Document:

Exhibit 10.9

 

UHS HOLDCO, INC.

 

SECURITYHOLDERS AGREEMENT

 

THIS SECURITYHOLDERS AGREEMENT (the “Agreement”)
is made as of May 31, 2007, by and among (i) UHS Holdco, Inc., a
Delaware corporation (the “Company”),
(ii) BSMB/UHS, L.P., a Delaware limited partnership (“BSMB/UHS”) and BSMB/UHS Co-Investment
Partners, L.P., a Delaware limited partnership (“BSMB Co-Investment” and, together with BSMB/UHS, “BSMB”), (iii) Gary D. Blackford and
Kathy Blackford (collectively, “Blackford”)
and (iv) each of the other Persons whose names appear on the Schedule of
Investors attached hereto (the “Schedule of
Investors”), as amended from time to time in accordance with the
terms hereof (the “Other Holders”),
and each Person who after the date hereof acquires Common Stock and Common
Stock Equivalents and agrees to be bound by this Agreement by executing a
joinder to this Agreement substantially in the form of Exhibit A
hereto.  Capitalized terms used herein
are defined in Section 12.

 

WHEREAS, BSMB has acquired the shares of Common Stock set forth
opposite its name on the Schedule of Investors;

 

WHEREAS, each of Blackford and the Other Holders has acquired the
shares of Common Stock set forth opposite its, his or her name on the Schedule
of Investors;

 

WHEREAS, the Company and the Securityholders desire to enter into this
Agreement for the purposes, among others, of (i) establishing the composition
of the Company’s Board of Directors (the “Board”), (ii)
assuring continuity in the management and ownership of the Company and (iii) limiting
the manner and terms by which the Securityholder Shares may be Transferred.

 

NOW, THEREFORE, in consideration of the mutual covenants contained
herein and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties to this Agreement hereby agree as
follows:

 

1.     Voting
Agreement.

 

(a)   Board
of Directors. Each Securityholder hereby agrees that such Person shall
vote, or cause to be voted, all voting securities of the Company over which
such Person has the power to vote or direct the voting, and shall take all
other reasonably necessary or desirable actions within such Person’s control
(whether in such Person’s capacity as a stockholder, director, member of a
board committee or officer of the Company or otherwise, and including, without
limitation, attendance at meetings in person, via telephone or by proxy for
purposes of obtaining a quorum and execution of written consents in lieu of
meetings), and the Company shall take all reasonably necessary or desirable
actions within its control (including, without limitation, calling special
board and stockholder meetings), so that:

 

(i)            the size
of the Board shall initially be four (4) directors and the following
individuals shall be elected to the Board and caused to be continued in office:

 

 

(A)  three (3)
representatives designated by the BSMB Majority Holders (the “BSMB Directors”); and

 

(B)   the then duly
elected chief executive officer of UHS (“CEO”),
who shall initially be Gary D. Blackford; provided, that in the event
that Gary D. Blackford’s employment with the Company or any of its Subsidiaries
terminates for any reason (other than as a result of the death of, disability
of, or conviction of a felony by, Gary D. Blackford), Gary D. Blackford shall
be entitled to either, at the election of the BSMB Majority Holders, remain as
a member of the Board or attend each meeting of the Board as a non-voting
observer so long as (i) Blackford continues to own at least 50% of the Common
Stock held by Blackford on the date hereof and (ii) Gary D. Blackford is not
employed by, or consulting for, any competitor of the Company or any of its
Subsidiaries.

 

(ii)           the
composition of the board of directors of each of the Company’s Subsidiaries, if
any (each, a “Sub Board”), shall be determined
by the same formula as that of the Board;

 

(iii)          the
composition of any committee of the Board or any Sub Board shall not exceed
four (4) members and (1) unless otherwise waived by the BSMB Majority Holders,
shall include at least two BSMB Directors and (2) for so long as he is a
director, shall include the CEO, unless waived by him or unless the Board or
such Sub Board desires to exclude officers from such committee;

 

(iv)          a
representative to the Board or a Sub Board designated by any Securityholder
pursuant to the terms of this Section 1 may be removed from the
Board or such Sub Board (with or without cause) only in accordance with the
Company’s or such Subsidiary’s bylaws and only upon such Securityholder’s
written request;

 

(v)           in the
event that any representative designated (or subject to approval) hereunder by
any Securityholder (or Securityholders) ceases to serve as a member of the
Board, a Sub Board or a committee during his or her term of office (whether due
to resignation, removal or otherwise), the resulting vacancy on the Board or
the Sub Board shall be filled by a representative designated (and approved) by
the Securityholder(s) originally entitled to designate (or approve) such
director pursuant to Section 1(a)(i) or Section 1(a)(vii);

 

(vi)          if any
party fails to designate a representative to fill a directorship pursuant to
the terms of this Section 1, neither the Board nor the
Securityholders may elect, and the Securityholders shall not vote to elect, any
Person to fill such vacant directorship without the prior written consent of
the Securityholder(s) originally entitled to designate (or approve) such
director pursuant to Section 1(a)(i) or Section 1(a)(vii);

 

(vii)         the
size of the Board shall be increased at the election of the Board and the
individuals designated by the BSMB Majority Holders shall be elected to the
Board and caused to be continued in office to fill the vacancies created
thereby; and

 

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(viii)        the
bylaws of the Company and of each of the Company’s Subsidiaries shall provide
that, except as otherwise provided by law, no quorum shall exist at any meeting
of the Board or any Sub Board unless directors having a majority of the voting
power of such board of directors are present at such meeting.

 

(b)   The
Company shall pay the reasonable out-of-pocket expenses incurred by
each director in connection with attending the meetings of the Board, any Sub
Board and any committee thereof.

 

(c)   Any
member of the Board who is not an employee of the Company, BSMB or any other
Securityholder or any of their respective Affiliates (other than an employee of
a portfolio company of an investment fund sponsored by BSMB or its Affiliates
that is not the Company) may be entitled to receive director fees in the amount
and form determined by the Board that are commensurate with the
responsibilities of such member.

 

2      Representations
and Warranties.  Each Securityholder
represents and warrants to the Company and each other Securityholder that (a) immediately
following the Effective Time, such Securityholder is the record owner of the
number of Securityholder Shares set forth opposite such Securityholder’s name
on the Schedule of Investors attached hereto; (b) this Agreement has been
duly authorized, executed and delivered by such Securityholder and constitutes
the valid and binding obligation of such Securityholder, enforceable in
accordance with its terms; and (c) such Securityholder has not granted and is
not a party to any proxy, voting trust or other agreement which is inconsistent
with, conflicts with or violates any provision of this Agreement.  No holder of Securityholder Shares, in its
capacity as such, shall grant any proxy or become party to any voting trust or
other agreement which is inconsistent with, conflicts with or violates any
provision of this Agreement.

 

3.     Restrictions on Transfer
of Securityholder Shares.

 

(a)   Transfer
of Securityholder Shares.  No
Securityholder (other than the BSMB Investors) may Transfer any interest in
such Person’s Securityholders Shares other than pursuant to Section 3(b),
Section 3(c), Section 3(d), Section 4,  Section 5
or Section 10 (an “Exempt
Transfer”).  No Securityholder
may pledge, hypothecate, grant a security interest in, or otherwise encumber
such Person’s Securityholders Shares except with the written consent of the
Company.

 

(b)   Right of First Refusal.

 

(i)            Any
Management Holder (a “Transferring Holder”)
that receives a bona fide offer to purchase such Person’s Shares and proposes
to Transfer such Securityholder Shares (other than any Transfer (x) as a
Participation Securityholder pursuant to 
Section 3(c) or (y) pursuant to Section 3(d), Section 4,
Section 5 or Section 10) shall deliver a written notice
(an “Offer Notice”) (1) to the Company,
(2) to BSMB on behalf of the BSMB Investors, and (3) to the Blackford
Investors (for purposes of this Section 3(b), the BSMB Investors
and the Blackford Investors are collectively referred to as the “Offerees”) at least 45 days prior to making such Transfer
(such 45-day period, the “Election Period”).  The Offer Notice shall disclose in reasonable
detail the proposed number and type of Securityholder Shares to be Transferred,
the proposed

 

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terms and conditions
of the Transfer and the identity of the prospective Transferee(s).  The Company may elect to purchase all or any
portion of the Securityholder Shares specified in the Offer Notice at the price
and on the terms specified therein by delivering written notice of such
election to the Transferring Holder and the Offerees as soon as practical but
in any event within 20 days after the delivery of the Offer Notice.  If the Company has not elected to purchase
all of the Securityholder Shares within such 20-day period, the Offerees may
elect to purchase (on a pro rata basis based on the number of shares of Common
Stock owned by each Offeree at the time of determination, including shares of
Common Stock to be acquired pursuant to vested options) all of the Securityholder
Shares specified in the Offer Notice which the Company has not elected to
purchase at the price and on the terms specified therein by delivering written
notice of such election to the Transferring Holder and to the Company as soon as practical but in any event
within 45 days after delivery of the Offer Notice. Any Securityholder Shares
not elected to be purchased by any Offeree by the end of such 45-day period
shall be reoffered for the five-day period prior to the expiration of the
Election Period by the Transferring Holder to the other Offerees (on a pro rata
basis based on the number of shares of Common Stock owned by each Offeree at
the time of determination, including shares of Common Stock to be acquired
pursuant to vested options) and the Company. 
If the Company and/or the Offerees have elected to purchase all of the
Securityholder Shares from the Transferring Holder, the Transfer of such
Securityholder Shares shall be consummated as soon as practical after the
delivery of the election notice(s) to the Transferring Holder, but in any event
within 45 days after the expiration of the Election Period.

 

(ii)           If the
Company and the Offerees have not elected to purchase all of the Securityholder
Shares being offered in the Purchase Notice, the Transferring Holder may,
within 180 days after the expiration of the Election Period and subject to the
other provisions of Section 3, Transfer the Securityholder Shares
to one or more third parties at a price no less than the price per share
specified in the Offer Notice and on other terms that are not more favorable in
the aggregate to the Transferees thereof than those that were offered to the
Company and the Offerees in the Offer Notice unless the Transferring Holder
shall first have delivered a second notice setting forth such more favorable
terms (the “Amended Offer Notice”) to the Company
and the Offerees.  If the Transferring
Holder delivers an Amended Offer Notice, the Company and, if the Company elects
not to, the Offerees may elect to acquire all of the Securityholder Shares
specified in the Amended Offer Notice by delivering written notice to the
Transferring Holder not later than the later of (1) 45 days after delivery
of the Offer Notice or (2) 10 Business Days after delivery of the Amended
Offer Notice.  Any Securityholder Shares
not Transferred within such 180-day period must be reoffered to the Company and
the Offerees pursuant to this Section 3(b) prior to any subsequent
Transfer.  The Offer Notice must specify
whether the purchase price shall be payable solely in cash at the closing of
the transaction or in installments over time.

 

(c)   Co-Sale Rights.

 

(i)            Any
Securityholder (the “Section 3(c)
Transferring Securityholder”) that proposes to Transfer
Securityholder Shares (other than in a Transfer

 

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of Excluded
Securities or a Transfer pursuant to Section 3(b), Section 3(d),
Section 4, Section 5 or Section 10, as
applicable) shall deliver a written notice (the “Sale Notice”)
to the Company and to the Securityholders (the “Participation
Securityholders”) at least 30 days prior to making such Transfer,
specifying in reasonable detail the identity of the prospective Transferee(s)
(to the extent known), the number and type of shares to be Transferred and the
terms and conditions of the Transfer. 
Each Participation Securityholder
may elect to participate in the contemplated Transfer at the same price per
share and on the same terms and conditions by delivering written notice to the
Section 3(c) Transferring Securityholder
within 15 days after delivery of the Sale Notice, which notice shall become
irrevocable after the expiration of such 15-day period and  shall specify the number of Securityholder
Shares that such Participation Securityholder
desires to include in such proposed Transfer; provided,
that each Participation Securityholder
shall be required, as a condition to being permitted to sell Securityholder
Shares pursuant to this Section 3(c), to elect to sell
Securityholder Shares of the same type and class  and
in the same relative proportions (which proportions shall be determined on a
share for share basis) as the Securityholder Shares being Transferred by the
Section 3(c) Transferring Securityholder.  If none of the Participation Securityholders gives such notice
prior to the expiration of the 15-day period for giving such notice, then the
Section 3(c) Transferring Securityholders may Transfer Securityholder
Shares to any Person at a price no greater, and on other terms and conditions
that are not more favorable in the aggregate to the Section 3(c)
Transferring Securityholder
than those set forth in the Sale Notice at any time within 180 days after
expiration of such 15-day period for giving notice.  Any such Securityholder Shares not
Transferred by the Section 3(c) Transferring Securityholder during such 180-day period shall again be subject
to the provisions of this Section 3(c) upon subsequent
Transfer.  If any Participation Securityholders have elected to
participate in such Transfer, the Participation Securityholders shall be entitled to sell in the contemplated
Transfer, at the same price and on the same terms as the Section 3(c)
Transferring Securityholder, a
portion of the total number of each class of Securityholder Shares to be sold in the Transfer, to be
calculated according to the following formula: the number of Securityholder Shares of such class
that a participating Participation Securityholder
may sell equals the total number of Securityholder Shares of such class to be sold in the Transfer, multiplied
by a fraction (1)  the numerator of which is the number of Securityholder Shares of such class
owned by such Participation Securityholder
(including the number of Securityholder Shares, if any, issuable upon
the exercise of any option that has vested at the time of determination or that
will become vested as a result of such Transfer, pursuant to the terms of the
Stock Option Plan and the option agreement applicable to such options), and (2)
the denominator of which is the number of Securityholder Shares of such class owned, in the aggregate, by
the Section 3(c) Transferring Securityholder
and all participating Participation Securityholders
(including the number of Securityholder Shares, if any, issuable upon the
exercise of any option that has vested at the time of determination or that
will become vested as a result of such Transfer, pursuant to the Stock Option
Plan and the option agreement applicable to such options).

 

(ii)           Notwithstanding
anything to the contrary herein, the Section 3(c) Transferring Securityholder shall not consummate
the Transfer contemplated by the Sale 

 

5

 

Notice on terms
materially more favorable in the aggregate to it than those set forth in the
Sale Notice (including, without limitation, as to price per share or form of
consideration to be received) unless the Section 3(c) Transferring Securityholder shall first have
delivered a second notice setting forth such materially more favorable terms
(the “Amended Sale Notice”) to each
Participation Securityholder
who had not elected to participate in the contemplated Transfer.  Each Participation Securityholder receiving an Amended Sale Notice may elect to
participate in the contemplated Transfer on such amended terms by delivering
written notice to the Section 3(c) Transferring Securityholder not later than ten (10) Business Days after
delivery of the Amended Sale Notice.

 

(iii)          No
Section 3(c) Transferring Securityholder
shall Transfer any of its Securityholder Shares to any prospective Transferee
if such prospective Transferee(s) declines to allow the participation of the
electing Participation Securityholders,
unless the Section 3(c) Transferring Securityholder acquires from each
electing Participation Securityholder the number of Securityholder Shares such
electing Participation Securityholder would have been entitled to transfer to
the prospective Transferee (or, if less, the number of Securityholder Shares
that such Participation Securityholder requested to Transfer to such Transferee)
for cash and on the same terms and conditions and at the same price per share
paid by the Transferee.  If the Transfer
pursuant to this Section 3(c) is actually consummated, each Securityholder Transferring
Securityholder Shares pursuant to this Section 3(c) shall pay its
own costs of any sale and a pro rata share (based on the relative consideration
to be received in respect of the Securityholder
Shares to be sold) of the expenses incurred by the Securityholders (to the extent such costs are incurred for the
benefit of all Securityholders and are not otherwise paid by the Company or the
Transferee).  Each Securityholder
Transferring Securityholder Shares pursuant to this Section 3(c)
shall be obligated to provide the same representations, warranties, covenants,
and agreements and to join on a pro rata basis (based on the relative
consideration to be received in respect of the Securityholder Shares to be sold) in any indemnification or
other obligations that the Section 3(c) Transferring Securityholder agrees to provide in
connection with such Transfer (other than any such obligations that relate
specifically to a particular Securityholder
such as indemnification with respect to representations and warranties given by
a Securityholder regarding such
Securityholder’s title to and
ownership of such Securityholder’s
Securityholder Shares); provided,
that (i) no indemnification obligation of any Securityholder shall exceed the
aggregate net consideration to be received by such Securityholder in connection
with such Transfer, (ii) no Securityholder which is an institutional investor
or investment fund shall be required to enter into any non-competition,
non-solicitation or similar arrangement which survives the closing of such
Transfer, and (iii) no Securityholder shall be required to enter into a new
non-competition, non-solicitation or similar arrangement which survives the
closing of such Transfer that is more restrictive than any non-competition,
non-solicitation or similar arrangement to which such Securityholder is subject
prior to the consummation of such Transfer.

 

(iv)          No Securityholder Shares that have been Transferred in a Transfer
pursuant to the provisions of Section 3(c) (“Excluded Securities”) shall be
subject again to the restrictions set forth in this Section 3(c), nor shall any Securityholder holding 

 

6

 

Excluded Securities be entitled to exercise any rights as a Participation
Securityholder under this Section 3(c) with respect to such Excluded Securities,
and no Excluded Securities held by a Securityholder
shall be counted in determining the respective participation rights of
the Section 3(c) Transferring Securityholder and the Participation Securityholders in a Transfer subject
to Section 3(c).

 

(d)   Permitted
Transfers.  The restrictions set
forth in this Section 3 shall not apply with respect to any
Transfer of Securityholder
Shares by any Securityholder (i) in
the case of any Securityholder who is a natural person or a grantor retained
annuity trust, (A) pursuant to applicable laws of descent and distribution or
to or among members of such Securityholder’s or grantor’s Family (provided,
that in the case of a Transfer by a Securityholder to a member of his Family
(other than a member of his Family that is also a Securityholder on the date of
this Agreement), such Securityholder retains the right to vote and direct the
disposition of such Securityholder Shares) or (B) for estate planning purposes
or (ii) by any BSMB Investor to any member of the BSMB Group (all
Transferees under (i) and (ii) are collectively referred to herein as “Permitted Transferees”). 
If any Securityholder Transfers Securityholder Shares to an Affiliate
and an event occurs which causes such Affiliate to cease to be an Affiliate of
such Securityholder, then, unless prior to such event, such Affiliate Transfers
such Securityholder Shares back to such Securityholder, such event shall be
deemed a Transfer of Securityholder Shares subject to all of the restrictions
on Transfers of Securityholder Shares set forth in this Agreement, including
without limitation, this Section 3.

 

(e)   Transferees
Bound by Agreement.  Prior to
Transferring any Securityholder Shares (other than pursuant to a Public Sale or
a Company Sale) to any Person, except as otherwise specifically set forth in
this Agreement, the Transferring holders of Securityholder Shares shall cause
the prospective Transferee to be bound by this Agreement to the same extent as
such Transferring holders and to execute and deliver to the Company and the
holders of Securityholder
Shares a joinder to this Agreement substantially in the form of Exhibit A
hereto.   The Company shall have the
right to require, as a condition to any Transfer, receipt of an opinion of
counsel, which opinion and counsel shall be reasonably satisfactory to the
Company, to the effect that such Transfer is not required to be registered
under the Securities Act and is not in violation of any applicable laws.

 

(f)    Transfers
in Violation of Agreement.  Any
Transfer or attempted Transfer of any Securityholder Shares in violation of any
provision of this Agreement shall be void, and the Company shall not register
the Transfer of such Securityholder Shares on its books or treat any purported
Transferee of such Securityholder Shares as the owner of such Securityholder
Shares for any purpose.

 

(g)   Termination
of Restrictions.  The restrictions on
the Transfer of Securityholder
Shares set forth in this Section 3 shall continue with respect to
each applicable Securityholder
Share until the earliest of the consummation of a Company Sale or an IPO.

 

4.     Take-Along Rights.

 

(a)   If
the BSMB Majority Holders elect
to consummate, or to cause the Company to consummate, a transaction
constituting a Company Sale, then, the BSMB Majority Holders 

 

7

 

shall notify the Company and the other Securityholders in writing at least 30 days prior to the
consummation of such transaction of their election to exercise their rights
under this Section 4.  If the
BSMB Majority Holders deliver such notice, then, subject to this Section 4(a),
the other Securityholders shall
vote for, consent to, and raise no objections to the proposed transaction, and
the Securityholders (including
the BSMB Investors) and the Company shall take all other actions necessary to
cause the consummation of such Company Sale on the terms proposed by the BSMB
Majority Holders.  Without limiting the
foregoing, (i) if the proposed Company Sale is structured as a sale of
assets or a merger or consolidation, each Securityholder shall vote or cause to be voted all Securityholder Shares that such Securityholder holds or with respect
to which such Securityholder
has the power to direct the voting and which are entitled to vote on such transaction
in favor of such transaction and shall waive any dissenter’s rights, appraisal
rights or similar rights which such Securityholder
may have in connection therewith, (ii) if the proposed Company Sale is
structured as or involves a sale or redemption of Securityholder Shares, the Securityholders shall agree to sell their pro rata share of Securityholder Shares being sold in
such Company Sale on substantially the terms and conditions approved by and
applicable to the BSMB Majority Holders, and such Securityholders shall execute all documents reasonably required
to effectuate such Company Sale and approved by the BSMB Majority Holders in
connection with such Company Sale, (iii) each Securityholder shall be obligated
to provide the same representations, warranties, covenants and agreements that
the BSMB Majority Holders agree to provide in connection with such Company Sale
(except that each Securityholder shall be obligated to provide any such
obligations that relate specifically to a particular Securityholder such as representations and warranties given by a
Securityholder regarding such Securityholder’s title to and
ownership of such Securityholder’s
Securityholder Shares), (iv)
each Securityholder shall be obligated to join on a pro rata basis (based on the
relative consideration to be received by each such Securityholder) in any
indemnification or other obligations that the BSMB Majority Holders agree to
provide in connection with such Company Sale (other than any such obligations
that relate specifically to a particular Securityholder
such as indemnification with respect to representations and warranties given by
a Securityholder regarding such
Securityholder’s title to and
ownership of such Securityholder’s
Securityholder Shares); provided,
that the indemnification obligation of each Securityholder shall not exceed the
aggregate net consideration to be received by such Securityholder, (v) no
Securityholder which is an institutional investor or investment fund shall be
required to enter into any non-competition, non-solicitation or similar
arrangement which survives the closing of such Transfer, and (vi) no
Securityholder shall be required to enter into a new non-competition,
non-solicitation or similar arrangement which survives the consummation of such
Company Sale that is more restrictive than any non-competition,
non-solicitation or similar arrangement to which such Securityholder is subject
prior to the consummation of such Company Sale.

 

(b)   The
obligations of the Securityholders
with respect to the Company Sale are subject to the condition that upon the
consummation of the Company Sale, all of the holders of a particular class or
series of Securityholder Shares
shall receive the same form and amount of consideration per share or if any
holders of a particular class or series of Securityholder Shares are given an option as to the form and
amount of consideration to be received, all holders of such class or series
shall be given the same option.  In
addition, the Company shall have the right to require that all holders of then
currently exercisable rights to acquire a particular class or series of Securityholder Shares shall be given
an opportunity, at the Securityholder’s option, to either (i) exercise
such rights prior to the consummation of the Company Sale and participate in
such 

 

8

 

sale as holders of such Securityholder
Shares or (ii) upon the consummation of the Company Sale, receive in
exchange for such rights consideration equal to the amount determined by
multiplying (1) the same amount of consideration per share or amount of Securityholder Shares received by the
holders of such type and class of Securityholder
Shares in connection with the Company Sale less the exercise price per share or
amount of such rights to acquire such Securityholder
Shares by (2) the number of shares or aggregate amount of Securityholder Shares represented by
such rights.  In no event shall any
amounts payable to Bear Stearns Merchant Manager III (Cayman), L.P. (or its
designees) pursuant to the Professional Services Agreement be deemed
consideration received by BSMB hereunder.

 

(c)   If
a Company Sale is consummated, then each Securityholder
shall bear such Person’s pro rata share (based upon the relative amount of
consideration received by such Securityholder)
of the costs of any sale of Securityholder
Shares pursuant to a Company Sale to the extent such costs are incurred for the
benefit of all Securityholders
and are not otherwise paid by the Company or the acquiring party.  Costs incurred by or on behalf of a Securityholder for such Person’s sole
benefit shall not be considered costs of the transaction hereunder.  In the event that any transaction that the
Company or a BSMB Investor, as applicable, elects to consummate or cause to be
consummated pursuant to this Section 4 is not consummated for any
reason, the Company shall reimburse the BSMB Investor for all actual and
reasonable expenses paid or incurred by the BSMB Investor in connection
therewith. Notwithstanding anything to the contrary herein, the Company shall
reimburse the Management Holders for the actual and reasonable fees and
out-of-pocket expenses of one (1) legal counsel retained by the Management
Holders solely in connection with such counsel’s review and negotiation of the
definitive agreement with respect to such Company Sale; provided, that
such amounts (i) shall not include any fees or expenses incurred in connection
with any new employment agreements, option agreements, or any other equity
documents and (ii) shall not exceed $50,000 in the aggregate.

 

(d)   The
take-along right of the BSMB Majority Holders set forth in this Section 4
shall terminate upon the consummation of a Company Sale or an IPO.

 

5.     Registration Rights.

 

5A   Demand Registrations.

 

(a)   Subject
to the provisions of this Section 5 (including the restrictions set
forth in Section 5A(d)), each of the BSMB Requesting Holders shall
have the right (the “Demand Right”)
to request registration under the Securities Act of all or any portion of the
Registrable Securities held by such BSMB Requesting Holder(s) by delivering a
written notice to the principal business office of the Company, which notice
identifies the BSMB Requesting Holders and specifies the number of Registrable
Securities to be included in such registration (the “Registration Request”). 
The Company shall give prompt written notice of such Registration
Request in accordance with Section 5B(a) (the “Registration Notice”) to all other holders
of Registrable Securities and shall thereupon use its best efforts to effect
the registration (a “Demand Registration”)
under the Securities Act on any form available to the Company of:

 

9

 

(i)            the
Registrable Securities requested to be registered by the BSMB Requesting Holder
and all other Registrable Securities which the Company has received a written
request to register within 15 days after the Registration Notice is given;

 

(ii)           any
securities of the Company proposed to be included in such registration by the
Company for its own account; and

 

(iii)          any
Common Stock of the Company proposed to be included in such registration by the
holders of any registration rights granted other than pursuant to this
Agreement (“Other Registration Rights”).

 

(b)   A
registration undertaken by the Company at the request of the BSMB Requesting
Holder shall not count as a Demand Registration for purposes of Section 5A(d):

 

(i)            if,
pursuant to the Demand Right, the BSMB Requesting Holders fail to register and
sell at least 85% of the Registrable Securities requested to be included in
such registration by them; or

 

(ii)           if the
BSMB Requesting Holders withdraw a Registration Request (1) upon the
determination of the Board to postpone the filing or effectiveness of a
Registration Statement pursuant to Section 5A(d) or (2) upon
the recommendation of the managing underwriter of such offering due to
discovery of a material adverse development regarding the Company or its
Subsidiaries or general adverse economic or market conditions which, in such
underwriter’s opinion and in either case, are reasonably likely to materially
and adversely affect the price that could be obtained for such securities or
the marketability thereof.

 

(c)   If
the sole or managing underwriter of a Demand Registration advises the Company
in writing that in its opinion the number of Registrable Securities and other
securities requested to be included exceeds the number of Registrable
Securities and other securities which can be sold in such offering without
adversely affecting the distribution of the securities being offered, the price
that will be paid in such offering, or the marketability of such securities,
then the Company shall include in such registration in the following order of
priority:

 

(i)            first,
the greatest number of Registrable Securities proposed to be registered which
in the opinion of such underwriters can be so sold, such amount to be allocated
ratably among each BSMB Requesting Holder and each Securityholder based on the
amount of Registrable Securities held by each such BSMB Requesting Holder and
Securityholder (or, if any BSMB Requesting Holder or any Securityholder does
not request to include its ratable share, such excess shall be allocated
ratably among those BSMB Requesting Holders and those Securityholders
requesting to include more than their allocable share);

 

(ii)           second,
after all Registrable Securities that the BSMB Requesting Holders and the
Securityholders propose to register, the greatest number of securities proposed
to be registered by Persons with Other Registration Rights which in the opinion
of such underwriters can be so sold, such amount to be allocated ratably among
the respective holders thereof based on the amount of securities held by each
such holder (or, 

 

10

 

if any holder does
not request to include its ratable share, such excess shall be allocated
ratably among those holders requesting to include more than their allocable
share); and

 

(iii)          third,
after all securities that the BSMB Requesting Holders, the Securityholders and
the Persons with Other Registration Rights propose to register, the greatest
number of securities proposed to be registered by the Company for its own
account, which in the opinion of such underwriters can be so sold; provided,
however, that the Company shall have the right (the “Priority Right”) to receive priority over
all holders of Registrable Securities and Persons with Other Registration
Rights (other than BSMB Requesting Holders) in any Demand Registration to be
effected under this Section 5A with respect to securities that the
Company proposes to include in such registration for its own account by giving
written notice of its election to exercise such Priority Right to such Persons
and to the Requesting Holders; and thereafter, priority will be as set forth in
(i)- (ii) above.

 

(d)   The
Company shall be obligated to effect a maximum of four (4) Demand Registrations
on Form S-1 or Form S-2 (or similar long-form registration forms) and an
unlimited number of registrations on Form S-3 (or similar short-form
registration forms) for the BSMB Investors. 
Any Demand Registration requested must be for a firmly underwritten
Public Offering (to be managed by an underwriter or underwriters of recognized
national standing selected by the BSMB Requesting Holders and reasonably
acceptable to the Company).  The Company
shall not be obligated to effect any Demand Registration within a period of six
(6) months after the effective date of any previous Registration Statement.  The Company may defer not more than two (2)
times for a period not to exceed 90 days in the aggregate during any 12-month
period from each receipt of the request to file a Registration Statement for a
Demand Registration if the Board in good faith determines that such Demand
Registration might reasonably be expected to have a materially adverse effect
on any proposal or plan by the Company or any of its Subsidiaries to engage in
any acquisition of assets (other than in the ordinary course of business) or
any merger, consolidation, tender offer or other material transactions; provided,
that in such event, the BSMB Requesting Holders shall be entitled to withdraw
such request and, if such request is withdrawn, such Demand Registration shall
not count as a Demand Registration.

 

(e)   In
connection with any Demand Registration pursuant to this Section 5A,
each party to this Agreement shall vote, or cause to be voted, all securities
of the Company over which it has the power to vote or direct the voting to
effect any stock split which, in the opinion of the sole or managing
underwriter, is necessary to facilitate the effectiveness of such Demand
Registration.

 

(f)    Any
holder of Registrable Securities shall be entitled to withdraw such holder’s
request to participate in any Demand Registration that is an underwritten
offering at any time prior to the execution and delivery of the related
underwriting agreement.

 

5B   Incidental Registration.

 

(a)   At any time the
Company proposes or is required to register any shares of Common Stock pursuant
to a Registration Statement under the Securities Act (other than in 

 

11

 

connection with a
business acquisition or combination, an employee benefit plan or an IPO),
whether in connection with a primary or secondary offering, the Company shall
give written notice to each holder of Registrable Securities at least 20 days
prior to the initial filing of such Registration Statement with the SEC of the
Company’s intent to file such Registration Statement, the estimated price of
the Registrable Securities to be sold in such offering, and of such holder’s
rights under this Section 5B. 
Upon the written request of any holder of Registrable Securities made
within 15 days after any such notice is given (which request shall specify the
Registrable Securities intended to be disposed of by such holder), the Company
shall use its reasonable best efforts to effect the registration (an “Incidental Registration”) under the
Securities Act of all Registrable Securities which the Company has been so
requested to register by the holders thereof; provided, however,
that if, at any time after giving written notice of its intention to register
any securities and prior to the effective date of the Registration Statement
filed in connection with such Incidental Registration, the Company shall
determine for any reason not to register or to delay registration of such
securities, the Company may, at its election, give written notice of such
determination to each holder of Registrable Securities and, thereupon,
(i) in the case of a determination not to register, the Company shall be
relieved of its obligation to register any Registrable Securities under this Section 5B
in connection with such registration (but not from its obligation to pay the
expenses incurred in connection therewith) and (ii) in the case of a
determination to delay registration, the Company shall be permitted to delay
registering any Registrable Securities under this Section 5B during
the period that the registration of such other securities is delayed.

 

(b)   If the sole or
managing underwriter of an Incidental Registration advises the Company in
writing that in its opinion the number of Registrable Securities and other
securities requested to be included exceeds the number of Registrable
Securities and other securities which can be sold in such offering without
adversely affecting the distribution of the securities being offered, the price
that will be paid in such offering or the marketability of such securities,
then the Company shall include in such Incidental Registration the Registrable
Securities and other securities of the Company in the following order of
priority:

 

(i)            first,
the greatest number of securities of the Company proposed to be included in
such registration by the Company for its own account, which in the opinion of
such underwriters can be so sold;

 

(ii)           second,
after all of the securities that the Company proposes to register, the greatest
number of Registrable Securities proposed to be registered by the
Securityholders which in the opinion of such underwriters can be so sold, such
amount to be allocated ratably among the Securityholders based on the amount of
Registrable Securities held by each such Securityholders (or, if any Securityholders
does not request to include its ratable share, such excess shall be allocated
ratably among those Securityholders requesting to include more than their
allocable share); and

 

(iii)          third,
after all securities that the Company and Securityholders propose to register,
the greatest number of securities held by Persons with Other Registration
Rights requested to be registered by the holders thereof which in the opinion
of such underwriters can be so sold, such amount to be allocated ratably among
the respective holders thereof based on the amount of securities held by each
such holder (or, 

 

12

 

if any holder does
not request to include its ratable share, such excess shall be allocated
ratably among those holders requesting to include more than their allocable
share).

 

(c)   Any
holder of Registrable Securities shall be entitled to withdraw such holder’s
request to participate in any Incidental Registration that is an underwritten
offering at any time prior to the execution and delivery of the related
underwriting agreement.

 

5C   Holdback Agreements.

 

(a)   Each
Securityholder agrees not to effect any Public Sale of any Securityholder Shares or of any other
equity securities of the Company, or any securities convertible into or
exchangeable or exercisable for such stock or securities, during the period
beginning seven (7) days prior to, and ending 180 days after (or for such
shorter period as to which the managing underwriter(s) may agree), the date of
the underwriting agreement of each underwritten offering made pursuant to a
Registration Statement other than Registrable Securities sold pursuant to such
underwritten offering.

 

(b)   The Company
agrees (i) not to effect any public sale or distribution of its equity securities
(or any securities convertible into or exchangeable or exercisable for such
securities) during the seven (7) days prior to and during the 180-day period
beginning on the effective date of any underwritten Demand Registration (or for
such shorter period as to which the managing underwriter or underwriters may
agree), except as part of such Demand Registration or in connection with any
employee benefit or similar plan, any dividend reinvestment plan, or a business
acquisition or combination and (ii) to use all reasonable efforts to cause each
holder of at least 5% (on a fully diluted basis) of its equity securities (or
any securities convertible into or exchangeable or exercisable for such
securities) which are or may be purchased from the Company at any time after
the date of this Agreement (other than in a registered offering) to agree not
to effect any sale or distribution of any such securities during such period
(except as part of such underwritten offering, if otherwise permitted).

 

5D   Registration
Procedures.  In connection with the
registration of any Registrable Securities, the Company shall effect such
registrations to permit the sale of such Registrable Securities in accordance
with the intended method or methods of disposition thereof, and pursuant
thereto the Company shall as expeditiously as possible:

 

(a)   prepare and file
with the SEC a Registration Statement or Registration Statements on a form
available for the sale of the Registrable Securities by the holders thereof in
accordance with the intended method of distribution thereof, and use its best
efforts to cause each such Registration Statement to become effective;

 

(b)   prepare and file
with the SEC such amendments and post-effective amendments to each Registration
Statement as may be necessary to keep such Registration Statement continuously
effective for a period ending on the earlier of (i) 90 days from the effective
date and (ii) such time as all of such securities have been disposed of in
accordance with the intended method of disposition thereof; cause the related
prospectus to be supplemented by any required prospectus supplement and, as so
supplemented, to be filed pursuant to Rule 424 (or any similar provisions then
in force) under the Securities Act; and comply with the provisions 

 

13

 

of the Securities
Act, the Exchange Act and the rules and regulations of the SEC promulgated
thereunder applicable to it with respect to the disposition of all securities
covered by such Registration Statement as so amended or in such prospectus as
so supplemented;

 

(c)   notify each
holder of Registrable Securities promptly (but in any event within two (2)
Business Days), and confirm such notice in writing, (i) when a prospectus or
any prospectus supplement or post-effective amendment has been filed, and, with
respect to a Registration Statement or any post-effective amendment, when the
same has become effective, (ii) of the issuance by the SEC of any stop order
(or threat of such issuance of a stop order) suspending the effectiveness of a
Registration Statement or of any order preventing or suspending the use of any
preliminary prospectus, (iii) if, at any time when a prospectus is required by
the Securities Act to be delivered in connection with sales of Registrable
Securities, the Company becomes aware that the representations and warranties
of the Company contained in any agreement (including any underwriting
agreement) contemplated by Section 5D(j) cease to be true and
correct in all material respects, (iv) of the receipt by the Company of any
notification with respect to the suspension of the qualification or exemption
from qualification of a Registration Statement or any of the Registrable
Securities for offer or sale in any jurisdiction, and (v) if the Company
becomes aware of the happening of any event that makes any statement made in
such Registration Statement or related prospectus or any document incorporated
or deemed to be incorporated therein by reference untrue in any material
respect or that requires the making of any changes in such Registration
Statement, prospectus or documents so that, in the case of such Registration
Statement, it will not contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary to make
the statements therein not misleading, and that in the case of the prospectus,
it will not contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading;

 

(d)   use its best
efforts to prevent the issuance of any order suspending the effectiveness of a
Registration Statement or of any order preventing or suspending the use of a
prospectus or suspending the qualification (or exemption from qualification) of
any of the Registrable Securities for sale in any jurisdiction, and, if any
such order is issued, to obtain the withdrawal of any such order at the earliest
possible moment;

 

(e)   furnish, upon
request, to each holder of Registrable Securities to be included in such
Registration and the underwriter or underwriters, if any, without charge, one
original copy and such number of conformed copies of the registration statement
and any post-effective amendment thereto, and such number of copies of the
prospectus (including each preliminary prospectus and each prospectus filed
under Rule 424 under the Securities Act), any amendments or supplements thereto
and any documents incorporated by reference therein, as such holder or
underwriter may reasonably request in order to facilitate the disposition of
the Registrable Securities being sold by such holder (it being understood that
the Company consents to the use of the prospectus and any amendment or
supplement thereto by each holder of Registrable Securities covered by such
registration statement and the underwriter or underwriters, if any, in
connection with the Public Offering and sale of the Registrable Securities covered
by the prospectus or any amendment or supplement thereto);

 

14

 

(f)    if requested by
the managing underwriter or underwriters or any holder of Registrable
Securities to be included in such Registration in connection with any sale
pursuant to a registration statement, promptly incorporate in a prospectus
supplement or post-effective amendment such information relating to such
underwriting as the managing underwriter or underwriters or such holder reasonably
requests to be included therein; and make all required filings of such
prospectus supplement or post-effective amendment as soon as practicable after
being notified of the matters incorporated in such prospectus supplement or
post-effective amendment;

 

(g)   in connection
with any sale pursuant to a Registration, cooperate with the holders of
Registrable Securities to be included in such Registration and the managing
underwriter or underwriters, if any, to facil­itate the timely preparation and
delivery of certificates (not bearing any restrictive legends including,
without limitation, those set forth in Section 7) representing
securities to be sold under such Registration, and enable such securities to be
in such denominations and registered in such names as the managing underwriter
or underwriters, if any, or such holders may request;

 

(h)   prior to any
Public Offering of Registrable Securities, to use its best efforts to (1)
register or qualify, and cooperate with each holder of Registrable Securities,
the underwriters (if any), the sales agents, and their respective counsel in
connection with the registration or qualification (or exemption from such
registration or qualification) of such Registrable Securities for offer and
sale under the securities or “blue sky” laws of such jurisdictions within the
United States as any holder of Registrable Securities or the managing
underwriters reasonably request in writing and (2) to cause such
Registrable Securities to be registered with or approved by such other governmental
agencies or authorities as may be necessary by virtue of the business and
operations of the Company and do any and all other acts and things that may be
reasonably necessary or advisable to enable any holder of Registrable
Securities to consummate the disposition of the Registrable Securities owned by
such holder; provided, however, that the Company shall not be
required to (i) qualify generally to do business in any jurisdiction where it
would not otherwise be required to qualify but for this Section 5D(h),
(ii) subject itself to taxation in any jurisdiction or (iii) consent to general
service of process in any such jurisdiction where it is not then so subject;

 

(i)    upon the
occurrence of any event contemplated by Section 5D(c)(v), as
promptly as practicable prepare a supplement or post-effective amendment to the
Registration Statement or a supplement to the related prospectus or any
document incorporated or deemed to be incorporated therein by reference, or
file any other required document so that, as thereafter delivered to the
purchasers of the Registrable Securities being sold thereunder, such prospectus
will 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, in light of the circumstances under which they were made, not
misleading;

 

(j)    enter into an
underwriting agreement in such form, scope and substance as is customary in
underwritten offerings and take all such other actions as are reasonably
requested by the managing or sole underwriter in order to expedite or
facilitate the registration or the disposition of such Registrable Securities,
and in such connection, (i) make such representations and warranties to the
underwriters with respect to the business of the Company and its 

 

15

 

Subsidiaries, and
the Registration Statement, prospectus and documents, if any, incorporated or
deemed to be incorporated by reference therein, in each case, in form,
substance and scope as are customarily made by issuers to underwriters in
underwritten offerings, and confirm the same if and when requested; (ii) obtain
opinions of counsel to the Company and updates thereof (which counsel and
opinions (in form, scope and substance) shall be reasonably satisfactory to the
managing underwriters), addressed to the underwriters covering the matters
customarily covered in opinions requested in underwritten offerings and such
other matters as may be reasonably requested by underwriters; (iii) obtain “cold
comfort” letters and updates thereof from the independent certified public
accountants of the Company (and, if necessary, any other independent certified
public accountants of any Subsidiary of the Company or of any business acquired
by the Company for which financial statements and financial data are, or are
required to be, included in the Registration Statement), addressed to each of
the underwriters, such letters to be in customary form and covering matters of
the type customarily covered in “cold comfort” letters in connection with
underwritten offerings; and (iv) if an underwriting agreement is entered into,
the same shall contain indemnification provisions and procedures no less
favorable to the holders of Registrable Securities than those set forth in Section 5F
(or such other provisions and procedures acceptable to holders of a majority of
the Registrable Securities covered by such Registration Statement and the
managing underwriters or agents) with respect to all parties to be indemnified
pursuant to said Section (and each of the foregoing shall be done at each
closing under such underwriting agreement, or as and to the extent required
thereunder);

 

(k)   comply with all
applicable rules and regulations of the SEC and make generally available to its
stockholders an earnings statement satisfying the provisions of
Section 11(a) of the Securities Act and Rule 158 thereunder (or any
similar rule promulgated under the Securities Act) no later than the time
prescribed under Regulation S-X (i) commencing at the end of any fiscal quarter
in which Registrable Securities are sold to underwriters in a firm commitment
or best efforts underwritten offering and (ii) if not sold to underwriters in
such an offering, commencing on the first day of the first fiscal quarter of
the Company after the effectiveness of a Registration Statement, which
statements shall cover said 12-month periods;

 

(l)    cause the
executive officers of the Company to cooperate fully in any offering of
Registrable Securities hereunder, including participation in meetings with
potential investors and preparation of all materials for such investors; and

 

(m)  (i)  use its best efforts to cause all such
Registrable Securities covered by such registration statement to be listed on
the principal securities exchange on which Common Stock is then listed (if
any), if the listing of such Registrable Securities is then permitted under the
rules of such exchange, or (ii) if no Common Stock is then so listed, use its
best efforts to, either (as the Company may elect) (x) cause all such
Registrable Securities to be listed on a national securities exchange or (y)
secure designation of all such Registrable Securities as a NASDAQ “national
market system security” within the meaning of Rule 11Aa2-1 or, failing that, to
secure NASDAQ authorization for such shares and, without limiting the
generality of the foregoing, to arrange for at least two market makers to
register as such with respect to such shares with the National Association of Securities
Dealers, Inc. (“NASD”).

 

The Company may require each holder of Registrable Securities as to
which any registration is being effected to furnish to the Company such
information regarding such holder 

 

16

 

and the distribution of such Registrable Securities as
the Company may, from time to time, reasonably request in writing; provided,
that such information shall be used only in connection with such
registration.  The Company may exclude
from such registration the Registrable Securities of any holder who
unreasonably fails to furnish such information promptly after receiving such
request.  The Company shall permit any
holder of Registrable Securities that, in such holder’s judgment, may be deemed
to be an underwriter or controlling person of the Company, to participate in
the preparation of the Registration Statement and to require the insertion
therein of material, furnished to the Company in writing, which in the
reasonable judgment of such holder and its counsel should be included.  Each holder agrees that, upon receipt of any
notice from the Company of the happening of any event of the kind described in Section 5D(c)(ii),
5D(c)(iv) or 5D(c)(v), such holder shall forthwith discontinue
disposition of such Registrable Securities covered by such Registration
Statement or prospectus until such holder’s receipt of the copies of the
supplemented or amended prospectus contemplated by this Section 5D,
or until it is advised in writing by the Company that the use of the applicable
prospectus may be resumed, and has received copies of any amendments or
supplements thereto.

 

5E    Registration Expenses.

 

(a)   All
fees and expenses incident to the performance of or compliance with this
Agreement by the Company shall be borne by the Company, whether or not any
Registration Statement is filed or becomes effective, including all
registration and filing fees, including fees with respect to filings required
to be made with the NASD in connection with an underwritten offering and fees
and expenses of compliance with state securities or “blue sky” laws, printing
expenses, messenger, telephone and delivery expenses, fees and disbursements of
custodians, fees and expenses of counsel for the Company, fees and expenses of
all independent certified public accountants referred to in Section 5D(j),
underwriters’ fees and expenses (excluding discounts, commissions, or fees of
underwriters, selling brokers, dealer managers or similar securities industry
professionals relating to the distribution of the Registrable Securities or any
other commissions or legal fees incurred by holders of Registrable Securities
(other than BSMB)), Securities Act liability insurance, if the Company so
desires such insurance,  internal
expenses of the Company, the expense of any annual audit or interim review, the
fees and expenses incurred in connection with the listing of the securities to
be registered on any securities exchange, and the fees and expenses of any
Person, including special experts, retained by the Company.

 

(b)   In
connection with any Demand Registration or Incidental Registration hereunder,
the Company shall reimburse the holders of the Registrable Securities being
registered in such registration for the fees and disbursements of not more than
one counsel (together with appropriate local counsel) chosen by the BSMB
Investors holding at least a majority of the Registrable Securities included in
such registration.

 

5F    Indemnification;
Contribution.

 

(a)   The Company
shall, and shall cause each of its Subsidiaries to, jointly and severally,
without limitation as to time, indemnify, defend and hold harmless, to the full
extent permitted by law, each holder of Registrable Securities, the partners,
members, officers, directors, agents and employees of each of them, each Person
who controls each such holder 

 

17

 

(within the
meaning of Section 15 of the Securities Act or Section 20 of the
Exchange Act), the partners, members, officers, directors, agents and employees
of each such controlling person and any financial or investment adviser (each,
a “Covered Person”), to the
fullest extent lawful, from and against any and all losses, claims, damages,
liabilities, actions or proceedings (whether commenced or threatened), costs
(including, without limitation, costs of preparation and attorneys’ fees) and
expenses (including expenses of investigation) (collectively, “Losses”), as incurred, arising out of or
based upon (i) any untrue or alleged untrue statement of a material fact
contained in any Registration Statement, prospectus or form of prospectus or in
any amendment or supplements thereto or in any preliminary prospectus, or
arising out of or based upon any omission or alleged omission of a material
fact required to be stated therein or necessary to make the statements therein
not misleading, except to the extent that the same arise out of or are based
upon information furnished in writing to the Company by such Covered Person or
the related holder of Registrable Securities expressly for use therein or (ii)
any violation by the Company of any federal, state or common law rule or
regulation applicable to the Company and relating to action required of or
inaction by the Company in connection with any such registration; provided,
that the Company shall not be liable to any Person who participates as an
underwriter in the offering or sale of Registrable Securities or any other
Person, if any, who controls such underwriters within the meaning of the
Securities Act to the extent that any such Losses arise out of or are based
upon an untrue statement or alleged untrue statement or omission or alleged
omission made in any preliminary prospectus if (A) such Person failed to send
or deliver a copy of the prospectus with or prior to the delivery of written
confirmation of the sale by such Person to the Person asserting the claim from
which such Losses arise, (B) the prospectus would have corrected such untrue
statement or alleged untrue statement or such omission or alleged omission and
(C) the Company has complied with its obligations under Section 5D(c).  Each indemnity and reimbursement of costs and
expenses shall remain in full force and effect regardless of any investigation
made by or on behalf of such Covered Person. 
If the Public Offering pursuant to any Registration Statement provided
for under this Section 5 is made through underwriters, (x) no
action or failure to act on the part of such underwriters (whether or not such
underwriter is an Affiliate of any holder of Registrable Securities) shall
affect the obligations of the Company to indemnify any holder of Registrable
Securities or any other Person pursuant to the preceding sentence and (y) the
Company agrees to enter into an underwriting agreement in customary form with
such under­writers and the Company agrees to indemnify such underwriters, their
officers, directors, employees and agents, if any, and each Person, if any, who
controls such underwriters within the meaning of Section 15 of the
Securities Act to the same extent as provided in this Section 5F
with respect to the indemnification of the holders of Registrable Securities; provided,
that the Company shall not be required to indemnify any such underwriter, or
any officer, director or employee of such underwriter or any Person who
controls such underwriter within the meaning of Section 15 of the
Securities Act, to the extent that the loss, claim, damage, liability (or
proceedings in respect thereof) or expense for which indemnification is claimed
results from such underwriter’s failure to send or give a copy of an amended or
supplemented final prospectus to the Person asserting an untrue statement or
alleged untrue statement or omission or alleged omission at or prior to the
written confirmation of the sale of Registrable Securities to such Person if
such statement or omission was corrected in such amended or supplemented final
prospectus prior to such written confirmation and the underwriter was provided
with such amended or supplemented final prospectus.

 

18

 

(b)   In
connection with any Registration Statement in which a holder of Registrable
Securities is participating, such holder, or an authorized officer of such
holder, shall furnish to the Company in writing such information regarding such
holder as the Company reasonably requests for use in connection with any
Registration Statement or prospectus and agrees, severally and not jointly, to
indemnify, defend and hold harmless to the full extent permitted by law, the
Company, its directors, officers, agents and employees, each Person who
controls the Company (within the meaning of Section 15 of the Securities
Act and Section 20 of the Exchange Act), and the partners, members,
directors, officers, agents or employees of such controlling persons, from and
against all Losses arising out of or based upon any untrue or alleged untrue
statement of a material fact contained in any Registration Statement,
prospectus, or form of prospectus, or arising out of or based upon any omission
or alleged omission of a material fact required to be stated therein or
necessary to make the statements therein not misleading, to the extent, but
only to the extent, that such untrue or alleged untrue statement is contained
in, or such omission or alleged omission is required to be contained in, any
information regarding such holder so furnished in writing by such holder to the
Company expressly for use in such Registration Statement or prospectus and that
such statement or omission was relied upon by the Company in preparation of
such Registration Statement, prospectus or form of prospectus; provided,
that such holder of Registrable Securities shall not be liable in any such case
to the extent that the holder has furnished in writing to the Company within a
reasonable period of time prior to the filing of any such Registration
Statement or prospectus or amendment or supplement thereto information
expressly for use in such Registration Statement or prospectus or any amendment
or supplement thereto which corrected or made not misleading, information
previously furnished to the Company, and the Company failed to include such
information therein.  In no event shall
the liability of any holder of Registrable Securities hereunder be greater in
amount than the dollar amount of the proceeds (net of payment of all taxes and
expenses incurred in connection therewith) received by such holder upon the
sale of the Registrable Securities giving rise to such indemnification
obligation.  Such indemnity shall remain in
full force and effect regardless of any investigation made by or on behalf of
such indemnified party.

 

(c)   If
any Person shall be entitled to indemnity hereunder (an “Indemnified Party”), such Indemnified
Party shall give prompt notice to the party or parties from which such
indemnity is sought (the “Indemnifying
Parties”) of the commencement of any action, suit, proceeding or
investigation or written threat thereof (a “Proceeding”)
with respect to which such Indemnified Party seeks indemnification or contribution
pursuant hereto; provided, that the failure to so notify the
Indemnifying Parties shall not relieve the Indemnifying Parties from any
obligation or liability except to the extent that the Indemnifying Parties have
been prejudiced by such failure.  The
Indemnifying Parties shall have the right, exercisable by giving written notice
to an Indemnified Party promptly after the receipt of written notice from such
Indemnified Party of such Proceeding, to assume, at the Indemnifying Parties’
expense, the defense of any such Proceeding, with counsel reasonably
satisfactory to such Indemnified Party; provided, that an Indemnified
Party (if more than one such Indemnified Party is named in any Proceeding)
shall have the right to employ separate counsel in any such Proceeding and to
participate in the defense thereof, but the fees and expenses of such counsel
shall be at the expense of such Indemnified Party or parties unless:  (i) the Indemnifying Parties agree to pay
such fees and expenses; (ii) the Indemnifying Parties fail promptly to assume
the defense of such Proceeding or fail to employ counsel reasonably
satisfactory to such Indemnified Party or parties; or (iii) the 

 

19

 

named parties to any such Proceeding (including any impleaded parties)
include both such Indemnified Party or parties and the Indemnifying Parties or
an Affiliate of the Indemnifying Parties or such Indemnified Parties, and there
may be one or more defenses available to such Indemnified Party that are
different from or additional to those available to the Indemnifying Parties, in
which case, if such Indemnified Party notifies the Indemnifying Parties in
writing that it elects to employ separate counsel at the expense of the
Indemnifying Parties; the Indemnifying Parties shall not have the right to
assume the defense thereof and such counsel shall be at the expense of the
Indemnifying Parties, it being understood, however, that, unless there exists a
conflict among Indemnified Parties, the Indemnifying Parties shall not, in
connection with any one such Proceeding or separate but substantially similar
or related Proceedings in the same jurisdiction, arising out of the same
general allegations or circumstances, be liable for the fees and expenses of
more than one separate firm of attorneys (together with appropriate local
counsel) at any time for such Indemnified Party.  Whether or not such defense is assumed by the
Indemnifying Parties, such Indemnifying Parties or Indemnified Party shall not
be subject to any liability for any settlement made without its or their
consent (but such consent shall not be unreasonably withheld).  The Indemnifying Parties shall not consent to
entry of any judgment or enter into any settlement which (x) provides for other
than monetary damages without the consent of the Indemnified Party (which
consent shall not be unreasonably withheld or delayed) or (y) does not include
as an unconditional term thereof the giving by the claimant or plaintiff to
such Indemnified Party of a release, in form and substance satisfactory to the
Indemnified Party, from all liability in respect of such Proceeding for which
such Indemnified Party would be entitled to indemnification hereunder.

 

(d)   If
the indemnification provided for in this Section 5F is unavailable
to an Indemnified Party or is insufficient to hold such Indemnified Party
harmless for any Losses in respect of which this Section 5F would
otherwise apply by its terms, then each applicable Indemnifying Party, in lieu
of indemnifying such Indemnified Party, shall have an obligation to contribute
to the amount paid or payable by such Indemnified Party as a result of such
Losses, in such proportion as is appropriate to reflect the relative fault of
the Indemnifying Party, on the one hand, and such Indemnified Party, on the
other hand, in connection with the actions, statements or omissions that
resulted in such Losses as well as any other relevant equitable
considerations.  The relative fault of
such Indemnifying Party, on the one hand, and Indemnified Party, on the other
hand, shall be determined by reference to, among other things, whether any
action in question, including any untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact, has
been taken by, or relates to information supplied by, such Indemnifying Party
or Indemnified Party, and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent any such action, statement or
omission.  The amount paid or payable by
a party as a result of any Losses shall be deemed to include any legal or other
fees or expenses incurred by such party in connection with any Proceeding, to
the extent such party would have been indemnified for such expenses if the
indemnification provided for in Section 5F(a) or 5F(b) was
available to such party.  The parties
hereto agree that it would not be just and equitable if contribution pursuant
to this Section 5F(d) were determined by pro rata allocation or by
any other method of allocation that does not take account of the equitable
considerations referred to in this Section 5F(d).  Notwithstanding the provisions of this Section 5F(d),
an Indemnifying Party that is a holder of Registrable Securities shall not be
required to contribute any amount in excess of the amount by which the net
proceeds received by such Indemnifying 

 

20

 

Party exceeds the amount of any damages that such Indemnifying Party
has otherwise been required to pay by reasons 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.

 

(e)   Each
Securityholder and the Company agree that such Person shall not permit any
amendment to the Certificate of Incorporation or the by-laws of the Company
that would reduce the scope of the indemnification or limitation of liability
provisions contained therein.

 

5G   Rules
144 and 144A.  At all times after the
Company effects its first Public Offering, the Company shall file the reports
required to be filed by it under the Securities Act and the Exchange Act and
the rules and regulations promulgated thereunder (or, if the Company is not
required to file such reports, it shall, upon the request of any holder of
Registrable Securities, make publicly available other information so long as
such information is necessary to permit sales under Rule 144A), and shall take
such further action as any holder of Registrable Securities may reasonably
request, all to the extent required from time to time to enable such holder to
sell (subject to any restrictions on Transfers hereunder) Registrable
Securities without registration under the Securities Act within the limitation
of the exemptions provided by Rule 144 and Rule 144A.  Upon the request of any holder of Registrable
Securities, the Company shall deliver to such holder a written statement as to
whether it has complied with such requirements.

 

5H   Underwritten
Registrations.  No holder of
Registrable Securities may participate in any underwritten registration
effected pursuant hereto unless such holder (a) agrees to sell such holder’s
Registrable Securities on the basis provided in any underwriting arrangements
approved by the Persons entitled hereunder to approve such arrangements and
(b) completes and executes all questionnaires, powers of attorney,
indemnities, underwriting agreements and other documents required under the
terms of such underwriting arrangements.

 

5I     No
Inconsistent Agreements.  The Company
has not and shall not enter into any agreement with respect to the Company’s
securities that is inconsistent with the rights granted to the holders of
Registrable Securities in this Section 5 or otherwise conflicts
with the provisions hereof.  The Company
represents and warrants that it is not a party to, or otherwise subject to, any
other agreement granting registration rights to any other Person with respect
to any Common Stock or Common Stock Equivalents. Except as provided in this
Agreement, the Company shall not grant Other Registration Rights to any Persons
without the prior written consent of the Board.

 

6.     Preemptive Rights.

 

(a)   If
at any time prior to the consummation of an IPO the Company wishes to issue any
equity securities or any Common Stock Equivalents to any Person (the “Preemptive Securities”), the Company shall
promptly deliver a notice of intention to sell (the “Company’s Notice of Intention to Sell”) to each
Securityholder setting forth a description and the number of the Preemptive
Securities proposed to be issued and the proposed purchase price and terms of
sale.  Upon receipt of the Company’s
Notice of 

 

21

 

Intention to Sell, each Securityholder shall have the right to elect to
purchase, at the price and on the terms stated in the Company’s Notice of
Intention to Sell, a number of the Preemptive Securities equal to the product
of (i) such Securityholder’s proportionate ownership of the then outstanding
number of shares of Common Stock (excluding all unexercised options at such
time) held by all Persons multiplied by (ii) the number of Preemptive
Securities proposed to be issued (as described in the applicable Company’s
Notice of Intention to Sell). 
Notwithstanding anything contained herein to the contrary, if the
Company is issuing Preemptive Securities in connection with the issuance of any
debt or other equity securities of the Company or any of its Subsidiaries, then
any Securityholder who elects to purchase such Preemptive Securities pursuant
to this Section 6 must also purchase a corresponding proportion of such
other debt or equity securities, all at the proposed purchase price and on
terms of sale as specified in the applicable Company’s Notice of Intention to
Sell.  Such election shall be made by the
electing Securityholder by written notice to the Company within ten (10)
business days after receipt by such Securityholder of the Company’s Notice of
Intention to Sell (the “Acceptance Period”).

 

(b)   To
the extent an effective election to purchase has not been received from a
Securityholder pursuant to subsection (a) above in respect of the Preemptive
Securities proposed to be issued pursuant to the applicable Company’s Notice of
Intention to Sell, the Company may, at its election, during a period of one
hundred and twenty (120) days following the expiration of the applicable
Acceptance Period, issue and sell the remaining Preemptive Securities to be
issued and sold to such Person at a price and upon terms not more favorable to
such Person than those stated in the applicable Company’s Notice of Intention
to Sell; provided, that the failure by any Securityholder to exercise
its option to purchase with respect to one issuance and sale of Preemptive
Securities shall not affect its option to purchase Preemptive Securities in any
subsequent offering, sale and purchase. 
In the event the Company has not sold any Preemptive Securities covered
by a Company’s Notice of Intention to Sell within such one hundred and twenty
(120) day period, the Company shall not thereafter issue or sell such
Preemptive Securities, without first offering such Preemptive Securities to
each Securityholder in the manner provided in this Section 6.

 

(c)   If
a Securityholder gives the Company notice pursuant to the provisions of this Section
6 that such Securityholder desires to purchase any Preemptive Securities,
payment therefor shall be by check or wire transfer of immediately available
funds, against delivery of the securities (which securities shall be issued
free and clear of any liens or encumbrances) at the executive offices of the
Company at the closing date fixed by the Company for the sale of such
applicable Preemptive Securities; provided, that such date is not
earlier than the actual closing date with respect to all other purchasers of
securities referred to in the Company’s Notice of Invention to Sell.  In the event that any proposed sale is for a
consideration other than cash, such Securityholder may pay cash in lieu of all
(but not part) of such other consideration, in the amount determined reasonably
and in good faith by the Board to represent the fair value of such
consideration other than cash.

 

(d)   The
preemptive rights contained in this Section 6 shall not apply to the
issuance of Common Stock Equivalents or other equity securities (i) as a stock
dividend or other distribution or upon any subdivision, split or combination of
the outstanding capital stock; (ii) upon conversion, exchange or redemption of
any outstanding convertible or exchangeable securities; (iii) upon exercise of
any outstanding options or warrants; (iv) to any director of the Company or any
of its Subsidiaries as compensation or as an incentive for services; and (v) as

 

22

 

consideration (whether partial or otherwise) for the purchase by the
Company or any of its Subsidiaries of assets constituting a business unit or of
the stock or other equity securities of any Person.

 

(e)   The
provisions of this Section 6 shall terminate upon the consummation of an
IPO.

 

(f)    Nothing
in this Section 6 shall be deemed to prevent BSMB or any Affiliate
of BSMB (the “Purchasing Holder”)
from purchasing for cash any Preemptive Securities without first complying with
the provisions of Section 6(a); provided that in connection with such purchase, (i) the
Board has determined in good faith (1) that the Company needs an immediate
cash investment, (2) that no alternative financing on terms no less
favorable to the Company in the aggregate than such purchase is available which
is of a type that could be obtained without having to comply with Section 6(a)
and (3) that the delay caused by compliance with the provisions of Section 6(a)
in connection with such investment would be reasonably likely to cause severe
and immediate harm to the Company, (ii) the Company gives prompt notice to
the other Securityholders, which notice shall describe in reasonable detail the
Preemptive Securities being purchased by the Purchasing Holder and the purchase
price thereof and (iii) the Purchasing Holder and the Company (or
applicable Subsidiary) take all steps necessary to enable the other Securityholders
to effectively exercise their respective rights under Section 6(a)
with respect to their purchase of a pro rata share of the Preemptive Securities
issued to the Purchasing Holder after such purchase by the Purchasing Holder.

 

7.     Legend.

 

(a)   Each
certificate evidencing Securityholder
Shares and each certificate issued in exchange for or upon the Transfer of any Securityholder Shares (if such shares
remain Securityholder Shares
after such Transfer) shall be stamped or otherwise imprinted with a legend in
substantially the following form:

 

“THE SECURITIES
REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED ON MAY 31, 2007, HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”),
AND MAY NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT UNDER THE ACT OR AN EXEMPTION FROM REGISTRATION THEREUNDER.  THE SECURITIES REPRESENTED BY THIS
CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS AND CONDITIONS ON TRANSFER, AS
SET FORTH IN A SECURITYHOLDERS
AGREEMENT, DATED AS OF MAY 31, 2007, BY AND AMONG THE ISSUER OF SUCH SECURITIES
(THE “COMPANY”) AND CERTAIN OF THE COMPANY’S STOCKHOLDERS, AS MAY BE AMENDED
AND MODIFIED FROM TIME TO TIME. 
A COPY OF SUCH SECURITYHOLDERS
AGREEMENT SHALL BE FURNISHED WITHOUT CHARGE BY THE COMPANY TO THE HOLDER HEREOF
UPON WRITTEN REQUEST.”

 

23

 

The Company shall imprint such legend on certificates evidencing Securityholder Shares outstanding as
of the date hereof.  The legend set forth
above shall be removed from the certificates evidencing any shares which cease
to be Securityholder Shares in
accordance with the definition of “Securityholder Shares” in Section 12.

 

(b)   Unless
waived by the Company, no Securityholder may Transfer any Securityholder Shares
(except pursuant to an effective registration statement under the Securities
Act) without first delivering to the Company an opinion of counsel reasonably
acceptable in form and substance to the Company (which counsel will be reasonably
acceptable to the Company) that registration under the Securities Act is not
required in connection with such Transfer. 
If such opinion of counsel reasonably acceptable in form and substance
to the Company further states that no subsequent Transfer of such
Securityholder Shares will require registration under the Securities Act, the
Company will promptly upon such Transfer deliver new certificates for such
securities which do not bear the Securities Act legend set forth in Section
7(a).

 

8.     Amendment and Waiver.  Except as otherwise provided herein, no
modification, amendment or waiver of any provision of this Agreement shall be
effective against the Company or the Securityholders unless such modification,
amendment or waiver is approved in writing by the Company and the BSMB Majority
Holders.  Notwithstanding the foregoing,
if any amendment, modification or waiver of any provision of this Agreement
would materially adversely affect the rights of a Securityholder in a manner
disproportionate to the other Securityholders holding the same class of
Securityholder Shares, or impose any additional obligation of any type on any
Securityholder (except as may be required by Law or Exchange Act requirements)
then such amendment, modification or waiver shall also require the prior
written consent of such Securityholder. 
The failure of any party to enforce any of the provisions of this
Agreement shall in no way be construed as a waiver of such provisions and shall
not affect the right of such party thereafter to enforce each and every
provision of this Agreement in accordance with its terms.

 

9.     Limited Approval Rights;
Transactions with Affiliates.

 

(a)   From
the Closing Date until a Qualified Public Offering, the Company shall not, and
shall not permit any Subsidiary to, take any of the following actions without
obtaining the prior consent of the BSMB Majority Holders:

 

(i)            declare
or pay any dividends or other distributions on the Common Stock;

 

(ii)           enter into or refinance, or permit any of its Subsidiaries to enter into
or refinance, any indebtedness for borrowed money (other than indebtedness
incurred pursuant to the Credit Agreement and the Senior Notes);

 

(iii)          merge
or consolidate with or into any Person;

 

(iv)          sell,
lease or otherwise dispose of, or permit any of its Subsidiaries to sell, lease
or otherwise dispose of, all or substantially all of the assets of the Company 

 

24

 

and its
Subsidiaries (other than sales of inventory in the ordinary course of business)
in any transaction or series of related transactions;

 

(v)           liquidate,
dissolve or effect a recapitalization or reorganization in any form of
transaction (including, without limitation, any reorganization into a limited
liability company, a partnership or any other non-corporate entity which is
treated as a partnership for federal income tax purposes);

 

(vi)          enter
into, or permit any of its Subsidiaries to enter into, the ownership, active
management or operation of any business other than the business conducted by
the Company and its Subsidiaries as of the date hereof;

 

(vii)         amend
any of the Transaction Documents, in each case, in any manner which would have
an adverse effect on any BSMB Investor;

 

(viii)        file,
permit any of the Company’s Subsidiaries to file, any registration statement
with the SEC with respect to the registration of an offering or sale of any
equity securities;

 

(ix)           make any
material change to its accounting practices, other than (A) as required by
applicable law or regulation, (B) as required by GAAP or FASB or (C) as
approved by the Board or any committee thereof;

 

(x)            change
the Company’s auditors;

 

(xi)           issue or
redeem any Common Stock Equivalents except for the issuance of Common Stock
Equivalents upon (i) the conversion, exchange or redemption of any outstanding
convertible or exchangeable securities or (ii) the exercise of any
outstanding options or warrants;

 

(xii)          agree
to take any of the foregoing actions.

 

(b)   Restrictions
on Transactions with Affiliates. 
Except for the Professional Services Agreement and such other agreements
executed in connection with the consummation of the transactions contemplated
by the Merger Agreement, neither the Company nor its Subsidiaries will enter
into any transaction (other than the issuance of Preemptive Securities pursuant
to Section 6 of this Agreement) with BSMB or any of their Affiliates (i)
on a basis that is less favorable, in the aggregate and in all material
respects to the Company than would be the case in an arms-length transaction
with an unrelated third party or (ii) for services that are not reasonably
required or desirable for the Company or such Subsidiaries, as the case may be
(as determined in good faith by the Board).

 

10.   Right to
Repurchase Other Holders Shares.

 

(a)   In
the event that any Other Holder ceases to be employed by the Company or any of
its Subsidiaries as a result of (i) a termination by the Company or its
Subsidiary, as applicable, for Cause or (ii) a voluntary resignation (other
than for Good Reason) by such Other Holder (the date such Other Holder ceases
to be so employed shall be referred to herein as the

 

25

“Termination Date”),
the Company shall have the right (but not the obligation) (the “Repurchase Option”) to purchase any or all
of the Securityholder Shares then held by such Other Holder, such Other Holder’s
estate and/or such Other Holder’s Permitted Transferees or Affiliates (the “Repurchase Shares”) pursuant to the terms
and conditions set forth in this Section 10.

 

(b)           The
Repurchase Shares purchased pursuant to the Repurchase Option will be purchased
at a price equal to the Fair Market Value of such Repurchase Shares as of the
date that the Company delivers a Repurchase Notice to the Other Holder (the “Valuation Date”), less the amount of any
cash distributed by the Company with respect to such Repurchase Shares between
the Valuation Date and the closing of such repurchase  (the “Repurchase Price”).

 

(c)           The
Repurchase Option is exercisable by the Company delivering written notice (the “Repurchase Notice”) to the holders of the
Repurchase Shares during the 240-day period beginning on the Termination Date
(the “Company Repurchase Period”).
The Repurchase Notice will set forth the percentage of the aggregate value of
Repurchase Shares to be purchased by the Company.

 

(d)           The
closing of any transaction contemplated by this Section 10 will take
place on the date designated by the Company, which date will not be more than
forty-five (45) days after the Valuation Date; provided, that subsequent
to the Valuation Date, the Company may rescind its exercise of the Repurchase
Option by delivering written notice to such holder(s) of Repurchase Shares
within ten (10) days after the Valuation Date. The Company will pay for any
Repurchase  Shares to be purchased by the
Company pursuant to any Repurchase Option by delivery of a check(s) payable or
by wire transfer of immediately available funds to the holder(s) of such
Repurchase Shares in an aggregate amount equal to the applicable repurchase
price for such Repurchase Shares.

 

(e)           Notwithstanding
anything to the contrary contained in this Agreement, all repurchases of Repurchase
Shares by the Company will be subject to applicable restrictions contained in
applicable Law (including the Delaware General Corporation Law) and in the
Company’s and its Subsidiaries’ debt and equity financing agreements that are
in effect as of the Valuation Date. If any such restrictions prohibit the
repurchase of the Repurchase Shares which the Company is otherwise entitled to
make pursuant to this Section 10 or if such repurchase would cause a
default under any of the Company’s and/or its Subsidiaries’ debt and/or equity
financing agreements, and, in either case, a Repurchase Notice has been timely
delivered pursuant to Section 10(c), the Company may, subject to the
provisions of this Section 10(e), make such repurchases as soon as
(i) it is permitted to do so under such restrictions and (ii) such
repurchase would not cause such a default.

 

(f)            The
Company will receive customary representations and warranties from each seller
regarding the sale of Repurchase Shares, including, but not limited to, the
representation that such seller has good and marketable title to the Repurchase
Shares to be transferred free and clear of any liens, claims, encumbrances or
other restrictions (other than such restrictions arising under this Agreement).

 

(g)           The
provisions of this Section 10 shall terminate upon the consummation of
an IPO.

 

26

 

11.           Financial
Statements. Prior to the consummation of an IPO, the Company shall deliver
to each Securityholder:

 

(a)           within
60 days after the end of each of the first three quarterly accounting periods
in each fiscal year of the Company, unaudited consolidated statements of income
and cash flows of the Company and its Subsidiaries for such quarterly period
and unaudited consolidated balance sheets of the Company and its Subsidiaries
as of the end of such quarterly period. Such financial statements shall be
prepared, in all material respects, in accordance with generally accepted
accounting principles, consistently applied, subject to the absence of footnote
disclosures and to normal year-end adjustments; and

 

(b)           within
120 days after the end of each fiscal year of the Company, audited consolidated
statements of income and cash flows of the Company and its Subsidiaries for
such fiscal year, and audited consolidated balance sheets of the Company and
its Subsidiaries as of the end of such fiscal year. Such financial statement
shall be prepared, in all material respects, in accordance with generally
accepted accounting principles, consistently applied.

 

12.           Definitions. As
used in this Agreement, the following terms shall have the meanings ascribed to
them in this Section 12:

 

“Acceptance Period”
has the meaning set forth in Section 6(a).

 

“Affiliate” of
any Person means any other Person, directly or indirectly controlling,
controlled by or under common control with such Person and any partner, member
or equityholder of such Person, where “control” means the possession, directly
or indirectly, of the power to direct the management and policies of a Person
whether through the ownership of voting securities, by contract or otherwise.

 

“Agreement”
has the meaning set forth in the preamble hereto.

 

“Amended Offer
Notice” has the meaning set forth in Section 3(b)(ii).

 

“Amended Sale Notice”
has the meaning set forth in Section 3(c).

 

“Bear Stearns”
means, collectively, The Bear Stearns Companies Inc. and its Subsidiaries.

 

“Blackford” has
the meaning set forth in the preamble hereto.

 

“Blackford Investor”
means Blackford or any of its Permitted Transferees.

 

“Blackford Shares”
means all Securityholder Shares issued or issuable to any Blackford Investor,
whether upon exercise of any Common Stock Equivalents, preemptive rights or
otherwise.

 

“Board” has the
meaning set forth in the preamble hereto.

 

“BSMB” has the
meaning set forth in the preamble hereto.

 

27

 

“BSMB Co-Investment”
has the meaning set forth in the preamble hereto.

 

“BSMB Directors”
has the meaning set forth in Section 1(a).

 

“BSMB Group”
means (a) BSMB, (b) Bear Stearns, (c) any investment fund
sponsored by Bear Stearns, (d) any investment fund managed by employees of
Bear Stearns, (e) the general partner or manager of any investment fund
described in clause (c) or (d) above, and (f) each of the partners,
members or equityholders of any Person described in clause (c), (d) or (e)
above (each on a pro rata basis).

 

“BSMB Investor” means any of BSMB
or any of its Permitted Transferees.

 

“BSMB Majority Holders”
means the holders of at least a majority of the Common Stock and Common Stock
Equivalents included in the BSMB Shares.

 

“BSMB Requesting Holders”
means the BSMB Majority Holders requesting registration of Registrable
Securities pursuant to Section 5A(a).

 

“BSMB Shares”
means all Securityholder Shares
issued or issuable to any BSMB Investor, whether upon exercise of any Common
Stock Equivalents, preemptive rights or otherwise.

 

“Business Day”
means any day except a Saturday, Sunday or a legal holiday in New York City.

 

“Cause”
means, with respect to any Other Holder, such Other Holder’s (i) continued failure, whether willful,
intentional, or grossly negligent, after written notice, to perform
substantially such Other Holder’s duties (the “Duties”) as determined by
such Other Holder’s immediate supervisor, the Chief Executive Officer or a
Senior Vice President of the Company, or the Board (other than as a result of a
disability); (ii) dishonesty or fraud in the performance of such Other Holder’s
Duties or a material breach of such Other Holder’s duty of loyalty to the
Company or its Subsidiaries; (iii) conviction or confession of an act or acts
on such Other Holder’s part constituting a felony under the laws of the United
States or any state thereof or a misdemeanor which materially impairs such
Other Holder’s ability to perform such Other Holder’s Duties; (iv) willful act
or omission on such Other Holder’s part which is materially injurious to the
financial condition or business reputation of the Company or any of its
Subsidiaries; or (v) breach of any non-competition, non-solicitation,
non-disclosure or confidentiality agreement applicable to such Other Holder.

 

“Certificate of
Incorporation” means the Certificate of Incorporation of the
Company, as amended from time to time.

 

“Common Stock”
means the Common Stock, par value $0.01 per share, of the Company.

 

“Common Stock Equivalents”
means (without duplication with any Common Stock or other Common Stock
Equivalents) rights, warrants, options, convertible securities, or exchangeable
securities or indebtedness, or other rights, exercisable for or convertible or 

 

28

 

exchangeable into,
directly or indirectly, Common Stock or securities exercisable for or
convertible or exchangeable into Common Stock, whether at the time of issuance
or upon the passage of time or the occurrence of some future event.

 

“Company” has
the meaning set forth in the preamble hereto.

 

“Company Repurchase
Period” has the meaning set forth in Section 10(c).

 

“Company Sale” means
the consummation of a transaction, whether in a single transaction or in a
series of related transactions, with any Independent Third Party or group of
Independent Third Parties pursuant to which such Person or Persons
(a) acquire (whether by merger, consolidation, recapitalization,
reorganization, redemption, transfer or issuance of capital stock or otherwise)
capital stock of the Company (or any surviving or resulting corporation)
possessing the voting power to elect a majority of the board of directors of
the Company (or such surviving or resulting corporation) or (b) acquire
assets constituting all or substantially all of the assets of the Company and
its Subsidiaries (as determined on a consolidated basis).

 

“Company’s Notice
of Intention to Sell” has the meaning set forth in Section 6(a).

 

“Covered Person”
has the meaning set forth in Section 5F(a).

 

“Credit Agreement”
means, the Credit Agreement dated as of the date hereof, by and among the
Company, Universal Hospital Services, Inc., the various lenders party thereto,
Merrill Lynch Capital, a division of Merrill Lynch Business Financial Services,
Inc., as Administrative Agent and the other lenders that are, or from time to
time become, parties thereto, as the same may be amended, restated, extended,
refunded, refinanced, replaced, supplemented, restructured or otherwise
modified from time to time (in whole or in part and without limitation as to
terms, conditions or covenants and without regard to the principal amount
thereof), including all related notes, collateral documents, guarantees,
instruments and agreements entered into in connection therewith, as the same
may be amended, modified, supplemented, restated, extended, renewed, refunded,
refinanced, restructured or replaced from time to time.

 

“Demand Registration”
has the meaning set forth in Section 5A(a).

 

“Demand Right”
has the meaning set forth in Section 5A(a).

 

“Directors”
has the meaning set forth in Section 1(a).

 

“Effective Time”
has the meaning set forth in the Merger Agreement.

 

“Election Period”
has the meaning set forth in Section 3(b).

 

“Exchange Act”
means the Securities Exchange Act of 1934, as amended from time to time.

 

“Excluded
Securities” has the meaning set forth in Section 3(c)(iv).

 

29

 

“Fair Market Value”
of any Repurchase Share shall be determined in good faith by the Board based on
such factors as the Board, in the exercise of its reasonable business judgment,
considers relevant; provided, that in making such determination, the
Board shall assume that the Company and its Subsidiaries are sold as a going
concern and then liquidated and shall not provide for any discounts based on
the fact that the Common Stock being valued represent a minority interest in
the Company.

 

“Family”
means, with respect to any Securityholder that is a natural person, such
Securityholder’s spouse, former spouse, descendants (whether natural or
adopted), parents and siblings and any trust, family limited partnership or
other similar entity established solely for the benefit of such person or such
person’s spouse, descendants (whether natural or adopted), parents or siblings.

 

“Good Reason”
means, with respect to any Other Holder, the occurrence of any of the
following: (i) the Company or its Subsidiaries has reduced or reassigned a
material portion of such Other Holder’s duties (per such Other Holder’s job
description); (ii) such Other Holder’s base salary has been reduced other than
in connection with an across-the-board reduction (of approximately the same
percentage) in executive compensation to employees imposed by the Board in
response to negative financial results or other adverse circumstances affecting
the Company or its Subsidiaries; or (iii) the Company or its Subsidiaries has
required such Other Holder to relocate in excess of fifty (50) miles from the
location where such Other Holder is currently employed.

 

“Incidental Registration” has the meaning set forth in Section 5B.

 

“Indemnified Party”
has the meaning set forth in Section 5F(c).

 

“Indemnifying Parties”
has the meaning set forth in Section 5F(c).

 

“Independent Third Party”
means any Person who, immediately prior to the contemplated transaction, does
not own in excess of 5% of the Company’s Common Stock on a fully-diluted basis
(a “5% Owner”), who is not controlling,
controlled by or under common control with any such 5% Owner and who is not the
spouse or descendent (by birth or adoption) of any such 5% Owner or a trust for
the benefit of such 5% Owner or such other Persons.

 

“IPO”
means an initial Public Offering of Common Stock or the Company otherwise
becoming a “reporting company” under Section 13 of the Exchange Act with regard
to a registration of Common Stock under Section 12 of the Exchange Act.

 

“Law” means any
federal, state, local or foreign law, rule, or regulation.

 

“Losses” has the
meaning set forth in Section 5F(a).

 

“Management Holders”
means, collectively, the Blackford Investors and the Other Investors.

 

30

 

“Merger Agreement”
means that certain Merger Agreement, dated as of April 15, 2007, by and among
the Company, UHS Merger Sub, Inc. Universal Hospital Services, Inc. and other
parties named therein, as amended, modified or supplemented from time to time).

 

“NASD” has the
meaning set forth in Section 5D(m).

 

“Offer Notice”
has the meaning set forth in Section 3(b).

 

“Offerees” has
the meaning set forth in Section 3(b).

 

“Other Holders”
has the meaning set forth in the preamble hereto.

 

“Other Investors”
means any of the Other Holders or any of its Permitted Transferees.

 

“Other Investor
Shares” means all Securityholder Shares issued or issuable to any
Other Investor, whether upon the exercise of any Common Stock Equivalents,
preemptive rights or otherwise.

 

“Other Registration Rights”
has the meaning set forth in Section 5A(a).

 

“Participation
Securityholders” has the meaning set forth in Section 3(c).

 

“Permitted Transferee”
has the meaning set forth in Section 3(d).

 

“Person” means
an individual, a partnership, a corporation, a limited liability company, an
association, a joint stock company, a trust, a joint venture, an unincorporated
organization or other entity and a governmental entity or any department,
agency or political subdivision thereof.

 

“Preemptive
Securities” has the meaning set forth in Section 6(a).

 

“Priority Right” has the meaning
set forth in Section 5A(c).

 

“Proceeding” has
the meaning set forth in Section 5F(c).

 

“Professional
Services Agreement” means that certain Professional Services
Agreement, dated as of the date hereof, by and among the Company and Bear
Stearns Merchant Manager III (Cayman), L.P., as amended, modified or
supplemented from time to time.

 

“Public Offering”
means any offering by the Company of its capital stock or equity securities to
the public pursuant to an effective registration statement under the Securities
Act; provided that a
Public Offering shall not include an offering made in connection with a
business acquisition or combination or an employee benefit plan.

 

“Public Sale”
means any sale of Securityholder Shares pursuant to a Public Offering or a Rule
144 Sale.

 

“Purchasing Holder”
has the meaning set forth in Section 6(f).

 

31

 

“Qualified Public Offering”
means a Public Offering which results in proceeds (net of underwriting
discounts and selling commissions) of at least $100,000,000 and after which the
Company’s equity securities are listed on a national securities exchange or the
NASDAQ Stock Market.

 

“Registrable
Securities” means for any Securityholder (a) any shares of Common
Stock held by such Securityholder and (b) any shares of Common Stock issued or
issuable upon the exercise, conversion or exchange of all Common Stock
Equivalents held by such Securityholder. As to any particular Registrable
Securities, such securities shall cease to be Registrable Securities when they
have been (i) Transferred in a Public Sale or (ii) otherwise
Transferred and new certificates for them not bearing the legend set forth in Section 7
shall have been delivered by the Company and subsequent disposition of such
securities shall not require registration or qualification of such securities
under the Securities Act or such state securities or blue sky laws then in
force. Notwithstanding the foregoing, the Company shall not be required to
register any securities other than shares of its Common Stock.

 

“Registration”
means the registration of Registrable Securities pursuant to a Registration
Statement filed pursuant to Section 5.

 

“Registration Notice”
has the meaning set forth in Section 5A(a).

 

“Registration Request”
has the meaning set forth in Section 5A(a).

 

“Registration
Statement” means any registration statement of the Company filed
with the SEC pursuant to the Securities Act (other than a registration
statement on Form S-4 or Form S-8 or any similar or successor form), including
the prospectus, amendments and supplements to such registration statement,
including post-effective amendments, all exhibits, and all material
incorporated by reference or deemed to be incorporated by reference in such
registration statement.

 

“Repurchase Notice”
has the meaning set forth in Section 10(c).

 

“Repurchase Option”
has the meaning set forth in Section 10(a).

 

 “Repurchase Price” has the meaning set
forth in Section 10(b).

 

“Repurchase Shares”
has the meaning set forth in Section 10(a).

 

“Rule 144 Sale”
means a sale of Securityholder Shares to the public through a broker, dealer or
market-maker pursuant to the provisions of Rule 144 (other than Rule 144(k)
prior to a Public Offering) adopted under the Securities Act (or any successor
rule or regulation).

 

“Sale Notice”
has the meaning set forth in Section 3(c).

 

“Schedule of Investors”
has the meaning set forth in the preamble hereto.

 

“SEC”
means the United States Securities and Exchange Commission.

 

32

 

“Section 3(c)
Transferring Securityholder” has the meaning set forth in Section 3(c).

 

“Securities Act”
means the Securities Act of 1933, as amended from time to time.

 

“Securityholder”
means, collectively, the BSMB Investors, the Blackford Investors and the Other
Investors.

 

“Securityholder Shares”
means (a) any capital stock of the Company purchased or otherwise acquired
by any Securityholder, and
(b) any securities issued or issuable directly or indirectly with respect
to any of the securities described in clause (a) above, in each case, by
way of stock dividend or other distribution or stock split, or in connection
with a combination of shares, recapitalization, merger, consolidation or other
reorganization. As to any particular shares constituting Securityholder Shares, such shares
shall cease to be Securityholder
Shares when they have been acquired by the Company or sold pursuant to a Public
Sale.

 

“Senior Notes”
means the Second Lien Senior Secured Floating Rate Notes due 2015 and the Second Lien Senior Secured PIK Toggle Notes
due 2015, issued by the Company.

 

“Stock Option Plan”
means the Company’s stock option plan that has been approved by the Board.

 

“Sub Board” has
the meaning set forth in Section 1(a).

 

“Subsidiary”
means, with respect to any Person, any corporation, limited liability company,
partnership, association or other business entity of which (i) if a
corporation, a majority of the total voting power of shares of stock entitled
(without regard to the occurrence of any contingency) to vote in the election
of directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by that Person or one or more of the other Subsidiaries
of that Person or a combination thereof, or (ii) if a limited liability
company, partnership, association or other business entity, a majority of the
limited liability company, partnership or other similar ownership interest
thereof is at the time owned or controlled, directly or indirectly, by any
Person or one or more Subsidiaries of that Person or a combination thereof. For
purposes hereof, a Person or Persons shall be deemed to have a majority
ownership interest in a limited liability company, partnership, association or
other business entity if such Person or Persons shall be allocated a majority
of limited liability company, partnership, association or other business entity
gains or losses or shall be or control the managing director or general partner
of such limited liability company, partnership, association or other business
entity.

 

“Termination Date”
has the meaning set forth in Section 10(a).

 

“Transaction
Documents” means, collectively, the Merger Agreement, the
Professional Services Agreement, this Agreement, the Certificate of
Incorporation, the Company’s bylaws, the Credit Agreement and any other
agreement or document contemplated by any of the foregoing.

 

“Transfer” means
any direct or indirect sale, transfer, assignment, pledge, encumbrance or other
disposition (whether with or without consideration and whether 

 

33

 

voluntarily or
involuntarily or by operation of Law) including any derivative transaction that
has the effect of
changing materially the economic benefits and risks of ownership (and “Transferee,” “Transferor” and any other derivation thereof shall have
correlative meanings).

 

“Transferring Holder”
has the meaning set forth in Section 3(b).

 

“UHS”
means Universal Hospital Services, Inc.

 

“Valuation Date”
has the meaning set forth in Section 10(b).

 

13.           Severability.
Whenever possible, each provision of this Agreement shall be interpreted in
such manner as to be effective and valid under applicable Law, but if any
provision of this Agreement is held to be invalid, illegal or unenforceable in
any respect under any applicable Law in any jurisdiction, such invalidity,
illegality or unenforceability shall not affect the validity, legality or
enforceability of any other provision of this Agreement in such jurisdiction or
affect the validity, legality or enforceability of any provision in any other
jurisdiction, but this Agreement shall be reformed, construed and enforced in
such jurisdiction as if such invalid, illegal or unenforceable provision had
never been contained herein.

 

14.           Entire
Agreement. Except as otherwise expressly set forth herein, this Agreement
embodies the complete agreement and understanding among the parties hereto with
respect to the subject matter hereof and supersedes and preempts any prior
understandings, agreements or representations by or among the parties, written
or oral, which may have related to the subject matter hereof in any way.

 

15.           Successors
and Assigns. Except as otherwise provided herein, this Agreement shall bind
and inure to the benefit of and be enforceable by the Company and its
successors and assigns and the Securityholders and any subsequent holders of
Securityholder Shares and the respective permitted successors and assigns of
each of them, so long as they hold Securityholder Shares; provided, that
Section 5F shall continue to apply with respect to any of the
Securityholder Shares that were sold, assigned or transferred pursuant to the
registration rights granted under Section 5.

 

16.           Counterparts.
This Agreement may be executed in multiple counterparts, each of which shall be
an original and all of which taken together shall constitute one and the same
agreement.

 

17.           Remedies.
The Company and the Securityholders shall be entitled to enforce their rights
under this Agreement specifically, to recover damages by reason of any breach
of any provision of this Agreement and to exercise all other rights existing in
their favor. The parties hereto agree and acknowledge that money damages would
not be an adequate remedy for any breach of the provisions of this Agreement
and that the Company and any Securityholder may in its sole discretion apply to
any court of law or equity of competent jurisdiction for specific performance
or injunctive relief (without posting a bond or other security) in order to
enforce or prevent any violation of the provisions of this Agreement.

 

18.           Termination.
Notwithstanding anything to the contrary in this Agreement, this Agreement
shall automatically terminate and be of no further force and effect immediately

 

34

 

after the consummation of
a Company Sale, except that the provisions of Sections 5F, 8, 14,
15, 17, 18, 19, 20 and 21 shall
survive the consummation of a Company Sale if a Demand Registration or
Incidental Registration has occurred prior to such Company Sale.

 

19.           Notices.
Any notice provided for in this Agreement shall be in writing and shall be
either personally delivered, or sent via facsimile or mailed first class mail
(postage prepaid) or sent by reputable overnight courier service (charges
prepaid) to the Company at the address set forth below and to any other
recipient at the address indicated on the schedules hereto and to any
subsequent holder of Securityholder Shares subject to this Agreement at such
address as indicated by the Company’s records, or at such address or to the
attention of such other person as the recipient party has specified by prior
written notice to the sending party. Notices shall be deemed to have been given
hereunder when delivered personally, when sent via facsimile (as evidenced by a
printed confirmation) if sent prior to 5:00 p.m. (local time of recipient) on a
Business Day or, if not, the next succeeding Business Day), three (3) Business
Days after deposit in the U.S. mail and one (1) Business Day after deposit with
a reputable overnight courier service. The Company’s address is:

 

UHS Holdco, Inc.

770 France Avenue South, Suite 275

Edina, Minnesota 55435-5228

Attention: Gary Blackford

Fax:         952-893-0704

 

With copies, which shall not constitute notices, to:

 

Bear Stearns Merchant Banking Partners III, L.P.

383 Madison Avenue, 40th Floor

New York, New York  10179

Attention: Robert Juneja

Fax:         212-881-9516

 

Dorsey & Whitney LLP

50 South Sixth Street, Suite 1500

Minneapolis, MN 55402-1498

Attention:  Deborah Vigdal

Fax:         612-340-2868

 

and

 

Kirkland & Ellis LLP

153 East 53rd Street

New York, New York 10022

Attention:  Michael T. Edsall and Jai
Agrawal 

Fax:         212-446-6460

 

20.           Governing
Law; Jurisdiction. The corporate law of the State of Delaware shall govern
all issues and questions concerning the relative rights of the Company and its
stockholders. All other issues and questions concerning the construction,
validity, interpretation 

 

35

 

and enforceability of
this Agreement and the exhibits and schedules hereto shall be governed by, and
construed in accordance with, the laws of the State of Delaware, without giving
effect to any choice of law or conflict of law rules or provisions (whether of
the State of Delaware or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of Delaware. The
parties hereto hereby irrevocably and unconditionally submit to the exclusive
jurisdiction of any Federal court sitting in the State of Minnesota over any
suit, action or proceeding arising out of or relating to this Agreement. The
parties hereby agree that service of any process, summons, notice or document
by U.S. registered mail addressed to any such party shall be effective service
of process for any action, suit or proceeding brought against a party in any
such court. The parties hereto hereby irrevocably and unconditionally waive any
objection to the laying of venue of any such suit, action or proceeding brought
in any such court and any claim that any such suit, action or proceeding
brought in any such court has been brought in an inconvenient forum. The
parties hereto agree that a final judgment in any such suit, action or
proceeding brought in any such court shall be conclusive and binding upon any
party and may be enforced in any other courts to whose jurisdiction any party
is or may be subject, by suit upon such judgment.

 

21.           Waiver
of Jury Trial. EACH OF THE PARTIES HERETO WAIVES ANY RIGHT IT MAY HAVE TO
TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON, ARISING OUT OF, UNDER OR
IN CONNECTION WITH THIS AGREEMENT OR ANY COURSE OF CONDUCT, COURSE OF DEALING,
VERBAL OR WRITTEN STATEMENT OR ACTION OF ANY PARTY HERETO.

 

22.           Business
Days. If any time period for giving notice or taking action hereunder
expires on a day which is not a Business Day, the time period shall
automatically be extended to the Business Day immediately following such day.

 

23.           Descriptive
Headings; Construction. The descriptive headings of this Agreement are
inserted for convenience only and do not constitute a part of this Agreement. The
parties to this Agreement have participated jointly in the negotiation and
drafting of this Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly
by the parties and no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of the authorship of any of the provisions of
this Agreement. The word “including” shall mean including without limitation.

 

24.           Rights of
Securityholders. This Agreement affects the Securityholders only in their
capacities as stockholders of the Company, or for purposes of Section 1,
as a stockholder, director, member of a board or committee thereof, officer of
the Company or otherwise.

 

[END OF PAGE]

[SIGNATURE PAGES FOLLOW]

 

36

 

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

 

	
   

  	
  UHS HOLDCO, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gary Blackford

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  Name: Gary Blackford

  
	
   

  	
   

  	
  Title: Chief Executive Officer & President

  

 

 

	
   

  	
  BSMB/UHS,
  L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  MBPIII GP, LLC

  
	
   

  	
  a general partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Bear Stearns Merchant
  Banking Partners III, L.P.

  
	
   

  	
  its Sole Member

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Bear Stearns Merchant
  Capital (Cayman) III, L.P.

  
	
   

  	
  a general partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  JDH Management LLC

  
	
   

  	
  a general partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert Juneja

  	
   

  
	
   

  	
   

  	
  Name: Robert Juneja

  
	
   

  	
   

  	
  Title: Managing
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BSMB/UHS
  CO-INVESTMENT PARTNERS, L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  MBPIII GP, LLC

  
	
   

  	
  a general partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Bear Stearns Merchant
  Banking Partners III, L.P.

  
	
   

  	
  its Sole Member

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  Bear Stearns Merchant
  Capital (Cayman) III, L.P.

  
	
   

  	
  a general partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  JDH Management LLC

  
	
   

  	
  a general partner

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Robert Juneja

  	
   

  
	
   

  	
   

  	
  Name: Robert Juneja

  
	
   

  	
   

  	
  Title: Managing
  Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  

 

 

	
   

  	
  /s/ Gary D. Blackford

  	
   

  
	
   

  	
  Gary D. Blackford

  
	
   

  	
   

  
	
   

  	
  /s/ Kathy Blackford

  	
   

  
	
   

  	
  Kathy Blackford

  
	
   

  	
   

  
	
   

  	
  /s/ David E. Dovenberg

  	
   

  
	
   

  	
  David E. Dovenberg

  
	
   

  	
   

  
	
   

  	
  /s/ Susan E. Ellington

  	
   

  
	
   

  	
  Susan E. Ellington

  
	
   

  	
   

  
	
   

  	
  /s/ Margaret Everist

  	
   

  
	
   

  	
  Margaret Everist

  
	
   

  	
   

  
	
   

  	
  /s/ David G. Lawson

  	
   

  
	
   

  	
  David G. Lawson

  
	
   

  	
   

  
	
   

  	
  /s/ Kathleen Hawkins

  	
   

  
	
   

  	
  Kathleen Hawkins

  
	
   

  	
   

  
	
   

  	
  /s/ John D. Ainsworth

  	
   

  
	
   

  	
  John D. Ainsworth

  
	
   

  	
   

  
	
   

  	
  /s/ Lori J. Ainsworth

  	
   

  
	
   

  	
  Lori J. Ainsworth

  
	
   

  	
   

  
	
   

  	
  /s/ Walter T. Chesley

  	
   

  
	
   

  	
  Walter T. Chesley

  

 

 

	
   

  	
   

  
	
   

  	
  /s/ Timothy W. Kuck

  	
   

  
	
   

  	
  Timothy W. Kuck

  
	
   

  	
   

  
	
   

  	
  /s/ Jeffrey L. Singer

  	
   

  
	
   

  	
  Jeffrey L. Singer

  
	
   

  	
   

  
	
   

  	
  /s/ Darren J. Thieding

  	
   

  
	
   

  	
  Darren J. Thieding

  
	
   

  	
   

  
	
   

  	
  /s/ Dale Voegeli

  	
   

  
	
   

  	
  Dale Voegeli

  
	
   

  	
   

  
	
   

  	
  /s/ Rex Clevenger

  	
   

  
	
   

  	
  Rex Clevenger

  

 

 

SCHEDULE OF
INVESTORS

 

	
  Name and Address

  	
   

  	
  Common Stock

  	
   

  	
  Joinder Date

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  BSMB/UHS, L.P.

  c/o MBPIII GP,
  LLC

  383 Madison
  Avenue, 40th Fl.

  New York, New
  York  10179

  Fax:  (212) 272-7425

  Attention:
  Robert Juneja

   

  With a copy,
  which shall not constitute notice, to:

   

  Kirkland &
  Ellis LLP

  153 East 53rd
  Street

  New York, New
  York  10022

  Attention:  Michael T. Edsall and Jai Agrawal

  Fax:         212-446-6460

  	
   

  	
  175,000,000

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  BSMB/UHS
  CO-INVESTMENT PARTNERS, L.P.

  c/o MBPIII GP,
  LLC

  383 Madison
  Avenue, 40th Fl.

  New York, New
  York  10179

  Fax:  (212) 272-7425

  Attention:
  Robert Juneja

  With a copy,
  which shall not constitute notice, to:

  Kirkland &
  Ellis LLP

  153 East 53rd
  Street

  New York, New
  York  10022

  Attention:  Michael T. Edsall and Jai Agrawal

  Fax:         212-446-6460

  	
   

  	
  63,913,306

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Gary D. Blackford

  	
   

  	
  2,221,888

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Kathy Blackford

  	
   

  	
  1,702,499

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  David E. Dovenberg

  	
   

  	
  995,804

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Susan E. Ellington

  	
   

  	
  93,152

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Margaret A. Everist

  	
   

  	
  99,581

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  David G. Lawson

  	
   

  	
  499,825

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Kathleen Hawkins

  	
   

  	
  69,455

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  John D. Ainsworth and
  Lori J. Ainsworth

  	
   

  	
  687,896

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Walter T. Chesley

  	
   

  	
  439,662

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Timothy W. Kuck

  	
   

  	
  499,854

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Jeffery L. Singer

  	
   

  	
  1,991,609

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Darren J. Thieding

  	
   

  	
  99,581

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Dale Voegeli

  	
   

  	
  379,651

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Rex Clevenger

  	
   

  	
  100,000

  	
   

  	
   

  	
   

  

 

 

EXHIBIT A

 

FORM OF JOINDER TO

SECURITYHOLDERS AGREEMENT

 

THIS JOINDER (the “Joinder”) to the
Securityholders Agreement, dated as of May 31, 2007  by and among UHS Holdco, Inc., a Delaware corporation (the “Company”) and certain securityholders of the Company (the “Agreement”),
is made and entered into as of              
by and between the Company and               
(“Holder”). Capitalized terms
used but not otherwise defined herein shall have the meanings set forth in the
Agreement.

 

WHEREAS, Holder has acquired certain shares of Common Stock
(“Holder Shares”), and the
Agreement and the Company requires Holder, as a holder of such Common Stock, to
become a party to the Agreement, and Holder agrees to do so in accordance with
the terms hereof.

 

NOW, THEREFORE, in consideration of the mutual
covenants contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties to this
Joinder hereby agree as follows:

 

1.             Agreement
to be Bound. Holder hereby agrees that upon execution of this Joinder, it
shall become a party to the Agreement and shall be fully bound by, and subject
to, all of the covenants, terms and conditions of the Agreement as though an
original party thereto and shall be deemed a [Blackford/BSMB/Other
Investor] for all purposes thereof. In addition, Holder hereby
agrees that all Holder Shares shall be deemed [Blackford/BSMB/Other
Investor] Shares for all purposes
of the Agreement.

 

2.             Notices.
For purposes of Section 19 of the Agreement, all notices, demands
or other communications to the Holder shall be directed to:

 

                                                         

                                                         

Tel:                                                   

Fax:                                                   

 

3.             Successors
and Assigns. Except as otherwise provided in the Agreement, this Joinder
shall bind and inure to the benefit of and be enforceable by the Company and
its successors and assigns and the Holder and any subsequent holders of Holder
Shares and the respective permitted successors and assigns of each of them, so
long as they hold Holder Shares; provided, that Section 5F of the
Agreement shall continue to apply with respect to any of the Holder Shares that
were sold, assigned or transferred pursuant to the registration rights granted
under Section 5 of the Agreement.

 

4.             Counterparts.
This Joinder may be executed in multiple counterparts, each of which shall be
an original and all of which taken together shall constitute one and the same
agreement.

 

B-1

 

5.             Governing Law;
Jurisdictio The corporate law of the State of Delaware shall govern all
issues and questions concerning the relative rights of the Company and its
stockholders. All other issues and questions concerning the construction,
validity, interpretation and enforceability of the Agreement, including this
Joinder, and the exhibits and schedules thereto shall be governed by, and
construed in accordance with, the laws of the State of Delaware, without giving
effect to any choice of law or conflict of law rules or provisions (whether of
the State of Delaware or any other jurisdiction) that would cause the
application of the laws of any jurisdiction other than the State of Delaware. The
parties hereto hereby irrevocably and unconditionally submit to the exclusive
jurisdiction of any Federal court sitting in Minneapolis, Minnesota over any
suit, action or proceeding arising out of or relating to this Joinder or the
Agreement. The parties hereby agree that service of any process, summons,
notice or document by U.S. registered mail addressed to any such party shall be
effective service of process for any action, suit or proceeding brought against
a party in any such court. The parties hereto hereby irrevocably and
unconditionally waive any objection to the laying of venue of any such suit,
action or proceeding brought in any such court and any claim that any such
suit, action or proceeding brought in any such court has been brought in an
inconvenient forum. The parties hereto agree that a final judgment in any such
suit, action or proceeding brought in any such court shall be conclusive and
binding upon any party and may be enforced in any other courts to whose
jurisdiction any party is or may be subject, by suit upon such judgment.

 

6.             WAIVER
OF JURY TRIAL. EACH OF THE PARTIES HERETO WAIVES ANY RIGHT IT MAY HAVE TO
TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON, ARISING OUT OF, UNDER OR
IN CONNECTION WITH THIS JOINDER OR THE AGREEMENT OR ANY COURSE OF CONDUCT,
COURSE OF DEALING, VERBAL OR WRITTEN STATEMENT OR ACTION OF ANY PARTY HERETO OR
THERETO.

 

7.             Business
Days. If any time period for giving notice or taking action hereunder
expires on a day which is not a Business Day, the time period shall
automatically be extended to the Business Day immediately following such day.

 

8.             Descriptive
Headings; Construction. The descriptive headings of this Joinder are
inserted for convenience only and do not constitute a part of this Joinder. The
parties to this Joinder have participated jointly in the negotiation and
drafting of this Joinder. In the event an ambiguity or question of intent or
interpretation arises, this Joinder shall be construed as if drafted jointly by
the parties and no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of the authorship of any of the provisions of
this Joinder. The word “including” shall mean including without limitation.

 

*         
*          *

 

B-2

 

IN WITNESS WHEREOF, the parties
hereto have executed this Joinder as of the date first above written.

 

	
   

  	
  COMPANY:

  
	
   

  	
   

  
	
   

  	
  UHS HOLDCO, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Its:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HOLDER:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:Exhibit 10.10

 

PROFESSIONAL
SERVICES AGREEMENT

 

This Professional Services Agreement (this “Agreement”)
is made as of May 31, 2007, by and among Bear Stearns Merchant Manager III
(Cayman), L.P., a Cayman Islands exempted limited partnership (“BSMB”),
and Universal Hospital Services, Inc. (the “Company”), a Delaware
corporation. Certain capitalized terms used herein are defined in Section 9
below.

 

WHEREAS, the Company, UHS Holdco, Inc., a Delaware
corporation (“Holdco”), UHS Merger Sub, Inc., a Delaware corporation,
and J.W. Childs Equity Partners III, L.P., in its capacity as a representative
of the stockholders of the Company, are parties to an Agreement and Plan of
Merger, dated as of April 15, 2007 (the “Merger Agreement”); and

 

WHEREAS, the Company desires to retain BSMB with
respect to the services described herein.

 

NOW, THEREFORE, the parties agree as follows:

 

1.             Term.
This Agreement shall commence on the date hereof and shall terminate (except as
provided in the immediately following sentence) on the earliest to occur of
(a) the consummation of a Qualified Public Offering, (b) the
consummation of a Company Sale, and (c) the tenth anniversary of the date
hereof (the “Term”); provided, that if no Qualified Public
Offering or Company Sale has been consummated prior to the tenth anniversary,
the Term shall be automatically extended thereafter on a year to year basis
unless (i) the Company provides written notice to BSMB of its desire to
terminate this Agreement or (ii) BSMB provides written notice to the Company
of its desire to terminate this Agreement, in each case 90 days prior to the
expiration of the Term or any extension thereof, or at such time as a Qualified
Public Offering or Company Sale is consummated. The provisions of Sections 3(d),
6, 7, 8, 10, 11, 12, 14, 15
and obligations to pay any outstanding unpaid fees hereunder and accrued
interest thereon shall survive the termination of this Agreement.

 

2.             Services.
BSMB shall perform or cause to be performed such services for the Company and
its subsidiaries as mutually agreed by BSMB and the Company’s board of
directors, which may include, without limitation, the following:

 

(a)           general
advisory and management services;

 

(b)           business
development functions, including identification, support, negotiation and
analysis of acquisitions and dispositions by the Company or its subsidiaries;

 

(c)           support,
negotiation and analysis of financing alternatives, including, without
limitation, in connection with acquisitions, capital expenditures and
refinancing of existing indebtedness;

 

(d)           finance
functions, including assistance in the preparation of financial projections,
and monitoring of compliance with financing agreements;

 

(e)           marketing
functions, including monitoring of marketing plans and strategies;

 

 

(f)            human
resource functions, including searching, identifying and hiring of executives
and directors; and

 

(g)           other
services for the Company and its subsidiaries upon which the Company’s board of
directors and BSMB agree.

 

3.             Advisory
Fee.

 

(a)           In
consideration of BSMB’s undertaking to provide advisory services hereunder, the
Company shall pay BSMB an annual advisory fee (the “Advisory Fee”) in an
amount for each fiscal year equal to the greater of (x) $500,000 and (y) 0.75%
of Adjusted EBITDA of the Company and its subsidiaries for the immediately
preceding fiscal year, calculated as provided below and payable in advance in
quarterly installments, for the period beginning on the date hereof and ending
upon the termination of this Agreement as provided in Section 1 hereof; provided,
that the annual Advisory Fee for the fiscal year ending December 31, 2007 shall
be $500,000. The Advisory Fees shall be payable by the Company whether or not
the Company actually requests that BSMB provide the services described in Section 2
above. All Advisory Fees shall be fully earned when paid.

 

(b)           The
first installment of the Advisory Fee, for the period beginning on the date
hereof and ending June 30, 2007, shall be payable on the date hereof
(unless otherwise directed by BSMB) in an amount equal to $125,000 multiplied
by a fraction, (i) the numerator of which is the actual number of days
from and including the date hereof to and including June 30, 2007, and
(ii) the denominator of which is 90.

 

(c)           Except
as otherwise provided in Section 3(d) or 3(e) hereof,
all subsequent payments of the Advisory Fee shall be in quarterly installments,
payable on March 31, June 30, September 30 and December 31
of each year, in an amount equal to the greater of (x) $125,000 or (y)  the product of (i) 25% and (ii) 0.75% of
Adjusted EBITDA of the Company and its subsidiaries for the immediately
preceding fiscal year; provided, that the portion of the Advisory Fee
payable on September 30, 2007 and December 31, 2007 shall be $125,000 each.

 

(d)           Upon
a Company Sale or the consummation of a Qualified Public Offering, the Company
shall be obligated to pay to BSMB the Advisory Fee that would be payable to
BSMB pursuant to this Section 3 in respect of the next four
successive three-month periods calculated based on the Advisory Fee paid or
payable for the then current three-month period.

 

(e)           Notwithstanding
anything to the contrary contained herein, the Company shall accrue but not pay
the Advisory Fee if and for so long as (i) any such payment would constitute
a default (or any event which might, with the lapse of time or the giving of
notice or both, constitute a default) under the Company’s financing agreements
(a “Default”); provided, that the Company shall be obligated to
pay any accrued Advisory Fees deferred under this clause (i) to the extent
that such payment would not constitute a Default or (ii) BSMB instructs
the Company not to pay all or any portion of the Advisory Fee during any fiscal
year. Interest will accrue on all due and unpaid Advisory Fees not paid
pursuant to clause (i) of the preceding sentence at the Default Rate until
such Advisory Fees are paid, and such interest shall compound annually.

 

2

 

(f)            In
addition to the Advisory Fee, the Company shall reimburse BSMB, promptly upon
request, for all reasonable out-of-pocket expenses incurred in the ordinary
course of business by BSMB in connection with BSMB’s obligations hereunder,
including fees and expenses paid to consultants, subcontractors, advisors and
other third parties in connection with such obligations.

 

4.             Transaction
Fees. The Company hereby agrees to pay to BSMB upon the date hereof a fee
(the “Closing Fee”) for services rendered in connection with securing,
structuring and negotiating the acquisition, equity and debt financing for the
transactions contemplated by the Merger Agreement and certain other management
services in an amount equal to $10,000,000. The Closing Fee shall be payable by
wire transfer of immediately available funds to BSMB or one or more of its
designees. In addition, the Company shall either pay directly or reimburse BSMB
for all of the reasonable out-of-pocket fees and expenses, including legal and
accounting fees, incurred by BSMB or any of its affiliates (other than the
Company or any of its subsidiaries) in connection with the negotiation and
execution of the Merger Agreement and the consummation of the transactions
contemplated by the Merger Agreement.

 

5.             Personnel.
BSMB shall provide and devote to the performance of this Agreement such
partners, employees and agents of BSMB as BSMB shall deem appropriate to the
furnishing of the services required.

 

6.             Liability.
None of BSMB, any of its affiliates nor their respective partners, members,
employees or agents (collectively, the “BSMB Group”) shall be liable to
the Company or its subsidiaries or affiliates for any loss, liability, damage
or expense (collectively, a “Loss”) arising out of or in connection with
the performance of services contemplated by this Agreement, unless and then
only to the extent that such Loss is determined by a court in a final order
from which no appeal can be taken, to have resulted solely from the gross
negligence or willful misconduct on the part of such member of the BSMB Group. BSMB
makes no representations or warranties, express or implied, in respect of the
services to be provided by the BSMB Group. Except as BSMB may otherwise agree
in writing on or after the date hereof: 
(a) each member of the BSMB Group shall have the right to, and
shall have no duty (contractual or otherwise) not to, directly or
indirectly:  (i) engage in the same
or similar business activities or lines of business as the Company or its
subsidiaries and (ii) do business with any client, customer, supplier,
lender or investor of, to or in the Company or its subsidiaries; (b) no
member of the BSMB Group shall be liable to the Company or its subsidiaries or
affiliates for breach of any duty (contractual or otherwise) by reason of any
such activities or of such person’s participation therein; and (c) in the
event that any member of the BSMB Group acquires knowledge of a potential
transaction or matter that may be a corporate opportunity for both (A) the
Company or any of its subsidiaries, on the one hand, and (B) BSMB, on the
other hand, or any other person, no member of the BSMB Group shall have any
duty (contractual or otherwise) to communicate or present such corporate
opportunity to the Company or its subsidiaries and, notwithstanding any
provision of this Agreement to the contrary, shall not be liable to the
Company, its subsidiaries or any of their affiliates for breach of any duty
(contractual or otherwise) by reasons of the fact that any member of the BSMB
Group directly or indirectly pursues or acquires such opportunity for itself,
directs such opportunity to another person, or does not present such
opportunity to the Company, its subsidiaries or any of their affiliates. In no
event will any of the parties hereto be liable to any other party hereto for any
punitive, exemplary, indirect, special, incidental or consequential damages,
including lost profits or savings, whether or not such damages are foreseeable,
or in

 

3

 

respect of any liabilities relating to any third party
claims (whether based in contract, tort or otherwise), other than for the
Claims (as defined in Section 7) relating to the services which may
be provided by BSMB hereunder.

 

7.             Indemnity.
The Company and its subsidiaries shall defend, indemnify and hold harmless each
member of the BSMB Group from and against any and all Losses arising from any
claim by any person with respect to, or in any way related to, this Agreement
(including attorneys’ fees) (collectively, “Claims”) resulting from any act
or omission of any member of the BSMB Group except to the extent that such Loss
is determined by a court in a final order from which no appeal can be taken to
have resulted solely from the gross negligence or willful misconduct of such
member of the BSMB Group. The Company and its subsidiaries shall defend at its
own cost and expense any and all suits or actions (just or unjust) which may be
brought against the Company and its subsidiaries or any member of the BSMB
Group, or in which any member of the BSMB Group may be impleaded with others
upon any Claims, or upon any matter, directly or indirectly, related to or
arising out of this Agreement or the performance of the obligations hereunder
by the BSMB Group, except that if such damage shall be proven to result solely
from gross negligence or willful misconduct by a member of the BSMB Group, then
such member of the BSMB Group shall reimburse the Company and its subsidiaries
for the costs of defense and other costs incurred by the Company and its
subsidiaries.

 

8.             Notices.
All notices hereunder shall be in writing and shall be delivered personally or
mailed by United States mail, postage prepaid, addressed to the parties as
follows:

 

to the Company:

 

Universal
Hospital Services, Inc.

7700
France Avenue South, Suite 275

Edina,
Minnesota 55435-5228

Attention:  Chief Executive Officer

Fax:  (952) 893-0704

 

with copies, which shall
not constitute notice, to:

 

Bear
Stearns Merchant Banking

c/o
Bear, Stearns & Co. Inc.

383
Madison Avenue, 40th Floor

New
York, New York 10179-5706

Attention:  Robert Juneja

Tel.:        212-272-1231

Fax:         212-881-9516

 

4

 

to BSMB:

 

Bear
Stearns Merchant Manager III (Cayman), L.P.

c/o
Bear, Stearns & Co. Inc.

383
Madison Avenue, 40th Floor

New York,
New York 10179-5706

Attention:  Robert Juneja

Tel.:        212-272-1231

Fax:         212-881-9516

 

with a
copy, which shall not constitute notice, to:

 

Kirkland &
Ellis LLP

153
East 53rd Street

New
York, NY  10022

Attention:  Michael T. Edsall and Jai Agrawal

Tel.:        212-446-4928

Fax:         212-446-6460

 

9.             Certain
Definitions. For purposes of this Agreement,

 

“Adjusted EBITDA” means, with respect to the
Company and its subsidiaries, on a consolidated basis, for any fiscal year, the
sum of: (i) the net income for such fiscal year (before the payment of any
dividends and excluding the effect of any extraordinary gains or losses during
such period and the effect of any purchase accounting adjustments as a result
of the acquisition of the Company by Holdco), plus (ii) interest expense,
federal, state, foreign and local income, franchise, and other similar taxes,
depreciation and amortization for such fiscal year, plus (iii) the
Advisory Fees paid under this Agreement, any management fees paid to any other institutional investor that owns
shares of Common Stock (including for fiscal year 2007 only, any management
fees paid by the Company or its subsidiaries during the period from January 1,
2007 to May 31, 2007 pursuant to (x) that certain Management Agreement, dated
as of October 17, 2003, between Halifax GenPar, L.P. and the Company and (y)
that certain Management Agreement, dated as of February 28, 1998, between J.W.
Childs Associates, L.P. and the Company, as amended by that certain Amendment
to Management Agreement, dated as of October 17, 2003, between J.W. Childs
Associates, L.P. and the Company) and any director fees paid to members of the
Board, in each case, during such fiscal year, plus (iv) for fiscal year 2007 only, any consulting
fees paid by the Company to L.E.K. Consulting during the period from January 1,
2007 to May 31, 2007, plus (v) any non-cash charges to the extent
that such charges will not result in a cash charge in any future period
(including any non-cash expenses relating to the options under FAS 123(R)) during
such fiscal year, plus (vi) non-capitalized transaction fees and
expenses incurred in connection with the acquisition of the Company by Holdco
during such fiscal year, plus (vii) any fees paid by the Company to David Dovenberg, but not to exceed
$250,000 in any fiscal year,  plus (or minus) (viii) any unusual and non-recurring losses (or
gains) for such fiscal year, minus (ix) any non-cash gains during
such fiscal year, in each case, as determined in accordance with United States
generally accepted accounting principles and as set forth on the Company’s
financial statements for such fiscal year which have been approved by the board
of directors of Holdco.

 

5

 

“Company Sale” means a transaction with an
independent third party or group of independent third parties acting in
concert, pursuant to which such party or parties acquire (i) all or
substantially all of the equity securities of Holdco or the Company or
(ii) all or substantially all of the assets of Holdco or the Company, as
determined on a consolidated basis (in either case, whether by merger,
consolidation, sale, exchange, issuance, transfer or redemption of equity
securities, by sale, exchange or transfer of assets, or otherwise).

 

“Default Rate” means 10.0% per annum.

 

“Qualified Public Offering” means an
underwritten sale to the public of Holdco’s equity securities pursuant to an
effective registration statement filed with the Securities and Exchange
Commission on Form S-1 (or any successor form) which results in proceeds (net
of underwriting discounts and selling commissions) of an aggregate (together
with proceeds from all previous Public Offerings) of at least $100,000,000 and
after which Holdco’s equity securities are listed on a national securities
exchange or the NASDAQ Stock Market; provided that a Qualified Public
Offering shall not include any issuance of equity securities in any merger or
other business combination, and shall not include any registration of the
issuance of securities to existing securityholders or employees of Holdco and
its subsidiaries on Form S-4 or Form S-8 (or any successor form).

 

10.           Assignment.
No party hereto may assign any obligations hereunder to any other party without
the prior written consent of the other parties (which consent shall not be
unreasonably withheld); provided, that BSMB may, without the consent of
the Company, assign its rights under this Agreement to any of its affiliates.

 

11.           No
Waiver. The failure of a party to this Agreement to insist upon strict adherence
to any term of this Agreement on any occasion shall not be considered a waiver
or deprive that party of the right thereafter to insist upon strict adherence
to that term or any other term of this Agreement. Any waiver must be in
writing.

 

12.           Successors.
This Agreement and all the obligations and benefits hereunder shall inure to
the successors and permitted assigns of the parties.

 

13.           Counterparts.
This Agreement may be executed and delivered by each party hereto in separate
counterparts, each of which when so executed and delivered shall be deemed an
original and all of which taken together shall constitute but one and the same
agreement.

 

14.           Entire
Agreement; Modification; Governing Law. The terms and conditions hereof
constitute the entire agreement between the parties hereto with respect to the
subject matter of this Agreement and supersede all previous communications,
either oral or written, representations or warranties of any kind whatsoever,
except as expressly set forth herein. No modifications of this Agreement nor
waiver of the terms or conditions thereof shall be binding upon either party
unless approved in writing by an authorized representative of such party. All
issues concerning this agreement shall be governed by and construed in accordance
with the laws of the State of New York without giving effect to any choice of
law or conflict of law provision or rule (whether of the State of New York or
any other jurisdiction) that would cause the application of the law of any
jurisdiction other than the State of New York.

 

6

 

15.           WAIVER
OF JURY TRIAL. EACH PARTY TO THIS AGREEMENT HEREBY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND,
ACTION, OR CAUSE OF ACTION (A) ARISING UNDER THIS AGREEMENT OR (B) IN
ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES
HERETO IN RESPECT OF THIS AGREEMENT OR ANY OF THE TRANSACTIONS RELATED HERETO,
IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER IN
CONTRACT, TORT, EQUITY, OR OTHERWISE. EACH PARTY TO THIS AGREEMENT HEREBY
AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION, OR CAUSE OF ACTION
SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT THE PARTIES TO THIS
AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS AGREEMENT WITH ANY
COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF
THEIR RIGHT TO TRIAL BY JURY.

 

*    *   
*    *    *   
*

 

7

 

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

 

 

	
   

  	
  UNIVERSAL
  HOSPITAL SERVICES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Gary Blackford

  
	
   

  	
   

  	
  Name:
  Gary Blackford

  
	
   

  	
   

  	
  Title:
  Chief Executive Officer & President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BEAR
  STEARNS MERCHANT MANAGER

  
	
   

  	
  III
  (CAYMAN), L.P.

  
	
   

  	
   

  
	
   

  	
  By:
  JDH Management LLC, its general partner

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Robert Juneja

  
	
   

  	
   

  	
  Name:
  Robert Juneja

  
	
   

  	
   

  	
  Title:
  Managing Director

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