referenced in Article V of the Securityholders
Agreement. In consequence, they may apply to or provide rights to a registration
of shares of PublicCo (i) by or for the account of a Securityholder who owns
shares of PublicCo, (ii) or for the account of a Securityholder who has the
right to receive shares of PublicCo on exchange of its Securities, (iii) by the
Partnership for the account of a Securityholder to whom shares of PublicCo held
by the Partnership are allocable and/or (iv) by PublicCo for the account of a
Securityholder to whom the shares of PublicCo to be sold are allocable. The
terms hereof are to be interpreted in a manner that provides consistent rights
to public liquidity whichever of the foregoing circumstances is applicable.
Accordingly, in appropriate circumstances direct or indirect references to
Registrable Securities “held” by a Securityholder shall be deemed to refer to
Registrable Securities allocable to such Securityholder.

Section 1. Definitions.

Section 1.1 Capitalized terms used herein without definition have the meanings
assigned to such terms in the Second Amended and Restated Securityholders
Agreement dated as of February 27, 2006 (the “Securityholders Agreement”) among
American Seafoods, L.P., a Delaware limited partnership, ASC Management, Inc., a
Delaware corporation, ASLP Acquisition LLC, a Delaware limited liability
company, Coastal Villages Pollock LLC, an Alaska limited liability company, the
entities and individuals listed on Schedules I and II annexed thereto, of which
this Schedule III is a part, and such other Securityholders that may from time
to time be party thereto. As used in this Schedule III, the following terms
shall have the following meanings:

“Demand Registration” has the meaning set forth in Section 2.1.

“Demand Request” has the meaning set forth in Section 2.1.

“Excess Amount” means the number of Registrable Securities requested by all
holders to be sold pursuant to Section 2.1 or Section 2.2 which the managing
Underwriter or Underwriters determines exceeds the largest number of Registrable
Securities which can successfully be sold in an orderly manner in such offering
within a price range reasonably acceptable to the Initiating Holders in the case
of a Demand Registration or to PublicCo in the case of a Piggyback Registration.

“Initial Public Offering” has the meaning set forth in Section 2.1.

“Initiating Holder” means (i) ASLP Acquisition until such time as they shall
have requested and there shall have been prosecuted to effectiveness at their
request four Demand Registrations, and (ii) Coastal until such time as it shall
have requested and there shall have been prosecuted to effectiveness at its
request three Demand Registrations.

“Prospectus” means any Prospectus included in a Registration Statement
(including, without limitation, a prospectus that includes any information
previously omitted from a prospectus filed as part of an effective Registration
Statement in reliance upon Rule 430A promulgated under the Securities Act), 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 any
Registration Statement, and all other amendments and supplements to the
Prospectus, including post-effective amendments, and all material incorporated
by reference in such Prospectus.

 

Schedule III-1

--------------------------------------------------------------------------------

“Piggy-Back Registration” has the meaning set forth in Section 2.2.

“PublicCo Common Stock” means shares of common stock of PublicCo.

“Registrable Securities” means any shares of PublicCo Common Stock (i) held by
Securityholders, (ii) which Securityholders have a current right to receive,
(iii) held by the Partnership for the account of Securityholders, or
(iv) issuable by PublicCo and allocable to the Partnership Units or other
Securities of Securityholders or; provided, however, that shares of PublicCo
Common Stock shall cease to be Registrable Securities upon any sale thereof
pursuant to an effective Registration Statement or under Rule 144, and provided,
further, that shares of PublicCo Common Stock described in clauses (i) or
(ii) above shall cease to be Registrable Securities at such time as those shares
become eligible for sale under Rule 144(k) or for so long as such shares may be
offered or sold pursuant to Rule 144 in any 90-day period.

“Registration Statement” means any Registration Statement and any additional
Registration Statement, including (in each case) the Prospectus, amendments and
supplements to such Registration Statement or Prospectus, including pre- and
post-effective amendments, all exhibits thereto, and all material incorporated
by reference in such Registration Statement to be filed pursuant to the terms of
this Schedule III.

“Rule 144” means Rule 144 promulgated by the SEC pursuant to the Securities Act,
as such Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC having substantially the same effect as such Rule.

“Rule 158” means Rule 158 promulgated by the SEC pursuant to the Securities Act,
as such Rule may be amended from time to time, or any, similar rule or
regulation hereafter adopted by the SEC having substantially the same effect as
such Rule.

“Rule 415” means Rule 415 promulgated by the SEC pursuant to the Securities Act,
as such Rule may be amended from time to time, or any similar rule or regulation
hereafter adopted by the SEC having substantially the same effect as such Rule.

“SEC” means the Securities and Exchange Commission or its successors.

“Securities Act” means the Securities Act of 1933, as amended, and any successor
federal statute, and the rules and regulations thereunder, all as the same shall
be in effect from time to time.

