Call Rights. (i) Except as provided in paragraphs (ii) and (iii) of this Section 3(b), in the event the Management Stockholder’s Employment with the Company terminates for any reason prior to the Agreement Termination Date (as hereinafter defined), the Company (or its designated assignee) shall have the right, during the 180-day period following the later to occur of (A) such termination of Employment and (B) the date on which the Management Stockholder or Transferee has held the Shares most recently acquired to be sold pursuant to this Section 3(b)(i) for at least six (6) months, to purchase from the Management Stockholder or the Management Stockholder’s Transferee, and upon the exercise of such right the Management Stockholder or such Transferee shall sell to the Company (or its designated assignee), all or any portion of the Shares held by the Management Stockholder or Transferee as of the date as of which such right is exercised at a per Share price equal to the Fair Market Value of a share of Common Stock determined as of the date such right is exercised, provided that if such termination of the Management Stockholder’s Employment occurs due to the Management Stockholder’s death or Disability or is effected by the Company without Cause or by the Management Stockholder for Good Reason, the call right described in this paragraph (i) shall not apply with respect to such Management Stockholder’s Rollover Shares. (ii) In the event that either the Management Stockholder’s Employment with the Company is terminated for Cause or the Management Stockholder violates any of the restrictive covenants set forth in the Plan or in any equity award grant agreement under the Plan: (A) in either case prior to the Agreement Termination Date, the Company (or its designated assignee) shall have the right, during the 180-day period following the latest to occur of (x) such termination of Employment, (y) such violation of a restrictive covenant and (z) the date on which the Management Stockholder or Transferee has held the Shares most recently acquired to be sold pursuant to this Section 3(b)(ii) for at least six (6) months, to purchase from the Management Stockholder or the Management Stockholder’s Transferee, and upon the exercise of such right the Management Stockholder or such Transferee shall sell to the Company (or its designated assignee), all or any portion of the Shares held by the Management Stockholder or Transferee as of the date as of which such right is exercised at a per Share price equal to (I) in the case of a Rollover Share, the Fair Market Value of such Share determined as of the date such right is exercised or (II) in the case of an Option Share, the lesser of (a) the Fair Market Value of a share of Common Stock determined as of the date such right is exercised or (b) the exercise price per Share paid by the Management Stockholder to acquire such Share; or (B) in either case following the Agreement Termination Date, the Management Stockholder shall be obligated to pay to the Company an amount equal to the amount which, as a result of such Management Stockholder’s exercise of Options at any time following, or within one year prior to, the date of termination of his or her Employment, such Management Stockholder was required to recognize as income for U.S. federal income tax purposes (or would have been required to recognize as income if the Management Stockholder was subject to U.S. federal income taxes). (iii) In the event that the Management Stockholder resigns from Employment with the Company without Good Reason prior to the fifth anniversary of the Effective Time, the Company (or its designated assignee) shall have the right, during the 180-day period following the later to occur of (A) such termination of Employment and (B) the date on which the Management Stockholder or Transferee has held the Shares most recently acquired to be sold pursuant to this Section 3(b)(iii) for at least six (6) months, to purchase from the Management Stockholder or the Management Stockholder’s Transferee, and upon the exercise of such right the Management Stockholder or such Transferee shall sell to the Company (or its designated assignee), all or any portion of the Shares held by the Management Stockholder or Transferee as of the date as of which such right is exercised at a per Share price equal to (I) in the case of a Rollover Share, the Fair Market Value of a share of Common Stock determined as of the date such right is exercised or (II) in the case of an Option Share, an amount equal to (a) the Fair Market Value of a share of Common Stock determined as of the date such right is exercised less (b) the amount equal to 20% of the amount (if any) by which the Fair Market Value of a share of Common Stock determined as of the date such right is exercised exceeds the Exercise Price per share of Common Stock (as defined under the Plan or any successor plan). (iv) The Company (or its designated assignee) shall exercise the call rights described in this Section 3(b) by delivering to the Management Stockholder or Transferee, as applicable, a written notice specifying its intent to purchase Shares held by the Management Stockholder or Transferee (the “Call Notice”) and the number of Shares to be purchased. The Company’s call right shall be deemed exercised as of the date on which the Company delivers such Call Notice to the Management Stockholder or Transferee. Such purchase and sale shall occur on such date as the Company (or its designated assignee) shall specify, which date shall be no later than forty-five (45) days after the end of the fiscal quarter in which the Call Notice is delivered. The Company will use commercially reasonable efforts to make the payment for the Shares in cash on the date of such purchase and sale; provided that, despite using such efforts, if such payment will result in the violation of the terms or provisions of, or result in a default or event of default under, any guarantee, financing or security agreement or document entered into by the Company or any of its Affiliates and in effect on such date (hereinafter a “Financing Agreement”), the Company may delay any such payment for no more than two (2) years. In the event the payment of the purchase price is delayed as a result of a restriction imposed by a Financing Agreement as provided above, such payment shall be made without the application of further conditions or impediments as soon as practicable after the payment of such purchase price would no longer result in the violation of the terms or provisions of, or result in a default or event of default under, any Financing Agreement, and such payment shall equal the amount that would have been paid to the Management Stockholder or Transferee if no delay had occurred plus interest for the period from the date on which the purchase price would have been paid but for the delay in payment provided herein to the date on which such payment is made (the “Delay Period”), calculated at an annual rate equal to the average annual prime rate charged during the Delay Period by a nationally recognized bank designated by the Board plus two (2) percentage points. In the event that the Company is not able to make payment within two (2) years after the date specified in the Call Notice, the Company will, upon the written request of the Management Stockholder or Transferee, cancel the Call Notice and return to the Management Stockholder or Transferee the Shares subject to the Call Notice (as adjusted to take into account any corporate transactions during the intervening period) in exchange for cancellation of the debt and any interest payments that would otherwise have been payable thereon. (v) In the event that the Company exercises its call right to purchase Shares from the Management Stockholder under Section 3(b)(i) or Section 3(b)(iii) and, following the date that the Company pays the Management Stockholder the applicable purchase price for such Shares, the Management Stockholder violates any of the restrictive covenants set forth in the Plan or in any equity award grant agreement under the Plan, the Management Stockholder or the Management Stockholder’s Transferee shall pay to the Company, within ten (10) business days following the date of such violation, an amount equal to (A) the amount the Company paid the Management Stockholder or Transferee to purchase such Shares less (B) the amount the Company would have been required to pay the Management Stockholder or Transferee for such Shares if the Company had purchased the Shares pursuant to Section 3(b)(ii)(A).
Appears in 5 contracts
Samples: Management Stockholders’ Agreement, Management Stockholders’ Agreement (LVB Acquisition, Inc.), Management Stockholders’ Agreement (LVB Acquisition, Inc.)
Call Rights. (i) Except as provided in paragraphs (ii) and (iii) of this Section 3(b), in the event the Management Stockholder’s Employment with the Company terminates for any reason prior to the Agreement Termination Date (as hereinafter defined), the Company (or its designated assignee) shall have the right, during the 180-day period following the later to occur of (A) such termination of Employment and (B) the date on which the Management Stockholder or Transferee has held the Shares most recently acquired to be sold pursuant to this Section 3(b)(i) for at least six (6) months, to purchase from the Management Stockholder or the Management Stockholder’s Transferee, and upon the exercise of such right the Management Stockholder or such Transferee shall sell to the Company (or its designated assignee), all or any portion of the Shares held by the Management Stockholder or Transferee as of the date as of which such right is exercised at a per Share price equal to the Fair Market Value of a share of Common Stock determined as of the date such right is exercised, provided that if such termination of the Management Stockholder’s Employment occurs due to the Management Stockholder’s death or Disability or is effected by the Company without Cause or by the Management Stockholder for Good Reason, the call right described in this paragraph (i) shall not apply with respect to such Management Stockholder’s Rollover Shares.
(ii) In the event that either the Management Stockholder’s Employment with the Company is terminated for Cause or the Management Stockholder violates any of the restrictive covenants set forth in the Plan or in any equity award grant agreement under the Plan:
(A) in either case prior to the Agreement Termination Date, the Company (or its designated assignee) shall have the right, during the 180-day period following the latest to occur of (x) such termination of Employment, (y) such violation of a restrictive covenant and (z) the date on which the Management Stockholder or Transferee has held the Shares most recently acquired to be sold pursuant to this Section 3(b)(ii) for at least six (6) months, to purchase from the Management Stockholder or the Management Stockholder’s Transferee, and upon the exercise of such right the Management Stockholder or such Transferee shall sell to the Company (or its designated assignee), all or any portion of the Shares held by the Management Stockholder or Transferee as of the date as of which such right is exercised at a per Share price equal to (I) in the case of a Rollover Share, the Fair Market Value of such Share determined as of the date such right is exercised or (II) in the case of an Option Share, the lesser of (a) the Fair Market Value of a share of Common Stock determined as of the date such right is exercised or (b) the exercise price per Share paid by the Management Stockholder to acquire such Share; or
(B) in either case following the Agreement Termination Date, the Management Stockholder shall be obligated to pay to the Company an amount equal to the amount which, as a result of such Management Stockholder’s exercise of Options at any time following, or within one year prior to, the date of termination of his or her Employment, such Management Stockholder was required to recognize as income for U.S. federal income tax purposes (or would have been required to recognize as income if the Management Stockholder was subject to U.S. federal income taxes).
(iii) In the event that the Management Stockholder resigns from Employment with the Company without Good Reason prior to the fifth anniversary of the Effective Time, the Company (or its designated assignee) shall have the right, during the 180-day period following the later to occur of (A) such termination of Employment and (B) the date on which the Management Stockholder or Transferee has held the Shares most recently acquired to be sold pursuant to this Section 3(b)(iii) for at least six (6) months, to purchase from the Management Stockholder or the Management Stockholder’s Transferee, and upon the exercise of such right the Management Stockholder or such Transferee shall sell to the Company (or its designated assignee), all or any portion of the Shares held by the Management Stockholder or Transferee as of the date as of which such right is exercised at a per Share price equal to (I) in the case of a Rollover Share, the Fair Market Value of a share of Common Stock determined as of the date such right is exercised or (II) in the case of an Option Share, an amount equal to (a) the Fair Market Value of a share of Common Stock determined as of the date such right is exercised less (b) the amount equal to 20% of the amount (if any) by which the Fair Market Value of a share of Common Stock determined as of the date such right is exercised exceeds the Exercise Price per share of Common Stock (as defined under the Plan or any successor plan).
(iv) The Company (or its designated assignee) shall exercise the call rights described in this Section 3(b) by delivering to the Management Stockholder or Transferee, as applicable, a written notice specifying its intent to purchase Shares held by the Management Stockholder or Transferee (the “Call Notice”) and the number of Shares to be purchased. The Company’s call right shall be deemed exercised as of the date on which the Company delivers such Call Notice to the Management Stockholder or Transferee. Such purchase and sale shall occur on such date as the Company (or its designated assignee) shall specify, which date shall be no later than forty-five (45) days after the end of the fiscal quarter (A) in which the Call Notice is delivereddelivered or (B) if the Management Stockholder or Transferee seeks an Outside Appraisal, in which the Outside Appraisal is completed. The Company will use commercially reasonable efforts to make the payment for the Shares in cash on the date of such purchase and sale; provided that, despite using such efforts, if such payment will result in the violation of the terms or provisions of, or result in a default or event of default under, any guarantee, financing or security agreement or document entered into by the Company or any of its Affiliates and in effect on such date (hereinafter a “Financing Agreement”), the Company may delay any such payment for no more than two (2) years. In the event the payment of the purchase price is delayed as a result of a restriction imposed by a Financing Agreement as provided above, such payment shall be made without the application of further conditions or impediments as soon as practicable after the payment of such purchase price would no longer result in the violation of the terms or provisions of, or result in a default or event of default under, any Financing Agreement, and such payment shall equal the amount that would have been paid to the Management Stockholder or Transferee if no delay had occurred plus interest for the period from the date on which the purchase price would have been paid but for the delay in payment provided herein to the date on which such payment is made (the “Delay Period”), calculated at an annual rate equal to the average annual prime rate charged during the Delay Period by a nationally recognized bank designated by the Board plus two (2) percentage points. In the event that the Company is not able to make payment within two (2) years after the date specified in the Call Notice, the Company will, upon the written request of the Management Stockholder or Transferee, cancel the Call Notice and return to the Management Stockholder or Transferee the Shares subject to the Call Notice (as adjusted to take into account any corporate transactions during the intervening period) in exchange for cancellation of the debt and any interest payments that would otherwise have been payable thereon.
(v) In the event that the Company exercises its call right to purchase Shares from the Management Stockholder under Section 3(b)(i) or Section 3(b)(iii) and, following the date that the Company pays the Management Stockholder the applicable purchase price for such Shares, the Management Stockholder violates any of the restrictive covenants set forth in the Plan or in any equity award grant agreement under the Plan, the Management Stockholder or the Management Stockholder’s Transferee shall pay to the Company, within ten (10) business days following the date of such violation, an amount equal to (A) the amount the Company paid the Management Stockholder or Transferee to purchase such Shares less (B) the amount the Company would have been required to pay the Management Stockholder or Transferee for such Shares if the Company had purchased the Shares pursuant to Section 3(b)(ii)(A).
(vi) In the event that the Management Stockholder or Transferee (as applicable) disagrees with the Company’s determination of the Fair Market Value of a Share, the Management Stockholder or Transferee shall have the right to require the Company to seek an appraisal to determine the Fair Market Value of a Share in lieu of the Board determination (an “Outside Appraisal”); provided that the Transferee shall not be entitled to an Outside Appraisal in the event that a third party valuation to determine the Fair Market Value of a Share has been done within the nine-month period immediately preceding delivery of the Call Notice and the Board determines in good faith that no event has occurred that would result in the prior determination of Fair Market Value being materially inaccurate. Any such Outside Appraisal shall be made by one qualified person (which can be an accounting firm or investment banking firm or similar firm) (an “Appraiser”), having substantial experience in the valuation of similar enterprises in the United States. The Company and the Management Stockholder or Transferee shall mutually agree upon such Appraiser within 30 days of the date of delivery of the Call Notice. The Company shall bear 100% of the fees and expenses of the Appraiser; provided, however, that the Management Stockholder or Transferee that sought the Outside Appraisal shall immediately reimburse the Company for 100% of the cost of the Outside Appraisal if the Fair Market Value of a Share determined by the Appraiser is less than or equal to the amount equal to 110% of the Fair Market Value of a Share determined by the Board.
Appears in 3 contracts
Samples: Management Stockholders’ Agreement (LVB Acquisition, Inc.), Management Stockholders’ Agreement (LVB Acquisition, Inc.), Management Stockholders’ Agreement (Biomet Inc)
Call Rights. (a) The Company may, in its sole discretion, elect to purchase up to all of the Vested Equity Plan Units of each Equity Plan Member under the following circumstances:
(i) Except within twelve (12) months (or such shorter period if required by applicable law) of the date an Equity Plan Member ceases to be an employee, consultant or representative of the Company, as provided in paragraphs applicable;
(ii) and in the event of a Sale Transaction;
(iii) in the event of the Bankruptcy of such Equity Plan Member; and
(iv) as permitted by and in accordance with the terms and conditions of the applicable Award Agreement or employment agreement.
(b) If the Company elects to exercise its right to purchase such Equity Plan Units in accordance with this Article XII, it shall provide written notice thereof to the Equity Plan Members, which notice shall include the number of Equity Plan Units to be purchased (the “Equity Plan Call Units”) and the basis on which the Company is exercising its call rights under Section 3(b12.1(a).
(c) The fair market value of each Equity Plan Call Unit (such price, the “Equity Plan Call Unit Price”) shall be determined by an appraisal process between the Company and the applicable Equity Plan Member, which process shall include deductions for any outstanding debt or other liabilities of the Company (including accrued but unpaid interest at the Applicable Interest Rate) and each Class A Member’s right to the return of its Capital Contributions under Section 9.3(a) (it being understood that the deduction of debt and/or the right to receive back contributed capital may result in the Equity Plan Units or the Interactive One Equity Plan Units having a negative value that will be taken into consideration in determining the net value of the Equity Plan Units and Interactive One Equity Plan Units subject to the same Combined Award Agreement); provided, however, in the event that the Management Stockholderbasis for the Company’s Employment with the Company terminates for any reason prior to the Agreement Termination Date (as hereinafter defined), the Company (or exercise of its designated assignee) shall have the right, during the 180-day period following the later to occur of (A) such termination of Employment and (B) the date on which the Management Stockholder or Transferee has held the Shares most recently acquired to be sold pursuant to rights under this Section 3(b)(i) for at least six (6) months, to purchase from the Management Stockholder or the Management Stockholder’s Transferee, and upon the exercise of such right the Management Stockholder or such Transferee shall sell to the Company (or its designated assignee), all or any portion of the Shares held by the Management Stockholder or Transferee as of the date as of which such right 12.1 is exercised at a per Share price equal to the Fair Market Value of a share of Common Stock determined as of the date such right is exercised, provided that if such termination of the Management Stockholder’s Employment occurs due to the Management Stockholder’s death or Disability or is effected by the Company without Cause or by the Management Stockholder for Good Reason, the call right described in this paragraph (i) shall not apply with respect to such Management Stockholder’s Rollover Shares.
(ii) In the event that either the Management Stockholder’s Employment with the Company is terminated for Cause or the Management Stockholder violates any of the restrictive covenants set forth in the Plan or in any equity award grant agreement under the Plan:
(A) in either case prior to the Agreement Termination Date, the Company (or its designated assignee) shall have the right, during the 180-day period following the latest to occur of (x) such termination of Employment, (y) such violation of a restrictive covenant and (z) the date on which the Management Stockholder or Transferee has held the Shares most recently acquired to be sold pursuant to this Section 3(b)(ii) for at least six (6) months, to purchase from the Management Stockholder or the Management Stockholder’s Transferee, and upon the exercise of such right the Management Stockholder or such Transferee shall sell to the Company (or its designated assignee), all or any portion of the Shares held by the Management Stockholder or Transferee as of the date as of which such right is exercised at a per Share price equal to (I) in the case of a Rollover Share, the Fair Market Value of such Share determined as of the date such right is exercised or (II) in the case of an Option Share, the lesser of (a) the Fair Market Value of a share of Common Stock determined as of the date such right is exercised or (b) the exercise price per Share paid by the Management Stockholder to acquire such Share; or
(B) in either case following the Agreement Termination Date, the Management Stockholder shall be obligated to pay to the Company an amount equal to the amount which, as a result of such Management Stockholder’s exercise the termination of Options at any time followingan Equity Plan Member for Cause, or within one year prior tothe Board has determined that such Member has violated any non-solicitation, the date of termination of his non-competition or her Employment, such Management Stockholder was required to recognize as income for U.S. federal income tax purposes (or would have been required to recognize as income if the Management Stockholder was subject to U.S. federal income taxes).
(iii) In the event that the Management Stockholder resigns from Employment with the Company without Good Reason prior to the fifth anniversary of the Effective Time, the Company (or its designated assignee) shall have the right, during the 180non-day period following the later to occur of (A) such termination of Employment and (B) the date on which the Management Stockholder or Transferee has held the Shares most recently acquired to be sold pursuant to this Section 3(b)(iii) for at least six (6) months, to purchase from the Management Stockholder or the Management Stockholder’s Transferee, and upon the exercise of such right the Management Stockholder or such Transferee shall sell to the Company (or its designated assignee), all or disclosure provision contained in any portion of the Shares held by the Management Stockholder or Transferee as of the date as of which such right is exercised at a per Share price equal to (I) in the case of a Rollover Share, the Fair Market Value of a share of Common Stock determined as of the date such right is exercised or (II) in the case of an Option Share, an amount equal to (a) the Fair Market Value of a share of Common Stock determined as of the date such right is exercised less (b) the amount equal to 20% of the amount (if any) by which the Fair Market Value of a share of Common Stock determined as of the date such right is exercised exceeds the Exercise Price per share of Common Stock (as defined under the Plan or any successor plan).
(iv) The Company (or its designated assignee) shall exercise the call rights described in this Section 3(b) by delivering to the Management Stockholder or Transferee, as applicable, a written notice specifying its intent to purchase Shares held by the Management Stockholder or Transferee (the “Call Notice”) and the number of Shares to be purchased. The Company’s call right shall be deemed exercised as of the date on which the Company delivers such Call Notice to the Management Stockholder or Transferee. Such purchase and sale shall occur on such date as the Company (or its designated assignee) shall specify, which date shall be no later than forty-five (45) days after the end of the fiscal quarter in which the Call Notice is delivered. The Company will use commercially reasonable efforts to make the payment for the Shares in cash on the date of such purchase and sale; provided that, despite using such efforts, if such payment will result in the violation of the terms or provisions of, or result in a default or event of default under, any guarantee, financing or security agreement or document entered into by and between such Member and the Company or any of its Affiliates and in effect on such date (hereinafter a “Financing Agreement”)Company, the Company may delay any fair market value of such payment for no more than two (2) yearsMember’s Equity Plan Units shall be the lesser of such Member’s Capital Account balance attributed to such Units or the value determined in accordance with the procedures described above. In If the event the payment value of the purchase price Equity Plan Units is delayed as a result of a restriction imposed by a Financing Agreement as provided above, such payment shall be made without positive and the application of further conditions or impediments as soon as practicable after the payment of such purchase price would no longer result in the violation value of the terms or provisions ofInteractive One Equity Plan Units is negative, or result in a default or event of default under, any Financing Agreement, and such payment shall equal the amount that would Equity Plan Units will only have been paid to the Management Stockholder or Transferee if no delay had occurred plus interest for the period from the date on which the purchase price would have been paid but for the delay in payment provided herein to the date on which such payment is made (the “Delay Period”), calculated at an annual rate value equal to the average annual prime rate charged during sum of such positive and negative amounts (i.e., the Delay Period by a nationally recognized bank designated positive amount of the value of the Equity Plan Units will be offset by the Board plus two (2) percentage pointsnegative amount of the value of the Interactive One Equity Plan Units that have a negative value). In the event that the Equity Plan Member and the Company is cannot able reach an agreement as to make payment the Equity Plan Call Unit Price within two thirty (230) years after days of the date specified in of the Call Noticenotice delivered pursuant to Section 12.1(b), the parties agree to submit such determination to binding arbitration in New York, New York, before one (1) arbitrator. The arbitration shall be administered by the American Arbitration Association pursuant to the AAA Rules and Procedures. For purposes of determining the Equity Plan Call Unit Price, the valuation of the Company willshall first be determined as an entirety before determining the value of the Equity Plan Units held by the applicable Equity Plan Member, based on the amount that such Equity Plan Member would receive from the proceeds of the sale of the Company at such valuation upon the written request liquidation of the Management Stockholder or Transferee, cancel the Call Notice and return to the Management Stockholder or Transferee the Shares subject to the Call Notice (as adjusted to take into account any corporate transactions during the intervening period) in exchange for cancellation of the debt and any interest payments that would otherwise have been payable thereon.
(v) In the event that the Company exercises its call right to purchase Shares from the Management Stockholder under Section 3(b)(i) or Section 3(b)(iii) and, following the date that the Company pays the Management Stockholder the applicable purchase price for such Shares, the Management Stockholder violates any of the restrictive covenants set forth in the Plan or in any equity award grant agreement under the Plan, the Management Stockholder or the Management Stockholder’s Transferee shall pay to the Company, within ten (10) business days following and the date interest of such violation, an amount equal the Equity Plan Member shall not be subject to (A) the amount the Company paid the Management Stockholder a discount for minority interest or Transferee to purchase such Shares less (B) the amount the Company would have been required to pay the Management Stockholder or Transferee for such Shares if the Company had purchased the Shares pursuant to Section 3(b)(ii)(A)lack of liquidity.
Appears in 1 contract
Samples: Limited Liability Company Operating Agreement (Radio One Distribution Holdings, LLC)
Call Rights. (a) The Company may, in its sole discretion, elect to purchase up to all of the Vested Equity Plan Units of each Equity Plan Member under the following circumstances:
(i) Except within twelve (12) months (or such shorter period if required by applicable law) of the date an Equity Plan Member ceases to be an employee, consultant or representative of the Company, as provided in paragraphs applicable;
(ii) and in the event of a Sale Transaction;
(iii) in the event of the Bankruptcy of such Equity Plan Member; and
(iv) as permitted by and in accordance with the terms and conditions of the applicable Award Agreement or employment agreement.
(b) If the Company elects to exercise its right to purchase such Equity Plan Units in accordance with this Article XII, it shall provide written notice thereof to the Equity Plan Members, which notice shall include the number of Equity Plan Units to be purchased (the “Equity Plan Call Units”) and the basis on which the Company is exercising its call rights under Section 3(b12.1(a).
(c) The fair market value of each Equity Plan Call Unit (such price, the “Equity Plan Call Unit Price”) shall be determined by an appraisal process between the Company and the applicable Equity Plan Member, which process shall include deductions for any outstanding debt or other liabilities of the Company (including accrued but unpaid interest at the Applicable Interest Rate) and each Class A Member’s right to the return of its Capital Contributions under Section 9.3(a) (it being understood that the deduction of debt and/or the right to receive back contributed capital may result in the Equity Plan Units or the Community Connect Equity Plan Units having a negative value that will be taken into consideration in determining the net value of the Equity Plan Units and Community Connect Equity Plan Units subject to the same Combined Award Agreement); provided, however, in the event that the Management Stockholderbasis for the Company’s Employment with the Company terminates for any reason prior to the Agreement Termination Date (as hereinafter defined), the Company (or exercise of its designated assignee) shall have the right, during the 180-day period following the later to occur of (A) such termination of Employment and (B) the date on which the Management Stockholder or Transferee has held the Shares most recently acquired to be sold pursuant to rights under this Section 3(b)(i) for at least six (6) months, to purchase from the Management Stockholder or the Management Stockholder’s Transferee, and upon the exercise of such right the Management Stockholder or such Transferee shall sell to the Company (or its designated assignee), all or any portion of the Shares held by the Management Stockholder or Transferee as of the date as of which such right 12.1 is exercised at a per Share price equal to the Fair Market Value of a share of Common Stock determined as of the date such right is exercised, provided that if such termination of the Management Stockholder’s Employment occurs due to the Management Stockholder’s death or Disability or is effected by the Company without Cause or by the Management Stockholder for Good Reason, the call right described in this paragraph (i) shall not apply with respect to such Management Stockholder’s Rollover Shares.
(ii) In the event that either the Management Stockholder’s Employment with the Company is terminated for Cause or the Management Stockholder violates any of the restrictive covenants set forth in the Plan or in any equity award grant agreement under the Plan:
(A) in either case prior to the Agreement Termination Date, the Company (or its designated assignee) shall have the right, during the 180-day period following the latest to occur of (x) such termination of Employment, (y) such violation of a restrictive covenant and (z) the date on which the Management Stockholder or Transferee has held the Shares most recently acquired to be sold pursuant to this Section 3(b)(ii) for at least six (6) months, to purchase from the Management Stockholder or the Management Stockholder’s Transferee, and upon the exercise of such right the Management Stockholder or such Transferee shall sell to the Company (or its designated assignee), all or any portion of the Shares held by the Management Stockholder or Transferee as of the date as of which such right is exercised at a per Share price equal to (I) in the case of a Rollover Share, the Fair Market Value of such Share determined as of the date such right is exercised or (II) in the case of an Option Share, the lesser of (a) the Fair Market Value of a share of Common Stock determined as of the date such right is exercised or (b) the exercise price per Share paid by the Management Stockholder to acquire such Share; or
(B) in either case following the Agreement Termination Date, the Management Stockholder shall be obligated to pay to the Company an amount equal to the amount which, as a result of such Management Stockholder’s exercise the termination of Options at any time followingan Equity Plan Member for Cause, or within one year prior tothe Board has determined that such Member has violated any non- solicitation, the date of termination of his non-competition or her Employment, such Management Stockholder was required to recognize as income for U.S. federal income tax purposes (or would have been required to recognize as income if the Management Stockholder was subject to U.S. federal income taxes).
(iii) In the event that the Management Stockholder resigns from Employment with the Company without Good Reason prior to the fifth anniversary of the Effective Time, the Company (or its designated assignee) shall have the right, during the 180non-day period following the later to occur of (A) such termination of Employment and (B) the date on which the Management Stockholder or Transferee has held the Shares most recently acquired to be sold pursuant to this Section 3(b)(iii) for at least six (6) months, to purchase from the Management Stockholder or the Management Stockholder’s Transferee, and upon the exercise of such right the Management Stockholder or such Transferee shall sell to the Company (or its designated assignee), all or disclosure provision contained in any portion of the Shares held by the Management Stockholder or Transferee as of the date as of which such right is exercised at a per Share price equal to (I) in the case of a Rollover Share, the Fair Market Value of a share of Common Stock determined as of the date such right is exercised or (II) in the case of an Option Share, an amount equal to (a) the Fair Market Value of a share of Common Stock determined as of the date such right is exercised less (b) the amount equal to 20% of the amount (if any) by which the Fair Market Value of a share of Common Stock determined as of the date such right is exercised exceeds the Exercise Price per share of Common Stock (as defined under the Plan or any successor plan).
(iv) The Company (or its designated assignee) shall exercise the call rights described in this Section 3(b) by delivering to the Management Stockholder or Transferee, as applicable, a written notice specifying its intent to purchase Shares held by the Management Stockholder or Transferee (the “Call Notice”) and the number of Shares to be purchased. The Company’s call right shall be deemed exercised as of the date on which the Company delivers such Call Notice to the Management Stockholder or Transferee. Such purchase and sale shall occur on such date as the Company (or its designated assignee) shall specify, which date shall be no later than forty-five (45) days after the end of the fiscal quarter in which the Call Notice is delivered. The Company will use commercially reasonable efforts to make the payment for the Shares in cash on the date of such purchase and sale; provided that, despite using such efforts, if such payment will result in the violation of the terms or provisions of, or result in a default or event of default under, any guarantee, financing or security agreement or document entered into by and between such Member and the Company or any of its Affiliates and in effect on such date (hereinafter a “Financing Agreement”)Company, the Company may delay any fair market value of such payment for no more than two (2) yearsMember’s Equity Plan Units shall be the lesser of such Member’s Capital Account balance attributed to such Units or the value determined in accordance with the procedures described above. In If the event the payment value of the purchase price Equity Plan Units is delayed as a result of a restriction imposed by a Financing Agreement as provided above, such payment shall be made without positive and the application of further conditions or impediments as soon as practicable after the payment of such purchase price would no longer result in the violation value of the terms or provisions ofCommunity Connect Equity Plan Units is negative, or result in a default or event of default under, any Financing Agreement, and such payment shall equal the amount that would Equity Plan Units will only have been paid to the Management Stockholder or Transferee if no delay had occurred plus interest for the period from the date on which the purchase price would have been paid but for the delay in payment provided herein to the date on which such payment is made (the “Delay Period”), calculated at an annual rate value equal to the average annual prime rate charged during sum of such positive and negative amounts (i.e., the Delay Period by a nationally recognized bank designated positive amount of the value of the Equity Plan Units will be offset by the Board plus two (2) percentage pointsnegative amount of the value of the Community Connect Equity Plan Units that have a negative value). In the event that the Equity Plan Member and the Company is cannot able reach an agreement as to make payment the Equity Plan Call Unit Price within two thirty (230) years after days of the date specified in of the Call Noticenotice delivered pursuant to Section 12.1(b), the parties agree to submit such determination to binding arbitration in New York, New York, before one (1) arbitrator. The arbitration shall be administered by the American Arbitration Association pursuant to the AAA Rules and Procedures. For purposes of determining the Equity Plan Call Unit Price, the valuation of the Company willshall first be determined as an entirety before determining the value of the Equity Plan Units held by the applicable Equity Plan Member, based on the amount that such Equity Plan Member would receive from the proceeds of the sale of the Company at such valuation upon the written request liquidation of the Management Stockholder or Transferee, cancel the Call Notice and return to the Management Stockholder or Transferee the Shares subject to the Call Notice (as adjusted to take into account any corporate transactions during the intervening period) in exchange for cancellation of the debt and any interest payments that would otherwise have been payable thereon.
(v) In the event that the Company exercises its call right to purchase Shares from the Management Stockholder under Section 3(b)(i) or Section 3(b)(iii) and, following the date that the Company pays the Management Stockholder the applicable purchase price for such Shares, the Management Stockholder violates any of the restrictive covenants set forth in the Plan or in any equity award grant agreement under the Plan, the Management Stockholder or the Management Stockholder’s Transferee shall pay to the Company, within ten (10) business days following and the date interest of such violation, an amount equal the Equity Plan Member shall not be subject to (A) the amount the Company paid the Management Stockholder a discount for minority interest or Transferee to purchase such Shares less (B) the amount the Company would have been required to pay the Management Stockholder or Transferee for such Shares if the Company had purchased the Shares pursuant to Section 3(b)(ii)(A)lack of liquidity.
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Samples: Limited Liability Company Operating Agreement (Radio One Distribution Holdings, LLC)