Exhibit 10.3


 




 


 


 


INSIGHT COMMUNICATIONS
COMPANY, INC.


 


 





SECURITYHOLDERS AGREEMENT


 


 


 




Dated as of December 16,
2005


 


 


 





 





















 


TABLE OF CONTENTS


 


	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 1.

  	
  Restrictions on Transfer

  	
  1

  
	
   

  	
   

  	
   

  
	
  Section 2.

  	
  Tag-Along Rights

  	
  5

  
	
   

  	
   

  	
   

  
	
  Section 3.

  	
  Drag-Along Rights

  	
  6

  
	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  Drag-Along Notice

  	
  6

  
	
   

  	
  (b)

  	
  Conditions to Drag-Along

  	
  7

  
	
   

  	
  (c)

  	
  Remedies

  	
  8

  
	
   

  	
   

  	
   

  
	
  Section 4.

  	
  Exit Transactions and Procedures

  	
  9

  
	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  IPO, Sale or Recapitalization of the Company

  	
  9

  
	
   

  	
  (b)

  	
  Partnership Split-Up

  	
  15

  
	
   

  	
  (c)

  	
  Control of Process

  	
  16

  
	
   

  	
  (d)

  	
  Final Reclassification

  	
  17

  
	
   

  	
  (e)

  	
  Qualified IPO Procedures

  	
  21

  
	
   

  	
  (f)

  	
  Voting and Securityholder Cooperation

  	
  21

  
	
   

  	
   

  	
   

  
	
  Section 5.

  	
  Piggyback Registration Rights

  	
  22

  
	
   

  	
   

  	
   

  
	
  Section 6.

  	
  Registration upon Request

  	
  24

  
	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  Request for Registration

  	
  24

  
	
   

  	
  (b)

  	
  Limitations on Registrations

  	
  25

  
	
   

  	
  (c)

  	
  Additional Limitation

  	
  26

  
	
   

  	
  (d)

  	
  Limitation on Sales

  	
  26

  
	
   

  	
   

  	
   

  
	
  Section 7.

  	
  Registration Procedures

  	
  26

  
	
   

  	
   

  	
   

  
	
  Section 8.

  	
  Indemnification

  	
  30

  
	
   

  	
   

  	
   

  
	
  Section 9.

  	
  Management Bonus Pool

  	
  32

  
	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  Management Representatives’ Allocations

  	
  32

  
	
   

  	
  (b)

  	
  Compensation Committee Allocations

  	
  32

  
	
   

  	
  (c)

  	
  Certain Allocations; Payment

  	
  33

  
	
   

  	
  (d)

  	
  Management Representatives

  	
  33

  
	
   

  	
  (e)

  	
  Partnership Split-Up

  	
  33

  
	
   

  	
  (f)

  	
  Ordinary Course Bonuses

  	
  34

  
	
   

  	
   

  	
   

  
	
  Section 10.

  	
  Certain Rights and Obligations

  	
  34

  
	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  Certain Voting Rights; Venture Capital Investment

  	
  34

  
	
   

  	
  (b)

  	
  Restrictions on Rights in Certain Business Ventures

  	
  34

  



 


i





















 


	
   

  	
  (c)

  	
  Independent Directors

  	
  35

  
	
   

  	
   

  	
   

  
	
  Section 11.

  	
  Proxies

  	
  35

  
	
   

  	
   

  	
   

  
	
  Section 12.

  	
  Miscellaneous

  	
  37

  
	
   

  	
   

  	
   

  
	
   

  	
  (a)

  	
  Severability

  	
  37

  
	
   

  	
  (b)

  	
  Information

  	
  37

  
	
   

  	
  (c)

  	
  Notices

  	
  38

  
	
   

  	
  (d)

  	
  Termination

  	
  39

  
	
   

  	
  (e)

  	
  Legends

  	
  40

  
	
   

  	
  (f)

  	
  Headings

  	
  40

  
	
   

  	
  (g)

  	
  Entire Agreement

  	
  40

  
	
   

  	
  (h)

  	
  Counterparts

  	
  41

  
	
   

  	
  (i)

  	
  Governing Law

  	
  41

  
	
   

  	
  (j)

  	
  Binding Effect

  	
  41

  
	
   

  	
  (k)

  	
  Remedy

  	
  41

  
	
   

  	
  (l)

  	
  Assignment

  	
  41

  
	
   

  	
  (m)

  	
  Third Party Beneficiaries

  	
  41

  
	
   

  	
  (n)

  	
  Amendment; Waivers, Etc

  	
  41

  
	
   

  	
  (o)

  	
  Consent to Jurisdiction

  	
  42

  
	
   

  	
  (p)

  	
  Waiver of Jury Trial

  	
  43

  
	
   

  	
  (q)

  	
  Subsequent Securityholders

  	
  43

  
	
   

  	
  (r)

  	
  Certain Definitions

  	
  43

  



 


ii





















 


EXECUTION COPY


 


SECURITYHOLDERS AGREEMENT


 


SECURITYHOLDERS AGREEMENT (this “Agreement”),
dated as of December 16, 2005, among (i) CARLYLE PARTNERS III
TELECOMMUNICATIONS, L.P. (“CP III”), CARLYLE PARTNERS IV TELECOMMUNICATIONS,
L.P. (“CP IV”), CP III COINVESTMENT, L.P. and CP IV COINVESTMENT, L.P., each a
Delaware limited partnership (each individually, and collectively together with
their Permitted Assignees, “Carlyle”), (ii) INSIGHT COMMUNICATIONS
COMPANY, INC., a Delaware corporation (the “Company”), (iii) those
individuals identified as “Continuing Investor Securityholders” on the
signature pages hereof (the “Continuing Investor Securityholders”),
(iv) Continuing Investor Holding Company, LLC, a Delaware limited
liability company (“Holdco”), (v) PH Investments, LLC, a Delaware limited
liability company (“PH Investments”), and (vi) each other Person
who subsequently becomes a party to this Agreement (together with Carlyle, the
Continuing Investor Securityholders, Holdco and PH Investments, the “Securityholders”).  Capitalized terms used herein without
definition are defined in Section 12(r).


 


RECITALS:


 


WHEREAS, upon the terms and conditions set forth in
the Agreement and Plan of Merger, dated as of July 28, 2005 (as the same
may from time to time be amended, modified, supplemented or restated, the “Merger
Agreement”), among Insight Acquisition Corp., a Delaware corporation (“Parent”),
and the Company, at the Effective Time, Parent will merge with and into the
Company with the Company remaining as the surviving corporation; and


 


WHEREAS, the Securityholders and the Company are
executing this Agreement concurrently with the Closing under the Merger
Agreement to set forth certain understandings and agreements regarding their
respective ownership of Equity Securities of the Company;


 


NOW, THEREFORE, in consideration of the mutual
promises, covenants, representations and warranties made herein and of the
mutual benefits to be derived herefrom, the parties hereto agree as follows:


 


Section 1.               Restrictions
on Transfer.  Except as set forth
below, no party hereto may sell, transfer, pledge, encumber or otherwise
dispose of, whether directly or indirectly (by merger or sale of equity in any
direct or indirect holding company or otherwise), and whether voluntarily or by
operation of law (“Transfer”), any Equity Securities to any Person other
than the Company.  The Transfers
prohibited by the foregoing sentence shall, for avoidance of doubt, include any
Transfer of the capital stock of ICI Communications, Inc. for so long as
it is a holder of Equity Securities. 
Notwithstanding the foregoing, subject to the terms of any subscription
or like agreement


 





















 


pursuant to which a
Securityholder acquired Equity Securities, the following Transfers of shares of
Equity Securities shall be permitted (each, a “Permitted Transfer”):


 


(a)           Transfers
of Equity Securities other than Governance Preferred Stock by any
Securityholder to any Permitted Assignee of such Securityholder, and Transfers
of Governance Preferred Stock by Mr. Knafel and Mr. Willner upon
their death to any Permitted Assignee described in clause (b)(iii) of the
definition of Permitted Assignee, in each case whether or not such Permitted
Assignee is a Securityholder at the time of such Transfer, provided,
that such Permitted Assignee agrees in writing to become a party to this
Agreement, and provided  further, that the Transfer is not a
Prohibited Transfer and such Permitted Assignee delivers to the Company (i) an
opinion of counsel, which opinion and counsel shall be reasonably satisfactory
to the Company, to the effect that the Transfer does not fall within sub-clauses (u),
(v), (w), (x) or (y) of the definition of the term “Prohibited Transfer”, and (ii) a
certificate of the Transferor and the Transferee, to the effect that the
Transferee is a Permitted Assignee of the Transferor, and provided  further,
that any such Permitted Transferee shall take subject to the applicable proxies
provided in Section 11.


 


(b)           Transfers
of shares of Governance Preferred Stock to any Person, provided, in each
case, that (i) in the case of a proposed Transfer of Series A Voting
Preferred Stock, holders of a majority of the shares of Series B Voting
Preferred Stock consent to the Transfer, and in the case of a proposed Transfer
of Series B Voting Preferred Stock, holders of a majority of the shares of
Series A Voting Preferred Stock consent to the Transfer (provided,
that such consent shall not be required with respect to Transfers of Governance
Preferred Stock permissible under Section 1(d) or with respect to a
Transfer by Carlyle of Governance Preferred Stock to TC Group, L.L.C., a
Delaware limited liability company, or any investment entity that is an
Affiliate of and is directly or indirectly managed by TC Group, L.L.C., so long
as TC Group, L.L.C. remains an entity through which The Carlyle Group (as
commonly known) manages its investment funds), (ii) the Transferee agrees
in writing to become a party to this Agreement, and (iii) the Transfer is
not a Prohibited Transfer.


 


(c)           Transfers
by Carlyle in one or more transactions of no more than an aggregate of 33% of
the Series D Non-Voting Preferred Stock held by Carlyle on the date
hereof, or the equivalent thereof through the sale of equity in any direct or
indirect holding company (and, in the event of the dissolution of such holding
company, to the owners or investors in such holding company), to other
financial investors, including private equity investors, provided, in
each case, that (i) holders of a majority of the shares of Series A
Voting Preferred Stock consent to the identity of the Transferee (including the
identity of the owners of and investors in a holding company that is a
Transferee), which consent shall not be unreasonably withheld or delayed, (ii) no
such Transfer, whether of Series D Non-Voting Preferred Stock or equity of
any direct or indirect holding company, shall convey to the Transferee,
directly or indirectly, any rights


 


2





















 


specifically given to
Carlyle under this Agreement (as opposed to rights of Carlyle that arise simply
from its ownership of Series D Non-Voting Preferred Stock) unless approved
in writing by the holders of a majority of the shares of Series A Voting
Preferred Stock, (iii) the Transferee, if Series D Non-Voting
Preferred Stock is Transferred, agrees in writing to become a party to this
Agreement, or if other equity is Transferred, agrees in writing not to Transfer
such equity except in accordance with the terms of this Agreement, mutatis mutandis, and (iv) the Transfer is not a Prohibited
Transfer, and provided  further, that any such Transfer shall be
consummated within three months after the Effective Time.


 


(d)           Subject to
the penultimate paragraph of this Section 1, Transfers by Carlyle or SRK
and the SRK Related Parties of shares of Preferred Stock, or, in the event the
Transfer triggers the Final Reclassification or the Final Reclassification has
already occurred, of shares of Company Common Stock, to any Person if the
Transferring Securityholder (or Mr. Knafel (or in the event of Mr. Knafel’s
death or incapacity such that he is unable to act Mr. Knafel’s
Representative), in the case of a Transfer by SRK and the SRK Related Parties)
at such time has the right to cause a Sale or a Subsequent Sale pursuant to Section 4,
provided, that, (i) no Transfer of Governance Preferred Stock shall
be permitted under this Section 1(d) unless the Transfer triggers the
Final Reclassification or, after a Qualified IPO, the Transfer is made in
connection with a Subsequent Sale, (ii) unless the Transfer is in
connection with a Sale or a Subsequent Sale, the Transferee agrees in writing
to become a party to this Agreement or so much of this Agreement as shall
remain operative, and (iii) unless such Transfer triggers the Final
Reclassification or the Final Reclassification has already occurred, such
Transfer is not a Prohibited Transfer and the Transferee delivers to the
Company an opinion of counsel that the Transfer does not fall within
sub-clauses (u), (v), (w), (x) or (y) of the definition of “Prohibited Transfer”,
which opinion and counsel shall be reasonably satisfactory to the Company.  In the event of such a Transfer, the
Transferor shall be entitled to drag-along rights under Section 3 as and
to the extent therein provided, and other holders of Non-Voting Preferred Stock
and Eligible Series E Common Stock, or, if the Transfer triggers the Final
Reclassification or the Final Reclassification has already occurred, of Company
Common Stock, shall be entitled to the Tag-Along Rights described in Section 2.


 


(e)           Subject to
the penultimate paragraph of this Section 1, Transfers by Carlyle of Series D
Non-Voting Preferred Stock to any Person not otherwise permitted, provided,
that (i) the Transferee agrees in writing to become a party to this
Agreement, (ii) the Transfer is not a Prohibited Transfer and the
Transferee delivers an opinion of counsel to the Company, which opinion and
counsel shall be reasonably satisfactory to the Company, to the effect that the
Transfer does not fall within sub-clauses (u), (v), (w), (x) or (y) of the
definition of “Prohibited Transfer,” and (iii) holders of a majority of
the shares of Series A Voting Preferred Stock approve the identity of the
Transferee and the extent to which any rights specifically given to Carlyle
under this Agreement (as opposed


 


3





















 


to rights of Carlyle that
arise simply from its ownership of Series D Non-Voting Preferred Stock)
are proposed to be Transferred.  In the
event of such a Transfer, all other holders of Non-Voting Preferred Stock and
Eligible Series E Common Stock shall be entitled to the Tag-Along Rights
described in Section 2.


 


(f)            Transfers
of Company Common Stock by any Securityholder after a Qualified IPO, provided,
that (i) such Transfer is pursuant to an effective registration statement
under the Securities Act or is exempt from registration under Rule 144 and
(ii) such Transfer would not be a Prohibited Transfer under clause (z) of
the definition of Prohibited Transfer.


 


(g)           Transfers
by Carlyle or SRK and the SRK Related Parties of Company Common Stock after a
Sale or Subsequent Sale to any Person, and Transfers by Carlyle or SRK and the
SRK Related Parties of Company Common Stock after a Qualified IPO (other than
market sales, which are covered by Section 1(f) above) to any Person,
provided, that the Transferee agrees in writing to become a party to so
much of this Agreement as shall remain operative, and that the Transfer is not
a Prohibited Transfer.  In the event of
such a Transfer, Carlyle shall be entitled to the drag-along rights under Section 3
as and to the extent therein provided, and all Securityholders other than the
party making such Transfer shall be entitled to the Tag-Along Rights described
in Section 2.


 


Notwithstanding the
foregoing, (i) prior to the Final Reclassification (unless the Transfer
triggers the Final Reclassification), (A) Carlyle may not Transfer (x) more
than 33% of the Preferred Stock held by Carlyle as of the date hereof pursuant
to Section 1(d) or (y) more than 50% of the Preferred
Stock held by Carlyle as of the date hereof in the aggregate pursuant to Section 1(d) and
Section 1(e), and (B) SRK and the SRK Related Parties may not
Transfer more than 33% of the Preferred Stock held by SRK and the SRK Related Parties
as of the date hereof pursuant to Section 1(d), provided that
neither Carlyle nor SRK and the SRK Related Parties may Transfer any Preferred
Stock pursuant to Section 1(d) or Section 1(e) prior to the
third anniversary of the date of this Agreement unless such Transfer triggers
the Final Reclassification; (ii) after the fourth anniversary of the date
of this Agreement, SRK and the SRK Related Parties may not Transfer any shares
of Preferred Stock or Company Common Stock pursuant to Section 1(d) unless
both (A) either (1) Mr. Knafel (or in the event of Mr. Knafel’s
death or incapacity such that he is unable to act Mr. Knafel’s
Representative) has delivered the second notice contemplated by Section 4(a)(ii)(B) in
conformity therewith and nine months have elapsed or (2) Carlyle has
elected to pursue a Sale under Section 4(a)(ii)(A) and twelve months
have elapsed or (3) Carlyle has notified Mr. Knafel (or in the event
of Mr. Knafel’s death or incapacity such that he is unable to act Mr. Knafel’s
Representative) that it has not been able to effectuate a Sale or Qualifying
Distribution Transaction (because of the IRR Condition, market conditions,
contractual restrictions, or failure of closing conditions) and that it has not
been able to consummate a Qualified IPO (because


 


4





















 


of market
conditions) and/or does not intend to seek to effectuate a Qualified IPO and,
(B) such Transfer by SRK and the SRK Related Parties would, if it
triggered the Final Reclassification, satisfy the IRR Condition; (iii) no
Permitted Transfer that triggers the Final Reclassification may be consummated
unless (A) such Permitted Transfer results in the Transfer of all of the
Equity Securities held by SRK, the SRK Related Parties and MSW (if Carlyle is
the initial Transferor) or Carlyle (if SRK and the SRK Related Parties are the
initial Transferors), or (B) the buyer in such Permitted Transfer has
agreed to provide such Securityholder(s) in clause (A) that did not
initiate the Transfer with substantially equivalent rights with respect to the
Transfer of all of the Equity Securities to be retained by it or them after
consummation of such transaction as the initiating Securityholder(s) would
receive with respect to the Equity Securities that it or they would retain
after consummation of such transaction (provided, that such rights shall
not include the provision of drag-along rights to SRK, the SRK Related Parties
and MSW if Carlyle is the initial Transferor); and (iv) except in
connection with a Transfer that triggers the Final Reclassification or a
Subsequent Sale, a Securityholder may not Transfer any Equity Securities to any
Strategic Buyer or any Affiliate thereof without the prior written consent of Mr. Knafel
(or in the event of Mr. Knafel’s death or incapacity such that he is
unable to act Mr. Willner, or in the event of Mr. Willner’s death or
incapacity such that he is unable to act Mr. Knafel’s Representative) and
Carlyle.


 


Each Securityholder shall
give the Company at least 30 days’ prior written notice (or 10 days’ prior
written notice in the case of a Permitted Transfer described in Section 1(a))
of any proposed Transfer of any Equity Securities pursuant to a Permitted
Transfer described in this Section 1, and prompt notice of any such actual
Transfer.  Any Transfer of any Equity
Securities other than pursuant to a Permitted Transfer shall be void ab initio and of no effect. 
The Company agrees to provide such certificates with respect to factual
matters involving the Company as may be reasonably requested by a
Securityholder or its counsel in connection with a proposed Permitted
Transfer.  The Company shall cooperate
with any Securityholder seeking to Transfer Equity Securities as permitted pursuant
to this Section 1 and shall take all actions as may be reasonably
requested by such Securityholder to effectuate such Transfer.