“Underwriter” means a securities dealer who purchases any Registrable Securities
as principal in an underwritten offering and not as part of such dealer’s
market-making activities.

“Underwritten Offering” means a registration in connection with which securities
of PublicCo are sold to an underwriter for reoffering to the public pursuant to
an effective Registration Statement.

 

Schedule III-2

--------------------------------------------------------------------------------

Section 2. Demand and Piggy-Back Registrations.

Section 2.1 Demand Registrations.

(a) At any time and from time to time on or after the date which is six months
following the closing of the first registered public offering of PublicCo (the
“Initial Public Offering”), an Initiating Holder may make a written request to
PublicCo (a “Demand Request”) for registration under the Securities Act of all
or part of the Registrable Securities held by such Initiating Holder and its
Affiliates and Permitted Transferees (a “Demand Registration”); provided that
the Registrable Securities requested to be registered, together with any
Registrable Securities requested to be registered pursuant to Section 2.2 of
this Schedule III, shall, on the date such request for a Demand Registration is
delivered, have an aggregate market value of $20,000,000 (before calculation of
underwriting discounts and commissions). Such request will specify the number of
shares of Registrable Securities proposed to be sold and will also specify the
intended method of disposition thereof.

(b) Within 10 days after receipt of each Demand Request, PublicCo shall give
written notice of such Demand Request to all Securityholders and each of
PublicCo and the Partnership (if applicable) shall use its reasonable best
efforts to cause a Registration Statement on Form S-3 under the Securities Act
(or any comparable or successor form permitting resale of securities on a
continuous or delayed basis pursuant to Rule 415), or, if PublicCo is ineligible
to use Form S-3, on another appropriate form, for the resale of such Registrable
Securities as may be requested by the Initiating Holder and its Affiliates and
any Persons exercising piggy-back rights under Section 2.2 to be filed with the
SEC not later than 60 days after receipt of a Demand Request. Each of PublicCo
and the Partnership (if applicable) shall use its reasonable best efforts to
cause any such Registration Statement to be declared effective by the SEC as
promptly as practicable after such filing.

(c) If the Initiating Holder so elects, the offering of such Registrable
Securities pursuant to such Demand Registration shall be in the form of an
Underwritten Offering. PublicCo shall select one or more nationally recognized
firms of investment bankers, reasonably acceptable to the Initiating Holder, to
act as the managing Underwriter or Underwriters in connection with such
Underwritten Offering.

Section 2.2 Piggy-Back Registrations. If at any time PublicCo shall determine to
register for its own account or the account of others under the Securities Act
(including without limitation in connection with (i) the Initial Public Offering
or (ii) a Demand Registration) any Registrable Securities (other than a
registration statement on Form S-4 or S-8 (or any substitute form that may be
adopted by the SEC)), then PublicCo shall give written notice of such proposed
filing to the Securityholders as soon as practicable (but in no event less than
30 days before the anticipated filing date), and such notice shall offer such
Securityholders the opportunity to register such number of shares of Registrable
Securities as each such Securityholder may request in writing within 15 days of
receipt of such notice (which request shall specify the Registrable Securities
intended to be disposed of by such Securityholder and the intended method of
distribution thereof) (a “Piggy-Back Registration”). PublicCo shall use
reasonable best efforts to cause the managing Underwriter or Underwriters of a
proposed underwritten offering to permit the Registrable Securities requested to
be included in a Piggy-Back Registration on the same terms and conditions as any
similar securities of PublicCo included therein to permit the sale or other
disposition of such Registrable Securities in accordance with the intended
method of distribution thereof. Subject to Section 2.3(b), any Securityholder
shall have the right to withdraw its request for inclusion of its Registrable
Securities in any Piggy-Back Registration by giving written notice to PublicCo
of its request to withdraw within 10 days of its request for inclusion. To the
extent the related registration statement was filed by PublicCo for its own
account, PublicCo may withdraw a Piggy-Back Registration at any time prior to
the time it becomes effective.

 

Schedule III-3

--------------------------------------------------------------------------------

Section 2.3 Reduction in Offering.

(a) Notwithstanding anything contained herein, if the managing Underwriter or
Underwriters of an offering described in Section 2.1 or Section 2.2 determine
that the size of the offering that PublicCo, Securityholders and/or other
Persons intend to make is such that the success of the offering would be
materially adversely affected by inclusion of the Registrable Securities
requested to be included, then (i) with respect to a Demand Registration,
PublicCo shall not include in such registration an amount of Registrable
Securities requested to be included in such offering by all holders (other than
the Initiating Holder and its Affiliates and Permitted Transferees) equal to the
Excess Amount (such reduction to be allocated first pro rata among holders other
than Securityholders, if any, and next pro rata among Securityholders seeking to
exercise their piggy-back rights, in each case according to the number of
Registrable Securities requested for inclusion) and (ii) with respect to a
Piggy-Back Registration (that does not also constitute a Demand Registration),
PublicCo shall not include in such registration an amount of Registrable
Securities requested to be included in such offering by all holders equal to the
Excess Amount (such reduction to be allocated pro rata among all holders seeking
to exercise their piggy-back rights according to the number of Registrable
Securities requested for inclusion).

