EXHIBIT 4.12
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CDW HOLDING CORPORATION
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REGISTRATION AND PARTICIPATION AGREEMENT
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Dated as of February 28, 1994
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TABLE OF CONTENTS
(Not Part of Agreement)
Page
1. Background.................................................1
2. Definitions................................................3
3. Registration...............................................9
3.1. Registration on Request..............................9
(a) Requests other than by Westinghouse..............9
(b) Request by Westinghouse.........................10
(c) Obligation to Effect Registration...............10
(d) Registration Statement Form.....................11
(e) Expenses........................................12
(f) Inclusion of Other Securities...................13
(g) Effective Registration Statement................13
(h) Pro Rata Allocation.............................13
3.2. Incidental Registration.............................14
3.3. Registration Procedures.............................17
3.4. Underwritten Offerings..............................23
(a) Underwritten Offerings Exclusive................23
(b) Underwriting Agreement..........................23
(c) Selection of Underwriters.......................24
(d) Incidental Underwritten Offerings...............25
(e) Hold Back Agreements............................25
(f) Notice of Impending Effective Date..............26
3.5. Preparation; Reasonable Investigation...............26
3.6. Other Registrations.................................27
3.7. Indemnification.....................................27
(a) Indemnification by the Company..................27
(b) Indemnification by the Sellers..................29
(c) Notices of Claims, etc..........................30
(d) Other Indemnification...........................31
(e) Other Remedies..................................31
(f) Officers and Directors..........................32
4. Participation Rights......................................32
(a) Procedures for Qualifying Sales.................32
(b) Qualifying Sale Defined.........................34
5. Investors' Rights to Purchase Additional
Capital Stock.............................................34
5.1. C&D Sale............................................34
5.2. Offer Procedures....................................35
(a) Procedures......................................35
(b) Allocated Amount Defined........................36
(c) Terms of Offer..................................37
(d) Election as to Form of Consideration............38
6. Designation of Directors by the C&D Fund..................39
7. Miscellaneous.............................................41
7.1. Rule 144; Legended Securities; etc..................41
7.2. Amendments and Waivers..............................42
7.3. Nominees for Beneficial Owners......................43
7.4. Successors, Assigns and Transferees.................43
7.5. Notices.............................................44
II
REGISTRATION AND PARTICIPATION AGREEMENT
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REGISTRATION AND PARTICIPATION AGREEMENT, dated as of February 28,
1994, among CDW Holding Corporation, a Delaware corporation (the "Company"), and
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the undersigned parties hereto.
1. Background. (a) The Company is a party to an Asset Acquisition
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Agreement, dated as of February 15, 1994 (the "Acquisition Agreement"), with
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Westinghouse Electric Corporation, a Pennsylvania corporation ("Westinghouse").
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(b) In connection with the transactions contemplated by the
Acquisition Agreement, the Company is a party to (i) a Stock Subscription
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Agreement, dated as of the date hereof (the "Fund Stock Subscription
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Agreement"), between the Company and The Xxxxxxx & Dubilier Private Equity Fund
IV Limited Partnership, a Connecticut limited partnership (the "C&D Fund"),
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pursuant to which the Company has agreed to issue 833,280 shares of Class A
Common Stock (as this term and other capitalized terms used herein are defined
in Section 2) to the C&D Fund, (ii) a Management Stock Subscription Agreement,
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dated as of the date hereof (the "Management Stock Subscription Agreement"),
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between the Company and one of its executive officers (the "Management
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Purchaser"), pursuant to which the Company has agreed to issue an aggregate of
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16,720 shares of Class A Common Stock to the Management Purchaser, (iii) a
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Management Stock Option Agreement, dated as of the date hereof (the "Management
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Stock Option Agreement"), between the Company and the Management Purchaser,
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covering options to acquire up to an aggregate of 22,280 shares of Class A
Common Stock, and (iv) a Capital Call Agreement, dated as of the date hereof
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(the "Capital Call Agreement"), among the Company, Barclays Business Credit,
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Inc. and the C&D Fund, pursuant to which the Company has agreed to issue, under
certain circumstances, up to 50,000 shares of Class A Common Stock to the C&D
Fund.
(c) Pursuant to the Acquisition Agreement, the Company is a party to
a Stock Subscription, Stock Option and Stockholders Agreement, dated as of the
date hereof (the "Westinghouse Stock Subscription and Stock Option Agreement"),
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among the Company, Westinghouse and the C&D Fund, pursuant to which the Company
has agreed, in partial payment of the U.S. Purchase Price (as defined in the
Acquisition Agreement), to (i) issue to Westinghouse 100,000 shares of Class A
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Common Stock and (ii) grant to Westinghouse an option (the "Option") to
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purchase 100,000 shares of Class A Common Stock.
(d) The Company or the C&D Fund may in the future issue or sell
directly, or pursuant to options or other rights, additional shares of Class A
Common Stock to certain directors, executive officers and key employees of the
Company or one of its Subsidiaries (the "Subsequent Management Purchasers"),
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and additional shares of Class A Common Stock to certain Individual Investors or
other purchasers (the "Subsequent Purchasers"), in each case, pursuant to stock
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subscription or purchase agreements the terms of which are not inconsistent with
the terms of this Agreement (the "Subsequent Stock Subscription Agreements") or
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stock option or rights agreements, plans or arrangements the terms of which are
not inconsistent with the terms of this Agreement (the "Subsequent Stock Option
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Agreements").
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(e) The Management Purchaser and the Subsequent Management Purchasers
and any trusts holding shares of Class A Common Stock or options to purchase
shares of Class A Common Stock for the benefit of relatives or dependents of the
Management Purchaser or any Subsequent Management Purchaser are referred to
herein collectively as the "Management Stockholders". The Fund Stock
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Subscription Agreement, the Management Stock Subscription Agreement, the
Management Stock Option Agreement, the Capital Call Agreement, the Westinghouse
Stock Subscription and Stock Option Agreement, the Subsequent Stock Subscription
Agreements and the Subsequent Stock Option Agreements are referred to herein
collectively as the "Stock Subscription Agreements".
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2. Definitions. For purposes of this Agreement,
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the following terms have the following respective meanings:
"Accepting Holder": See Section 5.2(a).
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"Acquisition Agreement": See Section 1.
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"Affiliate": With respect to any Person, any other Person that
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directly, or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, the first Person. "Control"
(including the terms "controlled by" and "under common control with") means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management policies of a person, whether through the ownership
of voting securities, by contract or credit arrangement, as trustee or executor,
or otherwise. The C&D Fund and the Company shall be deemed not to be Affiliates
of Westinghouse. Any director, member of management or other employee of the
Company or any of its Subsidiaries who would not otherwise be an Affiliate of
the C&D Fund shall not be deemed to be an Affiliate of the C&D Fund.
"Allocated Amount": See Section 5.2(b).
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"Allocation Calculation": See Section 5.2(b).
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"Business Day": A day other than a Saturday, Sunday or other day on
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which commercial banks in New York City are authorized or required to close.
"C&D Fund": See Section 1.
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"C&D Offeree": See Section 5.1.
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"C&D Sale": See Section 5.1.
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"CD&R": Xxxxxxx, Dubilier & Rice, Inc., a Delaware corporation.
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"Capital Call Agreement": See Section 1.
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"Class A Common Stock": The Class A Common Stock,
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par value $.01 per share, of the Company.
"Class B Common Stock": The Class B Common Stock,
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par value $.01 per share, of the Company.
"Common Stock": The Class A Common Stock and the
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Class B Common Stock.
"Company": See the introduction to this Agreement.
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"Eligible Holder": See Section 5.1.
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"Exchange Act": The Securities Exchange Act of 1934, as amended, or
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any successor Federal statute, and the rules and regulations thereunder which
shall be in effect at the time. Any reference to a particular section thereof
shall include a reference to the corresponding section, if any, of any such
successor Federal statute, and the rules and regulations thereunder.
"Fund Stock Subscription Agreement": See Section 1.
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"Individual Investors": Directors or senior executives of
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corporations in which entities managed or sponsored by CD&R have made
substantial equity investments.
"Initial Public Offering": The consummation of a bona fide public
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offering of Common Stock pursuant to a registration statement filed under the
Securities Act, which offering is underwritten on a firm commitment basis by a
syndicate of underwriters led by one or more underwriters at least one of which
is an underwriter of recognized national standing.
"Management Purchaser": See Section 1.
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"Management Stockholders": See Section 1.
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"Management Stock Option Agreement": See Section 1.
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"Management Stock Subscription Agreement": See Section 1.
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"NASD": National Association of Securities Dealers, Inc.
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"NASDAQ": The NASD Automated Quotation System.
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"Newco": CDW Acquisition Corporation, a Delaware corporation and
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wholly owned subsidiary of the Company.
"Offer": See Section 5.1.
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"Offered Securities": See Section 5.2(a).
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"Option": See Section 1(c).
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"Participants": See Section 5.2(b).
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"Person": Any natural person, firm, partnership, association,
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corporation, company, trust, business trust, governmental entity or other
entity.
"Proportionate First Share": See Section 5.2(b).
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"Proportionate Subsequent Share": See Section 5.2(b).
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"Qualifying Sale": See Section 4(b).
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"Qualifying Securities": See Section 4(a).
