Document:

EX-4.5

 

Exhibit 4.5

WESCO DISTRIBUTION, INC.

$150,000,000

7.5% Senior Subordinated Notes due 2017

EXCHANGE AND REGISTRATION RIGHTS AGREEMENT

September 27, 2005

GOLDMAN, SACHS & CO.

LEHMAN BROTHERS INC.

As representatives of the several Initial Purchasers

c/o Goldman, Sachs & Co.

85 Broad Street

New York, New York 10004

c/o Lehman Brothers Inc.

745 7th Avenue

New York, New York 10019

Ladies and Gentlemen:

          WESCO Distribution, Inc., a Delaware corporation (the “Company”), proposes to issue
and sell to Goldman, Sachs & Co. (“Goldman”), Lehman Brothers Inc. (“Lehman”), UBS
Securities LLC, Banc of America Securities LLC and Credit Suisse First Boston LLC (together with
Goldman and Lehman, the “Initial Purchasers”), upon the terms and subject to the conditions
set forth in a purchase agreement dated September 22, 2005 (the “Purchase Agreement”),
$150,000,000 aggregate principal amount of its 7.5% Senior Subordinated Notes due 2017 (the
“Securities”) to be guaranteed on an unsecured senior basis by WESCO International, Inc.
(the “Guarantor”). Capitalized terms used but not defined herein shall have the meanings
given to such terms in the Purchase Agreement.

          As an inducement to the Initial Purchasers to enter into the Purchase Agreement and in
satisfaction of a condition to the obligations of the Initial Purchasers thereunder, the Company
and the Guarantor agree with the Initial Purchasers, for the benefit of the holders (including the
Initial Purchasers) of the Securities, the Exchange Securities (as defined herein) and the Private
Exchange Securities (as defined herein) (collectively, the “Holders”), as follows:

          1. Registered Exchange Offer. The Company and the Guarantor shall (i) prepare and,
not later than 210 days following the date of original issuance of the Securities (the “Issue
Date”), file with the Commission a registration statement (the “Exchange Offer Registration
Statement”) on an appropriate form under the Securities Act with respect to a proposed offer to
the Holders of the Securities (the “Registered Exchange Offer”) to issue and deliver to
such Holders, in exchange for the Securities, a like aggregate principal amount of debt securities
of the Company (the “Exchange Securities”) that are identical in all material respects to
the Securities, except for the transfer restrictions relating to the Securities, (ii) use their

 

 

reasonable best efforts to cause the Exchange Offer Registration Statement to become effective
under the Securities Act no later than 270 days after the Issue Date and the Registered Exchange
Offer to be consummated no later than 300 days after the Issue Date and (iii) keep the Exchange
Offer Registration Statement effective for not less than 20 business days (or longer, if required
by applicable law) after the date on which notice of the Registered Exchange Offer is mailed to the
Holders (such period being called the “Securities Exchange Offer Registration Period”).
The Exchange Securities will be issued under the Indenture or an indenture (the “Exchange
Securities Indenture”) among the Company, the Guarantor and the Trustee or such other bank or
trust company that is reasonably satisfactory to the Initial Purchasers, as trustee (the
“Exchange Securities Trustee”), such indenture to be identical in all material respects to
the Indenture, except for the transfer restrictions relating to the Securities (as described
above).

          As soon as practicable after the effectiveness of the Exchange Offer Registration Statement,
the Company shall promptly commence the Registered Exchange Offer, it being the objective of such
Registered Exchange Offer to enable each Holder electing to exchange Securities for Exchange
Securities (assuming that such Holder (a) is not an affiliate of the Company or an Exchanging
Dealer (as defined herein) not complying with the requirements of the next sentence, (b) is not an
Initial Purchaser holding Securities that have, or that are reasonably likely to have, the status
of an unsold allotment in an initial distribution, (c) acquires the Exchange Securities in the
ordinary course of such Holder’s business and (d) has no arrangements or understandings with any
person to participate in the distribution of the Exchange Securities) and to trade such Exchange
Securities from and after their receipt without any limitations or restrictions under the
Securities Act and without material restrictions under the securities laws of the several states of
the United States. The Company, the Guarantor, the Initial Purchasers and each Exchanging Dealer
acknowledge that, pursuant to current interpretations by the Commission’s staff of Section 5 of the
Securities Act, each Holder that is a broker-dealer electing to exchange Securities, acquired for
its own account as a result of market-making activities or other trading activities, for Exchange
Securities (an “Exchanging Dealer”), is required to deliver a prospectus containing
substantially the information set forth in Annex A hereto on the cover, in Annex B hereto in the
“Exchange Offer Procedures” section and the “Purpose of the Exchange Offer” section and in Annex C
hereto in the “Plan of Distribution” section of such prospectus in connection with a sale of any
such Exchange Securities received by such Exchanging Dealer pursuant to the Registered Exchange
Offer.

          If, prior to the consummation of the Registered Exchange Offer, any Holder holds any
Securities acquired by it that have, or that are reasonably likely to be determined to have, the
status of an unsold allotment in an initial distribution, or any Holder is not entitled to
participate in the Registered Exchange Offer, the Company shall, upon the request of any such
Holder, simultaneously with the delivery of the Exchange Securities in the Registered Exchange
Offer, issue and deliver to any such Holder, in exchange for the Securities held by such Holder
(the “Private Exchange”), a like aggregate principal amount of debt securities of the
Company (the “Private Exchange Securities”) that are identical in all material respects to
the Exchange Securities, except for the transfer restrictions relating to such Private Securities
Exchange Securities. The Private Exchange Securities will be issued under the same indenture as
the Exchange Securities, and the Company shall use its reasonable best efforts to cause the Private
Exchange Securities to bear the same CUSIP number as the Exchange Securities.

 

 

          In connection with the Registered Exchange Offer, the Company shall:

     (a) mail to each Holder a copy of the prospectus forming part of the Exchange Offer
Registration Statement, together with an appropriate letter of transmittal and related
documents;

     (b) keep the Registered Exchange Offer open for not less than 20 business days (or
longer, if required by applicable law) after the date on which notice of the Registered
Exchange Offer is mailed to the Holders;

     (c) utilize the services of a depositary for the Registered Exchange Offer with an
address in the Borough of Manhattan, The City of New York;

     (d) permit Holders to withdraw tendered Securities at any time prior to 12:00 pm
midnight, New York City time, on the last business day on which the Registered Exchange
Offer shall remain open; and

     (e) otherwise comply in all material respects with all laws that are applicable to the
Registered Exchange Offer.

          As soon as practicable after the close of the Registered Exchange Offer or any Private
Exchange, as the case may be, the Company shall:

     (a) accept for exchange all Securities validly tendered and not validly withdrawn
pursuant to the Registered Exchange Offer and the Private Exchange;

     (b) deliver to the Trustee for cancellation all Securities so accepted for exchange;
and

     (c) cause the Trustee or the Exchange Securities Trustee, as the case may be, to
promptly authenticate and deliver to each Holder, Exchange Securities or Private Exchange
Securities, as the case may be, equal in principal amount to the Securities of such Holder
so accepted for exchange.

          The Company shall use its reasonable best efforts to keep the Exchange Offer Registration
Statement effective and to amend and supplement the prospectus contained therein in order to permit
such prospectus to be used by all persons subject to the prospectus delivery requirements of the
Securities Act for such period of time as such persons must comply with such requirements in order
to resell the Exchange Securities; provided that (i) in the case where such prospectus and any
amendment or supplement thereto must be delivered by an Exchanging Dealer, such period shall be the
lesser of 180 days and the date on which all Exchanging Dealers have sold all Securities held by
them and (ii) the Company shall make such prospectus and any amendment or supplement thereto
available to any broker-dealer for use in connection with any resale of any Exchange Securities for
a period of not less than 180 days after the consummation of the Registered Exchange Offer.

          The Indenture or the Exchange Securities Indenture, as the case may be, shall provide that the
Securities, the Exchange Securities and the Private Exchange Securities shall

 

 

vote and consent together on all matters as one class and that none of the Securities, the
Exchange Securities or the Private Exchange Securities will have the right to vote or consent as a
separate class on any matter.

