Director Nomination Rights. Subject to the terms and conditions of this Agreement, at any time and from time to time on or after the date that the Company consummates a Business Combination and for so long as the Sponsor holds any Registrable Securities: 5.1.1 The Sponsor shall have the right, but not the obligation, to designate three individuals to be appointed or nominated, as the case may be, for election to the Board (including any successor, each, a “Nominee”) by giving written notice to the Company on or before the time such information is reasonably requested by the Board or the Nominating Committee of the Board, as applicable, for inclusion in a proxy statement for a meeting of stockholders provided to the Sponsor. 5.1.2 The Company will, as promptly as practicable, use its best efforts to take all necessary and desirable actions (including, without limitation, calling special meetings of the Board and the stockholders and recommending, supporting and soliciting proxies) so that there are three Sponsor Directors serving on the Board at all times. 5.1.3 The Company shall, to the fullest extent permitted by applicable law, use its best efforts to take all actions necessary to ensure that: (i) each Nominee is included in the Board’s slate of nominees to the stockholders of the Company for each election of directors; and (ii) each Nominee is included in the proxy statement prepared by management of the Company in connection with soliciting proxies for every meeting of the stockholders of the Company called with respect to the election of members of the Board, and at every adjournment or postponement thereof, and on every action or approval by written consent of the stockholders of the Company or the Board with respect to the election of members of the Board. 5.1.4 If a vacancy occurs because of the death, disability, disqualification, resignation, or removal of a Sponsor Director or for any other reason, the Sponsor shall be entitled to designate such person’s successor, and the Company will, as promptly as practicable following such designation, use its best efforts to take all necessary and desirable actions, to the fullest extent permitted by law, within its control such that such vacancy shall be filled with such successor Nominee. 5.1.5 If a Nominee is not elected because of such Nominee’s death, disability, disqualification, withdrawal as a nominee or for any other reason, the Sponsor shall be entitled to designate promptly another Nominee and the Company will take all necessary and desirable actions within its control such that the director position for which such Nominee was nominated shall not be filled pending such designation or the size of the Board shall be increased by one and such vacancy shall be filled with such successor Nominee as promptly as practicable following such designation. 5.1.6 As promptly as reasonably practicable following the request of any Sponsor Director, the Company shall enter into an indemnification agreement with such Sponsor Director, in the form entered into with the other members of the Board. The Company shall pay the reasonable, documented out-of-pocket expenses incurred by the Sponsor Director in connection with his or her services provided to or on behalf of the Company, including attending meetings or events attended explicitly on behalf of the Company at the Company’s request. 5.1.7 The Company shall (i) purchase directors’ and officers’ liability insurance in an amount determined by the Board to be reasonable and customary and (ii) for so long as a Sponsor Director serves as a director of the Company, maintain such coverage with respect to such Sponsor Director; provided that upon removal or resignation of such Sponsor Director for any reason, the Company shall take all actions reasonably necessary to extend such directors’ and officers’ liability insurance coverage for a period of not less than six years from any such event in respect of any act or omission occurring at or prior to such event. 5.1.8 For so long as a Sponsor Director serves as a director of the Company, the Company shall not amend, alter or repeal any right to indemnification or exculpation covering or benefiting any director nominated pursuant to this Agreement as and to the extent consistent with applicable law, whether such right is contained in the Company’s certificate of incorporation or bylaws, each as amended, or another document (except to the extent such amendment or alteration permits the Company to provide broader indemnification or exculpation rights on a retroactive basis than permitted prior thereto). 5.1.9 Each Nominee may, but does not need to qualify as “independent” pursuant to listing standards of the New York Stock Exchange (or such other national securities exchange upon which the Company’s securities are then listed). 5.1.10 Any Nominee will be subject to the Company’s customary due diligence process, including its review of a completed questionnaire and a background check. Based on the foregoing, the Company may object to any Nominee provided (a) it does so in good faith, and (b) such objection is based upon any of the following: (i) such Nominee was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses), (ii) such Nominee was the subject of any order, judgment, or decree not subsequently reversed, suspended or vacated of any court of competent jurisdiction, permanently or temporarily enjoining such proposed director from, or otherwise limiting, the following activities: (A) engaging in any type of business practice, or (B) engaging in any activity in connection with the purchase or sale of any security or in connection with any violation of federal or state securities laws, (iii) such Nominee was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described in clause (ii)(B), or to be associated with persons engaged in such activity, (iv) such proposed director was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any federal or state securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended or vacated, or (v) such proposed director was the subject of, or a party to any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to a violation of any federal or state securities laws or regulations. In the event the Board reasonably finds the Nominee to be unsuitable based upon one or more of the foregoing clauses (i) through (v) and reasonably objects to the identified director, Sponsor shall be entitled to propose a different nominee to the Board within 30 calendar days of the Company’s notice to Sponsor of its objection to the Nominee and such replacement Nominee shall be subject to the review process outlined above. 5.1.11 The Company shall take all necessary action to cause a Nominee chosen by the Sponsor, at the request of such Nominee to be elected to the board of directors (or similar governing body) of each material operating subsidiary of the Company. The Nominee, as applicable, shall have the right to attend (in person or remotely) any meetings of the board of directors (or similar governing body or committee thereof) of each subsidiary of the Company.
Appears in 8 contracts
Samples: Registration and Stockholder Rights Agreement (Excolere Acquisition Corp.), Registration and Stockholder Rights Agreement (Arena Fortify Acquisition Corp.), Registration and Stockholder Rights Agreement (Excolere Acquisition Corp.)
Director Nomination Rights. Subject to (a) Until the terms and conditions of this AgreementTrigger Date, at any time and from time to time on or after the date that the Company consummates a Business Combination and for so long as the Sponsor holds any Registrable Securities:
5.1.1 The Sponsor shall have the right, but not the obligation, to designate three individuals to be appointed or nominated, as the case may be, for election to the Board (including any successor, each, a “Nominee”) by giving written notice to the Company on or before the time such information is reasonably requested by the Board or the Nominating Committee of the Board, as applicable, for inclusion in a proxy statement for a meeting of stockholders provided to the Sponsor.
5.1.2 The Company will, as promptly as practicable, use its best efforts to take all necessary and desirable actions (including, without limitation, calling special meetings of the Board and the stockholders and recommending, supporting and soliciting proxies) so that there are three Sponsor Directors serving on the Board at all times.
5.1.3 The Company shall, to the fullest extent permitted by applicable law, use its best efforts to take all actions necessary to ensure that: (i) each Nominee is included in the Board’s slate of nominees to the stockholders of the Company for each election of directors; and (ii) each Nominee is included in the proxy statement prepared by management of the Company in connection with soliciting proxies for every any annual or special meeting of the stockholders of the Company called at which directors shall be elected, GE shall have the right to designate six (6) persons for nomination by the Company Board for election to the Company Board (each person so designated, a “GE Designee”). Until the Trigger Date, GE shall have full authority and ability to nominate, elect and remove the GE Designees in accordance with respect Section 3.2(c) in the case of the nomination or election of the GE Designees. GE shall not designate any person to be a GE Designee who it believes does not meet the requirements for director nominees as set forth in the applicable policies of the Company relating to director qualification from time to time. The Company Board shall promptly and in good faith consider each GE Designee designated pursuant to this Section 3.2(a), applying the same standards as shall be applied for the consideration of other proposed nominees of the Company Board. In the event that the Company Board fails to approve the nomination of any GE Designee, GE shall have the right to designate an alternative GE Designee for consideration. For the avoidance of doubt, current or former employment of any GE Designee by GE or any of its Subsidiaries or service by any such GE Designee on the board of directors of GE or any of its Subsidiaries shall not disqualify such individual from serving on the Company Board as a GE Designee.
(b) Notwithstanding Section 3.2(a), until the Trigger Date, if the size of the Company Board shall, with GE’s prior written approval or otherwise, be increased or decreased, GE shall have the right to designate one or more GE Designees to the Company Board such that the total number of GE Directors on the Company Board shall be proportional (rounded up to the nearest whole number) to the number of GE Directors on the Company Board set forth in Section 3.1(a).
(c) The Company shall cause each GE Designee and Non-GE Designee whose nomination has been approved to be included in the slate of nominees recommended by the Company Board to holders of Company Common Stock for election (including at any special meeting of stockholders held for the election of members of the Board, directors) and at every adjournment or postponement thereof, and on every action or approval by written consent of the stockholders of the Company or the Board with respect to the election of members of the Board.
5.1.4 If a vacancy occurs because of the death, disability, disqualification, resignation, or removal of a Sponsor Director or for any other reason, the Sponsor shall be entitled to designate such person’s successor, and the Company will, as promptly as practicable following such designation, use its best efforts to take all necessary cause the election of each such GE Designee and desirable actionsNon-GE Designee, to including soliciting proxies in favor of the fullest extent permitted by law, within its control election of such that such vacancy shall be filled with such successor Nomineepersons.
5.1.5 If a Nominee is not elected because of such Nominee’s death, disability, disqualification, withdrawal as a nominee or for any other reason, (d) Until the Sponsor shall be entitled to designate promptly another Nominee and the Company will take all necessary and desirable actions within its control such that the director position for which such Nominee was nominated shall not be filled pending such designation or the size of the Board shall be increased by one and such vacancy shall be filled with such successor Nominee as promptly as practicable following such designation.
5.1.6 As promptly as reasonably practicable following the request of any Sponsor Director, the Company shall enter into an indemnification agreement with such Sponsor DirectorTrigger Date, in the form entered into with the other members of the Board. The Company event that any GE Director shall pay the reasonable, documented out-of-pocket expenses incurred by the Sponsor Director in connection with his or her services provided cease to or on behalf of the Company, including attending meetings or events attended explicitly on behalf of the Company at the Company’s request.
5.1.7 The Company shall (i) purchase directors’ and officers’ liability insurance in an amount determined by the Board to be reasonable and customary and (ii) for so long as a Sponsor Director serves serve as a director of the Company, maintain such coverage with respect to such Sponsor Director; provided that upon removal or resignation of such Sponsor Director for any reason, the vacancy resulting therefrom shall be filled by the Company shall take all actions reasonably necessary to extend such directors’ Board with a substitute GE Director.
(e) From and officers’ liability insurance coverage for after the date hereof, in the event of a period of not less than six years vacancy on the Company Board upon the death, resignation, retirement, disqualification, removal from any such event in respect office or other cause of any act director who was not a GE Designee, the Governance & Nominating Committee shall have the sole right to fill such vacancy or omission occurring at or prior designate a person for nomination, reasonably acceptable to GE, for election to the Company Board to fill such eventvacancy (each such person, a “Non-GE Designee”).
5.1.8 For so long as a Sponsor Director serves as a director of (f) Until the CompanyTrigger Date, the Company shall not amend, alter or repeal any right to indemnification or exculpation covering or benefiting any director nominated pursuant to this Agreement as and avail itself of all available “controlled company” exceptions to the extent consistent with applicable law, whether such right is contained in the Company’s certificate of incorporation or bylaws, each as amended, or another document (except to the extent such amendment or alteration permits the Company to provide broader indemnification or exculpation rights on a retroactive basis than permitted prior thereto).
5.1.9 Each Nominee may, but does not need to qualify as “independent” pursuant to corporate governance listing standards of the New York Stock Exchange (or such other national securities exchange upon which the Company’s securities are then listed).
5.1.10 Any Nominee will be subject to the Company’s customary due diligence processNYSE, including its review of a completed questionnaire and a background check. Based on the foregoingand, thereafter, the Company may object to any Nominee provided (a) it does so in good faith, and (b) such objection is based upon any shall comply with the corporate governance listing standards of the following: (i) such Nominee was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses)NYSE, (ii) such Nominee was the subject of any order, judgment, or decree not subsequently reversed, suspended or vacated of any court of competent jurisdiction, permanently or temporarily enjoining such proposed director from, or otherwise limiting, the following activities: (A) engaging in any type of business practice, or (B) engaging in any activity in connection with the purchase or sale of any security or in connection with any violation of federal or state securities laws, (iii) such Nominee was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described in clause (ii)(B), or to be associated with persons engaged in such activity, (iv) such proposed director was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any federal or state securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended or vacated, or (v) such proposed director was the subject of, or a party to any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, including those relating to a violation of any federal or state securities laws or regulations. In the event the Board reasonably finds the Nominee to be unsuitable based upon one or more composition of the foregoing clauses (i) through (v) and reasonably objects to the identified director, Sponsor shall be entitled to propose a different nominee to the Board within 30 calendar days committees of the Company’s notice to Sponsor of its objection to the Nominee and such replacement Nominee shall be subject to the review process outlined aboveCompany Board.
5.1.11 The Company shall take all necessary action to cause a Nominee chosen by (g) For the Sponsoravoidance of doubt, at the request of such Nominee to be elected to the board of directors (or similar governing body) of each material operating subsidiary of the Company. The Nominee, as applicable, GE shall have the right right, in its sole discretion, to attend (in person or remotely) waive any meetings and all of the board rights granted to it under this Section 3.2, by delivery of directors (or similar governing body or committee thereof) of each subsidiary of written notice to the CompanyCompany in accordance with Section 7.4.
Appears in 3 contracts
Samples: Shareholder Agreement, Shareholder Agreement (Baker Hughes a GE Co), Transaction Agreement and Plan of Merger (Baker Hughes Inc)
Director Nomination Rights. Subject to the terms and conditions of this Agreement, at any time and from time to time on or after the date that the Company consummates a Business Combination and for so long as the Sponsor holds any Registrable Securities:
5.1.1 The Sponsor shall have the right, but not the obligation, to designate three individuals to be appointed or nominated, as the case may be, for election to the Board (including any successor, each, a “Nominee”) by giving written notice to the Company on or before the time such information is reasonably requested by the Board or the Nominating Committee of the Board, as applicable, for inclusion in a proxy statement for a meeting of stockholders provided to the Sponsor.
