Exhibit 10.37


 


SECOND
AMENDED AND RESTATED


 


 


STOCKHOLDERS’
AGREEMENT


 


 


BY AND
AMONG


 


 


Roller
Bearing Holding Company, Inc.,


 


Dr. Michael
J. Hartnett and


 


Hartnett
Family Investments, L.P.


 


AND


 


Whitney
RBHC Investor, LLC and


 


Whitney V,
L.P.


 


 


Dated as of
February 6, 2003


 





















 


TABLE OF
CONTENTS


 


	
  1.

  	
  DEFINITIONS

  
	
   

  	
  1.1

  	
  “Affiliate”

  
	
   

  	
  1.2

  	
  “Applicable
  Subordinated Debt”

  
	
   

  	
  1.3

  	
  “Board”

  
	
   

  	
  1.4

  	
  “Class C
  Preferred Stock”

  
	
   

  	
  1.5

  	
  “Class D
  Preferred Stock

  
	
   

  	
  1.6

  	
  “Common Stock”

  
	
   

  	
  1.7

  	
  “Control”

  
	
   

  	
  1.8

  	
  “Derivative
  Securities”

  
	
   

  	
  1.9

  	
  “Exercise Price”

  
	
   

  	
  1.10

  	
  “Hartnett
  Employment Agreement”

  
	
   

  	
  1.11

  	
  “Immediate Family”

  
	
   

  	
  1.12

  	
  “Indemnification
  Shares”

  
	
   

  	
  1.13

  	
  “Initial Public
  Offering”

  
	
   

  	
  1.14

  	
  “Management
  Services Agreement”

  
	
   

  	
  1.15

  	
  “Minimum
  Hartnett Ownership”

  
	
   

  	
  1.16

  	
  “Minimum
  Whitney Common Ownership”

  
	
   

  	
  1.17

  	
  “Minimum
  Whitney Ownership”

  
	
   

  	
  1.18

  	
  “Minimum
  Whitney Preferred Ownership”

  
	
   

  	
  1.19

  	
  “New Stock
  Purchase Agreement”

  
	
   

  	
  1.20

  	
  “Old Stock
  Purchase Agreement”

  
	
   

  	
  1.21

  	
  “Outstanding
  Common Shares”

  
	
   

  	
  1.22

  	
  “Permitted Transfer”

  
	
   

  	
  1.23

  	
  “Permitted
  Transferee”

  
	
   

  	
  1.24

  	
  “Person”

  
	
   

  	
  1.25

  	
  “Preferred Stock”

  
	
   

  	
  1.26

  	
  “Public Sale”

  
	
   

  	
  1.27

  	
  “RBCA”

  
	
   

  	
  1.28

  	
  “Sale of
  Business Transaction”

  
	
   

  	
  1.29

  	
  “Securities”

  
	
   

  	
  1.30

  	
  “Stock Purchase
  Agreement”

  
	
   

  	
  1.31

  	
  “Voting Power”

  
	
   

  	
  1.32

  	
  “Whitney IRR”

  
	
   

  	
  1.33

  	
  “Whitney Management”

  
	
   

  	
  1.34

  	
  “Whitney Notice
  Parties”

  
	
   

  	
  1.35

  	
  “Whitney Parties”

  
	
   

  	
  1.36

  	
  Additional
  Defined Terms

  
	
   

  	
   

  	
   

  
	
  2.

  	
  TRANSFER
  RESTRICTIONS

  
	
   

  	
  2.1

  	
  Legends

  
	
   

  	
  2.2

  	
  Restrictions on
  Transfer

  
	
   

  	
  2.3

  	
  Right of First Offer

  
	
   

  	
  2.4

  	
  Tag-Along Rights

  
	
   

  	
  2.5

  	
  Right to Compel Sale

  



 





















 


	
   

  	
  2.6

  	
  Securities of
  Transferees

  
	
   

  	
  2.7

  	
  Competitors

  
	
   

  	
  2.8

  	
  Transfers
  Not in Compliance Void

  
	
   

  	
  2.9

  	
  Termination

  
	
   

  	
   

  	
   

  
	
  3.

  	
  RIGHT OF
  FIRST OFFER; PARTICIPATION RIGHT

  
	
   

  	
  3.1

  	
  Right
  of First Offer and Participation Right as to New Securities

  
	
   

  	
  3.2

  	
  Exceptions
  to Right of First Offer and Participation Right

  
	
   

  	
  3.3

  	
  Right
  of First Offer on Subordinated Debt Issuances

  
	
   

  	
  3.4

  	
  Termination
  on Initial Public Offering

  
	
   

  	
   

  	
   

  
	
  4.

  	
  REGISTRATION
  RIGHTS

  
	
   

  	
  4.1

  	
  Piggyback
  Registration

  
	
   

  	
  4.2

  	
  Demand Registration

  
	
   

  	
  4.3

  	
  Covenants
  With Respect to Registration

  
	
   

  	
  4.4

  	
  Definition of
  Common Stock

  
	
   

  	
  4.5

  	
  Designation
  of Underwriters

  
	
   

  	
   

  	
   

  
	
  5.

  	
  SPECIAL WHITNEY PRIVILEGES

  
	
   

  	
  5.1

  	
  Whitney Board
  Designee

  
	
   

  	
  5.2

  	
  Whitney’s
  Written Consent

  
	
   

  	
  5.3

  	
  Whitney’s
  Right to Information

  
	
   

  	
   

  	
   

  
	
  6.

  	
  Affirmative
  Covenants

  
	
   

  	
  6.1

  	
  Preservation
  of Corporate Existence

  
	
   

  	
  6.2

  	
  Payment of
  Obligations

  
	
   

  	
  6.3

  	
  Compliance with Laws

  
	
   

  	
  6.4

  	
  Insurance

  
	
   

  	
  6.5

  	
  Books and Records

  
	
   

  	
  6.6

  	
  Recourse

  
	
   

  	
   

  	
   

  
	
  7.

  	
  TERMINATION; AMENDMENT;
  WAIVER

  
	
   

  	
  7.1

  	
  Termination;
  Amendment

  
	
   

  	
  7.2

  	
  Waiver

  
	
   

  	
   

  	
   

  
	
  8.

  	
  MISCELLANEOUS

  
	
   

  	
  8.1

  	
  Notices

  
	
   

  	
  8.2

  	
  Entire Agreement

  
	
   

  	
  8.3

  	
  Captions

  
	
   

  	
  8.4

  	
  No Third Party
  Beneficiary

  
	
   

  	
  8.5

  	
  Remedies Cumulative

  
	
   

  	
  8.6

  	
  Governing
  Law; Submission to Jurisdiction

  
	
   

  	
  8.7

  	
  Assignment

  
	
   

  	
  8.8

  	
  No
  Inconsistent Agreements

  
	
   

  	
  8.9

  	
  Counterparts

  



 


ii





















 


SECOND
AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT


 


This Second Amended and Restated Stockholder’s
Agreement, dated as of this 6th day of February, 2003, by and among
Roller Bearing Holding Company, Inc., a Delaware corporation (“Holdings”), Whitney RBHC Investor,
LLC, a Delaware limited liability company (“Whitney
Investor”) and Whitney V, L.P., a Delaware limited partnership (“Whitney V” and, collectively with
Whitney Investor, “Whitney”),
Dr. Michael J. Hartnett and Hartnett Family Investments, L.P., a Delaware
limited partnership (together with Dr. Michael J. Hartnett, “Hartnett” and together with Whitney,
collectively the “Initial Parties”
and individually an “Initial Party”)
and the Persons who by operation of Section 2.6 become a party hereto.


 


WHEREAS, Whitney is the owner of (i) 2,368,265
shares (the “Whitney Common Shares”)
of Class A Voting Common Stock of Holdings, par value $0.01 per share (“Class A Common Stock”), (ii) 230,000
shares (the “Whitney Class B Preferred
Shares”) of Class B Exchangeable Convertible Participating
Preferred Stock of Holdings, par value $0.01 per share (“Class B Preferred Stock”); and (iii) 809.49
shares (the “Whitney Class A Preferred
Shares”) of Class A Preferred Stock of Holdings, par value
$0.01 per share (“Class A Preferred
Stock”); and


 


WHEREAS, Hartnett is the owner of (a) (i) 100
shares (the “Hartnett Common Shares”)
of Class B Supervoting Common Stock of Holdings, par value $0.01 per share
(“Class B Common Stock”),
(ii) 198.92 shares of Class A Preferred Stock (the “Hartnett Class A Preferred Shares”
and (iii) 10,000 shares of Class B Preferred Stock (the “Hartnett Class B Preferred Shares,”
collectively with the Hartnett Common Shares and the Hartnett Class A
Preferred Shares the “Hartnett Shares”
and the Hartnett Shares collectively with the Whitney Shares, the “Shares”); and (b) (i) a
warrant to purchase 424,146 shares of Class B Common Stock at $1.00 per
share, (ii) a warrant to purchase 125,000 shares of Class B Common
Stock at $5.14 per share, (iii) an option to purchase 9,250 shares of Class A
Common Stock at $5.14 per share, and (iv) an option to purchase 166,667
shares of Class A Common Stock at $1.00 per share (collectively, the “Warrants”); and


 


WHEREAS, the Initial Parties entered into a
Stockholders’ Agreement (the “First
Stockholders’ Agreement”), dated December 18, 2000, setting
forth their agreements regarding certain matters relating to their ownership of
the Shares and the Warrants; and


 


WHEREAS, the Initial Parties entered into an Amended
and Restated Stockholders’ Agreement (the “Existing
Stockholders’ Agreement”), dated as of July 29, 2002, which
amended and restated the First Stockholders’ Agreement in its entirety; and


 


WHEREAS, the Initial Parties wish to amend and
restate the Existing Stockholders Agreement in the manner set forth herein.


 


NOW, THEREFORE, in consideration of the premises and
the mutual covenants and agreements hereinafter set forth and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and intending to be legally bound hereby, the parties hereto
agree as follows:


 





















 


1.  DEFINITIONS


 


As used herein, the following terms shall have the
meanings indicated:


 


1.1                                 “Affiliate” shall mean a Person
Controlled by, in Control of, or under common Control with, another Person.


 


1.2                                 “Applicable Subordinated Debt”
shall mean indebtedness of Holdings or any of its subsidiaries that (i) is
in an amount of not less than $50 million, (ii) is unsecured, and (iii) is
subordinated to all secured debt of Holdings and/or such subsidiary.


 


1.3                                 “Board” shall mean the Board of
Directors of Holdings.


 


1.4                                 “Class C Preferred Stock”
shall mean the Class C Redeemable Preferred Stock of Holdings, par value
$0.01 per share.


 


1.5                                 “Class D Preferred Stock shall
mean the Class D Preferred Stock of Holdings, par value $0.01 per share.


 


1.6                                 “Common Stock” shall mean (i) the
Class A Common Stock, (ii) the Class B Common Stock and (iii) any
other class or series of common stock of the Company authorized after the date
hereof.


 


1.7                                 “Control” (including the
correlative terms “Controlled by”, “in Control of” and “under common Control
with”), with respect to any Person, shall mean possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of
such Person, whether through the ownership of voting securities or by contract
or otherwise.


 


1.8                                 “Derivative Securities”
shall mean options, warrants (including the Warrants) and other rights to
subscribe for, and securities convertible into or exchangeable or exercisable
for, shares of Common Stock, including, but not limited to, the Class B
Preferred Stock.


 


1.9                                 “Exercise Price” shall
mean, as applicable, the exercise price of options, warrants (including the
Warrants) or rights to subscribe for shares of Common Stock and the
consideration payable upon the conversion or exchange of securities convertible
into or exchangeable for shares of Common Stock.


 


1.10                           “Hartnett Employment Agreement”
shall mean the Amended and Restated Employment Agreement, dated December 18,
2000, by and between RBCA and Hartnett.


 


1.11                           “Immediate Family,” with respect to
an individual, shall mean his brothers, sisters, spouse, children (including adopted
children), parents, parents-in-law, grandchildren, great grandchildren and
other lineal descendants and spouses of any of the foregoing.


 


1.12                           “Indemnification Shares” shall mean
any shares of Class A Preferred Stock issued by Holdings pursuant to Article 9
of the Old Stock Purchase Agreement, Article 8 of the New Stock Purchase
Agreement” or Article 8 of the Third Stock Purchase Agreement.


 


2





















 


1.13                           “Initial Public Offering” shall
mean the first underwritten public offering of equity securities of Holdings
pursuant to an effective registration statement under the Securities Act of
1933, as amended (the “Act”), for which Holdings receives not less than $50
million in net proceeds and following which there is a public market for the
securities so offered.


 


1.14                           “Management Services Agreement”
shall mean that certain Amended and Restated Management Services Agreement,
dated as of July 29, 2002, by and between Whitney & Co., a
Delaware Corporation, and RBCA.


 


1.15                           “Minimum Hartnett Ownership” when
stated as a percentage, shall mean the indicated percentage of all Outstanding
Hartnett Common Shares owned by the Hartnett Parties as of the date hereof and
always as adjusted to reflect any stock split, stock dividend,
reclassification, recapitalization or other transaction having a similar
effect.


 


1.16                           “Minimum Whitney Common Ownership”
when stated as a percentage, shall mean the indicated percentage of all Whitney
Common Shares owned by the Whitney Parties as of the date hereof (and for the
avoidance of doubt, excluding Common Stock that may be obtained upon conversion
of the Class B Preferred Stock) and always as adjusted to reflect any
stock split, stock dividend, reclassification, recapitalization or other transaction
having a similar effect.  For the purposes hereof and of Section 1.18
below, if the Whitney Parties dispose of any shares of Class A Common
Stock, the first shares of Class A Common Stock actually disposed of shall
be deemed to be Common Stock obtained upon conversion of the Class B
Preferred Stock (and not the Whitney Common Shares or otherwise).


 


1.17                           “Minimum Whitney Ownership” when
stated as a percentage, shall mean the indicated percentage of all Outstanding
Whitney Common Shares owned by the Whitney Parties as of the date hereof, other
than shares of Class A Preferred stock purchased pursuant to the Third
Stock Purchase Agreement, and always as adjusted to reflect any stock split,
stock dividend, reclassification, recapitalization or other transaction having
a similar effect.


 


1.18                           “Minimum Whitney Preferred
Ownership” when stated as a percentage, shall mean the indicated percentage of
each of (i) the Shares of Class A Common Stock into which the Class B
Preferred Stock have been converted, and (ii) the Whitney Class B
Preferred Shares, which for the purposes hereof shall be deemed to be all (A) Class B
Preferred Stock and (B) Class C Preferred Stock and Class D
Preferred Stock, in each case owned by the Whitney Parties, each as of the date
hereof and always as adjusted to reflect any stock split, stock dividend,
reclassification, recapitalization or other transaction having a similar
effect.  Further, for the purposes hereof, the Whitney Parties shall be
deemed not to have transferred any shares of such Preferred Stock, which shall
have been redeemed by Holdings.


 


1.19                           “New Stock Purchase Agreement”
shall mean that certain Stock Purchase Agreement by and between Holdings and
Whitney V, dated as of July 25, 2002.