(b) If, as a result of the proration provisions of Section 2.3(a), any
Securityholder shall not be entitled to include all Registrable Securities in a
Piggy-Back Registration that such Securityholder has requested to be included,
such Securityholder may elect to withdraw his request to include Registrable
Securities in such registration; provided, however, that such election shall be
irrevocable and, after making such election, a Securityholder shall no longer
have any right to include Registrable Securities in the registration as to which
such election to withdraw was made.

Section 3. Suspension of Obligations Under Certain Circumstances.

Notwithstanding anything to the contrary contained herein, PublicCo may, by
written notice to each Securityholder, suspend for up to 180 consecutive days
the filing of a Registration Statement or the right of a Securityholder to sell
Registrable Securities pursuant to an effective Registration Statement if the
board of directors of PublicCo or the Board determines in good faith that such
suspension is in the best interests of PublicCo or the Partnership; provided
that the number of days in all such periods of suspension pursuant to this
Section 3 in any consecutive twelve months shall not exceed 180 days in the
aggregate.

Section 4. Registration Procedures.

Whenever any holder has requested that any Registrable Securities be registered
pursuant to this Schedule III, PublicCo and, to the extent necessary or
desirable to fulfill the purposes of this Schedule III, the Partnership, if
applicable, shall use their respective reasonable best efforts to effect the
registration of such Registrable Securities and in furtherance thereof PublicCo
and, where so necessary or desirable, the Partnership shall:

(a) (i) prepare and file with the SEC such amendments, including post-effective
amendments and supplements to the Registration Statement as may be necessary to
keep the Registration Statement continuously effective as to the applicable
Registrable Securities until the holder or holders have completed the
distribution described in such Registration Statement; (ii) cause the related
Prospectus to be amended or supplemented by any required Prospectus supplement
(including, among other things, as a result of any change or changes after the
effective date of the Registration Statement in the plan of distribution
contemplated by the holders), and as so supplemented or amended to be filed
pursuant to Rule 424 promulgated under the Securities Act (or any similar
provisions then in force); (iii) respond as promptly as possible to any comments
received from the SEC with respect to each Registration Statement or any
amendment thereto and as promptly as possible provide the holders true and
complete copies of all correspondence from and to the SEC relating to the
Registration Statement; provided, however, that any information for which
PublicCo (or the Partnership, if applicable) requests confidential treatment
from the SEC shall be kept confidential by the holders, unless (A) disclosure of
such information is required by court or administrative order or is necessary to
respond to inquiries of regulatory authorities; (B) disclosure of such
information, in the opinion of counsel to such holders, is required by law;
(C) such information becomes generally available to the public other than as a
result of a disclosure or negligent failure to safeguard by such holders; or
(D) such information becomes available to such holders from a source other than
PublicCo and such source is not known by such holders to be bound by a
confidentiality agreement with PublicCo or the Partnership; and (iv) comply in
all material respects with the provisions of the Securities Act and the Exchange
Act with respect to the disposition of all Registrable Securities covered by
each Registration Statement in accordance with the intended methods of
disposition by the holders as set forth in the Registration Statement as so
amended or in such Prospectus as so supplemented;

 

Schedule III-4

--------------------------------------------------------------------------------

(b) (i) furnish to the holders of Registrable Securities to be sold, their
counsel and any managing underwriters, copies of all such documents proposed to
be filed, which documents (other than those incorporated by reference) will be
subject to the review of such holders, their counsel and such managing
underwriters, and (ii) cause its officers and directors, counsel and independent
certified public accountants to respond to such inquiries as shall be necessary,
in the reasonable opinion of respective counsel to such holders and such
underwriters, to conduct a reasonable due diligence investigation within the
meaning of the Securities Act;

(c) notify the holders of Registrable Securities to be sold, their counsel and
any managing underwriters as promptly as possible (and in the case of (i),
below, not less than five (5) Business Days prior to such filing and confirm
such notice in writing no later than one (1) Business Day following the day:

(i) when a Prospectus or any Prospectus supplement or post-effective amendment
to a Registration Statement is proposed to be filed;

(ii) when the SEC notifies PublicCo (or the Partnership, if applicable) whether
there will be a “review” of a Registration Statement and whenever the SEC
comments in writing on such Registration Statement;

(iii) with respect to each Registration Statement or any post-effective
amendment, when the same has become effective;

