Exhibit 10.2

 

SECOND AMENDED AND RESTATED STOCKHOLDERS AGREEMENT

 

OF

 

MARQUEE HOLDINGS INC.

 

 

January 26, 2006

 

Originally dated as of October 29, 2004
and Amended and Restated as of December 23, 2004

 

--------------------------------------------------------------------------------

 

TABLE OF CONTENTS

 

 

 

 

Page

 

 

 

 

SECTION 1.

 

TRANSFERS

3

 

 

 

 

(a)

 

Transfer Restrictions

3

(b)

 

Transfer Notice

4

(c)

 

Restrictions on Transfers under Rule 144

4

 

 

 

 

SECTION 2.

 

RIGHT OF FIRST OFFER

4

 

 

 

 

(a)

 

Company Right of First Offer

4

(b)

 

Investor Right of First Offer

5

(c)

 

Investor Over-Allotment Period

5

(d)

 

Restrictions

6

(e)

 

Exercise

6

(f)

 

Acceptance of Offer

7

(g)

 

Consideration

7

(h)

 

Closing

7

(i)

 

Certain Provisions Applicable to the ROFO

7

(j)

 

Time Limitation

7

(k)

 

Investor Expenses

8

 

 

 

 

SECTION 3.

 

DRAG-ALONG RIGHTS

8

 

 

 

 

(a)

 

Drag-Along Right

8

(b)

 

Notice

8

(c)

 

Exercise

9

(d)

 

Time Limitation

9

(e)

 

Investor Expenses

9

 

 

 

 

SECTION 4.

 

TAG-ALONG RIGHTS

10

 

 

 

 

(a)

 

Notice

10

(b)

 

Tag-Along Right

10

(c)

 

Exercise

11

(d)

 

Certain Restrictions

12

(e)

 

Time Limitation

12

(f)

 

Investor Expenses

12

 

 

 

 

SECTION 5.

 

PARTICIPATION RIGHTS

13

 

 

 

 

(a)

 

Participation Rights

13

(b)

 

Offer

13

(c)

 

Exercise

13

(d)

 

Irrevocable Acceptance

14

 

--------------------------------------------------------------------------------

 

(e)

 

Time Limitation

14

(f)

 

Other Securities

14

(g)

 

Certain Legal Requirements

14

(h)

 

Further Assurances

14

(i)

 

Expenses

15

(j)

 

Closing

15

(k)

 

Excluded Transactions

15

 

 

 

 

SECTION 6.

 

REGISTRATION RIGHTS

16

 

 

 

 

(a)

 

Demand Registrations

16

(b)

 

Piggyback Registrations

18

(c)

 

Holdback Agreements

19

(d)

 

Expenses

20

(e)

 

Registration Procedures

20

(f)

 

Conditions to Investor Rights; Indemnification by Investor

24

(g)

 

Indemnification and Contribution

24

(h)

 

Rule 144

27

(i)

 

Termination of Registration Rights

27

(j)

 

Delay of Registration

27

 

 

 

 

SECTION 7.

 

LEGEND ON CERTIFICATES

28

 

 

 

 

(a)

 

Legends

28

 

 

 

 

SECTION 8.

 

DURATION OF AGREEMENT

28

 

 

 

 

SECTION 9.

 

INFORMATION RIGHTS

29

 

 

 

 

(a)

 

Financial Statements and Other Information

29

(b)

 

Other Information

30

 

 

 

 

SECTION 10.

 

REGULATORY MATTERS

30

 

 

 

 

(a)

 

Cooperation of Other Stockholders

30

(b)

 

Covenant Not to Amend

30

(c)

 

Exception

30

 

 

 

 

SECTION 11.

 

EFFECTIVENESS OF AGREEMENT

31

 

 

 

 

SECTION 12.

 

DEFINITIONS

31

 

 

 

 

SECTION 13.

 

MISCELLANEOUS

40

 

 

 

 

(a)

 

Successors, Assigns and Transferees

40

(b)

 

Competitive Opportunity

40

(c)

 

Specific Performance

40

 

iii

--------------------------------------------------------------------------------

 

(d)

 

Governing Law

41

(e)

 

Submission to Jurisdiction; Waiver of Jury Trial

41

(f)

 

Descriptive Headings

41

(g)

 

Notices

41

(h)

 

Recapitalization, Exchange, Etc. Affecting the Company’s Shares

44

(i)

 

Counterparts

44

(j)

 

Severability

44

(k)

 

Amendment

44

(l)

 

Tax Withholding

45

(m)

 

Integration

45

(n)

 

Further Assurances

45

(o)

 

No Strict Construction

45

(p)

 

No Third Party Beneficiaries

45

(q)

 

No Recourse

46

(r)

 

Amendment and Restatement

46

 

 

SCHEDULES

 

1

—

SCHEDULE OF OTHER MARQUEE INVESTORS

 

 

 

2

—

SCHEDULE OF INVESTORS

 

 

 

10(b)

—

REGULATORY PROBLEM AGREEMENTS

 

EXHIBITS

 

A

—

FORM OF STOCKHOLDER JOINDER

 

 

 

B

—

AMENDED AND RESTATED REGULATORY SIDELETTER

 

 

 

C

—

AMENDED AND RESTATED MANAGEMENT STOCKHOLDERS AGREEMENT

 

iv

--------------------------------------------------------------------------------

 

MARQUEE HOLDINGS INC.
SECOND AMENDED AND RESTATED STOCKHOLDERS AGREEMENT

 

This SECOND AMENDED AND RESTATED STOCKHOLDERS AGREEMENT (the “Agreement”), dated
as of January 26, 2006 and effective as of the Effective Time, amends and
restates that certain Stockholders Agreement (the “Initial Stockholders
Agreement”) entered into as of October 29, 2004 and amended and restated as of
December 23, 2004, by and among Marquee Holdings Inc., a Delaware corporation
(including its successors, the “Company”), J.P. Morgan Partners (BHCA), L.P., a
Delaware limited partnership (“JPMP BHCA”), J.P. Morgan Partners Global
Investors, L.P., a Delaware limited partnership (“JPMP Global”), J.P. Morgan
Partners Global Investors (Cayman), L.P., a Cayman limited partnership (“JPMP
Cayman”), J.P. Morgan Partners Global Investors (Cayman) II, L.P., a Cayman
limited partnership (“JPMP Cayman II”), J.P. Morgan Partners Global Investors
(Selldown), L.P., a Delaware limited partnership (“JPMP Selldown”), AMCE
(Ginger), L.P., a Delaware limited partnership (“Ginger”), AMCE (Luke), L.P., a
Delaware limited partnership (“Luke”) and AMCE (Scarlett), L.P., a Delaware
limited partnership (“Scarlett”, and together with JPMP BHCA, JPMP Global, JPMP
Cayman, JPMP Cayman II, JPMP Selldown, Ginger, Luke, and any of their respective
Permitted Transferees, the “JPMP Investors”), Apollo Investment Fund V, L.P., a
Delaware limited partnership (“Apollo Fund V”), Apollo Overseas Partners V,
L.P., a Cayman Island exempted limited partnership (“Apollo Overseas”), Apollo
Netherlands Partners V(A), L.P., a Cayman Island exempted limited partnership
(“Apollo Netherlands V(A)”), Apollo Netherlands Partners V(B), L.P., a Cayman
Island exempted limited partnership (“Apollo Netherlands V(B)”), Apollo German
Partners V GmbH & Co KG, a German limited partnership (“Apollo German Partners”
and, together with Apollo Fund V, Apollo Overseas, Apollo Netherlands V(A) and
Apollo Netherlands V(B), and any of their respective Permitted Transferees, the
“Apollo Investors”), and the other entities listed on Schedule 1 attached hereto
(together with any of their respective Permitted Transferees, the “Other Marquee
Investors”, and together with the JPMP Investors and Apollo Investors, the
“Pre-Existing Marquee Investors”), and is made by and among the Pre-Existing
Marquee Investors and TC Group III, L.P., Carlyle Partners III Loews, L.P. and
CP III Coinvestment, L.P. (together with any of their respective Permitted
Transferees, the “Carlyle Investors”), and Bain Capital Holdings (Loews) I, L.P.
and Bain Capital AIV (Loews) II, L.P. (together with any of their respective
Permitted Transferees, the “Bain Investors”), and Spectrum Equity Investors IV,
L.P., Spectrum Equity Investors Parallel IV, L.P. and Spectrum IV Investment
Managers’ Fund, L.P. (together with any of their respective Permitted
Transferees, the “Spectrum Investors”, and together with the Carlyle Investors
and the Bain Investors, the “Former LCE Investors”).  Each of the Pre-Existing
Marquee Investors and the Former LCE Investors are sometimes referred to herein
as an “Investor” and collectively as the “Investors” (and the terms “Investor”
and “Investors” may include other Persons, as provided in the definition of such
terms in Section 12 hereof) and the Company and the Investors, together with any
subsequent stockholders which become parties hereto, are sometimes referred to
herein individually by name or as a “Party” and collectively as the “Parties”. 
The definitions of certain capitalized terms used herein are set forth in
Section 12 hereto.

 

--------------------------------------------------------------------------------

 

RECITALS

 

WHEREAS, the Company and LCE Holdings, Inc., a Delaware corporation (“LCE
Holdings”), are parties to that certain Agreement and Plan of Merger, dated as
of June 20, 2005 (the “Merger Agreement”), pursuant to which LCE Holdings will
be merged with and into the Company, with the Company remaining as the surviving
corporation (the “Merger”); and

 

WHEREAS, in connection with the consummation of the transactions contemplated by
the Merger Agreement, each of the Pre-Existing Marquee Investors will receive
shares of Class A-1 and Class A-2 Common Stock of the Company, par value $0.01
per share (collectively, the “Class A Common Stock”); and

 

WHEREAS, in connection with the consummation of the transactions contemplated by
the Merger Agreement, each of the Former LCE Investors will receive shares of
Class L-1 and Class L-2 Common Stock of the Company, par value $0.01 per share
(collectively, the “Class L Common Stock”); and

 

WHEREAS, in connection with the consummation of the transactions contemplated by
the Merger Agreement, each of the stockholders of the Company or LCE Holdings
who are employees of the Company or LCE Holdings (or any of their respective
Subsidiaries) immediately prior to the Effective Time (collectively, the
“Management Stockholders”) will receive shares of Class N Common Stock of the
Company, par value $0.01 per share (the “Class N Common Stock”); and

 

WHEREAS, concurrently with the execution hereof, the Management Stockholders and
the Company are entering into that certain Amended and Restated Management
Stockholders Agreement by and among the Company, the Principal Investors and the
Management Stockholders substantially in the form of Exhibit C hereto (the
“Management Stockholders Agreement”);

 

WHEREAS, each of the Pre-Existing Marquee Investors entered into the Initial
Stockholders Agreement; and

 

WHEREAS, as of the Effective Time, each of the Investors will hold such number
of shares of Stock representing such Investor’s Percentage Interest in the
Company as listed on Schedule 2 attached hereto; and

 

WHEREAS, each of the Investors and the Company desire to amend and restate the
Initial Stockholders Agreement to include each of the Former LCE Investors as
parties hereto and to amend certain provisions of the Initial Stockholders
Agreement; and

 

WHEREAS, pursuant to Section 14(j) of the Initial Stockholders Agreement, the
JPMP Investors, the Apollo Investors and the Company have the authority to
approve such amendments to the Initial Stockholders Agreement as are set forth
herein.

 

2

--------------------------------------------------------------------------------

 

NOW, THEREFORE, in consideration of the foregoing, and the mutual agreements set
forth herein and other good and valuable consideration, the receipt and adequacy
of which is hereby acknowledged, the Parties hereto, intending to be legally
bound, hereby agree as follows:

 

AGREEMENT

 

SECTION 1.         TRANSFERS

 

(a)           Transfer Restrictions.  Each of the Investors agrees and
acknowledges that, except as provided in this Section 1, it will not, directly
or indirectly (through one or more of its Affiliates or otherwise), Transfer any
Shares except (i) for Permitted Transfers (in compliance with and subject to the
provisions of Sections 2, 3 and 4 for Permitted Transfers within the meaning of
clause (i) of the definition thereof occurring at any time prior to the IPO
Date), provided that as a condition to any Permitted Transfer pursuant to clause
(i), (ii) or (v) of the definition of Permitted Transfer (whether prior or
subsequent to the IPO Date), the transferee of Shares in such Permitted Transfer
shall agree in writing to be bound by, and to comply with, all applicable
provisions of, and to be deemed to be an Investor for purposes of, this
Agreement, (ii) after the Blockout Period and prior to the IPO Date, for
Transfers of Shares in compliance with and subject to the provisions of Sections
2, 3 and 4, (iii) after the IPO Date, for Transfers of Shares in compliance with
and subject to the provisions of Section 4, (iv) at any time prior to the IPO
Date, for Transfers of Shares in an Exit Sale pursuant to Section 3 and (v) at
any time after the IPO Date, for Transfers of Shares pursuant to a Public Sale
in compliance with and subject to Section 1(c).  Notwithstanding and without
limiting the foregoing, no Investor shall be permitted, without the prior
written consent of the Requisite Stockholder Majority, to (i) Transfer any
Shares to any Person that competes in any material respect with the business
conducted by the Company or any of its Subsidiaries at the time of such proposed
Transfer (except a Transfer pursuant to a Public Sale), (ii) pledge, hypothecate
or grant any security interest in any Shares, or (iii) prior to the IPO Date,
Transfer any Shares in any manner that would violate, cause a default,
constitute a “change of control” or trigger a requirement to repurchase or offer
to repurchase or similar event, under any of the Company’s or any of the
Company’s Subsidiaries’ material debt agreements, indentures and other
agreements or instruments evidencing material indebtedness of the Company or any
of its Subsidiaries, as such agreements, indentures and instruments may be
amended or modified from time to time in accordance with their terms; provided,
that the foregoing clauses (i) and (iii) shall not apply to any Company Sale
and; provided, further, that the foregoing clause (iii) shall not apply if in
connection with such Transfer of Shares, the material indebtedness of the
Company or any of its Subsidiaries is amended, modified or refinanced such that
there does not exist a violation, default or “change of control” pursuant to
such material indebtedness.  For purposes of determining whether a Transfer of
Shares would constitute a “change of control,” Shares sold by any Investor
pursuant to Tag-Along Rights provided in Section 4 shall be included in such
calculation.  As a condition to any Transfer of Shares prior to the IPO Date
(other than in connection with an Exit Sale), the transferee of such Shares
shall (i) execute a counterpart of this Agreement in the form attached hereto as
Exhibit A and become a party to this Agreement (ii) be bound by the terms hereof
for all purposes hereunder and (iii) be treated as an Investor hereunder (but
not as a Principal Investor unless (A) the transferor was a Principal Investor,

 

3

--------------------------------------------------------------------------------

 

and (B) each Principal Investor consents in their respective sole discretion)
with the same rights and obligations of an Investor (but not as a Principal
Investor unless (A) the transferor was a Principal Investor, and (B) each
Principal Investor consents in their respective sole discretion) for all
purposes of this Agreement.

 

(b)           Transfer Notice.  Prior to any proposed Transfer of any Shares,
the Investor holding such Shares to be Transferred shall give written notice to
the Company of its intention to effect such Transfer (the “Transfer Notice”). 
Such Transfer Notice shall set forth in reasonable detail the terms and
conditions of such proposed Transfer, including (i) the percentage of such
Selling Investor’s Shares that would be Transferred, (ii) the number of Shares
proposed to be Transferred (the “Offered Shares”), (iii) the proposed amount and
form of consideration to be paid for the Offered Shares and (iv) all other
material terms of the proposed Transfer.  In the event that the terms and/or
conditions set forth in the Transfer Notice are thereafter amended in any
material respect, the Transfer Notice shall be of no further force and effect
and the transferring Investor shall give a new Transfer Notice containing such
amended terms and conditions.  Subject to compliance with Section 1, 2, 3 and 4
herein (including any applicable time periods set forth in those Sections), and
subject to Section 6(c) herein, the Investor holding such Shares to be
Transferred shall have the right, after receipt by the Company and the other
Investors of the Transfer Notice, to Transfer Shares in accordance with the
terms set forth in such Transfer Notice.

 

(c)           Restrictions on Transfers under Rule 144.  After the IPO Date,
each Specified Holder shall promptly notify each Related Holder when it has
commenced a measurement period for purposes of the Rule 144 group volume limit
in connection with a Transfer that is subject to such limit and what the volume
limit for such measurement period, determined as of its commencement, will be. 
Each Related Holder shall be entitled to effect Transfers that are subject to
the Rule 144 group volume limit pro rata during the applicable measurement
period based on the ratio of the relative number of Shares owned by such Related
Holder to the number of Shares owned by all Specified Holders and Related
Holders at the start of the measurement period.  In the event any Related Holder
agrees to forego its full pro rata share of the Rule 144 group volume limit by
written notice thereof to the Specified Holder and all other Related Holders,
the remainder shall be reallocated pro rata among the Specified Holder and all
other Related Holders in like manner (except that the Shares held by such
foregoing Related Holder at the start of such measurement period shall be
excluded from such calculation).  The provisions of this Section 1(c) shall not
apply to any Transfer of Shares (i) pursuant to clause (i) of the definition of
Public Sale or (ii) not subject to volume limitations under Rule 144.

 

SECTION 2.         RIGHT OF FIRST OFFER

 

(a)           Company Right of First Offer.  Subject to Section 2(i), if, at any
time prior to the IPO Date, an Investor (a “Selling Investor”) proposes to
Transfer any Shares to any Person (the “Offeror”), such Selling Investor shall
comply with the provisions of this Section 2.  Within five (5) Business Days of
receipt of the Transfer Notice (the “Company Election Period”), the Company
shall have the irrevocable right to elect to purchase all, or a portion, of the
Offered Shares at the price and on the terms and conditions set forth in the
Transfer Notice by delivery of a written notice to the Selling Investor (the
“Company Election Notice”).  The Company Election Notice will be binding on and
enforceable against the Company with respect to the purchase and sale of all of
such Offered Shares at the price and on the terms and conditions set forth in
the Transfer Notice.

 

4

--------------------------------------------------------------------------------

 

(b)           Investor Right of First Offer.  If the Company elects not to
exercise its right to purchase all of the Offered Shares within the Company
Election Period or elects to purchase less than all of the Offered Shares, the
Company shall give each Investor notice of such election and deliver to each
Investor other than the Selling Investor (each, a “Non-Selling Investor”) and
each Management Stockholder a copy of the Transfer Notice within two
(2) Business Days after the expiration of the Company Election Period, then,
within twelve (12) Business Days of the date the Company Election Period
terminates (the “Investor Election Period”), each Non-Selling Investor shall
have the right to elect (which election shall be irrevocable) to purchase up to
that portion (pro rata based upon the relative number of Shares owned by such
Non-Selling Investor to the Shares owned by all other Non-Selling Investors at
such time) of the remaining Offered Shares at the price and on the terms and
conditions set forth in the Transfer Notice by delivery of a written notice to
the Company (the “Investor Election Notice”).  The Investor Election Notice will
be binding on and enforceable against each Non-Selling Investor with respect to
the purchase and sale of all of such Offered Shares at the price and on the
terms and conditions set forth in the Transfer Notice.

 

(c)           Investor Over-Allotment Period.  If the Company has elected not to
exercise its right to purchase all of the Offered Shares within the Company
Election Period or elected to purchase less than all of the Offered Shares and
the Non-Selling Investors have in the aggregate elected to purchase some but
less than all of the Offered Shares, the Company shall give those Non-Selling
Investors, if any, who elected to purchase all of the Offered Shares (a “Fully
Subscribed Non-Selling Investor”) which were available to be purchased by them
pursuant to Section 2(b), a notice within two (2) Business Days of the expiry of
the Investor Election Period of the number of additional Offered Shares
available to be purchased (the “Remaining Offered Shares”).  Each Fully
Subscribed Non-Selling Investor may elect (which election shall be irrevocable)
to purchase up to its pro rata share (based on the ratio of the relative number
of Shares owned by such Fully Subscribed Non-Selling Investor to the number of
Shares owned by all of the Fully Subscribed Non-Selling Investors) of the
Remaining Offered Shares by delivery to the Company of a written notice (the
“Second Investor Election Notice”) within seven (7) Business Days of the expiry
of the Investor Election Period (the “Second Investor Election Period”).  In
anticipation of the contingency that not all of the Remaining Offered Shares are
elected to be purchased pursuant to the preceding sentence (any such Remaining
Offered Shares not elected to be purchased, the “Additional Remaining Offered
Shares”), each Fully Subscribed Non-Selling Investor may also elect prior to the
expiry of the Second Investor Election Period (which election shall be made
concurrently and on the same form as the election in the previous sentence, and
in any event shall be irrevocable) to purchase up to all of the Additional
Remaining Offered Shares; provided that the Investors shall, as much as
reasonably practicable, consult with each other and coordinate the exercise of
rights such that all Remaining Offered Shares and Additional Remaining Offered
Shares are elected to be purchased and each shall use all reasonable efforts to
inform the others of the actions it will take at least three (3) Business Days
in advance of the expiration of the Second Investor Election Period and to
inform each other as promptly as practicable of any change of intention made
thereafter, but prior to the expiration of the Second Investor Election Period. 
To the extent that there are Remaining Offered Shares and the Fully Subscribed
Non-Selling Investors have, in the aggregate, elected to purchase more of the
Remaining Offered Shares than are available, such Remaining Offered Shares shall
be apportioned pro rata amongst the Fully Subscribed Non-Selling Investors who
have elected to

 

5

--------------------------------------------------------------------------------

 

purchase Remaining Offered Shares (determined based on the ratio of the number
of Shares owned by each such Fully Subscribed Non-Selling Investor who has
elected to purchase more than their pro rata portion of Remaining Offered Shares
to the aggregate number of Shares held by all such Fully Subscribed Non-Selling
Investors who have elected to purchase more than their pro rata portion of
Remaining Offered Shares).

 

(d)           Restrictions.  The right of each of the Company and the
Non-Selling Investor as provided for in this Section 2 will be void ab initio if
the Company Election Notice, all Investor Election Notices and all Second
Investor Election Notices, collectively constitute an offer to purchase less
than all of such Offered Shares.

 

(e)           Exercise.  Provided that the Company Election Notice, all Investor
Election Notices and all Second Investor Election Notices, collectively
constitute an offer to purchase all of such Offered Shares, then within ten
(10) days of receipt of the Company Election Notice, the Investor Election
Notice, and the Second Investor Election Notice, as the case may be, either the
Company or any Non-Selling Investor, or both (in each case, the “Electing
Party”), shall deliver to the Selling Investor (by certified check or wire
transfer in immediately available funds to an account specified by the Selling
Investor) the purchase price of such Offered Shares to be purchased by the
Electing Party, and the Selling Investor shall deliver stock certificates duly
endorsed for Transfer or with duly executed stock powers or similar instruments,
or such other instrument of Transfer of such Transferred Shares as may be
reasonably requested by the Electing Party with all stock transfer taxes paid
and stamps affixed.  If any Governmental Approval is required in connection with
any such purchase of Offered Shares and such Governmental Approval has not been
completed or obtained on or prior to the date scheduled for closing, the closing
of the purchase of all Offered Shares shall take place on the third Business Day
after such Governmental Approval has been completed or obtained.  The Selling
Investor and the Electing Party shall each use reasonable efforts to complete or
obtain any such required Governmental Approval; provided, however, that neither
the Selling Investor nor the Electing Party shall be required to agree to any
divestiture or operational constraint or pay any material amount of money (other
than the filing fee payable in connection with any notification required under
the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, or in
connection with any notification or filing under any foreign competition laws
which shall be paid by such Electing Party) as a condition of obtaining such
Governmental Approval.   If each of the Parties has acted in good faith to
complete or obtain any such required Governmental Approval and such Governmental
Approval has not been completed or obtained on or before the date which is
ninety (90) days after receipt by the Selling Investor of the Company Election
Notice, the Investor Election Notice or the Second Investor Election Notice, as
the case may be, the proposed sale of Offered Shares subject to such required
Governmental Approval shall be cancelled with respect to such Electing Party
and, for all purposes, such Electing Party shall be deemed to have elected not
to purchase such Offered Shares pursuant to this Section 2, and the Selling
Investor shall be free to Transfer the Offered Shares to (i) any Non-Selling
Investors, if any remain, and the Company in accordance with this Section 2;
provided, that the right of each of the Company and such Non-Selling Investors
set forth in this Section 2 will be void ab initio if the Company and such
Non-Selling Investors, collectively, offer to purchase less than all of the
Offered Shares or (ii) in the absence of any remaining Non-Selling Investor, the
Offeror.  Each Electing Party shall only be required to give customary
representations and warranties, including legal authority and capacity,

 

6

--------------------------------------------------------------------------------

 

non-contravention of other agreements to which it is a party and customary stock
investor representations.  Each Electing Party shall be required to enter into
any instrument, undertaking or obligation necessary or reasonably requested and
deliver all documents necessary or reasonably requested in connection with such
sale (as specified in the Transfer Notice) as a condition to the exercise of
such holder’s rights to Transfer Shares under this Section 2.

