Form Of 1998 Pc Connection Voting Trust Agreement

EXHIBIT 9.1


FORM OF
1998 PC CONNECTION VOTING TRUST AGREEMENT
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THIS AGREEMENT, made as of the ___ day of February, 1998, by and among Patricia Gallup ("Gallup"), David Hall ("Hall") (Gallup and Hall being hereinafter referred to from time to time collectively as the "Founders"), Gallup and Hall, as trustees of the voting trust created by this voting trust agreement (the "Trustees") and PC Connection, Inc., a Delaware corporation (the "Corporation"),


W I T N E S S E T H T H A T


WHEREAS, Gallup and Hall own beneficially certain shares of the Corporation's common stock, $.01 par value ("Common Stock"), and have deposited with the Trustee to be held in trust under this Agreement [ ] shares (the "Gallup Shares") and [ ] shares (the "Hall Shares") of such Common Stock, respectively;


WHEREAS, the Founders believe that it is in the best interest of the stockholders of the Corporation to provide for continuity in the management and stock ownership of the Corporation;


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


1. Name. The trust created by this Agreement shall be known as the 1998 PC
---- Connection Voting Trust.


2. Transfer of Stock to the Trustees.
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(a) Each Founder agrees to deliver to the Trustees, to be held pursuant to this Agreement, all but 20,000 shares of Common Stock or other securities of the Corporation now owned by such Founder.


(b) The Gallup Shares and Hall Shares initially deposited in trust with the Trustees under this Agreement, together with all other shares of capital stock of the Corporation deposited from and after the date hereof with the Trustees under this Agreement, whether pursuant to Subsection 2(a) above, or by reason of the payment of dividends by the Corporation in capital stock of the Corporation, a reorganization or recapitalization of the Corporation or otherwise, are hereinafter referred to as the "Restricted Securities." The Trustees shall hold the Restricted Securities subject to the terms of this Agreement and of that certain lock-up agreement entered into by each of Hall and Gallup with Donaldson, Lufkin & Jenrette Securities Corporation, NationsBanc Montgomery Securities, Inc. and William Blair & Company (the "Underwriters") in connection with the Corporation's initial public offering (the "Lock-Up Agreement").


(c) All certificates for Restricted Securities transferred and delivered to the Trustees pursuant to this Agreement shall be surrendered by the Trustees to the Corporation and shall be


cancelled on the books of the Corporation, and new certificates therefor shall be issued by the Corporation to the Trustees in the name of "Patricia Gallup and David Hall, as Trustees under the 1998 PC Connection Voting Trust." All certificates representing Restricted Securities issued to the Trustee under this Agreement shall have endorsed thereon, in addition to any other legends thereon, a legend in substantially the following form:


The securities represented by this certificate are subject to
restrictions on voting and transfer set forth in a 1998 PC Connection
Voting Trust Agreement dated as of February __, 1998 between Patricia
Gallup and David Hall, individually and as Trustees, and the
Corporation, a copy of which will be provided by the Corporation to any
holder of this certificate upon request and without charge.


3. Voting Trust Certificates.
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(a) Notwithstanding the delivery to the Trustees by a Founder of the certificate or certificates for their respective Restricted Securities, such Founder shall (subject to any transfer otherwise permitted hereunder) continue to be the beneficial owner of the Restricted Securities so deposited by such Founder with the Trustee. (The beneficial interest of a Founder, or of a Permitted Transferee of such Founder, in a share of any Restricted Security delivered to the Trustees hereunder may hereinafter be referred to as a "Beneficial Share.") Each Beneficial Share shall be evidenced by a voting trust certificate or certificates (the "Voting Trust Certificates"), and the Trustees shall issue and deliver or cause to be delivered to such Founder a Voting Trust Certificate evidencing his or her beneficial ownership of such Beneficial Shares. All such Voting Trust Certificates shall be in substantially the form of Exhibit A hereto.
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(b) Each registered holder of a Voting Trust Certificate shall be entitled to receive copies of all notices of meetings, annual or periodic reports to the Corporation's stockholders or other materials distributed by the Corporation generally to the holders of any class of securities of which any outstanding shares constitute Restricted Securities ("Stockholder Information"), and the Trustees shall, upon their receipt from the Corporation of any Stockholder Information in respect of Restricted Securities held subject to this Agreement, promptly mail copies of such Stockholder Information to each such holder of a Voting Trust Certificate at his or her address as shown on the books of the Trustees. Each Founder acknowledges and agrees that the rights and powers of the Trustees hereunder, including, without limitation, those rights and powers set forth in Sections 10 and 11 below, shall not be affected by any failure of the Trustee to comply with the provisions of this Subsection 3(b).