(iv) of any request by the SEC or any other Federal or state governmental
authority for amendments or supplements to each Registration Statement or
Prospectus or for additional information;

(v) of the issuance by the SEC of any stop order suspending the effectiveness of
each Registration Statement covering any or all of the Registrable Securities or
the initiation of any proceedings for that purpose;

(vi) if at any time any of the representations and warranties of PublicCo
contained in any agreement (including any underwriting agreement) contemplated
hereby in connection with the registration of Registrable Securities ceases to
be true and correct in all material respects;

 

Schedule III-5

--------------------------------------------------------------------------------

(vii) of the receipt by PublicCo (or the Partnership, if applicable) of any
notification with respect to the suspension of the qualification or exemption
from qualification of any of the Registrable Securities for sale in any
jurisdiction, or the initiation or threatening of any proceeding for such
purpose; and

(viii) of the occurrence of any event that makes any statement made in any
Registration Statement or Prospectus or any document incorporated or deemed to
be incorporated therein by deference untrue in any material respect or that
requires any revisions to such Registration Statement, Prospectus or other
documents so that, in the case of the Registration Statement or the Prospectus,
as the case may be, it will not contain any untrue statement of a material fact
or omit to state any material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading;

(d) use its best efforts to avoid the issuance of, or, if issued, obtain the
withdrawal of (i) any order suspending the effectiveness of the Registration
Statement or (ii) any suspension of the qualification (or exemption from
qualification) of any of the Registrable Securities for sale in any
jurisdiction, at the earliest practicable moment;

(e) if requested by any managing underwriter of Registrable Securities to be
sold in connection with an Underwritten Offering, (i) promptly incorporate in a
Prospectus supplement or post-effective amendment to the Registration Statement
such information as PublicCo (or the Partnership, if applicable) reasonably
agrees should be included therein and (ii) make all required filings of such
Prospectus supplement or such post-effective amendment as soon as practicable
after PublicCo (or the Partnership, if applicable) has received notification of
the matters to be incorporated in such Prospectus supplement or post-effective
amendment; provided, however, that neither PublicCo nor the Partnership (if
applicable) shall be required to take any action pursuant to this clause (e)
that would, in the opinion of counsel for PublicCo (or the Partnership, if
applicable), violate applicable law or not be required to be taken by applicable
securities laws and be detrimental to the business prospects of PublicCo (or the
Partnership, if applicable);

(f) furnish to each holder of Registrable Securities to be sold, their counsel
and any managing underwriters, without charge, at least one conformed copy of
each Registration Statement and each amendment thereto, including financial
statements and schedules, all documents incorporated or deemed to be
incorporated therein by reference, and all exhibits to the extent requested by
such Person (including those previously furnished or incorporated by reference)
promptly after the filing of such documents with the SEC;

(g) promptly deliver to each holder of Registrable Securities to be sold, their
counsel, and any underwriters, without charge, as many copies of the Prospectus
or Prospectuses (including each form of Prospectus) and each amendment or
supplement thereto as such Persons may reasonably request;

(h) use its best efforts to register or qualify or cooperate with the selling
holders, any underwriters and their counsel in connection with the registration
or qualification (or exemption from such registration or qualification) of such
Registrable Securities for offer and sale under the securities or Blue Sky laws
of such jurisdictions within the United States as any selling holder or
underwriter requests in writing, to keep each such registration or qualification
(or exemption therefrom) effective until the holder or holders have completed
the distribution of such Registrable Securities and to do any and all other acts
or things necessary or advisable to enable the disposition in such jurisdictions
of the Registrable Securities covered by a Registration Statement; provided,
however, that neither PublicCo nor the Partnership (if applicable) shall be
required to qualify generally to do business in any jurisdiction where it is not
then so qualified or to take any action that would subject it to general service
of process in any such jurisdiction where it is not then so subject or subject
PublicCo (or the Partnership, if applicable) to any material tax in any such
jurisdiction where it is not then so subject;

 

Schedule III-6

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(i) cooperate with the selling holders and any managing underwriters to
facilitate the timely preparation and delivery of certificates representing
Registrable Securities to be sold pursuant to a Registration Statement, which
certificates shall be free, to the extent permitted by applicable law, of all
restrictive legends, and to enable such Registrable Securities to be in such
denominations and registered in such names as any such managing underwriters or
selling holders may request at least two Business Days prior to any sale of
Registrable Securities pursuant to such Registration Statement;

(j) upon the occurrence of any event contemplated by Section 4(c)(viii) of this
Schedule III, as promptly as reasonably practicable, prepare a supplement or
amendment, including a post-effective amendment, to the Registration Statement
or a supplement to the related Prospectus or any document incorporated or deemed
to be incorporated therein by reference, and file any other document required to
be filed in connection therewith so that, as thereafter delivered, neither the
Registration Statement nor such Prospectus will contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading;

