EXHIBIT G
SUPPLEMENTAL GOVERNANCE AGREEMENT
THIS SUPPLEMENTAL GOVERNANCE AGREEMENT (this
"Agreement"), dated as of February 26, 1996, by and among
American Communications Services, Inc., a Delaware corporation
(the "Company"), and certain holders of the outstanding shares of
9% Series A-1 Convertible Preferred Stock, $1.00 par value (the
"Series A-1 Preferred Stock"), 9% Series B-1 Convertible
Preferred Stock, $1.00 par value, 9% Series B-2 Convertible
Preferred Stock, $1.00 par value, 9% Series B-3 Convertible
Preferred Stock, $1.00 par value and 9% Series B-4 Convertible
Preferred Stock, $1.00 par value (collectively, the "Series B
Preferred Stock" and together with the Series A-1 Preferred
Stock, the "Preferred Stock") of the Company set forth in
Schedule I hereto (collectively the "Voting Shareholders"). All
terms used herein and not otherwise defined shall have the
meanings ascribed to such terms in the Governance Agreement dated
as of November 9, 1995 between the Company and the Voting
Shareholders.
R E C I T A L S
WHEREAS, on November 8, 1995, in response to voting
rights issues raised by the National Association of Securities
Dealers Automated Quotation System ("NASDAQ") and in fulfillment
of a condition to the Company's continued listing on NASDAQ, the
Company and the Voting Shareholders entered into a Governance
Agreement (the "Governance Agreement") pursuant to which, among
other things, the Voting Shareholders agree to cause the
composition and election of the Board of Directors and the
Preferred Veto Rights to be consistent with the Certificate of
Designations Amendments until such time as such amendments were
approved by the stockholders of the Company, notwithstanding any
contrary provisions in the Current Certificate of Designations;
and
WHEREAS, pursuant to the Governance Agreement, it was
deemed that a Triggering Event (as such term was defined in the
Series A Certificate) would have occurred on or prior to June 26,
1995, the date a Certificate of Elimination relating to the
Series A Certificate was filed with the Secretary of State of the
State of Delaware; and
WHEREAS, pursuant to the Series A Certificate the
occurrence of a Triggering Event would have caused an increase in
the size of the Board of Directors from seven directors to 11
directors and resulted in the composition of the Board changing
from four directors elected by the holders of the Common Stock
and three directors elected by the holders of the Preferred Stock
to four directors elected by the holders of the Common Stock and
seven directors elected by the holders of the Preferred Stock;
and
WHEREAS, under the Series A Certificate the Board would
have remained at 11 directors, with four elected by the holders
of the Common Stock and seven elected by the holders of the
Preferred Stock, for one year after all Triggering Events had
been cured; and
WHEREAS, the aforementioned Triggering Event would have
been deemed to have been cured on June 26, 1995; and
WHEREAS, in connection with the Company's application
to have its common stock, par value $0.01 per share (the "Common
Stock") be included in the NASDAQ National Market System
("NASDAQ/NMS"), NASDAQ/NMS has required that the Board revert to
its original structure of seven members; and
WHEREAS, pursuant to the Governance Agreement, the
Board was to consist of 11 directors until June 26, 1996; and
WHEREAS, the Governance Agreement was terminated
pursuant to its terms upon the approval by the Company's
stockholders on January 26, 1996 of certain amendments to the
Company's Certificate of Incorporation; and
WHEREAS, the Voting Shareholders deem it to be in their
best interests and the best interests of the Company for the
Company's Common Stock to be included in NASDAQ/NMS; and
WHEREAS, the Voting Shareholders deem it to be in their
best interests and the best interests of the Company to use all
reasonable efforts to cause the Board to revert to a seven member
board immediately.
NOW THEREFORE, in consideration of the foregoing and
for other good and valuable consideration, the parties hereto
hereby agrees as follows:
1. Board of Directors
The Board shall immediately revert to seven directors,
four of whom will be Common Directors and three of whom will be
Preferred Directors. Commencing immediately as of the date
hereof, all matters relating to the Board, including without
limitation its size, composition, powers and voting with respect
thereto shall be governed by the Amended and Restated
Certification of Incorporation and the Amended and Restated
By-Laws of the Company.
2. Further Assurances
The Voting Shareholders will use all reasonable efforts
and take all reasonable actions to enable the Company to
implement the provisions of this Agreement.
3. General Provisions
3.1 Contents of Agreement, Parties in Interest,
Assignment. This Agreement sets for the entire understanding of
the parties with respect to the subject matter hereof. Any
previous agreements or understandings between the parties
regarding the subject hereof are merged into and superseded by
this Agreement. All terms and conditions of this Agreement shall
be binding upon and inure to the benefit of and be enforceable by
the respective heirs, legal representatives, successors and
permitted assigns of the parties hereto.
3.2 Severability. In the event that any one or
more of the provisions contained in this Agreement shall be
invalid or unenforceable in any respect for any reason, the
validity, legality and enforceability of such provision in every
other respect and of the remaining provisions of this Agreement
shall not be in any way impaired.
3.3 Headings. The headings of the Sections and
the subsections of this Agreement are inserted for convenience of
reference only and shall not constitute a part hereof.
