Drag Along Right. Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable law.
Appears in 6 contracts
Samples: Management Shareholder Agreement (TRAC Intermodal LLC), Management Shareholder Agreement (TRAC Intermodal LLC), Management Shareholder Agreement (TRAC Intermodal LLC)
Drag Along Right. Notwithstanding 3.1. In the event that a Stockholder or Stockholders holding Shares or Preferred Shares which represent a majority of the Shares (or Preferred Shares) then held by all Stockholders (the "Majority Stockholders") desire to pursue discussions with any other provision hereofthird party regarding a potential Transfer of all of the Shares (or Preferred Shares) then held by the Majority Stockholders to such third party at any time, if the Majority Stockholders shall, prior to pursuing such discussions, disclose to the Board their intentions with respect thereto.
3.2. In the event that the Majority Stockholders shall agree to Transfer, in a bona fide arm's length transaction for value (either in a single transaction or a series of related transactions), a direct or indirect interest in all of the Shares (or Preferred Shares) owned by the Majority Stockholders to any Holder has not exercised its TagPerson or "group" (as such term is used for purposes of Section 13(d) of the Exchange Act) (the "Buyer"), which Buyer desires also to purchase all of the Shares (or Preferred Shares) then owned by the Remaining Stockholders or their successors or assigns for the same price per share as the Buyer contemplates purchasing the Majority Stockholders' Shares (or Preferred Shares), the Majority Stockholders shall notify the Remaining Stockholders and the Company in writing (such notice, a "Drag-Along Right Notice") of its intention to effectuate such contemplated transaction, setting forth in such Drag-Along Notice the identity of the Buyer, the aggregate purchase price which the Buyer shall pay for all of the Shares or Preferred Shares and the intended date on which such transaction shall close; and the Remaining Stockholders shall, on the basis of such notification, fully cooperate in such transaction and sell all of their Shares or Preferred Shares to such Buyer, for the same price and otherwise in accordance with respect identical terms and conditions as those on which the Majority Stockholders shall sell their Shares or Preferred Shares to such Buyer. The Drag-Along Notice shall be delivered no more than 90 nor fewer than 15 days prior to the maximum number intended date of Holder’s Shares for which the closing of such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise transaction, and such Tag-Along Right transaction shall not, in respect of a Third Party Salefact, then, upon close more than 270 calendar days after the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date delivery of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawNotice.
Appears in 5 contracts
Samples: Stockholders Agreement (Spectrum Equity Investors Lp), Stockholders Agreement (American Cellular Corp /De/), Stockholders Agreement (American Cellular Corp /De/)
Drag Along Right. (i) Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect anything to the maximum number contrary contained herein, at any time (i) if each of Holder’s Shares for which the Actual Controller, Genesis Capital, Tencent, Tiger Fund and Eastern Bell and the Series F Lead Investor (collectively the “Drag Holders”) approves a Trade Sale of the Group Companies, and (ii) provided that (X) the valuation of the Group Companies immediately prior to such Holder Trade Sale is permitted no less than 1.2 times a valuation of the Company representing a per share price equaling to the Deemed Series F Issue Price, in case of any Trade Sale occurring prior to December 31, 2022, or (pursuant Y) the valuation of the Group Companies immediately prior to Section 2(b)(ii)(Bsuch Trade Sale is no less than 1.4 times a valuation of the Company representing a per share price equaling to the Deemed Series F Issue Price, in case of any Trade Sale occurring on or after January 1, 2023 and prior to December 31, 2023, or (Z) above) the valuation of the Group Companies immediately prior to exercise such Tag-Along Right Trade Sale is no less than 2.0 times a valuation of the Company representing a per share price equaling to the Deemed Series F Issue Price, in respect case of any Trade Sale occurring on or after January 1, 2024, then the Drag Holders shall have the right to deliver a Third Party written notice to notify each other Shareholder of the Company of such Trade Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in whereupon each such entity’s sole discretion)Shareholder shall, such Holder shall sell to in accordance with the respective Third Party instructions received from the number of whole Holder’s Shares (rounded upwards or downwardsDrag Holders, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date take each of the Drag-Along Notice actions set forth in clauses (as defined belowa) and (yb) below:
(a) vote all of its Equity Securities of the Third Party Sale PercentageCompany in favor of such Trade Sale;
(b) sell such Shareholder’s pro rata portion of the Equity Securities of the Company, at the same price and on the same terms and conditions and at the sale price as such Selling Fortress Entity has agreed approved by the Drag Holders. Any proceeds received from the Trade Sale shall be distributed among the Shareholders of the Company in accordance with Section 4.6(i). In no event shall the Shareholders’ obligations under this Section 4.7(i) result in violation of any laws and regulations with respect to with such Third Partythe transfer of state-owned assets or any requirements of state-owned assets supervision and administration authorities; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity Shareholders shall use its reasonable, good faith their reasonable efforts to provide that (A) the only representation and warranty which cause such Holder shall Trade Sale to be required to make consummated in connection accordance with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership relevant provisions of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawAgreement.