 


Section 2.               Tag-Along
Rights.


 


If Carlyle, SRK or any of the SRK Related Parties (a “Section 2
Seller”) desires to Transfer any shares of Non-Voting Preferred Stock or of
Company Common Stock pursuant to (and in conformity with) Sections 1(d),
1(e), or 1(g), then such Section 2 Seller shall give notice (the “Notice
of Offer”) in writing to the Board and the other Securityholders (i) designating
the number of shares of each series of Non-Voting Preferred Stock or of Company
Common Stock that such Section 2 Seller proposes to sell, (ii) naming
the prospective purchaser thereof (the “Designated Purchaser”) and (iii) specifying
the price (the “Offer Price”) and terms (the “Offer Terms”) upon
which such Section 2 Seller desires to sell the same.  During the 20 Business Day period


 


5





















 


following
receipt of such Notice of Offer by the Company, the other Securityholders that
hold Non-Voting Preferred Stock, Eligible Series E Common Stock or Company
Common Stock, as the case may be, shall have the right (a “Tag-Along Right”),
exercised by delivering a written notice to the Section 2 Seller and the
Company, to require the Designated Purchaser to purchase from such
Securityholders (an “Accepting Securityholder”), at the Offer Price and
on the Offer Terms (subject to reducing the Offer Price by the amount of the
unsatisfied Participation Level for each share of Eligible Series E Common
Stock), a percentage of such Accepting Securityholder’s shares of Non-Voting
Preferred Stock, Eligible Series E Common Stock or shares of Company
Common Stock, as the case may be, that is less than or equal to the percentage
of the Section 2 Seller’s shares of Non-Voting Preferred Stock or shares
of Company Common Stock, as the case may be, that the Designated Purchaser
ultimately purchases from the Section 2 Seller in the transaction, provided,
Holdco shall have the right to require the Designated Purchaser to purchase
from Holdco the aggregate number of shares of Non-Voting Preferred Stock or
shares of Company Common Stock, as the case may be, that the Holdco Continuing
Investors elect and are entitled to sell in accordance with Section 8.9 of
the Holdco LLC Agreement in connection with the exercise of their tag-along
rights.  It shall be a condition to any
Transfer by the Section 2 Seller that the Designated Purchaser shall
purchase such shares from the Accepting Securityholders pursuant to and in
accordance with the applicable provisions of this Section 2, and, for the
avoidance of doubt, Transfers by Accepting Securityholders in conformity with
this Section 2 shall be permitted for all purposes under this Agreement.


 


Section 3.               Drag-Along
Rights.


 


(a)           Drag-Along
Notice.  In connection with a
Transfer by Carlyle or SRK and the SRK Related Parties pursuant to Section 1(d) or
a Transfer by Carlyle pursuant to Section 1(g), if, subject to the
penultimate sentence of this Section 3(a), Carlyle or SRK and the SRK
Related Parties (a “Section 3 Seller”) intends to Transfer Company
Common Stock (a “Drag-Along Sale”) to a non-Affiliate third party (a “Section 3
Buyer”) and elects to exercise its rights under this Section 3, such Section 3
Seller shall deliver written notice (a “Drag-Along Notice”) to the
Company and the other Securityholders, which notice shall (i) state (x) that
the Section 3 Seller wishes to exercise its rights under this Section 3
with respect to such Transfer, (y) the name and address of the Section 3
Buyer, and (z) the number of shares of Company Common Stock that
the Section 3 Seller proposes to sell (the “Section 3 Seller
Securities”) and the aggregate price and form of consideration the Section 3
Seller proposes to receive per share in the Drag-Along Sale, (ii) contain
(I) drafts of purchase and sale documentation setting forth the
terms and conditions of payment of such consideration and all other material
terms and conditions of such Transfer (the “Draft Sale Agreement”), and
(II) an offer (the “Drag-Along Offer”) by the Section 3
Buyer to purchase from the other Securityholders on the date of the closing of
such Transfer (a “Section 3 Closing”), a percentage of each such
Securityholder’s shares of Company Common Stock that is the


 


6





















 


same as the percentage of
the Section 3 Seller’s shares of Company Common Stock that the Section 3
Buyer purchases from the Section 3 Seller, and (iii) state the
anticipated time and place of such Section 3 Closing, which (subject to
such terms and conditions) shall occur not fewer than 15 days nor more than 120
days after the date such Drag-Along Notice is delivered, provided, that
if such Section 3 Closing shall not occur prior to the expiration of such
120-day period, the Section 3 Seller shall be entitled to deliver another
Drag-Along Notice with respect to such Drag-Along Offer.  The foregoing notwithstanding (A) no
Drag-Along Notice delivered by SRK and the SRK Related Parties shall be
effective unless (x) the transaction proposed by them would trigger the
Final Reclassification and (y) Mr. Knafel (or in the event of Mr. Knafel’s
death or incapacity such that he is unable to act Mr. Knafel’s
Representative) has approved such Drag-Along Notice, and (B) no Drag-Along
Notice delivered by Carlyle shall be effective (x) prior to the
Final Reclassification, unless the transaction proposed by it would trigger the
Final Reclassification, (y) following the consummation of a Qualified
IPO, unless Carlyle proposes to sell at least 85% of the Company Common Stock
held by it in the proposed transaction, or (z) following the
consummation of a Sale or Subsequent Sale, unless Carlyle proposes to sell all
of the Company Common Stock held by it in the proposed transaction.  Upon request of any Section 3 Seller,
the Company shall provide the Section 3 Seller with a current list of the
names and addresses of the other Securityholders.


 


(b)           Conditions
to Drag-Along.  Following delivery of a Drag-Along
Notice, each of the other Securityholders shall have the obligation to Transfer
all of its securities covered by the Drag-Along Notice (“Drag-Along
Securities”) pursuant to the Drag-Along Offer, as such offer may be
modified from time to time, provided, that the Section 3 Seller
Transfers all of its Section 3 Seller Securities (as so modified from time
to time) to the Section 3 Buyer at the Section 3 Closing and that all
shares comprising the Section 3 Seller’s Securities and shares comprising
the Drag-Along Securities are sold to the Section 3 Buyer at the same
price, for the same form of consideration (which shall be cash, Marketable
Securities or Other Eligible Sale Consideration or a combination thereof, or,
if an election to receive a different form of consideration is available, such
election is made available to each Securityholder), and on the same terms and
conditions, and provided  further, that (x) a
Securityholder shall only be required to make, in connection with a Drag-Along
Sale, (i) representations and warranties with respect to its authority,
its title to its Drag-Along Securities, the absence of conflicts, and approvals
and litigation relating to it, and (ii) such representations or warranties
with respect to the Company or its business, affairs, assets or liabilities as
are being made by the Section 3 Seller, (y) a Securityholder
shall not, in connection with a Drag-Along Sale, be required to indemnify the Section 3
Buyer or any other Person jointly with any other Person, nor to indemnify such Section 3
Buyer or other Person in respect of more than its pro rata share (based on the numbers of shares sold in the
Drag-Along Sale) of any matter relating to a breach of a representation or
warranty described in clause (x)(ii) above or of any indemnification
for breaches of representations and warranties made by the Company


 


7





















 


with respect to itself or
its business, affairs, assets or liabilities and (z) no
Securityholder shall be liable for any indemnification obligation in connection
with a Drag-Along Sale in excess of the aggregate amount received by such
Securityholder in such Drag-Along Sale. 
Within five Business Days prior to the date proposed for any Section 3
Closing, each of the other Securityholders shall (i) deliver to the Section 3
Seller a written instrument of Transfer covering such Securityholder’s
Drag-Along Securities, and (ii) execute and deliver to the Section 3
Seller a power of attorney and a letter of transmittal in favor of the Section 3
Seller, and in form and substance reasonably satisfactory to the Section 3
Seller appointing the Section 3 Seller as the true and lawful
attorney-in-fact and custodian for such other Securityholder, with full power
of substitution, and authorizing the Section 3 Seller to execute and deliver
a purchase and sale agreement substantially in the form of the then current
Draft Sale Agreement and otherwise in accordance with the terms of this Section 3(b) and
to take such actions as the Section 3 Seller may reasonably deem necessary
or appropriate to effect the sale and Transfer of the Drag-Along Securities to
the Section 3 Buyer, upon receipt of the purchase price therefor set forth
in the Drag-Along Notice at the Section 3 Closing, free and clear of all
security interests, liens, claims, encumbrances, options, and voting agreements
of whatever nature (other than securities laws restrictions), together with all
other documents delivered with such Drag-Along Notice and required to be
executed in connection with the sale thereof pursuant to the Drag-Along
Offer.  If, within 60 days after delivery
to the Section 3 Seller, the Section 3 Seller has not completed the
sale of all of the Section 3 Seller’s Securities owned by it and the
Drag-Along Securities owned by the other Securityholders to the Section 3
Buyer and another Drag-Along Notice with respect to such Drag-Along Offer has
not been sent to the other Securityholders, the Section 3 Seller shall
return to each other Securityholder all documents that such other
Securityholder delivered in connection with such sale.  Promptly after the Section 3 Closing,
the Section 3 Seller shall furnish such other evidence of the completion
and time of completion of such sale and the terms thereof as may reasonably be
requested by any of the other Securityholders. 
Each Securityholder shall bear its pro  rata share of
expenses borne by the Section 3 Seller or the Company related to the
Drag-Along Sale.  For the avoidance of
doubt, Transfers of Drag-Along Securities by Securityholders pursuant to and in
conformity with this Section 3 shall be permitted for all purposes under
this Agreement.


 


(c)           Remedies.  Each of the Securityholders acknowledges that
the Section 3 Seller would be irreparably damaged in the event of a breach
or a threatened breach by such other Securityholder of any of its obligations
under this Section 3 and each of the other Securityholders agrees that, in
the event of a breach or a threatened breach by such other Securityholder of
any such obligation, the Section 3 Seller shall, in addition to any other
rights and remedies available to it in respect of such breach, or a threatened
breach, be entitled to an injunction from a court of competent jurisdiction
(without any requirement to post bond) granting it specific performance by such
other Securityholder of its obligations under this Section 3.  In the event that the Section 3 Seller
shall file suit


 


8





















 


to enforce the covenants
contained in this Section 3 (or obtain any other remedy in respect of any
breach thereof), the prevailing party in the suit shall be entitled to recover,
in addition to all other damages to which it may be entitled, the costs
incurred by such party in conducting the suit, including reasonable attorney’s
fees and expenses.


 


Section 4.               Exit
Transactions and Procedures.


 


(a)           IPO,
Sale or Recapitalization of the Company.


 


(i)            Carlyle
Rights.  Notwithstanding anything
herein to the contrary, at any time following the third anniversary of the date
of this Agreement, Carlyle may cause the Company to:


 


(A)          commence
a Qualified IPO;


 


(B)           implement
a sale, merger, consolidation, reclassification or like transaction, the
consideration for which must be either cash, Marketable Securities or Other
Eligible Sale Consideration or a combination thereof, either (i) that
would trigger the Final Reclassification (in any such case, a “Sale”), (ii) following
a Qualified IPO and as a result of which at least 85% of the shares of Final
Reclassification Stock (excluding shares held by shareholders who are not
Securityholders under this Agreement) would be converted into or exchanged for
cash, Marketable Securities or Other Eligible Sale Consideration or a
combination thereof or (iii) following a Sale and as a result of which all
of the shares of Final Reclassification Stock (excluding shares held by the
purchasers in the Sale and their transferees) would be converted into or
exchanged for cash, Marketable Securities or Other Eligible Sale Consideration
or a combination thereof (each of the transactions described in clauses (ii) and
(iii) of this Section 4(a)(i)(B), a “Subsequent Sale”); or


 


(C)           effect
a recapitalization and distribution transaction (or a distribution whether or
not financed) (a “Recap”), in which cash is distributed (i) if the
transaction is consummated prior to the Final Reclassification, pro rata in respect of the shares of Non-Voting
Preferred Stock and (if and to the extent they are entitled to so participate
under Article Seven of the Charter) the shares of Series E Common
Stock (it being understood that such Recap would be subject to Section 7.2
of the Charter, and, accordingly, unless consented to by the holders of the Series F
Common Stock (or proxies thereof), no Recap under this clause (i) may be
consummated if the amount distributed would, if distributed by the Company in a
liquidation under Article Seven of the Charter, be sufficient to cause any
distribution to be made in respect of the Series F Common Stock) and (ii) if
the transaction is consummated following the Final Reclassification, pro rata in respect of the shares of Company
Common Stock.


 


9





















 


(ii)           Mr. Knafel’s
Rights.  At any time following the
fourth anniversary of the date of this Agreement, Mr. Knafel (or in the
event of Mr. Knafel’s death or incapacity such that he is unable to act Mr. Knafel’s
Representative) may on one occasion (subject to the other provisions of this Section 4(a)(ii) and
to Mr. Knafel’s (or such representative’s) rights to deliver a subsequent
such request in certain circumstances if no transaction has resulted from prior
ones, as hereinafter set forth), deliver a request (a “Liquidity Request”)
to Carlyle setting forth Mr. Knafel’s (or in the event of Mr. Knafel’s
death or incapacity such that he is unable to act Mr. Knafel’s
Representative’s) interest in causing the Company to effect a Sale or a
Qualified IPO (each, a “Company Liquidity Event”) or a Recap or other
distribution or like transaction as a result of which SRK and the SRK Related
Parties would receive distributions or non-recourse loans of cash in an amount
that, together with the amount of all proceeds and distributions theretofore
received by SRK and the SRK Related Parties (collectively “Prior Proceeds”)
in respect of their Equity Securities, equals two thirds of the sum of (x) the
Fair Market Value of the Equity Securities of SRK and the SRK Related Parties
at the time of such transaction and (y) the amount of the Prior
Proceeds (such Recap or other distribution or like transaction, a “Qualifying
Distribution Transaction”).  No
Liquidity Request may be delivered if the Company has theretofore consummated a
Company Liquidity Event or a Qualifying Distribution Transaction, provided,
if SRK and the SRK Related Parties are not able to sell their Equity Securities
in connection with or following a Qualified IPO without such Transfer(s) being
a Prohibited Transfer under clause (z) of the definition of Prohibited
Transfer, then a Qualified IPO shall not constitute a Company Liquidity Event.


 


(A)          Within
365 days of the receipt of a validly delivered Liquidity Request, Carlyle shall
notify Mr. Knafel (or in the event of Mr. Knafel’s death or
incapacity such that he is unable to act Mr. Knafel’s Representative) of
its election (in its discretion) to cause the Company to commence the process
of seeking to effectuate either a Qualifying Distribution Transaction, a
Qualified IPO or a Sale; and Carlyle and the Company shall thereafter use their
respective reasonable best efforts to consummate whichever of such transactions
Carlyle so elected as expeditiously as possible consistent with market
conditions and then-existing debt covenants and other contractual restrictions;
provided, that Carlyle and the Company shall have no obligation to
consent to, negotiate or execute documentation that would effectuate a Sale
(and none of SRK, any SRK Related Party or the Company shall execute
documentation in respect of or consummate a Sale without Carlyle’s consent)
unless the consideration to be received by Carlyle in respect of the shares of Series D
Preferred Stock or Company Common Stock owned by Carlyle at the time would
generate a Carlyle IRR in excess of 9% (the “IRR Condition”) (it being
understood and agreed that (x) Carlyle may not invoke the IRR Condition
to prevent a Sale pursuant to a definitive agreement for a Sale that has been
executed and delivered by the Company or the stockholders and the buyer with
Carlyle’s consent, (y) subject to Mr. Knafel’s (or in the event of Mr. Knafel’s
death or incapacity such that he is unable to act Mr. Knafel’s


 


10





















 


Representative) right to
renew his request under Section 4(a)(i)(E) below, Carlyle shall have
no obligation to select a Qualified IPO if a Sale would not satisfy the IRR Condition
and (z) Carlyle shall have no obligation to pursue a Qualifying
Distribution Transaction if such transaction would require the Company to
refinance a material amount of its indebtedness or seek amendments in respect
thereof that would have significant costs). 
The Carlyle IRR shall be calculated based upon an estimated closing date
for such Sale mutually agreed to in good faith by Carlyle and Mr. Knafel
(or in the event of Mr. Knafel’s death or incapacity such that he is
unable to act Mr. Knafel’s Representative) prior to the execution of any
definitive agreements.


 


(B)           If,
in response to a Liquidity Request, Carlyle elects to commence the process of
seeking to effectuate either a Qualifying Distribution Transaction or a
Qualified IPO and no such transaction is consummated (or, if consummated, the
Qualified IPO does not constitute a Company Liquidity Event by operation of the
proviso in the last sentence of Section 4(a)(ii)) within the later of six
months of Carlyle’s election or 12 months of the delivery of the Liquidity
Request, Mr. Knafel (or in the event of Mr. Knafel’s death or
incapacity such that he is unable to act Mr. Knafel’s Representative) may
deliver a second notice requiring Carlyle and the Company to commence the
process of seeking to effectuate a Sale (subject to the IRR Condition).


 


(C)           In
the event a Liquidity Request is to be satisfied with a Qualifying Distribution
Transaction, the Fair Market Value of the Equity Securities of SRK and the SRK
Related Parties at the time of the applicable transaction shall be determined
as promptly as practicable in accordance with Section 4(a)(iv).  If Mr. Knafel (or in the event of Mr. Knafel’s
death or incapacity such that he is unable to act Mr. Knafel’s
Representative) in his sole discretion is not satisfied with such amounts, Mr. Knafel
(or such representative) may withdraw his Liquidity Request and shall be
entitled to initiate a subsequent Liquidity Request, provided, that Mr. Knafel
(or such representative) shall not make such subsequent Liquidity Request for a
period of 6 months after the withdrawal of the prior Liquidity Request.


 


(D)          In
the event a Liquidity Request is to be satisfied with a Qualifying Distribution
Transaction, SRK and the SRK Related Parties may be paid, and each of them hereby
agrees to receive, to the extent it would not violate Applicable Law, some or
all of their shares of the proceeds in the form of a non-interest bearing
advance on future distributions or a non-recourse loan (the “Non-Recourse
Loans”), secured by their respective Equity Securities.  Any Non-Recourse Loans shall be mandatorily
prepayable out of any proceeds received by the obligors thereunder in respect
of Equity Securities and the Company shall be entitled to set off any such
proceeds against such Non-Recourse Loans, but in no event will the obligor be
liable for any deficiency.


 


11





















 


(E)           If,
in the event either that Carlyle elects to attempt to satisfy a Liquidity
Request through a Sale or that Mr. Knafel (or in the event of Mr. Knafel’s
death or incapacity such that he is unable to act Mr. Knafel’s
Representative) gives the second notice contemplated by subparagraph (B) above
and, in any such case, a Sale is not consummated because of the IRR Condition
or market conditions or the failure of a condition to the pertinent
documentation, Mr. Knafel (or in the event of Mr. Knafel’s death or
incapacity such that he is unable to act Mr. Knafel’s Representative)
shall have the right to renew his Liquidity Request until it is satisfied, but
no sooner than 6 months after the conclusion of the previous process.


 


(iii)          Carlyle
and Mr. Knafel’s Rights.  Prior
to the third anniversary of the date of this Agreement, either Carlyle or Mr. Knafel
(or in the event of Mr. Knafel’s death or incapacity such that he is
unable to act Mr. Knafel’s Representative) may cause the Company to
execute definitive documentation to effect a Sale, if, and only if,
the Fair Market Value of the aggregate consideration to be received in respect
of a share of Series D Non-Voting Preferred Stock (or in respect of the
number of shares of Company Common Stock into which a share of Series D
Non-Voting Preferred Stock is converted in the Final Reclassification) plus the
Fair Market Value of any Equity Securities retained by the selling
Securityholders in such Sale, together with the Fair Market Value of the
aggregate amount of all distributions theretofore made by the Company in
respect of a share of Series D Non-Voting Preferred Stock, is equal to at
least 2.0 times the aggregate initial subscription price for a share of Class D
Preferred Stock pursuant to Section 1.2 of the Exchange Agreement (which
amount is $11.75) (the “Valuation Test”).  For purposes of this Section 4(a)(iii),
any escrow or like arrangement securing indemnification obligations or
contingent liabilities that is part of the Sale consideration (including any
note other than one that is expressly not subject to a set-off or similar right
by the purchaser in respect of indemnification obligations or other contingent
liabilities), as permitted by this Agreement, shall be valued at its Fair
Market Value in accordance with Section 4(a)(iv)(B).  If either Carlyle or Mr. Knafel (or in
the event of Mr. Knafel’s death or incapacity such that he is unable to
act Mr. Knafel’s Representative) desires to effect a Sale pursuant to this
Section 4(a)(iii) and obtains written advice from a nationally
recognized investment bank to the effect that the Valuation Test is reasonably
likely to be satisfied in the transaction, and if an Exit Notice (as defined in
the Partnership Agreement) has not yet been given, such party shall have the
right, subject to the terms of the Partnership Agreement, to cause the Company
to deliver, in accordance with the terms of Article 9 of the Partnership
Agreement, such an Exit Notice in order to initiate a split-up of the
Partnership (a “Partnership Split-Up”). 
Following or in connection with a Partnership Split-Up so initiated,
either Carlyle or Mr. Knafel (or in the event of Mr. Knafel’s death
or incapacity such that he is unable to act Mr. Knafel’s Representative)
may cause the Company to execute definitive documentation to effect a Sale in
accordance with this paragraph even if the Valuation Test as defined would not
be satisfied so long as an identical test using a multiplier of 1.75 times
would be satisfied.


 


12





















 


(iv)          Fair
Market Value.  The “Fair Market
Value” of any assets or securities required to be determined hereunder shall
be the value determined consistent with the principles and provisions hereof by
agreement of Mr. Knafel (or in the event of Mr. Knafel’s death or
incapacity such that he is unable to act Mr. Knafel’s Representative) and
Carlyle or, failing such agreement within ten days after a request by either
party to reach such determination in connection with any provision hereof, by a
nationally recognized investment bank (a “Qualified Bank”) to be
mutually agreed to by Mr. Knafel (or in the event of Mr. Knafel’s death
or incapacity such that he is unable to act Mr. Knafel’s Representative)
and Carlyle, provided, that in the event Mr. Knafel (or in the
event of Mr. Knafel’s death or incapacity such that he is unable to act Mr. Knafel’s
Representative) and Carlyle are unable to agree upon a Qualified Bank to make
such valuation within ten days after any failure to reach agreement on the Fair
Market Value of assets or securities, Mr. Knafel (or in the event of Mr. Knafel’s
death or incapacity such that he is unable to act Mr. Knafel’s
Representative) and Carlyle shall each promptly select a Qualified Bank, which
Qualified Banks shall, acting together, promptly select a third Qualified Bank
to make such valuation (the “Valuer”). 
The costs of the Valuer shall be borne by the Company.  The determination of Carlyle and Mr. Knafel
(or in the event of Mr. Knafel’s death or incapacity such that he is
unable to act Mr. Knafel’s Representative) by mutual agreement, or of the
Valuer, shall be final and binding on the parties.


 


(A)          The Fair Market Value per share of publicly
traded stock shall be equal to a price per share equal to the average of the
daily volume-weighted average prices per share of such stock for each of the 20
trading days preceding the second date preceding the date as of which the
valuation is being determined (as reported by Bloomberg using the VWAP
function, or if unavailable by another authoritative source, or if no other
authoritative source is available, based on the average of the daily closing
prices (instead of the daily volume-weighted average prices) for such 20
trading days, as reported by Bloomberg or another authoritative source).


 


(B)           The
Fair Market Value of any escrow or like arrangement  (including any note payable by a purchaser
other than one that is expressly not subject to a set-off or similar right in
respect of indemnification obligations or other contingent liabilities) shall
be determined using customary and current valuation concepts and techniques
(taking into account the likely amount and likely timing of any payment in
respect thereof) based on the assumption that such escrow or arrangement is
consideration in a transaction agreed to on an arm’s-length basis between a
willing buyer and a willing seller, provided, that Section 4(a)(iv)(E)(1) and
Section 4(d)(ii) shall apply in lieu of this paragraph to any
valuations of such escrows or like arrangements for purposes of calculating the
Final Reclassification.


 


13





















 


(C)           The
Fair Market Value of non-public securities (including a note payable by a
purchaser if such note is expressly not subject to a set-off or similar right
in respect of indemnification obligations or other contingent liabilities) or
other assets, excluding the matters covered by paragraph (B) of this Section 4(a)(iv),
shall be determined using customary and current valuation concepts and
techniques based on the assumption that the securities or assets being valued
are sold in a transaction agreed to on an arm’s-length basis between a willing
buyer and a willing seller.


 


(D)          The
Fair Market Value of any specific Equity Securities of the Company at any date
shall be an amount equal to the amount that would be distributed in respect of
such Equity Securities under Article Seven of the Charter if an amount
equal to the aggregate Fair Market Value of all of the Equity Securities were
distributed under such Article Seven in complete liquidation of the
Company.


 


(E)           For
purposes of subparagraph (D) above, the aggregate Fair Market Value of all
of the Equity Securities of the Company shall be determined based upon the
following:


 


(1)           If
the value is being determined in connection with a Sale, the aggregate Fair
Market Value of all of the Equity Securities of the Company shall be equal to
the Fair Market Value of the aggregate consideration payable to the selling
Securityholders in such Sale in respect of the equity of the Company (including
the Fair Market Value of any note that expressly is not subject to a set-off or
similar right by the purchaser in respect of indemnification obligations or
other contingent liabilities), reduced by expenses related to the Sale, plus
the Fair Market Value of any Equity Securities retained by the selling
Securityholders in such Sale, provided, that for purposes of determining
the distribution of shares of Final Reclassification Stock, any escrow or like
arrangement securing indemnification obligations or contingent liabilities that
is part of the Sale consideration (including any note other than one that is expressly
not subject to a set-off or similar right by the purchaser in respect of
indemnification obligations or other contingent liabilities), as permitted by
this Agreement, shall be deemed to have a value of zero and shall be taken into
account only as contemplated by Section 4(d)(ii), and provided  further,
that for such purposes the Fair Market Value of any publicly traded stock to be
paid as consideration shall be the Fair Market Value (as determined in the
manner set forth in paragraph (A) of this Section 4(a)(iv)) of the
publicly traded stock that would be payable to the selling Securityholders in
accordance with the definitive agreement with respect to such Sale if the Sale
were consummated on the same date on which such agreement enters into force, except
that if the definitive agreement with respect to such Sale specifies an agreed
dollar value for such publicly traded stock, the Fair Market


 


14





















 


Value of such stock shall
be deemed to be the amount specified in such agreement.


 


(2)           If
the value is being determined in connection with a Qualified IPO and the
managing underwriters or the Valuer have determined that the public market
value of the Company will not be materially less than its private market value,
the aggregate Fair Market Value of all of the Equity Securities of the Company
shall be equal to the aggregate equity value of the Company implied by a price
per public share equal to the average of the daily volume-weighted average
prices per share for each of the 20 trading days preceding the 60th
day following the closing of the Qualified IPO (as reported by Bloomberg using
the VWAP function, or if unavailable, by another authoritative source, or if no
other authoritative source is available, based upon the average of the daily
closing prices (instead of the daily volume-weighted average prices) for such
20 trading days, as reported by Bloomberg or another authoritative source).


 


(3)           If
the value is being determined under circumstances where neither subparagraph (1) nor
subparagraph (2) above applies, the aggregate Fair Market Value of all of
the Equity Securities of the Company shall be equal to the fair market value of
all of the equity of the Company, determined using customary and current
valuation concepts and techniques and other factors deemed relevant by Mr. Knafel
(or in the event of Mr. Knafel’s death or incapacity such that he is
unable to act Mr. Knafel’s Representative) and Carlyle, or by the Valuer,
as the case may be.


 


(b)           Partnership
Split-Up.  Notwithstanding anything
herein to the contrary, at any time following the third anniversary of the date
of this Agreement, Carlyle may cause the Company to initiate a Partnership
Split-Up.  In the event of the
consummation of a Partnership Split-Up, whether such Partnership Split-Up was
initiated pursuant to Section 4(a)(iii), this Section 4(b) or
otherwise, the parties shall effect a recapitalization in which the Series A
Voting Preferred Stock and the Series B Voting Preferred Stock are retired,
and the composition of the Board and the voting power of the Securityholders is
adjusted (and the Charter appropriately amended) so as to reflect as closely as
reasonably practicable the economic interests in the Company of the Series A
Securityholders and Carlyle, (it being understood and agreed that the parties
shall take such steps as may be necessary to permit the Series A
Securityholders to elect one member of the Board for so long as the Final
Reclassification shall not have occurred and the Series A Securityholders
continue to hold at least 25% of the issued and outstanding Series C Non-Voting
Preferred Stock, it being further understood and agreed that, for so long as Mr. Willner
serves as the chief executive officer of the Company, if the Series B
Securityholders are entitled to elect a majority of the members of the Board
under this paragraph they shall cause Mr. Willner to be elected to serve
on the Board, and it being further understood and agreed that this right shall
not limit Carlyle’s authority to increase


 


15





















 


the size of the Board),
and provided, further, that if no such recapitalization has been
effected within 60 days of the consummation of the Partnership Split-Up,
Carlyle shall have the right to purchase all outstanding shares of Series A
Voting Preferred Stock from the holders thereof for a price equal to its par
value per share.  Simultaneously with the
execution of this Agreement, Mr. Knafel, the SRK Related Parties and Mr. Willner
are delivering to Carlyle (and, at the time of any Transfer of Series A
Voting Preferred Stock pursuant to Section 1(a), the Permitted Assignee
will deliver to Carlyle) executed stock powers for such a Transfer.  Carlyle agrees not to attempt to make the
purchase contemplated by such documentation except under the circumstances
herein set forth.


 


(c)           Control
of Process.  Notwithstanding anything
herein to the contrary:


 


(i)            At any
time following the earlier of (x) the third anniversary of the date
of this Agreement and (y) the date on which a Partnership Split-Up
is initiated other than by the Company, Carlyle shall control, and make all
decisions regarding, the process of a Sale, Qualified IPO, Recap or Partnership
Split-Up (including, but not limited to, with respect to a Partnership
Split-Up, the separation of Partnership assets, the election of groups of
Partnership assets, the timing, and the hiring of advisors, as appropriate, and
with respect to a Sale, Qualified IPO or Recap, the selection of buyers, the timing
and hiring of advisors, the pricing, the terms and conditions of the
transaction, the sale of any assets in connection with a Sale, and the drafting
of documentation (the “Principal Decisions”)).  The Principal Decisions shall be made in
accordance with any applicable limitations contained in this Agreement (for
example, the limitations on Other Eligible Sale Consideration set forth in the
definition of such term).  To effectuate
the forgoing, the parties shall cause there to be designated a committee of the
Board, comprised of three Carlyle representatives and two representatives
selected by a majority in interest of the Series A Securityholders, to
make all such decisions and take all related actions required by the Board.


 


(ii)           At any
time when subparagraph (i) above does not apply, the Board shall control,
and make all decisions regarding, the process of a Sale, Qualified IPO, Recap
or Partnership Split-Up (including, but not limited to, the Principal
Decisions).


 


(iii)          In
connection with decisions pursuant to this Section 4(c), Carlyle and the
Board shall cooperate fully and in good faith, Carlyle shall consult with the Series A
Securityholders in good faith and keep the Series A Securityholders
informed of the status of the transaction, and Carlyle, the Board and the Series A
Securityholders shall use their commercially reasonable efforts to ensure that
the process is fair to such parties.  In
addition, in connection with any Sale or Subsequent Sale as a result of which
Carlyle, SRK, the SRK Related Parties and MSW continue to own Company Common
Stock, the terms of such Sale or Subsequent Sale shall provide that each of
Carlyle, SRK, the SRK Related Parties and MSW will have substantially
equivalent rights with respect to the Transfer of all of the Equity Securities
to be retained by them after consummation of such


 


16





















 


transaction (provided, that such rights shall not include the
provision of drag-along rights to SRK, the SRK Related Parties and MSW).


 


(d)           Final
Reclassification.


 


(i)            Generally.  Either (x) in connection with and
immediately prior to effecting (A) a sale, merger, consolidation,
reclassification or like transaction in which the aggregate amount of cash,
Marketable Securities and Other Eligible Sale Consideration to be received by
the holders of all Equity Securities, together with the amount of all
distributions theretofore received in respect of Equity Securities, would be
greater than 90% of the sum of (I) the aggregate Fair Market Value
of all Equity Securities and (II) the aggregate amount of such
distributions theretofore received (provided, that the aggregate amount
of cash, Marketable Securities and Other Eligible Sale Consideration to be
received by the holders of all Equity Securities pursuant to such sale, merger,
consolidation, reclassification or like transaction shall be greater than 80%
of the aggregate Fair Market Value of all Equity Securities), or (B) a
Qualified IPO, or (y) if Carlyle and the holders of a majority of
the Series F Common Stock (or proxies thereof) so require, the Company
shall effect the Final Reclassification. 
In such transaction there shall be distributed to each Securityholder,
in exchange for such Securityholder’s Equity Securities, that number of shares
of Final Reclassification Stock which bears the same relationship to the
aggregate number of shares of Final Reclassification Stock as the Fair Market
Value of such Equity Securities bears to the aggregate Fair Market Value of all
of the Equity Securities, less the number of shares, if any, of Final
Reclassification Stock previously distributed to such Securityholder in
connection with an Initial Secondary Offering pursuant to Section 4(e).  Shares of Final Reclassification Stock
received in respect of unvested Equity Securities shall remain subject to the
same vesting terms to the extent vesting does not accelerate as a result of the
applicable transaction by operation of the then applicable vesting terms, but
such unvested Equity Securities shall be considered issued and outstanding for
purposes of determining the number of shares of Final Reclassification Stock to
be distributed to each Securityholder. 
The Company may not effect the Final Reclassification except as provided
in clauses (x) or (y) of this Section 4(d)(i).


 


(ii)           Escrow
or Similar Arrangement.  If a Final
Reclassification occurs in connection with a Sale in which any portion of the
aggregate consideration is paid into escrow, or any like arrangement securing
indemnification obligations or contingent liabilities is put into place
(including any purchaser note other than one that is expressly not subject to a
set-off or similar right by the purchaser in respect of indemnification
obligations or other contingent liabilities), in each case if and as permitted
by this Agreement, the value of such escrow or arrangement (including any
purchaser note other than one that is expressly not subject to a set-off or
similar right by the purchaser in respect of indemnification obligations or
other contingent liabilities) shall not be taken into account in determining
the distribution of shares of Final Reclassification Stock by


 


17





















 


virtue of Section 4(a)(iv)(D)(1).  However, at such time or times as any cash or
Marketable Securities shall be payable to the holders of Equity Securities in
respect of such escrow or arrangement (including any purchaser note other than
one that is expressly not subject to a set-off or similar right by the
purchaser in respect of indemnification obligations or other contingent
liabilities), such consideration shall be distributed among the Persons who
were holders of Equity Securities at the time the closing of the Sale occurred
in such amounts and proportions as shall cause each such holder to receive that
portion of the additional consideration as would have been distributed to such
holder in accordance with Section 7.1 of the Charter, as in effect
immediately prior to the closing of the Sale before giving effect to the Final
Reclassification (and, for avoidance of doubt, without giving effect to Section 7.3(c) of
the Charter), assuming for purposes of the internal rate of return calculations
contemplated thereby that such additional consideration is paid to such holders
on the date that such proceeds are available for distribution to such holders
and that consideration previously paid to such holders was paid to such holders
on the date that such proceeds were actually received.  The Charter shall be amended if and as
necessary to implement the foregoing. 
Any interest or income earned in respect of such escrow or arrangement
(including any purchaser note other than one that is expressly not subject to a
set-off or similar right by the purchaser in respect of indemnification
obligations or other contingent liabilities) shall be taken into account in the
same manner as principal and distributed accordingly in the same proportions.


 


(iii)          Qualified IPO.