3.4 Notices. Any notice, request, claim, demand,
document and other communication hereunder to any party shall be
effective upon receipt (or refusal of receipt) and shall be in
writing and delivered personally or sent by telex or telecopy
(with such telex or telecopy confirmed promptly in writing sent
by first class mail), or first class mail, or other similar means
of communications, as follows:
(i) If to Xxxx, addressed to The Xxxx Alternative
Income Fund, L.P., 00 Xxxx Xxxxx, 0xx Xxxxx,
Xxxxxxxxxx, Xxx Xxxxxx 00000, Attention: Xxxxxx
Xxxxxxxx, Telecopier Number (000) 000-0000;
(ii) If to ING, addressed to ING Equity Partners, L.P.,
000 Xxxx 00xx Xxxxxx, 0xx Xxxxx, Xxx Xxxx, Xxx
Xxxx 00000, Attention: Xxxxxxx X. Xxxxxxxxx,
Telecopier Number (000) 000-0000;
(iii) If to the Company, addressed to American
Communications Services, Inc., 000 Xxxxxxxx
Xxxxxxxx Xxxxxxx, Xxxx 000, Xxxxxxxxx Xxxxxxxx, XX
00000, Attention: Xxxxxxx X. Xxxxx, Telecopier
Number (000) 000-0000; or
(iv) If to a Voting Shareholder other than Xxxx or ING,
to the address of such Voting Shareholder set
forth in the stock records of the Company;
or, in each case, to such other address or telex or
telecopy number as such party may designate in writing to each
Voting Shareholder and the Company by written notice given in the
manner specified herein.
All such communications shall be deemed to have been
given, delivered or made when so delivered by hand or sent by
telex (answer back received) or telecopy, or five business days
after being so mailed.
3.5 LITIGATION. THIS AGREEMENT SHALL BE GOVERNED
BY, CONSTRUED, APPLIED AND ENFORCED IN ACCORDANCE WITH THE LAWS
OF THE STATE OF NEW YORK. EACH OF THE PARTIES HERETO
ACKNOWLEDGES AND AGREES THAT IN THE EVENT OF ANY BREACH OF THIS
AGREEMENT, THE NON-BREACHING PARTIES WOULD BE IRREPARABLY HARMED
AND COULD NOT BE MADE WHOLE BY MONETARY DAMAGES, AND THAT, IN
ADDITION TO ANY OTHER REMEDY TO WHICH THEY MAY BE ENTITLED AT LAW
OR IN EQUITY, THE PARTIES SHALL BE ENTITLED TO SUCH EQUITABLE OR
INJUNCTIVE RELIEF AS MAY BE APPROPRIATE. EACH PARTY AGREES THAT
JURISDICTION AND VENUE WILL BE PROPER IN THE SOUTHERN DISTRICT OF
NEW YORK AND WAIVES ANY OBJECTIONS BASED UPON FORUM NON
CONVENIENS. EACH PARTY WAIVES PERSONAL SERVICE OF PROCESS AND
AGREES THAT A SUMMONS AND COMPLAINT COMMENCING AN ACTION OR
PROCEEDING SHALL BE PROPERLY SERVED AND SHALL CONFER PERSONAL
JURISDICTION IF SERVED BY REGISTERED OR CERTIFIED MAIL TO THE
PARTY AT THE ADDRESS SET FORTH IN THIS AGREEMENT, OR AS OTHERWISE
PROVIDED BY THE LAWS OF THE STATE OF NEW YORK OR THE UNITED
STATES. THE CHOICE OF FORUM SET FORTH IN THIS SECTION 3.5 SHALL
NOT BE DEEMED TO PRECLUDE THE ENFORCEMENT OF ANY JUDGMENT
OBTAINED IN ANY OTHER FORUM OR THE TAKING OF ANY ACTION UNDER
THIS AGREEMENT TO ENFORCE SAME IN ANY OTHER APPROPRIATE
JURISDICTION.
3.6 Counterparts. This Agreement may be executed
in counterparts, each of which shall be considered an original,
but all of which together shall constitute the same instrument.
3.7 Expenses. The Company will reimburse the
Voting Shareholders for the reasonable expenses, including
reasonable counsel fees, which they incur in connection with this
Agreement.
3.8 Cost of Enforcement. The party which
prevails in any suit or proceeding against the other to enforce
any provision of this Agreement or to recover damages resulting
from a breach of this Agreement shall be entitled to receive from
the nonprevailing party the costs and reasonable attorneys' fees
of the prevailing party incurred in such suit or proceeding.
Supplemental Governance Agreement
IN WITNESS WHEREOF, this Agreement has been executed by
the parties hereto as of the day and year first above written.
AMERICAN COMMUNICATIONS SERVICES,
INC.
By: ______________________________
Name:
Title:
THE XXXX ALTERNATIVE INCOME FUND, L.P.
By: WRH PARTNERS, L.L.C.
general partner
By: _____________________________
Name:
Title:
Supplemental Governance Agreement
ING EQUITY PARTNERS, L.P. I
By: LEXINGTON PARTNERS, L.P.
its general partner
By: LEXINGTON PARTNERS, INC.
its general partner
By:
Name:
Title:
APEX INVESTMENT FUND, L.P.
By: APEX MANAGEMENT PARTNERSHIP,
L.P., general partner
By: _____________________________
Xxxxxx X. Xxxxxxxxx
General Partner
APEX INVESTMENT FUND II, L.P.
By: APEX MANAGEMENT PARTNERSHIP,
L.P., general partner
By:
Xxxxxx X. Xxxxxxxxx
General Partner
Supplemental Governance Agreement
THE PRODUCTIVITY FUND II, L.P.
By: FIRST ANALYSIS MANAGEMENT
COMPANY II,
its general partner
By: FIRST ANALYSIS CORPORATION,
general partner
By:
Name:
Title:
ARGENTUM CAPITAL PARTNERS, L.P.
By: BR Associates, Inc.,
general partner
By: ___________________________
Name:
Title:
ENVIRONMENTAL PRIVATE EQUITY
FUND II, L.P.
By: Environmental Private Equity
Management II, L.P.
its general partner
By: First Analysis EPEF Management
COMPANY II, general partner
By: First Analysis Corporation,
general partner
By:
Name:
Title:
