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Exhibit 10.14    
    

 
 

EXECUTIVE EMPLOYMENT AGREEMENT    
    

        THIS EXECUTIVE EMPLOYMENT AGREEMENT ("Agreement") is entered into as of April 26, 2006, by and between
Charles A. Sorrentino ("Executive"), and Houston Wire & Cable Company, a Delaware corporation
("HWCC") and HWC Wire & Cable Company, a Delaware corporation ("HWC"). 

R E C I T A L S:  

	A.
	HWCC
is the parent company of HWC. For purposes of this Agreement, the "Company" shall mean and refer to HWCC and HWC.

	B.
	The
Company is in the business of distributing, marketing and selling specialty wire and cable products and other wire and cable products (the
"Business").

	C.
	HWCC
and HWC employ Executive as their President and Chief Executive Officer, and Executive and the Company desire to enter into this agreement to set forth the terms and conditions of
Executive's employment with the Company.

	D.
	The
Company desires to bind Executive to certain restrictive covenants, and Executive agrees to be so bound, on the terms and conditions set forth herein. 

A G R E E M E N T S:  

        NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 

        1.    DEFINITIONS.    

        1.1    Affiliate:    "Affiliate" means, with respect to any Person,
any Person which Controls, is Controlled by or is under common Control with such Person. 

        1.2    Board of Directors:    "Board of Directors" shall mean the
board of directors of HWCC. 

        1.3    Compensation Committee:    "Compensation Committee" shall mean
a committee of the Board of Directors which has been delegated responsibility for employee compensation matters or, in the absence thereof, the entire Board of Directors. 

        1.4    Confidential and Proprietary Information:    "Confidential and Proprietary
Information" means all information and any idea in any form whatsoever, tangible or intangible, pertaining in any manner to the business of the Company or any Affiliate of the
Company, or to the Company's clients, consultants or business associates, unless the information is or becomes publicly known through lawful means
(other than disclosure by Executive, unless such disclosure by Executive is made in good faith in the course of performing Executive's duties under this Agreement, or with the express written consent
of the Board of Directors). 

        1.5    Control:    "Control" means (i) in the case of corporate
entities, direct or indirect ownership of more than fifty percent (50%) of the stock or participating assets entitled to vote for the election of directors; and (ii) in the case of
non-corporate entities (such as individuals, limited liability companies, partnerships or limited partnerships), either (A) direct or indirect ownership of more than fifty percent
(50%) of the equity interest or (B) the power to direct the management and policies of the noncorporate entity. 

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        1.6    Covered Entity:    "Covered Entity" means every Affiliate of
Executive, and every Person in which Executive has invested (whether through debt or equity securities), or to which Executive has contributed any capital or made any advances, or in which any
Affiliate of Executive has an ownership interest or profit sharing percentage, or a firm from which Executive or any Affiliate of Executive receives or is entitled to receive income, compensation or
consulting fees, or in which Executive or any Affiliate of Executive has an interest as a lender (other than solely as a trade creditor for the sale of goods or provision of services that do not
otherwise violate the provisions of this Agreement). The agreements of Executive contained herein specifically apply to each Person which is presently a Covered Entity or which becomes a Covered
Entity subsequent to the date of this Agreement. Notwithstanding the foregoing, nothing contained in this Agreement prohibits Executive or any Affiliate of Executive from owning less than five percent
(5%) of any class of voting securities registered under the Securities Exchange Act of 1934, as amended, of any issuer, and no such issuer shall be considered a Covered Entity solely by virtue of such
ownership or the incidents thereof. Further notwithstanding anything contained in the foregoing provisions to the contrary, the term "Covered Entity"
shall not include the Company, any Subsidiary of the Company, or any Affiliate of the Company or any such Subsidiary. 

        1.7    Discharge For Cause:    "Discharge For Cause" shall mean the
Board of Directors' termination of Executive's employment hereunder for any one or more of the following reasons: (i) a material breach by Executive of provisions of this Agreement other than
Section 4.1 or a material neglect by Executive of his assigned duties, which includes any failure to follow the written direction of the Board of Directors (other than by reason of disability),
or repeated refusal by Executive to perform his assigned duties (other than by reason of disability) which continues for thirty (30) days following receipt of written notice from the Board of
Directors; (ii) the commission by Executive of any act of fraud or embezzlement against Company or any of its Affiliates or the commission of any felony or act involving dishonesty;
(iii) the commission by Executive of any act of moral turpitude which actually causes financial harm to the Company or any of its Affiliates; (iv) a material breach by Executive of the
terms of Section 4.1 of this Agreement or any other confidentiality or non-disclosure agreement of Executive with the Company; or (v) Executive's commencement of employment
with another company while he is an employee of the Company without the prior consent of the Board of Directors. 

        1.8    Discharge Without Cause:    "Discharge Without Cause" shall
mean the Board of Directors' termination of Executive's employment hereunder during the term hereof for any reason other than a Discharge For Cause or due to Executive's death or Permanent Disability. 

        1.9    Intellectual Property:    "Intellectual Property" means all
discoveries, inventions, improvements, computer programs, formulas, ideas, devices, writings or other intellectual property (including any notes, records, reports, sketches, plans, memoranda and other
tangible information relating to such Intellectual Property), whether or not subject to protection under the patent or copyright laws, which Executive shall conceive solely or jointly with others, in
the course of, or within the scope of employment, or which relates directly to the business of the Company or its actual or anticipated research and development, or which was conceived or created
using the Company's materials or facilities, whether during or after working hours. 

        1.10    Permanent Disability:    "Permanent Disability" shall mean
Executive's inability to perform his duties hereunder due to a physical or mental condition for a period of one hundred twenty (120) consecutive days or an aggregate of one hundred eighty
(180) days in any twelve (12) month period. 

        1.11    Person:    "Person" means any individual, partnership, limited
partnership, corporation, limited liability company, association, joint stock company, trust, joint venture, unincorporated organization or any other entity. 

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        1.12    Restriction Period:    "Restriction Period" shall mean the
period commencing on the date hereof and continuing during Executive's employment with the Company and for a period of twenty-four (24) months following the date of termination of
Executive's employment with the Company. 

        1.13    Subsidiary:    "Subsidiary" shall mean any Person which is
Controlled, directly or indirectly, by the Company, including through the ownership of stock or other interests in one or more other business enterprises which are connected with the Company. 

        1.14    Termination For Good Reason:    "Termination For Good Reason"
shall mean voluntary termination of this Agreement by Executive if, without the prior consent of Executive: (i) the Company shall relocate its principal executive offices to a location outside
the Houston, Texas metropolitan area, (ii) there is a material reduction by the Company in Executive's responsibilities, duties, authority, title, or reporting relationship; or (iii) the
Company acts in any way that would reduce Executive's Base Salary (as defined or subsequently increased pursuant to Section 5.1) or if the Company adversely affects Executive's participation in
or materially reduces Executive's benefit under any benefit plan of the Company in which Executive is participating; provided, however, that Termination For Good Reason by the Executive shall not be
permitted unless (x) the Executive has given the Company at least thirty (30) day's prior written notice that he has a basis for a Termination For Good Reason, which notice shall specify
the facts and circumstances constituting a basis for Termination For Good Reason, and (y) the Company
has not remedied such facts and circumstances constituting a basis for Termination For Good Reason within such 30-day period. 

        2.    CAPACITIES AND DUTIES.    

        2.1    Title:    Executive is hereby employed in the capacity of President and Chief Executive Officer of HWCC and
HWC. Executive shall report directly to the Board of Directors and shall be subject to its supervision, control and direction. Executive will at all times abide by the Company's personnel policies in
effect from time to time and will faithfully, industriously and to the best of Executive's ability, experience and talents, perform all of the duties that may be required of and from Executive by the
Board of Directors pursuant to the express and implied terms hereof, consistent with Executive's status as the President and Chief Executive Officer of the Company. 

        2.2    Exclusive Services:    During the Term, Executive agrees to devote his best efforts and full business time to
rendering services to the Company. Executive is specifically restricted from being employed by any other company, other than a Subsidiary or an Affiliate of the Company, while employed by the Company
pursuant to this Agreement; provided that Executive's service on boards of directors shall not be considered employment in violation of this Section 2.2. 

        3.    TERM.    

        3.1    Term:    Subject to Sections 3.2, 3.3, 3.4, 3.5, 3.6 and 3.7,
the term of this Agreement shall be five (5) years, commencing on the date of this Agreement (the "Term"). 

        3.2    Discharge For Cause:    Executive's employment under this Agreement may be terminated (subject to the notice
and cure period set forth in Section 1.7, if applicable) upon written notice to Executive of a Discharge For Cause without further obligation by the Company, except for payment of any Base
Salary and expense reimbursement accrued and unpaid through the effective date of termination and except as otherwise required by law, such payment to be made within sixty (60) days following
such termination. The Company shall provide Executive in such written notification such facts as shall be reasonably necessary to apprise Executive of the basis for such Discharge For Cause. 

        3.3    Discharge Without Cause:    Executive's employment under this Agreement may be immediately terminated by the
Company upon written notice to Executive of a Discharge Without Cause. Subject to Sections 4.1, 4.2, 4.3, 4.4 and 4.5 below, upon termination pursuant to this 

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Section 3.3,
the Company shall continue to pay to Executive in accordance with the Company's general payroll practices as in effect from time to time, an amount equal to Executive's Base Salary
at the annual rate in effect at the time of termination for a period equal to twenty-four (24) months from the date of such termination ("Without Cause
Severance Pay"); provided that, if the Company has issued stock which is publicly traded on an established securities market, payments due during the first six
(6) months following such termination shall be deferred and paid on the first day of the seventh month following such termination to the extent necessary to comply with
Section 409A(a)(2) of the Internal Revenue Code of 1986, as amended (the "Code"). Without Cause Severance Pay shall also include all amounts of Base Salary and expense reimbursement accrued and
unpaid through the effective date of termination (except as otherwise required by law, such payment to be made within sixty (60) days following termination) and any Incentive Bonus to which
Executive is entitled pursuant to Section 5.2 as of the date of termination of Executive's employment (such payment to be made at the time provided in Section 5.2). Other than the
foregoing, Executive shall not be entitled to any payment for subsequent periods upon such termination of employment due to a Discharge Without Cause. As a condition to receiving Without Cause
Severance Pay, subject to Sections 3.8 and 3.11, Executive shall execute a release of all claims, whether known or unknown, against the Company and its officers, directors, agents and stockholders,
whether direct or indirect, other than claims for amounts and benefits required to be paid pursuant to this Section 3.3. 

        3.4    Termination For Good Reason:    This Agreement may be immediately terminated by Executive, subject to the
notice and cure provisions set forth in Section 1.14, upon written notice to the Company of a Termination For Good Reason. Upon termination pursuant to this Section 3.4, subject to
Sections 4.1, 4.2, 4.3, 4.4 and 4.5 below, the Company shall continue to pay to Executive, in accordance with the Company's general payroll practices as in effect from time to time, an amount equal to
Executive's Base Salary, at the annual rate in effect at the time of termination ("Good Reason Severance Pay"), for a period equal to
twenty-four (24) months from the date of such termination; provided that, if the Company has issued stock which is publicly traded on an established securities market, payments due
during the first six (6) months following such termination shall be deferred and paid on the first day of the seventh month following such termination to the extent necessary to comply with
Code Section 409A(a)(2). Good Reason Severance Pay shall also include all amounts of Base Salary and expense reimbursement accrued and unpaid
through the effective date of termination (except as otherwise required by law, such payment to be made within sixty (60) days following termination) and any Incentive Bonus to which Executive
is entitled pursuant to Section 5.2 as of the date of termination of Executive's employment (such payment to be made at the time provided in
Section 5.2). Other than the foregoing, Executive shall not be entitled to any payment upon such termination of employment due to a Termination
for Good Reason. As a condition to receiving Good Reason Severance Pay, subject to Sections 3.8 and 3.11, Executive shall execute a release of all
claims, whether known or unknown, against the Company and its officers, directors, agents and stockholders, whether direct or indirect, other than claims for amounts and benefits required to be paid
pursuant to this Section 3.4. 