 


1.20                           “Old Stock Purchase Agreement”
shall mean that certain Stock Purchase Agreement dated as of November 20,
2000, among the Corporation, Michael J. Hartnett, Hartnett Family Investments,
L.P. and Whitney Acquisition II, Inc.


 


3





















 


1.21                           “Outstanding Common Shares” including subsets
of such terms such as “Outstanding Whitney Common Shares” or “Outstanding
Hartnett Common Shares,” shall mean all Common Stock that may be issued by
Holdings or its successors upon conversion, exchange or exercise of any shares
of Common Stock, Warrants or other Derivative Securities, including the Class B
Preferred Stock.


 


1.22                           “Permitted Transfer” shall mean a
Transfer to a Permitted Transferee.


 


1.23                           “Permitted Transferee” shall mean,
with respect to any Person, (a) if such Person is an individual, (i) a
member of the Immediate Family of such Person, (ii) a trust or other
similar legal entity for the primary benefit of such Person and/or one or more
members of his Immediate Family, or (iii) a partnership, limited
partnership, limited liability company, corporation or other entity in which
such Person alone or together with members of his Immediate Family possess 100%
of the outstanding voting securities, (b) a Person to whom Securities are
Transferred in compliance with Rule 144 under the Act, so long as Holdings
is furnished with evidence reasonably satisfactory to it that such Transfer
complied with such rule, (c) if such Person is not a natural person, (i) any
Affiliate of such Person or (ii) any of such Person’s Affiliates,
stockholders, general partners, limited partners, members, directors, officers,
or employees or their respective Affiliates to whom Securities are Transferred,
(d) Transferees pursuant to an effective registration statement under the
Act and (e) with respect to Whitney only, a financial institution or
institutions who are pledged the Whitney Securities as Collateral Security on
the date hereof.


 


1.24                           “Person” shall mean any natural
person, corporation, organization, partnership, association, joint-stock
company, limited liability company, joint venture, trust or government, or any
agency or political subdivision of any government.


 


1.25                           “Preferred Stock” shall mean all
outstanding Class A Preferred Stock, Class B Preferred Stock, Class C
Preferred Stock and Class D Preferred Stock.


 


1.26                           “Public Sale” shall mean any sale
of Securities to the public pursuant to an offering registered under the Act or
to the public effected through a broker, dealer or market pursuant to the
provisions of Rule 144 (other than 144(k)) (if such rule is
available) under the Securities Act (or any similar rule or rules in
effect).


 


1.27                           “RBCA” shall mean Roller Bearing
Company of America, Inc., a Delaware corporation and a wholly-owned
subsidiary of Holdings.


 


1.28                           “Sale of Business Transaction”
shall mean a transaction involving a sale of all or substantially all of the
capital stock of Holdings, a sale of all or substantially all of the assets of
Holdings and its subsidiaries or a merger, consolidation, recapitalization or
other transaction having a substantially similar result.


 


1.29                           “Securities” including subsets of such terms
such as “Whitney Securities” or “Hartnett Securities,” shall mean the Shares
and the Warrants, as well as (a) any shares of capital stock or Derivative
Securities that may be issued by Holdings or its successors and owned by any of
the Parties, and (b) any shares of capital stock that may be issued by
Holdings or its successors to any of the Parties upon conversion, exchange or
exercise of any shares of Common


 


4





















 


Stock,
Warrants, Preferred Stock or other Derivative Securities, in each case whether
currently owned or hereinafter acquired.


 


1.30                           “Third Stock Purchase Agreement”
shall mean that certain Preferred Stock Purchase Agreement by and among
Holdings, RBCA, Hartnett and Whitney V, dated as of the date hereof.


 


1.31                           “Voting Power” shall mean the right
to vote for directors and other matters that are the subject of a vote of the
stockholders of Holdings.


 


1.32                           “Whitney IRR” shall mean as of any
date of determination, the annualized internal rate of return realized by the
Whitney Parties as a result of their investment in Class A Common Stock
and Class B Preferred Stock pursuant to the Old Stock Purchase Agreement
and the New Stock Purchase Agreement through such date of determination (it
being understood that any proceeds received by the Whitney Parties in respect
of the shares of Class C Preferred Stock, Class D Preferred
Stock  and/or Class A Common Stock issued in respect of the Class B
Preferred Stock shall be included in the calculation of the Whitney IRR). 
For the avoidance of doubt, (i) all “Closing Fees” paid to Whitney &
Co. on the date of the Existing Stockholders’ Agreement pursuant to Section 3(b) of
the Management Services Agreement, and (ii) $300,000 per year of the
annual “Advisory Fees” payable to Whitney & Co. from and after the
date of the Existing Stockholders’ Agreement pursuant to Section 3(a) of
the Management Services Agreement (so long as the amount of such annual “Advisory
Fees” equals or exceeds $450,000 per year) shall be included in the calculation
of the Whitney IRR, and all other fees or expenses paid to Whitney &
Co. pursuant to the Management Services Agreement shall be excluded from such
calculation.


 


1.33                           “Whitney Management” means Whitney &
Co., a Delaware Corporation.


 


1.34                           “Whitney Notice Parties” means (a) for
so long as the Whitney Securities are held by Whitney and its Permitted
Transferees, Whitney Management, and (b) if any Whitney Securities are
owned by Persons other than Whitney and its Permitted Transferees, (i) Whitney
Management on behalf of Whitney and its Permitted Transferees, and (ii) each
of the other holders of Whitney Securities.


 


1.35                           “Whitney Parties” shall mean
Whitney Investor, Whitney V, Whitney Management and their respective Affiliates
and Permitted Transferees.


 


1.36                           Additional Defined Terms 


 


The
following terms are defined elsewhere in this Agreement in the Sections and on
the pages indicated:


 


	
  Defined
  Term

  	
   

  	
  Section

  
	
   

  	
   

  	
   

  
	
  Act

  	
   

  	
  1.13

  
	
  Affiliate

  	
   

  	
  1.1

  
	
  Applicable
  Subordinated Debt

  	
   

  	
  1.2

  
	
  Board

  	
   

  	
  1.3

  



 


5





















 


	
  Defined
  Term

  	
   

  	
  Section

  
	
   

  	
   

  	
   

  
	
  Board
  Meetings

  	
   

  	
  5.1(g)

  
	
  Call
  Option

  	
   

  	
  2.2

  
	
  Call
  Option Transfer

  	
   

  	
  2.2

  
	
  Class A
  Common Stock

  	
   

  	
  Recitations

  
	
  Class B
  Common Stock

  	
   

  	
  Recitations

  
	
  Class A
  Preferred Stock

  	
   

  	
  Recitations

  
	
  Class B
  Preferred Stock

  	
   

  	
  Recitations

  
	
  Commission

  	
   

  	
  4.2(a)

  
	
  Common
  Stock

  	
   

  	
  1.6

  
	
  Company

  	
   

  	
  2.1

  
	
  Compelled
  Sale

  	
   

  	
  2.5(a)

  
	
  Compelled
  Sale Notice

  	
   

  	
  2.5(a)

  
	
  Compelled
  Sale Purchaser

  	
   

  	
  2.5(a)

  
	
  Compelled
  Sale Transferor

  	
   

  	
  2.5(a)

  
	
  Competitor

  	
   

  	
  2.7(a)

  
	
  Control

  	
   

  	
  1.7

  
	
  Controlled
  by

  	
   

  	
  1.7

  
	
  Counter-Offer
  Terms

  	
   

  	
  3.1(a)(ii)

  
	
  Demanding
  Holders

  	
   

  	
  4.2(a)

  
	
  Demand
  Notice

  	
   

  	
  4.2(a)

  
	
  Demand
  Registration Period

  	
   

  	
  4.3(a)

  
	
  Demand
  Registration Statement

  	
   

  	
  4.2(a)

  
	
  Demand
  Securities

  	
   

  	
  4.2(a)

  
	
  Derivative
  Securities

  	
   

  	
  1.8

  
	
  Designees

  	
   

  	
  5.1(d)

  
	
  Exchange
  Act

  	
   

  	
  4.3(d)

  
	
  Exercise
  Price

  	
   

  	
  1.9

  
	
  Existing
  Stockholders’ Agreement

  	
   

  	
  Recitations

  
	
  First
  Offer Election

  	
   

  	
  2.3(b)

  
	
  First
  Offer Notice

  	
   

  	
  2.3(a)

  
	
  First
  Offer Terms

  	
   

  	
  2.3(b)

  
	
  GAAP

  	
   

  	
  6.2(a)

  
	
  Hartnett

  	
   

  	
  Introduction

  
	
  Hartnett
  Acceptance Notice

  	
   

  	
  2.3(c)

  
	
  Hartnett
  Class B Preferred Shares

  	
   

  	
  Recitations

  
	
  Hartnett
  Common Shares

  	
   

  	
  Recitations

  
	
  Hartnett
  Designees

  	
   

  	
  5.1(d)

  
	
  Hartnett
  Employment Agreement

  	
   

  	
  1.10

  
	
  Hartnett
  Parties

  	
   

  	
  2.3

  
	
  Hartnett
  Preemptive Parties

  	
   

  	
  3.1(b)(ii)

  
	
  Hartnett
  Securities

  	
   

  	
  1.29

  
	
  Hartnett
  Shares

  	
   

  	
  Recitations

  
	
  Holdings

  	
   

  	
  Introduction

  
	
  Holdings
  Response

  	
   

  	
  3.1(a)(ii)

  
	
  Immediate
  Family 

  	
   

  	
  1.11

  



 


6





















 


	
  Defined
  Term

  	
   

  	
  Section

  
	
   

  	
   

  	
   

  
	
  in
  Control of

  	
   

  	
   

  
	
  Indemnification
  Shares

  	
   

  	
  1.12

  
	
  Indemnified
  Parties

  	
   

  	
  4.3(d)

  
	
  Indemnifying
  Party

  	
   

  	
  4.3(f)

  
	
  Independent
  Director

  	
   

  	
  5.1(c)(iii)

  
	
  Initial
  Parties

  	
   

  	
  Introduction

  
	
  Initial
  Party

  	
   

  	
  Introduction

  
	
  Initial
  Public Offering

  	
   

  	
  1.13

  
	
  Initiating
  Notice

  	
   

  	
  2.5(a)

  
	
  Investment
  Bank

  	
   

  	
  2.5(b)

  
	
  Joinder
  Agreement

  	
   

  	
  2.6(d)

  
	
  Killian

  	
   

  	
  5.1(b)(iii)

  
	
  Management
  Services Agreement

  	
   

  	
  1.14

  
	
  Minimum
  Hartnett Ownership

  	
   

  	
  1.15

  
	
  Minimum
  Whitney Common Ownership

  	
   

  	
  1.16

  
	
  Minimum
  Whitney Ownership

  	
   

  	
  1.17

  
	
  Minimum
  Whitney Preferred Ownership

  	
   

  	
  1.18

  
	
  New
  Issue Notice

  	
   

  	
  3.1(a)

  
	
  New
  Issue Terms

  	
   

  	
  3.1(a)(i)

  
	
  New
  Securities

  	
   

  	
  3.1

  
	
  New
  Stock Purchase Agreement

  	
   

  	
  1.19

  
	
  Old
  Stock Purchase Agreement

  	
   

  	
  1.20

  
	
  Other
  Parties

  	
   

  	
  2.5(a)

  
	
  Outstanding
  Common Shares

  	
   

  	
  1.21

  
	
  Outstanding
  Hartnett Common Shares

  	
   

  	
  1.21

  
	
  Outstanding
  Whitney Common Shares

  	
   

  	
  1.21

  
	
  Participation
  Right

  	
   

  	
  Recitations

  
	
  Permitted
  Transfer

  	
   

  	
  1.22

  
	
  Permitted
  Transferee

  	
   

  	
  1.23

  
	
  Person

  	
   

  	
  1.24

  
	
  Piggyback
  Shares

  	
   

  	
  4.1

  
	
  Preemptive
  Issuance

  	
   

  	
  3.1(b)

  
	
  Preemptive
  Parties

  	
   

  	
  3.1(b)

  
	
  Public
  Sale

  	
   

  	
  1.26

  
	
  RBCA

  	
   

  	
  1.27

  
	
  Registered
  Securities

  	
   

  	
  4.3(c)(ii)(D)

  
	
  Registering
  Parties

  	
   

  	
  4.1

  
	
  Registration
  Statement

  	
   

  	
  4.1

  
	
  Required
  Holders

  	
   

  	
  2.3(b)

  
	
  Right
  of First Offer

  	
   

  	
  3.1(a)(ii)

  
	
  Sale
  of Business Transaction

  	
   

  	
  1.28

  
	
  Securities

  	
   

  	
  Recitations

  
	
  Shares

  	
   

  	
  Recitations

  
	
  Tag-Along
  Notice

  	
   

  	
  2.4(c)

  
	
  Tag-Along
  Notice Deadline

  	
   

  	
  2.4(c)

  



 


7





















 


	
  Defined
  Term

  	
   

  	
  Section

  
	
   

  	
   

  	
   

  
	
  Tag-Along
  Offer Notice

  	
   

  	
  2.4(c)

  
	
  Tag-Along
  Party

  	
   

  	
  2.4(a)

  
	
  Tag-Along
  Right

  	
   

  	
  2.4(a)

  
	
  Tag-Along
  Transferee

  	
   

  	
  2.4(a)

  
	
  Tag-Along
  Transferee Terms

  	
   

  	
  2.4(c)

  
	
  Tag-Along
  Transferor

  	
   

  	
  2.4(a)

  
	
  Third
  Party Securities

  	
   

  	
  4.1

  
	
  Third
  Stock Purchase Agreement

  	
   

  	
  1.30

  
	
  Third
  Whitney Designee

  	
   

  	
  5.1(a)

  
	
  Transfer

  	
   

  	
  2.2

  
	
  under
  common Control with

  	
   

  	
  1.7

  
	
  Underwriter’s
  Cutback

  	
   

  	
  4.1

  
	
  Voting
  Power

  	
   

  	
  1.31

  
	
  Warrants

  	
   

  	
  Recitations

  
	
  Whitney

  	
   

  	
  Introduction

  
	
  Whitney
  Class B Preferred Shares

  	
   

  	
  Recitations

  
	
  Whitney
  Common Shares

  	
   

  	
  Recitations

  
	
  Whitney
  Counter-Offer

  	
   

  	
  3.1(a)(ii)

  
	
  Whitney
  Designees

  	
   

  	
  5.1(d)

  
	
  Whitney
  Investor

  	
   

  	
  Introduction

  
	
  Whitney
  IRR

  	
   

  	
  1.32

  
	
  Whitney
  Management

  	
   

  	
  1.33

  
	
  Whitney
  Notice Parties

  	
   

  	
  1.34

  
	
  Whitney
  Parties

  	
   

  	
  1.35

  
	
  Whitney
  Securities

  	
   

  	
  1.29

  
	
  Whitney
  V

  	
   

  	
  Recitations

  



 


2.  TRANSFER
RESTRICTIONS


 


2.1  Legends.


 


None of the Securities, including the shares of
Common Stock underlying the Warrants and Class B Preferred Stock, have been
registered under the Act.  Certificates representing the Shares, the
Warrants, and upon exercise of the Warrants, the shares of Common Stock
issuable in connection therewith, in each case, issued on or after the date
hereof, shall bear the following legend:


 


The securities represented
by this certificate have not been registered under the Securities Act of 1933,
as amended (“Act”), and
may not be offered or sold except pursuant to (i) an effective
registration statement under the Act or (ii) an exemption from
registration under such Act.


