Document:

Exhibit 10.2

 

INTERCREDITOR AGREEMENT

 

This INTERCREDITOR AGREEMENT, dated as of this 21st
day of August, 2003 (this “Agreement”), is among:  (1) SHERIDAN ACQUISITION CORP. (“SAC”
or the “Company”)
and THE SHERIDAN GROUP, INC. (“TSG,” or, after consummation of the merger
described below, the “Company”); (2) THE SUBSIDIARIES OF TSG
IDENTIFIED ON THE SIGNATURE PAGES HERETO (together with other subsidiaries of
TSG parties hereto from time to time, the “Guarantors”); (3) THE BANK OF NEW YORK, as
trustee for the Noteholders pursuant to the Indenture referred to below and as
collateral agent for the Noteholders pursuant to the Collateral Agreements
referred to in the Indenture (together with its successors and assigns in such
capacities, the “Trustee”); and (4) FLEET NATIONAL BANK (together with it
successors and assigns and all replacement lenders contemplated below, the “Lender”).

 

Background

 

A.                 TSG, as survivor
to a merger with SAC, is party to a certain Indenture, dated as of the date
hereof (as the same may be amended, restated, modified, supplemented, and/or
replaced from time to time consistent with the provisions hereof, the “Indenture”)
with the Trustee.  Pursuant to the
Indenture, the Company issued certain promissory notes (together with any other
promissory notes issued thereunder from time to time, the “Indenture Notes”) in an
original aggregate principal amount equal to $105,000,000.  The Guarantors have guaranteed the
obligations of the Company in respect of the Indenture, the Indenture Notes and
related agreements and instruments.

 

B.                   TSG, as
survivor to the aforementioned merger with SAC, is also party to a certain
Credit Agreement, dated as of the date hereof (as the same may be amended,
restated, modified, supplemented, and/or replaced from time to time consistent
with the provisions hereof, the “Credit Agreement”) with the Lender.  Pursuant to the Credit Agreement, the Lender
has agreed to extend credit in an original aggregate principal amount not to
exceed $18,000,000.  The Guarantors have
guaranteed the obligations of the Company in respect of the Credit Agreement,
the letters of credit issued thereunder, the related notes and other related
agreements and instruments.

 

C.                   In connection
with the Indenture, the Credit Agreement, the related guarantees and notes and
certain other agreements and instruments entered into in connection therewith,
the Company and Guarantors have granted a lien on substantially all of their
assets to secure their obligations thereunder.

 

D.                  The Trustee and
the Lender wish to clarify their relative rights with respect to the collateral
and certain related matters as set forth below.

 

 

NOW THEREFORE, intending
to be legally bound the parties hereto agree as follows.

 

1.                   Definitions.
 The following terms shall be used
in this Agreement as defined below.

 

1.1                                 “Bank
Documents” means, collectively, the Credit Agreement, letters of
credit, notes, collateral documents, guarantees, interest rate protection
agreements and other agreements and instruments entered into under or in connection
with the Credit Agreement from time to time, in each case as the same may be
amended, restated, modified, supplemented, and/or replaced from time to time
consistent with the provisions hereof.

 

1.2                                 “Bank
Excluded Assets” means assets, if any, that are expressly excluded
from collateral under the terms of the Bank Documents.

 

1.3                                 “Bank Junior
Lien” means the Lien in favor of the Lender in respect of the Note
Priority Collateral.

 

1.4                                 “Bank Maximum
Amount” means, with respect to Bank Obligations, up to the Bank
Permitted Principal Amount in principal amount outstanding, plus all related
interest, fees, costs, indemnities and expenses.

 

1.5                                 “Bank
Obligations” means all obligations of the Obligors under the Bank
Documents including, without limitation, principal of and interest on the notes
(including, without limitation, interest accruing at the then applicable rate
provided in the Bank Documents after the maturity date of the notes and
interest accruing at the then applicable rate provided in the Bank Documents
after the filing of any petition in bankruptcy, or the commencement of any
Insolvency Proceeding relating to the Obligors whether or not a claim for
post-filing or post-petition interest is allowed in such proceeding),
reimbursement obligations in resect of letters of credit, obligations under
interest rate protection agreements, all indemnities, costs and expenses,
whether direct or indirect, absolute or contingent, due or to become due, or
now existing or hereafter incurred under or pursuant to the Bank Documents.

 

1.6                                 “Bank
Permitted Principal Amount” shall have the meaning ascribed to such
term in Section 11.2.

 

1.7                                 “Bank
Priority Collateral” means (a) all assets constituting personal
property (whether tangible or intangible), now owned or hereafter acquired by
the Company or any Guarantor or in which the Company or any Guarantor now or in
the future has an interest and including, without limitation, all equity
interests in subsidiaries and proceeds thereof but excluding the Note Priority
Collateral and (b) the equity of the Company and proceeds thereof, provided,
however, Bank Priority Collateral shall not include Bank Excluded Assets.

 

2

 

1.8                                 “Bankruptcy
Code” means The Bankruptcy Code of 1978, as amended from time to
time (11 U.S.C. Sections 101 et seq.), and any replacement or successor act
that has a substantially similar purpose.

 

1.9                                 “Bank Senior
Lien” means the Lien in favor of the Lender in respect of the Bank
Priority Collateral.

 

1.10                           “Collateral
Enforcement Action” means the exercise of any rights and remedies
available to the Lender or the Trustee, as applicable, pursuant to any
agreement or under applicable law to enforce its rights and remedies relative
to any collateral security provided for in the Bank Documents or Note
Documents, as applicable, including, without limitation, (a) the commencement
of any action, suit or other proceeding against any Obligors to foreclose
(whether in strict foreclosure or otherwise), attach, seize, sell or otherwise
to realize upon any of the security, (b) the exercise of any rights of set-off,
(c) any notification by a secured party to an account debtor with respect to
any account constituting collateral, which notification would direct such
account debtor to remit payments with respect to such account to the notifying
party and (d) the collection, possession, removal or sale of any collateral or
the exercise of any other self-help remedy.

 

1.11                           “Lien”
means any mortgage, security interest, pledge, hypothecation, lien or similar
encumbrance.

 

1.12                           “Liquidation”
means the legal termination, winding up or dissolution of an Obligor and/or the
liquidation of all or substantially all of the assets of an Obligor other than
a legal termination, winding up, dissolution or liquidation of a Guarantor in
connection with a merger or disposition permitted by the terms of the Note
Documents and the Bank Documents.

 

1.13                           “Note
Documents” means, collectively, the Indenture, the Indenture Notes,
collateral documents, guarantees, and other agreements and instruments entered
into under or in connection with the Indenture from time to time, in each case
as the same may be amended, restated, modified, supplemented, and/or replaced
from time to time consistent with the provisions hereof.

 

1.14                           “Note
Excluded Assets” means assets that are expressly excluded from
collateral under the terms of the Note Documents.

 

1.15                           “Noteholders”
means the holders of the Notes from time to time.

 

1.16                           “Note Junior
Lien” means the Lien in favor of the Trustee in respect of the Bank
Priority Collateral.

 

3

 

1.17                           “Note Maximum
Amount” means, with respect to the Note Obligations, up to the Note
Permitted Principal Amount in principal amount outstanding, plus all related
interest, fees, costs, indemnities and expenses.

 

1.18                           “Note
Obligations” means all obligations of the Obligors under the Note
Documents including, without limitation, principal of and interest on the Notes
(including, without limitation, interest accruing at the then applicable rate
provided in the Note Documents after the maturity date of the Notes and
interest accruing at the then applicable rate provided in the Note Documents
after the filing of any petition in bankruptcy, or the commencement of any
Insolvency Proceeding relating to the Obligors whether or not a claim for
post-filing or post-petition interest is allowed in such proceeding), all
indemnities, costs and expenses, whether direct or indirect, absolute or
contingent, due or to become due, or now existing or hereafter incurred under
or pursuant to the Note Documents.

 

1.19                           “Note
Permitted Principal Amount” shall have the meaning ascribed to such
term in Section 11.6.

 

1.20                           “Note
Priority Collateral” means all real property, equipment and
fixtures, now owned or hereafter acquired by the Company or any Guarantor or in
which the Company or any Guarantor now or in the future has an interest,
together with all proceeds thereof resulting from a sale or other disposition
thereof, provided, however, Note Priority Collateral shall not include
Note Excluded Assets.

 

1.21                           “Note Senior
Lien” means the Lien in favor of the Trustee in respect of the Note
Priority Collateral.

 

1.22                           “Insolvency
Proceeding” means any receivership, conservatorship, general meeting
of creditors, insolvency or bankruptcy proceeding, assignment for the benefit
of creditors, or any proceeding or action by or against any of the Obligors for
any relief under the Bankruptcy Code or any other insolvency law or other laws
relating to the relief of debtors, readjustment of indebtedness,
reorganizations, dissolution, liquidation, compositions or extensions, or the
appointment of any receiver, intervenor or conservator of, or trustee, or
similar officer for, any of the Obligors or any substantial part of its
properties or assets.

 

1.23                           “Obligors”
means, collectively, the Company and the Guarantors.

 

2.                   Priority
of Security Interests and Obligations.

 

2.1                                 Pari Passu Obligations.  The payment obligations of
the Obligors under the Note Documents and Bank Documents are all senior secured
obligations of the Obligors, ranking equally in priority of payment except
certain payments in respect of or arising out of Liens as provided herein.

 

4

 

2.2                                 Priority of Security Interest in
Bank Priority Collateral. 
The Bank Senior Lien shall at all times be and remain superior and prior
in right of payment and enforcement to the Note Junior Lien and the Note Junior
Lien shall at all times be junior and subordinate to the Bank Senior Lien with
respect to the Bank Priority Collateral, in each case up to, but not in excess
of, the Bank Maximum Amount.

 

2.3                                 Priority of Security Interest in
Note Priority Collateral 
The Note Senior Lien shall at all times be and remain superior and prior
in right of payment and enforcement to the Bank Junior Lien and the Bank Junior
Lien shall at all times be junior and subordinate to the Note Senior Lien with
respect to the Note Priority Collateral, in each case up to, but not in excess
of, the Note Maximum Amount.

 

2.4                                 Third Party Security Interest.  To the extent that the Bank Junior Lien or
the Note Junior Lien has priority over any Liens in favor of any third party
with respect to the applicable collateral (including, but not limited to, any
trustee or similar party under the Bankruptcy Code), under law or contract, or
priority over the claims of unsecured creditors, nothing in this Agreement
shall alter that priority.

 

3.                   Enforcement
Actions Against Collateral.

 

3.1                                 Collateral Enforcement Action by the
Trustee in Respect of Note Priority Collateral.  The Trustee may, at any time and from time
to time, take or refrain from taking, any Collateral Enforcement Action with
respect to the Note Priority Collateral, without notice to or provision for the
Lender except as expressly provided herein.

 

3.2                                 Collateral Enforcement Action by the
Trustee in Respect of Bank Priority Collateral.  Until the indefeasible payment in full in
cash of the Bank Obligations and the termination of any commitment by the
Lender to extend credit under the Credit Agreement and/or termination of any
provision by the Lender for a voluntary line of credit under the Credit
Agreement, as applicable (or unless the Lender consents in its sole
discretion), the Trustee shall not take any Collateral Enforcement Action with
respect to the Bank Priority Collateral.

 

3.3                                 Collateral Enforcement Action by
Lender in Respect of Bank Priority Collateral.  The Lender may, at any time and from time to
time, take or refrain from taking, any Collateral Enforcement Action with
respect to the Bank Priority Collateral, without notice to or provision for the
Trustee or the Noteholders except as expressly provided herein.

 

3.4                                 Collateral Enforcement Action by
Lender in Respect of Note Priority Collateral.  Until the indefeasible payment in full in
cash of the Note Obligations or a defeasance of the obligations under the
Indenture (or unless the Trustee otherwise consents in its sole discretion),
the Lender shall not take any Collateral Enforcement Action with respect to the
Note Priority Collateral.

 

5

 

4.                   Distributions
From Dispositions of Collateral; Bankruptcy or Liquidation.

 

4.1                                 Proceeds of Note Priority Collateral
in General.  Until the
indefeasible payment in full in cash of the Note Obligations or a defeasance of
the obligations under the Indenture (or unless the Trustee consents in its sole
discretion), except for a sale or other disposition in connection with an
Insolvency Proceeding or Liquidation of an Obligor (which sale or other
disposition shall be governed by Section 4.2), in the event of a sale or
other disposition by the Trustee (whether in connection with a Collateral
Enforcement Action or otherwise) of any or all of the Note Priority Collateral,
except as otherwise provided in the Note Documents, proceeds of such sale or
other disposition, to the extent necessary to satisfy the Note Obligations,
shall be paid over to the Trustee in respect of the Note Obligations to be
applied by the Trustee against such Note Obligations in any order that the
Trustee determines.

 

4.2                                 Distributions in Respect of Note
Priority Collateral in Insolvency Proceeding or Liquidation.  Notwithstanding any other provisions of this
Agreement, until the indefeasible payment in full in cash of the Note
Obligations or a defeasance of the obligations under the Indenture, in the
event of any distribution, division or application, partial or complete,
voluntary or involuntary, by operation of law or otherwise, of all or any part
of the assets of an Obligor or the proceeds thereof, to creditors of such
Obligor by reason of a Liquidation or Insolvency Proceeding, then and in any
such event any payment or distribution or benefit of any kind whatsoever or character,
whether in cash, securities or other property in respect of or arising out of
the Note Priority Collateral shall be payable and paid or delivered directly to
the Trustee, to the extent necessary to satisfy the Note Obligations, for
application to the Note Obligations, whether then due or not due, to be applied
by the Trustee against such Note Obligations in any order that the Trustee
determines.

 

4.3                                 Proceeds of Bank Priority Collateral
in General.  Until the
indefeasible payment in full in cash of the Bank Obligations and the
termination of any commitment by the Lender to extend credit under the Credit
Agreement and/or termination of any provision by the Lender for a voluntary
line of credit under the Credit Agreement, as applicable (or unless the Lender
consents in its sole discretion), except for a sale or other disposition in
connection with an Insolvency Proceeding or Liquidation of an Obligor (which
sale or other disposition shall be governed by Section 4.4), in the event
of a sale or other disposition by the Lender (whether in connection with a
Collateral Enforcement Action or otherwise) of any or all of the Bank Priority
Collateral of such Obligor, except as otherwise provided in the Bank Documents,
all proceeds of such sale or other disposition shall be paid over to the Lender
in respect of the Bank Obligations, to the extent necessary to satisfy the Bank
Obligations, to be applied by the Lender against such Bank Obligations in any
order that the Lender determines.

 

6

 

4.4                                 Distributions in Respect of Bank
Priority Collateral in Insolvency Proceeding or Liquidation.  Notwithstanding any other provisions of this
Agreement, until the indefeasible payment in full in cash of the Bank
Obligations and the termination of any commitment by the Lender to extend
credit under the Credit Agreement and/or termination of any provision by the
Lender for a voluntary line of credit under the Credit Agreement, as applicable
(or unless the Lender consents in its sole discretion), in the event of any
distribution, division or application, partial or complete, voluntary or
involuntary, by operation of law or otherwise, of all or any part of the assets
of an Obligor or the proceeds thereof, to creditors of such Obligor by reason
of a Liquidation or Insolvency Proceeding, then and in any such event any
payment or distribution or benefit of any kind whatsoever or character, whether
in cash, securities or other property in respect of or arising out of the Bank
Priority Collateral shall be payable and paid or delivered directly to the
Lender for application to the Bank Obligations, to the extent necessary to
satisfy the Bank Obligations, whether then due or not due, to be applied by the
Lender against such Bank Obligations in any order that the Lender determines.

 

4.5                                 Excess Proceeds.  Any proceeds from sales or distributions
of, or any other realization on, Note Priority Collateral in excess of the Note
Obligations (subject to Section 11.6) shall be delivered to the Lender to
be applied to the Bank Obligations, or to the Company if the Bank Obligations
have been paid in full in accordance with this Agreement.  Any proceeds from sales or distributions of,
or any other realization on, Bank Priority Collateral in excess of the Bank
Obligations (subject to Section 11.6) shall be delivered to the Trustee to
be applied to the Note Obligations, or to the Company if the Note Obligations
have been paid in full in accordance with this Agreement.

 

5.                   Release
of Junior Liens in Connection with Sales or other Dispositions of Collateral.

 

5.1                                 Release of Note Priority Collateral
in Connection with Collateral Enforcement Action.  At the request of the Trustee, the Lender
shall release its Lien on the Note Priority Collateral in connection with any
transfer, sale or other disposition pursuant to a Collateral Enforcement Action
(including, without limitation, in an action for strict foreclosure) related to
such Note Priority Collateral so that such collateral may be transferred, sold
or otherwise disposed of free of the Bank Junior Lien.

 

5.2                                 Release of Note Priority Collateral
in Connection with Sale Under Indenture.  If any Note Priority Collateral is
transferred, sold or otherwise disposed of by the applicable Obligor in
accordance with the terms of the Indenture and if, in connection therewith, the
Trustee releases the Note Senior Lien on such collateral, at the request of the
Trustee, the Lender shall release the Bank Junior Lien on such collateral, provided,
however, that nothing herein shall serve to waive any default under the Bank
Documents if such transfer, sale or other disposition is not permitted by the
terms thereof.

 

7

 

5.3                                 Release of Bank Priority Collateral
in Connection with Collateral Enforcement Action. At the request
of the Lender, the Trustee shall release its Lien on Bank Priority Collateral
in connection with any transfer, sale or other disposition pursuant to a
Collateral Enforcement Action (including, without limitation, in an action for
strict foreclosure) related to such Bank Priority Collateral so that such
collateral may be transferred, sold or otherwise disposed of free of the Note
Junior Lien.