 


(A)          If
a Final Reclassification occurs in connection with a Qualified IPO and the Board
reasonably determines, in good faith, that a change of control under an
indenture or credit agreement to which the Company or any of its Subsidiaries
is a party or a transfer of control under the Partnership Agreement would
reasonably be expected to have material adverse consequences for the Company,
then the Company shall reclassify its Equity Securities immediately prior to
the consummation of the Qualified IPO in order to create a class of
super-voting common stock that will be held by the Series A Securityholders
and the former holders of the Series B Voting Preferred Stock (the “Series B
Securityholders”) (convertible into ordinary common stock on a one-for-one
basis) and that will allow the Series A Securityholders to cast a majority
of the votes of the Company’s Equity Securities at any meeting of the Company’s
stockholders after the consummation of the Qualified IPO; provided that
the Series A Securityholders shall agree to exercise such control in a
manner so as to replicate as closely as possible the arrangements described in
the Charter as in effect immediately prior to the Qualified IPO (including in
particular the consent rights of the Series B Securityholders) and shall
vote their shares so as to cause an appropriately-adjusted number of directors
(consistent with majority control and independence requirements), which shall
be at least one, nominated by a majority


 


18





















 


in interest of the Series B
Securityholders to be elected to the Board; provided further that the Series A
Securityholders may only convert such number of their super-voting common
shares into ordinary common shares as would not result in a change of control
or transfer of control that is the subject of the Board’s determination.  Notwithstanding the foregoing, if the Company’s
Independent Directors determine that the circumstances that would have
reasonably been expected to have material adverse consequences for the Company
referred to in the preceding sentence in the event of such a change of control
or transfer of control have ceased to exist, then the Series A
Securityholders shall convert a sufficient number of the shares of super-voting
common stock held by them into ordinary common stock to give the Series B
Securityholders the ability to cast the majority of the votes of the Company’s
Equity Securities at any meeting of the Company’s stockholders; provided
that the Series B Securityholders shall vote their shares so as to cause
an appropriately-adjusted number of directors (consistent with majority control
and independence requirements), which shall be at least one, nominated by a
majority in interest of the Series A Securityholders to be elected to the
Board and to cause Mr. Willner to be elected to the Board so long as he
serves as chief executive officer of the Company (it being understood and
agreed that the foregoing obligations of the Series B Securityholders
shall not limit the Series B Securityholders’ authority to cause the size
of the Board to be increased); and provided further, that if the Series B
Securityholders Transfer or have Transferred (other than to a Permitted
Assignee) 50% or more of the Series D Non-Voting Preferred Stock (or
Equity Securities into which such stock may be converted) held by them as of
the date hereof, the Series B Securityholders shall convert all of the
shares of the super-voting common stock held by them into ordinary common
stock.


 


(B)           If
a Final Reclassification occurs in connection with a Qualified IPO, the Board
has not made the determination described in the first sentence of paragraph (A) of
this Section 4(d)(iii) and the managing underwriters have advised the
Company that in their opinion the Company may create equity arrangements that
will allow the Securityholders controlling the Company immediately prior to the
consummation of the Qualified IPO to maintain such control after the
consummation of the Qualified IPO without having an adverse effect on the
consummation of the Qualified IPO or the price of the Company Common Stock to
be sold therein, then the Company shall reclassify its Equity Securities
immediately prior to the consummation of the Qualified IPO in order to create a
class of super-voting common stock that will be held by the Series A
Securityholders and the Series B Securityholders (convertible into
ordinary common stock on a one-for-one basis) and will allow the Series B
Securityholders to cast a majority of the votes of the Company’s Equity
Securities at any meeting of the Company’s stockholders after the consummation
of the Qualified IPO; provided that the Series B Securityholders
shall vote their shares so as to cause an


 


19





















 


appropriately-adjusted
number of directors (consistent with majority control and independence requirements),
which shall be at least one, nominated by a majority in interest of the Series A
Securityholders to be elected to the Board and to cause Mr. Willner to be
elected to the Board so long as he serves as chief executive officer of the
Company (it being understood and agreed that the foregoing obligations of the Series B
Securityholders shall not limit the Series B Securityholders’ authority to
cause the size of the Board to be increased); and provided further, that
if the Series B Securityholders Transfer or have Transferred (other than
to a Permitted Assignee) 50% or more of the Series D Non-Voting Preferred
Stock (or Equity Securities into which such stock may be converted) held by
them as of the date hereof, the Series B Securityholders shall convert a
sufficient number of shares of the super-voting common stock held by them into
ordinary common stock to give the Series A Securityholders the ability to
cast the majority of the votes of the Company’s Equity Securities at any
meeting of the Company’s stockholders; and provided  further, that
if the Series A Securityholders Transfer or have Transferred (other than
to a Permitted Assignee) 50% or more of the Series C Non-Voting Preferred
Stock (or Equity Securities into which such stock may be converted) held by
them as of the date hereof, the Series A Securityholders shall convert all
of the shares of the super-voting common stock held by them into ordinary
common stock.


 


(C)           If
a Final Reclassification occurs in connection with a Qualified IPO, the Board has
not made the determination described in the first sentence of paragraph (A) of
this Section 4(d)(iii) and the managing underwriters have not advised
the Company that in their opinion the Company may create equity arrangements
that will allow the Securityholders controlling the Company immediately prior
to the consummation of the Qualified IPO to maintain such control after the
consummation of the Qualified IPO without having an adverse effect on the
consummation of the Qualified IPO or the price of the Company Common Stock to
be sold therein, then no such equity arrangements shall be put in place prior
to the consummation of the Qualified IPO.


 


(iv)          In
connection with a Final Reclassification, any deferred shares of Non-Voting
Preferred Stock will be adjusted so that the holder thereof receives Company
Common Stock when the deferral period ends.


 


(v)           Attached
to this Agreement as Schedule 4(d) for illustrative purposes
only are example calculations illustrating how the Final Reclassification is
intended to operate under the various scenarios described therein.  Such Schedule 4(d) shall not amend
or modify any provision of the text of Agreement, and the text of this
Agreement shall control in the event of any inconsistency.


 


20





















 


(e)           Qualified
IPO Procedures.


 


(i)            If a
Qualified IPO is triggered pursuant to Section 4(a)(i) or Section 4(a)(ii),
the Company shall consult with the managing underwriters to determine whether a
secondary offering of Company Common Stock held by the Securityholders (an “Initial
Secondary Offering”) may be conducted in connection with the sale of
Company Common Stock by the Company in the Qualified IPO without having a
material adverse effect on the consummation of the Qualified IPO or the price
of the Company Common Stock to be sold in the Qualified IPO and, if such
offering may be conducted, the estimated maximum size of such offering.  The Company shall instruct the managing
underwriters that the Securityholders wish to maximize the number of shares
that may be offered in an Initial Secondary Offering subject to the constraints
set forth in the preceding sentence.  The
Company shall promptly give written notice (the “Secondary Notice”) to
the Securityholders if the managing underwriters advise that an Initial
Secondary Offering may be conducted.


 


(ii)           Promptly
after delivery of the Secondary Notice, the Board shall make a good faith
estimate of the minimum number of shares of Final Reclassification Stock that
each holder of Equity Securities would receive in the Final Reclassification (a
holder’s “Estimated Final Reclassification Amount”).  Any Securityholder entitled to participate as
a selling Securityholder in the Qualified IPO pursuant to Section 5(a) shall
have the right to request that the Company advance to it, to allow it so to
participate, a number of shares of Company Common Stock not greater than 50% of
such Securityholder’s Estimated Final Reclassification Amount, provided,
that, if such registration is a Qualified IPO that has been triggered pursuant
to a Liquidity Request by Mr. Knafel (or in the event of Mr. Knafel’s
death or incapacity such that he is unable to act Mr. Knafel’s
Representative), additional shares will be advanced to SRK and the SRK Related
Parties to allow them to sell the maximum number of shares that they would be
entitled to sell under the priority provisions of Section 5(c)(i), unless
and to the extent that the Board determines in good faith that the advancement
of additional shares would present a material risk of exceeding the maximum
number of shares that they would receive in the Final Reclassification.


 


(iii)          Immediately
prior to the consummation of the Qualified IPO and the Initial Secondary
Offering, the Company shall issue to each Securityholder participating in the
Initial Secondary Offering the shares of Final Reclassification Stock to be
sold by such Securityholder in such offering, provided, the Company
shall issue to Holdco the shares of Final Reclassification Stock to be sold by
such Securityholder on behalf of the Holdco Continuing Investors in accordance
with their elections under Section 8.12 of the Holdco LLC Agreement.


 


(f)            Voting
and Securityholder Cooperation.  In
connection with any transaction contemplated hereunder, including a Sale, a Subsequent
Sale, a Qualified


 


21





















 


IPO, an Initial Secondary
Offering, the Final Reclassification, a Qualifying Distribution Transaction and
any amendment to the Charter:


 


(i)            each
Securityholder entitled to vote thereon will vote all of his or its Equity
Securities in support of all steps, actions, amendments and other matters
necessary or desirable to effectuate the subject transaction, and each
Securityholder grants to the Company its irrevocable proxy, coupled with an
interest, so to vote such Equity Securities;


 


(ii)           each
Securityholder shall take all other necessary or desirable actions within his
or its control (whether in his or its capacity as a holder of Equity
Securities, or through any of its representatives serving as a director, member
of a Board committee or officer of the Company or otherwise, and including,
without limitation, attendance at meetings in person or by proxy for purposes
of obtaining a quorum and execution of written consents in lieu of meetings) in
support of all steps, actions, amendments and other matters necessary or
desirable to effectuate the subject transaction, and each Securityholder grants
to the Company its irrevocable power of attorney to execute all documents and
take all steps so necessary or desirable; and


 


(iii)          the
Company shall take all necessary or desirable actions within its control
(including, without limitation, calling special Board and stockholder meetings
and exercising its authority under the above-referenced power of attorney), in
support of all steps, actions, amendments and other matters necessary or
desirable to effectuate the subject transaction.


 


Section 5.               Piggyback
Registration Rights.


 


(a)           If the
Company at any time proposes to register any shares of Company Common Stock
under the Securities Act, whether or not for sale for its own account, (other
than pursuant to a Special Registration) the Company shall notify the
Securityholders at least 30 days prior to the filing of the first registration
statement in connection therewith.  Upon
the receipt of a written request of any Securityholder made within 20 days
after such notice (which request shall specify the Registrable Securities
intended to be disposed of by such Securityholder and the intended method of
disposition thereof), the Company will, subject to the other provisions of this
Section 5, include in such registration all Registrable Securities with
respect to which the Company has received a written request for inclusion (a “Piggyback
Registration”).  Each such request
shall also contain an undertaking from the applicable Securityholder to provide
all such information and material and to take all actions as may be reasonably
required by the Company in order to permit the Company to comply with all applicable
federal and state securities laws.


 


22





















 


(b)           Each
selling Securityholder shall pay all sales commissions or other similar selling
charges with respect to Registrable Securities sold by such Securityholder
pursuant to a Piggyback Registration. 
The Company shall pay all registration and filing fees, fees and
expenses of compliance with federal and state securities laws, printing
expenses, messenger and delivery expenses, fees and disbursements of counsel
and accountants for the Company, and reasonable fees and disbursements of one
counsel for all selling Securityholders (who shall be selected by the
Initiating Holders, if the Piggyback Registration is also a Demand Registration
as provided in Section 6(a), and otherwise by a majority in interest of
the Securityholders participating in such Piggyback Registration), unless the
applicable state securities laws require that stockholders whose securities are
being registered pay their pro  rata share of such fees, expenses
and disbursements, in which case each Securityholder participating in the
registration shall pay its pro  rata share of all such fees,
expenses and disbursements based on its pro  rata share of the
total number of shares being registered.


 


(c)           If a
Piggyback Registration is an underwritten registration, only Registrable
Securities which are to be distributed by the underwriters may be included in
the registration.  If the managing
underwriters or, if the Piggyback Registration is not an underwritten
registration, the Company’s investment bankers, advise the Company that in
their opinion the number of securities requested to be included in such
registration exceeds the number which can be sold in such offering or will have
a material adverse effect on the price of the Registrable Securities to be
sold, the Company will include in such registration (i) if such
registration is a Qualified IPO that has been triggered pursuant to a Liquidity
Request by Mr. Knafel (or in the event of Mr. Knafel’s death or
incapacity such that he is unable to act Mr. Knafel’s Representative), the
securities proposed to be sold by the Company for its own account, then the
Registrable Securities proposed to be sold by SRK and the SRK Related Parties
until the amount of the proceeds expected to be received by SRK and the SRK
Related Parties, together with the amount of the Prior Proceeds, equals
two-thirds of the sum of (x) the parties’ best estimate of the Fair
Market Value of the Equity Securities of SRK and the SRK Related Parties and (y)
the amount of the Prior Proceeds (provided, that if all such securities
cannot be included in the offering, then Mr. Knafel (or in the event of Mr. Knafel’s
death or incapacity such that he is unable to act Mr. Knafel’s
Representative) shall designate which of SRK and the SRK Related Parties shall
participate and in what proportions), and then the other Registrable Securities
proposed to be sold by Securityholders (including SRK and the SRK Related
Parties) making a Piggyback Registration request, (ii) if such
registration is neither a registration of the type referred to in clause (i) nor
a Demand Registration, the securities proposed to be sold by the Company for
its own account, and then Registrable Securities proposed to be sold by Securityholders
making a Piggyback Registration request or, (iii) if such registration is
a Demand Registration, the securities proposed to be sold by the Initiating
Holder, then Registrable Securities proposed to be sold by the Securityholders
making a Piggyback Registration request, and then securities proposed to be
sold by the Company for its own account, provided, that,


 


23





















 


subject to clause (i) above
with respect to the priority of SRK and the SRK Related Parties, if an offering
is of sufficient size to accommodate only a portion of the Registrable
Securities proposed to be sold by the Securityholders with respect to which
such Securityholders have made a Piggyback Registration request, such
securities shall be included on a pro rata
basis based on the ratio of the number of such securities such Securityholder
has sought to register pursuant to such Piggyback Registration request to the
total number of such securities that all Securityholders have sought to register
pursuant to such Piggyback Registration request.  Notwithstanding the foregoing, but subject to
Section 4(e) and clause (i) above, if the managing underwriters
or, if the registration is not an underwritten registration, the Company’s
investment bankers, advise the Company that in their opinion, the inclusion in
a Piggyback Registration of any or all of the Equity Securities held by
management of the Company will have a material adverse effect on the offering,
the Company will not include such Securities in such registration.


 


(d)           Notwithstanding
the foregoing, if at any time after giving written notice to the
Securityholders of its intention to register any shares of Company Common Stock
pursuant to subsection (a) of this Section 5 and prior to the effective
date of the registration statement filed in connection with such registration,
the Company shall determine in accordance with the provisions of this Agreement
not to register such securities, the Company may, at its election, give written
notice of such determination to each Securityholder and thereupon shall be
relieved of its obligation to register Registrable Securities as part of such
terminated registration (but not from its obligation to pay expenses in
connection therewith as provided in subsection (b) above).  If a registration pursuant to this Section 5
involves an underwritten public offering and a Securityholder requests to be
included in such registration, such Securityholder may elect, in writing prior
to the effective date of the registration statement filed in connection with
such registration, not to participate in such registration.


 


(e)           Each
Securityholder agrees not to sell or offer for public sale or distribution,
including pursuant to Rule 144, any of such Securityholder’s Registrable
Securities within 15 days prior to or 180 days after the effective date of any
registration (except as part of such registration other than a Special
Registration) with respect to which piggyback registration rights are available
pursuant to this Section 5.


 


Section 6.               Registration
upon Request.


 


(a)           Request
for Registration.  Upon the written
request of Mr. Knafel (or in the event of Mr. Knafel’s death or
incapacity such that he is unable to act Mr. Knafel’s Representative) on
behalf of SRK and the SRK Related Parties or Carlyle (the “Initiating Holder”),
made (i) in the case of a request made on behalf of SRK and the SRK
Related Parties, at any time after 270 days have elapsed since the consummation
of a Qualified IPO and (ii) in the case of a request made by Carlyle, at
any time after the first


 


24





















 


anniversary of the
consummation of a Qualified IPO, requesting in either case that the Company
effect, pursuant to this Section 6, the registration (a “Demand
Registration”) of any of such Initiating Holder’s Registrable Securities
under the Securities Act (which request shall specify the Registrable
Securities so requested to be registered, the proposed amounts thereof, and the
intended method of disposition by the Initiating Holders), the Company shall
promptly give written notice of such requested registration to all
Securityholders pursuant to Section 5(a), and thereupon the Company will,
as expeditiously as reasonably possible, use its commercially reasonable
efforts to effect the registration under the Securities Act of the Registrable
Securities which the Company has been so requested to register by the
Initiating Holder for disposition in accordance with the intended method of
disposition stated in such request, to the extent required to permit the
disposition by the holders of the securities constituting Registrable
Securities so to be registered, provided, that Mr. Knafel (or in
the event of Mr. Knafel’s death or incapacity such that he is unable to act
Mr. Knafel’s Representative) acting on behalf of SRK and the SRK Related
Parties, collectively, may make no more than two Demand Registration requests
and Carlyle may make no more than four Demand Registration requests, and provided
further, that if the Initiating Holder is not permitted to register (as
a result of market conditions, underwriter cutbacks or otherwise) at least 50%
of the number of Registrable Securities which such holder requested to register
in any Demand Registration, then such Demand Registration request shall not be
counted for purposes of determining whether such Initiating Holder has
exhausted such holder’s right to make Demand Registration requests hereunder.


 


(b)           Limitations
on Registrations.  The registration
rights granted to Initiating Holders pursuant to this Section 6 are
subject to the following limitations:


 


(i)            each
selling Securityholder shall pay all sales commissions or other similar selling
charges with respect to the Registrable Securities sold by such Securityholder
pursuant to a Demand Registration.  The
Company shall pay all registration and filing fees, fees and expenses of
compliance with federal and state securities laws, printing expenses, messenger
and delivery expenses, fees and disbursements of counsel and accountants for
the Company and fees and expenses of one counsel, selected by the Initiating
Holders, for all selling Securityholders in connection with a Demand
Registration, unless the applicable state securities laws require that
stockholders whose securities are being registered pay their pro  rata
share of such fees, expenses and disbursements, in which case each
Securityholder participating in the registration shall pay its pro  rata
share of all such fees, expenses and disbursements based on its pro  rata
share of the total number of shares being registered;


 


(ii)           the
Initiating Holders shall determine the method of distribution of the securities
to be registered in a Demand Registration and if an underwritten offering,
shall select the managing underwriter of such offering;


 


25





















 


(iii)          the
Company shall be entitled to postpone for a reasonable time not exceeding 180
days the filing of any registration statement under this Section 6 if, at
the time it receives a request for a Demand Registration pursuant thereto, the
Board shall determine in good faith that such offering will interfere with a
pending financing, merger, sale of assets, recapitalization or other similar
corporation action which the Company is actively pursuing and is material to
the business of the Company or if the Board otherwise determines that effecting
a registration would have a material adverse effect on the Company, provided,
that the Company may only postpone such registration under this sub-clause (iii) one
time in any 360-day period; and


 


(iv)          a
registration statement that does not become effective or does not remain
effective for the period specified in Section 7(b) shall be deemed
not to constitute a registration statement filed pursuant to this Section 6,
provided, that, if such registration statement does not become effective
or does not remain effective for such period solely by reason of the Initiating
Holder’s refusal to proceed, it shall be deemed to constitute a registration
statement filed pursuant to Section 6 unless the Initiating Holder shall
have elected to pay all expenses in connection with such registration as
aforesaid.


