EXHIBIT 6
VESTAR EQUITY PARTNERS, L.P.
000 Xxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
March 5, 1997
Harvard Private Capital Holdings, Inc.
c/o Harvard Private Capital Group, Inc.
000 Xxxxxxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxx Xxxxxx
American Industrial Partners Capital Fund II, L.P.
c/o American Industrial Partners
Xxx Xxxxxxxx Xxxxx
Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000
Attention: Xxx Xxxxxxx
Gentlemen:
Reference is hereby made to (i) the Stock Purchase Agreement, dated as of
March 5, 1997 (the "Stock Purchase Agreement"), among Scandinavian Incentive
Holdings, B.V. ("SIH"), Incentive AB ("Incentive"), Vestar Equity Partners, L.P.
("Vestar"), Harvard Private Capital Holdings, Inc. ("Harvard"), American
Industrial Partners Capital Fund II, L.P. ("AIP"), and the individuals
identified on the signature pages thereto as Management Purchasers (the
"Management Purchasers"), pursuant to which, among other things, each of Vestar,
Harvard, AIP and the Management Purchasers have agreed to purchase from SIH
shares of common stock, par value $.01 per share (the "Common Stock"), of
Westinghouse Air Brake Company ("WABCO"), on the terms and subject to the
conditions contained therein, and (ii) the Amended and Restated Stockholders
Agreement, dated as of March 4, 1997 (as amended, supplemented or otherwise
modified from time to time, the "Stockholders Agreement"), among WABCO, the
Voting Trust (as defined therein), Vestar, Harvard and AIP, and joined in for
certain limited purposes by Vestar Capital Partners, Inc., Xxxxxxx X. Xxxxxxxx,
Xxxxxx X. Xxxxxxxxx and certain other persons named therein, pursuant to which,
among other things, the parties to the Stockholders Agreement have agreed to
certain restrictions on the transfer of Common Stock owned or held by them, on
the terms and subject to the conditions contained therein.
In consideration of each of Vestar, Harvard and AIP agreeing to enter into
the Stock Purchase Agreement and the Stockholders Agreement and of the promises
and mutual covenants hereinafter set forth, each of Vestar, Harvard and AIP
hereby agree as follows:
1. Additional Stock Transfer Restrictions. (a) Except as permitted by
clause (b) or (c) below or required by clause (d) below, each of Vestar, Harvard
and AIP agree that, in addition to the restrictions on the transfer of Common
Stock by Vestar, Harvard and AIP
contained in the Stockholders Agreement, neither Vestar, Harvard nor AIP shall
sell, transfer, assign, mortgage, change, hypothecate, give away or otherwise
dispose of (collectively, "transfer") any Common Stock owned or held by it
without the prior written consent of (i) in the case of any transfer by Vestar,
Harvard, (ii) in the case of any transfer by Harvard, Vestar, and (iii) in the
case of any transfer by AIP, each of Vestar and Harvard; provided that if any
party hereto transfers a percentage of the Common Stock owned or held by it,
each of the other parties hereto may transfer the same percentage of the Common
Stock owned or held by it in separate transactions or as provided in the Common
Stock Registration Rights Agreement among the parties hereto, WABCO and certain
other persons.
(b) Notwithstanding the provisions contained in clause (a) above (but in
any event subject to the provisions contained in the Stockholders Agreement),
each of Vestar, Harvard and AIP shall be permitted to transfer any Common Stock
owned or held by it without any prior written consent as required above, if such
transfer is to any Affiliate (as defined in the Stockholders Agreement), other
than (i) in the case of Vestar or AIP, an Affiliate that is a limited partner of
Vestar or AIP, as the case may be, and (ii) in the case of Harvard, an Affiliate
that is a stockholder of Harvard that does not control or wholly own Harvard,
directly or indirectly.