 

5.4                                 Release of Bank Priority Collateral
in Connection with Sale Under Credit Agreement. 
If any Bank Priority Collateral is transferred, sold or
otherwise disposed of by the applicable Obligor in accordance with the terms of
the Credit Agreement and if, in connection therewith, the Lender releases the
Bank Senior Lien on such collateral, at the request of the Lender, the Trustee
shall release the Note Junior Lien on such collateral, provided,
however, that nothing herein shall serve to waive any default under the Note
Documents if such transfer, sale or other disposition is not permitted by the
terms thereof.

 

6.                   Certain
Notices.

 

6.1                                 The
Lender shall give the Trustee such notices of sales or other dispositions of
the Bank Priority Collateral as is expressly provided in this Agreement.

 

6.2                                 The
Trustee shall give the Lender such notices of sales or other dispositions of
the Note Priority Collateral as is expressly provided in this Agreement.

 

6.3                                 The
Company shall immediately give the Trustee a copy of any notice of acceleration
it receives from the Lender.  The
Company shall immediately give the Lender a copy of any notice of acceleration
it receives from the Trustee.

 

7.                   Further
Assurances; Cooperation of Parties.

 

7.1                                 Trustee Authorized to Act.  The Lender hereby authorizes and empowers
the Trustee, in its discretion, to demand, sue for, collect and receive every
payment or distribution in respect of and give acquittance for the Note
Priority Collateral as the Trustee may deem necessary or advisable for the
enforcement of this Agreement and to collect all payments, distributions or disbursements
made thereon in whatever form the same may be paid or issued, and, in its
discretion, to apply the same on account of any of the Note Obligations,
without regard to the validity of the Bank Junior Lien.  In furtherance of the foregoing, the Lender
agrees duly and promptly to take such action as may be reasonably requested by
the Trustee to assist in the collection of the Note Priority Collateral for the
account of the Trustee and to execute and deliver to the Trustee on demand such
powers of attorney, proofs of claim, assignments of claim or other instruments
as may be reasonably requested by the Trustee to enable the Trustee to enforce
any and all rights upon or with respect to the Note Priority Collateral, and to
collect and receive any and all payments or distributions which may be payable
or 

 

8

 

deliverable at any time upon or with respect to the Note Priority
Collateral as if the Bank Junior Liens had originally been granted in favor of
the Trustee.

 

7.2                                 Payments For the Benefit of Trustee.  If any payment in respect of Note Senior
Collateral is received by the Lender in violation of the terms of this
Agreement prior to the indefeasible payment in full in cash of the Note
Obligations or a defeasance of the obligations under the Indenture (unless
consented to by the Trustee in its sole discretion) the payment or distribution
to the Lender shall be received in trust for the benefit of the Trustee and the
Lender will forthwith deliver the same to the Trustee in precisely the form
received (except for the endorsement of or assignment by the Lender where
necessary), for application to the Note Obligations, whether then due or not
due in such order and manner as the Trustee may elect.

 

7.3                                 Appointment of Lender as
Representative.  If at
any time perfection of the Lien on any Bank Priority Collateral or Note
Priority Collateral is effected by possession or control and the Lender (but
not the Trustee) has such possession or control of such Bank Priority Collateral
or Note Priority Collateral, the Trustee hereby appoints the Lender as its
non-exclusive representative for purposes of perfection by possession or
control and the Lender hereby accepts such appointment, provided that, the
Lender shall not incur liability to the Trustee by virtue of acting as its
representative hereby.  The Lender
agrees that, upon the indefeasible payment in full in cash of the Bank
Obligations and the termination of any commitment by the Lender to extend
credit under the Credit Agreement [and/or termination of any provision by the
Lender for a voluntary line of credit under the Credit Agreement, as
applicable], and provided that any Note Obligations are still outstanding, it
shall promptly transfer possession or control of such collateral to the
Trustee.

 

7.4                                 General Further Assurances by Lender.  The Lender agrees to take such further
action as is reasonably requested by the Trustee to effect the purposes hereof.

 

7.5                                 Limitations on Required Lender
Actions. Notwithstanding anything herein to the contrary, the
Lender shall not be obligated to take action (a) that could, in the reasonable
determination of the Lender, expose the Lender to any liability that would not
be fully reimbursed by the Company as a result of the indemnification provided
herein or otherwise (which determination may take account of the financial
condition of the Company) or other indemnification reasonably satisfactory to
the Lender or (b) that could, in the reasonable determination of the Lender,
cause the Lender to incur costs or expenses that would not be fully reimbursed
by the Company as a result of the expense reimbursement provision provided
herein or otherwise (which determination may take account of the financial
condition of the Company) or other cost reimbursement provision reasonably
satisfactory to the Lender.

 

9

 

7.6                                 Lender Authorized to Act.  The Trustee hereby authorizes and empowers the Lender, in its
discretion, to demand, sue for, collect and receive every payment or
distribution in respect of and give acquittance for the Bank Priority
Collateral as the Lender may deem necessary or advisable for the enforcement of
this Agreement and to collect all payments, distributions or disbursements made
thereon in whatever form the same may be paid or issued, and, in its
discretion, to apply the same on account of any of the Bank Obligations,
without regard to the validity of the Note Junior Lien.  In furtherance of the foregoing, the Trustee
agrees duly and promptly to take such action as may be reasonably requested by
the Lender to assist in the collection of the Bank Priority Collateral for the
account of the Lender and to execute and deliver to the Lender on demand such
powers of attorney, proofs of claim, assignments of claim or other instruments
as may be reasonably requested by the Lender to enable the Lender to enforce
any and all rights upon or with respect to the Bank Priority Collateral, and to
collect and receive any and all payments or distributions which may be payable
or deliverable at any time upon or with respect to the Bank Priority Collateral
as if the Note Junior Liens had originally been granted in favor of the Lender.

 

7.7                                 Payments For the Benefit of Lender.  If any payment in respect of Bank Senior
Collateral is received by the Trustee in violation of the terms of this
Agreement prior to the indefeasible payment in full in cash of the Bank
Obligations and the termination of any commitment by the Lender to extend
credit under the Credit Agreement and/or termination of any provision by the
Lender for a voluntary line of credit under the Credit Agreement, as applicable
(or unless the Lender consents in its sole discretion), the payment or
distribution to the Trustee shall be received in trust for the benefit of the
Lender and the Trustee will forthwith deliver the same to the Lender in
precisely the form received (except for the endorsement of or assignment by the
Trustee where necessary), for application to the Bank Obligations, whether then
due or not due in such order and manner as the Lender may elect.

 

7.8                                 Appointment of Trustee as
Representative.  If at
any time perfection of the Lien on any Bank Priority Collateral or Note
Priority Collateral is effected by possession or control and the Trustee (but
not the Lender) has such possession or control of such Bank Priority Collateral
or Note Priority Collateral, the Lender hereby appoints the Trustee as its
non-exclusive representative for purposes of perfection by possession or
control and the Trustee hereby accepts such appointment, provided that, the
Trustee shall not incur liability to the Lender by virtue of acting as its
representative hereby.  The Trustee
agrees that, upon the indefeasible payment in full in cash of the Note
Obligations and provided that any Bank Obligations are still outstanding, it
shall promptly transfer possession or control of such collateral to the Lender.

 

7.9                                 General Further Assurances by the
Trustee.  The Trustee
agrees to take such further action as is reasonably requested by the Lender to
effect the purposes hereof.

 

10

 

7.10                           Limitations on Required Trustee
Actions. Notwithstanding anything herein to the contrary, the
Trustee shall not be obligated to take action (a) that could, in the reasonable
determination of the Trustee, expose the Trustee to any liability that would
not be fully reimbursed by the Company as a result of the indemnification
provided herein or otherwise (which determination may take account of the financial
condition of the Company) or other indemnification reasonably satisfactory to
the Trustee or (b) that could, in the reasonable determination of the Trustee,
cause the Trustee to incur costs or expenses that would not be fully reimbursed
by the Company as a result of the expense reimbursement provision provided
herein or otherwise (which determination may take account of the financial
condition of the Company) or other cost reimbursement provision reasonably
satisfactory to the Trustee.

 

7.11                           General Further Assurances by
Company.  The Company
agrees to take such further action as is reasonably requested by the Lender or
the Trustee to effect the purposes hereof. 
Without limiting the generality of the foregoing, the Company shall
provide the Lender and the Trustee with access to its properties as
contemplated in Section 8 below.

 

8.                   Limited
Right of Access.

 

8.1                                 Without
limiting any rights the Lender may otherwise have under applicable law or by
agreement, and so long as the Trustee has not commenced, or is not continuing,
a Collateral Enforcement Action with respect to any particular Note Priority
Collateral, the Lender may, during normal business hours, access Bank Priority
Collateral that (A) is stored or located in or on, (B) has become an accession
with respect to (within the meaning of Section 9-335 of the Uniform
Commercial Code), or (C) has been commingled with (within the meaning of
Section 9-336 of the Uniform Commercial Code), such  Note Priority Collateral (collectively, the
“Bank
Commingled Collateral”),  for
the limited purposes of assembling, inspecting, copying or downloading
information stored on, taking actions to perfect its Lien on, completing a
production run of inventory involving, taking possession of, moving, selling
storing or taking Collateral Enforcement Actions with respect to, the Bank
Commingled Collateral (collectively, “Lender Permitted Access Purposes”).

 

8.2                                 Without
limiting any rights the Trustee may otherwise have under applicable law or by
agreement, and so long as the Lender has not commenced, or is not continuing, a
Collateral Enforcement Action with respect to any particular Bank Priority
Collateral, the Trustee may, during normal business hours, access Note Priority
Collateral that (A) is stored or located in or on, (B) has become an accession
with respect to (within the meaning of Section 9-335 of the Uniform
Commercial Code), or (C) has been commingled with (within the meaning of
Section 9-336 of the Uniform Commercial Code), such  Bank Priority Collateral (collectively, the
“Note
Commingled Collateral”), for the limited purposes of assembling,
inspecting, copying or downloading information stored on, taking 

 

11

 

actions to perfect its Lien on, operating, taking possession of,
moving, selling storing or taking Collateral Enforcement Actions with respect
to, the Note Commingled Collateral (collectively, “Trustee Permitted Access Purposes”).

 

8.3                                 Without
limiting any rights the Lender may otherwise have under applicable law or by
agreement and at any time that the Trustee has commenced, and is continuing, a
Collateral Enforcement Action with respect to any particular Note Priority
Collateral, the Lender may, during normal business hours, access the related
Bank Commingled Collateral for Lender Permitted Access Purposes until the
consummation of any sale of such Note Priority Collateral; provided that, the Lender
shall use commercially reasonable efforts to not interfere with the Trustee’s
Collateral Enforcement Action; and provided further that the Trustee shall give
the Lender at least 30 days’ prior written notice (or such shorter period as
shall be agreed to by the Lender), of the consummation of the  sale of such Note Priority Collateral or (b)
arrange for the Lender to access the related Note Priority Collateral
notwithstanding such sale.  The Lender’s
access rights under this Section 8.3 and Section 8.1 are collectively
referred to as the “Lender’s Access Right”.  The Trustee shall give Lender written notice
within three (3) days after it commences any Collateral Enforcement Action
referenced in subsections (a) or (d) of the definition of such term.

 

8.4                                 Without
limiting any rights the Trustee may otherwise have under applicable law or by
agreement and at any time that the Lender has commenced, and is continuing, a
Collateral Enforcement Action with respect to any particular Bank Priority
Collateral, the Trustee may, during normal business hours, access the related
Note Commingled Collateral for Trustee Permitted Access Purposes until the
consummation of any sale of such Bank Priority Collateral; provided that, the Trustee
shall use commercially reasonable efforts to not interfere with the Lender’s
Collateral Enforcement Action; and provided further that the Lender shall (a)
give the Trustee at least 30 days’ prior written notice (or such shorter period
as shall be agreed to by the Lender), of the consummation of the  sale of such Bank Priority Collateral or (b)
arrange for the Trustee to access the related Note Priority Collateral
notwithstanding such sale.  The
Trustee’s access rights under this Section 8.4 and Section 8.2 are
collectively referred to as the “Trustee’s Access Right”.  The Lender shall give the Trustee written
notice within three (3) days after it commences any Collateral Enforcement
Action referenced in subsections (a) or (d) of the definition of such term
against tangible Bank Priority Collateral.

 

8.5                                 If
the Lender damages, destroys or sells any Note Priority Collateral in the
exercise of the Lender’s Access Right or any Collateral Enforcement Action, the
Lender shall, at its expense (but subject to the Company’s indemnification and
reimbursement obligations and application of any available insurance proceeds)
repair or replace such damaged or destroyed Note Priority Collateral or
reimburse the Trustee for its loss.

 

12

 

8.6                                 The
Lender confirms that, in the event of the sale or other transfer of or exercise
of any Collateral Enforcement Action respecting the Bank Priority Collateral,
none of the Note Priority Collateral shall be sold or otherwise transferred
with the Bank Priority Collateral (without the Trustee’s consent) or shall be
damaged or destroyed in connection therewith.

 

8.7                                 The
Trustee shall use commercially reasonable efforts to not hinder or obstruct the
Lender from exercising the Lender’s Access Right.  The Lender shall use commercially reasonable efforts to not
hinder or obstruct the Trustee from exercising the Trustee’s Access Right.

 

8.8                                 The
Trustee confirms that, in the event of the sale or other transfer of or
exercise of any Collateral Enforcement Action respecting the Note Priority
Collateral, none of the Bank Priority Collateral shall be sold or otherwise
transferred with the Note Priority Collateral (without the Lender’s consent) or
shall be damaged or destroyed in connection therewith.

 

8.9                                 If
the Trustee damages, destroys or sells any Bank Priority Collateral in the
exercise of the Trustee’s Access Right or any Collateral Enforcement Action,
the Trustee shall, at its expense (but subject to the Company’s indemnification
and reimbursement obligations and application of any available insurance
proceeds) repair or replace such damaged or destroyed Bank Priority Collateral
or reimburse the Lender for its loss.

 

9.                   Certain
Waivers.

 

9.1                                 Validity of Note Senior Lien.
The Lender waives any right to contest the validity, perfection, enforceability
or priority of the Note Senior Lien, whether in connection with an Insolvency
Proceeding or otherwise.

 

9.2                                 Certain Waivers of Lender Relative
to Note Priority Collateral, Marshalling, Etc. 
The Lender waives (a) any right it may have to object to
any sale or other disposition of or realization on Note Priority Collateral by
or on behalf of the Trustee, including, without limitation, on the grounds of
failure to provide adequate notice, so long as the Lender shall have received
at least five business days’ notice of such sale or other disposition (which
notice is deemed to be reasonable by the Lender) (b) any right to claim or take
advantage of any appraisal, valuation, stay, extension, moratorium, turnover,
redemption or similar law that may prevent, delay, hinder or otherwise
adversely affect a Collateral Enforcement Action relative to any Note Priority
Collateral, (c) any right it may have to require the Trustee to marshal any
assets of the Obligors in favor of the Lender, (d) any rights of subrogation
relative to the Note Priority Collateral, and (e) presentment, demand, protest
and notice of any kind (except as expressly required herein), in each case to
the fullest extent permitted by applicable law.  Without limiting the generality of the foregoing, except to the
extent specifically provided for in this Agreement, the Lender hereby agrees
that any lawful action 

 

13

 

taken by or on behalf of the Trustee in the exercise of any Collateral
Enforcement Action in respect of the Note Priority Collateral shall be deemed
to be consented to and approved by the Lender in all respects, including,
without limitation, at the option of the Trustee, the sale or other disposition
or realization on or of any or all of the Note Priority Collateral, free of the
Bank Junior Lien.

 

9.3                                 Validity of Bank Senior Lien.  The Trustee waives any right to contest the
validity, perfection, enforceability or priority of the Bank Senior Lien,
whether in connection with an Insolvency Proceeding or otherwise.

 

9.4                                 Certain Waivers of Trustee Relative
to Bank Priority Collateral, Marshalling, Etc. 
The Trustee waives (a) any right it may have to object to
any sale or other disposition of or realization on Bank Priority Collateral by
or on behalf of the Bank, including, without limitation, on the grounds of
failure to provide adequate notice, so long as the Trustee shall have received
at least five business days’ notice of such sale or other disposition (which
notice is deemed to be reasonable by the Trustee), or on the grounds that
equity collateral could yield greater proceeds if it were registered under
applicable securities laws, (b) any right to claim or take advantage of any
appraisal, valuation, stay, extension, moratorium, turnover, redemption or
similar law that may prevent, delay, hinder or otherwise adversely affect a
Collateral Enforcement Action relative to any Bank Priority Collateral, (c) any
right it may have to require the Bank to marshal any assets of the Obligors in
favor of the Trustee, (d) any rights of subrogation relative to the Bank
Priority Collateral, and (e) presentment, demand, protest and notice of any
kind (except as expressly required herein), in each case to the fullest extent
permitted by applicable law.  Without
limiting the generality of the foregoing, except to the extent specifically
provided for in this Agreement, the Trustee hereby agrees that any lawful
action taken by or on behalf of the Lender in the exercise of any Collateral
Enforcement Action in respect of the Bank Priority Collateral shall be deemed
to be consented to and approved by the Trustee in all respects, including,
without limitation, at the option of the Lender, the sale or other disposition
or realization on or of any or all of the Bank Priority Collateral, free of the
Note Junior Lien.