5.1.2 The Company will, as promptly as practicable, use its best efforts to take all necessary and desirable actions (including, without limitation, calling special meetings of the Board and the stockholders and recommending, supporting and soliciting proxies) so that there are three Sponsor Directors serving on the Board at all times.
5.1.3 The Company shall, to the fullest extent permitted by applicable law, use its best efforts to take all actions necessary to ensure that: (i) each Nominee is included in the Board’s slate of nominees to the stockholders of the Company for each election of directors; and (ii) each Nominee is included in the proxy statement prepared by management of the Company in connection with soliciting proxies for every meeting of the stockholders of the Company called with respect to the election of members of the Board, and at every adjournment or postponement thereof, and on every action or approval by written consent of the stockholders of the Company or the Board with respect to the election of members of the Board.
5.1.4 If a vacancy occurs because of the death, disability, disqualification, resignation, resignation or removal of a Sponsor Director or for any other reason, the Sponsor shall be entitled to designate such person’s successor, and the Company will, as promptly as practicable following such designation, use its best efforts to take all necessary and desirable actions, to the fullest extent permitted by law, within its control such that such vacancy shall be filled with such successor Nominee.
5.1.5 If a Nominee is not elected because of such Nominee’s death, disability, disqualification, withdrawal as a nominee or for any other reason, the Sponsor shall be entitled to designate promptly another Nominee and the Company will take all necessary and desirable actions within its control such that the director position for which such Nominee was nominated shall not be filled pending such designation or the size of the Board shall be increased by one and such vacancy shall be filled with such successor Nominee as promptly as practicable following such designation.
5.1.6 As promptly as reasonably practicable following the request of any Sponsor Director, the Company shall enter into an indemnification agreement with such Sponsor Director, in the form entered into with the other members of the Board. The Company shall pay the reasonable, documented out-of-pocket expenses incurred by the Sponsor Director in connection with his or her services provided to or on behalf of the Company, including attending meetings or events attended explicitly on behalf of the Company at the Company’s request.
5.1.7 The Company shall (i) purchase directors’ and officers’ liability insurance in an amount determined by the Board to be reasonable and customary and (ii) for so long as a Sponsor Director serves as a director of the Company, maintain such coverage with respect to such Sponsor Director; provided that upon removal or resignation of such Sponsor Director for any reason, the Company shall take all actions reasonably necessary to extend such directors’ and officers’ liability insurance coverage for a period of not less than six years from any such event in respect of any act or omission occurring at or prior to such event.
5.1.8 For so long as a Sponsor Director serves as a director of the Company, the Company shall not amend, alter or repeal any right to indemnification or exculpation covering or benefiting any director nominated pursuant to this Agreement as and to the extent consistent with applicable law, whether such right is contained in the Company’s certificate of incorporation or bylaws, each as amended, or another document (except to the extent such amendment or alteration permits the Company to provide broader indemnification or exculpation rights on a retroactive basis than permitted prior thereto).
5.1.9 Each Nominee may, but does not need to qualify as “independent” pursuant to listing standards of the New York Stock Exchange Nasdaq Global Market (or such other national securities exchange upon which the Company’s securities are then listed).
5.1.10 Any Nominee will be subject to the Company’s customary due diligence process, including its review of a completed questionnaire and a background check. Based on the foregoing, the Company may object to any Nominee provided (a) it does so in good faith, and (b) such objection is based upon any of the following: (i) such Nominee was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses), (ii) such Nominee was the subject of any order, judgment, judgment or decree not subsequently reversed, suspended or vacated of any court of competent jurisdiction, permanently or temporarily enjoining such proposed director from, or otherwise limiting, the following activities: (A) engaging in any type of business practice, or (B) engaging in any activity in connection with the purchase or sale of any security or in connection with any violation of federal or state securities laws, (iii) such Nominee was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described in clause (ii)(B), or to be associated with persons engaged in such activity, (iv) such proposed director was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any federal or state securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended or vacated, or (v) such proposed director was the subject of, or a party to any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to a violation of any federal or state securities laws or regulations. In the event the Board reasonably finds the Nominee to be unsuitable based upon one or more of the foregoing clauses (i) through (v) and reasonably objects to the identified director, Sponsor shall be entitled to propose a different nominee to the Board within 30 calendar days of the Company’s notice to Sponsor of its objection to the Nominee and such replacement Nominee shall be subject to the review process outlined above.
5.1.11 The Company shall take all necessary action to cause a Nominee chosen by the Sponsor, at the request of such Nominee to be elected to the board of directors (or similar governing body) of each material operating subsidiary of the Company. The Nominee, as applicable, shall have the right to attend (in person or remotely) any meetings of the board of directors (or similar governing body or committee thereof) of each subsidiary of the Company.
Appears in 2 contracts
Samples: Registration and Stockholder Rights Agreement (Arena Fortify Acquisition Corp.), Registration and Stockholder Rights Agreement (Arena Fortify Acquisition Corp.)
Director Nomination Rights. Subject (a) Each of the Subscriber, Xxxxxxxx Kargieman (“Kargieman”) (subject to the terms and conditions of this Agreementclause (i) below), at any time and CFAC Holdings V, LLC (“Cantor”, and collectively with the Subscriber and Kargieman, the “Voting Parties” and each, individually, a “Voting Party”) agrees to vote, or cause to be voted, all shares of the Issuer owned by such Voting Party, or over which such Voting Party has voting control (including causing its affiliates to vote), from time to time on and at all times such obligations remain in effect in accordance with the terms hereof, in whatever manner as shall be necessary to ensure that at each annual or special meeting of shareholders of the Issuer at which an election of directors is held, the following persons shall be elected to the Board (subject to any such nominee or the party entitled to nominate such person waiving such obligation in writing):
(i) Subject to Paragraph 3 below and to the occurrence of the Closing and the Transaction Closing, from and after the date Closing and the Transaction Closing, two (2) persons designated by the Subscriber, one such person being Secretary Xxxxxx Xxxxxx Mnuchin (“Secretary Mnuchin”), and a second designee who shall be reasonably acceptable to the Issuer (the “Subscriber Directors”). Any Subscriber Director who is an employee of the Manager or any of its affiliates and holds a title of managing director or senior managing director shall be deemed “reasonable” for purposes of this Paragraph 2(a)(i). The Subscriber Directors shall initially consist of (I) Secretary Mnuchin as the non-executive Chairman of the Board, and (II) a person to be designated by the Subscriber prior to the Closing (the “Initial Subscriber Directors”), and the Issuer shall take all necessary action to cause the appointment of the Initial Subscriber Directors to the Board as “Class I” directors, which term expires in 2025, in accordance with the Issuer’s governing documents at the Closing, subject to the occurrence of the Closing and the Transaction Closing. For so long as Secretary Mnuchin is a Subscriber Director, he shall be the non-executive Chairman of the Board and Kargieman and Cantor shall not be required to vote for any person designated by Liberty to replace Secretary Mnuchin unless such party consents in writing to such replacement, such consent not to be unreasonably withheld. By signing below, Kargieman agrees to cause any transferee of any Class B ordinary shares, par value $0.0001 per share, of the Issuer (“Class B Shares”) held by him to agree, as a condition to such Transfer, to all of the obligations of Kargieman under this letter agreement (other than in the case of a Transfer of Class B Shares to a transferee that would result in automatic conversion of such Class B Shares into Class A Shares in accordance with the Company consummates terms of the memorandum and articles of association of the Issuer).
(ii) Two (2) persons designated by Kargieman, one such person being Kargieman, and a Business Combination second designee who shall be reasonably acceptable to each of the Subscriber and Cantor (the “EK Directors”), which shall initially include Kargieman and Xxxxxx Xxxxxxxx, for so long as Kargieman and his affiliates continue to own beneficially an aggregate of at least one-third (1/3) of the Sponsor holds number of shares of the Issuer that Kargieman will own on the date of the Transaction Closing (subject to appropriate adjustment for any Registrable Securities:stock splits, stock dividends, combinations, recapitalizations and the like). Kargieman shall not designate another person to replace him without the written consent of Subscriber and Cantor which, consent, if Kargieman is no longer Chief Executive Officer of the Company, shall not be unreasonably withheld.
5.1.1 The Sponsor (iii) Xxxxxx Xxxxxxx (the “Cantor Director”), for so long as Cantor and its affiliates continue to own beneficially an aggregate of at least one-third (1/3) of the number of shares of the Issuer that Cantor will own on the date of the Closing (subject to appropriate adjustment for any stock splits, stock dividends, combinations, recapitalizations and the like).
(b) Subject to applicable law, the Issuer shall have the right, but not the obligation, take all necessary action to designate three individuals cause such directors as set forth in Paragraph 2(a) to be appointed elected to the Board. The Subscriber, Kargieman and Cantor shall each promptly cooperate with the Issuer’s taking of such actions, including, without limitation, by timely providing all information reasonably requested by the Issuer with respect to each Subscriber Director, each EK Director and the Cantor Director. In addition to the directors elected pursuant to Paragraph 2(a), the Board shall also initially include Xxx Xxxx, Xxxx Xxxxxxxxx, and another person designated by Kargieman who shall be reasonably acceptable to Subscriber, whose appointment shall be in compliance with NASDAQ listing requirements.
(c) Until the occurrence of a Cessation Event, in the event that the Subscriber or nominatedKargieman has not nominated the total number of Subscriber Directors or EK Directors, as the case may be, for election to the Board (including any successor, each, a “Nominee”) by giving written notice to the Company on Subscriber or before the time such information is reasonably requested by the Board or the Nominating Committee of the BoardKargieman, as applicable, for inclusion shall be entitled to nominate pursuant to Paragraph 2(a)(i) or (ii) above, respectively, in a proxy statement for a meeting accordance with the memorandum and articles of stockholders provided association of the Issuer such additional Subscriber Directors or EK Directors to which it is entitled in accordance with Paragraph 2(a)(i) or (ii), in which case, the Sponsor.
5.1.2 The Company will, as promptly as practicable, use its best efforts to Issuer and the Board shall take all necessary and desirable actions (including, without limitation, calling special meetings of the Board and the stockholders and recommending, supporting and soliciting proxies) so that there are three Sponsor Directors serving on the Board at all times.
5.1.3 The Company shallcorporation action, to the fullest extent permitted by applicable law, use to (i) enable the Subscriber or Kargieman, as applicable, to nominate and effect the nomination and election of such additional Subscriber Director(s) or EK Director(s), as the case may be, whether by increasing the size of the Board or otherwise, and (ii) to designate such additional Subscriber Director(s) or EK Director(s), as the case may be, to fill such newly created vacancies or to fill any other existing vacancies.
(d) From and after the Closing and the Transaction Closing until the occurrence of a Cessation Event, the Subscriber shall have the right to nominate one Subscriber Director to serve on each committee of the Board, provided that any such nominee shall be a director and shall be eligible to serve on the applicable committee under applicable law or listing standards of the Nasdaq or New York Stock Exchange (as applicable), including any applicable independence requirements (subject in each case to any applicable exceptions, including those for newly public companies and for “controlled companies,” and any applicable phase-in periods). Any additional members shall be determined by the Board. Each Subscriber Director nominated and appointed to serve on a Board committee pursuant to this Paragraph 2(c) shall have the right to remain on such committee so long as the Subscriber is entitled to nominate such director to the Board and such Subscriber Director is entitled to be a director of the Issuer under Paragraph 3(b) below. Unless the Subscriber notifies the Issuer otherwise prior to the time the Board takes action to change the composition of a Board committee, and if a Cessation Event has not yet occurred at the time the Board takes action to change the composition of any such Board committee, any Subscriber Director currently designated by the Subscriber to serve on a committee shall be presumed to be re-nominated to such Board committee.
(e) In the event that any Subscriber Director or EK Director shall cease to serve as a Subscriber Director or EK Director, respectively, for any reason, the Subscriber or Kargieman, as the case may be, shall be entitled to nominate such person’s successor in accordance with this letter agreement and the Board shall promptly fill the vacancy with such successor nominee; it being understood that any such nominee shall be entitled to continue to so serve as a director so long as the Subscriber is entitled to nominate Subscriber Directors or Kargieman is entitled to nominate EK Directors, as the case may be, to the Board and such Subscriber Director or EK Director, respectively, was entitled to be a director of the Issuer under Paragraph 3(b) below (in the case of a Subscriber Director) or Paragraph 2(a)(ii) (in the case of an EK Director).
(f) If a Subscriber Director or EK Director is not appointed or elected to the Board because of such person’s death, disability, disqualification, withdrawal as a nominee or is unavailable or unable to serve on the Board for any other reason, the Subscriber or Kargieman, as applicable, shall be entitled to nominate promptly another Subscriber Director or EK Director, respectively, and the director position for which the original Subscriber Director or EK Director was nominated shall not be filled pending such nomination.
(g) So long as the Subscriber has the right to nominate Subscriber Directors pursuant to this letter agreement or any Subscriber Director is serving on the Board, the Issuer shall maintain in effect at all times directors and officers indemnity insurance coverage reasonably satisfactory to the Subscriber, and the Issuer’s governing documents (as may be further amended, supplemented or waived in accordance with its best efforts terms) shall at all times provide for indemnification, exculpation and advancement of expenses to the fullest extent permitted under applicable law.
(h) At any time that the Subscriber has the right nominate Subscriber Directors to the Board pursuant to this letter agreement, the Issuer shall not increase or decrease the maximum number of directors permitted to serve on the Board without the prior written consent of the Subscriber.