(k) use its best efforts to cause all Registrable Securities relating to each
Registration Statement to be listed on the securities exchange, quotation market
or over-the-counter bulletin board (i) in the case of the Initial Public
Offering, recommended by the managing Underwriters as that which would optimize
the liquidity and value of the PublicCo Common Stock or (ii) following
PublicCo’s Initial Public Offering, on which PublicCo Common Stock is then
listed;

(l) enter into such agreements (including an underwriting agreement in form,
scope and substance as is customary in Underwritten Offerings) and take all such
other actions in connection therewith (including those reasonably requested by
any managing underwriters in order to expedite or facilitate the disposition of
such Registrable Securities, and whether or not an underwriting agreement is
entered into) to:

(i) make such representations and warranties to such selling holders and such
underwriters as are customarily made by issuers to underwriters in underwritten
public offerings, and confirm the same if and when requested;

(ii) in the case of an Underwritten Offering, obtain and deliver copies thereof
to the managing underwriters, if any, of opinions of counsel to PublicCo (and
the Partnership, if applicable) and updates thereof addressed to each such
underwriter, in form, scope and substance reasonably satisfactory to any such
managing underwriters and counsel to the selling holders covering the matters
customarily covered in opinions requested in Underwritten Offerings and such
other matters as may be reasonably requested by such counsel and underwriters;

(iii) immediately prior to the effectiveness of each Registration Statement,
and, in the case of an Underwritten Offering, at the time of delivery of any
Registrable Securities sold pursuant thereto, obtain and deliver copies to the
selling holders and the managing underwriters, if any, of “cold comfort” letters
and updates thereof from the independent certified public accountants of
PublicCo (and the Partnership, if applicable) (and, if necessary, any other
independent certified public accountants of any Affiliate of PublicCo or the
Partnership or of any business acquired by PublicCo or the Partnership for which
financial statements and financial data is, or is required to be, included in
any such Registration Statement), addressed to each selling holder and each of
the underwriters, if any, in form and substance as are customary in connection
with Underwritten Offerings;

 

Schedule III-7

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(iv) if an underwriting agreement is entered into, the same shall contain
indemnification provisions and procedures no less favorable to the selling
holders and the underwriters, if any, than those set forth in Section 7 of this
Schedule III (or such other provisions and procedures acceptable to the managing
underwriters, if any); and

(v) deliver such documents and certificates as may be reasonably requested by
the selling holders, their counsel and any managing underwriters to evidence the
continued validity of the representations and warranties made pursuant to
clause (i) above and to evidence compliance with any customary conditions
contained in the underwriting agreement or other agreement entered into by
PublicCo;

(m) comply in all material respects with all applicable rules and regulations of
the SEC and make generally available to its security holders an earnings
statement covering a period of twelve months beginning within three months after
the effective date of the Registration Statement, which earnings statement shall
satisfy the provisions of Section 11(a) of the Securities Act and Rule 158
thereunder;

(n) make available executive officers of PublicCo for participation in a
reasonable number of “road show” and other investor presentations requested by
the holders selling Registrable Securities in an Underwritten Offering; and

(o) make available for inspection by the selling holders, any representative of
such holders, any underwriter participating in any disposition of Registrable
Securities, and any attorney or accountant retained by such selling holder or
underwriters, at the offices where normally kept, during reasonable business
hours, all financial and other records, pertinent corporate documents and
properties of PublicCo (and the Partnership, if applicable) and their respective
subsidiaries, and cause the officers, directors, agents and employees of
PublicCo (and the Partnership, if applicable) and their respective subsidiaries
to supply all information in each case reasonably requested by any such holder,
representative, underwriter, attorney or accountant in connection with each
Registration Statement; provided, however, that any information that is
determined in good faith by PublicCo (or the Partnership, if applicable) in
writing to be of a confidential nature at the time of delivery of such
information shall be kept confidential by such Persons, unless (i) disclosure of
such information is required by court or administrative order or is necessary to
respond to inquiries of regulatory authorities; (ii) disclosure of such
information, in the opinion of counsel to such Person, is required by law;
(iii) such information becomes generally available to the public other than as a
result of a disclosure or negligent failure to safeguard by such Person; or
(iv) such information becomes available to such Person from a source other than
PublicCo (or the Partnership, if applicable) and such source is not known by
such Person to be bound by a confidentiality agreement with PublicCo (or the
Partnership, if applicable).

Section 5. Stockholder Covenants.

