Exhibit 10.9
FORM OF
SALE PARTICIPATION
AGREEMENT
November ,
2005
To:
The Person whose name is
set forth on the signature page hereof
Dear Sir or Madam:
You have entered into a Management
Stockholder’s Agreement, dated as of the date hereof between
Accellent Holdings Corp., a Delaware corporation (the “
Company ”), and you (the “
Stockholder’s Agreement ”) relating to
(i) the granting to you by the Company of Options (as defined
in the Stockholder’s Agreement) to purchase shares of common
stock, par value $0.01 per share, of the Company (the “
Common Stock ”) and, where applicable, (ii) the
purchase by you of the Purchased Stock (as defined in the
Stockholder’s Agreement). The undersigned, Accellent
Holdings LLC, a Delaware limited liability company (the “
Investor ”), hereby agrees with you as follows,
effective upon your execution of the Rollover Agreement with the
Company:
1.
In the event that at any time the
Investor (together with any of its respective affiliates, to the
extent provided for in Paragraph 8 hereof, the “ Selling
Investors ”) proposes to sell for cash or any other
consideration any shares of Common Stock owned by it, in any
transaction other than a Public Offering (as defined in the
Stockholder’s Agreement) or a sale to an affiliate of the
Selling Investors, the Selling Investor(s) will notify you or your
Management Stockholder’s Estate or Management
Stockholder’s Trust (as such terms are defined in
Section 7(c) of the Stockholder’s Agreement, and
collectively with you, the “ Management Stockholder
Entities ”), as the case may be, in writing (a “
Notice ”) of such proposed sale (a “ Proposed
Sale ”) and the material terms including, without
limitation, the representations, warranties, indemnification and
other agreements, of the Proposed Sale as of the date of the Notice
(the “ Material Terms ”) promptly, and in any
event not less than 15 days prior to the consummation of the
Proposed Sale and not more than 5 days after the execution of the
definitive agreement relating to the Proposed Sale, if any (the
“ Sale Agreement ”). If, within 10 days
after the Management Stockholder Entities’ receipt of such
Notice, the Selling Investor receives from the Management
Stockholder Entities a written request (a “ Request
”) to include Common Stock held by the Management Stockholder
Entities in the Proposed Sale (which Request shall be irrevocable
unless (a) there shall be a material change in the Material
Terms or (b) otherwise mutually agreed to in writing by the
Management Stockholder Entities and the Selling Investor), the
Common Stock held by you will be so included as provided herein;
provided that only one Request, which shall be executed by the
Management Stockholder Entities, may be delivered with respect to
any single Proposed Sale for Common Stock held by the Management
Stockholder Entities. Promptly after the execution of the
Sale Agreement, the Selling Investors will furnish the Management
Stockholder Entities with a copy of the Sale Agreement, if
any.
2.
(a) The number of shares of
Common Stock which the Management Stockholder Entities will be
permitted to include in a Proposed Sale pursuant to a Management
Stockholder Request will be the sum of the number of shares of
Common Stock then actually owned (or deemed owned) by the
Management Stockholder Entities plus all shares of Common
Stock which you are then entitled to acquire under any unexercised
portion of the Options, to the extent such Options are then
exercisable or would become exercisable as a result of the
consummation of the Proposed Sale, multiplied by a fraction (x) the
numerator of which shall be the aggregate number of shares of
Common Stock which a Selling Investor or the Selling Investors
propose to sell in the Proposed Sale (after giving effect to the
applicable provisions of the Stockholder’s Agreement and any
other written agreement between the Selling Investors and any
holder of shares of Common Stock that gives the right to such
holder to participate in the Proposed Sale (each, including the
Management Stockholder Entities, an “ Eligible Holder
”)) and (y) the denominator of which shall be the total
number of shares of Common Stock owned by such Selling Investor or
the Selling Investors, as the case may be.
(b) If one or more Eligible
Holders elect not to include the maximum number of shares of Common
Stock which such holders would have been permitted to include in a
Proposed Sale pursuant to Paragraph 2(a) (such non-included
shares, the “ Eligible Shares ”), then each of
the Selling Investors, or the remaining Eligible Holders, or any of
them, will have the right to sell in the Proposed Sale a number of
additional shares of their Common Stock equal to their pro rata
portion of the number of Eligible Shares, based on the relative
number of shares of Common Stock then actually held (or deemed
held) by each such holder plus all shares of Common Stock
which such holder is then entitled to acquire under any unexercised
portion of the Options, to the extent such Options are then
exercisable or would become exercisable as a result of the
consummation of the Proposed Sale, and such additional shares of
Common Stock which any such holder or holders propose to sell shall
be included in any calculation made pursuant to this Paragraph 2
for the purpose of determining the number of shares of Common Stock
which the Management Stockholder Entities will be permitted to
include in a Proposed Sale. The Selling Investors, the
Eligible Holders, or any of them, will have the right to sell in
the Proposed Sale additional shares of Common Stock owned by them
equal to the number, if any, of remaining Eligible Shares which
will not be included in the Proposed Sale pursuant to the
foregoing.
(c) In the event that the per
share consideration to be received by the Selling Investors
pursuant to a Sale Agreement (the “ Sale Price
”) is less than the Base Price (as defined in the
Stockholder’s Agreement), then, the Management Stockholder
Entities shall be paid a cash bonus in an amount so that the
Management Stockholder Entities would suffer the same percentage
loss on the original difference between the exercise price of the
“Rollover Option” and the “Base Price” (as
those terms are defined in the Stockholder’s Agreement), as
the percentage loss realized by the Selling Investors pursuant to
the sale of its shares under such Sale Agreement; provided ,
however , that such bonus shall only be paid if the payment
of such bonus would not result in taxation or penalty under
Section 409A of the Internal Revenue Code of 1986, as
amended. Such amount shall be calculated in accordance with
Schedule A hereto.
3.
Except as may otherwise be provided
herein, shares of Common Stock subject to a Request will be
inc
