Exhibit 4.6
AMENDED AND RESTATED
SHAREHOLDERS AGREEMENT
Dated as of July 26, 2000
among
CFW COMMUNICATIONS COMPANY
WELSH, CARSON, XXXXXXXX & XXXXX VIII, L.P.,
WELSH, CARSON, XXXXXXXX & XXXXX IX, L.P.
and
THE OTHER PERSONS LISTED
ON THE SIGNATURE PAGES HEREOF
TABLE OF CONTENTS
ARTICLE 1. DEFINITIONS
SECTION 1.01 Definitions..................................................
ARTICLE 2. RIGHTS AND OBLIGATIONS WITH RESPECT TO TRANSFER
SECTION 2.01 General Restrictions.........................................
SECTION 2.02 Agreement to Be Bound........................................
SECTION 2.03 Legends......................................................
ARTICLE 3. REGISTRATION RIGHTS
SECTION 3.01 Demand Registration Rights...................................
SECTION 3.02 Piggy-Back Registration Rights...............................
SECTION 3.03 Registration Procedures......................................
SECTION 3.04 Participation in Underwritten Registrations..................
SECTION 3.05 Indemnification..............................................
SECTION 3.06 Shelf Registration...........................................
SECTION 3.07 Holdback Agreements..........................................
ARTICLE 4. CORPORATE GOVERNANCE; COVENANTS
SECTION 4.01 Board of Directors...........................................
SECTION 4.02 Voting.......................................................
ARTICLE 5. STANDSTILL
SECTION 5.01 Acquisition of Voting Securities/Board Control...............
ARTICLE 6. MISCELLANEOUS
SECTION 6.01 Headings.....................................................
SECTION 6.02 No Inconsistent Agreements...................................
SECTION 6.03 Entire Agreement.............................................
SECTION 6.04 Notices......................................................
SECTION 6.05 Applicable Law; Submission to Jurisdiction...................
SECTION 6.06 Severability.................................................
SECTION 6.07 Successors, Assigns, Transferees.............................
SECTION 6.08 Amendments; Waivers..........................................
SECTION 6.09 Counterparts.................................................
SECTION 6.10 Recapitalization, etc........................................
SECTION 6.11 Remedies.....................................................
SECTION 6.12 Reasonable Best Efforts......................................
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SHAREHOLDERS AGREEMENT
AMENDED AND RESTATED SHAREHOLDERS AGREEMENT (this "Agreement") dated
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as of July 26, 2000 among CFW Communications Company, a Virginia corporation
(the "Issuer"), Welsh, Carson, Xxxxxxxx & Xxxxx VIII, L.P. and Welsh, Carson,
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Xxxxxxxx & Xxxxx IX, L.P., each a Delaware limited partnership (together,
"WCAS"), and each of the other Persons listed on the signature pages hereof.
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Each of the parties to this Agreement (other than the Issuer) and any other
Person who, pursuant to the terms hereof, shall become a party to or agree to be
bound by the terms of this Agreement after the date hereof is sometimes
hereinafter referred to as a "Holder".
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WHEREAS, the parties hereto are the parties to a Shareholders
Agreement dated as of July 11, 2000 (the "Original Shareholder Agreement"), and
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pursuant to Section 6.08 of the Original Shareholder Agreement, the parties
hereto desire to amend and restate the Original Shareholder Agreement;
WHEREAS, the parties hereto are the parties to a Securities Purchase
Agreement dated as of July 11, 2000 (as amended from time to time, the "Series B
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Purchase Agreement") pursuant to which the Holders purchased Series B Shares (as
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defined below) from the Issuer pursuant to and in accordance with the terms of
the Series B Purchase Agreement;
WHEREAS, the parties hereto are the parties to a Securities Purchase
Agreement dated as of July 26, 2000 (as amended from time to time, the "Series C
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Purchase Agreement" and, together with the Series B Purchase Agreement, the
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"Purchase Agreements") pursuant to which the Holders purchased Series C Shares
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(as defined below) from the Issuer pursuant to and in accordance with the terms
of the Series C Purchase Agreement; and
WHEREAS, the parties hereto desire to provide for certain rights and
obligations relating to the capital stock of the Issuer and certain matters
relating to the conduct of the business and the affairs of the Issuer following
the date hereof.
NOW, THEREFORE, the parties hereto agree as follows:
1.
DEFINITIONS
1. Definitions. The following terms, as used herein, have the
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following meanings:
"Affiliate" means, with respect to any Person, any other Person,
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directly or indirectly, controlling, controlled by, or under common control
with, such Person; provided that, for purposes of this Agreement, (i) the Issuer
shall not be treated as an Affiliate of any Holder or its Affiliates, (ii) a
Holder and its Affiliates shall not be treated as Affiliates of the Issuer or
its Affiliates or as Affiliates of any other Holder or such Holder's Affiliates
solely by reason of its ownership interest in the Issuer, (iii) any portfolio
company of a Holder shall not be treated as an Affiliate of such Holder and (iv)
each individual Holder's Family Group shall be treated as an
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Affiliate of such Holder. For purposes of this definition, the term "control"
(including the correlative terms "controlling", "controlled by" and "under
common control with") means the possession, direct or indirect, of the power to
direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract, or otherwise.
"beneficial ownership" and "beneficially own" shall be determined in
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accordance with Rules 13d-3 and 13d-5 under the Exchange Act.
"Board of Directors" means the Board of Directors of the Issuer.
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"Business Day" means any day except a Saturday, Sunday or other day on
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which commercial banks in the City of New York are authorized by law to close.
"Commission" means the Securities and Exchange Commission or any
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successor commission or agency having similar powers.
"Common Shares" means shares of the common stock of the Issuer, no par
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value per share.
"Competitor" means any Person that is both (i) engaged in the business
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of providing telecommunication services offered by the Issuer and its
Subsidiaries that generate at least 5% of the Issuer's consolidated revenues as
of the date of the Issuer's most recent Form 10-K or 10-Q filed with the
Commission and the revenues of such Person attributable to such services exceed
$10 million annualized and (ii) a competitor of the Issuer operating in any of
the Major Trading Areas in which the Issuer and its Subsidiaries are operating
as of the time of the proposed Transfer.
"Daily Price" means, as of any date, (i) if the Common Shares then are
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listed and traded on the New York Stock Exchange, Inc. ("NYSE"), the closing
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price on such date as reported on the NYSE Composite Transactions Tape; (ii) if
the Common Shares then are not listed and traded on the NYSE, the closing price
on such date as reported by the principal national securities exchange on which
the shares are listed and traded; (iii) if the Common Shares then are not listed
and traded on any such securities exchange, the last reported sale price on such
date on the National Market of the National Association of Securities Dealers,
Inc. Automated Quotation System ("NASDAQ"); or (iv) if the Common Shares then
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are not traded on the NASDAQ National Market, the average of the highest
reported bid and lowest reported asked price on such date as reported by NASDAQ.
"Exchange Act" means the Securities Exchange Act of 1934, as amended,
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and the rules and regulations promulgated thereunder.
"Family Group" means, with respect to an individual Holder, such
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Holder's spouse and descendants (whether natural or adopted) and any trust
solely for the benefit of such
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Holder and/or such Holder's spouse, their respective ancestors and/or
descendants (whether natural or adopted).
