Exhibit 10.11


 


FORM OF SALE PARTICIPATION AGREEMENT


 


[Date]


[Name]


c/o International Transmission Company

39500 Orchard Hill Place, Suite 200


Novi,
Michigan 48375


 


Dear [Name]:


You have entered into a
Management Stockholder’s Agreement, dated as of [Date]
between ITC Holdings Corp., a Michigan corporation (“the Company”), and
you (the “Stockholder’s Agreement”) relating to your acquisition from
the Company of shares of common stock of the Company (the “Common Stock”).  The undersigned, International Transmission
Holdings Limited Partnership, a Michigan limited partnership (“Holdings”)
hereby agrees with you as follows, effective upon such acquisition of Common
Stock:


1.     In the event that at any time Holdings
(together with any of its respective affiliates, to the extent provided for in
Paragraph 8 hereof, the “Selling Partnerships”) 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 the Selling Partnerships, the Selling
Partnership(s) 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 days prior to the consummation of
the Proposed Sale and not more than 5 days after the execution of the
definitive agreement relating to the Proposed Sale, if any (the “Sale
Agreement”).  If, within 10 days
after the Management Stockholder Entities’ receipt of such Notice, the Selling
Partnership receives from the Management Stockholder Entities a written request
(a “Request”) to include Common Stock held by the 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 Management Stockholder Entities,
and the Selling Partnership), the Common Stock held by you will be so included
as provided herein; provided that only one Request, which shall be executed by
Management Stockholder Entities, may be delivered with respect to any Proposed
Sale for Common Stock held by Management Stockholder Entities.  Promptly after the execution of the Sale
Agreement, the Selling Partnership will furnish Management Stockholder Entities
with a copy of the Sale Agreement, if any.


2.     (a) The
number of shares of Common Stock which the Management Stockholder Entities will
be permitted to include in a Proposed Sale pursuant to a Management Stockholder
Request will be the lesser of (i) the sum of the number of shares of Common
Stock  then actually owned (or deemed
owned) by the Management Stockholder Entities plus all shares of Common
Stock which you are then entitled to acquire under any unexercised portion of
the


 





















 


Option, to the extent such Option is then exercisable
or would become exercisable as a result of the consummation of the Proposed
Sale and (ii) the sum of the shares of Common Stock then actually owned (or
deemed owned) by the Management Stockholder Entities plus all shares of
Common Stock which you are entitled to acquire under any unexercised portion of
the Option, whether or not fully exercisable, multiplied by a fraction (x) the
numerator of which shall be the aggregate number of shares of Common Stock
which a Selling Partnership or the Selling Partnerships propose to sell in the
Proposed Sale (after giving effect to the applicable provisions of the
Management Stockholders’ Agreement and any other written agreement between the
Selling Partnerships and any holder of shares of Common Stock that gives the
right to such holder to participate in the Proposed Sale (on “Eligible  Holder”)
and (y) the denominator of which shall be the total number of shares of Common
Stock owned by such Selling Partnership or the Selling Partnerships, as the
case may be.


(b) If one or more
Eligible Holders 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 pursuant to Paragraph 2(a) (such non-included shares, the “Eligible
Shares”), then each of the Selling Partnerships, or the remaining Eligible
Holders, or any of them, will have the right to sell in the Proposed Sale a number
of additional shares of their Common Stock equal to their pro rata portion of
the number of Eligible Shares, based on the relative number of shares of Common
Stock then actually held (or deemed held) by each such holder, and such
additional shares of Common Stock which any such holder or holders propose to
sell shall be included in any calculation made pursuant to this Paragraph 2 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.  The Selling Partnerships, or any
of them, will have the right to sell in the Proposed Sale additional shares of
Common Stock owned by them equal to the number, if any, of 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
pursuant hereto and in any agreements with purchasers relating thereto on the
same terms and subject to the same conditions applicable to the shares of
Common Stock which the Selling Partnership 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 expenses; the provision of, and representation
and warranty as to, information reasonably requested by the Selling Partnership
covering matters regarding your ownership of shares; and the provision of
requisite indemnification; provided that any indemnification provided by
the 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 Management Stockholder Entities, will, if requested
by the Selling Partnership, execute and deliver a custody agreement and power
of attorney in form and substance satisfactory to the Selling Partnership with
respect to the shares of Common Stock which are to be sold by the 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 Management
Stockholder Entities will


 


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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 Management Stockholder Entities’ agent and attorney-in-fact with full power
and authority to act under the Custody Agreement and Power of Attorney on the
Management Stockholder Entities’ behalf 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 the Selling Partnership.


6.     (a) In the event of a Proposed Sale
pursuant to Section 1 hereof, the Selling Partnerships may elect, by so
specifying in the Notice, to require the Management Stockholder Entities to,
and the Management Stockholder Entities shall, participate in such Proposed
Sale to the same extent calculated pursuant to Section 2(a) above, in
accordance with the terms and provisions of Section 3 hereof; provided, however,
that in such event, the order in which the shares of Common Stock held by as
the Management Stockholder Entities, shall be required to be sold shall be:
first, any Purchased Stock (as defined in the Stockholder’s Agreement); and
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 granted pursuant to a Restricted Stock Award
Agreement.


(b) In the event of a
transaction which results in a Change of Ownership (as defined in the
Stockholder’s Agreement) but is not a Proposed Sale (a “Proposed Transaction”),
you agree on behalf of the Management Stockholder Entities, to bear your pro
rata share of any fees, commissions, adjustments to purchase price, expenses or
indemnities borne by the relevant Selling Partnership(s).


(c) Your pro rata share
of any amount to be paid pursuant to Paragraphs 4 or 6(b) shall be based upon
the number of shares of Common Stock actually held (or deemed held) by the
Management Stockholder Entities plus the number of shares of Common Stock you
would have the right to acquire under any unexercised portion of the Option
which is then vested or would become vested as a result of the Proposed Sale or
Proposed Transaction.


 


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


8.     If the Selling Partnerships transfers any
of their interests in the Company to an affiliate of any of the Selling
Partnerships, such affiliate shall assume the obligations hereunder of the
Selling Partnerships.


9.     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).


 


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10.   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:


If to the Selling
Partnerships, to each of them at the following address:


International
Transmission Holdings Limited Partnership


Ironhill Transmission, LLC


c/o Dykema Gossett PLLC


124 West Allegan, Ste. 800


Lansing, Michigan 48933


Attn: Albert
Ernst, Esq.


 


with copies to:


 


Simpson Thacher & Bartlett


425 Lexington Avenue


New York, New York 
10017


Attn:  David
Sorkin, Esq.


          Alvin
Brown, 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 such partnerships by such entity;


or at such other address as
any of the above shall have specified by notice in writing delivered to the
others by certified mail.


11.   The laws of the State of Michigan (or if the
Company reincorporates in another state, of that state) shall govern the
interpretation, validity and performance of the terms of this Agreement.  In the event of any controversy among the
parties hereto arising out of, or relating to, this Agreement which cannot be
settled amicably by the parties, such controversy shall be finally, exclusively
and conclusively settled by mandatory arbitration conducted expeditiously in
accordance with the American Arbitration Association rules, by a single
independent arbitrator.   Such
arbitration process shall take place within 100 miles of the Detroit, Michigan
metropolitan area.  The decision of the
arbitrator shall be final and binding upon all parties hereto and shall be
rendered pursuant to a written decision, which contains a detailed recital of
the arbitrator’s reasoning.  Judgment
upon the award rendered may be entered in any court having jurisdiction
thereof.  Each party shall bear its own
legal fees and expenses, unless otherwise determined by the arbitrator.  You hereby irrevocably waive any right that
you may have had to bring an action in any court, domestic or foreign, or
before any similar domestic or foreign authority with respect to this
Agreement.


12.   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.


[Signatures on next page.]


 


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


 


	
   

  	
  Very truly yours,

  
	
   

  	
   

  
	
   

  	
  INTERNATIONAL TRANSMISSION
  HOLDINGS LIMITED PARTNERSHIP

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Ironhill Transmission LLC,
  its

  
	
   

  	
   

  	
  General Partner

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  



 


 


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  Accepted and agreed this
  _____ day of

  
	
   

  
	
  _________
  200_.

  
	
   

  
	
   

  	
   

  
	
  [Name]

  



 


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