Each Securityholder hereby covenants and agrees that:

(a) it will not sell any Registrable Securities under any Registration Statement
until it has received notice from PublicCo, that such Registration Statement and
any post-effective amendments thereto have become effective;

 

Schedule III-8

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(b) it and its officers, directors and Affiliates, if any, will comply with the
prospectus delivery requirements of the Securities Act as applicable to them in
connection with sales of Registrable Securities pursuant to a Registration
Statement;

(c) by its acquisition of such Registrable Securities that, upon receipt of a
notice from PublicCo of the occurrence of any event of the kind described in
Section 4(c)(iv), (v), (vi), (vii) and (viii) of this Schedule III, such holder
will forthwith discontinue disposition of such Registrable Securities under the
Registration Statement until such holder’s receipt of the copies of the
supplemented Prospectus and/or amended Registration Statement or until the
holder is advised in writing by PublicCo that the use of the applicable
Prospectus may be resumed;

(d) if an underwriting agreement is entered into, the same shall contain
indemnification provisions no less favorable to PublicCo and the underwriters,
if any, than those set forth in Section 7.2 of this Schedule III;

(e) PublicCo may require each selling holder to furnish to PublicCo information
regarding such holder and the distribution of such Registrable Securities as is
required by law to be disclosed in each Registration Statement, and PublicCo may
exclude form such registration the Registrable Securities of any such holder who
unreasonably fails to furnish such information within a reasonable time after
receiving such request. If the Registration Statement refers to any holder by
name or otherwise as the holder of any securities of PublicCo, then such holder
shall have the right to require (if such reference to such holder by name or
otherwise is not required by the Securities Act or any, similar federal statute
then in force) the deletion of the reference to such holder in any amendment or
supplement to each Registration Statement filed or prepared subsequent to the
time that such reference ceases to be required; and

(f) it will not effect any sale or distribution of Registrable Securities,
including a sale pursuant to Rule 144 or Rule 144A under the Securities Act,
during the 14 days prior to, and during the 180-day period beginning on, the
effective date of the registration statement filed by PublicCo (except as part
of such registration) if, and to the extent, requested by the managing
Underwriter or Underwriters in the case of an underwritten public offering.

Section 6. Registration Expenses.

All fees and expenses of PublicCo, the Partnership and any holder incident to
the performance of or compliance with this Schedule III shall be borne by
PublicCo whether or not pursuant to an Underwritten Offering and whether or not
any Registration Statement is filed or becomes effective and whether or not any
Registrable Securities are sold pursuant to any Registration Statement. The fees
and expenses referred to in the foregoing sentence shall include, without
limitation (i) all registration and filing fees (including, without limitation,
fees and expenses (A) with respect to filings required to be made with any,
securities exchange or market on which Registrable Securities are required
hereunder to be listed and (B) in compliance with state securities or Blue Sky
laws, including, without limitation, fees and disbursements of counsel for the
selling holders in connection with Blue Sky qualifications of the Registrable
Securities and determination of the eligibility of the Registrable Securities
for investment under the laws of such jurisdictions as the managing underwriters
shall request, if any); (ii) printing expenses, including, without limitation,
expenses of printing certificates for Registrable Securities and of printing
prospectuses if the printing of prospectuses is requested by the managing
underwriters, if any; (iii) messenger, telephone and delivery expenses,
(iv) fees and disbursements of counsel for PublicCo (and the Partnership, if
applicable); (v) Securities Act liability insurance, if PublicCo (and the
Partnership, if applicable) so desire such insurance; (vi) fees and expenses of
all other Persons retained by PublicCo in connection with the consummation of
the transactions contemplated by this Schedule III; and (vii) all internal
expenses of PublicCo (and the Partnership, if applicable) incurred in connection
with the consummation of the transactions contemplated by this Schedule III,
including, without limitation, all salaries and expenses of its officers and
employees performing legal or accounting duties, the expense of any annual
audit, the fees and expenses incurred in connection with the listing of the
Registrable Securities on any securities exchange as required hereunder (all
such expenses being referred to herein as “Registration Expenses”); provided,
however, in no event shall Registration Expenses include any underwriting
discounts, commissions, or fees attributable to the sale of the Registrable
Securities or any counsel, accountants or other persons retained by the holders
in connection with the consummation of the transactions contemplated by this
Schedule III.

 

Schedule III-9

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Section 7. Indemnification and Contribution.

