Exhibit 10.15.1
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AMENDED AND RESTATED
INVESTORS AGREEMENT
DATED AS OF
APRIL 9, 1998
AMONG
IPC INFORMATION SYSTEMS, INC.
CABLE SYSTEMS HOLDING, LLC
CABLE SYSTEMS INTERNATIONAL, INC.
AND
CERTAIN OTHER PERSONS NAMED HEREIN
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TABLE OF CONTENTS
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PAGE
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ARTICLE 1 DEFINITIONS
Section 1.01. Definitions............................................. 1
ARTICLE 2 CORPORATE GOVERNANCE AND MANAGEMENT
Section 2.01. Composition of the Board................................ 5
Section 2.02. Removal................................................. 5
Section 2.03. Vacancies............................................... 5
Section 2.04. Action by the Board..................................... 5
Section 2.05. Conflicting Charter or Bylaw Provision.................. 6
Section 2.06. IXNET Board............................................. 6
ARTICLE 3 RESTRICTIONS ON TRANSFER
Section 3.01. General................................................. 6
Section 3.02. Legends................................................. 6
Section 3.03. Permitted Transferees................................... 6
Section 3.04. Restrictions on Transfers by Xxxxxxxxxxx Shareholders... 6
Restrictions on Transfers by Xxxxx Shareholders and
Section 3.05. Xxxxxxxx Shareholders................................... 7
ARTICLE 4 TAG-ALONG RIGHTS; DRAG-ALONG RIGHTS
Section 4.01. Rights to Participate in Transfer....................... 7
Section 4.02. Right to Compel Participation in Certain Transfers...... 8
ARTICLE 5 REGISTRATION RIGHTS
Section 5.01. Demand Registration..................................... 10
Section 5.02. Piggyback Registration.................................. 11
Section 5.03. Holdback Agreements..................................... 12
Section 5.04. Registration Procedures................................. 12
Section 5.05. Indemnification by the Company.......................... 14
Section 5.06. Indemnification by Participating Shareholders........... 15
Section 5.07. Conduct of Indemnification Proceedings.................. 15
Section 5.08. Contribution............................................ 16
Section 5.09. Participation in Public Offering........................ 16
Section 5.10. Rule 144................................................ 17
Section 5.11. No Transfer of Registration Rights...................... 17
ARTICLE 6 CERTAIN COVENANTS AND AGREEMENTS
Section 6.01. Limitations on Subsequent Registration.................. 17
Section 6.02. Limitation on Purchase of Common Stock.................. 17
ARTICLE 7 MISCELLANEOUS
Section 7.01. Entire Agreement........................................ 17
Section 7.02. Binding Effect; Benefit................................. 17
Section 7.03. Assignability........................................... 18
Section 7.04. Amendment; Waiver; Termination.......................... 18
Section 7.05. Notices................................................. 18
Section 7.06. Headings................................................ 20
Section 7.07. Counterparts............................................ 20
Section 7.08. Governing Law........................................... 20
Section 7.09. Specific Enforcement.................................... 20
Section 7.10. Certain Actions......................................... 20
Section 7.11. Consent to Jurisdiction; Expenses....................... 21
Section 7.12. Severability............................................ 21
Section 7.13. Schedule I.............................................. 21
Section 7.14. Effectiveness........................................... 21
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Schedule I Securities Ownership
Exhibit A Form of Joinder Agreement
ii
AMENDED AND RESTATED INVESTORS AGREEMENT
AMENDED AND RESTATED INVESTORS AGREEMENT, dated as of April 9, 1998, among (i)
IPC Information Systems, Inc. (the "Company"), (ii) Cable Systems Holding, LLC,
a Delaware limited liability company ("CSH"), (iii) Cable Systems International,
Inc., a Delaware Corporation, (iv) Xxxxxxx Xxxxxxxxxxx, (v) Xxxxx Xxxxx, (vi)
Xxxxxxx Xxxxxxxx and (vii) Xxxxxxxx, Xxxxx & Xxxxx III, L.P., a Delaware limited
partnership.
W I T N E S S E T H:
WHEREAS, pursuant to the terms of the Merger Agreement (as defined below),
Arizona Acquisition Corp. will be merged with and into the Company, with the
Company as the surviving corporation (the "Merger");
WHEREAS, at the Effective Time (as defined in the Merger Agreement) the
parties hereto will hold securities of the Company as set forth on Schedule I to
be attached hereto at the Effective Time;
WHEREAS, the parties hereto desire to enter into this Agreement to govern
certain of their rights, duties and obligations after consummation of the
transactions contemplated by the Merger Agreement;
The parties hereto agree as follows:
ARTICLE 1
DEFINITIONS
Section 1.01. Definitions. (a) The following terms, as used herein, have the
following meanings:
"Adverse Person" means any Person whom the Board of Directors of the Company
may reasonably determine to be a competitor or a potential competitor of the
Company or its Subsidiaries.
"Affiliate" means, with respect to any Person, any other Person directly or
indirectly controlling, controlled by, or under common control with such Person,
provided that no securityholder of the Company shall be deemed an Affiliate of
any other securityholder solely by reason of any investment in the Company. For
the purpose of this definition, the term "control" (including with correlative
meanings, the terms "controlling", "controlled by" and "under common control
with"), as used with respect to any Person, shall mean the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of such Person, whether through the ownership of voting securities
or by contract or otherwise.
"beneficially own" shall have the meaning set forth in Rule 13d-3 of the
Exchange Act.
"Board" means the board of directors of the Company.
"Business Day" means any day except a Saturday, Sunday or other day on which
commercial banks in New York City are authorized by law to close.
"Change of Control" means such time as (a) the CSH Shareholders shall own less
than 20% of the outstanding shares of Common Stock, (b) the transfer of all or
substantially all of the assets of the Company to any Person or group shall have
been consummated, or (c) the Company shall have been liquidated.
"Closing Date" shall have the meaning ascribed thereto in the Merger
Agreement.
"Common Stock" shall mean the common stock, par value $.01 per share, of the
Company and any stock into which such Common Stock may thereafter be converted
or changed; provided, however, that in the event of a stock dividend, split-up,
recapitalization, combination, exchange of stock or the like in respect of such
Common Stock, the term "Common Stock" shall be deemed to refer to and include
the stock as well as all stock dividends and distributions and any stock into
which or for which any or all of such stock may be changed or exchanged.
"CSH Entities" means (a) CSH and (b) Cable Systems International Inc., a
Delaware Corporation.
"CSH Shareholders" means the CSH Entities and their direct and indirect
Permitted Transferees so long as any such Person shall beneficially own any
Common Stock.
"Drag-Along Portion" means, with respect to any Xxxxxxxxxxx Shareholder, any
Xxxxx Shareholder any Xxxxxxxx Shareholder or any LSH Shareholder, the number of
Shares beneficially owned by such Xxxxxxxxxxx Shareholder, Xxxxx Shareholder,
Xxxxxxxx Shareholder or any LSH Shareholder multiplied by a fraction, the
numerator of which is the number of Shares to be sold by the CSH Shareholders on
behalf of the CSH Shareholders and the Xxxxxxxxxxx Shareholders, the Xxxxx
Shareholders, the Xxxxxxxx Shareholders and the LSH Shareholders and the
denominator of which is the total number of Shares then beneficially owned by
all of the Shareholders.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Fully Diluted" means all outstanding shares of Common Stock and all shares
issuable in respect of securities convertible into or exchangeable or
exercisable for such Common Stock, stock appreciation rights or options,
warrants and other irrevocable rights to purchase or subscribe for such Common
Stock or securities convertible into or exchangeable or exercisable for such
Common Stock; provided that no Person shall be deemed to own such number of
Fully Diluted shares of any Common Stock as such Person has the right to acquire
from any Person other than the Company.
"Initial Ownership" means, with respect to any Shareholder, the number of
shares of Common Stock beneficially owned (and (without duplication) which such
Persons have the right to acquire from any Person) as of the Effective Time, or
in the case of any Person that shall become a party to this Agreement on a later
date, as of such date, taking into account any stock split, stock dividend,
reverse stock split or similar event.
"Xxxxxxxxxxx Shareholders" means Xxxxxxx Xxxxxxxxxxx and his direct and
indirect Permitted Transferees so long as any such Person shall beneficially own
any Common Stock.
"LSH" means Xxxxxxxx, Xxxxx & Xxxxx III, L.P.
"LSH Shareholders" means LSH and its direct and indirect Permitted Transferee
so long as any such Person shall beneficially own any Common Stock.
"Merger Agreement" means the Agreement and Plan of Merger dated as of the date
hereof, as subsequently amended, between the Company and Arizona Acquisition
Corp.