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"Registrable Securities": (a) Any Class A Common Stock or Class B
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Common Stock issued pursuant to the Stock Subscription Agreements (including
upon exercise of options
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granted pursuant to the Management Stock Option Agreement, the Subsequent Stock
Option Agreements or the Westinghouse Stock Subscription and Stock Option
Agreement), only if, in the case of the issuance pursuant to any Stock
Subscription Agreement, such Stock Subscription Agreement provides that such
Common Stock shall be entitled to the benefits of this Agreement applicable to
Registrable Securities, (b) any Class A Common Stock issued upon conversion of
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the Class B Common Stock referred to in clause (a) above, (c) any Class B Common
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Stock issued in exchange for the Class A Common Stock referred to in clause (a)
or (b) above, (d) any equity securities of the Company issued pursuant to the
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terms of, and under the circumstances set forth in, Section 5, and (e) any
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securities issued or issuable with re spect to any equity securities of the
Company referred to in the foregoing clauses (i) upon any conversion or exchange
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thereof, (ii) by way of stock dividend or stock split, (iii) in connection with
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a combination of shares, recapital ization, merger, consolidation or other
reorganization or (iv) otherwise, in all cases subject to the last paragraph of
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Section 3.3. As to any particular Registrable Securities, once issued such
securities shall cease to be Registrable Securities when (A) a registration
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statement (other than a Special Registration pursuant to which such securities
were issued by the Company) with respect to the sale of such securities shall
have become effective under the Securities Act and such securities shall have
been disposed of in accordance with such registration statement, (B) such
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securities shall have been distributed to the public in reliance upon Rule 144,
(C) subject to the provisions of the second paragraph of Section 7.1, such
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securities shall have been otherwise transferred, new certificates for such
securities not bearing a legend restricting further transfer shall have been
delivered by the Company and subsequent disposition of such securities shall not
require registration or qualification of such securities under the Securities
Act or any similar state law then in force or (D) such securities shall have
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ceased to be outstanding. Subject to the immediately preceding sentence,
Registrable Securities shall not cease to be Registrable Securities upon
transfer.
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"Registration Expenses": All expenses incident to the Company's
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performance of its obligations under or compliance with Section 3, including,
but not limited to, all registration and filing fees, all fees and expenses of
complying with securities or blue sky laws, all fees and expenses associated
with listing securities on exchanges or NASDAQ, all fees and other expenses
associated with filings with the NASD (including, if required, the fees and
expenses of any "qualified independent underwriter" and its counsel), all
printing expenses, the fees and disbursements of counsel for the Company and of
its independent public accountants, and the expenses of any special audits made
by such account ants required by or incidental to such performance and
compliance, but not including (a) fees and disbursements of counsel retained by
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the holders of Registrable Securities or (b) any underwriting discounts or
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commissions or any trans fer taxes payable in respect of the sale of Registrable
Securities by the holders thereof.
"Requisite Percentage of Stockholders": At any time prior to an
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Initial Public Offering, the holder or holders (other than Westinghouse and its
successors and permitted assigns) of at least 50% (by number of shares) of the
Registrable Securities at the time outstanding; there after, the holder or
holders (other than Westinghouse and its successors and permitted assigns) of at
least 20% (by number of shares) of the Registrable Securities at the time
outstanding.
"Rule 144": Rule 144 (or any successor provision) under the
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Securities Act.
"Rule 144A": Rule 144A (or any successor provision) under the
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Securities Act.
"Sale Notice": See Section 4(a).
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"Securities Act": The Securities Act of 1933, as amended, or any
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successor Federal statute, and the rules and regulations thereunder which shall
be in effect at the time.
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Any reference to a particular section thereof shall include a reference to the
corresponding section, if any, of any such successor Federal statute, and the
rules and regulations thereunder.
"Securities and Exchange Commission": The Securities and Exchange
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Commission or any other Federal agency at the time administering the Securities
Act or the Exchange Act.
"Special Registration": The registration of shares of equity
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securities and/or options or other rights in respect thereof (a) to be offered
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to directors, members of management, employees or sales agents, distributors or
similar representatives of the Company or its Subsidiaries, (b) concerning or
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relating to shares of Class A Common Stock to be offered to Individual Investors
or (c) made solely on Form S-4 or S-8 or any successor form.
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"Specified Public Offering": The consummation of any offering of
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Common Stock pursuant to a registration statement filed under the Securities
Act, which offering is underwritten by a syndicate of underwriters led by one or
more underwriters at least one of which is an underwriter of recognized national
standing, which represents a bona fide offering to the public and which
(together with any prior registered offerings) results in (a) an aggregate
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percentage of the outstanding Common Stock (on a fully diluted basis) being held
by the public (it being agreed that no party hereto who holds more than 5% of
the outstanding Common Stock (on a fully diluted basis) constitutes a member of
the public) that is greater than the percentage of the outstanding Common
Stock (on a fully diluted basis) held by Westinghouse upon, and after giving
effect to, the consummation of such offering, and (b) the Company being subject
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to the reporting requirements of Section 13 of the Exchange Act other than by
reason solely of Section 15(d) of the Exchange Act.
"Specified Securities": See Section 4(a).
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"Stock Subscription Agreements": See Section 1.
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"Subscribed Amount": See Section 5.2(a).
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"Subsequent Management Purchasers": See Section 1.
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"Subsequent Purchasers": See Section 1.
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"Subsequent Stock Option Agreements": See Section 1.
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"Subsequent Stock Subscription Agreements": See Section 1.
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"Subsidiary": Each corporation or other Person in which a person owns
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or controls, directly or indirectly, capital stock or other equity interests
representing at least 50% of the outstanding voting stock or other equity
interests.
"Westinghouse": See Section 1.
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"Westinghouse Stock Subscription and Stock Option
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Agreement": See Section 1.
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3. Registration.
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3.1. Registration on Request.
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(a) Requests other than by Westinghouse. Subject to the provisions
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of Section 3.6, at any time or from time to time the Requisite Percentage of
Stockholders shall have the right to make one or more written requests that the
Company effect the registration under the Securities Act of all or part of the
Registrable Securities of the holder or holders making such request, which
requests shall specify the intended method of disposition thereof by such holder
or holders.
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(b) Request by Westinghouse. Subject to the provisions of Section
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3.6, at any time after the fifth anniversary of the date hereof Westinghouse
(or a permitted assignee to which Westinghouse has transferred all or a
portion of its rights under this Section 3.1(b)) shall have the right to make
two written requests that the Company effect the registration under the
Securities Act of all or part of the Registrable Securities owned by
Westinghouse (or such assignee), which requests shall specify the intended
method of disposition thereof by Westinghouse (or such assignee).
(c) Obligation to Effect Registration. Upon receipt by the Company
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of any request for registration pursuant to Section 3.1(a) or 3.1(b), the
Company will promptly give written notice of such requested registration to all
holders of Registrable Securities, and thereupon will use its best efforts to
effect the registration under the Securities Act of
(i) the Registrable Securities which the Company has been so
requested to register pursuant to Section 3.1(a) or 3.1(b), as the case
may be, and
(ii) all other Registrable Securities which the Company has been
requested to register by the holders thereof by written request given to
the Company within 30 days after the Company has given such written notice
(which request shall specify the intended method of disposition of such
Registrable Securities),
all to the extent required to permit the disposition (in accordance with the
intended methods thereof as aforesaid) of the Registrable Securities so to be
registered. Notwithstanding the preceding sentence:
(A) the Company shall not be required to effect a registration
requested pursuant to Section 3.1(a) if the aggregate number of Registrable
Securities referred to in clauses (i) and (ii) of the preceding sentence to
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be included in such registration shall be less than 20% of the Registrable
Securities at the time outstanding;
(B) the Company shall not include in any regis tration requested
pursuant to Section 3.1(b) any Regis trable Securities of any holder
(other than a holder entitled to make a request under Section 3.1(b)) who
was not a stockholder of the Company on the date of this Agreement; and
(C) if the Board of Directors of the Company determines in its good
faith judgment, after consultation with a firm of nationally recognized
underwriters, that there will be an adverse effect on a then contemplated
Initial Public Offering unless such Initial Public Offering is not made
contemporaneously with a registration pursuant to Section 3.1(a) or
3.1(b), each holder of Registrable Securities to be included pursuant to
this Section 3.1(c) in a requested registration shall be given notice of
such fact and the holder or holders of Registrable Securities initiating
such request for registration pursuant to Section 3.1(a) or 3.1(b), as the
case may be, shall be deemed to have withdrawn such request and such
registration shall not be deemed to have been effected pursuant to this
Section 3.1, provided that the Company may not exercise its rights under
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this clause (C) with respect to a request pursuant to Section 3.1(b) if
the Company has exercised its rights under this clause (C) with respect to
such a request made more than 180 days, but less than 15 months, prior to
such request.
(d) Registration Statement Form. Each registration requested
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pursuant to this Section 3.1 shall be effected by the filing of a registration
statement on Form S-1, Form S-2 or Form S-3 (or any other form which includes
substantially the same information as would be required to be included in a
registration statement on such forms as presently constituted), unless the use
of a different form is (i) required by law or (ii) permitted by law and agreed
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to
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in writing by holders holding at least a majority (by number of shares) of the
Registrable Securities as to which registration has been requested pursuant to
this Section 3.1. At any time after the Company has issued and sold any shares
of its capital stock registered under an effective registration statement under
the Securities Act, or after the Company shall have registered any class of
equity securities pursuant to Section 12 of the Exchange Act, it will use its
best efforts to qualify for registration on Form S-2 or Form S-3 (or any other
comparable form hereinafter adopted).
(e) Expenses. The Company will pay all Registration Expenses in
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connection with (i) the first three registrations effected pursuant to a
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request under Section 3.1(a) and (ii) the two registrations effected pursuant to
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a request under Section 3.1(b). The Registration Expenses in connection with
each other registration, if any, requested under Section 3.1(a) shall be
apportioned among the holders whose Registrable Securities are then being
registered, on the basis of the respective amounts (by number of shares) of
Registrable Securities then being registered, provided that any such
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Registration Expenses so apportioned to Westinghouse will be paid by the
Company. However, in the case of each registration requested under Section
3.1(a) or 3.1(b), the Company shall pay all amounts in respect of (A) any
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allocation of salaries of personnel of the Company and its Subsidiaries or other
general overhead expenses of the Company and its Subsidiaries or other
expenses for the preparation of financial statements or other data normally
prepared by the Company and its Subsidiaries in the ordinary course of its
business, (B) the expenses of any officers' and directors' liability insurance,
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(C) the expenses and fees for listing the securities to be registered on each
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exchange on which similar securities issued by the Company are then listed or,
if no such securities are then listed, on an exchange selected by the Company or
on NASDAQ and (D) all fees associated with filings required to be made with the
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NASD (including, if required, the fees and expenses of any "qualified
independent underwriter" and its counsel).
