Composition of the Board. At and following the date hereof, PubCo shall take all Necessary Action to cause the Board to be comprised of up to ten (10) directors (subject to Section 2.3), selected as set forth herein. As of and, except as otherwise indicated below, following the date hereof, the Board shall include: (i) up to two (2) directors designated to PubCo by the ABRY Entities (such directors and any of their respective successors designated pursuant to subsection 2.1.3, each, a “Pre- Closing Holder Director”); provided, that if the ABRY Entities and their respective Affiliates cease to own shares of Common Stock of PubCo representing greater than 5% of the total shares of Common Stock of PubCo then-outstanding, then the ABRY Entities shall not have the right to designate any directors to the Board and PubCo shall have no further obligations under this subsection 2.1.1(i); (ii) up to two (2) directors designated to PubCo by the Sponsor (such directors and any of their respective successors designated pursuant to subsection 2.1.5, each, a “Sponsor Director”); provided, that if Sponsor and its Affiliates cease to own shares of Common Stock of PubCo representing greater than 5% of the total shares of Common Stock of PubCo then-outstanding, then the Sponsor shall not have the right to designate any directors to the Board and PubCo shall have no further obligations under this subsection 2.1.1(ii); (iii) up to two (2) directors designated to PubCo by Searchlight (such directors, and any of their respective successors designated pursuant to subsection 2.1.4, each, a “Searchlight Director”); provided, that if Searchlight and its Affiliates cease to own at least 7,866,666 shares of Common Stock (including, for this purpose, shares underlying warrants to purchase shares of Common Stock) of PubCo in the aggregate (as proportionately adjusted for stock splits, stock dividends, combinations or reclassifications or the like) (such time, the “Fall-Away of Purchaser Board Rights”), then Searchlight shall not have the right to designate any directors to the Board and PubCo shall have no further obligations under this subsection 2.1.1(iii); (iv) the chief executive officer of PubCo, whom shall initially be Xxxxx Xxxx; (v) up to three (3) Independent Directors by recommendation of the NCG Committee, so long as, in each case, such person has been approved by the Board, which shall initially be as the date hereof, Xxxxxxx Xxxxxxx, X. Xxxxxxx Xxxxxxxx and Xxxxxxx Xx-Xxxx (each, a “Named Director”); and (vi) in the event of a reduction to the number of directors that a Principal Holder is entitled to designate pursuant to subsections (i), (ii) or (iii) above (such number, in the aggregate as among all Principal Holders, the “Amount”), up to such number of Independent Directors equal to the Amount (subject to Section 2.3) by recommendation of the NCG Committee, so long as, in each case, each such individual has been approved by the Board. As of the date hereof, the foregoing directors are to be divided into three (3) classes of directors, with each class serving for staggered three (3)-year terms commencing as of the Effective Date as follows: (a) The Class I directors shall include: (x) two (2) Independent Directors nominated by the NCG Committee and approved by the Board (selected for Class I by the NCG Committee) (y) subject to subsection (vi) of subsection 2.1.1, one (1) Searchlight Director designated by Searchlight (selected for Class I by Searchlight) and (z) subject to subsection (vi) of subsection 2.1.1, one (1) Sponsor Director designated by the Sponsor (selected for Class I by the Sponsor); (b) The Class II directors shall include: (x) subject to subsection (vi) of subsection 2.1.1, one (1) Searchlight Director designated by Searchlight (selected for Class II by Searchlight), (y) subject to subsection (vi) of subsection 2.1.1, one (1) Sponsor Director designated by the Sponsor (selected for Class II by the Sponsor) and (z) one (1) Independent Director nominated by the NCG Committee and approved by the Board (selected for Class II by the NCG Committee); and (c) The Class III directors shall include: (x) the CEO of PubCo and (y) subject to subsection (vi) of subsection 2.1.1 two (2) Pre-Closing Holder Directors designated by the ABRY Entities (selected for Class III by the ABRY Entities). The current term of the Class I directors shall expire immediately following PubCo’s 2025 annual meeting of stockholders at which directors are elected. The current term of the Class II directors shall expire immediately following PubCo’s 2026 annual meeting of stockholders at which directors are elected. The current term of the Class III directors shall expire immediately following PubCo’s 2024 annual meeting at which directors are elected. For the avoidance of doubt, the designation of a director in accordance with the foregoing shall be in the sole discretion of the Sponsor, Searchlight and the ABRY Entities, as applicable, and, if the Sponsor, Searchlight or the ABRY Entities, as applicable, elect not to so designate a director in accordance with the foregoing, such seats shall remain vacant until filled in accordance herewith.
Appears in 2 contracts
Samples: Investor Rights Agreement (KORE Group Holdings, Inc.), Investment Agreement (KORE Group Holdings, Inc.)
Composition of the Board. At and following the date hereof, PubCo shall take all Necessary Action to cause the Board to be comprised of up to ten (10) directors (subject to Section 2.3), selected as set forth herein. As of and, except as otherwise indicated below, following the date hereof, the Board shall include:
(i) up to two (2) directors designated to PubCo by the ABRY Entities (such directors and any of their respective successors designated pursuant to subsection 2.1.3, each, a “Pre- Closing Holder Director”); provided, that if the ABRY Entities and their respective Affiliates cease to own shares of Common Stock of PubCo representing greater than 5% of the total shares of Common Stock of PubCo then-outstanding, then the ABRY Entities shall not have the right to designate any directors to the Board and PubCo shall have no further obligations under this subsection 2.1.1(i);
(ii) up to two (2) directors designated to PubCo by the Sponsor (such directors and any of their respective successors designated pursuant to subsection 2.1.5, each, a “Sponsor Director”); provided, that if Sponsor and its Affiliates cease to own shares of Common Stock of PubCo representing greater than 5% of the total shares of Common Stock of PubCo then-outstanding, then the Sponsor shall not have the right to designate any directors to the Board and PubCo shall have no further obligations under this subsection 2.1.1(ii);
(iii) up to two (2) directors designated to PubCo by Searchlight (such directors, and any of their respective successors designated pursuant to subsection 2.1.4, each, a “Searchlight Director”); provided, that if Searchlight and its Affiliates cease to own at least 7,866,666 shares of Common Stock (including, for this purpose, shares underlying warrants to purchase shares of Common Stock) of PubCo in the aggregate (as proportionately adjusted for stock splits, stock dividends, combinations or reclassifications or the like) (such time, the “Fall-Away of Purchaser Board Rights”), then Searchlight shall not have the right to designate any directors to the Board and PubCo shall have no further obligations under this subsection 2.1.1(iii);
(iv) the chief executive officer of PubCo, whom shall initially be Xxxxx Xxxx;
(v) up to three (3) Independent Directors by recommendation of the NCG Committee, so long as, in each case, such person has been approved by the Board, which shall initially be as the date hereof, Xxxxxxx Xxxxxxx, X. Xxxxxxx Xxxxxxxx and Xxxxxxx Xx-Xxxx (each, a “Named Director”); and
(vi) in the event of a reduction to the number of directors that a Principal Holder is entitled to designate pursuant to subsections (i), (ii) or (iii) above (such number, in the aggregate as among all Principal Holders, the “Amount”), up to such number of Independent Directors equal to the Amount (subject to Section 2.3) by recommendation of the NCG Committee, so long as, in each case, each such individual has been approved by the Board. As of the date hereof, the foregoing directors are to be divided into three (3) classes of directors, with each class serving for staggered three (3)-year terms commencing as of the Effective Date as follows:
(a) The Class I directors Board shall include: consist of up to fourteen (x14) two Directors, consisting of (2i) Independent eight (8) Directors nominated by the NCG Committee and approved by the Board (selected for Class I by the NCG Committee) (y) subject to subsection (vi) of subsection 2.1.1, one (1) Searchlight Director designated by Searchlight (selected for Class I by Searchlight) and (z) subject to subsection (vi) of subsection 2.1.1, one (1) Sponsor Director designated by the Sponsor Founder Holding Company (selected for Class I by the Sponsor“Founder Directors”);, and (ii) six (6) Directors designated in accordance with Section 2.01(b) (the “Investor Directors”). The Founder shall be entitled to designate one of the Founder Directors as the Chairman of the Board.
