Exhibit 10.4


 


SUBSCRIPTION AGREEMENT

(Grant of Series E Shares)


 


SUBSCRIPTION AGREEMENT, dated as of [             ],
2005 (the “Agreement”), between Insight Communications Company, Inc.,
a Delaware corporation (the “Company”), and the participant whose name
appears on the signature page hereof (the “Participant”).  (Capitalized terms used in this Agreement and
not defined herein shall have the meaning ascribed to such terms in the Insight
Communications Company, Inc. 2005 Stock Incentive Plan (the “Plan”)).


 


W  I
T  N  E  S  S  E  T  H:


 


WHEREAS, the Company and Insight Acquisition Corp.
have entered into an Agreement and Plan of Merger, dated as of July 28,
2005 (the “Merger Agreement”), pursuant to which Insight Acquisition
Corp. has merged with and into the Company (the “Merger”), with the
Company as the surviving corporation;


 


WHEREAS, prior to the date hereof, the Participant was
granted options (each an “Option” and collectively, the “Options”)
to purchase shares of common stock of the Company;


 


WHEREAS, upon consummation of the Merger all
outstanding Options were canceled in exchange for the right to receive a cash
payment equal to the excess, if any of the Per Share Merger Consideration (as
defined in the Merger Agreement) over the exercise price of the Options;


 


WHEREAS, pursuant to the Merger Agreement, the Company
agreed to grant to each Employee who held Options immediately prior to the
effective time of the Merger shares of Series E non-voting common stock,
par value $0.01 per share (the “Series E Shares”), of the Company
in consideration of the future services to be provided by such Employee
following the Merger; and


 


WHEREAS, the Board has adopted the Plan for the
purposes of, among other matters, granting such Series E Shares and has
approved the grant to the Participant of the aggregate number of shares (the “Shares”)
of Series E Shares set forth on Schedule A hereto, on the terms and
conditions set forth herein and in the Plan, and the Participant and the
Company desire to enter into this Agreement to evidence and confirm the grant
of such Shares.


 


NOW, THEREFORE, to implement the foregoing and in
consideration of the mutual agreements contained herein, the parties hereto
hereby agree as follows:


 


1.                                       Grant
of Series E Shares.  Subject to
the terms and conditions of this Agreement, the Securityholders Agreement and
the Plan, and subject to (i) the Participant


 





















 


becoming a party to the
Securityholders Agreement by executing and delivering to the Company a joinder
agreement in the form of Schedule A to the Securityholders Agreement if
the Participant is not already a party to such agreement and (ii) the
Participant’s delivery to the Company of duly executed and undated instruments
of transfer or assignment in blank, to be used by the Company only for transfers
required or permitted by the Plan, this Agreement or the Securityholders
Agreement, the Company hereby evidences and confirms its grant to the
Participant of the aggregate number of Series E Shares set forth on Schedule A
hereto.  Upon grant, one or more stock
certificates registered in the Participant’s name and representing the Shares,
which certificates shall bear the legends set forth in Section 8(b), will
be delivered on behalf of the Participant to the Secretary of the Company, to
be held in custody until the later of the date (i) they become
Vested Shares (as defined in Section 3) and (ii) the
Participant requests such instrument from the Company.


 


2.                                       Plan.  The Shares granted hereunder are being issued
pursuant to and in accordance with the Plan and, as such, are subject in all
respects to the Plan, all of the terms of which are made a part of and
incorporated into this Agreement.  In the
event of any conflict between any term of this Agreement and the terms of the
Plan, the terms of the Plan shall control.


 


3.                                       Vesting.  The Series E Shares granted hereunder (i) that
are designated “Vested Series E Shares” on Schedule A hereto shall be
fully vested on the Grant Date, and (ii) that are designated “Unvested
Series E Shares” on Schedule A hereto shall, subject to the continued
employment of the Participant by the Company or any Subsidiary thereof through
the applicable vesting date, vest either (A) on the “vesting date”,
if a date is specified on Schedule A hereto, or (B) in five
equal annual installments beginning on the first anniversary of the Grant Date
specified on Schedule A hereto.(1) 
Shares that are vested are referred to herein as “Vested Shares”.  The Shares shall be subject to forfeiture
prior to becoming Vested Shares as provided herein and in the Plan.