(c) If Vestar and Harvard propose to transfer Common Stock owned or held
by them in accordance with the exceptions set forth in Sections 5.2.1(x) or
5.2.1(z) of the Stockholders Agreement and clause (a) above (but not clause (b)
above), Vestar and Harvard shall have the obligation, and AIP shall have the
right, to require the proposed transferee to purchase from AIP up to a number of
shares of Common Stock equal to the product of (i) the total number of shares of
Common Stock beneficially owned by AIP and (ii) a fraction the numerator of
which is the total number of shares of Common Stock held by Vestar and Harvard
which are actually included in the contemplated transfer and the denominator of
which is the aggregate number of shares of Common Stock beneficially owned by
Vestar and Harvard. Such purchase shall be made at the same price per share of
Common Stock and otherwise upon the same terms and conditions applicable to
Vestar and Harvard. Vestar and Harvard shall give notice to AIP of each proposed
transfer giving rise to AIP's tag-along rights hereunder at least 30 days prior
to the proposed consummation of such transfer, setting forth the number of
shares of Common Stock proposed to be so transferred, the name and address of
the proposed transferee, the proposed amount and form of consideration and other
terms and conditions of payment offered by the proposed transferee, and a
representation that the proposed transferee has been informed of AIP's tag-along
rights under this clause (c) and has agreed to purchase shares of Common Stock
in accordance with the terms hereof. The tag-along rights provided by this
clause (c) must be exercised by AIP within 10 days following receipt of the
notice required by the preceding sentence, by delivery of a written notice to
Vestar and Harvard indicating AIP's desire to exercise its tag-along rights and
specifying the number of shares of Common Stock it desires to sell. If the
proposed transferee fails to purchase from AIP shares of Common Stock with
respect to which it has properly exercised its tag-along rights hereunder, then
Vestar and Harvard shall not be permitted to make the proposed transfer.
(d) If Vestar and Harvard receive an offer from a third party which is not
an Affiliate of either Vestar or Harvard to purchase all of the shares of Common
Stock owned by Vestar and Harvard and such offer is accepted by Vestar and
Harvard, then AIP hereby agrees, upon the written request of Vestar and Harvard,
that it will transfer all shares of Common Stock owned by it to such purchaser
on the same terms and subject to the same conditions
3
applicable to Vestar and Harvard; provided that such purchase must not be in
violation of the Stockholders Agreement; and provided further that AIP will not
be required to make any representations or warranties regarding WABCO.
(e) If either Vestar or Harvard proposes to transfer Common Stock owned or
held by it in accordance with the exceptions set forth in Section 5.2.1(y) or
Section 5.2.3 of the Stockholders Agreement, it shall give AIP hereto written
notice of such proposed transfer at the time Vestar or Harvard gives notice to
the other of such proposed transfer and in any event at least three (3) business
days prior to the consummation of such proposed transfer.
(f) The provisions contained in this Section 1 shall apply from the date
hereof until March 31, 2001.
2. Agreement to Select Director for each Board Committee. Each of Vestar
and Harvard agree that, in connection with their collective right pursuant to
the Stockholders Agreement to select a director designated by either Vestar or
Harvard to be seated on each committee of WABCO's Board of Directors, they shall
in good faith make such selection or selections as are necessary to cause such
committee seat to be filled in a timely manner.
3. Miscellaneous. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. No modification, change
or amendment of the terms of this Agreement shall be binding on the parties
hereto unless reduced to writing and duly executed by the parties hereto which
hold or own at least 66-2/3% of the then outstanding shares of Common Stock
subject to the provisions of this Agreement; provided that no modification,
change or amendment hereto which adversely affects any party hereto
disproportionately from the other parties hereto shall be binding on such first
party without its prior consent. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware and such laws
shall also govern in the settlement by arbitration or otherwise of any and all
disputes arising between the parties hereto. This Agreement shall become
effective upon the occurrence of the Closing under the Stock Purchase Agreement.
4
Please indicate your confirmation of this Agreement by executing the
enclosed copy of this letter and delivering it to Vestar.
Very truly yours,
VESTAR EQUITY PARTNERS, L.P.
By: Vestar Associates, L.P.
Its: General Partner
By: Vestar Associates Corporation
Its: General Partner
By: /s/ Xxxxx X. Xxxxxx
------------------------------
Name: Xxxxx X. Xxxxxx
Title:
Agreed to and accepted as of
the date first written above:
HARVARD PRIVATE CAPITAL HOLDINGS, INC.
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Name: Xxxx X. Xxxxx
Title: Authorized Signatory
By: /s/ Xxxxxxx X. Xxxxxxxx
-------------------------------------
Name: Xxxxxxx X. Xxxxxxxx
Title: Authorized Signatory
AMERICAN INDUSTRIAL PARTNERS CAPITAL
FUND II, L.P.
By: American Industrial Partners II, L.P.
Its: General Partner
By: American Industrial Partners Corporation
Its: General Partner
By: /s/ Xxxxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxxxx X. Xxxxxx
Title: Chairman