 

9.5                                 Waiver of Certain Objections In
Connection with Bankruptcy Financing.  If any of the Obligors shall become subject to an Insolvency
Proceeding and if the Lender desires to permit the use of any Bank Priority
Collateral consisting of cash collateral and/or to provide or permit financing
to such Obligor under either Section 363 or Section 364 of the
Bankruptcy Code (or any subsequent provision relating to such matters) secured
by any Bank Priority Collateral, the Trustee agrees not to object to any such
financing secured by Bank Priority Collateral or such use of Bank Priority
Collateral consisting of cash collateral on the grounds of a failure to provide
“adequate protection” for the Trustee; it being understood that, in the case of
any such post-petition financing provided by the Lender, the Trustee shall have
a post-petition Lien on the affected Bank Priority Collateral subordinated to
the Lender’s replacement Lien on such collateral to the same 

 

14

 

extent as the Note Junior Lien is subordinated to the Bank Senior Lien
pursuant to this Agreement.

 

10.            Continuing
Lien Priorities.

 

10.1                           The
lien priorities provided in this Agreement and obligations and rights of the
parties hereunder shall not be altered or otherwise affected by:

 

(a)                                  the
order, time, manner of attachment, perfection or recording of the Liens in
favor of the Lender or the Trustee;

 

(b)                                 any
refinancing of or amendments to the terms of or any assignments under the Bank
Documents or the Note Documents, subject only to the provisions of
Section 11;

 

(c)                                  any
action or inaction by the Lender with respect to the Bank Priority Collateral
or its other rights and obligations under the Bank Documents or any action or
inaction by the Trustee with respect to the Note Priority Collateral or its
other rights and obligations under the Note Documents;

 

(d)                                 the
institution or pendency of any Insolvency Proceeding or Liquidation of any
Obligor;

 

(e)                                  the
availability of any other right of the Trustee or the Lender; or

 

(f)                                    Any
other event or condition that could otherwise affect the enforceability of the
terms of this Agreement.

 

11.            Modifications
of Debt Documents, Assignments and Refinancings.

 

11.1                           Modifications, Assignments and
Refinancings of Bank Obligations in General.  From time to time, the Bank Documents may be
amended, restated, modified and/or supplemented, the Bank Obligations may be
refinanced pursuant to new Bank Documents and the Lender may assign any or all
of its rights and obligations under the Bank Documents, in each case, secured
by the Bank Senior Lien and Bank Junior Lien, subject only to the provisions of
the following Sections 11.2 and 11.3 below.

 

11.2                           Limitations on Amount of Bank
Obligations. 
Notwithstanding anything else provided herein, until the indefeasible
payment in full in cash of the Note Obligations or a defeasance of the
obligations under the Indenture (or unless the Trustee otherwise consents in
its sole discretion), if the Lender amends, restates, modifies, supplements,
and or refinances the Bank Obligations in any manner that results in the
Company being permitted to incur indebtedness under the Bank Documents in an
aggregate principal amount (the “Bank Actual Principal Amount”) in excess of
the greater of (a) $20,000,000 and (b) the sum of 85% of 

 

15

 

the amount of the net book value of the accounts receivable of the
Company and its subsidiaries, on a consolidated basis, and 50% of the net book
value of inventory of the Company and its subsidiaries, on a consolidated
basis, in each case determined in accordance with generally accepted accounting
principles (the greater being referred to as the “Bank Permitted Principal Amount”),
then the excess of the Bank Actual Principal amount over the Bank Permitted
Principal Amount (and all interest on (including interest rate protection
obligations) and fees in respect of such excess amount) shall not be entitled
to the Bank Senior Lien.

 

11.3                           Bank Obligations to Remain Subject
to this Agreement.  Any
amendment, restatement, modification, supplement, and /or refinancing of the
Bank Obligations shall be expressly subject to the terms of this Agreement.

 

11.4                           No Waiver of Default Under Note
Documents.  Nothing
herein shall serve to waive any default under the Note Documents if such
amendment, restatement, modification, supplement, and /or refinancing of the
Bank Obligations is not permitted by the terms thereof.

 

11.5                           Modifications, Assignments and
Refinancings of Note Obligations in General.  From time to time, the Note Documents may be
amended, restated, modified and/or supplemented, the Note Obligations may be
refinanced pursuant to new Note Documents and the Trustee (and Noteholders) may
assign any or all of its (their) rights and obligations under the Note
Documents, in each case, secured by the Note Senior Lien and Note Junior Lien,
subject only to the provisions of the following Sections 11.6 and 11.7 below.

 

11.6                           Limitations on Amount of Note
Obligations. 
Notwithstanding anything else provided herein, until the indefeasible
payment in full in cash of the Bank Obligations and the termination of any
commitment by the Lender to extend credit under the Credit Agreement (or unless
the Lender consents in its sole discretion), if the Trustee amends, restates,
modifies, supplements, and/or refinances the Note Obligations in any manner
that results in the Company being permitted to incur indebtedness under the
Note Documents in an aggregate principal amount (the “Note Actual Principal Amount”)
in excess of $105,000,000 (the “Note Permitted Principal Amount”), then the
excess of the Note Actual Principal Amount over the Note Permitted Principal
Amount (and all interest on (including interest rate protection obligations)
and fees in respect of such excess amount) shall not be entitled to the Note
Senior Lien.

 

11.7                           Note Obligations to Remain Subject
to this Agreement.  Any
amendment, restatement, modification, supplement, and /or refinancing of the
Note Obligations shall be expressly subject to the terms of this Agreement.

 

11.8                           No Waiver of Default Under Bank
Documents.  Nothing
herein shall serve to waive any default under the Bank Documents if such
amendment, restatement, 

 

16

 

modification, supplement, and /or refinancing of the Note Obligations
is not permitted by the terms thereof.

 

11.9                           Insolvency Proceeding Limitation.  The provisions of this Section 11 shall
not apply to any financing provided in connection with an Insolvency Proceeding
in accordance with Section 9.5.

 

12.            Joinder
of Additional Guarantors.

 

12.1                           Additional Guarantors.  Pursuant to the Bank Documents and the Note
Documents, subsidiaries of the Company which are acquired or organized after
the date of this Agreement may be required to become guarantors of the Bank
Obligations and/or the Note Obligations and provide security in connection
therewith.  At any time that such a
subsidiary becomes a guarantor of the Bank Obligations and the Note
Obligations, it shall join in this Agreement, with the same effect and to the
same extent as if such subsidiary had been named herein as a Guarantor.  The Company covenants and agrees that it
will cause any such subsidiary which becomes obligated to guarantee the
obligations of the Company under the Bank Documents and the Note Documents to
execute a joinder agreement satisfactory in form and substance to the Lender
and the Trustee.  The execution and
delivery of such joinder shall not require the consent of any other party
hereunder, and will be acknowledged by the Lender and the Trustee.  The rights and obligations of each Guarantor
hereunder shall remain in full force and effect notwithstanding the addition of
any new Guarantor as a party to this Agreement.

 

13.            Miscellaneous.

 

13.1                           Rights and Obligations.

 

13.1.1                  It is acknowledged that any interest
rate protection agreements that are issued in accordance with the Credit
Agreement from time to time may be issued by an affiliate of the Lender, and in
such event, that affiliate shall be bound by the obligations and entitled to
the benefits of the Lender hereunder with respect to such interest rate
protection agreements.

 

13.1.2                  All of the rights and obligations of
the Trustee hereunder are for the benefit of and binding on the Noteholders.

 

13.1.3                  The terms of this Agreement are
intended to set forth the relative rights and obligations of the Trustee and
the Lender as between each other and nothing in this Agreement shall confer any
rights on any Obligors.  Without
limiting the generality of the foregoing, the Obligors shall not be entitled to
require any release or subordination of Liens in connection with this
Agreement.

 

17

 

13.2                           Lender and Trustee May Act
through Agents.  The
Lender and the Trustee may execute any of their respective rights or
obligations under this Agreement (including but not limited to, Collateral
Enforcement Actions) directly or indirectly by delegating such right to any
agent or agents chosen by the Lender or the Trustee, as applicable (each such
person, an “Agent”) and neither the Lender, nor the Trustee, shall be
responsible for any misconduct on the part of any such Agent, appointed with
due care by it hereunder.  Any Agent
shall be entitled to reimbursed for costs and expenses in accordance with
Section 13.3 hereof, be entitled to indemnification pursuant to
Section 13.4 hereof and be entitled to the limitations on liability
provided in Section 13.5 hereof.

 

13.3                           Costs and Expenses.  Without limiting the generality of any other
cost reimbursement provisions that may be provided for in the Bank Documents or
the Note Documents, the Company and each of the Guarantors, jointly and
severally, agree to pay to the Lender, the Trustee and their respective Agents,
from time to time upon demand all of fees, costs and expenses of the Lender,
the Trustee and their respective Agents (including, without limitation, the
fees and disbursements of counsel and other professionals and consultants as
such party elects to retain) arising in connection with the preparation,
execution, delivery, modification and termination of this Agreement, any
actions of the Lender or the Trustee contemplated by this Agreement or the
enforcement of any provisions hereof, the Note Documents and the Bank
Documents.  The obligations under this
Section 132.3 shall survive the termination of this Agreement.

 

13.4                           Indemnification.  Without limiting any indemnification
obligations of the Obligors that may be contained in any of the Bank Documents
or the Note Documents, the Company and each of the Guarantors, jointly and
severally, agree to pay, indemnify, and hold each of the Lender, the Trustee
and their respective Agents harmless from and against any and all liabilities,
obligations, losses, damages, penalties, actions, judgments, suits, costs,
expenses or disbursements of any kind or nature whatsoever (collectively, “Liabilities”)
with respect to the execution, delivery, and performance of their obligations
under this Agreement, any actions contemplated by this Agreement, any failure
to act in accordance with the terms of this Agreement or any other Liabilities
arising out of this Agreement, or the enforcement of any provisions hereof, the
Note Documents and the Bank Documents. 
The obligations under this Section 132.4 shall survive the termination
of this Agreement.

 

13.5                           Limitation of Liabilities.  Except
as provided in Sections 8.5 and 8.9, each of the Lender, the Trustee and their
respective Agents shall not be liable for any action taken or omitted by it, or
any action suffered by it to be taken or omitted, in good faith, unless arising
as a result of the gross negligence or willful misconduct of such party.  The provisions of this
Section 13.5 shall survive the termination of this Agreement.

 

18

 

13.6                           Notices.  Unless otherwise expressly provided under
this Agreement all notices, requests, demands, directions and other
communications (collectively “Notices”) given to or made upon any
party under the provisions of this Agreement shall be in writing (including
facsimile communication) and if in writing shall be delivered by hand,
nationally recognized overnight courier or U.S. mail or sent by facsimile, if
to the Trustee to the following address: 101 Barclay Street, Fl. 8 West, New
York, NY 10286 and if to the other parties hereto, to their respective  addresses and numbers set forth in the
Credit Agreement or in accordance with any subsequent unrevoked confirmed
written direction from any party to the others.  All Notices shall, except as otherwise expressly provided in this
Agreement, be effective (a) in the case of facsimile, when received, (b) in the
case of hand-delivered Notice, when hand delivered, (c) if given by U.S. mail,
the day after such communication is deposited in the mails with overnight first
class postage prepaid, return receipt requested, and (d) if given by any other
means (including by air courier), when delivered.

 

13.7                           No Implied Obligations.  The Lender and the Trustee shall not be
liable except for the performance of any such duties or obligations as are
specifically set forth herein, and no implied duties, covenants or obligations
shall be read into this Agreement against the Lender or the Trustee.

 

13.8                           Waivers.  The terms of this Agreement may be waived,
altered or amended only by an instrument in writing duly executed by the
Lender, the Trustee and the Company.

 

13.9                           Successors and Assigns.  This Agreement shall be binding upon and
inure to the benefit of and be enforceable by the parties hereto and their
respective successors and assigns, provided, however, that Company and
the Guarantors shall not assign or transfer its rights or obligations hereunder
without the specific written approval of the Lender and the Trustee.

 

13.10                     Counterparts.  This Agreement may be executed in one or more counterparts, each
of which shall constitute an original, but all of which taken together shall
constitute one and the same instrument. 
Delivery of a photocopy or telecopy of an executed counterpart of a
signature page to this Agreement shall be as effective as delivery of a manually
executed counterpart of this Agreement.

 

13.11                     Governing Law.  THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE
PERFORMED IN THE STATE OF NEW YORK, INCLUDING SECTIONS 5-1401 AND 5-1402 OF THE
NEW YORK GENERAL OBLIGATIONS LAW AND NEW YORK CIVIL PRACTICE LAWS AND RULES
327(b).

 

13.12                     Waiver of Jury Trial.  FOR THE PURPOSES OF THIS AGREEMENT, EACH PARTY HERETO HEREBY KNOWINGLY,
VOLUNTARILY AND 

 

19

 

INTENTIONALLY WAIVES, TO THE EXTENT PERMITTED BY
APPLICABLE LAW, ANY AND ALL RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN ANY
LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER
VERBAL OR WRITTEN), OR ACTIONS OR OMISSIONS OF ANY PARTY HERETO, OR ANY OTHER
PERSON, RELATING TO THIS AGREEMENT.

 

13.13                     Waiver of Certain Damages.  Each of
the parties hereto waives the right to, and agrees not to assert any claim to,
on any theory of liability, consequential, special, indirect, exemplary,
punitive or any other damages other than actual direct damages, arising out of
or otherwise relating to the transactions contemplated hereby.

 

13.14                     No Third-Party
Beneficiaries.  All undertakings, agreements,
representations and warranties contained in this Agreement are solely for the
benefit of the Lender, the Trustee, the Noteholders, and their respective
Agents, successors and permitted assigns. 
There are no other parties who are intended to be benefited in any way
by this Agreement and, without limiting the provisions of Section 13.13
nothing herein shall give the Company or the Guarantors or any third party any
benefit or any legal or equitable right or remedy under this Agreement.  Without limiting the generally of the
foregoing, the existence of this Agreement shall not (a) commit or obligate the
Lender or the Trustee to make loans or extend credit to any of the Company or
the Guarantors or (b) limit or effect any of rights or available remedies of
the Lender or the Trustee pursuant to any other agreement with the Company or
the Guarantors.

 

13.15                     Severability.  Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof in such jurisdiction, and any such
prohibition or unenforceability in any jurisdiction shall not invalidate or
render unenforceable such provision in any other jurisdiction.

 

13.16                     Headings. 
Section headings used herein are for convenience only and are not
to affect the construction of or be taken into consideration in interpreting
this Agreement.

 

[next page is start of signature pages]

 

20

 

IN WITNESS WHEREOF, the undersigned have
executed this Agreement as of the day and year first above written.

 

 

	
  THE BANK OF NEW YORK,

  as Trustee

  	
   

  	
  FLEET NATIONAL BANK

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Marie E. Trimboli

  	
   

  	
   

  	
  By:

  	
  /s/  

  	
   

  
	
   

  	
  Name: Marie E. Trimboli

  	
   

  	
   

  	
  Name: 

  
	
   

  	
  Title: Assistant Vice
  President

  	
   

  	
   

  	
  Title: 

  
	
   

  	
   

  	
   

  
	
  SHERIDAN ACQUISITION
  CORP.

  	
   

  	
  THE SHERIDAN GROUP,
  INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ J. Rice Edmonds

  	
   

  	
   

  	
  By:

  	
  /s/ John A. Saxton

  	
   

  
	
   

  	
  Name: J. Rice Edmonds

  	
   

  	
   

  	
  Name: John A. Saxton

  
	
   

  	
  Title: Vice President

  	
   

  	
   

  	
  Title: Chief Executive
  Officer

  
	
   

  	
   

  	
   

  
	
  THE SHERIDAN GROUP
  HOLDING COMPANY

  	
   

  	
  THE SHERIDAN PRESS,
  INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ John A. Saxton

  	
   

  	
   

  	
  By:

  	
  /s/ John A. Saxton

  	
   

  
	
   

  	
  Name: John A. Saxton

  	
   

  	
   

  	
  Name: John A. Saxton

  
	
   

  	
  Title:

  	
   

  	
   

  	
  Title: Chief Executive
  Officer

  
	
   

  	
   

  	
   

  
	
  CAPITAL CITY PRESS,
  INC.

  	
   

  	
  SHERIDAN BOOKS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ John A. Saxton

  	
   

  	
   

  	
  By:

  	
  /s/ John A. Saxton

  	
   

  
	
   

  	
  Name: John A. Saxton

  	
   

  	
   

  	
  Name: John A. Saxton

  
	
   

  	
  Title: Chief Executive
  Officer

  	
   

  	
   

  	
  Title: Chief Executive
  Officer

  
	
   

  	
   

  	
   

  
	
  DARTMOUTH PRINTING
  COMPANY

  	
   

  	
  DARTMOUTH JOURNAL
  SERVICES, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ John A. Saxton

  	
   

  	
   

  	
  By:

  	
  /s/ John A. Saxton

  	
   

  
	
   

  	
  Name: John A. Saxton

  	
   

  	
   

  	
  Name: John A. Saxton

  
	
   

  	
  Title: Chief Executive
  Officer

  	
   

  	
   

  	
  Title: Chief Executive
  Officer

  
	
   

  	
   

  	
   

  
	
  UNITED LITHO, INC.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ John A. Saxton

  	
   

  	
   

  	
   

  
	
   

  	
  Name: John A. Saxton

  	
   

  	
   

  
	
   

  	
  Title: Chief Executive
  Officer

  	
   

  	
   

  

 

21Exhibit
10.3

 

Execution Version

 

 

 

SECURITIES HOLDERS AGREEMENT

 

by and among

 

TSG HOLDINGS CORP.,

 

BRUCKMANN, ROSSER, SHERRILL & CO. II, L.P.,

 

ING FURMAN SELZ INVESTORS III L.P.,

 

ING BARINGS GLOBAL LEVERAGED EQUITY PLAN LTD.,

 

ING BARINGS U.S. LEVERAGED EQUITY PLAN LLC,

 

and

 

THE OTHER INVESTORS NAMED HEREIN

 

 

Dated as of August 21, 2003

 

 

 

 

TABLE OF CONTENTS

 

	
  ARTICLE I RESTRICTIONS ON TRANSFER OF
  SECURITIES

  	
   

  
	
   

  	
   

  
	
  1.1.