"Fully-Diluted Basis" means taking into account all outstanding Common
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Shares, shares issuable in respect of stock appreciation rights or options,
warrants and other rights to purchase or subscribe for Common Shares or
securities convertible into or exchangeable for Common Shares.
"group" shall have the meaning set forth in Section 13(d)(3) of the
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Exchange Act.
"Initial Holders" means WCAS, the other Persons listed on the
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signature pages hereof (other than the Issuer) and their respective Permitted
Transferees.
"Initial Holdings" means the Preferred Shares issued to WCAS and the
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other Persons listed on the signature pages hereof pursuant to the Purchase
Agreements and/or the Common Shares into which such Preferred Shares may
initially be converted.
"Person" means an individual, partnership, corporation, limited
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liability company, trust, joint stock company, association, joint venture, or
any other entity or organization.
"Permitted Transferee" means any Person that becomes a Holder under
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this Agreement by acquiring any of the Initial Holdings from any other Holder.
"Preferred Shares" means the Series B Shares and the Series C Shares.
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"Prohibited Transferee" means, at the time of any proposed Transfer,
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(i) any Competitor, (ii) any Person who directly or indirectly owns 15% or more
of the outstanding voting securities of any Competitor and has the right to
representation on the board of directors of such Competitor or (iii) any Person
who has signed a binding contract to acquire one or more Competitors in
connection with a consolidation or roll up of related companies, or otherwise.
"Public Offering" means any underwritten public offering of equity
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securities of the Issuer pursuant to an effective registration statement under
the Securities Act other than pursuant to a registration statement on Form S-4
or Form S-8 or any successor or similar form.
"Registering Holders" means Holders whose Registrable Shares are
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covered by or offered pursuant to a registration statement filed pursuant to
Article 3.
"Registrable Shares" means (i) all Preferred Shares acquired by or
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issued or issuable to, Holders on or after the date hereof; (ii) all Common
Shares acquired by or issued or issuable to, Holders on or after the date
hereof, including the Common Shares issued or issuable upon conversion of the
Preferred Shares and (iii) any equity securities, whether of the Issuer or any
other person, issued or issuable to Holders with respect to the securities
referred to in clauses (i) and (ii) above by way of stock dividend or stock
split or in connection with a combination or exchange of shares,
recapitalization, merger, consolidation or other reorganization. Registrable
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Shares shall cease to be Registrable Shares when (x) they have been distributed
to the public pursuant to an offering registered under the Securities Act or
sold to the public in compliance with Rule 144, (y) such Common Shares or
Preferred Shares shall have ceased to be outstanding or (z) they are held or
proposed to be distributed by a Person that is not a Holder, except with respect
to any Transfer to an Affiliate of such Holder or to the partners, shareholders
or members of such Holder.
"Registration Expenses" means all expenses incident to the Issuer's
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performance of or compliance with Article III hereof, including without
limitation, (i) registration, qualification and filing fees, (ii) fees and
expenses of compliance with securities or blue sky laws (including reasonable
fees and disbursements of a qualified independent underwriter, if any, counsel
in connection therewith and the reasonable fees and disbursements of counsel in
connection with blue sky qualifications of the Registrable Shares), (iii)
printing expenses, (iv) internal expenses of the Issuer (including, without
limitation, all salaries and expenses of officers and employees performing legal
or accounting duties), (v) fees and disbursements of counsel for the Issuer,
(vi) customary fees and expenses for independent certified public accountants
retained by the Issuer (including the expenses of any comfort letters or costs
associated with the delivery by independent certified public accountants of a
comfort letter or comfort letters), (vii) fees and expenses of any special
experts retained by the Issuer in connection with such registration, (viii)
reasonable fees and expenses of one separate firm of attorneys for the
Registering Holders (which counsel shall be selected by the Registering Holders
selling securities constituting a majority of all securities to be included in
such registration) and (ix) fees and expenses of listing the Registrable Shares
on a securities exchange or market for trading; but shall not include any
underwriting fees or discounts or commissions attributable to the sale of
Registrable Shares.
"Requesting Holders" has the meaning given to it in Section
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3.01(a)(i).
"Securities Act" means the Securities Act of 1933, as amended, and the
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rules and regulations promulgated thereunder.
"Series B Shares" means shares of Senior Cumulative Convertible
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Preferred Stock, Series B, no par value per share, of the Issuer.
"Series C Shares" means shares of Senior Cumulative Convertible
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Preferred Stock, Series C, no par value per share, of the Issuer.
"Shares" means the Common Shares and the Preferred Shares.
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"Subsidiary" means any entity of which ownership interests having
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ordinary voting power to elect a majority of the board of directors or other
Persons performing similar functions are at the time directly or indirectly
owned by the Issuer.
"Transaction Agreements" means this Agreement, the Purchase
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Agreements, the Warrant Agreement (as defined in the Series B Purchase
Agreement) and the Articles of
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Amendment to the Issuer's Articles of Incorporation for each of the Series B
Shares and the Series C Shares.
"Transfer" means, with respect to any security, (i) when used as a
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verb, to sell, assign, dispose of, exchange or otherwise transfer such security
or any interest therein, whether directly or indirectly, or agree or commit to
do any of the foregoing and (ii) when used as a noun, a direct or indirect sale,
assignment, disposition, exchange or other transfer of such security or any
interest therein or any agreement or commitment to do any of the foregoing.
"Voting Securities" means all securities of the Issuer entitled, in
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the ordinary course, to vote in the election of directors of the Issuer.
1.
RIGHTS AND OBLIGATIONS WITH RESPECT TO TRANSFER
1. General Restrictions. Each Transfer of Shares must be made in
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compliance with the Securities Act, any applicable state and foreign securities
law and this Article 2. Each Holder understands and agrees that the Shares have
not been registered under the Securities Act and that they are restricted
securities. Any attempt to Transfer, pledge, grant a security interest in, or
otherwise encumber any Shares not in compliance with this Agreement shall be
null and void and neither the Issuer nor any transfer agent shall give any
effect in the Issuer's transfer records to such Transfer, pledge, grant or
encumbrance. In addition, each Holder agrees that, except with respect to any
Transfer to an Affiliate of such Holder or to the partners, shareholders or
members of such Holder (i) any proposed Transfer of Preferred Shares prior to
July 11, 2002 shall require the prior written approval of the Issuer, and (ii)
any proposed Transfer of Preferred Shares to a Prohibited Transferee on or after
July 11, 2002 shall require the prior written approval of the Issuer.
1. Agreement to Be Bound. No Transfer of Shares otherwise permitted
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pursuant to Article 2 (other than Transfers pursuant to a Public Offering or
Rule 144 (or any successor provision) under the Securities Act (as such rule may
be amended from time to time, "Rule 144") or Transfers to the Issuer) shall be
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effective unless (i) the certificates representing such Shares delivered to such
transferee shall bear the legend set forth in Section 2.03, if required by such
Section, and (ii) prior to such Transfer, (A) such transferee (if not already a
party to this Agreement) shall have executed and delivered to the Issuer an
instrument or instruments substantially in the form of Exhibit A hereto
confirming that such transferee has agreed to be bound as a "Holder" by the
terms of this Agreement, a copy of which instrument shall be maintained on file
with the Secretary of the Issuer and shall include the address of such
transferee to which notices hereunder shall be sent and (B) if so requested by
the Issuer, upon receipt of an opinion of counsel (which shall be reasonably
acceptable to the Issuer) to the effect that such Shares may be sold or
transferred pursuant to an exemption from registration under the Securities Act;
provided that the provisions of clause (ii) above shall not be applied to any
Transfer by a Holder of any of its Shares to the Affiliates, partners, members
or securityholders
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of such Holder pursuant to a distribution in respect of the partnership
interests, membership interests or other ownership interests of such Holder.