        3.5    Termination Upon Death:    This Agreement shall be immediately terminated without action or notice by either
party upon the death of Executive and without further obligation by the Company, except for
payment of all amounts of Base Salary and expense reimbursement accrued and unpaid through the effective date of termination (except as otherwise
required by law, such payment to be made within sixty (60) days following Executive's death) and any Incentive Bonus to which Executive is entitled pursuant to Section 5.2 as of the date
of death (such payment to be made at the time provided in Section 5.2). 

        3.6    Termination Upon Permanent Disability:    Executive's employment under this Agreement may be immediately
terminated by the Company upon written notice of termination for the Permanent Disability of Executive. Upon termination pursuant to this Section 3.6, the Company shall continue to 

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pay
to Executive, in accordance with the Company's general payroll practices as in effect from time to time, an amount equal to Executive's Base Salary, at the annual rate in effect at the time of
termination, for a period equal to twelve (12) months from the date of termination (or, if less, for the remaining Term of this Agreement) ("Permanent Disability
Severance Pay"); provided that, if the Company has issued stock which is publicly traded on an established securities market, payments due during the first six
(6) months following such termination shall be deferred and paid on the first day of the seventh month following such termination to the extent necessary to comply with Code
Section 409A(a)(2). Permanent Disability Severance Pay shall also include all amounts of Base Salary and expense reimbursement accrued and unpaid through the effective date of termination
(except as otherwise required by law, such payment to be made within sixty (60) days following such termination) and any Incentive Bonus to which Executive is entitled pursuant to
Section 5.2 as of the date of termination of Executive's employment (such payment to be made at the time provided in Section 5.2). Permanent Disability Severance Pay shall be reduced by
the amount of any disability benefits paid during and for the same period to Executive under any disability insurance policy provided by the Company as a benefit to Executive. Other than the
foregoing, Executive shall not be entitled to any payment upon such termination of employment due to Permanent Disability. As a condition to receiving Permanent Disability Severance Pay, subject to
Sections 3.8 and 3.11, Executive shall execute a release of all claims, whether known or unknown, against the Company and its officers, directors, agents and stockholders, whether direct or indirect,
other than claims for amounts and benefits required to be provided pursuant to this Section 3.6. 

        3.7    Termination Without Good Reason:    This Agreement may be terminated by Executive Without Good Reason upon
thirty (30) days prior written notice to the Board of Directors. Upon termination by the Executive pursuant to this Section 3.7, Executive shall only be entitled to receive the amounts
of Base Salary and expense reimbursement accrued and unpaid through the effective date of termination, such payment to be made within sixty (60) days following such termination, and the Company
shall have no further obligations to Executive hereunder, except as otherwise required by law. 

        3.8    Entitlement To Benefits:    Notwithstanding any other Section of this Agreement, upon termination of
Executive's employment, Executive shall be entitled to all vested benefits, vested stock awards, vested stock options, accrued and unused vacation, return of personal effects, COBRA rights and other
rights which may not be waived or released as a matter of law, in addition to any other sums, benefits, or rights which are provided for in this Agreement. 

        3.9    Action Required to Terminate Executive:    Action by an approving vote of a majority of the members of the
Board of Directors other than Executive, taken at a meeting of the Board of Directors or by written consent of the Board of Directors shall be required to terminate Executive's employment pursuant to
Sections 3.2, 3.3 and 3.6 of this Agreement. 

        3.10    No Offset:    There shall be no offset of any kind to the payment of the Without Cause Severance Pay or the
Good Reason Severance Pay. 

        3.11    Exceptions To Release:    Any release that the Company requires Executive to sign shall contain exceptions to
the release for (i) any existing right to indemnification, contribution and a defense, (ii) any directors and officers and general liability insurance coverage of Executive,
(iii) Executive's rights as a shareholder, (iv) all vested rights of Executive, (v) Executive's right to enforce this Agreement, and (vi) any rights which cannot be waived
or released as a matter of law. 

        3.12    Code Section 409A Compliance.    This Agreement is to be construed and interpreted in a manner
consistent with Code Section 409A(a) (2), (3) and (4) and the parties hereto agree to amend this Agreement as necessary to avoid the imposition of penalty taxes under Code
Section 409A(a)(1)(B) against Executive. No payment required to be made hereunder shall be accelerated or deferred by the Company or Executive in a manner that would subject such payment to any
excise tax under Code Section 409A(a)(1)(B). 

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        4.    RESTRICTIVE COVENANTS.    

        4.1    Confidential and Proprietary Information:    During the Term and for a period of five (5) years
following the date of termination of Executive's employment with the Company (except as to trade secrets, which shall not be disclosed at any time), Executive acknowledges that he has as of the date
of this Agreement and will continue to have access to and use of Confidential and Proprietary Information and agrees that he will not, either directly or indirectly, and he will not permit any Covered
Entity which is Controlled by Executive to, either directly or indirectly, divulge to any Person or use any of the Confidential and Proprietary Information, except as required in connection with the
performance of Executive's duties to the Company. Executive and each Covered Entity (and if deceased, his personal representative) shall promptly, following a request therefor from the Company, return
to the Company, without retaining copies, all tangible items (including electronic data storage devices) which are or which contain Confidential and Proprietary Information. 

        4.2    Non-Competition; Non-Solicitation and No Disparagement:    Executive acknowledges and
agrees that: (i) through his continuing services to the Company, he will learn valuable trade secrets and other Confidential and Proprietary Information relating to the Company's businesses;
(ii) Executive's services to the Company are unique in nature, and (iii) the Company would be irreparably damaged if Executive were to provide services to any Person in violation of the
restrictions contained in this Agreement. Accordingly, as an inducement to the Company to enter into this Agreement, Executive agrees that except in Executive's capacity as an employee of the Company,
neither Executive nor any Covered Entity shall directly or indirectly, without the prior written consent of the Company (which may be withheld in its sole discretion), during the Restriction Period: 

	(a)
	engage
or participate in, anywhere in the Territory (as defined below), as an employee, owner, partner, shareholder, officer, director, member, manager, advisor, consultant, lender,
lessor, agent or (without limitation by the specific enumeration of the foregoing) otherwise, or permit his name to be used by or render services of any type for, any Competing Business (as defined
below) or any Person developing a Competing Business; provided, however, that nothing in this Agreement shall prevent Executive from acquiring or
owning, but solely as a passive investment, up to five percent (5%) of any class of voting securities registered under the Securities Exchange Act of 1934, as amended, of any issuer engaged in a
Competing Business;

	(b)
	take
any action which could reasonably be expected to divert from the Company any opportunity which would be within the scope of the Company's business;

	(c)
	solicit
or attempt to solicit any Person who is or has been (A) a customer of the Company at any time within one (1) year prior to the date of termination of Executive's
employment to purchase any product or service which may be provided by the Company, or (B) a customer, supplier, licensor, licensee or other business relation conducting business with the
Company at any time within one (1) year prior to the date of termination of Executive's employment, to cease doing business with, or to alter or limit its business relationship with, the
Company;

	(d)
	solicit,
attempt to solicit, or assist anyone else to solicit any Business Associate (as defined below) to terminate his, her or its association with the Company;

	(e)
	recruit,
solicit, hire or otherwise retain the services of any Business Associate, whether on a full-time basis, part-time basis or otherwise and whether as an
employee, independent contractor, consultant, advisor or in another capacity; or

	(f)
	make
(or cause to be made) to any Person any knowingly disparaging, derogatory or other negative statement about the Company or any of its officers, directors, employees or agents. 

        As
used herein, a "Competing Business" shall mean a business which is, in whole or in part, directly or indirectly, competitive with the
business of the Company as conducted at the time of 

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enforcement
of this Section 4.2 (if such enforcement occurs prior to the termination of Executive's employment) or at the time of the termination of Executive's employment (if enforcement of
this Section 4.2 occurs at or following such time) or under development at either such time, as the case may be, and expected to be introduced or undertaken within one year following such date
of enforcement. Without limiting the generality of the foregoing sentence, the term Competing Business shall include the Business. "Business Associate"
means any employee, representative, consultant or agent of the Company who is acting in such capacity as of the date hereof or has acted in such capacity at any time within the twelve
(12) month period immediately preceding the date of hire, recruitment, solicitation or retention by Executive or a Covered Entity. To "engage" in
a business means (x) to render services in (or with respect to) the Territory for that business, or (y) to own, manage, operate or control (or participate in the ownership, management,
operation or control of) an enterprise engaged in that business in (or with respect to) the Territory. To "solicit" means to encourage or induce, or to
take any action that is intended or calculated to encourage or induce, or which is reasonably likely to result in encouragement or inducement.
"Territory" means the United States of America. 

        4.3    Protection of and Rights to Intellectual Property:    All Intellectual Property developed by Executive during
the Term shall be the sole and exclusive property of the Company, without further compensation. Any Intellectual Property based upon Confidential and Proprietary Information and developed at any time
either during or following the Term shall be the property of the Company. Executive shall assign to the Company or its designees, the entire right, title and interest in said Intellectual Property.
Executive shall, at the Company's request and expense, make applications for domestic or foreign patents, execute all documents necessary thereto, assist in securing, defending or enforcing any such
title and right thereto, and assist the Company in any other claims or litigation involving said Intellectual Property. Consistent with applicable law, the Company acknowledges that no provision in
this Agreement is intended to require assignment of any of Executive's rights in an invention if no equipment, supplies, facilities, or trade secret information of the Company was used, and the
invention was developed entirely on Executive's own time, unless the invention relates to the Business or to the Company's current or demonstrably anticipated business, research or development, or the
invention results from any work performed by Executive for the Company. 

        4.4    Specific Performance:    Executive agrees that any violation by him of Sections 4.1, 4.2 or 4.3 of this
Agreement would be highly injurious to the Company and would cause irreparable harm to the Company. By reason of the foregoing, Executive consents and agrees that if he violates any provision of
Sections 4.1, 4.2 or 4.3 of this Agreement, the Company shall be entitled, in addition to any other rights and remedies that it may have, to apply to any court of competent jurisdiction in Houston,
Texas for specific performance and/or injunctive or other equitable relief in order to enforce, or prevent any
continuing violation of, the provisions of such Sections 4.1, 4.2 and 4.3. Executive also recognizes that the territorial, time and scope limitations set forth in Sections 4.1 and 4.2, as applicable,
are reasonable and are properly required for the protection of the Company, and, in the event that any such territorial, time or scope limitation is deemed to be unreasonable by a court of competent
jurisdiction, the Company and Executive agree, and Executive submits, to the reduction of any or all of said territorial, time or scope limitations to such an area, period or scope as said court shall
deem reasonable under the circumstances. If such partial enforcement is not possible, then to the extent permitted by law, the provision shall be deemed severed, and the remaining provisions of this
Agreement shall remain in full force and effect. Executive acknowledges that Sections 4.1, 4.2, 4.3, 4.4 and 4.5 of this Agreement shall survive termination of Executive's employment. If any covenant
in Section 4.1 or 4.2 is breached, then (to the extent permitted by law) the Restricted Period with respect to such covenant shall be extended by the number of days during which such breach
exists. 