 


(c)           Additional
Limitation.  Each Securityholder, if
required by the managing underwriter in an underwritten offering, agrees not to
sell or offer for public sale or distribution including, pursuant to Rule 144,
any of such Securityholder’s shares of Company Common Stock within 15 days
prior to or 180 days (or such lesser number of days as the managing underwriter
may require of any such Securityholder) after the effective date of any Demand
Registration (except as part of such registration).


 


(d)           Limitation
on Sales.  The Company agrees not to
effect any sale or distribution of any of its Equity Securities or of any
security convertible into or exchangeable or exercisable for any Equity
Security (other than such sale or distribution of such securities in connection
with any merger or consolidation by the Company or any subsidiary of the
Company or the acquisition by the Company or a subsidiary of the Company of the
capital stock or substantially all the assets of any other Person or in
connection with an employee stock ownership or other benefit plan) during the
15 days prior to, and during the 180 day period (or such shorter period as the
managing underwriter may require) which begins on, the effective date of a
registration statement filed in connection with a Demand Registration (except
as part of such registration).


 


Section 7.               Registration
Procedures.  If and whenever the
Company is required to use its commercially reasonable efforts to effect the
registration of any Registrable Securities under the Securities Act as provided
in this Agreement, the Company will promptly:


 


(a)           prepare
and file with the Securities and Exchange Commission (the “Commission”)
a registration statement with respect to such securities and use its


 


26





















 


commercially reasonable
efforts to cause such registration statement to become effective and to keep
such registration statement effective until the final disposition of registered
shares thereunder;


 


(b)           prepare
and file with the Commission such amendments and supplements to such
registration statement and the prospectus used in connection therewith as may
be necessary to keep such registration statement effective and to comply with
the provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement until such time as all of
such securities have been disposed of in accordance with the intended methods
of disposition by the seller or sellers thereof set forth in such registration
statement, but in no event for a period of more than six months after such
registration statement becomes effective;


 


(c)           at least
five Business Days before filing with the Commission, furnish to counsel (if
any) to the selling Securityholders in such registration copies of all
documents proposed to be filed with the Commission in connection with such
registration, which documents will be subject to the review of such counsel;


 


(d)           furnish to
each selling Securityholder such number of conformed copies of such
registration statement and of each amendment and supplement thereto (in each
case including all exhibits, except that the Company shall not be obligated to
furnish any selling Securityholder with more than two copies of such exhibits),
such number of copies of the prospectus comprised in such registration
statement (including each preliminary prospectus and any summary prospectus),
in conformity with the requirements of the Securities Act, and such other
documents, as such selling Securityholder may reasonably request in order to
facilitate the disposition of the securities owned by such selling Securityholder;


 


(e)           use its
commercially reasonable efforts to register or qualify all securities covered
by such registration statement under the securities or blue sky laws of such
jurisdictions as each selling Securityholder shall request, and do any and all
other acts and things which may be necessary or advisable to enable such
selling Securityholder to consummate the disposition in such jurisdictions of
the securities owned by such selling Securityholder, except that the Company
shall not for any such purpose be required to qualify generally to do business
as a foreign corporation in any jurisdiction wherein it is not so qualified, or
to consent to general service of process in any such jurisdiction;


 


(f)            in
connection with an underwritten offering only, use its commercially reasonable
efforts to furnish to each selling Securityholder copies of:


 


(i)            an
opinion of counsel for the Company, dated the effective date of the
registration statement, and


 


27





















 


(ii)           a “comfort”
letter signed by the independent public accountants who have certified the
Company’s financial statements included in the registration statement, each
covering substantially the same matters with respect to the registration
statement (and the prospectus included therein) and, in the case of such
accountants’ letter, with respect to events subsequent to the date of such
financial statements, as are customarily covered in opinions of issuer’s
counsel and in accountant’s letters delivered to the underwriters in
underwritten public offerings of securities;


 


(g)           notify
each selling Securityholder of any securities covered by such registration
statement, at any time when a prospectus relating thereto is required to be
delivered under the Securities Act, of the happening of any event as a result
of which the prospectus included in such registration statement, as then in
effect, includes an untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances then existing, and at
the request of any such selling Securityholder prepare and furnish to such
selling Securityholder a reasonable number of copies of a supplement to or an
amendment of such prospectus as may be necessary so that, as thereafter
delivered to the purchasers of such securities, such prospectus shall not
include an untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading in the light of the circumstances then existing;


 


(h)           otherwise
use its best efforts to comply with all applicable rules and regulations
of the Commission, and make available to the selling Securityholders, as soon
as reasonably practicable, an earnings statement covering the period of at
least 12 months, but not more than 18 months, beginning with the
first month after the effective date of such registration statement, which
earnings statement shall satisfy the provisions of Section 11(a) of
the Securities Act;


 


(i)            use its
commercially reasonable efforts to list the Registrable Securities covered by
such registration statement on any securities exchange (including NASDAQ), if
such securities are not already so listed and if such listing is then permitted
under the rules of such exchange, and to provide a transfer agent and
registrar for such Registrable Securities not later than the effective date of
such registration statement;


 


(j)            provide a
transfer agent and registrar for all such Registrable Securities not later than
the effective date of such registration statement;


 


(k)           enter into
such customary agreements (including underwriting agreements in customary form)
and take all such other actions as the holders of a majority of the Registrable
Securities being sold or the underwriters, if any, reasonably request in order


 


28





















 


to expedite or facilitate
the disposition of such Registrable Securities (including, without limitation,
effecting a stock split or a combination of shares); and


 


(l)            in
the event of the issuance of any stop order suspending the effectiveness of a
registration statement, or of any order suspending or preventing the use of any
related prospectus or suspending the qualification of any securities included
in such registration statement for sale in any jurisdiction, the Company will
use its reasonable best efforts promptly to obtain the withdrawal of such
order.


 


The Company may require each seller of Registrable
Securities as to which any registration is being effected to furnish the
Company such information regarding such seller and the distribution of such securities
as the Company may from time to time reasonably request in writing in order to
permit the Company to comply with all applicable federal and state securities
laws.


 


The Company shall make available for inspection by any
seller of Registrable Securities as to which any registration is being
effected, any underwriter participating in any disposition pursuant to the
related registration statement, and any attorney, accountant or other agent
retained by any such seller or any such underwriter (collectively, the “Inspectors”),
all financial and other records, pertinent corporate documents and properties
of the Company and its subsidiaries, if any, as shall be reasonably necessary
to enable them to exercise their due diligence responsibility, and shall cause
the Company’s and its subsidiaries’ officers, directors and employees to supply
all information and respond to all inquiries reasonably requested or made by
any such Inspector in connection with such registration statement.


 


Each Securityholder hereby agrees that upon receipt of
any notice from the Company of the happening of any event of the kind described
in Section 7(g), such holder will promptly discontinue such holder’s
disposition of Registrable Securities pursuant to the registration statement covering
such Registrable Securities until such holder’s receipt of the copies of the
supplemented or amended prospectus contemplated by Section 7(g), and, if
so directed by the Company, will deliver to the Company (at the Company’s
expense) all copies, other than permanent file copies, then in such holder’s
possession of the prospectus covering such Registrable Securities current at
the time of receipt of such notice.  In
the event the Company shall give such notice, the period mentioned in Section 7(b) shall
be extended by the number of days during the period from and including the date
when each seller of any Registrable Securities covered by such registration
statement shall have received such notice to but not including the date when
each such seller receives copies of the supplemented or amended prospectus
contemplated by Section 7(g).


 


29





















 


Section 8.               Indemnification.


 


(a)           The
Company agrees to indemnify, to the extent permitted by law, each Securityholder
participating in a registration pursuant to this Agreement, the officers and
directors of such Securityholder and each Person that controls such
Securityholder (within the meaning of the Securities Act) against any and all
losses, claims, damages, liabilities and expenses, including all reasonable
legal fees incurred therewith, arising out of, based upon or resulting from any
untrue statement or alleged untrue statement of a material fact contained in
any registration statement, prospectus or preliminary prospectus, or any
amendment thereof or supplement thereto, or any omission or alleged omission to
state therein a material fact required to be stated therein or necessary to
make the statement therein not misleading in light of the circumstances then existing
or any violation or alleged violation by the Company of any federal, state,
foreign or common law rule or regulation applicable to the Company and
relating to action required of or inaction by the Company in connection with
any such registration, except insofar as it is judicially determined that the
liability resulted from information furnished in writing to the Company by such
Securityholder and stated by the Securityholder to be used therein or, in the
case of an underwritten offering only, from such Securityholder’s failure to
deliver a copy of the registration statement, prospectus or preliminary
prospectus or any amendments thereof or supplements thereto.


 


(b)           Each
Securityholder participating in a registration pursuant to this Agreement
agrees to indemnify, to the extent permitted by law, the Company, its directors
and officers and each Person that controls (within the meaning of the
Securities Act) the Company against any and all losses, claims, damages,
liabilities and expenses, including all reasonable legal fees incurred in
connection therewith, arising out of, based upon or resulting from any untrue
statement or alleged untrue statement of material fact contained in any
registration statement, prospectus or preliminary prospectus, or any amendment
thereof or supplement thereto, or any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then existing,
but only to the extent that such untrue statement or (as to the matters set
forth in such information or affidavit) omission is contained in any
information or affidavit furnished to the Company in writing by such
Securityholder and stated to be expressly for use therein and except insofar as
the same result from the Company’s failure to deliver a copy of the
registration statement, prospectus or preliminary prospectus or any amendment
thereof or supplement thereto, provided, that such Securityholder’s
obligations hereunder shall be limited to an amount equal to the proceeds to
such Securityholder of the Registrable Securities sold pursuant to such
registration statement.


 


(c)           In
connection with an underwritten offering, the Company and each Securityholder
participating in the related registration will indemnify the underwriter(s),


 


30





















 


their officers and
directors and each Person who controls such underwriter(s) (within the meaning
of the Securities Act) to the same extent as provided in this Section 8.


 


(d)           Promptly
after receipt by an indemnified party of notice of the commencement of any
action or proceeding involving a claim referred to in the preceding subsections
of this Section 8, such indemnified party will, if a claim in respect
thereof is to be made against an indemnifying party, give written notice to the
latter of the commencement of such action, provided, that the failure of
any indemnified party to give notice as provided herein shall not relieve the
indemnifying party of its obligations under the preceding subsections of this Section 8,
except to the extent that the indemnifying party is actually and materially
prejudiced by such failure to give notice. 
In any case in which any such action is brought against an indemnified
party, the indemnifying party will be entitled to participate in and to assume
the defense thereof, jointly with any other indemnifying party similarly
notified, to the extent that it may wish, with counsel reasonably satisfactory
(taking into account, among other factors, any potential exposure of the
indemnified party to criminal liability) to such indemnified party, and after
notice from the indemnifying party to such indemnified party of its election so
to assume the defense thereof, the indemnifying party will not be liable to
such indemnified party for any legal or other expenses subsequently incurred by
the latter in connection with the defense thereof unless, in the reasonable
judgment of any such indemnified party, a conflict of interest may exist
between such indemnified party and any indemnifying party or any other of such
indemnified parties, in which case the indemnifying party shall be liable to
such indemnified party for any reasonable legal or other expenses incurred in
defending such action.  No indemnifying
party will consent to entry of any judgment or enter into any settlement which
does not include as an unconditional term thereof the giving by the claimant or
plaintiff to such indemnified party of a release from all liability in respect
of such claim or litigation. 
Notwithstanding the foregoing, and without limiting any of the rights
set forth above, in any event any party will have the right to retain, at its
own expense, counsel with respect to the defense of a claim.


 


(e)           If for
any reason the foregoing indemnity is unavailable, then the indemnifying party
shall contribute to the amount paid or payable by the indemnified party as a
result of such losses, claims, damages, liabilities or expenses (i) in
such proportion as is appropriate to reflect the relative benefits (which
relative benefits with respect to such offering shall be deemed to be in the
same proportion as the respective net proceeds received from such offering by
the Company and the Securityholders determined as set forth on the table on the
cover page of the prospectus) received by the indemnifying party on the
one hand and the indemnified party on the other or (ii) if the allocation
provided by subdivision (i) above is not permitted by Applicable Law
or provides a lesser sum to the indemnified party than the amount hereinafter
calculated, in such proportion as is appropriate to reflect not only the
relative benefits received by the indemnifying party on the one hand and the
indemnified party on the other but also the relative fault of the indemnifying
party and the indemnified party (which relative fault


 


31





















 


shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or omission or alleged omission to state a
material fact relates to information supplied by the Company or the
Securityholders, the intent of the parties and their relative knowledge, access
to information and opportunity to prevent or correct such statement or
omission) as well as any other relevant equitable consideration.  Notwithstanding the foregoing, (A) no
holder of Registrable Securities shall be required to contribute any amount in
excess of the amount such holder would have been required to pay to an
indemnified party if the indemnity under subsection (b) of this Section 8
was available and (B) no underwriter, if any, shall be required to
contribute any amount in excess of the amount by which the total price at which
the Registrable Securities underwritten by it and distributed to the public
were offered to the public exceeds the amount of any damages which such
underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission.  No Person guilty of fraudulent
misrepresentation (within the meaning of Section 12(f) of the
Securities Act) shall be entitled to contribution from any Person who was not
guilty of such fraudulent misrepresentation. 
The obligation of any underwriters to contribute pursuant to this Section 8
shall be several in proportion to their respective underwriting commitments and
not joint.


 


(f)            An
indemnifying party shall make payments of all amounts required to be made
pursuant to the foregoing provisions of this Section 8 to or for the
account of the indemnified party from time to time promptly upon receipt of
bills or invoices relating thereto or when otherwise due and payable.


 


Section 9.               Management
Bonus Pool.  For the Company’s 2005
fiscal year and for each subsequent fiscal year of the Company that begins
while this Section 9 remains in effect, and subject to subsection (e) of
this Section 9, the Company shall establish an annual incentive
compensation pool equal to a maximum amount of $3.0 million (the “Bonus Pool”),
which shall be determined and allocated as follows:


 


(a)           Management
Representatives’ Allocations.  The
Company shall allocate and award an aggregate cash bonus amount of $1.5 million
(or, for the Company’s 2005 fiscal year, an amount equal to the number of days
remaining in such fiscal year after the date on which the Closing occurs
multiplied by $4,110) among certain managers and employees of the Company and
its Subsidiaries in accordance with the recommendations of both Mr. Knafel
and Mr. Willner (each, a “Management Representative”), which shall
be prepared in consultation with the Compensation Committee.


 


(b)           Compensation
Committee Allocations.  The Company
shall allocate and award a further aggregate cash bonus amount equal to $1.5
million (or, for the Company’s 2005 fiscal year, an amount equal to the number
of days remaining in such fiscal year after the date on which the Closing
occurs multiplied by $4,110) among certain managers and employees of the
Company and its Subsidiaries in accordance with


 


32





















 


the recommendations of
the Management Representatives, which shall be subject to the approval of the
Compensation Committee; provided that such amount shall be reduced (but
not below zero) by $15,000 (the “Reducer Amount”) (or, for the Company’s
2005 fiscal year, an amount equal to the number of days remaining in such
fiscal year after the date on which the Closing occurs multiplied by $41.09)
for each one tenth of a percentage point, if any, that the Company’s actual “earnings
before interest, taxes, depreciation and amortization” (“EBITDA”) for
the applicable fiscal year is less than budgeted EBITDA (as approved by the
Board) for such applicable fiscal year. 
For purposes of this Section 9, actual EBITDA and budgeted EBITDA
shall be “normalized” by adjusting them to eliminate the effect of one time
items.  In the event of any such
reduction (i) individual allocations shall be reduced pro  rata,
and (ii) the unpaid portion of the Bonus Pool shall not rollover to a
subsequent fiscal year.


 


(c)           Certain
Allocations; Payment.  Any awards
that become payable pursuant to (i) Section 9(a) shall be paid
no later than February 28 of the next calendar year with respect to which
such bonus amounts were allocated and awarded and (ii) Section 9(b) shall
be paid as soon as reasonably practicable following receipt by the Company of
its financial statements for the applicable fiscal year (accompanied by an
audit report of its accountants). 
Subject to the terms of any applicable employment agreement, any
individual selected to receive a bonus pursuant to Section 9(a) or Section 9(b) shall
be entitled to receive such bonus only if such individual is employed on December 31
of the calendar year with respect to which such bonus amounts were allocated
and awarded.


 


(d)           Management
Representatives.  For purposes of
this Section 9, if either Management Representative is no longer providing
services to the Company or any Subsidiary thereof, any recommendation that is
to be made by the Management Representatives under this Section 9 must be
made by the Management Representative who is still providing services to the
Company or any Subsidiary thereof, and if neither is providing services to the
Company or any Subsidiary thereof, the Compensation Committee may make any such
award or awards in its sole discretion.  Mr. Knafel
shall be deemed to be providing services to the Company so long as he is
serving as a director of the Company.


 


(e)           Partnership
Split-Up.  Following the consummation
of the Partnership Split-Up, the Bonus Pool will be administered in the same
manner as provided above except that the amount of the Bonus Pool will be
adjusted as follows:


 


(i)            The
annual amount to be allocated and awarded by the Company under Section 9(a) for
the period following the Partnership Split-Up shall be equal to the sum of (A) 
$500,000 plus (B)  the product of (1) $1,000,000 times (2) a
fraction, the denominator of which is consolidated revenues of the Company and
its Subsidiaries for the four fiscal quarters most recently ended at the
closing of the Partnership Split-Up and the numerator of which is the portion
of such consolidated revenues of the Company and 


 


33





















 


its Subsidiaries for the
four fiscal quarters most recently ended at the closing of the Partnership
Split-Up that is attributable to the portion of the business being retained by
the Company in the Partnership Split-Up (such amount, the “Annual Post Split
Amount”).


