Exhibit 4.6
FORM OF SALE PARTICIPATION AGREEMENT
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__________________, ______
To: The Person whose name
and address are set forth
on the signature page hereof
Dear Sir or Madam:
You have entered into a Management Stockholder's Agreement, dated as of
____________ __, _______(the "Stockholder's Agreement") with ▇▇▇▇▇▇ Chemical,
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Inc., a New Jersey corporation (the "Company"), relating to the purchase by you
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from the Company of shares of common stock, par value $.01 per share (the
"Common Stock"), of the Company. In connection therewith, ▇▇▇▇▇▇ Holdings,
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Inc. and certain of its affiliates who own Common Stock (collectively, the
"Parents") hereby agree with you as follows, effective upon your purchase of
Common Stock:
1. In the event that at any time either of the Parents proposes to sell
for cash or any other consideration any shares of Common Stock of the Company
owned by it, in any transaction other than a Public Offering (as defined in the
Stockholder's Agreement) or a sale to an affiliate of KKR Associates, such
Parent will notify you or your Purchaser's Estate or Purchaser's Trust (as such
terms are defined in Section 2 of the Stockholder's Agreement), as the case may
be, in writing (a "Notice") of such proposed sale (a "Proposed Sale") and the
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material terms of the Proposed Sale as of the date of the Notice (the "Material
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Terms") promptly, and in any event not less than 15 days prior to the
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consummation of the Proposed Sale and not more than 5 days after the execution
of the definitive agreement relating to the Proposed Sale, if any (the "Sale
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Agreement"). If within 10 days of your or your Purchaser's Estate's or
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Purchaser's Trust's, as the case may be, receipt of such Notice such Parent
receives from you or your Purchaser's Estate or Purchaser's Trust, as the case
may be, a written request (a "Purchaser Request") to include Common Stock held
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by you or your Purchaser's Estate or Purchaser's Trust, as the case may be, in
the Proposed Sale (which Purchaser Request shall be irrevocable unless (a) there
shall be a material adverse change in the Material Terms or (b) otherwise
mutually agreed to in writing by you or your Purchaser's Estate or Purchaser's
Trust, as the case may be, and such Parent), the Common Stock held by you will
be so included as provided herein; provided that only one Purchaser Request,
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which shall be executed by you or your Purchaser's Estate or Purchaser's Trust,
as the case may be, may be delivered with respect to any Proposed Sale for all
Common Stock held by you or your Purchaser's Estate or Purchaser's Trust.
Promptly after the consummation of the transactions contemplated thereby, such
Parent will furnish you, your Purchaser's Trust or your Purchaser's Estate, as
the case may be, with a copy of the Sale Agreement, if any.
2. The number of shares of Common Stock which you or your Purchaser's
Estate or Purchaser's Trust, as the case may be, will be permitted to include in
a Proposed Sale pursuant to a Purchaser Request will be the lesser of (a) the
sum of the number of shares of Common Stock then owned by you or your
Purchaser's Estate or Purchaser's Trust, as the case may be, plus all shares of
Common Stock which you are then entitled to acquire under an unexercised option
to purchase shares of Common Stock, to the extent such option is then vested or
would become vested as a result of the consummation of the Proposed Sale and (b)
the sum of the shares of Common Stock then owned by you or your Purchaser's
Estate or Purchaser's Trust, as the case may be, plus all shares of Common Stock
which you are entitled to acquire under an unexercised option to purchase shares
of Common Stock, whether or not fully vested, multiplied by a percentage
calculated by dividing the aggregate number of shares of Common Stock which the
Parents propose to sell in the Proposed Sale by the total number of shares of
Common Stock owned by the Parents. If one or more holders of shares of Common
Stock who have been granted the same rights granted to you or your Purchaser's
Estate or Purchaser's Trust, as the case may be, hereunder elect not to include
the maximum number of shares of Common Stock which such holders would have been
permitted to include in a Proposed Sale (the "Eligible Shares"), the Parents or
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such remaining holders of shares of Common Stock, or any of them, may sell in
the Proposed Sale a number of additional shares of Common Stock owned by any of
them equal to their pro rata portion of the number of Eligible Shares not
included in the Proposed Sale, based on the relative number of shares of Common
Stock then held by each such holder, and such additional shares of Common Stock
which any such holder or holders propose to sell shall not be included in any
calculation made pursuant to this Paragraph 2 for the purpose of determining the
number of shares of Common Stock which you or your Purchaser's Estate or
Purchaser's Trust, as the case may be, will be permitted to include in a
Proposed Sale. The Parents may sell in the Proposed Sale additional shares of
Common Stock owned by it equal to any remaining Eligible Shares which will not
be included in the Proposed Sale pursuant to the foregoing.
3. If any of the Parents receives an offer from a person to purchase in
a Proposed Sale (a) at least a majority of the shares of Common Stock then
outstanding or (b) all or substantially all of the shares of Common Stock owned
by such Parent, and such offer is accepted by such Parent, then each of you,
your Purchaser's Estate and your Purchaser's Trust hereby agrees that, if
requested by any Parent ("Parent Request"), you, your Purchaser's Estate and
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your Purchaser's Trust will sell in such Proposed Sale on the same terms and
conditions (including, without limitation, time of payment and form of
consideration) as to be paid and given to such Parent, the number of shares of
Common Stock equal to the number of shares of Common Stock owned by you, your
Purchaser's Estate and your Purchaser's Trust (plus all shares of Common Stock
which you are then entitled to acquire under an unexercised option to purchase
shares of Common Stock, to the extent such option is then vested or would become
vested as a result of the consummation of the Proposed Sale) multiplied by (x)
in the case of a Proposed Sale described in clause (a) above, the percentage of
the then outstanding shares of Common Stock to which the Proposed Sale is
applicable or (y) in the case of a Proposed Sale described in clause (b) above,
the percentage of the shares of Common Stock owned by such Parent to which the
Proposed Sale is applicable.
4. (a) Except as may otherwise be provided herein, shares of Common
Stock subject to a Purchaser Request or a Parent Request will be included in a
Proposed Sale pursuant hereto and in any agreements with purchasers relating
thereto on the same terms and subject to the same conditions applicable to the
shares of Common Stock which such Parent proposes to sell in the Proposed Sale.
Such terms and conditions shall include, without limitation: the sales price;
the payment of fees, commissions, adjustments to purchase price and expenses;
the provision of, and representation and warranty as to, information requested
by such Parent; and the provision of requisite indemnifications; provided that
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any fees, commissions, adjustments to purchase price, expenses or
indemnification provided by you, your Purchaser's Estate or your Purchaser's
Trust shall be on a pro rata basis in proportion with the number of shares of
Common Stock to be sold.
(b) In the event of a transaction (such as a merger or
consolidation) involving the Company which results in a Change of Control (as
defined in Section 15 of the Stockholder's Agreement) but is not a Proposed Sale
(a "Proposed Transaction"), you agree on behalf of yourself, your Purchaser's
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Estate and your Purchaser's Trust to bear your pro rata share of any fees,
commissions, adjustments to purchase price, expenses or indemnities borne by the
Parent.
(c) Your pro rata share of any amount pursuant to Paragraphs 4(a)
or (b) shall be based upon the number of shares of Common Stock owned by
you, your Purchaser's Estate and your Purchaser's Trust plus the number of
shares of Common Stock you would have the right to acquire under unexercised
options which are then vested or would become vested as a result of the Proposed
Sale or Proposed Transaction.
(d) The Parents shall be entitled to estimate the amount of
fees, commissions, adjustments to purchase price, expenses or indemnities in
connection with any Proposed Sale or Proposed Transaction and to withhold such
amounts from payments to be made to you, your Purchaser's Estate and your
Purchaser's Trust at the time of closing of such Proposed Sale or Proposed
Transaction; provided that, (i) such estimate shall not preclude the Parents
from recovering additional amounts from you, your Purchaser's Estate and your
Purchaser's Trust in respect of such fees, commissions, adjustments to purchase
price, expenses or indemnities and (ii) the Parents shall reimburse you, your
Purchaser's Estate and your Purchaser's Trust to the extent actual amounts are
ultimately less than the estimated amounts.
5. Upon delivering a Purchaser Request or receiving a Parent Request,
you or your Purchaser's Estate or Purchaser's Trust, as the case may be, will,
if requested by any of the Parents, execute and deliver a custody agreement and
power of attorney in form and substance satisfactory to such Parent with respect
to the shares of Common Stock which are to be sold by you or your Purchaser's
Estate or Purchaser's Trust, as the case may be, pursuant hereto (a "Custody
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Agreement and Power of Attorney"). The Custody Agreement and Power of Attorney
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will provide, among other things, that you or your Purchaser's Estate or
Purchaser's Trust, as the case may be, will deliver to and deposit in custody
with the custodian and attorney-in-fact named therein a certificate or
certificates representing such shares of Common Stock (duly endorsed in blank by
the registered owner or owners thereof) and irrevocably appoint said custodian
and attorney-in-fact as your or your Purchaser's Estate's or Purchaser's
Trust's, as the case may be, agent and attorney-in-fact with full power and
authority to act under the Custody Agreement and Power of Attorney on your or
your Purchaser's Estate's or Purchaser's Trust's, as the case may be, behalf
with respect to the matters specified therein.
6. Your or your Purchaser's Estate's or Purchaser's Trust's, as the
case may be, right pursuant hereto to participate in a Proposed Sale shall be
contingent on your or your Purchaser's Estate's or Purchaser's Trust's, as the
case may be, strict compliance with each of the provisions hereof and your or
your Purchaser's Estate's or Purchaser's Trust's, as the case may be,
willingness to execute such documents in connection therewith as may be
reasonably requested by such Parent.
7. The obligations of the Parents hereunder shall extend only to you or
your Purchaser's Estate or Purchaser's Trust, as the case may be, and no other
of your or your Purchaser's Estate's or Purchaser's Trust's, as the case may be,
successors or assigns shall have any rights pursuant hereto.
8. This Agreement shall terminate and be of no further force and effect
on the fifth anniversary of the first occurrence of a Public Offering (as
defined in the Stockholder's Agreement).
9. All notices and other communications provided for herein shall be in
writing and shall be deemed to have been duly given when delivered to the party
to whom it is directed:
If to ▇▇▇▇▇▇ Holdings, Inc. or BDS Two, Inc., to them at the following
address:
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
with copies to:
Kohlberg Kravis ▇▇▇▇▇▇▇ & Co.
▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇, ▇▇.
-and-
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
If to you, to you at the address set forth on the signature page hereof;
If to your Purchaser's Estate or Purchaser's Trust, at the address
provided to the Company by such entity;
or at such other address as any of the above shall have specified by notice in
writing delivered to the others by certified mail.
10. THE LAWS OF THE STATE OF NEW JERSEY SHALL GOVERN THE
INTERPRETATION, VALIDITY AND PERFORMANCE OF THE TERMS OF THIS AGREEMENT,
REGARDLESS OF THE LAW THAT MIGHT BE APPLIED UNDER PRINCIPLES OF CONFLICTS OF
LAW. ANY SUIT, ACTION OR PROCEEDING AGAINST YOU WITH RESPECT TO THIS AGREEMENT,
OR ANY JUDGMENT ENTERED BY ANY COURT IN RESPECT OF ANY THEREOF, MAY BE BROUGHT
IN ANY COURT OF COMPETENT JURISDICTION IN THE STATE OF NEW JERSEY OR NEW YORK,
AS THE PARENTS MAY ELECT IN ITS SOLE DISCRETION, AND YOU HEREBY SUBMIT TO THE
NON-EXCLUSIVE JURISDICTION OF SUCH COURTS FOR THE PURPOSE OF ANY SUCH SUIT,
ACTION, PROCEEDING OR JUDGMENT. YOU HEREBY IRREVOCABLY WAIVE ANY OBJECTIONS
WHICH YOU MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUIT,
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT BROUGHT IN ANY
COURT OF COMPETENT JURISDICTION IN THE STATE OF NEW JERSEY OR NEW YORK, AND
HEREBY FURTHER IRREVOCABLY WAIVE ANY CLAIM THAT ANY SUCH SUIT, ACTION OR
PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN ANY INCONVENIENT FORUM.
NO SUIT, ACTION OR PROCEEDING AGAINST ANY OF THE PARENTS WITH RESPECT TO THIS
AGREEMENT MAY BE BROUGHT IN ANY COURT, DOMESTIC OR FOREIGN, OR BEFORE ANY
SIMILAR DOMESTIC OR FOREIGN AUTHORITY OTHER THAN IN A COURT OF COMPETENT
JURISDICTION IN THE STATE OF NEW JERSEY OR NEW YORK, AND YOU HEREBY IRREVOCABLY
WAIVE ANY RIGHT WHICH YOU MAY OTHERWISE HAVE HAD TO BRING SUCH AN ACTION IN ANY
OTHER COURT, DOMESTIC OR FOREIGN, OR BEFORE ANY SIMILAR DOMESTIC OR FOREIGN
AUTHORITY. THE PARENTS HEREBY SUBMIT TO THE JURISDICTION OF SUCH COURTS FOR THE
PURPOSE OF ANY SUCH SUIT, ACTION OR PROCEEDING.
11. If any of the Parents transfers its interest in the
Company to an affiliate of such Parent, such affiliate shall succeed to all of
such Parent's rights and obligations hereunder. Upon any merger or
consolidation of any of the Parents with the Company or any liquidation of any
of the Parents, the stockholder or stockholders of such Parent shall succeed to
all of such Parent's rights and obligations hereunder.
12. It is the understanding of the undersigned that you are aware that
no Proposed Sale or Proposed Transaction presently is contemplated and that such
a transaction may never occur.
This Agreement may be signed in counterparts, each of which shall be an
original, with the same effect as if the signatures thereto and hereto were upon
the same instrument.
If the foregoing accurately sets forth our agreement, please acknowledge
your acceptance thereof in the space provided below for that purpose.
Very truly yours,
▇▇▇▇▇▇ HOLDINGS, INC.
By---------------------------
Name:
Title:
BDS TWO, INC.
By---------------------------
Name:
Title:
Accepted and agreed to:
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(Signature)
Address:
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