  	
  Restrictions on
  Transfers of Securities

  	
   

  
	
  1.2.

  	
  Legend

  	
   

  
	
  1.3.

  	
  Notation

  	
   

  
	
   

  	
   

  
	
  ARTICLE II OTHER COVENANTS AND
  REPRESENTATIONS

  	
   

  
	
   

  	
   

  
	
  2.1.

  	
  Financial
  Statements and Other Information

  	
   

  
	
  2.2.

  	
  Sale of
  the Company

  	
   

  
	
  2.3.

  	
  Tag-Along
  Rights

  	
   

  
	
  2.4.

  	
  Preemptive
  Rights

  	
   

  
	
  2.5.

  	
  Corporate
  Opportunity

  	
   

  
	
  2.6.

  	
  Restrictive
  Covenants

  	
   

  
	
   

  	
   

  
	
  ARTICLE III CORPORATE ACTIONS

  	
   

  
	
   

  	
   

  
	
  3.1.

  	
  Amended
  and Restated Certificate of Incorporation and Bylaws

  	
   

  
	
  3.2.

  	
  Directors and Voting
  Agreements

  	
   

  
	
  3.3.

  	
  Right
  to Remove Certain of the Company’s Directors

  	
   

  
	
  3.4.

  	
  Right
  to Fill Certain Vacancies in Company’s Board

  	
   

  
	
  3.5.

  	
  Directors of Subsidiaries

  	
   

  
	
  3.6.

  	
  Amendment of
  Certificate and Bylaws

  	
   

  
	
  3.7.

  	
  Termination of Voting
  Agreements

  	
   

  
	
  3.8.

  	
  Officers

  	
   

  
	
  3.9.

  	
  Committees

  	
   

  
	
   

  	
   

  
	
  ARTICLE IV ADDITIONAL
  RESTRICTIONS ON TRANSFERS OF MANAGEMENT SECURITIES HELD BY MANAGEMENT INVESTORS

  	
   

  
	
   

  	
   

  
	
  4.1.

  	
  Certain
  Definitions

  	
   

  
	
  4.2.

  	
  Restrictions
  on Transfer

  	
   

  
	
  4.3.

  	
  Purchase Option

  	
   

  
	
  4.4.

  	
  Involuntary
  Transfers

  	
   

  
	
  4.5.

  	
  Purchaser
  Representative

  	
   

  
	
   

  	
   

  
	
  ARTICLE V MISCELLANEOUS

  	
   

  
	
   

  	
   

  	
   

  
	
  5.1.

  	
  Amendment and Modification

  	
   

  

 

i

 

	
  5.2.

  	
  Successors
  and Assigns

  	
   

  
	
  5.3.

  	
  Separability

  	
   

  
	
  5.4.

  	
  Notices

  	
   

  
	
  5.5.

  	
  Governing Law

  	
   

  
	
  5.6.

  	
  Headings

  	
   

  
	
  5.7.

  	
  Counterparts

  	
   

  
	
  5.8.

  	
  Further
  Assurances

  	
   

  
	
  5.9.

  	
  Termination

  	
   

  
	
  5.10.

  	
  Remedies

  	
   

  
	
  5.11.

  	
  Party No Longer
  Owning Securities

  	
   

  
	
  5.12.

  	
  No
  Effect on Employment

  	
   

  
	
  5.13.

  	
  Pronouns

  	
   

  
	
  5.14.

  	
  Future Individual Investors

  	
   

  
	
  5.15.

  	
  Entire
  Agreement

  	
   

  

 

ii

 

	
  EXHIBITS

  
	
   

  	
   

  
	
  Exhibit A

  	
  Amended and Restated
  Certificate of Incorporation of the Company

  
	
  Exhibit
  C

  	
  Bylaws
  of the Company

  
	
   

  	
   

  
	
   

  	
   

  
	
  SCHEDULES

  
	
   

  	
   

  
	
  Schedule I

  	
  Investors and Securities
  Exchanged and Purchased

  

 

iii

 

DEFINED TERMS

 

	
  Affiliate

  	
   

  
	
  Agreement

  	
   

  
	
  Approved Sale

  	
   

  
	
  BRS

  	
   

  
	
  BRS Affiliates

  	
   

  
	
  BRS Associates

  	
   

  
	
  BRS Directors

  	
   

  
	
  BRS Partner

  	
   

  
	
  Common Stock

  	
   

  
	
  Company

  	
   

  
	
  Designated Purchaser

  	
   

  
	
  Escrow Amount

  	
   

  
	
  Escrow Notice

  	
   

  
	
  Exchange Act

  	
   

  
	
  Fair Market Value Price

  	
   

  
	
  Holders

  	
   

  
	
  ING Barings Global

  	
   

  
	
  ING Barings U.S.

  	
   

  
	
  ING Furman Selz

  	
   

  
	
  Investor

  	
   

  
	
  Investors

  	
   

  
	
  Jefferies Affiliates

  	
   

  
	
  Jefferies Associates

  	
   

  
	
  Jefferies Directors

  	
   

  
	
  Jefferies Funds

  	
   

  
	
  Jefferies Partner

  	
   

  
	
  Jointly Designated
  Directors

  	
   

  
	
  Management Investors

  	
   

  
	
  Management Securities

  	
   

  
	
  Option Purchase Price

  	
   

  
	
  Option Termination Date

  	
   

  
	
  Permitted Transferee

  	
   

  
	
  Preemptive Notice

  	
   

  
	
  Preemptive Reply

  	
   

  
	
  Preferred Stock

  	
   

  
	
  Proffered Valuation

  	
   

  
	
  Public Offering

  	
   

  
	
  Purchase Number

  	
   

  
	
  Purchase Option

  	
   

  
	
  Qualified Investors

  	
   

  

 

iv

 

	
  Required Holders

  	
   

  
	
  Sale Notice

  	
   

  
	
  Securities

  	
   

  
	
  Securities Act

  	
   

  
	
  Securities Purchase
  Agreement

  	
   

  
	
  Securities Purchase and
  Exchange Agreement

  	
   

  
	
  Seller

  	
   

  
	
  Seller’s Notice

  	
   

  
	
  Sheridan

  	
   

  
	
  Sheridan Acquisition

  	
   

  
	
  Sheridan Common Stock

  	
   

  
	
  Special Registration
  Statement

  	
   

  
	
  Stock Purchase
  Agreement

  	
   

  
	
  Subsidiary

  	
   

  
	
  Tag-Along Notice

  	
   

  
	
  Termination Date

  	
   

  
	
  Transfer

  	
   

  
	
  Transfer Date

  	
   

  
	
  Unit Offering

  	
   

  

 

v

 

SECURITIES HOLDERS AGREEMENT

 

THIS IS A SECURITIES HOLDERS AGREEMENT, dated as of
August 21, 2003 (the “Agreement”), by and among TSG Holdings Corp., a
Delaware corporation (the “Company”), Bruckmann, Rosser, Sherrill &
Co. II, L.P., a Delaware limited partnership (“BRS”), ING Furman Selz
Investors III L.P., a Delaware limited partnership (“ING Furman Selz”),
ING Barings Global Leveraged Equity Plan Ltd., a Bermuda corporation, (“ING
Barings Global”), ING Barings U.S. Leveraged Equity Plan LLC, a Delaware
limited liability company (“ING Barings U.S.” and, together with ING
Furman Selz and ING Barings Global, the “Jefferies Funds”), and the
individuals designated as Management Investors on the signature pages hereto
(the “Management Investors”). 
BRS, each of the Jefferies Funds and each of the Management Investors
and any other investor in the Company who becomes a party to or agrees to be
bound by this Agreement are sometimes referred to herein individually as an “Investor”
and collectively as the “Investors.”

 

Background

 

A.                                   This
Agreement is being entered into in connection with the consummation of the
transactions contemplated by the Stock Purchase Agreement, dated as of
August 1, 2003 (the “Stock Purchase Agreement”), by and among
Sheridan Acquisition Corp., a Delaware corporation and wholly-owned subsidiary
of the Company (“Sheridan Acquisition”), The Sheridan Group, Inc., a
Maryland corporation (“Sheridan”), and the other parties thereto,
pursuant to which Sheridan Acquisition will acquire all of the outstanding
capital stock of Sheridan (other than any shares acquired by the Company
pursuant to the Securities Purchase and Exchange Agreement, dated as of the
date hereof (the “Securities Purchase and Exchange Agreement”)), and
Sheridan will become a wholly-owned subsidiary of the Company.

 

B.                                     The
Management Investors are employed by or serve as directors of Sheridan or its
direct or indirect subsidiaries. 
Immediately prior to the closing of the transactions contemplated by the
Stock Purchase Agreement, and after the conversion of all outstanding shares of
Sheridan preferred stock and the exercise of all outstanding options and
warrants to purchase Sheridan common stock as contemplated by the Stock
Purchase Agreement, each of the Management Investors will own shares of
Sheridan common stock (the “Sheridan Common Stock”).

 

C.                                     Pursuant
to the terms of the Securities Purchase and Exchange Agreement, certain of the
Management Investors have exchanged for a number of shares of Sheridan Common
Stock owned by such Management Investor and/or have purchased for cash the
number of shares of the Company’s Series A 10% Cumulative Compounding Preferred
Stock, par value $.001 per share (the “Preferred Stock”), and Common
Stock, par value $.001 per share (the “Common Stock”), set forth
opposite such Management Investor’s name on Schedule I hereto.

 

D.                                    Pursuant
to the terms of a Securities Purchase Agreement, dated as of the date hereof
(the “Securities Purchase Agreement”), the Company has sold, and each of
BRS and

 

 

the Jefferies Funds have purchased for cash, (i) the number of shares
of Preferred Stock of the Company, and (ii) the number of shares of Common
Stock of the Company, in each case as set forth opposite such Investor’s name
on Schedule I hereto.

 

E.                                      Immediately
following the purchase and sale of securities referred to above, the Company
will contribute the cash and non-cash proceeds from such transactions to
Sheridan Acquisition, which will use such cash proceeds in part to acquire
pursuant to the Stock Purchase Agreement the outstanding capital stock of
Sheridan that is not otherwise owned by Sheridan Acquisition by virtue of the
transactions described above.

 

F.                                      The
Investors and the Company wish to set forth herein certain agreements regarding
their future relationships and their rights and obligations with respect to
Securities of the Company.

 

G.                                     As
used herein, the term “Securities” shall mean Common Stock, Preferred
Stock, and any other shares of capital stock of the Company, and any securities
convertible into or exchangeable for such capital stock, and any options
(including any options now or hereafter issued to Management Investors),
warrants or other rights to acquire such capital stock or securities, now or
hereafter held by any party hereto, including all other securities of the
Company (or a successor to the Company) received on account of ownership of
Common Stock or Preferred Stock, including all securities issued in connection
with any merger, consolidation, stock dividend, stock distribution, stock
split, reverse stock split, stock combination, recapitalization,
reclassification, subdivision, conversion or similar transaction in respect
thereof.

 

Terms

 

In consideration of the mutual covenants contained
herein, and intending to be legally bound hereby, the parties hereto agree as
follows:

 

ARTICLE I

 

RESTRICTIONS ON TRANSFER OF SECURITIES

 

1.1.                              Restrictions
on Transfers of Securities.  The following restrictions on Transfer (as
defined in Section 1.1(a) below) shall apply to all Securities owned by
any Investor or Permitted Transferee (as defined in Section 1.1(b) below),
except a Permitted Transferee by virtue of Section 1.1(b)(iv) hereof:

 

(a)                                  No Investor or Permitted Transferee shall
Transfer (other than in connection with a redemption or purchase by the
Company) any Securities unless (i) such Transfer is to a person approved in
advance in writing by the Required Holders (as defined in Section 2.2(a)), and
(ii) such Transfer complies with the provisions of this Section 1.1, Article II
hereof, and, in addition, in the case of Management Securities (as defined in
Section 4.1(a)), Article IV of this Agreement. 
Any purported Transfer in violation of this Agreement shall be

 

2

 

null
and void and of no force and effect, and the purported transferee shall have no
rights or privileges in or with respect to the Company.  As used herein, “Transfer” includes
the making of any sale, exchange, assignment, hypothecation, gift, security
interest, pledge or other encumbrance, or any contract therefor, any voting
trust or other agreement or arrangement with respect to the transfer or grant
of voting rights (except for the voting agreement set forth in Article III
hereof) or any other beneficial interest in any of the Securities, the creation
of any other claim thereto or any other transfer or disposition whatsoever,
whether voluntary or involuntary, affecting the right, title, interest or
possession in or to such Securities.

 

Prior to any proposed
Transfer of any Securities, the holder thereof shall give written notice to the
Company describing the manner and circumstances of the proposed Transfer,
together with, if requested by the Company, a written opinion of legal counsel,
addressed to the Company and the transfer agent for the Company’s equity
securities, if other than the Company, and reasonably satisfactory in form and
substance to the Company, to the effect that the proposed Transfer of the
Securities may be effected without registration under the Securities Act of
1933, as amended (the “Securities Act”).  Each certificate evidencing the Securities transferred shall bear
the legends set forth in Section 1.2(a) hereof, except that such certificate
shall not bear the legend contained in the first paragraph of
Section 1.2(a) hereof if the opinion of counsel referred to above is to
the further effect that such legends is not required in order to establish
compliance with any provision of the Securities Act.

 

Nothing in this Section
1.1(a) shall prevent the Transfer, free of any restrictions under this
Agreement, of Securities by an Investor or a Permitted Transferee to one or
more of its Permitted Transferees or to the Company; provided, however,
that each such Permitted Transferee (except a Permitted Transferee by virtue of
Section 1.1(b)(iv) hereof) shall take such Securities subject to and be fully
bound by the terms of this Agreement applicable to it with the same effect as
if it were an Investor (or if the Permitted Transferee were a Management
Investor, a Management Investor) hereunder; and provided  further,
however, that (i) no person (other than a Permitted Transferee by virtue
of Section 1.1(b)(iv) hereof) shall be a Permitted Transferee unless such
transferee executes and delivers a joinder to this Agreement reasonably
satisfactory in form and substance to the Company which joinder states that
such person agrees to be fully bound by this Agreement as if it were an
Investor (or if the Permitted Transferee were a Management Investor, a
Management Investor) hereunder, and (ii) no Transfer shall be effected except
in compliance with the registration requirements of the Securities Act and any
applicable state securities laws or pursuant to an available exemption
therefrom.

 

(b)                                 As used herein, “Permitted Transferee”
shall mean:

 

(i)                                     in the case of any Investor or Permitted
Transferee who is a natural person, such person’s spouse or children or
grandchildren (in each case, natural or adopted), or any trust for the sole
benefit of such person, such person’s spouse or children or grandchildren (in
each case, natural or adopted), or any corporation, partnership or limited
liability company in which the direct and beneficial owner of all of the equity
interest is such individual person or such person’s spouse or children or
grandchildren (in each case, natural or adopted);

 

3

 

(ii)                                  in the case of any Investor or Permitted
Transferee who is a natural person, the heirs, executors, administrators or
personal representatives upon the death of such person or upon the incompetency
or disability of such person for purposes of the protection and management of
such person’s assets;

 

(iii)                               (A)                              in the case of BRS, (I) any general partner of BRS (a “BRS Partner”)
and any corporation, partnership or other entity that is an Affiliate (as
hereinafter defined) of BRS or any BRS Partner (collectively, “BRS
Affiliates”), (II) any present or former managing director, director,
general partner, limited partner, officer or employee of BRS, a BRS Partner or
any BRS Affiliate, or any spouse or lineal descendant (natural or adopted),
sibling or parent of any of the foregoing persons in this clause (II) or any
heir, executor, administrator, testamentary trustee, legatee or beneficiary of
any of the foregoing persons described in this clause (II) (provided that no
BRS Affiliate that becomes such an entity primarily for the purpose of
effecting a transfer of Securities shall be considered a Permitted Transferee)
(collectively, “BRS Associates”), and (III) any trust, the beneficiaries
of which, or any charitable trust, the grantor of which, or any corporation,
limited liability company or partnership, the stockholders, members or general
and limited partners of which, include only BRS, BRS Partners, BRS Affiliates,
or BRS Associates;  provided, however,
that prior to the Company’s initial Public Offering (as such term is defined in
Section 4.1(b) hereof), no limited partner of BRS, BRS Partner or BRS Affiliate
shall constitute a Permitted Transferee to the extent that a Transfer of
Securities to such limited partner would cause the Company to be subject to
registration under Section 12(g) of the Securities Exchange Act of 1934, as
amended (the “Exchange Act”);

 

(B)                                in the case of any of the Jefferies Funds, (I)
the general partner or managing member of such Jefferies Fund (a “Jefferies
Partner”) and any corporation, partnership or other entity that is an
Affiliate (as hereinafter defined) of any of the Jefferies Funds or any
Jefferies Partner (including FS Private Investments LLC, the manager of the
Jefferies Funds) (collectively, “Jefferies Affiliates”), (II) any
present or former managing director, director, general partner, limited
partner, member, officer or employee of any of the Jefferies Funds, a Jefferies
Partner or any Jefferies Affiliate, or any spouse or lineal descendant (natural
or adopted), sibling or parent of any of the foregoing persons in this clause
(II) or any heir, executor, administrator, testamentary trustee, legatee or
beneficiary of any of the foregoing persons described in this clause (II)
(provided that no Jefferies Affiliate that becomes such an entity primarily for
the purpose of effecting a transfer of Securities shall be considered a
Permitted Transferee) (collectively, “Jefferies Associates”), and (C)
any trust, the beneficiaries of which, or any charitable trust, the grantor of
which, or any corporation, limited liability company or partnership, the
stockholders, members or general and limited partners of which, include only
Jefferies Funds, Jefferies Partners, Jefferies Affiliates, or Jefferies
Associates; provided, however, that prior to the Company’s
initial Public Offering, no limited partner of any of the Jefferies Funds,
Jefferies Partner, or Jefferies Affiliate shall constitute a Permitted
Transferee to the extent that a Transfer of Securities to such limited partner
would cause the Company to be subject to registration under Section 12(g) of
the Exchange Act.