(i) At any time that the Subscriber has the right to nominate Subscriber Directors pursuant to this letter agreement, the Issuer shall not take all actions necessary any action, including making or recommending any amendment to ensure that: the Issuer’s governing documents that could reasonably be expected to adversely affect the Subscriber’s rights under this letter agreement and. Subscriber hereby consents to the amendments to the memorandum and articles of association of the Issuer reflected in Annex A attached hereto.
(j) The Issuer agrees that prior to the occurrence of a Cessation Event, (i) each Nominee is Subscriber Director will be included in the Board’s slate of nominees to the stockholders of Issuer’s shareholders (the Company “Board’s Slate”) for each election of directors; a class of directors to which the relevant Subscriber Director belongs, and (ii) each Nominee is such Subscriber Director will be included in the proxy statement prepared by management of the Company Issuer in connection with soliciting proxies for every meeting of the stockholders shareholders of the Company Issuer called with respect to the election of members of the BoardBoard of the class of directors to which the relevant Subscriber Director belongs (each, a “Director Election Proxy Statement”), and at every adjournment or postponement thereof, and on every action or approval by written consent of the stockholders shareholders of the Company Issuer or the Board with respect to the election of members of the BoardBoard of the class of directors to which the relevant Subscriber Director belongs. The Issuer agrees to provide written notice of the commencement the preparation of a Director Election Proxy Statement to the Subscriber at least 20 business days, but no more than 60 business days, prior to the earlier of the mailing and the filing date of any Director Election Proxy Statement. The Subscriber shall be deemed to re-nominate the incumbent Subscriber Directors unless, subject to Paragraph 2(a) above, Subscriber notifies Issuer in writing as to the nomination of replacement Subscriber Director(s) at least 90 days prior to the date of such shareholders meeting.
5.1.4 If a vacancy occurs because of the death, disability, disqualification, resignation, or removal of a Sponsor Director or for any other reason, the Sponsor shall be entitled to designate such person’s successor, and the Company will, as promptly as practicable following such designation, use its best efforts to take all necessary and desirable actions, to the fullest extent permitted by law, within its control such that such vacancy shall be filled with such successor Nominee.
5.1.5 If a Nominee is not elected because of such Nominee’s death, disability, disqualification, withdrawal as a nominee or for any other reason, the Sponsor shall be entitled to designate promptly another Nominee and the Company will take all necessary and desirable actions within its control such that the director position for which such Nominee was nominated shall not be filled pending such designation or the size of the Board shall be increased by one and such vacancy shall be filled with such successor Nominee as promptly as practicable following such designation.
5.1.6 As promptly as reasonably practicable following the request of any Sponsor Director, the Company shall enter into an indemnification agreement with such Sponsor Director, in the form entered into with the other members of the Board. (k) The Company Issuer shall pay the reasonable, documented all reasonable out-of-pocket expenses incurred by any Subscriber Director in connection with the Sponsor Director performance of his or her duties as a director and in connection with his or her services provided to or on behalf attendance at any meeting of the Company, including attending meetings or events attended explicitly on behalf of the Company at the Company’s requestBoard.
5.1.7 The Company shall (i) purchase directors’ and officers’ liability insurance in an amount determined by the Board to be reasonable and customary and (ii) for so long as a Sponsor Director serves as a director of the Company, maintain such coverage with respect to such Sponsor Director; provided that upon removal or resignation of such Sponsor Director for any reason, the Company shall take all actions reasonably necessary to extend such directors’ and officers’ liability insurance coverage for a period of not less than six years from any such event in respect of any act or omission occurring at or prior to such event.
5.1.8 For so long as a Sponsor Director serves as a director of the Company, the Company shall not amend, alter or repeal any right to indemnification or exculpation covering or benefiting any director nominated pursuant to this Agreement as and to the extent consistent with applicable law, whether such right is contained in the Company’s certificate of incorporation or bylaws, each as amended, or another document (except to the extent such amendment or alteration permits the Company to provide broader indemnification or exculpation rights on a retroactive basis than permitted prior thereto).
5.1.9 Each Nominee may, but does not need to qualify as “independent” pursuant to listing standards of the New York Stock Exchange (or such other national securities exchange upon which the Company’s securities are then listed).
5.1.10 Any Nominee will be subject to the Company’s customary due diligence process, including its review of a completed questionnaire and a background check. Based on the foregoing, the Company may object to any Nominee provided (a) it does so in good faith, and (b) such objection is based upon any of the following: (i) such Nominee was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses), (ii) such Nominee was the subject of any order, judgment, or decree not subsequently reversed, suspended or vacated of any court of competent jurisdiction, permanently or temporarily enjoining such proposed director from, or otherwise limiting, the following activities: (A) engaging in any type of business practice, or (B) engaging in any activity in connection with the purchase or sale of any security or in connection with any violation of federal or state securities laws, (iii) such Nominee was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described in clause (ii)(B), or to be associated with persons engaged in such activity, (iv) such proposed director was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any federal or state securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended or vacated, or (v) such proposed director was the subject of, or a party to any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to a violation of any federal or state securities laws or regulations. In the event the Board reasonably finds the Nominee to be unsuitable based upon one or more of the foregoing clauses (i) through (v) and reasonably objects to the identified director, Sponsor shall be entitled to propose a different nominee to the Board within 30 calendar days of the Company’s notice to Sponsor of its objection to the Nominee and such replacement Nominee shall be subject to the review process outlined above.
5.1.11 The Company shall take all necessary action to cause a Nominee chosen by the Sponsor, at the request of such Nominee to be elected to the board of directors (or similar governing body) of each material operating subsidiary of the Company. The Nominee, as applicable, shall have the right to attend (in person or remotely) any meetings of the board of directors (or similar governing body or committee thereof) of each subsidiary of the Company.
Appears in 2 contracts
Samples: Subscription Agreement (Satellogic Inc.), Subscription Agreement (Satellogic Inc.)
Director Nomination Rights. Subject (a) No Principal Stockholder shall designate any Principal Stockholder Designee who it believes does not satisfy the requirements for service on the Company Board set forth in Section 2.9(A)(2)(d) (other than with respect to clause (ii)(B) of such Section) of the Bylaws or the rules and regulations of Nasdaq or applicable Law. Upon the identification of any Principal Stockholder Designee by a Principal Stockholder, the Company Board (or a committee thereof) shall promptly and in good faith consider each Principal Stockholder Designee. In the event that the Company Board (or a committee thereof) determines that the Principal Stockholder Designee fails to meet such requirements, such Principal Stockholder Designee shall not be nominated for election to the terms Company Board, and conditions of this Agreement, at any time the applicable Principal Stockholder(s) shall have the right to designate an alternative applicable Principal Stockholder Designee for consideration. Upon their nomination to the Company Board and from time to time on or after the date that the Company consummates a Business Combination and for so long as the Sponsor holds any Registrable Securities:
5.1.1 The Sponsor shall have the right, but not the obligation, to designate three individuals to be appointed or nominated, as the case may be, for election to the Board (including any successor, each, a “Nominee”) by giving written notice to the Company on or before the time such information is thereafter if reasonably requested by any Principal Stockholder, the Company Board (or the Nominating Committee of the Board, a committee thereof) shall in good faith consider whether any Principal Stockholder Designee qualifies as applicable, for inclusion in a proxy statement for a meeting of stockholders provided to the SponsorCompany Independent Director.
5.1.2 The Company will, as promptly as practicable, use its best efforts to take all necessary and desirable actions (including, without limitation, calling special meetings of the Board and the stockholders and recommending, supporting and soliciting proxiesb) so that there are three Sponsor Directors serving on the Board at all times.
5.1.3 The Company shall, to the fullest extent permitted by applicable law, use its best efforts to take all actions necessary to ensure that: (i) each Nominee is included in the Board’s slate of nominees to the stockholders of the Company for each election of directors; and (ii) each Nominee is included in the proxy statement prepared by management of the Company in In connection with soliciting proxies for every any annual or special meeting of the stockholders of the Company called with respect at which directors shall be elected (or any action by stockholder consent to elect directors in lieu of a stockholder meeting), but subject to the election allocation of members designees among the classes of the Board, and at every adjournment directors pursuant to Section 3.1 for any annual or postponement thereof, and on every action or approval by written consent special meeting of the stockholders of the Company at which directors shall be elected (or the Board with respect any action by stockholder consent to the election of members of the Board.
5.1.4 If a vacancy occurs because of the death, disability, disqualification, resignation, or removal elect directors in lieu of a Sponsor Director or for any other reason, stockholder meeting) occurring on and after the Sponsor shall be entitled to designate such person’s successor, and the Company will, as promptly as practicable following such designation, use its best efforts to take all necessary and desirable actions, to the fullest extent permitted by law, within its control such that such vacancy shall be filled with such successor Nominee.
5.1.5 If a Nominee is not elected because of such Nominee’s death, disability, disqualification, withdrawal as a nominee or for any other reason, the Sponsor shall be entitled to designate promptly another Nominee and the Company will take all necessary and desirable actions within its control such that the director position for which such Nominee was nominated shall not be filled pending such designation or the size of the Board shall be increased by one and such vacancy shall be filled with such successor Nominee as promptly as practicable following such designation.
5.1.6 As promptly as reasonably practicable following the request of any Sponsor DirectorTrigger Date, the Company shall enter into an indemnification agreement with such Sponsor Director, in the form entered into with the other members of the Board. The Company shall pay the reasonable, documented out-of-pocket expenses incurred by the Sponsor Director in connection with his or her services provided to or on behalf of the Company, including attending meetings or events attended explicitly on behalf of the Company at the Company’s request.
5.1.7 The Company shall (i) purchase directors’ and officers’ liability insurance in an amount determined by the Board to be reasonable and customary and (ii) for so long as a Sponsor Director serves as a director of the Company, maintain such coverage with respect to such Sponsor Director; provided that upon removal or resignation of such Sponsor Director for any reason, the Company shall take all actions reasonably necessary to extend such directors’ and officers’ liability insurance coverage for a period of not less than six years from any such event in respect of any act or omission occurring at or prior to such event.
5.1.8 For so long as a Sponsor Director serves as a director of the Company, the Company shall not amend, alter or repeal any right to indemnification or exculpation covering or benefiting any director nominated pursuant to this Agreement as and to the extent consistent with applicable law, whether such right is contained in the Company’s certificate of incorporation or bylaws, each as amended, or another document (except to the extent such amendment or alteration permits the Company to provide broader indemnification or exculpation rights on a retroactive basis than permitted prior thereto).
5.1.9 Each Nominee may, but does not need to qualify as “independent” pursuant to listing standards of the New York Stock Exchange (or such other national securities exchange upon which the Company’s securities are then listed).
5.1.10 Any Nominee will be subject to the Company’s customary due diligence process, including its review of a completed questionnaire and a background check. Based on the foregoing, the Company may object to any Nominee provided (acommittee thereof) it does so in good faith, and (b) such objection is based upon any of the following: (i) such Nominee was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses), (ii) such Nominee was the subject of any order, judgment, or decree not subsequently reversed, suspended or vacated of any court of competent jurisdiction, permanently or temporarily enjoining such proposed director from, or otherwise limiting, the following activities: (A) engaging in any type of business practice, or (B) engaging in any activity in connection with the purchase or sale of any security or in connection with any violation of federal or state securities laws, (iii) such Nominee was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described in clause (ii)(B), or to be associated with persons engaged in such activity, (iv) such proposed director was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any federal or state securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended or vacated, or (v) such proposed director was the subject of, or a party to any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to a violation of any federal or state securities laws or regulations. In the event the Board reasonably finds the Nominee to be unsuitable based upon one or more of the foregoing clauses (i) through (v) and reasonably objects to the identified director, Sponsor shall be entitled to propose a different nominee to the Board within 30 calendar days of the Company’s notice to Sponsor of its objection to the Nominee and such replacement Nominee shall be subject to the review process outlined above.
5.1.11 The Company shall take all necessary action to cause a Nominee chosen by the Sponsor, at the request of such Nominee to be elected to the board of directors (or similar governing body) of each material operating subsidiary of the Company. The Nominee, as applicable, shall have the right to attend (in person or remotely) any meetings designate persons as nominees of the board Company Board for election to each directorship for which a Principal Stockholder is not entitled to designate a Principal Stockholder Designee (each such designee, a “Non-Principal Stockholder Designee”).
(c) The Company shall cause each Principal Stockholder Designee and Non-Principal Stockholder Designee to be included in the Company’s proxy materials and form of proxy disseminated to stockholders in connection with the election of directors (or similar governing body or committee thereofincluding at any special meeting of stockholders held for the election of directors), and the Company Board (subject to its fiduciary duties) shall recommend such designees for election by the holders of Company Common Stock. Subject to the fiduciary duties of the Company Board, the Company shall use its reasonable best efforts to cause the election of each subsidiary such Principal Stockholder Designee and Non- Principal Stockholder Designee, including soliciting proxies in favor of the election of such persons.
(d) From and after the date hereof, any vacancy on the Company Board that results from an increase in the number of directors or from the death, resignation, retirement, disqualification or removal of any director from office or from any other cause shall, unless otherwise required by law, be filled (A) prior to the Trigger Date, by the affirmative vote of a majority of the total number of directors then in office, even if less than a quorum, or by a sole remaining director, or by the affirmative vote of the holders of a majority of the voting power of the outstanding shares of Company Common Stock entitled to vote generally for the election of directors, voting as a single class and acting at a meeting of stockholders or by written consent in accordance with the Delaware General Corporation Law, the Charter and the Bylaws, and (B) on or after the Trigger Date, solely by the vote of a majority of the total number of directors then in office, even if less than a quorum, or by a sole remaining director, and shall not be filled by the stockholders.
(e) So long as the Principal Stockholder Group owns at least a majority of the outstanding shares of Company Common Stock and the Company is otherwise eligible to avail itself of any available “controlled company” exceptions to the corporate governance listing standards of Nasdaq, the Company may avail itself of any such exceptions, and, thereafter, the Company shall comply with the corporate governance listing standards of Nasdaq, including those relating to the composition of the committees of the Company Board.