 

(f)            Acceptance of Offer.  Subject to Section 4, if the Company and
the Non-Selling Investors have not collectively elected to purchase all of the
Offered Shares prior to the expiry of the Investor Election Period or the Second
Investor Election Period, as the case may be, the Selling Investor shall have
the right to Transfer the Offered Shares specified in the Transfer Notice in
accordance with the terms of this Agreement, but only at a price and upon terms
and conditions in the aggregate no less favorable to the Selling Investor than
those stated in the Transfer Notice and only if the consummation of sale occurs
on a date within ninety (90) days from the end of the Investor Election Period
or the Second Investor Election Period, as the case may be.

 

(g)           Consideration.  For purposes of calculating the purchase price of
any such Transfer, if any portion of the consideration is paid other than in
cash, the Fair Market Value of any non-cash consideration shall be determined in
accordance with the definition of Fair Market Value and any Electing Party may
deliver an amount of cash equal to the Fair Market Value of such non-cash
consideration in consideration for the Shares to be purchased by such Electing
Party.

 

(h)           Closing.  The closing of the transactions contemplated by this
Section 2 shall occur at the principal place of business of the Company unless
otherwise agreed to in writing by the parties to such transaction.

 

(i)            Certain Provisions Applicable to the ROFO.  Notwithstanding the
foregoing: (i) prior to any Transfer of Shares by a Selling Investor pursuant to
this Section 2, the Selling Investor shall, after complying with the provisions
of this Section 2, comply with the provisions of Section 4 hereof, if
applicable; (ii) neither the Company nor any Investor shall be entitled to the
right of first offer (“ROFO”) under this Section 2 with respect to a Permitted
Transfer of any Shares within the meaning of clauses (ii), (iii), (iv), or, in
the event the Transfer is pursuant to a registration involving an Initial Public
Offering, (v) of the definition of Permitted Transfer; (iii) no Investor shall
be entitled to the ROFO under this Section 2 at any time that it owns less than
5% of such Investor’s Initial Investor Shares; (iv) no Investor shall be
entitled to the ROFO under this Section 2 in connection with a Company Sale that
is a merger, consolidation, business combination or similar transaction
involving a sale of all or substantially all of the Company; and (v) no Investor
shall be entitled to the ROFO under this Section 2 in connection with an Exit
Sale pursuant to Section 3.

 

(j)            Time Limitation.  If at the end of the 90th day after the end of
the Investor Election Period or the Second Investor Election Period, as the case
may be, the Selling Investor has not completed the proposed Transfer, the
Transfer Notice shall be null and void, and it shall be necessary for a separate
Transfer Notice to be delivered, and the terms and provisions of this Section 2
separately complied with, in order to consummate such Transfer pursuant to this
Section 2.

 

7

--------------------------------------------------------------------------------

 

(K)           INVESTOR EXPENSES.  THE COMPANY WILL PAY THE REASONABLE FEES AND
EXPENSES OF LEGAL COUNSEL (AND SUCH LOCAL COUNSEL AS MAY BE APPROPRIATE) FOR THE
SPECTRUM INVESTORS, COLLECTIVELY, UNTIL SUCH TIME AS THE SPECTRUM INVESTORS
COLLECTIVELY CEASE TO HOLD INVESTOR SHARES REPRESENTING AT LEAST 25% OF THE
INITIAL INVESTOR SHARES HELD BY THE SPECTRUM INVESTORS (AS MAY BE ADJUSTED FOR
STOCK SPLITS, STOCK DIVIDENDS, RECAPITALIZATIONS, PRO-RATA SELLDOWNS OR SIMILAR
EVENTS), AND LEGAL COUNSEL (AND SUCH LOCAL COUNSEL AS MAY BE APPROPRIATE) FOR
EACH OF THE PRINCIPAL INVESTORS, IN CONNECTION WITH ANY TRANSACTION THAT IS THE
SUBJECT OF THIS SECTION 2.

 

SECTION 3.         DRAG-ALONG RIGHTS

 

(a)           Drag-Along Right.  At any time prior to the IPO Date, Investors
constituting a Requisite Stockholder Majority (collectively, the “Drag-Along
Sellers”) may require each other Investor (the “Required Sellers”) to
participate in any Company Sale pursuant to which the Drag-Along Sellers are
Transferring at least 90% of the then outstanding Shares then held by the
Drag-Along Sellers for consideration consisting of cash and cash equivalents (an
“Exit Sale”) to an Independent Third Party (a “Drag-Along Transferee”) in a bona
fide arm’s length transaction or series of transactions (including pursuant to a
stock sale, asset sale, recapitalization, tender offer, merger or other business
combination transaction or otherwise) at the purchase price and upon the terms
and subject to the conditions of the Exit Sale (all of which shall be set forth
in the Drag-Along Notice as hereinafter defined).  In connection with an Exit
Sale, the Company may also require each Required Seller to vote in favor of such
Exit Sale or act by written consent approving the same with respect to all
Shares owned by such Required Seller, as necessary or desirable to authorize,
approve and adopt the Exit Sale.  Without limiting the foregoing, if an Exit
Sale requires the approval of the Company’s stockholders, each Investor shall
waive any dissenters’ rights, appraisal rights or similar rights in connection
with such Exit Sale or Company Sale.  In the event that a sale is proposed
pursuant to this Section 3, all outstanding proposals to Transfer Shares shall
immediately be withdrawn and no Transfer of Shares shall be consummated until
the expiration of the time period provided for in Section 3(e).  The
consummation of an Exit Sale by the Drag-Along Sellers shall be subject to the
sole discretion of the Drag-Along Sellers, who shall have no liability or
obligation whatsoever (other than compliance with this Section 3) to any
Required Sellers participating therein in connection with such Required Sellers’
Transfer of Shares.

 

(b)           Notice.  The rights set forth in Section 3(a) shall be exercised
by the Drag-Along Sellers giving written notice (the “Drag-Along Notice”) to
each Required Seller and the Company, at least ten (10) Business Days prior to
the date on which the Drag-Along Sellers expect to consummate the Transfer
giving rise to such Drag-Along Right.  In the event that the terms and/or
conditions set forth in the Drag-Along Notice are thereafter amended in any
material respect, the Drag-Along Sellers shall give written notice (an “Amended
Drag-Along Notice”) of the amended terms and conditions of the proposed Transfer
to each Required Seller and the Company.  Each Drag-Along Notice and Amended
Drag-Along Notice shall set forth:  (i) the name of the Drag-Along Transferee
and the amount of Shares proposed to be purchased by such Drag-Along Transferee,
(ii) the proposed amount and type of consideration and material terms and
conditions of payment offered by the Drag-Along Transferee, and (iii) a summary
of any other material terms pertaining to the Transfer.

 

8

--------------------------------------------------------------------------------

 

(c)           Exercise.  All Transfers of Shares to the Drag-Along Transferee
pursuant to this Section 3 shall be consummated simultaneously at the offices of
the Company, unless the Drag-Along Sellers elect otherwise, on the later of
(i) a Business Day not less than ten (10) or more than sixty (60) days after the
Drag-Along Notice is received by such Required Sellers and the Company or
(ii) the third Business Day following receipt of all material Governmental
Approvals, or at such other time and/or place as each of the parties to such
Transfers may agree.  The delivery of stock certificates shall be made on such
date, against payment of the purchase price for such Shares, duly endorsed for
Transfer or with duly executed stock powers or similar instruments, or such
other instrument of Transfer of such Shares as may be reasonably requested by
the Drag-Along Sellers and the Company, with all stock transfer taxes paid and
stamps affixed.  Each Required Seller shall receive the same form and amount of
consideration received by the Drag-Along Sellers per Share.  To the extent that
the Parties (or any successors thereto) are to provide any indemnification or
otherwise assume any other post-closing liabilities, the Drag-Along Sellers and
all Required Sellers selling Shares in a transaction under this Section 3 shall
do so severally and not jointly (and on a pro rata basis in accordance with the
Shares being sold by each) and their respective potential liability thereunder
shall not exceed the proceeds received.  Furthermore, each Required Seller shall
only be required to give customary representations and warranties, including
title to Shares conveyed, legal authority and capacity, and non-contravention of
other agreements to which it is a party, with respect to which indemnification
or other post-closing liabilities shall be several and not joint (and only as to
the representations and warranties given by such Required Seller) and their
respective potential liability thereunder shall not exceed the proceeds
received; provided, that in connection with such transaction no Investor shall
be required to enter into any non-competition agreement.  Each Required Seller
shall be required to enter into any instrument, undertaking or obligation
necessary or reasonably requested and deliver all documents necessary or
reasonably requested in connection with such sale (as specified in the
Drag-Along Notice) in connection with this Section 3.

 

(d)           Time Limitation.  If at the end of the 90th day after the receipt
of the Drag-Along Notice the Drag-Along Sellers have not completed the proposed
Transfer, the Drag-Along Notice shall be null and void, and it shall be
necessary for a separate Drag-Along Notice to be delivered, and the terms and
provisions of this Section 3 separately complied with, in order to consummate
such Transfer pursuant to this Section 3; provided, that such 90 day time period
may be extended at the option of the Drag-Along Sellers for a reasonable period
of time not to exceed an additional 90 days to the extent that the failure to
complete the proposed Transfer has resulted from the failure to obtain the
necessary Governmental Approvals with respect to the Exit Sale.

 

(E)           INVESTOR EXPENSES.  THE COMPANY WILL PAY THE REASONABLE FEES AND
EXPENSES OF LEGAL COUNSEL (AND SUCH LOCAL COUNSEL AS MAY BE APPROPRIATE) FOR THE
SPECTRUM INVESTORS, COLLECTIVELY, UNTIL SUCH TIME AS THE SPECTRUM INVESTORS
COLLECTIVELY CEASE TO HOLD INVESTOR SHARES REPRESENTING AT LEAST 25% OF THE
INITIAL INVESTOR SHARES HELD BY THE SPECTRUM INVESTORS (AS MAY BE ADJUSTED FOR
STOCK SPLITS, STOCK DIVIDENDS, RECAPITALIZATIONS, PRO-RATA SELLDOWNS OR SIMILAR
EVENTS), AND LEGAL COUNSEL (AND SUCH LOCAL COUNSEL AS MAY BE APPROPRIATE) FOR
EACH OF THE PRINCIPAL INVESTORS, IN CONNECTION WITH ANY TRANSACTION THAT IS THE
SUBJECT OF THIS SECTION 3.

 

9

--------------------------------------------------------------------------------

 

SECTION 4.         TAG-ALONG RIGHTS

 

(a)           Notice.  Subject to Section 4(d) and after complying with the
provisions of Section 2 to the extent applicable, if at any time (including, for
the avoidance of doubt, following the IPO Date) a Selling Investor (referred to
in this Section 4 as the “Tag-Along Seller”) proposes to Transfer Shares held by
such Tag-Along Seller to any Person other than the Company (except where the
Tag-Along Seller is a Principal Investor and the transferee is the Company, in
which case the provisions of this Section 4 will apply) or the Non-Selling
Investors pursuant to Section 2, whether in one transaction or in a series of
related transactions, then such Tag-Along Seller shall comply with the
provisions of this Section 4.  In addition to the information required to be
provided in the Transfer Notice pursuant to Section 1(b), the Tag-Along Seller
shall provide additional information with respect to the proposed Transfer as
reasonably requested by the Non-Selling Investors to the Company.  Following
receipt of such additional information, the Company shall promptly deliver such
additional information to the Management Stockholders and the Non-Selling
Investors.

 

(b)           Tag-Along Right.  If the Company and the Non-Selling Investors
have in the aggregate not elected to purchase all of the Offered Shares pursuant
to Section 2, the Company shall give the Non-Selling Investors and the
Management Stockholders, a notice within two (2) Business Days after the expiry
of the Investor Election Period or the Second Investor Election Period, as the
case may be, that all of the Offered Shares were not elected to be purchased and
informing such Non-Selling Investor of their opportunity to participate in a
tag-along sale pursuant to this Section 4 and informing the Management
Stockholders of their opportunity to participate in the tag-along sale pursuant
to the Management Stockholders Agreement.  The Non-Selling Investors and the
Management Stockholders shall have the right, exercisable upon written notice to
the Tag-Along Seller within seven (7) Business Days after the expiration of the
Investor Election Period or the Second Investor Election Period, as the case may
be (the “Tag-Along Election Period”), to participate in the proposed Transfer by
the Tag-Along Seller to any Person (the “Tag-Along Transferee”) on the terms and
conditions set forth in such Transfer Notice (such participation rights being
hereinafter referred to as “Tag-Along Rights”).  Any Non-Selling Investor and
any Management Stockholder that has not notified the Tag-Along Seller of its
intent to exercise Tag-Along Rights within the Tag-Along Election Period shall
be deemed to have elected not to exercise such Tag-Along Rights with respect to
the sale contemplated by such Transfer Notice and the Tag-Along Seller and the
Non-Selling Investors and the Management Stockholders who have exercised such
Tag-Along Rights shall thereafter be free to Transfer to the Tag-Along
Transferee at a per share price no greater than the per share price set forth in
the Transfer Notice with respect to such Transfer and on other terms and
conditions that are not materially more favorable to the Tag-Along Seller and
the Non-Selling Investors and the Management Stockholders who have exercised
such Tag-Along Rights than those set forth in such Transfer Notice, without any
further obligation to such Non-Selling Investor(s) and Management Stockholder(s)
pursuant to this Section 4(b) that have not provided notice to exercise
Tag-Along Rights.  Each Non-Selling Investor and Management Stockholder that
elects to exercise Tag-Along Rights may participate with respect to the Shares
owned by such Investor or with respect to the number of whole Restricted Shares
(as defined in the Management Stockholders Agreement), including any
(a) Restricted Shares issuable upon exercise of Vested Options (as defined in
the Management Stockholders Agreement) or (b) any Restricted Shares

 

10

--------------------------------------------------------------------------------

 

that will be issuable pursuant to options that vest as a result of the
consummation of the Transfer to the Tag-Along Transferee (collectively,
“Management Shares”), as the case may be, in an amount equal to the product
obtained by multiplying (i) in the case of Non-Selling Investor, the aggregate
number of Shares owned by such Non-Selling Investor on the date of the sale and,
in the case of a Management Stockholder, the aggregate number of Management
Shares owned by such Management Stockholder on the date of the Sale by (ii) a
fraction, the numerator of which is equal to the number of Shares proposed to be
sold by the Tag-Along Seller and the denominator of which is the aggregate
number of Shares owned by the Tag-Along Seller (the “Eligible Shares”).  If one
or more Non-Selling Investors and Management Stockholders elects not to include
the maximum number of Eligible Shares in a proposed sale, the Tag-Along Seller
shall give prompt notice to each other participating Non-Selling Investors and
participating Management Stockholders and such other participating Investor and
participating Management Stockholders may sell in the proposed sale a number of
additional Shares or Management Shares, as the case may be, owned by any of them
equal to their pro rata portion (based upon the aggregate number of Shares owned
by such Investor or the aggregate number of Management Shares owned by such
Management Stockholder, as the case may be, relative to the aggregate number of
Shares and Management Shares owned by all Investors and Management Stockholders)
of the number of Shares and Management Shares eligible to be included in the
proposed Transfer.  Such additional Shares and Management Shares which any such
Non-Selling Investor(s) or Management Stockholder(s) proposes to sell shall not
be included in the calculation of Eligible Shares of such Non-Selling Investor
or Management Stockholder.  To the extent that the total number of Shares and
Management Shares proposed to be sold by the Tag-Along Seller and the number of
Eligible Shares proposed to be Transferred by all of the Non-Selling Investors
and Management Stockholders collectively exceeds the number of Shares and
Management Shares that the Tag-Along Transferee is willing to acquire, the
number of Shares and Management Shares that the Tag-Along Seller and each
Non-Selling Investor and Management Stockholder propose to Transfer will be
reduced pro rata based upon the relative number of Shares and Management Shares
that the Tag-Along Seller and each such Non-Selling Investor and Management
Stockholder had proposed to Transfer.

 

(c)           Exercise.  At the closing of the Transfer to any Tag-Along
Transferee pursuant to this Section 4, the delivery of stock certificates shall
be made on such date by the Tag-Along Seller and such Non-Selling Investors and
Management Stockholders exercising Tag-Along Rights, against payment of the
purchase price for such Shares and Management Shares, duly endorsed for Transfer
or with duly executed stock powers or similar instruments, or such other
instrument of Transfer of such Shares and Management Shares as may be reasonably
requested by the Tag-Along Transferee and the Company, with all stock transfer
taxes paid and stamps affixed.  The consummation of such proposed Transfer shall
be subject to the sole discretion of the Tag-Along Seller, who shall have no
liability or obligation whatsoever (other than compliance with this Section 4)
to any Non-Selling Investor or Management Stockholder participating therein in
connection with such Non-Selling Investor’s or Management Stockholder’s Transfer
of Shares or Management Shares.  Each Non-Selling Investor and Management
Stockholder exercising Tag-Along Rights shall receive the same amount and form
of consideration received by the Tag-Along Seller per each Share on the same
terms and conditions as the Tag-Along Seller.  To the extent that the Parties
(or any successors thereto) are to provide any indemnification or otherwise
assume any other post-closing liabilities, the Tag-Along Seller and all
Non-Selling Investors and

 

11

--------------------------------------------------------------------------------

 

Management Stockholders exercising Tag-Along Rights shall do so severally and
not jointly (and on a pro rata basis in accordance with the Shares being
Transferred by each), and their respective potential liability thereunder shall
not exceed the proceeds received.  Furthermore, each Investor shall only be
required to give customary representations and warranties, including title to
Shares conveyed, legal authority and capacity, and non-contravention of other
agreements to which it is a party, with respect to which indemnification or
other post-Closing liabilities shall be several and not joint (and only as to
the representations and warranties given by such Investor) and their respective
potential liability thereunder shall not exceed the proceeds received; provided,
that in connection with such transaction no Investor or Management Stockholder
shall be required to enter into any non-competition agreement.  If any
Governmental Approval is required in connection with any such Transfer of Shares
and such Governmental Approval has not been completed or obtained on or prior to
the date scheduled for closing, the closing of Transfer of Shares and Management
Shares shall take place on the third Business Day after such Governmental
Approval has been completed or obtained.  Each participating Investor shall be
required to enter into any instrument, undertaking, obligation or make any
filing necessary or reasonably requested and deliver all documents necessary or
reasonably requested in connection with such Transfer (as specified in the
Transfer Notice) as a condition to the exercise of such holder’s rights to
Transfer Shares under this Section 4.

 

(d)           Certain Restrictions.  Notwithstanding the foregoing, no Tag-Along
Rights of any Investor or Management Stockholder shall apply hereunder with
respect to any Transfers pursuant to (i) any Permitted Transfer within the
meaning of clauses (ii), (iii), (iv) or (v) of the definition of Permitted
Transfer, (ii) any Transfer pursuant to a Public Sale, (iii) any Exit Sale
pursuant to Section 3 or (iv) in the case of Management Stockholders, pursuant
to Transfers in which the Management Stockholders do not have tag along rights
pursuant to Section 4 of the Management Stockholders Agreement.

 

(e)           Time Limitation.  If at the end of the 90th day after the end of
the Investor Election Period or the Second Investor Election Period, as the case
may be, the Tag-Along Seller has not completed the proposed Transfer, the
Transfer Notice shall be null and void, and it shall be necessary for a separate
Transfer Notice to be delivered, and the terms and provisions of this Section 4
separately complied with, in order to consummate such Transfer pursuant to this
Section 4; provided, that such 90 day time period may be extended at the option
of the Tag-Along Seller for a reasonable period of time not to exceed an
additional 90 days to the extent that the failure to complete the proposed
Transfer has resulted from the failure to obtain the necessary Governmental
Approvals with respect to the Transfers.

 

(F)            INVESTOR EXPENSES.  THE COMPANY WILL PAY THE REASONABLE FEES AND
EXPENSES OF LEGAL COUNSEL (AND SUCH LOCAL COUNSEL AS MAY BE APPROPRIATE) FOR THE
SPECTRUM INVESTORS, COLLECTIVELY, UNTIL SUCH TIME AS THE SPECTRUM INVESTORS
COLLECTIVELY CEASE TO HOLD INVESTOR SHARES REPRESENTING AT LEAST 25% OF THE
INITIAL INVESTOR SHARES HELD BY THE SPECTRUM INVESTORS (AS MAY BE ADJUSTED FOR
STOCK SPLITS, STOCK DIVIDENDS, RECAPITALIZATIONS, PRO-RATA SELLDOWNS OR SIMILAR
EVENTS), AND LEGAL COUNSEL (AND SUCH LOCAL COUNSEL AS MAY BE APPROPRIATE) FOR
EACH OF THE PRINCIPAL INVESTORS, IN CONNECTION WITH ANY TRANSACTION THAT IS THE
SUBJECT OF THIS SECTION 4.

 

12

--------------------------------------------------------------------------------

 

SECTION 5.         PARTICIPATION RIGHTS

 

(a)           Participation Rights.  Except as otherwise provided in
Section 5(k), on or prior to the IPO Date, the Company shall not, and shall not
permit any Subsidiary (the Company and each Subsidiary, as “Issuer”) to, issue
or sell any Shares, shares of stock or other securities (including debt
securities or other evidences of indebtedness) which are directly or indirectly
convertible into or exchangeable or exercisable for any shares of stock or other
equity securities, in each case, to any Person or Persons, including by means of
a public offering (each an “Issuance” of “Subject Securities”), except in
compliance with this provisions of this Section 5.

 

(b)           Offer.  At least ten (10) Business Days prior to the consummation
of an Issuance, a notice (the “Participation Notice”) shall be delivered by the
Issuer and received by each Investor (the “Participating Offerees”).  The
Participation Notice shall include:

 

(I)            THE PRINCIPAL TERMS AND CONDITIONS OF THE PROPOSED ISSUANCE,
INCLUDING (A) THE AMOUNT, TYPE AND TERMS OF THE SUBJECT SECURITIES TO BE
INCLUDED IN THE ISSUANCE, (B) THE NUMBER OF EQUIVALENT SHARES REPRESENTED BY
SUCH SUBJECT SECURITIES, IF APPLICABLE, (C) EACH PARTICIPATING OFFEREE’S PRO
RATA SHARE OF SUCH SUBJECT SECURITIES BASED ON SUCH PARTICIPATING OFFEREE’S
PERCENTAGE INTEREST IN THE COMPANY (THE “PARTICIPATION PORTION”), (D) THE PRICE
(INCLUDING, IF APPLICABLE, THE MAXIMUM AND MINIMUM PRICE PER EQUIVALENT SHARE)
PER UNIT OF THE SUBJECT SECURITIES, INCLUDING A DESCRIPTION OF ANY NON-CASH
CONSIDERATION THAT IS SUFFICIENTLY DETAILED TO PERMIT VALUATION THEREOF, (E) THE
PROPOSED MANNER OF DISPOSITION, (F) THE NAME AND ADDRESS OF THE PERSON TO WHOM
THE SUBJECT SECURITIES WILL BE ISSUED (THE “PROSPECTIVE SUBSCRIBER”) AND (G) IF
KNOWN, THE PROPOSED ISSUANCE DATE; AND

 

(II)           AN OFFER BY THE ISSUER TO ISSUE, AT THE OPTION OF EACH
PARTICIPATING OFFEREE, TO SUCH PARTICIPATING OFFEREE SUCH PORTION OF THE SUBJECT
SECURITIES TO BE INCLUDED IN THE ISSUANCE AS MAY BE REQUESTED BY SUCH
PARTICIPATING OFFEREE (NOT TO EXCEED SUCH PARTICIPATING OFFEREE’S PARTICIPATION
PORTION), ON THE SAME TERMS AND CONDITIONS AS EACH UNIT OF SUBJECT SECURITIES
ISSUED TO PROSPECTIVE SUBSCRIBERS.