"Permitted Transferee" means (i) in the case of any Shareholder who is a
natural person, (a) a spouse or lineal descendent (including by adoption and
stepchildren), heir, executor, testamentary trustee or legatee of such
Shareholder or (b) any trust or estate the beneficiaries of which, or any
corporation, limited liability company or partnership, the stockholders, members
or partners of which include only the Persons described in clause (a) above,
(ii) in the case of any CSH Shareholder, (a) Citicorp Venture Capital, Ltd., any
stockholder, member, partner or Affiliate of any such CSH Shareholder or of
Citicorp Venture Capital, Ltd. and any officer, director, or employee of any
such CSH Shareholder, Citicorp Venture Capital, Ltd. or of any such stockholder,
member, partner or Affiliate, (b) a spouse or lineal descendant (including by
adoption and stepchildren), heir, executor, testamentary trustee or legatee of
the officers, directors and employees referred to in clause (ii)(a) above, and
any trust or estate (where a majority in interest of the beneficiaries thereof
are any of the Persons described in this clause (b) and in clause (ii)(a)
above), corporation, limited liability company or partnership (where a majority
in interest of the stockholders, members or limited partners, or where the
managing general partner, is one of more of the Persons described in this clause
(b) or in clause (ii)(a) above and (iii) in the case of any LSH Shareholder, (a)
any shareholder, member, partner or Affiliate of such LSH Shareholder or (b) a
spouse or lineal descendant (including by adoption and stepchildren), heir,
executor, testamentary trustee or legatee of the shareholders, members and
partners referred to in clause (iii)(a) above, and any trust or estate (where a
majority
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in interest of the beneficiaries thereof are any of the Persons described in
this clause (b) and in clause (iii)(a) above), corporation, limited liability
company or partnership (where a majority in interest of the stockholders,
members or limited partners, or where the managing general partner, is one of
more of the Persons described in this clause (b) or in clause (iii)(a) above.
"Person" means an individual, corporation, limited liability company,
partnership, association, trust or other entity or organization, including a
government or political subdivision or an agency or instrumentality thereof.
"Pro Rata Portion" means the number of Shares a Shareholder holds multiplied
by a fraction, the numerator of which is the number of Shares to be sold by the
CSH Shareholders, the Xxxxxxxxxxx Shareholders, the Xxxxx Shareholders, the
Xxxxxxxx Shareholders and the LSH Shareholders in a Public Offering and the
denominator of which is the total number of Shares, on a Fully Diluted basis,
held in the aggregate by the CSH Shareholders, the Xxxxxxxxxxx Shareholders, the
Xxxxx Shareholders, the Xxxxxxxx Shareholders and the LSH Shareholders
immediately prior to such Public Offering.
"Public Offering" means any primary or secondary public offering of shares of
Common Stock pursuant to an effective registration statement under the
Securities Act other than pursuant to a registration statement filed in
connection with a transaction of the type described in Rule 145 of the
Securities Act or for the purpose of issuing securities pursuant to an employee
benefit plan.
"Registrable Securities" means at any time, with respect to any Shareholder,
any shares of Common Stock then owned by such Shareholder until (i) a
registration statement covering such securities has been declared effective by
the SEC and such securities have been disposed of pursuant to such effective
registration statement, (ii) such securities are sold to the public pursuant to
Rule 144 (or any similar provisions then in force) under the Securities Act or
(iii) such securities are otherwise transferred, the Company has delivered a new
certificate or other evidence of ownership for such securities not bearing the
legend required pursuant to this Agreement and such securities are freely
tradeable without restriction by the holder thereof under the Securities Act.
"Registration Expenses" means (i) all registration and filing fees, (ii) fees
and expenses of compliance with securities or blue sky laws (including
reasonable fees and disbursements of counsel in connection with blue sky
qualifications of the securities registered), (iii) printing expenses, (iv)
internal expenses of the Company (including, without limitation, all salaries
and expenses of its officers and employees performing legal or accounting
duties), (v) reasonable fees and disbursements of counsel for the Company and
customary fees and expenses for independent certified public accountants
retained by the Company (including expenses relating to any comfort letters or
costs associated with the delivery by independent certified public accountants
of a comfort letter or comfort letters requested pursuant to Section 5.04(g)
hereof), (vi) the reasonable fees and expenses of any special experts retained
by the Company in connection with such registration, (vii) reasonable fees and
expenses of up to one counsel for the Shareholders participating in the
offering, (viii) fees and expenses in connection with any review of underwriting
arrangements by the National Association of Securities Dealers, Inc. (the
"NASD"), including fees and expenses of any "qualified independent underwriter"
and (ix) fees and disbursements of underwriters customarily paid by issuers or
sellers of securities, but shall not include any underwriting fees, discounts or
commissions attributable to the sale of Registrable Securities, or any
out-of-pocket expenses (except as set forth in clause (vii) above) of the
Shareholders.
"SEC" means the Securities and Exchange Commission.
"Securities Act" means the Securities Act of 1933, as amended.
"Xxxxxxxx Shareholders" means Xxxxxxx Xxxxxxxx and his direct and indirect
Permitted Transferees so long as any such Person shall beneficially own any
Common Stock.
"Shareholder" means each Person (other than the Company) who shall be a party
to this Agreement, whether in connection with the execution and delivery hereof
as of the date hereof, pursuant to Section 7.03 or otherwise, so long as such
Person shall beneficially own any Common Stock.
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"Shares" means shares of Common Stock held by the Shareholders.
"Subject Securities" means the Common Stock beneficially owned by the
Xxxxxxxxxxx Shareholders, the Xxxxx Shareholders and the Xxxxxxxx Shareholders
and the LSH Shareholders to be transferred in a Section 4.02 Sale.
"Subsidiary" means, with respect to any Person, any entity of which securities
or other ownership interests having ordinary voting power to elect a majority of
the board of directors or other persons performing similar functions are at the
time directly or indirectly owned by such Person.
"Tag-Along Portion" means the number of Shares held by the Tagging Person or
the Selling Person, as the case may be, multiplied by a fraction, the numerator
of which is the number of Shares proposed to be sold by the Selling Person
pursuant to Section 4.01, and the denominator of which is the aggregate number
of Shares, on a Fully Diluted basis, then owned by the Selling Person.
"Third Party" means a prospective purchaser of Common Stock from a Shareholder
where such purchaser is not a Permitted Transferee of such Shareholder or an
entity in which such Shareholder or any of its Permitted Transferees directly or
indirectly owns any outstanding securities or other ownership interests having
ordinary voting power.
"Underwritten Public Offering" means a firmly underwritten public offering of
Registrable Securities of the Company pursuant to an effective registration
statement under the Securities Act.
"Xxxxx Shareholders" means Xxxxx and his direct and indirect Permitted
Transferees so long as any such Person shall beneficially own any Common Stock.
(b) Each of the following terms is defined in the Section set forth opposite
such term:
TERM SECTION
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Cause......................................................... 2.02
Demand Registration........................................... 5.01(a)
Drag-Along Rights............................................. 4.02(a)
Free Percentage............................................... 4.01(a)
Holders....................................................... 5.01(a)(ii)
Indemnified Party............................................. 5.07
Indemnifying Party............................................ 5.07
Inspectors.................................................... 5.04(g)
Joinder Agreement............................................. 3.03
Maximum Offering Size......................................... 5.01(e)
Nominee....................................................... 2.03(a)
Piggyback Registration........................................ 5.02(a)
Records....................................................... 5.04(g)
Section 4.01 Response Notice.................................. 4.01(a)
Section 4.02 Sale............................................. 4.02(a)
Section 4.02 Notice........................................... 4.02(a)
Section 4.02 Sale Price....................................... 4.02(a)
Section 4.02 Notice Period.................................... 4.02(a)
Selling Person................................................ 4.01(a)
Selling Shareholder........................................... 5.01(a)
Tag-Along Notice.............................................. 4.01(a)
Tag-Along Notice Period....................................... 4.01(a)
Tag-Along Offer............................................... 4.01(a)
Tag-Along Right............................................... 4.01(a)
Tag-Along Sale................................................ 4.01(a)
Tagging Person................................................ 4.01(a)
Transfer...................................................... 3.01(a)
Xxxxx......................................................... Preamble
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ARTICLE 2
CORPORATE GOVERNANCE AND MANAGEMENT
Section 2.01. Composition of the Board. The Board shall consist of nine
members, of whom (i) three shall be nominated by the CSH Shareholders, (ii) two
shall be nominated by the CSH Shareholders and shall be individuals which are
not "Affiliates" or "Associates" (as those terms are used within the meaning of
Rule 12b-2 of the General Rules and Regulations under the Exchange Act) of any
Shareholder or its Affiliates, (iii) two shall be nominated by the CSH
Shareholders and shall be individuals who are executive officers of the Company
or its Subsidiaries and (iv) two shall be nominated by the Xxxxxxxxxxx
Shareholders. Each Shareholder entitled to vote for the election of directors to
the Board agrees that it will vote its shares of Common Stock or execute
consents, as the case may be, and take all other necessary action (including
causing the Company to call a special meeting of shareholders) in order to
ensure that the composition of the Board is as set forth in this Section 2.01;
provided that, no Shareholder shall be required to vote for the CSH
Shareholders' or the Xxxxxxxxxxx Shareholders' nominee(s) , as applicable, if
the number of Shares held by the group of Shareholders, as applicable, making
the nomination is, at the close of business on the day preceding such vote or
execution of consents, (x) less than 5% of the outstanding number of Shares of
Common Stock, in the case of the CSH Shareholders or (y) less than 50% of its
Initial Ownership of Common Stock, in the case of the Xxxxxxxxxxx Shareholders.
Section 2.02. Removal. Subject to applicable law, each Shareholder agrees that
if, at any time, it is then entitled to vote for the removal of directors of the
Company, it will not vote any of its Shares in favor of the removal of any
director who shall have been designated or nominated pursuant to Section 2.01
unless such removal shall be for Cause or the Person(s) entitled to designate or
nominate such director shall have consented to such removal in writing, provided
that if the Persons entitled to designate or nominate any director pursuant to
Section 2.01 shall request the removal, with or without Cause, of such director
in writing, each such Shareholder shall vote its shares of Common Stock in favor
of such removal. Removal for "Cause" shall mean removal of a director because of
such director's (a) willful and continued failure substantially to perform his
duties with the Company in his established position, (b) willful conduct which
is injurious to the Company or any of its Subsidiaries, monetarily or otherwise,
(c) conviction for, or guilty plea to, a felony or a crime involving moral
turpitude, or (d) abuse of illegal drugs or other controlled substances or
habitual intoxication.
