Exhibit 10.8
AMENDMENT NO. 1 TO RIGHTS AGREEMENT
     AMENDMENT NO. 1 TO RIGHTS AGREEMENT (this “Amendment”) dated as of
November 9, 2005 by and between Kitty Hawk, Inc., a Delaware corporation (the
“Company”), and American Stock Transfer & Trust Company (the “Rights Agent”).
     WHEREAS, the Company and the Rights Agent have previously entered into that
certain Rights Agreement dated as of January 21, 2004 (the “Rights Agreement”);
and
     WHEREAS, Section 27 of the Rights Agreement provides that, for so long as
the Rights (as defined in the Rights Agreement) are redeemable, the Company may
from time to time supplement or amend any provision of the Rights Agreement as
the Company may deem necessary or desirable without the approval of any holders
of certificates representing shares of Common Stock (as defined in the Rights
Agreement); and
     WHEREAS, the Rights are currently redeemable; and
     WHEREAS, the Board of Directors has determined in good faith that the
amendment to the Rights Agreement set forth herein is desirable and, pursuant to
the terms of the Rights Agreement, has duly authorized such amendment to the
Rights Agreement;
     NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:
     1. Amendment to the Definition of “Acquiring Person”. The definition of
“Acquiring Person” set forth in Section 1(a) of the Rights Agreement is hereby
amended and restated in its entirety as follows:
     (a) “Acquiring Person” shall mean any Person (as such term is hereinafter
defined) who or which, together with all Affiliates and Associates of such
Person, shall be the Beneficial Owner (as such term is hereinafter defined) of
15% or more of the shares of Common Stock then outstanding, but shall not
include (i) the Company, (ii) any Subsidiary of the Company, (iii) any employee
benefit plan of the Company or of any Subsidiary of the Company, or any Person
or entity organized, appointed or established by the Company for or pursuant to
the terms of any such plan, (iv) any Person who becomes an Acquiring Person
solely as a result of a reduction in the number of shares of Common Stock
outstanding due to the repurchase of shares of Common Stock by the Company,
unless and until such Person shall purchase or otherwise become (as a result of
actions taken by such Person or its Affiliates or Associates) the Beneficial
Owner of additional shares of Common Stock constituting 1% or more of the then
outstanding shares of Common Stock, or (v) an Exempted Person (as such term is
hereinafter defined). Notwithstanding the foregoing, if (i) the Board of
Directors of the Company determines in good faith that a Person who would
otherwise be an Acquiring Person, as defined pursuant to the foregoing
provisions of this paragraph, has become such inadvertently (including, without
limitation, because (A) such Person was unaware that it beneficially owned a
percentage of Common Stock that would otherwise cause such Person to be an
Acquiring Person, or (B) such Person was aware of the extent of its Beneficial
Ownership of Common Stock but had no actual knowledge of the consequences of
such Beneficial Ownership under this Agreement) and without any intention of
changing or influencing control of the Company, and (ii) within ten Business
Days of being requested by the Company to advise it regarding the same, such
Person certifies to the Company that such Person acquired shares of Common Stock
in excess of 14.99%

 