 


The securities represented
by this certificate are subject to the restrictions contained in a Second
Amended and Restated Stockholders’ Agreement, dated as of February 6,
2003, by and


 


8





















 


among the issuer of such
securities (the “Company”)
and certain of the Company’s stockholders as such agreement may be amended from
time to time.  A copy of such stockholders’ agreement shall be furnished
without charge by the Company to the holder hereof upon written request.


 


The
legend set forth above shall be removed from the certificates evidencing any
Securities upon Transfer pursuant to a Public Sale.


 


2.2  Restrictions on
Transfer.


 


No Party shall, directly or indirectly, voluntarily
or involuntarily, sell, assign, gift, transfer, pledge, mortgage, hypothecate
or otherwise dispose of (each such event, a “Transfer”) any Securities other than (a) Transfers
to Permitted Transferees, (b) transfers of Class A Preferred Stock to
Holdings upon the exercise by Holdings of the call option (the “Call Option”) provided in Section 9.01(a) of
the Third Stock Purchase Agreement (“Call
Option Transfers”), and (c) Transfers in compliance with
the provisions of this Article 2.


 


2.3  Right of First Offer.


 


So long as the Minimum Whitney Common Ownership is
at least twenty percent (20%), neither Hartnett nor any of his Permitted
Transferees (the “Hartnett Parties”)
may Transfer any Securities except in compliance with this Section 2.3.


 


(a) 
If any Hartnett Party desires to Transfer Securities, he shall give notice
thereof to the Whitney Notice Parties (a “First
Offer Notice”).  The First Offer Notice shall include the
number and type of Securities that are to be the subject of the Transfer and,
to the extent then known, the proposed process applicable to the Transfer and
the intended timing of such Transfer.


 


(b) 
The holders of a majority of the Whitney Common Shares (the “Required Holders”) shall have the
right, but not the obligation, exercisable at any time within thirty (30) days
after delivery of the First Offer Notice, to deliver in writing to the Hartnett
Party an offer to purchase all, but not less than all, of such Securities (the “First Offer Election”) setting forth
the material terms and conditions on which it proposes to purchase such
Securities (the “First Offer Terms”).


 


(c) 
The Hartnett Party shall have a period of ten (10) days after the delivery
of the First Offer Election in which to accept or reject the offer by the
Required Holders on the First Offer Terms.  Notice of such acceptance
shall be referred to as the “Hartnett
Acceptance Notice.”


 


(d) 
Upon the acceptance of any such offer pursuant to (b) above, the Required
Holders shall designate a date to purchase the Securities to be acquired, which
date shall be not less than five (5) days following the date on which the
Required Holders notify the Hartnett Party thereof and not more than thirty
(30) days following delivery of the Hartnett Acceptance Notice, at which time
the Required Holders shall deliver payment in the appropriate amount to the
Hartnett Party against (i) delivery of certificates or other instruments
representing the


 


9





















 


Securities
to be purchased, appropriately endorsed by the Hartnett Party and (ii) completion
of all documentation necessary to satisfy all of the First Offer Terms.


 


(e) 
If the Required Holders do not make a First Offer Election or if the Hartnett
Party has not accepted the offer embodied in the First Offer Notice within the
ten (10) day period set forth in subparagraph (b) above, the Hartnett
Party shall have the unlimited right at his option, at any time within the one
hundred eighty (180) days following the date of the First Offer Notice to sell
all of the Securities that were the subject of the First Offer Notice free of
any obligation to sell any of such Securities to the Required Holders;
provided, however, that, if the Required Holders shall have made a First Offer
Election but the Hartnett Party did not accept such offer as aforesaid, the per
share price in such sale shall not be less than the per share price contained
in the First Offer Terms.  Any subsequent or other proposed Transfer shall
be subject to the rights of first offer set forth herein.


 


(f) 
Notwithstanding any provision of this Section 2.3 to the contrary, if the
exercise by any holder of Whitney Securities of its Right of First Offer would
cause the Voting Power (on a fully-diluted basis, including in respect of all
Derivative Securities) which all of the holders of the Whitney Securities own,
directly or indirectly, to exceed forty-nine and nine-tenths percent (49.9%) of
the Voting Power of the Common Stock (on a fully-diluted basis, including in
respect of all Derivative Securities), then such holders of Whitney Securities
agrees that that portion of the Securities so exceeding such forty-nine and
nine-tenths percent (49.9%) threshold shall be replaced with a different class
of Securities without any voting rights whatsoever (but in all other respects
identical to the Securities offered pursuant to this Section 2.3). 
Each of the Parties covenants and agrees that it shall take all measures
required to carry out the foregoing, including approval of any required
amendment to the Certificate of Incorporation of Holdings.


 


(g) 
Notwithstanding anything contained herein to the contrary, this Section 2.3
shall not apply to: (i) any Transfer or series of related Transfers of
Securities by the Hartnett Parties that, in the aggregate, together with all
other Transfers subject to the exception set forth in this subsection (g)(i),
constitute Minimum Hartnett Ownership of less than ten percent (10%), (ii) Transfers
to Permitted Transferees, (iii) Call Option Transfers, and (iv) Transfers
with respect to which the Hartnett Transferors have exercised a right to compel
sale pursuant to Section 2.5.


 


2.4  Tag-Along Rights.


 


(a) 
If Hartnett or any of his Permitted Transferees (the “Tag-Along Transferor”) wishes to
transfer Securities owned by such Person (in a transaction in which, if subject
to the provisions of Section 2.3, such Person shall not have accepted the
offer, if any, by the holders of the Whitney Securities to purchase such
Securities) to any Person other than a Permitted Transferee (a “Tag-Along Transferee”), each Party
other than the Tag-Along Transferor and his Permitted Transferees (each such
Party, a “Tag-Along Party”)
shall have the right (the “Tag-Along
Right”) to require, as a condition to such Transfer by the
Tag-Along Transferor of such Securities, that the Tag-Along Transferee purchase
from such Tag-Along Party, at the same price and on the same terms and
conditions as involved in the Transfer by the Tag-Along Transferor, up to that
number of Outstanding Common Shares owned by such Tag-Along Party equaling the


 


10





















 


number
derived by multiplying (i) the total number of Outstanding Common Shares
owned by such Tag-Along Party by (ii) a fraction (A) the numerator of
which is the actual number of Outstanding Common Shares to be Transferred to
the Tag-Along Transferee by the Tag-Along Transferor as set forth in the
Tag-Along Offer Notice and (B) the denominator of which is the aggregate
number of Outstanding Common Shares owned by Hartnett and his Permitted
Transferees immediately prior to such Transfer.  Notwithstanding the
foregoing, in the event the Tag-Along Transferee is unwilling to purchase the
sum of the aggregate number of Securities that the Tag-Along Transferor and the
Tag-Along Parties (and each of them) desire to Transfer to the Tag-Along
Transferee pursuant hereto, the Tag-Along Transferor and each Tag-Along Party
who desires to Transfer Securities to the Tag-Along Transferee shall be
entitled to Transfer only that number of Outstanding Common Shares equal to the
number of Outstanding Common Shares which such Party desires to Transfer to
such Tag-Along Transferee, as set forth in its Tag-Along Notice or, in the case
of the Tag-Along Transferor, in the Tag-Along Offer Notice, multiplied by a
fraction, the numerator of which is the total number of Outstanding Common
Shares which the Tag-Along Transferee is willing to acquire and the denominator
of which is the total number of Outstanding Common Shares which the Tag-Along
Transferor and all of the Tag-Along Parties wish to Transfer to such Tag-Along
Transferee (all as set forth, as applicable, in the Tag-Along Offer Notice and
the Tag-Along Notices).


 


(b) 
Unless the Tag-Along Transferee shall agree to the contrary, prior to any
Transfer to the Tag-Along Transferee, the Tag-Along Transferor and the
Tag-Along Parties shall exercise, convert or exchange such number of their
Derivative Securities as may be necessary so that only shares of Common Stock
are Transferred.


 


(c) 
If a Tag-Along Transferor proposes to Transfer any Securities in a transaction
subject to this Section 2.4, it shall notify the Whitney Notice Parties in
writing of such proposed Transfer (a “Tag-Along
Offer Notice”).  Such Tag-Along Offer Notice shall set
forth: (i) the name of the Tag-Along Transferee, (ii) the number and
nature of the Securities proposed to be Transferred, (iii) the proposed
amount and form of consideration and all other material terms and conditions of
such offer, including the date of the proposed Transfer and all applicable
representations, indemnities and other contract provisions required by the
Tag-Along Transferee (the “Tag-Along
Transferee Terms”), (iv) the total number and nature of
Securities owned by the Tag-Along Transferor and Hartnett and his Permitted
Transferees and (v) that the Tag-Along Transferee has been informed of the
Tag-Along Right provided for in this Section 2.4 and has agreed to
purchase Securities subject hereto in the manner set forth in Subsections 2.4(a) and
(b).  The Tag-Along Right may be exercised by any Tag-Along Party by
delivery of a written notice to the Tag-Along Transferor (the “Tag-Along Notice”) within ten (10) days
following delivery of the Tag-Along Offer Notice (the “Tag-Along Notice Deadline”) setting
forth the number of Securities the Tag-Along Party wishes to sell to the
Tag-Along Transferee.  The failure by any Tag-Along Party to provide the
Tag-Along Notice on or before the Tag-Along Notice Deadline shall be deemed to
be an election by such Tag-Along Party not to exercise the Tag-Along Right with
respect to the transaction described in the Tag-Along Offer Notice.


 


(d) 
Upon delivery of a Tag-Along Notice, each participating Tag-Along Party shall
be obligated to sell to the Tag-Along Transferee the number of Securities set
forth in its Tag-Along Notice (but not to exceed the number determined in
accordance with subparagraph (a) of this Section 2.4) subject to the
Tag-Along Transfer Terms (including the same


 


11





















 


representations,
indemnities and the like made by the Tag-Along Transferor). 
Notwithstanding the foregoing, no participating Tag-Along Party shall be
required to provide indemnification to the Tag-Along Transferee (i) other
than on a several (and not joint and several) basis and (ii) in excess of
the proceeds actually received by such participating Tag-Along Party.  The
Tag-Along Transferor and each of the Tag-Along Parties shall bear their own
costs and expenses related to the Tag-Along Transfer.


 


(e) 
The Tag-Along Parties electing to participate in the sale of Securities to the
Tag-Along Transferee (and each of them) shall execute and deliver to Holdings
within fifteen (15) business days after delivery to such Tag-Along Parties for
such execution, all documents required to be executed by each such Tag-Along
Party in order to consummate the sale, subject to the limitations on liability
contained in Section 2.4(d) above.


 


(f) 
In the event that the Tag-Along Transfer Terms are at any time changed in any
material respect (including any decrease in the applicable purchase price)
prior to the consummation of the Tag-Along Transfer, the Tag-Along Transferor
shall notify each of the Tag-Along Parties, and each of the Tag-Along Parties
shall have the right, exercisable at any time within five (5) days
following delivery thereof, to withdraw its participation in the
Tag-Along-Transfer by so notifying the Tag-Along Transferor and Holdings.


 


(g) 
To the extent that the Tag-Along Parties (or any of them) elect not to participate
in the Transfer described in the Tag-Along Offer Notice, the Tag-Along
Transferor shall have the right at any time within ninety (90) days following
the Tag-Along Notice Deadline to Transfer all or substantially all of the
Securities proposed to be Transferred, as set forth in the Tag-Along Transfer
Notice (and that are not being sold by participating Tag-Along Parties) to the
Tag-Along Transferee; provided that the terms of the Transfer, taken as a
whole, are substantially similar to those set forth in the Tag-Along Notice.


 


(h) 
At the closing of the Transfer of Securities to a Tag-Along Transferee (of
which the Tag-Along Transferor shall give each participating Tag-Along Party at
least five (5) days’ prior written notice), the Tag-Along Transferee shall
remit to Holdings the consideration for the total sales price of Securities of
such Parties sold pursuant hereto, against delivery by such Parties of such
evidence of ownership of such Parties’ Securities as may be requested by the
Tag-Along Transferee, and the compliance by such Parties with any other
conditions to closing generally applicable to the Tag-Along Transferor and all
participating Tag-Along Parties.  Holdings shall, as soon as practicable
but in no event later than the business day next following the closing, remit
to the Tag-Along Transferor and each participating Tag-Along Party its portion
of such consideration.


 


(i) 
If any proposed Transfer contemplated by Sections 2.4(e) and (g) above
is terminated or is otherwise not consummated for any reason (in the case of
Transfers contemplated by Section 2.4(g) within the ninety (90) day
period in which such Transfer may be made), the Tag-Along Transferor shall,
without prejudice to its rights hereunder to deliver a subsequent Tag-Along
Notice, provide written notice of such termination to the other Parties and
shall promptly return to all Tag-Along Parties who elected to participate in
such Transfer all documentation which such Tag-Along Parties had previously
delivered to Holdings in connection with such Transfer.


 


12





















 


(j) 
Notwithstanding anything contained herein to the contrary, this Section 2.4
shall not apply to: (i) Transfers to Permitted Transferees, (ii) Call
Option Transfers and (iii) Transfers with respect to which the Hartnett
Transferors have exercised a right to compel sale pursuant to Section 2.5.


 


2.5  Right to Compel Sale.


 


(a) 
Subject to subsection (h) below, and so long as the Minimum Hartnett
Ownership equals or exceeds ninety percent (90%) or the Minimum Whitney
Ownership equals or exceeds twenty-five percent (25%), as the case may be, if
either (i) Hartnett and/or his Permitted Transferees or (ii) Whitney
and/or its Permitted Transferees (a “Compelled
Sale Transferor”) wish to cause a Sale of Business Transaction
with any Person other than to a Permitted Transferee of such Persons (“Compelled Sale Purchaser”), then each
of the other Parties (the “Other Parties”)
shall be obligated, upon the written request of the Compelled Sale Transferor,
to join and fully cooperate in such Sale of Business Transaction (a “Compelled Sale”), all as more fully
set forth in this Section 2.5.  The Compelled Sale Transferor shall
evidence its intent to initiate a Compelled Sale by delivering notice of such
effect to the Other Parties (an “Initiating
Notice”).


 


(b) 
From and after the delivery of an Initiating Notice, the party delivering such
Initiating Notice under this Section 2.5 may retain, or cause Holdings to
retain, the services of a nationally recognized investment bank (the “Investment Bank”) to conduct such
Compelled Sale and a nationally recognized law firm to advise on such sale, in
each case at the expense of the Company.  Such Investment Bank will
establish procedures reasonably acceptable to the Compelled Sale Transferor and
Holdings to effect an orderly sale of Holdings with the objective of achieving
the highest practicable value for the stockholders of Holdings within a
reasonable period of time.  Each Party and Holdings will cooperate with
the Investment Bank in accordance with such procedures, and agrees to use its
reasonable best efforts to reach agreement on the optimum structure and the
terms and conditions for the Compelled Sale (including whether such sale will
be by merger or sale of assets or capital stock or otherwise).