Section 2.03. Vacancies. If, as a result of death, disability, retirement,
resignation, removal (with or without Cause) or otherwise, there shall exist
or occur any vacancy on the Board:
(a) The Shareholder(s) entitled under Section 2.01 to nominate such director
whose death, disability, retirement, resignation or removal resulted in such
vacancy, may, subject to the provisions of Section 2.01, nominate another
individual (the "Nominee") to fill such vacancy and serve as a director of the
Company; and
(b) each Shareholder then entitled to vote for the election of the Nominee
as a director of the Company agrees that it will vote its Shares, or execute a
written consent, as the case may be, in order to ensure that the Nominee be
elected to the Board; provided that, no Shareholder shall be required to vote
for another party's Nominee(s) if the aggregate number of Shares held by the
Shareholder or group of Shareholders, as applicable, making the nomination is,
at the close of business of the day preceding such vote or execution of
consents, less than (x) 5% of the outstanding number of Shares of Common
Stock, in the case of the CSH Shareholders or (y) less than 50% of the Initial
Ownership of Common Stock, in the case of the Xxxxxxxxxxx Shareholders.
Section 2.04. Action by the Board. (a) A quorum at any meeting of the Board
shall consist of five directors.
(b) All actions of the Board shall require the affirmative vote of at least a
majority of the directors present at a duly convened meeting of the Board at
which a quorum is present or the unanimous written consent of the Board;
provided that, in the event there is a vacancy on the Board and an individual
has been nominated to fill such vacancy, the first order of business shall be to
fill such vacancy.
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Section 2.05. Conflicting Charter or Bylaw Provision. Each Shareholder shall
vote its Shares, and shall take all other actions reasonably necessary, to
ensure that the Company's certificate of incorporation and bylaws are consistent
with, facilitate and do not at any time conflict with any provision of this
Agreement.
Section 2.06. IXNET Board. For so long as (a) International Exchange Network
Ltd, a Delaware corporation ("IXNET") is a wholly-owned Subsidiary of the
Company and (b) Xxxxx Xxxxx is an employee of IXNET, the Company shall cause
Xxxxx Xxxxx to be a member of the board of directors of IXNET.
ARTICLE 3
RESTRICTIONS ON TRANSFER
Section 3.01. General. (a) Each Shareholder agrees that it will not, directly
or indirectly, sell, assign, transfer, grant a participation in, pledge or
otherwise dispose of ("transfer") any Common Stock (or solicit any offers to buy
or otherwise acquire, or take a pledge of any Common Stock) except in compliance
with the Securities Act and the terms and conditions of this Agreement.
(b) Any attempt to transfer any Common Stock not in compliance with this
Agreement shall be null and void and the Company shall not, and shall cause any
transfer agent not to, give any effect in the Company's stock records to such
attempted transfer.
Section 3.02. Legends. (a) In addition to any other legend that may be
required, each certificate for shares of Common Stock that is issued to any
Shareholder shall bear a legend in substantially the following form:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED OR OTHERWISE
TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT OR IN
ACCORDANCE WITH AN EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE
SECURITIES ACT OF 1933, AS AMENDED. SHARES REPRESENTED BY THIS CERTIFICATE ARE
SUBJECT TO RESTRICTIONS ON TRANSFER AS SET FORTH IN THE INVESTORS AGREEMENT
DATED AS OF DECEMBER 18, 1997, COPIES OF WHICH MAY BE OBTAINED UPON REQUEST
FROM IPC INFORMATION SYSTEMS, INC. OR ANY SUCCESSOR THERETO."
(b) If any Common Stock shall cease to be subject to any and all restrictions
on transfer set forth in this Agreement, the Company shall, upon the written
request of the holder thereof, issue to such holder a new certificate evidencing
such Common Stock without the legend required by Section 3.02(a) endorsed
thereon.
Section 3.03. Permitted Transferees. Any Shareholder may at any time transfer
any or all of its Shares to one or more of its Permitted Transferees without the
consent of the Company or any Shareholder or group of Shareholders and without
compliance with Sections 3.04 and 4.01 so long as (a) such Permitted Transferee
shall have executed a Joinder Agreement substantially in the form of Exhibit A
hereto ("Joinder Agreement") and thereby agreed to be bound by the terms of this
Agreement and (b) the transfer to such Permitted Transferee is not in violation
of applicable federal or state securities laws.
Section 3.04. Restrictions on Transfers by Xxxxxxxxxxx Shareholders. (a)
Except as provided in Section 3.03, the Xxxxxxxxxxx Shareholders may transfer
their Common Stock only as follows:
(i) in a transfer made in compliance with Section 4.01 or Section 4.02;
(ii) in a Public Offering in connection with the exercise of their rights
under Article 5 hereof; or
(iii) following the earlier to occur of (i) the date on which the number of
Shares held by the Xxxxxxxxxxx Shareholders is less than 5% of the outstanding
number of Shares of Common Stock and (ii) the fifth anniversary of the Closing
Date, to any Person other than any Adverse Person.
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(b) The restrictions set forth in Section 3.04 shall terminate at such time as
the aggregate number of Shares of Common stock held by the CSH Shareholders is
less than 50% of the CSH Shareholders' aggregate Initial Ownership of Common
Stock.
Section 3.05. Restrictions on Transfers by Xxxxx Shareholders and Xxxxxxxx
Shareholders. Except as provided in Section 3.03, the Xxxxx Shareholders and the
Xxxxxxxx Shareholders may transfer their Common Stock only as follows:
(i) in a transfer made in compliance with Section 4.01 of Section 4.02;
or
(ii) in any Public Offering; or
(iii) following the 30th month anniversary of the Closing Date, to any
Person other than any Adverse Person; or
(iv) to any Person, in a transfer through a broker or dealer in compliance
with Rule 144 (or any successor rule).
Section 3.06. Restrictions on Transfers by LSH Shareholders. Except as
provided in Section 3.03, the LSH Shareholders may transfer their Common Stock
only as follows:
(i) in a transfer made in compliance with Section 4.01 of Section 4.02;
or
(ii) in any Public Offering; or
(iii) to any Person, in a transfer through a broker or dealer in compliance
with Rule 144 (or any successor rule).
ARTICLE 4
TAG-ALONG RIGHTS; DRAG-ALONG RIGHTS
Section 4.01. Rights to Participate in Transfer. (a) If CSH Shareholders (the
"Selling Person") propose to, directly or indirectly, transfer (other than
transfers of Shares (i) in a Public Offering, (ii) to any Permitted Transferee
of any of the CSH Shareholders, (iii) up to 3% in the aggregate of the
securities of such class outstanding on the date of the first transfer of any
Shares by any of the CSH Shareholders (such percentage, the "Free Percentage")
or (iv) that will indirectly result from a sale of all or substantially all of
the capital stock or assets of CSH, CSI, Cable Systems Holding Company, Citicorp
or any of its Subsidiaries) shares of Common Stock (a "Tag-Along Sale"), the
Xxxxxxxxxxx Shareholders and/or the Xxxxx Shareholders and/or the Xxxxxxxx
Shareholders and/or the LSH Shareholders may, at their option, elect to exercise
their rights under this Section 4.01 (each such Shareholder, a "Tagging
Person"). In the event of such a proposed transfer, the Selling Person shall
provide each Xxxxxxxxxxx Shareholder, each Xxxxx Shareholder, each Xxxxxxxx
Shareholder, each LSH Shareholder and the Company written notice of the material
terms and conditions of such proposed transfer ("Tag-Along Notice") and offer
each Tagging Person the opportunity to participate in such sale. The Tag-Along
Notice shall identify the number of shares of Common Stock subject to the offer
("Tag-Along Offer"), the consideration for which the transfer is proposed to be
made and all other material terms and conditions of the Tag-Along Offer. Each
Tagging Person shall have the right (a "Tag-Along Right"), exercisable by
irrevocable written notice (a "Section 4.01 Response Notice") given within 10
Business Days from receipt of the Tag-Along Notice (the "Tag-Along Notice
Period") to participate in such Tag-Along Sale on the same terms and conditions
as set forth in the Tag-Along Notice and to sell all or any portion of its
Tag-Along Portion. If the Tagging Persons exercise their Tag-Along Rights
hereunder, each Tagging Person shall deliver at least two business days prior to
the date scheduled for the closing of the Tag-Along Sale to the Selling Person
for delivery to the prospective transferee one or more certificates, in a proper
form for transfer, representing the Shares of such Tagging Person to be included
in the Tag-Along Sale. Such certificate or certificates that a Tagging Person
delivers to the Selling Person shall be delivered on the date scheduled for the
closing of the Tag-Along Sale to such transferee in consummation of the
Tag-Along Sale. Notwithstanding anything to the contrary contained in this
Section 4.01, except for the Selling Person's obligation to return to each
Tagging Person any certificates representing the Tagging Person's Shares there
shall be no liability on the part of the Selling Person to any Shareholder in
the event that the proposed Tag-Along Sale is not consummated for whatever
reason. Whether a Tag-Along Sale is effected pursuant to this Section 4.01 by
the Selling Person is in the sole and absolute discretion of the Selling Person.
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(b) Concurrently with the consummation of the Tag-Along Sale, the Selling
Person shall notify the Tagging Persons thereof, shall remit to the Tagging
Persons the total consideration (by bank or certified check) for the Shares of
the Tagging Persons transferred pursuant thereto, and shall, promptly after the
consummation of such Tag-Along Sale, furnish such other evidence of the
completion and time of completion of such transfer and the terms thereof as may
be reasonably requested by the Tagging Persons.