1.Legends.
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(a) Each certificate evidencing outstanding Shares acquired by
any Holder shall bear a legend in substantially the following form:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, OR ANY STATE SECURITIES LAWS AND
MAY NOT BE OFFERED, SOLD, OR TRANSFERRED EXCEPT IN
COMPLIANCE THEREWITH. THE SECURITIES REPRESENTED BY
THIS CERTIFICATE ARE ALSO SUBJECT TO ADDITIONAL
RESTRICTIONS ON TRANSFER AS SET FORTH IN THE AMENDED
AND RESTATED SHAREHOLDERS AGREEMENT DATED AS OF JULY
26, 2000, A COPY OF WHICH WILL BE FURNISHED BY THE
ISSUER UPON REQUEST AND WITHOUT CHARGE.
(a) If any Shares (i) shall cease to be Registrable Shares, (ii)
may be sold pursuant to Rule 144(k) or otherwise in the public market without
being registered under the Securities Act or (iii) are sold pursuant to Rule 144
(other than Rule 144(k)) to a person who is not an Affiliate of the Issuer, upon
the written request of the holder thereof, the Issuer shall issue, in the case
of clauses (i) and (ii) above, to such holder and, in the case of clause (iii),
to the purchaser thereof, a new certificate evidencing such Shares without the
first sentence of the legend required by Section 2.03(a) hereof endorsed
thereon. If any Shares shall cease to be subject to the restrictions on Transfer
set forth in this Agreement, the Issuer shall, upon the written request of the
holder thereof, issue to such holder a new certificate evidencing such Shares
without the second sentence of the legend (or the reference therein to the
applicable agreement) required by Section 2.03(a) hereof endorsed thereon.
2.
REGISTRATION RIGHTS
1.Demand Registration Rights.
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(a) Registration on Request. Subject to Section 3.06, at any
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after the date hereof, the holders of at least a majority of the then
outstanding Registrable Shares (on an as converted basis) may make a written
request that the Issuer effect a registration under the Securities Act of all or
any portion of such Holder(s) Registrable Shares. Each such request will
specify the number of shares of Registrable Shares proposed to be sold and will
also specify the intended method of disposition thereof. The Issuer will
promptly give written notice of such requested registration to all other Holders
of Registrable Shares and thereupon will effect, as promptly as practicable, the
registration under the Securities Act of:
(i) the Registrable Shares which the Issuer has been so requested
to register by the Holders requesting such registration (the
"Requesting Holders") pursuant to this Section 3.01; and
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(ii) the Registrable Shares which the Issuer has been
requested to register by all Holders (other than such
Requesting Holders) by written request given to the Issuer
within 15 days after the giving of such written notice by
the Issuer;
all to the extent necessary to permit the disposition (in accordance with the
intended methods thereof as aforesaid) of the Registrable Shares so to be
registered; provided that:
(x) with respect to all requests for registration of
any Registrable any Registrable Shares held by Holders
(other than the last request), the Registrable
Securities requested to be included in such
registration have an aggregate market value of at
least $10 million as of the close of business on the
trading day immediately preceding such request;
(y) subject to Section 3.01(f), the Issuer shall not
be obligated to effect more than four registrations
pursuant to this Section 3.01; and
(z) at the time of any request to register
Registrable Shares pursuant to this Section 3.01, if
the Board of Directors determines in its good faith
judgment that the Issuer should not file any
registration statement otherwise required to be filed
pursuant to Section 3.01(a) because the Issuer
intends to conduct a public offering of its equity
securities as contemplated by Section 3.02 or because
the Issuer is engaged in any financing, acquisition
or other material transaction which would require the
Issuer to disclose material non-public information,
the Issuer shall be entitled to postpone for the
shortest reasonable period of time (but not exceeding
90 days from the date of the request), the filing of
such registration statement and shall promptly give
the Requesting Holders written notice of such
determination, containing a general statement of the
reasons for such postponement and an approximation of
the anticipated delay. Such right to delay a request
for registration pursuant to this Section 3.01 may
not be exercised more than once in any 12-month
period. If the Issuer shall so postpone the filing of
the registration statement, the Requesting Holders
proposing to sell securities constituting a majority
of all securities requested to be included by all
Requesting Holders (the "Majority Requesting
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Holders") shall have the right to withdraw (without
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prejudice to their rights under clause (y) above) the
request for registration by giving written notice to
the Issuer within 30 days after receipt of the notice
of postponement.
Promptly after the expiration of the 15-day period referred to in
clause (ii) above, the Issuer shall notify each holder of Registrable Shares to
be included in the registration of the
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other holders requesting Registrable Shares to be included therein and the
number of Registrable Shares requested to be included therein. The Majority
Requesting Holders may, at any time prior to the effective date of the
registration statement relating to such registration, revoke such request,
without liability to any other holder holding Registrable Shares requested to be
registered pursuant to clause (ii) above, by providing a written notice to the
Issuer revoking such request; and such revocation shall be without prejudice to
the rights of the Holders under clause (y) above.
(a) Priority Participation in Requested Registrations. If the
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managing underwriter shall advise the Issuer that, in its view, the number of
securities requested to be included in such registration (including securities
which the Issuer may request to be included which are not Registrable Shares)
exceeds the largest number of securities which can be sold in an orderly manner
in such offering within a price range acceptable to holders of a majority of the
Registrable Shares initiating such registration and without having a material
adverse effect on such offering (the "Maximum Offering Size"), the Issuer will
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include in such registration:
(i) first, the Registrable Shares requested to be included in
such registration, allocated (if necessary) among the holders of
such Registrable Shares pro rata based on the number of
Registrable Shares requested to be included in such registration;
and
(ii) second, Common Shares to be sold for the account of other
Persons (including the Issuer), with such priorities among them
as the Issuer shall determine
(b) Registration Statement Form. Registrations under this Section
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3.01 shall be on such appropriate registration form of the Commission (i) as
shall be selected by the Issuer, subject to Section 3.01(a), and as shall be
reasonably acceptable to the Requesting Holders and (ii) as shall permit the
disposition of such Registrable Shares in accordance with the method or methods
of disposition intended on the part of the Requesting Holders who initiated the
request. Notwithstanding anything herein to the contrary, if, pursuant to a
registration request under this Section 3.01, the Issuer proposes to effect
registration by filing of a registration statement on Form S-3 (or any successor
or similar short-form registration statement) and any managing underwriter shall
advise the Issuer in writing that, in its opinion, the use of another form of
registration statement would improve the likelihood of the success of such
proposed offering, then such registration shall be effected on such other form.