 

4

 

(iv)                              in the case of any Investor or Permitted
Transferee, any person if such person takes such Securities pursuant to a sale
in connection with a Public Offering or following a Public Offering in open
market transactions or under Rule 144 under the Securities Act.

 

(c)                                  As used herein, “Affiliate” means, with
respect to any person, any person directly or indirectly controlling,
controlled by or under common control with such person.

 

1.2.                              Legend.  (a)  All Securities. 
Any certificates representing Securities shall bear the following legend
(in addition to any other legend required under applicable law):

 

THE
SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), OR THE SECURITIES LAWS OF ANY STATE
AND MAY NOT BE SOLD, TRANSFERRED, ASSIGNED OR OTHERWISE DISPOSED OF WITHOUT
REGISTRATION UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAWS
OR THE DELIVERY TO THE COMPANY OF AN OPINION OF COUNSEL, REASONABLY
SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED.

 

THE
SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO THE TERMS AND
CONDITIONS OF A SECURITIES HOLDERS AGREEMENT BY AND AMONG THE COMPANY AND THE
HOLDERS SPECIFIED THEREIN, AS AMENDED FROM TIME TO TIME (THE “SECURITIES
HOLDERS AGREEMENT”), A COPY OF WHICH AGREEMENT IS ON FILE AT THE PRINCIPAL
OFFICE OF THE COMPANY.  THE SALE,
TRANSFER, ASSIGNMENT OR OTHER DISPOSITION OF THE SECURITIES IS SUBJECT TO THE
TERMS OF SUCH AGREEMENT AND THE SECURITIES ARE TRANSFERABLE OR OTHERWISE
DISPOSABLE ONLY UPON PROOF OF COMPLIANCE THEREWITH.

 

(b)                                 Management Securities.  In addition
to the legends required by Section 1.2(a) above, the following legend shall
appear on certificates representing Management Securities (as defined in
Section 4.1 hereof); provided, however, that the Company’s
failure to cause certificates representing Management Securities to bear such
legend shall not affect the Company’s Purchase Option described in Section 4.3:

 

THE SECURITIES
REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO A PURCHASE OPTION OF THE
COMPANY APPLICABLE TO “MANAGEMENT SECURITIES” AS DESCRIBED IN THE SECURITIES
HOLDERS AGREEMENT, A COPY OF WHICH

 

5

 

AGREEMENT IS ON FILE AT
THE PRINCIPAL OFFICE OF THE COMPANY.

 

1.3.                              Notation.  A notation will be made in the
appropriate transfer records of the Company with respect to the restrictions on
transfer of the Securities referred to in this Agreement.

 

ARTICLE II

 

OTHER COVENANTS AND REPRESENTATIONS

 

2.1.                              Financial Statements and Other Information. 
(a) The Company shall deliver (or cause Sheridan to deliver) to BRS
(so long as BRS or its Permitted Transferees (other than Permitted Transferees
pursuant to Section 1.1(b)(iv)) own any Securities) and to each of the
Jefferies Funds (so long as such Jefferies Fund or its Permitted Transferees
(other than Permitted Transferees pursuant to Section 1.1(b)(iv)) own any
Securities):

 

(i)                                     as soon as available and in any event within 15
days after the end of each calendar month, consolidated balance sheets of the
Company and its subsidiaries and of Sheridan and its subsidiaries as of the end
of such calendar month, and consolidated statements of income and cash flows of
the Company and its subsidiaries and of Sheridan and its subsidiaries for the
calendar month then ended, shown in comparison to the budgeted amounts for the
same period and the same monthly period from the prior fiscal year, prepared in
conformity with United States generally accepted accounting principles applied
on a consistent basis, except as otherwise noted therein, and subject to the
absence of notes and to year-end adjustments;

 

(ii)                                  as soon as available and in any event within 45
days after the end of each of the first three quarters of each fiscal year of
the Company, consolidated balance sheets of the Company and its subsidiaries
and of Sheridan and its subsidiaries as of the end of such period, and
consolidated statements of income and cash flows of the Company and its
subsidiaries and of Sheridan and its subsidiaries for the period then ended,
shown in comparison to the budgeted amounts for the same period and the same
quarterly period from the prior fiscal year, prepared in conformity with United
States generally accepted accounting principles applied on a consistent basis,
except as otherwise noted therein, and subject to the absence of notes and to
year-end adjustments;

 

(iii)                               as soon as available and in any event within 90
days after the end of each fiscal year of the Company, a consolidated and
consolidating balance sheet of the Company and its subsidiaries and of Sheridan
and its subsidiaries as of the end of such year, and consolidated and
consolidating statements of income and cash flows of the Company and its
subsidiaries and of Sheridan and its subsidiaries for the year then ended
prepared in conformity with United States generally accepted accounting
principles applied on a consistent basis, except as otherwise noted therein,
together with an auditor’s report thereon of a firm of established national
reputation;

 

6

 

(iv)                              to the extent the Company or Sheridan is required
by law or pursuant to the terms of any outstanding indebtedness of the Company
to prepare such reports, any annual reports, quarterly reports and other
periodic reports pursuant to Section 13 or 15(d) of the Exchange Act, actually
prepared by the Company or Sheridan as soon as such reports are generally
available, together with any other documents the Company or Sheridan are
required to deliver to the holders of any such indebtedness;

 

(v)                                 prior
to the beginning of each fiscal year, an annual budget which has been approved
by the Board of Directors of the Company, prepared on a month by month basis
for the Company and its subsidiaries and
Sheridan and its subsidiaries for such fiscal year (displaying
anticipated statements of income and cash flow), and promptly upon preparation
thereof any other significant budgets prepared by the Company, and any
revisions of such annual or other budgets; and

 

(vi)                              such
other documents, reports, financial data and other information as BRS or the
Jefferies Funds may reasonably request.

 

(a)                                  Inspection and Access.  The
Company and its subsidiaries shall provide to BRS (so long as it or its
Permitted Transferees (other than Permitted Transferees pursuant to Section
1.1(b)(iv)) own any Securities) and each of the Jefferies Funds (so long as it
or its Permitted Transferees (other than Permitted Transferees pursuant to
Section 1.1(b)(iv)) own any Securities) true and correct copies of all
quarterly and annual financial reports of the Company and its subsidiaries and
Sheridan and its subsidiaries and budgets prepared by or on behalf of the
Company and its subsidiaries and Sheridan and its subsidiaries, and such other
documents, reports, financial data and other information as such party may reasonably
request.  The Company shall permit any
authorized representatives designated by each such party to visit and inspect
any of the properties of the Company and its subsidiaries (including Sheridan),
including its and their books of account (and to make copies and take extracts
therefrom), and to discuss its and their affairs, finances and accounts with
its and their officers and their current and prior independent public
accountants (and by this provision the Company authorizes such accountants to
discuss with such representatives the affairs, finances and accounts of the
Company and its subsidiaries, whether or not a representative of the Company is
present), all at such reasonable times and as often as such party may
reasonably request.

 

2.2.                              Sale of the Company.

 

(a)                                  So long as the Company has not consummated a
Public Offering, if the Required Holders (as defined hereinafter) approve the
sale of the Company, whether by merger, consolidation, sale of outstanding
capital stock, sale of all or substantially all of its assets or otherwise (any
of the foregoing, an “Approved Sale”), (i) each Investor and Permitted
Transferee will consent to, vote for and raise no objections against, and waive
dissenters and appraisal rights (if any) with respect to, the Approved Sale,
(ii) if the Approved Sale is structured as a sale of stock, each Investor and
Permitted Transferee will agree to sell and will be permitted to sell all of
such Investor’s or Permitted Transferee’s Common Stock and/or Preferred Stock
on the terms and conditions approved by the Required Holders, and (iii) if the
Approved Sale includes the

 

7

 

sale,
exchange, redemption, cancellation or other disposition of securities
convertible into or exchangeable for capital stock of the Company, or options,
warrants or other rights to purchase such capital stock or securities, each
Investor or Permitted Transferee will sell, exchange, redeem, agree to cancel
or otherwise dispose of such securities or options, warrants or other rights on
the terms and conditions approved by the Required Holders.  Each Investor and Permitted Transferee will
take all necessary and desirable actions in connection with the consummation of
an Approved Sale.  As used herein, the
term “Required Holders” means, as of any date, the holders of the
majority of the shares of Common Stock then owned by BRS and the holders of the
majority of the shares of Common Stock then held by the Jefferies Funds.

 

(b)                                 The obligations of each of the Investors and
Permitted Transferees with respect to an Approved Sale are subject to the
satisfaction of the conditions that: (i) upon the consummation of the Approved
Sale, all of the Investors and Permitted Transferees holding Common Stock will
receive the same form and amount of consideration per share of Common Stock, or
if any holder of Common Stock is given an option as to the form and amount of
consideration to be received in respect of Common Stock, all Investors and
Permitted Transferees holding Common Stock will be given the same option, (ii)
upon the consummation of the Approved Sale, all of the Investors and Permitted
Transferees holding Preferred Stock will receive the same form and amount of
consideration per share of Preferred Stock (it being understood, however, that
the amount of consideration per share of Preferred Stock may vary to reflect
the accrued and unpaid dividends thereon, to the extent different shares of
Preferred Stock have been outstanding for different periods of time), or if any
holder of Preferred Stock is given an option as to the form or amount of
consideration to be received in respect of Preferred Stock, all Investors and
Permitted Transferees holding Preferred Stock will be given the same option,
and (iii) in the case of a holder of any securities referred to in clause (iii)
of paragraph (a) above, (A) (I) in the event such Securities are vested, the
holder shall receive in such Approved Sale, unless otherwise provided in the
terms of any agreement or instrument governing or evidencing such security,
either (x) the same securities or other property that such holder would have
received if such holder had converted, exchanged or exercised such security
immediately prior to such Approved Sale (after taking into account the
conversion, exchange or exercise price applying to such Security and any
applicable tax obligations of the holder in connection with such conversion,
exchange or exercise) or (y) a security convertible or exchangeable for, or
option, warrant or right to purchase, capital stock or other securities of a
successor entity having substantially equivalent value, or (II) in the case
where such securities are not vested, unless otherwise provided in the terms of
any agreement or instrument governing or evidencing such security, such
securities shall be cancelled, or (B) such securities shall remain outstanding
following such Approved Sale.

 

(c)                                  Each Investor and Permitted Transferee
acknowledges that its or his or her pro rata share (based upon the number of
shares of Common Stock owned (or acquirable pursuant to options, warrants or
other rights to purchase Common Stock, or securities convertible into or
exchangeable for Common Stock) by such holder) of the aggregate proceeds of an
Approved Sale may be reduced by transaction expenses related to such Approved
Sale.

 

8

 

2.3.                              Tag-Along Rights.

 

(a)                                  (i) 
Except as otherwise provided in Section 2.3(a)(iii) below, no Seller (as
hereinafter defined) shall sell any shares of Common Stock in any transaction
or series of related transactions unless all “Holders” (as hereinafter
defined) are offered an equal opportunity to participate in such transaction or
transactions on a pro rata basis based on the number of shares of Common Stock
then owned by each Holder who elects to participate in such transaction or
transactions and, subject to paragraph (ii) below, on identical terms
(including amount and type of consideration paid).  For the avoidance of doubt, such participation on a pro rata
basis shall mean that such Holder shall be entitled to sell the number of
shares of Common Stock proposed to be sold by the Seller, multiplied by a
fraction, the numerator of which is the number of shares then owned by such
Holder and the denominator of which is the number of shares of outstanding
Common Stock.  If any Holder elects not
to participate in full or in part on a pro rata basis, the Seller may increase
the number of shares sold by it by the number of shares any such Holder elects
not to include pursuant to the terms hereof. 
As used in this Section 2.3, a “Seller” shall mean BRS or any of
the Jefferies Funds; “Holders” shall mean any Investor or any of their
Permitted Transferees (other than BRS (in the case where BRS is the Seller) or
the selling Jefferies Fund (in the case where a Jefferies Fund is the Seller)
and other than a Permitted Transferee by virtue of Section 1.1(b)(iv)).

 

(ii)                                  Prior to any sale of shares of Common Stock
subject to these provisions, the Seller shall notify the Company in writing of
the proposed sale.  Such notice (the “Seller’s
Notice”) shall set forth: (A) the number of shares of Common Stock subject
to the proposed sale, (B) the name and address of the proposed purchaser, and
(C) the proposed amount of consideration and terms and conditions of payment
offered by such proposed purchaser.  The
Company shall promptly, and in any event within 30 days of the Company’s
receipt of the Seller’s Notice, deliver or cause to be delivered the Seller’s
Notice to each Holder.  A Holder may
exercise the tag-along right by delivery of a written notice (the “Tag-Along
Notice”) to the Seller within 30 days of the date the Company delivered or
caused to be delivered the Seller’s Notice. 
The Tag-Along Notice shall state the number of shares of Common Stock
that the Holder proposes to include in the proposed sale, up to the maximum pro
rata share described above.  If a Holder
entitled to participate therein delivers a Tag-Along Notice, such holder shall
be obligated to sell that number of shares of Common Stock specified in the
Tag-Along Notice upon the same terms and conditions as those under which the
Seller is selling, conditioned upon and contemporaneously with completion of
the Seller’s sale of its shares of Common Stock.  If no Tag-Along Notice is received during the 30-day period
referred to above, the Seller shall have the right for a 120-day period to
effect the proposed sale of shares of Common Stock on terms and conditions no
more favorable to the Seller than those stated in the Seller’s Notice and in
accordance with the provisions of this Section 2.3.

 

(iii)                               Notwithstanding anything herein to the contrary,
a Seller may make any of the following Transfers without offering the Holders
the opportunity to participate: (A) Transfers by a Seller to any Permitted
Transferee, provided that the proposed Permitted Transferee (except a
Permitted Transferee by virtue of Section 1.1(b)(iv) hereof) agrees in

 

9

 

writing
to be bound by the provisions of this Agreement; (B) sales pursuant to an
effective registration statement under the Securities Act; and (C) sales in
connection with an Approved Sale.

 

(iv)                              Notwithstanding
anything herein to the contrary, no Seller shall be required to offer any
Holder other than BRS or any of the Jefferies Funds the opportunity to
participate in any transaction pursuant to this Section 2.3 unless such
transaction involves sales of Common Stock to any person other than a Permitted
Transferee that, together with any previous Transfers of Common Stock by BRS or
the Jefferies Funds to persons other than Permitted Transferees, aggregate
greater than 15% of the Common Stock then outstanding, and both BRS and any of
the Jefferies Funds are Sellers in such transactions.

 

(v)                                 Each Investor acknowledges for itself and its
transferees that BRS or any of the Jefferies Funds may grant in the future
tag-along rights relating to shares of Common Stock to other holders of Common
Stock and such holders will (A) have the same opportunity to participate in
sales by BRS or such Jefferies Fund as provided to the parties hereto, and (B)
be included in the calculation of the pro rata basis upon which Holders may
participate in a sale.

 

(vi)                              Each
of the parties hereto acknowledges that the Company (A) may issue Securities to
persons in the future and (B) has adopted an incentive compensation plan
pursuant to which employees of the Company or its subsidiaries or other persons
may be granted, subject to the terms of such plan, options to purchase Common
Stock or other Securities, and that such persons or participants may become
subject to this Agreement and may be “Holders” for purposes of this Section
2.3.

 

(vii)                           The tag-along obligations of
the Sellers provided under this Section 2.3 shall terminate upon the earlier of
(A) the consummation of a Public Offering, (B) as to BRS, the day after the
date on which BRS owns less than 5% of the outstanding Common Stock and (C) as
to the Jefferies Funds, the day after the date on which the Jefferies Funds
collectively own less than 5% of the outstanding Common Stock.  Upon the termination of such obligations,
the rights of Holders with respect thereto shall also terminate.

 

(viii)                        Notwithstanding the
requirements of this Section 2.3, a Seller may sell shares of Common Stock at
any time without complying with the requirements of the above provisions of
this Section 2.3 so long as the Seller deposits into escrow with an independent
third party at the time of the sale that amount of the consideration received
in the sale equal to the Escrow Amount. 
The “Escrow Amount” shall equal the amount of consideration as
all the Holders would have been entitled to receive if they had the opportunity
to participate in the sale on a pro rata basis, determined as if each Holder
(A) delivered a Tag-Along Notice to the Seller in the time period set forth in
Section 2.3(a)(ii) and (B) proposed to include all of its Securities which it
would have been entitled to include in the sale.  No later than the date of the sale, the Seller shall notify the
Company in writing of the proposed sale. 
Such notice (the “Escrow Notice”) shall set forth the information
required in the Seller’s Notice, and in addition, such notice shall state the
name of the escrow agent and the account number of the escrow account.