        4.5    Impact of Breach of Section 4 on Certain Payments.    Executive agrees that the payment of any Without
Cause Severance Pay or Good Reason Severance Pay is conditioned on Executive's compliance with the provisions of Sections 4.1, 4.2 and 4.3. 

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        5.    COMPENSATION AND BENEFITS.    For Executive's services, the Company agrees to pay Executive compensation as
follows: 

        5.1    Salary:    Base compensation equal to an annual salary ("Base
Salary") of $425,000 to be paid according to the Company's general payroll practices as in effect from time to time. Executive's Base Salary will be subject to annual reviews
and increases (but not decreases) as approved by the Board of Directors and the Compensation Committee. Such annual reviews will be conducted on or about the conclusion of the Company's fiscal year. 

        5.2    Incentive Compensation Program:    Subject to the last sentence of this Section 5.2, the Company shall
pay an annual bonus ("Incentive Bonus") of up to 100% of the Base Salary for each fiscal year of the Company in which the Executive is employed by the
Company, based upon achievement of the performance target for such fiscal year as set forth in this Section 5.2. If the Company achieves less than 85% of the target for a fiscal year, then no
Incentive Bonus shall be paid for such fiscal year. If the Company achieves 100% of the target for a fiscal year, then the Incentive Bonus for that fiscal year shall be equal to 50% of the Base Salary
for that fiscal year. If the Company achieves 115% or more of the target for a fiscal year, then the Incentive Bonus for that year shall be equal to 100% of the Base Salary for that fiscal year. If
the Company achieves a percentage of the target for a fiscal year that is between any two of the 85%, 100% or 115% thresholds referred to above, then the Incentive Bonus shall be a percentage of the
Base Salary for that fiscal year calculated on a straight line basis between the percentage that would apply at those two thresholds. For example, (i) if the Company achieves 92.5% of the
target for a fiscal year, then the Incentive Bonus for that fiscal year shall be equal to 25% of the Base Salary for that fiscal year; and (ii) if the Company achieves 107.5% of the target for
a fiscal year, then the Incentive Bonus for that fiscal year shall be equal to 75% of the Base Salary for that
fiscal year. As used in this Section 5.2, the phrase "Base Salary for that year" means the rate of Base Salary in effect for a majority of that fiscal year (or, if no Base Salary rate was in
effect for a majority of such fiscal year, then the weighted average Base Salary for that fiscal year). No later than sixty (60) days after the beginning of each fiscal year, the Board of
Directors (or the Compensation Committee) and Executive shall mutually agree upon the performance target for such fiscal year, which performance target will be consistent with the Company's business
plan approved by the Board of Directors for such fiscal year. Notwithstanding anything to the contrary herein, the Company shall not be obligated to pay any Incentive Bonus for any fiscal year unless
Executive is employed by the Company at the end of that fiscal year; provided, however, that if Executive's employment is terminated pursuant to Sections 3.3, 3.4 or 3.6 of this Agreement after
June 30 of any fiscal year, Executive shall be entitled to receive a pro rata portion (determined on the basis of the ratio determined by dividing the number of days that Executive is employed
by the Company during such fiscal year by the total number of days in such fiscal year) of any Incentive Bonus that would otherwise have been earned if Executive were employed by the Company at the
end of such fiscal year. Executive shall be paid the Incentive Bonus by March 15 of the year following the fiscal year to which the Bonus relates, provided that if the audit of the Company and
its Subsidiaries is not completed by such date, payment shall be made within 60 days following the completion of the audit, but no later than December 31 of such year. 

        5.3    Reimbursement of Expenses:    The Company shall reimburse Executive for any reasonable business expenses
incurred by Executive in the ordinary course of the Company's business in accordance with the Company's reimbursement policies then in effect. These expenses shall be substantiated by invoices and
receipts, to be submitted by Executive within thirty (30) days after incurrence, and reimbursement shall be made by the Company within sixty (60) days following its receipt of all
necessary documentation with respect to such expenses. 

        5.4    Benefits:    During the Term, Executive shall be entitled to receive all benefits of employment generally
available to the Company's other executive employees when and as such benefits, if any, become available and Executive becomes eligible for them, including any sick leave, medical, dental, 

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life
and disability insurance benefits, long-term incentive plan, stock option plan, pension plan and/or profit-sharing plan. 

        5.5    Vacation:    During the Term, Executive shall be entitled to four (4) weeks of paid vacation each year
during the Term which shall accrue each January 1 during the Term. Executive will use his reasonable efforts to schedule vacation periods to minimize disruption of the Company's business. 

        5.6    Vehicle Allowance:    During the Term, Executive shall be entitled to a vehicle allowance of
$                  
1000.00 per month. Any automobile lease payments, insurance payments or other payments made by the Company with respect to any vehicle leased by the Company for Executive's use shall be credited
against such vehicle allowance. 

        5.7    Stock Plan:    Executive shall be eligible to participate in the Company's 2006 Stock Plan. 

        5.8    Withholding:    Executive authorizes the Company to make any and all applicable withholdings of federal and
state taxes and other items the Company may be required to deduct, as such items may exist under this Agreement or otherwise from time to time. 

        6.    SUCCESSORS AND ASSIGNS.    This Agreement is intended to bind and inure to the benefit of and be enforceable by
Executive, the Company and their respective heirs, successors and assigns, except that Executive shall not have any right to assign or otherwise transfer this Agreement, or any of Executive's rights,
duties or any other interest herein, to any party without the prior written consent of the Company, and any such purported assignment shall be null and void. 

        7.    SURVIVAL OF RIGHTS AND OBLIGATIONS.    The rights and obligations of the parties as stated herein shall survive
the termination of this Agreement. 

        8.    ENTIRE AGREEMENT.    

        8.1    Sole Agreement:    This Agreement (including any attachments and exhibits hereto) sets forth the parties' sole
and entire agreement regarding the subject matter hereof and supersedes any and all other agreements, statements and representations of the parties, including but not limited to any employment
agreement or other agreement regarding Executive's compensation or terms of employment entered into prior to the date hereof. 

        8.2    No Other Representations:    The parties acknowledge and agree that no party has made any representations
(i) concerning the subject matter hereof or (ii) inducing the other party to execute and deliver this Agreement, except those representations specifically referenced herein. The parties
have relied on their own judgment in entering into this Agreement. 

        9.    MODIFICATIONS OR WAIVERS.    Waivers or modifications of this Agreement, or of any covenant, condition or
limitation contained herein, are valid only if in writing duly executed by the parties hereto. 

        10.    GOVERNING LAW.    This Agreement shall be governed pursuant to federal law, as applicable or the laws of the
State of Texas, without giving effect to any choice of law or conflict of law provision or rule that would cause the application of the laws of any jurisdiction other than the State of Texas. 

        11.    SEVERABILITY.    If any part, clause or condition of this Agreement is held to be partially or wholly invalid,
unenforceable or inoperative for any reason whatsoever, such shall not affect any other provision or portion hereof, which shall continue to be effective as though such invalid, unenforceable or
inoperative part, clause or condition had not been made. If any provision, or its application to any Person or circumstance, is held by a court of competent jurisdiction or an arbitrator pursuant to
Section 16 hereof to be invalid or unenforceable, the court or the arbitrator is empowered to and shall modify any such provision so as to be enforceable. All remaining provisions shall remain
valid and enforceable. 

9

 

        12.    INTERPRETATION.    

        12.1    Section Headings:    The section and subsection heading of this Agreement are included for purposes of
convenience only, and shall not affect the construction or interpretation of any of its provisions. 

        12.2    Gender and Number:    Whenever required by the context, the singular shall include the plural, the plural
shall include the singular, and the masculine gender shall include the neuter and feminine genders and vice versa. 

        13.    NOTICES.    All notices and other communications under or in connection with this Agreement shall be in writing
and shall be deemed given (i) if delivered personally, upon delivery, (ii) if delivered by registered or certified mail (return receipt requested), upon the earlier of actual delivery or
three (3) days after being mailed, (iii) if given by overnight courier with receipt acknowledgment requested, the next business day following the date sent, or (iv) if given by
telecopy, upon confirmation of transmission by telecopy, in each case to the parties at the following addresses:

	To the Company:	 	Houston Wire & Cable Company

10201 North Loop East

Houston, TX 77029

Facsimile: (713) 609-2168

Attention: Chairman of the Board
	

with a copy to:	
 	

Schiff Hardin LLP

6600 Sears Tower

Chicago, Illinois 60606

Facsimile: (312) 258-5600

Attention: Jeffrey N. Smith
	

To Executive:	
 	

Charles A. Sorrentino

2920 Cason Street

Houston, TX 77005

        14.    JOINT PREPARATION.    Each of the parties to this Agreement has negotiated it at length, and has had the
opportunity to consult with and be represented by its or his own competent counsel. This Agreement is therefore deemed to have been jointly prepared by the parties and any uncertainty or ambiguity
existing in it shall not be interpreted against any party, but rather shall be interpreted according to the rules generally governing the interpretation of contracts. 

        15.    THIRD-PARTY BENEFICIARIES.    No term or provision of this Agreement is intended to be, or shall be, for the
benefit of any Person not a party hereto, and no such other Person shall have any right or cause of action hereunder, except for Executive's spouse and his estate, both of which are third party
beneficiaries. 

        16.    MEDIATION AND ARBITRATION.    If requested by the Company or Executive, any unresolved controversy or claim
arising from or related to this Agreement or breach hereof shall be resolved by use of mediation initially, and if that fails to resolve the matter, by arbitration. Mediation shall be in Houston,
Texas, before one mediator qualified in mediation of employment matters agreed upon by the parties, or if no agreement on a mediator is reached, before a mediator chosen according to the American
Arbitration Association ("AAA") National Rules for the Resolution of Employment Disputes, specifically the Employment Mediation Rules. There shall be only one mediator. The parties will use best
efforts to obtain a mediator and complete the mediation within thirty (30) days from the date of request for mediation. If the mediation has not been completed within forty-five
(45) days from the date of request for mediation, any party may, by notice to all other parties and the AAA, forgo mediation and move directly to arbitration under the AAA National Rules for
the Resolution of 

10

 

Employment
Disputes; provided, however, that such arbitration shall be before three arbitrators, not one, and shall be in Houston, Texas. Also, by written agreement signed by the Company and
Executive, the parties hereto may agree to forgo mediation, may make any agreement regarding scheduling of the mediation or the arbitration process, discovery or hearing, which agreement shall be
binding on the mediator or arbitrator, despite any AAA rule to the contrary. In any arbitration, if the Executive is the prevailing party, the Company shall pay all reasonable attorney's fees of
Executive, as well as the expenses and administrative fees related to the arbitration. If the Company is the prevailing party at the arbitration, each party shall pay its own attorney's fees and
expenses and its share of the administrative fees and expenses related to the arbitration. Notwithstanding the foregoing provisions of this Section 16, (i) the parties are not required
to arbitrate any issue for which injunctive relief is sought by any party hereto, (ii) all parties may seek injunctive relief in any federal or state court having jurisdiction located in Harris
County, Texas, and (iii) claims of worker's compensation and unemployment compensation shall not be subject to arbitration under this Agreement. 

        17.    COOPERATION AND FURTHER ACTIONS.    The parties agree to perform any and all acts and to execute and deliver
any and all documents necessary or convenient to carry out the terms of this Agreement. 

        18.    COUNTERPARTS.    This Agreement may be executed in two or more counterparts, including electronically
transmitted counterparts, each of which shall be deemed an original and all of which shall be considered one and the same instrument. 