 


(ii)           The
annual amount to be allocated and awarded by the Company under Section 9(b) shall
be equal to the Annual Post Split Amount, with the Reducer Amount being 1/100th
of the Annual Post Split Amount rather than $15,000.


 


(iii)          For
purposes of determining the bonus pool for the year in which the closing of the
Partnership Split-Up occurs:


 


(A)          The amount to be allocated and awarded
by the Company under Section 9(a) for such year shall be equal to (1) the
sum of (x) the product of $1,500,000 times the number of days that elapse in
such year prior to and including the closing of the Partnership Split-Up plus
(y) the product of the Annual Post Split Amount times the number of days that
elapse in such year after the closing of the Partnership Split-Up closes,
divided by (2) 365 (such amount, the “Prorated Split Amount”);


 


(B)           The amount to be allocated and
awarded by the Company under Section 9(b) shall be equal to the
Prorated Split Amount, with the reducer Amount being 1/100th of the
Prorated Split Amount.


 


(iv)          After
the Partnership Split-Up closes, in connection with any acquisition or
disposition that would have a material effect on the consolidated revenues of
the Company and its Subsidiaries, Carlyle, Mr. Knafel and Mr. Willner
shall discuss in good faith appropriate adjustments to the Bonus Pool.


 


(f)            Ordinary
Course Bonuses.  For the avoidance of
doubt, it is not intended that the Bonus Pool established pursuant to this Section 9
will replace or be in lieu of the bonuses that the Company awards under its
ordinary course compensation policies as determined by its Compensation
Committee.


 


Section 10.             Certain
Rights and Obligations.


 


(a)           Certain
Voting Rights; Venture Capital Investment. 
The Company acknowledges that Carlyle has the right to elect directors
to serve on the Board by virtue of the ownership of the Series B Voting
Preferred Stock.  The Carlyle entities
agree that they shall exercise their voting rights with respect to the Series B
Voting Preferred Stock in order to cause each of CP III and CP IV to have the
right to designate at least one director to serve on the Board for so long as
Carlyle has the right to elect directors. 
In addition, the Company hereby agrees that it shall (i) provide
each of CP III and CP IV with the opportunity to designate a Person
to serve as its observer on the Board, which


 


34





















 


Person shall have the
authority to attend any meeting of the Board and shall receive notice of all
meetings of the Board as though such Person were a member of the Board, (ii) furnish
each of CP III and CP IV with such financial and operating data and
other information with respect to the business and properties of the Company as
the Company prepares and compiles for its directors in the ordinary course and
as CP III or CP IV may from time to time reasonably request and (iii) shall
permit each of CP III and CP IV to discuss the affairs, finances and
accounts of the Company with, and to make proposals and furnish advice with
respect thereto to, the principal officers of the Company.  The rights set forth in this Section 10(a) are
intended to satisfy the requirement of contractual management rights for the
purpose of qualifying each of CP III and CP IV as a “venture capital
operating company” under the Department of Labor’s “plan assets” regulations.


 


(b)           Restrictions
on Rights in Certain Business Ventures. 
None of the Company, the Company Subsidiaries or any of the Company’s
stockholders shall have any rights in any business venture, investment, or
activities of any other stockholder of the Company by reason of such other
stockholder’s investment in, or contractual relationship with, the Company.


 


(c)           Independent
Directors.  If at any time that any
Voting Preferred Stock is issued and outstanding, an Independent Director
elected by the Series A Voting Preferred Stock or the Series B Voting
Preferred Stock ceases to satisfy the independence requirements sets forth in
the definition of “Independent Director” in the Charter, the holders of the
applicable series of Voting Preferred Stock shall remove such director.


 


Section 11.             Proxies.


 


(a)           The
following proxies and powers are given in connection with the entry into this
Agreement:


 


(i)            Upon Mr. Knafel’s
death or incapacity such that he is unable to act, Mr. Knafel hereby
appoints Mr. Willner as Mr. Knafel’s true and lawful proxy and
attorney-in-fact, with full power of substitution, to vote all of the Equity
Securities owned by Mr. Knafel (in the event of Mr. Knafel’s death,
at the time of his death).


 


(ii)           Upon Mr. Willner’s
death or incapacity such that he is unable to act, Mr. Willner hereby
appoints Mr. Knafel as Mr. Willner’s true and lawful proxy and
attorney-in-fact, with full power of substitution, to vote all of the Equity
Securities owned by Mr. Willner (in the event of Mr. Willner’s death,
at the time of his death).


 


(iii)          Upon the death or
incapacity such that they are unable to act of both Mr. Knafel and Mr. Willner,
Mr. Knafel, Mr. Willner and their


 


35





















 


applicable
Permitted Assignees hereby appoint Carlyle as their true and lawful proxy and
attorney-in-fact, with full power of substitution, to vote all of the
Governance Preferred Stock owned by Mr. Knafel, Mr. Willner and their
Permitted Assignees (in the event of either of Mr. Knafel’s or Mr. Willner’s
death, at the time of their death).


 


(iv)          SRK (excluding Mr. Knafel)
and each direct and indirect Permitted Assignee of SRK hereby appoints Mr. Knafel
and, upon Mr. Knafel’s death or incapacity such that he is unable to act, Mr. Willner,
as such Securityholder’s true and lawful proxy and attorney-in-fact, with full
power of substitution, to vote all of the Equity Securities beneficially owned
by such Securityholder and to exercise all of the rights given to such
Securityholder hereunder, provided, that such appointment shall not
apply to a Permitted Assignee of Mr. Knafel or ICI Communications, Inc.
in connection with a Transfer of Series C Non-Voting Preferred Stock or
Non-Voting Common Stock if Mr. Knafel notifies the Company and Carlyle in
good faith that such appointment would materially jeopardize the tax and estate
planning purposes of such Transfer.


 


(v)           Each direct and
indirect Permitted Assignee of Mr. Willner hereby appoints Mr. Willner
and, upon Mr. Willner’s death or incapacity such that he is unable to act,
Mr. Knafel, as such Securityholder’s true and lawful proxy and
attorney-in-fact, with full power of substitution, to vote all of the Equity
Securities beneficially owned by such Securityholder and to exercise all of the
rights given to such Securityholder hereunder, provided, that such
appointment shall not apply to a Permitted Assignee in connection with a
Transfer of Series C Non-Voting Preferred Stock or Non-Voting Common Stock
if Mr. Willner notifies the Company and Carlyle in good faith that such
appointment would materially jeopardize the tax and estate planning purposes of
the Transfer.


 


(vi)          Each Permitted
Assignee of any Carlyle entity that is not an Affiliate of TC Group, L.L.C.
hereby appoints TC Group, L.L.C. as its true and lawful proxy and
attorney-in-fact, with full power of substitution, to vote all of the Equity
Securities owned by such Permitted Assignee and to exercise all of the rights
given to such Securityholder hereunder.


 


(vii)         Each Securityholder
that is the beneficial owner of shares of Non-Voting Common Stock hereby
appoints Mr. Knafel, and upon Mr. Knafel’s death or incapacity such
that he is unable to act, Mr. Willner, as such Securityholder’s true and
lawful proxy and attorney-in-fact, with full power of substitution, to vote all
of the shares of Non-Voting Common Stock beneficially owned by such
Securityholder; provided that


 


36





















 


such proxy and
power of attorney shall not be used in a manner that materially and adversely
affects the rights or privileges of a particular Securityholder with respect to
Equity Securities of a specific class or series unless such action similarly
affects the rights or privileges of all other Securityholders with respect to
such specific class or series of Equity Securities, unless the particular
Securityholder consents to such action.


 


(b)           The
proxies and powers given pursuant to Section 11(a) are irrevocable
and binding upon the Securityholders appointing such proxies and
attorneys-in-fact and the successors, assigns, representatives, estates (and
their executors), heirs and legatees thereof until (whether before or after the
third anniversary of the date hereof) (i) such time as this Agreement is
terminated pursuant to the first sentence of Section 12(d)(i) or (ii) with
respect to any holder of Equity Securities, at such time as such holder is not
a party to this Agreement and is not required to be a party hereto in
accordance with the terms hereof.


 


Section 12.             Miscellaneous.


 


(a)           Severability.  If any provision of this Agreement is
invalid, inoperative or unenforceable for any reason, such circumstance shall
not have the effect of rendering the provision in question inoperative or
unenforceable in any other case or circumstance, or of rendering any other
provision or provisions herein contained invalid, inoperative or unenforceable
to any extent whatsoever.  The invalidity
of any one or more phrases, sentences, clauses, Sections or subsections of this
Agreement shall not affect the remaining portions of this Agreement.


 


(b)           Information.


 


(i)            Each
of the Securityholders agrees that, from the date hereof and for so long as it
shall own any Equity Securities, it will furnish the Company such necessary information
and reasonable assistance as the Company may reasonably request (x) in
connection with the consummation of the transactions contemplated by this
Agreement, (y) in connection with the preparation and filing of any
reports, filings, applications, consents or authorizations with any
Governmental Entity under any Applicable Law and (z) in order for
the Company to determine, from time to time, whether it is a “personal holding
company” within the meaning of Section 542 of the Code.  Each Securityholder proposing to make a
Transfer pursuant to Section 1 shall provide the Company with any
information reasonably requested in order for the Company to determine whether
the proposed Transfer would be a Prohibited Transfer.


 


(ii)           Within
90 days of the end of each fiscal year, the Company shall mail to each
Securityholder a report setting forth a balance sheet as at the end of such
fiscal year and statements of income, common stockholders’ equity and cash
flows for such fiscal 


 


37





















 


year of the Company and
its Subsidiaries on a consolidated basis, audited by a nationally recognized
accounting firm, and any other information the Company deems necessary or
desirable.  Within 45 days after the end of
the first, second and third quarterly accounting periods in each fiscal year of
the Company, the Company will furnish to each Securityholder a report setting
forth a consolidated unaudited balance sheet of the Company, as of the end of
each such quarterly period, and consolidated statements of income for such
period and for the current fiscal year to date. 
The Company shall provide the requisite number of copies of the reports
to Holdco to enable Holdco to furnish the reports to each of the Holdco
Continuing Investors.


 


(iii)          The
Company will at reasonable times and upon reasonable notice give Carlyle and
any advisor of Carlyle reasonable access to the books, records and properties
of the Company, including access to all monthly management reports and will
permit such holders and/or advisors to discuss the Company’s affairs with the
executive officers and other members of the management of the Company.


 


(c)           Notices.  All notices and other communications made in
connection with this Agreement shall be in writing.  Any notice or other communication in
connection herewith shall be deemed duly given to any party (a) two
Business Days after it is sent by express, registered or certified mail, return
receipt requested, postage prepaid or (b) one Business Day after it is
sent by overnight courier guaranteeing next day delivery, in each case,
addressed as follows or, to such other address as may be specified in writing
to the other parties hereto:


 


(A)          if to the Company:


 


Insight Communications Company, Inc.

810 7th Avenue, 41st Floor


New York, New York 
10019

Facsimile:  (917) 286-2301 

Attention:  Elliot Brecher


 


with a copy to:



Dow, Lohnes & Albertson, PLLC

1200 New Hampshire Ave., NW

Washington, DC 20036-6802

Facsimile:  (202) 776-2222

Attention:  Leonard J. Baxt


 J. Kevin Mills


 


and


 


38





















 


Debevoise & Plimpton LLP

919 Third Avenue

New York, New York  10022

Facsimile:  (212) 909-6836

Attention: Jeffrey J. Rosen

                
Andrew L. Bab


 


(B)           if to Carlyle:


 


c/o The Carlyle Group

1001 Pennsylvania Avenue, N.W.


Suite 220 South


Washington, D.C. 
20004-2505

Facsimile:  (202) 347-1692

Attention:  William E. Kennard


 


with a copy to:



Debevoise & Plimpton LLP

919 Third Avenue

New York, New York  10022

Facsimile:  (212) 909-6836

Attention: Jeffrey J. Rosen

               
 Andrew L. Bab


 


(C)           if to any other Securityholder, to
the name and address set forth opposite such Securityholder’s signature on the
signature pages hereto;


 


(D)          if to any Person who becomes a party
to this Agreement after the date hereof, to the name and address specified for
such Person in Schedule A hereto.


 


Any party may give any notice or other communication
in connection herewith using any other means (including, but not limited to,
personal delivery, messenger service, facsimile, telex or ordinary mail), but
no such notice or other communication shall be deemed to have been duly given
unless and until it is actually received by the individual for whom it is
intended.


 


(d)           Termination.


 


(i)            This Agreement
shall terminate at such time as Carlyle and Mr. Knafel (or upon Mr. Knafel’s
death or incapacity such that he is unable to act, Mr. Willner, or upon Mr. Willner’s
death or incapacity such


 


39





















 


that he is unable
to act, Mr. Knafel’s Representative) so decide.  This Agreement shall terminate with respect
to any particular Securityholder at such time as such Securityholder no longer
holds any Equity Securities.  No
termination pursuant to this Section 12(d)(i) shall deprive any
Securityholder of any right or relieve any Securityholder of any obligation
accruing prior to such termination.


 


(ii)           Sections 9 and
12(b)(ii) of this Agreement shall terminate immediately upon the
consummation of a Qualified IPO or Sale. 
Sections 2, 3 and 4 of this Agreement shall terminate after the
consummation of a Qualified IPO at such time as 80% or more of the issued and
outstanding Company Common Stock is held by Persons not party to this
Agreement.


 


(e)           Legends.  Each certificate representing Equity
Securities shall be endorsed with the following legend and any other legends
required by applicable securities laws:


 


THE SHARES OF [COMMON STOCK] [PREFERRED STOCK]
REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE “ACT”), AND ARE “RESTRICTED SECURITIES” AS
DEFINED IN RULE 144 PROMULGATED UNDER THE ACT. 
THE [COMMON STOCK] [PREFERRED STOCK] MAY NOT BE SOLD OR OFFERED FOR
SALE OR OTHERWISE DISTRIBUTED EXCEPT (I) IN CONJUNCTION WITH AN
EFFECTIVE REGISTRATION STATEMENT FOR THE SHARES UNDER THE ACT, (II) IN
COMPLIANCE WITH RULE 144 OR (III) OTHERWISE PURSUANT TO AN
EXEMPTION FROM THE REGISTRATION REQUIREMENTS UNDER THE ACT.  THE SHARES REPRESENTED BY THIS CERTIFICATE MAY BE
TRANSFERRED ONLY IN ACCORDANCE WITH THE TERMS OF THE SECURITYHOLDERS AGREEMENT,
DATED AS OF DECEMBER 16, 2005, AMONG INSIGHT COMMUNICATIONS COMPANY, INC.
(THE “COMPANY”), AND THE OTHER PARTIES THERETO, A COPY OF WHICH IS ON
FILE WITH THE SECRETARY OF THE COMPANY.


 


(f)            Headings.  The headings contained in this Agreement are
for purposes of convenience only and shall not affect the meaning or
interpretation of this Agreement.


 


(g)           Entire
Agreement.  This Agreement
constitutes the entire agreement and supersedes all prior agreements and
understandings, both written and oral, among the parties with respect to the
subject matter hereof.


 


40





















 


(h)           Counterparts.  This Agreement may be executed in several
counterparts, each of which shall be deemed an original and all of which shall
together constitute one and the same instrument.


 


(i)            Governing
Law.  This Agreement shall be
governed by and construed in accordance with the internal laws of the State of
New York applicable to agreements made and performed within such State, except
to the extent the laws of the State of Delaware mandatorily apply.


 


(j)            Binding
Effect.  This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective heirs, successors and permitted assigns.


 


(k)           Remedy.  Each of the Securityholders acknowledges that
a breach by a Securityholder of any of its obligations under this Agreement
would result in irreparable damage to non-breaching Securityholders and agrees
that, in the event of a breach by a Securityholder of any such obligation, each
non-breaching Securityholder shall, in addition to any other rights and
remedies available to it in respect of such breach, be entitled to an
injunction from a court of competent jurisdiction (without any requirement to
post bond) granting it specific performance of any obligations under this
Agreement by such Securityholder who has breached any such obligations.


 


(l)            Assignment.  This Agreement shall not be assignable by any
party without the prior written consent of the other parties.


 


(m)          Third
Party Beneficiaries.  Nothing in this
Agreement shall confer any rights upon any Person other than the parties hereto
and each such person’s respective heirs, successors and permitted assigns, all
of whom shall be third party beneficiaries of this Agreement, provided,
that the Persons indemnified under Section 8 that are not signatories to
this Agreement are intended third-party beneficiaries of Section 8.


 


(n)           Amendment;
Waivers, Etc.  This Agreement may be
amended, and the Company may take any action herein prohibited, or omit to
perform any act herein required to be performed by it, only if the Company
shall have obtained the written consent to such amendment, action or omission
to act, of (i) prior to Final Reclassification, Carlyle and Mr. Knafel
(or upon Mr. Knafel’s death or incapacity such that he is unable to act, Mr. Willner,
or upon Mr. Willner’s death or incapacity such that he is unable to act, Mr. Knafel’s
Representative) (provided, that the provisions of Section 2 with
respect to the Tag-Along Right of the holders of Series C Non-Voting
Preferred Stock, the holders of Series D Non-Voting Preferred Stock and
the Eligible Series E Stockholders may not be amended without the written
consent, as applicable, of the holders of a majority in interest of the Series C
Non-Voting Preferred Stock, the Series D Non-Voting Preferred Stock or the
Series E Common Stock) and (ii) after Final Reclassification, Carlyle
and Mr. Knafel (or upon Mr. Knafel’s death or incapacity such


 


41





















 


that he is unable to act,
Mr. Willner, or upon Mr. Willner’s death or incapacity such that he
is unable to act, Mr. Knafel’s Representative).  No provision of this Agreement may be waived,
discharged or terminated other than by an instrument in writing signed by the
Securityholder against whom the enforcement of such waiver, discharge or
termination is sought, provided, that (i) prior to the Final
Reclassification, Mr. Knafel (or upon Mr. Knafel’s death or
incapacity such that he is unable to act, Mr. Willner, or upon Mr. Willner’s
death or incapacity such that he is unable to act, Mr. Knafel’s
Representative) may, on behalf of the other holders of Series C Non-Voting
Preferred Stock, Series E Common Stock or Series F Common Stock, and
Carlyle may, on behalf of the other holders of Series D Non-Voting
Preferred Stock, waive any provision of this Agreement applicable to any or all
of such other holders of such series, as applicable, without regard to whether
any other such holder has executed such an instrument, and such waiver shall be
effective as against any or all such other holders (provided, that the
Tag-Along Right of the holders of Series C Non-Voting Preferred Stock, the
holders of Series D Non-Voting Preferred Stock and the Eligible Series E
Stockholders pursuant to Section 2 may not be waived without the written
consent, as applicable, of the holders of a majority in interest of the Series C
Non-Voting Preferred Stock, the Series D Non-Voting Preferred Stock or the
Series E Common Stock) and (ii) after Final Reclassification, Carlyle
and Mr. Knafel (or upon Mr. Knafel’s death or incapacity such that he
is unable to act, Mr. Willner, or upon Mr. Willner’s death or
incapacity such that he is unable to act, Mr. Knafel’s Representative),
may, on behalf of the other holders of Company Common Stock, waive any
provision of this Agreement applicable to any or all of such other holders of
such stock without regard to whether any other such holder has executed such an
instrument, and such waiver shall be effective as against any or all such other
holders.  For the avoidance of doubt, the
addition of a new party to this Agreement (by joinder or otherwise) shall not
by itself constitute an amendment, modification, discharge or waiver of this
Agreement.  Notwithstanding the
foregoing, no amendment to this Agreement and no waiver of any provision hereof
may be adopted that would alter, in a material and adverse manner, the rights
or privileges of a particular Securityholder with respect to Equity Securities
of a specific class or series unless such amendment or waiver similarly alters
the same rights and privileges of all other Securityholders with respect to
such specific class or series of Equity Securities, unless the particular
Securityholder consents to such amendment or waiver.