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(f) Inclusion of Other Securities. The Company shall not register
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securities (other than Registrable Securities) for sale for the account of any
Person other than the Company in any registration requested pursuant to
Section 3.1(a) or 3.1(b) unless (i) in the case of a registration requested
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pursuant to Section 3.1(a), permitted to do so by the written consent of holders
holding at least a majority (by number of shares) of the Registrable Securities
proposed to be sold in such registration and (ii) in the case of a registration
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requested pursuant to Section 3.1(b), such securities are being sold for the
account of a Person who was a stockholder of the Company on the date of this
Agreement or who is entitled to make a request under Section 3.1(b).
(g) Effective Registration Statement. A registration requested
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pursuant to Section 3.1(a) or 3.1(b) will not be deemed to have been effected
unless it has become effective for the period specified in Section 3.3(b).
Notwithstanding the preceding sentence, a registration requested pursuant to
Section 3.1(a) or 3.1(b) which does not become effective after the Company has
filed a registration statement with respect thereto solely by reason of the
refusal to proceed of the holder or holders of Registrable Securities requesting
the registration shall be deemed to have been effected by the Company at the
request of such holder or holders, provided that this sentence shall not apply
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to the first registration requested pursuant to Section 3.1(b) that so fails
to become effective if the Person requesting such registration reimburses the
Company for all Registration Expenses with respect thereto.
(h) Pro Rata Allocation. If the holders of a majority (by number of
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shares) of the Registrable Securities for which registration is being requested
pursuant to Section 3.1(a) or 3.1(b) determine, based on consultation with the
managing underwriters or, in an offering which is not underwritten, with an
investment banker, that the number of securities to be sold in any such offering
should be limited due to market conditions or otherwise, all holders of
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Registrable Securities proposing to sell their securities in such registration
and (if the Company proposes to sell securities for its own account in such
offering) the Company shall share pro rata in the number of securities being
offered (as determined by the holders holding a majority (by number of shares)
of the Registrable Securities for which registration is being requested in
consultation with the managing underwriters or investment banker, as the case
may be) and registered for their account, such sharing to be based on the
number of Registrable Securities as to which registration was requested by such
holders and the number of securities that the Company proposed to sell for its
own account in such offering, respectively, provided that, in the case of a
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registration requested pursuant to Section 3.1(b), all Registrable Securities
that the Person making such request under Section 3.1(b) wishes to include in
such registration shall be included in such registration (at the time such
registration becomes effective) before any other securities are included in such
registration, unless such Person otherwise consents in writing.
3.2. Incidental Registration. If the Company at any time proposes to
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register any of its equity securities (as defined in the Exchange Act) under the
Securities Act (other than pursuant to Section 3.1 or pursuant to a Special
Registration), whether or not for sale for its own account, and the registration
form to be used may be used for the registration of Registrable Securities, it
will each such time give prompt written notice to all holders of Registrable
Securities of its intention to do so and, upon the written request of any holder
of Registrable Securities given to the Company within 30 days after the Company
has given any such notice (which request shall specify the Registrable
Securities intended to be disposed of by such holder and the intended method
of disposition thereof), the Company will use its best efforts to effect the
registration under the Securities Act of all Registrable Securities which the
Company has been so requested to register by the holders thereof, to the extent
required to permit the disposition (in accordance with the intended methods
thereof as
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aforesaid) of the Registrable Securities so to be registered, provided that:
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(a) if such registration shall be in connection with the Initial
Public Offering, the Company shall not include any Registrable Securities
in such proposed registration if the Company's Board of Directors shall
have determined, after consultation with the managing underwriters for such
offering, that it is not in the best interests of the Company to include
any Registrable Securities in such registration, provided that, if the
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Company's Board of Directors makes such a determination, the Company
shall not include in such registration any securities not being sold for
the account of the Company;
(b) 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 Company shall
determine for any reason not to register such securities, the Company may,
at its election, give written notice of such determination to each holder
of Registrable Securities that was previously notified of such registration
and, thereupon, shall not register any Registrable Securities in connection
with such registration (but shall nevertheless pay the Registration
Expenses in connection therewith), without prejudice, however, to the
rights of any holder or holders of Registrable Securities to request that a
registration be effected under Section 3.1; and
(c) if the Company shall be advised in writing by the managing
underwriters (or, in connection with an offering which is not underwritten,
by an investment banker) that in their or its opinion the number of
securities requested to be included in such registration (whether by the
Company, pursuant to this Section 3.2 or pursuant to any other rights
granted by the Company to a holder or holders of its securities to
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request or demand such registration or inclusion of any such securities in
any such registration) exceeds the number of such securities which can be
sold in such offering,
(i) the Company shall include in such registration the number
(if any) of Registrable Securities so requested to be included which
in the opinion of such underwriters or investment banker, as the case
may be, can be sold and shall not include in such registration any
securities (other than securities being sold by the Company, which
shall have priority in being included in such registration) so
requested to be included other than Registrable Securities unless all
Registrable Securities requested to be so included are included
therein, and
(ii) if in the opinion of such underwriters or investment banker,
as the case may be, some but not all of the Registrable Securities may
be so included, all holders of Registrable Securities requested to be
included therein shall share pro rata in the number of shares of
Registrable Securities included in such public offering on the basis
of the number of Registrable Securities requested to be included
therein by such holders, provided that, in the case of a registration
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initially requested or demanded by a holder or holders of securities
other than Registrable Securities, the holders of the Registrable
Securities requested to be included therein and the holders of such
other securities shall share pro rata (based on the number of shares
if the requested or demanded registration is to cover only Common
Stock and, if not, based on the proposed offering price of the total
number of securities included in such public offering requested to be
included therein),
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and the Company shall so provide in any registration agreement hereinafter
entered into with respect to any of its securities.
The Company will pay all Registration Expenses in connection with each
registration of Registrable Securities requested pursuant to this Section 3.2.
No registration effected under this Section 3.2 shall relieve the Company from
its obligation to effect registrations upon request under Section 3.1.
3.3. Registration Procedures. If and whenever the Company is
-----------------------
required to use its best efforts to effect the registration of any Registrable
Securities under the Securities Act as provided in Sections 3.1 and 3.2, the
Company will promptly:
(a) prepare and file with the Securities and Exchange Commission
within 120 days, and use its best efforts to prepare and file within 60
days, after receipt of a request pursuant to Section 3.1 a registration
statement with respect to such securities, make all required filings with
the NASD and use best efforts to cause such registration statement to
become effective;
(b) prepare and file with the Securities and Exchange Commission such
amendments and supplements to such registration statement and the
prospectus used in connection therewith and such other documents as may be
necessary to keep such registration statement effective and to comply with
the provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement until such time as all
of such securities have been disposed of in accordance with the intended
methods of disposition by the seller or sellers thereof set forth in such
registration statement, but in no event for a period of more than six
months after such registration statement becomes effective;
17
(c) furnish to counsel (if any) selected by the holders of a majority
(by number of shares) of the Registrable Securities covered by such
registration statement and to counsel for the underwriters in any
underwritten offering copies of all documents proposed to be filed with the
Securities and Exchange Commission (including all documents to be filed on
a confidential basis) in connection with such registration, which documents
will be subject to the review of such counsel;
(d) furnish to each seller of such securities, without charge, such
number of conformed copies of such registration statement and of each such
amendment and supplement thereto (in each case, including all exhibits
and documents filed therewith (other than those filed on a confidential
basis), except that the Company shall not be obligated to furnish any
seller of securities with more than two copies of such exhibits and
documents), such number of copies of the prospectus included in such
registration statement (including each preliminary prospectus and any
summary prospectus) in conformity with the requirements of the Securities
Act, and such other documents, as such seller may reasonably request in
order to facilitate the disposition of the securities owned by such seller;
(e) use its best efforts to register or qualify the securities
covered by such registration statement under such other securities or blue
sky laws of such jurisdictions as each seller shall request, and do any and
all other acts and things which may be necessary or advisable to enable
such seller to consummate the disposition in such jurisdictions of the
securities owned by such seller, except that the Company shall not for any
such purpose be required to qualify generally to do business as a foreign
corporation in any jurisdiction wherein it is not so qualified, subject
itself to taxation in any jurisdiction wherein it is not so subject, or
take any action which would subject it to general
18
service of process in any jurisdiction wherein it is not so subject;
(f) in connection with an underwritten public offering only,
furnish to each seller a signed counterpart, addressed to the sellers, of
(i) an opinion of counsel for the Company experienced in
securities law matters, dated the effective date of the registration
statement, and
(ii) a "comfort" letter signed by the independent public
accountants who have issued an audit report on the Company's financial
statements included in the registration statement,
covering substantially the same matters with respect to the registration
statement (and the prospectus included therein) and, in the case of such
accountants' letter, with respect to events subsequent to the date of such
financial statements, as are customarily covered in opinions of issuer's
counsel and in accountants' letters delivered to the underwriters in
underwritten public offerings of securities;
(g) (i) notify each holder of Registrable Securities covered by such
-
registration statement if such registration statement, at the time it or
any amendment thereto became effective, contained an untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, and, as
promptly as practicable, prepare and file with the Securities and Exchange
Commission a post-effective amendment to such registration statement and
use best efforts to cause such post-effective amendment to become effective
such that such registration statement, as so amended, shall not contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein
not
19
misleading, and (ii) notify each holder of Registrable Securities covered
--
by such registration statement, at any time when a prospectus relating
thereto is required to be delivered under the Securities Act, if the
prospectus included in such registration statement, as then in effect,
includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading, and, as promptly as is practicable, prepare and
furnish to such holder a reasonable number of copies of a supplement to
or an 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 the statements therein, in light of the circumstances under which
they were made, not misleading;
(h) otherwise use its best efforts to comply with all applicable
rules and regulations of the Securities and Exchange Commission, and make
available to its security holders, as soon as reasonably practicable, an
earnings statement of the Company complying with the provisions of Section
11(a) of the Securities Act and Rule 158 under the Securities Act;
(i) notify each seller of any securities covered by such registration
statement (i) when such registration statement, or any post-effective
-
amendment to such registration statement, shall have become effective, or
any amendment of or supplement to the prospectus used in connection
therewith shall have been filed, (ii) of any request by the Securities and
--
Exchange Commission to amend such registration statement or to amend or
supplement such prospectus or for additional information, (iii) of the
---
issuance by the Securities and Exchange Commission of any stop order
suspending the effectiveness of such registration statement or of any
20
order preventing or suspending the use of any preliminary prospectus, and
(iv) of the suspension of the qualification of such securities for offering
--
or sale in any jurisdiction, or of the institution of any proceedings for
any of such purposes;
(j) use its best efforts (i) (A) to list such securities on any
- -
securities exchange on which the Common Stock is then listed or, if no
Common Stock is then listed, on an exchange selected by the Company, if
such listing is then permitted under the rules of such exchange or (B) if
-
such listing is not practicable or the Board of Directors of the Company
determines that quotation as a NASDAQ National Market System security is
preferable, to secure designation of such securities as a NASDAQ "national
market system security" within the meaning of Rule 11Aa2-1 under the
Exchange Act or, failing that, to secure NASDAQ authorization for such
securities, and, without limiting the foregoing, to arrange for at least
two market makers to register as such with respect to such securities with
the NASD, (ii) to provide a transfer agent and registrar for such
--
Registrable Securities not later than the effective date of such
registration statement and (iii) to obtain a CUSIP number for the
---
Registrable Securities; and
(k) use every reasonable effort to obtain the lifting of any stop
order that might be issued suspending the effectiveness of such
registration statement or of any order preventing or suspending the use of
any preliminary prospectus.
The Company may require each seller of any securities as to which
any registration is being effected to furnish to the Company such information
regarding such seller and the distribution of such securities as the Company may
from time to time reasonably request in writing and as shall be required by law
in connection therewith. Each such holder agrees to furnish promptly to the
Company all information required to be disclosed in order to make the
21
information previously furnished to the Company by such holder not materially
misleading.
The Company agrees not to file or make any amendment to any
registration statement with respect to any Registrable Securities, or any
amendment of or supplement to the prospectus used in connection therewith, which
refers to any seller of any securities covered thereby by name, or otherwise
identifies such seller as the holder of any securities of the Company, without
the consent of such seller, such consent not to be unreasonably withheld, except
that no such consent shall be required for any disclosure that is required by
law.
By acquisition of Registrable Securities, each holder of such
Registrable Securities shall be deemed to have agreed that upon receipt of any
notice from the Company pursuant to Section 3.3(g), such holder will promptly
discontinue such holder's disposition of Registrable Securities pursuant to the
registration statement covering such Registrable Securities until such holder
shall have received, in the case of clause (i) of Section 3.3(g), notice from
the Company that such registration statement has been amended, as contemplated
by Section 3.3(g), and, in the case of clause (ii) of Section 3.3(g), copies of
the supplemented or amended prospectus contemplated by Section 3.3(g). If so
directed by the Company, each holder of Registrable Securities will deliver to
the Company (at the Company's expense) all copies, other than permanent file
copies, in such holder's possession of the prospectus covering such Registrable
Securities at the time of receipt of such notice. In the event that the Company
shall give any such notice, the period mentioned in Section 3.3(b) shall be
extended by the number of days during the period from and including the date of
the giving of such notice to and including the date when each seller of any
Registrable Securities covered by such registration statement shall have
received the copies of the supplemented or amended prospectus contemplated by
Section 3.3(g).
22
Although shares of Class A Common Stock issuable upon the exercise of
options and shares of Class B Common Stock are included in the definition of
Registrable Securities, the Company shall, in respect of any such Registrable
Securities requested to be registered pursuant hereto, be required to include in
any registration statement only shares of Class A Common Stock issuable upon
conversion of or pursuant to such Registrable Securities and only if the Company
has received assurances, reasonably satisfactory to it, in the case of shares
issuable upon exercise of options, that such options will be exercised and in
the case of Class B Common Stock that such Registrable Securities will be
converted into shares of Class A Common Stock, in each case, promptly after such
registration statement has become effective or the sale to an underwriter has
been consummated so that only Class A Common Stock shall be distributed to the
public under such registration statement.
3.4. Underwritten Offerings. The provisions of this Section 3.4 do
----------------------
not establish additional registration rights but instead set forth procedures
applicable, in addition to those set forth in Sections 3.1 through 3.3, to any
registration which is an underwritten offering.
(a) Underwritten Offerings Exclusive. Whenever a registration
--------------------------------
requested pursuant to Section 3.1 is for an underwritten offering, only
securities which are to be distributed by the underwriters may be included in
the registration.
(b) Underwriting Agreement. If requested by the underwriters for any
----------------------
underwritten offering by holders of Registrable Securities pursuant to a
registration requested under Section 3.1, the Company shall enter into an
underwriting agreement with such underwriters for such offering, such agreement
to be reasonably satisfactory in substance and form to the holders of a majority
(by number of shares) of the Registrable Securities to be covered by such
registration and to the underwriters and to contain such representations and
warranties by the Company and such other
23
terms and provisions as are customarily contained in agreements of this type,
including, but not limited to, indemnities to the effect and to the extent
provided in Section 3.7, provisions for the delivery of officers' certificates,
opinions of counsel and accountants' "comfort" letters and hold-back
arrangements. The holders of Registrable Securities to be distributed by such
underwriters shall be parties to such underwriting agreement and may, at their
option, require that any or all of the representations and warranties by, and
the agreements on the part of, the Company to and for the benefit of such
underwriters be made to and for the benefit of such holders of Registrable
Securities and that any or all of the conditions precedent to the obligations
of such underwriters under such underwriting agreement shall also be conditions
precedent to the obligations of such holders of Registrable Securities. In the
case of a registration requested by the C&D Fund pursuant to Section 3.1(a),
Westinghouse shall not be required by the Company or the C&D Fund to make any
representations or warranties to, or agreements with, the Company or the under
writers other than as set forth in Section 3.4(e) and representations,
warranties or agreements regarding Westinghouse and its intended method of
distribution.
(c) Selection of Underwriters. Whenever a registration requested
-------------------------
pursuant to Section 3.1 is for an underwritten offering, the Company will have
the right to select one or more underwriters to administer the offering at least
one of which shall be an underwriter of nationally recognized standing,
provided that, in the case of any such registration requested pursuant to
--------
Section 3.1(b), the selection of such underwriters by the Company shall be
subject to the consent of Westinghouse, which consent shall not be unreasonably
withheld. If the Company at any time proposes to register any of its securities
under the Securities Act for sale for its own account and such securities are to
be distributed by or through one or more underwriters, the Company will have the
right to select one or more underwriters to administer the offering at least
one of which shall be an underwriter of nationally recognized standing.
24
(d) Incidental Underwritten Offerings. Subject to the provisions of
---------------------------------
the proviso to the first sentence of Section 3.2, if the Company at any time
proposes to register any of its equity securities under the Securities Act
(other than pursuant to Section 3.1 or pursuant to a Special Registration),
whether or not for its own account, and such securities are to be distributed by
or through one or more underwriters, the Company will give prompt written notice
to all holders of Registrable Securities of its intention to do so and, if
requested by any holder of Registrable Securities, will arrange for such
underwriters to include the Registrable Securities to be offered and sold by
such holder among those to be distributed by such underwriters. The holders of
Registrable Securities to be distributed by such underwriters shall be parties
to the underwriting agreement between the Company and such underwriters and may,
at their option, require that any or all of the representations and warranties
by, and the other agreements on the part of, the Company to and for the benefit
of such underwriters shall also be made to and for the benefit of such holders
of Registrable Securities and that any or all of the conditions precedent to
the obligations of the underwriters under such underwriting agreement shall also
be conditions precedent to the obligations of such holders of Registrable
Securities. No such holder of Registrable Securities shall be required by the
Company to make any representations or warranties to, or agreements with, the
Company or the underwriters other than as set forth in Section 3.4(e) and
representations, warranties or agreements regarding such holder and such
holder's intended method of distribution.
(e) Hold Back Agreements. If and whenever the Company proposes to
--------------------
register any of its equity securities under the Securities Act for its own
account (other than pursuant to a Special Registration) or is required to use
its best efforts to effect the registration of any Registrable Securities
under the Securities Act pursuant to Section 3.1 or 3.2, each holder of
Registrable Securities agrees by acquisition of such Registrable Securities not
to effect (other than pursuant to such registration) any public
25
sale or distribution, including, but not limited to, any sale pursuant to Rule
144 or Rule 144A, of any Registrable Securities, any other equity securities of
the Company or any securities convertible into or exchangeable or exercisable
for any equity securities of the Company for 120 days (180 days if such
registration statement relates to the Initial Public Offering) after, and
(assuming compliance by the Company with Section 3.4(f)) during the 20 days
prior to, the effective date of such registration and the Company agrees to
cause each holder of any equity security, or of any security convertible into or
exchangeable or exercisable for any equity security, of the Company purchased
from the Company at any time other than in a public offering to enter into a
similar agreement with the Company. The Company further agrees not to effect
(other than pursuant to such registration or pursuant to a Special Registration)
any public sale or distribution, or to file any registration statement
(other than such registration or a Special Registration) covering any, of its
equity securities, or any securities convertible into or exchangeable or
exercisable for such securities, during the 20 days prior to, and for 120 days
(180 days if such registration statement relates to the Initial Public Offering)
after, the effective date of such registration.
(f) Notice of Impending Effective Date. The Company will give at
----------------------------------
least 20 days' written notice to each holder of Registrable Securities of the
date when the Company expects, in its good faith judgment, that any
registration pursuant to Section 3.1 or 3.2 will become effective (such notice
to specify the expected effective date) and will respond promptly to any
subsequent reasonable requests from any holder of Registrable Securities
concerning the likely effective date of such registration.
3.5. Preparation; Reasonable Investigation. In connection with the
-------------------------------------
preparation and filing of each registration statement registering Registrable
Securities under the Securities Act, the Company will give the holders of such
Registrable Securities so to be registered and their
26
underwriters, if any, and their respective counsel and accountants the
opportunity to participate in the preparation of such registration statement,
each prospectus included therein or filed with the Securities and Exchange
Commission, and each amendment thereof or supplement thereto, and will give
each of them such access to its books and records and such opportunities to
discuss the business of the Company with its officers and the independent public
accountants who have issued audit reports on its financial statements as shall
be necessary, in the opinion of such holders' and such underwriters' respective
counsel, to conduct a reasonable investigation within the meaning of the
Securities Act.
3.6. Other Registrations. If and whenever the Company is required to
-------------------
use its best efforts to effect the registration of any Registrable Securities
under the Securities Act pursuant to Section 3.1 or 3.2, and if such
registration shall not have been withdrawn or abandoned, the Company shall not
be obligated to and shall not file any registration statement with respect to
any of its securities (including Registrable Securities) under the Securities
Act (other than a Special Registration), whether of its own accord or at the
request or demand of any holder or holders of such securities, until a period of
six months shall have elapsed from the effective date of such previous
registration; and the Company shall so provide in any registration agreement
with respect to any of its securities.
3.7. Indemnification.
---------------
(a) Indemnification by the Company. In the event of any registration
------------------------------
of any Registrable Securities under the Securities Act pursuant to Section 3.1
or 3.2, the Company will indemnify and hold harmless the seller of such
securities, its directors, officers, and employees, each other person who
participates as an underwriter, broker or dealer in the offering or sale of such
securities and each other person, if any, who controls such seller or any such
participating person within the meaning of either Section 15 of
27
the Securities Act or Section 20 of the Exchange Act, against any and all
losses, claims, damages or liabilities, joint or several, to which such seller
or any such director, officer, employee, participating person or controlling
person may become subject under the Securities Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) arise out of or are based upon (i) any untrue statement or alleged
-
untrue statement of a fact contained in any registration statement under which
such securities were registered under the Securities Act, any preliminary
prospectus, final prospectus or summary prospectus contained therein or related
thereto, or any amendment or supplement thereto, or (ii) any omission or alleged
--
omission to state a fact required to be stated in any such registration
statement, preliminary prospectus, final prospectus, summary prospectus,
amendment or supplement or necessary to make the statements therein not
misleading; and the Company will reimburse such seller and each such director,
officer, employee, participating person and controlling person for any legal or
any other expenses reasonably incurred by them in connection with investigating
or defending any such loss, claim, liability, action or proceeding, provided
--------
that the Company shall not be liable in any such case to the extent that any any
loss, claim, damage, liability or expense arises out of or is based upon an
untrue statement or omission made in such registration statement, any such
preliminary prospectus, final prospectus, summary prospectus, amendment or
supplement in reliance upon and in conformity with written information furnished
to the Company by such seller or participating person expressly for use in the
preparation thereof and provided, further, that the Company shall not be liable
-------- -------
in any such case to the extent that any such loss, claim, damage, liability or
expense arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission in the prospectus, if such untrue
statement or alleged untrue statement or omission or alleged omission is
completely corrected in an amendment or supplement to the prospectus and the
seller of Registrable Securities thereafter fails to deliver such prospectus as
so amended or supplemented prior
28
to or concurrently with the sale of Registrable Securities to the person
asserting such loss, claim, damage, liability or expense after the Company had
furnished such seller with a sufficient number of copies of the same or if the
seller received notice from the Company of the existence of such untrue
statement or alleged untrue statement or omission or alleged omission and the
seller continued to dispose of Registrable Securities prior to the time of the
receipt of either (A) an amended or supplemented prospectus which completely
-
corrected such untrue statement or omission or (B) a notice from the Company
-
that the use of the existing prospectus may be resumed. Such indemnity shall
remain in full force and effect regardless of any investigation made by or on
behalf of such seller or any such director, officer, employee, participating
person or controlling person and shall survive the transfer of such securities
by such seller.
(b) Indemnification by the Sellers. The Company may require, as a
------------------------------
condition to including any Registrable Securities in any registration statement
filed pursuant to Section 3.3, that the Company shall have received an
undertaking satisfactory to it from each of the prospective sellers of such
securities, to indemnify and hold harmless (in the same manner and to the extent
as set forth in Section 3.7(a)) the Company, each director of the Company,
each officer of the Company who shall sign such registration statement and each
other person, if any, who controls the Company within the meaning of the
Securities Act, with respect to any statement in or omission from such
registration statement, any preliminary prospectus or final prospectus
contained therein, or any amendment or supplement thereto, if such statement or
omission was made in reliance upon and in conformity with written information
furnished to the Company by such seller expressly for use in the preparation of
such registration statement, preliminary prospectus, final prospectus, summary
prospectus, amendment or supplement, provided that the liability of each such
--------
seller will be in proportion to and limited to the net amount received by such
seller (after deducting any underwriting discount
29
and expenses) from the sale of Registrable Securities pursuant to such
registration statement. Such indemnity shall remain in full force and effect
regardless of any investigation made by or on behalf of the Company or any
such director, officer or controlling person and shall survive the transfer of
such securities by such seller.
(c) Notices of Claims, etc. Promptly after receipt by an indemnified
----------------------
party of notice of the commencement of any action or proceeding involving a
claim referred to in the preceding paragraphs of this Section 3.7, such
indemnified party will, if a claim in respect thereof is to be made against an
indemnifying party hereunder, give written notice to the latter of the
commencement of such action, provided that the failure of any indemnified party
--------
to give notice as provided therein shall not relieve the indemnifying party of
its obligations under the preceding paragraphs of this Section 3.7. In case any
such action is brought against an indemnified party, the indemnifying party will
be entitled to participate therein and to assume the defense thereof, jointly
with any other indemnifying party similarly notified to the extent that it may
wish, with counsel reasonably satisfactory to such indemnified party, and
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party will not be
liable to such indemnified party for any legal or other expenses subsequently
incurred by the latter in connection with the defense thereof, provided that if
--------
such indemnified party and the indemnifying party reasonably determine, based
upon advice of their respective independent counsel, that a conflict of
interest may exist between the indemnified party and the indemnifying party
with respect to such action and that it is advisable for such indemnified party
to be represented by separate counsel, such indemnified party may retain other
counsel, reasonably satisfactory to the indemnifying party, to represent such
indemnified party, and the indemnifying party shall pay all reasonable fees and
expenses of such counsel. No indemnifying party, in the defense of any such
claim or litigation, shall, except with the consent of such indemnified party,
30
which consent shall not be unreasonably withheld, consent to entry of any
judgment or enter into any settlement which does not include as an unconditional
term thereof the giving by the claimant or plaintiff to such indemnified party
of a release from all liability in respect to such claim or litigation.
(d) Other Indemnification. Indemnification similar to that
---------------------
specified in the preceding paragraphs of this Section 3.7 (with appropriate
modifications) shall be given by the Company and each seller of Registrable
Securities with respect to any required registration or other qualification of
such Registrable Securities under any Federal or state law or regulation of
governmental authority other than the Securities Act.
(e) Other Remedies. If for any reason the foregoing indemnity is
--------------
unavailable, or is insufficient to hold harmless an indemnified party, other
than by reason of the exceptions provided therein, then the indemnifying party
shall contribute to the amount paid or payable by the indemnified party as a
result of such losses, claims, damages, liabilities or expenses party as well as
any other relevant equitable considerations (i) in such proportion as is
appropriate to reflect the relative benefits received by the indemnifying party
on the one hand and the indemnified party on the other from the offering of
Registrable Securities (taking into account the portion of the proceeds of the
offering realized by each such party) or (ii) if the allocation provided by
--
clause (i) above is not permitted by applicable law, or provides a lesser sum to
the indemnified party than the amount hereinafter calculated, in such
proportion as is appropriate to reflect not only the relative benefits received
by the indemnifying party on the one hand and the indemnified party on the other
but also the relative fault of the indemnifying party and the indemnified. No
person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who was not guilty of such fraudulent misrepresentation. No party shall be
31
liable for contribution under this Section 3.7(e) except to the extent and under
such circumstances as such party would have been liable to indemnify under this
Section 3.7 if such indemnification were enforceable under applicable law.
(f) Officers and Directors. As used in this Section 3.7, the terms
----------------------
"officers" and "directors" shall include the partners of the holders of
Registrable Securities which are partnerships.
4. Participation Rights. The C&D Fund shall not make any Qualifying
--------------------
Sale, except pursuant to the following provisions of this Section 4.
(a) Procedures for Qualifying Sales. At least 30 days prior to
-------------------------------
making any Qualifying Sale, the C&D Fund will deliver a written notice (the
"Sale Notice") to the Company, the holder of the Option and the holders of
------------
Registrable Securities. The Sale Notice will fully disclose the identity of
the prospective transferee and the terms and conditions of the proposed
Qualifying Sale, including the class of Registrable Securities to be sold (the
"Specified Securities"), the maximum amount of Specified Securities that the
----------------------
prospective transferee is willing to purchase and the intended consummation
date of such Qualifying Sale. The C&D Fund may not give a Sale Notice with
respect to any Qualifying Sale unless both the C&D Fund and the prospective
transferee shall be legally bound to complete such Qualifying Sale (subject
only to the satisfaction of the conditions of such Qualifying Sale disclosed in
such Sale Notice and compliance with this Section 4 and any Applicable Law).
The C&D Fund will not consummate any Qualifying Sale until at least 30 days
after the related Sale Notice has been given to the holder of the Option and the
holders of Registrable Securities, unless the C&D Fund shall have received a
notice from each holder of Specified Securities or securities presently
convertible into or exchangeable or exercisable for Specified Securities
(collectively, "Qualifying Securities") indicating whether or not such holder
----------------------
has elected to participate in such Qualifying Sale and the amount of
32
Specified Securities to be sold by each such holder so electing to participate
has been finally determined pursuant hereto prior to the expiration of such 30-
day period. Each holder of Qualifying Securities may elect to participate in the
contemplated Qualifying Sale by giving written notice to the C&D Fund and the
Company within 30 days after the C&D Fund has given the related Sale Notice to
such holder. If a holder of Qualifying Securities elects to participate, such
holder will be entitled to sell in the contemplated Qualifying Sale, at the same
price and (subject to the immediately following sentence) on the same terms
and conditions as set forth in the related Sale Notice, an amount of Specified
Securities equal to the product of (i) the quotient determined by dividing (A)
- -
the amount of Specified Securities then held by such holder (including in such
amount all Specified Securities issuable upon conversion, exchange or exercise
of all Qualifying Securities then held by such holder) by (B) the aggregate
--
amount of Specified Securities held by the C&D Fund and all holders of
Qualifying Securities (other than the C&D Fund) so electing to participate
(including in such aggregate amount all Specified Securities issuable upon
conversion, exchange or exercise of Qualifying Securities then held by the C&D
Fund and such holders) and (ii) the amount of Specified Securities such
--
transferee has agreed to purchase in the contemplated Qualifying Sale.
Notwithstanding the immediately preceding sentence, Westinghouse shall not be
required in connection with any Qualifying Sale in which it elects to
participate (x) to enter into any non-competition covenant or agreement having a
-
scope or duration beyond that contained in the Non-Competition Agreement dated
the date hereof entered into by Westinghouse pursuant to the Acquisition
Agreement or (y) other than in respect of representations, warranties,
-
covenants and agreements made solely on its own behalf, to undertake any
liability in excess of its proportionate share (based on the amount of
securities sold in such Qualifying Sale) for representations, warranties,
covenants and agreements made jointly by the selling holders in such Qualifying
Sale. If a holder of Qualifying Securities elects to participate in any
Qualifying Sale, the C&D Fund will not
33
consummate such Qualifying Sale unless such holder has been afforded the
opportunity to consummate simultaneously the sale by such holder of the amount
of Specified Securities determined in accordance with the preceding sentence
with respect to such holder. Each holder of Qualifying Securities proposing
to include in any contemplated Qualifying Sale Specified Securities to be issued
to such holder upon the conversion of other Qualifying Securities then held by
such holder shall effect such conversion prior to the time of such Qualifying
Sale.
(b) Qualifying Sale Defined. The term "Qualifying Sale" shall mean
----------------------- ----------------
any sale or transfer of securities of the Company by the C&D Fund other than any
sale or transfer (i) pursuant to a bona fide firm commitment underwritten public
-
offering (A) pursuant to a registration under the Securities Act effected
-
pursuant to Section 3.1 or (B) pursuant to a registration under the Securities
-
Act not effected pursuant to Section 3.1 if Section 3.2 applies to such
registration and, in each of clauses (A) and (B), the Company has complied with
all its obligations under Section 3 with respect to such registration, (ii) if
--
the Company is subject to the reporting requirements of the Exchange Act, in
transactions that comply with the manner of sale requirements set forth in
Rule 144(f)) or (iii) to Individual Investors or Management Stockholders.
---
5. Investors' Rights to Purchase Additional Capital Stock.
------------------------------------------------------
5.1. C&D Sale. If, prior to the consummation of a Specified Public
--------
Offering, the Company shall propose to issue any additional shares of its
capital stock (or any securities that may be exercised or exchanged for or
converted into such capital stock) to the C&D Fund or any Affiliate of the C&D
Fund (such Persons to whom the Company proposes to issue securities are referred
to collectively as the "C&D Offeree", and such issuance is referred to as a "C&D
----------- ---
Sale"), the Company shall offer to the holder of the Option and each holder of
----
Registrable Securities (other than
34
the C&D Offeree) that is an accredited investor (as defined in Rule 501 of
Regulation D under the Securities Act) (each, an "Eligible Holder") the right to
---------------
acquire such holder's Allocated Amount of such securities (an "Offer").
-----
Notwithstanding the foregoing, none of the following transactions shall
constitute a C&D Sale: the issuance by the Company of any shares of its
capital stock (or any securities that may be exercised or exchanged for or
converted into such capital stock) (A) pursuant to the Fund Stock Subscription
-
Agreement or the Capital Call Agreement (each as in effect on the date hereof),
(B) in exchange for Class A Common Stock, (C) upon conversion of Class B Common
- -
Stock or (D) as a dividend or other distribution (including, but not limited to,
-
in connection with any merger, consolidation or other reorganization) made pro
---
rata to the holders of the Common Stock outstanding on the record date for such
----
dividend or distribution.
5.2. Offer Procedures.
----------------
(a) Procedures. The Company shall make an Offer by giving to each
----------
Eligible Holder at least 30 Business Days' prior written notice of the proposed
C&D Sale. Such notice will (i) identify the class and number of shares or
-
amount of securities proposed to be issued (the "Offered Securities"), the
-------------------
proposed date of issuance and the price and other terms of the issuance and (ii)
--
constitute an offer to issue to each such Eligible Holder its Allocated Amount
of the Offered Securities at the same price and on the same other terms (subject
to Section 5.2(c)) as are proposed for such C&D Sale, which offer shall remain
open for a period of 15 Business Days from the date such notice is given by the
Company. Each Eligible Holder desiring to accept such Offer shall give written
notice to the Company prior to the end of the 15-Business Day period of such
Offer. Such notice (a "Notice of Acceptance") will (A) set forth the maximum
-------------------- -
amount of the Offered Securities which such Eligible Holder elects to purchase
(such Eligible Holder's "Subscribed Amount") and (B) constitute an acceptance of
----------------- -
the Offer with respect to such Eligible Holder's Allocated Amount of the
35
Offered Securities. If any such Eligible Holder fails to give a Notice of
Acceptance, such Eligible Holder shall be deemed to have rejected such Offer in
full. At the closing of the C&D Sale, each Eligible Holder who shall have
timely accepted the related Offer pursuant to this Section 5.2(a) (each, an
"Accepting Holder") shall acquire from the Company, and the Company shall issue
-----------------
to such Eligible Holder, its Allocated Amount of the Offered Securities at the
same price and on the same other terms (subject to Section 5.2(c)) as such C&D
Sale. The C&D Offeree shall be entitled to acquire at the closing of the C&D
Sale its Allocated Amount of the Offered Securities. Any Offered Securities not
issued at the C&D Sale may not thereafter be sold or otherwise issued by the
Company to the C&D Fund or any Affiliate of the C&D Fund until they are again
offered to the Eligible Holders under the procedures specified in this Section
5(a).
(b) Allocated Amount Defined. For the purposes of Section 5.2(a),
------------------------
the term "Allocated Amount" shall mean, with respect to each Accepting Holder
----------------
and the C&D Offeree (collectively, the "Participants") in a C&D Sale, the
aggregate amount of the Offered Securities in such C&D Sale allocated to such
Participant in a series of calculations (each, an "Allocation Calculation") as
----------------------
follows: first, each Participant shall be allocated an amount of the Offered
Securities in such C&D Sale equal to the lesser of (a) such Participant's
-
Subscribed Amount of such Offered Securities and (b) such Participant's
-
Proportionate First Share of such Offered Securities; thereafter, in each
subsequent Allocation Calculation for such C&D Sale, each Participant whose
Subscribed Amount of such Offered Securities exceeds the aggregate amount of
Offered Securities allocated to such Participant in prior Allocation
Calculations in respect of such C&D Sale shall be allocated an additional amount
of Offered Securities equal to the lesser of (i) such Participant's
-
Proportionate Subsequent Share of such Offered Securities and (ii) the excess of
--
such Participant's Subscribed Amount of such Offered Securities over the
aggregate amount of Offered Securities allocated to such Participant
36
in all prior Allocation Calculations in respect of such C&D Sale. For the
purposes of this Section 5.2(a), the term "Proportionate First Share" shall
-------------------------
mean, with respect to each Participant in a C&D Sale, an amount of the Offered
Securities in such C&D Sale that is equal to the product of (a) the quotient
-
determined by dividing (i) the percentage of the outstanding Common Stock (on a
-
fully diluted basis) held by such Participant by (ii) the aggregate percentage
--
of the outstanding Common Stock (on a fully diluted basis) held by all
Participants in such C&D Sale and (b) the aggregate amount of such Offered
-
Securities. For the purposes of this Section 5.2(b), the term "Proportionate
-------------
Subsequent Share" shall mean, with respect to each Participant in a C&D Sale
----------------
being allocated a Proportionate Subsequent Share of Offered Securities in an
Allocation Calculation for such C&D Sale, an amount of the Offered Securities in
such C&D Sale equal to the product of (a) the quotient determined by dividing
-
(i) the percentage of the outstanding Common Stock (on a fully diluted basis)
-
held by such Participant by (ii) the aggregate percentage of the outstanding
--
Common Stock (on a fully diluted basis) held by all Participants being
allocated a Proportionate Subsequent Share of Offered Securities in such
Allocation Calculation and (b) the aggregate amount of the Offered Securities
-
not allocated to the Participants in such C&D Sale in any prior Allocation
Calculation.
(c) Terms of Offer. Notwithstanding Section 5.2(a), if the terms of
--------------
any C&D Sale provide for the payment by the C&D Offeree of consideration other
than cash, then the purchase price payable by each Accepting Holder (other than
Westinghouse) per unit of Offered Securities shall be an amount in cash equal to
the fair market value of the aggregate consideration payable by the C&D Offeree
per unit of Offered Securities. For the purpose of determining the fair market
value of any noncash consideration, (i) any portion of such consideration in the
-
form of securities shall be valued at the arithmetical average of the closing
sale prices of such securities over the five trading days immediately preceding
the relevant date on the national securities exchange on which such securities
are listed, or,
37
if not so listed, as reported by the National Association of Securities Dealers
Automated Quotations System, or, if not so reported, at the average of the high
bid and low asked quotations for the securities as reported by the National
Quotations Bureau Incorporated or a similar organization, or, if no price
quotations are available, such securities shall be valued by the Board of
Directors of the Company in good faith as of the relevant date or, at the
election (which shall be made in its Notice of Acceptance) and expense of an
Accepting Holder which has succeeded by assignment to Westinghouse's rights
under this Section 5 (other than Section 5.2(d)) in respect of Registrable
Securities or the Option transferred by Westinghouse to such Accepting Holder,
by an independent valuer with expertise in valuing such securities selected by
the Company with the approval of such Accepting Holder, such approval not to be
unreasonably withheld; and (ii) any other portion of such consideration shall be
--
valued by the Board of Directors of the Company in good faith as of the relevant
date or, at the election (which shall be made in its Notice of Acceptance) and
expense of such an Accepting Holder, by an independent valuer with expertise
in valuing such consideration selected by the Company with the approval of such
Accepting Holder, such approval not to be unreasonably withheld.
(d) Election as to Form of Consideration. Notwithstanding Section
------------------------------------
5.2(a), if Westinghouse elects to exercise its rights under Section 5.2(a) with
respect to any C&D Sale the terms of which provide for payment in
consideration other than cash, Westinghouse may, at its option, make such
payment in the form of consideration provided by such terms (including, if the
consideration consists in whole or in part of the delivery of any debt security
of any Person or other promise of any Person to pay cash, by delivery of a
security or other promise of Westinghouse, of the same tenor) or in cash equal
to the fair market value of such consideration. For the purpose of determining
the fair market value of any non-cash consideration, (i) any portion of such
-
consideration in the form of securities shall be valued at the arithmetical
average of the closing sale
38
prices of such securities over the five trading days immediately preceding the
relevant date on the national securities exchange on which such securities are
listed, or, if not so listed, as reported by the National Association of
Securities Dealers Automated Quotations System, or, if not so reported, at the
average of the high bid and low asked quotations for the securities as reported
by the National Quotations Bureau Incorporated or a similar organization, or, if
no price quotations are available, such securities shall be valued by the Board
of Directors of the Company in good faith as of the relevant date or, at the
election (which shall be made in its Notice of Acceptance) and expense of
Westinghouse, by an independent valuer with expertise in valuing such
securities selected by the Company with the prior approval of Westinghouse, such
approval not to be unreasonably withheld; and (ii) any other portion of such
--
consideration shall be valued by the Board of Directors of the Company in good
faith as of the relevant date or, at the election (which shall be made in its
Notice of Acceptance) and expense of Westinghouse, by an independent valuer
with expertise in valuing such consideration selected by the Company with the
prior approval of Westinghouse, such approval not to be unreasonably withheld.
6. Designation of Directors by the C&D Fund. (a) So long as the C&D
----------------------------------------
Fund owns any securities of the Company, the C&D Fund shall have the right to
nominate one candidate for election to the board of directors (each, a "Board")
-----
of each of the Company, Newco and the Canadian Buyer. In the event that the C&D
Fund shall exercise its rights under this Section 6, (i) each of the parties
-
hereto (other than the Company) shall vote, or cause to be voted, the capital
stock of the Company held or controlled by such party or any Affiliate of such
party and (ii) the Company shall vote, or cause to be voted, the capital stock
--
of Newco and the Canadian Buyer held or controlled by the Company or any
Affiliate of the Company, in each case, in favor of a slate of directors which
includes the nominees of the C&D Fund for the Boards of the Company, Newco and
the Canadian Buyer, respectively.
39
(b) The respective By-Laws of the Company, Newco and the Canadian
Buyer shall provide that, in the event that a vacancy shall be created on the
Board of such Buyer Party as a result of the death, resignation or removal (with
or without cause) of a director nominated by the C&D Fund in accordance with
Section 6(a), such Board shall within five Business Days of the creation of such
vacancy request the C&D Fund to nominate a candidate to be appointed by such
Board to fill such vacancy. In the event that any such vacancy shall be created
on the Board of the Company, Newco or the Canadian Buyer immediately before or
at the annual meeting of the stockholders of such Buyer Party, the C&D Fund
shall have the right to nominate a candidate to fill such vacancy and the
provisions of the second sentence of the immediately preceding paragraph shall
apply with respect to the election of such nominee to fill such vacancy. If the
preceding sentence shall not be applicable and a candidate nominated by the
C&D Fund to fill any such vacancy shall not have been appointed to fill such
vacancy within five Business Days of the Board of the applicable Buyer Party
having been given the name of such candidate by the C&D Fund, then, as
applicable, (i) in the case of a vacancy on the Board of the Company, each of
-
the parties hereto (other than the Company) shall act by written consent, or
call a special meeting of stockholders of the Company for the sole purpose of
filling such vacancy and at such special meeting vote or cause to be voted the
capital stock of the Company held or controlled by such party or any Affiliate
of such party, and (ii) in the case of a vacancy on the Board of Newco or the
--
Canadian Buyer, the Company shall (or shall cause each Affiliate of the Company
owning outstanding voting securities of Newco or the Canadian Buyer, as the
case may be, to) act by written consent, or call a special meeting of
stockholders of Newco or the Canadian Buyer, as the case may be, for the sole
purpose of filling such vacancy and at such special meeting vote or cause to be
voted the capital stock of Newco or the Canadian Buyer, as the case may be, held
or controlled by the Company or any Affiliate of the Company, in each case, to
elect such nominee to fill such vacancy.
40
(c) The C&D Fund may elect, at its option, not to have a designated
director on any Board.
(d) No party hereto shall, and the Company shall not permit Newco to,
vote, or give any consent, in favor of the removal as a director of the Company,
Newco or the Canadian Buyer, respectively, of any candidate nominated by the C&D
Fund for election as such director in accordance with Section 6(a) without the
prior written consent of the C&D Fund.
(e) No party hereto shall give, and the Company shall not permit
Newco to give, any proxy with respect to shares of the capital stock of the
Company, Newco or the Canadian Buyer, respectively, entitling the holder of such
proxy to vote on, or give consents with respect to, the election of directors
unless the holder of such proxy shall have agreed to comply with the obligations
of such party under this Section 6.
(f) If, in connection with the election of any candidate nominated by
the C&D Fund for election as a director of the Company or Newco, any party
hereto fails or refuses to vote as required by this Section 6, or votes or
gives any consent in contravention of this Section 6, the C&D Fund shall have an
irrevocable proxy pursuant to Section 212(e) of the General Corporation Law of
the State of Delaware, coupled with an interest, to vote (i) if the defaulting
-
party is any party hereto other than the Company, all the shares of capital
stock of the Company held or controlled by such party or (ii) if the
--
defaulting party is the Company, all the shares of capital stock of Newco held
or controlled by the Company, in each case, in accordance with this Section 6,
and each party hereto hereby grants such proxy.
7. Miscellaneous.
-------------
7.1. Rule 144; Legended Securities; etc. If the Company shall have
----------------------------------
filed a registration statement pursuant
41
to Section 12 of the Exchange Act or a registration statement pursuant to the
Securities Act relating to any class of equity securities (other than a
registration statement pursuant to a Special Registration), the Company will
file the reports required to be filed by it under the Securities Act and the
Exchange Act and the rules and regulations adopted by the Securities and
Exchange Commission thereunder (or, if the Company is not required to file such
reports, it will, upon the request of any holder of Registrable Securities, make
publicly available such information as necessary to permit sales pursuant to
Rule 144), and will take such further action as any holder of Registrable
Securities may reasonably request, all to the extent required from time to time
to enable such holder to sell shares of Registrable Securities without
registration under the Securities Act within the limitation of the exemptions
provided by Rule 144.
The Company will not issue new certificates for shares of Registrable
Securities without a legend restricting further transfer unless such shares
have been sold to the public pursuant to an effective registration statement
under the Securities Act or Rule 144, or unless otherwise permitted under the
Securities Act and the holder of such shares expressly so requests in writing.
7.2. Amendments and Waivers. This Agreement may be amended, and the
----------------------
Company may take any action herein prohibited, or omit to perform any act
herein required to be performed by it, only if the Company shall have obtained
the written consent to such amendment, action or omission to act, of the holder
or holders of at least a majority of the shares of Registrable Securities and
(a) if Westinghouse is still a holder of the Option or any Registrable
-
Securities, the written consent of Westinghouse or (b) if Westinghouse is no
-
longer the holder of the Option or any Registrable Securities and the C&D Fund
and its Affiliates continue to own a percentage of the Registrable Securities
that is greater than the percentage of Registrable Securities held in the
aggregate by Westinghouse's successors and permitted
42
assigns, the written consent of Westinghouse's successors or permitted assigns
holding a majority in interest of the Registrable Securities held by
Westinghouse's successors and permitted assigns, treating, for the purposes of
this clause (b), any unexercised portion of the Option as the Registrable
Securities issuable upon exercise thereof. Each holder of the Option or any
Registrable Securities at the time or thereafter outstanding shall be bound by
any consent authorized by this Section 7.2, whether or not the Option or such
Registrable Securities shall have been marked to indicate such consent. No
amendment, modification or discharge of this Agreement, and no waiver hereunder,
shall be valid or binding unless set forth in writing. Any such waiver shall
constitute a waiver only with respect to the specific matter described in such
writing and shall in no way impair the rights of the party or parties granting
such waiver in any other respect or at any other time.