[Signature
Page Follows] 

11

 
[SIGNATURE
PAGE TO CHARLES A. SORRENTINO

EXECUTIVE EMPLOYMENT AGREEMENT] 

        IN
WITNESS WHEREOF, the parties hereto have executed, or caused their duly authorized representatives to execute, this Agreement as of the Effective Date. 

	 	 	EXECUTIVE
	 	 	 	 	 
	 	 	 	 	 
	 	 	/s/  CHARLES A. SORRENTINO      
 Charles A. Sorrentino
	 	 	 	 	 
	 	 	 	 	 
	 	 	HOUSTON WIRE & CABLE COMPANY
	 	 	 	 	 
	 	 	 	 	 
	 	 	By:	 	/s/  PETER M. GOTSCH      
 Peter M. Gotsch
 Chairman of the Board
	 	 	 	 	 
	 	 	 	 	 
	 	 	HWC WIRE & CABLE COMPANY
	 	 	 	 	 
	 	 	 	 	 
	 	 	By:	 	/s/  PETER M. GOTSCH      
 Peter M. Gotsch
 Chairman of the Board

12

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Exhibit 10.14

EXECUTIVE EMPLOYMENT AGREEMENTQuickLinks
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Exhibit 10.16    
    

INVESTOR SECURITIES AGREEMENT  

        This Investor Securities Agreement ("Agreement") is made as of May 22, 1997 by and among Code,
Hennessy & Simmons II, L.P., a Delaware limited partnership ("CHS"), HWC Holding Corporation, a Delaware corporation (the
"Company") and the other investors executing counterparts of this Agreement. 

R E C I T A L S:  

        A.    CHS
and the other investors executing counterparts of this Agreement desire to subscribe for and purchase a combination of Shares and Subordinated Notes of the Company,
and the Company is willing to issue such Shares and Subordinated Notes to each of the foregoing, provided that such parties enter into this Agreement. 

        B.    The
parties hereto desire to provide for certain restrictions on the disposition of Shares, to create certain options with respect to such Shares and to agree to certain
other matters, all upon the terms, conditions and provisions set forth herein. 

A G R E E M E N T S:  

        NOW, THEREFORE, the parties agree as follows: 

ARTICLE I

Definitions; Subscription  

        1.1    Adoption of Recitals.    The parties hereto adopt the foregoing Recitals and agree and affirm that construction
of this Agreement shall be guided thereby. 

        1.2    Definitions.    For purposes hereof: 

        "Act" shall mean the Securities Act of 1933, as amended; 

        "Additional Investors" shall mean the investors other than CHS executing counterparts of this Agreement; 

        "Affiliate" of a Person shall mean any other Person controlling, controlled by or under common control with such Person and any partner of
such Person if such Person is a partnership; 

        "Board" shall mean the duly elected board of directors of the Company; 

        "Delaware Act" shall mean the Delaware General Corporation Law, as amended from time to time; 

        "Executive Securities Agreement" shall mean collectively (i) that certain Chief Executive Securities Agreement of even date
herewith among the Company, CHS and John E. Myers, and (ii) those Executive Securities Agreements hereafter entered into among the Company, CHS and other executives of the Company or its
Affiliates; 

        "Family" shall mean a person's spouse and descendants (whether natural or adopted) (collectively,
"Relatives"), any custodian of a custodianship for and on behalf of a Relative who is a minor and a trustee of a trust solely for the benefit of one or
more of the foregoing; 

        "Fully-Diluted Basis" shall mean the number of Shares which would be outstanding, as of the date of computation, if all convertible
obligations, options and warrants and like rights and instruments, to acquire Shares had been converted or exercised; 

        "Holders" shall mean CHS, the Additional Investors and any other Person to whom Shares are hereafter issued or sold by the Company, CHS or
any other Holder (including a Permitted Transferee) and who join in and agree to be bound by this Agreement as a Holder; 

 

        "Independent Third Party" shall mean any Person who, immediately prior to the contemplated transaction, does not directly or indirectly
beneficially own in excess of five percent (5%) of the Shares of the Company on a Fully-Diluted Basis, who is not an Affiliate of any five percent (5%) owner of such Shares of the Company and who is
not the spouse or descendant (by birth or adoption) of any five percent (5%) owner; 

        "Offer Notice" shall mean a written notice of a proposed Transfer pursuant to Section 2.3; 

        "Open Market Transaction" means any Transfer of Securities in the open market following a Public Sale; 

        "Permitted Transferee" shall mean a Person to whom Shares are Transferred pursuant to and in compliance with the provisions of
Section 2.2; 

        "Person" shall mean any individual, partnership, corporation, limited liability company or partnership, association, joint stock company,
trust, joint venture, unincorporated organization, or the United States of America or any other nation, state or other political subdivision thereof, or any entity exercising executive, legislative,
judicial, regulatory or administrative functions of government; 

        "Public Offering" shall mean a public offering of Shares (or the securities of any successor entity) pursuant to an effective registration
statement under the Act; 

        "Public Sale" shall mean any sale pursuant to a Public Offering or any sale to the public pursuant to Rule 144 (as defined below); 

        "Restricted Holder" shall mean any Holder, Permitted Transferee or other transferee of Shares, except CHS, its limited and general
partners, or any of their respective transferees or successors; 

        "Restricted Securities" shall mean all Securities of the Company or its Subsidiaries (including, without limitation, all Shares of the
Company, all Share Equivalents and all Subordinated Notes), in each case held by a Restricted Holder or his or its Permitted Transferees or other transferees, whether acquired by a Restricted Holder
or his or its Permitted Transferees or other transferees pursuant to this Agreement or any other agreement, option plan or other arrangement with the Company or any Subsidiary, whether on or following
the date of this Agreement, and all securities of the Company issued or issuable with respect to such Shares, Share Equivalents, Subordinated Notes and other securities by way of a split, dividend or
other recapitalization; 

        "Sale of the Company" shall mean the sale (in a single transaction or a series of related transactions) of the Company to any independent
Third Party or group of Independent Third Parties pursuant to which such Independent Third Party or group of Independent Third Parties acquire (i) a majority of the then outstanding Shares of
the Company (whether by merger, consolidation, sale or Transfer of Shares, reorganization, recapitalization or otherwise), or (ii) all or substantially all of the assets of the Company and its
Subsidiaries, determined on a consolidated basis; 

        "SEC" shall mean the Securities and Exchange Commission; 

        "Securities" means all (i) Shares, (ii) Subordinated Notes, and (iii) securities of the Company issued or issuable
with respect to the securities referred to in clauses (i) or (ii) above by way of a stock split, stock dividend or other recapitalization; 

        "Share Equivalents" shall mean any (a) warrants, options or other rights to subscribe for, purchase or otherwise acquire any Shares
or (b) any securities convertible into or exchangeable for Shares; 

2

 

        "Shares" shall mean shares of common stock, $.01 par value, of the Company (now or hereafter issued) and any shares issued in respect of
such shares pursuant to a dividend, stock split, reclassification or like action, or pursuant to an exchange (including a merger). 

        "Subordinated Notes" shall mean the 14% Junior Subordinated Promissory Notes issued from time to time by the Company and any notes issued
in exchange therefor; 

        "Subsidiary" shall mean any Person of which the Company owns securities having a majority of the voting power in electing the board of
directors directly or through one or more subsidiaries, or, in the case of a partnership, limited liability company or other similar entity, securities conveying, directly or indirectly, a majority of
the economic interests in such partnership or entity; and 

        "Transfer" shall mean any transfer, sale, assignment, pledge, encumbrance or other disposition (irrespective of whether any of the
foregoing are effected, with or without consideration, voluntarily or involuntarily, by operation of law or otherwise, or whether inter vivos or upon
death). 

Other
defined terms are contained in the body of this Agreement. 

        1.3    Securities Law Restrictions; Representations, Warranties and Agreements of Holders and Permitted
Transferees.    In addition to the restrictions on the Transfer of Shares which are contained in this Agreement, each Holder represents and warrants to the Company,
and agrees and acknowledges, that: 

        (a)   all
Securities acquired by or for such Holder are and shall be acquired solely for such Holder's or Permitted Transferee's own account, for investment purposes only and
not with a present view toward the distribution thereof or with any present intention of distributing or reselling any such Securities in violation of the Act or any state securities laws and that,
irrespective of any other provisions of this Agreement, any Transfer of such Securities by such Holder or Permitted Transferee shall be made only in compliance with all applicable federal and state
securities laws, including, without limitation, the Act; 

        (b)   Securities
acquired by or for such Holder or Permitted Transferee are not registered under the Act and must be held by such Holder or Permitted Transferee until such
Securities are registered under the Act or an exemption from such registration is available; that the Company shall have no obligation to take any actions that may be necessary to make available any
exemption from registration under the Act; and that the Company shall give to the party responsible for recording Transfers of Securities "stop transfer" directions prohibiting Transfers in violation
of the foregoing provisions of this clause (b); 

        (c)   such
Holder or Permitted Transferee is familiar with Rule 144 adopted by the SEC ("Rule 144") which establishes guidelines governing, among other things,
the resale of "restricted securities" (such as the Securities, which are acquired from the issuer of such securities in a transaction not involving any public offering); 

        (d)   Rule 144
is not presently available for Transfers of the Securities, because, among other things, the Company is not presently required to file the reports
required to be filed by Section 15(d) of the Exchange Act and does not have a class of securities registered pursuant to Section 12 of that statute; and, even if the Company were
required to file reports under the Exchange Act and had filed all reports required to be filed, reliance on Rule 144 to Transfer securities is subject to other restrictions and limitations, as
set forth in Rule 144; 

        (e)   in
connection with any Transfer of the Securities under Rule 144 or pursuant to any other exemption, such Holder or Permitted Transferee may, at the option of the
Company, be required to deliver to the Company an opinion from counsel for such Holder or Permitted Transferee (reasonably acceptable to the Company), and/or receive an opinion from counsel for the
Company, to the effect that all applicable federal and state securities law requirements have been met; 

3

 

        (f)    such
Holder or Permitted Transferee has had an opportunity to ask questions and receive answers concerning the terms and conditions of the offering of the Securities and
has had full access to such other information and materials concerning the Company as Holder or Permitted Transferee has requested; the Company has answered all inquiries that Holder or Permitted
Transferee has made to the Company relating to the Company and the sale of the Securities hereunder; 

        (g)   such
Holder or Permitted Transferee has such knowledge and experience in financial and business matters such that such Holder or Permitted Transferee is capable of
evaluating the merits and risks of investment in the Securities and of making an informed investment decision with respect thereto or has consulted with advisors who possess such knowledge and
experience; 

        (h)   such
Holder or Permitted Transferee is able to bear the economic risk of such Holder or Permitted Transferee's investment in the Securities for an indefinite period of
time because the Securities have not been registered under the Act and, therefore, cannot be sold unless subsequently registered under the Act or unless an exemption from such registration is
available; 

        (i)    the
execution, delivery and performance of this Agreement by such Holder or Permitted Transferee does not and shall not conflict with, violate or cause a breach of any
agreement, contract or instrument to which such Holder or Permitted Transferee is a party or any judgment, order or decree to which such Holder or Permitted Transferee is subject; and 

        (j)    such
Holder or Permitted Transferee shall not grant any proxy or become party to any voting trust or other agreement which is inconsistent with, conflicts with or
violates any provision of this Agreement (and has not granted any such proxy or become a party to any such voting trust or other agreement). 