 


(c) 
The Compelled Sale Transferor shall notify the Other Parties in writing of a
Compelled Sale (a “Compelled Sale Notice”),
as soon as practicable after the definitive terms of such transaction are
known.  Such Compelled Sale Notice shall set forth all of the material
terms and conditions of the Compelled Sale, including, without limitation, the
proposed amount and nature of consideration and all other material terms and
conditions, including the proposed closing date of the Compelled Sale and all
applicable representations, indemnities and other contract provisions. 
The Other Parties (and each of them) shall execute and deliver to Holdings
within (10) business days after delivery to such Other Parties for such execution,
all documents, other than the Compelled Sale Shares, required to be executed by
each such Other Party in order to consummate such Compelled Sale, all subject
to the following:


 


(i)                                     Unless otherwise agreed
upon by the Other Parties, if the Sale of Business Transaction is structured as
a sale of capital stock, the terms and conditions applicable to the sale of the
capital stock of Holdings owned by the Other Parties shall be substantially the
same to those applicable to the sale of the capital stock by the Compelled Sale
Transferor,


 


13





















 


including,
without limitation, the amount and nature of consideration and subject to the
same representations, indemnities and the like required of the Compelled Sale Transferor.


 


(ii)                                  Upon a Sale of Business
Transaction, each party that owns Preferred Stock will receive consideration in
an amount per share of Preferred Stock equal to the Liquidation Amount of such
share as set forth in Holdings Certificate of Incorporation.  For the
avoidance of doubt, if the total consideration payable in respect of any such
Sale of Business Transaction is not sufficient to pay the aggregate Liquidation
Amount of each share of Preferred Stock then outstanding to the holders thereof,
then such holders will share all of such consideration in accordance with Section B(3) of
Article Fourth of the Holdings Certificate of Incorporation and the
holders of Common Stock will not be entitled to receive any consideration in
respect of such Sale of the Business.


 


(iii)                               Notwithstanding the
foregoing, no Other Party shall be required to provide for indemnification to
the Compelled Sale Purchaser (A) other than on a several (and not joint
and several) basis and (B) in excess of the proceeds actually received by
such Other Party.  The Compelled Sale Transferor and each of the Other
Parties shall bear their own costs and expenses related to the Compelled Sale.


 


(iv)                              Unless the Compelled Sale
Purchaser shall agree to the contrary, prior to any Transfer to the Compelled
Sale Purchaser, the Other Parties shall exercise, convert or exchange such
number of their Derivative Securities as may be necessary so that only shares
of Common Stock are Transferred.


 


(d) 
The Other Parties shall (i) vote for, consent to and raise no objections
against any Compelled Sale pursuant to this Section 2.5, and (ii) enter
into such definitive agreements as are consistent with subsection (c) above. 
If the Compelled Sale is structured as a sale of issued capital stock, (A) each
Other Party shall agree to sell all of such Other Party’s capital stock of
Holdings on the terms and conditions of the Compelled Sale and (B) at the
closing of such Compelled Sale each Other Party will transfer to the Compelled
Sale Purchaser all shares of capital stock owned by it, with full title
guarantee free and clear of all liens and encumbrances, together with duly
executed written instruments of transfer with respect thereto, in form and
substance reasonably satisfactory to the Compelled Transferor.  If the
Compelled Sale is structured as a sale of assets, the Other Parties agree to
cause Holdings to execute and deliver or cause to be executed and delivered all
documents, certificates, agreements and other writings and to take, or cause to
be taken, all such actions as may be necessary or desirable to vest in the
Compelled Sale Purchaser good and marketable title to such assets.  If the
sale of Holdings is structured as a merger or consolidation, each Other Party
shall waive any dissenters’ rights, appraisal rights or similar rights in
conjunction with such merger or consolidation.


 


(e) 
The Compelled Sale Transferor shall have the right at any time within one
hundred twenty (120) days following the execution of all required documents
pursuant to Subsection (d) above to consummate the Compelled Sale on
the terms set forth in such documents.  The closing of the Compelled Sale
shall take place not less than five (5) business days’ prior notice,
setting forth the date and location of such closing.


 


14





















 


(f) 
At the closing of the Compelled Sale, if the Compelled Sale is structured as a
sale of issued capital stock or as a merger or consolidation, the Compelled
Sale Purchaser shall cause all amounts payable to the Other Parties to be
delivered directly to them (including, as to the cash portion of the
consideration, to accounts designated by each of the Other Parties).


 


(g) 
If any Compelled Sale Offer is withdrawn or terminated for any reason prior to
consummation (including by the failure of the Compelled Sale Transferor to
consummate the Compelled Sale within the one hundred twenty (120) day period
set forth in Section 2.5(e)), Holdings shall, without prejudice to any of
the Compelled Sale Transferor’s rights hereunder to deliver a subsequent
Compelled Sale Notice, return to each of the Other Parties all documentation
which he had previously received from such Other Parties in connection with
such Compelled Sale Offer.


 


(h) 
Notwithstanding anything contained herein to the contrary, (i) Hartnett
and his Permitted Transferees shall have no rights under this Section 2.5
in respect of Whitney Securities and the holders of Whitney Securities shall
have no obligations under this Section 2.5, with respect to any proposed Compelled
Sale by Hartnett and/or his Permitted Transferees that is to be consummated on
or before thirty (30) months following the date hereof, unless the Whitney IRR
measured as of, and after giving effect to, the closing of the Compelled Sale
is equal to or greater than 25%; provided, however, that the
limitation set forth in this subparagraph (i) shall not apply from and
after such time that Whitney transfers any Whitney Securities to a Person other
than a Permitted Transferee, (ii) (A) Whitney and its Permitted
Transferees shall have no rights under this Section 2.5 in respect of
Hartnett Securities and the holders of Hartnett Securities shall have no
obligations under this Section 2.5, as to any Compelled Sale that is
initiated by Whitney and its Permitted Transferees pursuant to an Initiating
Notice that is delivered before January 1, 2007, and (B) Whitney and
its Permitted Transferees shall have no rights under this Section 2.5 in
respect of Hartnett Securities and the holders of Hartnett Securities shall
have no obligations under this Section 2.5, unless Whitney and/or its
Permitted Transferees shall have (x) first provided Hartnett with notice
(a “Negotiation Notice”)
of its intent to cause a Compelled Sale and (y) for a period of thirty (30)
days following delivery of the Negotiation Notice, negotiated exclusively with
Hartnett regarding the purchase of the Whitney Securities by Hartnett or his
designee (for a purchase price reflective of the value of such securities in
connection with a Compelled Sale), and (iii) neither Hartnett and his
Permitted Transferees or Whitney and its Permitted Transferees shall have any
rights to initiate a Compelled Sale process hereunder for a period of one
hundred twenty (120) days following such time that the other shall have
delivered an Initiating Notice; provided, that (x) such period shall be
extended for so long as may be reasonably requested by the Investment Bank
retained at the request of the Compelled Sale Transferor in order to pursue the
Sale of Business Transaction, and (y) in order to give effect to the rights of
Whitney and its Permitted Transferees to initiate a Compelled Sale process on January 1,
2007, Hartnett and his Permitted Transferees may not initiate a Compelled Sale
process between September 1, 2006 and December 31, 2006.


 


2.6  Securities of
Transferees.


 


(a) 
Securities are transferable only (i) in a Public Sale or (ii) subject
to the provisions of Section 2.6(b) below, by any other legally
available means of Transfer; provided,


 


15





















 


that
any Transfer must also comply with, or otherwise be permitted by, the terms of
this Article 2 and the other provisions of this Agreement.


 


(b) 
In connection with the Transfer of any Securities other than a Transfer
described in clause (i) of Section 2.6(a) above, any Call Option
Transfer or any Transfer between a Party and any of its Permitted Transferees,
the holder thereof shall deliver written notice to Holdings describing in
reasonable detail the Transfer or proposed Transfer, together with, if
reasonably requested by Holdings, an opinion of counsel reasonably acceptable
to Holdings to the effect that such Transfer of Shares may be effected without
registration of such Securities under the Act.  In addition, if the holder
of the Securities delivers to Holdings an opinion of counsel that no subsequent
Transfer of such Securities shall require registration under the Act, Holdings
shall upon such contemplated Transfer deliver new certificates for such
Securities which do not bear the relevant legend set forth in Section 2.1
above.  If Holdings is not required to deliver new certificates for such
Securities not bearing such legend, the holder thereof shall not Transfer the
same until the prospective transferee has confirmed to Holdings in writing its
agreement to be bound by the conditions contained herein, as provided in Section 2.6(d).


 


(c) 
Upon the request of a holder of Securities, Holdings shall supply to such
Person or its prospective transferees all the information within its possession
regarding Holdings, required to be delivered in connection with a Transfer
pursuant to Rule 144A of the Commission (or any similar rule or rules then
in effect).


 


(d) 
Notwithstanding anything contained in this Article 2 to the contrary, all
Transfers (other than Call Option Transfers) by the Parties shall be
conditioned upon the relevant Transferee (including any Permitted Transferee)
first entering into and delivering to the other Parties a joinder agreement (a “Joinder Agreement”), in the form
attached hereto as Exhibit B, pursuant to which such Transferee, and the
Securities acquired, shall become subject to the terms and conditions of this
Agreement, including (f) below.  In case of a Transfer of
Indemnification Shares, the Transfer by the Parties shall also be conditioned
upon the relevant Transferee (including any Permitted Transferee) first
entering into and delivering to the Other Parties a Joinder Agreement in the
form attached hereto as Exhibit C, pursuant to which such Transferee, and
the Securities acquired, shall become subject to the terms and conditions of
the Old Stock Purchase Agreement, the New Stock Purchase Agreement or the Third
Stock Purchase Agreement, as applicable.


 


(e) 
Upon any Transfer and the execution of a Joinder Agreement, each Transferee,
and the Securities acquired by it, shall be subject to all of the limitations
and obligations set forth herein and shall obtain the benefits and rights of a
Party hereunder with respect to the Securities so acquired; provided that the
Securities purchased by any Tag-Along Transferee in accordance with the
procedures set forth in Section 2.4 shall not be subject to tag-along
obligations under Section 2.4 upon any further Transfers otherwise subject
thereto.


 


(f) 
In the event that the Whitney Parties transfer any of their Securities
hereunder to a Permitted Transferee, thereafter: (i) any notices to be
given to such Permitted Transferees shall be deemed given if delivered to
Whitney II, (ii) a notice from any such Permitted Transferee shall be
deemed delivered only if delivered by Whitney II, and (iii) all of the
Parties


 


16





















 


hereto
shall be permitted to rely upon any notice given by Whitney II as containing
the intentions of the Whitney Parties’ Permitted Transferees.


 


(g) 
In the event that any Initial Party (other than Whitney) Transfers any of its
Securities hereunder, thereafter: (i) any notices to be given to such
Transferees shall be deemed given if delivered to their Initial Party
Transferor, (ii) a notice from any such Transferee shall be deemed
delivered only if delivered by its Initial Party Transferor, and (iii) all
of the Parties hereto shall be permitted to rely upon any notice given by an
Initial Party (other than Whitney) as containing the intentions of its
Transferees.  If an Initial Party (other than Whitney) wishes, it may
designate, by written notice to Holdings and all other Parties, a successor
Person to give and accept notices on behalf of all Transferees of such Person,
as set forth herein.


 


2.7  Competitors.


 


(a) 
Notwithstanding anything contained in this Article 2 to the contrary,
neither Whitney nor any holder of Whitney Securities may Transfer any
Securities to any Person who competes, directly or indirectly through one of
its Affiliates, with Holdings or its subsidiaries in any business which
Holdings or any such subsidiary is engaged or at the time of such Transfer
intends to engage (a “Competitor”).


 


(b) 
Whitney (to the extent it is the record holder of Whitney Securities) shall
not, and shall cause its Affiliates not to, acquire any debt or equity
securities in any Competitor (excepting less than 5% stock holdings for
investment purposes in securities of publicly held and traded companies that Whitney
or such holder of the Whitney Securities does not have the power to appoint a
director) without providing Hartnett and Holdings with written notice
thereof.  Holdings’ recourse against Whitney and, as applicable, Whitney
V, in case of breach of this subsection (b) shall be limited to
demanding notification of such acquisition by Whitney, the holders of the
Whitney Securities or their Affiliates in a Competitor.


 


2.8  Transfers Not in
Compliance Void.


 


Any purported Transfer of Securities owned by a Party
that is not in compliance with this Agreement shall be null and void and of no
force and effect whatsoever.  Accordingly, such Transfer shall not be
reflected on the books of Holdings and Holdings will not recognize any such
proposed transferee as the holder of any such Securities.


 


2.9  Termination.


 


The restrictions on Transfer of Securities and the
other rights, restrictions and obligations contained in Sections 2.3, 2.4, 2.5
and 2.7 shall terminate and be of no further force and effect following an Initial
Public Offering.


 


3.  RIGHT OF FIRST
OFFER; PARTICIPATION RIGHT


 


3.1  Right of First Offer
and Participation Right as to New Securities.


 


Holdings shall not issue any shares of Common Stock
or Derivative Securities (“New Securities”)
except as set forth in Section 3.1.


 


17





















 


(a) 
So long as the Minimum Whitney Common Ownership is at least twenty percent
(20%), if Holdings desires to issue New Securities, it shall give first notice
thereof to the Whitney Notice Parties (a “New
Issue Notice”).


 


(i)                                     Any such New Issue Notice
shall contain a description of the material terms and conditions on which
Holdings will offer the New Securities including (A) the number and type
of New Securities to be issued, (B) the proposed process applicable to the
issuance, (C) the desired purchase price to be obtained in, and all other
terms applicable to, such issue and (D) the intended timing of such
issuance (together, the “New Issue Terms”). 
The New Issue Notice shall constitute an offer by Holdings to sell the
Securities that are the subject of the New Issue Notice to the holders of the
Whitney Securities on the New Issue Terms.


 


(ii)                                  The Required Holders shall
have the right (the “Right of First Offer”),
exercisable at any time within thirty (30) days after delivery of the New Issue
Notice, to either (A) accept the offer made thereby by furnishing written
notice thereof to Holdings and agreeing to purchase all and not less than all
of the Securities so offered in, and at the New Issue Terms specified in, the
New Issue Notice or (B) make a counter-offer to Holdings to acquire such
New Securities on different terms (the “Whitney
Counter-Offer”).  Any such Whitney Counter-Offer shall
contain a description of the material terms and conditions on which the
Required Holders offer to buy all and not less than all of the New Securities
from Holdings (the “Counter-Offer Terms”). 
The Whitney Counter-Offer shall constitute an offer by the holders of the
Whitney Securities to purchase the Securities that are the subject of the New
Issue Notice at the Counter-Offer Terms. Holdings shall have the right,
exercisable at any time within thirty (30) days after delivery of the Whitney
Counter-Offer, to accept the Whitney Counter-Offer made thereby by furnishing
written notice thereof to the Required Holders (the “Holdings Response”) and agreeing to
sell all and not less than all of the Securities so offered in the New Issue
Notice and at the Counter-Offer Terms specified in the Whitney Counter-Offer. 
Any Party who fails to deliver a notice called for by the subsection to
exercise a right within the time periods provided for herein shall be deemed
not be have exercised such right.