 


(o)           Consent
to Jurisdiction.  Each party
irrevocably submits to the exclusive jurisdiction of (a) the Supreme Court
of the State of New York, New York County, and (b) the United States
District Court for the Southern District of New York, for the purposes of any
suit, action or other proceeding arising out of this Agreement or any
transaction contemplated hereby (and agrees not to commence any such suit,
action or other proceeding except in such courts).  Each party further agrees that service of any
process, summons, notice or document by U.S. registered mail to such party’s
respective address set forth or referred to in Section 12(c) shall be
effective service of process for any such suit, action or other
proceeding.  Each party irrevocably and
unconditionally


 


42





















 


waives any objection to
the laying of venue of any such suit, action or other proceeding in (i) the
Supreme Court of the State of New York, New York County, and (ii) the
United States District Court for the Southern District of New York, and that
any such suit, action or other proceeding brought in any such court has been
brought in an inconvenient forum.


 


(p)           Waiver
of Jury Trial.  Each party hereby
waives, to the fullest extent permitted by Applicable Law, any right it may
have to a trial by jury in respect of any suit, action or other proceeding
arising out of this Agreement or any transaction contemplated hereby.  Each party (i) certifies that no
representative, agent or attorney of any other party has represented, expressly
or otherwise, that such other party would not, in the event of litigation, seek
to enforce the foregoing waiver and (ii) acknowledges that it and the
other parties have been induced to enter into the Agreement by, among other
things, the mutual waivers and certifications in this Section 12(p).


 


(q)           Subsequent
Securityholders.  Each of the parties
hereto agrees that in order for any Person who after the date of this Agreement
acquires Equity Securities or securities exercisable for or convertible into
Equity Securities (or any interest therein) to become a party to this
Agreement, both the Company and such Person must execute Schedule A hereto
and duly executed copies thereof must be delivered to the other Securityholders
in accordance with Section 12(c). 
The Company shall maintain a register of all parties to this Agreement
which shall be available for review by any party hereto.  Any Transfer of Equity Securities (or any
interest therein) to a Transferee required hereby to become a party to this
Agreement shall be of no effect and shall be void ab initio unless such Transferee becomes a party to this
Agreement as provided in the first sentence of this Section 12(q).


 


(r)            Certain Definitions.


 


“Accepting Securityholder” has the meaning
given in Section 2.


 


“Affiliate” means, with respect to any Person,
any other Person directly or indirectly Controlling, Controlled by or under
common Control with such first Person.


 


“Agreement” has the meaning given in the
Preamble.


 


“Applicable Law” means all applicable
provisions of (i) constitutions, treaties, statutes, laws (including the
common law), rules, regulations, ordinances, codes or orders of any
Governmental Entity, (ii) any consents or approvals of any Governmental
Entity and (iii) any orders, decisions, injunctions, judgments, awards,
decrees of or agreements with any Governmental Entity.


 


“Bloomberg” means Bloomberg Financial L.P.


 


“Board” means the Board of Directors of the
Company.


 


43





















 


“Bonus Pool” has the meaning given in Section 9.


 


“Business Day” means a day other than a
Saturday, Sunday or other day on which commercial banks in New York City are
authorized or required to close.


 


“Carlyle” has the meaning given in the
Preamble.


 


“Carlyle IRR” means, as of any date, the
internal rate of return, determined on the basis of annual compounding,
realized or to be realized by Carlyle as of such date on the Equity Securities
then owned by Carlyle.  The Carlyle IRR
shall be determined in respect of any Sale as if Carlyle liquidated its
remaining Equity Securities at the estimated closing date for such Sale for the
Fair Market Value of the aggregate consideration to be received by Carlyle in
such Sale (including the Fair Market Value of any Equity Securities to be
retained by Carlyle and the Fair Market Value as of the estimated closing date
of any escrow or like arrangement securing indemnification obligations or contingent
liabilities that is part of the Sale consideration (including any note other
than one that is expressly not subject to a set-off or similar right in respect
of indemnification obligations or other contingent liabilities), as permitted
by this Agreement).  In determining the
Carlyle IRR in respect of a Sale, there shall be taken into account the portion
of each distribution theretofore made by the Company in respect of its Equity
Securities that was received by Carlyle in respect of the Equity Securities
held by Carlyle at such closing date (including distributions received by
Carlyle in respect of Equity Securities that were converted into or exchanged
for such Equity Securities held at such closing date).  For the avoidance of doubt, no distributions
or portions of distributions received by Carlyle in respect of Equity
Securities not held by Carlyle at such closing date, no reimbursements or other
payments, and no proceeds received by Carlyle from the sale of Equity
Securities prior to such Sale shall be taken into account.


 


“Charter” means the Amended and Restated
Certificate of Incorporation of the Company as on file with the Secretary of
State of Delaware, as such certificate of incorporation may be amended from
time to time.


 


“Class D Preferred Stock” has the meaning
given in the Exchange Agreement.


 


“Code” means the Internal Revenue Code of 1986,
as amended.


 


“Commission” has the meaning given in Section 7(a).


 


“Company” has the meaning given in the
Preamble.


 


“Company Common Stock” means (i) shares
of Final Reclassification Stock, (ii) shares of any other class of
common stock of the Company issued in connection with, or outstanding at any
time subsequent to, a Qualified IPO, and (iii) any securities
issued with respect to any such common stock (a) by way of a
dividend or stock split or (b) in


 


44





















 


connection
with a combination of shares, recapitalization, combination, merger,
consolidation or other reorganization.


 


“Company Liquidity Event” has the meaning given
in Section 4(a)(ii).


 


“Company Subsidiaries” means the Subsidiaries
of the Company.


 


“Compensation Committee” means the compensation
committee of the Board.


 


“Control” means the power to direct the affairs
of a Person by reason of ownership of voting securities, by contract or
otherwise.


 


“Demand Registration” has the meaning given in Section 6(a).


 


“Designated Purchaser” has the meaning given in
Section 2.


 


“Draft Sale Agreement” has the meaning given in
Section 3.


 


“Drag-Along Notice” has the meaning given in Section 3.


 


“Drag-Along Offer” has the meaning given in Section 3.


 


“Drag-Along Sale” has the meaning given in Section 3.


 


“Drag-Along Securities” has the meaning given
in Section 3.


 


“EBITDA” has the meaning given in Section 9(b).


 


“Effective Time” has the meaning assigned to
such term in the Merger Agreement.


 


“Eligible Series E Common Stock” means, as
of any date of determination, all shares of Series E Common Stock that are
vested and have a remaining unsatisfied Participation Level less than the Offer
Price.


 


“Employee” means any employee of the Company or
any of its Subsidiaries.


 


“Equity Securities” means any equity securities
of the Company, including any shares of Non-Voting Common Stock, Preferred
Stock or Company Common Stock, and any options, warrants or other rights to
acquire such equity securities or debt or equity securities convertible into,
or exchangeable for, such equity securities and any securities into which any
of the foregoing are converted or for which any of the foregoing are exchanged.


 


45





















 


“Estimated Final Reclassification Amount” has
the meaning given in Section 4(e)(ii).


 


“Exchange Act” means the Securities and
Exchange Act of 1934, as amended.


 


“Exchange Agreement” has the meaning given in
the Merger Agreement.


 


“Fair Market Value” has the meaning given in Section 4(a)(iv).


 


“Family Group” means, with respect to any
natural person, (a) such person’s spouse (including pursuant to any
divorce decree and, in the case of Mr. Willner, his former spouse), (b) any
lineal ancestor or descendant of such person, (c) any trust or trusts in
which any of the foregoing, individually or collectively, has, directly or
indirectly, at least 81% of the beneficial interest, and (d) the estate of
such person (and his executor(s) or administrator(s)) and the heirs and
legatees thereof.


 


“Final Reclassification” means a
reclassification of the Company in which all Equity Securities are reclassified
into shares of Final Reclassification Stock in connection with a pending
transaction pursuant to Section 4(d) hereof, subject to the
provisions of such Section 4(d) relating to Governance Preferred
Stock.


 


“Final Reclassification Stock” means the single
class of voting common stock issued in exchange for Equity Securities in a
Final Reclassification pursuant to Section 4(d) hereof.


 


“Governance Preferred Stock” means the Series A
Voting Preferred Stock and the Series B Voting Preferred Stock.


 


“Governmental Entity” means any federal, state,
local or foreign court, legislative, executive or regulatory authority or
agency.


 


“Holdco Continuing Investors” means each of the
Series C Members under the Holdco LLC Agreement, individually or
collectively as the context requires.


 


“Holdco LLC Agreement” means the Operating
Agreement of Continuing Investor Holding Company, LLC, dated as of December 16,
2005, as such agreement may be amended from time to time.


 


“Independent Director” has the meaning given to
it in the Charter as in effect on the date hereof.


 


“Initial Secondary Offering” has the meaning
given in Section 4(e)(i).


 


“Initiating Holder” has the meaning given in Section 6(a).


 


46





















 


“Insight Midwest” means Insight Midwest, L.P.,
a Delaware limited partnership.


 


“Inspectors” has the meaning given in Section 7.


 


“IPO” means the initial offering by the Company
of Company Common Stock to the public pursuant to an effective registration
statement under the Securities Act of 1933, as then in effect, or any comparable
statement under any similar federal statute then in force.


 


“IRR Condition” has the meaning given in Section 4(a)(ii)(A).


 


“Liquidity Request” has the meaning given in Section 4(a)(ii).


 


“Management Representative” has the meaning
given in Section 9(a).


 


“Marketable Securities” means any equity
securities (i) of a class which are traded on a United States national
securities exchange or the NMS, and (ii) subject to the immediately
succeeding sentence, which the holder (or in the case of a proposed distribution
hereunder, the proposed distributees) (x) may sell to the general public
pursuant to a then effective registration statement under the Securities Act, (y)
has a right to cause the issuer to register under the Securities Act that is
substantially equivalent, taking into account the amount of such securities
held, to Carlyle’s right to cause such registration, or (z) may sell to
the general public under Rule 144 (subject only to volume limitations), in
each case without the necessity of any federal, state or local government
consent, approval or filing (other than any notice filings of the type required
pursuant to Section 16 or Rule 144(h) under the Securities Act)
and without violation of federal or state securities laws.  It is understood and agreed that (A) if
Carlyle has a right to sell to the general public pursuant to a then effective
registration statement under clause (ii)(x) above, then all of the holders or
distributees shall have substantially equivalent rights to sell, (B) if
Carlyle has any “demand registration rights,” then Mr. Knafel (or in the
event of Mr. Knafel’s death or incapacity such that he is unable to act Mr. Knafel’s
Representative) (acting on behalf of SRK and the SRK Related Parties) and Mr. Willner
(or in the event of Mr. Willner’s death or incapacity such that he is
unable to act Mr. Willner’s Representative) shall collectively have at
least half as many such rights as Carlyle has (rounded down, but in any event
at least one “demand registration right”), which rights shall have
substantially equivalent terms, (C) if Carlyle has any “piggyback
registration rights,” then all holders or distributees shall have substantially
equivalent such rights, except that Carlyle and other holders or distributees
that are “affiliates” under Rule 144 shall have cutback priority over any
holders or distributees that are not “affiliates” under Rule 144 and (D) if
clauses (B) and (C) above are satisfied, then clause (ii) above
shall also be deemed to be satisfied.


 


“Merger Agreement” has the meaning given in the
Recitals.


 


47





















 


“Mr. Knafel” means Sidney R. Knafel.


 


“Mr. Knafel’s Representative” means Mr. Knafel’s
personal representative or the executor or administrator of his estate.


 


“Mr. Willner” means Michael S. Willner.


 


“Mr. Willner’s Representative” means Mr. Willner’s
personal representative or the executor or administrator of his estate.


 


“MSW” means Michael S. Willner and his
Permitted Assignees.


 


“NMS” means the National Market System of the
National Association of Securities Dealers, Inc.


 


“Non-Recourse Loans” has the meaning given in Section 4(a)(ii)(D).


 


“Non-Voting Common Stock” means the Series E
Common Stock and the Series F Common Stock.


 


“Non-Voting Preferred Stock” means the Series C
Non-Voting Preferred Stock and the Series D Non-Voting Preferred Stock.


 


“Notice of Offer” has the meaning given in Section 2.


 


“Offer Price” has the meaning given in Section 2.


 


“Offer Terms” has the meaning given in Section 2.


 


“Other Eligible Sale Consideration” means
either of the following: (i) any escrow or like arrangement (including a
note payable to the Securityholders that is not covered by clause (ii) below)
securing indemnification obligations or contingent liabilities, provided
that such escrow or arrangement shall not constitute more than five percent of
the aggregate consideration in any Sale, Subsequent Sale, Drag-Along Sale or
other transaction, provided, further, that if Carlyle desires to
cause the parties hereto to agree to such an escrow or arrangement that would
constitute more than five percent but not more than ten percent of such
aggregate consideration, Carlyle may do so with the consent of Mr. Knafel
and Mr. Willner after consulting with them in good faith, in which event Mr. Knafel
and Mr. Willner will not withhold their consent to such request unless
they reasonably determine that such increased escrow amount is not necessary or
appropriate to maximize the value of the proposed transaction to the selling
Securityholders or (ii) any note payable to the Securityholders by the
purchaser or its affiliates after the consummation of the transaction that
expressly is not subject to a set-off or similar right by the purchaser in
respect of indemnification obligations or other contingent liabilities.


 


48





















 


“Parent” has the meaning given in the Recitals.


 


“Participation Level” has the meaning given in Section 4.1(e) of
the Charter.


 


“Partnership” means Insight Midwest.


 


“Partnership Agreement” means the Amended and
Restated Limited Partnership Agreement of the Partnership, dated as of January 5,
2001, as amended from time to time.


 


“Partnership Split-Up” has the meaning given in
Section 4(a)(iii).


 


“Permitted Assignee” means, (a) with
respect to any Person, any other Person directly or indirectly Controlling,
Controlled by or under common Control with such first Person and which Persons
have a relationship of economic interest parallel to their Control
relationship, in each case solely by virtue of having the power to direct the
affairs of and to benefit from the economic value of the Person by reason of
ownership, directly or indirectly, of at least 81% of the issued and
outstanding voting securities or other voting equity interests (including general
partnership interests and limited liability company membership interests) of
such Person and at least 81% of the economic interest in such Person and which
has agreed to be bound by this Agreement; (b) with respect to any
Securityholder that is a natural person, any other member of the Family Group
of such Securityholder which has agreed to be bound by this Agreement; (c) with
respect to any Securityholder that is a trust, any beneficiary of such trust
that is a member of the Family Group of the settlor of such trust and which has
agreed to be bound by this Agreement or any new or reconstituted trust the
settlor of which is the same as the settlor of the Transferring trust (or the
executor, administrator or personal representative of such settlor acting in
such settlor’s name) and the beneficiaries of which are members of the Family
Group of the settlor of such trust and which trust has agreed to be bound by
this Agreement; and (d) with respect to Carlyle, (i) any investment
entity that is an Affiliate of and is sponsored or managed by or under common
sponsorship or management with such Person or (ii) any general partner,
limited partner, stockholder or member of such Person.


 


“Permitted Transfer” has the meaning given in Section 1.


 


“Person” means any natural person, firm,
individual, partnership, joint venture, business trust, trust, association,
corporation, company or unincorporated entity.


 


“Piggyback Registration” has the meaning given
in Section 5(a).


 


“Preferred Stock” means the Series A
Voting Preferred Stock, the Series B Voting Preferred Stock, the Series C
Non-Voting Preferred Stock and the Series D Non-Voting Preferred Stock.


 


49





















 


“Principal Decisions” has the meaning given in Section 4(c)(i).


 


“Prior Proceeds” has the meaning given in Section 4(ii).


 


“Prohibited Transfer” means any Transfer of
Equity Securities to a Person that (t) would violate any other provision
of this Agreement, (u) would cause the Company and/or any Company
Subsidiary to be in violation of the Communications Act of 1934, as amended, or
the rules or regulations promulgated thereunder, (v) may not be
effected without registering the securities involved under the Securities Act,
(w) would result in the assets of the Company constituting “plan
assets” as such term is defined in the Department of Labor regulations
promulgated under the Employer Retirement Income Security Act of 1974, as
amended, (x) would cause the Company to be Controlled by or under
common Control with an “investment company” for purposes of the Investment
Company Act of 1940, as amended, (y) would require any securities
of the Company to be registered under the Exchange Act or would cause the
Company to be subject to Section 12(g) or 15(d) of the Exchange
Act or (z) the Board determines in good faith would result in a
change of control under an indenture or credit agreement to which the Company
or any of its Subsidiaries is a party or a transfer of control under the
Partnership Agreement, which change or transfer of control could reasonably be
expected to have material adverse consequences for the Company or the
Securityholders.


 


“Qualified Bank” has the meaning given in Section 4(a)(iv).