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inadvertently or without knowledge of the terms of the Rights and who, together
with all Affiliates and Associates, thereafter does not acquire additional
shares of Common Stock and within ten Business Days of being requested by the
Company to do so disposes of the portion of such shares of Common Stock in
excess of 14.99%, then such Person shall not be deemed to be or to have become
an Acquiring Person for any purposes of this Agreement; provided, however, that
if the Person requested to so certify fails to do so within ten Business Days of
the Company’s request or such Person fails to dispose of such shares of Common
Stock in excess of 14.99% within ten Business Days of the Company’s request,
then such Person shall become an Acquiring Person immediately after such ten
Business Day period. The phrase “then outstanding,” when used with reference to
a Person’s Beneficial Ownership of securities of the Company, shall mean the
number of such securities then issued and outstanding together with the number
of such securities not then actually issued and outstanding which such Person
would be deemed to own beneficially hereunder.
     2. Amendment to the Definition of “Beneficial Owner”. The definition of
“Beneficial Owner” set forth in Section 1(f) of the Rights Agreement is hereby
amended and restated in its entirety as follows:
     (f) A Person shall be deemed the “Beneficial Owner” of, and shall be deemed
to “beneficially own,” any securities:
          (i) which such Person or any of such Person’s Affiliates or
Associates, directly or indirectly, has the right to acquire (whether such right
is exercisable immediately or only after the passage of time) pursuant to any
agreement, arrangement or understanding (whether or not in writing) or upon the
exercise of conversion rights, exchange rights, rights, warrants or options, or
otherwise; provided, however, that a Person shall not, for purposes of this
paragraph (i), be deemed the “Beneficial Owner” of or to “beneficially own,”
(A) securities tendered pursuant to a tender or exchange offer made by such
Person or any of such Person’s Affiliates or Associates until such tendered
securities are accepted for purchase or exchange, or (B) securities issuable
upon exercise of Rights at any time prior to the occurrence of a Triggering
Event, or (C) securities issuable upon exercise of Rights from and after the
occurrence of a Triggering Event, which Rights were acquired by such Person or
any of such Person’s Affiliates or Associates prior to the Distribution Date or
pursuant to Section 3(a) (Issuance of Rights Certificates — Distribution Date;
Rights Certificates) or Section 22 (Issuance of New Rights Certificates) (the
“Original Rights”) or pursuant to Section 11(i) (Adjustment of Purchase Price;
Number and Kind of Shares or Number of Rights — Adjustment of Number of Rights)
in connection with an adjustment made with respect to any Original Rights;
          (ii) which such Person or any of such Person’s Affiliates or
Associates, directly or indirectly, has the right to vote or dispose of or has
“beneficial ownership” of (as determined pursuant to Rule 13d-3 of the General
Rules and Regulations under the Exchange Act), including pursuant to any
agreement, arrangement or understanding, whether or not in writing; provided,
however, that a Person shall not be deemed the “Beneficial Owner” of, or to
“beneficially own,” any security under this subparagraph (ii) as a result of an
agreement, arrangement or understanding to vote such security if such agreement,
arrangement or understanding: (A) arises solely from a revocable proxy given in
response to a public proxy or consent solicitation made pursuant to, and in
accordance with, the applicable provisions of the General Rules and Regulations
under the Exchange Act, and (B) is not also then reportable by such Person on a
Schedule 13D under the Exchange Act (or any comparable or successor report); or

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          (iii) which are “beneficially owned,” directly or indirectly, by any
other Person (or any Affiliate or Associate thereof) with which such Person (or
any of such Person’s Affiliates or Associates) has any agreement, arrangement or
understanding (whether or not in writing), for the purpose of acquiring,
holding, voting (except pursuant to a revocable proxy as described in the
proviso to subparagraph (ii) of this paragraph (f)) or disposing of any voting
securities of the Company;
provided, however, that nothing in this paragraph (f) shall cause a Person
engaged in business as an underwriter of securities to be the “Beneficial Owner”
of or to “beneficially own,” any securities acquired through such Person’s
participation in good faith in a firm commitment underwriting until the
expiration of forty (40) calendar days after the date of such acquisition.
     3. Amendment to the Definition of “Exempted Person”. The definition of
“Exempted Person” set forth in Section 1(t) of the Rights Agreement is hereby
amended and restated in its entirety as follows:
     (t) “Exempted Person” shall mean Miller, unless and until the earlier of
such time as (i) Miller, directly or indirectly, and together with its
Affiliates and Associates, becomes the Beneficial Owner of 23.50% or more of the
shares of Common Stock then outstanding (other than under circumstances
described in Section 1(a)(iv) and in the second sentence of Section 1(a)
(replacing for purposes of this clause (i) all references in Section 1(a) to
14.99% with 23.49%)), (ii) Miller, directly or indirectly, and together with its
Affiliates and Associates, becomes the Beneficial Owner of less than 15% of the
shares of Common Stock then outstanding, or (iii) Miller breaches the terms of
the Standstill Agreement. Upon the occurrence of (i), (ii) or (iii) above,
Miller immediately shall cease to be an Exempted Person.
     4. Deletion of Definitions. Section 1 of the Rights Agreement shall be
amended as follows:
     (a) Section 1(q) of the Rights Agreement shall be amended and restated in
its entirety as follows:
     “(q) [INTENTIONALLY DELETED]”
     (b) Section 1(z) of the Rights Agreement shall be amended and restated in
its entirety as follows:
     “(z) [INTENTIONALLY DELETED]”
     (c) Section 1(ii) of the Rights Agreement shall be amended and restated in
its entirety as follows:
     “(ii) [INTENTIONALLY DELETED]”
     (d) Section 1(pp) of the Rights Agreement shall be amended and restated in
its entirety as follows:
     “(pp) [INTENTIONALLY DELETED]”