 

(c)           Exercise.  Each Participating Offeree desiring to accept the offer
contained in the Participation Notice shall accept such offer by delivering a
written notice of such acceptance to the Issuer within ten (10) Business Days
after the receipt of the Participation Notice specifying the amount of Subject
Securities (not to exceed such Participating Offeree’s Participation Portion)
which such Participation Offeree desires to be issued (each a “Participating
Buyer”).  Each Participation Offeree who does not accept such offer in
compliance with the above requirements, including the applicable time periods,
shall be deemed to have waived all of such Investor’s rights to participate in
such Issuance, and the Issuer shall thereafter be free to issue Subject
Securities in such Issuance to the Prospective Subscriber and any Participating
Buyers, at a price no less than the minimum price set forth in the Participation
Notice and on other principal terms in the aggregate not substantially more
favorable to the Prospective Subscriber than those set forth in the
Participation Notice, without any further obligation to such non-accepting
Participating Offerees pursuant to this Section 5.  If, prior to consummation,
the terms and conditions of such proposed Issuance as set forth in the
Participation Notice shall change with the result that the price shall be less
than the minimum price set forth in the Participation Notice or

 

13

--------------------------------------------------------------------------------

 

the other principal terms shall be substantially more favorable to the
Prospective Subscriber than those set forth in the Participation Notice, it
shall be necessary for the Issuer to give written notice (an “Amended
Participation Notice”) in order to consummate such Issuance; provided, however,
that if an Amended Participation Notice is issued, each Participating Buyer
shall have an additional five (5) Business Days to exercise its right of
participation as provided in this Section 5.

 

(d)           Irrevocable Acceptance.  The acceptance of each Participating
Buyer shall be irrevocable except as hereinafter provided, and each such
Participating Buyer shall be bound and obligated to acquire in the Issuance on
the same terms and conditions, with respect to each unit of Subject Securities
issued, as the Prospective Subscriber, such amount of Subject Securities as such
Participating Buyer shall have specified in such Participating Buyer’s written
commitment.

 

(e)           Time Limitation.  If at the end of the 90th day after the receipt
of the Participation Notice the Issuer has not completed the Issuance, the
Participation Notice shall be null and void, and it shall be necessary for a
separate Participation Notice to be delivered, and the terms and provisions of
this Section 5 separately complied with, in order to consummate such Issuance
pursuant to this Section 5.

 

(f)            Other Securities.  The Issuer may condition the participation of
the Participating Offerees in an Issuance upon the purchase by such
Participating Offerees of any securities (including debt securities) other than
Subject Securities (“Other Securities”) in the event that the participation of
the Prospective Subscriber(s) in such Issuance is so conditioned.  In such case,
each Participating Buyer shall acquire in the Issuance, together with the
Subject Securities to be acquired by it, Other Securities in the same proportion
to the Subject Securities to be acquired by it as the proportion of Other
Securities to Subject Securities being acquired by the Prospective Subscriber(s)
in the Issuance, on the same terms and conditions as each unit of Subject
Securities and Other Securities being issued to the Prospective Subscriber(s).

 

(g)           Certain Legal Requirements.  In the event that the participation
in the Issuance by a Participation Offeree as a Participating Buyer would
require under applicable law (i) the registration or qualification of such
Subject Securities or of any Person as a broker or dealer or agent with respect
to such Subject Securities where such registration or qualification is not
otherwise required for the Issuance or (ii) the provision to any participant in
the Issuance of any specified information regarding the Company or any of its
Subsidiaries or the Subject Securities that is not otherwise required to be
provided for the Issuance, such Participation Offeree shall not have the right
to participate in the Issuance.  Without limiting the generality of the
foregoing, it is understood and agreed that the Issuer shall not be under any
obligation to effect a registration of such Subject Securities under the
Securities Act or similar state statutes.

 

(h)           Further Assurances.  Each Participating Buyer shall take or cause
to be taken all such reasonable actions as may be necessary or reasonably
desirable in order to expeditiously consummate each Issuance pursuant to this
Section 5 and any related transactions, including executing, acknowledging and
delivering consents, assignments, waivers and other documents or instruments;
filing applications, reports, returns and other documents or instruments with
governmental authorities; and otherwise cooperating with the Issuer and the
Prospective Subscriber.  Without limiting the generality of the foregoing, each
such Participating Buyer

 

14

--------------------------------------------------------------------------------

 

agrees to execute and deliver such subscription and other agreements specified
by the Issuer to which the Prospective Subscriber will be party.

 

(i)            Expenses.  All costs and expenses incurred by the Issuer in
connection with any proposed Issuance of Subject Securities (whether or not
consummated), including all attorneys’ fees and charges, all accounting fees and
charges and all finders, brokerage or investment banking fees, charges or
commissions, shall be paid by the Company.  Each Participating Buyer may retain,
and the Company will pay the reasonable fees and expenses of, legal counsel (and
such local counsel as may be appropriate) in connection with such proposed
Issuance of Subject Securities (whether or not consummated).  Any other costs
and expenses incurred by or on behalf of any Participating Buyer in connection
with such proposed Issuance of Subject Securities (whether or not consummated)
shall be borne by such Participating Buyer.

 

(j)            Closing.  The closing of an Issuance pursuant to this Section 5
shall take place (i) on the proposed date of Issuance, if any, set forth in the
Participation Notice (provided that consummation of any Issuance may be extended
beyond such date to the extent necessary to obtain any applicable governmental
approval or other required approval or to satisfy other conditions), (ii) if no
proposed Issuance date was required to be specified in the Participation Notice,
at such time as the Issuer shall specify by notice to each Participating Buyer,
provided that such closing with respect to a Participating Buyer shall not
(without the consent of such Participating Buyer) be prior to the date that is
ten (10) Business Days after the Company issues the applicable Participation
Notice and (iii) at such place as the Issuer shall specify by notice to each
Participating Buyer.  At the closing of any Issuance under this Section 5, each
Participating Buyer shall be delivered the notes, certificates or other
instruments evidencing the Subject Securities (and, if applicable, Other
Securities) to be issued to such Participating Buyer, registered in the name of
such Participating Buyer or any designated nominee, free and clear of any liens
or encumbrances, with any transfer tax stamps affixed, against delivery by such
Participating Buyer of the applicable consideration.

 

(k)           Excluded Transactions.  The provisions of this Section 5 shall not
apply to Issuances by the Company as follows:

 

(I)            ANY ISSUANCE OF STOCK UPON THE EXCHANGE, EXERCISE OR CONVERSION
OF ANY OPTIONS, WARRANTS OR CONVERTIBLE SECURITIES OUTSTANDING AT THE EFFECTIVE
TIME OR ISSUED AFTER THE EFFECTIVE TIME IN COMPLIANCE WITH THE PROVISIONS OF
THIS SECTION 5;

 

(II)           ANY ISSUANCE OF STOCK AT THE EFFECTIVE TIME IN CONNECTION WITH
THE CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED BY THE MERGER AGREEMENT;

 

(III)          ANY ISSUANCE OF STOCK, OPTIONS, WARRANTS OR CONVERTIBLE
SECURITIES TO OFFICERS, EMPLOYEES, DIRECTORS OR CONSULTANTS OF THE COMPANY OR
ITS SUBSIDIARIES PURSUANT TO ANY BOARD APPROVED PLAN OR OTHER ARRANGEMENT
VALIDLY ADOPTED BY THE BOARD;

 

(IV)          ANY ISSUANCE OF STOCK PURSUANT TO AN INITIAL PUBLIC OFFERING;

 

(V)           ANY ISSUANCE TO THE EXTENT APPROVED BY THE REQUISITE STOCKHOLDER
MAJORITY (A) TO STOCKHOLDERS AND MANAGEMENT OF A TARGET ENTITY IN CONNECTION
WITH ANY BUSINESS

 

15

--------------------------------------------------------------------------------

 

COMBINATION OR ACQUISITION TRANSACTION INVOLVING THE COMPANY OR ANY OF ITS
SUBSIDIARIES OR (B) IN CONNECTION WITH ANY JOINT VENTURE OR STRATEGIC
PARTNERSHIP;

 

(VI)          ANY ISSUANCE OF SHARES OF STOCK IN CONNECTION WITH ANY STOCK
SPLIT, STOCK DIVIDEND OR SIMILAR RECAPITALIZATION APPROVED BY THE REQUISITE
STOCKHOLDER MAJORITY;

 

(VII)         ANY ISSUANCE IN EXCHANGE FOR DEBT SECURITIES; OR

 

(VIII)        ANY ISSUANCE BY A SUBSIDIARY TO THE COMPANY OR A WHOLLY-OWNED
SUBSIDIARY OF THE COMPANY.

 

SECTION 6.         REGISTRATION RIGHTS

 

(A)           DEMAND REGISTRATIONS.

 

(I)            RIGHT TO DEMAND REGISTRATION.  SUBJECT TO THE TERMS OF ANY
HOLDBACK AGREEMENT AS PROVIDED IN SECTION 6(C) AND THE LIMITATIONS PROVIDED IN
THIS SECTION 6(A)(I) AND SECTION 6(A)(II), THE INVESTORS SHALL EACH HAVE THE
RIGHT AT ANY TIME FOLLOWING THE IPO DATE TO MAKE A WRITTEN REQUEST OF THE
COMPANY FOR REGISTRATION (INCLUDING A SHELF REGISTRATION) WITH THE SECURITIES
AND EXCHANGE COMMISSION (THE “COMMISSION”), UNDER AND IN ACCORDANCE WITH THE
PROVISIONS OF THE SECURITIES ACT, OF ALL OR PART OF THE REGISTRABLE STOCK
BENEFICIALLY OWNED AND HELD OF RECORD BY SUCH INVESTOR (EACH A “DEMAND
REGISTRATION” AND SUCH INVESTOR, THE “DEMANDING INVESTOR”); PROVIDED, THAT
DURING THE FIRST TWO YEARS FOLLOWING THE IPO DATE, THE CONSENT OF AT LEAST TWO
OF THE PRINCIPAL INVESTORS SHALL BE REQUIRED PRIOR TO ANY INVESTOR EXERCISING A
DEMAND REGISTRATION (IT BEING UNDERSTOOD THAT IF THE DEMANDING INVESTOR IS A
PRINCIPAL INVESTOR THE CONSENT OF ONLY ONE ADDITIONAL PRINCIPAL INVESTOR SHALL
BE REQUIRED TO EXERCISE A DEMAND REGISTRATION); AND PROVIDED, FURTHER, THAT THE
COMPANY MAY DEFER SUCH DEMAND REGISTRATION FOR A SINGLE PERIOD NOT TO EXCEED 90
DAYS DURING ANY ONE YEAR PERIOD IF THE BOARD DETERMINES IN THE EXERCISE OF ITS
REASONABLE JUDGMENT THAT TO EFFECT SUCH DEMAND REGISTRATION AT SUCH TIME WOULD
HAVE A MATERIAL ADVERSE EFFECT ON THE COMPANY, INCLUDING INTERFERING WITH ANY
PENDING OR POTENTIAL ACQUISITION, DISPOSITION OR SECURITIES OFFERING OF THE
COMPANY.  WITHIN TEN (10) DAYS AFTER RECEIPT OF THE REQUEST FOR A DEMAND
REGISTRATION IN ACCORDANCE WITH THIS SECTION 6(A)(I) AND SECTION 6(A)(II), THE
COMPANY WILL SEND WRITTEN NOTICE (THE “DEMAND NOTICE”) OF SUCH REGISTRATION
REQUEST AND ITS INTENTION TO COMPLY THEREWITH TO ALL OF THE INVESTORS AND,
SUBJECT TO SECTION 6(A)(III) BELOW, THE COMPANY WILL INCLUDE IN SUCH
REGISTRATION ALL THE REGISTRABLE STOCK WITH RESPECT TO WHICH THE COMPANY HAS
RECEIVED WRITTEN REQUESTS FROM ANY INVESTOR FOR INCLUSION THEREIN WITHIN TWENTY
(20) BUSINESS DAYS AFTER THE DATE SUCH DEMAND NOTICE IS RECEIVED.  ALL REQUESTS
MADE PURSUANT TO THIS SECTION 6(A)(I) WILL SPECIFY THE AGGREGATE QUANTITY OF
REGISTRABLE STOCK REQUESTED TO BE REGISTERED AND WILL ALSO SPECIFY THE INTENDED
METHODS OF DISPOSITION THEREOF.  UPON RECEIPT OF A DEMAND NOTICE, THE COMPANY
SHALL USE ITS COMMERCIALLY REASONABLE EFFORTS TO EFFECT REGISTRATION OF THE
REGISTRABLE STOCK TO BE REGISTERED IN ACCORDANCE WITH THE INTENDED METHOD OF
DISTRIBUTION SPECIFIED IN WRITING BY THE DEMANDING INVESTOR AS SOON AS
PRACTICABLE AND TO MAINTAIN THE EFFECTIVENESS OF SUCH REGISTRATION UNTIL THE
FIRST TO OCCUR OF (A) THE COMPLETION OF SUCH DISTRIBUTION OR (B) NINETY (90)
DAYS (ONE-HUNDRED EIGHTY (180) DAYS IN THE CASE OF A SHELF REGISTRATION);

 

16

--------------------------------------------------------------------------------

 

PROVIDED, HOWEVER, THAT IF THE COMPANY BECOMES AND IS AT THE TIME OF ITS RECEIPT
OF A DEMAND NOTICE A “WELL-KNOWN SEASONED ISSUER” (AS DEFINED IN RULE 405
PROMULGATED UNDER THE SECURITIES ACT) AND IS ELIGIBLE TO FILE AN “AUTOMATIC
SHELF REGISTRATION STATEMENT” (AS DEFINED IN RULE 405 PROMULGATED UNDER THE
SECURITIES ACT), THE COMPANY SHALL CAUSE ANY SHELF REGISTRATION PURSUANT TO THIS
SECTION 6 TO BE EFFECTED PURSUANT TO AN “AUTOMATIC SHELF REGISTRATION STATEMENT”
(AS DEFINED IN RULE 405 PROMULGATED UNDER THE SECURITIES ACT).  IF AVAILABLE TO
THE COMPANY, THE COMPANY WILL EFFECT SUCH REGISTRATION ON FORM S-3 OR ANY
EQUIVALENT OR SUCCESSOR FORM UNDER THE SECURITIES ACT IN WHICH EVENT IT SHALL
USE ITS COMMERCIALLY REASONABLE EFFORTS TO MAINTAIN THE EFFECTIVENESS OF SUCH
REGISTRATION FOR A PERIOD OF ONE-HUNDRED EIGHTY (180) DAYS.

 

(II)           NUMBER OF DEMAND REGISTRATIONS.  NOTWITHSTANDING THE FOREGOING
SECTION 6(A)(I) AND SUBJECT TO THE RESTRICTIONS THEREIN AND HEREIN, (A) EACH OF
THE PRINCIPAL INVESTORS AND THE SPECTRUM INVESTORS SHALL HAVE THE RIGHT TO AN
UNLIMITED NUMBER OF DEMAND REGISTRATIONS OF THEIR RESPECTIVE REGISTRABLE STOCK
ON FORM S-3 OR ANY EQUIVALENT OR SUCCESSOR FORM UNDER THE SECURITIES ACT, BUT NO
MORE THAN TWO SUCH DEMAND REGISTRATIONS SHALL BE EFFECTED WITHIN ANY 12 MONTH
PERIOD, AND THE RIGHT TO NO MORE THAN TWO DEMAND REGISTRATIONS OF THEIR
RESPECTIVE REGISTRABLE STOCK ON FORM S-1 OR ANY EQUIVALENT OR SUCCESSOR FORM
UNDER THE SECURITIES ACT AND (B) THE INVESTORS THAT ARE NOT PRINCIPAL INVESTORS
OR SPECTRUM INVESTORS, AS A GROUP, SHALL HAVE THE RIGHT TO NO MORE THAN ONE
DEMAND REGISTRATION, WHICH DEMAND REGISTRATION SHALL BE ON FORM S-3 OR ANY
EQUIVALENT OR SUCCESSOR FORM UNDER THE SECURITIES ACT (THE “COINVESTOR DEMAND”),
AND SHALL HAVE NO RIGHT TO A DEMAND REGISTRATION ON FORM S-1 OR ANY EQUIVALENT
OR SUCCESSOR FORM UNDER THE SECURITIES ACT; PROVIDED, HOWEVER, THE COMPANY NEED
NOT EFFECT A DEMAND REGISTRATION ON BEHALF OF ANY SUCH INVESTORS THAT ARE NOT
PRINCIPAL INVESTORS OR SPECTRUM INVESTORS UNLESS SUCH INVESTORS THAT ARE NOT
PRINCIPAL INVESTORS OR SPECTRUM INVESTORS ARE REQUESTING A DEMAND REGISTRATION
WITH RESPECT TO REGISTRABLE STOCK WITH AN AGGREGATE PRICE TO THE PUBLIC OF AT
LEAST $200 MILLION. THE COMPANY SHALL NOT BE REQUIRED TO CAUSE A REGISTRATION
PURSUANT TO SECTION 6(A)(I) TO BE DECLARED EFFECTIVE WITHIN A PERIOD OF 90 DAYS
AFTER THE DATE ANY OTHER COMPANY REGISTRATION STATEMENT WAS DECLARED EFFECTIVE
PURSUANT TO A DEMAND REGISTRATION REQUEST OR A FILING FOR THE COMPANY’S OWN
BEHALF.  A DEMAND REGISTRATION MAY BE WITHDRAWN PRIOR TO THE FILING OF THE
REGISTRATION STATEMENT WITH RESPECT TO SUCH DEMAND REGISTRATION BY THE INVESTOR
THAT MADE SUCH DEMAND REGISTRATION REQUEST AND A REGISTRATION STATEMENT MAY BE
WITHDRAWN PRIOR TO THE EFFECTIVENESS THEREOF BY THE HOLDERS OF A MAJORITY OF THE
REGISTRABLE STOCK INCLUDED THEREIN, AND, IN EITHER SUCH EVENT, SUCH WITHDRAWAL
SHALL NOT BE TREATED AS A DEMAND REGISTRATION FOR PURPOSES OF THIS
SECTION 6(A)(II).  INVESTORS OWNING A MAJORITY OF REGISTRABLE STOCK WITH RESPECT
TO A COINVESTOR DEMAND SHALL HAVE THE RIGHT TO CONTROL ALL DECISIONS REGARDING
SUCH COINVESTOR DEMAND (INCLUDING WHETHER TO EFFECTUATE OR TERMINATE SUCH
COINVESTOR DEMAND).

 

(III)          PRIORITY ON DEMAND REGISTRATIONS.  IF IN ANY DEMAND REGISTRATION
THE MANAGING UNDERWRITER OR UNDERWRITERS THEREOF IF SUCH REGISTRATION IS
UNDERWRITTEN, ADVISE THE COMPANY IN WRITING THAT IN ITS OR THEIR REASONABLE
OPINION THE NUMBER OF SECURITIES PROPOSED TO BE SOLD IN SUCH DEMAND REGISTRATION
EXCEEDS THE NUMBER THAT CAN BE SOLD IN SUCH OFFERING WITHOUT HAVING A MATERIAL
ADVERSE EFFECT ON THE SUCCESS OF THE OFFERING,

 

17

--------------------------------------------------------------------------------

 

INCLUDING AN IMPACT ON THE SELLING PRICE AND OTHER TERMS OF SUCH OFFERING (AN
“UNDERWRITER CUTBACK”), THE COMPANY WILL INCLUDE IN SUCH REGISTRATION ONLY THE
NUMBER OF SECURITIES THAT, IN THE REASONABLE OPINION OF SUCH UNDERWRITER OR
UNDERWRITERS CAN BE SOLD WITHOUT HAVING A MATERIAL ADVERSE EFFECT ON THE SUCCESS
OF THE OFFERING, AS FOLLOWS: FIRST, THE SECURITIES WHICH THE INVESTORS,
INCLUDING THE DEMANDING INVESTOR(S) (PRO RATA AMONG ALL SUCH INVESTORS ON THE
BASIS OF THE RELATIVE PERCENTAGE OF REGISTRABLE STOCK THEN HELD BY ALL INVESTORS
WHO HAVE REQUESTED THAT SECURITIES OWNED BY THEM BE SO INCLUDED), PROPOSE TO
SELL; SECOND, THE SECURITIES OF ANY ADDITIONAL HOLDERS OF THE COMPANY’S
SECURITIES ELIGIBLE TO PARTICIPATE IN SUCH OFFERING, PRO RATA AMONG ALL SUCH
PERSONS ON THE BASIS OF THE RELATIVE PERCENTAGE OF SUCH SECURITIES THEN HELD BY
EACH OF THEM; AND THIRD, THE SECURITIES PROPOSED TO BE SOLD BY THE COMPANY IN
SUCH OFFERING, IF ANY.  FOR PURPOSES OF ANY UNDERWRITER CUTBACK PURSUANT TO THIS
SECTION 6(A)(III), ALL REGISTRABLE STOCK PROPOSED TO BE SOLD BY ANY INVESTOR
SHALL ALSO INCLUDE ANY REGISTRABLE STOCK PROPOSED TO BE SOLD BY THE PARTNERS,
RETIRED PARTNERS, SHAREHOLDERS OR AFFILIATES OF SUCH INVESTOR, OR THE ESTATES
AND FAMILY MEMBERS OF ANY SUCH INVESTOR OR SUCH PARTNERS OR RETIRED PARTNERS,
ANY TRUSTS FOR THE BENEFIT OF ANY OF THE FOREGOING PERSONS AND, AT THE ELECTION
OF SUCH INVESTOR OR SUCH PARTNERS, RETIRED PARTNERS, TRUSTS OR AFFILIATES, ANY
CHARITABLE ORGANIZATION TO WHICH ANY OF THE FOREGOING SHALL HAVE CONTRIBUTED
REGISTRABLE STOCK PRIOR TO THE EXECUTION OF THE UNDERWRITING AGREEMENT IN
CONNECTION WITH SUCH DEMAND REGISTRATION, AND SUCH INVESTOR AND OTHER PERSONS
SHALL BE DEEMED TO BE A SINGLE SELLING INVESTOR, AND ANY PRO RATA REDUCTION WITH
RESPECT TO SUCH INVESTOR SHALL BE BASED UPON THE AGGREGATE AMOUNT OF REGISTRABLE
STOCK PROPOSED TO BE SOLD BY ALL ENTITIES AND INDIVIDUALS INCLUDED IN SUCH
SELLING INVESTOR, AS DEFINED IN THIS SENTENCE.  IN THE EVENT THAT THERE HAS BEEN
NO UNDERWRITER CUTBACK AND THE MANAGING UNDERWRITER OR DEMANDING INVESTOR
DETERMINES THAT ADDITIONAL SECURITIES OF THE COMPANY MAY BE SOLD IN ANY DEMAND
REGISTRATION WITHOUT HAVING A MATERIAL ADVERSE EFFECT ON THE SUCCESS OF THE
OFFERING, THE COMPANY MAY INCLUDE SUCH SECURITIES TO BE ISSUED AND SOLD BY THE
COMPANY OR COMPARABLE SECURITIES HELD BY PERSONS OTHER THAN THE PARTIES.

 

(IV)          SELECTION OF UNDERWRITERS.  EXCEPT WITH RESPECT TO ANY INITIAL
PUBLIC OFFERING, IN WHICH CASE THE MANAGING UNDERWRITER OR UNDERWRITERS SHALL BE
CHOSEN BY THE REQUISITE STOCKHOLDER MAJORITY, IF A DEMAND REGISTRATION IS TO BE
AN UNDERWRITTEN OFFERING, THE HOLDERS OF A MAJORITY OF THE REGISTRABLE STOCK TO
BE INCLUDED IN SUCH DEMAND REGISTRATION WILL SELECT A MANAGING UNDERWRITER OR
UNDERWRITERS.

