Exhibit 10.4

 

EXECUTION COPY

 

AMENDED AND RESTATED SALE PARTICIPATION AGREEMENT

 

 

Dated as of September 24, 2004

 

Mr. Seifollah Ghasemi
c/o Rockwood Holdings, Inc.
100 Overlook Center
Princeton, NJ  08540

 

Dear Seifi:

 

You have entered into an Amended and Restated Management Stockholder’s
Agreement, dated as of September 24, 2004 between Rockwood Holdings, Inc., a
Delaware corporation (the “Company”), and you (the “Stockholder’s Agreement”) to
amend and restate the Management Stockholder’s Agreement, dated as of November
1, 2001, between the Company and you relating to the purchase by you from the
Company of 1,000 shares (the “Existing Purchased Stock”) of common stock, par
value $0.01 per share, of the Company (the “Common Stock”), a receipt by you
from the Company of an option to acquire 12,000 shares of Common Stock from the
Company (the “Existing Option”) and a receipt by you from the Company of a grant
of 2,000 restricted stock units (the “Restricted Stock Units”), under which you
are entitled to receive one share of Common Stock for each restricted stock unit
(such Common Stock, the “Existing Restricted Stock”), and to set forth the terms
and conditions of your rights as Management Stockholder with respect to the
3,000 additional shares of Common Stock purchased by you under the Stockholder’s
Agreement (the “New Purchased Stock” and, together with the Existing Purchased
Stock, the “Purchased Stock”), two new options to purchase shares of Common
Stock (the “New Options” and together with the Existing Option, the “Options”)
granted to you by the Company, the Existing Purchased Stock, the Existing Option
and the Existing Restricted Stock.  The undersigned, KKR 1996 Fund L.P., KKR
Partners II, L.P., KKR Millennium Fund, L.P., KKR Partners III, L.P. and KKR
European Fund, Limited Partnership (collectively, the “KKR Partners”), also have
purchased shares of Common Stock and hereby agree with you as follows, effective
upon your entering into the Stockholder’s Agreement with the Company:

 

1.             In the event that at any time any of the KKR Partners proposes to
sell for cash or any other consideration any shares of Common Stock owned by it,
in any transaction other than a Public Offering (as defined in the Stockholder’s
Agreement) or a sale to an affiliate of KKR Partners, the KKR Partners will
notify you or your Management Stockholder’s Estate or Management Stockholder’s
Trust (as such terms are defined in Section 2 of the Stockholder’s Agreement and
collectively with you, the “Management Stockholder Entities”), as the case may
be, in writing (a “Notice”) of such proposed sale (a “Proposed Sale”) and the
material terms of the Proposed Sale as of the date of the Notice (the “Material
Terms”) promptly, and in any event not less than 15 calendar days prior to the
consummation of the Proposed Sale and not more than

 

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5 calendar days after the execution of the definitive agreement relating to the
Proposed Sale, if any (the “Sale Agreement”).  If within 10 calendar days of the
applicable Management Stockholder Entities’ receipt of such Notice, the KKR
Partner receives from the applicable Management Stockholder Entities, a written
request (a “Request”) to include Common Stock held by the applicable Management
Stockholder Entities in the Proposed Sale (which Request shall be irrevocable
unless (a) there shall be a material adverse change in the Material Terms or (b)
if otherwise mutually agreed to in writing by the applicable Management
Stockholder Entities and the KKR Partner), the Common Stock held by you will be
so included as provided herein; provided that only one Request, which shall be
executed by the applicable Management Stockholder Entities, may be delivered
with respect to any Proposed Sale for shares of Common Stock held by the
applicable Management Stockholder Entities.  Promptly after the execution of the
Sale Agreement, the KKR Partner will furnish the applicable Management
Stockholder Entities with a copy of the Sale Agreement, if any.