        (k)   If
such Holder or Permitted Transferee is a corporation, partnership, limited liability company, trust, custodianship, estate or other entity, this Agreement has been
duly executed by a duly authorized person on its behalf and constitutes the legally binding obligation of such Holder or Permitted Transferee, enforceable against such Holder or Permitted Transferee
in accordance with its terms (except to the extent that enforcement may be affected by laws relating to bankruptcy, reorganization, insolvency and creditors' rights generally and by the availability
of injunctive relief, specific performance and other equitable remedies). 

        (l)    If
such Holder or Permitted Transferee is at any time a married individual, the spouse of such Holder or Permitted Transferee, acting with legal capacity to do so, has
executed and delivered to the Company a spousal consent in the form attached hereto (a "Spousal Consent"). 

        1.4    Representations and Warranties of the Company.    The Company represents and warrants to each Holder as
follows: 

        (a)   The
execution and delivery by the Company of this Agreement and the performance by the Company of its obligations hereunder (including, without limitation, the issuance
and delivery of Shares and Subordinated Notes as contemplated hereby) has been duly authorized by all necessary corporate action. 

        (b)   This
Agreement has been duly executed by duly authorized officers of the Company and constitutes the legally valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms (except to the extent that enforcement may be affected by laws relating to bankruptcy, reorganization, insolvency and creditors' rights generally and
by the availability of injunctive relief, specific performance and other equitable remedies). 

        (c)   On
the date of this Agreement, and after giving effect to the transactions contemplated by this Agreement and the Executive Securities Agreements entered into on the
date hereof, (A) the number of all authorized shares of capital stock of the Company is 10,000 Shares of 

4

 

Common
Stock, par value $.01 per share, (B) the number of all shares of capital stock of the Company issued and outstanding shall be 1,836.40 Shares of Common Stock, (C) the face value
of all Subordinated Notes issued and outstanding shall be $8,263,600.00; and (D) there shall be no outstanding options, warrants or other securities convertible or exchangeable for shares of
capital stock of the Company outstanding. All Shares heretofore issued and delivered by the Company to any Holder have been, and all Shares to be issued by the Company to any Holder pursuant to this
Agreement, when issued and delivered, shall be, duly authorized, validly issued, fully paid and non-assessable. 

        1.5    Additional Agreements and Understandings.    As an additional inducement to the Company to issue Shares to each
Holder, each Holder acknowledges and agrees that Shares issued by the Company pursuant to a stock dividend, stock split, reclassification or like action, or pursuant to the exercise of a right granted
by the Company to all holders of Shares to purchase Shares on a proportionate basis, shall be Transferred only, and for all purposes be treated, in the same manner as, and be subject to the same
options with respect to, the Shares which were split or reclassified or with respect to which a stock dividend was paid or rights to purchase Shares on a proportionate basis were granted. In the event
of a merger of or exchange involving the Company where this Agreement does not terminate, partnership units, membership units or shares of common stock (and/or securities convertible into such units
or shares) which are issued in exchange for Shares shall thereafter be deemed to be Shares subject to the terms of this Agreement. 

        1.6    Ownership of the Shares and Subordinated Notes.    

        (a)   As
of the date hereof, each Holder named below hereby subscribes for the number and class of Shares, at a price of One Thousand Dollars ($1,000) per Share, and principal
amount of Subordinated Notes, at face value, set forth opposite the name of each such Holder below: 

	Name
 
	 	Shares
	 	Principal Amount

of

Subordinated

Note

	CHS	 	1,619.20	 	$	7,287,561
	Allan Coleman	 	45.50	 	 	204,500
	Peter Leeb	 	45.50	 	 	204,500
	Steven R. Brown	 	2.80	 	 	12,273
	David O. Hawkins	 	2.80	 	 	12,273
	Richard A. Lobo	 	2.20	 	 	9,819
	Paige Walsh	 	2.20	 	 	9,019
	Tracy A. Hogan	 	2.60	 	 	11,455
	HW Investors	 	13.60	 	 	61,400
	 	TOTAL:	 	1,736.40	 	$	7,813,600
	 	 	
	 	

        (b)   The
purchase price for the Shares and Subordinated Notes described in Section 1.6(a) is being paid by the parties hereto by check or wire transfer of immediately
available funds on the date hereof. 

        (e)   Without
implication that any such consent is necessary, each Stockholder hereby acknowledges and agrees to: 

          (i)  the
sale and issuance by the Company from time to time following the date of this Agreement, to directors, officers or employees of the Company or any of its
Subsidiaries, to lenders to the Company or any Subsidiary in connection with the incurrence, renewal or maintenance of indebtedness, or to CHS or its agents, transaction advisors or Affiliates, of
Shares and Share Equivalents in an amount determined by the Board in its sole discretion. Each Stockholder hereby acknowledges that the purchase price of such securities may be paid 

5

 

in
part by a promissory note made by the purchaser thereof. The purchase price for such Shares or Share Equivalents shall be determined in good faith by vote of a majority of the members of the Board. 

         (ii)  that
the Company (or a Subsidiary) will pay to CHS (or one of its Affiliates) management fees in the amount of $300,000 per year (payable monthly) plus reasonable out
of pocket expenses, such fees and related expenses to be increased from time to time in the event of acquisitions by the Company or any Subsidiary and to take into account inflation and other changed
circumstances. 

        1.7    General Effect of Agreement.    Unless a Transfer of Restricted Securities is made in accordance with the
provisions of this Agreement, such Transfer shall not be valid or have any force or effect. 

        1.8    Joinder.    Any person to whom Restricted Securities are to be Transferred (a
"Transferee") (except pursuant to an effective registration statement filed by the Company with the SEC) shall execute and deliver, as a condition to
such Transfer, all documents deemed reasonably necessary by the Company, in consultation with its counsel, to evidence such party's joinder in, acceptance of, and agreement with, the obligations with
respect to the Restricted Securities contained in this Agreement. Each Transferor of Restricted Securities shall, prior to the Transfer, cause the Transferee to so execute and deliver such documents
(and, if the Transferee is a married individual, cause the Transferee's spouse to execute and deliver to the Company a Spousal Consent). 

        1.9    Other Restrictions.    Notwithstanding anything to the contrary contained herein, a Transfer of Shares shall
not be valid or of any force of effect if such Transfer would result in a violation of any applicable federal or state securities laws. 

        1.10    Special Representations, Warranties and Agreements.    In addition to the representations, warranties,
agreements and acknowledgments set forth in Section 1.3, Allan Coleman and Peter Leeb further represent and warrant to the Company, and agree and acknowledge, that they are entitled to a
$500,000 fee from the Company for the performance of services and they are using such fee to purchase their Securities and that they will be required to pay, and will be responsible for the payment
of, all federal, state and, if applicable, local income taxes on their receipt of such fee and/or Securities. 

ARTICLE II

Voluntary Transfer of Restricted Securities  

        2.1    Restrictions on Transfers of Restricted Securities.    No Restricted Holder shall Transfer any interest in any
Restricted Securities (except pursuant to Section 2.2, Section 4.1 or Section 4.4 below) unless (i) the Restricted Holder has complied with the requirements of
Section 2.3, (ii) all rights provided in Section 2.3 have been waived, and (iii) such Restricted Holder has received (x) a bona fide written offer to purchase such
Restricted Securities, and (y) the prior written approval of the Board (which approval may be withheld for any reason or no reason). Notwithstanding anything to the contrary herein contained,
in no event shall any Restricted Holder be permitted to Transfer any interest in Restricted Securities to a competitor of the Company or any Subsidiary except pursuant to Section 4.1. 

        2.2    Permitted Transfers.    Anything contained in this Agreement to the contrary notwithstanding (except Sections
1.8 and 1.9 and the last sentence of Section 2.1), Restricted Securities may be Transferred without first complying with the provisions of Section 2.3: (i) by a Restricted Holder
or a Permitted Transferee to CHS (it being agreed and understood that CHS shall not be a Restricted Holder as a result of such Transfer of Restricted Securities), (ii) by a Restricted Holder or
Permitted Transferee to any member of such Restricted Holder's or Permitted Transferee's Family, (iii) by a Permitted Transferee to the Restricted Holder who Transferred such Restricted
Securities to such 

6

 

Permitted
Transferee, (iv) to the personal representative of a Restricted Holder or a Permitted Transferee who is deceased or adjudicated incompetent, (v) by the personal representative
of a Restricted Holder or a Permitted Transferee who is deceased or adjudicated incompetent to any member of such Restricted Holder's or Permitted Transferee's Family, or (vi) upon termination
of a trust or custodianship which is a Permitted Transferee of a Restricted Holder, by the trustee of such trust or custodian of such custodianship to the members of the Restricted Holder's or
Permitted Transferee's Family who, in accordance with the provisions of such trust or custodianship, are entitled to receive the Restricted Securities held in trust or custody. No Restricted
Securities may be Transferred pursuant to this Section 2.2 unless, prior to such Transfer, the transferee of such Restricted Securities shall have agreed in writing to be bound by all of the
provisions of this Agreement affecting the Restricted Securities so Transferred (such writing to be in form and substance satisfactory to the Company), and any Restricted Securities Transferred
pursuant to this Section 2.2 shall be subject thereafter to the rights of the Company and the Holders under this Agreement. 

        2.3    First Refusal Right.    If any Restricted Holder (the "Transferring
Holder") desires to Transfer any Restricted Securities, other than pursuant to Section 2.2, and such Transfer has been approved by the Board pursuant to
Section 2.1, such Transferring Holder shall deliver an Offer Notice to the Company and CHS. The Offer Notice shall disclose in detail the identity of the proposed transferee(s) (including,
without limitation, all parties holding interests (directly or indirectly) in such proposed transferee), the proposed number, amount and type of Restricted Securities to be Transferred, and all of the
proposed terms and conditions of the Transfer and any other information reasonably requested by CHS or the Company with respect to such Transfer and the transferee and shall include a complete and
accurate copy of the written offer to purchase Restricted Securities received by the Transferring Holder. The delivery by the Transferring Holder of the Offer Notice shall create the following two
(2) options: 

        (a)   First,
CHS may elect (but shall not be obligated) to purchase all or any portion of the Restricted Securities specified in the Offer Notice at the price and on the terms
specified therein by delivering written notice of such election to the Transferring Holder as soon as practical, but in any event within thirty (30) days following the delivery of the Offer
Notice to the Company and CHS (the "CHS Offer Period"). 

        (b)   Second,
if CHS has not elected to purchase all or any portion of the Restricted Securities within the CHS Offer Period, the Company may elect (but shall not be
obligated) to purchase all or any portion of the Restricted Securities not elected to be purchased by CHS at the price and on the terms specified in the Offer Notice by delivering written notice of
such election to the Transferring Holder as soon as practical, but in any event within sixty (60) days following the delivery of the Offer Notice to the Company and CHS. 

        2.4    Closing of Exercise of Options.    If CHS and/or the Company have elected to purchase all or any portion of the
Restricted Securities offered by the Transferring Holder, the Transfer of such Restricted Securities to the Company and/or CHS, as the case may be, shall be consummated as soon as practical following
the delivery of the election notices, but in any event within ninety (90) days following the delivery of the Offer Notice to the Company and CHS (such ninety-day period being
referred to herein as the "Closing Period"). The Company and/or CHS shall be entitled to transfer and assign any right, title and interest granted to either of them pursuant to this Article II.
The purchasers of any Restricted Securities pursuant to this Article II or Article IV shall be entitled to receive customary representations and warranties as to ownership, title,
authority to sell and the like from the sellers regarding such sale and to receive such other evidence, including applicable inheritance and estate tax waivers, as may be reasonably necessary (in the
purchaser's judgment) to effect the purchase of the Restricted Securities. 