Section 7.1 Indemnification by PublicCo. PublicCo (and the Partnership, if
applicable, in which case the indemnification set forth herein shall be on a
joint and several basis) agrees to indemnify to the fullest extent permitted by
law, each holder, each person who controls any such holder, (within the meaning
of either the Securities Act or the Exchange Act), and their respective
directors and officers against any and all losses, claims, damages, liabilities
(or actions or proceedings in respect thereof) and expenses (including
reasonable attorneys’ fees) caused by any untrue or alleged untrue statement of
material fact contained in any Registration Statement, prospectus or preliminary
prospectus (each as amended and/or supplemented, if PublicCo (or the
Partnership, if applicable) shall have furnished any amendments or supplements
thereto), or any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein (in
the case of a Prospectus, in the light of the circumstances under which they
were made) not misleading; provided that neither PublicCo nor the Partnership
(if applicable) shall be required to indemnify such holder, such controlling
persons or their respective officers or directors for any losses, claims,
damages, liabilities (or actions or proceedings in respect thereof) or expenses
resulting from any such untrue statement or omission if such untrue statement or
omission is made in reliance on and conformity with any information with respect
to such holder or the underwriters furnished in writing to PublicCo (or the
Partnership, if applicable) by such holder expressly for use therein; provided,
further, that neither PublicCo nor the Partnership (if applicable) shall be
required to indemnify any holder to the extent that any such loss, claim,
damage, liability (or actions or proceedings in respect thereof) or expense
arises out of or is based upon an untrue or alleged untrue statement or omission
or alleged omission made in any preliminary Prospectus if (i) in the case of any
offering, other than an Underwriting Offering, having previously been furnished
by or on behalf of PublicCo (or the Partnership, if applicable) with copies of
the final Prospectus, such holder failed to send or deliver a copy of the final
Prospectus with or prior to the delivery of written confirmation of the sale of
the Registrable Securities by the holder to the person asserting the claim from
which such loss, claim, damage, liability (or actions or proceedings in respect
thereof) or expense arises and (ii) the final Prospectus would have corrected in
all material respects such untrue statement or alleged untrue statement or
omission or alleged omission; and provided, further, that neither PublicCo nor
the Partnership (if applicable) shall be required to indemnify any holder to the
extent that any such loss, claim, damage, liability (or actions or proceedings
in respect thereof) or expense arises out of or is based upon an untrue
statement or alleged untrue statement, omission or alleged omission in the
Prospectus if (x) such untrue statement or alleged untrue statement, omission or
alleged omission is corrected in all material respects in an amendment or
supplement to the Prospectus and (y) in the case of any offering other than an
Underwritten Offering, having previously been furnished by or on behalf of
PublicCo (or the Partnership, if applicable) with copies of the Prospectus as so
amended or supplemented, such holder thereafter fails to deliver such Prospectus
as so amended or supplemented, prior to or concurrently with the sale of
Registrable Securities. In connection with an Underwritten Offering, PublicCo
(and the Partnership, if applicable, in which case the indemnification set forth
herein shall be on a joint and several basis) agrees to indemnify, each
underwriter thereof, the officers and directors of such underwriter, and each
person who controls such underwriter (within the meaning of either the
Securities Act or Exchange Act) to the same extent as provided above with
respect to the indemnification of holders; provided that such underwriter agrees
to indemnify PublicCo (and the Partnership, if applicable) to the same extent as
provided below with respect to the indemnification of PublicCo (and the
Partnership, if applicable) by such holders.

 

Schedule III-10

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Section 7.2 Indemnification by Holders. In connection with any registration in
which any holder is participating, such holder will furnish to PublicCo in
writing such information with respect to it and its Affiliates as PublicCo
reasonably requests for use in connection with any such registration,
Prospectus, or preliminary Prospectus and agrees to indemnify each of PublicCo
(and the Partnership, if applicable), their respective directors and officers
who sign the Registration Statement, each person, if any, who controls (within
the meaning of either the Securities Act or of the Exchange Act) PublicCo (and
the Partnership, if applicable), each other holder and any prospective
underwriters, as the case may be, and any of their respective affiliates,
general partners, officers, employees, agents and controlling persons, to the
same extent as the foregoing indemnity from PublicCo to such holder, but only
with respect to information relating to such holder furnished to PublicCo (or
the Partnership, if applicable) in writing by such holder expressly for use in
the Registration Statement, the Prospectus, any amendment or supplement thereto,
or any preliminary Prospectus.