(b) The Class II directors Investor Directors shall include: consist of (x) subject to subsection (vi) of subsection 2.1.1, one (1) Searchlight Director designated by Searchlight (selected for Class II by Searchlight), (y) subject to subsection (vi) of subsection 2.1.1, one (1) Sponsor Director designated by the Sponsor (selected for Class II by the Sponsor) and (zi) one (1) Independent Director nominated designated by SVF (the NCG Committee and approved by the Board (selected for Class II by the NCG Committee“SVF Director”); andprovided that SVF shall cease to have such designation right if the number of Shares held by SVF is less than fifty percent (50%) of the number of Shares held by SVF immediately after the Closing, (ii) one (1) Director designated by Tencent (the “Tencent Director”); provided that Tencent shall cease to have such designation right if the number of Shares held by Tencent is less than fifty percent (50%) of the number of Shares held by Tencent immediately after the Closing, (iii) one (1) Director designated by Sunac; provided that Sunac shall cease to have such designation right if the number of Shares held by Sunac is less than fifty percent (50%) of the number of Shares held by Sunac immediately after the Closing; (iv) one (1) Director designated by Vanke; provided that Vanke shall cease to have such designation right if the number of Shares held by Vanke is less than fifty percent (50%) of the number of Shares held by Vanke immediately after the Closing; (v) one (1) Director designated by Xxxxxxxxx; provided that Xxxxxxxxx shall cease to have such designation right if the number of Shares held by Xxxxxxxxx is less than fifty percent (50%) of the number of Shares held by Xxxxxxxxx immediately after the Closing; and (vi) one (1) Director designated by Huaxing; provided that Huaxing shall cease to have such designation right if the number of Shares held by Huaxing is less than fifty percent (50%) of the number of Shares held by Huaxing immediately after the Closing.
(c) The Class III directors shall include: (x) Each Shareholder agrees that, if at any time it is then entitled to vote for the CEO of PubCo and (y) subject to subsection (vi) of subsection 2.1.1 two (2) Pre-Closing Holder Directors designated by the ABRY Entities (selected for Class III by the ABRY Entities). The current term appointment of the Class I directors Directors, it shall expire immediately following PubCo’s 2025 annual vote all of its Company Securities or execute proxies or written resolutions or consents, as the case may be, and take all other necessary actions (including causing the Company to call an extraordinary general meeting of stockholders at which directors are elected. The current term shareholders) in order to ensure that the composition of the Class II directors Board is as set forth in this Section 2.01.
(d) Each Director may appoint an Alternate Director from time to time to act during his absence, and such Alternate Director shall expire immediately following PubCo’s 2026 annual meeting be entitled, while holding such office, to receive notices of stockholders at which directors are elected. The current term meetings of the Class III directors shall expire immediately following PubCo’s 2024 annual Board or any committee thereof (if the Director who has appointed the Alternate Director is a member of such committee), and attend and vote as a Director at any such meeting at which directors are elected. For the avoidance appointing Director is not present and generally to exercise all the powers, rights, duties and authorities and to perform all functions of doubtthe appointing Director.
(e) To the extent permitted by Applicable Law, in the designation event that (i) a compensation committee of a director in accordance with the foregoing Board is established by the Board and (ii) the SVF Director serves on the Board at any time following the establishment of the compensation committee, SVF shall be entitled to designate the SVF Director to that compensation committee; provided, that nothing in this Section 2.01(e) shall obligate the sole discretion Board to establish a compensation committee.
(f) Notwithstanding anything to the contrary in this Agreement, any right to designate any Director or any Board Observer is individual to the applicable Shareholder and shall not be capable of the Sponsorbeing transferred or assigned to any Person other than its Permitted Transferee, Searchlight and the ABRY Entities, as applicable, and, if the Sponsor, Searchlight whether in conjunction with a Transfer of Company Securities or the ABRY Entities, as applicable, elect not to so designate a director in accordance with the foregoing, such seats shall remain vacant until filled in accordance herewithotherwise.
Appears in 2 contracts
Samples: Investor Rights Agreement (KE Holdings Inc.), Investor Rights Agreement (KE Holdings Inc.)
Composition of the Board. At and following the date hereof, PubCo (a) The Board shall take all Necessary Action to cause the Board to be comprised consist of up to ten seven (107) directors (subject to Section 2.3)Directors, selected as set forth herein. As consisting of and, except as otherwise indicated below, following the date hereof, the Board shall include:
(i) up to two five (25) directors Directors jointly designated to PubCo by the ABRY Entities Founder Holding Companies (such directors and any of their respective successors designated pursuant to subsection 2.1.3, each, a “Pre- Closing Holder Director”); provided, that if the ABRY Entities and their respective Affiliates cease to own shares of Common Stock of PubCo representing greater than 5% of the total shares of Common Stock of PubCo then-outstanding, then the ABRY Entities shall not have the right to designate any directors to the Board and PubCo shall have no further obligations under this subsection 2.1.1(i);
(ii) up to two (2) directors designated to PubCo by the Sponsor (such directors and any of their respective successors designated pursuant to subsection 2.1.5, each, a “Sponsor Director”); provided, that if Sponsor and its Affiliates cease to own shares of Common Stock of PubCo representing greater than 5% of the total shares of Common Stock of PubCo then-outstanding, then the Sponsor shall not have the right to designate any directors to the Board and PubCo shall have no further obligations under this subsection 2.1.1(ii);
(iii) up to two (2) directors designated to PubCo by Searchlight (such directors, and any of their respective successors designated pursuant to subsection 2.1.4, each, a “Searchlight Director”); provided, that if Searchlight and its Affiliates cease to own at least 7,866,666 shares of Common Stock (including, for this purpose, shares underlying warrants to purchase shares of Common Stock) of PubCo in the aggregate (as proportionately adjusted for stock splits, stock dividends, combinations or reclassifications or the like) (such time, the “Fall-Away of Purchaser Board RightsFounder Directors”), then Searchlight shall not have the right to designate any directors to the Board and PubCo shall have no further obligations under this subsection 2.1.1(iii);
(iv) the chief executive officer of PubCo, whom shall initially be Xxxxx Xxxx;
(v) up to three (3) Independent Directors by recommendation of the NCG Committee, so long as, in each case, such person has been approved by the Board, which shall initially be as the date hereof, Xxxxxxx Xxxxxxx, X. Xxxxxxx Xxxxxxxx and Xxxxxxx Xx-Xxxx (each, a “Named Director”); and
(vi) in the event of a reduction to the number of directors that a Principal Holder is entitled to designate pursuant to subsections (i), (ii) or (iii) above (such number, in the aggregate as among all Principal Holders, the “Amount”), up to such number of Independent Directors equal to the Amount (subject to Section 2.3) by recommendation of the NCG Committee, so long as, in each case, each such individual has been approved by the Board. As of the date hereof, the foregoing directors are to be divided into three (3) classes of directors, with each class serving for staggered three (3)-year terms commencing as of the Effective Date as follows:
(a) The Class I directors shall include: (x) two (2) Independent Directors nominated by the NCG Committee and approved by the Board (selected for Class I by the NCG Committee) (y) subject to subsection (vi) of subsection 2.1.1, one (1) Searchlight Director designated by Searchlight Tencent, provided that Tencent shall cease to have such designation right if the aggregate number of Shares (selected calculated on an as-converted basis, and as appropriately adjusted for Class I any share dividend, share split, combination of shares, reorganization, recapitalization, reclassification or other similar event) held by SearchlightTencent and its Affiliates is less than fifty percent (50%) of the number of Shares held by Tencent immediately after the Closing (in which case that designation right shall belong to the Founder Holding Companies), and (z) subject to subsection (vi) of subsection 2.1.1, one (1) Sponsor Director designated by the Sponsor (selected for Class I by the Sponsor);
(b) The Class II directors shall include: (x) subject to subsection (vi) of subsection 2.1.1, one (1) Searchlight Director designated by Searchlight (selected for Class II by Searchlight), (y) subject to subsection (vi) of subsection 2.1.1, one (1) Sponsor Director designated by the Sponsor (selected for Class II by the Sponsor) and (ziii) one (1) Independent Director nominated designated by Xxxxxxxxx, provided that Xxxxxxxxx shall cease to have such designation right if the NCG Committee number of Shares (calculated on an as-converted basis, and approved as appropriately adjusted for any share dividend, share split, combination of shares, reorganization, recapitalization, reclassification or other similar event) held by Xxxxxxxxx and its Affiliates is less than fifty percent (50%) of the number of Shares held by Xxxxxxxxx immediately after the Closing (in which case that designation right shall belong to the Founder Holding Companies). The Chairman of the Board shall be one of the Founder Directors. The Chairman of the Board as of the Closing is Ye Guofu.