 


(iii)                               Upon the acceptance of any
such offer or Counter-Offer pursuant to (ii) above, Holdings shall
designate a date on which it shall issue the Securities to be sold, which date
shall be not less than five (5) days nor more than thirty (30) days
following the date on which it accepts such offer or Counter-Offer.  At
such closing, the Required Holders shall deliver payment in the appropriate
amount to Holdings against (A) delivery of certificates or other
instruments representing the Securities so purchased and (B) completion of
all documentation necessary to satisfy all of the terms of the purchase of the
New Securities.  The closing for the purchase of Securities pursuant
hereto shall occur within thirty (30) days after acceptance by, as the case may
be, Holdings or the Required Holders, unless otherwise agreed to as between
Holdings and the Required Holders.


 


(iv)                              If the Required Holders do
not elect to purchase all of the Securities that were the subject of the New
Issue Notice, Holdings shall have the unlimited right at its option, at any
time within the one hundred and eighty (180) day period following the end of
the notice period set forth in (ii) above (but subject to the terms of Section 3.1(b))
to sell all of the Securities that were the subject of the New Issue Notice (A) if
no Whitney Counter-Offer is made, on such terms as it deems appropriate, or (B) if
a Whitney Counter-Offer is made, for a


 


18





















 


per
share price no less than was set forth in the Whitney Counter-Offer; Any
subsequent or other proposed Transfer shall be subject to the right of first
offer set forth in this Section 3.1(a).


 


(b) 
If the Required Holders do not purchase the New Securities that are the subject
of the New Issue Notice by operation of the provisions of Section 3.1(a) and
Holdings proceeds to issue such New Securities (a “Preemptive Issuance”), Whitney,
Hartnett and their respective Permitted Transferees (the “Preemptive Parties”) shall each have
the right (the “Participation Right”)
to purchase New Securities of the same class and series issued in such
Preemptive Issuance at the price per New Security paid in connection therewith
and otherwise upon the same terms and conditions as the New Securities being
issued in the Preemptive Issuance.


 


(i)                                     In the case of a
Preemptive Issuance, Holdings shall provide each Preemptive Party with written
notice identifying the New Securities, the Persons to whom the New Securities
are being issued and describing the terms and amount of the Preemptive
Issuance.  A Preemptive Party may exercise its Participation Right by
written notice to Holdings within ten (10) days following delivery of the
notice described in the preceding sentence.  The failure by any Preemptive
Party to provide such notice before the expiration of the ten (10) day
period shall be deemed to be an election by such Preemptive Party not to
exercise its Participation Right with respect to the Issuance.  Each
Preemptive Party electing to exercise its Participation Right under this Section 3.1(b)(i) shall
execute such documents as may be reasonably requested by Holdings to evidence
the purchase of such New Securities; provided that the terms and
conditions applicable to the sale of such New Securities shall be the same as
required of the purchaser of such New Securities (including, without limitation,
the amount and nature of consideration and representations, indemnities and the
like).  The closing of the issuance of such New Securities issued to
Preemptive Parties under this Section 3.1(b) (including the payment
therefor by the Preemptive Parties) shall occur at the same time as the closing
of the issuance of such New Securities to the third-party purchasers thereof.


 


(ii)                                  The number of New
Securities each Preemptive Party may purchase under this Article 3 with
respect to each Preemptive Issuance shall be such number so that after exercise
of the Participation Right such Preemptive Party’s Outstanding Common Shares
will represent the same percentage of the total Outstanding Common Shares
following the Preemptive Issuance as such Preemptive Party’s Outstanding Common
Shares represented of the total Outstanding Common Shares prior thereto. 
Notwithstanding the foregoing, (i) the Required Holders may assign their
Participation Right to other holders of Whitney Securities and (ii) Hartnett
and his Permitted Transferees (the “Hartnett
Preemptive Parties”) shall have the right to assign their
Participation Right to other Hartnett Preemptive Parties.


 


3.2  Exceptions to Right of
First Offer and Participation Right.


 


(a) 
The Right of First Offer and Participation Right provided for in this Article 3
shall not apply to any New Securities being issued in connection with, and the
term “Preemptive Issuance” shall not include an issuance in respect of, (i) the
exercise, conversion or exchange of Derivative Securities outstanding on the
date hereof, (ii) a restructuring, including a cancellation or
modification of the terms of any, of the debt of Holdings or any of its
subsidiaries in which lenders or owners of debt securities of Holdings or its
subsidiaries receive equity interests in


 


19





















 


consideration
of or in connection with such restructuring or otherwise, (iii) any
management equity plans heretofore or hereafter approved by the Board to
purchase Common Stock (provided, that such Common Stock together with
all shares of Common Stock issued or issuable pursuant to this clause (iii) as
to grants made after the date hereof do not exceed 396,241.50 shares (subject
to adjustment to reflect any stock split, stock divided, reclassification,
recapitalization or other transaction having a similar effect), (iv) other
preemptive rights or anti-dilution provisions in favor of any other stockholder
or warrant holder of Holdings, (v) the issuance of New Securities (or the
subsequent exercise, conversion or exchange any Derivative Securities) as a
component of the issuance of debt by Holdings or its subsidiaries where such
New Securities (assuming the immediate exchange, conversion or exchange of
Derivative Securities) would represent less than ten percent (10%) of the
Outstanding Common Shares on such date, (vi) any issuance of New
Securities to a seller in connection with an acquisition of stock or assets of
another entity by Holdings or any of its subsidiaries, or (vii) an initial
public offering of Common Stock of Holdings.


 


(b) 
Notwithstanding any provision of this Article 3 to the contrary, if the
exercise by any holder of Whitney Securities of their Right of First Offer
would cause the Common Stock (on a fully-diluted basis, assuming conversion of
all Derivative Securities) which all of the holders of Whitney Securities own,
directly or indirectly, to exceed forty-nine and nine-tenths percent (49.9%) of
the Voting Power of the Common Stock (on a fully-diluted basis, assuming conversion
of all Derivative Securities), then such holders of Whitney Securities agrees
that that portion of the New Securities so exceeding such forty-nine and
nine-tenths percent (49.9%) threshold shall be replaced with a different class
of Securities without any voting rights whatsoever (but in all other respects
identical to the New Securities); provided that this Subsection 3.2(b) shall
not apply to issuances of New Securities which themselves constitute issuances
of more than fifty percent (50%) of the Voting Power of the Common Stock (on a
fully-diluted basis, assuming conversion of all Derivative Securities, after
giving effect to such issuance).  Each of the Parties covenants and agrees
that it shall take all measures required to carry out the foregoing, including
approval of any required amendment to the Certificate of Incorporation of
Holdings.


 


3.3  Right of First Offer on
Subordinated Debt Issuances.


 


So long as the Minimum Whitney Ownership is at least
25%, prior to the issuance by Holdings or any of its subsidiaries of Applicable
Subordinated Debt, Holdings shall provide notice to Whitney of such intended
issuance (a “Debt Notice”
which Debt Notice shall include, to the extent known, the amount and terms of
such Applicable Subordinated Debt), and neither Holdings nor any such
subsidiary shall issue such Applicable Subordinated Debt without providing
Whitney with the right for a period of thirty (30) days following delivery of
the Debt Notice to make an offer to purchase such Applicable Subordinated
Debt.  It is specifically agreed that neither Holdings nor any such
subsidiary shall be obligated to accept such offer; and following such thirty
(30) day period Holdings or such subsidiary may issue such Applicable
Subordinated Debt to such party or parties and on such terms (irrespective of
the terms offered by Whitney), as it deems appropriate without regard to any
rights under this Section 3.3.


 


20





















 


3.4  Termination on Initial
Public Offering.


 


The Rights of First Offer and the Participation
Right provided for in this Article 3 shall terminate and be of no further
force and effect following an Initial Public Offering.


 


4.  REGISTRATION RIGHTS.


 


4.1  Piggyback Registration.


 


If, at any time Holdings proposes to file a
registration statement or statements under the Act (together with any
registration statement filed pursuant to a demand made under Section 4.2, “Registration Statement”) for the
public sale of Common Stock for cash (other than in connection with a merger or
pursuant to Form S-4, Form S-8 or comparable registration statement);
it will give written notice by registered mail, at least thirty (30) days prior
to the filing of each such registration statement, to each Party of its
intention to do so.  If any Party (all such Parties collectively with any
Parties who have made a demand pursuant to Section 4.2 if the context so
requires, the “Registering Parties”)
notifies Holdings within ten (10) business days after delivery of any such
notice of its desire to include any such Common Stock (including Common Stock
underlying Derivative Securities) (all such shares, “Piggyback Shares”) in such proposed
Registration Statement, Holdings shall afford such Registering Party the
opportunity to have any Piggyback Shares owned by such Party registered under
such Registration Statement; provided, however, that in the case of an
underwritten offering, if the managing underwriter notifies any Registering
Party that the inclusion in the registration statement of any portion of its
Piggyback Shares would have an adverse effect on such underwritten offering,
then the managing underwriter may limit the number of Piggyback Shares to be
included in such registration statement only to the extent necessary to avoid
such adverse effect (an “Underwriter’s
Cutback”).  Such limit will apply pro rata among the
Registering Parties based upon the number of Piggyback Shares such Parties have
requested to be so included (provided that if the Registration Statement is
being filed pursuant to Section 4.2 below, then, as among the holders of
Demand Securities (as defined below) and the Securities held by other Parties,
any Underwriter’s Cutback shall first be applied to such other Parties’
Securities); and in the event securities of Holdings held by any person or
entity other than Holdings or the Parties (“Third
Party Securities”) are to be included in such underwritten
offering, and the managing underwriter shall have determined to effectuate an
Underwriter’s Cutback, then such limitation shall first be applied to the Third
Party Securities, and then to the Piggyback Shares.


 


Notwithstanding the provisions of this Section 4.1,
except in the case of a Demand Registration Statement, Holdings shall have the
right at any time after it shall have given written notice pursuant to this Section 4.1
(irrespective of whether a written request for inclusion of any such securities
shall have been made) to elect not to file any such proposed registration
statements or to withdraw the same after the filing but prior to the effective
date thereof.


 


4.2  Demand Registration.


 


(a)                                  (i)                                     Commencing on the
earlier of (A) six (6) months following the effective date of an
Initial Public Offering and (B) the third anniversary of the date hereof,
and expiring five (5) years thereafter and provided that such Securities
shall not at that time be eligible for


 


21





















 


sale
pursuant to Rule 144(k) under the Act, the holders of Whitney Securities
shall have the collective right, on two (2) occasions (which right is in
addition to the registration rights under Section 4.1 hereof), exercisable
by written notice to Holdings (the “Demand
Notice”) given by the holders of a majority (the “Demanding Holders”) of the Whitney
Securities then outstanding that have not been sold pursuant to a Registration
Statement or pursuant to Rule 144(k) of the Commission without regard to
limiting or qualifying of Securities to be sold and have had all transfer
restrictions contained thereon removed (the “Demand Securities”), to have Holdings prepare and file
with the Securities and Exchange Commission (the “Commission”) a registration statement (“Demand Registration Statement”) and
such other documents, including a prospectus, as may be necessary in the opinion
of counsel for Holdings, and shall keep such registration statement effective
and the disclosure in such documents current, in order to comply with the
provisions of the Act, so as to permit a public offering and sale of the Demand
Securities by the holders thereof for nine (9) consecutive months.


 


(ii)                                  A registration requested
pursuant to this Section 4.2 shall not be deemed to have been effected
(and thereby the right to make a demand not used) (A) unless a
Registration Statement with respect thereto has become effective, provided that
a registration which does not become effective after Holdings has filed a
Registration Statement with respect thereto solely by reason of the refusal to
proceed of the holders (other than a refusal to proceed based upon the advice
of counsel relating to a matter with respect to Holdings) shall be deemed to
have been effected by Holdings at the request of such holders unless the
holders of Demand Securities shall have elected to pay all expenses referred to
in Section 4.3(b) in connection with such registration, (B) if,
after it has become effective, such registration becomes subject to any stop
order, injunction or other order or requirement of the Commission or other
governmental agency or court for any reason and such order, injunction or
requirement is not promptly withdrawn or lifted, (C) the conditions to
closing specified in the purchase agreement or underwriting agreement entered
into in connection with such registration are not satisfied, other than by
reason of some act or omission by such holders, or (D) if less than
eighty-five percent (85%) of the Demand Securities were sold pursuant to such
registration.


 


(b) 
The holders of Whitney Securities shall have the right, exercisable at any time
and from time to time by written notice to Holdings of the holders of
twenty-five percent (25%) of the Whitney Securities, to have Holdings prepare
and file with the Commission, if available, a registration on Form S-2, Form S-3,
or any similar form if not available, for the sale of Securities held by such
Parties.


 


(c) 
A registration requested pursuant to this Section 4.2 may, if determined
by Holdings to have the potential to have a material adverse effect on, or
otherwise interfere with, any transaction or other business matter with which
Holdings is then involved or contemplates, at Holding’s option be deferred for
no more than one hundred and eighty (180) days from the date of delivery of the
Demand Notice.


 


(d) 
Holdings shall have the right, at its option, following receipt of the Demand
Notice requiring the filing of a Registration Statement that would result in
the first public offering of equity securities of Holdings under the Act, in
lieu of filing a Registration Statement referred to in such demand, to
undertake the filing of a Registration Statement under the Act with the
Commission for the sale by Holdings of securities of Holdings, in which case
the Parties


 


22





















 


shall
be permitted to exercise their rights under Section 4.1 above. 
Should Holdings exercise its rights under this Section 4.2(d), the rights
of the Demanding Holders to make a demand under Section 4.2(a) above
on two (2) occasions shall not be deemed to have been exercised, and such
parties shall retain such right subject to the limitations contained herein.


 


(e) 
In Holdings’ discretion, it may include a sale of shares or shares owned by
others or an issuance of shares by Holdings in a registration pursuant to this Section 4.2. 
In the event of an Underwriter’s Cutback in connection with a registration
pursuant to this Section 4.2, such Underwriter’s Cutback shall first be
applied in respect of such shares owned by others, then in respect of the
shares to be included by Holdings, pursuant to this Section 4.2(e) and
lastly in respect of the Demand Securities.


 


4.3  Covenants With Respect
to Registration.


 


In connection with any registration under Section 4.1
or 4.2 hereof, as applicable, Holdings covenants and agrees as follows:


 


(a) 
Holdings shall prepare and use commercially reasonable efforts to, not later
than sixty (60) days after (or if the sixtieth (60th) day is not a
business day, the first business day thereafter) of delivery of any demand
therefor, to cause such Demand Registration Statement to become effective under
the Act within one hundred fifty days (150) days (or if the one hundred
fiftieth (150th) day is not a business day, the first business day
thereafter) after demand therefor and shall keep the Demand Registration
Statement effective for not less than nine months after the date on which
notice of the effectiveness thereof is received (such period being called the “Demand Registration Period”), and
shall furnish holders of Demand Securities such number of prospectuses as shall
reasonably be requested.