(f) For the avoidance of doubt, each Principal Stockholder shall have the right, in its sole discretion, to waive any and all of the rights granted to it under this Section 3.2, by delivery of written notice to the Company.
Appears in 2 contracts
Samples: Stockholders Agreement (ProFrac Holding Corp.), Stockholders Agreement (ProFrac Holding Corp.)
Director Nomination Rights. Subject to (a) On the terms Closing Date, the Board shall appoint Shareholder and conditions of this Agreement, at any time and from time to time on or after the date that the Company consummates a Business Combination and for so long as the Sponsor holds any Registrable Securities:
5.1.1 The Sponsor shall have the right, but not the obligation, to designate three individuals to be appointed or nominated, as the case may be, for election one Independent candidate designated by Shareholder to the Board (including any successorprovided, each, a “Nominee”) that if such Independent candidate has not been designated by giving written notice Shareholder on or prior to the Company on or before the time such information is reasonably requested by Closing Date, the Board or shall appoint to the Nominating Committee of Board such Independent candidate when subsequently so designated by Shareholder). The parties hereto acknowledge and agree that the Board, as applicable, for inclusion in a proxy statement Shareholder shall be appointed to the Board to serve for a term expiring at Buyer's 2007 annual meeting of stockholders provided term and such Independent candidate shall be appointed to the Sponsor.
5.1.2 The Company willBoard to serve for a term expiring at Buyer's 2006 annual meeting in order to comply with the requirements for staggered terms and apportioned classes of Directors set forth in Buyer's By-laws. Notwithstanding the foregoing, as promptly as practicablethe appointment of Shareholder or any Shareholder-designated candidate pursuant to this Section 2(a), use its best efforts to take all necessary and desirable actions (including, without limitation, calling special meetings of the Board and the stockholders and recommending, supporting and soliciting proxies) so that there are three Sponsor Directors serving on the Board at all times.
5.1.3 The Company shall, to the fullest extent permitted by applicable law, use its best efforts to take all actions necessary to ensure that: (i) each Nominee is included in the Board’s slate of nominees shall be subject to the stockholders approval process of the Company for each election of directors; Buyer's Nominating & Governance Committee, consistent with Buyer's Corporate Governance Guidelines, and (ii) each Nominee is included must have the requisite qualifications as determined in good faith by the proxy statement prepared by management of Nominating & Governance Committee; provided, however, that if for any reason the Company conditions set forth in connection clauses (i) and (ii) are not satisfied, Shareholder shall have the right to designate an alternate person or persons to be so nominated. Nothing in this Section 2 shall prevent the Board from acting in good faith in accordance with soliciting proxies for every meeting of the stockholders of the Company called with respect its Corporate Governance Guidelines while giving due consideration to the election intent of members of this Agreement.
(b) After the BoardClosing Date, and at every adjournment should there exist or postponement thereof, and occur any vacancy on every action or approval by written consent of the stockholders of the Company or the Board with respect to the as a result of death, disability, retirement, resignation, removal or any other reason, including if any current Director shall not be nominated for re-election of members of the Board.
5.1.4 If a (other than any vacancy occurs because of resulting from the death, disability, disqualificationretirement, resignation, resignation or removal of a Sponsor Director Shareholder or for any other reasonShareholder Director), the Sponsor shall be entitled to designate such person’s successor, and the Company will, as promptly as practicable following such designation, use its best efforts to take all necessary and desirable actions, to the fullest extent permitted by law, within its control such that such vacancy shall be filled with such successor Nominee.
5.1.5 If a Nominee is not elected because of such Nominee’s death, disability, disqualification, withdrawal as a nominee or for any other reason, the Sponsor shall be entitled to designate promptly another Nominee and the Company will take all necessary and desirable actions within its control such that the director position for which such Nominee was nominated shall not be filled pending such designation or the size of the Board shall appoint one additional Independent candidate designated by Shareholder to the Board to serve for a term of office continuing only until the next election of the class of Directors in which the vacancy occurs. The parties hereto acknowledge and agree that such Independent candidate shall be increased nominated to the same class as the Director that such Independent candidate is replacing. Notwithstanding the foregoing, the appointment of a Shareholder-designated candidate pursuant to this Section 2(b), (i) shall be subject to the approval process of Buyer's Nominating & Governance Committee, consistent with Buyer's Corporate Governance Guidelines, and (ii) must have the requisite qualifications as determined in good faith by one the Nominating & Governance Committee; provided, however, that if for any reason the conditions set forth in clauses (i) and (ii) are not satisfied, Shareholder shall have the right to designate an alternate person or persons to be so nominated. Nothing in this Section 2 shall prevent the Board from acting in good faith in accordance with its Corporate Governance Guidelines while giving due consideration to the intent of this Agreement.
(c) Following the initial appointments referenced in Sections 2(a) and (b) above, Buyer shall nominate for the Board at the next applicable annual meeting of the shareholders of Buyer, any Independent candidates designated by Shareholder pursuant to the terms of this Agreement (each such designated Independent candidate a "SHAREHOLDER DIRECTOR" and collectively, the "SHAREHOLDER DIRECTORS"); provided, however, that Buyer shall only be obligated to nominate any Shareholder Director at the annual meeting at which the term of the class of Directors to which any Shareholder Director belongs has expired and such vacancy class of Directors is up for election. In accordance with its Corporate Governance Guidelines, the Board shall be filled with such successor Nominee as promptly as practicable following such designation.
5.1.6 As promptly as reasonably practicable following submit in writing the request name of any Sponsor Director, Shareholder Director to the Company shall enter into an indemnification agreement with such Sponsor Director, in the form entered into with the other members of Buyer Nominating & Governance Committee for election to the Board. The Company shall pay the reasonable, documented out-of-pocket expenses incurred by the Sponsor Director in connection with his or her services provided to or on behalf of the Company, including attending meetings or events attended explicitly on behalf of the Company at the Company’s request.
5.1.7 The Company shall use its reasonable best efforts (i) purchase directors’ and officers’ liability insurance in an amount determined by to cause the Buyer Nominating & Governance Committee to include the name of the Shareholder Directors so submitted among its nominees for election to the Board to be reasonable and customary and (ii) for so long as a Sponsor Director serves as a director to cause the Board to unanimously recommend that the shareholders of Buyer vote in favor of the CompanyShareholder Directors; provided, maintain such coverage with respect to such Sponsor Director; provided however, that upon removal or resignation of such Sponsor Director if for any reason, reason the Company shall take all actions reasonably necessary to extend such directors’ and officers’ liability insurance coverage for a period of not less than six years from any such event conditions set forth in respect of any act or omission occurring at or prior to such event.
5.1.8 For so long as a Sponsor Director serves as a director of the Company, the Company shall not amend, alter or repeal any right to indemnification or exculpation covering or benefiting any director nominated pursuant to this Agreement as and to the extent consistent with applicable law, whether such right is contained in the Company’s certificate of incorporation or bylaws, each as amended, or another document (except to the extent such amendment or alteration permits the Company to provide broader indemnification or exculpation rights on a retroactive basis than permitted prior thereto).
5.1.9 Each Nominee may, but does not need to qualify as “independent” pursuant to listing standards of the New York Stock Exchange (or such other national securities exchange upon which the Company’s securities are then listed).
5.1.10 Any Nominee will be subject to the Company’s customary due diligence process, including its review of a completed questionnaire and a background check. Based on the foregoing, the Company may object to any Nominee provided (a) it does so in good faith, and (b) such objection is based upon any of the following: (i) such Nominee was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses), (ii) such Nominee was the subject of any order, judgment, or decree not subsequently reversed, suspended or vacated of any court of competent jurisdiction, permanently or temporarily enjoining such proposed director from, or otherwise limiting, the following activities: (A) engaging in any type of business practice, or (B) engaging in any activity in connection with the purchase or sale of any security or in connection with any violation of federal or state securities laws, (iii) such Nominee was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described in clause (ii)(B), or to be associated with persons engaged in such activity, (iv) such proposed director was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any federal or state securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended or vacated, or (v) such proposed director was the subject of, or a party to any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to a violation of any federal or state securities laws or regulations. In the event the Board reasonably finds the Nominee to be unsuitable based upon one or more of the foregoing clauses (i) through and (vii) and reasonably objects to the identified directorare not satisfied, Sponsor shall be entitled to propose a different nominee to the Board within 30 calendar days of the Company’s notice to Sponsor of its objection to the Nominee and such replacement Nominee shall be subject to the review process outlined above.
5.1.11 The Company shall take all necessary action to cause a Nominee chosen by the Sponsor, at the request of such Nominee to be elected to the board of directors (or similar governing body) of each material operating subsidiary of the Company. The Nominee, as applicable, Shareholder shall have the right to attend (in designate an alternate person or remotelypersons to be so nominated. Nothing in this Section 2 shall prevent the Board from acting in good faith in accordance with its Corporate Governance Guidelines while giving due consideration to the intent of this Agreement.
(d) any meetings Following the initial appointment of Shareholder referenced in Section 2(a) above, Buyer shall nominate Shareholder at each applicable annual meeting of the board shareholders of directors (or similar governing body or committee thereof) of Buyer to serve on the Board; provided, however, the Buyer shall only be obligated to nominate the Shareholder at each subsidiary annual meeting at which the term of the Companyclass of Directors to which Shareholder belongs has expired and such class of Directors is up for election. In accordance with its Corporate Governance Guidelines, the Board shall submit in writing Shareholder's name to the Buyer Nominating & Governance Committee for election to the Board. The Company shall use its reasonable best efforts (i) to cause the Buyer Nominating & Governance Committee to include the Shareholder so submitted among its nominees for election to the Board and (ii) to cause the Board to unanimously recommend that the shareholders of Buyer to vote in favor of Shareholder. Nothing in this Section 2 shall prevent the Board from acting in good faith in accordance with its Corporate Governance Guidelines while giving due consideration to the intent of this Agreement.
(e) The Shareholder Directors (but not the Shareholder), will each be invited to serve on at least one committee of the Board while serving as Directors, in accordance with and subject to their respective qualifications. The parties hereto acknowledge and agree that so long as each applicable Shareholder Director (i) submits to the proper approval process with the Nominating & Governance Committee, consistent with Buyer's Corporate Governance Guidelines and (ii) has the requisite qualifications as determined in good faith by the Nominating & Governance Committee, one of the Shareholder Directors will be invited to serve on the Audit Committee of the Board while serving as a Director and one of the Shareholder Directors will be invited to serve on the Compensation Committee of the Board while serving as a Director.
(f) Subject to Sections 2(c), 2(g), 3, and 5, in the event any Shareholder Director dies, becomes disabled or resigns, retires or is removed from the Board, Shareholder shall have the right to designate a replacement director to fill such vacancy to serve for a term of office continuing only until the next election of the class of Directors in which the vacancy occurs and such replacement director shall be considered a "Shareholder Director" for purposes of this Agreement.
(i) The rights of Shareholder to designate any Shareholder Director, the right of any Shareholder Director to sit on the Board, and the obligations of the Board and Buyer pursuant to this Section 2 with respect to the Shareholder Directors shall terminate in the event that Shareholder both (A) ceases to Own 9% of the outstanding shares of Buyer common stock and (B) ceases to Own 9,000,000 shares of Buyer common stock.
(ii) All rights of Shareholder, including without limitation, the right of Shareholder to sit on the Board, and the obligations of the Board and Buyer pursuant to this Section 2, shall terminate in the event Shareholder ceases to Own 5,000,000 shares of Buyer common stock.
Appears in 1 contract
Samples: Nominating Agreement (Perrigo Co)
Director Nomination Rights. Subject to (a) Until the terms and conditions of this AgreementTrigger Date, at any time and from time to time on or after the date that the Company consummates a Business Combination and for so long as the Sponsor holds any Registrable Securities:
5.1.1 The Sponsor shall have the right, but not the obligation, to designate three individuals to be appointed or nominated, as the case may be, for election to the Board (including any successor, each, a “Nominee”) by giving written notice to the Company on or before the time such information is reasonably requested by the Board or the Nominating Committee of the Board, as applicable, for inclusion in a proxy statement for a meeting of stockholders provided to the Sponsor.
5.1.2 The Company will, as promptly as practicable, use its best efforts to take all necessary and desirable actions (including, without limitation, calling special meetings of the Board and the stockholders and recommending, supporting and soliciting proxies) so that there are three Sponsor Directors serving on the Board at all times.
5.1.3 The Company shall, to the fullest extent permitted by applicable law, use its best efforts to take all actions necessary to ensure that: (i) each Nominee is included in the Board’s slate of nominees to the stockholders of the Company for each election of directors; and (ii) each Nominee is included in the proxy statement prepared by management of the Company in connection with soliciting proxies for every any annual or special meeting of the stockholders of the Company called at which directors shall be elected, GE shall have the right to designate five (5) persons for nomination by the Company Board for election to the Company Board (each person so designated, a “GE Designee”). Until the Trigger Date, GE shall have full authority and ability to nominate, elect and remove the GE Designees in accordance with respect Section 3.2(c) in the case of the nomination or election of the GE Designees. GE shall not designate any person to be a GE Designee who it believes does not meet the requirements for director nominees as set forth in the applicable policies of the Company relating to director qualification from time to time. The Company Board shall promptly and in good faith consider each GE Designee designated pursuant to this Section 3.2(a), applying the same standards as shall be applied for the consideration of other proposed nominees of the Company Board. In the event that the Company Board fails to approve the nomination of any GE Designee, GE shall have the right to designate an alternative GE Designee for consideration. For the avoidance of doubt, current or former employment of any GE Designee by GE or any of its Subsidiaries or service by any such GE Designee on the board of directors of GE or any of its Subsidiaries shall not disqualify such individual from serving on the Company Board as a GE Designee.