7.3. Nominees for Beneficial Owners. In the event that any
------------------------------
Registrable Securities are held by a nominee for the beneficial owner thereof,
the beneficial owner thereof may, at its election and unless notice is otherwise
given to the Company by the record owner, be treated as the holder of such
Registrable Securities for purposes of any request or other action by any holder
or holders of Registrable Securities pursuant to this Agreement or any
determinnation of any number or percentage of shares of Registrable Securities
held by any holder or holders of Registrable Securities contemplated by this
Agreement. If the beneficial owner of any Registrable Securities so elects, the
Company may require assurances reasonably satisfactory to it of such owner's
beneficial ownership of such Registrable Securities.
7.4. Successors, Assigns and Transferees. This Agreement shall be
-----------------------------------
binding upon and shall inure to the benefit of the parties hereto and their
respective successors and assigns. In addition, and whether or not any express
assignment shall have been made, the provisions of this Agreement which are for
the benefit of the parties hereto
43
other than the Company shall also be for the benefit of and enforceable by any
subsequent holder of the Option or any Registrable Securities, subject to the
provisions respecting the minimum numbers or percentages of shares of
Registrable Securities required in order to be entitled to certain rights, or
take certain actions, contained herein, provided that, upon any transfer by
--------
Westinghouse of the Option or of any Registrable Securities, the rights granted
in Sections 3 and 5 to Westinghouse or its permitted assignee (as opposed to the
holders of Registrable Securities generally) shall not be enforceable by any
subsequent holder of the Option or such Registrable Securities unless
Westinghouse expressly assigns such rights (which may be assigned by
Westinghouse in part) and notifies the Company of such assignment, provided
---------
further that Westinghouse's rights under Sections 3.4(c) and 5.2(d) are personal
-------
to Westinghouse and shall not be assignable or otherwise transferable and any
attempt to assign or transfer such rights shall be void and of no effect.
7.5. Notices. All notices and other communications in connection
-------
with this Agreement shall be in writing. Any notice or other communication in
connection herewith shall be deemed duly given to any party (a) two Business
-
Days after it is sent by express, registered or certified mail, return receipt
requested, postage prepaid or (b) one Business Day after it is sent by overnight
-
courier, in each case, to the address of such party set forth beneath its name
on the schedules hereto, or to such other address as such party may have
designated to the Company in writing, or if to any holder of Registrable
Securities not a party hereto on the date hereof, at the address of such
holder in the stock record books of the Company, and if to the Company or the
C&D Fund to the following addresses:
44
(i) if to the Company, to:
CDW Holding Corporation
c/o The Xxxxxxx & Dubilier Private Equity
Fund IV Limited Partnership
000 Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
Attention: Xxxxxxx & Dubilier Associates IV
---------
Limited Partnership
Attention: Xxxxxx X. Xxxx, III
(ii) if to the C&D Fund, to:
The Xxxxxxx & Dubilier Private Equity
Fund IV Limited Partnership
000 Xxxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxxxxx 00000
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
Attention: Xxxxxxx & Dubilier Associates IV
---------
Limited Partnership
Attention: Xxxxxx X. Xxxx, III
or at such other address or addresses as the Company or the C&D Fund, as the
case may be, may have designated in writing to each holder of Registrable
Securities at the time outstanding. Copies of any notice or other
communication given under the Agreement shall also be given to:
Xxxxxxx, Dubilier & Rice, Inc.
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
Attention: Xxxxxxx Xxxxxxxx
---------
45
Debevoise & Xxxxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
Attention: Xxxxxx Xxxxxx, Esq.
---------
Any party may give any notice or other communication in connection herewith
using any other means (including, but not limited to, personal delivery,
messenger service, telecopy, telex or ordinary mail), but no such notice or
other communication shall be deemed to have been duly given unless and until it
is actually received by the individual for whom it is intended.
7.6. No Inconsistent Agreements. The Company will not hereafter
--------------------------
enter into any agreement with respect to its securities which is inconsistent
with the rights granted to the holders of Registrable Securities by this
Agreement.
7.7. Remedies; Attorneys' Fees. The holder of the Option and each
-------------------------
holder of Registrable Securities, in addition to being entitled to exercise all
rights provided herein or granted by law, including recovery of damages, will be
entitled to specific performance of its rights under this Agreement. The
Company agrees that monetary damages would not be adequate compensation for any
loss incurred by reason of a breach by it of any provision of this Agreement and
hereby agrees to waive the defense in any action for specific performance that a
remedy at law would be adequate.
7.8. Stock Splits, etc. Each party hereto agrees that it will vote
-----------------
to effect a stock split (forward or reverse, as the case may be) with respect
to any Registrable Securities in connection with any registration of such
Registrable Securities hereunder, or otherwise, if the managing underwriter
shall advise the Company in writing (or, in connection with an offering that is
not underwritten, if an investment banker shall advise the Company in writing)
that in their or its opinion such a stock split would facilitate
46
or increase the likelihood of success of the offering. Each party hereto agrees
that any number of shares of Common Stock referred to in this Agreement shall be
equitably adjusted to reflect any stock split, stock dividend, stock
combination, recapitalization or similar transaction.
7.9. Term. This Agreement shall be effective as of the date hereof
----
and shall continue in effect thereafter until the earliest of (a) its
-
termination by the consent of the parties hereto or their respective successors
in interest, (b) the date on which the Option shall have been exercised in
-
full or shall have terminated and no Registrable Securities remain outstanding
and (c) the dissolution, liquidation or winding up of the Company.
-
7.10. Severability. If any provision of this Agreement is
------------
inoperative or unenforceable for any reason, such circumstances shall not have
the effect of rendering the provision in question inoperative or unenforceable
in any other case or circumstance, or of rendering any other provision or
provisions herein contained invalid, inoperative, or unenforceable to any
extent whatsoever. The invalidity of any one or more phrases, sentences,
clauses, Sections or subsections of this Agreement shall not affect the
remaining portions of this Agreement.
7.11. Headings. The headings contained in this Agreement are for
--------
purposes of convenience only and shall not affect the meaning or interpretation
of this Agreement.
7.12. Counterparts. This Agreement may be executed in several
------------
counterparts, each of which shall be deemed an original and all of which
together constitute one and the same instrument.
7.13. Governing Law. This Agreement shall be governed in all
-------------
respects, including, but not limited to, as to validity, interpretation and
effect, by the internal laws of the State of New York, without giving effect to
the conflict of law rules thereof.
47
7.14. No Third Party Beneficiaries. Except as provided in Sections
----------------------------
3.7 and 7.4, nothing in this Agreement shall confer any rights upon any person
or entity other than the parties hereto, each such party's respective successors
and permitted assigns.
7.15. Consent to Jurisdiction. Each party irrevocably submits to
-----------------------
the exclusive jurisdiction of (a) the Supreme Court of the State of New York,
-
New York County, and (b) the United States District Court for the Southern
-
District of New York, for the purposes of any suit, action or other proceeding
arising out of this Agreement or any transaction contemplated hereby (and
agrees not to commence any such suit, action or proceeding except in such
courts). Each party further agrees that service of any process, summons, notice
or document by U.S. registered mail to such party's respective address set forth
above shall be effective service of process for any such suit, action or
proceeding. Each party irrevocably and unconditionally waives any objection to
the laying of venue of any such suit, action or proceeding in (i) the Supreme
-
Court of the State of New York, New York County, and (ii) the United States
--
District Court for the Southern District of New York, that any such suit, action
or proceeding brought in any such court has been brought in an inconvenient
forum.
7.16. Waiver of Jury Trial. Each party hereby waives, to the fullest
--------------------
extent permitted by applicable law, any right it may have to a trial by jury in
respect of any suit, action or proceeding arising out of this Agreement or any
transaction contemplated hereby. Each party (a) certifies that no
-
representative, agent or attorney of any other party has represented, expressly
or otherwise, that such other party would not, in the event of litigation, seek
to enforce the foregoing waiver and (b) acknowledges that it and the other
-
parties have been induced to enter into the Agreement by, among other things,
the mutual waivers and certifications in this Section 7.16.
48
IN WITNESS WHEREOF, each of the undersigned has executed this
Agreement or caused this Agreement to be executed on its behalf as of the date
first written above.
CDW HOLDING CORPORATION
By: /s/ Xxxxxxxxx X. Xxxxxxx
-----------------------------------
Name: Xxxxxxxxx X. Xxxxxxx
Title: Vice President & Assistant
Secretary
THE XXXXXXX & DUBILIER PRIVATE
EQUITY FUND IV LIMITED PARTNERSHIP
By: Xxxxxxx & Dubilier Associates IV
Limited Partnership, the
General Partner
By: /s/ Xxxxxxx Xxxxxxxx
-----------------------------
a general partner
WESTINGHOUSE ELECTRIC CORPORATION
By: /s/ Xxxxxx X. Xxxxxxxx
----------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: Executive Vice President
Address:
Westinghouse Electric Corporation
Westinghouse Building
Gateway Center
00 Xxxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Telecopy: (000) 000-0000
49
Telephone: (000) 000-0000
Attention: Treasurer
XXX X. XXXXX
/s/ Xxx X. Xxxxx
----------------------------------
Address: 000 Xxxxxx Xxx Xxxxx
Xxxxxxx, Xxxxx 00000
50