 










(1)          For SRK, all Shares are
immediately vested.


 


For MSW $11.75
Participation Level Shares:  Subject to
the continued employment of Participant by the Company or any subsidiary
thereof, (i) 10% of the Series E Shares are immediately vested, (ii)
80% of any such Series E Shares shall vest in four equal annual installments
beginning on the first anniversary of the Closing Date (as defined in the
Merger Agreement) and continuing on each anniversary thereof until the fourth
anniversary thereof, and (iii) the remaining 10% of any such Series E
Shares shall vest on the fifth anniversary of the Closing Date.


 


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4.                                       Participation
Level.  The Shares shall have the
Participation Levels specified on Schedule A hereto.


 


5.                                       Rights
and Restrictions.


 


(a)                                  Transfer
Restrictions.  The Participant shall
not 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 Series E Shares to any Person other than the Company, except as
provided in the Plan and except for Transfers of Vested Shares permitted under
the Securityholders Agreement.


 


(b)                                 Voting
Rights.  The Participant shall have
no voting rights except as set forth in the Charter or as may be required under
the General Corporation Law of the State of Delaware.  The Participant, by becoming a party to the
Securityholders Agreement, shall grant an irrevocable proxy to vote the
Participant’s Shares pursuant to section 11 thereof.


 


(c)                                  Other
Rights and Obligations. The Participant shall be entitled to the rights and
subject to the obligations created under the Plan and the Securityholders
Agreement, each to the extent set forth therein.


 


6.                                       Termination
of Services.  Notwithstanding
anything contained in this Agreement, the Plan or the Securityholders Agreement
to the contrary, if the Participant’s employment with the Company is terminated
for any reason, the Series E Shares granted to the Participant hereunder
shall be treated as set forth in this Section 6.


 


(a)                                  Due
to Death or Disability.  If the
Participant’s employment with the Company and its Subsidiaries is terminated by
reason of the Participant’s death or by the Company for Disability all unvested
Series E Shares then held by the Participant shall vest and the
Participant shall be entitled to retain all Series E Shares then held by
the Participant (after taking into account this paragraph), subject to the
terms and conditions of the Plan and the Securityholders Agreement.


 


(b)                                 For
Any Other Reason.  If the Participant’s
employment with the Company and its Subsidiaries is terminated for any reason
other than death or Disability, (A) all Vested Shares then held by
the Participant shall remain outstanding and shall remain subject to the terms
and conditions of the Plan and the Securityholders Agreement


 


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and (B) all
Series E Shares then held by the Participant that are not Vested Shares
shall be immediately forfeited without payment therefor.(2)


 


(c)                                  Repurchase
Right.(3)  Upon any termination of
the Participant’s employment with the Company and its Subsidiaries prior to a
Qualified IPO or a Sale of the Company, the Company shall have the right to
repurchase and the Participant shall have the obligation to sell all or any
portion of the Shares that remain outstanding and have not been forfeited or
canceled as a result of such termination or otherwise for a cash payment equal
to the Fair Market Value (as defined in the Plan) of the Shares as of the date
of such termination.  The Company shall
have 180 days from the date of such termination of the Participant’s employment
during which to give notice in writing to the Participant (or, in the event of
the Participant’s death, the Participant’s estate) of its election to exercise
the Company purchase option, in whole or in part, including the number of
Shares that it is electing to purchase. 
The closing of any purchase of Shares pursuant to this Section 6(c) shall
take place at the principal office of the Company on the tenth business day
following the receipt by the Participant (or the Participant’s estate) of
written notice of the Company of its exercise of the Company’s purchase option
pursuant to this Section 6(c).  At
the closing, (i) the Company shall pay to the Participant (or the
Participant’s estate) an amount equal to the purchase price and (ii) the
Participant (or the Participant’s estate) shall deliver to the Company such
certificates or other instruments with respect to the Shares so purchased,
appropriately endorsed by the Participant (or the Participant’s estate), as the
Company may reasonably require.