(c) If at the termination of the Tag-Along Notice Period any Tagging Person
shall not have elected to participate in the Tag-Along Sale, such Tagging Person
will be deemed to have waived its rights under Section 4.01(a) with respect to
the transfer of its securities pursuant to such Tag-Along Sale.
(d) If any Tagging Person declines to exercise its Tag-Along Rights or elects
to exercise its Tag-Along Rights with respect to less than such Tagging Person's
Tag-Along Portion, the CSH Shareholders shall be entitled to transfer, pursuant
to the Tag-Along Offer, a number of Shares held by the CSH Shareholders equal to
the number of Shares constituting the portion of such Tagging Person's Tag-Along
Portion with respect to which Tag-Along Rights were not exercised.
(e) The CSH Shareholders and any Tagging Person who exercises the Tag-Along
Rights pursuant to this Section 4.01 may consummate the Tag-Along Sale on
substantially the same terms and conditions set forth in the Tag-Along Notice
(provided, however, that the price payable in any such sale may exceed the price
specified in the Tag-Along Notice by up to 5%) within 120 days of the date on
which Tag-Along Rights shall have been waived, exercised or expire.
(f) The exercise or the non-exercise of the rights of the Tagging Persons to
participate in one or more Tag-Along Sales shall not adversely affect their
rights to participate in subsequent Tag-Along Sales subject to this Section
4.01.
(g) The sale of the Selling Person's Shares in any Tag-Along Sale shall be
effected on the same terms and conditions as the sale of any Tagging Person's
Shares and no Selling Person shall receive any form of special consideration or
control premium in addition to the price payable for the sold Shares.
(h) The right of the Xxxxxxxxxxx Shareholders, the Xxxxx Shareholders, the
Xxxxxxxx Shareholders and the LSH Shareholders to participate in a Tag-Along
Sale shall terminate at such time as the aggregate number of Shares held by the
Xxxxxxxxxxx Shareholders, the Xxxxx Shareholders, the Xxxxxxxx Shareholders or
the LSH Shareholders, as the case may be, is less than 50% of
their aggregate Initial Ownership of Common Stock.
Section 4.02. Right to Compel Participation in Certain Transfers. (a) If (i)
the CSH Shareholders propose to transfer Shares representing not less than 50%
of their aggregate Initial Ownership of Common Stock to a Third Party in a bona
fide sale for cash negotiated on an arms-length basis, and (ii) the CSH
Shareholders propose a transfer in which the Shares to be transferred by the CSH
Shareholders, the Xxxxxxxxxxx Shareholders, the Xxxxx Shareholders, the Xxxxxxxx
Shareholders and the LSH Shareholders would constitute more than 50% of the
outstanding shares of Common Stock determined on a fully diluted basis (a
"Section 4.02 Sale"), the CSH Shareholders may at their option require all
Xxxxxxxxxxx Shareholders, Xxxxx Shareholders, Xxxxxxxx Shareholders and the LSH
Shareholders to sell the Subject Securities ("Drag-Along Rights") then held by
every Xxxxxxxxxxx Shareholder, Xxxxx Shareholder, Xxxxxxxx Shareholders and the
LSH Shareholders to such Third Party, for the same consideration per share of
Common Stock and otherwise on the same terms and conditions as the CSH
Shareholders. CSH shall provide written notice of such Section 4.02 Sale to the
Xxxxxxxxxxx Shareholders, the Xxxxx Shareholders, the Xxxxxxxx Shareholders, the
LSH Shareholders and the Company (a "Section 4.02 Notice") not later than the
30th day prior to the proposed Section 4.02 Sale. The Section 4.02 Notice shall
identify the transferee, the number of Subject Securities, the consideration for
which a transfer is proposed to be made (the "Section 4.02 Sale Price") and all
other material terms and conditions of the Section 4.02 Sale. The number of
shares of Common Stock to be sold by each Xxxxxxxxxxx Shareholder, Xxxxx
Shareholder, Xxxxxxxx Shareholder and LSH Shareholder shall not exceed the
Drag-Along Portion of the shares of Common Stock that such Xxxxxxxxxxx
Shareholder, Xxxxx Shareholder, Xxxxxxxx Shareholder and LSH
8
Shareholder owns. Each Xxxxxxxxxxx Shareholder, Xxxxx Shareholder, Xxxxxxxx
Shareholder or LSH Shareholder shall be required to participate in the Section
4.02 Sale on the terms and conditions set forth in the Section 4.02 Notice and
to tender all its Subject Securities as set forth below. The price payable in
such transfer shall be the Section 4.02 Sale Price. Each of the Xxxxxxxxxxx
Shareholders, Xxxxx Shareholders, Xxxxxxxx Shareholders or LSH Shareholder shall
deliver not later than 2 Business Days prior to the date scheduled for the
Section 4.02 Sale to a representative of CSH designated in the Section 4.02
Notice certificates representing all Subject Securities held by such Xxxxxxxxxxx
Shareholder, Xxxxx Shareholder, Xxxxxxxx Shareholder and LSH Shareholder duly
endorsed, together with all other documents required to be executed in
connection with such Section 4.02 Sale or, if such delivery is not permitted by
applicable law, an unconditional agreement to deliver such Subject Securities
pursuant to this Section 4.02 at the closing for such Section 4.02 Sale against
delivery to such Xxxxxxxxxxx Shareholder, Xxxxx Shareholder, Xxxxxxxx
Shareholder and LSH Shareholder of the consideration therefor. If a Xxxxxxxxxxx
Shareholder, Xxxxx Shareholder, Xxxxxxxx Shareholder or LSH Shareholder should
fail to deliver such certificates to CSH, the Company shall cause the books and
records of the Company to show that such Subject Securities are bound by the
provisions of this Section 4.02 and that such Subject Securities shall be
transferred to the purchaser of the Subject Securities immediately upon
surrender for transfer by the holder thereof.
(b) The CSH Shareholders shall have a period of 120 days from the date of
receipt of the Section 4.02 Notice to consummate the Section 4.02 Sale on the
terms and conditions set forth in such Section 4.02 Sale Notice. If the Section
4.02 Sale shall not have been consummated during such period, CSH shall return
to each of the Xxxxxxxxxxx Shareholders, each of the Xxxxx Shareholders, each of
the Xxxxxxxx Shareholders and each of the LSH Shareholders all certificates
representing Shares that such Xxxxxxxxxxx Shareholder, Xxxxx Shareholder,
Xxxxxxxx Shareholder or LSH Shareholder, as the case may be, may have delivered
for transfer pursuant hereto, together with any documents in the possession of
CSH executed by the Xxxxxxxxxxx Shareholder, the Xxxxx Shareholder, the Xxxxxxxx
Shareholder or the LSH Shareholder, as the case may be, in connection with such
proposed transfer, and all the restrictions on transfer contained in this
Agreement or otherwise applicable at such time with respect to Common Stock
owned by the Xxxxxxxxxxx Shareholders, the Xxxxx Shareholders, the Xxxxxxxx
Shareholders and the LSH Shareholders shall again be in effect.
(c) Concurrently with the consummation of the transfer of Shares pursuant to
this Section 4.02, CSH or the Company, as applicable, shall remit to each of the
Shareholders who have surrendered their certificates the total consideration (by
bank or certified check) for the Shares transferred pursuant hereto and shall
furnish such other evidence of the completion and time of completion of such
transfer and the terms thereof as may be reasonably requested by such
Shareholders.
(d) In furtherance of, and not in limitation of the foregoing provisions of
this Section 4.02, in connection with a Section 4.02 Sale (which Section 4.02
Sale may be structured as a merger, recapitalization, reorganization, sale of
assets or otherwise) each Xxxxxxxxxxx Shareholder, Xxxxx Shareholder, Xxxxxxxx
Shareholder or LSH Shareholder will (i) consent to and raise no objection
against the Section 4.02 Sale or the process pursuant to which it was arranged,
(ii) waive any appraisal rights and other similar rights and (iii) execute all
documents containing such terms and conditions as those executed by other
Shareholders as directed by the CSH Shareholders.
(e) The sale of the CSH Shareholders' Shares in any Section 4.02 Sale shall be
effected on the same terms and conditions as the sale of any Shares owned by the
Xxxxxxxxxxx Shareholders, the Xxxxx Shareholders, the Xxxxxxxx Shareholders and
the LSH Shareholders and no CSH Shareholder shall receive any form of special
consideration or control premium in addition to the price payable for the sold
Shares.
9
ARTICLE 5
REGISTRATION RIGHTS
Section 5.01. Demand Registration. (a) If the Company shall receive a written
request by the CSH Shareholders (any such requesting Person, a "Selling
Shareholder") that the Company effect the registration under the Securities Act
of all or a portion of such Selling Shareholder's Registrable Securities, and
specifying the intended method of disposition thereof, then the Company shall
promptly give written notice of such requested registration (a "Demand
Registration") to the Xxxxxxxxxxx Shareholders, the Xxxxx Shareholders, the
Xxxxxxxx Shareholders and the LSH Shareholders, and thereupon will use its best
efforts to effect, as expeditiously as possible, the registration under the
Securities Act of:
(i) the Registrable Securities which the Company has been so requested to
register by the Selling Shareholders, then held by the Selling Shareholders;
and
(ii) all other Registrable Securities of the same type as that to which the
request by the Selling Shareholders relates which any Xxxxxxxxxxx Shareholder,
any Xxxxx Shareholder, any Xxxxxxxx Shareholder or any LSH Shareholder (all
such Shareholders, together with the Selling Shareholders, the "Holders") has
requested the Company to register by written request received by the Company
within 10 days (one of which shall be a Business Day) after the receipt by
such Holders of such written notice given by the Company, all to the extent
necessary to permit the disposition (in accordance with the intended methods
thereof as aforesaid) of the Registrable Securities so to be registered;
provided that, subject to Section 5.01(d) hereof, the Company shall not be
obligated to effect more than five Demand Registrations for the CSH
Shareholders; and provided further that the Company shall not be obligated to
effect a Demand Registration unless the aggregate proceeds expected to be
received from the sale of the Common Stock requested to be included in such
Demand Registration, in the reasonable opinion of CSH exercised in good faith,
equals or exceeds $7,500,000. In no event will the Company be required to
effect more than one Demand Registration within any four-month period.
(b) Promptly after the expiration of the 10-day period referred to in Section
5.01(a)(ii) hereof, the Company will notify all the Holders to be included in
the Demand Registration of the other Holders and the number of Registrable
Securities requested to be included therein. The Selling Shareholders requesting
a registration under Section 5.01(a) may, at any time prior to the effective
date of the registration statement relating to such registration, revoke such
request, without liability to any of the other Holders, by providing a written
notice to the Company revoking such request, in which case such request, so
revoked, shall be considered a Demand Registration unless such revocation arose
out of the fault of the Company or unless the participating Shareholders
reimburse the Company for all costs incurred by the Company in connection with
such registration, in which case such request shall not be considered a Demand
Registration.
(c) The Company will pay all Registration Expenses in connection with any
Demand Registration.
(d) A registration requested pursuant to this Section 5.01 shall not be deemed
to have been effected unless the registration statement relating thereto (i) has
become effective under the Securities Act and (ii) all of the Registrable
Securities registered thereunder have been sold; provided that if, within 180
days after it has become effective, the offering of Registrable Securities
pursuant to such registration is interfered with by any stop order, injunction
or other order or requirement of the SEC or other governmental agency or court
such registration will be deemed not to have been effected.
(e) If a Demand Registration involves an Underwritten Public Offering and the
managing underwriter shall advise the Company and the Selling Shareholders that,
in its view, (i) the number of shares of Registrable Securities requested to be
included in such registration (including any securities which the Company
proposes to be included which are not Registrable Securities) or (ii) the
inclusion of some or all of the shares of Registrable Securities owned by the
Holders, in any such case, exceeds the largest number of shares which can be
sold without having an adverse effect on such offering, including the price at
which such shares can be sold (the
10
"Maximum Offering Size"), the Company will include in such registration, in the
priority listed below, up to the Maximum Offering Size:
(A) first, all Registrable Securities requested to be registered by the
parties requesting such Demand Registration and all Registrable Securities
requested to be included in such registration by any other Holder (allocated,
if necessary for the offering not to exceed the Maximum Offering Size, pro
rata among such Holders on the basis of the relative number of Registrable
Securities so requested to be included in such registration); and
(B) second, any securities proposed to be registered by the Company.
(f) Upon written notice to each Selling Shareholder, the Company may postpone
effecting a registration pursuant to this Section 5.01 on one occasion during
any period of six consecutive months for a reasonable time specified in the
notice but not exceeding 90 days (which period may not be extended or renewed),
if (1) an investment banking firm of recognized national standing shall advise
the Company and the Selling Shareholders in writing that effecting the
registration would materially and adversely affect an offering of securities of
such Company the preparation of which had then been commenced or (2) the Company
is in possession of material non-public information the disclosure of which
during the period specified in such notice the Company believes, in its
reasonable judgment, would not be in the best interests of the Company.
(g) After the Company has effected one Demand Registration by the CSH
Shareholders pursuant to this Section 5.01 of Common Stock, the Xxxxxxxxxxx
Shareholders, upon request of the Xxxxxxxxxxx Shareholders owning a majority of
the Shares acquired by the Xxxxxxxxxxx Shareholders on the Closing Date may
request that the Company register Common Stock which are Registrable Securities
then owned by such Xxxxxxxxxxx Shareholders. In no event will the Company be
required to effect more than two such Demand Registrations by the Xxxxxxxxxxx
Shareholders. The other provisions of this Article 5 applicable to Demand
Registrations requested by the CSH Shareholders shall apply, mutatis mutandis,
to any such Demand Registration by the Xxxxxxxxxxx Shareholders.
(h) If any registration requested pursuant to this Section 5.01 which is
proposed by the Company to be effected by the filing of a registration statement
on form S-3 (or any successor or similar short-form registration statement)
shall be in connection with an Underwritten Public Offering, and if the managing
underwriter shall advise the Company in writing that, in its opinion, the use of
another form of registration statement is of material importance to the success
of such proposed offering, then such registration shall be effected on such
other form.
Section 5.02. Piggyback Registration. Piggyback Registration. (a) If the
Company proposes to register any of its Common Stock under the Securities Act
(other than pursuant to a Demand Registration), it will each such time,
subject to the provisions of Section 5.02(b) hereof, give prompt written
notice at least 15 days prior to the anticipated filing date of the
registration statement relating to such registration to all Shareholders which
notice shall set forth such Shareholders' rights under this Section 5.02 and
shall offer all Shareholders the opportunity to include in such registration
statement such number of shares of Common Stock as each such Shareholder may
request (a "Piggyback Registration"). Upon the written request of any such
Shareholder made within 10 days after the receipt of notice from the Company
(which request shall specify the number of shares of Common Stock intended to
be disposed of by such Shareholder), the Company will use its reasonable best
efforts to effect the registration under the Securities Act of all shares of
Common Stock which the Company has been so requested to register by such
Shareholders, to the extent requisite to permit the disposition of the shares
of Common Stock so to be registered; provided that (i) if such registration
involves an Underwritten Public Offering, all such Shareholders requesting to
be included in the Company's registration must sell their Registrable
Securities to the underwriters selected as provided in Section 5.04(f) on the
same terms and conditions as apply to the Company or the Selling Shareholder,
as applicable, and (ii) if, at any time after giving written notice of its
intention to register any stock pursuant to this Section 5.02(a) 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
stock, the Company shall give written notice to all such Shareholders and,
thereupon, shall be relieved of its obligation to register any Registrable
Securities in connection with such registration. No
11
registration effected under this Section 5.02 shall relieve the Company of its
obligations to effect a Demand Registration to the extent required by Section
5.01 hereof. The Company will pay all Registration Expenses in connection with
each registration of Registrable Securities requested pursuant to this Section
5.02.
(b) If a registration pursuant to this Section 5.02 involves an Underwritten
Public Offering and the managing underwriter advises the Company that, in its
view, the number of shares of Common Stock which the Company and the selling
Shareholders intend to include in such registration exceeds the Maximum Offering
Size, the Company will include in such registration, in the following priority,
up to the Maximum Offering Size:
(i) first, so much of the Common Stock proposed to be registered for the
account of the Company as would not cause the offering to exceed the Maximum
Offering Size; and
(ii) second, all Registrable Securities requested to be included in such
registration by any Shareholder pursuant to Section 5.02 (allocated, if
necessary for the offering not to exceed the Maximum Offering Size, pro rata
among such Shareholders on the basis of the relative number of shares of
Registrable Securities so requested to be included in such registration).
Section 5.03. Holdback Agreements. With respect to each and every firmly
underwritten Public Offering, each Shareholder agrees not to offer or sell any
shares of Common Stock (except for shares of Common Stock, if any, sold in that
Public Offering) during the 14 days prior to the effective date of the
applicable registration statement for a public offering of shares of Common
Stock (except as part of such registration) and during the period after such
effective date equal to the lesser of: (i) 180 days or (ii) any such shorter
period as the Company and the lead managing underwriter of an Underwritten
Public Offering agree.
Section 5.04. Registration Procedures. Whenever Shareholders request that any
Registrable Securities be registered pursuant to Section 5.01 or 5.02 hereof,
the Company will, subject to the provisions of such Sections, use its reasonable
best efforts to effect the registration and the sale of such Registrable
Securities in accordance with the intended method of disposition thereof as
quickly as practicable, and in connection with any such request:
(a) The Company will as expeditiously as possible prepare and file with the
SEC a registration statement on any form selected by counsel for the Company
and which form shall be available for the sale of the Registrable Securities
to be registered thereunder in accordance with the intended method of
distribution thereof, and use its reasonable best efforts to cause such filed
registration statement to become and remain effective for a period of not less
than 180 days (or such shorter period in which all of the Registrable
Securities of the Holders included in such registration statement shall have
actually been sold thereunder).
(b) The Company will, if requested, prior to filing a registration statement
or prospectus or any amendment or supplement thereto, furnish to each
Shareholder and each underwriter, if any, of the Registrable Securities
covered by such registration statement copies of such registration statement
as proposed to be filed, and thereafter the Company will furnish to such
Shareholder and underwriter, if any, such number of copies of such
registration statement, each amendment and supplement thereto (in each case
including all exhibits thereto and documents incorporated by reference
therein), the prospectus included in such registration statement (including
each preliminary prospectus) and such other documents as such Shareholder or
underwriter may reasonably request in order to facilitate the disposition of
the Registrable Securities owned by such Shareholder. Each Shareholder shall
have the right to request that the Company modify any information contained in
such registration statement, amendment and supplement thereto pertaining to
such Shareholder and the Company shall use its reasonable best efforts to
comply with such request, provided, however, that the Company shall not have
any obligation to so modify any information if so doing would cause the
prospectus to contain an untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make the
statements therein not misleading.
(c) After the filing of the registration statement, the Company will (i)
cause the related prospectus to be supplemented by any required prospectus
supplement, and as so supplemented to be filed pursuant to
12
Rule 424 under the Securities Act, (ii) comply with the provisions of the
Securities Act with respect to the disposition of all Registrable Securities
covered by such registration statement during the applicable period in
accordance with the intended methods of disposition by the sellers thereof set
forth in such registration statement or supplement to such prospectus and
(iii) promptly notify each Shareholder holding Registrable Securities covered
by such registration statement of any stop order issued or threatened by the
SEC or any state securities commission under state blue sky laws and take all
reasonable actions required to prevent the entry of such stop order or to
remove it if entered.
(d) The Company will use its reasonable best efforts to (i) register or
qualify the Registrable Securities covered by such registration statement
under such other securities or blue sky laws of such jurisdictions in the
United States as any Shareholder holding such Registrable Securities
reasonably (in light of such Shareholder's intended plan of distribution)
requests and (ii) cause such Registrable Securities to be registered with or
approved by such other governmental agencies or authorities as may be
necessary by virtue of the business and operations of the Company and do any
and all other acts and things that may be reasonably necessary or advisable to
enable such Shareholder to consummate the disposition of the Registrable
Securities owned by such Shareholder; provided that the Company will not be
required to (A) qualify generally to do business in any jurisdiction where it
would not otherwise be required to qualify but for this paragraph (d), (B)
subject itself to taxation in any such jurisdiction or (C) consent to general
service of process in any such jurisdiction.
(e) The Company will immediately notify each Shareholder holding such
Registrable Securities covered by such registration statement, at any time
when a prospectus relating thereto is required to be delivered under the
Securities Act, of the occurrence of an event requiring the preparation of a
supplement or amendment to such prospectus so that, as thereafter delivered to
the purchasers of such Registrable Securities, such prospectus will not
contain an untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the statements therein
not misleading and promptly prepare and make available to each such
Shareholder and file with the SEC any such supplement or amendment.
(f) In connection with any Demand Registration requested by the CSH
Shareholders, the Company shall appoint the underwriter or underwriters chosen
by CSH. The Company will enter into customary agreements (including an
underwriting agreement in customary form) and take such other actions as are
reasonably required in order to expedite or facilitate the disposition of such
Registrable Securities, including the engagement of a "qualified independent
underwriter" in connection with the qualification of the underwriting
arrangements with the NASD.
(g) Upon execution of confidentiality agreements in form and substance
reasonably satisfactory to the Company, the Company will make available for
inspection by any Shareholder and any underwriter participating in any
disposition pursuant to a registration statement being filed by the Company
pursuant to this Section 5.04 and any attorney, accountant or other
professional retained by any such Shareholder or underwriter (collectively,
the "Inspectors"), all financial and other records, pertinent corporate
documents and properties of the Company (collectively, the "Records") as shall
be reasonably requested by any such Person, and cause the Company's officers,
directors and employees to supply all information reasonably requested by any
Inspectors in connection with such registration statement.
(h) The Company will furnish to each such Shareholder (if requested by such
Shareholder) and to each such underwriter, if any, a signed counterpart,
addressed to such underwriter and the participating Shareholders, of (i) an
opinion or opinions of counsel to the Company and (ii) a comfort letter or
comfort letters from the Company's independent public accountants, each in
customary form and covering such matters of the type customarily covered by
opinions or comfort letters, as the case may be, as a majority of such
Shareholders or the managing underwriter therefor reasonably requests.
(i) The Company will otherwise use its reasonable best efforts to comply
with all applicable rules and regulations of the SEC and the relevant state
blue sky commissions, and make available to its securityholders, as soon as
reasonably practicable, an earnings statement covering a period of 12 months,
13
beginning within three months after the effective date of the registration
statement, which earnings statement shall satisfy the provisions of Section
11(a) of the Securities Act.
(j) The Company may require each such Shareholder to promptly furnish in
writing to the Company information regarding the distribution of the
Registrable Securities as the Company may from time to time reasonably request
and such other information as may be legally required in connection with such
registration.
(k) Each such Shareholder agrees that, upon receipt of any notice from the
Company of the happening of any event of the kind described in Section 5.04(e)
hereof, such Shareholder will forthwith discontinue disposition of Registrable
Securities pursuant to the registration statement covering such Registrable
Securities until such Shareholder's receipt of the copies of the supplemented
or amended prospectus contemplated by Section 5.04(e) hereof, and, if so
directed by the Company, such Shareholder will deliver to the Company all
copies, other than any permanent file copies then in such Shareholder's
possession, of the most recent prospectus covering such Registrable Securities
at the time of receipt of such notice. In the event that the Company shall
give such notice, the Company shall extend the period during which such
registration statement shall be maintained effective (including the period
referred to in Section 5.04(a) hereof) by the number of days during the period
from and including the date of the giving of notice pursuant to Section
5.04(e) hereof to the date when the Company shall make available to such
Shareholder a prospectus supplemented or amended to conform with the
requirements of Section 5.04(e) hereof.
(l) The Company will use its reasonable best efforts to list such
Registrable Securities on any securities exchange on which the Common Stock is
then listed or on NASDAQ if the Common Stock is then quoted on NASDAQ not
later than the effective date of such registration statement.
Section 5.05. Indemnification by the Company. The Company agrees to indemnify
and hold harmless each Shareholder holding Registrable Securities covered by a
registration statement, its officers, directors, employees, members, partners
and agents, any affiliate of such Shareholder and each Person, if any, who
controls such Shareholder within the meaning of the Securities Act or Section 20
of the Exchange Act (and officers, directors, employees, members, partners and
agents of any such affiliate or controlling Persons) from and against any and
all losses, claims, damages and liabilities, joint or several, and expenses
(including reasonable attorneys fees and costs and expenses of investigation)
caused by any untrue statement or alleged untrue statement of a material fact
contained in any registration statement or prospectus relating to the
Registrable Securities (as amended or supplemented if the Company shall have
furnished any amendments or supplements thereto) or any preliminary prospectus,
or caused by any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, except insofar as such losses, claims, damages or liabilities are
caused by any such untrue statement or omission or alleged untrue statement or
omission so made in strict conformity with information furnished in writing to
the Company by such Shareholder or on such Shareholder's behalf expressly for
use therein; provided that with respect to any untrue statement or omission or
alleged untrue statement or omission made in any preliminary prospectus, or in
any prospectus, as the case may be, the indemnity agreement contained in this
paragraph shall not apply to the extent that any such loss, claim, damage,
liability or expense results from the fact that a current copy of the prospectus
(or, in the case of a prospectus, the prospectus as amended or supplemented) was
not sent or given to the Person asserting any such loss, claim, damage,
liability or expense at or prior to the written confirmation of the sale of the
Registrable Securities concerned to such Person if it is determined that the
Company has provided such current copy of such prospectus (or such amended or
supplemented prospectus, as the case may be) to such Shareholder in a timely
manner prior to such sale and it was the responsibility of such Shareholder
under the Securities Act to provide such Person with a current copy of the
prospectus (or such amended or supplemented prospectus, as the case may be) and
such current copy of the prospectus (or such amended or supplemented prospectus,
as the case may be) would have cured the defect giving rise to such loss, claim,
damage, liability or expense. The Company also agrees to indemnify any
underwriters of the Registrable Securities, their officers and directors and
each person who controls such underwriters on substantially the same basis as
that of the indemnification of the Shareholders provided in this Section 5.05.
14
Section 5.06. Indemnification by Participating Shareholders. Each Shareholder
holding Registrable Securities included in any registration statement agrees,
severally but not jointly, to indemnify and hold harmless the Company, its
officers, directors and agents and each Person (other than such Shareholder) if
any, who controls the Company within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act to the same extent as the
foregoing indemnity from the Company to such Shareholder, but only (i) with
respect to information furnished in writing by such Shareholder or on such
Shareholder's behalf expressly for use in any registration statement or
prospectus relating to the Registrable Securities, or any amendment or
supplement thereto, or any preliminary prospectus or (ii) to the extent that any
loss, claim, damage, liability or expense described in Section 5.05 results from
the fact that a current copy of the prospectus (or, in the case of a prospectus,
the prospectus as amended or supplemented) was not sent or given to the Person
asserting any such loss, claim, damage, liability or expense at or prior to the
written confirmation of the sale of the Registrable Securities concerned to such
Person if it is determined that it was the responsibility of such Shareholder to
provide such Person with a current copy of the prospectus (or such amended or
supplemented prospectus, as the case may be) and such current copy of the
prospectus (or such amended or supplemented prospectus, as the case may be)
would have cured the defect giving rise to such loss, claim, damage, liability
or expense. Each such Shareholder shall be prepared, if required by the
underwriting agreement, to indemnify and hold harmless underwriters of the
Registrable Securities, their officers and directors and each person who
controls such underwriters on substantially the same basis as that of the
indemnification of the Company provided in this Section 5.06. As a condition to
including Registrable Securities in any registration statement filed in
accordance with Article 5 hereof, the Company may require that it shall have
received an undertaking reasonably satisfactory to it from any underwriter to
indemnify and hold it harmless to the extent customarily provided by
underwriters with respect to similar securities.
No Shareholder shall be liable under Section 5.06 for any damage thereunder in
excess of the net proceeds realized by such Shareholder in the sale of the
Registrable Securities of such Shareholder.
Section 5.07. Conduct of Indemnification Proceedings. In case any proceeding
(including any governmental investigation) shall be instituted involving any
Person in respect of which indemnity may be sought pursuant to this Article 5,
such Person (an "Indemnified Party") shall promptly notify the Person against
whom such indemnity may be sought (the "Indemnifying Party") in writing and the
Indemnifying Party shall assume the defense thereof, including the employment of
counsel reasonably satisfactory to such Indemnified Party, and shall assume the
payment of all fees and expenses; provided that the failure of any Indemnified
Party so to notify the Indemnifying Party shall not relieve the Indemnifying
Party of its obligations hereunder except to the extent that the Indemnifying
Party is materially and actually prejudiced by such failure to notify. In any
such proceeding, any Indemnified Party shall have the right to retain its own
counsel, but the fees and expenses of such counsel shall be at the expense of
such Indemnified Party unless (i) the Indemnifying Party and the Indemnified
Party shall have mutually agreed to the retention of such counsel or (ii) in the
reasonable judgment of such Indemnified Party representation of both parties by
the same counsel would be inappropriate due to actual or potential differing
interests between them. It is understood that the Indemnifying Party shall not,
in connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the reasonable fees and expenses of more than one
separate firm of attorneys (in addition to any local counsel) at any time for
all such Indemnified Parties, and that all such fees and expenses shall be
reimbursed as they are incurred. In the case of any such separate firm for the
Indemnified Parties, such firm shall be designated in writing by the Indemnified
Parties. The Indemnifying Party shall not be liable for any settlement of any
proceeding effected without its written consent, but if settled with such
consent, or if there be a final judgment for the plaintiff, the Indemnifying
Party shall indemnify and hold harmless such Indemnified Parties from and
against any and all losses, claims, damages, liabilities and expenses or
liability (to the extent stated above) by reason of such settlement or judgment.
No Indemnifying Party shall, without the prior written consent of the
Indemnified Party, effect any settlement of any pending or threatened proceeding
in respect of which any Indemnified Party is or could have been a party and
indemnity could have been sought hereunder by such Indemnified Party, unless
such settlement includes an unconditional release of such Indemnified Party from
all liability arising out of such proceeding.
15
Section 5.08. Contribution. If the indemnification provided for in this
Article 5 is held by a court of competent jurisdiction to be unavailable to the
Indemnified Parties in respect of any losses, claims, damages, liabilities or
expenses referred to herein, then each such Indemnifying Party, in lieu of
indemnifying such Indemnified Party, shall contribute to the amount paid or
payable by such Indemnified Party as a result of such losses, claims, damages or
liabilities (i) as between the Company and the Shareholders holding Registrable
Securities covered by a registration statement and their related Indemnified
Parties on the one hand and the underwriters and their related Indemnified
Parties on the other, in such proportion as is appropriate to reflect the
relative benefits received by the Company and such Shareholders on the one hand
and the underwriters on the other, from the offering of the Shareholders'
Registrable Securities, or if such allocation is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits but also the relative fault of the Company and such Shareholders on the
one hand and of such underwriters on the other in connection with the statements
or omissions which resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations and (ii) as between the
Company and their related Indemnified Parties on the one hand and each such
Shareholder and their related Indemnified Parties on the other, in such
proportion as is appropriate to reflect the relative fault of the Company and of
each such Shareholder in connection with such statements or omissions, as well
as any other relevant equitable considerations. The relative benefits received
by the Company and such Shareholders on the one hand and such underwriters on
the other shall be deemed to be in the same proportion as the total proceeds
from the offering (net of underwriting discounts and commissions but before
deducting expenses) received by the Company and such Shareholders bear to the
total underwriting discounts and commissions received by such underwriters, in
each case as set forth in the table on the cover page of the prospectus. The
relative fault of the Company and such Shareholders on the one hand and of such
underwriters on the other shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Company and such Shareholders or by such underwriters. The
relative fault of the Company on the one hand and of each such Shareholder on
the other shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by such party,
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
The Company and the Shareholders agree that it would not be just and equitable
if contribution pursuant to this Section 5.08 were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
The amount paid or payable by an Indemnified Party as a result of the losses,
claims, damages, liabilities or expenses referred to in the immediately
preceding paragraph shall be deemed to include, subject to the limitations set
forth above, any legal or other expenses reasonably incurred by such Indemnified
Party in connection with investigating or defending any such action or claim.
Notwithstanding the provisions of this Section 5.08 no underwriter shall be
required to contribute any amount in excess of the underwriting discount
applicable to securities purchased by such underwriter in such offering, less
the aggregate amount of any damages which such underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission, and no Shareholder shall be required to contribute any
amount in excess of the amount by which the net proceeds realized on the sale of
the Registrable Securities of such Shareholder exceeds the amount of any damages
which such Shareholder has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. 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. Each Shareholder's obligation
to contribute pursuant to this Section 5.08 is several in the proportion that
the proceeds of the offering received by such Shareholder bears to the total
proceeds of the offering received by all such Shareholders and not joint.
Section 5.09. Participation in Public Offering. No Person may participate in
any Underwritten Public Offering hereunder unless such Person (a) agrees to sell
such Person's securities on the basis provided in any underwriting arrangements
to be entered into in connection with such Underwritten Public Offering and (b)
completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other
16
documents reasonably required under the terms of such underwriting arrangements
and the provisions of this Agreement in respect of registration rights.
Section 5.10. Rule 144. The Company covenants that it 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 SEC 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), and it 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 (i) Rule 144 under the
Securities Act, as such Rule may be amended from time to time, or (ii) any
similar rule or regulation hereafter adopted by the SEC. Upon the request of any
holder of Registrable Securities, the Company will deliver to such holder a
written statement as to whether it has complied with such requirements.
Notwithstanding anything contained in this Section 5.10, the Company may
de-register under Section 12 of the Exchange Act if it then is permitted to do
so pursuant to the Exchange Act and the rules and regulations thereunder and, in
such circumstances, shall not be required hereby to file any reports which may
be necessary in order for Rule 144 or any similar rule or regulation to be
available.
Section 5.11. No Transfer of Registration Rights. None of the rights of
Shareholders under this Article 5 shall be assignable by any Shareholder to any
Person acquiring securities of such Shareholder in any Public Offering or
pursuant to a distribution to the public under Rule 144 under the Securities
Act.
ARTICLE 6
RETAIN COVENANTS AND AGREEMENTS
Section 6.01. Limitations on Subsequent Registration. Without the prior
written consent of Shareholders holding at least 51% of the Shares held by all
Shareholders, the Company shall not enter into any agreement with any holder or
prospective holder of any securities of the Company (a) that would allow such
holder or prospective holder to include such securities in any registration
filed pursuant to Section 5.01 or 5.02 hereof, unless under the terms of such
agreement, such holder or prospective holder may include such securities in any
such registration only to the extent that the inclusion of such securities would
not reduce the amount of the Registrable Securities of the Shareholders included
therein or (b) on terms otherwise more favorable than this Agreement.
Section 6.02. Limitation on Purchase of Common Stock. Until the earlier to
occur of (i) the fifth anniversary of the Closing Date or (ii) the occurrence of
a Change in Control no Xxxxxxxxxxx Shareholder shall acquire any shares of
Common Stock or securities convertible into or exercisable or exchangeable for
Common Stock except (x) as a Permitted Transferee in a transfer from any other
Xxxxxxxxxxx Shareholder which is otherwise permitted under the terms of Article
3 hereof or (y) pursuant to stock options granted by the Company.
ARTICLE 7
MISCELLANEOUS
Section 7.01. Entire Agreement. This Agreement, including all exhibits hereto,
constitutes the entire agreement and supersedes all prior agreements and
undertakings, both written and oral, among the parties, or any of them, with
respect to the subject matter hereof and except as otherwise expressly provided
herein.
Section 7.02. Binding Effect; Benefit. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective heirs,
successors, legal representatives and permitted assigns. Except as expressly
provided in Sections 5.05 and 5.06, nothing in this Agreement, expressed or
implied, is intended to confer on any Person other than the parties hereto, and
their respective heirs, successors, legal representatives and permitted assigns,
any rights, remedies, obligations or liabilities under or by reason of this
Agreement.
17
Section 7.03. Assignability. (a) Neither this Agreement nor any right, remedy,
obligation or liability arising hereunder or by reason hereof shall be
assignable by the Company or any Shareholder; provided that (i) any Permitted
Transferee acquiring shares of Common Stock in a transfer permitted under this
Agreement shall execute and deliver to the Company a Joinder Agreement, and (ii)
with the prior written consent of Shareholders holding at least 50% of the
Shares held by all Shareholders, the rights and obligations of the Shareholders
under Article 5 shall be assignable by the Shareholders to any Third Party
acquiring Registrable Securities in a transfer permitted under this Agreement.
Section 7.04. Amendment; Waiver; Termination. (a) No provision of this
Agreement may be waived except by an instrument in writing executed by the party
against whom the waiver is to be effective. No provision of this Agreement may
be amended or otherwise modified except by an instrument in writing executed by
the Company and holders of at least 50% of the Shares held by the Shareholders
at the time of such proposed amendment or modification.
(b) In addition, any amendment or modification of any provision of this
Agreement that would adversely affect any (i) CSH Shareholder may be effected
only with the consent of CSH Shareholders holding at least 50% of the Shares
held by the CSH Shareholders, (ii) Xxxxxxxxxxx Shareholder may be effected only
with the consent of Xxxxxxxxxxx Shareholders holding at least 50% of the Shares
held by the Xxxxxxxxxxx Shareholders, (iii) Xxxxx Shareholder may be effected
only with the consent of Xxxxx Shareholders holding at least 50% of the Shares
held by the Xxxxx Shareholders, (iv) Xxxxxxxx Shareholder may be effected only
with the consent of Xxxxxxxx Shareholders holding at least 50% of the Shares
held by the Servidio Shareholders or (v) LSH Shareholder may be effected only
with the consent of LSH Shareholders holding at least 50% of the Shares held by
the LSH Shareholders.