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     5. Additional Definitions. Section 1 of the Rights Agreement shall be
amended to include the following definitions:
     (uu) “Miller” shall mean collectively, Lloyd I. Miller, III and any of his
Affiliates and Associates.
     (vv) “Standstill Agreement” shall mean that certain Standstill Agreement,
dated as of November 10, 2005, by and among the Company, Miller, and the other
parties thereto.
     6. Amendment to Section 3(a). Section 3(a) of the Rights Agreement is
hereby amended and restated in its entirety as follows:
     (a) Distribution Date; Rights Certificates. Until the earlier of (i) the
Close of Business on the tenth Business Day after the Stock Acquisition Date
(or, if the tenth Business Day after the Stock Acquisition Date occurs before
the Record Date, the Close of Business on the Record Date), or (ii) the Close of
Business on the tenth Business Day (or such later date as the Board shall
determine prior to such time as any Person becomes an Acquiring Person) after
the date that a tender or exchange offer by any Person (other than the Company,
any Subsidiary of the Company, any employee benefit plan of the Company or of
any Subsidiary of the Company, or any Person or entity organized, appointed or
established by the Company for or pursuant to the terms of any such plan) is
first published or sent or given within the meaning of Rule 14d-2(a) of the
General Rules and Regulations under the Exchange Act, if upon consummation
thereof such Person would be the Beneficial Owner of 15% (or, in the case of
Miller, 23.50%, for so long as Miller is an Exempted Person) or more of the
shares of Common Stock then outstanding (the earlier of (i) and (ii) being
herein referred to as the “Distribution Date”), (x) the Rights will be evidenced
(subject to the provisions of paragraph (b) of this Section 3) by the
certificates for the Common Stock registered in the names of the holders of the
Common Stock (which certificates for Common Stock shall be deemed also to be
certificates for Rights) and not by separate certificates, and (y) the Rights
will be transferable only in connection with the transfer of the underlying
shares of Common Stock (including a transfer to the Company, except pursuant to
the provision of Section 23 (Redemption and Termination)). As soon as
practicable after the Distribution Date, the Rights Agent will send by
first-class, insured, postage prepaid mail, to each record holder of the Common
Stock as of the Close of Business on the Distribution Date, at the address of
such holder shown on the records of the Company, one or more rights
certificates, in substantially the form of Exhibit 2 hereto (the “Rights
Certificates”), evidencing one Right for each share of Common Stock so held,
subject to adjustment as provided herein. In the event that an adjustment in the
number of Rights per share of Common Stock has been made pursuant to Section
11(p) (Adjustment of Purchase Price; Number and Kind of Shares or Number of
Rights — Common Stock Adjustments) at the time of distribution of the Rights
Certificates, the Company shall make the necessary and appropriate rounding
adjustments (in accordance with Section 14(a) (Fractional Rights and Fractional
Shares — Fractional Rights)) so that Rights Certificates representing only whole
numbers of Rights are distributed and cash is paid in lieu of any fractional
Rights. As of and after the Distribution Date, the Rights will be evidenced
solely by such Rights Certificates.
     7. Amendment to Section 27. Section 27 of the Rights Agreement is hereby
amended and restated in its entirety as follows:
     Section 27. Supplements and Amendments. For so long as the Rights are
redeemable, and subject to the penultimate sentence of this Section 27, the
Company may, and the Rights Agent shall, if the Company so directs, supplement
or amend any provision of this Agreement without the approval of any holders of
certificates representing shares of Common Stock or, on and after the
Distribution Date, the