(b) Notwithstanding Section 3.2(a), until the Trigger Date, if the size of the Company Board shall, with GE’s prior written approval or otherwise, be increased or decreased, GE shall have the right to designate one or more GE Designees to the Company Board such that the total number of GE Directors on the Company Board shall be proportional (rounded up to the nearest whole number) to the number of GE Directors on the Company Board set forth in Section 3.1(a).
(c) The Company shall cause each GE Designee and Non-GE Designee whose nomination has been approved to be included in the slate of nominees recommended by the Company Board to holders of Company Common Stock for election (including at any special meeting of stockholders held for the election of members of the Board, directors) and at every adjournment or postponement thereof, and on every action or approval by written consent of the stockholders of the Company or the Board with respect to the election of members of the Board.
5.1.4 If a vacancy occurs because of the death, disability, disqualification, resignation, or removal of a Sponsor Director or for any other reason, the Sponsor shall be entitled to designate such person’s successor, and the Company will, as promptly as practicable following such designation, use its best efforts to take all necessary cause the election of each such GE Designee and desirable actionsNon-GE Designee, to including soliciting proxies in favor of the fullest extent permitted by law, within its control election of such that such vacancy shall be filled with such successor Nomineepersons.
5.1.5 If a Nominee is not elected because of such Nominee’s death, disability, disqualification, withdrawal as a nominee or for any other reason, (d) Until the Sponsor shall be entitled to designate promptly another Nominee and the Company will take all necessary and desirable actions within its control such that the director position for which such Nominee was nominated shall not be filled pending such designation or the size of the Board shall be increased by one and such vacancy shall be filled with such successor Nominee as promptly as practicable following such designation.
5.1.6 As promptly as reasonably practicable following the request of any Sponsor Director, the Company shall enter into an indemnification agreement with such Sponsor DirectorTrigger Date, in the form entered into with the other members of the Board. The Company event that any GE Director shall pay the reasonable, documented out-of-pocket expenses incurred by the Sponsor Director in connection with his or her services provided cease to or on behalf of the Company, including attending meetings or events attended explicitly on behalf of the Company at the Company’s request.
5.1.7 The Company shall (i) purchase directors’ and officers’ liability insurance in an amount determined by the Board to be reasonable and customary and (ii) for so long as a Sponsor Director serves serve as a director of the Company, maintain such coverage with respect to such Sponsor Director; provided that upon removal or resignation of such Sponsor Director for any reason, the vacancy resulting therefrom shall be filled by the Company shall take all actions reasonably necessary to extend such directors’ Board with a substitute GE Director.
(e) From and officers’ liability insurance coverage for after the date hereof, in the event of a period of not less than six years vacancy on the Company Board upon the death, resignation, retirement, disqualification, removal from any such event in respect office or other cause of any act director who was not a GE Designee, the Governance & Nominating Committee shall have the sole right to fill such vacancy or omission occurring at or prior designate a person for nomination, reasonably acceptable to GE, for election to the Company Board to fill such eventvacancy (each such person, a “Non-GE Designee”).
5.1.8 For so long as a Sponsor Director serves as a director of (f) Until the CompanyTrigger Date, the Company shall not amend, alter or repeal any right to indemnification or exculpation covering or benefiting any director nominated pursuant to this Agreement as and avail itself of all available “controlled company” exceptions to the extent consistent with applicable law, whether such right is contained in the Company’s certificate of incorporation or bylaws, each as amended, or another document (except to the extent such amendment or alteration permits the Company to provide broader indemnification or exculpation rights on a retroactive basis than permitted prior thereto).
5.1.9 Each Nominee may, but does not need to qualify as “independent” pursuant to corporate governance listing standards of the New York Stock Exchange (or such other national securities exchange upon which the Company’s securities are then listed)NYSE.
5.1.10 Any Nominee will be subject to (g) For the Company’s customary due diligence processavoidance of doubt, including its review of a completed questionnaire and a background check. Based on the foregoing, the Company may object to any Nominee provided (a) it does so in good faith, and (b) such objection is based upon any of the following: (i) such Nominee was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses), (ii) such Nominee was the subject of any order, judgment, or decree not subsequently reversed, suspended or vacated of any court of competent jurisdiction, permanently or temporarily enjoining such proposed director from, or otherwise limiting, the following activities: (A) engaging in any type of business practice, or (B) engaging in any activity in connection with the purchase or sale of any security or in connection with any violation of federal or state securities laws, (iii) such Nominee was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described in clause (ii)(B), or to be associated with persons engaged in such activity, (iv) such proposed director was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any federal or state securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended or vacated, or (v) such proposed director was the subject of, or a party to any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to a violation of any federal or state securities laws or regulations. In the event the Board reasonably finds the Nominee to be unsuitable based upon one or more of the foregoing clauses (i) through (v) and reasonably objects to the identified director, Sponsor shall be entitled to propose a different nominee to the Board within 30 calendar days of the Company’s notice to Sponsor of its objection to the Nominee and such replacement Nominee shall be subject to the review process outlined above.
5.1.11 The Company shall take all necessary action to cause a Nominee chosen by the Sponsor, at the request of such Nominee to be elected to the board of directors (or similar governing body) of each material operating subsidiary of the Company. The Nominee, as applicable, GE shall have the right right, in its sole discretion, to attend (in person or remotely) waive any meetings and all of the board rights granted to it under this Section 3.2, by delivery of directors (or similar governing body or committee thereof) of each subsidiary of written notice to the CompanyCompany in accordance with Section 7.4.
Appears in 1 contract
Samples: Transaction Agreement and Plan of Merger (General Electric Co)
Director Nomination Rights. Subject to i. Upon the terms and conditions of this AgreementClosing, at any time and from time to time on or after the date that the Company consummates a Business Combination and for so long as the Sponsor holds any Registrable Securities:
5.1.1 The Sponsor shall have the right, but not the obligation, to designate three individuals to be appointed or nominated, as the case may be, for election to the Board (including any successor, each, a “Nominee”) by giving written notice to the Company on or before the time such information is reasonably requested by the Board or the Nominating Committee of the Board, as applicable, for inclusion in a proxy statement for a meeting of stockholders provided to the Sponsor.
5.1.2 The Company will, as promptly as practicable, use its best efforts to take all necessary and desirable actions (including, without limitation, calling special meetings of the Board and the stockholders and recommending, supporting and soliciting proxies) so that there are three Sponsor Directors serving on the Board at all times.
5.1.3 The Company shall, to the fullest extent permitted by applicable law, use its best efforts to take all actions necessary to ensure that: (i) each Nominee is included in the Board’s slate of nominees to the stockholders of the Company for each election of directors; and (ii) each Nominee is included in the proxy statement prepared by management of the Company in connection with soliciting proxies for every meeting of the stockholders of the Company called with respect to the election of members of the Board, and at every adjournment or postponement thereof, and on every action or approval by written consent of the stockholders of the Company or the Board with respect to the election of members of the Board.
5.1.4 If a vacancy occurs because of the death, disability, disqualification, resignation, or removal of a Sponsor Director or for any other reason, the Sponsor shall be entitled to designate such person’s successor, and the Company will, as promptly as practicable following such designation, use its best efforts to take all necessary and desirable actions, to the fullest extent permitted by law, within its control such that such vacancy shall be filled with such successor Nominee.
5.1.5 If a Nominee is not elected because of such Nominee’s death, disability, disqualification, withdrawal as a nominee or for any other reason, the Sponsor shall be entitled to designate promptly another Nominee and the Company will take all necessary and desirable actions within its control such that the director position for which such Nominee was nominated shall not be filled pending such designation or the size of the Board shall be increased comprised of:
(A) Ten (10) Directors, initially nominated by the DK Stockholder Group, which nominees shall include the Chief Executive Officer of the Company and at least five (5) of whom qualify as “independent” directors under NASDAQ listing rules;
(B) Two (2) Directors, initially nominated by SM (as defined below) at his sole discretion, which nominees shall include at least one (1) individual who qualifies as an “independent” director under NASDAQ listing rules; and
(C) One (1) Director, initially nominated by the DEAC Stockholder Group, and subject to approval by the DK Stockholder Group, such vacancy approval not to be unreasonably withheld, who shall qualify as an “independent” director under NASDAQ listing rules; provided, however, that any of Hxxxx X. Xxxxx, Jxxx Xxxxxxxx and Exx Xxxxx shall be filled with deemed approved by the DK Stockholder Group to the extent that such successor Nominee Person would otherwise qualify as promptly as practicable following such designationan “independent” director under NASDAQ listing rules.
5.1.6 ii. As promptly as reasonably practicable following the request of any Sponsor DirectorClosing, the Company shall enter into an indemnification agreement with such Sponsor each Director, in each on substantially the form same terms entered into with with, and based on the same customary and reasonable form provided to, the other members of the BoardDirectors. The Company shall pay the reasonable, documented out-of-pocket expenses incurred by the Sponsor a Director in connection with his or her services provided to or on behalf of the Company, including attending meetings or events attended explicitly on behalf of the Company at the Company’s request.
5.1.7 The Company shall (i) purchase directors’ and officers’ liability insurance request in an amount determined by the Board to be reasonable and customary and (ii) for so long his or her capacity as a Sponsor Director serves as a director of the Company, maintain such coverage with respect to such Sponsor Director; provided that upon removal or resignation of such Sponsor Director for any reason, the Company shall take all actions reasonably necessary to extend such directors’ and officers’ liability insurance coverage for a period of not less than six years from any such event in respect of any act or omission occurring at or prior to such event.
5.1.8 For so long as a Sponsor Director serves as a director of the Company, the . The Company shall not amend, alter or repeal any right to indemnification or exculpation covering or benefiting any director Director nominated pursuant to this Agreement Agreement, as and to the extent consistent with applicable law, whether such right is contained in the Company’s certificate of incorporation or bylaws, each as amended, or another document Organizational Documents (except to the extent such amendment or alteration permits the Company to provide broader indemnification or exculpation rights on a retroactive basis than permitted prior thereto).
5.1.9 iii. The Company shall (A) purchase directors’ and officers’ liability insurance in an amount determined by the Board to be reasonable and customary and (B) for so long as a Director nominated pursuant to this Section 2.01 serves as a Director of the Company, maintain such coverage with respect to such Director and shall use commercially reasonable efforts to extend such coverage for a period of not less than six years from any removal or resignation of such Director, in respect of any act or omission occurring at or prior to such event.
iv. Each Nominee mayDirector nominated pursuant to this Section 2.01(b) shall serve until the earlier of (A) his or her death, but disability, retirement, resignation or removal from the Board and (B) the first annual meeting of stockholders of the Company following the date of appointment of such Director.
v. In connection with the first annual meeting of stockholders of the Company following the date of this Agreement and for each annual meeting of stockholders thereafter, the person who served as the SBT Sellers’ Representative (as such term is defined in the BCA) as of the date of the BCA (“SM”) shall have the right to nominate one (1) Director to serve on the Board (which person does not need to qualify as an “independent” pursuant to director under NASDAQ listing standards of the New York Stock Exchange (or such other national securities exchange upon which the Company’s securities are then listed).
5.1.10 Any Nominee will be subject to the Company’s customary due diligence process, including its review of a completed questionnaire and a background check. Based on the foregoing, the Company may object to any Nominee provided (a) it does so in good faith, and (b) such objection is based upon any of the following: (i) such Nominee was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offensesrules), (ii) such Nominee was the subject of any order, judgment, or decree not subsequently reversed, suspended or vacated of any court of competent jurisdiction, permanently or temporarily enjoining such proposed director from, or otherwise limiting, the following activities: (A) engaging in any type of business practice, or (B) engaging in any activity in connection with the purchase or sale of any security or in connection with any violation of federal or state securities laws, (iii) such Nominee was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described in clause (ii)(B), or to be associated with persons engaged in such activity, (iv) such proposed director was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any federal or state securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended or vacated, or (v) such proposed director was the subject of, or a party to any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to a violation of any federal or state securities laws or regulations. In the event the Board reasonably finds the Nominee to be unsuitable based upon one or more of the foregoing clauses (i) through (v) and reasonably objects to the identified director, Sponsor shall be entitled to propose a different nominee to the Board within 30 calendar days of the Company’s notice to Sponsor of its objection to the Nominee and such replacement Nominee whose identity shall be subject to the review process outlined aboveBoard’s approval not to be unreasonably withheld, conditioned or delayed, so long as SM holds, together with his wholly-owned Affiliates and immediate family members (and any of their wholly-owned Affiliates) and any trust whose sole beneficiaries are SM and/or his immediate family members (together, the “SM Group”), at the time of such annual meeting at least nine percent (9%) of the issued and outstanding shares of Class A Common Stock in the aggregate.