(c) This Agreement shall terminate on the tenth anniversary of the date hereof
unless earlier terminated.
Section 7.05. Notices. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly received if so given) by hand delivery, telegram, telex
or telecopy, or by mail (registered or certified mail, postage prepaid, return
receipt requested) or by any courier service providing proof of delivery. All
communications hereunder shall be delivered to the respective parties at the
following addresses:
(i) if to the Company, to:
IPC Information Systems, Inc.
Wall Street Plaza
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: General Counsel
Fax: (000) 000-0000
with copies to:
Citicorp Venture Capital, Ltd.
000 Xxxx Xxxxxx--00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx, Xx.
Fax: (000) 000-0000
and
Xxxxxx, Xxxxx & Xxxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx, Esq.
Fax: (000) 000-0000
18
and
Thacher, Xxxxxxxx & Xxxx
Xxx Xxxxx Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx, Esq.
Fax: (000) 000-0000
(ii) if to any CSH Shareholder, to:
Cable Systems Holding, LLC
000 Xxxxx 00xx Xxxxxx
Xxxxxxx, Xxxxxxx 00000-0000
Attention: Xxxxx Xxxx
Fax: (000) 000-0000
with copies to:
Citicorp Venture Capital, Ltd.
000 Xxxx Xxxxxx--00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx, Xx.
Fax: (000) 000-0000
and
Xxxxxx, Xxxxx & Xxxxxxx LLP
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx, Esq.
Fax: (000) 000-0000
and
Dechert Price & Xxxxxx
4000 Xxxx Atlantic Tower
0000 Xxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Attn: Xxxxxx Xxxxxx, Esq.
Fax: (000) 000-0000
(iii) If to any Xxxxxxxxxxx Shareholder, to:
Xxxxxxx X. Xxxxxxxxxxx
00 Xxxxxxx Xxxx
Xxxxxxxxxx, XX 00000
with a copy to:
White & Case
1155 Avenue of the Americas
New York, New York
Attention: Xxxxxx X. Rover, Esq.
Fax: (000) 000-0000
(iv) If to any Xxxxx Shareholder, to:
IPC Information Systems, Inc.
Wall Xxxxxx Xxxxx
00
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxxx
Fax: (000) 000-0000
(v) If to any Servidio Shareholder, to:
IPC Information Systems, Inc.
Wall Street Plaza
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxx
Fax: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxx & Xxxxxxx
00 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxx Xxxxxxxxx, Esq.
Fax: (000) 000-0000
(vi) If to any LSH Shareholder, to:
Xxxxxxxx, Xxxxx & Xxxxx III, L.P.
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Attention: Xxxxxxx X. Xxxxx
Fax: (000) 000-0000
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above.
Section 7.06. Headings. The headings contained in this Agreement are for the
convenience of reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.
Section 7.07. Counterparts. This Agreement may be executed in one or more
counterparts, and by the different parties hereto in separate counterparts, each
of which when executed shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement.
Section 7.08. Governing Law. This Agreement shall be governed and construed in
accordance with the laws of the State of New York, without giving effect to any
choice of law or conflict of law provision or rule that would cause the
application of the laws of any jurisdiction other than the State of New York,
except to the extent that the General Corporation Law of the State of Delaware
applies as a result of the Company being incorporated in the State of Delaware,
in which case such General Corporation Law shall apply.
Section 7.09. Specific Enforcement. The parties hereto agree that irreparable
damage would occur in the event that any of the provisions of this Agreement
were not performed in accordance with their specific terms. It is accordingly
agreed that the parties hereto shall be entitled to specific performance of the
terms hereof, this being in addition to any other remedy to which they are
entitled at law or in equity.
Section 7.10. Certain Actions. Unless otherwise expressly provided herein,
whenever any action is required under this Agreement by:
(a) the CSH Shareholders (as a group, as opposed to the exercise by a CSH
Shareholder of its individual rights hereunder), it shall be by the
affirmative vote of the holders of at least 51% of the Shares then held by the
CSH Shareholders as a group; or
20
(b) the Xxxxxxxxxxx Shareholders (as a group, as opposed to the exercise by
a Xxxxxxxxxxx Shareholder of its individual rights hereunder), it shall be by
the affirmative vote of the holders of at least 51% of the Shares then held by
the Xxxxxxxxxxx Shareholders as a group.
(c) the Xxxxx Shareholders (as a group, as opposed to the exercise by a
Xxxxx Shareholder of its individual rights hereunder), it shall be by the
affirmative vote of the holders of at least 51% of the Shares then held by the
Xxxxx Shareholders as a group.
(d) the Xxxxxxxx Shareholders (as a group, as opposed to the exercise by a
Xxxxxxxx Shareholder of its individual rights hereunder), it shall be by the
affirmative vote of the holders of at least 51% of the Shares then held by the
Xxxxxxxx Shareholders as a group.
(e) the LSH Shareholders (as a group, as opposed to the exercise by a LSH
Shareholder of its individual rights hereunder), it shall be by the
affirmative vote of the holders of at least 51% of the Shares then held by the
LSH Shareholders as a group.
Section 7.11. Consent to Jurisdiction; Expenses. (a) Any suit, action or
proceeding seeking to enforce any provision of, or based on any matter arising
out of or in connection with, this Agreement or the transactions contemplated
hereby shall be brought in any Federal Court sitting in New York, New York, or
any New York State court sitting in New York, New York, and each of the parties
hereby consents to the exclusive jurisdiction of such courts (and of the
appropriate appellate courts therefrom) in any such suit, action or proceeding
and irrevocably waives, to the fullest extent permitted by law, any objection
which it may now or hereafter have to the laying of the venue of any such suit,
action or proceeding in any such court or that any such suit, action or
proceeding which is brought in any such court has been brought in an
inconvenient forum. Process in any such suit, action or proceeding may be served
on any party anywhere in the world, whether within or without the jurisdiction
of any such court. Without limiting the foregoing, each party agrees that
service of process on such party by any method provided in Section 7.05 shall be
deemed effective service of process on such party and consents to the personal
jurisdiction of any Federal Court sitting in New York, New York, or any New York
State court sitting in New York, New York.
(b) In any dispute arising under this Agreement among any of the parties
hereto, the costs and expenses (including, without limitation, the reasonable
fees and expenses of counsel) incurred by the prevailing party shall be paid by
the party that does not prevail.
Section 7.12. Severability. If any term or other provision of this Agreement
is invalid, illegal or incapable of being enforced by any rule of law or public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the transactions contemplated by the Merger Agreement is not affected in any
manner adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties as closely as possible in an acceptable manner.
Section 7.13. Schedule I. The parties hereto shall cooperate in causing
Schedule I hereto to set forth the securities of the Company held by them.
Section 7.14. Effectiveness. It is a condition precedent to the
effectiveness of this Agreement that the "Merger" under and as defined in the
Merger Agreement shall have been consummated.
[Signature Page to Follow]
21
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed by their respective authorized officers as of the day and year first
above written.
IPC Information Systems Inc.
/s/ S.T. Xxxxxx
By: -----------------------------------
Name: S. Xxxxx Xxxxxx
Title:President & C.E.O.
Cable Systems Holding, LLC
/s/ Xxxxx X. Xxxx
By: -----------------------------------
Name: Xxxxx X. Xxxx
Title:Manager
Cable Systems International, Inc.
/s/ Xxxxx X. Xxxx
By: -----------------------------------
Name: Xxxxx X. Xxxx
Title:President & C.E.O.
/s/ Xxxxxxx Xxxxxxxxxxx
By: -----------------------------------
Xxxxxxx Xxxxxxxxxxx
/s/ Xxxxx Xxxxx
By: -----------------------------------
Xxxxx Xxxxx
/s/ Xxxxxxx Xxxxxxxx
By: -----------------------------------
Xxxxxxx Xxxxxxxx
Xxxxxxxx, Xxxxx & Xxxxx III, L.P.
Its General Partner:
LSH Partners III, L.P.
/s/ Xxxxxxx X. Xxxxx
By: -----------------------------------
Name: Xxxxxxx X. Xxxxx
Title:General Partner
22
SCHEDULE I
SECURITIES OWNERSHIP
EXHIBIT A
FORM OF JOINDER AGREEMENT
IPC Information Systems, Inc.
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Chief Executive Officer
Gentlemen:
In consideration of the transfer to the undersigned of Shares of Common Stock,
par value $.01 per share, [Describe any other security being transferred] of IPC
Information Systems, Inc., a Delaware corporation (the "Company"), the
undersigned represents that it is a Permitted Transferee of [Insert name of
transferor] and agrees that, as of the date written below, [he] [she] [it] shall
become a party to, and a Permitted Transferee as defined in, that certain
Investors Agreement dated as of December 18, 1998, as such agreement may have
been or may be amended from time to time (the "Agreement"), among the Company
and the persons named therein, and as a Permitted transferee shall be fully
bound by, and subject to, all of the covenants, terms and conditions of the
Agreement that were applicable to the undersigned's transferor as though an
original party thereto and shall be deemed a [Xxxxxxxxxxx Shareholder] [CSH
Shareholder] [Xxxxx Shareholder] [Xxxxxxxx Shareholder] [LSH Shareholder] for
purposes thereof.
Executed as of the day of ,
TRANSFEREE:
Address:
A-1