 

2.             (a)  The maximum number of shares of Common Stock which the
applicable Management Stockholder Entities will be permitted to include in a
Proposed Sale pursuant to a Request will be the number of shares of Common Stock
then held by the Management Stockholder Entities, including all shares of Common
Stock which the Management Stockholder Entities are then entitled to acquire
under unexercised Options, to the extent then exercisable or would become
exercisable as a result of the consummation of the Proposed Sale, multiplied by
a fraction, the numerator of which is the number of shares of Common Stock being
sold by KKR Partners and any investment partnerships and investment limited
liability companies affiliated with KKR Partners and the denominator of which is
the aggregate number of shares of Common Stock owned by KKR Partners and any
investment partnerships and investment limited liability companies affiliated
with KKR Partners.

 

(b)  If one or more holders of shares of Common Stock who have been granted the
same rights granted to the Management Stockholder Entities hereunder elect not
to include the maximum number of shares of Common Stock which such holders would
have been permitted to include in a Proposed Sale (the “Eligible Shares”), KKR
Partners, or such remaining holders of shares of Common Stock, or any of them,
may sell in the Proposed Sale a number of additional shares of Common Stock
owned by any of them equal to their pro rata portion of the number of Eligible
Shares not included in the Proposed Sale, based on the relative number of shares
of Common Stock then held by each such holder, and such additional shares of
Common Stock which any such holder or holders propose to sell shall not be
included in any calculation made pursuant to the first sentence of Section 2(a)
above for the purpose of determining the number of shares of Common Stock which
the Management Stockholder Entities will be permitted to include in a Proposed
Sale.  KKR Partners or any of them may sell in the Proposed Sale additional
shares of Common Stock owned by any of them equal to any remaining Eligible
Shares which will not be included in the Proposed Sale pursuant to the
foregoing.

 

3.             Except as may otherwise be provided herein, shares of Common
Stock subject to a Request will be included in a Proposed Sale on the same terms
and subject to the same conditions applicable to the shares of Common Stock
which the KKR Partner proposes to sell in the Proposed Sale.  Such terms and
conditions shall include, without limitation:  the pro rata reduction of the
number of shares of Common Stock to be included in the Proposed Sale if required
by the party proposing such Sale; the sale price; the payment of fees,
commissions and

 

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expenses; the provision of, and representation and warranty as to, information
reasonably requested by the KKR Partner covering matters regarding your
ownership of shares; and the provision of requisite indemnification; provided
that, any indemnification provided by the applicable Management Stockholder
Entities shall be pro rata in proportion with the number of shares of Common
Stock to be sold.

 

4.             Upon delivering a Request, the applicable Management Stockholder
Entities will, if requested by the KKR Partner, execute and deliver a custody
agreement and power of attorney in form and substance satisfactory to the KKR
Partner with respect to the shares of Common Stock which are to be sold by the
applicable Management Stockholder Entities pursuant hereto (a “Custody Agreement
and Power of Attorney”).  The Custody Agreement and Power of Attorney will
provide, among other things, that the applicable Management Stockholder Entities
will deliver to and deposit in custody with the custodian and attorney-in-fact
named therein a certificate or certificates representing such shares of Common
Stock (duly endorsed in blank by the registered owner or owners thereof) and
irrevocably appoint said custodian and attorney-in-fact as the applicable
Management Stockholder Entities’ agent and attorney-in-fact with full power and
authority to act under the Custody Agreement and Power of Attorney on behalf of
the applicable Management Stockholder Entities with respect to the matters
specified therein.

 

5.             The Management Stockholder Entities’ right pursuant hereto to
participate in a Proposed Sale shall be contingent on the Management Stockholder
Entities’ strict compliance with each of the provisions hereof and the
Management Stockholder Entities’ respective willingness to execute such
documents in connection therewith as may be reasonably requested by any KKR
Partner.

 

6.             In the event of a Proposed Sale pursuant to Section 1 hereof of a
majority of the shares of Common Stock held by the KKR Partners, the KKR
Partners may elect, by so specifying in the Notice, to require the applicable
Management Stockholder Entities to participate in such Proposed Sale to the same
extent calculated pursuant to Section 2(a) above, in accordance with the terms
and provisions of Sections 3 and 4 hereof; provided, however, that in such
event, the order in which the shares of Common Stock held by the applicable
Management Stockholder Entities shall be required to be sold shall be: first,
any Purchased Stock; second, any shares of Common Stock acquired pursuant to the
exercise of any exercisable Options; and lastly, any shares of Common Stock
acquired in respect of any vested Restricted Stock Units.