(selected b) Each Shareholder agrees that, if at any time it is entitled to vote for Class II by the NCG Committee); andappointment of the Directors, it shall vote all of its Company Securities or execute proxies or written resolutions or consents, as the case may be, and take all other necessary actions (including causing the Company to call an extraordinary general meeting of shareholders) in order to ensure that the composition of the Board is as set forth in this Section 2.01.
(c) The Class III directors Each Director may appoint an Alternate Director from time to time to act during his absence, and such Alternate Director shall include: (x) the CEO be entitled, while holding such office, to receive notices of PubCo and (y) subject to subsection (vi) of subsection 2.1.1 two (2) Pre-Closing Holder Directors designated by the ABRY Entities (selected for Class III by the ABRY Entities). The current term meetings of the Class I directors shall expire immediately following PubCo’s 2025 annual meeting Board or any committee thereof (if the Director who has appointed the Alternate Director is a member of stockholders such committee), and attend and vote as a Director at which directors are elected. The current term of the Class II directors shall expire immediately following PubCo’s 2026 annual meeting of stockholders at which directors are elected. The current term of the Class III directors shall expire immediately following PubCo’s 2024 annual any such meeting at which directors are elected. For the avoidance appointing Director is not present and generally to exercise all the powers, rights, duties and authorities and to perform all functions of doubtthe appointing Director.
(d) Notwithstanding anything to the contrary in this Agreement but except as expressly contemplated in Section 2.01(a), any right to designate any Director is individual to the designation applicable Shareholder and shall not be capable of being transferred or assigned to any Person other than its Permitted Transferee, whether in conjunction with a director Transfer of Company Securities or otherwise.
(e) In the event that a plan for a Qualified IPO is duly approved in accordance with this Agreement, the foregoing Founder Holding Companies shall have the right, at any time prior to the consummation of the Qualified IPO and upon consultation with the Investor Shareholders, to request that one (but not both) of the Investor Directors resign from the Board with immediate effect, in which case the Investor Director as specified by the Founder Holding Companies shall so resign and the Founder Holding Companies shall be in entitled to jointly designate an individual to fill the sole discretion of the Sponsor, Searchlight and the ABRY Entities, as applicable, and, if the Sponsor, Searchlight or the ABRY Entities, as applicable, elect not to so designate a director in accordance with the foregoing, Board seat vacated by such seats shall remain vacant until filled in accordance herewithresignation.
Appears in 2 contracts
Samples: Shareholders Agreement (MINISO Group Holding LTD), Shareholders Agreement (MINISO Group Holding LTD)
Composition of the Board. At and following 4.2.1 Unless otherwise agreed in writing among the date hereofParties, PubCo shall take all Necessary Action to cause the Board to be comprised of up to ten (10) directors (subject to Section 2.3), selected as set forth herein. As of and, except or as otherwise indicated belowprovided under this Agreement, following on and from the date hereofEffective Date, the Board shall includeconsist of twelve (12) Directors appointed in accordance with the terms set out herein:
(a) the Investor (together with its Affiliates) shall:
(i) up to two so long as it collectively holds at least fifty percent (250%) directors designated to PubCo by the ABRY Entities (such directors and any of their respective successors designated pursuant to subsection 2.1.3, each, a “Pre- Closing Holder Director”); provided, that if the ABRY Entities and their respective Affiliates cease to own shares of Common Stock of PubCo representing greater than 5% of the total shares of Common Stock of PubCo then-outstandingShare Capital, then the ABRY Entities shall not have the right to nominate and designate any directors to for election six (6) Directors on the Board and PubCo shall have no further obligations under this subsection 2.1.1(i)Board;
(ii) up for so long as it collectively holds twenty percent (20%) or more of the Share Capital, but less than fifty percent (50%) of the Share Capital, have the right to jointly nominate two (2) directors designated to PubCo by Directors on the Sponsor Board; and
(such directors and any of their respective successors designated pursuant to subsection 2.1.5, each, a “Sponsor Director”); provided, that if Sponsor and its Affiliates cease to own shares of Common Stock of PubCo representing greater than 5% iii) for so long as it collectively holds at least nine percent (9%) of the total shares of Common Stock of PubCo then-outstandingShare Capital, then the Sponsor shall not have the right to designate any directors to jointly nominate one (1) Director on the Board and PubCo shall have no further obligations under this subsection 2.1.1(ii);Board.
(iiib) up the Tatas shall:
(i) for so long as they collectively hold twenty percent (20%) or more of the Share Capital, but less than fifty percent (50%) of the Share Capital, have the right to jointly nominate two (2) directors designated to PubCo by Searchlight Directors on the Board; and
(such directors, and any of their respective successors designated pursuant to subsection 2.1.4, each, a “Searchlight Director”); provided, that if Searchlight and its Affiliates cease to own ii) for so long as Tatas collectively hold at least 7,866,666 shares of Common Stock nine percent (including, for this purpose, shares underlying warrants to purchase shares of Common Stock9%) of PubCo in the aggregate (as proportionately adjusted for stock splitsShare Capital, stock dividends, combinations or reclassifications or the like) (such time, the “Fall-Away of Purchaser Board Rights”), then Searchlight shall not have the right to designate any directors jointly nominate one (1) Director on the Board.
(c) MSIIPL and SMIT shall have the right to jointly nominate one (1) Director on the Board so long as they collectively hold their actual Shareholding as on the Effective Date (such shareholding, the “MSIIPL and PubCo SMIT Effective Date Shareholding”). Notwithstanding anything contained in Clause 4.2.1(c) above, MSIIPL and SMIT’s right to nominate one (1) Director under said clause shall have no further obligations under this subsection 2.1.1(iii);be subject to Clause 27.
(ivd) the chief executive officer of PubCo, whom shall initially be Xxxxx Xxxx;
(v) up to at least three (3) Independent Directors by recommendation of the NCG Committee, so long as, in each case, (or such person has been approved other number as required under applicable Law) shall be appointed by the Board, which shall initially be as subject to the date hereofconsent of the Investor, Xxxxxxx Xxxxxxx, X. Xxxxxxx Xxxxxxxx and Xxxxxxx Xx-Xxxx (each, a “Named Director”); and
(vi) in the event to satisfy any requirements for appointment of a reduction to minimum number of, or qualifications of, Directors under applicable Law.
4.2.2 Unless otherwise agreed in writing among the number Parties, on and from the conversion of directors that the Company into a Principal Holder is entitled to designate pursuant to subsections (i), (ii) or (iii) above (such number, in the aggregate as among all Principal Holdersprivate limited company, the “Amount”), up to such number Board shall consist of Independent seven (7) Directors equal to appointed in accordance with the Amount (subject to Section 2.3) by recommendation of the NCG Committee, so long as, in each case, each such individual has been approved by the Board. As of the date hereof, the foregoing directors are to be divided into three (3) classes of directors, with each class serving for staggered three (3)-year terms commencing as of the Effective Date as followsset out herein:
(a) The Class I directors shall include: the Investor (xtogether with its Affiliates) shall:
(i) so long as it collectively holds at least fifty percent (50%) of the Share Capital, have the right to nominate and designate for election four (4) Directors on the Board;
(ii) for so long as it collectively holds twenty percent (20%) or more of the Share Capital, but less than fifty percent (50%) of the Share Capital, have the right to jointly nominate two (2) Independent Directors nominated by on the NCG Committee and approved by the Board Board; and
(selected iii) for Class I by the NCG Committee) so long as it collectively holds at least nine percent (y) subject to subsection (vi9%) of subsection 2.1.1the Share Capital, have the right to jointly nominate one (1) Searchlight Director designated by Searchlight on the Board.
(selected b) the Tatas shall:
(i) for Class I by Searchlightso long as they collectively hold twenty percent (20%) and or more of the Share Capital, but less than fifty percent (z) subject to subsection (vi50%) of subsection 2.1.1the Share Capital, have the right to jointly nominate two (2) Directors on the Board; and
(ii) for so long as Tatas collectively hold at least nine percent (9%) of the Share Capital, the Tatas have the right to jointly nominate one (1) Sponsor Director designated by on the Sponsor (selected for Class I by the Sponsor);Board.
(bc) The Class II directors MSIIPL and SMIT shall include: (x) subject have the right to subsection (vi) of subsection 2.1.1, jointly nominate one (1) Searchlight Director designated by Searchlight (selected for Class II by Searchlight)on the Board so long as they collectively hold MSIIPL and SMIT Effective Date Shareholding. Notwithstanding anything contained in Clause 4.2.2(c) above, (y) subject MSIIPL’s and SMIT’s joint right to subsection (vi) of subsection 2.1.1, nominate one (1) Sponsor Director designated under said clause shall be subject to Clause 27.
4.2.3 The Party (the “Nominating Party”) entitled to nominate a Director shall be entitled to remove from office any Director so nominated by it and to appoint another nominee in the Sponsor (selected for Class II by place of the Sponsor) and (z) one (1) Independent Director so removed. The Nominating Party shall be entitled, from time to time, to nominate an individual to be appointed as an alternate Director to the Director nominated by the NCG Committee it and approved by the Board shall appoint such Person as an alternate Director for such Director.
4.2.4 The Parties undertake to exercise all their rights (selected including voting rights) and powers and take all requisite actions to ensure that: (a) the Person nominated by a Nominating Party for Class II by appointment as a Director is forthwith appointed as a Director; (b) in case of a Person who is a Director other than an alternate Director, unless such Party changes or withdraws such nomination, such Person is also elected as a Director at the NCG Committee)next General Meeting; and
and (c) The Class III directors shall include: (x) a Director that the CEO of PubCo and (y) subject Nominating Party seeks to subsection (vi) of subsection 2.1.1 two (2) Pre-Closing Holder Directors designated by the ABRY Entities (selected for Class III by the ABRY Entities). The current term of the Class I directors shall expire immediately following PubCo’s 2025 annual meeting of stockholders at which directors are elected. The current term of the Class II directors shall expire immediately following PubCo’s 2026 annual meeting of stockholders at which directors are elected. The current term of the Class III directors shall expire immediately following PubCo’s 2024 annual meeting at which directors are elected. For the avoidance of doubt, the designation of a director remove in accordance with Clause 4.2.3 is promptly removed.
4.2.5 Notwithstanding anything contained in this Clause 4.2, in the foregoing event TTSL and TSL, collectively, cease to have the right to nominate a Director on the Board, TTSL shall have the right to nominate 1 (one) observer (without a right to participate or vote at the meetings) for so long as TTSL remains the Company’s largest customer by gross revenue on an annual basis, is a Shareholder and there has been no change in Control with respect to TTSL’s ownership. Such observer shall be subject to confidentiality obligations in the sole discretion of the Sponsor, Searchlight and the ABRY Entities, same manner as applicable, and, if the Sponsor, Searchlight or the ABRY Entities, as applicable, elect not are applicable to so designate a director in accordance with the foregoing, such seats shall remain vacant until filled in accordance herewithDirectors.
Appears in 2 contracts
Samples: Shareholders Agreement, Shareholder Agreement (American Tower Corp /Ma/)
Composition of the Board. At and following (a) Immediately after the date hereofClosing, PubCo the By-Laws shall take all Necessary Action be amended to cause provide that the Board to be comprised authorized number of up to ten (10) directors (subject to Section 2.3), selected as set forth herein. As of and, except as otherwise indicated below, following the date hereof, comprising the Board shall include:
be eleven, unless changed in accordance with the provisions of this Agreement and the By-Laws. The Board shall initially be composed of (i) five directors, who shall be designated by the Investors prior to the Closing in accordance with Section 6.08 of the Securities Purchase Agreement and Section 9.20 of this Agreement, and (ii) up to two (2) directors six directors, who shall be designated to PubCo by the ABRY Entities Board prior to the Closing in accordance with Section 6.08 of the Securities Purchase Agreement and who are individuals who comply with the Independence Standards (such directors together with their successors elected in accordance with Section 2.02, the “Independent Directors”). In the event that, immediately after the Closing, there are less than six Independent Directors, the vacancies shall be filled in the manner set forth in Section 2.02, except that the individual(s) selected shall be subject to the consent of the Yellowstone Group, which consent shall not be unreasonably withheld. The Investor Designated Directors and any the Independent Directors shall serve in a manner consistent with the terms of their respective successors designated pursuant the Certificate of Incorporation and By-Laws.
(b) From and after the Closing, the parties hereto shall use all reasonable efforts under applicable Law and Nasdaq Regulations to subsection 2.1.3, eachcause there to be (i) so long as the Yellowstone Group beneficially owns 30% or more of the Common Stock, a “Pre- Closing Holder number of Investor Designated Directors that is one less than the majority of the number of then-authorized directors of the Board; (ii) so long as the Yellowstone Group beneficially owns less than 30% but 20% or more of the Common Stock, a number of Investor Designated Directors that is two less than the majority of the number of then-authorized directors of the Board; and (iii) so long as the Yellowstone Group beneficially owns less than 20% but 10% or more of the Common Stock, a number of Investor Designated Directors that is three less than a majority of the number of then-authorized directors of the Board. In the event that, at any time, the number of Investor Designated Directors then in office exceeds the number set forth in the preceding sentence, at the request of the majority of the Independent Directors then in office, an appropriate number of Investor Designated Directors shall resign from office. In the event the Yellowstone Group beneficially owns less than 10% of the Common Stock, the Yellowstone Group shall have no right to designate any Investor Designated Director”, and, at the request of a majority of the Independent Directors then in office, shall cause any Investor Designated Directors then in office to resign immediately upon such event. For purposes of the calculations of the percentages set forth in this Section 2.01(b); provided, that if any shares of voting equity securities issued after the ABRY Entities and their respective Affiliates cease to own date of this Agreement (other than shares of Common Stock of PubCo representing greater than 5% issued upon exercise of the total shares Investor Warrants) shall not be included in the computations of Common Stock beneficial ownership for purposes of PubCo this Section 2.01(b).
(c) At each stockholders’ meeting of the Company at which directors will be elected, the Yellowstone Group shall be entitled, any time prior to the mailing of the applicable proxy statement of the Company, to propose and nominate that number of Investor Designated Directors as set forth in Section 2.01(b) as members of the Board. The Independent Directors to be nominated and elected at any such stockholders’ meeting shall be nominated by a majority of the Independent Directors then in office. The Company and the Board will include the persons so nominated by the members of the Yellowstone Group and the Independent Directors in each slate of directors proposed, recommended or nominated for election by the Company or the Board and will recommend and use all reasonable efforts to cause the election of such persons nominated. The Company agrees to use all reasonable efforts to solicit proxies for such nominees for director from all holders of voting stock entitled to vote thereon. Such nominees shall serve in a manner consistent with the terms of the Certificate of Incorporation and By-Laws.
(d) To the extent required by Nasdaq Regulations, those members of the Board that are not Investor Designated Directors shall at all times satisfy the Independence Standard.
(e) The Board shall take all necessary action, including amending the By-Laws, to provide that at every meeting of the Board, a majority of the directors constituting all of the then-outstandingauthorized total number of directors shall constitute a quorum.
(f) At any time after the Closing, then upon the ABRY Entities request of the Yellowstone Group, the Company and the Board shall not take all actions necessary so that the composition of the board of directors, general partner, managing member (or controlling committee thereof) or any other board or committee serving a similar function with respect to each of the Company’s subsidiaries (each a “Subsidiary Board”) and each committee of each Subsidiary Board shall be proportionate to the composition requirements of the Board and of each committee thereof such that members of the Yellowstone Group shall have the same proportional representation (rounded to the nearest whole number of directors, but in no event less than one) on each Subsidiary Board and committee thereof as the members of the Yellowstone Group have the right to designate any directors to the Board and PubCo shall have no further obligations under this subsection 2.1.1(i);
(ii) up committees thereof. The quorum and action requirements of each Subsidiary Board and of each committee of each Subsidiary Board shall, to two (2) directors designated to PubCo the extent requested by the Sponsor (such directors Yellowstone Group, be the same as the quorum and any action requirements of their respective successors designated pursuant to subsection 2.1.5, each, a “Sponsor Director”); provided, that if Sponsor and its Affiliates cease to own shares of Common Stock of PubCo representing greater than 5% of the total shares of Common Stock of PubCo then-outstanding, then the Sponsor shall not have the right to designate any directors to the Board and PubCo shall have no further obligations under this subsection 2.1.1(ii);
(iii) up to two (2) directors designated to PubCo by Searchlight (such directors, and any of their respective successors designated pursuant to subsection 2.1.4, each, a “Searchlight Director”); provided, that if Searchlight and its Affiliates cease to own at least 7,866,666 shares of Common Stock (including, for this purpose, shares underlying warrants to purchase shares of Common Stock) of PubCo in the aggregate (as proportionately adjusted for stock splits, stock dividends, combinations or reclassifications or the like) (such time, the “Fall-Away of Purchaser Board Rights”), then Searchlight shall not have the right to designate any directors to the Board and PubCo shall have no further obligations under this subsection 2.1.1(iii);
(iv) the chief executive officer of PubCo, whom shall initially be Xxxxx Xxxx;
(v) up to three (3) Independent Directors by recommendation of the NCG Committee, so long as, in each case, such person has been approved by the Board, which shall initially be as the date hereof, Xxxxxxx Xxxxxxx, X. Xxxxxxx Xxxxxxxx and Xxxxxxx Xx-Xxxx (each, a “Named Director”); and
(vi) in the event of a reduction to the number of directors that a Principal Holder is entitled to designate pursuant to subsections (i), (ii) or (iii) above (such number, in the aggregate as among all Principal Holders, the “Amount”), up to such number of Independent Directors equal to the Amount (subject to Section 2.3) by recommendation of the NCG Committee, so long as, in each case, each such individual has been approved by the Board. As of the date hereof, the foregoing directors are to be divided into three (3) classes of directors, with each class serving for staggered three (3)-year terms commencing as of the Effective Date as follows:
(a) The Class I directors shall include: (x) two (2) Independent Directors nominated by the NCG Committee and approved by the Board (selected for Class I by the NCG Committee) (y) subject to subsection (vi) of subsection 2.1.1, one (1) Searchlight Director designated by Searchlight (selected for Class I by Searchlight) and (z) subject to subsection (vi) of subsection 2.1.1, one (1) Sponsor Director designated by the Sponsor (selected for Class I by the Sponsor);
(b) The Class II directors shall include: (x) subject to subsection (vi) of subsection 2.1.1, one (1) Searchlight Director designated by Searchlight (selected for Class II by Searchlight), (y) subject to subsection (vi) of subsection 2.1.1, one (1) Sponsor Director designated by the Sponsor (selected for Class II by the Sponsor) and (z) one (1) Independent Director nominated by the NCG Committee and approved by the Board (selected for Class II by the NCG Committee); and
(c) The Class III directors shall include: (x) the CEO of PubCo and (y) subject to subsection (vi) of subsection 2.1.1 two (2) Pre-Closing Holder Directors designated by the ABRY Entities (selected for Class III by the ABRY Entities). The current term of the Class I directors shall expire immediately following PubCo’s 2025 annual meeting of stockholders at which directors are elected. The current term of the Class II directors shall expire immediately following PubCo’s 2026 annual meeting of stockholders at which directors are elected. The current term of the Class III directors shall expire immediately following PubCo’s 2024 annual meeting at which directors are elected. For the avoidance of doubt, the designation of a director in accordance with the foregoing shall be in the sole discretion of the Sponsor, Searchlight and the ABRY Entities, as applicable, and, if the Sponsor, Searchlight or the ABRY Entities, as applicable, elect not to so designate a director in accordance with the foregoing, such seats shall remain vacant until filled in accordance herewithcommittee thereof.
Appears in 1 contract
Composition of the Board. At and following (a) Subject to Section 2.01(b), commencing on the date hereof, PubCo shall take all Necessary Action to cause the Board to be comprised of up to ten (10) directors (subject to Section 2.3), selected as set forth herein. As of and, except as otherwise indicated below, following the date hereofthis Agreement, the Board shall includeconsist of thirteen directors, comprised as follows:
(i) up to two (2) directors designated to PubCo by the ABRY Entities (such directors and any of their respective successors designated pursuant to subsection 2.1.3, each, a “Pre- Closing Holder Director”); provided, that if the ABRY Entities and their respective Affiliates cease to own shares of Common Stock of PubCo representing greater than 5% of the total shares of Common Stock of PubCo then-outstanding, then the ABRY Entities shall not have the right to designate any directors to the Board and PubCo shall have no further obligations under this subsection 2.1.1(i)Capital Z/Union Square;
(ii) up to two (2) directors designated to PubCo by the Sponsor (such directors and any of their respective successors designated pursuant to subsection 2.1.5, each, a “Sponsor Director”); provided, that if Sponsor and its Affiliates cease to own shares of Common Stock of PubCo representing greater than 5% of the total shares of Common Stock of PubCo then-outstanding, then the Sponsor shall not have the right to designate any directors to the Board and PubCo shall have no further obligations under this subsection 2.1.1(ii)WCAS;
(iii) up to two (2) directors one director designated to PubCo by Searchlight (such directors, and any of their respective successors designated pursuant to subsection 2.1.4, each, a “Searchlight Director”); provided, that if Searchlight and its Affiliates cease to own at least 7,866,666 shares of Common Stock (including, for this purpose, shares underlying warrants to purchase shares of Common Stock) of PubCo in the aggregate (as proportionately adjusted for stock splits, stock dividends, combinations or reclassifications or the like) (such time, the “Fall-Away of Purchaser Board Rights”), then Searchlight shall not have the right to designate any directors to the Board and PubCo shall have no further obligations under this subsection 2.1.1(iii)Lee;
(iv) one director designated by Perry (the chief executive officer directoxx referenced in sub-clauses (i), (ii), (iii) and (iv) of PubCo, whom shall initially be Xxxxx Xxxxthis Section 2.01(a) are sometimes referred to herein each as an "INVESTOR DESIGNEE");
(v) up to three (3) Independent Directors by recommendation one director who shall be the then current Chief Executive Officer of the NCG Committee, so long as, in each case, such person has been approved by the Board, which shall initially be as the date hereof, Xxxxxxx Xxxxxxx, X. Xxxxxxx Xxxxxxxx and Xxxxxxx Xx-Xxxx (each, a “Named Director”)Company; and
(vi) in six additional directors who shall each satisfy the event of a reduction to criteria for "independent director" under the number of directors that a Principal Holder is entitled to designate pursuant to subsections (i), (ii) or (iii) above (such number, in the aggregate as among all Principal Holders, the “Amount”), up to such number of Independent Directors equal to the Amount (subject to Section 2.3) by recommendation rules of the NCG Committee, so long as, in each case, each such individual has been approved by principal stock exchange on which the Board. As of the date hereof, the foregoing directors are to be divided into three (3) classes of directors, with each class serving for staggered three (3)-year terms commencing as of the Effective Date as follows:
(a) The Class I directors shall include: (x) two (2) Independent Directors nominated by the NCG Committee and approved by the Board (selected for Class I by the NCG Committee) (y) subject to subsection (vi) of subsection 2.1.1, one (1) Searchlight Director designated by Searchlight (selected for Class I by Searchlight) and (z) subject to subsection (vi) of subsection 2.1.1, one (1) Sponsor Director designated by the Sponsor (selected for Class I by the Sponsor);Common Stock is listed.
(b) The Class II directors shall include: Going forward, (xi) subject with respect to subsection any Investor that is entitled, pursuant to Section 2.01(a), to designate more than one director, (viA) at such time as such Investor, together with its Permitted Transferees, holds a number of shares of Common Stock that is less than 50% of the number (the "START NUMBER") of subsection 2.1.1shares of Common Stock that such Investor holds on the date of this Agreement, such Investor shall lose the right under this Agreement to designate one of its Investor Designees, and (1B) Searchlight Director designated by Searchlight at such time as such Investor, together with its Permitted Transferees, holds a number of shares of Common Stock that is less than 25% of such Investor's Start Number, such Investor shall no longer have a right under this Agreement to designate any Investor Designees, and (selected for Class II by Searchlightii) with respect to any Investor that is entitled, pursuant to Section 2.01(a), (y) subject to subsection (vi) designate one director, at such time as such Investor, together with its Permitted Transferees, holds a number of subsection 2.1.1shares of Common Stock that is less than 50% of such Investor's Start Number, one (1) Sponsor Director designated such Investor shall no longer have a right under this Agreement to designate any Investor Designees. For purposes of the foregoing sentence, shares of Common Stock held by a Person shall include shares issuable directly or indirectly through conversion or exchange of outstanding Preferred Shares and NVC Shares held by such Person, and irrespective of the Sponsor (selected for Class II by the Sponsor) and (z) one (1) Independent Director nominated by the NCG Committee and approved by the Board (selected for Class II by the NCG Committee); andConversion Limitation. The foregoing calculations shall be appropriately adjusted to take into account any stock reclassification, recapitalization or split, exchange of shares or similar transaction.
(c) The Class III Each Stockholder agrees that, if at any time it is entitled to vote for the election of directors to the Board, it shall include: vote all of its Company Securities that are entitled to vote or execute proxies or written consents, as the case may be, and take all other necessary action (xincluding causing the Company to call a special meeting of stockholders) in order to ensure that the CEO composition of PubCo and the Board is as set forth in this Section 2.01.
(yd) If, as a result of the death, retirement, resignation or, subject to subsection (vi) the other provisions of subsection 2.1.1 two (2) Pre-Closing Holder Directors designated by this Section 2.01, removal, of an Investor Designee there shall exist or occur any vacancy on the ABRY Entities (selected for Class III by Board, the ABRY Entities). The current term Investor entitled to designate such director pursuant to this Section 2.01 shall have the power to designate a person to fill such vacancy, whereupon each of the Class I directors shall expire immediately following PubCo’s 2025 annual Stockholders agrees to take such action as is necessary to promptly elect such person to fill such vacancy (including, if necessary, causing the Company to call a special meeting of stockholders (or effecting a written consent in lieu thereof) and voting all Company Securities that are entitled to vote or execute proxies or written consents to accomplish such result).
(e) Directors may resign at any time. An Investor Designee may be removed at any time for any reason or no reason upon the written direction of the Investor that designated such Investor Designee, effective upon the delivery of such written direction. If any Investor entitled to designate any directors request that any of their respective Investor Designees be removed as a director, each of the Stockholders shall vote all of its Company Securities that are entitled to vote or execute proxies or written consents, as the case may be, and take all other necessary action, to remove such Investor Designee. Each Stockholder agrees that it shall not vote any of its Company Securities in favor of, or take any other action related to, the removal of any Investor Designee who shall have been designated for election to the Board by an Investor pursuant to this Section 2.01 unless the Investor entitled to designate such director shall have consented to such removal in writing or unless such Investor shall have lost the right to designate such director to the Board pursuant to this Section 2.01. If any Investor's right to designate directors shall be reduced by one or more directors, such Investor shall, if so requested by any member of the Board, promptly cause a number of Investor Designees designated by such Investor equal to the number by which such right to designate was reduced to resign from the Board.
(f) If any person serving as the Chief Executive Officer of the Company ("CEO") shall cease to be the CEO, then, unless otherwise determined by a majority of the other members of the Board, such former CEO shall cease to be a member of the Board and the new CEO shall be appointed as a member of the Board in place of the former CEO.
(g) The Company agrees to cause each individual designated for director pursuant to this Section 2.01 to be nominated, by all necessary and appropriate action, to serve as a director on the Board (including, to the extent required, by the Nominating Committee of the Board recommending that such designees be included in each slate of director nominees and by the Board presenting such slate for election to the Board) and to take all other actions as may be necessary to ensure that the composition of the Board is as set forth in this Section 2.01.
(h) To the extent permitted by applicable law and the rules of the principal stock exchange on which the Common Stock is listed, each Investor with an Investor Designee serving on the Board shall be entitled to have at least one of its Investor Designees serve on all committees of the Board.
(i) Any vacancies on the Board not filled pursuant to the forgoing principles shall be filled by an individual to be nominated by the Nominating Committee of the Board.
(j) Subject to the provisions of Section 4.01, an Investor Designee shall be entitled to supply details of any business transacted at Board meetings, and any other information obtained by him or her in his or her capacity as a director of the Company, to the Investor that designated such director to the Board and to that Investor's Affiliates and professional advisers.
(k) The Company shall reimburse all reasonable out-of-pocket expenses incurred by the members of the Board in connection with traveling to and from and attending meetings of the Board and while conducting business at the request of the Company.
(l) The Company shall use its reasonable best efforts to purchase and maintain, at its expense, insurance, from reputable carriers and in an amount determined in good faith by the Board to be appropriate, on behalf of and covering the individuals who at any time on and after the date of this Agreement are or become directors or officers of the Company, or serve at the request of the Company as a director, officer, employee or agent of another company, joint venture, trust or other enterprise, against any expense, liability or loss asserted against or incurred by such individual in any such capacity, or arising out of such individual's status as such, subject to customary exclusions.
(m) The rights granted to a Stockholder hereunder are in addition to all rights to which such Stockholder is entitled as a security holder of the Company under the Company's certificate of incorporation and by-laws, as in effect from time to time, and applicable law.
(n) In addition, subject to the last sentence of this clause, WCAS shall be entitled to designate one individual as a non-voting Board observer ("NON-VOTING OBSERVER"). With the exception of meetings of the Board (or portions thereof) at which directors are elected. The current term an Investor Designee designated by WCAS pursuant to Section 2.01(a)(ii) is recused, such Non-Voting Observer shall be allowed to attend and observe meetings of the Class II directors Board, provided that such Non-Voting Observer shall expire immediately following PubCo’s 2026 annual meeting agree with the Company to maintain the confidentiality, in accordance with Section 4.01, of stockholders at which directors are elected. The current term of the Class III directors shall expire immediately following PubCo’s 2024 annual meeting at which directors are electedall non-public information obtained in connection with being a Non-Voting Observer. For the avoidance of doubt, the designation of Non-Voting Observer is not a director in accordance of the Company and shall have no right to vote on any matter coming to a vote of the Board. At such time as WCAS, together with its Permitted Transferees, holds a number of shares of Common Stock that is less than 25% of WCAS's Start Number, WCAS shall no longer have a right to designate a Non-Voting Observer (for purposes of this sentence, shares of Common Stock held by a Person shall include shares issuable directly or indirectly through conversion or exchange of outstanding Preferred Shares and NVC Shares held by such Person, and irrespective of the Conversion Limitation; and the foregoing calculation shall be in appropriately adjusted to take into account any stock reclassification, recapitalization or split, exchange of shares or similar transaction).
(o) To the sole discretion extent, if any, that any of the Sponsorprinciples of this Article 2 conflict with any applicable law or any rules of the principal stock exchange on which the Common Stock is at the time listed and that are applicable to and binding upon the Company, Searchlight the Company and the ABRY Entities, Stockholders shall make such elections under such rules and take any and all other actions as applicable, and, if may be necessary in order to enable the Sponsor, Searchlight or purposes and intents of this Article 2 to be carried out to the ABRY Entities, as applicable, elect not to so designate a director fullest extent in accordance compliance with the foregoing, such seats shall remain vacant until filled in accordance herewithlaws and rules.
Appears in 1 contract
Samples: Stockholders' Agreement (Capital Z Financial Services Fund Ii Lp)
Composition of the Board. At and following (a) Until the date hereofMajority Ownership Requirement is no longer met, PubCo shall take all Necessary Action to cause the Holders holding a majority of the shares of Class B Common Stock held by the Holders may, by means of a written resolution or consent in lieu thereof, designate the nominees for a majority of the members of the Board to be comprised of up to ten (10) directors (subject to Section 2.3)Directors, selected as set forth herein. As including the Chair of and, except as otherwise indicated below, following the date hereof, the Board shall includeof Directors. (b) From and after the time the Majority Ownership Requirement is no longer met:
(i) up to two for so long as the Holders collectively beneficially own (2within the meaning of Rule 13d-3 and Rule 13d-5 under the Exchange Act) directors designated to PubCo by the ABRY Entities (such directors and any of their respective successors designated pursuant to subsection 2.1.3, each, a “Pre- Closing Holder Director”); provided, that if the ABRY Entities and their respective Affiliates cease to own shares of Common Stock of PubCo representing greater than 5% at least forty percent (40%) of the total issued and outstanding shares of Common Stock, the Holders holding a majority of the shares of Class B Common Stock held by the Holders may, by means of PubCo then-outstandinga written resolution or consent in lieu thereof, then designate the ABRY Entities shall not have nominees for forty percent (40%) of the right to designate any directors members of the Board of Directors, rounded up to the Board and PubCo shall have no further obligations under this subsection 2.1.1(i)nearest whole number;
(ii) up to two so long as the Holders collectively beneficially own (2within the meaning of Rule 13d-3 and Rule 13d-5 under the Exchange Act) directors designated to PubCo by the Sponsor (such directors and any of their respective successors designated pursuant to subsection 2.1.5, each, a “Sponsor Director”); provided, that if Sponsor and its Affiliates cease to own shares of Common Stock of PubCo representing greater at least thirty percent (30%) but less than 5% forty percent (40%) of the total issued and outstanding shares of Common Stock, the Holders holding a majority of the shares of Class B Common Stock held by the Holders may, by means of PubCo then-outstandinga written resolution or consent in lieu thereof, then designate the Sponsor shall not have nominees for thirty percent (30%) of the right to designate any directors members of the Board of Directors, rounded up to the Board and PubCo shall have no further obligations under this subsection 2.1.1(ii)nearest whole number;
(iii) up to two for so long as the Holders collectively beneficially own (2within the meaning of Rule 13d-3 and Rule 13d-5 under the Exchange Act) directors designated to PubCo by Searchlight (such directors, and any of their respective successors designated pursuant to subsection 2.1.4, each, a “Searchlight Director”); provided, that if Searchlight and its Affiliates cease to own at least 7,866,666 shares of Common Stock representing at least twenty percent (including, for this purpose, shares underlying warrants to purchase 20%) but less than thirty percent (30%) of the issued and outstanding shares of Common Stock, the Holders holding a majority of the shares of Class B Common Stock held by the Holders may, by means of a written resolution or consent in lieu thereof, designate the nominees for twenty percent (20%) of PubCo in the aggregate (as proportionately adjusted for stock splitsmembers of the Board of Directors, stock dividends, combinations or reclassifications or the like) (such time, the “Fall-Away of Purchaser Board Rights”), then Searchlight shall not have the right to designate any directors rounded up to the Board and PubCo shall have no further obligations under this subsection 2.1.1(iii);nearest whole number; and
(iv) for so long as the chief executive officer Substantial Ownership Requirement is met but the Holders collectively beneficially own (within the meaning of PubCoRule 13d-3 and Rule 13d-5 under the Exchange Act) shares of Common Stock representing less than twenty percent (20%) of the issued and outstanding shares of Common Stock, whom shall initially be Xxxxx Xxxx;
the Holders holding a majority of the shares of Class B Common Stock held by the Holders may, by means of a written resolution or consent in lieu thereof, designate the nominees for ten percent (v10%) of the members of the Board of Directors, rounded up to three (3) Independent Directors by recommendation of the NCG Committee, so long as, in each case, such person has been approved by the Board, which shall initially be as the date hereof, Xxxxxxx Xxxxxxx, X. Xxxxxxx Xxxxxxxx and Xxxxxxx Xx-Xxxx (each, a “Named Director”); and
(vi) in the event of a reduction to the number of directors that a Principal Holder is entitled to designate pursuant to subsections (i), (ii) or (iii) above (such nearest whole number, in the aggregate as among all Principal Holders, the “Amount”), up to such number of Independent Directors equal to the Amount (subject to Section 2.3) by recommendation of the NCG Committee, so long as, in each case, each such individual has been approved by the Board. As of the date hereof, the foregoing directors are to be divided into three (3) classes of directors, with each class serving for staggered three (3)-year terms commencing as of the Effective Date as follows:
(a) The Class I directors shall include: (x) two (2) Independent Directors nominated by the NCG Committee and approved by the Board (selected for Class I by the NCG Committee) (y) subject to subsection (vi) of subsection 2.1.1, one (1) Searchlight Director designated by Searchlight (selected for Class I by Searchlight) and (z) subject to subsection (vi) of subsection 2.1.1, one (1) Sponsor Director designated by the Sponsor (selected for Class I by the Sponsor);
(b) The Class II directors shall include: (x) subject to subsection (vi) of subsection 2.1.1, one (1) Searchlight Director designated by Searchlight (selected for Class II by Searchlight), (y) subject to subsection (vi) of subsection 2.1.1, one (1) Sponsor Director designated by the Sponsor (selected for Class II by the Sponsor) and (z) one (1) Independent Director nominated by the NCG Committee and approved by the Board (selected for Class II by the NCG Committee); and
(c) The Class III directors shall include: (x) the CEO of PubCo and (y) subject to subsection (vi) of subsection 2.1.1 two (2) Pre-Closing Holder Directors designated by the ABRY Entities (selected for Class III by the ABRY Entities). The current term of the Class I directors shall expire immediately following PubCo’s 2025 annual meeting of stockholders at which directors are elected. The current term of the Class II directors shall expire immediately following PubCo’s 2026 annual meeting of stockholders at which directors are elected. The current term of the Class III directors shall expire immediately following PubCo’s 2024 annual meeting at which directors are elected. For the avoidance of doubt, the designation of right to nominate a director for election to the Board of Directors set forth in accordance with the foregoing this clause (b) shall be in addition to the sole discretion rights of the SponsorHolders pursuant to clause (a) above.
(c) In the absence of any designation from the Persons or groups with the right to designate a director as specified in Sections 1.02(a) or (b) above, Searchlight the director or directors previously designated by them and then serving shall be reelected if still eligible to serve as provided herein.
(d) At any time during the ABRY Entitiesterm of this Agreement, at least one member of Board of Directors who was designated by BDT pursuant to this Section 1.02 or otherwise (a “BDT Designee”) shall have the right to attend all meetings of any committees of the Board of Directors of which such BDT Designee is not a member in a non-voting, observer capacity; provided, however, that during any period that BDT is unable to designate a BDT Designee, BDT shall have the right to designate one individual (the “BDT Observer”) to attend all meetings of the Board of Directors, and all committees thereof, in a non-voting, observer capacity and Pubco shall provide to the BDT Observer notice of such meetings and, subject to the confidentiality provisions in Section 1.03, a copy of all materials provided to the members of the Board of Directors or any committees thereof, as applicable, andin their capacity as such, if and shall provide the SponsorBDT Observer with the same rights to expense reimbursement that it provides to such other members; provided, Searchlight further, however, that the Board of Directors or any committee thereof shall be entitled to withhold any information and exclude the ABRY EntitiesBDT Observer from those portions of any meeting which in the good-faith determination of the Board of Directors or such committee thereof, as applicable, elect not is reasonably necessary to so designate a director in accordance with protect the foregoingattorney-client privilege of Pubco or any of its Subsidiaries, such seats shall remain vacant until filled in accordance herewithas applicable.
Appears in 1 contract
Samples: Shareholder Agreement (Weber Inc.)
Composition of the Board. At and following (a) Immediately after the date hereofClosing, PubCo the By-Laws shall take all Necessary Action be amended to cause provide that the Board to be comprised authorized number of up to ten (10) directors (subject to Section 2.3), selected as set forth herein. As of and, except as otherwise indicated below, following the date hereof, comprising the Board shall include:
be eleven, unless changed in accordance with the provisions of this Agreement and the By-Laws. The Board shall initially be composed of (i) five directors, who shall be designated by the Investors prior to the Closing in accordance with Section 6.08 of the Securities Purchase Agreement and Section 9.20 of this Agreement, and (ii) up to two (2) directors six directors, who shall be designated to PubCo by the ABRY Entities Board prior to the Closing in accordance with Section 6.08 of the Securities Purchase Agreement and who are individuals who comply with the Independence Standards (such directors together with their successors elected in accordance with Section 2.02, the “Independent Directors”). In the event that, immediately after the Closing, there are less than six Independent Directors, the vacancies shall be filled in the manner set forth in Section 2.02, except that the individual(s) selected shall be subject to the consent of the Investor Group, which consent shall not be unreasonably withheld. The Investor Designated Directors and any the Independent Directors shall serve in a manner consistent with the terms of their respective successors designated pursuant the Certificate of Incorporation and By-Laws.
(b) From and after the Closing, the parties hereto shall use all reasonable efforts under applicable Law and Nasdaq Regulations to subsection 2.1.3, eachcause there to be (i) so long as the Investor Group beneficially owns 30% or more of the Common Stock, a “Pre- Closing Holder number of Investor Designated Directors that is one less than the majority of the number of then-authorized directors of the Board; (ii) so long as the Investor Group beneficially owns less than 30% but 20% or more of the Common Stock, a number of Investor Designated Directors that is two less than the majority of the number of then-authorized directors of the Board; and (iii) so long as the Investor Group beneficially owns less than 20% but 10% or more of the Common Stock, a number of Investor Designated Directors that is three less than a majority of the number of then-authorized directors of the Board. In the event that, at any time, the number of Investor Designated Directors then in office exceeds the number set forth in the preceding sentence, at the request of the majority of the Independent Directors then in office, an appropriate number of Investor Designated Directors shall resign from office. In the event the Investor Group beneficially owns less than 10% of the Common Stock, the Investor Group shall have no right to designate any Investor Designated Director”, and, at the request of a majority of the Independent Directors then in office, shall cause any Investor Designated Directors then in office to resign immediately upon such event. For purposes of the calculations of the percentages set forth in this Section 2.01(b); provided, that if any shares of voting equity securities issued after the ABRY Entities and their respective Affiliates cease to own date of this Agreement (other than shares of Common Stock of PubCo representing greater than 5% issued upon exercise of the total shares Investor Warrants) shall not be included in the computations of Common Stock beneficial ownership for purposes of PubCo this Section 2.01(b).
(c) At each stockholders’ meeting of the Company at which directors will be elected, the Investor Group shall be entitled, any time prior to the mailing of the applicable proxy statement of the Company, to propose and nominate that number of Investor Designated Directors as set forth in Section 2.01(b) as members of the Board. The Independent Directors to be nominated and elected at any such stockholders’ meeting shall be nominated by a majority of the Independent Directors then in office. The Company and the Board will include the persons so nominated by the members of the Investor Group and the Independent Directors in each slate of directors proposed, recommended or nominated for election by the Company or the Board and will recommend and use all reasonable efforts to cause the election of such persons nominated. The Company agrees to use all reasonable efforts to solicit proxies for such nominees for director from all holders of voting stock entitled to vote thereon. Such nominees shall serve in a manner consistent with the terms of the Certificate of Incorporation and By-Laws.
(d) To the extent required by Nasdaq Regulations, those members of the Board that are not Investor Designated Directors shall at all times satisfy the Independence Standard.
(e) The Board shall take all necessary action, including amending the By-Laws, to provide that at every meeting of the Board, a majority of the directors constituting all of the then-outstandingauthorized total number of directors shall constitute a quorum.
(f) At any time after the Closing, then upon the ABRY Entities request of the Investor Group, the Company and the Board shall not take all actions necessary so that the composition of the board of directors, general partner, managing member (or controlling committee thereof) or any other board or committee serving a similar function with respect to each of the Company’s subsidiaries (each a “Subsidiary Board”) and each committee of each Subsidiary Board shall be proportionate to the composition requirements of the Board and of each committee thereof such that members of the Investor Group shall have the same proportional representation (rounded to the nearest whole number of directors, but in no event less than one) on each Subsidiary Board and committee thereof as the members of the Investor Group have the right to designate any directors to the Board and PubCo shall have no further obligations under this subsection 2.1.1(i);
(ii) up committees thereof. The quorum and action requirements of each Subsidiary Board and of each committee of each Subsidiary Board shall, to two (2) directors designated to PubCo the extent requested by the Sponsor (such directors Investor Group, be the same as the quorum and any action requirements of their respective successors designated pursuant to subsection 2.1.5, each, a “Sponsor Director”); provided, that if Sponsor and its Affiliates cease to own shares of Common Stock of PubCo representing greater than 5% of the total shares of Common Stock of PubCo then-outstanding, then the Sponsor shall not have the right to designate any directors to the Board and PubCo shall have no further obligations under this subsection 2.1.1(ii);
(iii) up to two (2) directors designated to PubCo by Searchlight (such directors, and any of their respective successors designated pursuant to subsection 2.1.4, each, a “Searchlight Director”); provided, that if Searchlight and its Affiliates cease to own at least 7,866,666 shares of Common Stock (including, for this purpose, shares underlying warrants to purchase shares of Common Stock) of PubCo in the aggregate (as proportionately adjusted for stock splits, stock dividends, combinations or reclassifications or the like) (such time, the “Fall-Away of Purchaser Board Rights”), then Searchlight shall not have the right to designate any directors to the Board and PubCo shall have no further obligations under this subsection 2.1.1(iii);
(iv) the chief executive officer of PubCo, whom shall initially be Xxxxx Xxxx;
(v) up to three (3) Independent Directors by recommendation of the NCG Committee, so long as, in each case, such person has been approved by the Board, which shall initially be as the date hereof, Xxxxxxx Xxxxxxx, X. Xxxxxxx Xxxxxxxx and Xxxxxxx Xx-Xxxx (each, a “Named Director”); and
(vi) in the event of a reduction to the number of directors that a Principal Holder is entitled to designate pursuant to subsections (i), (ii) or (iii) above (such number, in the aggregate as among all Principal Holders, the “Amount”), up to such number of Independent Directors equal to the Amount (subject to Section 2.3) by recommendation of the NCG Committee, so long as, in each case, each such individual has been approved by the Board. As of the date hereof, the foregoing directors are to be divided into three (3) classes of directors, with each class serving for staggered three (3)-year terms commencing as of the Effective Date as follows:
(a) The Class I directors shall include: (x) two (2) Independent Directors nominated by the NCG Committee and approved by the Board (selected for Class I by the NCG Committee) (y) subject to subsection (vi) of subsection 2.1.1, one (1) Searchlight Director designated by Searchlight (selected for Class I by Searchlight) and (z) subject to subsection (vi) of subsection 2.1.1, one (1) Sponsor Director designated by the Sponsor (selected for Class I by the Sponsor);
(b) The Class II directors shall include: (x) subject to subsection (vi) of subsection 2.1.1, one (1) Searchlight Director designated by Searchlight (selected for Class II by Searchlight), (y) subject to subsection (vi) of subsection 2.1.1, one (1) Sponsor Director designated by the Sponsor (selected for Class II by the Sponsor) and (z) one (1) Independent Director nominated by the NCG Committee and approved by the Board (selected for Class II by the NCG Committee); and
(c) The Class III directors shall include: (x) the CEO of PubCo and (y) subject to subsection (vi) of subsection 2.1.1 two (2) Pre-Closing Holder Directors designated by the ABRY Entities (selected for Class III by the ABRY Entities). The current term of the Class I directors shall expire immediately following PubCo’s 2025 annual meeting of stockholders at which directors are elected. The current term of the Class II directors shall expire immediately following PubCo’s 2026 annual meeting of stockholders at which directors are elected. The current term of the Class III directors shall expire immediately following PubCo’s 2024 annual meeting at which directors are elected. For the avoidance of doubt, the designation of a director in accordance with the foregoing shall be in the sole discretion of the Sponsor, Searchlight and the ABRY Entities, as applicable, and, if the Sponsor, Searchlight or the ABRY Entities, as applicable, elect not to so designate a director in accordance with the foregoing, such seats shall remain vacant until filled in accordance herewithcommittee thereof.
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