(c) Expenses. The Issuer will pay promptly all Registration Expenses
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in connection with the registration requests made pursuant to this Section 3.01
(d) Underwriters. The managing underwriter or underwriters of any
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Public Offering effected pursuant to this Section 3.01 shall be selected by the
Majority Requesting Holders, which selection shall be reasonably satisfactory to
the Issuer. The price, terms and provisions of such offering shall be subject
to the approval of the Requesting Holders. The Issuer will enter into customary
agreements (including an underwriting agreement in customary form) and take such
other actions as are reasonably required in order to expedite or facilitate the
disposition of such Registrable Shares. The Holders shall not be required by
the Issuer to make any representation or warranty in the underwriting agreement
in connection with such offering
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other than as to their ownership and authority
to Transfer, free of liens, claims and encumbrances (other than those that arise
under the terms of this Agreement).
(e) Unless at least 75% of the Registrable Shares requested to be
registered by the Requesting Holders are included in such registration, such
registration will not count as one of the four registrations referenced in
clause (a)(y) of Section 3.01
2.Piggy-Back Registration Rights.
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(a) Right to Include Registrable Shares. Subject to Section 3.06, if
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the Issuer at any time proposes to register any of its equity securities under
the Securities Act (other than (i) by a registration on Form X-0, Xxxx X-0 or
any successor or similar form, (ii) pursuant to a registration requested
pursuant to Section 3.01, (iii) in connection with a direct acquisition by the
Issuer of another Person or (iv) pursuant to an employee share purchase plan,
dividend reinvestment plan or similar plan of the Issuer), in each case whether
or not for sale for its own account, it will at each such time give prompt
written notice at least 30 days prior to the anticipated filing date of the
registration statement relating to such registration to all Holders of
Registrable Shares of its intention to do so and of such Holders' rights under
this Section 3.02. Any such notice shall offer all such Holders, subject to
Section 3.06, the opportunity to include in such registration such number of
Registrable Shares as each such Holder may request. Upon the written request of
any Holder made within 15 days after the receipt of any such notice (which
request shall specify the number of Registrable Shares intended to be disposed
of by such Holder), the Issuer will use its best efforts to effect the
registration with the Commission under the Securities Act and any related
qualification or other compliance of all Registrable Shares which the Issuer has
been so requested to register, to the extent required to permit the disposition
of the Registrable Shares to be so registered; provided that if, at any time
after giving written notice of its intention to register any securities and
prior to the effective date of the registration statement filed in connection
with such registration, the Issuer shall determine for any reason not to
register or to delay registration of such securities, the Issuer shall give
written notice of such determination to each Holder and, thereupon, (x) in the
case of a determination not to register, shall be relieved of its obligation to
register any Registrable Shares in connection with such registration (but not
from its obligation to pay the Registration Expenses in connection therewith),
without prejudice, however, to the rights of any Holder entitled to do so, to
request that such registration be effected as a registration under Section 3.01,
and (y) in the case of a determination to delay registering, shall be permitted
to delay registering any Registrable Shares, for the same period as the delay in
registering such other securities. Each Holder holding Registrable Shares
requesting to be included in such registration may elect, in writing not less
than 5 Business Days prior to the effective date of the registration statement
filed in connection with such registration, not to register such securities in
connection with such registration; provided that any such holder may withdraw
its request for inclusion at any time prior to executing the underwriting
agreement or if none, prior to the registration statement becoming effective.
No registration effected under this Section 3.02 shall relieve the Issuer of its
obligation to effect any registration upon request under Section 3.01. The
Issuer will pay promptly all Registration Expenses in connection with each
registration of Registrable Shares requested pursuant to this Section 3.02.
(b) Priority in Incidental Registrations. If a registration pursuant
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to this Section 3.02 involves a Public Offering and the managing underwriter
shall advise the Issuer
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that, in its view, the number or proposed mix of securities (including all
Registrable Shares) which the Issuer, the Holders and any other Persons intend
to include in such registration exceeds the Maximum Offering Size, the Issuer
will include in such registration, in the priority listed below, securities up
to the Maximum Offering Size:
(i) first, the equity securities the Issuer proposes to sell;
(ii) second, the Registrable Shares requested to be included in
such registration, allocated (if necessary) among the holders of
such Registrable Shares pro rata based on the number of
Registrable Shares requested by them to be included in such
registration; and
(iii) third, equity securities to be sold for the account of
other Persons having incidental registration rights with such
priorities among them as the Issuer shall determine
3.Registration Procedures. If the Issuer is required to effect
-----------------------
the registration of any Registrable Shares under the Securities Act as provided
in Section 3.01 or 3.02 the Issuer will, as promptly as possible:
(a) prepare and file with the Commission a registration statement on
an appropriate form (subject to 3.01(c)), and thereafter use its best efforts to
cause such registration statement to become effective and to remain effective
pursuant to the terms of the underwriting agreement and prepare and file with
the Commission such amendments and supplements to such registration statement
and the prospectus used in connection therewith as may be necessary to keep such
registration statement effective for the period specified pursuant to the terms
of the underwriting agreement and to comply with the provisions of the
Securities Act with respect to the disposition of all securities covered by such
registration statement until the lesser of (i) such time as all of such
securities have been disposed of in accordance with the intended methods of
disposition by the Registering Holders thereof set forth in such registration
statement and (ii) 120 days; provided that the Issuer will, at least 5 Business
Days (or at least 3 Business Days in the case of incidental registrations) prior
to filing a registration statement or prospectus or any amendment or supplement
thereto, furnish to each Registering Holder copies of such registration
statement or prospectus (or amendment or supplement) as proposed to be filed
(including, upon the request of such Holder, documents to be incorporated by
reference therein) which documents will be subject to the reasonable review and
comments of such Holder (and its attorneys) during such 5-Business Day period
(or 3-Business Day period, as the case may be) and the Issuer will not file any
registration statement, any prospectus or any amendment or supplement thereto
(or any such documents incorporated by reference) containing any statements with
respect to such Holder to which such Holder shall reasonably object in writing;
(b) furnish to each Registering Holder and to any underwriter such
number of conformed copies of such registration statement and of each such
amendment and supplement thereto (in each case including all exhibits), the
prospectus contained in such registration statement (including each preliminary
prospectus and any summary prospectus) and any other prospectus filed under Rule
424 or Rule 430A under the Securities Act, in conformity with the requirements
of the Securities Act, documents incorporated by reference in such registration
statement, amendment, supplement or prospectus and such other documents (in each
case including all exhibits), as a Registering Holder or underwriter may
reasonably request;
12
(c) after the filing of the registration statement, promptly
notify each Registering Holder of the effectiveness thereof and of any stop
order issued or threatened by the Commission and take all reasonable actions
required to prevent the entry of such stop order or to remove it if entered and
promptly notify such Registering Holder of such lifting or withdrawal of such
order;
(d) use its best efforts to register or qualify all Registrable
Shares and other securities covered by such registration statement under such
other securities or blue sky laws of such jurisdictions as the Registering
Holders holding a majority of the Registrable Shares to be included in such