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holders of Rights Certificates. At any time when the Rights are no longer
redeemable and subject to the penultimate sentence of this Section 27, the
Company and the Rights Agent shall, if the Company so directs, supplement or
amend this Agreement without the approval of any holders of Rights Certificates;
provided, however, that no such supplement or amendment may (i) adversely affect
the interests of the holders of Rights Certificates (other than an Acquiring
Person or an Affiliate or Associate of any such Person) or, prior to the
Distribution Date, holders of certificates representing shares of Common Stock;
(ii) cause this Agreement again to become amendable other than in accordance
with this sentence; or (iii) cause the Rights again to become redeemable. Upon
the delivery of a certificate from an appropriate officer of the Company which
states that the proposed supplement or amendment is in compliance with the terms
of this Section 27, the Rights Agent shall execute such supplement or amendment.
Notwithstanding anything contained in this Agreement to the contrary, no
supplement or amendment shall be made which changes the Redemption Price, the
Final Expiration Date, the Purchase Price, or the number of one one-thousandths
of a share of Preferred Stock for which a right is exercisable; provided,
however, that at any time prior to (i) a Stock Acquisition Date or (ii) the date
that a tender or exchange offer by any Person (other than the Company, any
Subsidiary of the Company, any employee benefit plan of the Company or any
Subsidiary of the Company, or any Person or entity organized, appointed or
established by the Company for or pursuant to the terms of any such plan) is
first published or sent or given within the meaning of Rule 14d-2(a) of the
General Rules and Regulations under the Exchange Act, if upon consummation
thereof, such Person would be the Beneficial Owner of 15% (or, in the case of
Miller, 23.50%, for so long as Miller is an Exempted Person) or more of the
shares of Common Stock then outstanding the Board may amend this Agreement to
increase the Purchase Price or extend the Final Expiration Date. Prior to the
Distribution Date, the interests of the holders of Rights shall be deemed
coincident with the interests of the holders of Common Stock.
     8. Effectiveness. This Amendment shall be effective as of November 9, 2005,
as if executed by both parties on such date. Except as expressly amended by this
Amendment, the Rights Agreement shall remain in full force and effect, and all
references to the Rights Agreement from and after such time shall be deemed to
be references to the Rights Agreement as amended hereby.
     9. Governing Law. This Amendment shall be deemed to be a contract made
under the laws of the State of Delaware and for all purposes shall be governed
by and construed in accordance with the laws of such state applicable to
contracts made and to be performed entirely within such state.
     10. Counterparts. This Amendment may be executed in any number of
counterparts and each of such counterparts shall for all purposes be deemed to
be an original, and all such counterparts shall together constitute but one and
the same instrument.
     11. Severability. If any term, provision, covenant or restriction of this
Amendment is held by a court of competent jurisdiction or other authority to be
invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Amendment shall remain in full force and
effect and shall in no way be affected, impaired or invalidated.
     12. Descriptive Headings. Descriptive headings of the several Sections of
this Amendment are inserted for convenience only and shall not control or affect
the meaning or construction of any of the provisions of this Amendment.
     13. Exhibits. Exhibit 2 to the Rights Agreement shall be deemed amended in
a manner consistent with this Amendment.
* * * * *

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     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed as of the day and year first above written.

                KITTY HAWK, INC.    
 
  By:   /s/ Robert W. Zoller, Jr.  
 
              Name: Robert W. Zoller, Jr.
Title: President and Chief Executive Officer  
 
         

          AGREED AND ACCEPTED:    
 
        AMERICAN STOCK TRANSFER & TRUST COMPANY    
 
       
By:
       
Name:
 
 
   
Title:
 
 
   
 
 
 
   

{Signature Page to the Amendment No. 1 to Rights Agreement}