          Interest on each Exchange Security and Private Exchange Security issued pursuant to the
Registered Exchange Offer and in the Private Exchange will accrue from the last interest payment
date on which interest was paid on the Securities surrendered in exchange therefor or, if no
interest has been paid on the Securities, from the Issue Date.

          Each Holder participating in the Registered Exchange Offer shall be required to represent to
the Company at the time of the tender of the Securities by such Holder pursuant to the Registered
Exchange Offer that (i) any Exchange Securities received by such Holder will be acquired in the
ordinary course of business, (ii) such Holder will have no arrangements or understandings with any
person to participate in the distribution of the Securities or the Exchange Securities within the
meaning of the Securities Act and (iii) such Holder is not an affiliate of the Company or the
Guarantor or, if it is such an affiliate, such Holder will comply with the registration and
prospectus delivery requirements of the Securities Act to the extent applicable.

          Notwithstanding any other provisions hereof, the Company and the Guarantor will ensure that
(i) any Exchange Offer Registration Statement and any amendment thereto and any prospectus forming
part thereof and any supplement thereto complies in all material respects with the Securities Act
and the rules and regulations of the Commission thereunder, (ii) any Exchange Offer Registration
Statement and any amendment thereto does not, when it becomes effective, contain an untrue
statement of a material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading and (iii) any prospectus forming part of
any Exchange Offer Registration Statement, and any supplement to such prospectus, does not, as of
the consummation of the Registered Exchange Offer, include an untrue statement of a material fact
or omit to state a material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading.

          2. Shelf Registration. If (i) because of any change in law or applicable
interpretations thereof by the Commission’s staff, the Company is not permitted to effect the
Registered Exchange Offer as contemplated by Section 1 hereof, or (ii) any Securities validly
tendered pursuant to the Registered Exchange Offer are not exchanged for Exchange Securities prior
to 300 days after the Issue Date, or (iii) any Initial Purchaser so requests with respect to the
Securities or Private Exchange Securities not eligible to be exchanged for Exchange Securities in
the Registered Exchange Offer and held by it following the consummation of the Registered Exchange
Offer, or (iv) any applicable law or interpretations do not permit any Holder to participate in the
Registered Exchange Offer, or (v) any Holder that participates in the Registered Exchange Offer
does not receive freely transferable Exchange Securities in exchange for tendered Securities, or
(vi) the Company and the Guarantor so elect, then the following provisions shall apply:

     (a) The Company and the Guarantor shall file as promptly as practicable with the
Commission, and thereafter shall use their reasonable best efforts to cause to be

 

 

declared effective, a shelf registration statement on an appropriate form under the
Securities Act relating to the offer and sale of the Transfer Restricted Securities (as
defined below) by the Holders thereof from time to time in accordance with the methods of
distribution set forth in such registration statement (hereafter, a “Shelf Registration
Statement”).

     (b) The Company and the Guarantor shall use their reasonable best efforts to keep the
Shelf Registration Statement continuously effective in order to permit the prospectus
forming part thereof to be used by Holders of Transfer Restricted Securities for a period
ending on the earlier of (i) two years from the Issue Date or such shorter period that will
terminate when all the Transfer Restricted Securities covered by the Shelf Registration
Statement have been sold pursuant thereto and (ii) the date on which the Securities become
eligible for resale without volume restrictions pursuant to Rule 144 under the Securities
Act (in any such case, such period being called the “Shelf Registration Period”).
The Company and the Guarantor shall be deemed not to have used their reasonable best efforts
to keep the Shelf Registration Statement effective during the requisite period if any of
them voluntarily take any action that would result in Holders of Transfer Restricted
Securities covered thereby not being able to offer and sell such Transfer Restricted
Securities during that period, unless (A) such action is required by applicable law or (B)
such action was permitted by Section 3(b).

     (c) Notwithstanding any other provisions hereof, the Company and the Guarantor will
ensure that (i) any Shelf Registration Statement and any amendment thereto and any
prospectus forming part thereof and any supplement thereto complies in all material respects
with the Securities Act and the rules and regulations of the Commission thereunder, (ii) any
Shelf Registration Statement and any amendment thereto (in either case, other than with
respect to information included therein in reliance upon or in conformity with written
information furnished to the Company by or on behalf of any Holder specifically for use
therein (the “Holders’ Information”)) does not contain an untrue statement of a
material fact or omit to state a material fact required to be stated therein or necessary to
make the statements therein not misleading and (iii) any prospectus forming part of any
Shelf Registration Statement, and any supplement to such prospectus (in either case, other
than with respect to Holders’ Information), does not include an untrue statement of a
material fact or omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not misleading.

     3. Additional Interest.

     (a) The parties hereto agree that the Holders of Transfer Restricted Securities will
suffer damages if the Company and the Guarantor fail to fulfill their obligations under
Section 1 or Section 2, as applicable, and that it would not be feasible to ascertain the
extent of such damages. Accordingly, if (i) the Exchange Offer Registration Statement or
Shelf Registration Statement, as the case may be, is not filed with the Commission on or
prior to 210 days after the Issue Date (or, in the case of a Shelf Registration Statement
required to be filed in response to a change in law or applicable interpretations of the
Commission’s staff, if later, within 45 days after publication of the

 

 

change in law or interpretations, but in no event before 210 days after the Issue
Date), (ii) the Exchange Offer Registration Statement or the Shelf Registration Statement,
as the case may be, is not declared effective within 270 days after the Issue Date (or in
the case of a Shelf Registration Statement required to be filed in response to a change in
law or the applicable interpretations of Commission’s staff, if later, within 90 days after
publication of the change in law or interpretation, but in no event before 270 days after
the Issue Date), (iii) the Registered Exchange Offer is not consummated on or prior to 300
days after the Issue Date (other than in the event the Company files a Shelf Registration
Statement), or (iv) the Shelf Registration Statement is filed and declared effective within
270 days after the Issue Date (or in the case of a Shelf Registration Statement required to
be filed in response to a change in law or the applicable interpretations of the
Commission’s staff, if later, within 90 days after publication of the change in law or
interpretation, but in no event before 270 days after the Issue Date) but shall thereafter
cease to be effective (at any time that the Company is obligated to maintain the
effectiveness thereof) without being succeeded within 90 days by an additional Registration
Statement filed and declared effective (each such event referred to in clauses (i) through
(iv), a “Registration Default”), the Company and the Guarantor will be jointly and
severally obligated to pay additional interest to each Holder of Transfer Restricted
Securities, during the period of one or more such Registration Defaults, in an amount equal
to $ 0.192 per week per $1,000 principal amount of Transfer Restricted Securities held by
such Holder until (i) the Exchange Offer Registration Statement or Shelf Registration
Statement, as the case may be, is filed, (ii) the Exchange Offer Registration Statement is
declared effective and the Registered Exchange Offer is consummated, (iii) the Shelf
Registration Statement is declared effective or (iv) the Shelf Registration Statement again
becomes effective, as the case may be. Following the cure of all Registration Defaults, the
accrual of additional interest will cease. As used herein, the term “Transfer
Restricted Securities” means (i) each Security until the date on which such Security has
been exchanged for a freely transferable Exchange Security in the Registered Exchange Offer,
(ii) each Security or Private Exchange Security until the date on which it has been
effectively registered under the Securities Act and disposed of in accordance with the Shelf
Registration Statement or (iii) each Security or Private Exchange Security until the date on
which it is distributed to the public pursuant to Rule 144 under the Securities Act or is
saleable pursuant to Rule 144(k) under the Securities Act. Notwithstanding anything to the
contrary in this Section 3(a), the Company shall not be required to pay additional interest
to a Holder of Transfer Restricted Securities if such Holder failed to comply with its
obligations to make the representations set forth in the second to last paragraph of Section
1 or failed to provide the information required to be provided by it, if any, pursuant to
Section 4(n).

     (b) Notwithstanding the foregoing provisions of Section 3(a), the Company may issue a
notice that the Shelf Registration Statement is unusable pending the announcement of a
material development or event and may issue any notice suspending use of the Shelf
Registration Statement required under applicable securities laws to be issued and, in the
event that the aggregate number of days in any consecutive twelve-month period for which all
such notices are issued and effective exceeds 45 days in the aggregate, then the Company and
the Guarantor will be obligated to pay additional interest to each Holder of Transfer
Restricted Securities in an amount equal to $0.192 per

 

 

week per $1,000 principal amount of Transfer Restricted Securities held by such Holder.
Upon the Company declaring that the Shelf Registration Statement is usable after the period
of time described in the preceding sentence, the accrual of additional interest shall cease;
provided, however, that if after any such cessation of the accrual of additional interest,
the Shelf Registration Statement again ceases to be usable beyond the period permitted
above, additional interest will again accrue pursuant to the foregoing provisions.

          (c) The Company shall notify the Trustee and the Paying Agent under the Indenture
immediately upon the happening of each and every Registration Default. The Company and the
Guarantor shall pay the additional interest due on the Transfer Restricted Securities by
depositing with the Paying Agent (which may not be the Company for these purposes), in
trust, for the benefit of the Holders thereof, prior to 10:00 a.m., New York City time, on
the next interest payment date specified by the Indenture and the Securities, sums
sufficient to pay the additional interest then due. The additional interest due shall be
payable on each interest payment date specified by the Indenture and the Securities to the
record holder entitled to receive the interest payment to be made on such date. Each
obligation to pay additional interest shall be deemed to accrue from and including the date
of the applicable Registration Default.

          (d) The parties hereto agree that the additional interest provided for in this Section
3 constitute a reasonable estimate of and are intended to constitute the sole damages that
will be suffered by Holders of Transfer Restricted Securities by reason of the failure of
(i) the Shelf Registration Statement or the Exchange Offer Registration Statement to be
filed, (ii) the Shelf Registration Statement to remain effective or (iii) the Exchange Offer
Registration Statement to be declared effective and the Registered Exchange Offer to be
consummated, in each case to the extent required by this Agreement.

          4. Registration Procedures. In connection with any Registration Statement, the
following provisions shall apply:

     (a) The Company shall (i) furnish to each Initial Purchaser, prior to the filing
thereof with the Commission, a copy of the Registration Statement and each amendment thereof
and each supplement, if any, to the prospectus included therein; (ii) include the
information set forth in Annex A hereto on the cover, in Annex B hereto in the “Exchange
Offer Procedures” section and the “Purpose of the Exchange Offer” section and in Annex C
hereto in the “Plan of Distribution” section of the prospectus forming a part of the
Exchange Offer Registration Statement, and include the information set forth in Annex D
hereto in the Letter of Transmittal delivered pursuant to the Registered Exchange Offer; and
(iii) if requested by any Initial Purchaser, include the information required by Items 507
or 508 of Regulation S-K, as applicable, in the prospectus forming a part of the Exchange
Offer Registration Statement.

     (b) The Company shall advise each Initial Purchaser, each Exchanging Dealer and the
Holders (if applicable) and, if requested by any such person, confirm such advice in writing
(which advice pursuant to clauses (ii)-(v) hereof shall be accompanied by an

 

 

instruction to suspend the use of the prospectus until the requisite changes have been
made):

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

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

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

     (iv) of the receipt by the Company of any notification with respect to the
suspension of the qualification of the Securities, the Exchange Securities or the
Private Exchange Securities for sale in any jurisdiction or the initiation or
threatening of any proceeding for such purpose; and

     (v) of the happening of any event that requires the making of any changes in
any Registration Statement or the prospectus included therein in order that the
statements therein are not misleading and do not omit to state a material fact
required to be stated therein or necessary to make the statements therein not
misleading.

     (c) The Company and the Guarantor will make every reasonable effort to obtain the
withdrawal at the earliest possible time of any order suspending the effectiveness of any
Registration Statement.

     (d) The Company will furnish to each Holder of Transfer Restricted Securities included
within the coverage of any Shelf Registration Statement, without charge, at least one
conformed copy of such Shelf Registration Statement and any post-effective amendment
thereto, including financial statements and schedules and, if any such Holder so requests in
writing, all exhibits thereto (including those, if any, incorporated by reference).

     (e) The Company will, during the Shelf Registration Period, promptly deliver to each
Holder of Transfer Restricted Securities included within the coverage of any Shelf
Registration Statement, without charge, as many copies of the prospectus (including each
preliminary prospectus) included in such Shelf Registration Statement and any amendment or
supplement thereto as such Holder may reasonably request; and the Company consents to the
use of such prospectus or any amendment or supplement thereto by each of the selling Holders
of Transfer Restricted Securities in connection with the offer and sale of the Transfer
Restricted Securities covered by such prospectus or any amendment or supplement thereto.

 

 

     (f) The Company will, during the period not exceeding 180 days following the expiration
of the Registered Exchange Offer, furnish to each Initial Purchaser and each Exchanging
Dealer, and to any other Holder who so requests, without charge, at least one conformed copy
of the Exchange Offer Registration Statement and any post-effective amendment thereto,
including financial statements and schedules and, if any Initial Purchaser or Exchanging
Dealer or any such Holder so requests in writing, all exhibits thereto (including those, if
any, incorporated by reference).

     (g) The Company will, during the Exchange Offer Registration Period or the Shelf
Registration Period, as applicable, promptly deliver to each Initial Purchaser, each
Exchanging Dealer and such other persons that are required to deliver a prospectus following
the Registered Exchange Offer, without charge, as many copies of the final prospectus
included in the Exchange Offer Registration Statement or the Shelf Registration Statement
and any amendment or supplement thereto as such Initial Purchaser, Exchanging Dealer or
other persons may reasonably request; and the Company and the Guarantor consent to the use
of such prospectus or any amendment or supplement thereto by any such Initial Purchaser,
Exchanging Dealer or other persons, as applicable, as aforesaid.

     (h) Prior to the effective date of any Registration Statement, the Company and the
Guarantor will use their reasonable best efforts to register or qualify, or cooperate with
the Holders of Securities, Exchange Securities or Private Exchange Securities included
therein and their respective counsel in connection with the registration or qualification
of, such Securities, Exchange Securities or Private Exchange Securities for offer and sale
under the securities or blue sky laws of such jurisdictions as any such Holder reasonably
requests in writing and do any and all other acts or things necessary or advisable to enable
the offer and sale in such jurisdictions of the Securities, Exchange Securities or Private
Exchange Securities covered by such Registration Statement; provided that the Company and
the Guarantor will not be required to qualify generally to do business in any jurisdiction
where they are not then so qualified or to take any action which would subject them to
general service of process or to taxation in any such jurisdiction where they are not then
so subject.

     (i) The Company and the Guarantor will cooperate with the Holders of Securities,
Exchange Securities or Private Exchange Securities to facilitate the timely preparation and
delivery of certificates representing Securities, Exchange Securities or Private Exchange
Securities to be sold pursuant to any Registration Statement free of any restrictive legends
and in such denominations and registered in such names as the Holders thereof may request in
writing prior to sales of Securities, Exchange Securities or Private Exchange Securities
pursuant to such Registration Statement.

     (j) If any event contemplated by Section 4(b)(ii) through (v) occurs during the period
for which the Company and the Guarantor are required to maintain an effective Registration
Statement, the Company and the Guarantor will promptly prepare and file with the Commission
a post-effective amendment to the Registration Statement or a supplement to the related
prospectus or file any other required document so that, as thereafter delivered to
purchasers of the Securities, Exchange Securities or Private

 

 

Exchange Securities from a Holder, the prospectus will not include an untrue statement
of a material fact or omit to state a material fact necessary in order to make the
statements therein, in the light of the circumstances under which they were made, not
misleading.

     (k) Not later than the effective date of the applicable Registration Statement, the
Company will provide a CUSIP number for the Securities, the Exchange Securities and the
Private Exchange Securities, as the case may be, and provide the applicable trustee with
printed certificates for the Securities, the Exchange Securities or the Private Exchange
Securities, as the case may be, in a form eligible for deposit with The Depository Trust
Company.

     (l) The Company and the Guarantor will comply with all applicable rules and regulations
of the Commission and the Company will make generally available to its security holders as
soon as practicable after the effective date of the applicable Registration Statement an
earning statement covering at least 12 months satisfying the provisions of Section 11(a) of
the Securities Act.

     (m) The Company and the Guarantor will cause the Indenture or the Exchange Securities
Indenture, as the case may be, to be qualified under the Trust Indenture Act as required by
applicable law in a timely manner.

     (n) The Company may require each Holder of Transfer Restricted Securities to be
registered pursuant to any Shelf Registration Statement to furnish to the Company such
information concerning the Holder and the distribution of such Transfer Restricted
Securities as the Company may from time to time reasonably require for inclusion in such
Shelf Registration Statement and the Company may exclude from such registration the Transfer
Restricted Securities of any Holder that fails to furnish such information within a
reasonable time after receiving such request.

     (o) In the case of a Shelf Registration Statement, each Holder of Transfer Restricted
Securities to be registered pursuant thereto agrees by acquisition of such Transfer
Restricted Securities that, upon receipt of any notice from the Company pursuant to Section
4(b)(ii) through (v), such Holder will discontinue disposition of such Transfer Restricted
Securities until such Holder’s receipt of copies of the supplemental or amended prospectus
contemplated by Section 4(j) or until advised in writing (the “Advice”) by the
Company that the use of the applicable prospectus may be resumed. If the Company shall give
any notice under Section 4(b)(ii) through (v) during the period that the Company is required
to maintain an effective Registration Statement (the “Effectiveness Period”), such
Effectiveness Period shall be extended by the number of days during such period from and
including the date of the giving of such notice to and including the date when each seller
of Transfer Restricted Securities covered by such Registration Statement shall have received
(x) the copies of the supplemental or amended prospectus contemplated by Section 4(j) (if an
amended or supplemental prospectus is required) or (y) the Advice (if no amended or
supplemental prospectus is required).

     (p) In the case of a Shelf Registration Statement, the Company and the Guarantor shall
enter into such customary agreements (including, if requested, an

 

 

underwriting agreement in customary form) and take all such other action, if any, as
Holders of a majority in aggregate principal amount of the Securities, Exchange Securities
or Private Exchange Securities being sold or the managing underwriters (if any) shall
reasonably request in order to facilitate any disposition of Securities, Exchange Securities
or Private Exchange Securities pursuant to such Shelf Registration Statement.

     (q) In the case of a Shelf Registration Statement, the Company shall (i) make
reasonably available for inspection by a representative of, and Special Counsel (as defined
below) acting for, Holders of a majority in aggregate principal amount of the Securities,
Exchange Securities and Private Exchange Securities being sold and any underwriter
participating in any disposition of Securities, Exchange Securities or Private Exchange
Securities pursuant to such Shelf Registration Statement, all relevant financial and other
records, pertinent corporate documents and properties of the Company and its subsidiaries
and (ii) use its reasonable best efforts to have its officers, directors, employees,
accountants and counsel supply all relevant information reasonably requested by such
representative, Special Counsel or any such underwriter (an “Inspector”) in
connection with such Shelf Registration Statement.

     (r) In the case of a Shelf Registration Statement, the Company shall, if requested by
Holders of a majority in aggregate principal amount of the Securities, Exchange Securities
and Private Exchange Securities being sold, their Special Counsel or the managing
underwriters (if any) in connection with such Shelf Registration Statement, use its
reasonable best efforts to cause (i) its counsel to deliver an opinion relating to the Shelf
Registration Statement and the Securities, Exchange Securities or Private Exchange
Securities, as applicable, in customary form, (ii) its officers to execute and deliver all
customary documents and certificates requested by Holders of a majority in aggregate
principal amount of the Securities, Exchange Securities and Private Exchange Securities
being sold, their Special Counsel or the managing underwriters (if any) and (iii) its
independent public accountants to provide a comfort letter or letters in customary form,
subject to receipt of appropriate documentation as contemplated, and only if permitted, by
Statement of Auditing Standards No. 72.

          5. Registration Expenses. The Company and the Guarantor will jointly and severally
bear all expenses incurred in connection with the performance of its obligations under Sections 1,
2, 3 and 4, and, other than in connection with the Exchange Offer Registration Statement, the
Company will reimburse the Initial Purchasers and the Holders for the reasonable fees and
disbursements of one firm of attorneys chosen by the Holders of a majority in aggregate principal
amount of the Securities, the Exchange Securities and the Private Exchange Securities to be sold
pursuant to each Registration Statement (the “Special Counsel”) acting for the Initial
Purchasers or Holders in connection therewith.

          6. Indemnification.

          (a) In the event of a Shelf Registration Statement or in connection with any prospectus
delivery pursuant to an Exchange Offer Registration Statement by an Initial Purchaser or Exchanging
Dealer, as applicable, the Company and Holdings shall jointly and severally indemnify and hold
harmless each Holder (including, without limitation, any such Initial

 

 

Purchaser or Exchanging Dealer), its affiliates, their respective officers, directors,
employees, representatives and agents, and each person, if any, who controls such Holder within the
meaning of the Securities Act or the Exchange Act (collectively referred to for purposes of this
Section 6 and Section 7 as a Holder) from and against any loss, claim, damage or liability, joint
or several, or any action in respect thereof (including, without limitation, any loss, claim,
damage, liability or action relating to purchases and sales of Securities, Exchange Securities or
Private Exchange Securities), to which that Holder may become subject, whether commenced or
threatened, under the Securities Act, the Exchange Act, any other federal or state statutory law or
regulation, at common law or otherwise, insofar as such loss, claim, damage, liability or action
arises out of, or is based upon, (i) any untrue statement or alleged untrue statement of a material
fact contained in any such Registration Statement or any prospectus forming part thereof or in any
amendment or supplement thereto or (ii) the omission or alleged omission to state therein a
material fact required to be stated therein or necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading, and shall reimburse
each Holder promptly upon demand for any legal or other expenses reasonably incurred by that Holder
in connection with investigating or defending or preparing to defend against or appearing as a
third party witness in connection with any such loss, claim, damage, liability or action as such
expenses are incurred; provided, however, that the Company and Holdings shall not be liable in any
such case to the extent that any such loss, claim, damage, liability or action arises out of, or is
based upon, an untrue statement or alleged untrue statement in or omission or alleged omission from
any of such documents in reliance upon and in conformity with any Holders’ Information; and
provided, further, that with respect to any such untrue statement in or omission from any related
preliminary prospectus, the indemnity agreement contained in this Section 6(a) shall not inure to
the benefit of any Holder from whom the person asserting any such loss, claim, damage, liability or
action received Securities, Exchange Securities or Private Exchange Securities to the extent that
such loss, claim, damage, liability or action of or with respect to such Holder results from the
fact that both (A) a copy of the final prospectus was not sent or given to such person at or prior
to the written confirmation of the sale of such Securities, Exchange Securities or Private Exchange
Securities to such person and (B) the untrue statement in or omission from the related preliminary
prospectus was corrected in the final prospectus unless, in either case, such failure to deliver
the final prospectus was a result of non-compliance by the Company with Section 4(d), 4(e), 4(f) or
4(g).

          (b) In the event of a Shelf Registration Statement, each Holder shall indemnify and hold
harmless the Company, its affiliates, their respective officers, directors, employees,
representatives and agents, and each person, if any, who controls the Company within the meaning of
the Securities Act or the Exchange Act (collectively referred to for purposes of this Section 6(b)
and Section 7 as the Company), from and against any loss, claim, damage or liability, joint or
several, or any action in respect thereof, to which the Company may become subject, whether
commenced or threatened, under the Securities Act, the Exchange Act, any other federal or state
statutory law or regulation, at common law or otherwise, insofar as such loss, claim, damage,
liability or action arises out of, or is based upon, (i) any untrue statement or alleged untrue
statement of a material fact contained in any such Registration Statement or any prospectus forming
part thereof or in any amendment or supplement thereto or (ii) the omission or alleged omission to
state therein a material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were made, not misleading,
but in each case only to the extent that the untrue

 

 

statement or alleged untrue statement or omission or alleged omission was made in reliance
upon and in conformity with any Holders’ Information furnished to the Company by such Holder, and
shall reimburse the Company for any legal or other expenses reasonably incurred by the Company in
connection with investigating or defending or preparing to defend against or appearing as a third
party witness in connection with any such loss, claim, damage, liability or action as such expenses
are incurred; provided, however, that no such Holder shall be liable for any indemnity claims
hereunder in excess of the amount of net proceeds received by such Holder from the sale of
Securities, Exchange Securities or Private Exchange Securities pursuant to such Registration
Statement.

          (c) Promptly after receipt by an indemnified party under this Section 6 of notice of any claim
or the commencement of any action, the indemnified party shall, if a claim in respect thereof is to
be made against the indemnifying party pursuant to Section 6(a) or 6(b), notify the indemnifying
party in writing of the claim or the commencement of that action; provided, however, that the
failure to notify the indemnifying party shall not relieve it from any liability which it may have
under this Section 6 except to the extent that it has been materially prejudiced (through the
forfeiture of substantive rights or defenses) by such failure; and provided, further, that the
failure to notify the indemnifying party shall not relieve it from any liability which it may have
to an indemnified party otherwise than under this Section 6. If any such claim or action shall be
brought against an indemnified party, and it shall notify the indemnifying party thereof, the
indemnifying party shall be entitled to participate therein and, to the extent that it wishes,
jointly with any other similarly notified indemnifying party, to assume the defense thereof with
counsel reasonably satisfactory to the indemnified party. After notice from the indemnifying party
to the indemnified party of its election to assume the defense of such claim or action, the
indemnifying party shall not be liable to the indemnified party under this Section 6 for any legal
or other expenses subsequently incurred by the indemnified party in connection with the defense
thereof other than the reasonable costs of investigation; provided, however, that an indemnified
party shall have the right to employ its own counsel in any such action, but the fees, expenses and
other charges of such counsel for the indemnified party will be at the expense of such indemnified
party unless (1) the employment of counsel by the indemnified party has been authorized in writing
by the indemnifying party, (2) the indemnified party has reasonably concluded (based upon advice of
counsel to the indemnified party) that there may be legal defenses available to it or other
indemnified parties that are different from or in addition to those available to the indemnifying
party, (3) a conflict or potential conflict exists (based upon advice of counsel to the indemnified
party) between the indemnified party and the indemnifying party (in which case the indemnifying
party will not have the right to direct the defense of such action on behalf of the indemnified
party) or (4) the indemnifying party has not in fact employed counsel reasonably satisfactory to
the indemnified party to assume the defense of such action within a reasonable time after receiving
notice of the commencement of the action, in each of which cases the reasonable fees, disbursements
and other charges of counsel will be at the expense of the indemnifying party or parties. It is
understood that the indemnifying party or parties shall not, in connection with any proceeding or
related proceedings in the same jurisdiction, be liable for the reasonable fees, disbursements and
other charges of more than one separate firm of attorneys (in addition to any local counsel) at any
one time for all such indemnified party or parties. Each indemnified party, as a condition of the
indemnity agreements contained in Sections 6(a) and 6(b), shall use all reasonable efforts to
cooperate with the indemnifying party in the defense of any such action or claim. No indemnifying
party shall be

 

 

liable for any settlement of any such action effected without its written consent (which
consent shall not be unreasonably withheld), but if settled with its written consent or if there be
a final judgment for the plaintiff in any such action, the indemnifying party agrees to indemnify
and hold harmless any indemnified party from and against any loss or liability by reason of such
settlement or judgment. No indemnifying party shall, without the prior written consent of the
indemnified party (which consent shall not be unreasonably withheld), effect any settlement of any
pending or threatened proceeding in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified party, unless such
settlement includes an unconditional release of such indemnified party from all liability on claims
that are the subject matter of such proceeding.

          7. Contribution. If the indemnification provided for in Section 6 is unavailable to
or insufficient to hold harmless an indemnified party under subsection (a) or (b) thereof in
respect of any losses, claims, damages or liabilities (or actions in respect thereof) referred to
therein, then each indemnifying party shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or liabilities (or actions in respect
thereof) in such proportion as is appropriate to reflect the relative benefits received by the
Company and the Guarantor on the one hand a Holder with respect to the sale by such Holder of
Securities, Exchange Securities or Private Exchange Securities, on the other. If, however, the
allocation provided by the immediately preceding sentence is not permitted by applicable law or if
the indemnified party failed to give the notice required under Section 6(c) above, then each
indemnifying party shall contribute to such amount paid or payable by such indemnified party in
such proportion as is appropriate to reflect not only such relative benefits but also the relative
fault of the Company and the Guarantor on the one hand and such Holder on the other in connection
with the statements or omissions which resulted in such losses, claims, damages or liabilities (or
actions in respect thereof), as well as any other relevant equitable considerations. The relative
benefits received by the Company and the Guarantor on the one hand and a Holder on the other shall
be deemed to be in the same proportion as the total net proceeds from the offering of the
Securities (before deducting expenses) received by the Company and the Guarantor bear to the total
proceeds received by such Holder with respect to its sale of Securities, Exchange Securities or
Private Exchange Securities, on the other. The relative fault shall be determined by reference to,
among other things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information supplied by the
Company or the Guarantor on the one hand or to any Holders’ Information supplied by such Holder on
the other and the parties’ relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission. The parties hereto agree that it would not be just
and equitable if contributions pursuant to this Section 7 were determined by pro rata allocation
(even if the Initial Purchasers were treated as one entity for such purpose) or by any other method
of allocation which does not take account of the equitable considerations referred to above in this
Section 7. The amount paid or payable by an indemnified party as a result of the losses, claims,
damages or liabilities (or actions in respect thereof) referred to above in this Section 7 shall be
deemed to include any legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending any such action or claim. Notwithstanding the provisions
of this Section 7, an indemnifying party that is a Holder of Securities, Exchange Securities or
Private Exchange Securities shall be required to contribute any amount in excess of the amount by
which the total price at which the Securities, Exchange Securities or Private Exchange Securities
sold by such

 

 

indemnifying party exceeds the amount of any damages which such Initial Purchaser has
otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation.

          8. Rules 144 and 144A. The Company and the Guarantor shall use their reasonable best
efforts to file the reports required to be filed under the Securities Act and the Exchange Act in a
timely manner and, if at any time the Company and the Guarantor are not required to file such
reports, they will, upon the written request of any Holder of Transfer Restricted Securities, make
publicly available other information so long as necessary to permit sales of such Holder’s
securities pursuant to Rules 144 and 144A. The Company and the Guarantor covenant that they will
take such further action as any Holder of Transfer Restricted Securities may reasonably request,
all to the extent required from time to time to enable such Holder to sell Transfer Restricted
Securities without registration under the Securities Act within the limitation of the exemptions
provided by Rules 144 and 144A (including, without limitation, the requirements of Rule
144A(d)(4)). Upon the written request of any Holder of Transfer Restricted Securities, the Company
and the Guarantor shall deliver to such Holder a written statement as to whether they have complied
with such requirements. Notwithstanding the foregoing, nothing in this Section 8 shall be deemed
to require the Company to register any of its securities pursuant to the Exchange Act.

          9. Underwritten Registrations. If any of the Transfer Restricted Securities covered
by any Shelf Registration Statement are to be sold in an underwritten offering, the investment
banker or investment bankers and manager or managers that will administer the offering will be
selected by the Holders of a majority in aggregate principal amount of such Transfer Restricted
Securities included in such offering, subject to the consent of the Company (which shall not be
unreasonably withheld or delayed), and such Holders shall be responsible for all underwriting
commissions and discounts in connection therewith.

          No person may participate in any underwritten registration hereunder unless such person (i)
agrees to sell such person’s Transfer Restricted Securities on the basis reasonably provided in any
underwriting arrangements approved by the persons entitled hereunder to approve such arrangements
and (ii) completes and executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents reasonably required under the terms of such underwriting
arrangements.

          10. Miscellaneous.

     (a) Amendments and Waivers. The provisions of this Agreement may not be
amended, modified or supplemented, and waivers or consents to departures from the provisions
hereof may not be given, unless the Company has obtained the written consent of Holders of a
majority in aggregate principal amount of the Securities, the Exchange Securities and the
Private Exchange Securities, taken as a single class. Notwithstanding the foregoing, a
waiver or consent to depart from the provisions hereof with respect to a matter that relates
exclusively to the rights of Holders whose Securities, Exchange Securities or Private
Exchange Securities are being sold pursuant to a Registration

 

 

Statement and that does not directly or indirectly affect the rights of other Holders
may be given by Holders of a majority in aggregate principal amount of the Securities, the
Exchange Securities and the Private Exchange Securities being sold by such Holders pursuant
to such Registration Statement.

     (b) Notices. All notices and other communications provided for or permitted
hereunder shall be made in writing by hand-delivery, first-class mail, telecopier or air
courier guaranteeing next-day delivery:

     (1) if to a Holder, at the most current address given by such Holder to the
Company in accordance with the provisions of this Section 10(b), which address
initially is, with respect to each Holder, the address of such Holder maintained by
the Registrar under the Indenture, with a copy in like manner to Goldman and Lehman;

     (2) if to an Initial Purchaser, initially at its address set forth in the
Purchase Agreement; and

     (3) if to the Company, initially at the address of the Company set forth in the
Purchase Agreement.

          All such notices and communications shall be deemed to have been duly given: when delivered by
hand, if personally delivered; one business day after being delivered to a next-day air courier;
five business days after being deposited in the mail; and when receipt is acknowledged by the
recipient’s telecopier machine, if sent by telecopier.

     (c) Successors And Assigns. This Agreement shall be binding upon the Company
and its successors and assigns.

     (d) Counterparts. This Agreement may be executed in any number of counterparts
(which may be delivered in original form or by telecopier) 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 agreement.

     (e) Definition of Terms. For purposes of this Agreement, (a) the term
“business day” means any day on which the New York Stock Exchange, Inc. is open for trading,
(b) the term “subsidiary” has the meaning set forth in Rule 405 under the Securities Act and
(c) except where otherwise expressly provided, the term “affiliate” has the meaning set
forth in Rule 405 under the Securities Act.

     (f) Headings. The headings in this Agreement are for convenience of reference
only and shall not limit or otherwise affect the meaning hereof.

     (g) GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.

 

 

     (h) Remedies. In the event of a breach by the Company, the Guarantor or by any
Holder of any of their obligations under this Agreement, each Holder, the Company or the
Guarantor, as the case may be, in addition to being entitled to exercise all rights granted
by law, including recovery of damages (other than the recovery of damages for a breach by
the Company or the Guarantor of its obligations under Sections 1 or 2 hereof for which
additional interest has been paid pursuant to Section 3 hereof), will be entitled to
specific performance of its rights under this Agreement. The Company, the Guarantor and
each Holder agree that monetary damages would not be adequate compensation for any loss
incurred by reason of a breach by each such person of any of the provisions of this
Agreement and hereby further agree that, in the event of any action for specific performance
in respect of such breach, each such person shall waive the defense that a remedy at law
would be adequate.

     (i) No Inconsistent Agreements. Each of the Company and the Guarantor
represents, warrants and agrees that (i) it has not entered into, shall not, on or after the
date of this Agreement, enter into any agreement that is inconsistent with the rights
granted to the Holders in this Agreement or otherwise conflicts with the provisions hereof,
(ii) it has not previously entered into any agreement which remains in effect granting any
registration rights with respect to any of its debt securities to any person and (iii) (with
respect to the Company) without limiting the generality of the foregoing, without the
written consent of the Holders of a majority in aggregate principal amount of the then
outstanding Transfer Restricted Securities, it shall not grant to any person the right to
request the Company to register any debt securities of the Company under the Securities Act
unless the rights so granted are not in conflict or inconsistent with the provisions of this
Agreement.

     (j) No Piggyback on Registrations. Neither the Company nor any of its security
holders (other than the Holders of Transfer Restricted Securities in such capacity) shall
have the right to include any securities of the Company in any Shelf Registration or
Registered Exchange Offer other than Transfer Restricted Securities.

     (k) Severability. The remedies provided herein are cumulative and not
exclusive of any remedies provided by law. If any term, provision, covenant or restriction
of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void
or unenforceable, the remainder of the terms, provisions, covenants and restrictions set
forth herein shall remain in full force and effect and shall in no way be affected, impaired
or invalidated, and the parties hereto shall use their reasonable best efforts to find and
employ an alternative means to achieve the same or substantially the same result as that
contemplated by such term, provision, covenant or restriction. It is hereby stipulated and
declared to be the intention of the parties that they would have executed the remaining
terms, provisions, covenants and restrictions without including any of such that may be
hereafter declared invalid, illegal, void or unenforceable.

 

 

          Please confirm that the foregoing correctly sets forth the agreement among the Company, the
Guarantor and the Initial Purchasers.

	 	 	 	 	 
	 	 	Very truly yours,
	 
	 	 	 	 
	 	 	WESCO DISTRIBUTION, INC.,
	 
	 	 	 	 
	 

	 	by
	 	/s/ Stephen A. Van Oss
	 

	 	 	 	 
	 

	 	 	 	Name: Stephen A. Van Oss
	 

	 	 	 	Title:   Sr. VP, CFO & CAO
	 
	 	 	 	 
	 	 	WESCO INTERNATIONAL, INC.,
	 
	 	 	 	 
	 

	 	by
	 	/s/ Roy W. Haley
	 

	 	 	 	 
	 

	 	 	 	Name: Roy W. Haley
	 

	 	 	 	Title:   CEO

Accepted:

GOLDMAN, SACHS & CO.

LEHMAN BROTHERS INC.

As representatives of the several Initial

Purchasers

By: GOLDMAN, SACHS & CO.,

	 	 	 	 	 
	By

	 	/s/ Goldman, Sachs & Co.	 	 
	 

	 	 	 	 
	 

	 	(Goldman, Sachs & Co.)	 	 
	 
	 	 	 	 
	By: LEHMAN BROTHERS INC.	 	 
	 
	 	 	 	 
	By
	 	/s/ Stephen Mehos 	 	 
	 

	 	 	 	 
	 

	 	Name: Stephen Mehos	 	 
	 

	 	Title: Managing Director	 	 

 

 

ANNEX A

          Each broker-dealer that receives Exchange Securities for its own account pursuant to the
Registered Exchange Offer must acknowledge that it will deliver a prospectus in connection with any
resale of such Exchange Securities. The Letter of Transmittal states that by so acknowledging and
by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an “underwriter”
within the meaning of the Securities Act. This Prospectus, as it may be amended or supplemented
from time to time, may be used by a broker-dealer in connection with resales of Exchange Securities
received in exchange for Securities where such Securities were acquired by such broker-dealer as a
result of market-making activities or other trading activities. The Company has agreed that, for a
period of 180 days after the Expiration Date (as defined herein), it will make this Prospectus
available to any broker-dealer for use in connection with any such resale. See “Plan of
Distribution.”

 

 

ANNEX B

          Each broker-dealer that receives Exchange Securities for its own account in exchange for
Securities, where such Securities were acquired by such broker-dealer as a result of market-making
activities or other trading activities, must acknowledge that it will deliver a prospectus in
connection with any resale of such Securities. See “Plan of Distribution.”

 

 

ANNEX C

PLAN OF DISTRIBUTION

          Each broker-dealer that receives Exchange Securities for its own account pursuant to the
Registered Exchange Offer must acknowledge that it will deliver a prospectus in connection with any
resale of such Exchange Securities. This Prospectus, as it may be amended or supplemented from
time to time, may be used by a broker-dealer in connection with resales of Exchange Securities
received in exchange for Securities where such Securities were acquired as a result of
market-making activities or other trading activities. The Company has agreed that, for a period of
180 days after the Expiration Date, it will make this prospectus, as amended or supplemented,
available to any broker-dealer for use in connection with any such resale. In addition, until 40
days after the later of the commencement of the offering and the Issue Date, all dealers effecting
transactions in the Exchange Securities may be required to deliver a prospectus.

          The Company will not receive any proceeds from any sale of Exchange Securities by
broker-dealers. Exchange Securities received by broker-dealers for their own account pursuant to
the Registered Exchange Offer may be sold from time to time in one or more transactions in the
over-the-counter market, in negotiated transactions, through the writing of options on the Exchange
Securities or a combination of such methods of resale, at market prices prevailing at the time of
resale, at prices related to such prevailing market prices or at negotiated prices. Any such
resale may be made directly to purchasers or to or through brokers or dealers who may receive
compensation in the form of commissions or concessions from any such broker-dealer or the
purchasers of any such Exchange Securities. Any broker-dealer that resells Exchange Securities
that were received by it for its own account pursuant to the Registered Exchange Offer and any
broker or dealer that participates in a distribution of such Exchange Securities may be deemed to
be an “underwriter” within the meaning of the Securities Act and any profit on any such resale of
Exchange Securities and any commission or concessions received by any such persons may be deemed to
be underwriting compensation under the Securities Act. The Letter of Transmittal states that, by
acknowledging that it will deliver and by delivering a prospectus, a broker-dealer will not be
deemed to admit that it is an “underwriter” within the meaning of the Securities Act.

          For a period of 180 days after the Expiration Date the Company will promptly send additional
copies of this Prospectus and any amendment or supplement to this Prospectus to any broker-dealer
that requests such documents in the Letter of Transmittal. The Company has agreed to pay all
expenses incident to the Registered Exchange Offer (including the expenses of one counsel for the
Holders of the Securities) other than commissions or concessions of any broker-dealers and will
indemnify the Holders of the Securities (including any broker-dealers) against certain liabilities,
including liabilities under the Securities Act.

 

 

ANNEX D

	 	 	 
	 

	 	[ ] CHECK HERE IF YOU ARE A BROKER-DEALER AND WISH TO RECEIVE
10 ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF ANY
AMENDMENTS OR SUPPLEMENTS THERETO.
	 
	 	 
	 

	 	Name:

Address:

If the undersigned is not a broker-dealer, the undersigned represents that it is not engaged in,
and does not intend to engage in, a distribution of Exchange Securities. If the undersigned is a
broker-dealer that will receive Exchange Securities for its own account in exchange for Securities
that were acquired as a result of market-making activities or other trading activities, it
acknowledges that it will deliver a prospectus in connection with any resale of such Exchange
Securities; however, by so acknowledging and by delivering a prospectus, the undersigned will not
be deemed to admit that it is an “underwriter” within the meaning of the Securities Act.exv10w17

 

Non-Qualified Stock Option Agreement

     This NON-QUALIFIED STOCK OPTION AGREEMENT, dated as of this ___day of                     ,
200___, by and between Energy West, Incorporated, a Montana corporation (the “Company”), and
                     (the “Optionee”).

     Pursuant to the Energy West, Incorporated 2002 Stock Option Plan (the “Plan”), the
Compensation Committee has determined that the Optionee is to be granted a Non-Qualified Stock
Option (the “Option”) to purchase shares of the Company’s common stock, on the terms and conditions
set forth herein. It is intended that the Option shall not constitute an “Incentive Stock Option”
within the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”).
Any capitalized terms not defined herein shall have the meaning set forth in the Plan.

     1. Number of Shares and Option Price. The Option entitles the Optionee to purchase
[___] shares of the Company’s common stock, par value $.15 per share (the “Option Shares”), at a
price of [___] per share (the “Option Price”).

     2. Period of Option. The term of the Option and of this Option Agreement shall
commence on the date hereof (the “Grant Date”) and terminate upon the earlier of (i) the expiration
of ___years from the Grant Date, or (ii) the occurrence of one of the events set forth under
Section 6.4.1 of the Plan. Upon termination of the Option, all rights of the Optionee hereunder
shall cease.

     3. Vesting of Options.

     Option 1: Immediate Vesting

     The Option Shares granted hereunder shall be fully vested and nonforfeitable at all times,
except as otherwise provided herein.

     The right of the Optionee to purchase Shares may be exercised in whole or in part at any time
or from time to time up to the expiration of the stated term of such Option as set forth under
Section 2 above[, but in no event earlier than ___months following the Grant Date].

     Option 2: Graduated Vesting

     For so long as the Optionee is employed by or provides services to the Company or a
Subsidiary, the Option Shares granted hereunder shall vest as follows:

     (a)                      percent (___%) of the Option Shares (rounded down to the nearest whole
number of shares) on ___;

     (b) An additional                      percent (___%) of the Option Shares (rounded down to the
nearest whole number of shares) on                     ; and

     (c) The remainder of the Option Shares on                     .

     Notwithstanding the foregoing, the Option Shares shall immediately vest, to the extent not
already vested, in the event of a Change in Control (subject to the limitations set forth in the
Plan).

 

 

     The right of the Optionee to purchase shares with respect to which this Option has become
vested as herein provided may be exercised in whole or in part at any time or from time to time up
to the expiration of the stated term of such Option as set forth under Section 2 above[, but in no
event earlier than ___months following the Grant Date].

     Option 3: Cliff Vesting

     For so long as the Optionee is employed by or provides services to the Company or a
Subsidiary, the Option Shares granted hereunder shall vest on                     . Notwithstanding the
foregoing, the Option Shares shall immediately vest, to the extent not already vested, in the event
of a Change in Control (subject to the limitations set forth in the Plan).

     The right of the Optionee to purchase shares with respect to which this Option has become
vested as herein provided may be exercised in whole or in part at any time or from time to time up
to the expiration of the stated term of such Option as set forth under Section 2 above[, but in no
event earlier than ___months following the Grant Date].

     4. Non-transferability of Option. The Option and this Option Agreement shall not be
transferable otherwise than by will or by laws of descent and distribution; and the Option may be
exercised, during the lifetime of the Optionee, only by the Optionee or by the Optionee’s legal
representative.

     5. Exercise of Option. The Option shall be exercised in the following manner: the
Optionee, or the person or persons having the right to exercise the Option upon the death or
Disability of the Optionee, shall deliver to the Company written notice specifying the number of
vested Option Shares which the Optionee elects to purchase, together with either (i) cash, (ii)
shares of Company common stock having Fair Market Value determined as of the date of exercise, or
(iii) any combination of the above, the sum of which equals the total price to be paid upon the
exercise of the Option, and the stock purchased shall thereupon be promptly delivered. The
Optionee will not be deemed to be a holder of any shares pursuant to exercise of the Option until
the date of issuance to the Optionee of a stock certificate for such shares and until the shares
are paid in full.

     6. Termination of Service.

     If the Optionee incurs a Termination of Service by the Company or a Subsidiary for Cause, the
Optionee’s unexercised Option Shares, irrespective of whether or not vested, shall be immediately
forfeited.

     If the Optionee incurs a Termination of Service due to death or Disability, the Optionee may
exercise his or her unexercised and vested Option Shares for a period of up one (1) year following
the Optionee’s Termination of Service.

     If the Optionee incurs a Termination of Service for any reason other than described in (a) or
(b) above, the Optionee may exercise his or her unexercised and vested Option Shares for a period
of up ninety (90) days after the Optionee’s Termination of Service.

     7. Notices. Any notice required or permitted under this Option Agreement shall be
deemed given when delivered personally, or when deposited in a United States Post Office, postage
prepaid, addressed, as appropriate, to the Optionee either at the Optionee’s address set forth
below or such other address as the Optionee may designate in writing to the Company, or the
Company: Attention: Board of

 

 

Directors/Corporate Secretary, at the Company’s address or such other address as the Company
may designate in writing to the Optionee.

     8. Withholding of Taxes. As a condition to the issuance of the Option Shares, the
Optionee shall (a) remit to the Company at the time of any exercise of the Option any taxes
required to be withheld by the Company under federal, state or local laws as a result of the
exercise of the Option; or (b) instruct the Company to withhold in accordance with applicable law
from any compensation payable to the Optionee the taxes required to be held by the Company under
federal, state or local laws as a result of the exercise of the Option; or (c) instruct the Company
to withhold such number of shares as are necessary for the fair market value of such shares to
equal the amount of taxes required to be withheld by the Company, under federal, state, or local
laws as a result of the exercise of the Option. The determination of the amount of any such
withholding shall be made by the Company.

     9. Failure to Enforce Not a Waiver. The failure of the Company to enforce at any time
any provision of this Option Agreement shall in no way be construed to be a waiver of such
provision or of any other provision hereof.

     10. Incorporation of Plan. The Plan is hereby incorporated by reference and made a
part hereof, and the Option and this Option Agreement are subject to all terms and conditions of
the Plan.

     11. Amendments. This Option Agreement may be amended or modified at any time by an
instrument in writing signed by the parties hereto.

     12. Successors and Assigns. This Option Agreement shall inure to the benefit of and
be binding upon the heirs, legatees, legal representatives, successors and assigns of the parties
hereto.

     IN WITNESS WHEREOF, the parties have executed this Option Agreement on the day and year first
above written.

	 	 	 	 	 	 	 
	 	 	COMPANY:	 	ENERGY WEST, INCORPORATED
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	The undersigned hereby accepts and agrees to all the
terms and provisions of the foregoing Option
Agreement and to all the terms and provisions of the
Plan herein incorporated by reference.
	 
	 	 	 	 	 	 
	 

	 	OPTIONEE:	 	 	 	 
	 	 	 	 	 

 

 

Incentive Stock Option Agreement

     This INCENTIVE STOCK OPTION AGREEMENT, dated as of this ___day of                     ,
200___, by and between Energy West, Incorporated, a Montana corporation (the “Company”), and
                     (the “Optionee”).

     Pursuant to the Energy West, Incorporated 2002 Stock Option Plan (the “Plan”), the
Compensation Committee has determined that the Optionee is to be granted an Incentive Stock Option
(the “Option”) to purchase shares of the Company’s common stock, on the terms and conditions set
forth herein. It is intended that the Option shall constitute an “Incentive Stock Option” within
the meaning of Section 422 of the Internal Revenue Code of 1986, as amended (the “Code”). Any
capitalized terms not defined herein shall have the meaning set forth in the Plan.

     1. Number of Shares and Option Price. The Option entitles the Optionee to purchase
[___] shares of the Company’s common stock, par value $.15 per share (the “Option Shares”), at a
price of [___] per share (the “Option Price”).

     2. Period of Option. The term of the Option and of this Option Agreement shall
commence on the date hereof (the “Grant Date”) and terminate upon the earlier of (i) the expiration
of                      years from the Grant Date, or (ii) the occurrence of one of the events set forth under
Section 6.4.1 of the Plan. Upon termination of the Option, all rights of the Optionee hereunder
shall cease.

     3. Vesting of Options.

Option 1: Immediate Vesting

     The Option Shares granted hereunder shall be fully vested and nonforfeitable at all times,
except as otherwise provided herein.

     The right of the Optionee to purchase Shares may be exercised in whole or in part at any time
or from time to time up to the expiration of the stated term of such Option as set forth under
Section 2 above[, but in no event earlier than ___months following the Grant Date].

Option 2: Graduated Vesting

     For so long as the Optionee is employed by or provides services to the Company or a
Subsidiary, the Option Shares granted hereunder shall vest as follows:

     (a)                      percent (___%) of the Option Shares (rounded down to the nearest whole
number of shares) on                     ;

     (b) An additional                      percent (___%) of the Option Shares (rounded down to the
nearest whole number of shares) on                     ; and

     (c) The remainder of the Option Shares on                     .

     Notwithstanding the foregoing, the Option Shares shall immediately vest, to the extent not
already vested, in the event of a Change in Control (subject to the limitations set forth in the
Plan).

 

 

     The right of the Optionee to purchase shares with respect to which this Option has become
vested as herein provided may be exercised in whole or in part at any time or from time to time up
to the expiration of the stated term of such Option as set forth under Section 2 above[, but in no
event earlier than ___months following the Grant Date].

Option 3: Cliff Vesting

     For so long as the Optionee is employed by or provides services to the Company or a
Subsidiary, the Option Shares granted hereunder shall vest on                     . Notwithstanding the
foregoing, the Option Shares shall immediately vest, to the extent not already vested, in the event
of a Change in Control (subject to the limitations set forth in the Plan).

     The right of the Optionee to purchase shares with respect to which this Option has become
vested as herein provided may be exercised in whole or in part at any time or from time to time up
to the expiration of the stated term of such Option as set forth under Section 2 above[, but in no
event earlier than ___months following the Grant Date].

     4. Non-transferability of Option. The Option and this Option Agreement shall not be
transferable otherwise than by will or by laws of descent and distribution; and the Option may be
exercised, during the lifetime of the Optionee, only by the Optionee or by the Optionee’s legal
representative.

     5. Exercise of Option. The Option shall be exercised in the following manner: the
Optionee, or the person or persons having the right to exercise the Option upon the death or
Disability of the Optionee, shall deliver to the Company written notice specifying the number of
vested Option Shares which the Optionee elects to purchase, together with either (i) cash, (ii)
shares of Company common stock having Fair Market Value determined as of the date of exercise, or
(iii) any combination of the above, the sum of which equals the total price to be paid upon the
exercise of the Option, and the stock purchased shall thereupon be promptly delivered. The
Optionee will not be deemed to be a holder of any shares pursuant to exercise of the Option until
the date of issuance to the Optionee of a stock certificate for such shares and until the shares
are paid in full.

     6. Termination of Service.

     If the Optionee incurs a Termination of Service by the Company or a Subsidiary for Cause, the
Optionee’s unexercised Option Shares, irrespective of whether or not vested, shall be immediately
forfeited.

     If the Optionee incurs a Termination of Service due to death or Disability, the Optionee may
exercise his or her unexercised and vested Option Shares for a period of up one (1) year following
the Optionee’s Termination of Service.

     If the Optionee incurs a Termination of Service for any reason other than described in (a) or
(b) above, the Optionee may exercise his or her unexercised and vested Option Shares for a period
of up ninety (90) days after the Optionee’s Termination of Service.

     7. Notices. Any notice required or permitted under this Option Agreement shall be
deemed given when delivered personally, or when deposited in a United States Post Office, postage
prepaid, addressed, as appropriate, to the Optionee either at the Optionee’s address set forth
below or such other address as the Optionee may designate in writing to the Company, or the
Company: Attention: Board of

 

 

Directors/Corporate Secretary, at the Company’s address or such other address as the Company
may designate in writing to the Optionee.

     8. Withholding of Taxes. As a condition to the issuance of the Option Shares, the
Optionee shall (a) remit to the Company at the time of any exercise of the Option any taxes
required to be withheld by the Company under federal, state or local laws as a result of the
exercise of the Option; or (b) instruct the Company to withhold in accordance with applicable law
from any compensation payable to the Optionee the taxes required to be held by the Company under
federal, state or local laws as a result of the exercise of the Option; or (c) instruct the Company
to withhold such number of shares as are necessary for the fair market value of such shares to
equal the amount of taxes required to be withheld by the Company, under federal, state, or local
laws as a result of the exercise of the Option. The determination of the amount of any such
withholding shall be made by the Company.

     9. Disposition of Option Shares. It is understood that this Option is intended to
qualify as an “Incentive Stock Option” as defined in Section 422 of the Code. Accordingly, the
Optionee understands that in order to obtain the benefits of an incentive stock option under
Section 421 of the Code, no sale or other disposition may be made of any Shares acquired upon
exercise of the Option within one (1) year after the day of the transfer of such Shares to the
Optionee, nor within two (2) years after the Grant Date of the Option. If the Optionee disposes
(whether by sale, exchange, gift, transfer or otherwise), of any such Shares within said periods,
the Optionee will notify the Company in writing within ten (10) days after such disposition.

     10. Failure to Enforce Not a Waiver. The failure of the Company to enforce at any
time any provision of this Option Agreement shall in no way be construed to be a waiver of such
provision or of any other provision hereof.

     11. Incorporation of Plan. The Plan is hereby incorporated by reference and made a
part hereof, and the Option and this Option Agreement are subject to all terms and conditions of
the Plan.

     12. Amendments. This Option Agreement may be amended or modified at any time by an
instrument in writing signed by the parties hereto.

     13. Successors and Assigns. This Option Agreement shall inure to the benefit of and
be binding upon the heirs, legatees, legal representatives, successors and assigns of the parties
hereto.

 

 

     IN WITNESS WHEREOF, the parties have executed this Option Agreement on the day and year first
above written.

	 	 	 	 	 	 	 
	 	 	COMPANY:	 	ENERGY WEST, INCORPORATED
	 
	 	 	 	 	 	 
	 

	 	 	 	By:	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	Title:	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 	The undersigned hereby accepts and agrees to all the
terms and provisions of the foregoing Option
Agreement and to all the terms and provisions of the
Plan herein incorporated by reference.
	 
	 	 	 	 	 	 
	 

	 	OPTIONEE:

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