registration or the underwriter shall reasonably request, to keep such
registration or qualification in effect for so long as such registration
statement remains in effect, and take any other action which may be reasonably
necessary or advisable to enable the Registering Holders to consummate the
disposition in such jurisdictions of the securities owned by such Registering
Holders, except that the Issuer shall not for any such purpose be required to
qualify generally to do business as a foreign corporation in any jurisdiction
wherein it would not but for the requirements of this Section 3.03(d) be
obligated to be so qualified, to subject itself to taxation in any such
jurisdiction or to consent to general service of process in any such
jurisdiction;
(e) use its reasonable best efforts to cause all Registrable
Shares covered by such registration statement to be registered with or approved
by such other governmental agencies or authorities as may be necessary to enable
the Registering Holders to consummate the disposition of such Registrable
Shares;
(f) furnish to each Registering Holder and to each underwriter,
if any, a signed counterpart of: (i) an opinion of counsel for the Issuer
addressed to such Holder and underwriter on which opinion both Holder and such
underwriter are entitled to rely and (ii) a "comfort" letter signed by the
independent public accountants who have certified the Issuer's financial
statements included in such registration statement, each in customary form and
covering such matters of the type customarily covered by opinions or comfort
letters, as the case may be, as the managing underwriter therefor reasonably
request. The Issuer will use its commercially reasonable efforts to have such
comfort letters addressed to each Registering Holder;
(g) immediately notify each Registering Holder at any time when
a prospectus relating thereto is required to be delivered under the Securities
Act, upon discovery that, or upon the happening of any event as a result of
which, the prospectus included in such registration statement, as then in
effect, includes an untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances under which they were
made, and as promptly as practicable under the circumstances prepare and furnish
to such Registering Holder a reasonable number of copies of any supplement to or
amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such securities, such prospectus shall not
include an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make statements therein not
misleading in the light of the circumstances under which they were made;
(h) make available for inspection by any Registering Holder, any
underwriter participating in any disposition pursuant to such registration
statement and any attorney, accountant or other professional retained by any
such Holder or underwriter
13
(collectively, the "Inspectors"), all financial and other records, pertinent
----------
corporate documents and properties of the Issuer (collectively, the "Records")
-------
as shall be reasonably necessary to enable them to exercise their due diligence
responsibility, and shall cause (i) the Issuer's officers, directors and
employees to supply all information reasonably requested by any Inspectors and
(ii) the senior management of the Issuer and its Subsidiaries to participate in
any "road show" presentations to investors for such period of time as is
reasonably requested by the managing underwriters, in each case in connection
with such registration statement. Each such Holder agrees that information
obtained by it as a result of such inspections shall be deemed confidential and
shall not be used by it as the basis for any market transactions in the
securities of the Issuer or its Affiliates unless and until such information is
made generally available to the public. Each such Holder further agrees that it
will, upon learning that disclosure of such Records is sought in a court of
competent jurisdiction, give notice to the Issuer and allow the Issuer, at its
expense, to undertake appropriate action to prevent disclosure of the Records
deemed confidential;
(i) use its reasonable best efforts to list all Registrable
Shares covered by such registration statement on any securities exchange or
quotation system on which any of the Registrable Shares is then listed or
traded; and
(j) otherwise use its reasonable best efforts to comply with all
applicable rules and regulations of the Commission, and make available to its
security holders, as soon as reasonably practicable, an earnings statement or
such other document that shall satisfy the provisions of Section 11(a) of the
Securities Act and Rule 158 thereunder.
The Issuer may require each Registering Holder to promptly furnish to
the Issuer, as a condition precedent to including such Registering Holder's
Registrable Shares in any registration, such written information regarding such
Registering Holder and the distribution of such securities as the Issuer may
from time to time reasonably request in writing.
Each Holder agrees that upon receipt of any notice from the Issuer of
the happening of any event of the kind described in Section 3.03(g), such Holder
will forthwith discontinue such Holder's disposition of Registrable Shares
pursuant to the registration statement relating to such Registrable Shares until
such Holder's receipt of the copies of the supplemented or amended prospectus
contemplated by Section 3.03(g) and, if so directed by the Issuer, will deliver
to the Issuer (at the Issuer's expense) all copies, other than permanent file
copies, then in such Holder's possession, of the prospectus and any amendments
or supplements thereto relating to such Registrable Shares current at the time
of receipt of such notice. In the event the Issuer shall give such notice, the
Issuer shall extend the period during which the effectiveness of such
registration statement shall be maintained by the number of days during the
period from and including the date of the giving of notice pursuant to Section
3.03(g) to the date when the Issuer shall make available to the Holders a
prospectus supplemented or amended to conform with the requirements of Section
3.03(g).
1. Participation in Underwritten Registrations. No Person may
-----------------------------------------------
participate in any Public Offering pursuant to Section 3.01 or 3.02 unless such
Person (i) agrees to sell such Person's securities on the basis provided in any
underwriting arrangements approved by the Persons entitled hereunder to approve
such arrangements and (ii) completes and executes all questionnaires, powers of
attorney, indemnities, underwriting agreements and other documents
14
reasonably required under the terms of such underwriting arrangements; provided
that no holder of Registrable Shares included in any underwritten registration
shall be required to make any representations or warranties to the Issuer or the
underwriters (other than representations and warranties regarding such holder,
such holder's ownership and authority to transfer free of liens, claims and
encumbrances, and such holder's intended method of distribution) or to undertake
any indemnification obligations to the Issuer or the underwriters with respect
thereto, except as otherwise provided in Section 3.05(b).
1. Indemnification.
----------------
(a) Indemnification by the Issuer. The Issuer agrees to
-----------------------------
indemnify and hold harmless each Registering Holder, its officers, directors,
partners and agents and each Person, if any, who controls such Registering
Holder within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act from and against any and all losses, claims, damages,
liabilities or expenses (or actions or proceedings, whether commenced or
threatened in respect thereof), joint or several, arising out of or based upon
any untrue statement or alleged untrue statement of a material fact contained in
any registration statement, reports required and other documents filed under the
Exchange Act, prospectus or preliminary prospectus or any amendment thereof or
supplement thereto (together with any documents incorporated therein by
reference) relating to the Registrable Shares or caused by any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, or any violation or
alleged violation by Issuer of any federal, state, foreign or common law rule or
regulation and relating to action or inaction in connection with any such
registration, disclosure document or other document and the Issuer will
reimburse such Registering Holders, their officers, directors, partners and
agents and each Person, if any, who controls such Registering Holder within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act
for any legal or any other expenses reasonably incurred by them including any
amounts paid in any settlement in connection with investigating or defending
such loss, claim, damage, liability or expense, except insofar as such losses,
claims, damages, liabilities or expenses are caused by any such untrue statement
or omission or alleged untrue statement or omission based upon information
furnished in writing to the Issuer by such Registering Holder or on such
Registering Holder's behalf expressly for use therein. The Issuer also agrees to
indemnify any underwriters of the Registrable Shares, their officers and
directors and each Person who controls such underwriters on substantially the
same basis as that of the indemnification of the Registering Holders provided in
this Section 3.05(a).