 

10

 

The Company shall
promptly, and in any event within 10 days, deliver or cause to be delivered the
Escrow Notice to each Holder.  A Holder
may exercise the tag-along right described in this clause (viii) by delivery to
the Seller, within 15 days of the date the Company delivered or caused to be
delivered the Escrow Notice, of (I) a written notice specifying the number of
shares of Common Stock it proposes to sell, and (II) the certificates representing
such shares of Common Stock, with transfer powers duly endorsed in blank.  Promptly after the expiration of the 15th
day after the Company has delivered or caused to be delivered the Escrow
Notice, (x) the Seller shall purchase that number of shares of Common Stock as
Seller would have been required to include in the sale had Seller complied with
the provisions of Section 2.3(a) (ii), (y) the Company shall cause to be
released from the escrow to the Holder from whom the Seller purchases shares of
Common Stock pursuant to clause (x) of this paragraph the applicable amount of
consideration due to such Holder together with any interest thereon, and (z)
all remaining funds and other consideration held in escrow shall be released to
the Seller.  If the Seller received
consideration other than cash in the sale, the Seller shall purchase the shares
of Common Stock tendered by paying to the Holders cash and non-cash
consideration in the same proportion as received by the Seller in the sale.

 

2.4.                              Preemptive Rights.  (a) Except for the issuance of Securities by the Company
(i) pursuant to a Public Offering, (ii) as consideration for the
acquisition of all or any substantial portion of the assets or all or any
portion of the capital stock of any person or that are otherwise issued in
connection with any merger or other business combination that is approved in
accordance with the requirements of Section 2.6 hereof, (iii) in any
transaction in respect of a Security that is available to all holders of such
Security on a pro rata basis, (iv) pursuant to the Company’s 2003 Stock-Based
Incentive Compensation Plan or any other management stock option plan approved
in accordance with the requirements Section 2.6 hereof, (v) to any employee or
director of the Company or any of its Subsidiaries, (vi) as a dividend on the
outstanding Common Stock or Preferred Stock, or (vii) with respect to which BRS
and the Jefferies Funds have waived their rights to purchase any Securities
pursuant to this Section 2.4, if, so long as the Company has not consummated a
Public Offering, the Company sells any Securities, the Company will offer to
sell to each of the Qualified Investors (as defined below) a pro rata portion
of the number of such Securities issued equal to the percentage determined by
dividing (x) the number of shares of Common Stock held by such Qualified
Investor on a fully-diluted basis, by (y) the number of shares of Common Stock
of the Company then outstanding on a fully-diluted basis.  Each Qualified Investor will be entitled to
purchase all or part of such Securities at the same price and on the same terms
as such Securities are sold by the Company pursuant to this Section 2.4.  As used in this Section 2.4, “Qualified
Investors” shall mean BRS, any of the Jefferies Funds and any Management
Investor that, pursuant to the Securities Purchase and Exchange Agreement, will
make an initial investment in the Company valued as of the date hereof at
$100,000 or greater.

 

(b)                                 The
Company will cause to be given to each of the Qualified Investors a written
notice setting forth the terms and conditions upon which such Qualified
Investor may purchase Securities from the Company pursuant to this Section 2.4
(the “Preemptive Notice”).  After
receiving a Preemptive Notice, a Qualified Investor may agree to purchase the
Securities

 

11

 

offered to such Qualified
Investor by the Company pursuant to this Section 2.4, on the date specified by
the Company in the Preemptive Notice, by delivery of a written notice to the
Company within 15 days of the date the Company delivered or caused to be
delivered the Preemptive Notice to the Qualified Investor (the “Preemptive
Reply”).

 

2.5.                              Corporate
Opportunity.  To the fullest extent permitted by any
applicable law, the doctrine of corporate opportunity, or any other analogous
doctrine, shall not apply with respect to BRS or any BRS Affiliates or any of
the Jefferies Funds or any Jefferies Affiliates or representatives (including
any directors of the Company designated by such persons).  In particular, (a) BRS and any of the
Jefferies Funds and their respective Affiliates shall have the right to engage
in business activities, whether or not in competition with the Company or its
subsidiaries or the Company’s or its subsidiaries’ business activities, without
consulting any other Investor, and (b) none of BRS or the Jefferies Funds shall
have any obligation to any other Investor with respect to any opportunity to
acquire property or make investments at any time.

 

2.6.                              Restrictive Covenants.  Notwithstanding anything to the contrary
contained elsewhere in this Agreement, without the prior written consent of the
Required Holders, the Company shall not, and shall cause each of its
subsidiaries not to:

 

(a)                                  except
in connection with an Approved Sale pursuant to Section 2.2 hereof, sell, lease
or otherwise dispose of, or permit any of its subsidiaries to sell, lease or
otherwise dispose of, any assets of the Company and/or its subsidiaries having,
in the aggregate, a value of $5 million or more (computed on the basis of book
value, determined in accordance with generally accepted accounting principles
consistently applied, or fair market value, determined by the Company’s Board
of Directors in its reasonable good faith judgment) in any transaction or
series of related transactions;

 

(b)                                 except
in connection with an Approved Sale pursuant to Section 2.2 hereof, merge or
consolidate with any person or, except as permitted by subparagraph (c) below,
permit any of the Company’s subsidiaries to merge or consolidate with any
person (other than any of the Company’s wholly-owned subsidiaries);

 

(c)                                  acquire,
or permit any of the Company’s subsidiaries to acquire, any interest in any
company or business (whether by a purchase of assets, purchase of stock, merger
or otherwise), or enter into any joint venture, involving an aggregate
consideration (including, without limitation, the assumption of liabilities
whether direct or indirect) exceeding $5 million in any one transaction or series
of related transactions or exceeding $15 million in the aggregate.

 

(d)                                 effect
an initial Public Offering of Securities of the Company, any of its
subsidiaries, or any successor entity of the Company or any of its
subsidiaries;

 

(e)                                  liquidate,
dissolve, declare or make any filing in bankruptcy or effect a recapitalization
or reorganization in any form of transaction (including, without limitation,
any reorganization of any of the Company or its subsidiaries into a limited
liability company, a

 

12

 

partnership or any other
non-corporate entity that is treated as a partnership for federal income tax
purposes);

 

(f)                                    create,
incur, assume or suffer to exist any indebtedness, or permit any of the
Company’s subsidiaries to create, incur, assume or suffer to exist any
indebtedness, exceeding an aggregate principal amount of $15.0 million (based
on outstanding indebtedness plus available facilities) at any time on a
consolidated basis;

 

(g)                                 issue
or sell any shares of the capital stock or other equity securities, or any
securities convertible or exchangeable for such securities, or warrants,
options, or other rights to acquire such stock or securities, of the Company or
any of its subsidiaries to any person other than the Company or any of its
wholly-owned subsidiaries, except for (i) issuances in connection with the
exercise of any warrants, options or other rights to acquire such equity
securities or shares of capital stock, so long as the initial issuance or sale
of such warrants, options or other rights was consented to in writing by the
Required Holders or (ii) any issuance of options (or shares issued upon
exercise thereof) under the Company’s 2003 Stock-Based Incentive Compensation
Plan or otherwise approved by the Board of Directors of the Company;

 

(h)                                 adopt
or approve any annual business plan or budget for the Company;

 

(i)                                     hire,
fire, remove or replace any member of the senior management of the Company or
Sheridan, who, if the Company or Sheridan were a publicly reporting company,
would be one of the top five individuals whose salaries would be required to be
disclosed in its Securities and Exchange Commission reporting documents;

 

(j)                                     enter
into, or permit any of its subsidiaries to enter into, the ownership, active
management or operation of any business other than the business of the Company
and its subsidiaries immediately following the closing of the transactions
contemplated by the Stock Purchase Agreement;

 

(k)                                  enter
into, amend, modify or supplement, or permit any subsidiary to enter into,
amend, modify or supplement, any agreement, transaction, commitment or
arrangement with any of its or any subsidiary’s officers, advisors, directors,
employees, stockholders, or Affiliates or with any individual related by blood,
marriage or adoption to any such individual or with any entity in which any
such person or individual owns a beneficial interest, except for customary
employment arrangements and benefit programs on reasonable terms approved by
the Board of Directors of the Company;

 

(l)                                     amend,
modify or supplement the Amended and Restated Certificate of Incorporation,
Bylaws or any of the other organizational documents, or any other material
agreements, of the Company or any of its subsidiaries; or

 

(m)                               enter
into any agreement, contract, commitment or arrangement that if completed or
performed would be in contravention of any of the foregoing.

 

13

 

ARTICLE III

 

CORPORATE ACTIONS

 

3.1.                              Amended
and Restated Certificate of Incorporation and Bylaws.  Each
Investor has reviewed the Amended and Restated Certificate of Incorporation and
Bylaws of the Company in the forms attached hereto as Exhibits A and B,
respectively, and hereby approves and ratifies the same.

 

3.2.                              Directors
and Voting Agreements.

 

(a)                                  Each Investor and Permitted Transferee agrees
that it shall take, at any time and from time to time, all action necessary
(including voting the Common Stock entitled to vote owned by him, her or it,
calling special meetings of stockholders and executing and delivering written
consents) to ensure that the Board of Directors of the Company is composed at
all times of ten individuals as follows: (i) four individuals designated by BRS
(who shall initially be Thomas J. Baldwin, Gary T. DiCamillo, J. Rice Edmonds
and Nicholas R. Sheppard) (collectively, the “BRS Directors”), (ii) four
individuals designated by ING Furman Selz, on behalf of itself and the other
Jefferies Funds (who shall initially be Nicholas Daraviras, Craig H. Deery,
James L. Luikart and George A. Whaling) (the “Jefferies Directors”), and
(iii) two individuals who are designated jointly by BRS and ING Furman Selz (on
behalf of the Jefferies Funds) (who shall initially be J. M. Dryden Hall, Jr.
and John A. Saxton) (the “Jointly Designated Directors”).  It is understood and agreed that the
designation of each Jointly Designated Director shall require the consent of
each of BRS and ING Furman Selz.

 

(b)                                 Each Investor and Permitted Transferee agrees to
take all necessary action to cause the composition of the Board of Directors of
the Company to remain in accordance with Section 3.2(a) hereof (including,
without limitation, voting or causing to vote or acting by written consent with
respect to, all shares of Common Stock entitled to vote thereon or any other
voting capital stock of the Company now or hereafter owned or held by such
Investor or Permitted Transferee in favor of such persons) and to act itself
(if a member of the Board of Directors) or cause its designee (if any) on the
Board of Directors to vote or act by written consent to cause the Board of
Directors of the Company to be in accordance with Section 3.2(a) hereof.

 

(c)                                  Any
of the rights to designate directors of the Company of BRS set forth in
paragraph (a) above shall terminate on such date as the BRS, together with
their respective Affiliates and Permitted Transferees, collectively own less
than 5% of the outstanding Common Stock. 
Likewise, any of the rights to designate directors of the Company of any
of the Jefferies Funds set forth in paragraph (a) above shall terminate on such
date as the Jefferies Funds, together with their respective Affiliates and
Permitted Transferees, collectively own less than 5% of the outstanding Common
Stock.

 

3.3.                              Right
to Remove Certain of the Company’s Directors.  Each of
BRS and ING Furman Selz (on behalf of the Jefferies Funds) may request that any
director subject to

 

14

 

designation
by it be removed (with or without cause) by written notice to the other
Investors, and, in any such event, each Investor and Permitted Transferee shall
promptly consent in writing or vote or cause to be voted all shares of Common
Stock entitled to vote thereon now or hereafter owned or controlled by it for
the removal of such person as a director. 
BRS and ING Furman Selz (on behalf of the Jefferies Funds) jointly may
request that any Jointly Designated Director be removed (with or without cause)
by written notice to the other Investors, and, in any such event, each Investor
and Permitted Transferee shall promptly consent in writing or vote or cause to
be voted all shares of Common Stock entitled to vote thereon now or hereafter
owned or controlled by it for the removal of such Jointly Designated Director
as a director.

 

3.4.                              Right
to Fill Certain Vacancies in Company’s Board.  In the
event that a vacancy is created on the Company’s Board of Directors at any time
by the death, disability, retirement, resignation or removal (with or without
cause) of a BRS Director, a Jefferies Director or a Jointly Designated
Director, or if otherwise there shall exist or occur any vacancy on the
Company’s Board of Directors of a BRS Director, a Jefferies Director or a
Jointly Designated Director, such vacancy shall not be filled by the remaining
members of the Company’s Board of Directors, but each Investor and Permitted
Transferee hereby agrees promptly to consent in writing or vote or cause to be
voted all shares of Common Stock entitled to vote thereon or any other voting
capital stock of the Company now or hereafter owned or controlled by it to
elect that individual designated to fill such vacancy and serve as a director,
as shall be designated by the Investor or Investors then entitled to designate
such director under Section 3.2 hereof.

 

3.5.                              Directors
of Subsidiaries.  The Company shall cause the Board of
Directors of Sheridan to be identical to the Board of Directors of the
Company.  In addition, if requested by
BRS or any of the Jefferies Funds (so long as the requesting party, together
with its respective Affiliates or Permitted Transferees, owns not less than 5%
of the outstanding Common Stock) the Company shall take, and each of the
Investors and Permitted Transferees agrees that it shall cause the Company to
take, at any time and from time to time, all action necessary (including voting
all shares of capital stock or other voting equity interests of any subsidiary
owned by the Company, calling special meetings of stockholders and executing
and delivering written consents) to ensure that the Board of Directors of any
other Subsidiary (as defined in Section 4.1) is identical to the Board of
Directors of the Company.

 

3.6.                              Amendment
of Certificate and Bylaws.  Each Investor and Permitted Transferee
agrees that it shall not consent in writing or vote or cause to be voted any
shares of Common Stock now or hereafter owned or controlled by it in favor of
any amendment, repeal, modification, alteration or rescission of, or the
adoption of any provision in the Company’s Amended and Restated Certificate of
Incorporation or Bylaws inconsistent with Article III of this Agreement unless
BRS and the Jefferies Funds consent in writing thereto.

 

3.7.                              Termination
of Voting Agreements.  If not earlier terminated under Section 3.2,
the voting agreements in Sections 3.2, 3.3, 3.4, 3.5 and 3.6 hereof shall
terminate on the date the Company consummates a Public Offering (if requested
by the underwriter with respect to such offering).

 

15

 

3.8.                              Officers.  Each Investor approves the
election of such officers as may be elected or appointed by the Company or its
Board of Directors.

 

3.9.                              Committees. 
BRS and the Jefferies Funds each have the right to appoint not less than
one director to any committee of the Board of Directors.

 

ARTICLE IV

 

ADDITIONAL RESTRICTIONS ON TRANSFERS OF

MANAGEMENT SECURITIES HELD BY MANAGEMENT INVESTORS

 

4.1.                              Certain
Definitions.  The terms defined below shall have the
following meanings when used in this Article IV:

 

(a)                                  “Management Securities” means the shares
of Preferred Stock or Common Stock or other Securities now or hereafter owned
by a Management Investor, and all other securities of the Company (or a
successor to the Company) received on account of ownership of the Management
Securities, including any and all management securities issued in connection
with any merger, consolidation, stock dividend, stock distribution, stock
split, reverse stock split, stock combination, recapitalization,
reclassification, subdivision, conversion or similar transaction in respect
thereof.

 

(b)                                 “Public Offering” means a successfully
completed firm commitment underwritten public offering pursuant to an effective
registration statement under the Securities Act (other than a Special
Registration Statement) in respect of the offer and sale of shares of Common
Stock for the account of the Company resulting in aggregate net proceeds to the
Company and any stockholder selling shares of Common Stock in such offering of
not less than $50,000,000.

 

(c)                                  “Special
Registration Statement” means (i) a registration statement on Form S-8 or
S-4 or any similar or successor form or any other registration statement
relating to an exchange offer or an offering of securities solely to the
Company’s employees or security holders or to security holders of a corporation
or other entity being acquired by, or merged with, the Company or (ii) a
registration statement registering a Unit Offering;

 

(d)                                 “Subsidiary”
means a corporation, partnership, limited liability or other business entity
with respect to which the Company (or another Subsidiary) owns 50% or more of
the total combined voting power of all classes of stock (or other voting
interests).

 

(e)                                  “Unit
Offering” means a public offering of a combination of debt and equity
securities of the Company in which (i) not more than 10% of the gross proceeds
received from the sale of such securities is attributed to such equity
securities, and (ii) after giving effect to such offering, the Company does not
have a class of equity securities required to be registered under the Exchange
Act.