 


(d)                                 Application
of the Purchase Price to Certain Loans. 
The Participant agrees that the Company shall be entitled to apply, or
to direct the application of, any amounts to be paid by the Company to purchase
Shares pursuant to Section 6(c) to discharge any indebtedness of the
Participant to, or guaranteed by, the Company or any of its Subsidiaries.


 


7.                                       Sale
of the Company.  Subject to the
continued employment of the Participant with the Company or any Subsidiary,
upon a Sale of the Company, the Series E Shares shall be treated as set forth
in Article IX of the Plan.


 










(2)          For MSW add:  , provided that if the Participant’s
employment is terminated by the Company without Cause or by Participant for
Good Reason (as defined in the employment agreement between Participant and the
Company), all unvested Series E Shares then held by the Participant shall vest.


 


(3)          Will not apply to SRK or
MSW.


 


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8.                                       Participant’s
Representations, Warranties, Covenants and Agreements.


 


(a)                                  Investment
Intention.  The Participant
represents and warrants that the Participant is acquiring the Series E
Shares solely for the Participant’s own account for investment and not with a
view to or for sale in connection with any distribution thereof.  The Participant agrees that the Participant
will not, directly or indirectly, offer, transfer, sell, pledge, hypothecate or
otherwise dispose of any of the Series E Shares (or solicit any offers to
buy, purchase or otherwise acquire or take a pledge of any Series E
Shares), except in compliance with the Securities Act of 1933, as amended (the “Securities
Act”), and the rules and regulations of the Securities and Exchange
Commission (the “Commission”) thereunder, and in compliance with
applicable state and foreign securities or “blue sky” laws.  The Participant further understands,
acknowledges and agrees that none of the Series E Shares may be
transferred, sold, pledged, hypothecated or otherwise disposed of (i) unless
(A) such disposition is pursuant to an effective registration statement
under the Securities Act, (B) the Participant shall have delivered
to the Company an opinion of counsel, which opinion and counsel shall be
reasonably satisfactory to the Company, to the effect that such disposition is
exempt from the provisions of section 5 of the Securities Act, (C) a
no-action letter from the Commission, reasonably satisfactory to the Company,
shall have been obtained with respect to such disposition, or (D) following
a Qualified IPO, in an exempt transaction under Rule 144, (ii) unless
such disposition is pursuant to registration under any applicable state and
foreign securities laws or an exemption therefrom and (iii) unless
the applicable provisions of the Plan, this Agreement and the Securityholders
Agreement shall have been complied with or have expired.


 


(b)                                 Legends.  The Grantee acknowledges that any certificate
evidencing the Series E Shares granted pursuant to this Agreement shall
bear the following legends:


 


“THE SHARES OF COMMON 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 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


 


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OTHER PARTIES THERETO, A COPY OF WHICH IS ON FILE WITH
THE SECRETARY OF THE COMPANY.”


 


“THE SHARES REPRESENTED BY THIS CERTIFICATE ARE
SUBJECT TO (A) THE TRANSFER AND OTHER PROVISIONS OF A SUBSCRIPTION
AGREEMENT, DATED AS OF [    ,
2005]; AND (B) THE PROVISIONS
OF THE INSIGHT COMMUNICATIONS COMPANY, INC. 2005 STOCK INCENTIVE PLAN (THE “INCENTIVE
PLAN”) AND NEITHER THIS CERTIFICATE NOR THE SHARES REPRESENTED BY IT ARE
TRANSFERABLE EXCEPT IN ACCORDANCE WITH THE PROVISIONS OF THE SUBSCRIPTION
AGREEMENT AND THE INCENTIVE PLAN, COPIES OF WHICH ARE AVAILABLE FOR INSPECTION
AT THE OFFICES OF THE ISSUER.  NO
TRANSFER OF SUCH SHARES WILL BE MADE ON THE BOOKS OF THE ISSUER, AND SUCH
TRANSFER SHALL BE VOIDABLE, UNLESS ACCOMPANIED BY EVIDENCE OF COMPLIANCE WITH
THE TERMS OF SUCH PLAN AND AGREEMENTS.”