 

(B)           PIGGYBACK REGISTRATIONS. IF THE COMPANY AT ANY TIME PROPOSES TO
REGISTER UNDER THE SECURITIES ACT ANY STOCK OR ANY SECURITY CONVERTIBLE INTO OR
EXCHANGEABLE OR EXERCISABLE FOR STOCK, WHETHER OR NOT FOR SALE FOR ITS OWN
ACCOUNT AND OTHER THAN PURSUANT TO A DEMAND REGISTRATION (IT BEING UNDERSTOOD
THAT AN INVESTOR MAY INCLUDE ITS REGISTRABLE STOCK IN A REGISTRATION EFFECTED
PURSUANT TO A DEMAND REGISTRATION IN ACCORDANCE WITH SECTION 6(A)), ON A FORM
AND IN A MANNER WHICH WOULD PERMIT REGISTRATION OF THE REGISTRABLE STOCK HELD BY
AN INVESTOR FOR SALE TO THE PUBLIC UNDER THE SECURITIES ACT, THE COMPANY SHALL
GIVE WRITTEN NOTICE OF THE PROPOSED REGISTRATION TO EACH INVESTOR NOT LATER THAN
THIRTY (30) DAYS PRIOR TO THE FILING THEREOF.  EACH INVESTOR SHALL HAVE THE
RIGHT TO REQUEST THAT ALL OR ANY PART OF ITS REGISTRABLE STOCK BE INCLUDED IN
SUCH REGISTRATION.  EACH INVESTOR CAN MAKE SUCH A REQUEST BY GIVING WRITTEN
NOTICE TO THE COMPANY WITHIN TEN (10) BUSINESS DAYS AFTER THE RECEIPT OF THE
COMPANY’S NOTICE OF THE

 

18

--------------------------------------------------------------------------------

 

PROPOSED REGISTRATION; PROVIDED, HOWEVER, THAT IF THE REGISTRATION IS AN
UNDERWRITTEN REGISTRATION AND THERE IS AN UNDERWRITER CUTBACK, THE COMPANY WILL
INCLUDE IN SUCH REGISTRATION ONLY THE NUMBER OF SECURITIES THAT, IN THE
REASONABLE OPINION OF SUCH UNDERWRITER OR UNDERWRITERS CAN BE SOLD WITHOUT
HAVING A MATERIAL ADVERSE EFFECT ON THE SUCCESS OF THE OFFERING, AS FOLLOWS:
FIRST, THE SECURITIES WHICH THE COMPANY PROPOSES TO SELL; SECOND, THE
REGISTRABLE STOCK OF SUCH INVESTORS, PRO RATA AMONG ALL SUCH INVESTORS ON THE
BASIS OF THE RELATIVE PERCENTAGE OF REGISTRABLE STOCK THEN HELD BY ALL INVESTORS
WHO HAVE REQUESTED THAT REGISTRABLE STOCK OWNED BY THEM BE SO INCLUDED (IT BEING
FURTHER AGREED AND UNDERSTOOD, HOWEVER, THAT SUCH UNDERWRITERS SHALL HAVE THE
RIGHT TO ELIMINATE ENTIRELY THE PARTICIPATION OF THE INVESTORS); AND THIRD, THE
COMPARABLE SECURITIES OF ANY ADDITIONAL HOLDERS OF THE COMPANY’S SECURITIES
(INCLUDING ANY SUCH SECURITIES HELD BY CURRENT OR FORMER OFFICERS OR EMPLOYEES
OF OR CONSULTANTS TO THE COMPANY), PRO RATA AMONG ALL SUCH HOLDERS ON THE BASIS
OF THE RELATIVE PERCENTAGE OF SUCH SECURITIES THEN HELD BY ALL SUCH HOLDERS WHO
HAVE REQUESTED THAT SECURITIES OWNED BY THEM BE SO INCLUDED.  FOR PURPOSES OF
ANY UNDERWRITER CUTBACK PURSUANT TO THIS SECTION 6(B), ALL REGISTRABLE STOCK
PROPOSED TO BE SOLD BY ANY INVESTOR SHALL ALSO INCLUDE ANY REGISTRABLE STOCK
PROPOSED TO BE SOLD BY THE PARTNERS, RETIRED PARTNERS, SHAREHOLDERS OR
AFFILIATES OF SUCH INVESTOR, OR THE ESTATES AND FAMILY MEMBERS OF ANY SUCH
INVESTOR OR SUCH PARTNERS OR RETIRED PARTNERS, ANY TRUSTS FOR THE BENEFIT OF ANY
OF THE FOREGOING PERSONS AND, AT THE ELECTION OF SUCH INVESTOR OR SUCH PARTNERS,
RETIRED PARTNERS, TRUSTS OR AFFILIATES, ANY CHARITABLE ORGANIZATION TO WHICH ANY
OF THE FOREGOING SHALL HAVE CONTRIBUTED REGISTRABLE STOCK PRIOR TO THE EXECUTION
OF THE UNDERWRITING AGREEMENT IN CONNECTION WITH SUCH UNDERWRITTEN REGISTRATION,
AND SUCH INVESTOR AND OTHER PERSONS SHALL BE DEEMED TO BE A SINGLE SELLING
INVESTOR, AND ANY PRO RATA REDUCTION WITH RESPECT TO SUCH INVESTOR SHALL BE
BASED UPON THE AGGREGATE AMOUNT OF SECURITIES PROPOSED TO BE SOLD BY ALL
ENTITIES AND INDIVIDUALS INCLUDED IN SUCH SELLING INVESTOR, AS DEFINED IN THIS
SENTENCE.  REGISTRABLE STOCK PROPOSED TO BE REGISTERED AND SOLD PURSUANT TO AN
UNDERWRITTEN OFFERING FOR THE ACCOUNT OF ANY INVESTOR SHALL BE SOLD TO THE
PROSPECTIVE UNDERWRITERS, ON THE TERMS AND SUBJECT TO THE CONDITIONS OF ONE OR
MORE UNDERWRITING AGREEMENTS NEGOTIATED BETWEEN THE HOLDERS OF REGISTRABLE STOCK
TO WHICH SUCH REGISTRATION STATEMENT RELATES, THE COMPANY AND THE PROSPECTIVE
UNDERWRITERS. ANY INVESTOR WHO HOLDS REGISTRABLE STOCK BEING REGISTERED IN ANY
OFFERING SHALL HAVE THE RIGHT TO RECEIVE A COPY OF THE FORM OF UNDERWRITING
AGREEMENT AND SHALL HAVE AN OPPORTUNITY TO HOLD DISCUSSIONS WITH THE LEAD
UNDERWRITER OF THE TERMS OF SUCH UNDERWRITING AGREEMENT. THE COMPANY MAY
WITHDRAW ANY REGISTRATION STATEMENT AT ANY TIME BEFORE IT BECOMES EFFECTIVE, OR
POSTPONE OR TERMINATE THE OFFERING OF SECURITIES, WITHOUT OBLIGATION OR
LIABILITY TO ANY INVESTOR.

 

(c)           Holdback Agreements.  Notwithstanding any other provision of this
Section 6, each Investor agrees that (if so required by the underwriters in an
underwritten offering and provided that such condition is applicable equally to
all Investors) it will not (and it shall be a condition to the rights of each
Investor under this Section 6 that such Investor does not) offer for Public Sale
any Stock during (i) a period not to exceed one-hundred eighty (180) days after
the effective date of any Registration Statement filed by the Company in
connection with an underwritten Initial Public Offering (except as part of such
underwritten registration or as otherwise permitted by such underwriters) and
(ii) a period not to exceed ninety (90) days after the effective date of any
Registration Statement filed by the Company in connection with any underwritten
Public Sale of Stock that is not an Initial Public Offering (except as part of
such underwritten registration or as otherwise permitted by such underwriters);
provided, however, that in each case, no Investor shall object to shortening
such period if the underwriter agrees that

 

19

--------------------------------------------------------------------------------

 

shortening such period would not materially and adversely affect the success of
the offering; and provided further, that no Investor shall be released from such
restrictions as provided in this Section 6(c) unless all Investors are similarly
so released pro rata based upon the relative number of Shares owned at such
time.

 

(d)           Expenses.  Except as otherwise required by state securities or
blue sky laws or the rules and regulations promulgated thereunder, all expenses,
disbursements and fees incurred by the Company and the Investors in connection
with any registration under this Section 6 shall be borne by the Company, except
that the following expenses shall be borne by the Investors incurring the
same:  (i) the costs and expenses of counsel to such Investor to the extent such
Investor retains counsel (except the costs of one legal counsel for all
Investors to the extent retained, which shall be borne by the Company);
(ii) discounts, commissions, fees or similar compensation owing to underwriters,
selling brokers, dealer managers or other industry professionals, to the extent
relating to the distribution or sale of such Investor’s securities; and
(iii) transfer taxes with respect to the securities sold by such Investor.

 

(e)           Registration Procedures.  In connection with any registration of
Registrable Stock under the Securities Act pursuant to this Agreement, the
Company will consult with each Investor whose equity interest is to be included
in any such registration concerning the form of underwriting agreement, shall
provide to such Investor the form of underwriting agreement prior to the
Company’s execution thereof and shall provide to such Investor and its
representatives such other documents (including comments by the Commission on
the Registration Statement) as such Investor shall reasonably request in
connection with its participation in such registration. The Company will furnish
each Investor whose Registrable Stock are registered thereunder and each
underwriter, if any, with a copy of the Registration Statement and all
amendments thereto and will supply each such Investor and each underwriter, if
any, with copies of any prospectus included therein (including a preliminary
prospectus and all amendments and supplements thereto), in such quantities as
may be reasonably necessary for the purposes of the proposed sale or
distribution covered by such registration.  The Company shall not, however, be
required to maintain the Registration Statement effective or to supply copies of
a prospectus for a period beyond ninety (90) days after the effective date of
such Registration Statement (one-hundred eighty (180) days in the case of a
Shelf Registration), or such longer period as is otherwise set forth herein or
agreed to by the Company, and, at the end of such period, the Company may
deregister any securities covered by such Registration Statement and not then
sold or distributed. In the event that the Company prepares and files with the
Commission a registration statement on any appropriate form under the Securities
Act (a “Registration Statement”) providing for the sale of Registrable Stock
held by any Investor pursuant to its obligations under this Section 6, the
Company will:

 

(I)            UPON FILING A REGISTRATION STATEMENT OR ANY PROSPECTUS RELATED
THERETO (A “PROSPECTUS”) OR ANY AMENDMENTS OR SUPPLEMENTS THERETO, FURNISH TO
THE INVESTORS WHOSE REGISTRABLE STOCK IS COVERED BY SUCH REGISTRATION STATEMENT
AND THE UNDERWRITERS, IF ANY, COPIES OF ALL SUCH DOCUMENTS;

 

(II)           PREPARE AND FILE WITH THE COMMISSION SUCH AMENDMENTS AND
POST-EFFECTIVE AMENDMENTS TO THE REGISTRATION STATEMENT AS MAY BE NECESSARY TO
KEEP SUCH REGISTRATION STATEMENT EFFECTIVE FOR THE NINETY (90) DAY PERIOD
(ONE-HUNDRED EIGHTY (180) DAYS IN THE CASE OF A SHELF REGISTRATION) REFERENCED
IN SECTION 6(E); CAUSE THE RELATED PROSPECTUS TO BE

 

20

--------------------------------------------------------------------------------

 

SUPPLEMENTED BY ANY REQUIRED PROSPECTUS SUPPLEMENT, AND AS SO SUPPLEMENTED, TO
BE FILED PURSUANT TO RULE 424 UNDER THE SECURITIES ACT; AND, COMPLY WITH THE
PROVISIONS OF THE SECURITIES ACT WITH RESPECT TO THE DISPOSITION OF ALL
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;

 

(III)          PROMPTLY NOTIFY THE INVESTORS AND THE MANAGING UNDERWRITERS, IF
ANY, AND (IF REQUESTED BY ANY SUCH PERSON OR ENTITY) CONFIRM SUCH ADVICE IN
WRITING, (A) WHEN A PROSPECTUS OR ANY PROSPECTUS SUPPLEMENT OR POST-EFFECTIVE
AMENDMENT HAS BEEN FILED, AND, WITH RESPECT TO A REGISTRATION STATEMENT OR ANY
POST-EFFECTIVE AMENDMENT, WHEN THE SAME HAS BECOME EFFECTIVE, (B) OF ANY REQUEST
BY THE COMMISSION OR ANY STATE SECURITIES COMMISSION FOR AMENDMENTS OR
SUPPLEMENTS TO A REGISTRATION STATEMENT OR RELATED PROSPECTUS OR FOR ADDITIONAL
INFORMATION, (C) OF THE ISSUANCE BY THE COMMISSION OR ANY STATE SECURITIES
COMMISSION OF ANY STOP ORDER SUSPENDING THE EFFECTIVENESS OF A REGISTRATION
STATEMENT OR THE INITIATION OF ANY PROCEEDINGS FOR THAT PURPOSE, (D) OF THE
RECEIPT BY THE COMPANY OF ANY NOTIFICATION WITH RESPECT TO THE SUSPENSION OF THE
QUALIFICATION OF ANY OF THE REGISTRABLE STOCK FOR SALE IN ANY JURISDICTION OR
THE INITIATION OR THREATENING OF ANY PROCEEDING FOR SUCH PURPOSE, AND (E) OF THE
EXISTENCE OF ANY FACT WHICH RESULTS IN A REGISTRATION STATEMENT, A PROSPECTUS OR
ANY DOCUMENT INCORPORATED THEREIN BY REFERENCE CONTAINING AN UNTRUE STATEMENT OF
A MATERIAL FACT OR OMITTING TO STATE A MATERIAL FACT REQUIRED TO BE STATED
THEREIN OR NECESSARY TO MAKE THE STATEMENTS THEREIN NOT MISLEADING;

 

(IV)          USE ITS COMMERCIALLY REASONABLE EFFORTS TO OBTAIN THE WITHDRAWAL
OF ANY ORDER SUSPENDING THE EFFECTIVENESS OF A REGISTRATION STATEMENT;

 

(V)           IF REQUESTED BY THE MANAGING UNDERWRITERS OR AN INVESTOR, PROMPTLY
INCORPORATE IN A PROSPECTUS SUPPLEMENT OR POST-EFFECTIVE AMENDMENT SUCH
INFORMATION AS THE MANAGING UNDERWRITERS OR THE INVESTORS HOLDING A MAJORITY OF
THE REGISTRABLE STOCK BEING SOLD BY INVESTORS AGREE SHOULD BE INCLUDED THEREIN
RELATING TO THE SALE OF SUCH REGISTRABLE STOCK, INCLUDING INFORMATION WITH
RESPECT TO THE AMOUNT OF REGISTRABLE STOCK BEING SOLD TO SUCH UNDERWRITERS, THE
PURCHASE PRICE BEING PAID THEREFOR BY SUCH UNDERWRITERS AND WITH RESPECT TO ANY
OTHER TERMS OF THE UNDERWRITTEN (OR BEST EFFORTS UNDERWRITTEN) OFFERING OF THE
REGISTRABLE STOCK TO BE SOLD IN SUCH OFFERING; AND MAKE ALL REQUIRED FILINGS OF
SUCH PROSPECTUS SUPPLEMENT OR POST-EFFECTIVE AMENDMENT AS SOON AS NOTIFIED OF
THE MATTERS TO BE INCORPORATED IN SUCH PROSPECTUS SUPPLEMENT OR POST-EFFECTIVE
AMENDMENT;

 

(VI)          FURNISH TO SUCH INVESTOR AND EACH MANAGING UNDERWRITER AT LEAST
ONE SIGNED COPY OF THE REGISTRATION STATEMENT AND ANY POST-EFFECTIVE AMENDMENT
THERETO, INCLUDING FINANCIAL STATEMENTS AND SCHEDULES, ALL DOCUMENTS
INCORPORATED THEREIN BY REFERENCE AND ALL EXHIBITS (INCLUDING THOSE INCORPORATED
BY REFERENCE);

 

(VII)         DELIVER TO SUCH INVESTORS AND THE UNDERWRITERS, IF ANY, AS MANY
COPIES OF THE PROSPECTUS (INCLUDING EACH PRELIMINARY PROSPECTUS) AND ANY
AMENDMENT OR SUPPLEMENT THERETO AS SUCH PERSONS OR ENTITIES MAY REASONABLY
REQUEST;

 

21

--------------------------------------------------------------------------------

 

(VIII)        PRIOR TO ANY PUBLIC SALE OF REGISTRABLE STOCK, REGISTER OR QUALIFY
OR CAUSE TO BE REGISTERED OR QUALIFIED SUCH REGISTRABLE STOCK FOR OFFER AND SALE
UNDER THE SECURITIES OR BLUE SKY LAWS OF SUCH JURISDICTIONS WITHIN THE UNITED
STATES AS ANY INVESTOR OR UNDERWRITER REASONABLY REQUESTS IN WRITING AND DO ANY
AND ALL OTHER ACTS OR THINGS NECESSARY OR ADVISABLE TO ENABLE THE DISPOSITION IN
SUCH JURISDICTIONS OF THE REGISTRABLE STOCK COVERED BY THE APPLICABLE
REGISTRATION STATEMENT; PROVIDED, HOWEVER, THAT THE COMPANY WILL NOT BE REQUIRED
TO QUALIFY GENERALLY TO DO BUSINESS IN ANY JURISDICTION WHERE IT IS NOT THEN SO
QUALIFIED OR TO TAKE ANY ACTION WHICH WOULD SUBJECT IT TO GENERAL SERVICE OF
PROCESS OR TAXATION IN ANY SUCH JURISDICTION WHERE IT IS NOT THEN SO SUBJECT;

 

(IX)           COOPERATE WITH THE INVESTORS AND THE MANAGING UNDERWRITERS, IF
ANY, TO FACILITATE THE TIMELY PREPARATION AND DELIVERY OF CERTIFICATES
REPRESENTING REGISTRABLE STOCK TO BE SOLD PURSUANT TO SUCH REGISTRATION
STATEMENT AND NOT BEARING ANY RESTRICTIVE LEGENDS, AND ENABLE SUCH REGISTRABLE
STOCK TO BE IN SUCH DENOMINATIONS AND REGISTERED IN SUCH NAMES AS THE MANAGING
UNDERWRITERS MAY REQUEST AT LEAST TWO (2) BUSINESS DAYS PRIOR TO ANY SALE OF
REGISTRABLE STOCK TO THE UNDERWRITERS;

 

(X)            IF ANY FACT DESCRIBED IN CLAUSE (III)(E) ABOVE EXISTS, PREPARE A
SUPPLEMENT OR POST-EFFECTIVE AMENDMENT TO THE APPLICABLE REGISTRATION STATEMENT
OR THE RELATED PROSPECTUS OR ANY DOCUMENT INCORPORATED THEREIN BY REFERENCE OR
FILE ANY OTHER REQUIRED DOCUMENT SO THAT, AS THEREAFTER DELIVERED TO THE
PURCHASERS OF THE REGISTRABLE STOCK BEING SOLD THEREUNDER, SUCH PROSPECTUS WILL
NOT CONTAIN AN UNTRUE STATEMENT OF A MATERIAL FACT OR OMIT TO STATE ANY MATERIAL
FACT NECESSARY TO MAKE THE STATEMENTS THEREIN NOT MISLEADING;

 

(XI)           CAUSE ALL REGISTRABLE STOCK COVERED BY THE REGISTRATION STATEMENT
TO BE LISTED ON EACH SECURITIES EXCHANGE ON WHICH SIMILAR SECURITIES ISSUED BY
THE COMPANY ARE THEN LISTED;

 

(XII)          PROVIDE AND CAUSE TO BE MAINTAINED A TRANSFER AGENT AND REGISTRAR
FOR ALL SUCH REGISTRABLE STOCK COVERED BY SUCH REGISTRATION STATEMENT NOT LATER
THAN THE EFFECTIVE DATE OF SUCH REGISTRATION STATEMENT;

 

(XIII)         OBTAIN AN OPINION FROM THE COMPANY’S COUNSEL AND A “COLD COMFORT”
LETTER FROM THE COMPANY’S INDEPENDENT AUDITORS IN CUSTOMARY FORM AND COVERING
SUCH MATTERS AS ARE CUSTOMARILY COVERED BY SUCH OPINIONS AND “COLD COMFORT”
LETTERS DELIVERED TO UNDERWRITERS IN UNDERWRITTEN PUBLIC OFFERINGS, WHICH
OPINION AND LETTER SHALL BE REASONABLY SATISFACTORY TO THE UNDERWRITER, IF ANY,
AND TO THE INVESTORS OWNING A MAJORITY IN INTEREST OF THE REGISTRABLE STOCK
BEING REGISTERED IN SUCH OFFERING, AND FURNISH TO EACH INVESTOR PARTICIPATING IN
THE OFFERING AND TO EACH UNDERWRITER, IF ANY, A COPY OF SUCH OPINION AND LETTER
ADDRESSED TO SUCH INVESTOR OR UNDERWRITER;

 

(XIV)        DELIVER PROMPTLY TO EACH INVESTOR PARTICIPATING IN THE OFFERING AND
EACH UNDERWRITER, IF ANY, COPIES OF ALL CORRESPONDENCE BETWEEN THE COMMISSION
AND THE COMPANY, ITS COUNSEL OR AUDITORS AND ALL MEMORANDA RELATING TO
DISCUSSIONS WITH THE COMMISSION OR ITS STAFF WITH RESPECT TO THE REGISTRATION
STATEMENT, OTHER THAN THOSE PORTIONS OF ANY SUCH CORRESPONDENCE AND MEMORANDA
WHICH CONTAIN INFORMATION SUBJECT TO ATTORNEY-CLIENT PRIVILEGE WITH RESPECT TO
THE COMPANY, AND, UPON RECEIPT OF SUCH

 

22

--------------------------------------------------------------------------------

 

CONFIDENTIALITY AGREEMENTS AS THE COMPANY MAY REASONABLY REQUEST, MAKE
REASONABLY AVAILABLE FOR INSPECTION BY ANY SELLER OF SUCH REGISTRABLE STOCK
COVERED BY SUCH REGISTRATION STATEMENT, BY ANY UNDERWRITER, IF ANY,
PARTICIPATING IN ANY DISPOSITION TO BE EFFECTED PURSUANT TO SUCH REGISTRATION
STATEMENT AND BY ANY ATTORNEY, ACCOUNTANT OR OTHER AGENT RETAINED BY ANY SUCH
SELLER OR ANY SUCH UNDERWRITER, ALL PERTINENT FINANCIAL AND OTHER RECORDS,
PERTINENT CORPORATE DOCUMENTS AND PROPERTIES OF THE COMPANY, AND CAUSE ALL OF
THE COMPANY’S OFFICERS, DIRECTORS AND EMPLOYEES TO SUPPLY ALL INFORMATION
REASONABLY REQUESTED BY ANY SUCH SELLER, UNDERWRITER, ATTORNEY, ACCOUNTANT OR
AGENT IN CONNECTION WITH SUCH REGISTRATION STATEMENT;

 

(XV)         PROVIDE A CUSIP NUMBER FOR ALL REGISTRABLE STOCK INCLUDED IN SUCH
REGISTRATION STATEMENT, NOT LATER THAN THE EFFECTIVE DATE OF THE APPLICABLE
REGISTRATION STATEMENT;

 

(XVI)        ENTER INTO SUCH AGREEMENTS (INCLUDING AN UNDERWRITING AGREEMENT IN
FORM REASONABLY SATISFACTORY TO THE COMPANY) AND TAKE ALL SUCH OTHER REASONABLE
ACTIONS IN CONNECTION THEREWITH IN ORDER TO EXPEDITE OR FACILITATE THE
DISPOSITION OF SUCH REGISTRABLE STOCK, AND TO THE EXTENT REQUIRED BY THE
UNDERWRITER, PARTICIPATE IN A ROAD SHOW ARRANGED BY THE UNDERWRITER WITH
INVESTORS;

 

(XVII)       MAKE AVAILABLE FOR INSPECTION BY A REPRESENTATIVE OF THE INVESTORS
THE REGISTRABLE STOCK BEING SOLD PURSUANT TO SUCH REGISTRATION STATEMENT, ANY
UNDERWRITER PARTICIPATING IN ANY DISPOSITION PURSUANT TO A REGISTRATION
STATEMENT, AND ANY ATTORNEY OR ACCOUNTANT RETAINED BY SUCH INVESTORS OR
UNDERWRITER, ALL FINANCIAL AND OTHER RECORDS, ANY PERTINENT CORPORATE DOCUMENTS
AND PROPERTIES OF THE COMPANY REASONABLY REQUESTED BY SUCH REPRESENTATIVE,
UNDERWRITER, ATTORNEY OR ACCOUNTANT IN CONNECTION WITH SUCH REGISTRATION
STATEMENT; PROVIDED, HOWEVER, THAT ANY RECORDS, INFORMATION OR DOCUMENTS THAT
ARE DESIGNATED BY THE COMPANY IN WRITING AS CONFIDENTIAL SHALL BE KEPT
CONFIDENTIAL BY SUCH PERSONS OR ENTITIES UNLESS DISCLOSURE OF SUCH RECORDS,
INFORMATION OR DOCUMENTS IS REQUIRED BY COURT OR ADMINISTRATIVE ORDER;

 

(XVIII)      OTHERWISE USE ITS COMMERCIALLY REASONABLE EFFORTS TO COMPLY WITH
ALL APPLICABLE RULES AND REGULATIONS OF THE COMMISSION AND RELEVANT STATE
SECURITIES COMMISSIONS, AND MAKE GENERALLY AVAILABLE TO THE INVESTORS EARNING
STATEMENTS SATISFYING THE PROVISIONS OF SECTION 12(A) OF THE SECURITIES ACT NO
LATER THAN FORTY-FIVE (45) DAYS AFTER THE END OF ANY 12-MONTH PERIOD (OR
ONE-HUNDRED TWENTY (120) DAYS, IF SUCH PERIOD IS A FISCAL YEAR) COMMENCING AT
THE END OF ANY FISCAL QUARTER IN WHICH REGISTRABLE STOCK OF SUCH INVESTOR IS
SOLD TO UNDERWRITERS IN AN UNDERWRITTEN OFFERING, OR, IF NOT SOLD TO
UNDERWRITERS IN SUCH AN OFFERING, BEGINNING WITH THE FIRST MONTH OF THE
COMPANY’S FIRST FISCAL QUARTER COMMENCING AFTER THE EFFECTIVE DATE OF A
REGISTRATION STATEMENT, WHICH STATEMENTS SHALL COVER SAID 12-MONTH PERIODS; AND

 

(XIX)         TAKE ALL SUCH OTHER COMMERCIALLY REASONABLE ACTIONS AS ARE
NECESSARY OR ADVISABLE IN ORDER TO EXPEDITE OR FACILITATE THE DISPOSITION OF
SUCH REGISTRABLE STOCK, INCLUDING USING COMMERCIALLY REASONABLE EFFORTS TO CAUSE
APPROPRIATE OFFICERS AND EMPLOYEES TO BE AVAILABLE, ON A CUSTOMARY BASIS AND
UPON REASONABLE NOTICE, TO MEET WITH PROSPECTIVE INVESTORS IN PRESENTATIONS,
MEETINGS, ROAD SHOWS AND DUE DILIGENCE SESSIONS.

 

23

--------------------------------------------------------------------------------

 

(f)            Conditions to Investor Rights; Indemnification by Investor.  It
shall be a condition to each Investor’s rights hereunder to have Registrable
Stock owned by it registered that:

 

(I)            SUCH INVESTOR SHALL COOPERATE WITH THE COMPANY IN ALL REASONABLE
RESPECTS BY SUPPLYING INFORMATION AND EXECUTING DOCUMENTS RELATING TO SUCH
INVESTOR OR THE SECURITIES OF THE COMPANY OWNED BY SUCH INVESTOR IN CONNECTION
WITH SUCH REGISTRATION WHICH ARE REASONABLY REQUESTED BY THE COMPANY;

 

(II)           SUCH INVESTOR SHALL ENTER INTO SUCH UNDERTAKINGS AND TAKE SUCH
OTHER ACTION RELATING TO THE CONDUCT OF THE PROPOSED OFFERING WHICH THE COMPANY
OR THE UNDERWRITERS MAY REASONABLY REQUEST AS BEING NECESSARY TO ENSURE
COMPLIANCE WITH FEDERAL AND STATE SECURITIES LAWS AND THE RULES OR OTHER
REQUIREMENTS OF THE NASD OR OTHERWISE TO EFFECTUATE THE OFFERING; AND

 

(III)          SUCH INVESTOR SHALL EXECUTE AND DELIVER AN AGREEMENT TO INDEMNIFY
AND HOLD HARMLESS THE COMPANY AND EACH UNDERWRITER (AS DEFINED IN THE SECURITIES
ACT), AND EACH PERSON OR ENTITY, IF ANY, WHO CONTROLS SUCH UNDERWRITER WITHIN
THE MEANING OF THE SECURITIES ACT, AGAINST SUCH LOSSES, CLAIMS, DAMAGES OR
LIABILITIES (INCLUDING REIMBURSEMENT FOR LEGAL AND OTHER EXPENSES) TO WHICH SUCH
UNDERWRITER OR CONTROLLING PERSON OR ENTITY MAY BECOME SUBJECT UNDER THE
SECURITIES ACT OR OTHERWISE, IN SUCH MANNER AS IS CUSTOMARY FOR REGISTRATIONS OF
THE TYPE THEN PROPOSED AND, IN ANY EVENT, COMPARABLE IN SCOPE TO INDEMNITIES
GIVEN BY THE COMPANY IN CONNECTION WITH SUCH REGISTRATION, BUT ONLY WITH RESPECT
TO INFORMATION FURNISHED BY SUCH INVESTOR IN WRITING AND SPECIFICALLY FOR USE IN
THE REGISTRATION STATEMENT OR PROSPECTUS IN CONNECTION WITH SUCH REGISTRATION
AND WITH RESPECT TO SUCH INVESTOR’S FAILURE TO DELIVER PROSPECTUSES AS REQUIRED
UNDER THE SECURITIES ACT.

 

(G)           INDEMNIFICATION AND CONTRIBUTION.

 

(I)            IN THE EVENT OF ANY REGISTRATION UNDER THE SECURITIES ACT OF ANY
REGISTRABLE STOCK OF INVESTORS PURSUANT TO THIS SECTION 6, THE COMPANY HEREBY
COVENANTS AND AGREES TO INDEMNIFY AND HOLD HARMLESS EACH INVESTOR AND THEIR
RESPECTIVE PARTNERS, DIRECTORS, OFFICERS AND CONTROL PERSONS (WITHIN THE MEANING
OF SECTION 15 OF THE SECURITIES ACT) DISPOSING OF SUCH REGISTRABLE STOCK
(COLLECTIVELY, “INDEMNIFIED PERSONS”) FROM AND AGAINST ANY LOSSES, CLAIMS,
DAMAGES OR LIABILITIES, INCLUDING REIMBURSEMENT FOR LEGAL AND OTHER EXPENSES TO
WHICH SUCH INDEMNIFIED PERSON MAY BECOME SUBJECT UNDER THE SECURITIES ACT, THE
EXCHANGE ACT OR OTHERWISE, INSOFAR AS SUCH LOSSES, CLAIMS, DAMAGES OR
LIABILITIES ARISE OUT OF OR ARE BASED UPON ANY UNTRUE STATEMENT OR ALLEGED
UNTRUE STATEMENT OF A MATERIAL FACT CONTAINED IN A REGISTRATION STATEMENT OR
PROSPECTUS CONTAINED THEREIN (IN THE CASE OF ANY PROSPECTUS OR PRELIMINARY
PROSPECTUS, IN LIGHT OF THE CIRCUMSTANCES UNDER WHICH THEY WERE MADE) OR IN ANY
AMENDMENT OR SUPPLEMENT THERETO OR IN ANY PRELIMINARY PROSPECTUS RELATING TO A
SHELF REGISTRATION, OR ARISE OUT OF, OR ARE BASED UPON, THE OMISSION OR ALLEGED
OMISSION TO STATE THEREIN A MATERIAL FACT REQUIRED TO BE STATED THEREIN OR
NECESSARY TO MAKE THE STATEMENTS THEREIN NOT MISLEADING (IN THE CASE OF ANY
PROSPECTUS OR PRELIMINARY PROSPECTUS, IN LIGHT OF THE CIRCUMSTANCES UNDER WHICH
THEY WERE MADE), AND SHALL REIMBURSE, AS INCURRED, THE INDEMNIFIED PERSONS FOR
ANY LEGAL OR OTHER EXPENSES REASONABLY INCURRED BY THEM IN CONNECTION WITH
INVESTIGATING OR

 

24

--------------------------------------------------------------------------------

 

DEFENDING ANY SUCH LOSS, CLAIM, DAMAGE, LIABILITY OR ACTION IN RESPECT THEREOF;
PROVIDED, HOWEVER, THAT (I) THE COMPANY SHALL NOT BE LIABLE IN ANY SUCH CASE TO
THE EXTENT THAT SUCH LOSS, CLAIM, DAMAGE OR LIABILITY ARISES OUT OF OR IS BASED
UPON ANY UNTRUE STATEMENT OR ALLEGED UNTRUE STATEMENT OR OMISSION OR ALLEGED
OMISSION MADE IN A REGISTRATION STATEMENT OR PROSPECTUS OR IN ANY AMENDMENT OR
SUPPLEMENT THERETO OR IN ANY PRELIMINARY PROSPECTUS RELATING TO A SHELF
REGISTRATION IN RELIANCE UPON AND IN CONFORMITY WITH WRITTEN INFORMATION
PERTAINING TO SUCH INVESTOR AND FURNISHED TO THE COMPANY BY OR ON BEHALF OF SUCH
INVESTOR SPECIFICALLY FOR INCLUSION THEREIN AND (II) WITH RESPECT TO ANY UNTRUE
STATEMENT OR OMISSION OR ALLEGED UNTRUE STATEMENT OR OMISSION MADE IN ANY
PRELIMINARY PROSPECTUS RELATING TO A SHELF REGISTRATION STATEMENT, THE INDEMNITY
AGREEMENT CONTAINED IN THIS SECTION 6(G)(I) SHALL NOT INURE TO THE BENEFIT OF
ANY INVESTOR FROM WHOM THE PERSON ASSERTING ANY SUCH LOSSES, CLAIMS, DAMAGES OR
LIABILITIES PURCHASED THE REGISTRABLE STOCK CONCERNED, TO THE EXTENT THAT A
PROSPECTUS RELATING TO SUCH REGISTRABLE STOCK WAS REQUIRED TO BE DELIVERED BY
SUCH INVESTOR OR UNDERWRITER UNDER THE SECURITIES ACT IN CONNECTION WITH SUCH
PURCHASE AND ANY SUCH LOSS, CLAIM, DAMAGE OR LIABILITY OF SUCH INVESTOR RESULTS
FROM THE FACT THAT THERE WAS NOT SENT OR GIVEN TO SUCH PERSON, AT OR PRIOR TO
THE WRITTEN CONFIRMATION OF THE SALE OF SUCH REGISTRABLE STOCK TO SUCH PERSON, A
COPY OF THE FINAL PROSPECTUS IF THE COMPANY HAD PREVIOUSLY FURNISHED A COPY
THEREOF TO SUCH INVESTOR; PROVIDED, FURTHER, HOWEVER, THAT THIS INDEMNITY
AGREEMENT WILL BE IN ADDITION TO ANY LIABILITY WHICH THE COMPANY MAY OTHERWISE
HAVE TO SUCH INDEMNIFIED PERSON. THE COMPANY SHALL ALSO INDEMNIFY UNDERWRITERS
IN CONNECTION WITH A DISPOSITION OF REGISTRABLE STOCK BY THE INVESTORS, AND SUCH
UNDERWRITERS’ RESPECTIVE DIRECTORS, OFFICERS AND CONTROL PERSONS (WITHIN THE
MEANING OF SECTION 15 OF THE SECURITIES ACT) TO THE SAME EXTENT AS PROVIDED
ABOVE WITH RESPECT TO THE INDEMNIFICATION OF THE SUCH INVESTORS IF REQUESTED BY
A MAJORITY OF SUCH INVESTORS.

 

(II)           IN THE EVENT OF ANY REGISTRATION UNDER THE SECURITIES ACT OF ANY
REGISTRABLE STOCK OF INVESTORS PURSUANT TO THIS SECTION 6, EACH INVESTOR,
SEVERALLY AND NOT JOINTLY, HEREBY COVENANTS AND AGREES TO INDEMNIFY AND HOLD
HARMLESS THE COMPANY AND ITS DIRECTORS, OFFICERS AND CONTROL PERSONS (WITHIN THE
MEANING OF SECTION 15 OF THE SECURITIES ACT) FROM AND AGAINST ANY LOSSES,
CLAIMS, DAMAGES OR LIABILITIES TO WHICH THE COMPANY OR ANY SUCH CONTROLLING
PERSON MAY BECOME SUBJECT UNDER THE SECURITIES ACT, THE EXCHANGE ACT OR
OTHERWISE, INSOFAR AS SUCH LOSSES, CLAIMS, DAMAGES, LIABILITIES OR ACTIONS ARISE
OUT OF OR ARE BASED UPON ANY UNTRUE STATEMENT OR ALLEGED UNTRUE STATEMENT OF A
MATERIAL FACT CONTAINED IN A REGISTRATION STATEMENT OR PROSPECTUS OR IN ANY
AMENDMENT OR SUPPLEMENT THERETO OR IN ANY PRELIMINARY PROSPECTUS RELATING TO A
SHELF REGISTRATION, OR ARISE OUT OF OR ARE BASED UPON THE OMISSION OR ALLEGED
OMISSION TO STATE THEREIN A MATERIAL FACT NECESSARY TO MAKE THE STATEMENTS
THEREIN NOT MISLEADING, BUT IN EACH CASE ONLY TO THE EXTENT THAT THE UNTRUE
STATEMENT OR OMISSION OR ALLEGED UNTRUE STATEMENT OR OMISSION WAS MADE IN
RELIANCE UPON AND IN CONFORMITY WITH WRITTEN INFORMATION PERTAINING TO SUCH
INVESTOR AND FURNISHED TO THE COMPANY BY OR ON BEHALF OF SUCH INVESTOR
SPECIFICALLY FOR INCLUSION THEREIN; AND, SUBJECT TO THE IMMEDIATELY PRECEDING
LIMITATION, SHALL REIMBURSE, AS INCURRED, THE COMPANY FOR ANY LEGAL OR OTHER
EXPENSES REASONABLY INCURRED BY THE COMPANY OR ANY SUCH CONTROLLING PERSON IN
CONNECTION WITH INVESTIGATING OR DEFENDING ANY LOSS, CLAIM, DAMAGE, LIABILITY OR
ACTION IN RESPECT THEREOF.  THIS INDEMNITY AGREEMENT WILL BE IN ADDITION TO ANY
LIABILITY WHICH SUCH HOLDER MAY OTHERWISE HAVE TO THE COMPANY, ITS

 

25

--------------------------------------------------------------------------------

 

DIRECTORS, OFFICERS OR ANY OF ITS CONTROL PERSONS (WITHIN THE MEANING OF
SECTION 15 OF THE SECURITIES ACT).

 

(III)          PROMPTLY AFTER RECEIPT BY AN INDEMNIFIED PARTY UNDER THIS
SECTION 6(G) OF NOTICE OF THE COMMENCEMENT OF ANY ACTION OR PROCEEDING
(INCLUDING A GOVERNMENTAL INVESTIGATION), SUCH INDEMNIFIED PARTY WILL, IF A
CLAIM IN RESPECT THEREOF IS TO BE MADE AGAINST THE INDEMNIFYING PARTY UNDER THIS
SECTION 6(G), NOTIFY THE INDEMNIFYING PARTY OF THE COMMENCEMENT THEREOF;
PROVIDED, THAT THE FAILURE TO NOTIFY THE INDEMNIFYING PARTY SHALL NOT RELIEVE IT
FROM ANY LIABILITY THAT IT MAY HAVE UNDER SUBSECTION (I) OR (II) ABOVE EXCEPT TO
THE EXTENT THAT IT HAS BEEN MATERIALLY PREJUDICED (THROUGH THE FORFEITURE OF
SUBSTANTIVE RIGHTS OR DEFENSES) BY SUCH FAILURE; AND PROVIDED, FURTHER, THAT THE
FAILURE TO NOTIFY THE INDEMNIFYING PARTY SHALL NOT RELIEVE IT FROM ANY LIABILITY
THAT IT MAY HAVE TO AN INDEMNIFIED PARTY OTHERWISE THAN UNDER SUBSECTION (I) OR
(II) ABOVE.  IN CASE ANY SUCH ACTION IS BROUGHT AGAINST ANY INDEMNIFIED PARTY,
AND IT NOTIFIES THE INDEMNIFYING PARTY OF THE COMMENCEMENT THEREOF, THE
INDEMNIFYING PARTY WILL BE ENTITLED TO PARTICIPATE THEREIN AND, TO THE EXTENT
THAT IT MAY WISH, JOINTLY WITH ANY OTHER INDEMNIFYING PARTY SIMILARLY NOTIFIED,
TO ASSUME THE DEFENSE THEREOF, WITH COUNSEL REASONABLY SATISFACTORY TO SUCH
INDEMNIFIED PARTY AND AFTER NOTICE FROM THE INDEMNIFYING PARTY TO SUCH
INDEMNIFIED PARTY OF ITS ELECTION SO TO ASSUME THE DEFENSE THEREOF THE
INDEMNIFYING PARTY WILL NOT BE LIABLE TO SUCH INDEMNIFIED PARTY UNDER THIS
SECTION 6(G) FOR ANY LEGAL OR OTHER EXPENSES, OTHER THAN REASONABLE COSTS OF
INVESTIGATION, SUBSEQUENTLY INCURRED BY SUCH INDEMNIFIED PARTY IN CONNECTION
WITH THE DEFENSE THEREOF.  NO INDEMNIFYING PARTY SHALL, WITHOUT THE PRIOR
WRITTEN CONSENT OF THE INDEMNIFIED PARTY, EFFECT ANY SETTLEMENT OF ANY PENDING
OR THREATENED ACTION 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 (X) INCLUDES AN UNCONDITIONAL RELEASE OF SUCH
INDEMNIFIED PARTY FROM ALL LIABILITY ON ANY CLAIMS THAT ARE THE SUBJECT MATTER
OF SUCH ACTION, AND (Y) DOES NOT INCLUDE A STATEMENT AS TO OR AN ADMISSION OF
FAULT, CULPABILITY OR A FAILURE TO ACT BY OR ON BEHALF OF ANY INDEMNIFIED PARTY.

 

(IV)          THE AGREEMENTS CONTAINED IN THIS SECTION 6(G) SHALL SURVIVE THE
SALE OF THE REGISTRABLE STOCK PURSUANT TO A REGISTRATION STATEMENT AND SHALL
REMAIN IN FULL FORCE AND EFFECT, REGARDLESS OF ANY TERMINATION OR CANCELLATION
OF THIS AGREEMENT OR ANY INVESTIGATION MADE BY OR ON BEHALF OF ANY INDEMNIFIED
PARTY.

 

(V)           IN ORDER TO PROVIDE FOR JUST AND EQUITABLE CONTRIBUTION IN
CIRCUMSTANCES IN WHICH THE INDEMNITY AGREEMENT PROVIDED FOR IN THIS SECTION 6 IS
FOR ANY REASON HELD TO BE UNENFORCEABLE ALTHOUGH APPLICABLE IN ACCORDANCE WITH
ITS TERMS IN RESPECT OF ANY LOSSES, LIABILITIES, CLAIMS, DAMAGES, JUDGMENTS AND
EXPENSES SUFFERED BY AN INDEMNIFIED PARTY REFERRED TO HEREIN, EACH APPLICABLE
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, LIABILITIES, CLAIMS, DAMAGES, JUDGMENTS AND EXPENSES IN SUCH
PROPORTION AS IS APPROPRIATE TO REFLECT THE RELATIVE FAULT OF THE COMPANY ON THE
ONE HAND AND OF THE LIABLE SELLING HOLDERS (INCLUDING, IN EACH CASE, THAT OF
THEIR RESPECTIVE OFFICERS, DIRECTORS, EMPLOYEES AND AGENTS) ON THE OTHER IN
CONNECTION WITH THE STATEMENTS OR OMISSIONS WHICH RESULTED IN SUCH LOSSES,
LIABILITIES, CLAIMS, DAMAGES, JUDGMENTS OR

 

26

--------------------------------------------------------------------------------

 

EXPENSES, AS WELL AS ANY OTHER RELEVANT EQUITABLE CONSIDERATIONS.  THE RELATIVE
FAULT OF THE COMPANY ON THE ONE HAND AND OF THE LIABLE SELLING HOLDERS
(INCLUDING, IN EACH CASE, THAT OF THEIR RESPECTIVE OFFICERS, DIRECTORS,
EMPLOYEES AND AGENTS) 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, ON THE ONE HAND, OR BY OR ON BEHALF OF THE
SELLING HOLDERS, ON THE OTHER, AND THE PARTIES’ RELATIVE INTENT, KNOWLEDGE,
ACCESS TO INFORMATION AND OPPORTUNITY TO CORRECT OR PREVENT SUCH STATEMENT OR
OMISSION.  THE AMOUNT PAID OR PAYABLE BY A PARTY AS A RESULT OF THE LOSSES,
LIABILITIES, CLAIMS, DAMAGES, JUDGMENTS AND EXPENSES REFERRED TO ABOVE SHALL BE
DEEMED TO INCLUDE, SUBJECT TO THE LIMITATIONS SET FORTH IN PARAGRAPH (VI) OF
THIS SECTION 6(G), ANY LEGAL OR OTHER FEES OR EXPENSES REASONABLY INCURRED BY
SUCH PARTY IN CONNECTION WITH INVESTIGATING OR DEFENDING ANY ACTION OR CLAIM.

 

(VI)          THE COMPANY AND EACH HOLDER OF REGISTRABLE STOCK AGREE THAT IT
WOULD NOT BE JUST AND EQUITABLE IF CONTRIBUTION PURSUANT TO THIS PARAGRAPH
(VI) 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
PARAGRAPH (V) ABOVE.  NOTWITHSTANDING THE PROVISIONS OF THIS PARAGRAPH (VI), IN
THE CASE OF DISTRIBUTIONS TO THE PUBLIC, AN INDEMNIFYING HOLDER SHALL NOT BE
REQUIRED TO CONTRIBUTE ANY AMOUNT IN EXCESS OF THE AMOUNT BY WHICH (A) THE TOTAL
PRICE AT WHICH THE REGISTRABLE STOCK SOLD BY SUCH INDEMNIFYING HOLDER AND ITS
AFFILIATED INDEMNIFYING HOLDERS AND DISTRIBUTED TO THE PUBLIC WERE OFFERED TO
THE PUBLIC EXCEEDS (B) THE AMOUNT OF ANY DAMAGES WHICH SUCH INDEMNIFYING HOLDER
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.

 

(H)           RULE 144. THE COMPANY COVENANTS THAT IT WILL USE COMMERCIALLY
REASONABLE EFFORTS TO 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 COMMISSION THEREUNDER. UPON THE REQUEST OF ANY INVESTOR, THE COMPANY WILL
DELIVER TO SUCH INVESTOR A WRITTEN STATEMENT AS TO WHETHER IT HAS COMPLIED WITH
SUCH REQUIREMENTS.

 

(i)            Termination of Registration Rights.  Each Investor’s entitlement
to registration rights pursuant to this Section 6 shall expire as to any share
of Stock upon (A) such share of Stock ceasing to be subject to this Agreement,
(B) the sale of such share of Stock pursuant to an effective registration
statement, (C) the sale of such share of Stock pursuant to Rule 144, or (D) the
date upon which such share of Stock has been Transferred and, in connection
therewith, an unlegended stock certificate for such share has been issued and
the sale of such share of Stock has been permitted absent registration under the
Securities Act.

 

(j)            Delay of Registration.  Notwithstanding Section 13(c), no
Investor shall have any right to obtain or seek an injunction restraining or
otherwise delaying any such registration as the result of any controversy that
might arise with respect to the interpretation or implementation of this
Section 6.

 

27

--------------------------------------------------------------------------------

 

SECTION 7.         LEGEND ON CERTIFICATES

 

(a)           Legends.  To the extent applicable, each certificate representing
Stock shall bear each of the following legends until such time as the Stock
represented thereby are no longer subject to the provisions hereof or at such
time as Rule 144 or any similar exemption under the Securities Act is available
for the sale of all such Investor’s shares during a three-month period without
registration, without reference to Rule 144(k) under the Securities Act:

 

(I)            “THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN ACQUIRED FOR
INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR
DISTRIBUTION THEREOF.  NO SUCH SALE OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN
EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF COUNSEL IN A
FORM SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER
THE SECURITIES ACT OF 1933.”

 

(II)           “THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE
TRANSFERRED, SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF OR
EXCHANGED UNLESS SUCH TRANSFER, SALE, ASSIGNMENT, PLEDGE, HYPOTHECATION OR OTHER
DISPOSITION OR EXCHANGE COMPLIES WITH THE PROVISIONS OF THE SECOND AMENDED AND
RESTATED STOCKHOLDERS AGREEMENT, DATED AS OF JANUARY 26, 2006, AS AMENDED FROM
TIME TO TIME, AMONG THE COMPANY AND THE STOCKHOLDERS PARTY THERETO, A COPY OF
WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY.”

 

(III)          ANY LEGEND REQUIRED BY THE BLUE SKY LAWS OF ANY STATE TO THE
EXTENT SUCH LAWS ARE APPLICABLE TO THE SHARES REPRESENTED BY THE CERTIFICATE SO
LEGENDED.

 

SECTION 8.         DURATION OF AGREEMENT

 

This Agreement shall terminate and be of no further force or effect, except with
respect to the provisions set forth in Sections 12 and 13, upon the earlier to
occur of (i) the unanimous agreement of the Principal Investors and (ii) the
date on which the JPMP Investors and the Apollo Investors no longer satisfy the
conditions necessary to designate at least one Class A-1 Director (as defined in
the Company Charter) and the Carlyle Investors, the Bain Investors and the
Spectrum Investors no longer satisfy the conditions necessary to designate at
least one Class L-1 Director (as defined in the Company Charter) to the Company
Board, in each case, pursuant to the Company Charter as in effect at the
Effective Time.  Notwithstanding the foregoing and except as may be otherwise
specified herein, in the event that this Agreement is terminated pursuant to
clause (ii) of the preceding sentence, the provisions set forth in Sections 6,
7, 8, 11, 12 and 13 shall survive.

 

28

--------------------------------------------------------------------------------

 

SECTION 9.         INFORMATION RIGHTS

 

(A)           FINANCIAL STATEMENTS AND OTHER INFORMATION.

 

(I)            THE COMPANY SHALL DELIVER TO EACH INVESTOR:

 

(A)          AS SOON AS IS AVAILABLE AND IN ANY EVENT WITHIN THIRTY (30) DAYS
AFTER THE END OF EACH MONTH OF EACH FISCAL YEAR OF THE COMPANY, CONSOLIDATED
BALANCE SHEETS OF THE COMPANY AND ANY SUBSIDIARY OF THE COMPANY AS OF THE END OF
SUCH PERIOD, AND CONSOLIDATED STATEMENTS OF INCOME AND CASH FLOWS OF THE COMPANY
AND ANY SUBSIDIARY OF THE COMPANY FOR THE PERIOD THEN ENDED, PREPARED IN
CONFORMITY WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES IN THE UNITED STATES
APPLIED ON A CONSISTENT BASIS, EXCEPT AS OTHERWISE NOTED THEREIN, AND SUBJECT TO
THE ABSENCE OF FOOTNOTES AND TO YEAR-END ADJUSTMENTS;

 

(B)           AS SOON AS IS AVAILABLE AND IN ANY EVENT WITHIN FORTY-FIVE (45)
DAYS AFTER THE END OF EACH OF THE FIRST THREE QUARTERS OF EACH FISCAL YEAR OF
THE COMPANY, CONSOLIDATED BALANCE SHEETS OF THE COMPANY AND ANY SUBSIDIARY OF
THE COMPANY AS OF THE END OF SUCH PERIOD, AND CONSOLIDATED STATEMENTS OF INCOME
AND CASH FLOWS OF THE COMPANY AND ANY SUBSIDIARY OF THE COMPANY FOR THE PERIOD
THEN ENDED, PREPARED IN CONFORMITY WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES
IN THE UNITED STATES APPLIED ON A CONSISTENT BASIS, EXCEPT AS OTHERWISE NOTED
THEREIN, AND SUBJECT TO THE ABSENCE OF FOOTNOTES AND TO YEAR-END ADJUSTMENTS;

 

(C)           AS SOON AS IS AVAILABLE AND IN ANY EVENT WITHIN NINETY (90 )DAYS
AFTER THE END OF EACH FISCAL YEAR OF THE COMPANY, A CONSOLIDATED BALANCE SHEET
OF THE COMPANY AND ANY SUBSIDIARIES OF THE COMPANY AS OF THE END OF SUCH YEAR,
AND CONSOLIDATED STATEMENTS OF INCOME AND CASH FLOWS OF THE COMPANY AND ANY
SUBSIDIARY OF THE COMPANY FOR THE YEAR ENDED PREPARED IN CONFORMITY WITH
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES IN THE UNITED STATES APPLIED ON A
CONSISTENT BASIS, EXCEPT AS OTHERWISE NOTED THEREIN, TOGETHER WITH AN AUDITOR’S
REPORT THEREON OF A FIRM OF ESTABLISHED NATIONAL REPUTATION; AND

 

(D)          TO THE EXTENT THE COMPANY IS REQUIRED BY LAW OR PURSUANT TO THE
TERMS OF ANY OUTSTANDING INDEBTEDNESS OF THE COMPANY TO PREPARE SUCH REPORTS,
ANY ANNUAL REPORTS, QUARTERLY REPORTS AND OTHER PERIODIC REPORTS PURSUANT TO
SECTION 13 OR 15(D) OF THE EXCHANGE ACT, AS AMENDED, ACTUALLY PREPARED BY THE
COMPANY AS SOON AS AVAILABLE.

 

(II)           THE COMPANY SHALL INFORM EACH PRINCIPAL INVESTOR IN ADVANCE WITH
RESPECT TO ANY SIGNIFICANT CORPORATE ACTIONS, INCLUDING EXTRAORDINARY DIVIDENDS
OR DISTRIBUTIONS, MERGERS, ACQUISITIONS OR DISPOSITIONS OF ASSETS, ISSUANCES OF
SIGNIFICANT AMOUNTS OF DEBT OR EQUITY AND MATERIAL AMENDMENTS TO ITS CERTIFICATE
OF INCORPORATION OR BYLAWS.

 

(III)          FROM AND AFTER THE DATE HEREOF, THE INVESTORS SHALL NOT AND, IN
EACH CASE, SHALL CAUSE EACH OF THEIR RESPECTIVE PERMITTED TRANSFEREES AND OTHER
REPRESENTATIVES NOT TO, DIRECTLY OR INDIRECTLY, DISCLOSE, REVEAL, DIVULGE OR
COMMUNICATE TO ANY PERSON OTHER

 

29

--------------------------------------------------------------------------------

 

THAN AUTHORIZED REPRESENTATIVES OF THE COMPANY OR USE OR OTHERWISE EXPLOIT FOR
ITS OWN BENEFIT OR FOR THE BENEFIT OF ANYONE OTHER THAN THE COMPANY, ANY
CONFIDENTIAL INFORMATION OBTAINED PURSUANT TO THIS SECTION 9 OF OR RELATING TO
THE BUSINESS CONDUCTED BY THE COMPANY, UNLESS (I) COMPELLED TO DISCLOSE BY
JUDICIAL OR ADMINISTRATIVE PROCESS OR BY OTHER REQUIREMENTS OF LAW OR
GOVERNMENTAL AUTHORITIES OR (II) DISCLOSED IN AN ACTION BROUGHT BY A PARTY
HERETO IN PURSUIT OF ITS RIGHTS OR IN THE EXERCISE OF ITS REMEDIES HEREUNDER;
PROVIDED, HOWEVER, THAT IN THE EVENT DISCLOSURE IS REQUIRED BY APPLICABLE LAW,
THE INVESTORS SHALL, TO THE EXTENT REASONABLY POSSIBLE, PROVIDE THE COMPANY WITH
PROMPT NOTICE OF SUCH REQUIREMENT PRIOR TO MAKING ANY DISCLOSURE SO THAT THE
COMPANY MAY SEEK AN APPROPRIATE PROTECTIVE ORDER.  FOR PURPOSES OF THIS
SECTION 9(A)(III), “CONFIDENTIAL INFORMATION” DOES NOT INCLUDE, AND THERE SHALL
BE NO OBLIGATION HEREUNDER WITH RESPECT TO, INFORMATION THAT (I) IS GENERALLY
AVAILABLE TO THE PUBLIC ON THE DATE OF THIS AGREEMENT OR (II) BECOMES GENERALLY
AVAILABLE TO THE PUBLIC OTHER THAN AS A RESULT OF A DISCLOSURE NOT OTHERWISE
PERMISSIBLE THEREUNDER.

 

(b)           Other Information.  The Company and any Subsidiary of the Company
shall provide to each Principal Investor, and as applicable create and/or
generate, any information as a Principal Investor may reasonably request,
including true and correct copies of all documents, reports, financial data and
other information.

 

SECTION 10.       REGULATORY MATTERS

 

(a)           Cooperation of Other Stockholders.  Each Investor agrees to
cooperate with the Company in all reasonable respects in complying with the
terms and provisions of the letter agreement between the Company and the JPMP
Investors, a copy of which is attached hereto as Exhibit B, regarding regulatory
matters (the “Second Amended and Restated Regulatory Sideletter”), including
voting to approve amending the Company Charter, the Company’s bylaws or this
Agreement in a manner reasonably acceptable to the Parties and the JPMP
Investors entitled to make such request pursuant to the Second Amended and
Restated Regulatory Sideletter in order to remedy a Regulatory Problem (as
defined in the Second Amended and Restated Regulatory Sideletter).

 

(b)           Covenant Not to Amend.  The Company and each Party agrees not to
amend or waive the voting or other provisions of the Company Charter, the
Company’s bylaws, this Agreement or any Agreement listed on
Schedule 10(b) hereto if such amendment or waiver would cause the JPMP Investors
to have a Regulatory Problem.  The JPMP Investors agree to notify the Company as
to whether or not it would have a Regulatory Problem promptly after the JPMP
Investors have notice of such amendment or waiver.

 

(c)           Exception.  Anything contained in this Section 10 to the contrary
notwithstanding, no Investor shall be required under this Section 10 to take any
action or abstain from taking any action that would adversely affect such
Investor’s investment in the Company or reasonable expectations related to the
transactions contemplated by such investment.

 

30

--------------------------------------------------------------------------------

 

SECTION 11.       EFFECTIVENESS OF AGREEMENT

 

This Agreement shall become effective at the Effective Time.  Prior to the
Effective Time, this Agreement shall have no force or effect, and no Investor
shall have any rights, obligations or claims against or with respect to the
Company or any other Investor pursuant to this Agreement (it being understood
and agreed that prior to the Effective Time the Initial Stockholders Agreement
shall remain in full force and effect).

 

SECTION 12.       DEFINITIONS

 

(a)           As used in this Agreement, the following terms have the following
meanings:

 

“3% Owner” has the meaning set forth in the definition of Independent Third
Party below.

 

“Additional Remaining Offered Shares” has the meaning set forth in Section 2(c).

 

“Affiliate” means with respect to a specified Person, any Person that directly
or indirectly controls, is controlled by, or is under common control with, the
specified Person.  As used in this definition, the term “control” means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through ownership
of voting securities, by contract or otherwise.  Notwithstanding the foregoing,
CSFB Strategic Partners Holdings II, L.P., on the one hand, and CSFB Credit
Opportunities Fund (Employee), L.P. and CSFB Credit Opportunities Fund (Helios),
L.P., on the other hand, shall not be deemed to be Affiliates of each other.

 

“Affiliated Fund” means, with respect to any specified Person, an investment
fund that is an Affiliate of such Person (including entities investing solely on
behalf of the Investor or such fund) or an entity that is directly or indirectly
wholly-owned by such Investor or one or more of such funds (other than a
portfolio company of any such fund).

 

“Agreement” has the meaning set forth in the preamble.

 

“AMC” means AMC Entertainment Inc., a Delaware corporation.

 

“Amended Drag-Along Notice” has the meaning set forth in Section 3(b).

 

“Amended Participation Notice” had the meaning set forth in Section 5(c).

 

“Apollo Fund V” has the meaning set forth in the preamble.

 

“Apollo German Partners” has the meaning set forth in the preamble.

 

“Apollo Investors” has the meaning set forth in the preamble.

 

“Apollo Netherlands V(A)” has the meaning set forth in the preamble.

 

“Apollo Netherlands V(B)” has the meaning set forth in the preamble.

 

31

--------------------------------------------------------------------------------

 

“Apollo Overseas” has the meaning set forth in the preamble.

 

“Approving Principal Investor Parties” has the meaning set forth in the
definition of Requisite Stockholder Majority below.

 

“Bain Investors” has the meaning set forth in the preamble.

 

“Blockout Period” means the period from the Effective Time until the fifth
anniversary of the Effective Time.

 

“Board” means the board of directors of the Company.

 

“Business Day” means any day that is not a Saturday, a Sunday or other day on
which banks are required or authorized by law to be closed in New York, New
York.

 

“Carlyle Investors” has the meaning set forth in the preamble.

 

“Charitable Organization” means a charitable organization as described by
Section 501(c)(3) or any successor provision of the Internal Revenue Code of
1986, as in effect from time to time.

 

“Class A Common Stock” has the meaning set forth in the recitals.

 

“Class L Common Stock” has the meaning set forth in the recitals.

 

“Class N Common Stock” has the meaning set forth in the recitals.

 

“Coinvestor Demand” has the meaning set forth in Section 6(a)(ii).

 

“Commission” has the meaning set forth in Section 6(a)(i).

 

“Common Stock” means the Class A Common Stock, the Class L Common Stock, the
Class N Common Stock, the residual common stock, par value $0.01 per share, of
the Company and any other class or series of common stock of the Company.

 

“Company” has the meaning set forth in the preamble.

 

“Company Charter” means the amended and restated certificate of incorporation of
the Company as in effect as of the Effective Time.

 

“Company Election Notice” has the meaning set forth in Section 2(a).

 

“Company Election Period” has the meaning set forth in Section 2(a).

 

“Company Sale” means any one of the following:  (i) a change in the ownership or
control of the Company or AMC effected through a transaction or series of
transactions (including by way of merger, consolidation, business combination or
similar transaction involving the Company or any of its Subsidiaries) whereby
any “person” or related “group” of “persons” (as

 

32

--------------------------------------------------------------------------------

 

such terms are used in Sections 13(d) and 14(d)(2) of the Exchange Act) (other
than the Company, any of its Subsidiaries, an employee benefit plan maintained
by the Company or any of its Subsidiaries, or a “person” that, prior to such
transaction, directly or indirectly controls, is controlled by, or is under
common control with, the Company) directly or indirectly acquires beneficial
ownership (within the meaning of Rule 13d-3 under the Exchange Act), of more
than fifty percent (50%) of the Stock then outstanding, or of securities of the
Company or AMC (or options, rights or warrants to purchase or securities
convertible into or exchangeable for such securities) possessing more than fifty
percent (50%) of the total combined voting power of the Company’s or AMC’s
securities outstanding, in either case immediately after such transaction or
series of transactions; or (ii) the sale, lease, transfer, conveyance or other
disposition (other than by way of a transaction that would not be deemed a
Company Sale pursuant to clause (i) above), in one or a series of related
transactions, of all or substantially all of the assets of the Company or AMC,
or the Company and its Subsidiaries taken as a whole, to any “person” (as
defined above).

 

“Competitive Opportunity” has the meaning set forth in Section 13(b).

 

“Convertible Securities” means any evidence of indebtedness, shares of stock or
other securities (other than Options or Warrants) which are directly or
indirectly convertible into or exchangeable or exercisable for shares of Stock.

 

“Demand Notice” has the meaning set forth in Section 6(a)(i)

 

“Demand Registration” has the meaning set forth in Section 6(a)(i)

 

“Demanding Investor” has the meaning set forth in Section 6(a)(i)

 

“Drag-Along Notice” has the meaning set forth in Section 3(b).

 

“Drag-Along Sellers” has the meaning set forth in Section 3(a).

 

“Drag-Along Transferee” has the meaning set forth in Section 3(a).

 

“Effective Time” has the meaning set forth in the Merger Agreement.

 

“Electing Party” has the meaning set forth in Section 2(e).

 

“Eligible Shares” has the meaning set forth in Section 4(b).

 

“Equivalent Shares” means, at any date of determination, (a) as to any
outstanding shares of Stock, such number of shares of Stock, (b) as to any
outstanding Options, Warrants or Convertible Securities, the maximum number of
shares of Stock for which or into which such Options, Warrants or Convertible
Securities may at the time be exercised, converted or exchanged (or which will
become exercisable, convertible or exchangeable on or prior to, or by reason of,
the transaction or circumstances in connection with which the number of
Equivalent Shares is to be determined) and (c) in respect of any Subsidiary of
the Company, (i) as to any outstanding shares of stock of any Subsidiary of the
Company, such number of shares of stock or (ii) as to any outstanding options,
warrants or convertible securities, the maximum number of shares of stock of any
Subsidiary of the Company for which or into which such options, warrants or
convertible

 

33

--------------------------------------------------------------------------------

 

securities may at the time be exercised, converted or exchanged (or which will
become exercisable, convertible or exchangeable on or prior to, or by reason of,
the transaction or circumstances in connection with which the number of
Equivalent Shares is to be determined).

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended, and the
rules and regulations in effect thereunder.

 

“Exit Sale” has the meaning set forth in Section 3(a).

 

“Fair Market Value” with respect to any non-cash consideration shall be
determined as follows:

 

(I)            IF SUCH NON-CASH CONSIDERATION IS A SECURITY AND IS LISTED ON ONE
OR MORE NATIONAL SECURITIES EXCHANGES (WITHIN THE MEANING OF THE EXCHANGE ACT),
THE FAIR MARKET VALUE SHALL BE THE AVERAGE CLOSING PRICE OF SUCH SECURITY FOR
THE TWENTY (20) MOST RECENT TRADING DAYS PRIOR TO THE DELIVERY OF THE TRANSFER
NOTICE ON THE PRINCIPAL EXCHANGE ON WHICH SUCH SECURITY IS THEN TRADING;

 

(II)           IF SUCH NON-CASH CONSIDERATION IS A SECURITY AND IS NOT TRADED ON
A NATIONAL SECURITIES EXCHANGE BUT IS QUOTED ON NASDAQ OR A SUCCESSOR QUOTATION
SYSTEM, THE FAIR MARKET VALUE SHALL BE THE AVERAGE LAST SALES PRICE FOR THE
TWENTY (20) MOST RECENT TRADING DAYS PRIOR TO THE DELIVERY OF THE TRANSFER
NOTICE AS REPORTED BY NASDAQ OR SUCH SUCCESSOR QUOTATION SYSTEM; OR

 

(III)          IF SUCH NON-CASH CONSIDERATION IS A SECURITY AND IS NOT PUBLICLY
TRADED ON A NATIONAL SECURITIES EXCHANGE AND IS NOT QUOTED ON NASDAQ OR A
SUCCESSOR QUOTATION SYSTEM, OR IF SUCH NON-CASH CONSIDERATION IS NOT A SECURITY,
THE FAIR MARKET VALUE SHALL BE DETERMINED IN GOOD FAITH BY THE BOARD.

 

“Former LCE Investors” has the meaning set forth in the preamble.

 

“Fully Subscribed Non-Selling Investor” has the meaning set forth in
Section 2(c).

 

“Ginger” has the meaning set forth in the preamble.

 

“Governmental Approval” means, with respect to any Transfer of Shares, any
consent or other action by, or filing with, any governmental authority required
in connection with such Transfer and the expiration or early termination of any
applicable statutory waiting period in connection with such action or filing.

 

“Independent Third Party” means any Person who, immediately prior to the
contemplated transaction, (i) does not own, either directly or through one or
more intermediaries, in excess of 3% of the Shares (any Person owning in excess
of 3% of the Shares being referred to herein as a “3% Owner”) and (ii) is not an
Affiliate of any such 3% Owner.

 

“Initial Investor Shares” means that number of Shares held by an Investor
immediately following the Effective Time, as the same may be adjusted for stock
splits, stock dividends, recapitalizations, pro-rata sell-downs or similar
events.

 

34

--------------------------------------------------------------------------------

 

“Initial Public Offering” means the initial public offering of Stock registered
on Form S-1 (or any equivalent or successor form under the Securities Act).

 

“Initial Stockholders Agreement” has the meaning set forth in the preamble.

 

“Investor” or “Investors” means each of the JPMP Investors, the Apollo
Investors, the Other Marquee Investors, the Carlyle Investors, the Bain
Investors, the Spectrum Investors and any other subsequent holder of Shares who
becomes an Investor bound by the terms of this Agreement in accordance with the
terms of this Agreement.

 

“Investor Election Notice” has the meaning set forth in Section 2(b).

 

“Investor Election Period” has the meaning set forth in Section 2(b).

 

“IPO Date” means the date on which the Company consummates its Initial Public
Offering.

 

“Issuance” has the meaning set forth in Section 5(a).

 

“Issuer” has the meaning set forth in Section 5(a).

 

“JPMP BHCA” has the meaning set forth in the preamble.

 

“JPMP Cayman” has the meaning set forth in the preamble.

 

“JPMP Cayman II” has the meaning set forth in the preamble.

 

“JPMP Global” has the meaning set forth in the preamble.

 

“JPMP Investors” has the meaning set forth in the preamble.

 

“JPMP Selldown” has the meaning set forth in the preamble.

 

“LCE Holdings” has the meaning set forth in the recitals.

 

“Litigation” has the meaning set forth in Section 13(e).

 

“Luke” has the meaning set forth in the preamble.

 

“Management Stockholder” has the meaning set forth in the recitals.

 

“Management Stockholders Agreement” has the meaning set forth in the recitals.

 

“Merger” has the meaning set forth in the recitals.

 

“Merger Agreement” has the meaning set forth in the recitals.

 

“Non-Selling Investor” has the meaning set forth in Section 2(b).

 

35

--------------------------------------------------------------------------------

 

“Offered Shares” has the meaning set forth in Section 1(b).

 

“Offeror” has the meaning set forth in Section 2(a).

 

“Opposing Principal Investor Parties” has the meaning set forth in the
definition of Requisite Stockholder Majority below.

 

“Options” means any options to subscribe for, purchase or otherwise directly
acquire Stock, other than any such option held by the Company or any right to
purchase shares pursuant to this Agreement.

 

“Other Marquee Investors” has the meaning set forth in the preamble.

 

“Other Securities” has the meaning set forth in Section 5(f).

 

“Participating Buyer” has the meaning set forth in Section 5(c).

 

“Participating Offerees” has the meaning set forth in Section 5(b).

 

 “Participation Notice” has the meaning set forth in Section 5(b).

 

“Participation Portion” has the meaning set forth in Section 5(b)(i).

 

“Party” and “Parties” has the meaning set forth in the preamble.

 

“Percentage Interest” means the number of shares of Stock owned by an Investor,
divided by the aggregate outstanding shares of Stock of the Company owned by the
Investors, expressed as a percentage.

 

“Permitted Transfer” means:  (i) a Transfer approved by the Requisite
Stockholder Majority, (ii) a Transfer to an Affiliated Fund of such Investor;
provided such transferee remains at all times an Affiliated Fund of such
transferor following the Transfer; (iii) following an Initial Public Offering, a
Transfer by an Investor made as part of a distribution by an Investor to its
respective general or limited partners or members in accordance with such
Investor’s fund documents, as the case may be; (iv) in connection with or after
an Initial Public Offering, a Transfer by any Investor to one or more Charitable
Organizations that, in the aggregate when taken together with any and all such
Transfers to one or more Charitable Organizations, shall not exceed 20% of the
Initial Investor Shares held by such Investor; (v) a Transfer made by a JPMP
Investor pursuant to and in accordance with the Amended and Restated Regulatory
Sideletter; or (vi) a Transfer made pursuant to the registration rights as set
forth in Section 6; provided that such transferee, in the case of clauses (i),
(ii) and (v) above shall agree in writing with the Parties to be bound by, and
to comply with, all applicable provisions of and to be deemed to be an Investor
for purposes of this Agreement; provided, further, that such transferee in the
case of clause (iv) above shall agree in writing with the parties to be bound
by, and to comply with this Agreement other than Sections 5 and 9.  For the
avoidance of doubt, (A) any Permitted Transfer made pursuant to clause (i) of
this definition is subject to the provisions of Section 4, and (B) a transferee
of Shares subsequent to the IPO Date may, but shall not be required to (unless
otherwise provided above),

 

36

--------------------------------------------------------------------------------

 

agree in writing with the Parties to be bound by, and to comply with, all
applicable provisions of and to be deemed to be an Investor for purposes of this
Agreement.

 

“Permitted Transferee” means any Person who acquires Shares pursuant to clauses
(i) and (ii) of the definition of Permitted Transfer.

 

 “Person” includes any individual, corporation, association, partnership
(general or limited), joint venture, trust, estate, limited liability company,
or other legal entity or organization.

 

“Pre-Existing Marquee Investors” has the meaning set forth in the preamble.

 

“Principal Investor” means any one of (i) the JPMP Investors, collectively,
(ii) the Apollo Investors, collectively, (iii) the Carlyle Investors,
collectively, and (iv) the Bain Investors, collectively; provided, however, that
any such Principal Investor shall cease to be a Principal Investor at such time
as such Principal Investor ceases to hold Shares representing at least 25% of
the Initial Investor Shares held by such Principal Investor (in each case, as
may be adjusted for stock splits, stock dividends, recapitalizations, pro-rata
selldowns or similar events).  For the avoidance of doubt, so long as there are
two or more Principal Investors, references in this Agreement to “Principal
Investors” shall mean all Principal Investors then remaining, and if at any time
there is only one Principal Investor, references in this Agreement to “the
Principal Investors” or “each Principal Investor” shall mean that sole Principal
Investor then remaining.

 

“Prospective Subscriber” has the meaning set forth in Section 5(b)(i).

 

“Prospectus” has the meaning set forth in Section 6(e)(i).

 

“Public Sale” means a Transfer pursuant to (i) a bona fide underwritten public
offering pursuant to an effective registration statement filed under the
Securities Act or (ii) Rule 144 (other than in a privately negotiated sale).

 

“Registrable Stock” means with respect to any Investor, all Stock held by such
Investor, including any Stock received, directly or indirectly, with respect to
or in exchange of, or substitution for or conversion of such Stock, including by
way of dividend or distribution, recapitalization, merger, consolidation or
other reorganization, other than Stock (i) sold by an Investor in a transaction
in which such Investor’s rights under this Agreement are not assigned, (ii) sold
pursuant to an effective registration statement under the Securities Act or
(iii) sold in a transaction exempt from the registration and prospectus delivery
requirements of the Securities Act (including transactions under Rule 144) so
that all transfer restrictions and restrictive legends with respect thereto, if
any, are removed upon the consummation of such sale.

 

“Registration Statement” has the meaning set forth in Section 6(e).

 

“Regulatory Problem” has the meaning set forth in the Amended and Restated
Regulatory Side letter.

 

“Related Holder” has the meaning set forth in the definition of Specified Holder
below.

 

“Remaining Offered Shares” has the meaning set forth in Section 2(c).

 

37

--------------------------------------------------------------------------------

 

“Required Sellers” has the meaning set forth in Section 3(a).

 

“Requisite Stockholder Majority” means, at the time of approval or consent:
(a) the consent of three of the Principal Investors so long as there are four
Principal Investors, provided, however, if two of the Principal Investors (the
“Approving Principal Investor Parties”) consent to the exercise of any right or
the taking of any action but the other two Principal Investors (the “Opposing
Principal Investor Parties”) do not consent to the exercise of such right or the
taking of such action and (i) a Pre-Existing Marquee Investor is an Approving
Principal Investor Party and another Pre-Existing Marquee Investor is an
Opposing Principal Investor Party, (ii) a Former LCE Investor is an Approving
Principal Investor Party and another Former LCE Investor is an Opposing
Principal Investor Party, and (iii) the Spectrum Investors hold Shares
representing at least 25% of the Initial Investor Shares held by the Spectrum
Investors, then the “Requisite Stockholder Majority” shall mean the consent of
the Approving Principal Investor Parties plus the consent of the Spectrum
Investors; (b) the consent of two of the Principal Investors, so long as there
are two or three Principal Investors; (c) the consent of one Principal Investor,
so long as there is only one Principal Investor; or (d) the consent of holders
of a majority of the issued and outstanding shares of Class A Common Stock and
Class L Common Stock, voting together as a single class, so long as there is no
Principal Investor.  For the avoidance of doubt, for purposes of determining the
Requisite Stockholder Majority, the taking of any action or the exercise of any
right (including the granting of any consent or approval) by any Principal
Investor or by the Spectrum Investors shall be determined by the holders of a
majority of the Shares held by such Principal Investor or the Spectrum Investors
(as applicable).

 

“ROFO” has the meaning set forth in Section 2(i).

 

“Rule 144” means Rule 144, or any successor thereto, promulgated under the
Securities Act.

 

“Scarlett” has the meaning set forth in the preamble.

 

“Second Amended and Restated Regulatory Sideletter” has the meaning set forth in
Section 10(a).

 

“Second Investor Election Notice” has the meaning set forth in Section 2(c).

 

“Second Investor Election Period” has the meaning set forth in Section 2(c).

 

“Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations in effect thereunder.

 

“Selling Investor” has the meaning set forth in Sections 2(a).

 

“Shares” means (a) all shares of Stock, whenever issued, including all shares of
Stock issued upon the exercise, conversion or exchange of any Options, Warrants
or Convertible Securities and (b) all Options, Warrants and Convertible
Securities (treating such Options, Warrants and Convertible Securities as a
number of Shares equal to the number of Equivalent

 

38

--------------------------------------------------------------------------------

 

Shares represented by such Options, Warrants and Convertible Securities for all
purposes of this Agreement except as otherwise specifically set forth herein).

 

“Shelf Registration” shall mean a registration which covers the Registrable
Stock requested to be included therein pursuant to the provisions of
Section 6(a)(i) on an appropriate form or any similar successor or replacement
form pursuant to Rule 415 of the Securities Act, and which form shall be
available for the sale of the Registrable Stock in accordance with the intended
method or methods of distribution thereof, and all amendments and supplements to
such registration statement, including post-effective amendments, in each case
including the prospectus contained therein, all exhibits thereto and all
material incorporated by reference therein.

 

“Specified Holder” means an Investor whose sale of Shares pursuant to Rule 144
would be subject to aggregation with another Investor (such other Investor being
a “Related Holder”).

 

“Spectrum Investors” has the meaning set forth in the recitals.

 

“Stock” means Common Stock, together with any other classes or series of equity
securities of the Company.

 

“Subject Securities” has the meaning set forth in Section 5(a).

 

“Subsidiary” or “Subsidiaries” of any Person means any corporation, partnership,
joint venture or other legal entity of which such Person (either alone or
through or together with any other Person), owns, directly or indirectly, 50% or
more of the stock or other equity interests which are generally entitled to vote
for the election of the board of directors or other governing body of such
corporation or other legal entity.

 

“Successor Entity” has the meaning set forth in Section 13(k).

 

“Tag-Along Election Period” has the meaning set forth in Section 4(b).

 

“Tag-Along Rights” has the meaning set forth in Section 4(b).

 

“Tag-Along Seller” has the meaning set forth in Section 4(a).

 

“Tag-Along Transferee” has the meaning set forth in Section 4(b).

 

“Transfer” means a transfer, sale, assignment, pledge, hypothecation or other
disposition or exchange, including any Transfer of a voting or economic interest
in securities or other property; and “Transferring” or “Transferred” have
correlative meanings.

 

“Transfer Notice” has the meaning set forth in Section 1(b).

 

“Warrants” means any warrants to subscribe for, purchase or otherwise directly
acquire Stock or Convertible Securities.

 

(b)           Unless the context of this Agreement otherwise requires, (i) words
of any gender include each other gender; (ii) words using the singular or plural
number also include the plural

 

39

--------------------------------------------------------------------------------

 

or singular number, respectively; (iii) the terms “hereof,” “herein,” “hereby”
and derivative or similar words refer to this entire Agreement; (iv) the terms
“Article” or “Section” refer to the specified Article or Section of this
Agreement; (v) the word “including” shall mean “including, without limitation”,
(vi) each defined term has its defined meaning throughout this Agreement,
whether the definition of such term appears before or after such term is used,
and (vii) the word “or” shall be disjunctive but not exclusive.

 

(c)           References to agreements and other documents shall be deemed to
include all subsequent amendments and other modifications thereto.

 

(d)           References to statutes shall include all regulations promulgated
thereunder and references to statutes or regulations shall be construed as
including all statutory and regulatory provisions consolidating, amending or
replacing the statute or regulation.

 

SECTION 13.       MISCELLANEOUS

 

(A)           SUCCESSORS, ASSIGNS AND TRANSFEREES. NEITHER THIS AGREEMENT NOR
ANY OF THE RIGHTS, INTERESTS OR OBLIGATIONS HEREUNDER SHALL BE ASSIGNED BY ANY
PARTY, IN WHOLE OR IN PART, (WHETHER BY OPERATION OF LAW, STOCK SALE, MERGER,
CONSOLIDATION OR OTHERWISE), WITHOUT THE PRIOR WRITTEN CONSENT OF THE PARTIES,
AND ANY ATTEMPT TO MAKE SUCH ASSIGNMENT WITHOUT SUCH WRITTEN CONSENT SHALL BE
NULL AND VOID.  NOTWITHSTANDING THE FOREGOING, A PARTY MAY ASSIGN ITS RIGHTS,
INTERESTS AND OBLIGATIONS HEREUNDER TO A TRANSFEREE OF SHARES HEREUNDER WITHOUT
OBTAINING THE PRIOR WRITTEN CONSENT OF THE PARTIES SOLELY IN CONNECTION WITH
TRANSFERS OF SHARES MADE IN COMPLIANCE WITH THE PROVISIONS OF THIS AGREEMENT. 
THIS AGREEMENT SHALL BE BINDING UPON AND INURE TO THE BENEFIT OF THE PARTIES AND
THEIR RESPECTIVE LEGAL REPRESENTATIVES, HEIRS, LEGATEES, SUCCESSORS, AND
PERMITTED ASSIGNS AND ANY OTHER PERMITTED TRANSFEREE OF SHARES HEREUNDER AND
SHALL ALSO APPLY TO ANY SHARES ACQUIRED BY INVESTORS AFTER THE DATE HEREOF.

 

(b)           Competitive Opportunity.  If any Investor or any of its Affiliates
acquires knowledge of a potential transaction or matter which may be an
investment or business opportunity or prospective economic or competitive
advantage in which the Company could have an interest or expectancy, in each
case, in a jurisdiction other than in the United States of America (a
“Competitive Opportunity”) or otherwise is then exploiting any Competitive
Opportunity, the Company shall have no interest in, and no expectation that,
such Competitive Opportunity be offered to it, any such interest or expectation
being hereby renounced so that each Investor (other than any such Investor who
is bound by any employment, consulting or noncompetition agreements that
prohibit such actions) shall (i) have no duty to communicate or present such
Competitive Opportunity to the Company and (ii) have the right to hold any such
Competitive Opportunity for such Investor’s (and its agents’, partners’ or
affiliates’) own account and benefit or to recommend, assign or otherwise
transfer or deal in such Competitive Opportunity to Persons other than the
Company or any Affiliate of the Company.

 

(c)           Specific Performance.  Each Party, in addition to being entitled
to exercise all rights provided herein or granted by law, including recovery of
damages, shall be entitled to specific performance of each other Party’s
obligations under this Agreement, and each Party agrees to waive any requirement
for the security or posting of any bond in connection with such remedy. The
Parties agree that monetary damages would not be adequate compensation for any

 

40

--------------------------------------------------------------------------------

 

loss incurred by reason of a breach by any of them of the provisions of this
Agreement and each hereby agrees to waive the defense in any action for specific
performance that a remedy at law would be adequate.

 

(d)           Governing Law.  This Agreement shall be governed by and construed
in accordance with the internal laws, and not the law of conflicts which would
result in the application of the laws of another jurisdiction, of the State of
Delaware.

 

(e)           Submission to Jurisdiction; Waiver of Jury Trial.  Each of the
Parties hereby irrevocably and unconditionally consents to submit to the
exclusive jurisdiction of the Court of Chancery of the State of Delaware and of
the United States of America sitting in Delaware for any action, proceeding or
investigation in any court or before any governmental authority (“Litigation”)
arising out of or relating to this Agreement, (and agrees not to commence any
Litigation relating thereto except in such court), and further agrees that
service of any process, summons, notice or document by U.S. registered mail to
its respective notice address, as provided for in this Agreement, shall be
effective service of process for any Litigation brought against it in any such
court.  Each of the Parties hereby irrevocably and unconditionally waives any
objection to the laying of venue of any Litigation arising out of this Agreement
or the transactions contemplated hereby in the Court of Chancery of the State of
Delaware or the United States of America sitting in Delaware and hereby further
irrevocably and unconditionally waives and agrees not to plead or claim in any
such court that any such Litigation brought in any such court has been brought
in an inconvenient forum.  Each of the Parties irrevocably and unconditionally
waives, to the fullest extent permitted by applicable law, any and all rights to
trial by jury in connection with any Litigation arising out of or relating to
this Agreement or the transactions contemplated hereby.

 

(F)            DESCRIPTIVE HEADINGS. THE DESCRIPTIVE HEADINGS OF THIS AGREEMENT
ARE INSERTED FOR CONVENIENCE ONLY AND DO NOT CONSTITUTE A PART OF THIS
AGREEMENT.

 

(G)           NOTICES. ALL NOTICES, REQUESTS OR CONSENTS PROVIDED FOR OR
PERMITTED TO BE GIVEN UNDER THIS AGREEMENT SHALL BE IN WRITING AND SHALL BE
GIVEN EITHER BY DEPOSITING SUCH WRITING IN THE UNITED STATES MAIL, ADDRESSED TO
THE RECIPIENT, POSTAGE PAID AND CERTIFIED WITH RETURN RECEIPT REQUESTED, OR BY
DEPOSITING SUCH WRITING WITH A REPUTABLE OVERNIGHT COURIER FOR NEXT DAY
DELIVERY, OR BY DELIVERING SUCH WRITING TO THE RECIPIENT IN PERSON, BY COURIER
OR BY FACSIMILE TRANSMISSION.  A NOTICE, REQUEST OR CONSENT GIVEN UNDER THIS
AGREEMENT SHALL BE DEEMED RECEIVED WHEN ACTUALLY RECEIVED IF PERSONALLY
DELIVERED, WHEN TRANSMITTED, IF TRANSMITTED BY FACSIMILE WITH ELECTRONIC
CONFIRMATION, THE DAY AFTER IT IS SENT, IF SENT FOR NEXT DAY DELIVERY AND UPON
RECEIPT, IF SENT BY MAIL.  ALL SUCH NOTICES, REQUESTS AND CONSENTS SHALL BE
DELIVERED AS FOLLOWS:

 

(I)

IF TO THE COMPANY, ADDRESSED TO IT AT:

 

Marquee Holdings Inc.

920 Main Street

Kansas City, MO 64105

Fax:

(816) 480-4700

Attn:

Kevin M. Connor

 

41

--------------------------------------------------------------------------------

 

with a copy to:

 

 

Latham & Watkins LLP

885 Third Avenue

New York, NY 10022

Fax:

(212) 751-4864

Attn:

Raymond Y. Lin

 

David S. Allinson

 

 

(II)

IF TO THE JPMP INVESTORS, ADDRESSED AS FOLLOWS:

 

 

J.P. Morgan Partners (BHCA), L.P. and affiliated funds

1221 Avenue of the Americas

39th Floor

New York, New York 10020

Fax:

(212) 899-3401

Attn:

Michael R. Hannon

 

Stephen P. Murray

 

 

with a copy to:

 

 

Latham & Watkins LLP

885 Third Avenue

New York, NY 10022

Fax:

(212) 751-4864

Attn:

Raymond Y. Lin

 

David S. Allinson

 

 

(iii)

if to the Apollo Investors, addressed as follows:

 

 

Apollo Management, L.P.

9 West 57th Street

43rd Floor

New York, New York 10019

Fax:

(212) 515-3262

Attn:

Marc Rowan

 

Aaron Stone

 

 

with a copy to:

 

 

Wachtell, Lipton, Rosen & Katz

51 West 52nd Street

New York, New York 10019

Fax:

(212) 403-2000

Attn:

Daniel A. Neff

 

David C. Karp

 

42

--------------------------------------------------------------------------------

 

(iv)

If to the Bain Investors, addressed as follows:

 

 

c/o Bain Capital, LLC

111 Huntington Avenue

Boston, Massachusetts 02199

Facsimile:

(617) 516-2010

Attention:

John Connaughton

 

Phil Loughlin

 

 

with a copy to:

 

 

Ropes & Gray LLP

One International Place

Boston, Massachusetts 02110

Facsimile:

(617) 951-7050

Attention:

R. Newcomb Stillwell

 

Howard S. Glazer

 

 

(v)

If to the Carlyle Investors, addressed as follows:

 

 

c/o The Carlyle Group

520 Madison Avenue, 42nd Floor

New York, New York 10022

Facsimile:

(212) 381-4901

Attention:

Michael Connelly

 

Eliot P. S. Merrill

 

 

with a copy to:

 

Latham & Watkins LLP

885 Third Avenue

New York, New York 10022

Facsimile:

(212) 751-4864

Attention:

R. Ronald Hopkinson

 

 

(vi)

If to the Spectrum Investors, addressed as follows:

 

 

c/o Spectrum Equity Investors

333 Middlefield Road

Suite 200

Menlo Park, CA 94025

Facsimile:

(415) 464-4601

Attention:

Brion Applegate

 

Benjamin Coughlin

 

43

--------------------------------------------------------------------------------

 

with a copy to:

 

 

Latham & Watkins LLP

505 Montgomery Street, Suite 1900

San Francisco, California 94111

Facsimile:

(415) 395-8095

Attention:

Scott R. Haber

 

Tad J. Freese

 

 

and

 

 

(VII) IF TO ANY OTHER MARQUEE INVESTOR, IN ACCORDANCE WITH THE ADDRESS OF EACH
SUCH OTHER MARQUEE INVESTOR ON SCHEDULE 1 HERETO AND IF TO ANY OTHER INVESTOR,
IN ACCORDANCE WITH THE ADDRESS OF EACH SUCH OTHER INVESTOR ON THE SIGNATURE
PAGES ATTACHED HERETO.

 

(h)           Recapitalization, Exchange, Etc. Affecting the Company’s Shares. 
The provisions of this Agreement shall apply, to the full extent set forth
herein, with respect to any and all Shares of the Company or any successor or
assign of the Company (whether by merger, consolidation, sale of assets,
conversion to a corporation or otherwise) that may be issued in respect of, in
exchange for, or in substitution of, the Shares and shall be appropriately
adjusted for any dividends, splits, reverse splits, combinations,
recapitalizations, and the like occurring after the date hereof.

 

(i)            Counterparts.  This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original and all of which
together shall be deemed to constitute one and the same agreement.

 

(j)            Severability.  In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstances, is
held invalid, illegal, or unenforceable in any respect for any reason, the
validity, legality and enforceability of any such provision in every other
respect and of the remaining provisions contained herein shall not be in any way
impaired thereby.

 

(k)           Amendment.  This Agreement may be amended, modified or extended,
and the provisions hereof may be waived, only by a written agreement approved by
the Requisite Stockholder Majority, including, for the avoidance of doubt, any
amendment, modification, extension or waiver that provides that any of the
provisions of this Agreement that would otherwise terminate shall continue after
the IPO Date; provided, that (x) the written consent of each other Party or
Parties shall be required for any such amendment, modification, extension or
waiver that disproportionately affects in any material and adverse manner such
Party or Parties or their rights or obligations hereunder relative to the other
Parties, and (y) so long as there exists at least one Principal Investor, the
written consent of Investors that are not Principal Investors owning at least a
majority of then outstanding Shares owned by Investors that are not Principal
Investors shall also be required for any such amendment, modification, extension
or waiver that disproportionately affects in any material and adverse manner
such Investors that are not Principal Investors, as a group, or their rights or
obligations hereunder relative to the Principal Investors.

 

44

--------------------------------------------------------------------------------

 

At any time hereafter, Persons acquiring Shares in compliance with the
provisions of this Agreement may be made parties hereto by executing a signature
page in the form attached as Exhibit A hereto, which signature page shall be
countersigned by the Company and shall be attached to this Agreement and become
a part hereof without any further action of any other Party hereto.  Except as
otherwise provided herein, in the event that (A) the Company or any successor or
assign consolidates with or merges into any other Person and shall not be the
continuing or surviving corporation or entity in such consolidation or merger,
(B) the Company or any successor or assign transfers all or substantially all of
its properties and assets to any Person, or (C) a sale of the Company is
consummated pursuant to Section 3 and the Investors receive non-publicly traded
equity securities in connection with such transaction, then in the case of
either (A) or (B), proper provision shall be made and all Investors shall
execute such documents and agreements as reasonably requested by the Principal
Investors so that this Agreement shall be given full force and effect with
respect to such surviving corporation or entity or such Person that acquires all
or substantially all of the properties and assets of the Company or any
successor or assign (any such surviving corporation, entity or Person, a
“Successor Entity”), as the case may be, and the rights and obligations of each
Party hereto shall continue in full force and effect such that each Party shall
have the same rights and obligations with respect to the applicable Successor
Entity and its securities as it has with respect to the Company and the Shares,
and in the case of (C) proper provision shall be made and all Investors shall
execute such documents and agreement as reasonably requested by the Principal
Investors so that the provisions of Section 2, Section 3 and Section 4 shall
survive (as may be amended as reasonably determined by the Principal Investors)
with respect to such non-publicly traded equity securities.

 

(l)            Tax Withholding.  The Company shall be entitled to require
payment in cash or deduction from other compensation payable to any Investor of
any sums required by federal, state or local tax law to be withheld with respect
to the issuance, vesting, exercise, repurchase or cancellation of any Shares.

 

(m)          Integration.  This Agreement, the Management Stockholders
Agreement, the Second Amended and Restated Regulatory Sideletter and any side
letters by any Investor or group of Investors, on the one hand, and the Company,
on the other hand, regarding board observer and other management rights,
constitute the entire agreement among the Parties hereto pertaining to the
subject matter hereof and supersede all prior agreements and understandings
pertaining thereto, including the Initial Stockholders Agreement and Exhibit C
to the Merger Agreement.

 

(n)           Further Assurances.  In connection with this Agreement and the
transactions contemplated thereby, each Investor shall execute and deliver any
additional documents and instruments and perform any additional acts that may be
necessary or appropriate to effectuate and perform the provisions of this
Agreement and such transactions.

 

(o)           No Strict Construction.  This Agreement shall be deemed to be
collectively prepared by the Parties, and no ambiguity herein shall be construed
for or against any Party based upon the identity of the author of this Agreement
or any provision hereof.

 

(P)           NO THIRD PARTY BENEFICIARIES.  NEITHER THIS AGREEMENT, NOR ANY
PROVISION CONTAINED HEREIN, SHALL CREATE A THIRD-PARTY BENEFICIARY RELATIONSHIP
OR OTHERWISE CONFER ANY RIGHT,

 

45

--------------------------------------------------------------------------------

 

ENTITLEMENT OR BENEFIT UPON ANY PERSON OTHER THAN THE PARTIES TO THIS AGREEMENT
AND THEIR PERMITTED ASSIGNS.

 

(Q)           NO RECOURSE.  NOTWITHSTANDING ANYTHING THAT MAY BE EXPRESSED OR
IMPLIED IN THIS AGREEMENT, THE COMPANY AND EACH INVESTOR COVENANT, AGREE AND
ACKNOWLEDGE THAT NO RECOURSE UNDER THIS AGREEMENT OR ANY DOCUMENT OR INSTRUMENT
DELIVERED IN CONNECTION WITH THIS AGREEMENT SHALL BE HAD AGAINST ANY CURRENT OR
FUTURE DIRECTOR, OFFICER, EMPLOYEE, AGENT, GENERAL OR LIMITED PARTNER OR MEMBER
OF ANY INVESTOR OR ANY AFFILIATE OR ASSIGNEE THEREOF, AS SUCH, WHETHER BY THE
ENFORCEMENT OF ANY ASSESSMENT OR BY ANY LEGAL OR EQUITABLE PROCEEDING, OR BY
VIRTUE OF ANY STATUTE, REGULATION OR OTHER APPLICABLE LAW, IT BEING EXPRESSLY
AGREED AND ACKNOWLEDGED THAT NO PERSONAL LIABILITY WHATSOEVER SHALL ATTACH TO,
BE IMPOSED UPON OR OTHERWISE BE INCURRED BY ANY CURRENT OR FUTURE DIRECTOR,
OFFICER, EMPLOYEE, AGENT, GENERAL OR LIMITED PARTNER OR MEMBER OF ANY INVESTOR
OR ANY AFFILIATE OR ASSIGNEE THEREOF, AS SUCH, FOR ANY OBLIGATION OF ANY
INVESTOR UNDER THIS AGREEMENT OR ANY DOCUMENTS OR INSTRUMENTS DELIVERED IN
CONNECTION WITH THIS AGREEMENT FOR ANY CLAIM BASED ON, IN RESPECT OF OR BY
REASON OF SUCH OBLIGATIONS OR THEIR CREATION.

 

(R)            AMENDMENT AND RESTATEMENT. AT THE EFFECTIVE TIME, THIS AGREEMENT
SHALL AMEND AND RESTATE THE INITIAL STOCKHOLDERS AGREEMENT IN ITS ENTIRETY.

 

46

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the Parties have executed this Second Amended and Restated
Stockholders Agreement as of the date first above written.

 

 

MARQUEE HOLDINGS INC.

 

 

 

 

 

By:

/s/ Craig R. Ramsey

 

 

 

Name:  Craig R. Ramsey

 

 

 

Title:  Executive Vice President and            Chief Financial Officer

 

 

 

--------------------------------------------------------------------------------

 

 

J.P. MORGAN PARTNERS (BHCA), L.P.

 

 

 

 

 

BY:

  JPMP MASTER FUND MANAGER, L.P.,

 

 

 

ITS GENERAL PARTNER

 

 

BY:

  JPMP CAPITAL CORP.,

 

 

 

ITS GENERAL PARTNER

 

 

 

 

 

 

 

By:

 

/s/ Stephen P. Murray

 

 

 

 

Name:  Stephen P. Murray

 

 

 

 

Title:   Managing Director

 

 

 

 

 

 

 

 

J.P. MORGAN PARTNERS GLOBAL INVESTORS, L.P.

 

 

 

 

 

BY:

  JPMP GLOBAL INVESTORS, L.P.,

 

 

 

ITS GENERAL PARTNER

 

 

BY:

  JPMP CAPITAL CORP.,

 

 

 

ITS GENERAL PARTNER

 

 

 

 

 

 

 

By:

 

/s/ Stephen P. Murray

 

 

 

 

Name:  Stephen P. Murray

 

 

 

 

Title:   Managing Director

 

 

 

 

 

 

 

 

J.P. MORGAN PARTNERS GLOBAL INVESTORS
(CAYMAN), L.P.

 

 

 

 

 

BY:

  JPMP GLOBAL INVESTORS, L.P.,

 

 

 

ITS GENERAL PARTNER

 

 

BY:

  JPMP CAPITAL CORP.,

 

 

 

ITS GENERAL PARTNER

 

 

 

 

 

 

 

By:

 

/s/ Stephen P. Murray

 

 

 

 

Name:  Stephen P. Murray

 

 

 

 

Title:   Managing Director

 

 

--------------------------------------------------------------------------------

 

 

J.P. MORGAN PARTNERS GLOBAL INVESTORS
(CAYMAN) II, L.P.

 

 

 

 

 

BY:

  JPMP GLOBAL INVESTORS, L.P.,

 

 

 

ITS GENERAL PARTNER

 

 

BY:

  JPMP CAPITAL CORP.,

 

 

 

ITS GENERAL PARTNER

 

 

 

 

 

 

 

By:

 

/s/ Stephen P. Murray

 

 

 

 

Name:  Stephen P. Murray

 

 

 

 

Title:   Managing Director

 

 

 

 

 

 

 

 

J.P. MORGAN PARTNERS GLOBAL INVESTORS
(SELLDOWN), L.P.

 

 

 

 

 

BY:

  JPMP GLOBAL INVESTORS, L.P.,

 

 

 

ITS GENERAL PARTNER

 

 

BY:

  JPMP CAPITAL CORP.,

 

 

 

ITS GENERAL PARTNER

 

 

 

 

 

 

 

By:

 

/s/ Stephen P. Murray

 

 

 

 

Name:  Stephen P. Murray

 

 

 

 

Title:   Managing Director

 

 

 

 

 

 

 

 

AMCE (GINGER), L.P.

 

 

 

 

 

BY:

  JPMP GLOBAL INVESTORS, L.P.,

 

 

 

ITS GENERAL PARTNER

 

 

BY:

  JPMP CAPITAL CORP.,

 

 

 

ITS GENERAL PARTNER

 

--------------------------------------------------------------------------------

 

 

By:

 

/s/ Stephen P. Murray

 

 

 

 

Name:  Stephen P. Murray

 

 

 

 

Title:   Managing Director

 

 

 

 

 

 

 

AMCE (LUKE), L.P.

 

 

 

 

 

BY:

  JPMP GLOBAL INVESTORS, L.P.,

 

 

 

ITS GENERAL PARTNER

 

 

BY:

  JPMP CAPITAL CORP.,

 

 

 

ITS GENERAL PARTNER

 

 

 

 

 

 

 

By:

 

/s/ Stephen P. Murray

 

 

 

 

Name:  Stephen P. Murray

 

 

 

 

Title:   Managing Director

 

 

 

 

 

 

 

 

AMCE (SCARLETT), L.P.

 

 

 

 

 

BY:

  JPMP GLOBAL INVESTORS, L.P.,

 

 

 

ITS GENERAL PARTNER

 

 

BY:

  JPMP CAPITAL CORP.,

 

 

 

ITS GENERAL PARTNER

 

 

 

 

 

 

 

By:

 

/s/ Stephen P. Murray

 

 

 

 

Name:  Stephen P. Murray

 

 

 

 

Title:   Managing Director

 

 

--------------------------------------------------------------------------------

 

 

APOLLO INVESTMENT FUND V, L.P.

 

 

 

 

 

BY:

  APOLLO ADVISORS V, L.P.,

 

 

 

ITS GENERAL PARTNER

 

 

BY:

  APOLLO CAPITAL MANAGEMENT V, INC.

 

 

 

ITS GENERAL PARTNER

 

 

 

 

 

 

 

By:

 

/s/ Patricia M. Navis

 

 

 

 

Name:  Patricia M. Navis

 

 

 

 

Title:   Vice President

 

 

 

 

 

 

 

 

APOLLO OVERSEAS PARTNERS V, L.P.

 

 

 

 

 

BY:

  APOLLO ADVISORS V, L.P.,

 

 

 

ITS GENERAL PARTNER

 

 

BY:

  APOLLO CAPITAL MANAGEMENT V, INC.

 

 

 

ITS GENERAL PARTNER

 

 

 

 

 

 

 

By:

 

/s/ Patricia M. Navis

 

 

 

 

Name:  Patricia M. Navis

 

 

 

 

Title:   Vice President

 

 

 

 

 

 

 

 

APOLLO NETHERLANDS PARTNERS V(A), L.P.

 

 

 

 

 

BY:

  APOLLO ADVISORS V, L.P.,

 

 

 

ITS GENERAL PARTNER

 

 

BY:

  APOLLO CAPITAL MANAGEMENT V, INC.

 

 

 

ITS GENERAL PARTNER

 

 

 

 

 

 

 

By:

 

/s/ Patricia M. Navis

 

 

 

 

Name:  Patricia M. Navis

 

 

 

 

Title:   Vice President

 

 

--------------------------------------------------------------------------------

 

 

APOLLO NETHERLANDS PARTNERS V(B), L.P.

 

 

 

 

 

BY:

  APOLLO ADVISORS V, L.P.,

 

 

 

ITS GENERAL PARTNER

 

 

BY:

  APOLLO CAPITAL MANAGEMENT V, INC.

 

 

 

ITS GENERAL PARTNER

 

 

 

 

 

 

 

By:

 

/s/ Patricia M. Navis

 

 

 

 

Name:  Patricia M. Navis

 

 

 

 

Title:   Vice President

 

 

 

 

 

 

 

 

APOLLO GERMAN PARTNERS V GMBH & CO KG

 

 

 

 

 

BY:

  APOLLO ADVISORS V, L.P.,

 

 

 

ITS GENERAL PARTNER

 

 

BY:

  APOLLO CAPITAL MANAGEMENT V, INC.

 

 

 

ITS GENERAL PARTNER

 

 

 

 

 

 

 

By:

 

/s/ Patricia M. Navis

 

 

 

 

Name:  Patricia M. Navis

 

 

 

 

Title:   Vice President

 

 

--------------------------------------------------------------------------------

 

 

BAIN CAPITAL HOLDINGS (LOEWS) I, LLC

 

 

 

 

 

 

BY:

  BAIN CAPITAL HOLDINGS (LOEWS) L,

 

 

 

  L.L.C., ITS ADMINISTRATIVE MEMBER

 

 

BY:

  BAIN CAPITAL HOLDINGS (LOEWS) I

 

 

 

  L.P., ITS ADMINISTRATIVE MEMBER

 

 

BY:

  BAIN CAPITAL PARTNERS VII, L.P.,

 

 

 

  ITS GENERAL PARTNER

 

 

BY:

  BAIN CAPITAL INVESTORS, LLC, ITS

 

 

 

  GENERAL PARTNER

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BAIN CAPITAL AIV (LOEWS) II, L.P.

 

 

 

 

 

 

BY:

  BAIN CAPITAL PARTNERS VIII, L.P.,

 

 

 

  ITS GENERAL PARTNER

 

 

BY:

  BAIN CAPITAL INVESTORS LLC,

 

 

 

  ITS GENERAL PARTNER

 

 

 

 

By:

 

/s/ John P. Connaughton

 

 

 

 

Name:  John P. Connaughton

 

 

 

 

Title:   Managing Director of Bain             Capital Investors LLC*

 

 

 

 

 

 

 

 

 

--------------------------------------------------------------------------------

* On behalf of each of Bain Capital Partners VII, L.P. and Bain Capital Partners
VIII, L.P.

 

--------------------------------------------------------------------------------

 

 

TC GROUP INVESTMENT HOLDINGS, L.P.

 

 

 

 

 

BY:

  TCG HOLDINGS II, L.P.,

 

 

 

ITS GENERAL PARTNER

 

 

BY:

  DBD INVESTORS V, L.L.C.,

 

 

 

ITS GENERAL PARTNER

 

 

 

 

 

/s/ Michael J. Connelly

 

 

Name:

Michael J. Connelly

 

 

Title:

Managing Director

 

 

 

 

 

 

 

CARLYLE PARTNERS III LOEWS, L.P.

 

 

 

 

 

BY:

  TC GROUP III, L.P.,

 

 

 

ITS GENERAL PARTNER

 

 

BY:

  TC GROUP III, L.L.C.,

 

 

 

ITS GENERAL PARTNER

 

 

BY:

  TC GROUP, L.L.C.,

 

 

 

ITS MANAGING MEMBER

 

 

BY:

  TCG HOLDINGS, L.L.C.,

 

 

 

ITS MANAGING MEMBER

 

 

 

 

 

/s/ Michael J. Connelly

 

 

Name:

Michael J. Connelly

 

 

Title:

Managing Director

 

 

 

 

 

 

 

CP III COINVESTMENT, L.P.

 

 

 

 

 

BY:

  TC GROUP III, L.P.,

 

 

 

IT GENERAL PARTNER

 

 

BY:

   TC GROUP III, L.L.C.,

 

 

 

ITS GENERAL PARTNER

 

 

BY:

  TC GROUP, L.L.C.,

 

 

 

ITS MANAGING MEMBER

 

 

BY:

  TCG HOLDINGS, L.L.C.,

 

 

 

ITS MANAGING MEMBER

 

 

 

 

 

 

 

 

 

/s/ Michael J. Connelly

 

 

Name:

Michael J. Connelly

 

 

Title:

Managing Director

 

 

--------------------------------------------------------------------------------

 

 

SPECTRUM EQUITY INVESTORS IV, L.P.

 

 

 

 

 

BY:

  SPECTRUM EQUITY ASSOCIATES IV, L.P.,

 

 

 

ITS GENERAL PARTNER

 

 

 

 

/s/ Brion B. Applegate

 

 

Name:

Brion B. Applegate

 

 

Title:

General Partner

 

 

 

 

 

 

 

 

 

 

SPECTRUM EQUITY INVESTORS PARALLEL IV, L.P.

 

 

 

 

 

BY:

SPECTRUM EQUITY ASSOCIATES IV, L.P.,

 

 

 

ITS GENERAL PARTNER

 

 

 

 

 

/s/ Brion B. Applegate

 

 

Name:

Brion B. Applegate

 

 

Title:

General Partner

 

 

 

 

 

 

 

 

 

SPECTRUM IV INVESTMENT MANAGERS’ FUND, L.P.

 

 

 

 

 

 

/s/ Brion B. Applegate

 

 

Name:

Brion B. Applegate

 

 

Title:

General Partner

 

 

--------------------------------------------------------------------------------

 

 

WESTON PRESIDIO CAPITAL IV, L.P.

 

 

 

 

 

 

 

By:

/s/ David L. Ferguson

 

 

 

Name:  David L. Ferguson

 

 

Title:   General Partner

 

--------------------------------------------------------------------------------

 

 

WPC ENTREPRENEUR FUND II, L.P.

 

 

 

 

 

 

 

By:

/s/ David L. Ferguson

 

 

 

Name:  David L. Ferguson

 

 

Title:  General Partner

 

--------------------------------------------------------------------------------

 

 

SSB CAPITAL PARTNERS (MASTER FUND) I, L.P.

 

 

 

 

 

 

 

By:

/s/ Todd Benson

 

 

 

Name:  Todd Benson

 

 

Title:   Co-President

 

--------------------------------------------------------------------------------

 

 

CAISSE DE DEPOT ET PLACEMENT DU QUEBEC

 

 

 

 

 

 

 

By:

/s/ Eric Lachance

 

 

 

Name:  Eric Lachance

 

 

Title:  Investment Manager

 

 

 

 

 

 

 

 

/s/ Normand Provost

 

 

 

Normand Provost

 

 

Executive VP Private Equity

 

--------------------------------------------------------------------------------

 

 

CO-INVESTMENT PARTNERS, L.P.

 

 

 

BY:

CIP PARTNERS, LLC

 

 

ITS GENERAL PARTNER

 

 

 

 

 

 

 

By:

/s/ Bart D. Osman

 

 

 

Name:  Bart D. Osman

 

 

Title:   Member

 

--------------------------------------------------------------------------------

 

 

CSFB STRATEGIC PARTNERS HOLDINGS II, L.P.

 

 

 

 

 

 

 

By:

/s/ Peter Song

 

 

 

Name:  Peter Song

 

 

Title:   Vice President

 

--------------------------------------------------------------------------------

 

 

CSFB STRATEGIC PARTNERS PARALLEL HOLDINGS II, L.P.

 

 

 

 

 

 

 

By:

/s/ Peter Song

 

 

 

Name:  Peter Song

 

 

Title:   Vice President

 

--------------------------------------------------------------------------------

 

 

GSO CREDIT OPPORTUNITIES FUND (EMPLOYEE), L.P.

 

 

 

 

f/k/a CSFB CREDIT OPPORTUNITIES FUND (EMPLOYEE), L.P.

 

 

 

 

By:

GSO Capital Partners LP, as

 

 

Investment Manager

 

 

 

 

 

 

 

By:

/s/ George Fan

 

 

 

Name:  George Fan

 

 

Title:   Managing Director

 

--------------------------------------------------------------------------------

 

 

GSO CREDIT OPPORTUNITIES FUND (HELIOS), L.P.

 

 

 

 

f/k/a CSFB CREDIT OPPORTUNITIES FUND (HELIOS), L.P.

 

 

 

 

By:

GSO Capital Partners LP, as

 

 

Investment Manager

 

 

 

 

 

 

 

By:

/s/ George Fan

 

 

 

Name:  George Fan

 

 

Title:   Managing Director

 

--------------------------------------------------------------------------------

 

 

CREDIT SUISSE ANLAGESTIFTUNG

 

BY:

PARTNERS GROUP (GUERNSEY) LIMITED,

 

UNDER POWER OF ATTORNEY

 

 

 

 

 

 

 

/s/ Denis O’Malley

 

 

Denis O’Malley, Director

 

 

 

 

 

/s/ Mark Rowe

 

 

Mark Rowe, Director

 

 

--------------------------------------------------------------------------------

 

 

PEARL HOLDING LIMITED EXECUTED BY ITS INVESTMENT MANAGER, PEARL MANAGEMENT
LIMITED 

 

 

 

 

 

 

 

By:

/s/ Denis O’Malley

 

 

 

Denis O’Malley, Director

 

 

 

 

By:

/s/ Mark Rowe

 

 

 

Mark Rowe, Director

 

--------------------------------------------------------------------------------

 

 

PARTNERS GROUP PRIVATE EQUITY PERFORMANCE HOLDING LIMITED

 

 

 

 

 

 

 

By:

/s/ Denis O’Malley

 

 

 

Denis O’Malley, Authorized Signatory

 

 

 

 

By:

/s/ Mark Rowe

 

 

 

Mark Rowe, Director

 

--------------------------------------------------------------------------------

 

 

VEGA INVEST (GUERNSEY) LIMITED

 

 

 

 

 

 

 

By:

/s/ Denis O’Malley

 

 

 

Denis O’Malley, Director

 

 

 

 

By:

/s/ Mark Rowe

 

 

 

Mark Rowe, Director

 

 

--------------------------------------------------------------------------------

 

 

ALPINVEST PARTNERS CS INVESTMENTS  2003 C.V., by AlpInvest Partners 2003 B.V.,
its general partners, in its turn represented by AlpInvest Partners N.V., its
managing director

 

 

 

 

 

 

 

By:

/s/ E.M.J. Thyssen

 

 

 

Name: E.M.J. Thyssen

 

 

Title: Managing Partner

 

--------------------------------------------------------------------------------

 

 

ALPINVEST PARTNERS LATER STAGE CO-  INVESTMENTS CUSTODIAN II B.V., represented
by AlpInvest Partners N.V., its managing director

 

 

 

 

 

 

 

By:

/s/ E.M.J. Thyssen

 

 

 

Name: E.M.J. Thyssen

 

 

Title: Managing Partner

 

--------------------------------------------------------------------------------

 

 

ALPINVEST PARTNERS LATER STAGE CO-  INVESTMENTS CUSTODIAN IIA B.V., represented
by AlpInvest Partners N.V., its managing director

 

 

 

 

 

 

 

By:

/s/ E.M.J. Thyssen

 

 

 

Name: E.M.J. Thyssen

 

 

Title: Managing Partner

 

--------------------------------------------------------------------------------

 

 

SCREEN INVESTORS 2004, LLC

 

 

 

 

 

 

 

By:

/s/ Christopher Fillo

 

 

 

Name: Christopher Fillo

 

 

Title: Vice President

 

 

Main Street Advisors, Inc.

 

 

its Manager

 

--------------------------------------------------------------------------------

 

SCHEDULE 1

 

SCHEDULE OF OTHER MARQUEE INVESTORS

 

Name of Other Marquee Investor

 

Address

Weston Presidio Capital IV, L.P.

 

108 South Frontage Road West
Suite 307
Vail, Colorado 81657
Attention: Dave Ferguson
Facsimile: (970) 476-7900

WPC Entrepreneur Fund II, L.P.

 

108 South Frontage Road West
Suite 307
Vail, Colorado 81657
Attention: Dave Ferguson
Facsimile: (970) 476-7900

Co-Investment Partners, L.P.

 

660 Madison Avenue, 23rd Floor
New York, New York 10021
Attention: Bart Osman
Facsimile: (212) 754-1494

Caisse de Depot et Placement du Quebec

 

1000, Place Jean-Paul-Riopelle, 4th Floor
Montreal, Quebec H2Z 2B3
Canada
Attention: Jacques Marchand
Facsimile: (514) 847-5980

AlpInvest Partners CS Investments 2003 C.V.

 

600 Fifth Avenue, 17th Floor
New York, New York 10020
Attention: Iain Leigh
Facsimile:

AlpInvest Partners Later Stage Co-Investments Custodian II B.V.

 

600 Fifth Avenue, 17th Floor
New York, New York 10020
Attention: Iain Leigh
Facsimile:

AlpInvest Partners Later Stage Co-Investments Custodian IIA B.V.

 

600 Fifth Avenue, 17th Floor
New York, New York 10020
Attention: Iain Leigh
Facsimile:

SSB Capital Partners (Master Fund) I, L.P.

 

388 Greenwich Street, 32nd Floor
New York, NY 10013
Attention: Rakesh K. Jain
Facsimile: 212-816-0221

CSFB Strategic Partners Holdings II, L.P.

 

Eleven Madison Avenue, 16th Floor
New York, New York 10010
Attention: Peter Song
Facsimile: (646) 935-7048

 

--------------------------------------------------------------------------------

 

CSFB Strategic Partners Parallel Holdings II, L.P.

 

Eleven Madison Avenue, 16th Floor
New York, New York 10010
Attention: Peter Song
Facsimile: (646) 935-7048

GSO Credit Opportunities Fund (Employee), L.P.

 

Eleven Madison Avenue, 16th Floor
New York, New York 10010
Attention: Peter Song
Facsimile: (646) 935-7048

GSO Credit Opportunities Fund (Helios), L.P.

 

Eleven Madison Avenue, 16th Floor
New York, New York 10010
Attention: Peter Song
Facsimile: (646) 935-7048

Credit Suisse Anlagestiftung

 

126 East 56th Street, 11th Floor
New York, New York 10022
Attention: Andreas Baumann
Facsimile: (212) 763-4701

Pearl Holding Limited

 

126 East 56th Street, 11th Floor
New York, New York 10022
Attention: Andreas Baumann
Facsimile: (212) 763-4701

Partners Group Private Equity Performance Holding Limited

 

126 East 56th Street, 11th Floor
New York, New York 10022
Attention: Andreas Baumann
Facsimile: (212) 763-4701

Vega Invest (Guernsey) Limited

 

126 East 56th Street, 11th Floor
New York, New York 10022
Attention: Andreas Baumann
Facsimile: (212) 763-4701

Screen Investors 2004, LLC

 

3110 Main Street, Suite 300
Santa Monica, CA 90405
Attention: Christopher M. Fillo
Facsimile: 310-392-3541

 

--------------------------------------------------------------------------------

 

EXHIBIT A

 

SIGNATURE PAGE
TO THE
SECOND AMENDED AND RESTATED STOCKHOLDERS AGREEMENT

 

By execution of this signature page,
                                                    hereby agrees to become a
party to, be bound by the obligations of and receive the benefits of that
certain Second Amended and Restated Stockholders Agreement, dated as of
                       , as amended from time to time, by and among Marquee
Holdings Inc., a Delaware corporation, J.P. Morgan Partners (BHCA), L.P., J.P.
Morgan Partners Global Investors, L.P., J.P. Morgan Partners Global Investors A,
L.P.,  J.P. Morgan Partners Global Investors (Cayman), J.P. Morgan Partners
Global Investors (Cayman) II, L.P., J.P. Morgan Partners Global Investors
(Selldown), L.P., AMCE (Ginger), L.P., AMCE (Luke), L.P., AMCE (Scarlett), L.P.,
Apollo Investment Fund V, L.P., Apollo Overseas Partners V, L.P., Apollo
Netherlands Partners V(A), L.P., Apollo Netherlands Partners V(B), L.P., Apollo
German Partners V GmbH & Co KG, the entities listed on Schedule 1 thereto, TC
Group III, L.P., Carlyle Partners III Loews, L.P., CP III Coinvestment, L.P.,
Bain Capital Holdings (Loews) I L.P., Bain Capital AIV (Loews) II, L.P.,
Spectrum Equity Investors IV, L.P., Spectrum Equity Investors Parallel IV, L.P.
and Spectrum IV Investment Managers’ Fund, L.P., as amended from time to time
thereafter and shall be deemed to be an “Investor” for all purposes thereunder.

 

 

 

 

 

 

 

 

 

By:

 

 

 

 

Name:

 

 

Title:

 

--------------------------------------------------------------------------------

 

 

Notice Address:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accepted:

 

 

 

 

MARQUEE HOLDINGS INC.

 

 

 

 

 

 

 

By:

 

 

 

 

 

 

Name:

 

 

 

 

Title:

 

 

 

 

26

--------------------------------------------------------------------------------

 

EXHIBIT B

 

 

Second Amended and Restated Regulatory Sideletter

 

 

[Attached hereto]

 

--------------------------------------------------------------------------------

 

EXHIBIT C

 

 

Amended and Restated Management Stockholders Agreement

 

 

[Attached hereto]

 

--------------------------------------------------------------------------------