(b) Indemnification by the Registering Holders. Each Registering
------------------------------------------
Holder agrees, severally but not jointly, to indemnify and hold harmless the
Issuer, its officers, directors and agents and each Person, if any, who controls
the Issuer within the meaning of either Section 15 of the Securities Act or
Section 20 of the Exchange Act to the same extent as the foregoing indemnity
from the Issuer to such Registering Holder, but only with respect to information
furnished in writing by such Registering Holder or on such Registering Holder's
behalf expressly for use in any registration statement or prospectus relating to
the Registrable Shares, or any amendment or supplement thereto, or any
preliminary prospectus. Each Registering Holder's obligation to indemnify
pursuant to this Section is several in the proportion that the proceeds of the
offering received by such Holder bears to the total proceeds of the offering
received by all the
15
Holders and not joint, and in any event shall be limited to the net cash
proceeds of the offering actually received by such Holder.
(c) 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
this Section 3.05, such Person (an "Indemnified Party") shall promptly notify
-----------------
the Person against whom such indemnity may be sought (the "Indemnifying Party")
------------------
in writing and the Indemnifying Party shall assume the defense thereof,
including the employment of counsel reasonably satisfactory to such Indemnified
Party, and shall assume the payment of all fees and expenses; provided that the
failure of any Indemnified Party so to notify the Indemnifying Party shall not
relieve the Indemnifying Party of its obligations hereunder except to the extent
that the Indemnifying Party is materially prejudiced by such failure to notify.
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) in the
reasonable judgment of such Indemnified Party 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 reasonable fees and expenses of more than one
separate firm of attorneys (in addition to any local counsel) at any time 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 the Indemnified
Party that had the largest number of Registrable Shares included in such
registration. The Indemnifying Party shall not be liable for any settlement of
any proceeding effected without its written consent, but if settled with such
consent, or if there be a final judgment for the plaintiff, the Indemnifying
Party shall indemnify and hold harmless such Indemnified Parties for and against
any loss or liability (to the extent stated above) by reason of such settlement
or judgment. 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 an unconditional release of such Indemnified
Party from all liability arising out of such proceeding.
2. Shelf Registration. Notwithstanding anything herein to the
------------------
contrary, if the Issuer prepares and files with the Commission a shelf
registration statement on an appropriate form relating to all (but not less than
all) of the Registrable Shares of the Holders in accordance with Rule 415 under
the Securities Act (the "Shelf Registration Statement"), the registration rights
----------------------------
of the Holders pursuant to Sections 3.01 and 3.02 shall be suspended for so long
as such Shelf Registration Statement is maintained continuously effective and in
compliance with the Securities Act and usable for resale of Registrable Shares.
The provisions set forth in Section 3.01(d), the last sentence of Section
3.02(a), Section 3.03, Section 3.04 and Section 3.05 shall, to the extent
relevant, apply to any such Shelf Registration Statement. In the event that the
Shelf Registration Statement is withdrawn or ceases to be effective for any
reason, the Holder's rights under Sections 3.01 and 3.02 shall be reinstated in
accordance with their original terms without any action by any party.
16
1. Holdback Agreements.
-------------------
(a) Each holder of Registrable Shares hereby agrees not to,
directly or indirectly, effect any public sale or distribution (including sales
pursuant to Rule 144) or any short sales of equity securities of the Issuer, or
any securities convertible into or exchangeable or exercisable for such
securities, during the seven days prior to and the 90 day period beginning on
the effective date of any Public Offering pursuant to Sections 3.01 or 3.02
hereof (except as part of such Public Offering), unless the underwriters
managing the Public Offering otherwise agree.
(b) The Issuer agrees not to effect any public sale or
distribution of its equity securities, or any securities convertible into or
exchangeable or exercisable for such securities, during the seven days prior to
and during the 90-day period beginning on the effective date of any underwritten
Public Offering pursuant to Sections 3.01 or 3.02 hereof (except as part of such
Public Offering or pursuant to registrations on Forms S-4 or S-8 or any
successor forms), unless the underwriters managing the Public Offering otherwise
agree.
2.
CORPORATE GOVERNANCE; COVENANTS
1. Board of Directors.
-------------------
(a) For so long as the Initial Holders hold an aggregate
number of Shares totaling at least 40% of the Initial Holdings, then the holders
of a majority of the outstanding Shares held by the Initial Holders shall be
entitled (i) to nominate two director nominees to the Board of Directors (each,
a "Preferred Share Director") and (ii) to nominate at least one Preferred Share
-------------------------
Director to each committee or subcommittee of the Board of Directors. If at any
time the Initial Holders hold an aggregate number of Shares totaling less than
40% of the Initial Holdings, but for so long as they hold an aggregate number of
Shares totaling at least 10% of the Initial Holdings, the holders of a majority
of the outstanding Shares held by the Initial Holders shall be entitled to
nominate one Preferred Share Director and to nominate such Preferred Share
Director to each committee or subcommittee of the Board of Directors. The Issuer
agrees to use its best efforts to take all actions necessary to have such
director nominees elected to the Board of Directors and appointed to such
committees and subcommittees, including nominating such designee, including the
designee in the Issuer's proxy statement, recommending a vote for such designee
and casting proxies given to the Issuer in favor of such designee. If the
Initial Holders for any reason fail to nominate anyone to fill any such
directorship, such position shall remain vacant until such time as the Initial
Holders nominate a director to fill such position and such directorship shall
not be filled by resolution or vote of the Issuer's Board of Directors or the
Issuer's other stockholders. At least two Business Days prior to any nomination
of a Preferred Share Director, the Initial Holders shall notify the Issuer, the
Issuer's Chief Executive Officer or the Issuer's Chairman of the Board of
Directors of the identity of such Preferred Share Director. The Initial Holders
shall permit the Issuer to consult with them regarding such nominee; provided,
that nothing herein shall confer on the Issuer any approval, consent or veto
right with respect to such nominee and the Initial Holders shall retain the
right to nominate any person they choose. For purposes of this Section 4.01(a),
"a majority of the outstanding Shares held by the Initial Holders" shall mean a
majority of the votes represented by the Common Shares and Preferred Shares held
by the Initial Holders, counting each Common Share as one vote and each
17
Preferred Share as a number of votes equal to the number of Common Shares into
which such Preferred Share could convert.
(b) For so long as the Initial Holders are entitled to elect at
least one director, the Issuer shall use its best efforts to ensure that there
are no more than 11 members of the Board of Directors.
(c) The Issuer hereby agrees to take, or cause to be taken, all
reasonable actions and to do, or cause to be done, all reasonable things
necessary to give effect to the rights of the Initial Holders hereunder.
(d) The directors nominated pursuant to Section 4.01(a) shall be
entitled to receive the same compensation and benefits (including equity-based
compensation) that are provided to the other non-executive members of the Board
of Directors.
(e) For so long as the Initial Holders hereunder retain their
right to nominate directors pursuant to Section 4.01(a), the Issuer shall
maintain policies of directors and officers liability insurance, with
financially sound and reputable insurers, having terms that are customary for
companies similarly situated.
(f) The provisions contained in this Section 4.01 are intended
to operate in conjunction with the provisions contained in paragraph 6(b) of the
Issuer's Articles of Amendment for the Series B Shares (the "Articles of
-----------
Amendment"), such that: (i) at any time when the holders of the Series B Shares
---------
are entitled to elect two directors pursuant to the Articles of Amendment, then
the Initial Holders shall not have a separate right to nominate directors
pursuant to the provisions of this Section 4.01; (ii) at any time when the
holders of the Series B Shares are entitled to elect only one director pursuant
to the Articles of Amendment, then, if pursuant to the provisions of this
Section 4.01 (disregarding the Articles of Amendment) the Initial Holders would
be entitled to nominate two Preferred Share Directors, then the Initial Holders
shall be entitled to nominate one Preferred Share Director pursuant to this
Section 4.01; and (iii) at any time when the holders of the Series B Shares are
not entitled to elect any directors pursuant to the Articles of Amendment, then
the provisions of this Section 4.01 shall apply in their entirety without regard
to this subsection (f).