 


(c)                                  Securities
Law Matters.  The Participant
acknowledges receipt of advice from the Company that (i) the Series E
Shares have not been registered under the Securities Act or any state or
foreign securities or “blue sky” laws, (ii) it is not anticipated
that there will be any public market for the Series E Shares, (iii) the
Series E Shares must be held indefinitely and the Participant must
continue to bear the economic risk of the investment in the Series E
Shares unless the Series E Shares are subsequently registered under the
Securities Act and such state or foreign laws or an exemption from registration
is available, (iv) Rule 144 promulgated under the Securities
Act (“Rule 144”) is not presently available with respect to sales
of securities of the Company and the Company has made no covenant to make Rule 144
available, (v) when and if the Series E Shares may be disposed
of without registration in reliance upon Rule 144, such disposition can
generally be made only in limited amounts in accordance with the terms and
conditions of such rule, (vi) the Company does not plan to file
reports with the Commission or make information concerning the Company publicly
available unless required to do so by law or agreement, (vii) if
the exemption afforded by Rule 144 is not available, sales of the Series E
Shares may be difficult to effect because of the absence of public information
concerning the Company, (viii) restrictive legends in the form
heretofore set forth shall be placed on the certificates representing the Series E
Shares and (ix) a notation shall be made in the appropriate records
of the Company indicating that the Series E Shares are subject to
restrictions on transfer set forth in this Agreement (including, but not
limited to, the Securityholders Agreement as incorporated by reference herein)
and, if the Company should in the future engage the services of a stock
transfer agent, appropriate stop-transfer restrictions will be issued to such
transfer agent with respect to the Series E Shares.


 


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(d)                                 Compliance
with Rule 144.  If any of the Series E
Shares are to be disposed of in accordance with Rule 144, the Participant
shall transmit to the Company an executed copy of Form 144 (if required by
Rule 144) no later than the time such form is required to be transmitted
to the Commission for filing and such other documentation as the Company may
reasonably require to assure compliance with Rule 144 in connection with
such disposition.


 


(e)                                  Investor
Status.  The Participant represents
and warrants that, as of the date hereof, the Participant is an officer or
employee of the Company or a Subsidiary.


 


(f)                                    Restrictions
on Sale upon Public Offering.  The
Participant agrees that, in the event that the Company files a registration
statement under the Securities Act with respect to an underwritten public
offering of any Series E Shares, the Participant will not effect any
public sale (including a sale under Rule 144) or distribution of any Series E
Shares (other than as part of such underwritten public offering) during the 15
days prior to and the 180 days after the effective date of such registration
statement.


 


(g)                                 Options.  The Participant hereby consents to the
cancellation of the Participant’s Options in the Merger and hereby releases and
forever discharges and holds harmless the Company and each of its shareholders,
officers, directors, employees, agents and representatives from and against any
claim, liabilities or damage in connection therewith.


 


(h)                                 Section 83(b) Election.  The Participant agrees that, within 20 days
after the issuance of the Shares to the Participant, the Participant shall make
an election pursuant to section 83(b) of the Code, with respect to
the Series E Shares issued under this Agreement, and acknowledges that the
Participant will be solely responsible for any and all tax liabilities payable
by the Participant in connection with the Participant’s purchase and receipt of
the Series E Shares or attributable to the Participant’s failing to make
such an election.