 


“Qualified IPO” means an IPO in connection with
which the Company has received a firm commitment for an underwritten public
offering of at least (i) $200,000,000 and (ii) 20% of the equity
value of the Company, to be listed on a nationally recognized exchange or
automated dealer quotation system; provided that any Company Common Stock
to be sold as part of an Initial Secondary Offering shall be included when
calculating the minimum thresholds set forth in clauses (i) and (ii) of
this definition; provided  further, that the Board has not
determined, in good faith, that such IPO would result in a change of control
under an indenture or credit agreement to which the Company or any of its
Subsidiaries is a party or a transfer of control under the Partnership
Agreement, which change or transfer of control could reasonably be expected to
have material adverse consequences for the Company or the Securityholders.


 


“Qualifying Distribution Transaction” has the
meaning given in Section 4(ii).


 


“Recap” has the meaning given in Section 4(a)(i)(c).


 


“Registrable Securities” means (a) (i) shares
of Company Common Stock held by a Securityholder, including any Final
Reclassification Stock issued pursuant to Section 4(e)(iii), and (ii) shares
of Company Common Stock issued or issuable upon exercise of outstanding options
therefor; and (b) any securities issued or issuable with respect to
any


 


50





















 


shares
of Company Common Stock referred to in the foregoing sub-clauses (x) upon
any conversion or exchange thereof, (y) by way of stock dividend or
other distribution, stock split or reverse stock split or (z) in
connection with a combination of shares, recapitalization, merger,
consolidation, exchange offer or other reorganization.  As
to any particular Registrable Securities, once issued such securities shall cease
to be Registrable Securities when (A) a registration statement with
respect to the sale of such securities shall have become effective under the
Securities Act and such securities shall have been disposed of in accordance
with such registration statement, unless such securities are acquired and held
by a Securityholder who is an affiliate (within the meaning of Rule 144 of
the Company), (B) such securities shall have been distributed to the
public in reliance upon Rule 144, (C) such securities shall have been
otherwise Transferred, new certificates for such securities not bearing a
legend restricting further Transfer shall have been delivered by the Company
and subsequent disposition of such securities shall not require registration or
qualification of such securities under the Securities Act or (D) such
securities shall have been acquired by the Company.


 


“Rule 144” means Rule 144 (or any
successor provision) promulgated under the Securities Act.


 


“Sale” has the meaning given in Section 4(a)(i)(B).


 


“Secondary Notice” has the meaning given in Section 4(e)(i).


 


“Section 2 Seller” has the meaning given
in Section 2.


 


“Section 3 Buyer” has the meaning given in
Section 3.


 


“Section 3 Closing” has the meaning given
in Section 3.


 


“Section 3 Seller” has the meaning given
in Section 3.


 


“Section 3 Seller Securities” has the
meaning given in Section 3.


 


“Securities Act” means the Securities Act of
1933, as amended, or any successor federal statute.


 


“Securityholders” has the meaning given in the
Preamble.


 


“Series A Securityholders” means each of
SRK, the SRK Related Parties and MSW, individually or collectively as the
context requires.


 


“Series B Securityholders” has the meaning
given in Section 4(d)(iii).


 


51





















 


“Series A Voting Preferred Stock” means
the Series A Voting Preferred Stock, par value $0.01 per share, of the
Company.


 


“Series B Voting Preferred Stock” means
the Series B Voting Preferred Stock, par value $0.01 per share, of the
Company.


 


“Series C Non-Voting Preferred Stock”
means the Series C Non-Voting Preferred Stock, par value $0.01 per share,
of the Company.


 


“Series D Non-Voting Preferred Stock”
means the Series D Non-Voting Preferred Stock, par value $0.01 per share,
of the Company.


 


“Series E Common Stock” means the Series E
Non-Voting Common Stock, par value $0.01 per share, of the Company.


 


“Series F Common Stock” means the Series F
Non-Voting Common Stock, par value $0.01 per share, of the Company.


 


“Special Registration” means the registration
of equity securities and/or options or other rights in respect thereof solely
on Form S-4 or S-8 or any successor form.


 


“SRK” means Sidney R. Knafel, ICI
Communications, Inc., Knafel Family Foundation, Estate of Susan Knafel and
each of their Permitted Assignees.


 


“SRK Related Parties” means (i) Andrew G.
Knafel, in his own capacity, and his Permitted Assignees and (ii) Andrew
G. Knafel, Joshua Rubenstein and William L. Scherlis, as trustees under the
Trust F/B/O Andrew G. Knafel, dated September 13, 1978; Trust F/B/O
Douglas R. Knafel, dated September 13, 1978; Trust F/B/O Andrew G. &
Douglas R. Knafel, dated July 16, 1976; and Trust F/B/O Douglas R. Knafel,
dated November 6, 1983, and each such trust’s Permitted Assignees.


 


“Strategic Buyer” means Comcast Corporation,
any other multiple system cable operator, any direct broadcast satellite
operator, any regional bell operating company and any incumbent local exchange
carrier.


 


“Subsequent Sale” has the meaning given in Section 4(a)(i)(B).


 


“Subsidiary” means, when used with respect to
any Person, any corporation or other organization, whether incorporated or
unincorporated, (i) of which such Person or any other Subsidiary of such
Person is a general partner (excluding partnerships, the general partnership
interests of which held by such Person or any Subsidiary of such Person do not
have a majority of the voting interests in such partnership) or (ii) at
least a majority of the securities or other interests of which having by their
terms ordinary voting power to elect a majority of the board of directors or
others performing similar functions


 


52





















 


with
respect to such corporation or other organization is directly or indirectly
owned or controlled by such Person or by any one or more of its Subsidiaries,
or by such Person and one or more of its Subsidiaries.  Without limiting any of the foregoing,
Subsidiaries of the Company shall be deemed to include Insight Midwest and its
Subsidiaries.


 


“Tag-Along Right” has the meaning given in Section 2.


 


“Transfer” has the meaning given in Section 1
and the terms “Transferred”, “Transferring”, Transferor”
and “Transferee” shall have correlative meanings.


 


“Valuation Test” has the meaning given in Section 4(a)(iii).


 


“Valuer” has the meaning given in Section 4(a)(iv).


 


“Voting Preferred Stock” means the Series A
Voting Preferred Stock and the Series B Voting Preferred Stock.


 


(s)           Amendments
to Holdco LLC Agreement.  Neither Mr. Knafel
nor Mr. Willner shall agree to the amendment or waiver of any provision of
the Holdco LLC Agreement without the prior written consent of Carlyle, which
consent will not be unreasonably withheld.


 


[Signatures on the following page]


 


53





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


	
   

  	
  CARLYLE PARTNERS III
  TELECOMMUNICATIONS,

  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:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:   Managing
  Director

  
	
   

  	
   

  
	
   

  	
  CP III COINVESTMENT, 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

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:   Managing
  Director

  
	
   

  	
   

  
	
   

  	
  CARLYLE PARTNERS IV
  TELECOMMUNICATIONS,

  L.P.

  
	
   

  	
  By:

  	
  TC Group IV, L.P., its
  General Partner

  
	
   

  	
  By:

  	
  TC Group IV, L.L.C., its
  General Partner

  
	
   

  	
  By:

  	
  TC Group, L.L.C., its
  Managing Member

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:   Managing
  Director

  
	
   

  	
   

  
	
   

  	
  CP IV COINVESTMENT, L.P.

  
	
   

  	
  By: 

  	
  TC Group IV, L.P., its
  General Partner

  
	
   

  	
  By: 

  	
  TC Group IV, L.L.C., its
  General Partner

  
	
   

  	
  By: 

  	
  TC Group, L.L.C., its
  Managing Member

  
	
   

  	
  By: 

  	
  TCG Holdings, L.L.C., its
  Managing Member

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:   Managing
  Director

  



 


Signature Page to
Securityholders Agreement


 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


	
   

  	
  INSIGHT COMMUNICATIONS
  COMPANY, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name: Michael S.
  Willner

  
	
   

  	
   

  	
  Title:
  President & Chief Executive Officer

  



 





















 


IN WITNESS WHEREOF, the parties have duly executed this
Securityholders Agreement by their authorized representatives as of the date
first above written.


 


	
   

  	
  CONTINUING INVESTOR
  SECURITYHOLDERS:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SIDNEY R. KNAFEL

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ICI COMMUNICATIONS,
  INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name: Sidney R. Knafel

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  KNAFEL FAMILY
  FOUNDATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name: Sidney R. Knafel

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ESTATE OF SUSAN KNAFEL

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name: Sidney R. Knafel

  
	
   

  	
   

  	
  Title: Executor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Address:

  	
  c/o Insight
  Communications, Inc.

  
	
   

  	
   

  	
  810 Seventh Avenue

  
	
   

  	
   

  	
  New York, NY 10019

  
								



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


	
   

  	
  CONTINUING INVESTOR
  SECURITYHOLDERS:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MICHAEL S. WILLNER

  
	
   

  	
  Address:

  	
  c/o Insight
  Communications, Inc.

  
	
   

  	
   

  	
  810 Seventh Avenue

  
	
   

  	
   

  	
  New York, NY 10019

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  ROBERT L. WINIKOFF, AS
  TRUSTEE,

  
	
   

  	
  DANIELLE A. WILLNER
  TRUST

  
	
   

  	
  DATED NOVEMBER 2,
  1998

  
	
   

  	
  Address:

  	
  c/o Sonnenschein Nath
  and Rosenthal LLP

  
	
   

  	
   

  	
  1221 Avenue of the
  Americas

  
	
   

  	
   

  	
  New York, NY 10020

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  ROBERT L. WINIKOFF, AS
  TRUSTEE,

  
	
   

  	
  MATTHEW S. WILLNER
  TRUST

  
	
   

  	
  DATED NOVEMBER 2,
  1998

  
	
   

  	
  Address:

  	
  c/o Sonnenschein Nath
  and Rosenthal LLP

  
	
   

  	
   

  	
  1221 Avenue of the
  Americas

  
	
   

  	
   

  	
  New York, NY 10020

  
				



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


	
   

  	
  CONTINUING INVESTOR
  SECURITYHOLDERS:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  ANDREW
  G. KNAFEL, AS TRUSTEE UNDER

  
	
   

  	
  TRUST
  F/B/O ANDREW G. KNAFEL DATED SEPTEMBER 13, 1978

  
	
   

  	
  TRUST
  F/B/O DOUGLAS R. KNAFEL DATED SEPTEMBER 13, 1978

  
	
   

  	
  TRUST
  F/B/O ANDREW G. & DOUGLAS R. KNAFEL DATED JULY   16,
  1976

  
	
   

  	
  TRUST
  F/B/O DOUGLAS R. KNAFEL DATED NOVEMBER 6, 1983

  
	
   

  	
  Address:

  	
  c/o Sidney Knafel

  
	
   

  	
   

  	
  SRK Management

  
	
   

  	
   

  	
  810 Seventh Avenue

  
	
   

  	
   

  	
  New York, NY  10019

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  ANDREW G. KNAFEL

  
	
   

  	
  Address:

  	
  c/o Sidney Knafel

  
	
   

  	
   

  	
  SRK Management

  
	
   

  	
   

  	
  810 Seventh Avenue

  
	
   

  	
   

  	
  New York, NY  10019

  
				



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


	
   

  	
  CONTINUING INVESTOR
  SECURITYHOLDER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  JAMES S. MARCUS

  
	
   

  	
  Address: 

  	
  720 Park Avenue

  
	
   

  	
   

  	
  New York, NY 10021

  
				



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


 


	
   

  	
  CONTINUING INVESTOR
  SECURITYHOLDERS

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  THOMAS L. KEMPNER

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NAN S. KEMPNER

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Thomas L. Kempner,
  Executor of

  
	
   

  	
   

  	
  Estate of Nan S.
  Kempner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THOMAS L. KEMPNER, AS
  TRUSTEE UNDER

  
	
   

  	
  TRUST F/B/O THOMAS
  KEMPNER CHILDREN

  
	
   

  	
  DATED MAY 19, 1964

  
	
   

  	
  TRUST F/B/O ALAN H.
  KEMPNER III

  
	
   

  	
  DATED NOVEMBER 7,
  1969

  
	
   

  	
  ALAN H. KEMPNER, JR. GRANTOR
  TRUST

  
	
   

  	
  DATED SEPTEMBER 4,
  1985

  
	
   

  	
  KEMPNER GRANDCHILDREN’S
  TRUST

  
	
   

  	
  DATED MAY 19, 1964

  
	
   

  	
  TRUST F/B/O THOMAS L.
  KEMPNER

  
	
   

  	
  (U/W CARL M. LOEB DATED
  JANUARY 3, 1955)

  
	
   

  	
  Address:

  	
  c/o Loeb Partners
  Corporation

  
	
   

  	
   

  	
  61 Broadway, 25th
  Fl.

  
	
   

  	
   

  	
  New York, NY 10006

  
						



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


	
   

  	
  CONTINUING INVESTOR
  SECURITYHOLDER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  JOHN ABBOT

  
	
   

  	
  Address:

  	
  c/o Insight
  Communications, Inc.

  
	
   

  	
   

  	
  810 Seventh Avenue

  
	
   

  	
   

  	
  New York, NY 10019

  
				



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


	
   

  	
  CONTINUING INVESTOR
  SECURITYHOLDER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  ELLIOT BRECHER

  
	
   

  	
  Address:

  	
  Insight
  Communications, Inc.

  
	
   

  	
   

  	
  810 Seventh Avenue

  
	
   

  	
   

  	
  New York, NY 10019

  
				



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


 


	
   

  	
  CONTINUING INVESTOR
  SECURITYHOLDER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  PAMELA EULER HALLING

  
	
   

  	
  Address:

  	
  c/o Insight
  Communications, Inc.

  
	
   

  	
   

  	
  810 Seventh Avenue

  
	
   

  	
   

  	
  New York, NY 10019

  
				



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


 


	
   

  	
  CONTINUING INVESTOR
  SECURITYHOLDER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MARY E. RHODES

  
	
   

  	
  Address:

  	
  3236 Ridge Brook Cir.

  
	
   

  	
   

  	
  Louisville, KY 40245

  
				



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


 


	
   

  	
  CONTINUING INVESTOR
  SECURITYHOLDER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  DANIEL MANNINO

  
	
   

  	
  Address:

  	
  c/o Insight
  Communications, Inc.

  
	
   

  	
   

  	
  810 Seventh Avenue

  
	
   

  	
   

  	
  New York, NY 10019

  
				



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


	
   

  	
  CONTINUING INVESTOR
  SECURITYHOLDER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  CHARLES E. DIETZ

  
	
   

  	
  Address:

  	
  c/o Insight
  Communications, Inc.

  
	
   

  	
   

  	
  810 Seventh Avenue

  
	
   

  	
   

  	
  New York, NY 10019

  
				



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


	
   

  	
  CONTINUING INVESTOR
  SECURITYHOLDER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  ELIZABETH M. GRIER

  
	
   

  	
  Address:

  	
  c/o Insight
  Communications, Inc.

  
	
   

  	
   

  	
  810 Seventh Avenue

  
	
   

  	
   

  	
  New York, NY 10019

  
				



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


 


	
   

  	
  CONTINUING INVESTOR
  SECURITYHOLDER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  HEATHER WRIGHT

  
	
   

  	
  Address:

  	
  c/o Insight
  Communications, Inc.

  
	
   

  	
   

  	
  810 Seventh Avenue

  
	
   

  	
   

  	
  New York, NY 10019

  
				



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


 


	
   

  	
  CONTINUING INVESTOR
  SECURITYHOLDER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  DANIEL MCCOMAS

  
	
   

  	
  Address:

  	
  11635 Tidewater Dr.

  
	
   

  	
   

  	
  Indianapolis, IN 46236

  
				



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


 


	
   

  	
  CONTINUING INVESTOR
  SECURITYHOLDER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  GREGORY B. GRAFF

  
	
   

  	
  Address:

  	
  2205 Arnold Palmer Blvd

  
	
   

  	
   

  	
  Louisville, KY 40245

  
				



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


 


	
   

  	
  CONTINUING INVESTOR
  SECURITYHOLDER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  JOHN W. HUTTON

  
	
   

  	
  Address:

  	
  5020 Lu Preese Ln

  
	
   

  	
   

  	
  Versailles, KY 40383

  
				



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


 


	
   

  	
  CONTINUING INVESTOR
  SECURITYHOLDER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  JAMES D. MORGAN

  
	
   

  	
  Address:

  	
  110 Turtlecove Lane

  
	
   

  	
   

  	
  Huntington, NY 11743

  
				



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


 


	
   

  	
  CONTINUING INVESTOR
  SECURITYHOLDER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  WALTER KELLEY

  
	
   

  	
  Address:

  	
  c/o Insight
  Communications, Inc.

  
	
   

  	
   

  	
  810 Seventh Avenue

  
	
   

  	
   

  	
  New York, NY 10019

  
				



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


 


	
   

  	
  CONTINUING INVESTOR SECURITYHOLDER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  MARA R. BANNARD

  
	
   

  	
  Address:

  	
  27 West 96 Street, 15E

  
	
   

  	
  New York, NY 10025

  
				



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


	
   

  	
  CONTINUING INVESTOR
  HOLDING COMPANY, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name: Michael S.
  Willner

  
	
   

  	
   

  	
  Title: Manager

  
	
   

  	
   

  	
  Address:

  	
  c/o Insight
  Communications

  
	
   

  	
   

  	
   

  	
  Company, Inc.

  
	
   

  	
   

  	
   

  	
  810 7th
  Avenue, 41st Floor

  
	
   

  	
   

  	
   

  	
  New York, New York
  10019

  
					



 





















 


IN WITNESS WHEREOF, the parties have duly executed
this Securityholders Agreement by their authorized representatives as of the
date first above written.


 


 


	
   

  	
  PH INVESTMENTS, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  
	
   

  	
   

  	
  Address:

  	
  Lewis Wharf

  
	
   

  	
   

  	
   

  	
  Boston, MA 02110

  
					



 





















 


Securityholders Agreement


 


Schedule A


 


Reference is made to the Securityholders Agreement,
dated as of December 16, 2005 (the “Securityholders Agreement”),
among Carlyle, the Company and those individuals named on the signature pages thereof.  The undersigned agrees, by execution hereof,
to become a party to, and to be subject to the rights and obligations under,
the Securityholders Agreement.


 


 


	
   

  	
   

  
	
  Name:

  	
   

  
	
  Title:

  	
   

  
	
   

  	
   

  
	
  Date:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Address:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  Acknowledged by:

  	
   

  
	
   

  	
   

  
	
  INSIGHT COMMUNICATIONS COMPANY, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
  Date: