-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, RPgRtChAtiooih7E/+pNO+zWjLgRwgV5qizC9RgEyOQ0cF/y8wNTJA4f6Keyu/rS 2zAv8dBHh/7zsQE8aa0hzw== 0001341004-06-003132.txt : 20061124 0001341004-06-003132.hdr.sgml : 20061123 20061124132435 ACCESSION NUMBER: 0001341004-06-003132 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 3 FILED AS OF DATE: 20061124 DATE AS OF CHANGE: 20061124 GROUP MEMBERS: CREDIT SUISSE (BERMUDA) LIMITED GROUP MEMBERS: CREDIT SUISSE FIRST BOSTON EQUITY PARTNERS, (BERMUDA), L.P. GROUP MEMBERS: CREDIT SUISSE FIRST BOSTON EQUITY PARTNERS, L.P. GROUP MEMBERS: CREDIT SUISSE FIRST BOSTON U.S. EXECUTIVE ADVISORS, L.P. GROUP MEMBERS: CREDIT SUISSE INVESTMENT ADVISORY PARTNERS, LLC GROUP MEMBERS: EMA PARTNERS FUND 2000, L.P. GROUP MEMBERS: EMA PRIVATE EQUITY FUND 2000, L.P. GROUP MEMBERS: HEMISPHERE PRIVATE EQUITY PARTNERS, LTD. SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: METALDYNE CORP CENTRAL INDEX KEY: 0000745448 STANDARD INDUSTRIAL CLASSIFICATION: MOTOR VEHICLE PARTS & ACCESSORIES [3714] IRS NUMBER: 382513957 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-35355 FILM NUMBER: 061237916 BUSINESS ADDRESS: STREET 1: 47659 HALYARD DRIVE CITY: PLYMOUTH STATE: MI ZIP: 48170 BUSINESS PHONE: 734-207-6200 MAIL ADDRESS: STREET 1: 47659 HALYARD DRIVE CITY: PLYMOUTH STATE: MI ZIP: 48170 FORMER COMPANY: FORMER CONFORMED NAME: MASCOTECH INC DATE OF NAME CHANGE: 19930629 FORMER COMPANY: FORMER CONFORMED NAME: MASCO INDUSTRIES INC DATE OF NAME CHANGE: 19930629 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: CREDIT SUISSE/ CENTRAL INDEX KEY: 0000824468 IRS NUMBER: 000000000 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: PO BOX 900 STREET 2: FHLS CITY: ZURICH STATE: V8 ZIP: CH 8070 BUSINESS PHONE: 41 1 212 16 16 MAIL ADDRESS: STREET 1: PO BOX 900 CITY: ZURICH STATE: V8 ZIP: CH 8070 FORMER COMPANY: FORMER CONFORMED NAME: CREDIT SUISSE FIRST BOSTON/ DATE OF NAME CHANGE: 19970211 FORMER COMPANY: FORMER CONFORMED NAME: CREDIT SUISSE DATE OF NAME CHANGE: 19921119 SC 13D/A 1 nyc681186.txt SCHEDULE 13D - AMENDMENT NO. 2 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 SCHEDULE 13D/A (Amendment No. 2) Under the Securities Exchange Act of 1934 METALDYNE CORPORATION - ------------------------------------------------------------------------------- (Name of Issuer) COMMON STOCK, PAR VALUE $1.00 PER SHARE - ------------------------------------------------------------------------------- (Title of Class of Securities) 574670105 - ------------------------------------------------------------------------------- (CUSIP Number) Credit Suisse First Boston Equity Partners, L.P. Credit Suisse First Boston Equity Partners (Bermuda), L.P. Credit Suisse First Boston U.S. Executive Advisors, L.P. EMA Partners Fund 2000, L.P. EMA Private Equity Fund 2000, L.P. Credit Suisse (Bermuda) Limited Hemisphere Private Equity Partners, Ltd. Credit Suisse Investment Advisory Partners, LLC Credit Suisse (Name of Persons Filing Statement) Ivy B. Dodes Credit Suisse Eleven Madison Avenue New York, New York 10010 (212) 325-2000 -------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) August 31, 2006 ------------------------------------------------------------------------- (Date of Event Which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of sections 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. [ ] Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Section 240.13d-7 for other parties to whom copies are to be sent. * The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act") or otherwise subject to the liabilities of that section of the Exchange Act but shall be subject to all other provisions of the Exchange Act (however, see the Notes). - ------------------------------------------------------------------------------- 1. Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only) Credit Suisse First Boston Equity Partners, L.P. 13-3994124 - ------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) [ ] (b) [X] - ------------------------------------------------------------------------------- 3. SEC USE ONLY - ------------------------------------------------------------------------------- 4. Source of Funds (See Instructions) OO - ------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) [ ] - ------------------------------------------------------------------------------- 6. Citizenship or Place of Organization Delaware - ------------------------------------------------------------------------------- Number of 7. Sole Voting Power Shares Beneficially 7,402,831 shares of Common Stock, Owned by par value $1.00 Each ----------------------------------------- Reporting Person with 8. Shared Voting Power [0] ------------------------------------------ 9. Sole Dispositive Power 7,402,831 shares of Common Stock, par value $1.00 ------------------------------------------ 10. Shared Dispositive Power [0] - ------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each Reporting Person 7,402,831 shares of Common Stock, par value $1.00 - ------------------------------------------------------------------------------- 12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - ------------------------------------------------------------------------------- 13. Percent of Class Represented by Amount in Row (11) 17.64% - ------------------------------------------------------------------------------- 14. Type of Reporting Person (See Instructions) PN - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- 1. Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only) Credit Suisse First Boston Equity Partners, (Bermuda), L.P. 98-0191048 - ------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) [ ] (b) [X] - ------------------------------------------------------------------------------- 3. SEC USE ONLY - ------------------------------------------------------------------------------- 4. Source of Funds (See Instructions) OO - ------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) [ ] - ------------------------------------------------------------------------------- 6. Citizenship or Place of Organization Bermuda - ------------------------------------------------------------------------------- Number of 7. Sole Voting Power Shares Beneficially 2,069,282 shares of Common Stock, Owned by par value $1.00 Each ----------------------------------------- Reporting Person with 8. Shared Voting Power 0 ----------------------------------------- 9. Sole Dispositive Power 2,069,282 shares of Common Stock, par value $1.00 ----------------------------------------- 10. Shared Dispositive Power 0 - ------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each Reporting Person 2,069,282 shares of Common Stock, par value $1.00 - ------------------------------------------------------------------------------- 12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - ------------------------------------------------------------------------------- 13. Percent of Class Represented by Amount in Row (11) 4.93% - ------------------------------------------------------------------------------- 14. Type of Reporting Person (See Instructions) PN - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- 1. Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only) Credit Suisse First Boston U.S. Executive Advisors, L.P. 13-3751234 - ------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) [ ] (b) [X] - ------------------------------------------------------------------------------- 3. SEC USE ONLY - ------------------------------------------------------------------------------- 4. Source of Funds (See Instructions) OO - ------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) [ ] - ------------------------------------------------------------------------------- 6. Citizenship or Place of Organization Delaware - ------------------------------------------------------------------------------- Number of 7. Sole Voting Power Shares Beneficially 6,610 shares of Common Stock, Owned by par value $1.00 Each ----------------------------------------- Reporting Person with 8. Shared Voting Power ----------------------------------------- 9. Sole Dispositive Power 6,610 shares of Common Stock, par value $1.00 ----------------------------------------- 10. Shared Dispositive Power - ------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each Reporting Person 6,610 shares of Common Stock, par value $1.00. - ------------------------------------------------------------------------------- 12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - ------------------------------------------------------------------------------- 13. Percent of Class Represented by Amount in Row (11) Less than 1% - ------------------------------------------------------------------------------- 14. Type of Reporting Person (See Instructions) PN - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- 1. Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only) EMA Partners Fund 2000, L.P. 13-4126806 - ------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) [ ] (b) [X] - ------------------------------------------------------------------------------- 3. SEC USE ONLY - ------------------------------------------------------------------------------- 4. Source of Funds (See Instructions) OO - ------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) [ ] - ------------------------------------------------------------------------------- 6. Citizenship or Place of Organization Delaware - ------------------------------------------------------------------------------- Number of 7. Sole Voting Power Shares Beneficially 533,168 shares of Common Stock Owned by par value $1.00 Each ----------------------------------------- Reporting Person with 8. Shared Voting Power ----------------------------------------- 9. Sole Dispositive Power 533,168 shares of Common Stock par value $1.00 ----------------------------------------- 10. Shared Dispositive Power - ------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each Reporting Person 533,168 shares of Common Stock, par value $1.00. - ------------------------------------------------------------------------------- 12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - ------------------------------------------------------------------------------- 13. Percent of Class Represented by Amount in Row (11) 1.27% - ------------------------------------------------------------------------------- 14. Type of Reporting Person (See Instructions) PN - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- 1. Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only) EMA Private Equity Fund 2000, L.P. 13-4126805 - ------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) [ ] (b) [X] - ------------------------------------------------------------------------------- 3. SEC USE ONLY - ------------------------------------------------------------------------------- 4. Source of Funds (See Instructions) OO - ------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) [ ] - ------------------------------------------------------------------------------- 6. Citizenship or Place of Organization Delaware - ------------------------------------------------------------------------------- Number of 7. Sole Voting Power Shares Beneficially 343,139 shares of Common Stock, Owned by par value $1.00 Each ----------------------------------------- Reporting Person with 8. Shared Voting Power ----------------------------------------- 9. Sole Dispositive Power 343,139 shares of Common Stock, par value $1.00 ----------------------------------------- 10. Shared Dispositive Power - ------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each Reporting Person 343,139 shares of Common Stock, par value $1.00. - ------------------------------------------------------------------------------- 12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - ------------------------------------------------------------------------------- 13. Percent of Class Represented by Amount in Row (11) Less than 1% - ------------------------------------------------------------------------------- 14. Type of Reporting Person (See Instructions) PN - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- 1. Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only) Credit Suisse (Bermuda) Limited (98-0186105) 13-5015677 - ------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) [ ] (b) [X] - ------------------------------------------------------------------------------- 3. SEC USE ONLY - ------------------------------------------------------------------------------- 4. Source of Funds (See Instructions) Not Applicable - ------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) [ ] - ------------------------------------------------------------------------------- 6. Citizenship or Place of Organization Bermuda - ------------------------------------------------------------------------------- Number of 7. Sole Voting Power Shares Beneficially 0 Owned by ----------------------------------------- Each Reporting 8. Shared Voting Power Person with 876,307 shares of Common Stock par value $1.00 ----------------------------------------- 9. Sole Dispositive Power 0 ----------------------------------------- 10. Shared Dispositive Power 876,307 shares of Common Stock, par value $1.00 - ------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each Reporting Person 876,307 shares of Common Stock, par value $1.00. - ------------------------------------------------------------------------------- 12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - ------------------------------------------------------------------------------- 13. Percent of Class Represented by Amount in Row (11) 2% - ------------------------------------------------------------------------------- 14. Type of Reporting Person (See Instructions) CO - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- 1. Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only) Hemisphere Private Equity Partners, Ltd. - ------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) [ ] (b) [X] - ------------------------------------------------------------------------------- 3. SEC USE ONLY - ------------------------------------------------------------------------------- 4. Source of Funds (See Instructions) Not Applicable - ------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) [ ] - ------------------------------------------------------------------------------- 6. Citizenship or Place of Organization Bermuda - ------------------------------------------------------------------------------- Number of 7. Sole Voting Power Shares Beneficially 0 Owned by ----------------------------------------- Each Reporting 8. Shared Voting Power Person with 9,478,723 shares of Common Stock, par value $1.00 ----------------------------------------- 9. Sole Dispositive Power 0 ----------------------------------------- 10. Shared Dispositive Power 9,478,723 shares of Common Stock, par value $1.00 - ------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each Reporting Person 9,478,723 shares of Common Stock, par value $1.00. - ------------------------------------------------------------------------------- 12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - ------------------------------------------------------------------------------- 13. Percent of Class Represented by Amount in Row (11) 22.1% - ------------------------------------------------------------------------------- 14. Type of Reporting Person (See Instructions) CO - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- 1. Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only) Credit Suisse Investment Advisory Partners, LLC 13-3947082 - ------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) [ ] (b) [X] - ------------------------------------------------------------------------------- 3. SEC USE ONLY - ------------------------------------------------------------------------------- 4. Source of Funds (See Instructions) Not Applicable - ------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) [ ] - ------------------------------------------------------------------------------- 6. Citizenship or Place of Organization Delaware - ------------------------------------------------------------------------------- Number of 7. Sole Voting Power Shares Beneficially 0 Owned by ----------------------------------------- Each Reporting 8. Shared Voting Power Person with 10,355,030 shares of Common Stock, par value $1.00 ----------------------------------------- 9. Sole Dispositive Power 0 ----------------------------------------- 10. Shared Dispositive Power 10,355,030 shares of Common Stock, par value $1.00 - ------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each Reporting Person 10,355,030 shares of Common Stock, par value $1.00. - ------------------------------------------------------------------------------- 12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - ------------------------------------------------------------------------------- 13. Percent of Class Represented by Amount in Row (11) 24.1% - ------------------------------------------------------------------------------- 14. Type of Reporting Person (See Instructions) IA - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- 1. Names of Reporting Persons. I.R.S. Identification Nos. of above persons (entities only) Credit Suisse, on behalf of the Investment Banking Division (CH-0203923549) - ------------------------------------------------------------------------------- 2. Check the Appropriate Box if a Member of a Group (See Instructions) (a) [ ] (b) [X] - ------------------------------------------------------------------------------- 3. SEC USE ONLY - ------------------------------------------------------------------------------- 4. Source of Funds (See Instructions) Not Applicable - ------------------------------------------------------------------------------- 5. Check if Disclosure of Legal Proceedings Is Required Pursuant to Items 2(d) or 2(e) [X] - ------------------------------------------------------------------------------- 6. Citizenship or Place of Organization Switzerland - ------------------------------------------------------------------------------- Number of 7. Sole Voting Power Shares Beneficially 0 Owned by ----------------------------------------- Each Reporting 8. Shared Voting Power Person with 10,355,030 shares of Common Stock, par value $1.00 ----------------------------------------- 9. Sole Dispositive Power 0 ----------------------------------------- 10. Shared Dispositive Power 10,355,030 shares of Common Stock, par value $1.00 - ------------------------------------------------------------------------------- 11. Aggregate Amount Beneficially Owned by Each Reporting Person 10,355,030 shares of Common Stock, par value $1.00. - ------------------------------------------------------------------------------- 12. Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - ------------------------------------------------------------------------------- 13. Percent of Class Represented by Amount in Row (11) 24.1% - ------------------------------------------------------------------------------- 14. Type of Reporting Person (See Instructions) BK, HC, OO - ------------------------------------------------------------------------------- This statement on Schedule 13D/A (the "Statement") is being filed as Amendment No. 2 to the statement on Schedule 13D originally filed with the Securities and Exchange Commission on December 8, 2000 (the "Original Statement"), as amended by Amendment No. 1 to the Statement on Schedule 13D filed with the Securities and Exchange Commission on December 15, 2000 (the "First Amendment"). Capitalized terms used but not defined herein have the meaning set forth in the Original Statement or the First Amendment as applicable. Item 1. Security and Issuer Item 1 is hereby amended and restated as follows: The class of equity securities to which this Statement relates is the Common Stock, par value $1.00 per share (the "Common Stock") of Metaldyne Corporation (formerly MascoTech, Inc.), a Delaware corporation (the "Company"). The principal executive offices of the Company are located at 47659 Halyard Drive, Plymouth, Michigan 48170. The Schedule 13D was filed due to the acquisition (as described in Item 3 of Schedule 13D) of shares of Common Stock of the Company in connection with the recapitalization (the "Recapitalization") of the Company pursuant to the merger of Riverside Acquisition Corporation with and into the Company on November 28, 2000 in accordance with the terms of the Recapitalization Agreement, dated as of August 1, 2000, as amended, between MascoTech, Inc. and Riverside Acquisition Corporation. The Recapitalization, the Recapitalization Agreement and the transactions contemplated thereby are more fully described in MascTech's Statement on Schedule 13E-3 and Definitive Proxy Statement on Schedule 14A, each previously filed with the Securities and Exchange Commission (the "Commission") on October 26, 2000 and incorporated by reference into the Schedule 13D. The First Amendment to Schedule 13D was filed with the Commission on December 22, 2000 due to then recent acquisition (as described in Item 3 of Schedule 13D/A Amendment No.1) of additional shares of Common Stock of the Company in connection with the merger of a subsidiary of the Company and Simpson Industries, Inc., as described in Exhibit 99 of the Form 8-K dated December 15, 2000, filed with the Commission and incorporated by reference into the Schedule 13D/A Amendment No.1. This Amendment No. 2 is being filed due to the recent Agreement and Plan of Merger, dated as of August 31, 2006 by and among the Company, Asahi Tec Corporation, a Japanese corporation and Argon Acquisition Corp., a Delaware corporation, and the transactions comtemplated thereby. Item 2. Identity and Background. Item 2 is hereby amended and restated as follows: In accordance with Securities and Exchange Commission Release No. 34-39538 (January 12, 1998), this Statement is being filed by Credit Suisse (the "Bank"), a Swiss bank, on behalf of its subsidiaries to the extent that they constitute the Investment Banking division (the "Investment Banking division") (the "CS Reporting Person"). The CS Reporting Person provides financial advisory and capital raising services, sales and trading for users and suppliers of capital around the world and invests in and manages private equity and venture capital funds. The address of the Bank's principal business and office is Uetlibergstrasse 231, P.O. Box 900, CH 8070 Zurich, Switzerland. The address of the CS Reporting Person's principal business and office in the United States is Eleven Madison Avenue, New York, New York 10010. Credit Suisse First Boston Equity Partners (Bermuda), L.P., a Bermuda limited partnership ("CSFBEP Bermuda"), Credit Suisse First Boston Equity Partners, L.P., a Delaware limited partnership ("CSFBEP"), Credit Suisse First Boston U.S. Executive Advisors, L.P., a Delaware limited partnership ("CSUSEA"), EMA Partners Fund 2000, L.P., a Delaware limited partnership ("EMA Partners") and EMA Private Equity Fund 2000, L.P., a Delaware limited partnership ("EMA Private Equity") (collectively the "CS Funds"); are the holders of the shares of Common Stock reported herein. The principal business and office of each of the CS Funds and Credit Suisse Investment Advisory Partners, LLC, a Delaware limited liability company ("CS Advisory Partners"), is Eleven Madison Avenue, New York, New York 10010 and the address of Credit Suisse (Bermuda) Limited, a Bermuda corporation ("CS Bermuda"), is Thistle House, 4 Burnaby Street, Hamilton, HM 12 Bermuda. Pursuant to investment advisory agreements with CSFBEP Bermuda, CSFBEP and CSUSEA, CS Advisory Partners makes all investment decisions for those three CS Funds, including the decision to buy, sell or hold securities which comprise the assets of each of those three CS Funds. In addition, each of EMA Partners and EMA Private Equity must invest in and dispose of its portfolio securities pro rata and simultaneously with CSFBEP pursuant to its limited partnership agreement. Thus CS Advisory Partners may be deemed to be the beneficial owner of the shares of Common Stock owned by the CS Funds. CS Advisory Partners is a wholly-owned subsidiary of the Bank. The investment committee of CS Advisory Partners that oversees the investment decisions made for the CS Funds includes employees of the Asset Management division (as defined below) of the Bank. CS Bermuda is the general partner of each of EMA Partners and EMA Private Equity and thus manages and controls the affairs of EMA Partners and EMA Private Equity, which, unlike the other CS Funds, are not advised in their investment decisions by CS Advisory Partners. However, pursuant to their respective limited partnership agreements, each of EMA Partners and EMA Private Equity must invest in and dispose of its portfolio securities pro rata and simultaneously with CSFBEP. CS Bermuda is a wholly-owned subsidiary of the Bank. Hemisphere Private Equity Partners, Ltd., a Bermuda corporation ("Hemisphere") is the general partner of CSFBEP Bermuda, CSFBEP and CSUSEA and, other than the investment activities for which CS Advisory Partners is responsible, thus manages and controls the affairs of those three CS Funds. Hemisphere is engaged in the business of acting as general partner to collective investment vehicles organized as limited partnerships. Hemisphere's business address is Hemisphere House, Nine Church Street, Hamilton HM11, Bermuda. Credit Suisse Group, a corporation formed under the laws of the Canton of Zurich, Switzerland ("CSG") is a global financial services company, active in all major financial centers and providing a comprehensive range of banking and insurance products. CSG and its consolidated subsidiaries are comprised of the Bank and the Winterthur division (the "Winterthur division"). In addition to the Investment Banking division, the Bank is comprised of the Asset Management division (the "Asset Management division") and the Private Banking division (the "Private Banking division"). The Asset Management division provides asset management and investment advisory services to institutional, mutual fund and private investors worldwide. The Private Banking division offers global private banking and corporate and retail banking services in Switzerland. The Winterthur division provides life and non-life insurance and pension products to private and corporate clients worldwide. CSG's business address is Paradeplatz 8, P.O. Box 1, CH 8070 Zurich, Switzerland. CSG, for purposes of the federal securities laws, may be deemed ultimately to control the Bank and the CS Reporting Person. CSG, its executive officers and directors, and its direct and indirect subsidiaries (including those subsidiaries that constitute the Asset Management division, the Private Banking division and the Winterthur division) may beneficially own shares of Common Stock to which this Statement relates and such shares of Common Stock are not reported in this Statement. CSG disclaims beneficial ownership of shares of Common Stock beneficially owned by its direct and indirect subsidiaries, including the CS Reporting Person. Each of the Asset Management division, the Private Banking division and the Winterthur division disclaims beneficial ownership of shares of Common Stock beneficially owned by the CS Reporting Person. The CS Reporting Person disclaims beneficial ownership of shares of Common Stock beneficially owned by CSG, the Asset Management division, the Private Banking division and the Winterthur division. The Bank owns directly a majority of the voting stock, and all of the non-voting stock, of Credit Suisse Holdings (USA), Inc. ("CS Hldgs USA Inc"), a Delaware corporation. The address of CS Hldgs USA Inc's principal business and office is Eleven Madison Avenue, New York, New York 10010. The ultimate parent company of the Bank and CS Hldgs USA Inc, and the direct owner of the remainder of the voting stock of CS Hldgs USA Inc, is CSG. CS Hldgs USA Inc owns all of the voting stock of Credit Suisse (USA), Inc. ("CS USA Inc"), a Delaware corporation and holding company. CS USA Inc is the successor company of Credit Suisse First Boston (USA), Inc. ("CSFB-USA"), and all references hereinafter to CSFB-USA shall be deemed to refer to CS USA Inc. CS USA Inc is the sole member of Credit Suisse Securities (USA) LLC ("CS Sec USA LLC"), a Delaware limited liability company and a registered broker-dealer that effects trades in many companies. CS Sec USA LLC is the successor company of Credit Suisse First Boston LLC ("CSFB LLC"), which is the successor company of Credit Suisse First Boston Corporation ("CSFBC"), and all references hereinafter to CSFB LLC and CSFBC shall be deemed to refer to CS Sec USA LLC. The address of the principal business and office of each of CS USA Inc and CS Sec USA LLC is Eleven Madison Avenue, New York, New York 10010. The name, business address, citizenship, present principal occupation or employment, and the name and business address of any corporation or organization in which each such employment is conducted, of each executive officer or director of the CS Reporting Person, CS Hldgs USA Inc, CS USA Inc, CS Sec USA LLC, Hemisphere, CS Advisory Partners and CS Bermuda are set forth on Schedules A-1 through A-7 attached hereto, each of which is incorporated by reference herein. Except as otherwise provided herein, during the past five years none of the CS Reporting Person, CS Hldgs USA Inc, CS USA Inc, CS Sec USA LLC, Hemisphere, CS Advisory Partners, CS Bermuda, the CS Funds nor, to the best knowledge of the CS Reporting Person, any of the other persons listed on Schedules A-1 through A-7 attached hereto, has been (i) convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to United States federal or state securities laws or finding any violation with respect to such laws. On January 22, 2002, CSFBC, without admitting or denying any alleged violation, entered into coordinated settlements with NASD Regulation, Inc. ("NASDR") and and the Commission resolving all outstanding investigations of CSFBC into the allocation of shares in initial public offerings ("IPOs"). CSFB-USA was then the sole stockholder of CSFBC. CSFBC consented to these settlements without admitting or denying any of the allegations made in the Commission's Complaint or the Letter of Acceptance, Waiver and Consent ("AWC") filed with the NASDR. The Commission and NASDR alleged that, between April 1999 and June 2000, certain CSFBC employees allocated many shares in IPOs to over 100 customers with whom they had improper profit-sharing arrangements. The NASDR and the Commission alleged that certain employees allocated "hot" IPO shares to certain customers who paid the firm a portion of the profits (between 33 and 65%) that they made when they sold their IPO stock, by paying inflated brokerage commissions on transactions unrelated to the IPO shares. Under the terms of the coordinated settlement: o CSFBC paid a total of $100 million. This amount included $30 million in fines and civil penalties divided evenly between the Commission and NASDR, and a total of $70 million in disgorgement, $35 million of which was paid to the U.S. Treasury and $35 million of which was paid to the NASDR, representing the monies obtained as a result of the conduct described by the Commission and NASDR. The Commission determined in this case that it was appropriate and in the public interest to pay funds to the U.S. Treasury rather than to any third parties. o CSFBC has adopted and implemented revised policies and procedures for allocating IPOs in its broker-dealer operations. The Commission and NASD have reviewed these policies and procedures. These included the establishment of an IPO Allocation Review Committee, a process for the pre-qualification of accounts before they are eligible to receive IPO allocations and enhanced supervisory procedures, which includes the review of commissions paid by certain accounts receiving allocations around the time of the IPO. CSFBC also agreed to retain an independent consultant to review the implementation of these policies and procedures one year from the date of the settlement. In the NASDR settlement, CSFBC, without admitting or denying any findings, consented to a censure and findings that it violated NASD Rules 2110, 2330, 2710, 3010 and 3110. These Rules (a) require broker-dealers to adhere to just and equitable principles of trade, (b) prohibit broker-dealers from sharing in the profits of client accounts except as specifically provided, (c) require a managing underwriter to file certain information that may have a bearing on the NASDR's review of underwriting arrangements, (d) require members to establish, maintain and enforce a reasonable supervisory system and (e) require broker-dealers to maintain certain books and records. The NASDR AWC also found violations of Section 17(a) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and SEC Rule 17a-3, thereunder, which are incorporated by NASD Rule 3110 and similarly impose certain record keeping requirements on CSFBC as a broker-dealer. In the Commission settlement, CSFBC, without admitting or denying the allegations of the Complaint, consented to entry by the District Court for the District of Columbia of a final judgment that: (1) permanently enjoined CSFBC, directly or indirectly, from violations of NASD Conduct Rules 2110 and 2330 and Section 17(a)(1) of the Exchange Act and Commission Rule 17a-3; and (2) ordered CSFBC to comply with certain undertakings. Neither the Commission nor NASDR made any allegations or findings of fraudulent conduct by CSFBC. Further, neither the Commission nor NASDR alleged that any IPO prospectus was rendered false or misleading by CSFBC's conduct or that this conduct affected either the offering price of an IPO or the price at which any IPO stock traded in the aftermarket. On August 13, 2002, Mr. John A. Ehinger, an executive officer of CSFB-USA and board member of CSFB LLC, without admitting or denying any alleged violation, entered into a settlement with the NASD resolving outstanding investigations of Mr. Ehinger into his alleged failure to supervise with a view toward preventing CSFBC's violations of NASD Rules 2110, 2330, 2710 and 3110, and Section 17(a) of the Exchange Act and Commission Rule 17a-3 thereunder. Under the terms of the settlement, Mr. Ehinger agreed to (1) the payment of a fine of $200,000, (2) a suspension from associating with a member firm in any and all capacities for 30 calendar days and (3) a suspension from acting in any supervisory capacity for 30 additional calendar days, such supervisory suspension beginning after the suspension in all capacities had been served. On October 31, 2003, the U.S. District Court for the Southern District of New York (the "SDNY") approved the global settlement among a number of Wall Street firms, including CSFB LLC, and a coalition of state and federal regulators and self-regulatory organizations (the "Global Settlement"). CSFB LLC, without admitting or denying any alleged violation, consented to the Global Settlement and thereby resolved a Commission complaint filed on April 28, 2003, in the SDNY. In this complaint, the Commission alleged that, from July 1998 to December 2001, CSFB LLC engaged in acts and practices that created or maintained inappropriate influence over research analysts, thereby imposing conflicts of interest on research analysts that CSFB LLC failed to manage in an adequate or appropriate manner. The Commission's complaint also alleged that CSFB LLC engaged in inappropriate "spinning" of "hot" IPO allocations in violation of New York Stock Exchange ("NYSE") and NASD Inc. ("NASD") rules requiring adherence to high business standards and just and equitable principles of trade, and that CSFB LLC's books and records relating to certain transactions violated the broker-dealer record-keeping provisions of Section 17(a) of the Exchange Act, NYSE Rules 401, 440 and 476(a)(6) and NASD Rules 2110 and 3110. Under the terms of the Global Settlement: o CSFB LLC agreed to pay the following amounts: $75 million as a penalty, $75 million as disgorgement of commissions and other monies for restitution for investors, and $50 million to be used to fund independent research. This $50 million to fund independent research is payable over a five year period. o CSFB LLC is required, among other things, to: (i) separate its research and investment banking departments and make independent research available to investors, (ii) prohibit its analysts from receiving compensation for investment banking activities and prohibit analysts' involvement in investment banking "pitches" and "roadshows," (iii) contract, for a five-year period, with no fewer than three independent research firms that will make available independent research to CSFB LLC's customers and (iv) make its analysts' historical price targets (among other things) publicly available. o CSFB LLC is permanently restrained and enjoined from violating Sections 15(e) and 17(a) of the Exchange Act, Exchange Act Rules 15c1-2 and 17a-3, NASD Rules 2110, 2210, 3010, and 3110, and NYSE Rules 342, 401, 440, 472, and 476. Other Wall Street firms were subject to similar requirements. Item 4. Purpose of the Transaction. Item 4 is hereby amended by adding the following: (a) Agreement and Plan of Merger The Company previously announced that it has entered into an Agreement and Plan of Merger, dated as of August 31, 2006 (the "Merger Agreement") by and among Metaldyne, Asahi Tec Corporation, a Japanese corporation ("Asahi Tec") and Argon Acquisition Corp., a Delaware corporation and a wholly owned subsidiary of Asahi Tec ("Acquisition Sub"), pursuant to which Acquisition Sub will merge into Metaldyne (the "Merger"). Metaldyne, as the surviving corporation of the Merger, will become a wholly owned subsidiary of Asahi Tec and will cease to be a Reporting Company under the Securities and Exchange Act of 1934. The CS Funds and certain other stockholders approved the Merger and the CS Funds have submitted written consents to approve the Merger. The Company has announced that the necessary stockholder approval for the Merger has been obtained. Under the terms of the current Merger Agreement, at the effective time of the Merger, each share of Common Stock owned by those of the Company's common stockholders that are currently party to a Metaldyne shareholders agreement (defined for these purposes as, the "Principal Company Stockholders"), to which the CS Funds are a party, will be converted into the right to receive $2.1833 in cash, without interest. Each share of Common Stock held by persons that are not Principal Company Stockholders, (the "3% Minority Stockholders") (other than shares owned by Asahi Tec, Acquisition Sub, Metaldyne or any of their respective subsidiaries and shares ("Dissenting Shares") as to which Common Stockholders have perfected and not withdrawn the right to appraisal under Section 262 of the General Corporation Law of the State of Delaware (the "DGCL"), will be converted into the right to receive $2.40, without interest. Holders of these shares will receive a higher price per share if the average closing common price of the Asahi Tec common for a 30 trading day period prior to closing of the Merger, (the "Closing Common Price"), is higher than $1.9282 (the "Signing Common Price"), as determined under the Merger Agreement. In addition, in the event that any cash payment will be due as a result of the Merger on any stock options of the Company outstanding prior to the Merger, the total cash merger consideration for Common Stockholders, including the CS Funds party to the above referenced shareholders agreement, will be correspondingly reduced. The Principal Company Stockholders have been required by Asahi Tec, and have agreed, pursuant to a stock purchase agreement (a form of which is filed herewith at Exhibit (A) to Item 7), as such agreement may be amended, or modified (the "Stock Purchase Agreement") to reinvest their Merger proceeds in common stock of Asahi Tec in a private placement. In addition, all holders of the Company's preferred stock (the "Preferred Stockholders") have been required by Asahi Tec, and have agreed, to reinvest their Merger proceeds in Asahi Tec convertible preferred stock or common stock of Asahi Tec to be issued in a private placement. The Principal Company Stockholders and the Preferred Stockholders have agreed to waive their appraisal rights under the DGCL with respect to the Merger. Separately, the Board of Directors of the Company declared a distribution of all the common stock and common stock equivalents of TriMas Corporation that are owned by the Company to the Common Stockholders of record on the business day immediately prior to the Merger, subject to the closing of the Merger and certain other conditions. The Company announced that the terms of the Merger Agreement and Stock Purchase Agreement are currently being re-negotiated by the Company and Asahi-Tec (none of the CS Funds are party to that negotiation). Therefore, the terms of the Merger Agreement above are likely to change as a result of these discussions. For additional information with respect to the status of discussions related to the noteholder consents and waivers and events that have occurred subsequent to the Initial Filings, see the Company's Form 8-K filed with the Commission on November 15, 2006. The obligation of the parties to consummate the Merger and the related transactions are subject to the satisfaction of certain conditions, including: obtaining certain consents and waivers from holders of Metaldyne's 11% Notes, Senior Notes and 10% Notes (as such terms are defined below and as further described in Item 4(c) hereof); obtaining financing necessary to consummate the Merger and related transactions; closing of the private placements of Asahi Tec equity securities to the Principal Company Stockholders and Preferred Stockholders (in each case without the amendment, modification or waiver in any material respect of any material term or condition thereof); the absence of a material adverse effect on the Company; and U.S., Japanese and other foreign regulatory approval. In connection with the Merger, a shareholders' agreement was entered into as of August 31, 2006 by and among Asahi Tec, RHJ International SA and the Principal Company Stockholders setting forth certain rights and obligations of the parties in respect of Asahi Tec following the Merger. It is currently anticipated that the CS Funds will have the right to nominate a director to the board of Asahi Tec. The shareholders' agreement will become effective upon consummation of the Merger and the other transactions described in the Merger Agreement and in the Stock Purchase Agreement. (b) Stock Purchase Agreement The Principal Company Stockholders entered into the Stock Purchase Agreement pursuant to which the Principal Company Stockholders have agreed to reinvest their Merger proceeds in common stock of Asahi Tec in a private placement. In addition, the Preferred Stockholders have entered into preferred stock purchase agreements, pursuant to which such holders of the Company's preferred stock have agreed to reinvest their proceeds in Asahi Tec convertible preferred stock in a private placement. The price at which the Principal Company Stockholders and the Preferred Stockholders will purchase Asahi Tec common stock in the private placements is based on a discount to the Signing Common Price. This discount reflects the lesser per share merger consideration to be received by the Principal Company Stockholders relative to the 3% Minority Stockholders (without regard to any potential increase payable to the 3% Minority Stockholders as a result of improvements in the Closing Common Price relative to the Signing Common Price). (c) Noteholder Consents and Waivers The obligations of Metaldyne and Asahi Tec to close the Merger under the Merger Agreement are subject to obtaining consents and waivers from holders of its 11% senior subordinated notes due 2012 (the "11% Notes"), its 10% senior notes due 2013 (the "Senior Notes") and its 10% senior subordinated notes due 2014 (the "10% Notes") and the related indentures (including a waiver of the notes' change of control put provisions) to the Merger and related transactions. Subsequent to the announcement of the Merger, Metaldyne and Asahi Tec entered into discussions with noteholders to consider a range of alternatives in order to obtain the consents and waivers from these noteholders due to changed conditions in the bank market and the automotive industry and trading levels in the Metaldyne notes. The Company has also announced that all of the 10% Notes are currently held by DaimlerChrysler Corporation, which has consented to the required changes to its notes. Item 5. Interest in Securities of the Issuer. Item 5 is hereby amended and restated as the follows: (a) The CS Funds have acquired and, for the purpose of Rule 13d-3 promulgated under the Exchange Act, beneficially own, 10,355,030 shares of Common Stock, representing approximately 24.1% of the outstanding shares of Common Stock as of November 24, 2006. The individual holdings of the CS Funds are as follows: (i) CSFBEP (Bermuda) - 2,069,282 shares of Common Stock, representing approximately 4.8% beneficial ownership of Common Stock; (ii) CSFBEP - 7,402,831 shares of Common Stock representing approximately 17.2% beneficial ownership of Common Stock; (iii) CSUSEA - 6,610 shares of Common Stock, representing less than 1% beneficial ownership of Common Stock; (iv) EMA Partners - 533,168 shares of Common Stock representing approximately 1.2% beneficial ownership of Common Stock; and (v) EMA Private Equity - 343,139 shares of Common Stock representing less than 1% of beneficial ownership of Common Stock. As described in Item 2, CS Advisory Partners may be deemed to beneficially own the 10,355,030 shares of Common Stock directly held by the CS Funds, representing approximately 24.1% beneficial ownership of Common Stock. As described in Item 2, CS (Bermuda) as the general partner of EMA Partners and EMA Private Equity may be deemed to be the beneficial owner of the 876,307 shares of Common Stock directly held by EMA Partners and EMA Private Equity, collectively, representing 2% beneficial ownership of Common Stock. As described in Item 2 of the Schedule 13D, the Investment Banking division by virtue of the Bank's 100% indirect ownership of CS Advisory Partners and indirect control of EMA Partners and EMA Private Equity, may be deemed to beneficially own 10,355,030 shares of Common Stock, representing approximately 24.1% beneficial ownership of Common Stock. Hemisphere, as the general partner of CSFBEP (Bermuda), CSFBEP, CSFBUSEA may be deemed to beneficially own the 9,478,723 shares of Common Stock directly held by those three Funds, representing approximately 22.1% beneficially ownership of Common Stock. The foregoing percentages are based on 42,795,963 shares of Common Stock of the Issuer outstanding on October 5, 2006. Except as set forth in Item 5(a), none of the Reporting Persons nor, to the best knowledge of any of the Reporting Persons, any persons named in Schedules A1-A7 hereto beneficially owns any shares of Common Stock. (b) The CS Funds have sole power to vote or dispose of 10,355,030 shares of Common Stock. These shares constitute approximately 24.1% of the voting power of the Issuer as of October 5, 2006. Hemisphere, as the general partner of CSFBEP (Bermuda), CSFBEP, CSFBUSEA may be deemed to beneficially own 9,478,723 shares of Common Stock held by those three funds. CS (Bermuda), as the general partner of EMA Partners and EMA Private Equity and the Investment Banking division by virtue of the Bank's indirect majority ownership of CS Bermuda, may be deemed to share voting power with each of EMA Partners and EMA Private Equity over the 533,168 and 343,139 shares of Common Stock held by each of EMA Partners and EMA Private Equity respectively. In addition, the Investment Banking division, by virtue of the Bank's 100% ownership of CS Advisory Partners, and CS Advisory Partners may be deemed to share the power to dispose or direct the disposition of 10,355,030 shares of Common Stock held by the CS Funds. Item 6. Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer. Item 6 is hereby supplementally amended by reference to the disclosures in Item 4 of this Statement. Item 7. Material to be Filed as Exhibits. Exhibit B Form of Stock Purchase Agreement, dated August 31, 2006, by and among the Principal Company Stockholders identified therein, Asahi Tec Corporation and RHJI SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth herein is true, complete and correct. CREDIT SUISSE FIRST BOSTON EQUITY PARTNERS, L.P. By: /s/ Kenneth Lohsen ------------------------------ Name: Kenneth Lohsen Title: Attorney-In-Fact CREDIT SUISSE FIRST BOSTON EQUITY PARTNERS (BERMUDA), L.P By: /s/ Kenneth Lohsen ------------------------------ Name: Kenneth Lohsen Title: Attorney-In-Fact EMA PARTNERS FUND 2000, L.P By: /s/ Kenneth Lohsen ------------------------------ Name: Kenneth Lohsen Title: Vice President EMA PRIVATE EQUITY FUND 2000, L.P By: /s/ Kenneth Lohsen ------------------------------ Name: Kenneth Lohsen Title: Vice President CREDIT SUISSE FIRST BOSTON U.S. EXECUTIVE ADVISORS, L.P. By: /s/ Kenneth Lohsen ------------------------------ Name: Kenneth Lohsen Title: Attorney-In-Fact CREDIT SUISSE INVESTMENT ADVISORY PARTNERS, LLC By: /s/ Kenneth Lohsen ------------------------------ Name: Kenneth Lohsen Title: Vice President CREDIT SUISSE acting solely on behalf of the Investment Banking division By: /s/ Ivy Dodes ------------------------------- Name: Ivy Dodes CREDIT SUISSE (BERMUDA) LIMITED. By: /s/ Kenneth Lohsen ------------------------------ Name: Kenneth Lohsen Title: Vice President HEMISPHERE PRIVATE EQUITY PARTNERS, LTD. By: /s/ Kenneth Lohsen ------------------------------ Name: Kenneth Lohsen Title: Attorney-In-Fact Dated: November 24, 2006 SCHEDULE A-1 EXECUTIVE OFFICERS AND DIRECTORS OF THE REPORTING PERSON The following sets forth the name, business address, present principal occupation and citizenship of each executive officer and director of the Reporting Person. The business address of the Reporting Person is Eleven Madison Avenue, New York, New York 10010.
Name Business Address Title Citizenship Brady W. Dougan Eleven Madison Avenue Chief Executive Officer of the Investment United States New York, NY 10010 Banking Division and Chairman of the USA Investment Banking Management Committee Robert Basso Eleven Madison Avenue Head of the Investment Banking Division Human United States New York, NY 10010 Resources USA Phillip Cushmaro Eleven Madison Avenue Head of the Investment Banking Division New York, NY 10010 Information Technology United States USA Tony Ehringer Eleven Madison Avenue Co-Head of Equities United States New York, NY 10010 USA Brian D. Finn Eleven Madison Avenue Head of Alternative Investments United States New York, NY 10010 USA Marc D. Granetz Eleven Madison Avenue Co-Head of Investment Banking Department United States New York, NY 10010 USA John S. Harrison Eleven Madison Avenue Head of Executive Office Administration United States New York, NY 10010 USA James P. Healy Eleven Madison Avenue Head of Fixed Income United States New York, NY 10010 USA James E. Kreitman One Cabot Square Co-Head of Equities United States London E14 4QJ, Great Britain Don H. Callahan Eleven Madison Avenue Head of Client Coverage Strategy United States New York, NY 10010 USA Neil Moskowitz Eleven Madison Avenue Investment Banking Division Chief Financial United States New York, NY 10010 Officer and Head of Investment Banking USA Support Adebayo O. Ogunlesi Eleven Madison Avenue Chief Client Officer Nigeria New York, NY 10010 USA Carlos Onis Eleven Madison Avenue Senior Finance Officer of the Investment United States New York, NY 10010 Banking Division USA Eric M. Varvel Eleven Madison Avenue Co-Head of the Investment Banking Division United States New York, NY 10010 USA Ken Weiner Eleven Madison Avenue Head of the Investment Banking Operational Risk United States New York, NY 10010 Management USA Lewis Wirshba Eleven Madison Avenue Chief Operating Officer, Americas Region United States New York, NY 10010 USA Mark Rufeh Eleven Madison Avenue Head of Strategy Implementation and Expense United States New York, NY 10010 Management USA
SCHEDULE A-2 EXECUTIVE OFFICERS AND DIRECTORS OF CREDIT SUISSE HOLDINGS (USA), INC. The following sets forth the name, business address, present principal occupation and citizenship of each executive officer and director of Credit Suisse Holdings (USA), Inc. The business address of Credit Suisse Holdings (USA), Inc. is Eleven Madison Avenue, New York, New York 10010, USA.
Name Business Address Title Citizenship Brady W. Dougan Eleven Madison Avenue President, Chief Executive Officer United States New York, NY 10010 and Board Member USA Neil Moskowitz Eleven Madison Avenue Managing Director and Board Member United States New York, NY 10010 USA D. Neil Radey One Madison Avenue Managing Director and General Counsel United States New York, NY 10010 USA Paul J. O'Keefe Eleven Madison Avenue Chief Financial Officer and Controller United States New York, NY 10010 USA Peter J. Feeney Eleven Madison Avenue Treasurer United States New York, NY 10010 USA Mark Rufeh Eleven Madison Avenue Head of Strategy Implementation and United States New York, NY 10010 Expense Management USA Robert C. O'Brien Eleven Madison Avenue Managing Director and Chief Credit Officer United States New York, NY 10010 USA Carlos Onis Eleven Madison Avenue Managing Director United States New York, NY 10010 USA D. Wilson Ervin Eleven Madison Avenue Managing Director United States New York, NY 10010 USA Lewis Wirshba Eleven Madison Avenue Managing Director United States New York, NY 10010 USA Eric M. Varvel Eleven Madison Avenue Managing Director United States New York, NY 10010 USA Gary Neuser Eleven Madison Avenue Managing Director United States New York, NY 10010 USA James P. Healy Eleven Madison Avenue Managing Director United States New York, NY 10010 USA Marc D. Granetz Eleven Madison Avenue Managing Director United States New York, NY 10010 USA Tony Ehringer Eleven Madison Avenue Managing Director United States New York, NY 10010 USA
SCHEDULE A-3 EXECUTIVE OFFICERS AND DIRECTORS OF CREDIT SUISSE (USA), INC. The following sets forth the name, business address, present principal occupation and citizenship of each executive officer and director of Credit Suisse (USA), Inc. The business address of Credit Suisse (USA), Inc. is Eleven Madison Avenue, New York, New York 10010, USA.
Name Business Address Title Citizenship Brady W. Dougan Eleven Madison Avenue President, Chief Executive Officer United States New York, NY 10010 and Board Member USA Neil Moskowitz Eleven Madison Avenue Managing Director and Board Member United States New York, NY 10010 USA D. Neil Radey One Madison Avenue Managing Director and General Counsel United States New York, NY 10010 USA David C. Fisher Eleven Madison Avenue Chief Financial and Accounting Officer United States New York, NY 10010 USA Peter J. Feeney Eleven Madison Avenue Managing Director and Treasurer United States New York, NY 10010 USA Lewis H. Wirshba Eleven Madison Avenue Managing Director and Board Member United States New York, NY 10010 USA Carlos Onis Eleven Madison Avenue Managing Director and Board Member United States New York, NY 10010 USA Kenneth Weiner Eleven Madison Avenue Managing Director and Board Member United States New York, NY 10010 USA Frank J. DeCongelio Eleven Madison Avenue Managing Director and Bank Account United States New York, NY 10010 Officer USA Tony Ehringer Eleven Madison Avenue Managing Director United States New York, NY 10010 USA D. Wilson Ervin Eleven Madison Avenue Managing Director United States New York, NY 10010 USA James P. Healy Eleven Madison Avenue Managing Director United States New York, NY 10010 USA Adebayo O. Ogunlesi Eleven Madison Avenue Managing Director Nigeria New York, NY 10010 USA Jeffrey J. Salzman Eleven Madison Avenue Managing Director United States New York, NY 10010 USA Paul J. O'Keefe Eleven Madison Avenue Chief Financial Officer and United States New York, NY 10010 Accounting Officer USA Robert C. O'Brien Eleven Madison Avenue Chief Credit Officer United States New York, NY 10010 USA Gary Gluck Eleven Madison Avenue Managing Director United States New York, NY 10010 USA Brian D. Finn Eleven Madison Avenue Managing Director United States New York, NY 10010 USA Marc D. Granetz Eleven Madison Avenue Managing Director United States New York, NY 10010 USA Andrew M. Hutcher Eleven Madison Avenue Managing Director United States New York, NY 10010 USA Grace J. Koo Eleven Madison Avenue Managing Director United States New York, NY 10010 USA Eric M. Varvel Eleven Madison Avenue Managing Director United States New York, NY 10010 USA Kenneth P. Weiner Eleven Madison Avenue Managing Director United States New York, NY 10010 USA Simon D. Yates Eleven Madison Avenue Managing Director United States New York, NY 10010 USA Andrew B. Federbusch Eleven Madison Avenue Managing Director United States New York, NY 10010 USA Luther L. Terry, Jr. Eleven Madison Avenue Managing Director United States New York, NY 10010 USA
SCHEDULE A-4 EXECUTIVE OFFICERS AND DIRECTORS OF CREDIT SUISSE SECURITIES (USA) LLC The following sets forth the name, business address, present principal occupation and citizenship of each executive officer and director of Credit Suisse Securities (USA) LLC. The business address of Credit Suisse Securities (USA) LLC is Eleven Madison Avenue, New York, New York 10010, USA.
Name Business Address Title Citizenship Brady W. Dougan Eleven Madison Avenue President, Chief Executive Officer United States New York, NY 10010 and Board Member USA John A. Ehinger Eleven Madison Avenue Board Member United States New York, NY 10010 USA James P. Healy Eleven Madison Avenue Board Member United States New York, NY 10010 USA D. Neil Radey Eleven Madison Avenue General Counsel and Managing Director United States New York, NY 10010 USA Paul J. O'Keefe Eleven Madison Avenue Chief Financial Officer United States New York, NY 10010 USA Gary Gluck Eleven Madison Avenue Treasurer United States New York, NY 10010 USA Bryan C. Fletcher Eleven Madison Avenue Managing Director and Bank Account Officer United States New York, NY 10010 USA Edward A. Poletti Eleven Madison Avenue Board Member and Senior Vice President United States New York, NY 10010 USA Nicole S. Arnaboldi Eleven Madison Avenue Board Member United States New York, NY 10010 USA Peter J. Feeney Eleven Madison Avenue Treasurer United States New York, NY 10010 USA Ivy B. Dodes Eleven Madison Avenue Board Member United States New York, NY 10010 USA Thomas Prevost Eleven Madison Avenue Director of Taxes United States New York, NY 10010 USA
SCHEDULE A-5 EXECUTIVE OFFICERS AND DIRECTORS OF CREDIT SUISSE INVESTMENT ADVISORY PARTNERS, LLC The following sets forth the name, business address, present principal occupation and citizenship of each executive officer and director of Credit Suisse Advisory Partners, LLC. The business address of Credit Suisse Advisory Partners, LLC is Eleven Madison Avenue, New York, New York 10010, USA.
Name Business Address Title Citizenship George R. Hornig Eleven Madison Avenue Chief Administrative and Financial Officer United States New York, NY 10010 USA Kenneth J. Lohsen Eleven Madison Avenue Vice President United States New York, NY 10010 USA Emidio Morizio Eleven Madison Avenue Chief Compliance Officer United States New York, NY 10010 USA Edward A. Johnson Eleven Madison Avenue Vice President United States New York, NY 10010 USA Steven C. Rattner Eleven Madison Avenue Managing Director United States New York, NY 10010 USA Joseph V. Fossella Eleven Madison Avenue Controller United States New York, NY 10010 USA Thomas Prevost Eleven Madison Avenue Director of Taxes United States New York, NY 10010 USA
SCHEDULE A-6 EXECUTIVE OFFICERS AND DIRECTORS OF CREDIT SUISSE (BERMUDA) LIMITED The following sets forth the name, business address, present principal occupation and citizenship of each executive officer and director of Credit Suisse (Bermuda) Limited. The business address of Credit Suisse (Bermuda) Limited is Eleven Madison Avenue, New York, New York 10010, USA.
Name Business Address Title Citizenship Nicole S. Arnaboldi Eleven Madison Avenue President United States New York, NY 10010 USA Kenneth J. Lohsen Eleven Madison Avenue Vice President United States New York, NY 10010 USA Emidio Morizio Eleven Madison Avenue Chief Compliance Officer United States New York, NY 10010 USA Edward S. Nadel Eleven Madison Avenue Vice President United States New York, NY 10010 USA Ivy B. Dodes Eleven Madison Avenue Vice President United States New York, NY 10010 USA John S. Ficarra Eleven Madison Avenue Vice President United States New York, NY 10010 USA Douglas Roseman Eleven Madison Avenue Deputy Director of Taxes United States New York, NY 10010 USA Albert A. Scarola Eleven Madison Avenue Deputy Director of Taxes United States New York, NY 10010 USA Thomas Prevost Eleven Madison Avenue Director of Taxes United States New York, NY 10010 USA
SCHEDULE A-7 EXECUTIVE OFFICERS AND DIRECTORS OF HEMISHPERE PRIVATE EQUITY PARTNERS, LTD The following sets forth the name, business address, present principal occupation and citizenship of each executive officer and director of Credit Suisse (Bermuda) Limited. The business address of Hemisphere Private Euqity Partners, Ltd. is Hemisphere House, Nine Church Street, Hamilton HM11, Bermuda.
Name Business Address Title Citizenship Stephen Caton 9 Church Street Director and Head of Bermudian British Hamilton HM 11 Operations Bermuda Bermuda Ronan Daly One George's Quay Plaza Director and President Irish George's Quay Dublin 2, Ireland Christine Perinchief 9 Church Street Vice President of Bermudian British Hamilton HM 11 Corporate Services Bermuda
EX-99 2 nyc684129.txt EXHIBIT A FORM OF STOCK PURCHASE AGREEMENT Dated as of August 31, 2006 Between Asahi Tec Corporation And The Purchasers listed on Schedule I hereto TABLE OF CONTENTS Page ---- ARTICLE I Purchase and Sale of Shares; Dollar/Yen Exchange SECTION 1.01. Purchase and Sale of the Shares................................2 SECTION 1.02. Dollar/Yen Exchange............................................2 ARTICLE II Closing SECTION 2.01. Closing........................................................3 SECTION 2.02. Transactions to Be Effected at the Closing.....................3 ARTICLE III Representations and Warranties of the Company SECTION 3.01. Organization, Standing and Power...............................4 SECTION 3.02. Company Subsidiaries; Equity Interests.........................4 SECTION 3.03. Capital Structure; the Shares..................................4 SECTION 3.04. Authority; Execution and Delivery; Enforceability..............6 SECTION 3.05. No Conflicts; Consents.........................................7 SECTION 3.06. SEL Documents; Undisclosed Liabilities.........................9 SECTION 3.07. Information Supplied..........................................10 SECTION 3.08. Absence of Certain Changes or Events..........................10 SECTION 3.09. Taxes.........................................................12 SECTION 3.10. Absence of Changes in Benefit Plans...........................13 SECTION 3.11. Benefit Plans.................................................14 SECTION 3.12. Litigation....................................................17 SECTION 3.13. Compliance with Applicable Laws...............................18 SECTION 3.14. Environmental Matters.........................................18 SECTION 3.15. Intellectual Property.........................................20 SECTION 3.16. Contracts; Debt Instruments...................................20 SECTION 3.17. Title to Real Properties......................................21 SECTION 3.18. Customers and Suppliers.......................................21 SECTION 3.19. Brokers; Schedule of Fees and Expenses........................22 SECTION 3.20. Financing.....................................................22 i ARTICLE IV Representations and Warranties of the Purchaser SECTION 4.01. Organization, Standing and Power..............................23 SECTION 4.02. Accredited Investor; Private Offering.........................23 SECTION 4.03. Authority; Execution and Delivery; Enforceability.............23 SECTION 4.04. No Conflicts; Consents........................................24 SECTION 4.05. Information Supplied..........................................25 SECTION 4.06. Brokers.......................................................25 ARTICLE V Covenants Relating to Conduct of Business SECTION 5.01. Conduct of Business...........................................25 SECTION 5.02. No Solicitation...............................................27 ARTICLE VI Additional Agreements SECTION 6.01. Preparation of Information Statement..........................28 SECTION 6.02. Access to Information; Confidentiality........................29 SECTION 6.03. Commercially Reasonable Efforts; Notification.................30 SECTION 6.04. Fees and Expenses.............................................31 SECTION 6.05. Public Announcements..........................................31 SECTION 6.06. Transfer Taxes................................................32 ARTICLE VII Conditions Precedent SECTION 7.01. Conditions to Each Party's Obligation To Effect The Acquisition.................................................32 SECTION 7.02. Conditions to Obligations of the Purchaser....................33 SECTION 7.03. Condition to Obligation of the Company........................34 ARTICLE VIII Termination, Amendment and Waiver SECTION 8.01. Termination...................................................35 SECTION 8.02. Effect of Termination.........................................36 SECTION 8.03. Amendment.....................................................36 SECTION 8.04. Extension; Waiver.............................................36 ii ARTICLE IX General Provisions SECTION 9.01. Nonsurvival of Representations and Warranties.................37 SECTION 9.02. Notices.......................................................37 SECTION 9.03. Definitions...................................................38 SECTION 9.04. Interpretation................................................39 SECTION 9.05. Severability..................................................39 SECTION 9.06. Counterparts..................................................40 SECTION 9.07. Entire Agreement; No Third-Party Beneficiaries................40 SECTION 9.08. Governing Law.................................................40 SECTION 9.09. Assignment....................................................40 SECTION 9.10. Enforcement...................................................40 SECTION 9.11. Agreement and Waiver of Certain Rights........................41 iii STOCK PURCHASE AGREEMENT dated as of August 31, 2006, between Asahi Tec Corporation, a Japanese corporation (the "Company") and the persons named on Schedule I hereto (collectively, the "Purchaser"). WHEREAS the Purchaser desires to subscribe for and purchase from the Company, and the Company desires to issue and sell to the Purchaser, 13,594,150 newly issued shares of common stock of the Company (the "Shares"); WHEREAS simultaneously with the execution and delivery of this Agreement and as a condition to the parties' willingness to enter into this Agreement, the Company, Argon Acquisition Corp., a Delaware corporation and a wholly owned subsidiary of the Company ("Acquisition Sub"), and Metaldyne Corporation, a Delaware corporation ("Mercury"), have entered into an agreement and plan of merger dated as of the date of this Agreement (the "Merger Agreement"), whereby Acquisition Sub will be merged with and into Mercury, with Mercury as the surviving corporation, and Mercury will become a wholly-owned subsidiary of the Company (the "Merger"); WHEREAS simultaneously with the execution and delivery of this Agreement and as a condition to the Purchaser's willingness to enter into this Agreement, RHJ International S.A. ("RHJI") has executed and delivered to the Purchasers' Representative (as defined in the Company Stock Purchase Agreement) a voting agreement (the "Company Voting Agreement") dated as of the date of this Agreement in the form attached hereto as Exhibit A; WHEREAS simultaneously with the execution and delivery of this Agreement and as a condition to the Purchaser's willingness to enter into this Agreement, RHJI and the Purchasers (as defined in the Company Stock Purchase Agreement) have entered into an agreement in the form attached hereto as Exhibit B (the "Stockholders Agreement") dated as of the date of this Agreement, to be effective as of the Closing, whereby the Purchasers and RHJI agree to certain matters with respect to the Company; WHEREAS simultaneously with the execution and delivery of this Agreement and as a condition to the Purchaser's willingness to enter into this Agreement, the Company and each of the holders of (i) the Series A Mercury Preferred Stock and (ii) the Series A-1 Mercury Preferred Stock (together, the "Mercury Preferred Stock") have entered into an agreement (each, an "Other Stock Purchase Agreement") dated as of the date of this Agreement whereby holders of the Mercury Preferred Stock shall acquire for cash newly issued shares of convertible preferred stock of the Company (the "Company Class C Preferred Stock") using the Merger Consideration (as defined in the Merger Agreement) received by such holders as consideration for such preferred stock (each, together with the transactions contemplated by the Company Stock Purchase Agreement, an "Other Stock Acquisition"); 2 WHEREAS the Company and the Purchaser desire to make certain representations, warranties, covenants and agreements in connection with the Acquisition (as defined in Section 1.01) and also to prescribe various conditions to the Acquisition; NOW, THEREFORE, the parties hereto agree as follows: ARTICLE I Purchase and Sale of Shares; Dollar/Yen Exchange ------------------------------------------------ SECTION 1.01. Purchase and Sale of the Shares. (a) On the terms and subject to the conditions of this Agreement, at the Closing (as defined in Section 2.01), the Company shall issue, sell, transfer and deliver to the Purchaser, and the Purchaser shall subscribe for and purchase from the Company, 13,594,150 Shares (allocated among the Purchaser as set forth on Schedule I) for a purchase price per share equal to (Y)206 (the "Purchase Price"), payable in Japanese yen as set forth below in Section 2.02. The issuance, purchase and sale of the Shares is referred to in this Agreement as the "Acquisition". The Acquisition and the other transactions contemplated by this Agreement and the other Transaction Agreements are referred to in this Agreement collectively as the "Transactions". (b) If there is an adjustment to the aggregate amount of the Merger Consideration (as defined in Merger Agreement) pursuant to Section 2.01(c)(ii) of the Merger Agreement, then the total number of Shares shall be adjusted appropriately to reflect the reduction in the Merger Consideration received by the Purchaser. In no event shall (i) the Purchase Price be affected, (ii) the Purchaser be allocated a number of whole Shares resulting in the Purchaser owing an aggregate Purchase Price under Section 1.01(a) greater than the aggregate PCS Common Merger Consideration (as defined in the Merger Agreement) to which the Purchaser is entitled under the Merger Agreement and (iii) the Purchaser be entitled to purchase fractional Shares. SECTION 1.02. Dollar/Yen Exchange. On the terms and subject to the conditions of this Agreement, the Purchaser agrees that, in lieu of being paid the Merger Consideration (as defined in the Merger Agreement) to which it is entitled under the Merger Agreement in U.S. dollars, it will accept such Merger Consideration converted into Japanese yen at an exchange rate of (Y)117.205 per U.S. dollar (the "Exchange Rate"). Prior to the Effective Time (as defined in the Merger Agreement), the Company shall deposit with the PCS Paying Agent (as defined in the Merger Agreement) the aggregate amount of the Merger Consideration, in yen determined at the Exchange Rate, due to the Purchaser under the Merger Agreement. 3 ARTICLE II Closing ------- SECTION 2.01. Closing. The closing (the "Closing") of the Acquisition shall take place at the offices of Cravath, Swaine & Moore LLP, 825 Eighth Avenue, New York, New York 10019 at the same time during Tokyo business hours that the Merger closing occurs, on the second business day following the satisfaction (or, to the extent permitted, waiver by all parties) of the conditions set forth in Section 7.01, or, if on such day any condition set forth in Section 7.02 or 7.03 has not been satisfied (or, to the extent permitted, waived by the party or parties entitled to the benefits thereof), as soon as practicable after all the conditions set forth in Article VII have been satisfied (or, to the extent permitted, waived by the party or parties entitled to the benefits thereof), or at such other place, time and date as shall be agreed in writing between the Company and the Purchaser. The date on which the Closing occurs is referred to in this Agreement as the "Closing Date". SECTION 2.02. Transactions to Be Effected at the Closing. (a) As soon as commercially practicable after the Closing, the Company shall deliver to the Purchaser certificates representing the Purchaser's Shares, duly endorsed in blank or accompanied by stock powers duly endorsed in blank in proper form for transfer, with appropriate transfer tax stamps, if any, affixed; and (b) At the Closing, the Purchaser shall deliver to the PCS Paying Agent the Certificate or Certificates (as defined in the Merger Agreement) representing the shares of common stock of Mercury held of record by the Purchaser, in accordance with the Merger Agreement and the instructions provided in the letter of transmittal provided to the Purchaser by the PCS Paying Agent (or a duly executed undertaking as required by the letter of transmittal if the Purchaser no longer holds physical certificates), and, upon such delivery, shall instruct the PCS Paying Agent to deliver, from the Merger Consideration represented by such Certificate or Certificates, to the Company payment, to a bank account designated in writing by the Company (such designation to be made at least two business days prior to the Closing Date), of immediately available funds in an amount of Japanese yen equal to the Purchase Price multiplied by the number of Shares allocated to the Purchaser as set forth on Schedule I. ARTICLE III Representations and Warranties of the Company --------------------------------------------- The Company represents and warrants to the Purchaser that, except as set forth in the letter, dated as of the date of this Agreement, from the Company to the Purchaser (the "Company Disclosure Letter"): 4 SECTION 3.01. Organization, Standing and Power. Each of the Company and each of its subsidiaries, including such entities organized under the laws of non-Japanese jurisdictions (the "Company Subsidiaries"), is duly organized, validly existing and in good standing (where such concept is applicable) under the laws of the jurisdiction in which it is organized and has full corporate power and authority, except, in the case of the Company Subsidiaries that are not Significant Company Subsidiaries (as defined below), where the failure to be duly organized, validly existing and in good standing, individually or in the aggregate, has not had and would not be reasonably likely to have a material adverse effect on the Company (a "Company Material Adverse Effect"). The Company and each Company Subsidiary is duly qualified to do business in each jurisdiction where the nature of its business or their ownership or leasing of its properties make such qualification necessary or the failure to so qualify has had or would be reasonably likely to have a Company Material Adverse Effect. The Company has made available to the Purchaser true and complete copies of the articles of incorporation of the Company, as amended to the date of this Agreement (as so amended, the "Company Charter"). SECTION 3.02. Company Subsidiaries; Equity Interests. (a) Section 3.02(a) of the Company Disclosure Letter lists each Significant Company Subsidiary (as defined below) and its jurisdiction of organization. All the outstanding shares of capital stock of each Company Subsidiary have been validly issued and are fully paid and nonassessable and are, as of the date of this Agreement, owned by the Company, by one or more Company Subsidiaries or by the Company and another Company Subsidiary, free and clear of all pledges, liens, charges, mortgages, rights of first refusal, options, restrictions (other than restrictions imposed under applicable Law), leases, licenses, easements, encumbrances and security interests of any kind or nature whatsoever (collectively, "Liens"). The Company has made available to the Purchaser true and complete copies of the articles of incorporation and by-laws, or comparable charter and organizational documents, of each Significant Subsidiary, in each case amended through the date of this Agreement. For purposes of this Agreement, a "Significant Company Subsidiary" means any subsidiary of the Company that constitutes a significant subsidiary within the meaning of Rule 1-02 of Regulation S-X of the United States Securities and Exchange Commission (the "U.S. SEC"). (b) Except for its interests in the Company Subsidiaries, the Company does not as of the date of this Agreement own, directly or indirectly, any capital stock, membership interest, partnership interest, joint venture interest or other equity interest with a fair market value in excess of U.S. $1 million in any person. SECTION 3.03. Capital Structure; the Shares. (a) The authorized number of shares of each class of capital stock of the Company consists of 358,412,200 shares of Company common stock ("Company Common Stock"), 28,572,000 shares of Company Preferred Class A Stock ("Company Class A Preferred Stock") and 5 80,000,000 shares of Company Preferred Class B Stock ("Company Class B Preferred Stock" and, together with the Company Class A Preferred Stock, the "Company Preferred Stock" and, together with the Company Common Stock, the "Company Capital Stock"). The total authorized number of shares of Capital Stock of the Company is 397,510,516 shares. As of the date of this Agreement, (i) 60,300,081 shares of Company Common Stock and 28,572,000 shares of Company Class A Preferred Stock and 10,526,316 shares of Company Class B Preferred Stock were issued and outstanding, (ii) 84,779 shares of Company Common Stock were held by the Company in its treasury and (iii) 5,305,558 shares of Company Common Stock were subject to outstanding options to purchase Company Common Stock ("Company Stock Options"). Except as set forth above, as of the date of this Agreement, no shares of capital stock or other voting securities of the Company were issued, reserved for issuance or outstanding. As of the date of this Agreement, there were outstanding Company Stock Options to purchase 2,429,558 shares of Company Common Stock with exercise prices on a per share basis lower than (Y)220 and the weighted average exercise price of such Company Stock Options was equal to (Y)204.8 per share. All outstanding shares of Company Common Stock are, and all such shares that may be issued prior to the Closing will be when issued, duly authorized, validly issued, fully paid and nonassessable and not subject to or issued in violation of any purchase option, call option, right of first refusal, preemptive right, subscription right or any similar right under any provision of the Japanese Corporation Law ("JCL"), the Company Charter or any Contract (as defined in Section 3.05) to which the Company is a party or otherwise bound. There are not any bonds, debentures, notes or other indebtedness of the Company having the right to vote (or convertible into, or exchangeable for, securities having the right to vote) on any matters on which holders of Company Common Stock may vote ("Voting Company Debt"). Except as set forth above and except for the Equity Commitment (as defined below), there are not any options, warrants, rights, convertible or exchangeable securities, "phantom" stock rights, stock appreciation rights, stock-based performance units, commitments, Contracts, arrangements or undertakings of any kind to which the Company or any Company Subsidiary is a party or by which any of them is bound (i) obligating the Company or any Company Subsidiary to issue, deliver or sell, or cause to be issued, delivered or sold, additional shares of capital stock or other equity interests in, or any security convertible or exercisable for or exchangeable into any capital stock of or other equity interest in, the Company or of any Company Subsidiary or any Voting Company Debt, (ii) obligating the Company or any Company Subsidiary to issue, grant, extend or enter into any such option, warrant, call, right, security, commitment, Contract, arrangement or undertaking or (iii) that give any person the right to receive any economic benefit or right similar to or derived from the economic benefits and rights occurring to holders of Company Common Stock. There are not any outstanding contractual obligations of the Company or any Company Subsidiary to repurchase, redeem or otherwise acquire any shares of capital stock of the Company or any Company Subsidiary. 6 (b) With respect to the Purchaser, assuming the Purchaser has the requisite power and authority to be the lawful owner of the Shares set forth on Schedule I hereto opposite the name of the Purchaser, upon payment of the Purchase Price by the Purchaser at the Closing, such Shares will be duly authorized, validly issued, fully paid and non-assessable, and, subject to the terms of the Stockholders Agreement, free and clear of any Liens, other than those arising from acts of the Purchaser or its affiliates, and free and clear of any restrictive or other legend. Other than this Agreement and the Stockholders Agreement, such Shares will not be subject to any voting trust agreement or other Contract, including any Contract restricting or otherwise relating to the voting, dividend rights or disposition of such Shares. Upon issuance of the Shares, (i) the Shares will have been duly registered under the requirements of the SEL, (ii) an application for the listing thereof will have been duly filed with the TSE and (iii) subject to the terms of the Stockholders Agreement and to TSE reporting requirements, the Shares may be transferred by the Purchaser without the requirement of further registration thereof under the requirements of the SEL or the TSE, other than as a result of acts of the Purchaser. (c) As of the date of this Agreement, the TSE (as defined in Section 3.05(b)) has acknowledged the Transactions, has indicated (orally or in writing) to the Company (or its representatives) that the consummation of the Transactions will not result in a proceeding by the TSE to delist the Company Common Stock from the TSE and the Company has not been notified (and none of the directors of the Company has been notified) that the TSE has commenced or intends to commence a proceeding to delist the Shares from the TSE as a result of the Transactions. SECTION 3.04. Authority; Execution and Delivery; Enforceability. (a) The Company has all requisite corporate power and authority to execute and deliver this Agreement and the Transaction Agreements to which it is a party and to consummate the Transactions to which it is a party. The execution and delivery by the Company of this Agreement and each of the Transaction Agreements to which it is a party and the consummation by the Company of the Transactions to which it is a party have been duly authorized by all necessary corporate action on the part of the Company, subject, in the case of the issuance of the Company Class C Preferred Stock, to receipt of the Company Stockholder Approval (as defined below). The Company has duly executed and delivered this Agreement, and each Transaction Agreement to which it is a party and this Agreement and each Transaction Agreement to which it is a party, assuming the due authorization, execution and delivery thereof by the other parties hereto and thereto, constitutes its legal, valid and binding obligation, enforceable against it in accordance with its terms. (b) The board of directors of the Company (the "Company Board"), at a meeting duly called and held duly and unanimously adopted resolutions (i) approving this Agreement and the other Transaction Agreements, the Acquisition and the other Transactions, (ii) determining that the terms of the Acquisition and the other Transactions are fair to and in the best interests of the stockholders of the Company, (iii) approving the amendment of the Company 7 Charter to authorize the Company Class C Preferred Stock (the "Company Charter Amendment") and (iv) recommending that the Company's stockholders approve the Company Charter Amendment. (c) The only vote of holders of any class or series of Company Capital Stock necessary to consummate the Acquisition and other Transactions is (A) the approval of the Company Charter Amendment (i) by the two-thirds affirmative vote of the total number of votes held by the stockholders present at the Company Common Stock stockholders meeting, (ii) by the two-thirds affirmative vote of the total number of votes held by the stockholders present at the Company Class A Preferred Stock stockholders meeting, (iii) by the two-thirds affirmative vote of the total number of votes held by the stockholders present at the Company Class B Preferred Stock stockholders meeting, and (iv) by the two-thirds affirmative vote of the total number of votes held by the stockholders present at the general stockholders meeting of the Company, (B) the approval of the delegation of authority to the Company Board to determine the terms of the issuance of the Company Class C Preferred Stock upon favorable terms by the two-thirds affirmative vote of the total number of votes held by the stockholders present at the general stockholders meeting of the Company and (C) the approval of the delegation of authority to the Company Board to determine the terms of the issuance of Company Stock Options upon favorable terms by the two-thirds affirmative vote of the total number of votes held by the stockholders present at the general stockholders meeting of the Company, which, in the case of each of (A), (B) and (C), may and will be effected at the Company Stockholder Meetings (as defined in Section 6.01(b)) (the "Company Stockholder Approval"). The affirmative vote of the holders of Company Capital Stock, or any of them, is not necessary to approve any Transaction Agreement or consummate any Transaction other than the Company Charter Amendment and the matters referred to in this Section 3.04(c). SECTION 3.05. No Conflicts; Consents. (a) The execution and delivery by the Company of this Agreement and each Transaction Agreement to which it is a party do not and the consummation of the Acquisition and the other Transactions to which it is a party and compliance with and performance of the terms hereof and thereof will not, conflict with, or result in any violation of or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancelation or acceleration of any obligation or to loss of a material benefit under, or to increased, additional, accelerated or guaranteed rights or entitlements of any person under, or result in the creation of any Lien upon any of the properties or assets of the Company or any Company Subsidiary under, any provision of (i) the Company Charter or the comparable charter or organizational documents of any Significant Company Subsidiary, (ii) subject to effectiveness of the Company Facility Amendments (as defined in Section 3.20) as contemplated by the Company Consent Letter (as defined in Section 3.20), any material contract, lease, license, indenture, note, bond, agreement, permit, concession, franchise or other instrument (a 8 "Contract") to which the Company or any Company Subsidiary is a party or by which any of their respective properties or assets is bound or (iii) subject to the filings and other matters referred to in Section 3.05(b), any material judgment, order or decree ("Judgment") or statute, law (including common law), ordinance, rule or regulation ("Law") applicable to the Company or any Company Subsidiary or their respective properties or assets, other than, in the case of clauses (ii) and (iii) above, any such items that, individually or in the aggregate, have not had and would not be reasonably likely to have a Company Material Adverse Effect (excluding for purposes of this Section 3.05(a) and the application of Section 7.02(a) hereto, clause (a)(iii) of the definition "material adverse effect"). (b) No consent, approval, license, permit, order or authorization ("Consent") of, or registration, declaration or filing with, or permit from, any national, local or foreign government or any court of competent jurisdiction, administrative agency or commission or other governmental authority or instrumentality, domestic or foreign (a "Governmental Entity") is required to be obtained or made by or with respect to the Company or any Company Subsidiary in connection with the execution, delivery and performance of this Agreement or any Transaction Agreement to which it is a party and the consummation of the Transactions to which it is a party, other than (i) compliance with and filings under (A) the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act"), (B) Japanese Anti-Monopoly Law (Law No. 54 of 1947, as amended) (the "Japanese Anti-Monopoly Law"), (C) other Antitrust Laws (as defined in Section 6.03(c)), (D) the Foreign Exchange and Foreign Trade Law of Japan (Law No. 228 of 1949, as amended) (the "FEL"), (E) the rules and regulations of the Tokyo Stock Exchange ("TSE"), (F) the JCL and (G) the Japanese Commercial Registration Law (Law No. 125 of 1963, as amended) (the "CRL"), (ii) the filing with the U.S. SEC of (A) an information statement with respect to the Merger (such information statement, including all information required to be included therein by Rule 13e-3 promulgated under the Securities and Exchange Act of 1934, as amended (the "Exchange Act"), as such information statement is amended from time to time, the "U.S. Information Statement") and (B) such reports under Section 13 of the Exchange Act as may be required in connection with this Agreement, the other Transaction Agreements, the Merger and the other Transactions, (iii) the filing with the Kanto Local Finance Bureau or any other local finance bureau (collectively, the "Bureau") of such registration, reports and other information (such registration, reports and other information, as amended from time to time, the "Information Statement") as may be required under the Japanese Securities and Exchange Law (Law No. 25 of 1948, as amended) (the "SEL") in connection with this Agreement, the other Transaction Agreements, the Acquisition and the other Transactions, (iv) the filing of a certificate of merger in connection with the Merger with the Secretary of State of the State of Delaware and appropriate documents with the relevant authorities of the other jurisdictions in which the Company is qualified to do business, (v) compliance with and such filings as may be required under applicable Environmental Laws (as defined in Section 3.14), (vi) such filings as may be required in connection with the Taxes described in Section 6.06, (vii) filings 9 under any applicable state takeover Law and (viii) such other items (A) required solely by reason of the participation of the Purchaser (as opposed to any third party) in the Transactions or (B) that, individually or in the aggregate, have not had and would not be reasonably likely to have a Company Material Adverse Effect (excluding for purposes of this Section 3.05(b) and the application of Section 7.02(a) hereto, clause (a)(iii) of the definition "material adverse effect"). SECTION 3.06. SEL Documents; Undisclosed Liabilities. (a) The Company has filed all reports, schedules, forms, statements and other documents required to be filed by the Company with the Bureau, since March 31, 2006, pursuant to the regulations of the SEL (the "Company SEL Documents"). (b) As of its respective date, each Company SEL Document complied in all material respects with the requirements of the SEL, as the case may be, and the rules and regulations under the SEL applicable to such Company SEL Document, and did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading. The consolidated financial statements of the Company included in the Company SEL Documents comply as of their respective dates as to form in all material respects with applicable accounting requirements and the published rules and regulations under the SEL with respect thereto, have been prepared in accordance with Japanese generally accepted accounting principles ("GAAP") applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto) and fairly present the consolidated financial position of the Company and its consolidated subsidiaries as of the dates thereof and the consolidated results of their operations and cash flows for the periods shown (subject, in the case of unaudited statements, to normal year-end audit adjustments and lack of footnote disclosure as permitted under the SEL. (c) Except as set forth in the most recent audited consolidated balance sheet of the Company (including the notes thereto) included in the Filed Company SEL Documents (as defined in Section 3.08), and except for liabilities and obligations incurred in the ordinary course of business since the date of such balance sheet, neither the Company nor any Company Subsidiary has any liabilities or obligations of any nature (whether accrued, absolute, contingent or otherwise) required by GAAP to be set forth on a consolidated balance sheet of the Company and its consolidated subsidiaries or in the notes thereto that, individually or in the aggregate, would be reasonably likely to have a Company Material Adverse Effect. (d) The effectiveness of any additional disclosure requirement or applicable accounting rule, consensus or pronouncement that has been formally proposed or adopted by the FSA (as defined in Section 6.01), any Japanese financial accounting standards board or any similar body but that is not yet in 10 effect, is not reasonably likely to lead to any material change in the Company's disclosures as set forth in the Filed Company SEL Documents. (e) None of the Company Subsidiaries is, or has at any time since March 31, 2006, been, subject to (separately from the Company) the reporting requirements under the SEL. SECTION 3.07. Information Supplied. None of the information supplied or to be supplied by the Company for inclusion or incorporation by reference in the Information Statement or any other document required to be filed by the Company with the Bureau relating to the Transactions, including the Acquisition (the "Company Disclosure Documents") will contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading. The Company Disclosure Documents will comply as to form in all material respects with the requirements of the SEL and the rules and regulations thereunder, except that no representation is made by the Company with respect to statements made or incorporated by reference therein or omitted therefrom based on information supplied by the Purchaser in writing for inclusion or incorporation by reference therein. SECTION 3.08. Absence of Certain Changes or Events. (a) From the date of the most recent audited financial statements included in the Company SEL Documents filed and publicly available prior to the date of this Agreement (the "Filed Company SEL Documents") to the date of this Agreement, the Company has conducted its business only in the ordinary course, and during such period there has not been: (i) any event, change, effect, development or state of facts that, individually or in the aggregate, has had or would be reasonably likely to have a Company Material Adverse Effect; (ii) any declaration, setting aside, allotment or payment of any dividend or other distribution (whether in cash, stock or property) with respect to any Company Common Stock or any repurchase for value by the Company of any Company Common Stock; (iii) any split, combination or reclassification of any Company Common Stock or any issuance or the authorization of any issuance of any other securities in respect of, in lieu of or in substitution for shares of Company Common Stock; (iv) (A) any grant by the Company or any Company Subsidiary to any current director or officer of the Company or to any other employee or independent contractor of the Company or any Company Subsidiary reasonably likely to earn annual base compensation and bonuses in 2006 of $200,000 or more (any such current director or 11 officer of the Company or other employee or independent contractor, a "Covered Participant") of any loan or any increase in any type of compensation, benefits, perquisites or bonus or award opportunity, except for grants of normal cash bonus opportunities, normal increases of cash compensation and increases in fringe or other benefits that are not material, in each case in the ordinary course of business consistent with prior practice or as was required under employment agreements in effect as of the date of the most recent audited financial statements included in the Filed Company SEL Documents, (B) any grant by the Company or any Company Subsidiary to any Covered Participant of any severance, change in control, termination or similar compensation or benefits or increases therein, or of the right to receive any severance, change in control, termination or similar compensation or benefits or increases therein, except as was required under employment, severance or termination agreements in effect as of the date of the most recent audited financial statements included in the Filed Company SEL Documents, (C) any action by the Company or any Company Subsidiary to fund or in any other way secure the payment of a material amount of compensation or benefits under any Company Benefit Plan (as defined in Section 3.10(a)) or Company Benefit Agreement (as defined in Section 3.10(b)) or (D) any entry by the Company or any Company Subsidiary into, or any amendment of, any Company Benefit Agreement with any Covered Participant; (v) any damage, destruction or loss, whether or not covered by insurance, that, individually or in the aggregate, would be reasonably likely to have a Company Material Adverse Effect; (vi) any change in accounting methods, principles or practices by the Company or any Company Subsidiary materially affecting the consolidated assets, liabilities or results of operations of the Company, except insofar as may have been required by a change in GAAP or applicable Law; (vii) any material elections with respect to Taxes (as defined in Section 3.09) by the Company or any Company Subsidiary or settlement or compromise by the Company or any Company Subsidiary of any material Tax liability or refund; (viii) any material revaluation by the Company or any Company Subsidiary of any of the material assets of the Company or any Company Subsidiary, except insofar as may have been required by applicable Law; or (ix) any action by the Company or any Company Subsidiary which, if taken after the date hereof, would constitute a breach of any provisions of Section 5.01(a)(ii), (iv) or (vi) or any authorization, consent or agreement by the Company or any Company Subsidiary to take any of the actions prohibited by the foregoing provisions of Section 5.01(a). 12 SECTION 3.09. Taxes. (a) The Company, and each Company Subsidiary, has duly and timely filed, or has caused to be timely filed on its behalf, all material Tax Returns required to be filed by it. All such Tax Returns were true, correct and complete in all material respects. All material Taxes owed (whether or not shown on any Tax Return) have been timely paid in full. To the Company's knowledge, no claim has been made in writing during the three year period ending on the Closing Date by an authority in a jurisdiction where the Company, or any Company Subsidiary, does not file Tax Returns that the Company, or any Company Subsidiary, is or may be subject to taxation by that jurisdiction. There are no liens with respect to Taxes upon any asset of the Company, or any Company Subsidiary, other than liens for Taxes not yet due and payable. (b) The Company, and each Company Subsidiary, has deducted, withheld and timely paid to the appropriate governmental authority all material Taxes required to be deducted, withheld or paid in connection with amounts paid or owing to any employee, independent contractor, creditor, stockholder or other third party, and the Company, and each Company Subsidiary, has complied with all material reporting and record keeping requirements. (c) No dispute, audit, investigation, proceeding or claim concerning any material Tax liability of the Company, or any Company Subsidiary, has been raised by a governmental authority in writing, and to the Company's knowledge, no such dispute, audit, investigation, proceeding, or claim is pending or being conducted. The Company has provided or made available to the Purchaser true, correct and complete copies of all material Tax Returns, examination reports, and statements of deficiencies filed, assessed against, or agreed to by the Company or any Company Subsidiary since January 1, 2001. (d) The Company, and each Company Subsidiary, has not waived any statute of limitations in respect of material Taxes or agreed to any extension of time with respect to a material Tax assessment or deficiency. The Company, and each Company Subsidiary, has not executed any power of attorney with respect to any Tax, other than powers of attorney that are no longer in force. Section 3.09(d) of the Company Disclosure Letter lists all closing agreements, private letter rulings, technical advice memoranda, binding oral agreements, rulings or advice or similar agreements or rulings relating to Taxes that have been entered into or issued by any governmental authority with or in respect of the Company and each Company Subsidiary since January 1, 2001. (e) The Company, and each Company Subsidiary, is not a party to any contractual obligation relating to Tax sharing or Tax allocation, other than customary commercial agreements with vendors, lenders, customers and other third parties (such as tax gross-ups in loan agreements or property tax escalation clauses in real estate leases) entered into in the ordinary course of business. The Company, and each Company Subsidiary, does not have any material liability for the Taxes of any person under any provision of national, local or foreign law, as a transferee or successor or by contract. 13 (f) The Company, and each Company Subsidiary, will not be required to include any amount in taxable income or exclude any item of deduction or loss from taxable income for any taxable period (or portion thereof) ending after the Closing Date as a result of (a) any "closing agreement" as described in any provision of national, state, local or foreign Income Tax law executed on or prior to the Closing Date, (b) any deferred intercompany gain or excess loss account described in any provision or administrative rule of national, local or foreign law, (c) any installment sale or open transaction disposition made on or prior to the Closing Date, or (d) any prepaid amount received on or prior to the Closing Date. (g) For purposes of this Agreement: "Tax" or "Taxes" means (i) any and all national, local, or foreign income, gross receipts, license, payroll, employment, excise, severance, stamp, occupation, premium, windfall profits, environmental, customs duties, capital stock, franchise, profits, withholding, social security (or similar), unemployment, disability, real property, personal property, sales, use, transfer, registration, value added, alternative or add-on minimum, estimated, or other tax of any kind or any charge of any kind in the nature of (or similar to) taxes whatsoever, including any interest, penalty, or addition thereto, whether disputed or not and (ii) any liability for the payment of any amounts of the type described in clause (i) of this definition as a result of being a member of an affiliated, consolidated, combined or unitary group for any period, as a result of any tax sharing or tax allocation agreement, arrangement or understanding, or as a result of being liable for another person's taxes as a transferee or successor or by contract. "Tax Return" or "Return" means all national, local and foreign Tax returns, declarations, statements, reports, schedules, forms and information returns and any amended Tax return relating to Taxes. SECTION 3.10. Absence of Changes in Benefit Plans. (a) From the date of the most recent audited financial statements included in the Filed Company SEL Documents to the date of this Agreement, neither the Company nor any Company Subsidiary has terminated, adopted, amended, modified or agreed to terminate, adopt, amend or modify (or announced an intention to terminate, adopt, amend or modify), in any material respect, any collective bargaining agreement or any bonus, pension, profit sharing, deferred compensation, incentive compensation, equity compensation, stock ownership, stock purchase, stock appreciation, restricted stock, stock option, phantom stock, performance, retirement, thrift, savings, stock bonus, cafeteria, paid time off, perquisite, fringe benefit, vacation, unemployment insurance, severance, change in control, termination, retention, disability, death benefit, hospitalization, medical or other welfare benefit or other employee benefit plan, program, policy or arrangement, whether oral or written, funded or unfunded, sponsored, maintained, contributed to or required to be sponsored, maintained or contributed to by the Company or any Company Subsidiary or any other person or 14 entity that, together with the Company or any Company Subsidiary, is treated as a single employer under any applicable Law (each, a "Commonly Controlled Entity"), in each case providing benefits to any current or former director, officer, employee or independent contractor of the Company or any Company Subsidiary (each, a "Participant") and whether or not subject to Japanese law (all such plans, programs and arrangements, including any such plan, program or arrangement entered into or adopted on or after the date of this Agreement, "Company Benefit Plans") or has made any material change in any actuarial or other assumption used to calculate funding obligations with respect to any Company Benefit Plan that is a Company Pension Plan (as defined in Section 3.11(a)), or any material change in the manner in which contributions to any such Company Pension Plan are made or the basis on which such contributions are determined. (b) As of the date of this Agreement, there is not any material (i) employment, deferred compensation, severance, change in control, termination, employee benefit, loan, indemnification, retention, equity compensation, bonus, award, consulting or similar agreement between the Company or any Company Subsidiary, on the one hand, and any Participant, on the other hand, (ii) agreement between the Company or any Company Subsidiary, on the one hand, and any Participant, on the other hand, the benefits of which are contingent, or the terms of which are materially altered, upon the occurrence of transactions involving the Company or any Company Subsidiary of the nature contemplated by this Agreement or (iii) trust or insurance Contract or other agreement to fund or otherwise secure payment of any compensation or benefit to be provided to any Participant (all such agreements under clauses (i), (ii) and (iii), collectively, "Company Benefit Agreements"). (c) To the Company's knowledge, the exercise price of each Company Stock Option is not less than the fair market value of a share of Company Common Stock as determined on the date of grant of such Company Stock Option. SECTION 3.11. Benefit Plans. (a) Section 3.11(a) of the Company Disclosure Letter contains a complete and correct list of all Company Benefit Plans that are "employee pension benefit plans" (as defined in Section 3(2) of the Employee Retirement Income Security Act of 1974, as amended ("ERISA")), whether or not subject to ERISA (a "Company Pension Plan"), or "employee welfare benefit plans" (as defined in Section 3(1) of ERISA), whether or not subject to ERISA, and all other material Company Benefit Plans. The Company has delivered or made available to the Purchaser complete and correct copies of (i) each such Company Benefit Plan and each material Company Benefit Agreement (or, in the case of any such Company Benefit Plan or material Company Benefit Agreement that is unwritten, a written description thereof), (ii) the two most recent annual reports required to be filed, or such similar reports, statements, information returns or material correspondence required to be filed with or delivered to any Governmental Entity, with respect to each material Company Benefit Plan , (iii) the most recent summary plan description for each 15 material Company Benefit Plan for which a summary plan description is required under applicable Law, and any summary of material modifications prepared for each material Company Benefit Plan, (iv) each trust agreement and group annuity or insurance contract and other documents relating to the funding or payment of benefits under any material Company Benefit Plan, (v) the most recent determination or qualification letter issued by any Governmental Entity for each Company Benefit Plan intended to qualify for favorable Tax treatment for which such a letter has been obtained, as well as a true, correct and complete copy of each pending application therefor, if applicable, and (vi) the two most recent actuarial valuations for each material Company Benefit Plan for which actuarial valuations have been obtained. Section 3.11(a) of the Company Disclosure Letter sets forth the forecasted obligation amount as of December 31, 2005, as determined by GAAP, for each Company Benefit Plan. Proper provision or reserve for the Company Benefit Plans and for all private pension payments reasonably likely to be required to be made by the Company has been made for accounting purposes under GAAP. (b) (i) Each Company Benefit Plan has been administered in compliance with its terms, and (ii) each Company Benefit Plan (and the Company and the Company Subsidiaries with respect to such plans) is in compliance with applicable Law and the terms of any applicable collective bargaining agreements, except for such instances of noncompliance with either plan terms or Laws that, individually or in the aggregate, have not had and would not reasonably be likely to have a Company Material Adverse Effect. (c) Each Company Benefit Plan required to have been approved by any non-U.S. Governmental Entity (or permitted to have been approved to obtain any beneficial Tax or other status) has been so approved; no such approval has been revoked (nor, to the knowledge of the Company, has revocation been threatened) and no event has occurred since the date of the most recent approval that could reasonably be expected to affect any such approval, except for such failures to approve, revocations of approval and events that, individually or in the aggregate, have not had and would not be reasonably likely to have a Company Material Adverse Effect. (d) None of the Company, any Company Subsidiary, any employee of the Company or any Company Subsidiary, any of the Company Benefit Plans, including the Company Pension Plans and, to the knowledge of the Company, any trusts created under any of the Company Benefit Plans or any trustee, administrator or other fiduciary of any Company Benefit Plan or trust created thereunder and any agent of the foregoing, has engaged in a "prohibited transaction" under applicable Law or any other breach of fiduciary responsibility that could subject the Company, any Company Subsidiary, any such employee or any of the Company Benefit Plans, or, to the knowledge of the Company, any such trust, trustee, administrator or other fiduciary, to Tax or penalty on prohibited transactions imposed under applicable Law or any other liability for breach of fiduciary duty under any applicable Law, except for such prohibited 16 transactions and other breaches of fiduciary responsibility that, individually or in the aggregate, have not had and would not be reasonably likely to have a Company Material Adverse Effect. (e) With respect to any Company Benefit Plan that is an employee welfare benefit plan, whether or not subject to ERISA, no such Company Benefit Plan provides benefits after termination of employment, except where the cost thereof is borne entirely by the former employee (or his or her eligible dependents or beneficiaries). (f) No Participant will be entitled to (i)(A) any severance, separation, change of control, termination, bonus or other additional compensation or benefits, or (B) any acceleration of the time of payment or vesting of any compensation or benefits, including the accelerated vesting of Company Stock Options held by such Participant, or the forgiveness of indebtedness owed by such Participant, in each case as a result of any of the Transactions (alone or in combination with any other event) or in connection with the termination of such Participant's employment on or after the Effective Time or (ii) any compensation or benefits related to or contingent upon, or the value of which will be calculated on the basis of, any of the Transactions (alone or in combination with any other event). The execution and delivery of this Agreement and the consummation of the Transactions (alone or in combination with any other event) and compliance by the Company with the provisions hereof do not and will not require the funding (whether through a grantor trust or otherwise) of any Company Benefit Plan, Company Benefit Agreement or any other employment arrangement and will not limit the Company's ability to amend, modify or terminate any Company Benefit Plan or Company Benefit Agreement. (g) Since January 1, 2003, and through the date of this Agreement, neither the Company nor any Company Subsidiary has received notice of, and, to the knowledge of the Company, there are no (i) pending termination proceedings or other suits, claims (except claims for benefits payable in the normal operation of the Company Benefit Plans), actions or proceedings against, or involving or asserting any rights or claims to benefits under, any Company Benefit Plan or Company Benefit Agreement or (ii) pending investigations (other than routine inquiries) by any Governmental Entity with respect to any Company Benefit Plan or Company Benefit Agreement, except for such proceedings, suits, claims, actions and investigations that, individually or in the aggregate, have not had and would not be reasonably likely to have a Company Material Adverse Effect. (h) Neither the Company nor any Company Subsidiary has any liability or obligations, including under or on account of a Company Benefit Plan or Company Benefit Agreement, arising out of the hiring of persons to provide services to the Company or any Company Subsidiary and treating such persons as consultants or independent contractors and not as employees of the Company or any Company Subsidiary, except for any such liability and obligations that, individually or in the aggregate, have not had and would not be reasonably likely to have a Company Material Adverse Effect. 17 (i) None of the employees of the Company or any Company Subsidiary is a member of, represented by or otherwise subject to any (i) labor union, works council or similar organization or (ii) collective bargaining agreement, industry-wide collective bargaining agreement or any similar collective agreement, in each case with respect to such employee's employment by the Company or any Company Subsidiary, and the Company and the Company Subsidiaries do not have any obligation (including to inform or consult with any such employees or their representatives in respect of the Transactions) with respect to any such organization or agreement. Each of the Company and the Company Subsidiaries is in compliance with all applicable Laws and orders with respect to labor relations, employment and employment practices, occupational safety and health standards, terms and conditions of employment, payment of wages, classification of employees, immigration, visa, work status, pay equity and workers compensation, and is not engaged in any unfair labor practice, except for such failures to comply and unfair labor practices that, individually or in the aggregate, have not had and would not be reasonably likely to have a Company Material Adverse Effect. There is no unfair labor practice charge or complaint against the Company or any Company Subsidiary pending or, to the knowledge of the Company, threatened before the competent Labor Standards Supervision Office ("Roudou Kijun Kantoku Sho"), the competent Committee on Labor Affairs ("Roudou I-inkai") or any comparable Governmental Entity that has had or would be reasonably likely to have a Company Material Adverse Effect. Since December 31, 2003, there has been no, and there currently is no, labor strike, material dispute, request for representation, union organization attempt, slowdown or stoppage actually pending or, to the knowledge of the Company, threatened against or affecting the Company or any Company Subsidiary that, individually or in the aggregate, has had or would reasonably be expected to have a Company Material Adverse Effect. No grievance or arbitration proceeding arising out of a collective bargaining agreement is pending or, to the knowledge of the Company, threatened against the Company or any Company Subsidiary that has had or would be reasonably likely to have a Company Material Adverse Effect. SECTION 3.12. Litigation. (a) As of the date of this Agreement, there is no claim, demand, suit, action or proceeding pending or, to the knowledge of the Company, threatened in writing against or affecting the Company or any Company Subsidiary that involves an amount in controversy in excess of $1.0 million, seeks material injunctive relief or would be reasonably likely to have a Company Material Adverse Effect, if resolved in accordance with the plaintiff's demands. (b) There is no suit, action or proceeding pending or, to the knowledge of the Company, threatened against or affecting the Company or any Company Subsidiary nor is there any judgment outstanding against the Company or 18 any Company Subsidiary that, individually or in the aggregate, has had or would be reasonably likely to have a Company Material Adverse Effect. SECTION 3.13. Compliance with Applicable Laws. The Company and the Company Subsidiaries and their relevant personnel and operations are in compliance with all applicable Laws, including those relating to occupational health and safety except for any such failure to be in compliance as, individually or in the aggregate, has not had and would not be reasonably likely to have a Company Material Adverse Effect. Neither the Company nor any Company Subsidiary has received any written communication during the past two years from a Governmental Entity that alleges that the Company or a Company Subsidiary is not in compliance with any applicable Law except for such failure to be in compliance as, individually or in the aggregate, has not had and would not be reasonably likely to have a Company Material Adverse Effect. The Company and the Company Subsidiaries have in effect all permits, licenses, variances, exemptions, authorizations, operating certificates, franchises, orders and approvals of all Governmental Entities (collectively, "Permits"), necessary for them to own, lease or operate their properties and assets and to carry on their businesses as now conducted, except for such Permits the absence of which, individually or in the aggregate, has not had and would not be reasonably likely to have a Company Material Adverse Effect and there has occurred no violation of, default (with or without the lapse of time or the giving of notice, or both) under, or event giving to others any right of termination, amendment or cancelation of, with or without notice or lapse of time or both, any such Permit, except for such violations, defaults or events that, individually or in the aggregate, have not had and would not be reasonably likely to have a Company Material Adverse Effect. This Section 3.13 does not relate to matters with respect to Taxes, which are the subject of Section 3.09 or to Environmental Permits or Environmental Laws, which are the subject of Section 3.14. SECTION 3.14. Environmental Matters. Except for such matters that, individually or in the aggregate, have not had and would not be reasonably likely to have a Company Material Adverse Effect: (a) The Company and each of the Company Subsidiaries are in compliance with all Environmental Laws (as defined below). (b) Since July 31, 2003, neither the Company nor any of the Company Subsidiaries has received any written communication that alleges that the Company or any of its subsidiaries is in violation of or has liability under any Environmental Law or written request for information pursuant to any Environmental Law. (c) (i) The Company and each of the Company Subsidiaries have obtained and are in compliance with all Permits pursuant to Environmental Law (collectively "Environmental Permits") necessary for their operations as presently conducted and (ii) all such Environmental Permits are valid and in good standing. 19 (d) There are no Environmental Claims pending or, to the knowledge of the Company, threatened in writing, against the Company or any of the Company Subsidiaries. (e) Neither the Company nor any of the Company Subsidiaries has entered into or agreed to, or is otherwise subject to, any Judgment relating to any Environmental Law or to the investigation or remediation of Hazardous Materials (as defined below). (f) There has been no treatment, storage or Release (as defined below) of any Hazardous Material that would be reasonably likely to form the basis of any Environmental Claim against the Company or any of the Company Subsidiaries or against any person whose liabilities the Company or any of the Company Subsidiaries has retained or assumed either contractually or by operation of law. (g) None of the Company, the Company Subsidiaries or any Person whose liabilities the Company or any of the Company Subsidiaries has, or may have, retained or assumed, either contractually or by operation of law, has manufactured, sold or distributed any products containing asbestos in any form. (h) (i) neither the Company nor any of the Company Subsidiaries has retained or assumed, either contractually or by operation of law, any liabilities or obligations that would be reasonably likely to form the basis of any Environmental Claim (as defined below) against the Company or any of the Company Subsidiaries, and (ii) to the knowledge of the Company, no Environmental Claims are pending against any Person whose liabilities the Company or any of the Company Subsidiaries has, or may have, retained or assumed, either contractually or by operation of law. (i) Definitions. As used in this Agreement: (1) "Environmental Claim" means any and all administrative, regulatory or judicial actions, suits, demands, directives, claims, liens, Judgments, investigations, proceedings or written notices of noncompliance, violation or potential responsibility alleging liability of whatever kind or nature (including liability or responsibility for the costs of enforcement proceedings, investigations, cleanup, governmental response, removal or remediation, natural resources damages, property damages, personal injuries, medical monitoring, penalties, contribution, indemnification and injunctive relief) arising out of, based on or resulting from (x) the presence or Release of, or exposure to, any Hazardous Materials at any location; or (y) the failure to comply with any Environmental Law; (2) "Environmental Laws" means all applicable national, local and foreign laws, rules, regulations, Judgments, legally binding agreements, standards prescribed by Governmental Entities or Environmental Permits issued, promulgated or entered into by or with 20 any Governmental Entity, relating to pollution or protection or restoration of natural resources or the environment (including ambient air, indoor air, surface water, groundwater, land surface or subsurface strata), endangered or threatened species or human health (to the extent relating to exposure to Hazardous Materials); (3) "Hazardous Materials" means any contaminant, pollutant, waste or other substance which is defined as hazardous or toxic under Environmental Laws, or the release or presence of which is regulated under any Environmental Law; and (4) "Release" means any actual or threatened release, spill, emission, leaking, dumping, injection, pouring, deposit, disposal, discharge, dispersal, leaching or migration into or through the environment (including ambient air, indoor air, surface water, groundwater, land surface or subsurface strata) or within any building, structure, facility or fixture. SECTION 3.15. Intellectual Property. The Company or one of the Company Subsidiaries owns, or is validly licensed or otherwise has the right to use, all patents, patent rights, trademarks, trademark rights, trade names, trade name rights, service marks, service mark rights, copyrights, domain names and other proprietary intellectual property rights and computer programs (collectively, "Intellectual Property Rights") used in the conduct of the business of the Company and the Company Subsidiaries, except where the failure to own, be validly licensed or have the right to use such Intellectual Property Rights, individually or in the aggregate, has not had and would not be reasonably likely to have a Company Material Adverse Effect. No claims are pending or, to the knowledge of the Company, threatened in writing that the Company or any Company Subsidiary is infringing or otherwise adversely affecting the rights of any person with regard to any Intellectual Property Right, except for any such claims that, individually or in the aggregate, have not had and would not be reasonably likely to have a Company Material Adverse Effect. To the knowledge of the Company, no person is infringing the rights of the Company or any Company Subsidiary with respect to any Intellectual Property Right, except for such infringements that, individually or in the aggregate, have not had and would not be reasonably likely to have a Company Material Adverse Effect. SECTION 3.16. Contracts. (a) None of the Company, any of the Company Subsidiaries or, to the knowledge of the Company, any other party to any Company Material Contract is in violation of or in default under (nor does there exist any condition which upon the passage of time or the giving of notice would cause such a violation of or default under) any Company Material Contract, to which it is a party or by which it or any of its properties or assets is bound, except for violations or defaults that, individually or in the 21 aggregate, have not resulted and would not be reasonably likely to result in a Company Material Adverse Effect. A "Company Material Contract" means any contract to which the Company or any Company Subsidiary is a party that provides for payment or series of payments or performance by a party thereto having an aggregate value exceeding 100 million Japanese yen or equivalent amount of foreign currency therewith per year. (b) All Company Material Contracts are valid, binding and in full force and effect and are enforceable by the Company or the applicable Company Subsidiary in accordance with their terms, except for such failures to be valid, binding, in full force and effect or enforceable that, individually or in the aggregate, have not had and would not be reasonably likely to have a Company Material Adverse Effect. None of the Company and the Company Subsidiaries has received any written notice of the intention of any party to terminate any Company Material Contract. Complete and correct copies of all Company Material Contracts, together with all material modifications and amendments thereto, have been made available to the Purchaser (either as an exhibit to a Filed SEL Document or otherwise). SECTION 3.17. Title to Real Properties. (a) Each of the Company and each Company Subsidiary has good and marketable title to, or valid leasehold interests in, all its real properties free and clear of all Liens, except for such defects in title, easements, restrictive covenants and similar encumbrances or impediments that, individually or in the aggregate, have not had and would not be reasonably likely to have a Company Material Adverse Effect. (b) Except where the failure to comply, the failure to be in full force and effect or the default has not had and would not be reasonably likely to have a Company Material Adverse Effect, each of the Company and each Company Subsidiary has complied in all respects with the terms of all leases to which it is a party and under which it is in occupancy, all such leases are in full force and effect and no extant notice of default has been given by either party to such leases, and no event has occurred, which with the giving of notice or the passage of time or both would constitute a default under any of such leases. SECTION 3.18. Customers and Suppliers. (a) Since January 1, 2005, there has been no adverse change in the relationship of the Company with any customer of the Company or any Company Subsidiary with annual sales of $15 million or more or any of the 15 largest suppliers to the Company or any Company Subsidiary by annual sales volume (excluding utilities), except for such change that, individually or in the aggregate, has not had and would not be reasonably likely to have a Company Material Adverse Effect. (b) To the Knowledge of the Company, there is no material dispute with any customer with annual sales of $15 million or more in connection with any product sold by the Company or any Company Subsidiary to any such customer that has given rise or would be reasonably likely to give rise to a material 22 liability or cost, except for such dispute that, individually or in the aggregate, has not had and would not be reasonably likely to have a Company Material Adverse Effect. SECTION 3.19. Brokers; Schedule of Fees and Expenses. No broker, investment banker, financial advisor or other person, other than Deutsche Bank Securities Inc. and RHJI, the fees and expenses of which will be paid by the Company, is entitled to any broker's, finder's, financial advisor's or other similar fee or commission in connection with the Acquisition and the other Transactions based upon arrangements made by or on behalf of the Company. SECTION 3.20. Financing. (a) The Company has received and accepted (1) a commitment letter dated August 31, 2006 (the "Commitment Letter"), from the lenders party thereto (collectively, the "Lenders") relating to the commitment of the Lenders to provide the debt financing required by Mercury and its subsidiaries to effect the Refinancing (as defined below) and to pay related fees and expenses of the Transactions, (2) a commitment letter dated August 28, 2006 (the "Company Commitment Letter"), from Aozora Bank, Ltd., ("Aozora")relating to the commitment of Aozora to provide the bridge financing (the "Bridge Financing") required by the Company, the Purchasers and the holders of Mercury common stock and holders of Mercury preferred stock to consummate the Merger, the Acquisition and the Other Stock Acquisitions, (3) the commitment letter dated August 29, 2006, from Aozora, on behalf of the lenders (the "Company Lenders") under the Company's existing credit facility (the "Company Consent Letter") to enter into a consent agreement confirming the approval by the Company Lenders of certain amendments to the Company's existing credit facility required thereunder by the Company in connection with the Transactions and Refinancing (as defined below) (the "Company Facility Amendments") and (4) a commitment letter dated August 31, 2006 (the "Equity Commitment" and, together with the Commitment Letter, the Company Commitment Letter and the Company Consent Letter, the "Commitments"), between RHJI, and the Company relating to the agreement of RHJI to provide the equity financing to the Company as specified therein (the "RHJI equity financing"). The Company has provided or made available to the Purchasers' Representative a true, correct and complete copy of each of the Commitments. The financing contemplated by the Commitment Letter, the Company Consent Letter and the Company Commitment Letter is referred to herein as the "Financing." (b) Subject to its terms and conditions, the Financing and RHJI equity financing, when funded in accordance with the applicable terms and conditions of the Commitment Letter, Company Commitment Letter, Company Consent Letter and Equity Commitment, will provide Acquisition Sub with funds at the Effective Time sufficient to (i) consummate the Merger, (ii) finance the Consent Solicitations (as defined in the Merger Agreement), (iii) refinance the 23 existing indebtedness of Mercury and its subsidiaries described in the Commitment Letter (the "Refinancing"), (iv) provide the Bridge Financing and (v) pay related fees and expenses of the Transactions. ARTICLE IV Representations and Warranties of the Purchaser ----------------------------------------------- The Purchaser represents and warrants to the Company that: SECTION 4.01. Organization, Standing and Power. (a) The Purchaser is duly organized, validly existing and in good standing under the laws of the jurisdiction in which it is organized and has full power and authority to conduct its businesses as presently conducted. SECTION 4.02. Accredited Investor; Private Offering. (a) The Purchaser is (i) an "accredited investor" as such term is defined in Rule 501(a) of Regulation D promulgated under the Securities Act of 1933, as amended (the "Securities Act"), (ii) a "qualified purchaser" within the meaning of the Investment Company Act of 1940, as amended (the "Investment Company Act") and (iii) not an "investment company" as defined in Section 3 of the Investment Company Act, and meets at least one category and has indicated all categories applicable to it in each of Sections A, B and C of the Accredited Investor Questionnaire attached hereto as Exhibit C. (b) Private Offering. The Company Stock purchased by the Purchaser pursuant to this Agreement is being acquired for investment only and not with a view to any public distribution thereof, and the Purchaser shall not offer to sell or otherwise dispose of such Company Stock so acquired by it in violation of any of the registration requirements of the Securities Act. SECTION 4.03. Authority; Execution and Delivery; Enforceability. The Purchaser has all requisite power and authority to execute and deliver this Agreement and each Transaction Agreement to which it is a party and to consummate the Transactions to which it is a party. The execution and delivery by the Purchaser of this Agreement and each Transaction Agreement to which it is a party and the consummation by it of the Transactions to which it is a party have been duly authorized by all necessary corporate action on the part of the Purchaser. The Purchaser has duly executed and delivered this Agreement and each Transaction Agreement to which it is a party, and this Agreement and each Transaction Agreement to which it is a party, assuming the due authorization, execution and delivery thereof by the other parties thereto constitutes its legal, valid and binding obligation, enforceable against it in accordance with its terms. 24 SECTION 4.04. No Conflicts; Consents. (a) The execution and delivery by the Purchaser of this Agreement and each Transaction Agreement to which it is a party, do not, and the consummation of the Acquisition and the other Transactions to which it is a party and compliance with and performance of the terms hereof and thereof will not, conflict with, or result in any violation of or default (with or without notice or lapse of time, or both) under, or give rise to a right of termination, cancelation or acceleration of any obligation or to loss of a material benefit under, or to increased, additional, accelerated or guaranteed rights or entitlements of any person under, or result in the creation of any Lien upon any of the properties or assets of the Purchaser or any of its subsidiaries under, any provision of (i) the charter or organizational documents of the Purchaser or any of the Purchaser's subsidiaries, (ii) any material Contract to which the Purchaser or any of its subsidiaries is a party or by which any of their respective properties or assets is bound or (iii) subject to the filings and other matters referred to in Section 4.04(b), any material Judgment or material Law applicable to the Purchaser or any of its subsidiaries or their respective properties or assets, other than, in the case of clauses (ii) and (iii) above, any such items that, individually or in the aggregate, have not had and would not be reasonably likely to have, a material adverse effect on the Purchaser (with respect to the Purchaser, a "Purchaser Material Adverse Effect") (excluding for purposes of this Section 4.04(a) and the application of Section 7.03(a) hereto, clause (a)(iii) of the definition "material adverse effect"). (b) No Consent of, or registration, declaration or filing with any Governmental Entity is required to be obtained or made by or with respect to the Purchaser or any of its subsidiaries in connection with the execution, delivery and performance of this Agreement or any Transaction Agreement to which it is a party or the consummation of the Transactions to which the Purchaser is a party, other than (i) compliance with and filings under (A) the HSR Act, (B) the Japanese Anti-Monopoly Law, (C) other Antitrust Laws, (D) the FEL, (E) the rules and regulations of the TSE, (F) the JCL and (G) the CRL, (ii) the filing with the U.S. SEC of (A) the U.S. Information Statement and (B) such reports under the Exchange Act as may be required in connection with the Merger Agreement and the other Transaction Agreements, the Acquisition and the other Transactions, (iii) the filing with the Bureau of the Information Statement as may be required under the SEL in connection with this Agreement, the other Transaction Agreements, the Acquisition and the other Transactions, (iv) the filing of a certificate of merger in connection with the Merger with the Secretary of State of the State of Delaware and appropriate documents with the relevant authorities of the other jurisdictions in which the Company is qualified to do business, (v) compliance with and such filings as may be required under applicable Environmental Laws, (vi) such filings as may be required in connection with the Taxes described in Section 6.06, (vii) filings under any applicable state takeover Law and (viii) such other items (A) required solely by reason of the participation of the Company (as opposed to any third party) in the Transactions or (B) that, individually or in the aggregate, have not had and would not be reasonably likely to have a Company Material Adverse Effect (excluding for purposes of this Section 4.04(b) and the 25 application of Section 7.03(a) hereto, clause (a)(iii) of the definition "material adverse effect"). SECTION 4.05. Information Supplied. None of the information supplied or to be supplied by the Purchaser for inclusion or incorporation by reference in the Information Statement will contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they are made, not misleading. SECTION 4.06. Brokers. No broker, investment banker, financial advisor or other person, other than Lazard Freres & Co. LLC, the fees and expenses of which will be paid by Mercury, is entitled to any broker's, finder's, financial advisor's or other similar fee or commission in connection with the Acquisition and the other Transactions based upon arrangements made by or on behalf of the Purchaser. ARTICLE V Covenants Relating to Conduct of Business ----------------------------------------- SECTION 5.01. Conduct of Business. (a) Conduct of Business by the Company. Except for matters set forth in the Company Disclosure Letter or otherwise expressly permitted by this Agreement, from the date of this Agreement to the Closing the Company shall, and shall cause each Company Subsidiary to, conduct its business in the usual, regular and ordinary course in substantially the same manner as previously conducted and, to the extent consistent therewith, use all commercially reasonable efforts to preserve intact its current business organization, keep available the services of its current officers and employees and keep its relationships with customers, suppliers, licensors, licensees, distributors and others having business dealings with them. In addition, and without limiting the generality of the foregoing, except for matters set forth in the Company Disclosure Letter or otherwise expressly permitted by this Agreement, from the date of this Agreement to the Closing, the Company shall not, and shall not permit any Company Subsidiary to, do any of the following without the prior written consent of the Purchaser: (i) (A) declare, set aside, allot or pay any dividends on, or make any other distributions in respect of, any of its capital stock, other than dividends and distributions by a direct or indirect wholly owned subsidiary of the Company to its parent, (B) split, combine or reclassify any of its capital stock or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for shares of its capital stock, or (C) purchase, redeem or otherwise acquire any shares of capital stock of the Company or any Company 26 Subsidiary or any other securities thereof or any rights, warrants or options to acquire any such shares or other securities; (ii) issue, deliver, sell or grant (A) any shares of its capital stock, (B) any Voting Company Debt or other voting securities, (C) any securities convertible into or exchangeable for, or any options, warrants or rights to acquire, any such shares, Voting Company Debt, voting securities or convertible or exchangeable securities or (D) any "phantom" stock, "phantom" stock rights, stock appreciation rights, restricted stock units or stock-based performance units, other than the issuance of the Company Common Stock and Company Preferred Stock issued in connection with the Transactions (including to RHJI pursuant to the Equity Commitment) and the issuance of Company Common Stock upon the exercise of Company Stock Options outstanding on the date of this Agreement and in accordance with their present terms; (iii) amend its articles of incorporation, by-laws or other comparable charter or organizational documents, other than the Company Charter Amendment; (iv) acquire or agree to acquire or transfer or agree to transfer by merging or consolidating with, or by corporate separation, stock-for-stock exchange, stock transfer, business assignment or receiving assignment of business or by purchasing a substantial equity interest in or substantial portion of the assets of, or by any other manner, any business or any corporation, partnership, joint venture, association or other business organization or division thereof that would be material to the Company and the Company Subsidiaries, taken as a whole; (v) make any change in accounting methods, principles or practices materially affecting the reported consolidated assets, liabilities or results of operations of the Company, except insofar as may have been required by a change in GAAP; (vi) incur any indebtedness for borrowed money or guarantee any such indebtedness of another person, issue or sell any debt securities or warrants or other rights to acquire any debt securities of the Company or any Company Subsidiary, guarantee any debt securities of another person, enter into any "keep well" or other agreement to maintain any financial statement condition of another person or enter into any arrangement having the economic effect of any of the foregoing, except for short-term borrowings incurred in the ordinary course of business consistent with past practice, the Bridge Financing and such other long term indebtedness, guarantees, debt securities or other agreements or arrangements that would not be reasonably likely to have a Company Material Adverse Effect; (vii) make or change any material Tax election; or 27 (viii) authorize any of, or commit or agree to take any of, the foregoing actions. (b) Advice of Changes. The Company shall promptly advise the Purchaser orally and in writing of any change or event that has or could be reasonably likely to have a Company Material Adverse Effect. (c) Periodic Reports. In connection with the continuing operation of the business of the Company and the Company Subsidiaries between the date of this Agreement and the Closing and to the extent permitted by Antitrust Laws (as defined in Section 6.02(c)), the Company shall use commercially reasonable efforts to report in good faith on a regular basis to the representatives of the Purchaser to report material operational developments and the general status of ongoing operations pursuant to procedures reasonably requested in writing by the Purchaser; provided that the consultation required by this Section 5.01(d) shall be conducted in a manner so as not to disrupt in any material respect the business of the Company and the Company Subsidiaries; provided further that the Company and the Company Subsidiaries shall not report to the Purchaser or its representatives any non-public information related to output, pricing or any other competitively-sensitive matter. The Purchaser acknowledges that it shall not have any approval rights under this Section 5.01(c). The Company acknowledges that any such reports shall not constitute a waiver by the Purchaser of any rights it may have under this Agreement and that the Purchaser shall not have any liability or responsibility for any actions of the Company, any Company Subsidiary or any of their respective directors or officers with respect to matters that are the subject of such reports. All information exchanged pursuant to this Section 5.01(c) shall be subject to the Confidentiality Agreement (as defined in Section 6.02). For the avoidance of doubt, the Company shall not be required to provide any information pursuant to this Section 5.01(c) to the extent such information is not required to be provided pursuant to Section 6.02. SECTION 5.02. No Solicitation. (a) Prior to the Closing Date, the Company shall not, nor shall it authorize or permit any Company Subsidiary to, nor shall it authorize or permit any officer, director or employee of, or any investment banker, attorney or other advisor or representative (each, a "Representative" and collectively, "Representatives") of, the Company or any Company Subsidiary to, (i) directly or indirectly solicit, initiate or encourage the submission of, any Company Takeover Proposal (as defined in Section 5.02(e)), (ii) enter into any agreement with respect to any Company Takeover Proposal or (iii) directly or indirectly participate in any discussions or negotiations regarding, or furnish to any person any information with respect to, or take any other action to facilitate any inquiries or the making of any proposal that constitutes, or may reasonably be expected to lead to, any Company Takeover Proposal. Without limiting the foregoing, it is agreed that any violation of the restrictions set forth in the preceding sentence by any Representative or affiliate of the Company or any Company Subsidiary shall 28 be deemed to be a breach of this Section 5.02(a) by the Company. The Company shall, and shall cause its Representatives to, cease immediately all discussions and negotiations regarding any proposal that constitutes, or may reasonably be expected to lead to, a Company Takeover Proposal. (b) Prior to the Closing Date, the Company promptly shall advise the Purchaser orally and in writing of any Company Takeover Proposal or any inquiry with respect to or that could reasonably be expected to lead to any Company Takeover Proposal and the identity of the person making any such Company Takeover Proposal or inquiry including any change to the material details of any such Company Takeover Proposal or inquiry. The Company shall (i) keep the Purchaser fully informed of the status including any change to the material details of any such Company Takeover Proposal or inquiry and (ii) provide to the Purchaser as soon as practicable after receipt or delivery thereof with copies of all material correspondence and other written material sent or provided to the Company from any third party in connection with any Company Takeover Proposal or sent or provided by the Company to any third party in connection with any Company Takeover Proposal. (c) Nothing contained in this Section 5.02 shall prohibit the Company from making any required disclosure to the Company's stockholders if, in the good faith judgment of the Company Board, after consultation with outside counsel, failure so to disclose would be inconsistent with its obligations under applicable Law. (d) For purposes of this Agreement: "Company Takeover Proposal" means (i) any proposal or offer for a merger, consolidation, dissolution, recapitalization or other business combination involving the Company, (ii) any proposal for the issuance by the Company of over 20% of its equity securities as consideration for the assets or securities of another person or (iii) any proposal or offer to acquire in any manner, directly or indirectly, over 20% of the equity securities or consolidated total assets of the Company, in each case other than the Transactions and the Equity Commitment and Financing. ARTICLE VI Additional Agreements --------------------- SECTION 6.01. Preparation of Information Statement. (a) The Company shall, as soon as practicable following the date of this Agreement, prepare and file with the Bureau the Information Statement to be provided to the Company's stockholders in preliminary form, and each of the Company and the Purchaser shall use its commercially reasonable efforts to respond as promptly as 29 practicable to any comments of the Bureau, or its upper body, the Finance Services Agency (the "FSA") with respect thereto. The Company shall notify the Purchaser promptly of the receipt of any comments from the Bureau, the FSA or their staff and of any request by the Bureau or the FSA or their staff for amendments or supplements to the Information Statement or on any other Company Disclosure Document or for additional information and shall supply the Purchaser with copies of all correspondence between the Company or any of its representatives, on the one hand, and the Bureau, the FSA or their staff, on the other hand, with respect to the Information Statement or any other Company Disclosure Document. If at any time prior to receipt of the Company Stockholder Approval there shall occur any event that should be set forth in an amendment or supplement to the Information Statement, the Company shall promptly prepare and mail to its stockholders such an amendment or supplement. The Company shall not mail any Information Statement, or any amendment or supplement thereto, to which the Purchaser reasonably objects. The Company shall use its commercially reasonable efforts to cause the Information Statement to be mailed to the Company's stockholders as promptly as practicable after filing with the Bureau. Notwithstanding the foregoing, prior to filing or mailing the Information Statement or any other Company Disclosure Document (or any amendment or supplement thereto) or responding to any comments of the Bureau and the FSA with respect thereto, the Company (i) shall provide the Purchaser an opportunity to review and comment on such document or response and (ii) shall include in such document or response all reasonable comments proposed by the Purchaser. (b) Special Stockholder Meetings. The Company shall, as soon as practicable following the date of this Agreement, duly call, give notice of, convene and hold (i) a meeting of the Company Common Stock stockholders, (ii) a meeting of the Company Class A Preferred Stock stockholders, (iii) a meeting of the Company Class B Preferred Stock stockholders and (iv) a general stockholders meeting of the Company (the "Company Stockholders Meetings") for the purpose of (A) seeking the Company Stockholder Approval and (B) electing as directors to the Company Board the persons designated as such in accordance with Section 2(e) of the Stockholders Agreement. The Company shall, through the Company Board, recommend to its stockholders that they give the Company Stockholder Approval, except to the extent that the Company Board shall have withdrawn or modified its approval or recommendation of the Company Charter Amendment after the Company Board shall have determined in good faith, after consultation with outside counsel, that the failure to do so would be inconsistent with its obligations under applicable Law. SECTION 6.02. Access to Information; Confidentiality. The Company shall, and shall cause each of its subsidiaries to, afford to the Purchaser and to the Purchaser's officers, employees, accountants, counsel, financial advisors and other representatives, reasonable access during normal business hours during the period prior to the Closing (as long as such access is not unreasonably disruptive to the business of the Company or its subsidiaries) to 30 all their respective properties, books, contracts, commitments, personnel and records and, during such period, the Company shall, and shall cause each of its subsidiaries to, furnish promptly to the Purchaser (a) a copy of each report, schedule, registration statement and other document filed by it during such period pursuant to the requirements of Japanese securities laws and (b) all other information concerning its business, properties and personnel as the Purchaser may reasonably request; provided, however, that either party may withhold (i) any document or information that is subject to the terms of a confidentiality agreement with a third party, (ii) such portions of documents or information relating to output, pricing or other matters that are highly sensitive if the exchange of such documents (or portions thereof) or information, as determined by such party's counsel, would reasonably be expected to raise antitrust concerns for such party (or any of its affiliates) or (iii) such portions of documents or information that would reasonably be expected to jeopardize any attorney-client privilege or contravene any Law or fiduciary duty (provided that each party shall in good faith seek and implement a reasonable alternative to provide Purchaser's counsel with access to such document or information. All information exchanged pursuant to this Section 6.02 shall be subject to the terms of the confidentiality agreement dated September 29, 2005, between RHJI and Mercury (the "Confidentiality Agreement") as if the Purchaser was a party thereto with the same obligations thereunder as Mercury. SECTION 6.03. Commercially Reasonable Efforts; Notification. (a) Upon the terms and subject to the conditions set forth in this Agreement, each of the parties shall use its commercially reasonable efforts to take, or cause to be taken, all actions, and to do, or cause to be done, and to assist and cooperate with the other parties in doing, all things necessary, proper or advisable to consummate and make effective, in the most expeditious manner practicable, the Acquisition and the other Transactions, including (i) the obtaining of all necessary actions or nonactions, waivers, consents and approvals from Governmental Entities and the making of all necessary registrations and filings (including filings with Governmental Entities, if any) and the taking of all reasonable steps as may be necessary to obtain an approval or waiver from, or to avoid an action or proceeding by, any Governmental Entity, (ii) the obtaining of all necessary consents, approvals or waivers from third parties, (iii) the defending of any lawsuits or other legal proceedings, whether judicial or administrative, challenging this Agreement or any other Transaction Agreement or the consummation of the Transactions, including seeking to have any stay or temporary restraining order entered by any court or other Governmental Entity vacated or reversed and (iv) the execution and delivery of any additional instruments necessary to consummate the Transactions and to fully carry out the purposes of the Transaction Agreements. Nothing in this Agreement shall be deemed to require any party to waive any substantial rights or agree to any substantial limitation on its operations or to dispose of any significant asset or collection of assets. Notwithstanding the foregoing, the Company and its Representatives shall not be prohibited under this Section 6.03(a) from taking any action permitted by 31 Section 5.02(b). Subject to applicable Law relating to the exchange of information, the Company and the Purchaser and their respective counsel shall have the right to review in advance, and to the extent practicable each shall consult the other on, any filing made with, or written materials submitted to, any Governmental Entity in connection with the Acquisition and the other Transactions. The Company and the Purchaser shall provide the other party and its counsel with the opportunity to participate in any meeting with any Governmental Entity in respect of any filing, investigation or other inquiry in connection with the Acquisition or the other Transactions. (b) Prior to Closing, the Company shall give prompt notice to the Purchaser, and the Purchaser shall give prompt notice to the Company, of (i) any representation or warranty made by it contained in this Agreement or any Transaction Agreement that is qualified as to materiality becoming untrue or inaccurate in any respect or any such representation or warranty that is not so qualified becoming untrue or inaccurate in any material respect or (ii) the failure by it to comply with or satisfy in any material respect any covenant, condition or agreement to be complied with or satisfied by it under this Agreement; provided, however, that no such notification shall be deemed to be a waiver or cure of any such breach or failure to comply or affect the representations, warranties, covenants or agreements of the parties or the conditions to the obligations of the parties under this Agreement or the Transaction Agreements. (c) Nothing in Section 6.03(a) shall require the Purchaser to dispose of any of its assets or to limit its freedom of action with respect to any of its businesses, or to consent to any disposition of the Company's assets or limits on the Company's freedom of action with respect to any of its businesses, or to commit or agree to any of the foregoing, and nothing in Section 6.03(a) shall authorize the Company to commit or agree to any of the foregoing, to obtain any consents, approvals, permits or authorizations to remove any impediments to the Acquisition relating to the HSR Act, any Japanese competition Law or other antitrust, competition or premerger notification, trade regulation law, regulation or order ("Antitrust Laws") or to avoid the entry of, or to effect the dissolution of, any injunction, temporary restraining order or other order in any suit or proceeding relating to Antitrust Laws. (d) Nothing in this Section 6.03 shall require the Purchaser to (i) consent to any action or omission by the Company that would be inconsistent with Section 5.01 absent such consent or (ii) agree to amend or waive any provision of this Agreement. SECTION 6.04. Fees and Expenses. All fees and expenses incurred in connection with the Acquisition and the other Transactions shall be paid by the party incurring such fees or expenses, whether or not the Acquisition is consummated. SECTION 6.05. Public Announcements. The Purchaser, on the one hand, and the Company, on the other hand, shall consult with each other before 32 issuing, and provide each other the opportunity to review and comment upon, any press release or other public statements with respect to the Acquisition and the other Transactions and neither the Purchaser nor the Company shall issue any such press release or make any such public statement prior to such consultation, except as may be required by applicable Law, court process or by obligations pursuant to any listing agreement with any national securities exchange. SECTION 6.06. Transfer Taxes. All stock transfer, real estate transfer, documentary, stamp, recording and other similar Taxes (including interest, penalties and additions to any such Taxes) ("Transfer Taxes") incurred in connection with the Acquisition shall be paid by the Company, and the Purchaser shall reasonably cooperate with the Company in preparing, executing and filing any Tax Returns with respect to such Transfer Taxes. ARTICLE VII Conditions Precedent -------------------- SECTION 7.01. Conditions to Each Party's Obligation To Effect The Acquisition. The respective obligation of each party to effect the Acquisition is subject to the satisfaction or waiver on or prior to the Closing Date of the following conditions: (a) Company Stockholder Approval. The Company shall have obtained the Company Stockholder Approval. (b) Antitrust. Any waiting period (and any extension thereof) applicable to the Acquisition under the Japanese Anti-Monopoly Law shall have been terminated or shall have expired. Any consents, approvals and filings under any foreign Antitrust Law of any country, the absence of which would prohibit the consummation of the Acquisition or would be reasonably likely to have a Company Material Adverse Effect, shall have been obtained or made; provided, however, that prior to asserting this condition, subject to Section 6.03, the applicable party shall have used its commercially reasonable efforts to obtain or make such consents, approvals and filings. (c) No Injunctions or Restraints. No temporary judgment issued by any court of competent jurisdiction or other law preventing the consummation of the Acquisition shall be in effect; provided, however, that prior to asserting this condition, subject to Section 6.03, the applicable party shall have used its commercially reasonable efforts to prevent the entry of any such injunction or other order and to appeal as promptly as possible any such judgment that may be entered. 33 (d) Merger Agreement. The Company, Acquisition Sub and Mercury shall have consummated the transactions contemplated by the Merger Agreement without the amendment, modification or waiver in any material respect of any material term or condition thereof. (e) Other Stock Purchase Agreements. The transactions contemplated by each of the Other Stock Purchase Agreements shall have been consummated without the amendment, modification or waiver in any material respect of any material term or condition thereof. (f) Stockholders Agreement. The Stockholders Agreement shall have become effective and remain in full force and effect. (g) Japanese Regulatory. Any waiting periods (and any extensions thereof) applicable to the Acquisition under the FEL, SEL and JCL shall have been terminated or shall have expired. (h) Financing. The Company and Acquisition Sub shall have obtained the proceeds contemplated by the Financing or the Alternative Financing (as defined in the Merger Agreement) and the proceeds of the Equity Commitment; provided, however, that prior to asserting this condition, the applicable party shall have complied in all material respects with its respective obligations under Section 6.11 of the Merger Agreement. (i) Approval for Listing. The Shares shall have been approved for listing on the TSE and the next business day following the Closing shall be listed thereon; provided, however, that prior to asserting this condition, subject to Section 6.03, the applicable party shall have used its commercially reasonable efforts to obtain such approval and listing. (j) Company Stock Purchase Agreement. The transactions contemplated by the Company Stock Purchase Agreement shall have been consummated without the amendment, modification or waiver in any material respect of any material term or condition thereof. (k) Appointment of Directors. The persons designated as directors in accordance with Section 2(e) of the Stockholders Agreement shall have been elected to the Company Board. SECTION 7.02. Conditions to Obligations of the Purchaser. The obligations of the Purchaser to effect the Acquisition are further subject to the following conditions: (a) Representations and Warranties. The representations and warranties of the Company in this Agreement (other than those set forth in Sections 3.01, 3.03 and 3.04) shall be true and correct, as of the date of this Agreement and 34 as of the Closing Date as though made on the Closing Date, except to the extent such representations and warranties expressly relate to an earlier date (in which case such representations and warranties shall be true and correct, on and as of such earlier date), other than for such failures to be true and correct that, individually or in the aggregate, have not had and would not be reasonably likely to have a Company Material Adverse Effect (it being agreed that for purposes of determining whether such representations and warranties shall be true and correct and applying the foregoing Company Material Adverse Effect qualifier, all such representations and warranties that already are qualified by reference to a Company Material Adverse Effect or other materiality qualifier shall be deemed to be not so qualified). The representations and warranties of the Company set forth in Sections 3.01, 3.03 and 3.04 that are qualified by a Company Material Adverse Effect or other materiality qualifier shall be true and correct, and those not so qualified shall be true and correct in all material respects, as of the date of this Agreement and as of the Closing Date as though made on the Closing Date, except to the extent such representations and warranties expressly relate to an earlier date (in which case such representations and warranties shall be true and correct, or true and correct in all material respects, as applicable, on and as of such earlier date). The Purchaser shall have received a certificate signed on behalf of the Company by the chief executive officer and the chief financial officer of the Company to such effect. (b) Performance of Obligations of the Company. The Company shall have performed in all material respects all obligations required to be performed by it under this Agreement at or prior to the Closing Date, and the Purchaser shall have received a certificate signed on behalf of the Company by the chief executive officer and the chief financial officer of the Company to such effect. (c) Absence of Company Material Adverse Effect. Since the date of this Agreement, there shall not have been any event, change, effect, development or state of facts that, individually or in the aggregate, has had or would be reasonably likely to have a Company Material Adverse Effect. SECTION 7.03. Condition to Obligation of the Company. The obligation of the Company to effect the Acquisition is further subject to the following conditions: (a) Representations and Warranties. The representations and warranties of the Purchaser in this Agreement shall be true and correct in all material respects, as of the date of this Agreement and as of the Closing Date as though made on the Closing Date, except to the extent such representations and warranties expressly relate to an earlier date (in which case such representations and warranties shall be true and correct in all material respects, on and as of such earlier date) and the Company shall have received a certificate signed on behalf of the Purchaser to such effect. (b) Performance of Obligations of Purchaser. The Purchaser shall have performed in all material respects all obligations required to be performed by it under this Agreement at or prior to the Closing Date, and the Company shall 35 have received a certificate signed on behalf of the Purchaser to such effect. (c) Company Lender Consent. The Company Facility Amendments shall have become effective on the terms and conditions contemplated in the Company Consent Letter. ARTICLE VIII Termination, Amendment and Waiver --------------------------------- SECTION 8.01. Termination. This Agreement may be terminated at any time prior to the Closing: (a) by mutual written consent of the Company and the Purchaser; (b) by either the Company or the Purchaser: (i) if the Acquisition is not consummated on or before March 1, 2007 (the "Outside Date"), unless the failure to consummate the Acquisition is the result of a willful and material breach of this Agreement by the party seeking to terminate this Agreement; provided, however, that the passage of such period shall be tolled for any part thereof during which any party shall be subject to a nonfinal order, decree, ruling or action restraining, enjoining or otherwise prohibiting the consummation of the Acquisition; (ii) if any Governmental Entity issues an order, decree or ruling or takes any other action permanently enjoining, restraining or otherwise prohibiting the Acquisition and such order, decree, ruling or other action shall have become final and nonappealable; (iii) if, upon the votes thereon at the duly held first round of meetings to obtain the Company Stockholder Approval, the Company Stockholder Approval is not validly obtained and, upon the votes thereon at the duly held second round of meetings to obtain the Company Stockholder Approval, the Company Stockholder Approval is not validly obtained; or (iv) if the Merger Agreement is terminated in accordance with its terms; 36 (c) by the Purchaser, if the Company breaches or fails to perform in any material respect any of its representations, warranties or covenants contained in any Transaction Agreement, which breach or failure to perform (A) would give rise to the failure of a condition set forth in Section 7.02(a) or 7.02(b), and (B) cannot be or has not been cured by the Outside Date (provided that the Purchaser is not then in willful and material breach of any representation, warranty or covenant contained in this Agreement); or (d) by the Company, if the Purchaser breaches or fails to perform in any material respect any of its representations, warranties or covenants contained in this Agreement, which breach or failure to perform (i) would give rise to the failure of a condition set forth in Section 7.03(a) or 7.03(b), and (ii) cannot be or has not been cured by the Outside Date (provided that the Company is not then in willful and material breach of any representation, warranty or covenant contained in this Agreement). SECTION 8.02. Effect of Termination. In the event of termination of this Agreement by either the Company or the Purchaser as provided in Section 8.01, this Agreement shall forthwith become void and have no effect, without any liability or obligation on the part of the Company or the Purchaser, other than Section 3.19, Section 4.06, the last sentence of Section 6.02, Section 6.04, this Section 8.02 and Article IX, which provisions shall survive such termination, and except to the extent that such termination results from the willful and material breach by a party of any representation, warranty or covenant set forth in this Agreement, in which case the aggrieved party shall be entitled to all remedies available at law or in equity. SECTION 8.03. Amendment. This Agreement may not be amended except by an instrument in writing signed by the Company and the Purchaser. SECTION 8.04. Extension; Waiver. At any time prior to the Closing, the Company and the Purchaser may (a) extend the time for the performance of any of the obligations or other acts of the other parties, (b) waive any inaccuracies in the representations and warranties contained in this Agreement or in any document delivered pursuant to this Agreement or (c) waive compliance with any of the agreements or conditions contained in this Agreement. Any agreement on the part of a party to any such extension or waiver shall be valid only if set forth in an instrument in writing signed by the Company or by the Purchaser on behalf of the Company or the Purchaser, as applicable. The failure of any party to this Agreement to assert any of its rights under this Agreement or otherwise shall not constitute a waiver of such rights. 37 ARTICLE IX General Provisions ------------------ SECTION 9.01. Nonsurvival of Representations and Warranties. None of the representations and warranties in this Agreement or in any instrument delivered pursuant to this Agreement shall survive the Closing, except for Section 3.03(b) which shall survive the Closing. This Section 9.01 shall not limit any covenant or agreement of the parties which by its terms contemplates performance after the Closing. SECTION 9.02. Notices. All notices, requests, claims, demands and other communications under this Agreement shall be in writing and shall be deemed given upon receipt by the parties at the following addresses (or at such other address for a party as shall be specified by like notice): (a) if to the Purchaser, to Heartland Industrial Partners, L.P. 55 Railroad Avenue Greenwich, CT 06830l Fax: (203) 861-2722 Attention: Daniel P. Tredwell with a copy to: Ellenoff Grossman & Schole LLP 370 Lexington Avenue New York, NY 10017-6503 Fax: (212) 370-7889 Attention: Douglas S. Ellenoff, Esq. Martin Bring, Esq. (b) if to the Company, to Asahi Tec Corporation 547-1 Horinouchi, Kikugawa City, Shizuoka 439-8651, Japan Fax: 81-537-36-4160 Attention: Suguru Kimura 38 with a copy to: Anderson Mori & Tomotsune Izumi Garden Tower 1-6-1, Roppongi, Minato-ku, Tokyo 106-6036, Japan Fax: (03) 6888-3067 Attention: Noritaka Niwano, Esq. with a copy to: RHJ International SA Avenue Louise 326 1050 Brussels Belgium Attention: Bob Ewers with a copy to: Cravath, Swaine & Moore LLP Worldwide Plaza 825 Eighth Avenue New York, NY 10019 Attention: Thomas E. Dunn, Esq.; and The Company promptly shall provide the Purchaser with a copy of each notice delivered under the Merger Agreement. SECTION 9.03. Definitions. For purposes of this Agreement: An "affiliate" of any person means another person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such first person. "business day" means any day other than a Saturday or Sunday, on which banks located in Tokyo or New York are not required or authorized by law to remain closed. "Company Stock Purchase Agreement" means the stock purchase agreement dated as of the date of this Agreement between Argon, the Purchasers listed on Schedule I thereto and the Purchasers' Representative. A "material adverse effect" on a party means (a) a material adverse effect on the business, assets, financial condition or results of operations of the party and its subsidiaries, taken as a whole except, in each case, to the extent arising or resulting from, or caused or attributable to, any of the following, individually or taken together: (i) general U.S., Japanese or global economic, political or market conditions to the extent not materially 39 disproportionately affecting the party and its subsidiaries, taken as whole, relative to other automotive industry participants in the party's geographic area, (ii) changes in applicable generally accepted accounting principles or Law, (iii) the public announcement of the Transactions, the consummation of the Transactions or the execution of the Transaction Agreements or (iv) acts of terrorism or war to the extent not materially disproportionately affecting the party and its subsidiaries, taken as whole, relative to other automotive industry participants in the party's geographic area, (b) a material adverse effect on the ability of the party to perform its obligations under this Agreement or the other Transaction Agreements to which it is a party or (c) a material adverse effect on the ability of the party to consummate the Transactions to which it is a party. A "person" means any individual, firm, corporation, partnership, company, limited liability company, trust, joint venture, association, Governmental Entity or other entity. A "subsidiary" of any person means another person, an amount of the voting securities, other voting ownership or voting partnership interests of which is sufficient to elect at least a majority of its board of directors or other governing body (or, if there are no such voting interests, 50% or more of the equity interests of which) is owned directly or indirectly by such first person. For the avoidance of doubt, in no event shall Mercury or any subsidiary of Mercury be deemed to be a subsidiary of the Company for any purpose of this Agreement (including after giving effect to the Merger). "Transaction Agreements" means this Agreement, the Company Voting Agreement, the Merger Agreement, the Company Stock Purchase Agreement, the Stockholders Agreement and the Other Stock Purchase Agreements and documents delivered in connection with the foregoing. SECTION 9.04. Interpretation. When a reference is made in this Agreement to a Section, such reference shall be to a Section of this Agreement unless otherwise indicated. The table of contents and headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. Whenever the words "include", "includes" or "including" are used in this Agreement, they shall be deemed to be followed by the words "without limitation". SECTION 9.05. Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any rule or Law, or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an 40 acceptable manner to the end that transactions contemplated hereby are fulfilled to the extent possible. SECTION 9.06. Counterparts. This Agreement may be executed in one or more counterparts, all of which shall be considered one and the same agreement and shall become effective when one or more counterparts have been signed by each of the parties and delivered to the other parties. SECTION 9.07. Entire Agreement; No Third-Party Beneficiaries. This Agreement and the Transaction Agreements, taken together with the Company Disclosure Letter, (a) constitute the entire agreement, and supersede after the date of this Agreement all prior agreements and understandings, both written and oral, among the parties with respect to the Transactions (other than the Confidentiality Agreement) and (b) are not intended to confer upon any person other than the parties any rights or remedies. SECTION 9.08. Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York, regardless of the laws that might otherwise govern under applicable principles of conflicts of laws thereof, except to the extent the laws of Japan are mandatorily applicable to the Acquisition. SECTION 9.09. Assignment. Neither this Agreement nor any of the rights, interests or obligations under this Agreement shall be assigned, in whole or in part, by operation of law or otherwise by any of the parties without the prior written consent of the other parties. Any purported assignment without such consent shall be void. Subject to the preceding sentences, this Agreement will be binding upon, inure to the benefit of, and be enforceable by, the parties and their respective successors and assigns. SECTION 9.10. Enforcement. The parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement or any Transaction Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement or any Transaction Agreement and to enforce specifically the terms and provisions of this Agreement and each other Transaction Agreement in any New York state court, any Federal court located in the State of New York or the State of Delaware or in any Delaware state court, this being in addition to any other remedy to which they are entitled at law or in equity. In addition, each of the parties hereto (a) consents to submit itself to the personal jurisdiction of any New York state court, any Federal court located in the State of New York or the State of Delaware or in any Delaware state court, in the event any dispute arises out of this Agreement, any Transaction Agreement or any Transaction, (b) agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from any such court, (c) agrees that it will not bring any action relating to this Agreement or any other Transaction Agreement or any Transaction in any court other than any New York state court, any Federal court sitting in the State of New York or the 41 State of Delaware or any Delaware state court and (d) waives any right to trial by jury with respect to any action related to or arising out of this Agreement or any other Transaction Agreement or any other Transaction. SECTION 9.11. Agreement and Waiver of Certain Rights. (a) The Purchaser, by the execution and delivery of this Agreement, hereby waives in relation to the Merger, its rights under Section 262 of the Delaware General Corporation Law ("Section 262") in connection with its Appraisal Shares (as defined in the Merger Agreement) including any rights to demand appraisal of such Appraisal Shares, and hereby consents and agrees, in relation to the Merger, not to exercise any rights under Section 262, including any appraisal rights, with respect to such Appraisal Shares. (b) The Purchaser hereby consents, with respect to the limitations and approval and consent rights set forth in the Shareholders Agreement (the "Mercury Shareholders Agreement") by and among Mascotech, Inc., Masco Corporation, Richard Manoogian, Richard and Jane Manoogian Foundation, the Heartland Entities listed on the signature pages thereto and the HIP Co-Investors listed on the signature pages thereto, dated as of November 28, 2000, to Mercury's participation in the Transactions and the TM Distribution (subject to the payment date of the TM Distribution being on or after the Closing Date and being made conditional on the Closing). The Purchaser further consents and acknowledges that at the Effective Time the Mercury Shareholders Agreement shall terminate and be of no force and effect. (c) Subject to the consummation of the Merger, the Purchaser, by the execution and delivery of this Agreement, (i) hereby acknowledges, consents to and agrees that the TM Distribution (as defined in the Merger Agreement) shall be declared and made without registration under the Securities Act or the Exchange Act of the securities distributed thereby, that the TM Distribution shall be made on the terms set forth in the Merger Agreement (subject to the payment date of the TM Distribution being on or after the Closing Date and being made conditional on the Closing) and that it waives (subject to the foregoing) any remedy of rescission or any other remedies against Mercury or the Company in connection therewith and (ii) hereby consents and agrees to the declaration and consummation of the TM Distribution (subject to the payment date of the TM Distribution being on or after the Closing Date and being made conditional on the Closing). 42 IN WITNESS WHEREOF, the Company and the Purchaser have duly executed this Agreement, all as of the date first written above. ASAHI TEC CORPORATION, by: ------------------------- Name: Title: METALDYNE INVESTMENT FUND I, LLC, by: ----------------------------------- Name: Title: HIP SIDE-BY-SIDE PARTNERS, L.P., by: HEARTLAND INDUSTRIAL ASSOCIATES, LLC Its: General Partner by: ----------------------------------- Name: Title: METALDYNE INVESTMENT FUND II, LLC, by: -------------------------------------- Name: Title: EX-99 3 metalagmt.txt EXHIBIT B ================================================================================ SHAREHOLDERS AGREEMENT By and Among MASCOTECH, INC. MASCO CORPORATION RICHARD MANOOGIAN RICHARD AND JANE MANOOGIAN FOUNDATION THE HEARTLAND ENTITIES LISTED ON THE SIGNATURE PAGES HERETO THE HIP CO-INVESTORS LISTED ON THE SIGNATURE PAGES HERETO ----------------------------------------------- Dated as of November 28, 2000 ----------------------------------------------- ================================================================================ TABLE OF CONTENTS Page ---- ARTICLE I DEFINITIONS; RULES OF CONSTRUCTION SECTION 1.01. Definitions.............................................1 SECTION 1.02. Rules of Construction..................................10 ARTICLE II REPRESENTATIONS AND WARRANTIES SECTION 2.01. Authority; Enforceability..............................10 SECTION 2.02. No Breach..............................................11 SECTION 2.03. Consents...............................................11 SECTION 2.04. Share Ownership........................................11 ARTICLE III SHARE TRANSFERS SECTION 3.01. Restrictions on Transfer...............................12 SECTION 3.02. Exceptions to Restrictions.............................12 SECTION 3.03. Improper Transfer......................................13 SECTION 3.04. Restrictive Legend.....................................13 ARTICLE IV RIGHTS OF CERTAIN SHAREHOLDERS SECTION 4.01. Rights of First Offer..................................14 SECTION 4.02. Tag-Along Rights.......................................15 SECTION 4.03. Drag-Along Rights......................................17 SECTION 4.04. Information............................................18 SECTION 4.05. Preemptive Rights......................................20 SECTION 4.06. Board of Directors.....................................23 SECTION 4.07. Right to Observer......................................25 SECTION 4.08. Consultation Right.....................................25 SECTION 4.09. Approval Rights........................................26 SECTION 4.10. Transactions with Affiliates...........................26 -i- Page ---- ARTICLE V REGISTRATION RIGHTS SECTION 5.01. Company Registration....................................27 SECTION 5.02. Demand Registration Rights..............................29 SECTION 5.03. Registration Procedures.................................32 SECTION 5.04. Registration Expenses...................................37 SECTION 5.05. Indemnification.........................................38 SECTION 5.06. 1934 Act Reports........................................40 SECTION 5.07. Holdback Agreements.....................................41 SECTION 5.08. Participation in Registrations..........................42 SECTION 5.09. Remedies................................................42 SECTION 5.10. Other Registration Rights...............................42 SECTION 5.11. Rule 144................................................42 ARTICLE VI RIGHTS OF HOLDERS OF CLASS A PREFERRED STOCK SECTION 6.01. Series A Preferred Stock................................43 SECTION 6.02. Management Fee..........................................43 ARTICLE VII MISCELLANEOUS SECTION 7.01. Notices.................................................43 SECTION 7.02. Binding Effect; Benefits; Entire Agreement..............44 SECTION 7.03. Waiver..................................................44 SECTION 7.04. Amendment...............................................44 SECTION 7.05. Assignability...........................................45 SECTION 7.06. Applicable Law..........................................45 SECTION 7.07. Specific Performance....................................45 SECTION 7.08. Severability............................................45 SECTION 7.09. Additional Securities Subject to Agreement..............45 SECTION 7.10. Name Change.............................................46 SECTION 7.11. Section and Other Headings..............................46 SECTION 7.12. Counterparts............................................46 SECTION 7.13. Termination of Certain Provisions.......................46 SECTION 7.14. ERISA Matters...........................................46 SECTION 7.15. Regulatory Cooperation..................................47 -ii- Page ---- SECTION 7.16. Publicity...............................................47 SECTION 7.17. Expenses................................................47 -iii- SHAREHOLDERS AGREEMENT THIS AGREEMENT (the "Agreement"), dated as of November 28, 2000, by and among MASCOTECH, INC. a Delaware corporation (the "Company"), Richard Manoogian ("IS"), the Richard and Jane Manoogian Foundation ("Foundation Shareholder" and, together with IS, "RM"), MASCO CORPORATION, a Delaware corporation (together with RM, the "Rollover Investors"), the HEARTLAND ENTITIES (as defined herein), LONG POINT CAPITAL FUND, L.P. and LONG POINT CAPITAL PARTNERS L.L.C. (collectively "Long Point"), CRM 1999 ENTERPRISE FUND, LLC ("Cramer" and with Long Point collectively the "Masco Transferees" or individually as a "Masco Transferee") and the entities identified as HIP CO-INVESTORS on the signature pages hereof (the HIP Co-Investors (including, without limitation, the Masco Transferees), the Rollover Investors, Sponsor and each Person executing a Joinder Agreement are collectively referred to herein as the "Shareholders" and individually as a "Shareholder"). WHEREAS, the Company and Riverside Acquisition Corporation (formerly Riverside Company LLC), a Delaware corporation ("Riverside") and an affiliate of Sponsor, have entered into a Recapitalization Agreement, dated as of August 1, 2000, as amended by Amendment No. 1 thereto, dated as of October 23, 2000, and Amendment No. 2 thereto, dated as of November 28, 2000 (the "Recapitalization Agreement"), which provides for, among other things, the merger of Riverside with and into the Company (the "Recapitalization Merger"). WHEREAS, as a result of and in connection with the Recapitalization Merger, each Shareholder will own the number of shares of common stock of the Company, $1.00 par value (the "Common Stock"), set forth on Schedule 2.04 hereto and Company Shareholder will own 361,001 shares of class A preferred stock of the Company, $1.00 par value (the "Class A Preferred Stock"). WHEREAS, the parties hereto desire to enter into this agreement to provide for certain rights and restrictions with respect to the Common Stock. NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, the parties mutually agree as follows: ARTICLE I DEFINITIONS; RULES OF CONSTRUCTION SECTION 1.01. Definitions. The following terms, as used herein, have the following meanings: -2- "Adjustments" means adjustments to the number of shares of Common Stock outstanding as a result of a stock split, stock dividend, reclassification, subdivision or reorganization, recapitalization or similar event. "Advice" see Section 5.03(p). "Affiliate" of any specified Person means any other Person directly or indirectly controlling, controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, "control" when used with respect to any Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms "controlling" and "controlled" have meanings correlative to the foregoing. "Agreement" see the recitals to this Agreement. "Assignee" see Section 4.01(c). "business day" means each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which banking institutions in the City of New York are authorized or obligated by law or executive order to close. "Capital Stock" means, with respect to any Person, except as otherwise provided in Section 4.05, any and all shares, interests, participations, rights in or other equivalents (however designated) of such Person's capital stock, and any rights (other than debt securities convertible into capital stock), warrants or options exchangeable for or convertible into such capital stock. "Class A Preferred Stock" see the recitals to this Agreement. "Commission" means the Securities and Exchange Commission. "Common Stock" see the recitals to this Agreement. "Company" see the recitals to this Agreement. "Company Option Period" see Section 4.01(b). "Company Shareholder" means Masco Corporation, a Delaware corporation, provided that upon the transfer of all of Masco Corporation's shares of Common Stock to Masco Capital Corporation, a wholly-owned subsidiary of Masco Corporation, Masco Capital Corporation shall also be deemed Company Shareholder for all purposes of this Agreement; provided that Masco Capital Corporation executes a Joinder Agreement. -3- "CSFB" means, collectively, the CSFB Plan Partner and the CSFB Funds, or the CSFB Plan Partner acting on behalf of such other Persons. "CSFB Director" see Section 4.06(a)(ii)(c). "CSFB Funds" means, collectively, Credit Suisse First Boston Equity Partners (Bermuda), L.P., Credit Suisse First Boston U.S. Executive Advisors, L.P., EMA Partners Fund 2000, L.P. and EMA Private Equity Fund 2000, L.P. "CSFB Plan Partner" means Credit Suisse First Boston Equity Partners, L.P. "Demand Holders" means any of Company Shareholder (on behalf of itself and its Direct Permitted Transferees), RM (on behalf of himself, itself and his or its Direct Permitted Transferees), a QI Demand Holder (on behalf of itself and its Direct Permitted Transferees), CSFB (on behalf of itself and its Direct Permitted Transferees and other Transferees to the extent permitted by Section 5.02(g)) or Sponsor (on behalf of itself and its Direct Permitted Transferees). "Demand Registration" see Section 5.02(a). "Direct Permitted Transferee" means: (i) with respect to any Shareholder who is a natural person, (1) the spouse or any lineal descendant (including by adoption and stepchildren) of such Shareholder, (2) any trust of which such Shareholder is the trustee and which is established solely for the benefit of any of the foregoing individuals or (3) any partnership, all of the general partner(s) and limited partner(s) (if any) of which are one or more Persons identified in this clause (i); (ii) with respect to Sponsor, any Affiliate of Sponsor; (iii) with respect to Company Shareholder, any controlled Affiliate of Company Shareholder (including any wholly-owned subsidiary of Company Shareholder); (iv) with respect to any Institutional Shareholder, any Affiliate of such Institutional Shareholder; (v) with respect to Foundation Shareholder, any Affiliate of Foundation Shareholder; (vi) with respect to MetLife, (a) any Affiliates of MetLife or (b) Portfolio Advisors, LLC or any controlled Affiliate of Portfolio Advisors, LLC; and -4- (vii) with respect to any Shareholder, any institutional lender to which such Shareholder pledges or grants a security interest in shares of Common Stock in a bona fide transaction effected in good faith, provided that (x) such pledgee executes a Joinder Agreement and (y) prior to any subsequent foreclosure or sale of such shares or any Transfer resulting from such foreclosure is effected, the provisions of Section 4.01 must be satisfied. "Eligible Offering" see Section 4.05(a). "First Option" see Section 4.01(b). "First Union Capital Partners" means First Union Capital Partners, LLC. "Foundation Shareholder" see the recitals to this Agreement. "GAAP" means United States generally accepted accounting principles consistently applied throughout the specified period. "Heartland Entities" means Heartland Industrial Partners, L.P., Heartland Industrial Partners (FF), L.P., Heartland Industrial Partners (E1), L.P., Heartland Industrial Partners (K1), L.P., Heartland Industrial Partners (C1), L.P. and Direct Permitted Transferees of any of the foregoing. "HIP Co-Investor" means (i) each Shareholder that is a limited partner, or an Affiliate of a limited partner, in Sponsor or in any other fund or investment vehicle established or managed by Sponsor or an Affiliate of Sponsor, (ii) CSFB, (iii) each Masco Transferee and (iv) MetLife; provided that, upon the Transfer by MetLife of all of its shares of Common Stock to Portfolio Advisors, LLC or any controlled Affiliate of Portfolio Advisors, LLC in accordance with Section 3.02(a) of this Agreement, Portfolio Advisors, LLC or such controlled Affiliate of Portfolio Advisors, LLC shall be deemed to be a HIP Co-Investor under this Agreement. "Holder" means any Demand Holder or Incidental Demand Holder. "Incidental Demand Holder" see Section 5.02. "Initial Public Offering" means either (x) an underwritten initial public offering of the Company pursuant to an effective registration statement filed under the 1933 Act (excluding registration statements filed on Form S-8, or any similar successor form or another form used for a purpose similar to the intended use for such forms) or (y) the listing of the Common Stock on a national securities exchange or authorization for quotation on the Nasdaq National Market System. -5- "Institutional Shareholder" means any Shareholder that is not a natural person (other than Company Shareholder, Foundation Shareholder or Sponsor). "Investors" see Section 4.01(a). "Investor's Notice" see Section 4.01(a). "IS" see the recitals to this Agreement. "Joinder Agreement" means a joinder agreement, a form of which is attached hereto as Exhibit A. "Masco Transferees" see the recitals to this Agreement. "Material Event" see Section 4.09(a). "MetLife" means Metropolitan Life Insurance Company. "1933 Act" means the Securities Act of 1933. "1934 Act" means the Securities Exchange Act of 1934, as amended. "Observer" see Section 4.07. "Offered Shares" see Section 4.01(a). "Permitted Transferee" means: (i) with respect to any Shareholder who is a natural person, (1) the spouse or any lineal descendant (including by adoption and stepchildren) of such Shareholder, (2) any trust of which such Shareholder is the trustee and which is established solely for the benefit of any of the foregoing individuals, (3) any charitable foundation selected by such Shareholder, or (4) any partnership, all of the general partner(s) and limited partner(s) (if any) of which are one or more Persons identified in this clause (i), provided that, in the case of clauses (1), (2), (3) or (4), such Person executes a Joinder Agreement; (ii) with respect to Sponsor, (a) any investor in Sponsor or an Affiliate of such investor in Sponsor or an investor in any fund or other investment vehicle established or managed by Sponsor or any of its controlled Affiliates or any other Person which is an Affiliate of Sponsor on the date hereof, (b) any of the Shareholders and any of their respective Affiliates, (c) any controlled Affiliate of Sponsor, and (d) any investor in Sponsor that is an investment fund in connection with a pro rata distribu- -6- tion of shares of Common Stock to all investors in Sponsor at the time of the expiration or termination of the fund, provided that, in the case of clauses (a), (b), (c) or (d), any such investor executes a Joinder Agreement; and provided, further, that, in the case of these clauses (a), (b) or (c) Transfers to such Persons would not cause Sponsor to own, together with its Affiliates, a number of shares equal to less than thirty percent (30%) of the outstanding shares of Common Stock of the Company as of the date of any such Transfer; (iii) with respect to Company Shareholder, any controlled Affiliate of Company Shareholder (including any wholly-owned subsidiary of Company Shareholder), provided that such Affiliate or wholly-owned subsidiary executes a Joinder Agreement; (iv) with respect to any Institutional Shareholder (other than MetLife), (a) any Affiliate of such Institutional Shareholder, (b) any investor of such Institutional Shareholder that is an investment fund in connection with a pro rata distribution of shares of Common Stock to all investors (a "Shareholder Investor" or collectively "Shareholder Investors") in such Institutional Shareholder at the time of the expiration or termination of the fund, or (c) any Person acquiring all or substantially all of the investment portfolio of such Institutional Holder; and provided, further, that, in the case of clause (a), (b) or (c), all such investors execute a Joinder Agreement; (v) with respect to Foundation Shareholder, any Affiliate of Foundation Shareholder, provided such Affiliate executes a Joinder Agreement; (vi) with respect to MetLife, (a) any Affiliate of MetLife, (b) Portfolio Advisors, LLC or any controlled Affiliate of Portfolio Advisors, LLC or (c) any Shareholder Investor of such Institutional Shareholder that is an investment fund in connection with a pro rata distribution to all Shareholder Investors of such Institutional Shareholder at the time of the expiration or termination of the fund; provided, further, that, in the case of clause (a), (b) or (c), such investors execute a Joinder Agreement; and (vii) with respect to any Shareholder, any institutional lender to which such Shareholder pledges or grants a security interest in shares of Common Stock in a bona fide transaction effected in good faith, provided that (x) such pledgee executes a Joinder Agreement and (y) prior to any subsequent foreclosure or sale of such shares or any Transfer resulting from such foreclosure is effected, the provisions of Section 4.01 must be satisfied. -7- "Person" means an individual, a corporation, a partnership, an association, a trust or any other entity or organization, including a government, a political subdivision or an agency or instrumentality thereof. "Piggyback Holder" see Section 5.01(a). "Piggyback Registration" see Section 5.01(a). "Proportionate Percentage" see Section 4.05(a). "Pro Rata Portion" means, with respect to shares of Common Stock held by a Shareholder at any date of determination such number of shares of Common Stock owned by such Shareholder as would result in such Shareholder selling the same percentage of the total number of shares of Common Stock held by such Shareholder in the Transfer subject to the applicable Transfer Notice (the "Subject Sale") as the Sponsor Transferor sells in the Subject Sale (assuming, with respect to the Transfer Notice, that all Shareholders have exercised their Tag-Along Right). "Public Offering" see Section 4.05(a)(i). "Purchaser" see Section 4.02(a). "QI Demand Holder" means any Qualified Investor other than CSFB. "Qualified Investor" means a HIP Co-Investor who (x), together with its Affiliates, at or prior to any date of determination, has made an aggregate cash investment in Common Stock of the Company equal to at least $40.0 million (based upon the original cost of such investment) or (y) owns, together with its Direct Permitted Transferees, at least 10% or more of the outstanding shares of Common Stock of the Company at the date of determination. For purposes of this definition and any other definitions containing thresholds for the dollar amount of cash invested in Common Stock of the Company or the percentage ownership of Common Stock of the Company, the cash investments and the beneficial ownership of the CSFB Funds and the CSFB Plan Partner will be deemed to be aggregated. "Qualifying Public Equity Offering" means either (x) one or more underwritten public offerings of common equity securities of the Company pursuant to an effective registration statement filed under the 1933 Act (excluding registration statements filed on Form S-8, or any similar successor form) resulting in aggregate gross proceeds to the Company of $100,000,000 or more or (y) the listing of the Common Stock on a national securities exchange or authorization for quotation on the Nasdaq National Market System for which there is a public float of least $100,000,000 held by non-Affiliates of the Company. -8- "Recapitalization Agreement" see the recitals to this Agreement. "Recapitalization Merger" see the recitals to this Agreement. "Registrable Securities" shall mean any of (i) the shares of Common Stock owned by any Shareholder at the time of determination and (ii) any other securities issued or issuable with respect to the Common Stock by way of a stock split, stock dividend, reclassification, subdivision or reorganization, recapitalization or similar event. As to any particular Registrable Securities, such securities shall cease to be Registrable Securities when (a) a registration statement with respect to the offering of such securities by the holder thereof shall have been declared effective under the 1933 Act and such securities shall have been disposed of by such holder pursuant to such registration statement, (b) such securities have been sold to the public pursuant to Rule 144 (or any similar provision then in force) promulgated under the 1933 Act, (c) except for purposes of Section 5.02, such securities shall have been otherwise transferred and new certificates for such securities not bearing a legend restricting further transfer shall have been delivered by the Company or its transfer agent and subsequent disposition of such securities shall not require registration or qualification under the 1933 Act or any similar state law then in force or (d) such securities shall have ceased to be outstanding. "Registration" see Section 5.03. "Representatives" means the officers, employees, directors and agents of such Shareholder, including, representatives of its legal, accounting and financial advisors. "Request Notice" see Section 5.02(a). "Requisite Investors" means (i) Company Shareholder for so long as Company Shareholder either (a) has outstanding commitments or loans under the Subordinated Loan Agreement, (b) owns, together with its Permitted Transferees, $10.0 million or more in liquidation preference of Class A Preferred Stock, or (c) owns, together with its Direct Permitted Transferees, at least 1,571,569 shares (as adjusted for Adjustments) of Common Stock, (ii) RM, (iii) CSFB (on behalf of itself and its Direct Permitted Transferees) and (iv) HIP Co-Investors (other than CSFB) (on behalf of the HIP Co-Investors and their Direct Permitted Transferees) owning a majority of the number of shares of Common Stock owned by all HIP Co-Investors (other than CSFB) and their Direct Permitted Transferees as a group at the applicable date of determination. "Riverside" see the recitals to this Agreement. "RM" see the recitals to this Agreement. -9- "Rollover Demand Holders" means Company Shareholder, RM and their respective Direct Permitted Transferees. "Rollover Investors" see the recitals to this Agreement. "Second Option" see Section 4.01(c). "Senior Credit Facilities" means the Credit Agreement, dated as of the date hereof, among The Chase Manhattan Bank, Chase Securities Inc., the Company and certain of its subsidiaries and the other lenders and financial institutions party thereto from time to time, as the same may be amended, modified, waived, refinanced or replaced from time to time (whether under a new credit agreement or otherwise). "Shareholders" see the recitals to this Agreement. "Significant Subsidiary" means any subsidiary of the Company that would be a "significant subsidiary" as such term is defined in Rule 1.02 of Regulation S-X under the 1933 Act. "Sponsor" means collectively the Heartland Entities or Heartland Industrial Partners, L.P. acting on behalf of the other Heartland Entities. "Sponsor Option Period" see Section 4.01(c). "Subordinated Loan Agreement" means the subordinated loan agreement dated the date hereof between Company Shareholder and the Company. "Substantial Change of Control" means the sale, lease or transfer in one or a series of related transactions of at least a majority of the consolidated assets of the Company and its subsidiaries or a majority of the Capital Stock of the Company representing the right to vote for directors to any Person or "group" of Persons (other than Sponsor and its Affiliates) whether direct or indirect or by way of any merger, consolidation or other business combination or purchase of beneficial ownership or otherwise. "Transactions" means (i) the Recapitalization Merger and (ii) all of the other transactions contemplated by the Recapitalization Agreement, including the transactions contemplated by the subscription agreements to be entered into in connection with the Recapitalization Merger. "Transfer" means the direct or indirect offer, sale, donation, assignment (as collateral or otherwise), pledge, hypothecation, encumbrance, transfer or disposition of any security. -10- "Transfer Notice" see Section 4.02(a). "Transferee" means any Person who acquires shares of Common Stock from a Shareholder and who is not a Permitted Transferee. "Triggering Event" means: (i) with respect to a Rollover Demand Holder or CSFB, after the earlier of (1) the fifth anniversary of the date hereof if an Initial Public Offering has not been consummated by the fifth anniversary of the date hereof and (2) 180 days after an Initial Public Offering; (ii) with respect to a QI Demand Holder, 180 days after an Initial Public Offering; and (iii) with respect to Sponsor, at any time. SECTION 1.02. Rules of Construction. For purposes of this Agreement whenever a threshold for the dollar amount of cash invested in Common Stock of the Company or the percentage of ownership of Common Stock is to be determined as to a Shareholder, the cash investments and the beneficial ownership of Direct Permitted Transferees of such Shareholder shall be aggregated with the cash investments and beneficial ownership of such Shareholder and the cash investments and the beneficial ownership of the Heartland Entities will be deemed to be aggregated. ARTICLE II REPRESENTATIONS AND WARRANTIES Each of the parties hereby severally represents and warrants to each of the other parties as follows: SECTION 2.01. Authority; Enforceability. Such party has the legal capacity or corporate power and authority to enter into this Agreement and to carry out its obligations hereunder. Such party (in the case of parties that are not natural persons) is duly organized and validly existing under the laws of its jurisdiction of organization, and the execution of this Agreement and the consummation of the transactions contemplated herein have been duly authorized by all necessary action. No other act or proceeding, corporate or otherwise, on its part is necessary to authorize the execution of this Agreement or the consummation of any of the transactions contemplated hereby. This Agreement has been duly executed by such party and constitutes its legal, valid and binding obligation, enforceable against it in accordance with the terms of this Agreement, -11- subject to applicable bankruptcy, insolvency, reorganization, moratorium and other laws affecting the rights of creditors generally and to the exercise of judicial discretion in accordance with general principles of equity (whether applied by a court of law or of equity). SECTION 2.02. No Breach. Neither the execution of this Agreement nor the performance by such party of its obligations hereunder nor the consummation of the transactions contemplated hereby or by the Transactions does or will: (a) in the case of parties that are not natural persons, conflict with or violate its certificate of incorporation, bylaws or other organizational documents; (b) violate, conflict with or result in the breach or termination of, or otherwise give any other person the right to accelerate, renegotiate or terminate or receive any payment or constitute a default or an event of default (or an event which with notice, lapse of time, or both, would constitute a default or event of default) under the terms of, any contract or agreement to which it is a party or by which it or any of its assets or operations are bound or affected, including, in the case of the Company, the Senior Credit Facilities or Subordinated Loan Agreement; or (c) constitute a violation by such party of any laws, rules or regulations of any governmental, administrative or regulatory authority or any judgments, orders, rulings or awards of any court, arbitrator or other judicial authority or any governmental, administrative or regulatory authority. SECTION 2.03. Consents. No consent, waiver, approval, authorization, exemption, registration, license or declaration is required to be made or obtained by such party, other than those which have been made or obtained, in connection with (i) the execution or enforceability of this Agreement or (ii) the consummation of any of the transactions contemplated hereby or by the Transactions. SECTION 2.04. Share Ownership. (a) The Company represents and warrants that in the case of a Shareholder, such party will own, immediately following the consummation of the transactions contemplated by the Recapitalization Agreement, the number of shares of Capital Stock of the Company set forth opposite such party's name in Schedule 2.04 attached hereto, free and clear of any and all liens, claims and encumbrances, other than those created by this Agreement. (b) The Company represents and warrants that, as of the date hereof after giving effect to the Transactions, the authorized capital stock of the Company consists of (A) 250,000,000 shares of Common Stock, of which 30,177,943 shares of Common Stock are issued and outstanding (without giving effect to the restricted stock awards, whether or not -12- vested, or shares of Common Stock issuable to the former stockholders of K-Tech Mfg., Inc. pursuant to documentation in existence prior to the Transactions), and (B) 25,000,000 shares of preferred stock, of which 361,001 shares of Class A Preferred Stock are issued and outstanding. Without giving effect to any cash elections or any accretion in respect of restricted stock awards after the date of the Transactions and assuming full vesting of restricted stock awards granted as of the date of the Transactions, there are approximately 3,741,325 shares of Common Stock subject to restricted stock awards on the date hereof after giving effect to the Transactions. The maximum number of shares of Common Stock issuable to the former K-Tech Mfg., Inc. stockholders is not presently determinable, but is estimated at up to approximately 550,000 shares of Common Stock. Except (i) as provided for in this Agreement, (ii) for accretion in respect of restricted stock awards after the date hereof, (iii) for Common Stock to be issued to former stockholders of K-Tech Mfg., Inc. arising out of obligations existing prior to the Transactions, as of the date of the Transactions, no subscription, warrant, option, convertible or exchangeable security or other right to purchase or acquire any shares of Capital Stock of the Company is authorized or outstanding and the Company has no obligation to issue any subscription, warrant, option, convertible or exchangeable security or other such right. (c) The Company represents and warrants that the shares of Common Stock issued to each Shareholder in connection with the Recapitalization Merger were duly and validly authorized, and when issued to each Shareholder in connection with the Recapitalization Merger will be duly and validly issued, fully paid and non-assessable and such shares are not subject to preemptive or similar rights except as provided by this Agreement. (d) Each Shareholder hereby consents to and approves of the contribution by the Company in connection with the Transactions of all of its assets to Metalync Company LLC, its wholly-owned subsidiary, as required by the Senior Credit Facilities. ARTICLE III SHARE TRANSFERS SECTION 3.01. Restrictions on Transfer. During the term of this Agreement, each Shareholder agrees that it will not Transfer any Common Stock, except as permitted by or in accordance with this Agreement. SECTION 3.02. Exceptions to Restrictions. Subject to all applicable laws, the restrictions on Transfer set forth in Section 3.01 hereof shall not apply to any of the following: -13- (a) a Transfer by a Shareholder of Common Stock to one of its Permitted Transferees; provided that such Permitted Transferee shall agree to execute a Joinder Agreement in the form annexed hereto as Exhibit A (the "Joinder Agreement"); (b) a Transfer of Common Stock by a Shareholder in accordance with Sections 4.02 and 4.03 of this Agreement; (c) a Transfer by a Shareholder after such Shareholder has complied with Section 4.01; provided that the Transferee shall agree to execute a Joinder Agreement; and (d) a Transfer of Common Stock by a Shareholder pursuant to an effective registration statement under the 1933 Act or a Transfer pursuant to Rule 144 under the 1933 Act. SECTION 3.03. Improper Transfer. Any attempt to Transfer any shares of Common Stock not in accordance with this Agreement shall be null and void and the Company will not give nor permit the Company's transfer agent to give any effect to such attempted Transfer in its stock records. SECTION 3.04. Restrictive Legend. Each certificate representing shares of Common Stock and held by a Shareholder will bear a legend substantially similar to the following (with such additions thereto or changes therein as the Company may be advised by counsel are required by law or necessary to give full effect to this Agreement): "THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO (i) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE UNITED STATES SECURITIES ACT OF 1933 OR (ii) AN APPLICABLE EXEMPTION FROM REGISTRATION THEREUNDER. ANY SALE PURSUANT TO CLAUSE (ii) OF THE PRECEDING SENTENCE MUST BE ACCOMPANIED BY AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY TO THE EFFECT THAT SUCH EXEMPTION FROM REGISTRATION IS AVAILABLE IN CONNECTION WITH SUCH SALE. THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO THE TERMS AND CONDITIONS, INCLUDING WITH RESPECT TO THE DIRECT OR INDIRECT TRANSFER THEREOF, OF A SHAREHOLDERS AGREEMENT DATED AS OF NOVEMBER 28, 2000. THE SHAREHOLDERS AGREEMENT CONTAINS, AMONG OTHER THINGS, SIGNIFICANT RESTRICTIONS ON TRANSFER OF THE SE- -14- CURITIES OF THE COMPANY. A COPY OF THE SHAREHOLDERS AGREEMENT IS AVAILABLE UPON REQUEST FROM THE COMPANY." ARTICLE IV RIGHTS OF CERTAIN SHAREHOLDERS SECTION 4.01. Rights of First Offer. (a) At any time or from time to time prior to a Qualifying Public Equity Offering, in the event that (x) at any time following the first anniversary of the date hereof (provided, however, that, prior to the second anniversary of the date hereof, such Rollover Investor does not in the good faith judgment of the Company jeopardize the "recapitalization" accounting treatment afforded the Company in the Recapitalization Merger), a Rollover Investor desires to Transfer, or (y) at any time following the date hereof, a HIP Co-Investor desires to Transfer, all or part of its Common Stock ("Offered Shares"), other than pursuant to Section 3.02(a), 3.02(d), 4.02 or 4.03 of this Agreement, such Rollover Investor or HIP Co-Investor (individually, an "Investor") shall give prompt written notice (an "Investor's Notice") of its desire to sell the Offered Shares to the Company and Sponsor. The Investor's Notice shall identify (i) the number of Offered Shares and (ii) all other material terms and conditions of the proposed Transfer including the purchase price and the form of the consideration. (b) The Company shall have the right, but not the obligation, to purchase all, but not less than all, the Offered Shares (the "First Option") on the same terms and conditions as set forth in the Investor's Notice, which option shall be exercised by delivering to such Investor irrevocable written notice of its commitment to purchase the Offered Shares within fifteen (15) business days after receipt of the Investor's Notice (the "Company Option Period"). Failure by the Company to give such notice within such fifteen (15) business day period shall be deemed an election by the Company not to purchase the Offered Shares. (c) In the event that the Company decides not to purchase the Offered Shares pursuant to Section 4.01(b), then Sponsor shall have the right, but not the obligation, to purchase all, but not less than all, the Offered Shares (the "Second Option") on the same terms and conditions as set forth in the Investor's Notice, which option shall be exercised by delivering to such Investor irrevocable written notice of its commitment to purchase the Offered Shares within ten (10) business days after the termination of the Company Option Period (the "Sponsor Option Period"); provided that Sponsor may, at its sole option, assign its rights to purchase an Investor's Offered Shares pursuant to this Section 4.01 to another Shareholder or a Permitted Transferee of Sponsor (such person an "Assignee"); provided that if the Assignee is a HIP Co-Investor, each HIP Co-Investor will be able to participate in such assignment on -15- a pro rata basis. Failure by Sponsor or its Assignee to give such notice within such ten (10) business day period shall be deemed an election by Sponsor or its Assignee not to purchase the Offered Shares. (d) Delivery of written notice by the Company, Sponsor or its Assignee accepting the First Option or the Second Option, as the case may be, shall constitute a contract between the Company, Sponsor or its Assignee, on the one hand, and such Investor on the other hand, for the purchase and sale of the Offered Shares on the terms and conditions set forth in the Investor's Notice. The purchase of any shares pursuant to the exercise of the First Option or the Second Option, as the case may be, shall be completed not later than forty-five (45) days following receipt of the Investor's Notice with respect to the Offered Shares, subject to receipt of any required material third-party or governmental approvals, compliance with applicable laws and the absence of any injunction or similar legal order preventing such transaction (collectively, the "Conditions") in which case the purchase of the Offered Shares shall be delayed pending the satisfaction of the Conditions up to an additional thirty (30) days. As a condition to entering into the contract referred to above, the Company, Sponsor and its Assignee will agree to use commercially reasonable efforts to satisfy the Conditions as soon as possible. In the event that neither the First Option nor the Second Option is exercised, the Investor shall have the right for a period of seventy-five (75) days after the termination of the Sponsor Option Period to Transfer (the "Investor Sale") the Offered Shares at a price not less than ninety percent (90%) of the price contained in, and otherwise on terms and conditions no less favorable to such Investor than those set forth in, the Investor's Notice, except that the purchase of the Offered Shares may be delayed up to an additional thirty (30) days pending satisfaction of the Conditions; provided that the Transferee agrees to execute a Joinder Agreement. If the Investor Sale is not consummated pursuant to the terms of the immediately preceding sentence, the Investor will not effect Transfer of any of the Offered Shares without commencing de novo the procedures set forth in this Section 4.01. SECTION 4.02. Tag-Along Rights. (a) If, at any time or from time to time prior to a Qualifying Public Equity Offering, Sponsor or any of its Affiliates (the "Sponsor Transferor") proposes to Transfer any shares of Common Stock to a Person (the "Purchaser"), other than pursuant to Section 3.02(a), 3.02(d), 5.01 or 5.02 or in a circumstance where all of the shares owned by all of the Shareholders are being purchased pursuant to Section 4.03, the Sponsor Transferor shall give written notice (a "Transfer Notice") of such proposed Transfer to the Shareholders at least fifteen (15) days prior to the consummation of such proposed Transfer, setting forth (A) the total number of shares of Common Stock offered to be Transferred to Purchaser, (B) the consideration to be received for such shares of Common Stock by the Sponsor Transferor, (C) the identity of the Purchaser(s), (D) any other material terms and conditions of the proposed Transfer, (E) the expected date of the proposed Transfer and (F) that each such Shareholder shall have the right (the "Tag-Along Right") to elect to sell up to its Pro Rata Portion of such -16- shares of Common Stock to be Transferred to Purchaser. If any portion of the consideration contained in the Transfer Notice includes consideration other than cash, the Sponsor Transferor shall provide the Shareholders with a summary of a valuation study, if any, that the Sponsor Transferor has prepared concerning such consideration, but the Sponsor Transferor shall have no liability to any Shareholder with respect to any such summary or study and no obligation to undertake any such valuation. Notwithstanding the first sentence of this Section 4.02(a), a Shareholder will have a Tag-Along Right in connection with Transfers of shares of Common Stock by the Sponsor Transferor to a Permitted Transferee (other than an Affiliate of the Sponsor Transferor) when the Sponsor Transferor Transfers shares of Common Stock to such Person at a price per share (as adjusted for Adjustments) that is greater than the price per share (as adjusted for Adjustments) paid for such shares by the Sponsor Transferor. (b) Upon delivery of a Transfer Notice, each Shareholder has the option, but not the obligation, to sell up to the Pro Rata Portion of its shares of Common Stock at the same price per share of Common Stock and pursuant to the same terms and conditions with respect to payment for the shares of Common Stock as agreed to by the Sponsor Transferor, by sending written notice to the Sponsor Transferor within ten (10) days of the date of the Transfer Notice, indicating its election to sell up to the Pro Rata Portion of its shares of Common Stock in the same transaction. To the extent that elections pursuant to this Section 4.02(b) are not made with respect to any shares of Common Stock included in a Transfer Notice within such 10-day period, then the Sponsor Transferor shall re-offer to Shareholders who have elected to sell their Pro Rata Portion (the "Tag-Along Shareholders") for one additional three day period, the right to sell such additional number of shares as will result in the Tag-Along Shareholders being able to sell their pro rata share of such remaining shares of Common Stock, based upon all the shares of Common Stock being sold by all the Tag Along Shareholders (not including the remaining shares). For a sixty (60) day period following such ten (10) day period (which period may be extended an additional thirty (30) days in order to satisfy the Conditions), each Tag-Along Shareholder shall be permitted to sell to the Purchaser(s) on the terms and conditions set forth in the Transfer Notice that amount of its shares of Common Stock as to which it has made its election and the Sponsor Transferor shall be permitted to concurrently sell the balance of the shares of Common Stock that are the subject of the Transfer Notice that are not sold by the Tag-Along Shareholders. (c) The provisions of Section 4.02(a) and (b) shall not apply to any Transfer or series of Transfers by Sponsor of shares of Common Stock to one or more Persons other than Permitted Transferees which in the aggregate do not exceed ten percent (10%) of such shares of Common Stock owned by Sponsor immediately following the Transactions. (d) Each Tag-Along Shareholder shall not be required to make representations and warranties in connection with such sale other than customary representations and -17- warranties with respect to (i) such Shareholder's due organization, power and authority, (ii) such Shareholder's ownership of the shares of Common Stock and ability to freely convey such shares of Common Stock without liens or encumbrances, (iii) customary representations regarding non-contravention of such Shareholder's charter, bylaws or other organizational documents or material agreements of such Tag-Along Shareholder and (iv) the enforceable nature of such Tag-Along Shareholder's obligations under the documents for such sale to which it is a party (collectively, the "Shareholder Representations"). No Tag-Along Shareholder shall be liable in respect of any indemnification provided in connection with a Tag-Along Sale (with respect to such Shareholder's Shareholder Representations) in excess of the consideration received by such Tag-Along Shareholder in such Tag-Along Sale and no Tag-Along Shareholder shall be required to participate in any escrow relating to such Tag-Along Sale in excess of such Tag-Along Shareholder's participation in the Tag-Along Sale. (e) In the event that no Shareholder elects to sell shares of Common Stock pursuant to this Section 4.02, Sponsor and/or its Affiliates (as the case may be) shall have the right for a period of seventy-five (75) days (which period may be extended by an additional thirty (30) days to satisfy the Conditions) after the expiration of the 10-day period referred to in Section 4.02(b) to Transfer the Shares subject to the Transfer Notice to the Purchaser at a price not greater than the price contained in, and otherwise on terms and conditions no more favorable to Sponsor and/or such Affiliates than those set forth in, the Transfer Notice; it being agreed that, after the end of the 75-day period referred to in this Section 4.02(e) (including any permitted extension thereof), Sponsor and/or such Affiliates will not effect any transaction in any shares of Common Stock that are the subject of the Transfer Notice without commencing de novo the procedures set forth in this Section 4.02. SECTION 4.03. Drag-Along Rights. If at any time prior to a Qualifying Public Equity Offering, Sponsor and its Affiliates intend to effect a Substantial Change of Control, Sponsor shall have the right to require the other Shareholders (the "Drag-Along Shareholders") to sell the same percentage of Common Stock held by them relative to such Shareholder's ownership of Common Stock as Sponsor and its Affiliates are selling in such transaction in connection with such Substantial Change of Control; to vote such Common Stock, whether by proxy, voting agreement or otherwise in favor of the transactions constituting a Substantial Change of Control; to waive their appraisal or dissenters' rights with respect to such transaction; or otherwise, participate in such Substantial Change of Control and each other Shareholder agrees to take any and all reasonably necessary action in furtherance of the foregoing; provided that (a) the consideration to be received by the other Shareholders shall be for the same type and amount per share of consideration received by Sponsor, and (b) after giving effect to such transaction, Sponsor and its Direct Permitted Transferees shall have sold the same percentage of their holdings of Common Stock of the Company as sold by the Drag-Along Shareholders; provided, however, that CSFB will not be obligated to participate in such transaction if the consideration per share in -18- such transaction is less than $16.90 per share (as adjusted for Adjustments) of the Common Stock of the Company paid by CSFB in connection with the Transactions and provided, further, that if Sponsor and its Affiliates are selling all of their shares of Common Stock in connection with such Substantial Change of Control, the Drag-Along Shareholders will be required to sell all of their shares pursuant to this Section 4.03. In connection with the sale of their shares of Common Stock pursuant to this Section 4.03, the Drag-Along Shareholders shall not be required to make any representations and warranties other than the Shareholder Representations. In addition, no Drag-Along Shareholder shall be liable in respect of any indemnification in connection with a transaction effected pursuant to this Section 4.03 (a "Drag-Along Transaction") (with respect to such Shareholder's Shareholder Representations) in excess of the consideration received by such Drag-Along Shareholder in such Drag-Along Transaction and no such Drag-Along Shareholder shall be required to participate in any escrow relating to such Drag-Along Transaction in excess of such Drag-Along Shareholder's Pro Rata Portion. SECTION 4.04. Information. (a) Prior to the occurrence of an Initial Public Offering, the Company shall deliver to each Shareholder: (1) as soon as available, but in any event within forty-five (45) days after the end of each quarter, copies of: (i) consolidated balance sheets of the Company and its subsidiaries as at the end of such quarter, and (ii) consolidated statements of income, stockholders' equity and cash flows of the Company and its subsidiaries, for such quarter and for the portion of the fiscal year ending with such quarter, in each case prepared in accordance with GAAP applicable to periodic financial statements generally, fairly presenting, in all material respects, the financial position of the Persons being reported on and their results of operations and cash flows, subject to changes resulting from normal year-end adjustments; (2) as soon as available, but in any event within ninety (90) days after the end of each fiscal year of the Company, copies of: (i) consolidated balance sheets of the Company and its subsidiaries as at the end of such year, and (ii) consolidated statements of income, stockholders' equity and cash flows of the Company and its subsidiaries for such year, -19- in each case prepared in accordance with GAAP, fairly presenting, in all material respects, the financial position of the Persons being reported on and their results of operations and cash flows, and accompanied by an opinion thereon of independent certified public accountants of recognized national standing, which opinion shall state that such financial statements present fairly, in all material respects, the financial position of the Persons being reported upon and their results of operations and cash flows and have been prepared in conformity with GAAP; (b) In the case of any Shareholder (other than CSFB) prior to the occurrence of a Qualifying Public Equity Offering, and for so long as such Shareholder owns twenty-five percent (25%) or more of the number of shares of Common Stock (as adjusted for Adjustments) owned by such Shareholder immediately following the Transactions, or in the case of CSFB, for so long as CSFB retains a number of shares of Common Stock equal to at least twenty-five (25%) of the number of shares of Common Stock (as adjusted for Adjustments) owned by CSFB immediately following the Transactions, the Company shall deliver to each such Shareholder and CSFB: (1) the information and reports provided pursuant to Sections 4.04(a)(1) and (2); (2) monthly "flash reports" utilized by the Company in its own management containing summarized, abbreviated data with respect to income statement amounts, balance sheet data and cash flows; and (3) such other information concerning the condition or operations, financial or otherwise, of the Company and its Subsidiaries as a Shareholder may, from time to time, reasonably request. (c) The rights to receive the information set forth in subsections (1) and (2) of paragraph (a) shall be assignable to Transferees of Common Stock. The rights to receive the information set forth in subsections (2) and (3) of paragraph (b) shall be assignable to a Transferee that acquires from CSFB at least 25% of the shares of Common Stock owned by CSFB as of the date hereof (as adjusted for Adjustments). (d) Prior to the occurrence of a Qualifying Public Equity Offering, and for so long as a Shareholder owns twenty-five percent (25%) or more of the number of shares of Common Stock owned by such Shareholder immediately following the Transactions (as adjusted for Adjustments), Representatives of such Shareholder shall be provided with a reasonable opportunity to discuss the business and affairs of the Company with the Company's senior managers, directors, officers and senior employees upon reasonable advance notice during normal business hours; provided that such Company representatives shall be available (A) to such Shareholder for an annual meeting with senior management at which the following -20- year's budget is presented and (B) to Qualified Investors, RM and Company Shareholder for quarterly meetings at which the most recent quarterly results are discussed. (e) Each Shareholder hereby agrees that neither it nor its Representatives will disclose to any third party any information provided to it or its Representatives by the Company hereunder which is not generally available to the public, except with the prior express approval of the Company or as may be required by applicable law; it being understood that nothing in this Section 4.04(e) will restrict the ability of Sponsor or a HIP Co-Investor to disclose certain information to its investors in accordance with the governing documents of their partnership arrangement; provided that such investors agree to be bound by the confidentiality provisions of this Agreement. (f) Notwithstanding the above, access to highly confidential proprietary information and facilities need not be provided by the Company, nor shall the Company be required to provide information to any Shareholder that is a competitor or reasonably likely to become a competitor of the Company or any of its subsidiaries; it being understood that the Shareholders existing as of the date hereof are not competitors. (g) Notwithstanding the foregoing, (x) MetLife in addition to Portfolio Advisors, LLC or any controlled Affiliate of Portfolio Advisors, LLC shall have the rights provided by this Section 4.04 notwithstanding the fact it has transferred all of its shares of Common Stock to Portfolio Advisors, LLC or any controlled Affiliate of Portfolio Advisors, LLC, provided such Person would have such rights as a Shareholder (it being agreed that, solely for purposes of paragraphs (b) and (d) of this Section 4.04, such Person shall be deemed to have held its shares of Common Stock since the consummation of the Transactions) and (y) Company Shareholder shall be entitled to receive the information provided by this Section 4.04 so long as Company Shareholder owns any Class A Preferred Stock or has outstanding commitments or loans under the Subordinated Loan Agreement. SECTION 4.05. Preemptive Rights. (a) Prior to the occurrence of an Initial Public Offering, the Company hereby grants and hereby agrees to cause each Significant Subsidiary of the Company to grant to each HIP Co-Investor and its Direct Permitted Transferees and Sponsor and its Direct Permitted Transferees the right to purchase up to such Shareholder's Proportionate Percentage (as hereinafter defined) of any future Eligible Offering (as hereinafter defined) and in the case such Eligible Offering is in whole or in part to Sponsor or any of its Affiliates, then the Company shall also grant Company Shareholder and RM the right to purchase up to their Proportionate Percentage. For purposes of this Section 4.05, the following terms shall have the meanings set forth below. "Proportionate Percentage" means, with respect to any Shareholder as of any given date with respect to an Eligible Offering, the lower of (i) twenty percent (20%) -21- of such Eligible Offering or (ii) the number (expressed as a percentage) obtained by dividing (A) the number of shares of Common Stock owned by such Shareholder as of such date by (B) the total number of shares of Common Stock outstanding as of such date, in each case, assuming all shares of Capital Stock of the Company convertible into or exercisable for Common Stock have been so converted; provided that CSFB should not be limited by the foregoing clause (i) in the event that the Eligible Offering consists of Capital Stock of the Company for a consideration per share of Capital Stock which is less than the purchase price per share of Common Stock paid by CSFB in connection with the Transactions (as such price is adjusted by the Adjustments). "Eligible Offering" means an offer by the Company or a Significant Subsidiary of the Company to sell to any Person or Persons (including any of the Shareholders) for cash, any Capital Stock of the Company or any Significant Subsidiary, other than an offering by the Company or a Significant Subsidiary of the Company: (i) of Common Stock in an underwritten public offering (a "Public Offering") registered under the 1933 Act or pursuant to a Rule 144A offering under the 1933 Act; (ii) of Common Stock of the Company issued upon the exercise of options, warrants or convertible securities outstanding as of the date hereof; (iii) of Common Stock of the Company or options to purchase shares of Common Stock in connection with or pursuant to any stock option, stock purchase plan or agreement or other benefit plans approved by the Board of Directors of the Company to full-time employees, officers, directors, consultants and/or advisors to the Company or its subsidiaries;(excluding employees of Sponsor); (iv) of Common Stock of the Company issued in connection with restricted stock awards pursuant to and in accordance with the Recapitalization Agreement; (v) of Common Stock of the Company having a value of up to $5.2 million in order to comply with Section 5.15 of the Senior Credit Facilities; (vi) of Capital Stock of the Company issued as consideration to any seller in connection with the acquisition by the Company or any subsidiary of the Company of the assets of any Person in any transaction approved by the Board of Directors of the Company; -22- (vii) of Capital Stock of the Company issued as an inducement in connection with any debt financing of the Company, subject to terms and conditions approved by the Board of Directors of the Company; (viii) of Capital Stock of a Significant Subsidiary of the Company in connection with any sale of control of such Significant Subsidiary to, or any joint venture between such Significant Subsidiary and, a third party that is not a financial sponsor or investor, which sale or joint venture is approved by the Board of the Directors of the Company; (ix) of director qualifying or similar shares of a Significant Subsidiary; (x) of Capital Stock of the Company issued as consideration in connection with the acquisition by the Company or any subsidiary of the Company of Simpson Industries, Inc. or Global Metal Technologies, Inc. (or any parent company thereof); and (xi) of Capital Stock of the Company issued to former stockholders of K-Tech Mfg., Inc. arising out of obligations existing prior to the Transactions. For purposes of this Section 4.05 only, "Capital Stock" means any and all shares of common stock or options, warrants or similar instruments or any other securities convertible or exchangeable therefor (collectively, "Equity Interests") or any equity security linked to or offered or sold in connection with any Equity Interests of such Person or any of its Significant Subsidiaries, as the case may be. (b) The Company shall, before any securities are issued pursuant to an Eligible Offering, give written notice (a "Preemptive Notice") thereof to each Shareholder that is entitled to preemptive rights hereunder. Such notice shall specify the security or securities proposed to be issued, the proposed date of issuance, the consideration that the Company or such Significant Subsidiary, as the case may be, intends to receive therefor and all other material terms and conditions of such proposed issuance. For a period of ten (10) business days following the date of such notice, each such Shareholder shall be entitled, by written notice to the Company, to elect to purchase all or part of such Shareholder's Proportionate Percentage of the securities being sold in the Eligible Offering. To the extent that elections pursuant to this Section 4.05(b) shall not be made with respect to any shares of Common Stock included in a Preemptive Notice within such 10-day period, then the Company shall re-offer to Shareholders who have elected to purchase their Proportionate Percentage (the "Preemptive Shareholders") for one additional three-day period, the right to purchase any part of the shares of Common Stock not purchased by other Shareholders (the "Section 4.05 Remaining Shares") -23- pursuant to this Section 4.05 which is equal to the product obtained by multiplying (i) the number of Section 4.05 Remaining Shares by (ii) a fraction, the numerator of which is the number of shares of Common Stock then owned by any such Preemptive Shareholder and the denominator of which is the aggregate number of shares owned by all Preemptive Shareholders. To the extent that elections pursuant to this Section 4.05(b) shall not be made with respect to any securities included in an Eligible Offering within such ten (10) business day period, then the Company or such Significant Subsidiary, as the case may be, shall not be obligated to issue to such Shareholder such securities for which such Shareholder has elected not to purchase. To the extent that there are securities that have not been purchased pursuant to this Section 4.05, then the Company or such Significant Subsidiary, as the case may be, may issue such securities, but only for consideration not less than, and otherwise on no less favorable terms to the Company or such Significant Subsidiary, as the case may be, than, those set forth in the Company's notice and only within thirty (30) days after the end of such ten (10) business day period. In the event that any such offer is accepted by any such Shareholder or Shareholders, the Company or such Significant Subsidiary, as the case may be, shall sell to such Shareholder or Shareholders, and such Shareholder or Shareholders shall purchase from the Company or such Significant Subsidiary, as the case may be, for the consideration and on the terms set forth in the notice as aforesaid, the securities that such Shareholder or Shareholders shall have elected to purchase within ten (10) business days of such Shareholder's election to purchase such Proportionate Percentage (subject to delay for an additional thirty days for satisfaction of the Conditions). (c) Each of the Shareholders granted rights pursuant to this Section 4.05 acknowledges that it has been given the opportunity to purchase their Proportionate Percentage of Common Stock in connection with the acquisition of Simpson Industries, Inc. and accordingly this Section 4.05 shall not apply to the acquisition of Simpson Industries, Inc. (d) The Company may comply with any applicable securities laws before issuing any shares of Common Stock pursuant to this Section 4.05 and shall not be in violation of the provisions hereof by reason of such compliance; provided it is using commercially reasonable efforts to so comply. SECTION 4.06. Board of Directors. (a) At each annual or special stockholders meeting called for the election of directors, and whenever the Shareholders of the Company act by written consent with respect to the election of directors, each Shareholder agrees to vote or otherwise give such Shareholder's consent in respect of all shares of the Capital Stock of the Company (whether now owned or hereafter acquired) owned by such Shareholder, and take all other appropriate action and the Company shall take all necessary and desirable actions within its control in order to cause: -24- (i) an amendment to the Bylaws of the Company to provide that the authorized number of directors on the Board of Directors of the Company shall be as recommended by the Sponsor in its sole discretion. (ii) the election to the Board of Directors of: (a) such number of directors as shall constitute a majority of the Board of Directors as designated by Heartland Industrial Partners, L.P.; (b) one director designated by the Company Shareholder; provided, however, that except as set forth in the immediately following sentence of this subpart (b) upon Company Shareholder and its Direct Permitted Transferees ceasing to own at least 1,571,569 shares of Common Stock or, upon a Qualifying Public Equity Offering, Company Shareholder shall no longer have the right to designate one director to the Board. Notwithstanding the foregoing, Company Shareholder shall maintain the right to designate one director to the Board of Directors for so long as Company Shareholder or its Affiliates, own (x) $10.0 million or more of liquidation preference of the Class A Preferred Stock or (y) have outstanding loans or unfunded commitments under the Subordinated Loan Agreement; and (c) one director designated by the CSFB Plan Partner (the "CSFB Director") after consultation with Sponsor; provided, however, that upon CSFB and its Direct Permitted Transferees ceasing to own a number of shares of Common Stock which would equal at least a majority of the shares of Common Stock owned by CSFB immediately following the Transactions (as adjusted for Adjustments), CSFB shall no longer have the right to designate one director to the Board of Directors; all of which persons shall hold office subject to their earlier removal in accordance with clause (iii) below, the Bylaws of the Company and applicable corporate law, until their respective successors shall have been elected and shall have qualified; (iii) the removal from the Board of Directors (with or without cause) of any director elected in accordance with subpart (a), (b) or (c) of clause (ii) above upon the written request of the Shareholders that designated such director; and (iv) upon any vacancy in the Board of Directors as a result of any individual designated as provided in clause (ii) above ceasing to be a member of the Board of Directors whether by resignation or otherwise, the election to the Board of Directors as promptly as possible of an individual designated by the Shareholders that designated -25- such individual; provided that the CSFB Plan Partner will consult with Sponsor prior to designating a replacement to serve as the CSFB Director. (b) The ability of a Shareholder to designate a director to the Board of Directors shall not be assignable to any Person. (c) The parties hereto agree to cause the Board of Directors to appoint the CSFB Director to each decision making committee of the Board and to cause such CSFB Director to be nominated to the Board of each subsidiary of the Company to the extent the composition of such boards is substantially identical to the composition of the Board. (d) The Company agrees to provide customary directors' liability insurance. SECTION 4.07 Right to Observer. In the case of a Qualified Investor (other than CSFB), for so long as such Qualified Investor retains a number of shares of Common Stock equal to at least a majority of, or, in the case of the CSFB Plan Partner, for so long as it retains a number of shares of Common Stock equal to at least twenty-five percent (25%) of, the shares of Common Stock owned by such Person immediately following the Transactions (as adjusted for the Adjustments), such Person will have right to send one Representative on its behalf (the "Observer") to attend all meetings of the Board, including all committees thereof, solely in a non-voting observer capacity. The Company will furnish to the Observer copies of all notices, minutes, consents and other materials that it generally makes available to its directors. The Observer may participate in discussions of matters under consideration by the Board of the Company and any matters brought before any committee thereof but will not be entitled to vote on any matter presented to the Board of Directors. Any Qualified Investor and the CSFB Plan Partner will have the right to remove and replace its Observer in its sole discretion and to designate a substitute representative if its Observer is unable or unwilling to attend any of the Board's meetings, including any committees thereof. The right of Qualified Investors (other than CSFB) to appoint an Observer as set forth in this Section 4.07 will terminate upon the occurrence of a Qualifying Public Equity Offering. SECTION 4.08. Consultation Right. (a) The Company hereby agrees to consult (a "Consultation") with the Representatives of the CSFB Plan Partner set forth on Exhibit B hereto with respect (x) to any issues, events or transactions pertaining to the Company which in the good faith judgment of the Board of Directors of the Company are material to the consolidated business, operations and financial condition of the Company and (y) to the preparation of the annual business plan of the Company. In connection with any Consultation, the Company will provide such Representatives with all material information regarding any action under consideration and reasonable notice so that the consultation period shall constitute sufficient time for the CSFB Plan -26- Partner to participate meaningfully in any decision-making process regarding the action to be taken. (b) The provision of Section 4.08(a) shall terminate upon a Qualifying Public Equity Offering. SECTION 4.09. Approval Rights. (a) The Company hereby agrees not to enter into or adopt any Material Event (as defined below) without the prior written approval of the majority of the Representatives of the CSFB Plan Partner set forth on Exhibit B hereto, which approval with respect to clauses (i) and (ii) of the definition of "Material Event" will not be unreasonably withheld. For the purpose of this Section 4.09, "Material Event" means (i) any agreement to acquire a business with a total enterprise value of $250.0 million or more individually or any agreement to acquire a business if there have been one or more agreements during the immediately preceding twelve (12) month period for acquisitions(s) with a total enterprise value of $500.0 million or more (it being hereby agreed by the parties that the acquisition of Global Metal Technologies, Inc. shall be counted toward such $500.0 million threshold and that the acquisition of Simpson Industries, Inc. shall not be counted toward such threshold); (ii) the selection of a chief executive officer of the Company; (iii) any restructuring of debt or other similar transaction pursuant to which debt holders of the Company would hold twenty-five percent (25%) or more of the outstanding Capital Stock of the Company; and (iv) any liquidation, dissolution, winding-up of the affairs of the Company, whether voluntary or involuntary, or the filing of a voluntary petition in bankruptcy or the filing of a plan of reorganization. The Company hereby agrees to promptly give notice to the CSFB Plan Partner if the Company is contemplating any Material Event. The CSFB Plan Partner hereby agrees to notify the Company within ten (10) business days of the receipt of such notice as to whether it approves of the Material Event. Failure of the CSFB Plan Partner to notify the Company in writing within such ten (10) business day period of its approval or disapproval of the Material Event shall be deemed an approval by the CSFB Plan Partner of such Material Event. (b) The provisions of Section 4.09(a) shall terminate upon a Qualifying Public Equity Offering. SECTION 4.10. Transactions with Affiliates. Without the consent of the Requisite Investors, for so long as Sponsor directly or indirectly beneficially owns twenty percent (20%) or more of the outstanding shares of Common Stock of the Company, the Company and its subsidiaries will not enter into, or suffer to exist, any transaction with Sponsor or any of its Affiliates involving payments or other consideration in excess of $1.0 million. The foregoing restrictions will not apply to: (a) the payment of annual monitoring fees to Sponsor in an amount not to exceed (x) $4.0 million plus reimbursement of out-of-pocket expenses incurred by Sponsor in connection with the advisory services provided to the Company for the first -27- year after the date hereof and (y) not to exceed 0.25% of the consolidated assets of the Company in subsequent years; provided that such amount will not be less than $4.0 million plus reimbursement of out-of-pocket expenses incurred by Sponsor in connection with the advisory services provided to the Company; (b) the payment to Sponsor of advisory fees and out-of-pocket expense reimbursement in connection with an acquisition, divestiture or financing by the Company or any of its subsidiaries (but excluding sales and purchases of personal property in the ordinary course of business) provided that such fees shall be in an amount equal to 1% of the aggregate value of such transaction; (c) fees payable to Sponsor in connection with the Transactions and reimbursement of out-of-pocket expenses incurred by Sponsor in connection with the Transactions; (d) transactions involving the sale, purchase or lease of goods or services in the ordinary course of business and on an arm's-length basis between or among the Company or any of its subsidiaries and portfolio companies of Sponsor; (e) transactions between or among the Company or any of its subsidiaries; (f) issuances of Capital Stock to Sponsor and its Affiliates pursuant to, and in compliance with, Section 4.05; and (g) issuances of Common Stock to Sponsor and other Shareholders, as applicable (valued at $16.90 or more per share of Common Stock, unless otherwise determined by the Board of Directors of the Company) for cash, or in exchange for common stock, to provide for the acquisition by the Company or one of its subsidiaries of all of the outstanding Capital Stock of Simpson Industries, Inc. or Global Metal Technologies, Inc. (or any parent company thereof) either initially or within one (1) year after the acquisition thereof by Sponsor or one of its Affiliates (based on the cash equity provided by Sponsor and its Affiliates at the closing of any such acquisition). Notwithstanding the foregoing, the benefits of this Section 4.10 in favor of a class of Requisite Investors (other than Company Shareholder) shall terminate as to it individually when such class (including their respective Direct Permitted Transferees) ceases to own a number of shares of Common Stock that would equal at least a majority of the number of shares of Common Stock (appropriately adjusted for Adjustments) owned by such class immediately following the Transactions. The benefits of this Section 4.10 in favor of Company Shareholder will terminate as to Company Shareholder when Company Shareholder (i) ceases to have outstanding commitments or loans under the Subordinated Loan Agreement, (ii) owns, together with its Direct Permitted Transferees, less than $10.0 million of liquidation preference of Class A Preferred Stock and (iii) ceases to own, together with its Direct Permitted Transferees, at least 1,571,569 shares of Common Stock. ARTICLE V REGISTRATION RIGHTS SECTION 5.01. Company Registration. (a) Right to Piggyback on Registration of Stock. Subject to Section 5.01(c), if at any time or from time to time the Company proposes to register the Common -28- Stock under the 1933 Act in connection with a public offering (other than an Initial Public Offering consisting solely of primary Common Stock or in connection with the registration of shares of Common Stock issued to former shareholders of K-Tech Mfg., Inc. arising out of, or in lieu of, obligations existing prior to the Transactions) of such Common Stock on any form other than Form S-4 or Form S-8 or any similar successor forms or another form used for a purpose similar to the intended use for such forms (a "Piggyback Registration"), whether for its own account or for the account of one or more shareholders of the Company, the Company shall each such time promptly give each Shareholder written notice of such determination (in any event within 10 business days after its receipt of notice of any exercise of demand registration rights); provided, however, that such notice of a Piggyback Registration shall be given at least thirty (30) days prior to the anticipated filing date of such Piggyback Registration. Upon the written request of any Shareholder (the "Piggyback Holder") given within ten (10) business days after the providing of any such notice by the Company, the Company shall use its best efforts to cause to be registered under the 1933 Act all of the Registrable Securities held by such Shareholder that the Shareholder has requested to be registered; 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 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 Piggyback Holder and (i) in the case of a determination not to register, shall be relieved of its obligation to register any Registrable Securities in connection with such registration (but not from any obligation of the Company to pay the registration expenses in connection therewith); and (ii) in the case of a determination to delay registering, shall be permitted to delay registering any Registrable Securities for the same period as the delay in registering such other securities. No registration effected under this Section 5.01 shall relieve the Company of its obligation to effect any registration upon demand under Section 5.02. The registration rights contained in Section 5.01 may be assigned to any Transferee or Permitted Transferee. (b) Selection of Underwriters. If any Piggyback Registration involves an underwritten primary offering, the Company shall have sole discretion in the selection of any underwriter or underwriters to manage such Piggyback Registration. (c) Priority on Piggyback Registrations. In the event that the Piggyback Registration includes an underwritten offering, the Company shall so advise the Shareholders as part of the written notice given pursuant to Section 5.01(a) and the registration rights provided in Section 5.01(a) shall be subject to the condition that if the managing underwriter or underwriters of a Piggyback Registration advise the Company in writing (a copy of which shall be provided to the applicable Shareholders) that in its opinion the number of Registrable Securities proposed to be sold in such Piggyback Registration exceeds the number which can be sold, and would materially adversely affect the price at which the Registrable Securities are to be sold, in such offering, the Company (or the Shareholders, as the case may be) will in- -29- clude in such registration only the number of Registrable Securities which, in the opinion of such underwriter or underwriters can be sold in such offering without such material adverse effect. The Registrable Securities so included in such Piggyback Registration shall be apportioned (i) first, either (x) in the case of a primary registration on behalf of the Company, to any shares of Common Stock that the Company proposes to sell, or (y) in the case of a secondary registration on behalf of a Shareholder, pro rata among the Holders on the basis of the number of Registrable Securities requested to be registered pursuant to such Demand Registration, (ii) second, pro rata among the Company Shareholder, RM and the HIP Co-Investors (and their respective Permitted Transferees), but only to the extent of shares of Common Stock of the Company held by them as of the date hereof (as adjusted by the Adjustments), and (iii) third, pro rata among other shares included in such Piggyback Registration, in each case according to the total number of shares of the Common Stock requested for inclusion by said selling stockholders, or in such other proportions as shall mutually be agreed to among such selling stockholders. SECTION 5.02. Demand Registration Rights. (a) Right to Demand. At any time after a Triggering Event, the Demand Holders may (subject in the case of Sponsor to Section 6.01), individually or collectively, make a written request, which request will specify the aggregate number of Registrable Securities to be registered and will also specify the intended methods of disposition thereof (the "Request Notice") to the Company for registration with the Commission under and in accordance with the provisions of the 1933 Act of all or part of the Registrable Securities then owned by Demand Holders (a "Demand Registration"); provided that the Company may, if the Board of Directors so determines in the exercise of its reasonable, good faith judgment that due to a pending or contemplated acquisition or disposition or public offering or other material event involving the Company it would be inadvisable to effect such Demand Registration at such time (but in no event after such registration statement has become effective), the Company may, upon providing the Demand Holders written notice (the "Delay Notice"), defer such Demand Registration for a single period with respect to such Demand Registration not to exceed one hundred thirty five (135) days. Upon receipt by the Company of a request (a "Demand Request") to effect a Demand Registration the Company will within 10 business days after the receipt of such notice, notify each other Demand Holder of such request and such other Demand Holder shall have the option to include its Registrable Securities in such Demand Registration pursuant to this Section 5.02. Subject to Section 5.02(f), the Company will register all other Registrable Securities which the Company has been requested to register by such other Demand Holders (each an "Incidental Demand Holder") pursuant to this Section 5.02 by written request given to the Company by such holders within 10 business days after the giving of such written notice by the Company to such other Demand Holders. The Company shall not be obligated to maintain a registration statement pursuant to a Demand Regis- -30- tration effective for more than (x) ninety (90) days or (y) such shorter period when all of the Registrable Securities covered by such registration statement have been sold pursuant thereto (the "Effectiveness Period"). Notwithstanding the foregoing, the Company shall not be obligated to effect more than one Demand Registration in any 90-day period or such longer period not to exceed 180 days as requested by an underwriter pursuant to Section 5.07. Upon any such request for a Demand Registration, the Company will deliver any notices required by Section 5.01 and 5.02 and thereupon the Company will, subject to Section 5.01(c) and 5.02(f) hereof use its best efforts to effect the prompt registration under the 1933 Act of: (i) the Registrable Securities which the Company has been so requested to register by Demand Holders as contained in the Request Notice, and (ii) all other Registrable Securities which the Company has been requested to register by the Piggyback Holders and Incidental Demand Holders, all to the extent required to permit the disposition of the Registrable Securities so to be registered in accordance with the intended method or methods of disposition of each seller of such Registrable Securities. (b) Number of Demand Registrations. The Company shall not be required to prepare and file a registration statement pursuant to this Section 5.02 if (i) a Rollover Demand Holder and its Direct Permitted Transferees cease to own at the time of making the Request Notice twenty-five percent (25%) or more of the shares of Common Stock of the Company owned as of the date hereof (as adjusted for Adjustments) and (ii) the Request Notice relates to less than twenty-five percent (25%) of the shares of Common Stock held by such Demand Holder. In addition, the Company will not be required to effect more than (i) two registrations pursuant to this Section 5.02 on behalf of Company Shareholder, (ii) one registration on behalf of RM pursuant to this Section 5.02, (iii) two registrations on behalf of CSFB pursuant to this Section 5.02; provided that CSFB will be afforded one additional Demand Registration in the event that CSFB has not been able to dispose of all of the Registrable Securities requested to be registered by CSFB with its initial two Demand Registrations; provided that the Company shall not be obligated to attend or participate in any "road shows" if such third and final Demand Registration is for less than 10% of the shares of Common Stock of the Company owned by CSFB immediately following the Transactions (as adjusted for Adjustments and (iv) one demand on behalf of the QI Demand Holders as a group (other than CSFB) pursuant to this Section 5.02. Sponsor and its Affiliates will be entitled to an unlimited number of Demand Registrations. It being understood that if two or more Demand Holders make a collective Demand Registration, such Demand Registration will count pursuant to this Section 5.02(b) as a Demand Registration for each such Demand Holder. It is hereby acknowledged and agreed by the parties that any Registrable Securities included in a registration statement on behalf of an Incidental Demand Holder will not count as a Demand Registration -31- for such Incidental Demand Holder. In connection with a Demand Registration by more than one Demand Holder or by a Demand Holder and Incidental Demand Holders, such Demand Holders and Incidental Demand Holders shall elect one such Holder to act as representative (the "DH Representative") in connection with such Demand Registration and the Company shall only be obligated to communicate with such DH Representative in connection with such Demand Registration. The Holders shall give the Representative any and all necessary powers of attorneys needed for the DH Representative to act on their behalf. (c) Revocation. Holders of a majority in number of the Registrable Securities to be included in a registration statement pursuant to this Section 5.02 may, at any time prior to the effective date of the registration statement relating to such Demand Registration, acting through their DH Representative revoke such request by providing a written notice thereof to the Company. The Holders of Registrable Securities who revoke such request shall reimburse the Company for all its expenses incurred in the preparation, filing and processing of the Registration Statement. If pursuant to the terms of this Section 5.02(c), the Holders reimburse the Company for its reasonable expenses incurred in the preparation, filing and processing of any registration statement requested and subsequently revoked by such Holders, the attempted registration by such requested and subsequently revoked registration statement shall not be deemed to be a Demand Registration. Notwithstanding the foregoing, the Holders of a majority in number of the Registrable Securities to be included in a registration statement pursuant to this Section 5.02 may, at any time within five days after receipt of any Delay Notice acting through their DH Representative revoke such request by providing written notice thereof to the Company and the attempted Demand Registration shall not be deemed to be a Demand Registration, notwithstanding that such Holders shall not reimburse the Company for any expenses incurred in the preparation, filing and processing of any Registration Statement. (d) Effective Registration. A registration will not count as a Demand Registration: (i) if a Holder determines in its good faith judgment to withdraw the proposed registration of any Registrable Securities requested to be registered by a Demand Holder (x) due to marketing or regulatory reasons subject to such Holder reimbursing the Company for its expenses in accordance with Section 5.02(c) above, or (y) due to a material adverse change in the Company (other than as a result of any action by the Holder); (ii) if such registration is interfered with by any stop order, injunction or other order or requirement of the Commission or other governmental agency or court for any reason (other than as a result of any action by the Holder) and the Company fails to promptly have such stop order, injunction or other order or requirement removed, withdrawn or resolved to the Holder's satisfaction; or (iii) the conditions to closing specified in the underwriting agreement or purchase agreement entered into in connection with the registration relating to any such demand are not satisfied (other than as a result of a default or breach thereunder by the relevant Holder). -32- (e) Selection of Underwriters. If any of the Registrable Securities covered by a Demand Registration are to be sold in an underwritten offering, the relevant Holder, or Holders, will have the right to select the managing underwriter(s) to administer the offering subject to the approval of the Company, which will not be unreasonably withheld. (f) Priority on Demand Registrations. If the managing underwriter or underwriters of a Demand Registration advise the Company in writing that in its or their opinion the number of Registrable Securities proposed to be sold in such Demand Registration exceeds the number which can be sold, or adversely affects the price at which the Registrable Securities are to be sold, in such offering, the Company will include in such registration only the number of Registrable Securities which, in the opinion of such underwriter or underwriters, can be sold in such offering without such material adverse effect. To the extent such Demand Registration includes Registrable Securities of more than one Holder, the Registrable Securities so included in such Demand Registration shall be apportioned (i) first, pro rata among such Holders based upon the number of shares of Common Stock owned by each Holder at the date of determination and (ii) second, pro rata among other shares of Common Stock included in such Demand Registration; provided that if such Demand Registration is effected pursuant to a Demand Request by either Company Shareholder or RM such number of Registrable Securities (as adjusted for Adjustments) of either Company Shareholder or RM that are owned by Company Shareholder and RM immediately following the Transactions will be included first without regard to the pro rata treatment described in clause (i) of this sentence. (g) Assignability of Demand Registration Rights. The rights offered a Shareholder pursuant to Section 5.02 are only assignable to a Direct Permitted Transferee. Notwithstanding the foregoing, CSFB will be able to assign its rights under this Article V to a Transferee that acquires from CSFB at least 25% of the shares of Common Stock owned by CSFB as of the date hereof (as adjusted for Adjustments). Any such assignment permitted hereunder shall be effected hereunder only by giving written notice thereof from both the transferee and the transferee to the Company. SECTION 5.03. Registration Procedures. It shall be a condition precedent to the obligations of the Company and any underwriter or underwriters to take any action pursuant to this Article V that the Shareholders requesting inclusion in any Piggyback Registration or Demand Registration (a "Registration") shall furnish to the Company such information regarding them, the Registrable Securities held by them, the intended method of disposition of such Registrable Securities, and such agreements regarding indemnification, disposition of such securities and other matters referred to in this Article V as the Company shall reasonably request and as shall be required in connection with the action to be taken by the Company. With respect to -33- any Registration which includes Registrable Securities held by a Shareholder, the Company will, subject to Sections 5.01 and 5.02 promptly: (a) Prepare and file with the Commission a registration statement on the appropriate form prescribed by the Commission and use its best efforts to cause such registration statement to become effective as soon as practicable thereafter; provided that the Company shall not be obligated to maintain such registration effective for a period longer than the Effectiveness Period; provided further that before filing a registration statement or prospectus or any amendments or supplements thereto, including documents incorporated by reference after the initial filing of the registration statement, the Company will furnish to the holders of the Registrable Securities covered by such registration statement and the underwriter or underwriters, if any, copies of or drafts of all such documents proposed to be filed, including documents incorporated by reference in the Prospectus and, if required by such holders, the exhibits incorporated by reference, at least three (3) business days prior thereto, which documents will be subject to the reasonable review of such holders and underwriters. Holders will have the opportunity to object to any information pertaining to such holders that is contained therein and the Company will make the corrections reasonably requested by such holders with respect to such information prior to filing any registration statement or amendment thereto or any prospectus or any supplement thereto; provided, however, that the Company will not file any registration statement or amendment thereto or any prospectus or any supplement thereto or any documents required to be incorporated by reference therein to which holders of a majority of the Registrable Securities covered by such registration statement or the underwriters, if any, shall reasonably object; (b) Prepare and file with the Commission such amendments and post-effective amendments to such registration statement and any documents required to be incorporated by reference therein as may be necessary to keep the registration statement effective for a period of not less than the Effectiveness Period (but not prior to the expiration of the time period referred to in Section 4(3) of the 1933 Act and Rule 174 thereunder, if applicable); cause the prospectus to be supplemented by any required prospectus supplement, and as so supplemented to be filed pursuant to Rule 424 under the 1933 Act; and comply with the provisions of the 1933 Act applicable to it with respect to the disposition of all Registrable Securities covered by such registration statement during the applicable period in accordance with the intended methods of disposition by the sellers thereof set forth in such registration statement or supplement to the prospectus; (c) Furnish to such Shareholder, without charge, such number of conformed copies of the registration statement and any post-effective amendment thereto, -34- as such Shareholder may reasonably request, and such number of copies of the prospectus (including each preliminary prospectus) and any amendments or supplements thereto, and any documents incorporated by reference therein as the Shareholder or underwriter or underwriters, if any, may request in order to facilitate the disposition of the securities being sold by the Shareholder (it being understood that the Company consents to the use of the prospectus and any amendment or supplement thereto by the Shareholder covered by the registration statement and the underwriter or underwriters, if any, in connection with the offering and sale of the securities covered by the prospectus or any amendments or supplements thereto); (d) Notify such Shareholder, at any time when a prospectus relating thereto is required to be delivered under the 1933 Act, when the Company becomes aware of the happening of any event as a result of which the prospectus included in such registration statement (as then in effect) contains any untrue statement of material fact or omits to state a material fact necessary to make the statements therein (in the case of the prospectus or any preliminary prospectus, in light of the circumstances under which they were made) not misleading and, as promptly as practicable thereafter, prepare and file with the Commission and furnish a supplement or amendment to such prospectus so that, as thereafter delivered to the investors of such securities, such prospectus will not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; (e) In the case of an underwritten offering, enter into such customary agreements (including underwriting agreements in customary form) and make members of senior management of the Company available on a basis reasonably requested by the underwriters to participate in, "road show" and other customary marketing activities (including one-on-one meetings with prospective purchasers of the Registrable Securities) and cause to be delivered to the underwriters reasonable opinions of counsel to the Company in customary form, covering such matters as are customarily covered by opinions for an underwritten public offering as the underwriters may reasonably request and addressed to the underwriters; (f) Make available, for inspection by any seller of Registrable Securities, any underwriter participating in any disposition pursuant to a registration statement, and any attorney, accountant or other agent retained by any such seller or underwriter, all financial and other records, pertinent corporate documents and properties of the Company, and cause the Company's officers, directors, employees and independent accountants to supply all information reasonably requested by any such seller, underwriter, attorney, accountant or agent that are necessary to be reviewed by such person in connection with the preparation of such registration statement; -35- (g) If requested, cause to be delivered, immediately prior to the effectiveness of the registration statement (and, in the case of an underwritten offering, at the time of delivery of any Registrable Securities sold pursuant thereto), letters from the Company's independent certified public accountants addressed to each selling Shareholder (unless such selling Shareholder does not provide to such accountants the appropriate representation letter required by rules governing the accounting profession) and each underwriter, if any, stating that such accountants are independent public accountants within the meaning of the 1933 Act and the applicable rules and regulations adopted by the Commission thereunder, and otherwise in customary form and covering such financial and accounting matters as are customarily covered by letters of the independent certified public accountants delivered in connection with primary or secondary underwritten public offerings, as the case may be; (h) Provide a transfer agent and registrar for all such Registrable Securities not later than the effective date of the registration statement; (i) Use its best efforts to cause all securities included in such registration statement to be listed, by the date of the first sale of securities pursuant to such registration statement, on any national securities exchange, quotation system or other market on which the Common Stock is then listed or proposed to be listed by the Company, if any; (j) Make generally available to its security holders an earnings statement, which need not be audited, satisfying the provisions of Section 11(a) of the 1933 Act as soon as reasonably practicable after the end of the twelve (12)-month period beginning with the first month of the Company's first fiscal quarter commencing after the effective date of the registration statement, which statement shall cover said twelve (12)-month period; (k) After the filing of a registration statement, (i) promptly notify each Shareholder holding Registrable Securities covered by such registration statement of any stop order issued or, to the Company's knowledge, threatened by the Commission and of the receipt by the Company of any notification with respect to the suspension of the qualification of any Registrable Securities for sale under the applicable securities or blue sky laws of any jurisdiction and (ii) take all reasonable actions to obtain the withdrawal of any order suspending the effectiveness of the registration statement or the qualification of any Registrable Securities at the earliest possible moment; (l) Subject to the time limitations specified in paragraph (b) above, if requested by the managing underwriter or underwriters or such Shareholder, promptly incorporate in a prospectus supplement or post-effective amendment such information as the managing underwriter or underwriters or the Shareholder reasonably requests to -36- be included therein, including, without limitation, with respect to the number of shares being sold by the Shareholder to such underwriter or underwriters, the purchase price being paid therefor by such underwriter or underwriters and with respect to any term of the underwritten offering of the securities to be sold in such offering; and make all required filings of such prospectus supplement or post-effective amendment as soon as practicable after being notified of the matters to be incorporated in such prospectus supplement or post-effective amendment; (m) As promptly as practicable after filing with the Commission of any document which is incorporated by reference into a registration statement, deliver a copy of such document to such Shareholder; (n) On or prior to the date on which the registration statement is declared effective, use its best efforts to register or qualify, and cooperate with such Shareholder, the underwriter or underwriters, if any, and their counsel in connection with the registration or qualification of, the securities covered by the registration statement for offer and sale under the securities or blue sky laws of each state and other jurisdiction of the United States as the Shareholder or managing underwriter or underwriters, if any, requests in writing, to use its best efforts to keep each such registration or qualification effective, including through new filings, or amendments or renewals, during the Effectiveness Period do any and all other acts or things necessary or advisable to enable the disposition in all such jurisdictions of the Registrable Securities covered by the applicable registration statement; provided that the Company will not be required to qualify generally to do business in any jurisdiction where it is not then so qualified or to take any action which would subject it to general service of process in any such jurisdiction where it is not then so subject; (o) Cooperate with such Shareholder and the managing underwriter or underwriters, if any, to facilitate the timely preparation and delivery of certificates (not bearing any restrictive legends) representing securities to be sold under the registration statement, and enable such securities to be in such denominations and registered in such names as the managing underwriter or underwriters, if any, may request; and (p) Use its best efforts to cause the securities covered by the registration statement to be registered with or approved by such other governmental agencies, authorities or self-regulatory bodies within the United States as may be necessary to enable the seller or sellers thereof or the underwriter or underwriters, if any, to consummate the disposition of such Registrable Securities. At all times after an Initial Public Offering, the Company shall file all reports required to be filed by it under the 1933 Act and the 1934 Act and the rules and regulations adopted by the Commission thereunder, and take such further action as any Shareholders may -37- reasonably request, all to the extent required to enable such Shareholders to be eligible to sell Registrable Securities pursuant to Rule 144 (or any similar rule then in effect). The Shareholders, upon receipt of any notice from the Company of the happening of any event of the kind described in subsection (d) of this Section 5.03, will forthwith discontinue disposition of the securities until the Shareholders' receipt of the copies of the supplemented or amended prospectus contemplated by subsection (d) of this Section 5.03 or until it is advised in writing (the "Advice") by the Company that the use of the prospectus may be resumed, and has received copies of any additional or supplemental filings which are incorporated by reference in the prospectus, and, if so directed by the Company, each Shareholder will, or will request the managing underwriter or underwriters, if any, to, deliver, to the Company (at the Company's expense) all copies, other than permanent file copies then in such Shareholder's possession, of the prospectus covering such securities current at the time of receipt of such notice. In the event the Company shall give any such notice, the time periods mentioned in subsections (a), (b) and (n) of this Section 5.03 shall be extended by the number of days during the period from and including any date of the giving of such notice to and including the date when each seller of securities covered by such registration statement shall have received the copies of the supplemented or amended prospectus contemplated by subsection (d) of this Section 5.03 hereof or the Advice. SECTION 5.04. Registration Expenses. (a) Subject to Section 5.02(c), in the case of any Registration, the Company shall bear all expenses incident to the Company's performance of or compliance with Sections 5.01, 5.02 and 5.03 of this Agreement, including, without limitation, all Commission and stock exchange or National Association of Securities Dealers, Inc. registration and filing fees and expenses, fees and expenses of compliance with securities or blue sky laws (including, without limitation, reasonable fees and disbursements of counsel in connection with blue sky qualifications of the Registrable Securities), rating agency fees, printing expenses, messenger, telephone and delivery expenses, fees and disbursements of counsel for the Company and all independent certified public accountants and any fees and disbursements of underwriters customarily paid by issuers or sellers of securities (but not including any underwriting discounts or commissions, or transfer taxes, if any, attributable to the sale of Registrable Securities by a Piggyback Holder or Holder or fees and expenses of more than one counsel representing the Shareholders selling Registrable Securities under such Registration). (b) In connection with each registration initiated hereunder (whether a Demand Registration or a Piggyback Registration), the Company shall reimburse the holders covered by such registration or sale for the reasonable fees and disbursements of one law firm chosen by the holders of a majority of the number of shares of Registrable Securities included in such registration. -38- (c) The obligation of the Company to bear the expenses described in Section 5.04(b) and to reimburse the holders for the expenses described in Section 5.04(b) shall apply irrespective of whether a registration, once properly demanded, if applicable, becomes effective, is withdrawn or suspended, or is converted to another form of registration and irrespective of when any of the foregoing shall occur; provided, however, that the expenses for any registration statement withdrawn pursuant to 5.02(c) prior to its effectiveness at the request of a Holder (unless withdrawn following and due to a Delay Notice), any registration statement withdrawn solely at the request of a Holder, or any supplements or amendments to a registration statement or prospectus resulting from a misstatement furnished to the Company by a Holder, shall be borne by such Holder. SECTION 5.05. Indemnification. (a) Indemnification by the Company. The Company agrees to indemnify and hold harmless each Shareholder, its officers, directors, Affiliates and agents and each Person who controls (within the meaning of the 1933 Act or the 1934 Act) the Shareholder, including, without limitation any general partner or manager of any thereof, against all losses, claims, damages, liabilities and expenses (including reasonable counsel fees and disbursements) arising out of or based upon any untrue or alleged untrue statement of a material fact contained in any registration statement, prospectus or preliminary prospectus, or any amendment thereof or supplement thereto, in which such Shareholder participates in an offering of Registrable Securities or in any document incorporated by reference therein or any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein (in the case of the prospectus or any preliminary prospectus, in light of the circumstances under which they were made) not misleading, except insofar as the same are made in reliance on and in conformity with any information with respect to such Shareholder furnished in writing to the Company by such Shareholder expressly for use therein; provided, however, that the foregoing indemnity agreement with respect to any preliminary prospectus shall not inure to the benefit of any Shareholder from whom the Person asserting such loss, claim, damage or liability purchased the securities if it is determined that such loss, claim, damage or liability was caused by such Shareholder's failure to deliver to such Shareholder's immediate purchaser a current copy of the prospectus (if the current copy of the prospectus was required by applicable law to be so delivered) after the Company has furnished such Shareholder with a sufficient number of copies of such prospectus. The Company will also indemnify underwriters (as such term is defined in the 1933 Act), their officers and directors and each Person who controls such underwriters (within the meaning of the 1933 Act) to the same extent as provided above with respect to the indemnification of the Shareholders. -39- (b) Indemnification by the Shareholders. In connection with any registration statement in which a Shareholder is participating, each such Shareholder will furnish to the Company in writing such information and affidavits with respect to such Shareholder as the Company reasonably requests for use in connection with any registration statement or prospectus covering the Registrable Securities of such Shareholder and to the extent permitted by law agrees to indemnify and hold harmless the Company, its directors, officers and agents and each Person who controls (within the meaning of the 1933 Act or the 1934 Act) the Company, against any losses, claims, damages, liabilities and expenses arising out of or based upon any untrue statement of a material fact or any omission to state a material fact required to be stated therein or necessary to make the statements in the registration statement or prospectus or preliminary prospectus (in the case of the prospectus or preliminary prospectus, in light of the circumstances under which they were made) not misleading, to the extent, but only to the extent, that such untrue statement or omission is made in reliance on and in conformity with the information or affidavit with respect to such Shareholder so furnished in writing by such Shareholder expressly for use in the registration statement or prospectus; provided, however, that the obligation to indemnify shall be several, not joint and several, among such Shareholders and the liability of each such Shareholder shall be in proportion to and limited to the net amount received by such Shareholder from the sale of Registrable Securities pursuant to a registration statement in accordance with the terms of this Agreement. The indemnity agreement contained in this Section 5.05 shall not apply to amounts paid in settlement of any such loss, claim, damage, liability, action or proceeding if such settlement is effected without the consent of such seller (which consent shall not be unreasonably withheld or delayed). The Company and the holders of the Registrable Securities hereby acknowledge and agree that, unless otherwise expressly agreed to in writing by such holders, the only information furnished or to be furnished to the Company for use in any registration statement or prospectus relating to the Registrable Securities or in any amendment, supplement or preliminary materials associated therewith are statements specifically relating to (a) transactions or the relationship between such holder and its Affiliates, on the one hand, and the Company, on the other hand, (b) the beneficial ownership of shares of Common Stock by such holder and its Affiliates, (c) the name and address of such holder and (d) any additional information about such holder or the plan of distribution (other than for an underwritten offering) required by law or regulation to be disclosed in any such document. (c) Conduct of Indemnification Proceedings. Any Person entitled to indemnification hereunder will (i) give prompt written notice to the indemnifying party of any claim with respect to which it seeks indemnification and (ii) unless in such indemnified party's reasonable judgment a conflict of interest may exist between such indemnified and indemnifying parties with respect to such claim, permit such indemnifying party to assume the defense of such claim with counsel reasonably satisfactory to the indemnified party. The failure to so notify the indemnifying party shall not relieve the indemnifying party from any liability hereunder with respect to the action, except to the extent that such indemnifying party -40- is materially prejudiced by the failure to give such notice; provided, however, that any such failure shall not relieve the indemnifying party from any other liability which it may have to any other party. No indemnifying party in the defense of any such claim or litigation, shall, except with the consent of such indemnified party, which consent shall not be unreasonably withheld, consent to entry of any judgment or enter into any settlement which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a release from all liability in respect of such claim or litigation. An indemnifying party who is not entitled to, or elects not to, assume the defense of a claim will not be obligated to pay the fees and expenses of more than one counsel for all parties indemnified by such indemnifying party with respect to such claim, unless in the reasonable judgment of any indemnified party there may be one or more legal or equitable defenses available to such indemnified party which are in addition to or may conflict with those available to any other of such indemnified parties with respect to such claim, in which event the indemnifying party shall be obligated to pay the reasonable fees and expenses of such additional counsel or counsels; provided, however, that such number of additional counsel must be reasonably acceptable to the indemnifying party. (d) Contribution. If for any reason the indemnification provided for in the preceding paragraphs (a) and (b) of this Section 5.05 is unavailable to an indemnified party as contemplated by the preceding paragraphs (a) and (b) of this Section 5.05, then the indemnifying party shall contribute to the amount paid or payable by the indemnified party as a result of such loss, claim, damage or liability in such proportion as is appropriate to reflect not only the relative benefits received by the indemnified party and the indemnifying party, but also the relative fault of the indemnified party and the indemnifying party, as well as any other relevant equitable considerations. In no event shall the liability of any selling Shareholder be greater in amount than the amount of net proceeds received by such Shareholder upon such sale or the amount for which such indemnifying party would have been obligated to pay by way of indemnification if the indemnification provided in paragraph (b) of this Section 5.05 had been available. SECTION 5.06. 1934 Act Reports. The Company agrees that at all times after it has filed a registration statement pursuant to the requirements of the 1933 Act relating to any class of equity securities of the Company, it will use its best efforts to file in a timely manner all reports required to be filed by it pursuant to the 1934 Act to the extent the Company is required to file such reports. Notwithstanding the foregoing, the Company may deregister any class of its equity securities under Section 12 of the 1934 Act or suspend its duty to file reports with respect to any class of its securities pursuant to Section 15(d) of the 1934 Act if it is then permitted to do so pursuant to the 1934 Act and rules and regulations thereunder. -41- SECTION 5.07. Holdback Agreements. (a) Whenever the Company proposes to register any of its equity securities under the 1933 Act for its own account (other than on Form S-4 or S-8 or any similar successor form or another form used for a purpose similar to the intended use of such forms) or is required to use its best efforts to effect the registration of any Registrable Securities under the 1933 Act pursuant to Section 5.01 or 5.02, each holder of Registrable Securities agrees by acquisition of such Registrable Securities not to effect any sale or distribution, including any sale pursuant to Rule 144 under the 1933 Act, or to request registration under Section 5.02 of any Registrable Securities within 10 days prior to and 90 days (unless advised by the managing underwriter that a longer period, not to exceed 180 days, is required, or such shorter period as the managing underwriter for any underwritten offering may agree) after the effective date of the registration statement relating to such registration, except as part of such registration or unless in the case of a private sale or distribution, the transferee agrees in writing to be subject to this Section 5.07. If requested by such managing underwriter, each holder of Registrable Securities agrees to execute a holdback agreement, in customary form, consistent with the terms of this Section 5.07(a). Notwithstanding the foregoing, no Shareholder will be restricted from selling any Registrable Securities if such Shareholder was not able to sell all of its Registrable Securities pursuant to such registration statement or such Shareholder and its Affiliates beneficially own a number of shares of Common Stock as of such date of determination equal to less than three percent (3%) of the outstanding Common Stock of the Company. (b) The Company agrees not to effect any sale or distribution of any of its equity securities or securities convertible into or exchangeable or exercisable for any of such securities within the 10 days prior to and during the 90 days (unless advised by the managing underwriter that a longer period, not to exceed 180 days, is required, or such shorter period as the managing underwriter for any underwritten offering may agree) beginning on the effective date of any underwritten Demand Registration or any underwritten Piggyback Registration (except as part of such underwritten registration or pursuant to registrations on Form S-8 or S-4 or any successor forms thereto), except that such restriction shall not prohibit (i) grants of employee stock options or other issuances of Capital Stock pursuant to the terms of a Company employee benefit plan, issuances by the Company of Capital Stock pursuant to the exercise of such options or the exercise of any other employee stock options outstanding on the date hereof, (ii) the Company from issuing shares of Capital Stock in private placements pursuant to Section 4(2) of the 1933 Act or in connection with a strategic alliance, or (iii) the Company from publicly announcing its intention to issue, or actually issuing, shares of Capital Stock to shareholders of another entity as consideration for the Company's acquisition of, or merger with, such entity. In addition, upon the request of the managing underwriter, the Company shall use its best efforts to cause each holder of its equity securities or any securities convertible into or exchangeable or exercisable for any of such securities whether outstanding on the date of this Agreement or issued at any time after the date of this Agreement (other -42- than any such securities acquired in a public offering), to agree not to effect any such public sale or distribution of such securities during such period, except as part of any such registration if permitted, and to cause each such holder to enter into a similar agreement to such effect with the Company. SECTION 5.08. Participation in Registrations. No Shareholder may participate in any Registration hereunder which is underwritten unless such Shareholder (a) agrees to sell its 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, underwriting agreements and other documents customarily required under the terms of such underwriting arrangements. SECTION 5.09. Remedies. Each Shareholder shall have the right and remedy to have the provisions of Sections 5.01 and 5.02 specifically enforced by any court having jurisdiction in the event that the Company materially breaches such provisions, and the Company shall reimburse such Shareholder for the reasonable costs of and expenses for counsel for such Shareholder incurred in connection with such proceeding. SECTION 5.10. Other Registration Rights. The Company will not grant any Person any demand or piggyback registration rights with respect to the Capital Stock of the Company other than registration rights that would not be in conflict or inconsistent with the rights of the Shareholders as set forth in this Article V. SECTION 5.11. Rule 144. The Company shall file any reports required to be filed by it under the 1933 Act and the 1934 Act and the rules and regulations adopted by the Commission thereunder, and it will take such further action as any holder may reasonably request to make available adequate current public information with respect to the Company meeting the current public information requirements of Rule 144(c) under the 1933 Act, to the extent required to enable such holder to sell Registrable Securities without registration under the 1933 Act within the limitation of the exemptions provided by (i) Rule 144 under the 1933 Act, as such Rule may be amended from time to time, or (ii) any similar rule or regulation hereafter adopted by the Commission. Notwithstanding the foregoing, nothing in this Section 5.11 shall be deemed to require the Company to register any of its securities pursuant to the 1934 Act. -43- ARTICLE VI RIGHTS OF HOLDERS OF CLASS A PREFERRED STOCK SECTION 6.01. Series A Preferred Stock. For so long as Company Shareholder or one of its Affiliates is the direct or indirect beneficial owner of at least $10.0 million in liquidation preference of Class A Preferred Stock, the Company will not (1) register for sale in any underwritten public offering any shares of Common Stock beneficially owned by Sponsor and its Affiliates or (2) redeem or repurchase any shares of Common Stock beneficially owned by Sponsor and its Affiliates out of the proceeds of any underwritten public offering by the Company, in any such case, without optionally redeeming or repurchasing all of the shares of Class A Preferred Stock owned by Company Shareholder and its Affiliates; provided, however, that if the Company has no such right to optionally redeem or repurchase all of the shares of Class A Preferred Stock, then the Company, at its option, may offer to purchase for cash all of the Class A Preferred Stock held by Company Shareholder and its Affiliates at a price equal to the liquidation preference of the Class A Preferred Stock, together with cumulated and unpaid dividends. The provisions of this Section 6.01 will no longer be operative once the Company has made such offer regardless of whether or not the Company Shareholder sells any shares of Class A Preferred Stock pursuant to such offer unless such offer is not effected because the Company does not purchase the shares of Class A Common Stock which Company Shareholder has requested be purchased. SECTION 6.02. Management Fee. For so long as Company Shareholder or any of its Affiliates is the direct or indirect beneficial owner of any Class A Preferred Stock, Sponsor agrees that any management fee due and owning to Sponsor by the Company will accrue but not be payable if at any time there are cumulated and unpaid dividends in respect of the Class A Preferred Stock. ARTICLE VII MISCELLANEOUS SECTION 7.01. Notices. All notices, requests and other communications to any party, hereunder shall be in writing (including bank wire, telex, facsimile or similar writing) and shall be given to such party at its address or telex or facsimile number set forth on the signature pages hereof or in the relevant Joinder Agreement or such other address or telex or facsimile number as such party may hereafter specify in writing to the Secretary of the Company for the purpose by notice to the party sending such communication. Each such notice, request or other communication shall be effective (i) if given by telex or facsimile, when such message is transmitted to the number -44- specified on the signature pages to this Agreement or any Joinder Agreement, (ii) if given by mail, three (3) business days after such communication is deposited in the mails registered or certified, return receipt requested, with postage prepaid, addressed as aforesaid, or (iii) if given by any other means, when delivered at the address specified on the signature pages to this Agreement or any Joinder Agreement. SECTION 7.02. Binding Effect; Benefits; Entire Agreement. This Agreement shall be binding upon and inure to the benefit of the parties to this Agreement and their respective successors and permitted assigns. Nothing in this Agreement, express or implied, is intended or shall be construed to give any person other than the parties to this Agreement or their respective successors or assigns any legal or equitable right, remedy or claim under or in respect of any agreement or any provision contained herein. This Agreement constitutes the entire agreement and understanding, and supersedes all prior agreements and understandings, both oral and written, between the parties hereto relating to the subject matter hereof. SECTION 7.03. Waiver. Any party hereto may by written notice to the other (a) extend the time for the performance of any of the obligations or other actions of any other party under this Agreement; (b) waive compliance with any of the conditions or covenants of any other party contained in this Agreement; and (c) waive or modify performance of any of the obligations of any other party under this Agreement. Except as provided in the preceding sentence, no action taken pursuant to this Agreement, including, without limitation, any investigation by or on behalf of any party, shall be deemed to constitute a waiver by the party taking such action of compliance with any representations, warranties, covenants or agreements contained herein. The waiver by any party hereto of a breach of any provision of this Agreement shall not operate or be construed as a waiver of any preceding or succeeding breach and no failure by any party to exercise any right or privilege hereunder shall be deemed a waiver of such party's rights or privileges hereunder or shall be deemed a waiver of such party's rights to exercise the same at any subsequent time or times hereunder. SECTION 7.04. Amendment. Other than as a result of the execution and delivery of a Joinder Agreement, this Agreement may not be amended, modified or supplemented in any respect except by a written instrument executed by each Shareholder and the Company; provided that this Agreement may be amended and restated or amended without consent of Shareholders for the addition of new shareholders after the date hereof if such addition does not adversely affect the rights of the Shareholders (it being agreed that the provision of demand registration rights and piggyback registration rights and tag-along rights on an equal basis with HIP Co-Investors will not constitute an adverse affect). -45- SECTION 7.05. Assignability. Neither this Agreement nor any right, remedy, obligation or liability arising hereunder or by reason hereof shall be assignable by either the Company or any Shareholder except as otherwise expressly stated hereunder or with the prior written consent of each other party. A Direct Permitted Transferee who executes a Joinder Agreement in accordance with the provisions hereof may be assigned any rights available hereunder (other than Section 4.06). All of the rights offered a Shareholder under this Agreement who executes a Joinder Agreement are assignable to a Transferee, except for the rights set forth in Sections 4.05, 4.06, 4.07, 4.08, 4.09, 4.10 and 5.02 (other than certain rights granted to CSFB pursuant to Section 5.02). The rights set forth in Sections 4.04 and 5.02 are assignable to a Transferee who executes a Joinder Agreement to the extent provided in Section 4.04 and 5.02(g), respectively. SECTION 7.06. Applicable Law. This Agreement shall be governed by and construed in accordance with the laws of the State of New York, regardless of the laws that might otherwise govern under applicable principles of conflicts of law that would require the application of the laws of another jurisdiction, and the parties irrevocably submit to (and waive immunity from) the jurisdiction of the federal and state courts located in the County of New York in the State of New York. SECTION 7.07. Specific Performance. The parties hereto agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties shall be entitled to an injunction or injunctions to prevent breaches of the provisions of this Agreement and to enforce specifically the terms and provisions hereof in any state or federal court of New York (this being in addition to any other remedy to which they are entitled at law or in equity), and each party hereto agrees to waive in any action for such enforcement the defense that a remedy at law would be adequate. SECTION 7.08. Severability. If any provision of this Agreement is declared by any court of competent jurisdiction to be illegal, void or unenforceable, all other provisions of the Agreement will not be affected and will remain in full force and effect. SECTION 7.09. Additional Securities Subject to Agreement. Each Shareholder agrees that any other shares of Common Stock of the Company which it hereafter acquires by means of a stock split, stock dividend, distribution, exercise of options or warrants or otherwise (other than pursuant to a public offering) whether by merger, consolidation or otherwise (including shares of a surviving corporation into which the shares of Common Stock of the Company are exchanged in such transaction) will be subject to the provisions of this Agree- -46- ment to the same extent as if held on the date hereof, including for purposes of constituting Registrable Securities hereunder. SECTION 7.10. Name Change. For the benefit of Company Shareholder, the Company agrees to change its corporate name (but not the trade names used by its businesses) to exclude "Masco" or a derivation thereof from its corporate name prior to consummating an Initial Public Offering of its Common Stock. SECTION 7.11. Section and Other Headings. The section and other headings contained in this Agreement are for reference purposes only and shall not affect the meaning or interpretation of this Agreement. SECTION 7.12. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original and all of which together shall be deemed to be one and the same instrument. A facsimile, telecopy or other reproduction of this Agreement may be executed by one or more parties hereto, and an executed copy of this Agreement may be delivered by one or more parties hereto by facsimile or similar instantaneous electronic transmission device pursuant to which the signature of or on behalf of such party can be seen, and such execution and delivery shall be considered valid, binding and effective for all purposes. At the request of any party hereto, all parties hereto agree to execute an original of this Agreement as well as any facsimile, telecopy or other reproduction hereof. SECTION 7.13. Termination of Certain Provisions. The provisions of this Agreement set forth in Sections 3.01, 3.02, 4.01, 4.02, 4.03, 4.04(b) (except as it relates to CSFB and Company Shareholder), 4.04(d) (except as it relates to CSFB and Company Shareholder) and 4.09 will terminate and be of no force and effect upon the occurrence of a Qualifying Public Equity Offering. The provisions of this Agreement set forth in Sections 4.04(a) (except as it relates to CSFB and Company Shareholder) and 4.05 will terminate and be of no force and effect upon the occurrence of an Initial Public Offering. The provisions of this Agreement set forth in Sections 4.04 (insofar as it relates to CSFB and Company Shareholder), 4.06, 4.07, 4.08 and 4.10 will terminate as to a particular Shareholder as set forth in such section. SECTION 7.14. ERISA Matters. The Company agrees to give Sponsor the rights set forth in Sections 4.07 and 4.08 to the extent Sponsor does not have the ability to designate a Person to the Board of Directors of the Company and failure to have the rights set forth in Section 4.07 or 4.08 would cause Sponsor to have an ERISA Problem. For purposes of this Section 7.14, "ERISA Problem" -47- means that the assets of Sponsor and its Affiliates would be considered "Plan Assets" within the meaning of 29 CFR 2510.3-101 due to the fact that Sponsor and its Affiliates do not have the rights specified in Section 4.07 or 4.08. SECTION 7.15. Regulatory Cooperation. If any Shareholder reasonably determines that, by reason of any existing or future federal or state rule, regulation, guideline, order, request or directive (whether or not having the force of law and whether or not failure to comply therewith would be unlawful) (collectively, a "Regulatory Requirement"), it is effectively restricted or prohibited from holding any of the shares of Common Stock (including any shares of Capital Stock or other securities distributable in any merger, reorganization, readjustment or other reclassification of such shares), the Company and the other Shareholders shall take such action as may be reasonably necessary to permit such Shareholder to comply with such Regulatory Requirement; provided, that no such action pursuant to this Section 7.15 shall adversely affect the Company, the rights of the other Shareholders hereunder or the rights, preferences, qualifications and limitations of any Capital Stock of the Company held by the other Shareholders; provided, further that neither the Company nor any Shareholder shall be required to purchase any of such shares of Common Stock as a result of such Regulatory Requirement. Such reasonable action to be taken may include the Company's authorization of one or more new classes of non-voting common stock that is otherwise substantially identical to the Common Stock then owned by such Shareholder and the amendment of the Company's certificate of incorporation or any other documents or instruments executed in connection with the shares held by such Shareholder. Such Shareholder shall give written notice to the Company and the other Shareholders of any such determination and the actions necessary to comply with such Regulatory Requirement, and the Company and such other Shareholders shall take all reasonably necessary steps to comply with such determination as expeditiously as possible. SECTION 7.16. Publicity. None of the parties hereto shall issue any press release or make any public disclosure regarding the transactions contemplated hereby unless such press release or public disclosure shall be approved by those parties mentioned in such press release or public disclosure in advance. Notwithstanding the foregoing, each of the parties hereto may, in documents required to be filed by it with the Commission or other regulatory bodies, make such statements with respect to the transactions contemplated hereby as each may be advised by counsel is legally necessary or advisable, and may make such disclosure as it is advised by its counsel is required by law. SECTION 7.17. Expenses. The Company agrees, if the Transactions are consummated, to reimburse each Qualified Investor for all reasonable out-of-pocket expenses arising in connection with the Transactions promptly (including, without limitation, and, in any event, within 30 days after any invoice or -48- other statement or notice), including all reasonable documented fees and expenses of counsel to such Qualified Investor incurred in connection with this Agreement and the transactions contemplated hereby and all reasonable out-of-pocket expenses incurred by such Qualified Investor for so long as such Person is a Qualified Investor in connection with the monitoring of its equity investment in the Company. [Signature Pages Follow] IN WITNESS WHEREOF, the Company and each Shareholder have executed this Agreement as of the day and year first above written. MASCOTECH, INC. By: /s/ David B. Liner -------------------------------------- Name: David B. Liner Title: Vice President Notices: 21001 Van Born Road Taylor, Michigan 48140 Attention: Chairman of the Board and General Counsel Facsimile: (313) 792-4107 With a copy to: Cahill Gordon & Reindel 80 Pine Street New York, New York 10005 Attention: Jonathan A. Schaffzin, Esq. Facsimile: (212) 269-5420 MASCO CORPORATION By: John R. Leekley --------------------------------------- Name: John R. Leekley Title: Senior Vice President Notices: 21001 Van Born Road Taylor, Michigan 48140 Attention: Chairman of the Board and General Counsel Facsimile: (313) 792-4107 With a copy to: Honigman Miller Schwartz and Cohn 2290 First National Building Detroit, Michigan 48226 Attention: Alan Stuart Schwartz, Esq. Facsimile: (313) 465-7575 RICHARD A. MANOOGIAN By: /s/ Richard A. Manoogian --------------------------------------- Notices: Richard A. Manoogian c/o Masco Corporation 21001 Van Born Road Taylor, Michigan 48140 Attention: Richard A. Manoogian Facsimile: (313) 792-6134 with a copy to: Bodman Longley & Dahling LLP 100 Renaissance Center Detroit, Michigan 48243 Attention: David M. Hempstead, Esq. Facsimile: (313) 393-7579 RICHARD AND JANE MANOOGIAN FOUNDATION By: /s/ Richard A. Manoogian --------------------------------------- Name: Richard A. Manoogian Title: President Notices: Richard and Jane Manoogian Foundation c/o Masco Corporation 21001 Van Born Road Taylor, Michigan 48140 Attention: Richard A. Manoogian Facsimile: (313) 792-6134 with a copy to: Eugene A. Gargaro, Jr., Esq. c/o Masco Corp. 21001 Van Born Road Taylor, Michigan 48140 Facsimile: (313) 792-6289 HEARTLAND ENTITY: HEARTLAND INDUSTRIAL PARTNERS, L.P. By: Heartland Industrial Associates L.L.C., its General Partner By: /s/ David A. Stockman ---------------------------------------- Name: David A. Stockman Title: Managing Member Notices: Heartland Industrial Partners, L.P. 320 Park Avenue, 33rd Floor New York, New York 10022 Attention: David A. Stockman Facsimile: (212) 981-3535 and 55 Railroad Avenue Greenwich, Connecticut 06830 Attention: David A. Stockman Facsimile: (203) 861-2722 With a copy to: Cahill Gordon & Reindel 80 Pine Street New York, New York 10005 Attention: Jonathan A. Schaffzin, Esq. Facsimile: (212) 269-5420 HEARTLAND ENTITY: HEARTLAND INDUSTRIAL PARTNERS (FF), L.P. By: Heartland Industrial Associates L.L.C., its General Partner By: /s/ David A. Stockman ---------------------------------------- Name: David A. Stockman Title: Managing Member Notices: Heartland Industrial Partners, L.P. 320 Park Avenue, 33rd Floor New York, New York 10022 Attention: David A. Stockman Facsimile: (212) 981-3535 and 55 Railroad Avenue Greenwich, Connecticut 06830 Attention: David A. Stockman Facsimile: (203) 861-2722 With a copy to: Cahill Gordon & Reindel 80 Pine Street New York, New York 10005 Attention: Jonathan A. Schaffzin, Esq. Facsimile: (212) 269-5420 HEARTLAND ENTITY: HEARTLAND INDUSTRIAL PARTNERS (E1), L.P. By: Heartland Industrial Associates L.L.C., its General Partner By: /s/ David A. Stockman --------------------------------------- Name: David A. Stockman Title: Managing Member: Notices: Heartland Industrial Partners, L.P. 320 Park Avenue, 33rd Floor New York, New York 10022 Attention: David A. Stockman Facsimile: (212) 981-3535 and 55 Railroad Avenue Greenwich, Connecticut 06830 Attention: David A. Stockman Facsimile: (203) 861-2722 With a copy to: Cahill Gordon & Reindel 80 Pine Street New York, New York 10005 Attention: Jonathan A. Schaffzin, Esq. Facsimile: (212) 269-5420 HEARTLAND ENTITY: HEARTLAND INDUSTRIAL PARTNERS (K1), L.P. By: Heartland Industrial Associates L.L.C., its General Partner By: /s/ David A. Stockman --------------------------------------- Name: David A. Stockman Title: Managing Member Notices: Heartland Industrial Partners, L.P. 320 Park Avenue, 33rd Floor New York, New York 10022 Attention: David A. Stockman Facsimile: (212) 981-3535 and 55 Railroad Avenue Greenwich, Connecticut 06830 Attention: David A. Stockman Facsimile: (203) 861-2722 With a copy to: Cahill Gordon & Reindel 80 Pine Street New York, New York 10005 Attention: Jonathan A. Schaffzin, Esq. Facsimile: (212) 269-5420 HEARTLAND ENTITY: HEARTLAND INDUSTRIAL PARTNERS (C1), L.P. By: Heartland Industrial Associates L.L.C., its General Partner By: /s/ David A. Stockman --------------------------------------- Name: David A. Stockman Title: Managing Member: Notices: Heartland Industrial Partners, L.P. 320 Park Avenue, 33rd Floor New York, New York 10022 Attention: David A. Stockman Facsimile: (212) 981-3535 and 55 Railroad Avenue Greenwich, Connecticut 06830 Attention: David A. Stockman Facsimile: (203) 861-2722 With a copy to: Cahill Gordon & Reindel 80 Pine Street New York, New York 10005 Attention: Jonathan A. Schaffzin, Esq. Facsimile: (212) 269-5420 LONG POINT CAPITAL FUND, L.P. By: /s/ Ira Starr --------------------------------------- Name: Ira Starr Title: Managing Director Notices: 767 Fifth Avenue New York, New York 10153 Attention: Ira Starr Facsimile: (212) 593-1888 With a copy to: Proskauer Rose LLP 1585 Broadway New York, NY 10036-8299 Attention: Peter Samuels, Esq. Facsimile: (212) 969-2900 LONG POINT CAPITAL PARTNERS, L.L.C. By: /s/ Ira Starr --------------------------------------- Name: Ira Starr Title: Managing Director Notices: 767 Fifth Avenue New York, New York 10153 Attention: Ira Starr Facsimile: (212) 593-1888 With a copy to: Proskauer Rose LLP 1585 Broadway New York, NY 10036-8299 Attention: Peter Samuels, Esq. Facsimile: (212) 969-2900 CRM 1999 ENTERPRISE FUND, LLC By: /s/ Jay Abramson --------------------------------------- Name: Jay Abramson Title: Exec. VP of Managing Member Notices: 520 Madison Avenue 32nd Floor New York, NY 10022 Attention: Edward Azimi Facsimile: (212) 371-3562 HIP CO-INVESTOR: KLEINWORT BENSON HOLDINGS, INC. By: /s/ Iain Leigh --------------------------------------- Name: Iain Leigh Title: Authorized Person By: /s/ John Walker --------------------------------------- Name: John Walker Title: Authorized Person Notices: 75 Wall Street 34th Floor New York, NY 10005 Attention: Alexander P. Coleman Adam Lichtenstein Facsimile: (212) 429-3139 With a copy to Kirkland & Ellis 153 East 53rd Street 39th Floor New York, NY 10022 Attention: Eunu Chun Facsimile: (212) 446-4900 HIP CO-INVESTOR: 75 WALL STREET ASSOCIATES, LLC By: Kleinwort Benson (USA), Inc. Its: Attorney-in-Fact By: /s/ Iain Leigh --------------------------------------- Name: Iain Leigh Title: Authorized Person By: /s/ John Walker --------------------------------------- Name: John Walker Title: Authorized Person Notices: 75 Wall Street 34th Floor New York, NY 10005 Attention: Alexander P. Coleman Adam Lichtenstein Facsimile: (212) 429-3139 With a copy to Kirkland & Ellis 153 East 53rd Street 39th Floor New York, NY 10022 Attention: Eunu Chun Facsimile: (212) 446-4900 HIP CO-INVESTOR: METROPOLITAN LIFE INSURANCE COMPANY By: /s/ James A. Wiviott --------------------------------------- Name: James A. Wiviott Title: Director Notices: Metropolitan Life Insurance Company Corporate Equities 334 Madison Avenue Convent Station, NJ 07961 Attention: Susan M. Garret Facsimile: (973) 254-3055 With a copy to: Metropolitan Life Insurance Company One Madison Avenue New York, NY 10010 Attention: Todd S. Shenkin, Esq. (Law, Area 6H) Facsimile: (212) 251-1673 and Metropolitan Life Insurance Company 4100 Boy Scout Boulevard Tampa, FL 33607 Attention: Desiree DiSalvo - Securities Accounting Facsimile: (813) 801-2506 HIP CO-INVESTOR: FIRST UNION CAPITAL PARTNERS, LLC By: /s/ A. Wellford Tabor --------------------------------------- Name: A. Wellford Tabor Title: Principal Notices: First Union Capital Partners One First Union Center, 12th Floor 301 South College Street Charlotte, NC 28288-0732 Attention: A. Wellford Tabor Facsimile: (704) 374-6711 With a copy to: Kennedy Covington Lobdell & Hickman, L.L.P. 100 North Tryon Street, Suite 4200 Charlotte, NC 28202-4006 Attention: Kevin P. Stichter Facsimile: (704) 331-7598 HIP CO-INVESTOR: GE CAPITAL EQUITY INVESTMENTS, INC. By: /s/ William R. Kraus -------------------- Name: William R. Kraus Title: SVP Notices: GE Capital Equity Investments, Inc. 120 Long Ridge Road Stamford, CT 06927 Attention: Barbara J. Gould, Esq. Facsimile: (203) 357-3047 Attention: William R. Kraus Facsimile: (203) 357-6426 With a copy to: Winston & Strawn 200 Park Avenue New York, NY 10166 Attention: David B. Hertzog, Esq. Facsimile: (212) 294-4700 HIP CO-INVESTOR: CREDIT SUISSE FIRST BOSTON U.S. EXECUTIVE ADVISORS, L.P. By: /s/ Hartley R. Rogers --------------------------------------- Name: Hartley R. Rogers Title: Attorney-in-Fact Notices: Credit Suisse First Boston U.S. Executive Advisors, L.P. c/o Credit Suisse First Boston Advisory Partners, LLC Eleven Madison Avenue New York, New York 10010 Attention: Hartley R. Rogers Facsimile: (212) 325-2291 With a copy to: Skadden, Arps, Slate, Meagher & Flom LLP Four Times Square New York, New York 10036 Attention: Eileen T. Nugent Facsimile: (212) 735-2000 HIP CO-INVESTOR: CREDIT SUISSE FIRST BOSTON EQUITY PARTNERS (BERMUDA), L.P. By: /s/ Hartley R. Rogers --------------------------------------- Name: Hartley R. Rogers Title: Attorney-in-Fact Notices: Credit Suisse First Boston Equity Partners (Bermuda), L.P. c/o Credit Suisse First Boston Advisory Partners, LLC Eleven Madison Avenue New York, New York 10010 Attention: Hartley R. Rogers Facsimile: (212) 325-2291 With a copy to: Skadden, Arps, Slate, Meagher & Flom LLP Four Times Square New York, New York 10036 Attention: Eileen T. Nugent Facsimile: (212) 735-2000 HIP CO-INVESTOR: CREDIT SUISSE FIRST BOSTON EQUITY PARTNERS, L.P. By: /s/ Hartley R. Rogers --------------------------------------- Name: Hartley R. Rogers Title: Attorney-in-Fact Notices: Credit Suisse First Boston Equity Partners, L.P. c/o Credit Suisse First Boston Advisory Partners, LLC Eleven Madison Avenue New York, New York 10010 Attention: Hartley R. Rogers Facsimile: (212) 325-2291 With a copy to: Skadden, Arps, Slate, Meagher & Flom LLP Four Times Square New York, New York 10036 Attention: Eileen T. Nugent Facsimile: (212) 735-2000 HIP CO-INVESTOR: EMA PARTNERS FUND 2000, L.P. By: /s/ Hartley R. Rogers --------------------------------------- Name: Hartley R. Rogers Title: Attorney-in-Fact Notices: EMA Partners Fund 2000, L.P. c/o Credit Suisse First Boston Advisory Partners, LLC Eleven Madison Avenue New York, New York 10010 Attention: Hartley R. Rogers Facsimile: (212) 325-2291 With a copy to: Skadden, Arps, Slate, Meagher & Flom LLP Four Times Square New York, New York 10036 Attention: Eileen T. Nugent Facsimile: (212) 735-2000 EMA PRIVATE EQUITY FUND 2000, L.P. By: /s/ Hartley R. Rogers --------------------------------------- Name: Hartley R. Rogers Title: Attorney-in-Fact EMA Private Equity Fund 2000, L.P. c/o Credit Suisse First Boston Advisory Partners, LLC Eleven Madison Avenue New York, New York 10010 Attention: Hartley R. Rogers Facsimile: (212) 325-2291 With a copy to: Skadden, Arps, Slate, Meagher & Flom LLP Four Times Square New York, New York 10036 Attention: Eileen T. Nugent Facsimile: (212) 735-2000 MERCHANT CAPITAL, INC. By: /s/ Edward Nadel --------------------------------------- Name: Edward Nadel Title: Vice President Merchant Capital, Inc. Eleven Madison Avenue New York, New York 10010 Attention: Edward Nadel Facsimile: (212) 325-1659 HIP CO-INVESTOR: BANCBOSTON CAPITAL INC. By: /s/ Mark H. DeBlois --------------------------------------- Name: Mark H. DeBlois Title: Managing Director Notices: BancBoston Capital Inc. 175 Federal Street, 10th Floor Boston, MA 02210 Attention: Daniel C. Reese Facsimile: (617) 434-1153 With a copy to: Bingham Dana LLP 150 Federal Street Boston, MA 02110-1726 Attention: Robert M. Wolf Facsimile: (617) 951-8736 PRIVATE EQUITY PORTFOLIO FUND II, LLC By: Fleet Bank, NA, its Manager By: /s/ Glen Holland --------------------------------------- Name: Glen Holland Title: Director Notices: BancBoston Capital Inc. 175 Federal Street, 10th Floor Boston, MA 02210 Attention: Daniel C. Reese Facsimile: (617) 434-1153 With a copy to: Bingham Dana LLP 150 Federal Street Boston, MA 02110-1726 Attention: Robert M. Wolf Facsimile: (617) 951-8736 EXHIBIT A JOINDER AGREEMENT WHEREAS, the undersigned is acquiring simultaneously with the execution of this Agreement common stock (the "Common Stock"), par value $1.00 per share of MascoTech, Inc. (the "Company"); and WHEREAS, as a condition to the acquisition of the Common Stock, the undersigned has agreed to join in a certain Stockholders Agreement (the "Stockholders Agreement") dated as of November 28, 2000 among MascoTech, Inc. and the Shareholders (as such term is defined in the Stockholders Agreement); and WHEREAS, the undersigned understands that execution of this Agreement is a condition precedent to the acquisition of the Common Stock; NOW, THEREFORE, as an inducement to both the transferor of the Common Stock and the other Shareholders (as such term is defined in the Stockholders Agreement), to Transfer (as such term is defined in the Stockholders Agreement) and to allow the Transfer of the Common Stock to the undersigned, the undersigned agrees as follows: 1. The undersigned hereby joins in the Stockholders Agreement and agrees to be bound by the terms and provisions of the Stockholders Agreement as provided by the Stockholders Agreement. 2. The undersigned hereby consents that the certificate or certificates to be issued to the undersigned representing the Common Stock shall be legended as follows: "THE SECURITIES REPRESENTED BY THIS CERTIFICATE MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO (i) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED, OR (ii) AN APPLICABLE EXEMPTION FROM REGISTRATION THEREUNDER. ANY SALE PURSUANT TO CLAUSE (ii) OF THE PRECEDING SENTENCE MUST BE ACCOMPANIED BY AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE COMPANY TO THE EFFECT THAT SUCH EXEMPTION FROM REGISTRATION IS AVAILABLE IN CONNECTION WITH SUCH SALE. THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO THE TERMS AND CONDITIONS, INCLUDING WITH RESPECT TO THE DIRECT OR INDIRECT TRANSFER THEREOF, OF A SHAREHOLDERS AGREEMENT DATED AS OF NOVEMBER 28, 2000. THE SHAREHOLDERS AGREEMENT CONTAINS, AMONG OTHER -2- THINGS, SIGNIFICANT RESTRICTIONS ON TRANSFER OF THE SECURITIES OF THE COMPANY. A COPY OF THE SHAREHOLDERS AGREEMENT IS AVAILABLE UPON REQUEST FROM THE COMPANY." IN WITNESS WHEREOF, the undersigned has executed this Agreement this ____ day of _______________, 20__. ---------------------------------------- Name: Title: Address: EXHIBIT B Representatives of CSFB Hartley R. Rogers Phone: (212) 325-4618 Fax: (212) 325-2291 Jay Finney Phone: (212) 325-4622 Fax: (212) 325-5553 Lee Wright Phone: (212) 325-2762 Fax: (212) 325-5553 SCHEDULE 2.04 Shareholder Common Shares Heartland Entities 12,261,251 Richard Manoogian 621,170* Richard and Jane Manoogian Foundation 661,260 Masco Corporation 2,492,248 Kleinwort Benson Holdings, Inc. 591,716 75 Wall Street Associates LLC 295,858 Metropolitan Life Insurance Company 591,716 First Union Capital Partners LLC 1,479,290 GE Capital Equity Investments Inc. 591,716 Credit Suisse First Boston Equity Partners, L.P. 6,247,530 Credit Suisse First Boston Equity Partners, (Bermuda) L.P. 1,746,345 Credit Suisse First Boston U.S. Executive Advisors, L.P. 5,558 EMA Partners Fund 2000, L.P. 533,168 EMA Private Equity Fund 2000, L.P. 343,139 Merchant Capital, Inc. 177,515 BancBoston Capital Inc. 769,231 Private Equity Portfolio Fund II, LLC 118,343 ___________ * Exclusive of 49,215 shares of restricted stock that will vest on the closing date of the Transactions (assuming no cash elections) and 147,645 shares of unvested restricted stock. -2- Shareholder Common Shares Long Point Capital Fund L.P. 581,025 Long Point Capital Partners LLC. 10,692 CRM Enterprises Fund, LLC 59,172 -----END PRIVACY-ENHANCED MESSAGE-----