7

 

        2.5    Failure to Deliver Shares.    If any Restricted Holder whose Restricted Securities are to be purchased pursuant
to Section 2.3 fails to deliver them on the scheduled closing date of such purchase, CHS and/or the Company, as the case may be, may elect to deposit the consideration representing the purchase
price of the Restricted Securities with the Company's attorney (or any other third party,
including a bank or a financial institution), as escrowee. In the event of the foregoing election, the Restricted Securities shall be deemed for all purposes (including the right to vote and receive
payment for dividends) to have been Transferred to the purchasers thereof and the Company shall issue new certificates representing the Restricted Securities to the Company and/or CHS, as the case may
be, and the certificates or instruments registered in the name of the Person obligated to sell such Restricted Securities shall be deemed to have been canceled and to represent solely a right to
receive payment of the purchase price, without interest, from the escrow funds. If, prior to the third (3rd) anniversary of the scheduled closing date for the purchase pursuant to Section 2.3,
the proceeds of sale have not been claimed by the transferor whose Restricted Securities were so purchased, the escrow deposit (and any interest earned thereon) shall be returned to the Person
originally depositing the same, and such transferor shall look solely to the purchasers thereof for payment of the purchase price. The escrowee shall not be liable for any action or inaction taken by
it in good faith. 

        2.6    Exercise of Option for Less than All of the Restricted Securities.    If the Board shall have approved the
Transfer pursuant to Section 2.1, and the Company and/or CHS have not collectively elected to purchase all of Restricted Securities being offered, such Transferring Holder may, within sixty
(60) days following the expiration of the Closing Period and subject to the provisions of Section 2.7, Transfer any remaining portion of the Restricted Securities referred to in the
Offer Notice (and not elected to be purchased by CHS or the Company) to the party or parties named therein at a price no less than the price specified in the Offer Notice and on other terms no more
favorable to the transferees than offered to the Company and CHS in the Offer Notice. Any Restricted Securities not Transferred within such sixty (60) day period shall be subject to the
provisions of this Article II with respect to any subsequent Transfer. 

        2.7    Consideration for Transfer.    Notwithstanding anything to the contrary contained herein, in no event shall any
Transfer of Shares by the Restricted Holder be offered to be made under Section 2.3 or made under Section 2.6 for any consideration other than United States dollars payable in full upon
consummation of such Transfer. 

        2.8    Effect of Restricted Securities in Hands of the Transferee.    Restricted Securities which are Transferred
pursuant to this Article 11 (including, without limitation, pursuant to Section 2.2 and 2.6) shall thereafter continue to be subject to all restrictions on Transfer and shall be entitled
to all rights (including the rights under Section 4.1(b), 4.3 and 4.4 of this Agreement) which are contained in this Agreement. Without limiting the generality of the foregoing, the transferee
must comply with the provisions of this Article II if he or it shall propose to Transfer any such Restricted Securities, as if such transferee was a Restricted Holder. 

        2.9    Duration of Article II.    Notwithstanding anything to the contrary contained in this Agreement, the
provisions of this Article 11 shall terminate upon the consummation of a Public Offering. 

ARTICLE III

Limitations on Payment  

        3.1    Payment Limitation.    Notwithstanding anything to the contrary contained in this Agreement, the Company's
obligations to make any payment of immediately available funds on account of the purchase price of Restricted Securities which it has purchased pursuant to any option exercised by the Company in this
Agreement (or which it will purchase pursuant to the options granted in this Agreement) shall be suspended to the extent (x) the making of such payment, together with the making of all other
payments to be made during the fiscal year in which such payment occurs on account of 

8

 

the
Company's purchases of Restricted Securities pursuant to this Agreement, would result in a violation of the Delaware Act or any covenant contained in any loan agreement or other agreement to which
the Company or any Subsidiary is a party, or (y) the Company's Subsidiaries are unable to pay to the Company dividends or other distributions sufficient to permit the Company to pay the
purchase price for such Restricted Securities. If any portion of the Company's obligation to a Transferring Holder has been suspended pursuant to the foregoing for a period in excess of three
(3) years from the date on which such obligation was originally payable, the Transferring Holder, by written notice delivered to the Company, may elect to rescind the sale of all Restricted
Securities, the proceeds of sale of which are represented by unpaid notes made by the Company which are owed to that Transferring Holder. If payments are suspended pursuant to this Section 3.2,
at such time as the Company is able to resume making payments without violation of such law or the covenant, the Company shall first make payment of arrearage owed to Holders, on a proportional (to
the amount of the arrearage) basis, and shall then make regularly scheduled payments. 

ARTICLE IV

Special Rights  

        4.1    Sale of the Company.    

        (a)   If
the holders of a majority of the Shares then outstanding (collectively, "Control Sellers" and each, individually, a
"Control Seller") and the Board approve a Sale of the Company (an "Approved Sale"), each Holder of
Restricted Securities who is not a Control Seller (each, a "Non-Control Seller") shall consent to and raise no objections against the
Approved Sale, and if the Approved Sale is structured as a sale of Securities, each Non-Control Seller shall, if requested by the Control Sellers, sell (or otherwise Transfer) his or its
Restricted Securities (or any portion thereof if requested), on the terms and conditions approved by the Control Sellers. Each
Non-Control Seller shall promptly take all actions deemed necessary or desirable (in the sole judgment of the Control Sellers) in connection with, and to facilitate the consummation of,
the Approved Sale, including the execution of all agreements and instruments as requested by the Control Sellers. Without limiting the foregoing, (i) if the Approved Sale is structured as a
merger, consolidation, joint venture or similar transaction, each Non-Control Seller shall vote in favor of such transaction and waive any dissenters' rights, appraisal rights or similar
rights in connection with such merger or consolidation, and (ii) if the Approved Sale is structured as a sale or exchange of Shares, each Non-Control Seller shall agree to sell or
exchange the Shares held by such Non-Control Seller on the terms and conditions approved by the Control Sellers. The Company shall use reasonable efforts to notify the
Non-Control Sellers in writing not less than thirty (30) days prior to the proposed consummation of an Approved Sale; provided that such Non-Control Seller agrees not to
directly or indirectly (without the prior written consent of the Company), disclose to any other Person (other than to such Non-Control Seller's legal counsel in confidence, as otherwise
necessary to protect such Non-Control Seller's rights under this Agreement or as otherwise required by law) any information related to such potential Sale of the Company. 

        (b)   If
CHS proposes to sell to a purchaser or related group of purchasers such number of Shares as equals or exceeds fifty percent (50%) of the then outstanding Shares
determined on a Fully-Diluted Basis (whether in one transaction or in a series of related transactions) (a "Participation Sale"), each Holder of
Restricted Securities may elect to participate in the Participation Sale by delivering written notice to the Company and CHS within ten (10) days following the receipt by such Holder of notice
of such Participation Sale. Each Holder of Restricted Securities that makes such election shall be entitled to sell, at the same price and on the same terms as CHS, Shares equal to the product of
(i) the quotient determined by dividing the number of Shares owned by such Holder on a Fully-Diluted Basis, by the aggregate number of 

9

 

Shares
outstanding at such time, on a Fully-Diluted Basis, and (i) the number of Shares to be sold by CHS in such transaction. Notwithstanding the foregoing, the provisions of this
paragraph 4.1(b) shall not apply to (x) any sale to any officer, director, lender, agent, transaction advisor, partner or employee of the Company or any of its Subsidiaries, or
(y) any sale or other Transfer to any successor CHS sponsored fund or to any Affiliate or direct or indirect partner of CHS or any other investment fund. 

        (c)   If
the Board, the Control Sellers or CHS enter into any negotiation or transaction for which Rule 546 (or any similar rule then in effect) promulgated by the SEC
may be available with respect to such negotiation or transaction (including a merger, consolidation or other reorganization), the Holders of Restricted Securities, acting as a group, who are required
or elect to sell pursuant to Sections 4.1(a) or 4.1(b) shall, at the request of the Company, appoint a purchaser representative (as such term is defined in Rule 501) reasonably acceptable to
the Company. If such Holders appoint a purchaser representative designated by the Company, the Company shall pay the fees of such purchaser representative, but if such Holders decline to appoint the
purchaser representative designated by the Company, such Holders shall appoint another purchaser representative (reasonably acceptable to the Company), and the such Holders shall be responsible for
the fees of the purchaser representative so appointed. 

        (d)   Each
such participating Holder participating in any transaction pursuant to 4.1(a) or (b) shall bear his or its pro-rata share (based upon the number
of Shares sold on a Fully-Diluted Basis) of the costs of any sale of Securities pursuant to subsection (a) or (b) above to the extent such costs are not otherwise paid by the Company or
the acquiring party; provided, however, that all such participating Holders are treated on an equal basis. Costs incurred by a participating Holder on
his or its own behalf shall not be considered costs of the transaction hereunder. As a condition to the effective exercise of the rights in Sections 4.1(a) and 4.1(b), each such participating Holder
shall join in and agree to be bound by all provisions of the documents pursuant to which the transferee is to acquire securities (provided all participating Holders are treated in reasonably the same
manner). Without limiting the foregoing, any such Holder participating in a transaction pursuant to this Section 4.1 shall be required to make such representations, warranties and covenants,
and grant such indemnification, as may be required by the purchaser or the Securities and which have been made by the Control Sellers or CHS. 

        (e)   The
obligations of the Holders of Restricted Securities with respect to the Approved Sale or the Participation Sale, as the case may be, are subject to the satisfaction
of the following conditions: (i) upon the consummation of the Approved Sale or the Participation Sale, as the case may be, all of such participating Holders shall receive substantially the same
form and amount of consideration per Share, or if any such participating Holders are given an option as to the form and amount of consideration to be received, all such participating Holders shall be
given substantially the same option; and (ii) all such participating Holders of then currently exercisable Share Equivalents shall be given an opportunity to either (A) exercise such
rights prior to the consummation of the Approved Sale or the Participation Sale, as the case may be, and participate in such sale as holders of Shares or (B) upon the consummation of the
Approved Sale or the Participation Sale, as the case may be, receive in exchange for such rights consideration equal to the amount determined by multiplying (1) the same amount of consideration
per Share received by the holders of Shares in connection with the Approved Sale or the Participation Sale, as the case may be, less the exercise or conversion price per share of such Share Equivalent
by (2) the number of Shares represented by such Share Equivalent. 

        4.2    Initial Public Offering.    If the Control Sellers and the Board approve an initial Public Offering of Shares
(or securities of any successor), each Holder of Restricted Securities shall take all actions reasonably necessary or desirable in connection with the consummation of the Public Offering as requested
by the Company (including, without limitation, the execution of customary lock-up, 

10

 

underwriting
or other agreements). If such Public Offering is an underwritten offering and the managing underwriters advise the Company that in their opinion the structure of the Company would
adversely affect the marketability of the offering, each Holder of Restricted Securities shall consent to and vote for a recapitalization, reorganization and/or exchange of the Company into an entity
with authorized securities that the managing underwriters, the Board and the holders of a majority of Shares find acceptable, and each such Holder shall take all actions reasonably necessary or
desirable in connection with the consummation of the recapitalization, reorganization and/or exchange as requested by the Board. 

        4.3    Limited Preemptive Rights.    

        (a)   If
the Company authorizes the issuance and sale of any Shares or Share Equivalents (other than as a dividend on outstanding Shares and except as provided below) (a
"Preemptive Event"), the Company shall first offer to sell to each Holder of Restricted Securities a portion of such Shares equal to the percentage
determined by dividing (1) the number of Shares held by such Holder immediately prior to the proposed issuance of such securities, on a Fully-Diluted Basis, by (2) the aggregate number
of Shares outstanding at such time, on a Fully-Diluted Basis; provided that if CHS (or any of its partners, employees, Affiliates, transferees or designees) purchases other securities (including,
without limitation, subordinated indebtedness of the Company or any of its Subsidiaries) in connection with such issuance or sale, then each such Holder, if any, exercising preemptive rights pursuant
to this Section 4.3, shall, as a condition to such exercise, also be required to purchase the same proportionate strip of securities that CHS (or such partners, employees, Affiliates,
transferees or designees) purchases. The purchase price for all stock and securities offered to such Holders of Shares shall be payable by cashier's check or wire transfer of immediately available
funds unless other payment terms are designated in writing. Notwithstanding the foregoing, the preemptive rights set forth in this Section 4.3 shall not apply to the issuance of Shares, Share
Equivalents or other securities: (A) to any Person in connection with (or to facilitate) the acquisition by the Company or any of its Subsidiaries of another Person's business, stock or assets
(whether by acquisition of stock or assets, or by merger, exchange, consolidation or other similar transaction) or the formation of a joint venture, (B) pursuant to a Public Offering,
(C) to officers, employees, directors, consultants, transaction advisors or agents of the Company or any of its Subsidiaries (whether employed or engaged now or in the future), or (D) to
the Company's or any Subsidiary's lenders or any other Person in connection with the incurrence, renewal or maintenance of indebtedness, or pursuant to any loan document to satisfy conversion, option
or warrant rights heretofore or hereafter issued by the Company or any of its Subsidiaries, or anti-dilution rights applicable to any of the foregoing. Notwithstanding anything in this
Section 4.3 to the contrary, if preemptive rights are exercised pursuant to this Section 4.3 and pursuant to the preemptive rights granted under the Executive Securities Agreements for
an aggregate number of Shares and Share Equivalents which is greater than 100% of the Shares or Share Equivalents to be issued and sold by the Company, then the number of Shares that each such Holder
shall be entitled to purchase pursuant to this Section 4.3 shall be reduced, on a pro rata basis among all such Holders exercising preemptive rights under this Section 4.3, to the extent
necessary such that the number of Shares and Share Equivalents purchased pursuant to the preemptive rights exercised under this Agreement and under the Executive Securities Agreements equal the number
of Shares and Share Equivalents to be issued and sold by the Company. 

        (b)   Each
such Holder shall exercise his, her or its preemptive rights hereunder (in writing) within ten (10) days following the receipt of written notice from the
Company describing in reasonable detail the purchase price and payment terms for the securities to be purchased and such Holder's percentage allotment. Each Holder exercising preemptive rights
hereunder shall execute all documentation, and take all actions, as may be reasonably requested by the Company in connection therewith. 

11

 

        (c)   Upon
the expiration of the offering period described above, the Company shall be entitled to sell such Shares or Share Equivalents that Holders have not elected to
purchase during the one hundred eighty (180) day period following such expiration, on terms and conditions no more favorable to the purchasers thereof than those offered to each Holder. Any
Shares not offered or sold by the Company following such one hundred eighty (180) day period shall be reoffered to each Holder pursuant to the terms of this Section 4.3. 

        (d)   The
rights of each Holder under Section 4.1(b) and this Section 4.3 shall terminate upon a Sale of the Company or upon the consummation of a Public
Offering. 

        4.4    Piggyback Registration.    

        (a)   For
purposes of this Section 4.4, and without implication that the contrary would otherwise be true, the term "Company" shall include any successor to the Company
and the term "Shares" shall include any securities of any such successor. If, at any time or times, the Company determines to file with the SEC a registration statement covering any Shares to be
issued or sold by the Company or CHS, other than Shares or other securities of the Company which are issuable in an offering (a) to directors, officers or employees of the Company or its
Subsidiaries pursuant to an employee stock option, bonus or other employee benefit plan, (b) in connection with the acquisition of another company's business by the Company or any of its
Subsidiaries (whether by acquisition of stock or assets, merger, consolidation or other similar transaction) or the formation of a joint venture, (c) pursuant to a registration statement on any
form which limits the amount of securities which may be registered by the issuer and/or selling security holders or is not available for registering the Shares held by the Holders for sale to the
public if and to the extent that such inclusion would make the use of such form unavailable, or (d) pursuant to which the individual, partnership, corporation or trust selling such Shares or
other Securities has the contractual right to exclude, and does exclude, "piggyback" registrations as to all Holders (a "Piggyback Event"), the Company
shall (at least fifteen (15) days prior to the filing of such proposed registration statement) notify each Restricted Holder in writing of the proposed registration statement, such notification
to describe in detail the proposed registration (including those jurisdictions where registration is required under federal and/or state securities laws). If one or more of such Restricted Holders
requests the Company in writing, within ten (10) days of the receipt of such notification from the Company, to include in such registration statement any of such Holder's Shares, then, subject
to the remaining provisions hereof, the Company will use reasonable-efforts to include those Shares in the registration statement and to have the registration statement declared effective. Each such
request by a Restricted Holder shall specify the number of Shares intended to be offered and sold by each such Holder, shall express each such Holder's present intent to offer such Shares for
distribution, shall (subject to the provisions of Section 4.4(c)), if the Company or CHS has not arranged for a plan of distribution or other marketing arrangements for such distribution,
describe the nature or method of the proposed offer and sale thereof and shall contain the undertaking of each such Holder to provide all such information and materials and take all such action as may
be requested in order to permit the Company to comply with all applicable requirements of the SEC and to obtain acceleration of the effective date of such registration statement. The Company, at its
sole option, may elect not to proceed with the registration statement which is the subject of such notice. The obligations of the Company under this Section 4.4(a) are subject to limitations,
conditions and qualifications set forth in Section 4.4(b). If a Holder decides not to (or is precluded from including) all of its Shares in any registration statement thereafter filed by the
Company, such holder will nevertheless continue to have the right under this Section 4.4 to include Shares in a future Piggyback Event, all upon the terms and subject to the conditions as set
forth in this Agreement. 

12

 

        (b)   The
obligation of the Company to use its reasonable efforts to cause Shares to be registered under the Act pursuant to Section 4.4(a) above is subject to each of
the following limitations, conditions and qualifications: 

          (i)  the
Company shall be entitled to reduce the number of Shares of any such Restricted Holder to be included in such registration if the managing underwriter(s) of a
Proposed Public Offering of the Company's securities advise the Company that, in its opinion, (or, if the offering is not underwritten,
upon the Company's reasonable determination that) inclusion of all of such Holder's requested Shares would adversely affect the Public Offering of securities being sold by the Company; 

         (ii)  the
Company shall use reasonable efforts to cause the registration statement to remain current (including the filing of necessary supplements or
post-effective amendments) during the period commencing on the initial effective date of such registration statement and ending on the date on which such registration statement shall have
remained effective for ninety (90) days; 

        (iii)  provided
that the Company or CHS has not arranged for a plan of distribution and other marketing arrangements for such registration, it shall be a condition of the
right of a Restricted Holder to participate that it shall have arranged for a plan of distribution of its Shares which are to be registered and made all pertinent marketing arrangements for such
Shares. Any such plan and arrangements shall contemplate (i) a firm underwriting commitment, (ii) sales through a single broker-dealer (named in the registration statement as agent for
such Holder pursuant to an agreement containing, without limitation, the agreement of such Holder not to offer or sell its Shares otherwise than through such broker-dealer unless and until such
broker-dealer's authorization to sell the Shares has been terminated), or (iii) such other plan and arrangements as shall be approved by the Company. Notwithstanding the preceding sentence, if
any securities to be sold by the Company or CHS pursuant to such registration statement are to be sold on a run commitment basis through underwriters, those Restricted Holders desiring to sell their
Shares in the offering shall, at the request of the Company or CHS, (i) sell their Shares on such basis through such underwriters and (ii) complete and execute all questionnaires, powers
of attorney, indemnities, underwriting agreements and other documents consistent with the terms of this Agreement and required under the terms of such underwriting arrangements; 

        (iv)  whenever
the Company is required by the provisions of this Agreement to use reasonable efforts to register Shares under the Act, the Company will furnish to each
participating Holder such number of copies of any prospectus (including any preliminary or summary prospectus) as such Holder may reasonably request in order to effect the offering and sale of the
Shares to be offered and sold by such Holder, but only while the Company is required under the provisions hereof to cause the registration statement to remain current; 

         (v)  the
Company's obligations to use reasonable efforts to effect registration of Shares for Restricted Holders shall include such qualification under applicable state
securities laws as may be necessary to enable the Holders on whose behalf such registration is to be effected to offer and sell the Shares which are the subject matter of their requests; provided,
however, that the Company shall not be obligated to qualify as a foreign corporation to do business under the laws of any jurisdiction in which it is not then qualified or to file any general consent
to service of process; 

        (vi)  all
expenses incurred in connection with any registration or qualification pursuant to Section 4.4(a) above, including, without limitation, all SEC registration
fees, state securities filing fees, printing expenses (excluding the printing of any agreements, memoranda or other documents pertaining solely to the sale of Shares by Holders) and fees and
disbursements of 

13

 

experts
used by the Company in connection with such registration, shall, subject to requirements of any applicable regulatory agency, be borne by the Company. Each participating Holder (including CHS)
shall bear the fees and disbursements of its own legal counsel, underwriting or brokerage discounts and commissions, and transfer taxes, on the sale of its Shares; 

       (vii)  the
Company may require, as a condition to fulfilling its obligations under the registration provisions of Section 4.4(a) of this Agreement, receipt of executed
customary indemnification agreements in form reasonably satisfactory to the Company from the Restricted Holders whose Shares are to be registered, and the Restricted Holders may require, as a
condition to fulfilling their obligations under the registration provisions of Section 4.4(a) of this Agreement, receipt of executed customary indemnification agreements from the Company in
form reasonably satisfactory to the Holders whose Shares are to be registered; 

      (viii)  the
Company shall notify each participating Holder at any time when a prospectus relating to such Shares is required to be delivered under the Act, of the happening
of any event which causes such prospectus as then in effect to contain an untrue statement of a material fact or to omit to state a material fact required to be stated therein or necessary to make the
statements therein not misleading, and, if necessary in the reasonable judgment of counsel for the Company, the Company will promptly prepare a supplement or amendment to such prospectus so that as
thereafter delivered to the purchasers of such Shares, such prospectus will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements
therein not misleading; 

        (ix)  each
participating Holder, upon receipt of any notice of the happening of any event of the kind described in Section 4.4(b)(viii) hereof, will immediately
discontinue disposition of the Shares until such Holder's receipt of the copies of the supplemented or amended prospectus contemplated by Section 4.4(b)(viii) hereof or until such Holder
is advised in writing by the Company that the use of the prospectus may be resumed, and, if so directed by the Company, such Holder will, or will request the managing underwriter or underwriters (if
any) to, deliver to the Company all copies, other than permanent file copies then in such holder's possession, of the prospectus covering such Shares current at the time of receipt of such notice; 

         (x)  each
such participating Holder agrees (i) to notify the Company as promptly as practicable of any inaccuracy or change in information previously furnished by such
Holder to the Company or of the occurrence of any event, in either case, as a result of which any prospectus relating to such registration contains or would contain an untrue statement of a material
fact regarding such Holder or omits or would omit to state any material fact regarding such Holder required to be stated therein or necessary to make the statements therein not misleading and
(ii) promptly to furnish to the Company any
additional information required to correct and update any previously furnished information or required so that such prospectus shall not contain, with respect to such Holder, an untrue statement of a
material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in light of the circumstances then existing; and 

        (xi)  for
purposes of this Agreement, the phrases "reasonable efforts" and "reasonable efforts to cause," when used with reference to efforts to be made by a party hereto or
any of its Affiliates shall not require such party or any of its Affiliates to pay or transfer any money, property or other thing of value, shall require such party and its Affiliates to act with all
reasonable promptness and dispatch with respect thereto and shall require the other party and its Affiliates to act with all reasonable promptness and dispatch and to cooperate in all material
respects with the first party's efforts in connection therewith. 

14

 

        (c)   Transfer of Shares in Open Market Transactions.    This Section 4.4(c) shall apply to any proposed
Transfer of Shares by any Restricted Holder in an Open Market Transaction during all such times as CHS owns in the aggregate greater than thirty percent (30%) of the Shares. During each calendar
quarter during which sales of Shares are permitted to be made in accordance with agreements ("Standstill Agreements") with the underwriters engaged in
connection with a Public Sale, and during each calendar quarter following the termination of the Standstill Agreements, any such Restricted Holder may sell such number of Shares as equals its pro rata
share of one percent (1.0%) of the then outstanding Shares (or such lesser percentage or number as may be permitted by the Standstill Agreements). Fifteen (15) business days prior to the
beginning of each calendar quarter during which sales of Shares are permitted under the Standstill Agreements, and fifteen (15) days prior to each calendar quarter after the termination of the
Standstill Agreements, such Restricted Holder shall deliver a written notice to the Company setting forth the number of Shares that such Restricted Holder desires to sell (up to such Restricted
Holder's pro rata share of the aggregate quarterly maximum specified above) in Open Market Transactions during the succeeding quarter. If such Restricted Holder does not elect to sell his pro rata
share, the Company may allocate the right to sell such unused pro rata share to any Stockholder of the Company. Within three (3) business days following the beginning of each applicable
quarter, the Company shall deliver a written notice to such Restricted Holder setting forth the amount of Shares permitted to be sold (as determined in accordance with this Section 4.4(c)) by
such Restricted Holder during such applicable calendar quarter in Open Market Transactions. The Company may, in its discretion, from time to time increase the aggregate amount of Shares which may be
sold in any calendar quarter in Open Market Transactions. Any Shares sold in an Open Market Transaction shall cease to be bound by the terms and provisions of this Agreement. 

ARTICLE V

Miscellaneous  

        5.1    Legend on Certificates.    All certificates evidencing Shares which are subject to this Agreement shall bear
the following legend: . 

"THE
SHARES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT OR AN EXEMPTION FROM REGISTRATION THEREUNDER. THE SHARES REPRESENTED HEREBY ARE ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER, CERTAIN REPURCHASE OPTIONS AND CERTAIN
OTHER AGREEMENTS SET FORTH IN AN INVESTORS SECURITIES AGREEMENT AMONG HWC HOLDING CORPORATION (THE "COMPANY"), ONE OR MORE HOLDERS OF SECURITIES OF THE COMPANY AND THE ORIGINAL HOLDER HEREOF DATED AS
OF MAY 22, 1997, AND THE COMPANY RESERVES THE RIGHT TO REFUSE THE TRANSFER OF THIS SECURITY UNTIL THE CONDITIONS THEREIN HAVE BEEN FULFILLED WITH RESPECT TO SUCH TRANSFER. A COPY OF SUCH AGREEMENT MAY
BE OBTAINED BY THE HOLDER HEREOF AT THE COMPANY'S PRINCIPAL PLACE OF BUSINESS WITHOUT CHARGE." 

Upon
termination of this Agreement, certificates for Shares may be surrendered to the Company in exchange for new certificates without the foregoing legend. 

        5.2    Termination of Agreement.    This Agreement shall be terminated: (a) by the Company with the approval of
a majority of the members of the Board and with the written consent of Holders then owning in the aggregate greater than seventy percent (70%) of all of the then outstanding Shares and 

15

 

(b) upon
a Sale of the Company (other than as a result of a sale in a Public Offering of Shares of the Company); provided, however, that the
representations and warranties of the parties hereto contained in this Agreement shall survive the closing of the transaction contemplated by this Agreement and none shall merge into any instrument of
conveyance, regardless of any investigation or lack of investigation by the parties hereto, and all such representations and warranties shall survive termination of this Agreement. 

        5.3    Amendment of Agreement.    This Agreement may be amended by the Company with the written consent of Holders
then owning in the aggregate greater than seventy percent (70%) of all of the then outstanding Shares, provided that in no event shall any such amendment materially and adversely affect the rights of
any one Holder without the prior written consent of such Holder unless such amendment materially and adversely affects the rights of all Holders. 

        5.4    Termination of Status as Holder.    From and after the date that a Holder ceases to own any Shares, he shall no
longer be deemed to be a Holder for purposes of this Agreement and all rights he may have
hereunder (including, without limitation, the right to exercise any option herein granted) shall terminate. 

        5.5    Notices.    Any notice provided for in this Agreement must be in writing and must be either personally
delivered, mailed by first class mail (postage prepaid and return receipt requested) or sent by confirmed facsimile (provided, however, that notices delivered by facsimile shall only be effective if
such notice is also delivered by hand, or mailed by first class mail (postage prepaid and return receipt requested) or sent by reputable overnight courier (charges prepaid), on or before two
(2) business days after its delivery by facsimile) or by reputable overnight courier service (charges prepaid) to the recipient at the address indicated below: 

The
Company: 

HWC
Holding Corporation

c/o Code, Hennessy & Simmons II, L. P.

10 South Wacker Drive

Suite 3175

Chicago, Illinois 60606

Attention: Peter Gotsch and Richard Lobo

Facsimile: (312) 876-3854 

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

Altheimer
& Gray

10 South Wacker Drive

Suite 4000

Chicago, IL 60606

Attn: S. Michael Peck

Facsimile: (312) 715-4800 

16

 

CHS:

Code,
Hennessy & Simmons II, L.P.

10 South Wacker Drive

Suite 3175

Chicago, Illinois 60606

Attention: Peter Gotsch and Richard Lobo

Facsimile: (312) 876-3854 

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

Altheimer
& Gray

10 South Wacker Drive Suite 4000

Chicago, IL 60606

Attn: S. Michael Peck

Facsimile: (312) 715-4800 

If
to any other Holder, at the last known address of such Holder as disclosed by the books and records of the Company, 

and/or
to such other persons and/or at such other addresses as may be designated by written notice served in accordance with the provisions hereof. Any notice under this Agreement shall be deemed to
have been given, (a) if delivered in person, by facsimile or overnight courier, one (1) business day following delivery to recipient, facsimile transmission or delivery to the courier
(as the case may be), or (b) if mailed, three (3) days following deposit in the U.S. mail. 

        5.6    Construction.    The use of the singular or plural or masculine or neuter gender shall not be given an
exclusionary meaning and, where applicable, shall be intended to include the appropriate number or gender, as the case may be. 

        5.7    Counterparts.    This Agreement may be executed in counterparts, each of which shall be deemed to be an
original and all of which, when taken together, shall constitute one instrument. 

        5.8    Descriptive Headings.    Title headings are for reference purposes only and shall have no interpretative
effect. 

        5.9    Entire Agreement.    This Agreement constitutes the entire agreement between the parties with respect to the
subject matter hereof. 

        5.10    Binding Effect.    This Agreement shall be binding upon and inure to the benefit of the parties hereto, their
heirs, representatives, successors and permitted assigns including, without limitation, Permitted Transferees to the extent provided for in this Agreement. 

        5.11    Applicable Law.    This Agreement shall be governed and controlled as to validity, enforcement,
interpretation, construction, effect and in all other respects by the internal laws of the State of Illinois applicable to contracts made in that State. 

        5.12    Consent to Jurisdiction.    CHS, the Company and the Additional Investors irrevocably consent and submit to
the exclusive jurisdiction of any local, state or federal court within the County of Cook in the State of Illinois for enforcement by the Company or CHS of this Agreement. Additional Investors
irrevocably waive any objection they may have to venue in the defense of an inconvenient forum to the maintenance of such actions or proceedings to enforce this Agreement. 

        5.13    Severability.    The invalidity of any provision of this Agreement or portion of a provision shall not affect
the validity of any other provision of this Agreement or the remaining portion of the applicable provision. 

17

 

        5.14    Headings.    The headings contained in this Agreement are for convenience of reference only and shall not
affect the meaning or interpretation of this Agreement. 

        5.15    No Strict Construction.    The parties hereto jointly participated in the negotiation and drafting of this
Agreement. The language used in this Agreement shall be deemed to be the language chosen by the parties hereto to express their collective mutual intent. This Agreement shall be construed as if
drafted jointly by the parties hereto, and no rule of strict construction shall be applied against any person. 

        IN
WITNESS WHEREOF, the parties have executed this Investor Securities Agreement as of the date first above written. 

	 	 	HWC HOLDING CORPORATION
	

 	
 	

By:	

/s/ Peter M. Gotsch

	 	 	 	Its:	Vice President

	

 	
 	

CODE, HENNESSY & SIMMONS II, L.P.
	

 	
 	

By:	

CHS MANAGEMENT II, L.P.
	 	 	Its:	General Partner
	

 	
 	

By:	

Code, Hennessy & Simmons, Inc.
	 	 	Its:	General Partner
	

 	
 	

By:	

/s/ Peter M. Gotsch

	 	 	Its:	Vice President

	

 	
 	

/s/ Allan Coleman
 Allan Coleman
	

 	
 	

/s/ Peter Leeb
 Peter Leeb
	

 	
 	

/s/ Steven R. Brown
 Steven R. Brown
	

 	
 	

/s/ David O. Hawkins
 David O. Hawkins
	 	 	 	 	 

18

 

	

 	
 	

/s/ Richard A. Lobo
 Richard A. Lobo
	

 	
 	

/s/ Paige Walsh
 Paige Walsh
	

 	
 	

/s/ Tracy A. Hogan
 Tracy A. Hogan
	

 	
 	

HW INVESTORS
	

 	
 	

By:	

/s/ S. Michael Peck

	 	 	Its:	Authorized Agent

The
following parties have executed joinders entering into this Investor Security Agreement: Katherine Blankenship; Heller Financial, Inc.; Marcus George; Michael Keesey; Edward Lhee. 

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SPOUSAL CONSENT  

        I acknowledge that I have read the foregoing Agreement and that I know its contents. I am aware that by its provisions, my spouse agrees, among other things, to a
right of first refusal, to the granting of rights to purchase and to the imposition of certain restrictions on the transfer of the shares of the Company, including my community interest therein (if
any), which rights and restrictions may survive my spouse's death. I hereby consent to such rights and restrictions, approve of the provisions of the Agreement, and agree that I will bequeath any
interest which I may have in said shares or any of them, including my community interest, if any, or permit any such interest to be purchased, in a manner consistent with the provisions of this
Agreement. I direct that any residuary clause in my will shall not be deemed to apply to my community interest (if any) in such shares except to the extent consistent with the provisions of this
Agreement. 

        I
further agree that in the event of a dissolution of the marriage between myself and my spouse, in connection with which I secure or am awarded shares of the common stock of the
Company, or any interest therein through property settlement agreement or otherwise, I shall receive and hold said shares subject to all the provisions and restrictions contained in the foregoing
Agreement, including any option of the Company or CHS to purchase such shares or interest from me. 

        I
also acknowledge that I have been advised to obtain independent counsel to represent my interests with respect to this Agreement but that I have declined to do so and hereby expressly
waive my right to such independent counsel. 

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QuickLinks

Exhibit 10.16

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