 


(b) 
Holdings shall pay all costs (including fees and expenses of one counsel to the
Registering Parties, selected in accordance with Section 4.5 below, if
applicable, but excluding any underwriting or selling commissions or discounts
or other charges of any broker-dealer acting on behalf of any holder of Demand
Securities), fees and expenses in connection with all registration statements
filed pursuant to Sections 4.1 and 4.2 hereof and offers and sales pursuant
thereto including, without limitation, Holdings’ legal and accounting fees,
printing expenses, blue sky fees and expenses, registration fees, filing fees
and listing fees.


 


(c) 
In connection with any registration contemplated by Section 4.1 or 4.2
hereof, the following provisions shall apply:


 


(i)                                     Holdings shall (A) furnish
to the Registering Parties, prior to the filing of a Registration Statement
with the Commission, a copy of the Registration Statement and each amendment
thereto (including any incorporated documents) and each supplement, if any, to
the prospectus included therein and any document that is filed after the filing
of the Registration Statement and that is incorporated or would be deemed
incorporated by reference therein, and (B) include the names of the
Registering Parties who propose to sell securities pursuant to the Registration
Statement as selling security holders.


 


(ii)                                  Holdings shall promptly
give written notice to each Registering Party:


 


23





















 


(A) when the Registration Statement or any
amendment thereto has been filed with the Commission and when the Registration
Statement or any post-effective amendment thereto has become effective;


 


(B) of
any request by the Commission or other governmental authority for amendments or
supplements to the Registration Statement or the prospectus included therein or
for additional information;


 


(C) of
the issuance by the Commission of any stop order suspending the effectiveness
of the Registration Statement or the initiation of any proceedings for that
purpose;


 


(D)  of the receipt by Holdings or its legal counsel of
any notification with respect to the suspension of the qualification of the
Piggyback Shares or Demand Securities (as applicable, the “Registered Securities”) for sale in
any jurisdiction or the initiation or threatening of any proceeding for such
purpose; and


 


(E)  of the happening of any event that requires Holdings
to make changes in the Registration Statement or the prospectus in order that
the Registration Statement or the prospectus does not contain an untrue
statement of a material fact nor omit to state a material fact required to be
stated therein or necessary to make the statements therein not misleading or of
the commencement of any Suspension Period.


 


(iii)                               Holdings shall make every
reasonable effort to prevent the issuance of and obtain the withdrawal at the
earliest possible time of any order suspending the effectiveness of the
Registration Statement or of the qualification (or exemption therefrom) of any
of the Piggyback Shares or Demand Securities for sale in any jurisdiction.


 


(iv)                              Holdings shall furnish to
each Registering Party, without charge, at least one copy of the Registration
Statement and any post-effective amendment thereto, including financial
statements and schedules, and, if the Registering Party so requests in writing,
all exhibits thereto (including those, if any, incorporated by reference).


 


(v)                                 Holdings shall deliver to
each Registering Party, without charge, as many copies of the prospectus (including
each preliminary prospectus) included in the Registration Statement and any
amendment or supplement thereto as such person may reasonably request. 
Holdings consents, subject to the provisions of this Agreement, to the use of
the prospectus or any amendment or supplement thereto included in the
Registration Statement by each of the Registering Parties in connection with
the offering and sale of the Registered Securities covered by such prospectus
or any such amendment or supplement.


 


(vi)                              Prior to any public
offering of the Registered Securities, pursuant to any Registration Statement,
Holdings shall register or qualify or cooperate with the Registering Parties
and their respective counsel in connection with the registration or
qualification of the Registered Securities covered thereby for offer and sale
under the securities or “blue sky” laws of such states of the United States as
any Registering Party reasonably requests in writing and do any and all other
acts or things necessary or advisable to enable the offer and sale in such
jurisdictions of the Registered Securities covered by such Registration


 


24





















 


Statement;
provided, however, that Holdings shall not be required to (A) qualify
generally to do business in any jurisdiction where it is not then so qualified
or (B) take any action which would subject it to general service of
process or to taxation in any jurisdiction where it is not then so subject.


 


(vii)                           Holdings shall cooperate
with the Registering Parties to facilitate the timely preparation and delivery
of certificates representing the Registered Securities to be sold pursuant to
any Registration Statement free of any restrictive legends and in such
denominations and registered in such names as the Registering Parties may
request (including being eligible for deposit with The Depository Trust
Company) a reasonable period of time prior to sales of the Registered
Securities pursuant to such Registration Statement.


 


(viii)                        Upon the occurrence of any
event contemplated by paragraphs (B) through (E) of Section 4.3(c)(ii) above
during the period for which Holdings is required to maintain an effective
Registration Statement, Holdings shall promptly prepare and file a
post-effective amendment to the Registration Statement or a supplement to the
related prospectus and any other required document so that, as thereafter
delivered to the Registering Parties or purchasers of Registered Securities
covered by such Registration Statement, the prospectus will not contain an
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading.  If Holdings
notifies the Registering Parties in accordance with paragraphs (B) through
(E) of Section 4.3(c)(ii) above to suspend the use of the
prospectus until the requisite changes to the prospectus have been made, then
the Registering Parties shall suspend use of such prospectus, and the period of
effectiveness of the Registration Statement provided for in Section 4.2(a) above
shall each be extended by the number of days from and including the date of the
giving of such notice to and including the date when the Registering Parties shall
have received such amended or supplemented prospectus pursuant to this
paragraph.


 


(ix)                                Not later than the
effective date of the applicable Registration Statement, Holdings will obtain
one CUSIP number for all of the Registered Securities covered by such
Registration Statement.


 


(x)                                   Holdings may require each
Registering Party to furnish to Holdings such information regarding the
Registering Party and the distribution of the Registered Securities as Holdings
may from time to time reasonably require for inclusion in the Registration
Statement, and Holdings may exclude from such registration the Registered
Securities of any Registering Party that fails to furnish such information
within a reasonable time after receiving such request.


 


(xi)                                In the case of any Demand
Registration Statement, Holdings shall (A) make reasonably available for
inspection by the Registering Parties, any underwriter participating in any
disposition pursuant to the Demand Registration Statement and any attorney,
accountant or other agent retained by the Registering Parties or any such
underwriter all relevant financial and other records, pertinent corporate
documents and properties of Holdings and its subsidiaries and (B) cause
Holdings’ and its subsidiaries, officers, directors, employees, accountants and
auditors to supply all relevant information reasonably requested by the


 


25





















 


Registering
Parties or any such underwriter, attorney, accountant or agent in connection
with the Demand Registration Statement, in each case as shall be reasonably
necessary, in the judgment of the Registering Parties or any such underwriter,
attorney, accountant or agent referred to in this paragraph, to conduct a
reasonable investigation within the meaning of Section 11 of the Act;
provided, however, that the foregoing inspection and information gathering
shall be coordinated on behalf of the Registering Parties by one counsel
designated by and on behalf of all Registering Parties, selected in accordance
with Section 4.5 below, if applicable, and one counsel designated by and
on behalf of the underwriters.


 


(xii)                             In the case of any Demand
Registration Statement, Holdings, if requested by holders of a majority of the
Demand Securities, shall cause (A) its counsel to deliver an opinion and
updates thereof relating to the Demand Securities to be registered in customary
form addressed to holders of the Demand Securities and the managing
underwriters, if any, thereof and dated, in the case of the initial opinion, the
effective date of such Demand Registration Statement; (B) its officers to
execute and deliver all customary documents and certificates and updates
thereof reasonably requested by any underwriters of the applicable Demand
Securities and (including, without limitation, an underwriting agreement in
form and substance as is customary in underwritten public offerings), and (C) its
independent public accountants and the independent public accountants with
respect to any business acquired, to the extent financial information with
respect thereto is included or incorporated by reference in the Demand
Registration Statement to provide to the holders of the Demand Securities and
any underwriter therefor a comfort letter in customary form and covering
matters of the type customarily covered in comfort letters in connection with
primary underwritten offerings, subject to receipt of appropriate documentation
as contemplated, and only if permitted, by Statement of Auditing Standards No. 72.


 


(xiii)                          Holdings shall comply with
all applicable rules and regulations of the Commission and make generally
available to its security holders earnings statements satisfying the provisions
of Section 11(a) of the Act and Rule 158 thereunder (or any
similar rule promulgated under the Act) no later than forty-five (45) days
after the end of any twelve (12) month period (or ninety (90) days after the
end of any twelve (12) month period if such period is a fiscal year) (or in
each case within such extended period of time as may be permitted by the
Commission for filing the applicable report with the Commission) (A) commencing
at the end of any fiscal quarter in which Demand Securities are sold to
underwriters in a firm commitment or best efforts underwritten offering and (B) if
not sold to underwriters in such an offering, commencing on the first day of
the first fiscal quarter of Holdings after the effective date of a Registration
Statement, which statements shall cover said twelve (12) month period.


 


(xiv)                         Holdings shall cooperate
with each seller of Demand Securities covered by any Registration Statement and
each underwriter, if any, participating in the disposition of such Demand
Securities and their respective counsel in connection with any filings required
to be made with the NASD.


 


(xv)                            Holdings shall use
commercially reasonable best efforts to take all other steps necessary to
effect the registration of the Registered Securities covered by a Registration
Statement contemplated hereby.


 


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(d) 
Holdings agrees to indemnify and hold harmless each Registering Party, the
officers, directors, partners and fiduciaries of each Registering Party and
each person, if any, who controls such Party within the meaning of the Act or
the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and the officers,
directors, partners and fiduciaries of each such controlling person
(collectively the “Indemnified Parties”)
from and against any losses, claims, damages or liabilities, joint or several,
or any actions in respect thereof (including, but not limited to, any losses,
claims, damages, liabilities or actions relating to purchases and sales of the
Registered Securities) to which each Indemnified Party may become subject under
the Act, the Exchange Act or otherwise, insofar as such losses, claims,
damages, liabilities or actions arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in a
Registration Statement or prospectus or in any amendment or supplement thereto
or in any preliminary prospectus relating to a Registration Statement, or arise
out of, or are based upon, the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading, and shall reimburse, as incurred, each Indemnified
Party for any legal or other expenses reasonably incurred by it in connection
with investigating or defending any such loss, claim, damage, liability or
action in respect thereof; provided, however, that (i) Holdings shall not
be liable in any such case to the extent that such loss, claim, damage,
liability or action arises out of or is based upon any untrue statement or
alleged untrue statement or omission or alleged omission made in a Registration
Statement or prospectus or in any amendment or supplement thereto or in any
preliminary prospectus relating to a Registration Statement in reliance upon
and in conformity with written information pertaining to such Registering Party
and furnished to Holdings by or on behalf of such Registering Party
specifically for inclusion therein; (ii) with respect to any untrue
statement or omission or alleged untrue statement or omission made in any
prospectus relating to a Registration Statement, the indemnity agreement
contained in this subsection (d) shall not inure to the benefit of
any Registering Party from whom the person asserting any such losses, claims,
damages or liabilities purchased the Registered Securities concerned, to the
extent that a prospectus relating to such Registered Securities was required to
be delivered by such Registering Party under the Act in connection with such
purchase and any such loss, claim, damage or liability of such Registering
Party results from the fact that there was not sent or given to such person, at
or prior to the written confirmation of the sale of such Registered Securities
to such person, a copy of the final prospectus, as amended or supplemented, if
Holdings had previously furnished copies thereof to such Registering Party and (iii) the
foregoing indemnity agreement with respect to any preliminary prospectus shall
not inure to the benefit of any underwriter or Registering Party from whom the
person asserting any such loss, claim, damage or liability purchased the
Registered Securities if a copy of the prospectus included in the applicable
Registration Statement (as then amended or supplemented, if such amendment or
supplement was furnished by Holdings) was not sent or given by or on behalf of
any underwriter or Registering Party to such person, if such is required by
law, at or prior to the written confirmation of the sale of such Registered
Securities to such person and if the prospectus (as so amended or supplemented)
would have cured the defect giving rise to such loss, claim, damage or
liability; provided further, however, that this indemnity agreement will be in
addition to any liability which Holdings may otherwise have to such Indemnified
Party.  Holdings shall also indemnify underwriters, selling brokers,
dealer managers and similar securities industry professionals participating in
the distribution (in each case as described in a Registration Statement), their
officers and directors and each person who controls such persons within the


 


27





















 


meaning
of the Act or the Exchange Act to the same extent as provided above with
respect to the indemnification of the Registering Parties if requested by such
holders.


 


(e) 
Each Registering Party, severally and not jointly, will indemnify and hold
harmless Holdings and each person, if any, who controls Holdings within the
meaning of the Act or the Exchange Act from and against any losses, claims,
damages, liabilities or actions in respect thereof to which Holdings or any
such controlling person may become subject under the Act, the Exchange Act or
otherwise, insofar as such losses, claims, damages, liabilities or actions
arise out of or are based upon any untrue statement or alleged untrue statement
of a material fact contained in a Registration Statement or prospectus or in
any amendment or supplement thereto or in any preliminary prospectus relating
to a Registration, or arise out of or are based upon the omission or alleged
omission to state therein a material fact necessary to make the statements
therein not misleading (in the case of the prospectus or preliminary
prospectus, in light of the circumstances under which they were made), but in
each case only to the extent that the untrue statement or alleged untrue statement
or omission or alleged omission was made in reliance upon and in conformity
with written information pertaining to such Registering Party and furnished to
Holdings by or on behalf of such Registering Party specifically for inclusion
therein; and, subject to the limitation set forth immediately preceding this
clause, shall reimburse, as incurred, Holdings for any legal or other expenses
reasonably incurred by Holdings or any such controlling person in connection
with investigating or defending any loss, claim, damage, liability or action in
respect thereof.  This indemnity agreement will be in addition to any
liability which such Registering Party may otherwise have to Holdings or any of
its controlling persons.