 


9.                                       Representations
and Warranties of the Company.  The
Company represents and warrants to the Participant that (a) the
Company has been duly organized and is an existing limited liability company in
good standing under the laws of the State of Delaware, (b) this
Agreement has been duly authorized, executed and delivered by the Company and
constitutes a valid and legally binding obligation of the Company enforceable
against the Company in accordance with its terms, and (c) the Series E
Shares, when issued, delivered and paid for in accordance with the terms
hereof, will be duly and validly issued, fully paid and nonassessable.


 


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10.                                 Miscellaneous.


 


(a)                                  Binding
Effect; Benefits; Assignability. 
This Agreement shall be binding upon and inure to the benefit of the
parties to this Agreement and their respective successors, heirs, executors and
assigns.  Nothing in this Agreement,
express or implied, is intended or shall be construed to give any person other
than the parties to this Agreement or their respective successors, heirs,
executors or assigns any legal or equitable right, remedy or claim under or in
respect of any agreement or any provision contained herein.  Neither this Agreement nor any right, remedy,
obligation or liability arising hereunder or by reason hereof shall be
assignable by the Company or the Participant without the prior written consent
of the other party; provided that the Company shall have the right to
assign any and all rights under Section 6(c).


 


(b)                                 Amendment.  This Agreement may be amended, modified or
supplemented only by a written instrument executed by the Participant and the
Company.


 


(c)                                  Entire
Agreement.  This Agreement,
Securityholders Agreement, the Charter, and any employment agreement which the
Participant has entered into with the Company constitute the entire agreement
between the Participant and the Company with respect to the subject matter
hereof, and supersede all undertakings and agreements, whether oral or in
writing, previously entered into by the parties with respect thereto.


 


(d)                                 Tax
Withholding.  Whenever any cash or
other payment is to be made hereunder or with respect to the Shares, the
Company or any Subsidiary shall have the power to withhold an amount (in cash
or in Common Shares otherwise deliverable to Participant upon vesting)
sufficient to satisfy federal, state, and local withholding tax requirements
relating to such transaction and the Company or such Subsidiary may defer the
payment of cash or other payment until such requirements are satisfied.


 


(e)                                  No
Right to Continued Employment. 
Nothing in the Plan or this Agreement shall interfere with or limit in
any way the right of the Company or any of its Subsidiaries to terminate the
Participant’s employment at any time, or confer upon the Participant any right
to continue in the employ of the Company or any of its Subsidiaries.


 


(f)                                    Section and
Other Headings, etc.  The section and
other headings contained in this Agreement are for reference purposes only and
shall not affect the meaning or interpretation of this Agreement.


 


(g)                                 Counterparts.  This Agreement may be executed in any number
of counterparts, each of which shall be deemed to be an original and all of
which together shall constitute one and the same instrument.  The parties hereto agree to accept a signed
facsimile copy of this Agreement as a fully binding original.


 


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(h)                                 Applicable
Law.  THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE OF NEW YORK,
WITHOUT REGARD TO THE APPLICATION OF RULES OF CONFLICT OF LAW THAT WOULD APPLY
THE LAWS OF ANY OTHER JURISDICTION, EXCEPT TO THE EXTENT THAT THE CORPORATE LAW
OF THE STATE OF DELAWARE SPECIFICALLY AND MANDATORILY APPLIES.


 


—Signature page follows—


 


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IN WITNESS WHEREOF, the Company and the Participant
have executed this Agreement as of the date first above written.


 


	
   

  	
  INSIGHT COMMUNICATIONS

  COMPANY

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  PARTICIPANT

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  :

  	
   

  	
   

  
	
   

  	
   

  	
  Name: «Name»

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Address of the Participant:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  «Address»

  	
   

  



 


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Schedule A


 


Grant Date:(4)


 


	
  Number of Series E

  Shares Granted

  (1)

  	
   

  	
  Vested Series E Shares

  (2)

  	
   

  	
  Unvested Series E

  Shares

  (3)

  	
   

  	
  Vesting Date for Series

  E Shares Listed in

  Column (3) with

  Vesting Date

  (4)

  	
   

  	
  Participation Level

  (5)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 










(4)          December 16, 2005 for
initial grants.