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4. Provisions Regarding Transfer of Restricted Securities and
---------------------------------------------------------- Beneficial Shares. - -----------------


(a) During the term of this Agreement, neither Founder shall, except as otherwise permitted by Subsection 4(b) below, sell, assign, convey, pledge, encumber, hypothecate, subject to any call, option or agreement to purchase or otherwise transfer any of the Restricted Securities or Beneficial Shares, whether or not standing in his or her name, or any interest therein, or agree or purport to do any of the foregoing.


(b) Notwithstanding the foregoing, the following transactions shall not be deemed to be prohibited by this Section 4 (each a "Permitted Transfer"):


(i) A transfer of Beneficial Shares by either Founder made
(A) as a charitable donation, gift or otherwise without separate
consideration, or for estate planning purposes, to any member of
his or her family or any other person or entity, or to a trust for
the benefit of such Founder or such family member, person or
entity (any transferee of a Founder described in this clause (A)
being hereinafter referred to as a "Permitted Transferee") or (B)
to the other Founder; provided, however, that any Beneficial
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Shares so transferred shall remain subject to the Lock-Up
Agreement to the extent applicable during its term and to this
Voting Trust Agreement for as long as such Agreement remains in
force.


(ii) Subject to Subsection 4(d) below, a transfer of
Restricted Securities by either Founder or by a Permitted
Transferee of such Founder in a bona fide transfer for value to a
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third party unaffiliated with the transferor (a "Sale"), which
Sale is not prohibited by the Lock-Up Agreement or is made with
the consent of the Underwriters pursuant to the Lock-Up Agreement,
in which event the third party shall hold the Restricted
Securities so transferred free of the Lock-Up Agreement and of the
Voting Trust created hereby and shall be entitled to receive from
the Corporation a certificate registered in such name as the third
party shall designate. The Trustees hereby agree to issue and
deliver to the Corporation or its transfer agent such certificates
and instructions and to take such other actions as may be
necessary on their part to effect the Sale and registration in the
name of a third party pursuant to this Subsection 4(b)(ii).


(iii) A pledge of Restricted Securities to a bank or other
financial institution as collateral security for the obligations
of either Founder under an arrangement with such bank or financial
institution in which the Founder simultaneously establishes both
put and call positions with respect to the Common Stock of the
Corporation (a "Collateralized Collar") shall be deemed to
constitute a Sale pursuant to Subsection 4(b)(ii) above. Upon
receipt by the Trustees of (A) written notice from a Founder that
he or she intends to enter into a Collateralized Collar, setting
forth the terms of such Collateralized Collar and (B) if such
notice is given during


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the term of the Lock-Up Agreement, the written consent of the
Underwriters to the pledge, to the extent required, such Founder
shall be entitled to receive a certificate representing the
pledged shares registered in such name as he or she shall
designate and free of any restrictive legend (except as otherwise
required by law). The bank or other financial institution, and any
of its transferees, shall hold the pledged shares free of the
Lock-Up Agreement, the Voting Trust and any other restrictions on
transfer or voting of the pledged shares created by this
Agreement.


(c) It shall be a further condition to any transfer made pursuant to Subsection 4(b)(i)(A) above that the transferee, if not already a party to this Agreement, shall execute and deliver to the Trustees an instrument in form and substance satisfactory to the Trustees evidencing the agreement of such transferee to become a party to and be bound by this Agreement and the Lock-Up Agreement during its term. Each Founder agrees, as a further condition to any transfer made by him or her pursuant to Subsection 4(b)(iii) above, that to the extent that he or she has the power to direct the voting of any shares of Common Stock held by any bank or other financial institution pursuant to a Collateralized Collar he or she will direct that such shares be voted in accordance with the written instructions of the Trustees; provided, that such bank or financial institution shall not have any obligation to determine independently whether such any direction given by such Founder is in conformity with any instructions of the Trustees.


(d) Notwithstanding the foregoing, if a Sale by either Founder (which term shall be deemed to include, solely for purposes of this Subsection 4(d), any Permitted Transferee of such Founder) pursuant to Subsection 4(b)(ii) above would (A) when aggregated with all other Sales effected by such Founder during the 90-day period preceding such Sale involve the transfer of an aggregate of 50,000 or more Restricted Securities, or (B) result in the Trustees holding in the aggregate less than a majority of the then issued and outstanding Common Stock of the Corporation (including, as issued and outstanding, for purposes of this Subsection 4(d) any shares of Common Stock issuable upon conversion of any then issued and outstanding security of the Corporation that is convertible into Common Stock) (in each case, a "Restricted Sale"), such Restricted Sale may be effected only in compliance with this Subsection 4(d). A Founder proposing to effect a Restricted Sale (an "Offering Founder") shall first notify the other Founder (the "Offeree Founder") in writing of the number of Restricted Securities proposed to be transferred, the proposed manner of sale and, if such transfer is to be made other than in a "broker's transaction" or "transaction directly with a market maker" (as each such term is defined in Rule 144 ("Rule 144") promulgated by the Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended (the "Securities Act")), the identity of the proposed transferee and the proposed price at which the Restricted Sale is to be effected (an "Offer Notice"). Such Offer Notice shall constitute a binding offer to sell to the Offeree Founder, for cash, the Restricted Securities described in the Offer Notice at the price specified therein, or, if no such price is specified, at a price per share equal to the last sale price of the Common Stock as reported by the Nasdaq National Market on the date on which the Offer Notice is given. If the Offeree Founder shall not, within ten business days of the giving of the Offer Notice (the "First Refusal Period"), notify the Offering Founder in writing that the Offer Notice is accepted (which notice shall be accompanied by the tender of payment in full of the purchase price of the offered Restricted Securities), then the Offering Founder shall be free (subject however to any restrictions


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on trading in Common Stock arising by law, regulation or policy of the Corporation), during the Corporation's fiscal quarter in which the First Refusal Period expires, to effect the Restricted Sale, upon the terms set forth in the Offer Notice.


(e) The Founders acknowledge that they have been advised that their sales of Common Stock may be required to be aggregated for purposes of the volume limitations of Rule 144. Each Founder agrees that he or she (i) will make a good faith effort to notify the other prior to any Sale of Common Stock (including any transfer of Restricted Securities pursuant to Subsection 4(b)(ii) or (iii) above, and whether or not such Sale is subject to Rule 144), and (ii) will not, without the prior written consent of the other, effect any such Sale of Common Stock that would cause the aggregate number of shares of Common Stock so transferred by such Founder during any three-month period to exceed one-half of the aggregate number that would be permitted to be sold by both Founders during such three-month period under Rule 144(e). The Founders further acknowledge that they have been advised that each collateralized option written by them in connection with the establishment of a Collateralized Collar pursuant to Subsection 4(b)(iii) above may be deemed to constitute a separate sale of the underlying shares for purposes of the volume limitations of Rule 144.


(f) The Trustees shall keep a record of Voting Trust Certificates and shall be entitled to rely conclusively upon said record as to the identity and address of the holders of Voting Trust Certificates. The Trustees may treat the registered holder of each Voting Trust Certificate as the owner thereof and of the Beneficial Shares evidenced thereby for all purposes whatsoever, but the Trustee shall not be required to deliver certificates for Restricted Securities as required hereunder without the surren ...