2. Voting. Unless the requisite holders of the Common Shares have
----------
approved a higher level of voting, so long as WCAS or any of its Affiliates own
any Preferred Shares, the maximum number of votes which WCAS shall be
entitled to cast (on any matter requiring the vote of the holders of the Common
Shares) shall not exceed the number of votes equal to 19.9% of the number of
votes that are entitled to be cast by all holders of the Company's Voting
Securities entitled to vote on any particular matter, notwithstanding the number
of votes otherwise represented by the Preferred Shares and other Voting
Securities of the Company held by WCAS and its Affiliates. Unless the requisite
holders of the Common Shares have approved a higher level of voting, any votes
with respect to Voting Securities in excess of the 19.9% specified in the
sentence above will be voted proportionately with the shares held by the
Issuer's public shareholders (i.e., persons who are not either affiliates (as
defined in Rule 13e-3 under the Exchange Act) or 5% owners of the Voting
Securities of the Issuer). The Issuer will cooperate with WCAS and its
Affiliates and will take all steps necessary to ensure that the votes of WCAS
and its Affiliates are cast in compliance with this section.
18
3.
STANDSTILL
1. Acquisition of Voting Securities/Board Control.
-----------------------------------------------
(a) Each Holder agrees that, except for the Warrants
issued pursuant to the Series B Purchase Agreement and the Warrants issued to
WCAS Capital Partners III, L.P. in connection with the $95,000,000 13 1/2%
Subordinated Notes due 2011 (and any Common Shares issued upon exercise of such
Warrants), and any other equity securities of the Issuer that can be acquired in
connection with the commitment to provide debt financing, or the funding
thereof, for the transactions contemplated in the Series C Purchase Agreement,
until the tenth anniversary of the date hereof, such Holder and its Affiliates
will not, directly or indirectly (including through any controlled entity), (i)
purchase or otherwise acquire, or agree or offer to purchase or otherwise
acquire, ownership (including, without limitation, beneficial ownership) of any
voting securities of the Issuer, any direct or indirect rights or options to
acquire voting securities, any assets or business of the Issuer or any bank
debt, claims or other obligations of the Issuer or any options to acquire such
ownership (including from a third party) without the Issuer's prior written
consent, except for the Preferred Shares and the Common Shares into which such
Preferred Shares are convertible; (ii) solicit, or participate in the
solicitation of, any proxies or consents with respect to any securities of the
Issuer, or make any public announcement with respect to any of the foregoing or
request permission to do any of the foregoing; (iii) make any public
announcement with respect to, or submit a proposal for, or offer of (with or
without conditions) any extraordinary transaction involving the Issuer or its
securities or assets; (iv) enter into any discussions, negotiations,
arrangements or understandings with any third party with respect to any of the
foregoing, or otherwise form, join or in any way participate in a "group" in
connection with any of the foregoing; or (v) participate in any effort to do any
of the foregoing or make any public announcement with respect to the foregoing.
For purposes of this Section 5.01, "controlled entity" shall mean, with respect
to any Person, any entity in which such Person owns the majority of the voting
securities or has the ability (whether through the ownership of voting
securities, contract or otherwise) to elect a majority of the board of directors
or other similar governing body or has the authority to control or direct the
investment decisions of such entity. Nothing in this Section 5.01 shall limit
the activities of any Affiliate of Xxxxxx Xxxxxxx Incorporated (other than any
Holder) that is (1) a broker/dealer, (2) an affiliate of a broker/dealer
involved in financing, securities, commodities or derivatives activities in the
ordinary course of business, (3) a registered investment adviser, (4) an
investment company, whether registered or unregistered, or (5) a portfolio
company of any such investment company, unless the persons conducting business
on behalf of such Affiliate had access to material non-public information with
respect to the Issuer.
(b) Notwithstanding anything to the contrary herein, the
parties hereto agree that the provisions of this Section 5.01 shall apply only
to the Holders, their Affiliates and their controlled entities and not to any of
their partners, members, securityholders, or portfolio companies (that are not
controlled entities) that are not otherwise a holder of Shares and a Holder
under this Agreement.
4.
MISCELLANEOUS
19
1. Headings. The headings in this Agreement are for convenience of
-----------
reference only and shall not control or affect the meaning or construction of
any provisions hereof.
1. No Inconsistent Agreements. The Issuer will not hereafter enter
-----------------------------
into or amend any agreement with respect to its securities which prevents the
Issuer from discharging its obligations under this Agreement or grant rights
superior to the rights granted to the Holders in this Agreement.
1. Entire Agreement. The Transaction Agreements constitute the entire
-------------------
agreement and understanding of the parties hereto and thereto in respect of the
subject matter contained herein and therein, and there are no restrictions,
promises, representations, warranties, covenants, or undertakings with respect
to the subject matter hereof or thereof, other than those expressly set forth or
referred to herein or therein. The Transaction Agreements supersede all prior
agreements and understandings between the parties hereto and thereto with
respect to the subject matter hereof and thereof. This Agreement supersedes the
Original Shareholder Agreement.
1. Notices. All notices, requests and other communications to any
----------
party hereunder shall be in writing (including telecopier) and shall be deemed
to have been duly given or made if sent by telecopy, delivered personally or
sent by registered or certified mail (postage prepaid, return receipt requested)
to such party at its address or telecopier number set forth on the signature
pages hereof, or such other address or telecopier number as such party may
hereinafter specify for the purpose to the party giving such notice. All such
notices, requests and other communications shall be deemed received on the date
of receipt by the recipient thereof if received prior to 5:00 p.m. in the place
of receipt and such day is a Business Day in the place of receipt. Otherwise,
any such notice, request or communication shall be deemed not to have been
received until the next succeeding Business Day in the place of receipt.
1. Applicable Law; Submission to Jurisdiction. The corporate law of
----------------------------------------------
the Commonwealth of Virginia shall govern all issues and questions concerning
the relative rights and obligations of the Issuer and its stockholders. All
other issues and questions concerning the construction, validity, enforcement
and interpretation of this Agreement shall be construed in accordance with and
governed by the laws of the State of New York, without giving effect to any
choice of law or conflict of law rules or provisions (whether of the State of
New York or any other jurisdiction) that would cause the application of the laws
of any jurisdiction other than the State of New York. Without limiting the
foregoing and subject to applicable law, each party agrees that service of
process on such party as provided in Section 6.04 shall be deemed effective
service of process on such party. Nothing herein shall affect the right of any
party to serve legal process in any other manner permitted by law or at equity
or to enforce in any lawful manner a judgment obtained in one jurisdiction in
any other jurisdiction. WITH RESPECT TO A PROCEEDING IN ANY SUCH COURT, EACH OF
THE PARTIES IRREVOCABLY WAIVES AND RELEASES TO THE OTHER ITS RIGHT TO A TRIAL BY
JURY, AND AGREES THAT IT WILL NOT SEEK A TRIAL BY JURY IN ANY SUCH PROCEEDING.