 

7.             The obligations of KKR Partners hereunder shall extend only to
the Management Stockholder Entities, and no other successors or assigns of the
Management Stockholder Entities shall have any rights pursuant hereto.

 

8.             This Agreement shall terminate and be of no further force and
effect on the fifth anniversary of the first occurrence of a Public Offering (as
defined in the Stockholder’s Agreement).

 

9.             All notices and other communications provided for herein shall be
in writing and shall be deemed to have been duly given when delivered to the
party to whom it is directed:

 

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If to KKR Partners, to it at the following address:

 

c/o Kohlberg Kravis Roberts & Co. L.P.
9 West 57th Street
New York, NY 10019
Attn: Brian Carroll

with a copy to:

 

Simpson Thacher & Bartlett LLP
425 Lexington Avenue
New York, NY  10017
Attn:  Roxane F. Reardon, Esq.

 

If to you, to you at the address first set forth above herein;

 

If to your Management Stockholder’s Estate or Management Stockholder’s Trust, at
the address provided to the Company by such entity or at such other address as
such entity shall have specified by notice in writing delivered to the other
parties to this Agreement by certified mail.

 

10.           The laws of the State of Delaware (or if the Company
reincorporates in another state, of that state) shall govern the interpretation,
validity and performance of the terms of this Agreement.  No suit, action or
proceeding with respect to this Agreement may be brought in any court or before
any similar authority other than in a court of competent jurisdiction in the
State of Delaware (or if the Company reincorporates in another state, of that
state), as the KKR Partners may elect in their sole discretion, and you hereby
submit to the non-exclusive jurisdiction of such courts for the purpose of such
suit, proceeding or judgment.  You hereby irrevocably waive any right which you
may have had to bring such an action in any other court, domestic or foreign, or
before any similar domestic or foreign authority.

 

11.           If any KKR Partner transfers its interest in the Company to an
affiliate of KKR Partners, such affiliate shall assume the obligations hereunder
of such KKR Partner.

 

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It is the understanding of the undersigned that you are aware that no Proposed
Sale presently is contemplated and that such a sale may never occur.

 

If the foregoing accurately sets forth our agreement, please acknowledge your
acceptance thereof in the space provided below for that purpose.

 

 

Very truly yours,

 

 

 

 

 

KKR 1996 Fund L.P.

 

 

 

By:

KKR Associates 1996 L.P.

 

 

its General Partner

 

 

 

By:

KKR 1996 GP LLC,

 

 

its General Partner

 

 

 

By:

/s/ Perry Golkin

 

 

 

General Partner

 

 

 

 

 

KKR PARTNERS II, L.P.

 

 

 

By:

KKR Associates L.P.,

 

 

General Partner

 

 

 

By:

/s/ Perry Golkin

 

 

 

General Partner

 

 

 

 

 

KKR MILLENNIUM FUND, L.P.

 

 

as General Partner

 

 

 

By:

KKR MILLENNIUM GP LLC

 

 

as General Partner

 

 

 

By:

/s/ Perry Golkin

 

 

 

Member

 

 

 

KKR PARTNERS III, L.P.

 

 

 

By:

KKR GP III, LLC,

 

 

its General Partner

 

 

 

By:

/s/ Perry Golkin

 

 

 

Member

 

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KKR EUROPEAN FUND, LIMITED

 

 

PARTNERSHIP

 

 

 

By:

KKR ASSOCIATES EUROPE, LIMITED
PARTNERSHIP, as General Partner

 

 

 

By:

KKR EUROPE LIMITED,

 

 

as General Partner

 

 

 

By:

/s/ Perry Golkin

 

 

 

Director

 

 

 

 

Accepted and agreed to:

 

 

 

 

 

By:

/s/ Seifollah Ghasemi

 

 

 

Name: Seifollah Ghasemi

 

 

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