Section 7.3 Conduct of Indemnification Proceedings. In case any proceeding
(including any governmental investigation) shall be instituted involving any
person in respect of which indemnity may be sought pursuant to Section 7.1 or
Section 7.2 of this Schedule III, such person (hereinafter called the
“indemnified party”) shall promptly notify the person against whom such
indemnity may be sought (hereinafter called the “indemnifying party”) in writing
and the indemnifying party, upon request of the indemnified party, shall retain
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party and any others the indemnifying party may designate in such
proceeding and shall pay the fees and disbursements of such counsel related to
such proceeding. In any such proceeding, any indemnified party shall have the
right to retain its own counsel, but the fees and expenses of such counsel shall
be at the expense of such indemnified party unless (i) the indemnifying party
and the indemnified party shall have mutually agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both the indemnifying party and the indemnified party
and the indemnified party shall have been advised by counsel that representation
of both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. It is understood that the
indemnifying party shall not, in connection with any proceeding or related
proceedings in the same jurisdiction, be liable for the fees and expenses of
more than one separate firm (in addition to any local counsel) for all such
indemnified parties, and that all such fees and expenses shall be reimbursed as
they are incurred. In the case of any such separate firm for the indemnified
parties, such firm shall be designated in writing by all of the indemnified
parties. The indemnifying party shall not be liable for any settlement of any
proceeding effected without its written consent (which consent will not be
unreasonably withheld), but if settled with such consent or if there be a final
judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at any time
an indemnified party shall have requested an indemnifying party to reimburse the
indemnified party for fees and expenses of counsel as contemplated by the third
sentence of this Section 7.3, the indemnifying party agrees that the
indemnifying party shall be liable for any settlement of any proceeding effected
without the indemnifying party’s written consent if (i) such settlement is
entered into more than 30 days after receipt by such indemnifying party of the
aforesaid request and (ii) such indemnifying party shall not either have
reimbursed the indemnified party in accordance with such request or reasonably
objected in writing, on the basis of the standards set forth herein, to the
propriety of such reimbursement prior to the date of such settlement. No
indemnifying party shall, without the prior written consent of the indemnified
party, effect any, settlement of any pending or threatened proceeding in respect
of which any indemnified party is or could have been a party and indemnity could
have been sought hereunder by such indemnified party, unless such settlement
includes as an unconditional term thereof a release of such indemnified party,
from all liability on claims that are the subject matter of such proceeding.

 

Schedule III-11

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Section 7.4 Contribution. If the indemnification provided for in this Section 7
from the indemnifying party is unavailable to an indemnified party hereunder in
respect of any losses, claims, damages, liabilities or expenses referred to in
this Section 7, then the indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages, liabilities or
expenses in such proportion as is appropriate to reflect the relative fault of
the indemnifying party and indemnified parties in connection with the actions
which resulted in such losses, claims, damages, liabilities or expenses, as well
as any other relevant equitable considerations. The relative fault of such
indemnifying party and indemnified parties shall be determined by reference to,
among other things, whether any action in question, including any untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact, has been made by, or relates to information supplied by,
such indemnifying party or indemnified parties, and the parties’ relative
intent, knowledge, access to information and opportunity to correct or prevent
such action. The amount paid or payable by a party as a result of the loses,
claims, damages, liabilities and expenses referred to above shall be deemed to
include, subject to the limitations set forth in Section 7.3 of this Schedule
III, any legal or other fees or expenses reasonably incurred by such party in
connection with any investigation or proceeding.

The parties hereto agree that it would not be just and equitable if contribution
pursuant to this Section 7.4 were determined by pro rata allocation or by any
other method of allocation which does not take into account the equitable
considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 7.4, no holder shall be required
to contribute any amount in excess of the amount of the total net proceeds
received by such holder from sales of the Registrable Securities sold by such
holder pursuant to the offering that gave rise to such losses, claims, damages,
liabilities or expenses. 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.

If indemnification is available under this Section 7, the indemnifying parties
shall indemnify each indemnified party to the full extent provided in Sections
7.1 and 7.2 of this Schedule III without regard to the relative fault of said
indemnifying party, or indemnified party or any other equitable consideration
provided for in this Section 7.4.

 

Schedule III-12

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SCHEDULE IV

ACQUISITION LLC MEMBERS

 

1. Bernt O. Bodal

 

2. Jeffrey Warren Davis

 

3. Michael Joseph Hyde

 

4. Bradley D. Bodenman

 

5. Matthew D. Latimer

 

6. Inge W. Andreassen

 

7. Dariush Khalighi

 

8. William R. Stokes

 

9. Glenn Junya Sumida

 

10. Roger Mjeltevik

 

12. Rick Thurman Muir

 

13. George Joyi Uyeno

 

14. Henrik Kragh

 

15. Per K. Brautaset

 

16. Stephen P. Johnston

 

17. Frank Abel Vargas

 

18. Linda I. Strong

 

19. Richard F. Draves

 

20. Jens Eysteinsson

 

21. Central Bering Sea Fishermen’s Association

 

Schedule IV-1

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EXHIBIT A

BOARD OF DIRECTORS AND COMMITTEES

Board of Directors

 

     Term Expires      2007    2008    2009

Coastal Independent Director

      Scott Perekslis   

Acquisition Independent Director

   Ren Jurgensen      

Acquisition Independent Director

         William Bittner

Coastal Affiliated Director

      Robert Williams   

Coastal Affiliated Director

         Morgen Crow

Management Affiliated Director

   Bernt O. Bodal      

Management Affiliated Director

         Jeff Davis

Audit Committee

Ren Jurgensen, Chair

Robert Williams

William Bittner

Compensation Committee

Scott Perekslis, Chair

Morgen Crow

Bernt O. Bodal, Ex Officio, non-voting

Finance Committee

Bernt O. Bodal

Scott Perekslis

Robert Williams

 

Exhibit A-1