 


(f) 
Promptly after receipt by an Indemnified Party under Section 4.3(d) or
(e) of notice of the commencement of any action or proceeding (including a
governmental investigation), such Indemnified Party will, if a claim in respect
thereof is to be made against any person (the “Indemnifying Party”) under Section 4.3(d) or
(e), notify the Indemnifying Party of the commencement thereof; but the
omission so to notify the Indemnifying Party will not, in any event, relieve
the Indemnifying Party from any obligations to any Indemnified Party other than
the indemnification obligation provided in Section 4.3(d) or (e) above
unless and to the extent that the Indemnifying Party has been prejudiced in any
material respect by such failure.  In case any such action is brought
against any Indemnified Party, and it notifies the Indemnifying Party of the
commencement thereof, the Indemnifying Party will be entitled to participate
therein and, to the extent that it may wish, jointly with any other
Indemnifying Party similarly notified, to assume the defense thereof, with
counsel reasonably satisfactory to such Indemnified Party (who shall not,
except with the consent of the Indemnified Party, be counsel to the
Indemnifying Party), and after notice from the Indemnifying Party to such
Indemnified Party of its election so to assume the defense thereof the
Indemnifying Party will not be liable to such Indemnified Party under Section 4.3(d) or
(e) for any legal or other expenses, other than reasonable costs of
investigation, subsequently incurred by such Indemnified Party in connection
with the defense thereof.  Notwithstanding the foregoing, an Indemnified
Party shall have the right to employ separate counsel in any such proceeding
and to participate in the defense thereof, but the fees and expenses of such
counsel shall be at the expense of such Indemnified Party or parties unless (i) the
Indemnifying Party has agreed to pay such fees and expenses; (ii) the
Indemnifying Party shall have failed promptly after notice to assume the
defense of such proceeding or shall have failed to employ counsel reasonably
satisfactory to such Indemnified Party; or (iii) the named parties to any
such proceeding (including any impleaded parties) include both such Indemnified


 


28





















 


Party
and the Indemnifying Party or any of its affiliates or controlling persons, and
such Indemnified Party shall have been advised in writing by counsel that
either (A) a conflict of interest may exist if such counsel represents
such Indemnified Party and the Indemnifying Party (or such affiliate or
controlling person) or (B) there may be one or more legal defenses
available to such Indemnified Party that are different from or in addition to
those available to the Indemnifying Party or such affiliate or controlling person
(in which case, if such Indemnified Party notifies the Indemnifying Parties in
writing that it elects to employ separate counsel at the expense of the
Indemnifying Parties, the Indemnifying Parties shall not have the right to
assume the defense thereof and the fees and expenses of such counsel shall be
at the expense of the Indemnifying Party; it being understood, however, that
the Indemnifying Party shall not, in connection with any one such proceeding or
separate but substantially similar or related proceedings in the same
jurisdiction, arising out of the same general allegations or circumstances, be
liable for the fees and expenses of more than one separate firm of attorneys
(together with appropriate local counsel) at any time for all such Indemnifying
Parties.  No Indemnifying Party shall be liable for any settlement of any
such proceeding effected without its written consent, but if settled with its
written consent, or if there be a final unappealable judgment for the plaintiff
in any such proceeding, each Indemnifying Party jointly and severally agrees,
subject to the exceptions and limitations set forth above, to indemnify and
hold harmless each indemnified party from and against any and all losses,
claims, damages or liabilities by reason of such settlement or judgment. 
No Indemnifying Party shall, without the prior written consent of the
Indemnified Party, effect any settlement of any pending or threatened action in
respect of which any Indemnified Party is or could have been a party sand indemnity
could have been sought hereunder by such Indemnified Party unless such
settlement includes an unconditional release of such Indemnified Party from all
liability on any claims that are the subject matter of such action.


 


(g) 
If the indemnification provided for in Section 4.3(d) or (e) is
unavailable or insufficient to hold harmless an Indemnified Party thereunder,
then each Indemnifying Party shall contribute to the amount paid or payable by
such Indemnified Party as a result of the losses, claims, damages, liabilities
or actions in respect thereof referred to in Sections 4.3(d) and (e) above
in such proportion as is appropriate to reflect the relative fault of the
Indemnifying Party or Parties on the one hand and the Indemnified Party on the
other in connection with the statements or omissions that resulted in such
losses, claims, damages or liabilities (or actions in respect thereof) as well
as any other relevant equitable considerations.  The relative fault of the
parties shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
Holdings, on the one hand, or such Registering Party or such other indemnified
person, as the case may be, on the other, and the parties’ relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.  The amount paid by an Indemnified Party as a
result of the losses, claims, damages, liabilities or actions referred to in
the first sentence of this subsection (g) shall be deemed to include
any legal or other expenses reasonably incurred by such Indemnified Party in
connection with investigating or defending any action or claim which is the
subject of this Section 4.3(g), the Registering Party shall not be
required to contribute any amount in excess of the amount by which the net
proceeds received by such holders from the sale of Registered Securities
pursuant to a Registration Statement exceeds the amount of damages which such
holders have otherwise been required to pay by reason of such untrue or alleged
untrue statement or omission or alleged


 


29





















 


omission. 
No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation.  The parties agree that it would not
be just and equitable if contribution pursuant to this section were
determined by pro rata allocation or by any other method that does not take
account of the equitable considerations referred to above.  For purposes
of this subsection (g), each person, if any, who controls such Indemnified
Party within the meaning of the Act or the Exchange Act shall have the same
rights to contribution as such Indemnified Party and each person, if any, who
controls the Company within the meaning of the Act or the Exchange Act shall
have the same rights to contribution as the Company.


 


(h) 
The agreements contained in Sections 4.3(d) through (g) shall survive
the sale of the Registered Securities pursuant to a Registration Statement and
shall remain in full force and effect, regardless of any termination or
cancellation of this Agreement or any investigation made by or on behalf of any
indemnified party.


 


4.4  Definition of Common
Stock.


 


For the purposes of this Article 4, the term “common
stock” shall include any securities issued or issuable with respect to such
securities by any of stock dividend or stock split or in connection with a
combination of shares, recapitalization, merger, consolidation or other
reorganization or otherwise.


 


4.5  Designation of
Underwriters.


 


In connection with any underwritten public offering
pursuant to a Demand Registration, the holders of a majority of Demand
Securities shall select the managing underwriter, counsel and co-manager if one
is desired by them (with the consent of Holdings, such consent not to be
unreasonably withheld).


 


5.  SPECIAL WHITNEY
PRIVILEGES


 


5.1  Whitney Board Designee.


 


Prior to an Initial Public Offering and subject to Section 5.1(i) below:


 


(a) 
the parties shall, at any annual meeting of stockholders of Holdings or any
special meeting of stockholders of Holdings, or by written consent, vote their
Shares to set the size of the Board to seven (7) directors; provided, that
if Whitney becomes entitled to designate an additional member of the Board
pursuant to Section 9.01(b) of the Third Stock Purchase Agreement
(such designee, a “Third Whitney Designee”),
then promptly thereafter, the Initial Parties shall take all action necessary
to increase the size of the Board to eight (8) directors, and thereafter,
the parties shall, at any annual meeting of stockholders of Holdings or any
special meeting of stockholders of Holdings, or by written consent, vote their
Shares to set the size of the Board to eight (8) directors.


 


(b) 
prior to January 1, 2007, the Parties shall, at any annual meeting of
stockholders of Holdings or any special meeting of stockholders of Holdings
called for the


 


30





















 


purpose
of electing directors, or by written consent, vote their Shares for the
election of the following members of the Board:


 


(i)                                     two (2) members of
the Board designated by Whitney V; provided, that if Whitney becomes entitled
to designate a Third Whitney Designee pursuant to Section 9.01(b) of
the Third Stock Purchase Agreement, Whitney shall be entitled to designate three
(3) members of the Board pursuant to this Section 5.1(b)(i), provided
further, that at each time of election or re-election of any such Third Whitney
Designee, he or she, if not an employee of Whitney, shall be reasonably
acceptable to Hartnett;


 


(ii)                                  four (4) members of
the Board designated by the holders of a majority of the Hartnett Securities;
and


 


(iii)                               William Killian (“Killian”), or his successor determined
in accordance with Section 5.1(f).


 


(c) 
on and after January 1, 2007, the Parties shall, at any annual meeting of
stockholders of Holdings or any special meeting of stockholders of Holdings
called for the purpose of electing directors, or by written consent, vote their
Shares for the election of the following members of the Board:


 


(i)                                     two (2) members of
the Board designated by Whitney V; provided, that if Whitney becomes entitled
to designate a Third Whitney Designee pursuant to Section 9.01(b) of
the Third Stock Purchase Agreement, Whitney shall be entitled to designate
three (3) members of the Board pursuant to this Section 5.1(c)(i),
provided further, that at each time of election or re-election of any such
Third Whitney Designee, he or she, if not an employee of Whitney, shall be
reasonably acceptable to Hartnett;


 


(ii)                                  three (3) members of the
Board designated by the holders of a majority of the Hartnett Securities;


 


(iii)                               one (1) other person
mutually agreeable to Hartnett and Whitney V (the “Independent Director”); and


 


(iv)                              Killian, or his successor
determined in accordance with Section 5.1(f).


 


(d) 
the Board shall not act through any committee or similar body unless the
directors designated by Whitney V pursuant to Section 5.1(b)(i) or
5.1(c)(i) above (as the case may be, the “Whitney Designees”) and the directors designated by
holders of a majority of the Hartnett Securities pursuant to Section 5.1(b)(ii) or
5.1(c)(ii) above (as the case may be, the “Hartnett Designees” and together with the Whitney
Designees, the “Designees”)
have been provided the continuing opportunity to join as a member thereof.


 


(e) 
Whitney and the holders of a majority of the Hartnett Securities, respectively,
may remove from the Board the Whitney Designee or Hartnett Designee, as
applicable, in its or their sole discretion and without providing notice to the
other Parties.  Upon the resignation or removal of any Whitney Designee or
Hartnett Designee, the other Parties shall vote their Shares


 


31





















 


for
such replacement director as shall be designated by Whitney or the holders of a
majority of the Hartnett Securities, as applicable (in the case of a Third
Whitney Designee who is not an employee of Whitney, subject to Hartnett’s
reasonable approval).  No Whitney Designee or Hartnett Designee,
respectively, may be removed from the Board without the vote or consent of a
majority of the holders of the Whitney Securities or the Hartnett Securities,
as applicable, absent fraud or willful misconduct by such individual.


 


(f) 
Upon the resignation or removal of Killian or the Independent Director from the
Board, the Parties shall vote their Shares for such replacement director as
shall be mutually agreeable to both Hartnett and Whitney.


 


(g) 
In no event shall Board meetings or any meetings of a committee of the Board
(collectively, “Board Meetings”)
be convened without affording the Designees with two (2) business days’
written notice to attend such a meeting.  The Designees shall be provided
with all information and materials provided to the other directors for such a
meeting.  All Board Meetings shall either be held at locations reasonably
convenient to the Designees or, in the alternative, the Designees shall be
permitted to participate in such Board Meeting telephonically.


 


(h) 
The parties hereto shall take all action within their power (including in the
case of Holdings, voting the capital stock of RBCA) to provide that the
composition of the board of directors of RBCA be identical to that of the Board
and Holdings shall afford Whitney the opportunity to designate one (1) member
of the governing bodies of all other entities over which Holdings has Control.
 The parties’ rights with respect to designees on the board of directors
of RBCA shall be identical to the rights of such parties with respect to the
Board.  Whitney’s designee on such other governing bodies shall be
entitled to all rights in respect of its membership in the governing body of
any such entity as the Whitney Designees have in respect of the Board.


 


(i) 
(A) Whitney shall forfeit its right to appoint one member of the Board
pursuant to Sections 5.1(b)(i) and 5.1(c)(i) above at any time that
(x) the Minimum Whitney Common Ownership equals or is less than 20% or (y) the
Minimum Whitney Preferred Ownership equals or is less than 20%; (B) the
provisions of Section 5.1(c)(iii) shall not apply (and instead a
majority of the Hartnett Securities shall have the right to designate four (4) members
of the Board pursuant to Section 5.1(c)) at any time that the Minimum
Whitney Preferred Ownership equals or is less than 20%; and (C) Whitney
shall forfeit its right to appoint any member of the Board pursuant to Sections
5.1(b)(i) and 5.1(c)(i) above and its right to participate in the
designation under Section 5.1(c)(iii) above, upon the occurrence of
both (A)(x) and (B)(x) hereof.


 


5.2  Whitney’s Written
Consent.


 


Prior to an Initial Public Offering and for so long
as the Minimum Whitney Common Ownership exceeds twenty percent (20%), Holdings
shall not take, and shall cause its subsidiaries not to take, any of the
following actions without the prior written consent of Whitney:


 


32





















 


(a) 
Any redemption or other repurchase of equity securities by Holdings consisting
of more than ten percent (10%) in the aggregate of the Outstanding Common
Shares on the date hereof; provided, however, that any redemption or other
repurchase of Securities held by Hartnett or his Permitted Transferees may not
be effected without the prior written consent of Whitney, provided further,
however, that by execution of this Agreement, Whitney hereby consents to the
exercise by Holdings from time to time of the Call Option.


 


(b) 
A sale, lease, exchange or other distribution (including by way of merger or
consolidation) of all or substantially all of Holdings’ and its Subsidiaries’
property and assets prior to thirty (30) months following the date hereof for a
consideration that will result in, after giving effect to such transaction, a
Whitney IRR of less than 25%; provided, however, that such action
shall not require the prior written consent of Whitney from and after such time
that Whitney transfers any Whitney Securities to a Person other than a
Permitted Transferee.


 


(c) 
Any acquisition or series of related acquisitions by Holdings or any of its
subsidiaries, by way of merger, consolidation, stock purchase, asset purchase
or otherwise, of any Person in which Holdings or any of its Subsidiaries will
pay consideration of $30,000,000 or more in the aggregate.


 


(d) 
The entering into any agreement, transaction or arrangement between Holdings or
any of its subsidiaries, on the one hand, and Hartnett or any holder of more
than five percent (5%) of the Outstanding Common Shares, on the other hand,
other than the Hartnett Employment Agreement, the Management Services Agreement,
any grant of options or warrants to Hartnett permitted pursuant to subsection (f) below
or the issuance of any shares of Common Stock or Preferred Stock to Whitney
pursuant to the Holdings Certificate of Incorporation, the Third Stock Purchase
Agreement, the New Stock Purchase Agreement or the Old Stock Purchase
Agreement, provided, however, that by execution of this Agreement, Whitney
hereby consents to the exercise by Holdings from time to time of the Call
Option.


 


(e) 
Changes in the general lines of business from those currently conducted by
Holdings and its subsidiaries.


 


(f) 
Any grant of options or warrants granted from and after the date hereof
pursuant to management option plans heretofore or hereafter approved by the
Board to purchase Common Stock which, when taken together with all other
options and warrants issued following the date hereof pursuant to this subsection (f),
exceed 396,241.50 shares (subject to adjustment to reflect any stock split,
stock dividend, reclassification, recapitalization or other transaction having
a similar effect); provided, however, that any grant of options or warrants to
Hartnett following the date hereof which, when taken together with all other
options and warrants granted to Hartnett pursuant to this subsection (f),
would be in excess of 242,669 shares (subject to adjustment to reflect any
stock split, stock dividend, reclassification, recapitalization or other
transaction having a similar effect) shall require prior written consent of
Whitney.