5.1.11 The Company shall take all necessary action vi. If the term of a Director appointed by SM pursuant to cause a Nominee chosen by Section 2.01(b)(v) terminates due to his or her death, disability, retirement, resignation or removal from the SponsorBoard before the next annual meeting of the stockholders of the Company, then at the request of SM, and provided that SM holds, together with the SM Group, at such Nominee time at least nine percent (9%) of the issued and outstanding shares of Class A Common Stock in the aggregate, such Director shall be replaced by another Director nominated by SM, whose identity shall be subject to the Board’s approval not to be elected unreasonably withheld, conditioned or delayed (and who does not need to qualify as an “independent” director under NASDAQ listing rules). Subject to Board approval, the board appointment of directors (or similar governing body) such replacement Director shall be effected as promptly as reasonably practicable following the nomination of each material operating subsidiary of such replacement Director by SM.
vii. Subject to applicable law, the Company. The NomineeCEO undertakes to attend, as applicable, shall have the right to attend (whether in person or remotelyby proxy, the annual stockholders meeting(s) at which the appointment of any meetings Director nominated by SM pursuant to Section 2.01(b)(v) is on the agenda, and to vote his shares in favor of the board election of directors (or similar governing body or committee thereof) such Director.
viii. As of each subsidiary of immediately following the Company.’s 2021 annual meeting of stockholders (the “2021 Annual Meeting”), the total number of Directors constituting the full Board shall be eleven (11)
Appears in 1 contract
Director Nomination Rights. Subject (a) On the Closing Date, the Board shall appoint Shareholder to the terms Board. The parties acknowledge and conditions of this Agreement, at any time and from time to time on or after the date agree that the Company consummates a Business Combination and for so long as the Sponsor holds any Registrable Securities:
5.1.1 The Sponsor Shareholder shall have the right, but not the obligation, to designate three individuals to be appointed or nominated, as the case may be, for election to the Board (including any successor, each, a “Nominee”) by giving written notice to the Company on or before the time such information is reasonably requested by the Board or the Nominating Committee of the Board, as applicable, for inclusion in a proxy statement serve for a term expiring at Buyer's 2007 annual meeting term. Notwithstanding the foregoing, the appointment of stockholders provided Shareholder pursuant to the Sponsor.
5.1.2 The Company willthis Section 2(a), as promptly as practicable, use its best efforts to take all necessary and desirable actions (including, without limitation, calling special meetings of the Board and the stockholders and recommending, supporting and soliciting proxies) so that there are three Sponsor Directors serving on the Board at all times.
5.1.3 The Company shall, to the fullest extent permitted by applicable law, use its best efforts to take all actions necessary to ensure that: (i) each Nominee is included in the Board’s slate of nominees shall be subject to the stockholders approval process of the Company for each election of directors; Buyer's Nominating & Governance Committee, consistent with Buyer's Corporate Governance Guidelines, and (ii) each Nominee is included must have the requisite qualifications as determined in good faith by the proxy statement prepared by management of Nominating & Governance Committee. Nothing in this Section 2 shall prevent the Company Board from acting in connection good faith in accordance with soliciting proxies for every meeting of the stockholders of the Company called with respect its Corporate Governance Guidelines while giving due consideration to the election intent of members of this Agreement.
(b) After the Closing Date, Shareholder shall have the right to designate one Independent candidate to the Board, and at every adjournment or postponement thereofthe Board shall appoint the designated Independent candidate to the Board whenever such Independent candidate is designated by Shareholder. The parties acknowledge and agree that any such Independent candidate shall be appointed to the Board to serve for a term that complies with the requirements for the staggered terms and apportioned classes of Directors set forth in Buyer's By-laws. Notwithstanding the foregoing, the appointment of any shareholder designated candidate pursuant to this Section 2(b), (i) shall be subject to the approval process of Buyer's Nominating & Governance Committee, consistent with Buyer's Corporate Governance Guidelines, and on every action (ii) must have the requisite qualifications as determined in good faith by the Nominating & Governance Committee; provided, however, that if for any reason the conditions set forth in clauses (i) and (ii) are not satisfied, Shareholder shall have the right to designate an alternate person or approval by written consent of the stockholders of the Company or persons to be so nominated. Nothing in this Section 2 shall prevent the Board from acting in good faith in accordance with respect its Corporate Governance Guidelines while giving due consideration to the election intent of members of the Boardthis Agreement.
5.1.4 If (c) After the Closing Date, should there exist or occur any vacancy on the Board as a result of death, disability, retirement, resignation, removal or any other reason, including if any current Director shall not be nominated for re-election (other than any vacancy occurs because of resulting from the death, disability, disqualificationretirement, resignation, resignation or removal of a Sponsor Director Shareholder or for any other reasonShareholder Director), the Sponsor shall be entitled to designate such person’s successor, and the Company will, as promptly as practicable following such designation, use its best efforts to take all necessary and desirable actions, to the fullest extent permitted by law, within its control such that such vacancy shall be filled with such successor Nominee.
5.1.5 If a Nominee is not elected because of such Nominee’s death, disability, disqualification, withdrawal as a nominee or for any other reason, the Sponsor shall be entitled to designate promptly another Nominee and the Company will take all necessary and desirable actions within its control such that the director position for which such Nominee was nominated shall not be filled pending such designation or the size of the Board shall appoint one additional Independent candidate designated by Shareholder to the Board to serve for a term of office continuing only until the next election of the class of Directors in which the vacancy occurs. The parties acknowledge and agree that such Independent candidate shall be increased nominated to the same class as the Director that such Independent candidate is replacing. Notwithstanding the foregoing, the appointment of a Shareholder-designated candidate pursuant to this Section 2(c), (i) shall be subject to the approval process of Buyer's Nominating & Governance Committee, consistent with Buyer's Corporate Governance Guidelines, and (ii) must have the requisite qualifications as determined in good faith by one the Nominating & Governance Committee; provided, however, that if for any reason the conditions set forth in clauses (i) and (ii) are not satisfied, Shareholder shall have the right to designate an alternate person or persons to be so nominated. Nothing in this Section 2 shall prevent the Board from acting in good faith in accordance with its Corporate Governance Guidelines while giving due consideration to the intent of this Agreement.
(d) Following the initial appointments referenced in Sections 2 (a), (b) and (c) above, Buyer shall nominate for the Board at the next applicable annual meeting of the shareholders of Buyer, any Independent candidates designated by Shareholder pursuant to the terms of this Agreement (each such designated Independent candidate a "SHAREHOLDER DIRECTOR" and collectively, the "SHAREHOLDER DIRECTORS"); provided, however, that Buyer shall only be obligated to nominate any Shareholder Director at the annual meeting at which the term of the class of Directors to which any Shareholder Director belongs has expired and such vacancy class of Directors is up for election. In accordance with its Corporate Governance Guidelines, the Board shall be filled with such successor Nominee as promptly as practicable following such designation.
5.1.6 As promptly as reasonably practicable following submit in writing the request name of any Sponsor Director, Shareholder Director to the Company shall enter into an indemnification agreement with such Sponsor Director, in the form entered into with the other members of Buyer Nominating & Governance Committee for election to the Board. The Company shall pay the reasonable, documented out-of-pocket expenses incurred by the Sponsor Director in connection with his or her services provided to or on behalf of the Company, including attending meetings or events attended explicitly on behalf of the Company at the Company’s request.
5.1.7 The Company shall use its reasonable best efforts (i) purchase directors’ and officers’ liability insurance in an amount determined by to cause the Buyer Nominating & Governance Committee to include the name of the Shareholder Directors so submitted among its nominees for election to the Board to be reasonable and customary and (ii) for so long as a Sponsor Director serves as a director to cause the Board to unanimously recommend that the shareholders of Buyer vote in favor of the CompanyShareholder Directors; provided, maintain such coverage with respect to such Sponsor Director; provided however, that upon removal or resignation of such Sponsor Director if for any reason, reason the Company shall take all actions reasonably necessary to extend such directors’ and officers’ liability insurance coverage for a period of not less than six years from any such event conditions set forth in respect of any act or omission occurring at or prior to such event.
5.1.8 For so long as a Sponsor Director serves as a director of the Company, the Company shall not amend, alter or repeal any right to indemnification or exculpation covering or benefiting any director nominated pursuant to this Agreement as and to the extent consistent with applicable law, whether such right is contained in the Company’s certificate of incorporation or bylaws, each as amended, or another document (except to the extent such amendment or alteration permits the Company to provide broader indemnification or exculpation rights on a retroactive basis than permitted prior thereto).
5.1.9 Each Nominee may, but does not need to qualify as “independent” pursuant to listing standards of the New York Stock Exchange (or such other national securities exchange upon which the Company’s securities are then listed).
5.1.10 Any Nominee will be subject to the Company’s customary due diligence process, including its review of a completed questionnaire and a background check. Based on the foregoing, the Company may object to any Nominee provided (a) it does so in good faith, and (b) such objection is based upon any of the following: (i) such Nominee was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses), (ii) such Nominee was the subject of any order, judgment, or decree not subsequently reversed, suspended or vacated of any court of competent jurisdiction, permanently or temporarily enjoining such proposed director from, or otherwise limiting, the following activities: (A) engaging in any type of business practice, or (B) engaging in any activity in connection with the purchase or sale of any security or in connection with any violation of federal or state securities laws, (iii) such Nominee was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described in clause (ii)(B), or to be associated with persons engaged in such activity, (iv) such proposed director was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any federal or state securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended or vacated, or (v) such proposed director was the subject of, or a party to any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to a violation of any federal or state securities laws or regulations. In the event the Board reasonably finds the Nominee to be unsuitable based upon one or more of the foregoing clauses (i) through and (vii) and reasonably objects to the identified directorare not satisfied, Sponsor shall be entitled to propose a different nominee to the Board within 30 calendar days of the Company’s notice to Sponsor of its objection to the Nominee and such replacement Nominee shall be subject to the review process outlined above.
5.1.11 The Company shall take all necessary action to cause a Nominee chosen by the Sponsor, at the request of such Nominee to be elected to the board of directors (or similar governing body) of each material operating subsidiary of the Company. The Nominee, as applicable, Shareholder shall have the right to attend (in designate an alternate person or remotelypersons to be so nominated. Nothing in this Section 2 shall prevent the Board from acting in good faith in accordance with its Corporate Governance Guidelines while giving due consideration to the intent of this Agreement.
(e) any meetings Following the initial appointment of Shareholder referenced in Section 2(a) above, Buyer shall nominate Shareholder at each applicable annual meeting of the board shareholders of directors (or similar governing body or committee thereof) of Buyer to serve on the Board; provided, however, the Buyer shall only be obligated to nominate the Shareholder at each subsidiary annual meeting at which the term of the Companyclass of Directors to which Shareholder belongs has expired and such class of Directors is up for election. In accordance with its Corporate Governance Guidelines, the Board shall submit in writing Shareholder's name to the Buyer Nominating & Governance Committee for election to the Board. The Company shall use its reasonable best efforts (i) to cause the Buyer Nominating & Governance Committee to include the Shareholder so submitted among its nominees for election to the Board and (ii) to cause the Board to unanimously recommend that the shareholders of Buyer to vote in favor of Shareholder. Nothing in this Section 2 shall prevent the Board from acting in good faith in accordance with its Corporate Governance Guidelines while giving due consideration to the intent of this Agreement.
(f) The Shareholder Directors (but not the Shareholder), will each be invited to serve on at least one committee of the Board while serving as Directors, in accordance with and subject to their respective qualifications. The parties hereto acknowledge and agree that so long as each applicable Shareholder Director (i) submits to the proper approval process with the Nominating & Governance Committee, consistent with Buyer's Corporate Governance Guidelines and (ii) has the requisite qualifications as determined in good faith by the Nominating & Governance Committee, one of the Shareholder Directors will be invited to serve on the Audit Committee of the Board while serving as a Director and one of the Shareholder Directors will be invited to serve on the Compensation Committee of the Board while serving as a Director.
(g) Subject to Sections 2(d), 2(h), 3, and 5, in the event any Shareholder Director dies, becomes disabled or resigns, retires or is removed from the Board, Shareholder shall have the right to designate a replacement director to fill such vacancy to serve for a term of office continuing only until the next election of the class of Directors in which the vacancy occurs and such replacement director shall be considered a "Shareholder Director" for purposes of this Agreement.
(i) The rights of Shareholder to designate any Shareholder Director, the right of any Shareholder Director to sit on the Board, and the obligations of the Board and Buyer pursuant to this Section 2 with respect to the Shareholder Directors shall terminate in the event that Shareholder both (A) ceases to Own 9% of the outstanding shares of Buyer common stock and (B) ceases to Own 9,000,000 shares of Buyer common stock.
(ii) All rights of Shareholder, including without limitation, the right of Shareholder to sit on the Board, and the obligations of the Board and Buyer pursuant to this Section 2, shall terminate in the event Shareholder ceases to Own 5,000,000 shares of Buyer common stock.
Appears in 1 contract
Samples: Nominating Agreement (Perrigo Co)
Director Nomination Rights. Subject to the terms and conditions of this Agreement, at any time and from time to time on or after the date that the Company consummates a Business Combination and for so long as the Sponsor holds any Registrable Securities:
5.1.1 The Sponsor shall have the right, but not the obligation, to designate three individuals to be appointed or nominated, as the case may be, for election to the Board (including any successor, each, a “Nominee”a) by giving written notice to the Company on or before the time such information is reasonably requested by the Board or the Nominating Committee of the Board, as applicable, for inclusion in a proxy statement for a meeting of stockholders provided to the Sponsor.
5.1.2 The Company will, as promptly as practicable, use its best efforts to take all necessary and desirable actions (including, without limitation, calling special meetings of the Board and the stockholders and recommending, supporting and soliciting proxies) so that there are three Sponsor Directors serving on the Board at all times.
5.1.3 The Company shall, to the fullest extent permitted by applicable law, use its best efforts to take all actions necessary to ensure that: (i) each Nominee is included in the Board’s slate of nominees to the stockholders of the Company for each election of directors; and (ii) each Nominee is included in the proxy statement prepared by management of the Company in In connection with soliciting proxies for every any annual or special meeting of the stockholders of the Company called at which directors shall be elected, (i) until the Trigger Date, GE shall have the right to designate five (5) persons for nomination by the Company Board for election to the Company Board and (ii) following the Trigger Date, but prior to the first date on which members of the GE Group cease to beneficially own at least twenty percent (20%) of the voting power of the outstanding Company Common Stock (the “20% Trigger Date”), GE shall have the right to designate one (1) person for nomination by the Company Board for election to the Company Board (each person so designated pursuant to (i) or (ii), a “GE Designee”). Subject to the first sentence of this Section 3.2(a), GE shall have full authority and ability to nominate, elect and remove the GE Designees. GE shall not designate any person to be a GE Designee who it believes does not meet the requirements for director nominees as set forth in the applicable policies of the Company relating to director qualification from time to time. The Company Board shall promptly and in good faith consider each GE Designee designated pursuant to this Section 3.2(a), applying the same standards as shall be applied for the consideration of other proposed nominees of the Company Board. In the event that the Company Board fails to approve the nomination of any GE Designee, GE shall have the right to designate an alternative GE Designee for consideration. For the avoidance of doubt, current or former employment of any GE Designee by GE or any of its Subsidiaries or service by any such GE Designee on the board of directors of GE or any of its Subsidiaries shall not disqualify such individual from serving on the Company Board as a GE Designee.
(b) Notwithstanding Section 3.2(a), until the Trigger Date, if the size of the Company Board shall, with respect GE’s prior written approval or otherwise, be increased or decreased, GE shall have the right to designate one or more GE Designees to the Company Board such that the total number of GE Directors on the Company Board shall be proportional (rounded up to the nearest whole number) to the number of GE Directors on the Company Board set forth in Section 3.1(a).
(c) The Company shall cause each GE Designee and Non-GE Designee whose nomination has been approved to be included in the slate of nominees recommended by the Company Board to holders of Company Common Stock for election (including at any special meeting of stockholders held for the election of members of the Board, directors) and at every adjournment or postponement thereof, and on every action or approval by written consent of the stockholders of the Company or the Board with respect to the election of members of the Board.
5.1.4 If a vacancy occurs because of the death, disability, disqualification, resignation, or removal of a Sponsor Director or for any other reason, the Sponsor shall be entitled to designate such person’s successor, and the Company will, as promptly as practicable following such designation, use its best efforts to take all necessary cause the election of each such GE Designee and desirable actionsNon-GE Designee, including soliciting proxies in favor of the election of such persons.
(d) As to any GE Director designated pursuant to Section 3.2(a) (including clause (ii) thereof), in the fullest extent permitted by law, within its control such event that such GE Director shall cease to serve as a director for any reason, and so long as GE has the right to designate such director, the vacancy resulting therefrom shall be filled by the Company Board with such successor Nomineea substitute GE Director.
5.1.5 If (e) From and after the Original Effective Date, in the event of a Nominee is not elected because of such Nominee’s vacancy on the Company Board upon the death, disabilityresignation, retirement, disqualification, withdrawal as removal from office or other cause of any director who was not a nominee or for any other reasonGE Designee, the Sponsor Governance & Nominating Committee shall be entitled have the sole right to fill such vacancy or designate promptly another Nominee and a person for nomination for election to the Company will take all necessary and desirable actions within its control such that the director position for which such Nominee was nominated shall not be filled pending such designation or the size of the Board shall be increased by one and to fill such vacancy shall be filled (each such person, a “Non-GE Designee”); provided that with respect to any filling of vacancy or designation prior to the 20% Trigger Date, such successor Nominee as promptly as practicable following such designationindividual is reasonably acceptable to GE.
5.1.6 As promptly as reasonably practicable following (f) Until the request of any Sponsor DirectorTrigger Date, the Company shall enter into an indemnification agreement with such Sponsor Director, in avail itself of all available “controlled company” exceptions to the form entered into with the other members corporate governance listing standards of the Board. The Company shall pay the reasonableNYSE, documented out-of-pocket expenses incurred by the Sponsor Director in connection with his or her services provided to or on behalf of the Companyand, including attending meetings or events attended explicitly on behalf of the Company at the Company’s request.
5.1.7 The Company shall (i) purchase directors’ and officers’ liability insurance in an amount determined by the Board to be reasonable and customary and (ii) for so long as a Sponsor Director serves as a director of the Company, maintain such coverage with respect to such Sponsor Director; provided that upon removal or resignation of such Sponsor Director for any reasonthereafter, the Company shall take all actions reasonably necessary to extend such directors’ and officers’ liability insurance coverage for a period of not less than six years from any such event in respect of any act or omission occurring at or prior to such event.
5.1.8 For so long as a Sponsor Director serves as a director of comply with the Company, the Company shall not amend, alter or repeal any right to indemnification or exculpation covering or benefiting any director nominated pursuant to this Agreement as and to the extent consistent with applicable law, whether such right is contained in the Company’s certificate of incorporation or bylaws, each as amended, or another document (except to the extent such amendment or alteration permits the Company to provide broader indemnification or exculpation rights on a retroactive basis than permitted prior thereto).
5.1.9 Each Nominee may, but does not need to qualify as “independent” pursuant to corporate governance listing standards of the New York Stock Exchange (or such other national securities exchange upon which NYSE, including those relating to the Company’s securities are then listed)composition of the committees of the Company Board.
5.1.10 Any Nominee will be subject to (g) For the Company’s customary due diligence processavoidance of doubt, including its review of a completed questionnaire and a background check. Based on the foregoing, the Company may object to any Nominee provided (a) it does so in good faith, and (b) such objection is based upon any of the following: (i) such Nominee was convicted GE shall have the right, in a criminal proceeding or is a named subject its sole discretion, to waive any and all of a pending criminal proceeding (excluding traffic violations and other minor offenses)the rights granted to it under this Section 3.2, by delivery of written notice to the Company in accordance with Section 7.4, (ii) such Nominee was on (or prior to, but only effective upon) the subject Trigger Date and the 20% Trigger Date, each GE Designee shall deliver his or her resignation from the Company Board for consideration by the Conflicts Committee (provided, that one GE Designee, as designated by GE, shall be exempt from the requirements of any order, judgment, or decree not subsequently reversed, suspended or vacated of any court of competent jurisdiction, permanently or temporarily enjoining such proposed director from, or otherwise limiting, this clause (ii) where the following activities: (ATrigger Date has occurred without the 20% Trigger Date also contemporaneously occurring) engaging in any type of business practice, or (B) engaging in any activity in connection with the purchase or sale of any security or in connection with any violation of federal or state securities laws, and (iii) such Nominee was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described in clause (ii)(B), or to be associated with persons engaged in such activity, (iv) such proposed director was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any federal or state securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended or vacated, or (v) such proposed director was the subject of, or a party to any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to a violation of any federal or state securities laws or regulations. In the event the Board reasonably finds the Nominee to be unsuitable based upon one or more of the foregoing clauses (i) through (v) and reasonably objects to the identified director, Sponsor shall be entitled to propose a different nominee to the Board within 30 calendar days of the Company’s notice to Sponsor of its objection to the Nominee and such replacement Nominee shall be subject to the review process outlined above.
5.1.11 The Company shall take all necessary action to cause a Nominee chosen by the Sponsor, at the request of such Nominee to be elected to the board of directors (or similar governing body) of each material operating subsidiary of the Company. The Nominee, as applicable, GE shall have the no right to attend (in person or remotely) any meetings of designate a GE Designee after the board of directors (or similar governing body or committee thereof) of each subsidiary of the Company20% Trigger Date.
Appears in 1 contract
Director Nomination Rights. Subject (a) So long as at least 200,000 Series D Preferred Shares remain outstanding, the holders of Series D Preferred Shares voting as a separate class at a meeting of such shareholders duly called for that purpose shall be entitled to elect two members of the Board of Directors (each, a “Series D Preferred Director”); provided, however, that the initial Series D Preferred Directors shall be the two individuals designated by SunLink prior to the Closing pursuant to the terms and conditions of this the Merger Agreement.
(b) If, at any time and from time to time on or after 200,000 Series D Preferred Shares remain outstanding, any vacancy in the date that the Company consummates office of a Business Combination and for so long as the Sponsor holds any Registrable Securities:
5.1.1 The Sponsor Series D Preferred Director shall have the rightoccur, but not the obligation, to designate three individuals to then such vacancy may be appointed or nominated, as the case may be, for election to the Board (including any successor, each, a “Nominee”) by giving written notice to the Company on or before the time such information is reasonably requested filled only by the Board remaining Series D Preferred Director or the Nominating Committee by a vote of the Board, as applicable, for inclusion in a proxy statement for holders of record of the outstanding Series D Preferred Shares at a meeting of stockholders provided to such shareholders duly called for that purpose. In no event shall the Sponsor.
5.1.2 The Company will, as promptly as practicable, use its best efforts to take all necessary and desirable actions (including, without limitation, calling special meetings remaining Series D Preferred Director or holders of the Board Series D Preferred Shares be entitled pursuant to this paragraph (b) of Section 11.8 to submit and the stockholders and recommending, supporting and soliciting proxies) so that there are three Sponsor Directors serving on the Board at all times.
5.1.3 The Company shall, appoint a director nominee to the fullest extent permitted by applicable law, use its best efforts to take all actions necessary to ensure that: fill a vacancy (i) each Nominee is included whose appointment as a director would violate or cause the Corporation to be in violation of these Amended and Restated Articles of Incorporation, as amended, the BoardCorporation’s slate Amended and Restated Bylaws, as amended, the Corporation’s Code of nominees Business Conduct and Ethics, the Corporation’s requirements with regard to the stockholders director qualifications and policies and guidelines applicable to directors, any National Securities Exchange pursuant to which any class or series of the Company for each election stock of directorsthe Corporation is listed or quoted or any applicable state or federal law, rule or regulation; and (ii) each Nominee is included in who would cause the proxy statement prepared by management Corporation to fail to satisfy a requirement relating to director independence of any National Securities Exchange pursuant to which any class or series of the Company in connection with soliciting proxies for every meeting stock of the stockholders of the Company called with respect to the election of members of the Board, and at every adjournment Corporation is listed or postponement thereof, and on every action or approval by written consent of the stockholders of the Company or the Board with respect to the election of members of the Board.
5.1.4 If a vacancy occurs because of the death, disability, disqualification, resignation, or removal of a Sponsor Director or for any other reason, the Sponsor shall be entitled to designate such person’s successor, and the Company will, as promptly as practicable following such designation, use its best efforts to take all necessary and desirable actions, to the fullest extent permitted by law, within its control such that such vacancy shall be filled with such successor Nominee.
5.1.5 If a Nominee is not elected because of such Nominee’s death, disability, disqualification, withdrawal as a nominee or for any other reason, the Sponsor shall be entitled to designate promptly another Nominee and the Company will take all necessary and desirable actions within its control such that the director position for which such Nominee was nominated shall not be filled pending such designation or the size of the Board shall be increased by one and such vacancy shall be filled with such successor Nominee as promptly as practicable following such designation.
5.1.6 As promptly as reasonably practicable following the request of any Sponsor Director, the Company shall enter into an indemnification agreement with such Sponsor Director, in the form entered into with the other members of the Board. The Company shall pay the reasonable, documented out-of-pocket expenses incurred by the Sponsor Director in connection with his or her services provided to or on behalf of the Company, including attending meetings or events attended explicitly on behalf of the Company at the Company’s request.
5.1.7 The Company shall quoted; (iiii) purchase directors’ and officers’ liability insurance in an amount determined by the Board to be reasonable and customary and (ii) for so long as a Sponsor Director serves as a director of the Company, maintain such coverage with respect to such Sponsor Director; provided that upon removal or resignation of such Sponsor Director for any reason, the Company shall take all actions reasonably necessary to extend such directors’ and officers’ liability insurance coverage for a period of not less than six years from any such event in respect of any act or omission occurring at or prior to such event.
5.1.8 For so long as a Sponsor Director serves as a director of the Company, the Company shall not amend, alter or repeal any right to indemnification or exculpation covering or benefiting any director nominated pursuant to this Agreement as and to the extent consistent with applicable law, whether such right is contained in the Company’s certificate of incorporation or bylaws, each as amended, or another document (except to the extent such amendment or alteration permits the Company to provide broader indemnification or exculpation rights on a retroactive basis than permitted prior thereto).
5.1.9 Each Nominee may, but does not need to qualify as “independent” pursuant to listing standards of the New York Stock Exchange (or such other national securities exchange upon which the Company’s securities are then listed).
5.1.10 Any Nominee will be subject to the Company’s customary due diligence process, including its review of a completed questionnaire and a background check. Based on the foregoing, the Company may object to any Nominee provided (a) it does so in good faith, and (b) such objection is based upon any of the following: (i) such Nominee was convicted in a criminal proceeding or who is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses) or has been convicted in such a criminal proceeding within the past ten years; or (iv) who is subject to any order of the type specified in Rule 506(d) of Regulation D under the Securities Act (an “Ineligible Person”). Other than as provided in this paragraph (b) of Section 11.8, any Series D Preferred Director may be removed only by the affirmative vote of holders of the outstanding Series D Preferred Shares, such removal to be effected by the affirmative vote of a majority of the votes entitled to be cast by the holders of the outstanding Series D Preferred Shares at a meeting of such shareholders duly called for that purpose. Notwithstanding anything herein to the contrary, a Series D Preferred Director may be removed in accordance with Section 14-2-808 of the Official Code of Georgia Annotated and applicable law.
(c) If, at any time when the voting right conferred upon the Series D Preferred Shares pursuant to paragraph (a) of Section 11.8 is exercisable, the Corporation shall include in its proxy statement (including its form of proxy and ballot) for the next annual meeting of shareholders, the names of any nominees for election to the Board of Directors submitted pursuant to Section 11.8 (each, a “Preferred Nominee”), provided:
(i) timely written notice of such Preferred Nominees satisfying Section 11.8 (“Nomination Notice”) is given to the Corporation by or on behalf of a holder or holders of Series D Preferred Shares that, at the time the Nomination Notice is given, satisfy the ownership and other requirements of Section 11.8 (each, an “Eligible Preferred Holder”);
(ii) each Eligible Preferred Holder expressly elects in writing at the time of providing the Nomination Notice to have its Preferred Nominees included in the Corporation’s proxy statement pursuant to Section 11.8; and
(iii) each Eligible Preferred Holder and each Preferred Nominee otherwise satisfy the requirements of Section 11.8.
(d) The Nomination Notice shall be directed to the attention of the Secretary of the Corporation. To be timely, the Nomination Notice shall be delivered to or mailed and received at the principal executive office of the Corporation not less than 60 nor more than 200 days before the first anniversary of the date of the Corporation’s notice of annual meeting sent to shareholders in connection with the previous year’s annual meeting; provided that if no annual meeting was held in the previous year, or the date of the annual meeting has been established to be more than 30 days earlier than, or 60 days after, the anniversary of the previous year’s annual meeting, the Nomination Notice, to be timely, must be so delivered or mailed and received not later than (i) the 90th day prior to the annual meeting or (ii) if later, the close of business on the tenth day following the day on which public announcement is first made of the date of the annual meeting. In no event shall the public announcement of an adjournment or postponement of an annual meeting commence a new time period (or extend any time period) for the giving of the Nomination Notice.
(e) In addition to including the names of the Preferred Nominees in the Corporation’s proxy statement for the annual meeting, the Corporation shall also include the information concerning the Preferred Nominees and each Eligible Preferred Holder that is required to be disclosed in the Corporation’s proxy statement pursuant to the Exchange Act.
(f) Each Eligible Preferred Holder and Preferred Nominee, as the case may be, must provide within ten Business Days of receipt of the written request of the Corporation (i) information reasonably necessary to (A) verify that such Eligible Preferred Holder owns the Required Shares (which request, for the avoidance of doubt, may be satisfied with written statements from such Eligible Preferred Holder and each intermediary through which the Required Shares are held verifying that such Eligible Preferred Holder beneficially owns the Required Shares, a certificate or certificates representing the Required Shares in such Eligible Preferred Holder’s name or any other reasonably acceptable proof) and (B) determine whether such Preferred Nominee meets the Corporation’s reasonable requirements with regard to director qualifications and policies and guidelines applicable to each of the other serving non-management directors of the Corporation, including whether such Preferred Nominee satisfies the requirements relating to director independence of any National Securities Exchange pursuant to which any class or series of the stock of the Corporation is listed or quoted; and (ii) such additional information, limited to the type of information set forth in Section 2.15 of the Corporation’s Amended and Restated Bylaws, as the Corporation may reasonably request in writing.
(g) In the event that any information or communications provided by an Eligible Preferred Holder or Preferred Nominee was to the subject Corporation or its shareholders ceases to be true and correct in any material respect or omits a fact necessary to make the statements made, in light of the circumstances under which they were made, not materially misleading, each Eligible Preferred Holder or Preferred Nominee, as the case may be, shall promptly notify in writing the Secretary of the Corporation of any order, judgment, such inaccuracy or decree not subsequently reversed, suspended omission in such previously provided information and of the information that is required to make such information or vacated of any court of competent jurisdiction, permanently or temporarily enjoining such proposed director from, or otherwise limitingcommunication true and correct in all material respects.
(h) In no event shall an Eligible Preferred Holder be entitled pursuant to Section 11.8 to submit and have elected a Preferred Nominee who is an Ineligible Person. If the Preferred Nominee is an Ineligible Person, the following activities: Corporation shall promptly notify in writing such Eligible Preferred Holder, and such Eligible Preferred Holder shall be entitled to submit a substitute Preferred Nominee within the same time period for the giving of the Nomination Notice in paragraph (d) of Section 11.8.
(Ai) engaging in any type An Eligible Preferred Holder must beneficially own a number of business practice, Series D Preferred Shares that represents 8% or more of the outstanding Series D Preferred Shares (Bthe “Required Shares”) engaging in any activity in connection with as of both the purchase date the Nomination Notice is delivered to or sale of any security or in connection with any violation of federal or state securities laws, (iii) such Nominee was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described in clause (ii)(B), or to be associated with persons engaged in such activity, (iv) such proposed director was found by a court of competent jurisdiction in a civil action or received by the Commission to have violated any federal or state securities law, Corporation in accordance with Section 11.8 and the judgment in such civil action or finding by record date for determining holders entitled to vote at the Commission has not been subsequently reversed, suspended or vacated, or (v) such proposed director was the subject of, or a party to any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to a violation of any federal or state securities laws or regulationsmeeting. In the event there is more than one Eligible Preferred Holder for any annual meeting, each Eligible Preferred Holder may submit Preferred Nominees for inclusion in the Board reasonably finds Corporation’s proxy statement.
(j) So long as at least 200,000 Series D Preferred Shares remain outstanding at the Nominee to be unsuitable based upon one or more commencement of the foregoing clauses (i) through (v) and reasonably objects to the identified directorapplicable annual meeting, Sponsor shall be entitled to propose a different nominee to the Board within 30 calendar days of the Company’s notice to Sponsor of its objection to the Nominee and such replacement Nominee shall be subject to the review process outlined aboveprovisions of Section 11.8, then two directors shall be elected out of the Preferred Nominee(s) by a plurality of the votes cast by the Series D Preferred Shares at the annual meeting.
5.1.11 The Company shall take all necessary action to cause a Nominee chosen by the Sponsor, (k) If less than 200,000 Series D Preferred Shares remain outstanding at the request of such Nominee to be elected or prior to the board of directors (or similar governing body) of each material operating subsidiary of the Company. The Nomineeannual meeting, then, as applicable, shall have either (i) prior to a vote being held on the right to attend (in person or remotely) any meetings election of a director out of the board Preferred Nominees at the annual meeting, all Preferred Nominees shall be automatically deemed to have withdrawn from the election or (ii) if a vote is held on the election of a director out of the Preferred Nominees at the annual meeting, (A) such vote will be deemed void, (B) the Preferred Nominees who received a plurality of the votes cast by the Series D Preferred Shares at the annual meeting shall not be deemed to have been elected as directors and (C) the number of directors constituting the Board of Directors shall be reduced accordingly.
(or similar governing body or committee thereofl) of each subsidiary On the date on which less than 200,000 Series D Preferred Shares remain outstanding occurs, the rights under this Section 11.8 will cease, and the term of the CompanySeries D Preferred Directors then serving on the Board of Directors, if any, shall immediately terminate and the number of directors constituting the Board of Directors shall be reduced accordingly.
Appears in 1 contract
Director Nomination Rights. Subject to the terms and conditions of this Agreement, at any time and from time to time on or after the date that the Company consummates a Business Combination and for For so long as the Sponsor holds any Registrable Securities:
5.1.1 The Sponsor Investor and/or its Affiliates, in the aggregate, beneficially own Common Stock equivalent to 5.00% of the voting power of the capital stock of the Corporation entitled to vote for the election of directors (the “Preferred Stock Director Nomination Right Condition”), the Investor shall have the right, but not right to nominate to serve on the obligation, Board a number of persons sufficient to designate three individuals to be appointed or nominated, as constitute a majority of the case may be, total number of directorships then authorized for election to the Board (including any successor, eacheach such nominee, a “Preferred Stock Nominee,” and each such director, a “Preferred Stock Director”). For so long as the Preferred Stock Director Nomination Right Condition continues to be satisfied, the Corporation shall use its reasonable best efforts to cause the Preferred Stock Nominee(s) by giving written notice to the Company on or before the time such information is reasonably requested by the Board or the Nominating Committee of be elected to the Board, including by nominating the Preferred Stock Nominee(s) as designated by the Investor in writing for election (or re-election, as applicable, for inclusion in ) as a proxy statement for a meeting director at the end of stockholders provided to the Sponsor.
5.1.2 The Company will, as promptly as practicable, use its best efforts to take all necessary and desirable actions (including, without limitation, calling special meetings each term of the Board and the stockholders and recommending, supporting and soliciting proxiesPreferred Stock Director(s) so that there are three Sponsor Directors serving on the Board at all times.
5.1.3 The Company shall, to the fullest extent permitted by applicable law, use its best efforts to take all actions necessary to ensure that: (i) each Nominee is included in the Board’s slate of nominees to the stockholders as part of the Company for each election of directors; and (ii) each Nominee slate proposed by the Corporation that is included in the proxy statement prepared by management (or consent solicitation or similar document) of the Company in connection with soliciting proxies for every meeting of the stockholders of the Company called with respect Corporation relating to the election of members the Board and recommending approval of the Boardelection of such Preferred Stock Nominee(s) in such proxy statement (or consent solicitation or similar document). At such time as the Preferred Stock Director Nomination Right Condition is no longer satisfied, the Preferred Stock Director(s) shall offer in writing to resign from the Board and at every adjournment or postponement thereofany committees thereof effective as of a date within thirty (30) days after the first date that the Preferred Stock Director Nomination Right Condition is no longer satisfied, and, from and on every action or approval after such date, the Investor shall cease to have any rights under this Section 9. At all times when the Preferred Stock Director Nomination Right Condition is satisfied, a vacancy in the office of the Preferred Stock Director(s) shall only be filled by the written consent of the stockholders of the Company or the Board with respect to the election of members of the Board.
5.1.4 If a vacancy occurs because of the death, disability, disqualification, resignation, or removal of a Sponsor Director or for any other reason, the Sponsor shall be entitled to designate such person’s successor, Investor and the Company will, as promptly as practicable following Corporation shall cause such designation, use its best efforts Preferred Stock Nominee(s) designated in such written consent to take all necessary and desirable actionsfill such resulting vacancy. Notwithstanding the foregoing, to the fullest extent permitted by lawthe Investor (and/or any of its Affiliates) holds the Series A Preferred Stock, within its control such that such vacancy the total number of directorships the Investor is entitled to appoint under this Section 9 shall be filled with such successor Nominee.
5.1.5 If reduced on a Nominee one-for-one basis by any director(s) the Investor is not elected because of such Nominee’s death, disability, disqualification, withdrawal as a nominee or for any other reason, the Sponsor shall be entitled to designate promptly another Nominee and appoint under the Company will take all necessary and desirable actions within its control such that the director position for which such Nominee was nominated shall not be filled pending such designation or the size Series A Preferred Stock Certificate of the Board shall be increased by one and such vacancy shall be filled with such successor Nominee as promptly as practicable following such designationDesignations.
5.1.6 As promptly as reasonably practicable following the request of any Sponsor Director, the Company shall enter into an indemnification agreement with such Sponsor Director, in the form entered into with the other members of the Board. The Company shall pay the reasonable, documented out-of-pocket expenses incurred by the Sponsor Director in connection with his or her services provided to or on behalf of the Company, including attending meetings or events attended explicitly on behalf of the Company at the Company’s request.
5.1.7 The Company shall (i) purchase directors’ and officers’ liability insurance in an amount determined by the Board to be reasonable and customary and (ii) for so long as a Sponsor Director serves as a director of the Company, maintain such coverage with respect to such Sponsor Director; provided that upon removal or resignation of such Sponsor Director for any reason, the Company shall take all actions reasonably necessary to extend such directors’ and officers’ liability insurance coverage for a period of not less than six years from any such event in respect of any act or omission occurring at or prior to such event.
5.1.8 For so long as a Sponsor Director serves as a director of the Company, the Company shall not amend, alter or repeal any right to indemnification or exculpation covering or benefiting any director nominated pursuant to this Agreement as and to the extent consistent with applicable law, whether such right is contained in the Company’s certificate of incorporation or bylaws, each as amended, or another document (except to the extent such amendment or alteration permits the Company to provide broader indemnification or exculpation rights on a retroactive basis than permitted prior thereto).
5.1.9 Each Nominee may, but does not need to qualify as “independent” pursuant to listing standards of the New York Stock Exchange (or such other national securities exchange upon which the Company’s securities are then listed).
5.1.10 Any Nominee will be subject to the Company’s customary due diligence process, including its review of a completed questionnaire and a background check. Based on the foregoing, the Company may object to any Nominee provided (a) it does so in good faith, and (b) such objection is based upon any of the following: (i) such Nominee was convicted in a criminal proceeding or is a named subject of a pending criminal proceeding (excluding traffic violations and other minor offenses), (ii) such Nominee was the subject of any order, judgment, or decree not subsequently reversed, suspended or vacated of any court of competent jurisdiction, permanently or temporarily enjoining such proposed director from, or otherwise limiting, the following activities: (A) engaging in any type of business practice, or (B) engaging in any activity in connection with the purchase or sale of any security or in connection with any violation of federal or state securities laws, (iii) such Nominee was the subject of any order, judgment or decree, not subsequently reversed, suspended or vacated, of any federal or state authority barring, suspending or otherwise limiting for more than 60 days the right of such person to engage in any activity described in clause (ii)(B), or to be associated with persons engaged in such activity, (iv) such proposed director was found by a court of competent jurisdiction in a civil action or by the Commission to have violated any federal or state securities law, and the judgment in such civil action or finding by the Commission has not been subsequently reversed, suspended or vacated, or (v) such proposed director was the subject of, or a party to any federal or state judicial or administrative order, judgment, decree, or finding, not subsequently reversed, suspended or vacated, relating to a violation of any federal or state securities laws or regulations. In the event the Board reasonably finds the Nominee to be unsuitable based upon one or more of the foregoing clauses (i) through (v) and reasonably objects to the identified director, Sponsor shall be entitled to propose a different nominee to the Board within 30 calendar days of the Company’s notice to Sponsor of its objection to the Nominee and such replacement Nominee shall be subject to the review process outlined above.
5.1.11 The Company shall take all necessary action to cause a Nominee chosen by the Sponsor, at the request of such Nominee to be elected to the board of directors (or similar governing body) of each material operating subsidiary of the Company. The Nominee, as applicable, shall have the right to attend (in person or remotely) any meetings of the board of directors (or similar governing body or committee thereof) of each subsidiary of the Company.
Appears in 1 contract
Samples: Securities Purchase Agreement (Rubicon Technologies, Inc.)