20
1. Severability. The invalidity or unenforceability of any
----------------
provisions of this Agreement in any jurisdiction shall not affect the validity,
legality or enforceability of the remainder of this Agreement in such
jurisdiction or the validity, legality or enforceability of this Agreement,
including any such provision, in any other jurisdiction, it being intended that
all rights and obligations of the parties hereunder shall be enforceable to the
fullest extent permitted by law.
1. Successors, Assigns, Transferees. The provisions of this
------------------------------------
Agreement shall be binding upon and accrue to the benefit of the parties hereto
and their respective heirs, executors, administrators, successors and permitted
assigns. Notwithstanding the foregoing, neither this Agreement nor any right,
remedy, obligation or liability arising hereunder or by reason hereof shall be
assignable by the Issuer or any Holder, except (i) as specifically provided
pursuant to the terms hereof and (ii) in connection with a Transfer of
securities of the Issuer described in Section 2.02 and otherwise permitted
pursuant to the terms hereof. Nothing in this Agreement, expressed or implied,
is intended to confer on any Person other than the parties hereto, and their
respective successors and permitted assigns, any rights, remedies, obligations
or liabilities under or by reason of this Agreement.
1. Amendments; Waivers.
-----------------------
(a) No failure or delay on the part of 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) Any provision of this Agreement may be amended or waived
if, but only if, such amendment or waiver is in writing and is signed, in the
case of an amendment, by the parties hereto, or in the case of a waiver, by the
party against whom the waiver is to be effective.
2. Counterparts. This Agreement may be executed in any number of
----------------
counterparts, each of which shall be an original with the same effect as if the
signatures thereto and hereto were upon the same instrument.
1. Recapitalization, etc. In the event that any capital stock or
------------------------
other securities are issued in respect of, in exchange for, or in substitution
of, any Shares by reason of any reorganization, recapitalization,
reclassification, merger, consolidation, spin-off, partial or complete
liquidation, stock dividend, split-up, sale of assets, distribution to
stockholders or combination of the Shares or any other change in capital
structure of the Issuer, appropriate adjustments shall be made with respect to
the relevant provisions of this Agreement so as to fairly and equitably
preserve, as far as practicable, the original rights and obligations of the
parties hereto under this Agreement.
1. Remedies. The parties hereto acknowledge and agree that in the
-----------
event of any breach of this Agreement, the parties would be irreparably harmed
and could not be made whole by monetary damages. Each party hereto accordingly
agrees (i) not to assert by way of defense
21
or otherwise that a remedy at law would be adequate, and (ii) that the parties
agree, in addition to any other remedy to which they may be entitled, that the
remedy of specific performance of this Agreement is appropriate in any action in
court.
1.Reasonable Best Efforts. Subject to the terms and conditions of
-------------------------
this Agreement, the Issuer and each of the Holders will use its reasonable best
efforts to take, or cause to be taken, all actions and to do, or cause to be
done, all things necessary or desirable under applicable laws and regulations to
give effect to the terms and conditions of the Transaction Agreements.
* * * * *
22
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the date first above written.
CFW COMMUNICATIONS COMPANY
By: _________________________________
Name:
Title:
Address for notices:
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CFW Communications Company
000 Xxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxxx Xxxxxxx
With a copy to:
Hunton & Xxxxxxxx
Bank of America Plaza
Suite 4100
000 Xxxxxxxxx Xxxxxx, XX
Xxxxxxx, XX 00000-0000
Facsimile: (000) 000-0000
Attention: Xxxxx Xxxxxx, Esq.
WELSH, CARSON, XXXXXXXX
& XXXXX VIII, L.P.
By: WCAS VIII Associates, LLC,
as General Partner
By: ____________________________________
Name:
Title: Managing Member
Address for notices:
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000 Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxxx X. Rather
with a copy to:
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Xxxxxxxx & Xxxxx
Citigroup Center
000 Xxxx 00/xx/ Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxx Xxxxxxxxx, Esq.
WELSH, CARSON, XXXXXXXX
& XXXXX IX, L.P.
By: WCAS IX Associates, LLC,
as General Partner
By: _______________________________
Name:
Title: Managing Member
Address for notices:
----------------------
000 Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxxx X. Rather
with a copy to:
--------------
Xxxxxxxx & Xxxxx
Citigroup Center
000 Xxxx 00/xx/ Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxx Xxxxxxxxx, Esq.
WCAS CAPITAL PARTNERS III, L.P.
By: WCAS CP III Associates, L.L.C., its
general partner
By: ______________________________________
Name:
Title: Managing Member
Address for notices:
-----------------------
000 Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxxx X. Rather
with a copy to:
--------------
Xxxxxxxx & Xxxxx
Citigroup Center
000 Xxxx 00/xx/ Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxx Xxxxxxxxx, Esq.
XXXXXX XXXXXXX XXXX XXXXXX EQUITY
FUNDING, INC.
By: _______________________________
Name:
Title:
Address for notices:
-----------------------
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Facsimile:
Attention:
By: _______________________________
Name: Xxxxxxxx X. Rather
as Attorney-in-fact for the individual
investors listed below:
Xxxxxxx X. Xxxxx
Xxxxxxx X. Xxxxxx
Xxxxx X. Xxxxxxxx
Xxxxxx X. Xxxx
Xxxxxx X. XxXxxxxxx
Xxxxxx X. Xxxxxxxxx
Xxxxxxxx X. Xxxxxx
Xxxxxxx X. xx Xxxxxx
Xxxx X. Xxxxxxx
Xxxxxxx X. Xxxxxx
Xxxxxxxx X. Rather
D. Xxxxx Xxxxxxx
Xxxxxx Xxxxx
Xxxx X. Xxxxx
Xxxx X. Xxxxxxx
Xxxx Xxxxxxx
Xxxx X Xxx
Address for notices:
-----------------------
c/o Welsh, Carson, Xxxxxxxx & Xxxxx
000 Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxxx X. Rather
with a copy to:
--------------
Xxxxxxxx & Xxxxx
Citigroup Center
000 Xxxx 00/xx/ Xxxxxx
Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000
Attention: Xxxxxxx Xxxxxxxxx, Esq.
EXHIBIT A
FORM OF AGREEMENT TO BE BOUND
[Date]
To the Parties to the Shareholders
Agreement dated as of July 11, 2000
Ladies and Gentlemen:
Reference is made to the Shareholders Agreement dated as of July 11,
2000 (the "Shareholders Agreement") among CFW Communications Company, a Virginia
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corporation, Welsh, Carson, Xxxxxxxx & Xxxxx VIII, L.P., a Delaware limited
partnership, and the other Persons listed on the signature pages thereof and
each other Person who has or shall become a party to the Shareholders Agreement
as provided therein. Capitalized terms used herein and not defined have the
meanings ascribed to them in the Shareholders Agreement to the same extent and
in the same manner as the assignor.
In consideration of the covenants and agreements contained in the
Shareholders Agreement, the undersigned hereby confirms and agrees that it shall
be bound as a "Holder" by all of the provisions of the Shareholders Agreement.
This letter shall be construed and enforced in accordance with the
internal laws of the State of New York.
Very truly yours,