 

16

 

4.2.                              Restrictions
on Transfer.  In addition to the restrictions imposed by
Section 1.1 hereof, and notwithstanding anything to the contrary contained
herein, none of the Management Investors (it being understood that, any
reference to a Management Investor in this Article IV as a holder of Management
Securities shall also include such Management Investor’s heirs, executors, administrators,
transferees, successors and assigns, as the case may be) shall effect a
Transfer of any Management Securities other than (a) pursuant to Section 2.2
hereof in connection with an Approved Sale, (b) pursuant to Section 4.3 hereof
in connection with an exercise of the Purchase Option (as such term is
hereinafter defined), (c) with the consent of the Company (as evidenced by a
resolution duly adopted by at least a majority of the non-employee members of
the Company’s Board of Directors) and the Required Holders, (d) to a Permitted
Transferee of such Management Investor in question or (e) in connection with a
Public Offering in which such Management Investor is permitted to
participate.  In exercising the consent
and approval provided for in clause (c), each of the Company and the Required
Holders may employ their sole discretion in evaluating the nature of the
proposed transferee and each of the Company and the Required Holders may impose
such conditions on Transfer as they deem appropriate in their sole discretion,
including, but not limited to, requirements that the transferee be an employee
or director of the Company or a Subsidiary and that the transferee purchase
such Management Investor’s Management Securities as a “Management Investor”
subject to the restrictions of this Article IV.  In the event any Transfer is authorized pursuant to clause (c)
above to an employee or director of the Company or a majority-owned direct or
indirect subsidiary of the Company as a “Management Investor,” such employee or
director shall execute an agreement, in form and substance reasonably
satisfactory to the Company, pursuant to which such employee or director shall
agree to be bound by the terms and conditions of this Agreement, and such other
provisions as the Company may determine, and upon such execution, such employee
or director shall be entitled to the benefit of such provisions hereof and such
other provisions as the Company determines and are set forth in such
agreement.  Any purported Transfer in
violation of this Agreement shall be null and void and of no force and effect,
and the purported transferees shall have no rights or privileges in or with
respect to the Company.  Notwithstanding
the foregoing provisions, each Management Investor agrees that he or she will
not effect a Transfer of any Management Securities prior to the lapse of such
period of time following acquisition thereof as may be required to comply with
applicable securities laws.

 

For the purposes of this Agreement, the “Permitted
Transferees” of any of the Management Investors shall be as set forth in
Section 1.1(b)(i) or (ii) hereof; provided, however, that as a
condition to a Transfer to any Permitted Transferee, such Permitted Transferee
shall agree, in writing and in form and substance reasonably satisfactory to
the Company, to become bound, and thereby shall become bound, by all the terms
of this Agreement applicable to the Management Investor transferring such
Management Securities.  The Termination
Date (as hereinafter defined) for a Permitted Transferee shall be the
Termination Date with respect to the Management Investor who first acquired the
Management Securities held by such Permitted Transferee pursuant to this
Agreement.

 

17

 

4.3.                              Purchase Option.

 

(a)                                  General Terms.  In the event that any
Management Investor who is an employee of the Company or a Subsidiary shall
cease to be employed by the Company or a Subsidiary for any reason (including,
but not limited to, death, temporary or permanent disability, retirement at age
65 or more under normal retirement policies, resignation or termination by the
Company or a Subsidiary) or any Management Investor who is a director shall
cease to serve as a member of the Board of Directors of the Company or a
Subsidiary for any reason (including, but not limited to, death, resignation or
removal), other than by reason of a leave of absence approved by the Company or
a Subsidiary, such Management Investor (or his or her heirs, executors,
administrators, transferees, successors or assigns) shall give prompt notice to
the Company of such termination or cessation of service (except in the case of
termination of employment or service by the Company or a Subsidiary, in which
case no notice need be given), and the Company or one or more designee(s)
selected by the Required Holders (a “Designated Purchaser”), shall have
the right and option by written notice given at any time, within 180 days after
the later of the effective date of such termination of employment or cessation
of service (the “Termination Date”) or the date of the Company’s receipt
of the aforesaid notice (the later of such dates, the “Option Termination
Date”), to purchase from such Management Investor and his or her Permitted
Transferees, or his or her heirs, executors, administrators, transferees,
successors or assigns, as the case may be, any or all of the Management
Securities then owned by such Management Investor (and his or her Permitted
Transferees), at a purchase price equal to the Option Purchase Price (as
hereinafter defined).  The right of the
Company and the Company’s designee(s) set forth in this Section 4.3 to purchase
a terminated Management Investor’s Management Securities is hereinafter referred
to as the “Purchase Option”.

 

(i)                                     Exercise of Purchase Option.  The
Purchase Option shall be exercised by written notice to the Management Investor
(or his or her heirs, executors, administrators, transferees, successors or
assigns, as the case may be) executed by the Company or the Designated
Purchaser, as the case may be, given at any time not later than the Option
Termination Date.  Such notice shall set
forth the number and type of Management Securities desired to be purchased and
shall set forth a time and place of closing which shall be no earlier than 10
days and no later than 60 days after the date such notice is sent.  At such closing, the seller shall deliver,
or cause to be delivered, the certificates evidencing the number of Management
Securities to be purchased by the Company and/or its Designated Purchaser,
accompanied by stock powers duly endorsed in blank or duly executed instruments
of transfer, and any other documents that are necessary to transfer to the
Company and/or its Designated Purchaser, as the case may be, good title to such
of the Management Securities to be transferred, free and clear of all pledges,
security interests, liens, charges, encumbrances, equities, claims and options
of whatever nature, other than those imposed under this Agreement, and
concurrently with such delivery, the Company and/or its Designated Purchaser,
as the case may be, shall deliver to the seller the full amount of the Option
Purchase Price (or the portion thereof to be paid by such party) for such
Management Securities in cash by certified or bank cashier’s check.

 

18

 

(ii)                                  Option Purchase Price.  The “Option
Purchase Price” for the Management Securities to be purchased from such
Management Investor, and his or her Permitted Transferees, or his or her heirs,
executors, administrators, transferees, successors and assigns, pursuant to the
Purchase Option (the number of Management Securities to be so purchased being
the “Purchase Number”) shall equal the Fair Market Value Price
multiplied by the Purchase Number.

 

As used herein:

 

(A)                              “Fair Market Value Price” for each share
of Common Stock or Preferred Stock (or option to purchase Common Stock) means, the
amount determined as follows:  the
average of the high and low sales prices per share of Preferred Stock or Common
Stock (or their equivalent) as reported either on the National Association of
Security Dealers, Inc. Automated Quotation System (“NASDAQ”) or the New
York Stock Exchange (“NYSE”) for the five business days immediately
preceding the Termination Date or, if not reported on the NASDAQ or NYSE, a
valuation based upon the price that would be paid for the shares of Preferred
Stock and Common Stock in an acquisition of all outstanding shares of capital
stock of the Company on a stand alone basis in a privately negotiated arm’s
length transaction between a willing seller under no compulsion to sell and a
willing buyer under no compulsion to buy, (I) without regard to the
restrictions upon transfer of Securities contained in this Agreement or in any
other agreement, (II) without regard to any discount for illiquidity, or
other factors affecting the transferability of any of the capital stock of the
Company, if applicable, (III) taking into account the aggregate amount of the
Company’s indebtedness for borrowed money (including all acquisition and
working capital indebtedness incurred by the Company after the date hereof),
(IV) taking into account the aggregate amount payable in respect of the
liquidation preference of any capital stock of the Company having a liquidation
preference senior to Common Stock, and (V) taking into account the aggregate
amount payable in respect of any accrued and unpaid dividends on any capital
stock of the Company whose holders have rights to dividends that are senior to
the rights of holders of Common Stock (the valuation hereinafter referred to as
the “Proffered Valuation”).  If
the Company or its Designated Purchaser is considering exercising the Purchase
Option, then within 60 days after the Termination Date, the Company or the
Designated Purchaser, as the case may be, shall prepare and deliver to the
Management Investor its calculation of the Fair Market Value Price per share
and, if applicable, the Company’s or its Designated Purchaser’s Proffered
Valuation.  If the Management Investor
does not agree with the Company’s or its Designated Purchaser’s Proffered
Valuation and the Company or its Designated Purchaser and the Management
Investor are unable to agree on the Fair Market Value Price per share within
ten days after delivery of the Company’s or its Designated Purchaser’s
Proffered Valuation, then the Management Investor shall prepare his own
Proffered Valuation, a copy of which shall be delivered to the Company or its
Designated Purchaser within 20 days after delivery of the Company’s or its
Designated Purchaser’s Proffered Valuation, as the case may be.  The parties shall then select a mutually
acceptable investment banking or other firm to choose either the Company’s or its
Designated Purchaser’s Proffered Valuation, or the Management Investor’s
Proffered Valuation.  Such firm (x)
shall not be an Affiliate of the Company or the Management Investor; and (y)
shall have demonstrable skills and expertise in

 

19

 

the valuation of equity
securities in relevant industries.  If
the parties are unable to agree on a mutually acceptable investment banking or
other firm within ten days after delivery of the Management Investor’s Proffered
Valuation, each party shall select its own investment banking or other firm and
the two selected firms shall select a mutually acceptable investment banking or
other firm (meeting the criteria set forth in the preceding sentence) for the
purpose of determining the Fair Market Value Price per share.  If either party fails to select its own
investment banking or other firm, which is to select the determining firm,
within five days after the expiration of such ten day period, the other party’s
selected firm shall act as the determining firm.  The determination of an investment banking or other firm will be
set forth in writing and will be conclusive and binding on the parties.  The parties shall instruct the selected firm
to select, within 20 days thereafter, such of the two Proffered Valuations as more
accurately reflects the Fair Market Value Price per share, and the Company or
its Designated Purchaser and the Management Investor hereby agrees to be bound
by such decision.  The fees and expenses
of the determining firm shall be borne by the party whose Proffered Valuation
was not selected by the investment banking or other firm.  The Company or its Designated Purchaser and
the Management Investor shall be responsible for their own fees and expenses,
including the fees and expenses of their respective counsel and, if applicable,
their own investment banking or other firm. 
Notwithstanding anything to the
contrary contained herein, the termination of the exercise period set forth in
this Section 4.3 shall be tolled during the pendency of and until ten days
following the conclusion of any negotiation or arbitration of the Fair Market
Value Price.  In the event of
such negotiation or arbitration of the Fair Market Value Price, the Company or
its Designated Purchaser shall have the right to revoke any notice of exercise
of the Purchase Option previously given by such party.  Notwithstanding the foregoing,
the parties agree that in the case of any security convertible into or
exchangeable for Common Stock or option, warrant or other right to purchase
Common Stock, the Fair Market Value Price for such security shall be based upon
the Fair Market Value Price of the underlying Common Stock, after taking into
account the conversion exchange or exercise price applying to such security and
any applicable tax obligations of the holder in connection with such
conversion, exercise or exchange.

 

(b)                                 Right of First Refusal.  In the
event that, after receiving the consent of the Company and the Required Holders
as required by Section 4.2 hereof, on or prior to the Company’s initial Public
Offering, any Management Investor proposes to sell any or all of such
Management Investor’s Management Securities, such Management Investor shall do
so only pursuant to a bona fide written offer from an unaffiliated third party.  Prior to accepting such offer, the
Management Investor will first offer to sell such Management Securities to the
Company pursuant to this Section 4.3(b).

 

Such Management Investor shall deliver a written
notice of any such bona fide offer (a “Sale Notice”) to the Company
describing in reasonable detail the Management Securities proposed to be sold,
the name of the transferee, the purchase price and all other material terms of
the proposed Transfer.  Upon receipt of
the Sale Notice, the Company, or one or more designee(s) selected by a majority
of the non-employee members of the Board of Directors of the Company, shall
have the right and option to purchase all, but not less than all, of the
Management Securities proposed to be sold by the Management Investor at the price
and on

 

20

 

the terms of the proposed Transfer set forth in the Sale Notice.  Within 30 days after receipt of the Sale
Notice, the Company shall notify such Management Investor whether or not it or
its designee wishes to purchase all of the offered Management Securities.  In any case where non-fungible property such
as real estate constitutes part of the purchase price included in the bona fide
offer or where any aspect of the terms of such offer depend on the unique
attributes of the proposed transferee or otherwise cannot be precisely and
reasonably duplicated by someone other than such transferee, purchases by the
Company or its designee(s) shall be made on terms that constitute the
reasonable economic equivalent of the price and terms of such bona fide
offer.  If the Company or its
designee(s) elects to purchase the offered Management Securities, the closing
of the purchase and sale of such Management Securities shall be held at the
place and on the date established by the buyer in its notice to such Management
Investor in response to the Sale Notice, which in no event shall be less than
10 or more than 60 days from the date of such notice.

 

In the event that the Company or its designee does not
elect to purchase all the offered Management Securities, such Management
Investor may, subject to the other provisions of this Agreement, sell the
offered Management Securities to the transferee specified in the Sale Notice at
a price no less than the price specified in the Sale Notice and on other terms
no more favorable to the transferee(s) thereof than specified in the Sale
Notice during the 180-day period immediately following the last date on which
the Company or its designee could have elected to purchase the offered
Management Securities; provided, however, that no such sale shall
be made unless the transferee executes and delivers a joinder to this Agreement
satisfactory in form and substance to the Company which joinder states that
such transferee agrees to be fully bound by this Agreement as if it were a
party hereto.  Any such Management
Securities not transferred within such 180-day period will be subject to the
provisions of this Section 4.3(b) upon subsequent Transfer.

 

4.4.                              Involuntary
Transfers.  In the event that the Management Securities
owned by any Management Investor shall be subject to sale or other Transfer
(the date of such sale or transfer shall hereinafter be referred to as the “Transfer
Date”) by reason of (i) bankruptcy or insolvency proceedings, whether
voluntary or involuntary, or (ii) distraint, levy, execution or other
involuntary Transfer, then such Management Investor shall give the Company
written notice thereof promptly upon the occurrence of such event stating the
terms of such proposed Transfer, the identity of the proposed transferee, the
price or other consideration, if readily determinable, for which the Management
Securities are proposed to be transferred, and the number of Management
Securities to be transferred.  After its
receipt of such notice or, failing such receipt, after the Company otherwise
obtains actual knowledge of such a proposed Transfer, the Company or one or
more designee(s) selected by a majority of the non-employee members of the
Board of Directors of the Company shall have the right and option to purchase
any or all of such Management Securities which right shall be exercised by
written notice given by the Company (or its designee) to such proposed
transferor within 60 days following the Company’s receipt of such notice or,
failing such receipt, the Company’s obtaining actual knowledge of such proposed
Transfer.  Any purchase pursuant to this
Section 4.4 shall be at the price and on the terms applicable to such proposed
Transfer.  If the nature of the event giving
rise to such involuntary

 

21

 

Transfer
is such that no readily determinable consideration is to be paid for the
Transfer of the Management Securities, the price to be paid by the buyer shall
be the Option Purchase Price that would have been applicable hereunder had such
Management Investor incurred a Termination Date as of the date of such proposed
Transfer for the Management Securities. 
The closing of the purchase and sale of Management Securities shall be
held at the place and the date to be established by the buyer, which in no
event shall be less than 10 or more than 60 days from the date on which the
buyer gives notice of its election to purchase the Management Securities.  At such closing, such Management Investor
shall deliver the certificates evidencing the number of Management Securities
to be purchased by the buyer, accompanied by stock powers duly endorsed in
blank or duly executed instruments of transfer, and any other documents that
are necessary to transfer to the buyer good title to such of the securities to
be transferred, free and clear of all pledges, security interests, liens,
charges, encumbrances, equities, claims and options of whatever nature other
than those imposed under this Agreement, and concurrently with such delivery,
the buyer shall deliver to such Management Investor the full amount of the
purchase price for such Management Securities in cash by certified or bank
cashier’s check.

 

4.5.                              Purchaser
Representative.  If the Company or any Investor enters into
any negotiation or transaction for which Rule 506 (or any similar rule then in
effect) promulgated by the Securities and Exchange Commission under the
Securities Act may be available with respect to such negotiation or transaction
(including a merger, consolidation or other reorganization), each of the
Management Investors will, at the request of the Company, appoint a purchaser
representative (as such term is defined in Rule 501(h) promulgated by the
Securities and Exchange Commission under the Securities Act) reasonably
acceptable to the Company.  If each of
the Management Investors appoints the purchaser representative designated by
the Company, the Company will pay the fees of such purchaser representative,
but if a Management Investor declines to appoint the purchaser representative
designated by the Company, such Management Investor will appoint another
purchaser representative (reasonably acceptable to the Company), and such
Management Investor will be responsible for the fees of the purchaser
representative so appointed.

 

ARTICLE V

 

MISCELLANEOUS

 

5.1.                              Amendment
and Modification.  This Agreement may be amended or modified,
or any provision hereof may be waived, provided that such amendment,
modification or waiver is set forth in a writing executed by the Company and
the Required Holders; provided, however, that any amendment of
this Agreement which materially adversely affects any Investor in a manner
materially different from other Investors (other than due to any difference in
the number of shares owned by any such Investor) shall require the prior
written consent of such Investor.  No
course of dealing between or among any persons having any interest in this
Agreement will be deemed effective to modify, amend or discharge any part of
this Agreement or any rights or obligations of any person under or by reason of
this Agreement.

 

22

 

5.2.                              Successors and
Assigns.  This Agreement shall be binding upon and
inure to the benefit of and be enforceable by the successors and permitted
assigns and executors, administrators and heirs of each party hereto.  Except as contemplated hereby in connection
with Transfers of Securities, this Agreement, and any rights or obligations
existing hereunder, may not be assigned or otherwise transferred by any party
without the prior written consent of the other parties hereto.

 

5.3.                              Separability.  In the
event that any provision of this Agreement or the application of any provision
hereof is declared to be illegal, invalid or otherwise unenforceable by a court
of competent jurisdiction, the remaining provisions shall remain in full force
and effect unless deletion of such provision causes this Agreement to become
materially adverse to any party, in which event the parties shall use
reasonable efforts to arrive at an accommodation which best preserves for the
parties the benefits and obligations of the offending provision.

 

5.4.                              Notices.  All notices provided for or
permitted hereunder shall be made in writing by hand-delivery, registered or
certified first-class mail, fax or reputable courier guaranteeing overnight
delivery to the other party at the following addresses (or at such other
address as shall be given in writing by any party to the others):

 

If
to the Company, to:

 

TSG
Holdings Corp.

11311 McCormick Road

Suite 260

Hunt Valley, MD  21031-1437

Attention: 
John A. Saxton

Fax: 
(410) 785-7217

 

with
a required copy to:

 

Dechert
LLP

4000 Bell Atlantic Tower

1717 Arch Street

Philadelphia, PA 19103

	
  Attention:

  	
  Carmen
  J. Romano, Esq.

  
	
   

  	
  David
  S. Denious, Esq.

  

 

Fax:  (215) 994-2222

 

If
to BRS, to:

 

c/o
Bruckmann, Rosser, Sherrill & Co., L.P.

126 East 56th Street, 29th
Floor

New York, NY 10022

Attention: 
Harold O. Rosser, II

Fax: 
(212) 521-3799

 

23

 

with a required copy to:

 

Dechert LLP

4000 Bell Atlantic Tower

1717 Arch Street

Philadelphia, PA 19103

	
  Attention:

  	
  Carmen
  J. Romano, Esq.

  
	
   

  	
  David
  S. Denious, Esq.

  

Fax:  (215)
994-2222

 

If to any of the Jefferies Funds, to:

 

c/o
Jefferies Capital Partners

520 Madison Avenue

8th Floor

New York, NY  10022

Attention:  James Luikart

Fax:  (212) 284-1717

 

with a required copy to:

 

Dechert LLP

4000 Bell Atlantic Tower

1717 Arch Street

Philadelphia, PA 19103

	
  Attention:

  	
  Carmen
  J. Romano, Esq.

  
	
   

  	
  David
  S. Denious, Esq.

  

Fax:  (215)
994-2222

 

If to any of the
Management Investors, to such Management Investor’s address as set forth on the
signature page hereto or such other address as may be specified from time to
time in writing to the Company by any Management Investor.

 

All such notices shall be
deemed to have been duly given: when delivered by hand, if personally
delivered; four business days after being deposited in the mail, postage
prepaid, if mailed; when confirmation of transmission is received, if faxed
during normal business hours (or, if not faxed during normal business hours,
the next business day after confirmation of transmission); and on the next
business day, if timely delivered to a reputable courier guaranteeing overnight
delivery.

 

5.5.                              Governing Law.  This
Agreement shall be governed by and construed in accordance with the internal
laws of the State of Delaware, without giving effect to principles of conflicts
of law.

 

24

 

5.6.                              Headings.  The headings preceding the text
of the sections and subsections of this Agreement are for convenience of
reference only and shall not constitute a part of this Agreement, nor shall
they affect its meaning, construction or effect.

 

5.7.                              Counterparts.  This
Agreement may be executed in two or more counterparts and by the parties hereto
in separate counterparts, each of which when so executed shall be deemed to be
an original, and all of which taken together shall constitute one and the same
instrument.

 

5.8.                              Further
Assurances.  Each party shall cooperate and take such
action as may be reasonably requested by another party in order to carry out
the provisions and purposes of this Agreement and the transactions contemplated
hereby.

 

5.9.                              Termination.  This Agreement shall terminate
on the written agreement of the Investors who are parties hereto or when all
the Investors except any one Investor no longer hold any Securities.

 

5.10.                        Remedies.  In the event of a breach or a
threatened breach by any party to this Agreement of its obligations under this
Agreement, any party injured or to be injured by such breach, in addition to
being entitled to exercise all rights granted by law, including recovery of
damages, will be entitled to specific performance of its rights under this
Agreement.  The parties agree that the
provisions of this Agreement shall be specifically enforceable, it being agreed
by the parties that the remedy at law, including monetary damages, for breach
of such provision will be inadequate compensation for any loss and that any
defense in any action for specific performance that a remedy at law would be
adequate is waived.

 

5.11.                        Party
No Longer Owning Securities.  If a party hereto ceases to own any
Securities, such party will no longer be deemed to be an Investor or Management
Investor for purposes of this Agreement.

 

5.12.                        No Effect on Employment.  Nothing
herein contained shall confer on the Management Investor the right to remain in
the employ or service of the Company or any of its subsidiaries or Affiliates.

 

5.13.                        Pronouns.  Whenever the context may
require, any pronouns used herein shall be deemed also to include the
corresponding neuter, masculine or feminine forms.

 

5.14.                        Future Individual Investors.  The parties hereto agree that any current or
future employee of the Company or other person who purchases Securities from
the Company subsequent to the date hereof may become a signatory to this
Agreement by executing a written instrument setting forth that such person agrees
to be bound by the terms and conditions of this Agreement and this Agreement
will be deemed to be amended to include such person as a Management Investor
(or Investor, as the case may be) and the number of Securities purchased by him
or her.

 

25

 

5.15.                        Entire Agreement.  This
Agreement sets forth the entire agreement and understanding among the parties
and supersedes all prior agreements and understandings, written or oral,
relating to the subject matter of this Agreement, it being understood the
Investors are contemporaneously entering into other agreements and instruments
in connection with the consummation of the Acquisition, including the
Securities Purchase Agreement, Securities Purchase and Exchange Agreement and
the Registration Rights Agreement.

 

26

 

IN WITNESS WHEREOF, the
parties hereto have executed this Securities Holders Agreement the day and year
first above written.

 

	
   

  	
  TSG HOLDINGS CORP.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. Rice Edmonds

  	
   

  
	
   

  	
   

  	
  Name: J. Rice Edmonds

  
	
   

  	
   

  	
  Title: Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BRUCKMANN, ROSSER,
  SHERRILL & CO. II, L.P.   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  BRSE L.L.C., its
  general partner

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Thomas Baldwin

  	
   

  
	
   

  	
   

  	
  Name: Thomas Baldwin

  
	
   

  	
   

  	
  Title: Managing Director

  
						

 

27

 

	
   

  	
  ING FURMAN SELZ
  INVESTORS III L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  ING FURMAN SELZ
  INVESTMENTS III LLC,

  its General Partner

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ James Luikart

  	
   

  
	
   

  	
   

  	
  Name: James Luikart

  
	
   

  	
   

  	
  Title: Executive Vice
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ING BARINGS GLOBAL
  LEVERAGED EQUITY PLAN LTD.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  ING FURMAN SELZ
  INVESTMENTS III LLC,

  its Fund Manager

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ James Luikart

  	
   

  
	
   

  	
   

  	
  Name: James Luikart

  
	
   

  	
   

  	
  Title: Executive Vice
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ING BARINGS U.S.
  LEVERAGED EQUITY PLAN LLC

  
	
   

  	
   

  
	
   

  	
  By:

  	
  ING FURMAN SELZ
  INVESTMENTS III LLC,

  its Managing Member

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ James Luikart

  	
   

  
	
   

  	
   

  	
  Name: James Luikart

  
	
   

  	
   

  	
  Title: Executive Vice
  President

  
					

 

28

 

	
   

  	
  MANAGEMENT INVESTORS:

  
	
   

  	
   

  
	
   

  	
  /s/ John A. Saxton

  
	
   

  	
  John A. Saxton

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ David C. Hewitt

  
	
   

  	
  David C. Hewitt

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ G. Paul Bozuwa

  
	
   

  	
  G. Paul Bozuwa

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Robert M. Jakobe

  
	
   

  	
  Robert M. Jakobe

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Joan B. Weisman

  
	
   

  	
  Joan B. Weisman

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  

 

29

 

	
   

  	
  /s/ John M. Elliot

  
	
   

  	
  John M. Elliot

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Chris M. Azbill

  
	
   

  	
  Chris M. Azbill

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Douglas R. Ehmann

  
	
   

  	
  Douglas R. Ehmann

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ J. Kenneth Garner

  
	
   

  	
  J. Kenneth Garner

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Michael E. Klauer

  
	
   

  	
  Michael E. Klauer

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  

 

30

 

	
   

  	
  /s/ James W. Stirling

  
	
   

  	
  James W. Stirling

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Patricia A.
  Stricker

  
	
   

  	
  Patricia A. Stricker

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Robert M. Moore

  
	
   

  	
  Robert M. Moore

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Gary J. Kittredge

  
	
   

  	
  Gary J. Kittredge

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Edward H. Hartman

  
	
   

  	
  Edward H. Hartman

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  

 

31

 

	
   

  	
  /s/ Arthur R. Myers

  
	
   

  	
  Arthur R. Myers

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Jennifer A. Bedell

  
	
   

  	
  Jennifer A. Bedell

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Cynthia L.
  Beauchamp

  
	
   

  	
  Cynthia L. Beauchamp

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Michael J.
  Sartorelli

  
	
   

  	
  Michael J. Sartorelli

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ David T. Merchant

  
	
   

  	
  David T. Merchant

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  

 

32

 

	
   

  	
  /s/ Kenneth W. Raker

  
	
   

  	
  Kenneth W. Raker

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Jeffrey S. Cohen

  
	
   

  	
  Jeffrey S. Cohen

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ J. Dennis Smith

  
	
   

  	
  J. Dennis Smith

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Catherine R. Budd

  
	
   

  	
  Catherine R. Budd

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ George A. Whaling

  
	
   

  	
  George A. Whaling

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  

 

33

 

	
   

  	
  /s/ J.M. Dryden Hall,
  Jr.

  
	
   

  	
  J.M. Dryden Hall, Jr.

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Gary T. DiCamillo

  
	
   

  	
  Gary T. DiCamillo

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Craig H. Deery

  
	
   

  	
  Craig H. Deery

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Telephone No.:

  

 

34

 

Schedule I

 

Investors and
Securities Purchased and Exchanged

 

	
  Investor

  	
   

  	
  Common
  Stock 

  Purchase  Price

  ($10 per
  share)

  	
   

  	
  Preferred
  Stock 

  Purchase
  Price

  ($1,000
  per share)

  	
   

  	
  Number of
  Shares of

  Common
  Stock 

  Received

  	
   

  	
  Number of
  Shares of

  Preferred
  Stock 

  Received

  	
   

  	
  Aggregate 

  Purchase
  Price

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Bruckmann,
  Rosser, Sherrill & Co. II, L.P.

  	
   

  	
  $

  	
  2,286,869.49

  	
   

  	
  $

  	
  19,209,703.76

  	
   

  	
  228,686.949

  	
   

  	
  19,209.70376

  	
   

  	
  $

  	
  21,496,573.25

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ING
  Furman Selz Investors III L.P.

  	
   

  	
  1,593,479.22

  	
   

  	
  13,385,225.54

  	
   

  	
  159,347.922

  	
   

  	
  13,385.22554

  	
   

  	
  14,978,704.76

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ING
  Barings Global Leveraged  Equity Plan
  Ltd.

  	
   

  	
  130,357.28

  	
   

  	
  1,095,001.13

  	
   

  	
  13,035.728

  	
   

  	
  1,095.00113

  	
   

  	
  1,225,358.41

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ING
  Barings U.S. Leveraged Equity Plan LLC

  	
   

  	
  563,032.99

  	
   

  	
  4,729,477.09

  	
   

  	
  56,303.299

  	
   

  	
  4,729.47709

  	
   

  	
  5,292,510.08

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  John
  A. Saxton

  	
   

  	
  159,574.47

  	
   

  	
  1,340,425.53

  	
   

  	
  15,957.447

  	
   

  	
  1,340.42553

  	
   

  	
  1,500,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  David
  C. Hewitt

  	
   

  	
  63,829.79

  	
   

  	
  536,170.21

  	
   

  	
  6,382.979

  	
   

  	
  536.17021

  	
   

  	
  600,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  G.
  Paul Bozuwa

  	
   

  	
  31,914.89

  	
   

  	
  268,085.11

  	
   

  	
  3,191.489

  	
   

  	
  268.08511

  	
   

  	
  300,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Robert
  M. Jakobe

  	
   

  	
  10,638.30

  	
   

  	
  89,361.70

  	
   

  	
  1,063.830

  	
   

  	
  89.36170

  	
   

  	
  100,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Joan
  B. Weisman

  	
   

  	
  7,978.72

  	
   

  	
  67,021.28

  	
   

  	
  797.872

  	
   

  	
  67.02128

  	
   

  	
  75,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  John
  M. Elliot

  	
   

  	
  5,319.15

  	
   

  	
  44,680.85

  	
   

  	
  531.915

  	
   

  	
  44.68085

  	
   

  	
  50,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Chris
  M. Azbill

  	
   

  	
  5,319.15

  	
   

  	
  44,680.85

  	
   

  	
  531.915

  	
   

  	
  44.68085

  	
   

  	
  50,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Douglas
  R. Ehmann

  	
   

  	
  5,212.25

  	
   

  	
  43,782.88

  	
   

  	
  521.225

  	
   

  	
  43.78288

  	
   

  	
  48,995.13

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  J.
  Kenneth Garner

  	
   

  	
  4,560.04

  	
   

  	
  38,304.36

  	
   

  	
  456.004

  	
   

  	
  38.30436

  	
   

  	
  42,864.40

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Michael
  E. Klauer

  	
   

  	
  4,255.32

  	
   

  	
  35,744.68

  	
   

  	
  425.532

  	
   

  	
  35.74468

  	
   

  	
  40,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  James
  W. Stirling

  	
   

  	
  3,723.40

  	
   

  	
  31,276.60

  	
   

  	
  372.340

  	
   

  	
  31.27660

  	
   

  	
  35,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Patricia
  A. Stricker

  	
   

  	
  3,333.16

  	
   

  	
  27,998.55

  	
   

  	
  333.316

  	
   

  	
  27.99855

  	
   

  	
  31,331.71

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Robert
  M. Moore

  	
   

  	
  2,659.57

  	
   

  	
  22,340.43

  	
   

  	
  265.957

  	
   

  	
  22.34043

  	
   

  	
  25,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Gary
  J. Kittredge

  	
   

  	
  2,659.58

  	
   

  	
  22,340.42

  	
   

  	
  265.958

  	
   

  	
  22.34042

  	
   

  	
  25,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Edward
  H. Hartman

  	
   

  	
  2,127.66

  	
   

  	
  17,872.34

  	
   

  	
  212.766

  	
   

  	
  17.87234

  	
   

  	
  20,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Arthur
  R. Myers

  	
   

  	
  2,127.66

  	
   

  	
  17,872.34

  	
   

  	
  212.766

  	
   

  	
  17.87234

  	
   

  	
  20,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Jennifer
  A. Bedell

  	
   

  	
  1,595.74

  	
   

  	
  13,404.26

  	
   

  	
  159.574

  	
   

  	
  13.40426

  	
   

  	
  15,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cynthia
  L. Beauchamp

  	
   

  	
  1,063.83

  	
   

  	
  8,936.17

  	
   

  	
  106.383

  	
   

  	
  8.93617

  	
   

  	
  10,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Michael
  J. Sartorelli

  	
   

  	
  1,063.83

  	
   

  	
  8,936.17

  	
   

  	
  106.383

  	
   

  	
  8.93617

  	
   

  	
  10,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  David
  T. Merchant

  	
   

  	
  531.91

  	
   

  	
  4,468.09

  	
   

  	
  53.191

  	
   

  	
  4.46809

  	
   

  	
  5,000.00

  	
   

  

 

 

	
  Investor

  	
   

  	
  Common
  Stock 

  Purchase  Price

  ($10 per
  share)

  	
   

  	
  Preferred
  Stock 

  Purchase
  Price

  ($1,000
  per share)

  	
   

  	
  Number of
  Shares of

  Common
  Stock 

  Received

  	
   

  	
  Number of
  Shares of

  Preferred
  Stock 

  Received

  	
   

  	
  Aggregate 

  Purchase
  Price

  	
   

  
	
  Kenneth
  W. Raker

  	
   

  	
  1,063.83

  	
   

  	
  8,936.17

  	
   

  	
  106.383

  	
   

  	
  8.93617

  	
   

  	
  10,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Jeffrey
  S. Cohen

  	
   

  	
  797.87

  	
   

  	
  6,702.13

  	
   

  	
  79.787

  	
   

  	
  6.70213

  	
   

  	
  7,500.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  J.
  Dennis Smith

  	
   

  	
  531.91

  	
   

  	
  4,468.09

  	
   

  	
  53.191

  	
   

  	
  4.46809

  	
   

  	
  5,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Catherine
  R. Budd

  	
   

  	
  319.15

  	
   

  	
  2,680.85

  	
   

  	
  31.915

  	
   

  	
  2.68085

  	
   

  	
  3,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  George
  A. Whaling

  	
   

  	
  32,385.74

  	
   

  	
  272,040.01

  	
   

  	
  3,238.574

  	
   

  	
  272.04001

  	
   

  	
  304,425.75

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  J.M.
  Dryden Hall, Jr.

  	
   

  	
  10,638.30

  	
   

  	
  89,361.70

  	
   

  	
  1,063.830

  	
   

  	
  89.36170

  	
   

  	
  100,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Gary
  T. DiCamillo

  	
   

  	
  31,914.89

  	
   

  	
  268,085.11

  	
   

  	
  3,191.489

  	
   

  	
  268.08511

  	
   

  	
  300,000.00

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Craig
  H. Deery

  	
   

  	
  29,120.91

  	
   

  	
  244,615.60

  	
   

  	
  2,912.091

  	
   

  	
  244.61560

  	
   

  	
  273,736.51

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total

  	
   

  	
  $

  	
  5,000,000.00

  	
   

  	
  $

  	
  42,000,000.00

  	
   

  	
  500,000.000

  	
   

  	
  42,000.00000

  	
   

  	
  $

  	
  47,000,000.00

  	
   

  
																									

 

2

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00058-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00058-of-00352.parquet"}]]