 


(g) 
Any issuance of Common Stock by Holdings at a price per share below the fair
market value of such shares as determined in good faith by the Board.  If
the holders of a majority of the Whitney Securities disagree with such Board
determination, the disagreement regarding the fairness of the issuance price
shall be resolved by binding arbitration.  In the event


 


33





















 


of
a dispute, the holders of a majority of the Whitney Securities may notify
Holdings in writing of its request for such arbitration and its choice of an
arbitrator.  Within thirty (30) days following its receipt of such a
request, Holdings shall notify the holders of a majority of the Whitney
Securities of its choice of an arbitrator.  The arbitrators so chosen
shall meet within thirty (30) days thereafter and select a third arbitrator and
commence the arbitration in accordance with rules agreed by the
parties.  If the parties are unable to agree on such rules, the
arbitrators shall establish them by a majority vote.  The holders of the
Whitney Securities and Holdings shall bear their own costs and expenses, and
the fees and expenses of the arbitrators shall be divided equally between the
parties, unless arbitrators rule by a majority vote that a party has not acted
in good faith with regard to the institution, conduct and/or the subject of the
arbitration.  In the event of such a ruling, the arbitrators shall require
such party to pay all of the arbitrators’ costs and expenses, as well as some
or all of the other party’s arbitration costs and expenses, in the discretion
of the arbitrators.  By execution of this Agreement, Whitney agrees that
the issuance and sale of Class A Preferred Stock pursuant to the Third
Stock Purchase Agreement is for fair market value and agrees not to challenge
such determination by the Board.


 


(h) 
Any issuance of capital stock having liquidation, dividend, or distribution
rights (i) senior to the Class B Preferred Stock, Class C
Preferred Stock or Class D Preferred Stock, or (ii) senior to, or
pari passu with, the Class A Preferred Stock provided, however, that by
execution of this Agreement, Whitney consents to the issuance and sale of Class A
Preferred Stock pursuant to the Third Stock Purchase Agreement.


 


5.3  Whitney’s Right to Information.


 


(a) 
Prior to an Initial Public Offering, and so long as the Minimum Whitney Common
Ownership exceeds twenty percent (20%), Holdings shall provide to Whitney or
the Whitney Designee (i) monthly, quarterly and annual financial
statements, but only to the extent, and in such form, as are normally prepared
by Holdings and/or Roller Bearing Company of America, Inc., (ii) copies
of all significant reports submitted to Holding’s certified public accountants
in connection with each annual, interim or special audit or review of any type
of the financial statements or related internal control systems of Holdings and
its subsidiaries made by such accountants, including any comment letter
submitted by such accountants, including any comment letter submitted to such
accountants to management in connection with their services, (iii) for so
long as Holdings is subject to the reporting requirements of Section 13(a) or
15(d) of the Exchange Act, all information and reports required to be
delivered by Holdings under the reporting requirements of Section 13(a) or
15(d) of the Exchange Act when and as delivered to the Commission or the
securities holders of Holdings, (iv) all press releases and other
statements made available by Holdings or any of its subsidiaries to the public
concerning material developments in the business of Holdings or its
subsidiaries, (v) not less than fifteen (15) days prior to creating a new
subsidiary or acquiring the stock of, or other equity interests in a Person,
such that such Person will become a subsidiary, written notice of the intention
of Holdings or any of its subsidiaries to create such a subsidiary or acquire
such stock or equity interests, and (vi) such other information and data
with respect to Holdings or any of its subsidiaries as from time to time may be
reasonably required by the holders of the Whitney Securities.  The
delivery of such financial statements shall not be deemed to constitute a
representation by Holdings respecting the accuracy of the information contained
therein.


 


34





















 


(b) 
Holdings shall permit, and will cause each of its subsidiaries to permit,
representatives of Whitney or its Permitted Transferees to visit and inspect
any of their properties, to examine their corporate, financial and operating
records and make copies thereof or abstracts therefrom, and to discuss their
affairs, finances and accounts with their respective directors, officers and
independent public accountants, all at such reasonable times during normal
business hours and as often as may be reasonably requested, upon reasonable
advance notice.


 


6.  AFFIRMATIVE
COVENANTS


 


Prior to an Initial Public Offering and so long as
the Minimum Whitney Common Ownership exceeds twenty percent (20%), Holdings hereby
covenants with Whitney as follows:


 


6.1  Preservation of
Corporate Existence.


 


Holdings shall, and shall cause each of its
subsidiaries to:


 


(a) 
preserve and maintain in full force and effect its corporate (or, as
applicable, limited liability company or other entity) existence; provided,
that Holdings and its subsidiaries will not be subject to such requirement if
the Board determines in good faith that it is not in Holdings’ best interest to
do so; and


 


(b) 
file or cause to be filed in a timely manner all material reports, applications
and licenses that shall be necessary for the conduct of its business.


 


6.2  Payment of Obligations.


 


Holdings shall, and shall cause each of its
subsidiaries to, pay and discharge, within a reasonable time from the time that
such payment or liability shall become due and payable, (and the expiration of
any grace period related thereto) all their respective material obligations and
liabilities known to Holdings, including without limitation:


 


(a) 
all known tax liabilities, assessments and governmental charges or levies upon
it or its properties or assets, unless the same are being contested in good
faith by appropriate proceedings and adequate reserves in accordance with
generally accepted accounting principles (“GAAP”)
are being maintained by Holdings or such subsidiary; and


 


(b) 
all known lawful claims which Holdings and each of its subsidiaries is
obligated to pay, which are due and which, if unpaid, might by law become a
lien upon its property, unless the same are being contested in good faith by
appropriate proceedings and adequate reserves in accordance with GAAP are being
maintained by Holdings or such subsidiary.


 


6.3  Compliance with Laws.


 


Holdings shall comply, and shall cause each of its
subsidiaries to comply, in all material respects, with applicable laws and with
the written directions of each governmental authority


 


35





















 


having
jurisdiction over them or their business or property (including, without
limitation all applicable environmental laws).


 


6.4  Insurance.


 


Holdings and its subsidiaries will maintain or cause
to be maintained with financially sound and reputable insurers that have a
rating of “A” or better as established by Best’s Rating Guide (or an equivalent
rating with such other publication of a similar nature as shall be in current
use), public liability and property damage insurance with respect to their
respective businesses and properties against loss or damage of the kinds and in
amounts customarily carried or maintained by companies of established
reputation engaged in similar businesses.


 


6.5  Books and Records.


 


Holdings shall, and shall cause each of its
Subsidiaries to, keep proper books of record and account, in which full and
correct entries shall be made of all financial transactions and the assets and
business of Holdings and each of its Subsidiaries in accordance with GAAP
consistently applied to Holdings and its Subsidiaries taken as a whole.


 


6.6  Recourse.


 


Any monetary proceeds received by Whitney for a
violation of this Article 6 must be shared with the other holders of
equity Securities of Holdings on a pro rata basis.


 


7.  TERMINATION;
AMENDMENT; WAIVER


 


7.1  Termination; Amendment.


 


(a) 
This Agreement may be terminated and the terms hereof amended at any time by
the execution of a written instrument signed by each of the Initial Parties or,
as to any of them, a Person designated by any such Initial Party in accordance
with Section 2.6.


 


(b) 
In the event of the termination of this Agreement, this Agreement shall
forthwith become void and have no effect, without any liability on the part of
any party hereto or any of their directors, officers, partners or stockholders.


 


7.2  Waiver.


 


Any agreement on the part of any Party hereto as to
any waiver of any of its rights hereunder shall be valid only if set forth in
an instrument in writing signed on behalf of such Party.


 


8.  MISCELLANEOUS


 


8.1  Notices.


 


Any notice, request, instruction, or other
communication to be given hereunder by any party to another shall be in writing
and shall be deemed to have given if delivered by hand or


 


36





















 


sent
by telecopier (transmission confirmed), certified or registered mail (return
receipt requested), postage prepaid, or by overnight express service, addressed
to the respective party or parties at the following addresses:


 


	
   

  	
  If
  to Holdings:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Roller
  Bearing Holding Company, Inc.

  
	
   

  	
   

  	
  60
  Round Hill Road

  
	
   

  	
   

  	
  P.O. Box
  430

  
	
   

  	
   

  	
  Fairfield,
  Connecticut 06430-0430

  
	
   

  	
   

  	
  Telecopier:

  	
   

  	
  203-256-0775

  
	
   

  	
   

  	
  Attention:

  	
   

  	
  Chief
  Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
  with
  a copy (which shall not constitute notice) to:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  McDermott,
  Will & Emery

  
	
   

  	
   

  	
  50
  Rockefeller Plaza

  
	
   

  	
   

  	
  New
  York, New York 10020

  
	
   

  	
   

  	
  Telecopier:

  	
   

  	
  212-547-5444

  
	
   

  	
   

  	
  Attention:

  	
   

  	
  C.
  David Goldman, Esq.

  
	
   

  	
   

  	
   

  
	
   

  	
  If
  to any Whitney Party, to:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Whitney &
  Co.

  
	
   

  	
   

  	
  177
  Broad Street

  
	
   

  	
   

  	
  Stamford,
  Connecticut 06901

  
	
   

  	
   

  	
  Telecopier:

  
	
   

  	
   

  	
  Attention:

  	
   

  	
  Michael
  R. Stone, Ransom A. Langford,

  
	
   

  	
   

  	
   

  	
   

  	
  Kevin
  Curley, Joseph Carrabino

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  With
  a copy (which shall not constitute notice) to:

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Kirkland &
  Ellis

  
	
   

  	
   

  	
  153
  East 53rd Street

  
	
   

  	
   

  	
  New
  York, NY 10022-4675

  
	
   

  	
   

  	
  Telecopier:

  	
   

  	
  212-446-4900

  
	
   

  	
   

  	
  Attention:

  	
   

  	
  Frederick
  Tanne, Esq.

  
	
   

  	
   

  	
   

  
	
   

  	
  If
  to Hartnett:

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Dr. Michael
  J. Hartnett

  
	
   

  	
   

  	
  c/o
  Roller Bearing Holding

  
	
   

  	
   

  	
  Company, Inc.

  
	
   

  	
   

  	
  60
  Round Hill Road

  
	
   

  	
   

  	
  P.O. Box
  430

  
	
   

  	
   

  	
  Fairfield,
  Connecticut 06430-0430

  
	
   

  	
   

  	
  Telecopier:

  	
   

  	
  203-256-0775

  



 


37





















 


	
   

  	
  with
  a copy (which shall not constitute notice) to:

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  McDermott,
  Will & Emery

  
	
   

  	
   

  	
  50
  Rockefeller Plaza

  
	
   

  	
   

  	
  New
  York, New York 10020

  
	
   

  	
   

  	
  Telecopier:

  	
   

  	
  212-547-5444

  
	
   

  	
   

  	
  Attention:

  	
   

  	
  C.
  David Goldman, Esq.

  



 


or
to such other address or addresses as any party may designate to the others by
like notice as set forth above.  Any notice given hereunder shall be
deemed given and received on the date of hand delivery or transmission by
telecopier, or three days after mailing by certified or registered mail or one
day after delivery to an overnight express service for next day delivery, as
the case may be.


 


8.2  Entire Agreement.


 


This Agreement contains the entire agreement between
the Parties with respect to the subject matter contemplated hereby and
expressly supersedes in its entirety the Existing Stockholders’ Agreement.


 


8.3  Captions.


 


The captions of the various Articles and Sections of
this Agreement have been inserted only for convenience of reference and shall
not be deemed to modify, explain, enlarge or restrict any provision of this
Agreement or affect the construction hereof.


 


8.4  No Third Party
Beneficiary.


 


Nothing expressed or implied in this Agreement is
intended, or shall be construed, to confer upon or give any person other than
the parties hereto and their respective heirs, personal representatives, legal
representatives, and successors, any rights or remedies under or by reason of
this Agreement.


 


8.5  Remedies Cumulative.


 


No remedy made available by any of the provisions of
this Agreement is intended to be exclusive of any other remedy, and each and
every remedy shall be cumulative and shall be in addition to every other remedy
given hereunder or now or hereafter existing at law or in equity.


 


8.6  Governing Law;
Submission to Jurisdiction.


 


(a) 
THIS AGREEMENT
SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK
AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF SAID
STATE WITHOUT GIVING EFFECT TO THE RULES OF SAID STATE GOVERNING THE CONFLICTS
OF LAWS.


 


38





















 


(b) 
The Parties hereby agree that any action, proceeding or claim against it
arising out of, or relating in any way to, this Agreement may be brought and
enforced in the courts of the State of New York or of the United States of
America for the Southern District of New York, and irrevocably submits to such
jurisdiction for such purpose.  The Parties hereby irrevocably waive any
objection to such exclusive jurisdiction or inconvenient forum.  Any such
process or summons to be served upon any of the Parties (at the option of the
party bringing such action, proceeding or claim) may be served by transmitting
a copy thereof, by registered or certified mail, return receipt requested,
postage prepaid, addressed to it at the address set forth in Section 8.1
hereof.  Such mailing shall be deemed personal service and shall be legal
and binding upon the Party so served in any action, proceeding or claim. 
Except with respect to disputes to be resolved in accordance with Section 5.2(g),
nothing herein shall affect the right of any party hereto to serve process in
any other manner permitted by law or to commence legal proceedings or otherwise
proceed against any other party in any other jurisdiction.


 


8.7  Assignment.


 


Except as otherwise set forth in this Agreement,
neither this Agreement nor any of the rights, interests or obligations
hereunder shall be assigned by any of the Parties hereto (whether by operation
of law or otherwise) without the prior written consent of the other
parties.  Subject to the preceding sentence, this Agreement will be
binding upon, inure to the benefit of and be enforceable by the parties and
their respective successors and assigns.


 


8.8  No Inconsistent
Agreements.


 


Holdings will not, on or after the date of this
Agreement, enter into any agreement or grant any rights to any Person that
conflicts with the provisions hereof.


 


8.9  Counterparts.


 


This Agreement may be executed in two or more
counterparts, each of which shall be considered one and the same agreement and
shall become effective when a counterpart has been signed by each of the
parties and delivered to the other party, it being understood that all parties
need not sign the same counterpart.


 


39





















 


IN WITNESS WHEREOF, the parties hereto have executed
this Amended and Restated Stockholders’ Agreement on this 6th day of February,
2003.


 


 


	
   

  	
  ROLLER BEARING HOLDING COMPANY,

  INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Michael J. Hartnett

  	
   

  
	
   

  	
   

  	
  Michael
  J. Hartnett

  	
   

  
	
   

  	
   

  	
  President
  and CEO

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  /s/
  Michael J. Hartnett

  	
   

  
	
   

  	
  Michael
  J. Hartnett

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  HARTNETT FAMILY INVESTMENTS, L.P.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Michael J. Hartnett

  	
   

  
	
   

  	
   

  	
  Michael
  J. Hartnett

  	
   

  
	
   

  	
   

  	
  General
  Partner

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  WHITNEY RBHC INVESTOR, LLC

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Whitney
  V, L.P.,

  	
   

  
	
   

  	
  its
  Managing Member

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Whitney
  Equity Partners V, LLC,

  	
   

  
	
   

  	
  its
  General Partner

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Duly Authorized Signatory

  	
   

  
	
   

  	
   

  	
  Name:
  

  	
  Duly
  Authorized Signatory

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Duly
  Authorized Signatory

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  WHITNEY V, L.P.

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Whitney
  Equity Partners V, LLC,

  	
   

  
	
   

  	
  its
  General Partner

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/Duly
  Authorized Signatory

  	
   

  
	
   

  	
   

  	
  Name:
  

  	
  Duly
  Authorized Signatory

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Duly
  Authorized Signatory

  	
   

  
	
   

  	
   

  	
   

  	
   

  



 


40