Appears in 5 contracts
Samples: Shareholders Agreement (ZKH Group LTD), Shareholders Agreement (ZKH Group LTD), Shareholders Agreement (ZKH Group LTD)
Drag Along Right. Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect to In the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect event the holders of a Third Party Salemajority of the Company’s equity securities then outstanding (the “Majority Shareholders”) determine to sell or otherwise dispose of all or substantially all of the assets of the Company or all or fifty percent (50%) or more of the capital stock of the Company in each case in a transaction constituting a change in control of the Company, thento any non-Affiliate(s) of the Company or any of the Majority Shareholders, upon or to cause the demand Company to merge with or into or consolidate with any non-Affiliate(s) of the Company or any Selling Fortress Entity participating in such Third Party Sale of the Majority Shareholders (in each such entity’s sole discretioncase, the “Buyer”) in a bona fide negotiated transaction (a “Sale”), such Holder the Optionee, including any Permitted Transferees, shall sell be obligated to and shall upon the written request of the Majority Shareholders (subject to Section 6): (a) sell, transfer and deliver, or cause to be sold, transferred and delivered, to the respective Third Party the number of whole Holder’s Buyer, his or her Issued Shares (rounded upwards including for this purpose all of such Optionee’s or downwards, his or her Permitted Transferee’s Issued Shares that presently or as applicable), whether or not a result of any such transaction may be acquired upon the restrictions on Transfer exercise of Common Stock have lapsed, equal to options (following the product of (x) the total number of Holder’s Shares held by such Holder on the date payment of the Drag-Along Notice (as defined belowexercise price therefor)) and (y) the Third Party Sale Percentage, at the same price and on substantially the same terms applicable to the Majority Shareholders (with appropriate adjustments to reflect the conversion of convertible securities, the redemption of redeemable securities and conditions the exercise of exercisable securities as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that well as the Company may, in its sole discretion, accelerate the vesting relative preferences and priorities of any unvested Holder’s Sharespreferred stock); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (Bb) the liability execute and deliver such instruments of conveyance and transfer and take such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of other action, including voting such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Issued Shares in favor of such any Sale proposed by the Majority Shareholders and executing any purchase agreements, merger agreements, indemnity agreements, escrow agreements or related documents, as the Majority Shareholders or the Buyer may reasonably require in order to carry out the terms and not to exercise any rights provisions of appraisal or dissent afforded this Section 10. The obligations under applicable lawthis Section 10 shall terminate in accordance with Section 12(a).
Appears in 5 contracts
Samples: Non Qualified Stock Option Agreement, Incentive Stock Option Agreement, Incentive Stock Option Agreement (Demandware Inc)
Drag Along Right. Notwithstanding (a) If one or more members of the Principal Investor Groups propose to Transfer all of their Equity Securities, representing more than 50% of the Voting Securities of the Company, and, for so long as such a Transfer requires any approval hereunder, such Transfer has been so approved, then if requested by the Stockholder(s) Transferring such Equity Securities (the “Section 3.4 Transferring Stockholder(s)”), each other provision hereofStockholder (each, if a “Selling Stockholder”) shall be required to sell all of the Equity Securities held by it of the same type as any Holder has not exercised of the Equity Securities to be Transferred (or then convertible into any such type).
(b) The consideration to be received by a Selling Stockholder shall be the same form and amount of consideration per share to be received by the Section 3.4 Transferring Stockholder(s), and the terms and conditions of such sale shall be the same as those upon which the Section 3.4 Transferring Stockholder(s) sells its Tag-Along Right Equity Securities. In connection with respect the transaction contemplated by Section 3.4(a) (the “Drag Transaction”), each Selling Stockholder will agree to make or agree to the maximum number same customary representations, covenants, indemnities and agreements as the Section 3.4 Transferring Stockholder(s) so long as they are made severally and not jointly and the liabilities thereunder are borne on a pro rata basis based on the consideration to be received by each Stockholder; provided, that (i) any general indemnity given by the Section 3.4 Transferring Stockholder(s), applicable to liabilities not specific to the Section 3.4 Transferring Stockholder(s), to the purchaser in connection with such sale shall be apportioned among the Selling Stockholders according to the consideration received by each Selling Stockholder and shall not exceed such Selling Stockholder’s net proceeds from the sale, (ii) that any representation relating specifically to a Selling Stockholder and/or its Equity Securities shall be made only by that Selling Stockholder, and (iii) in no event shall any Stockholder be obligated to agree to any non-competition covenant or other similar agreement as a condition of Holder’s Shares participating in such Transfer.
(c) The fees and expenses incurred in connection with a sale under this Section 3.4 and for which such Holder is permitted the benefit of all Stockholders (pursuant it being understood that costs incurred by or on behalf of a Stockholder for his, her or its sole benefit will not be considered to Section 2(b)(ii)(B) above) be for the benefit of all Stockholders), to exercise such Tag-Along Right the extent not paid or reimbursed by the Company or the Transferee or acquiring Person, shall be shared by all the Stockholders on a pro rata basis, based on the consideration received by each Stockholder in respect of a Third Party Sale, then, upon its Equity Securities; provided that no Stockholder shall be obligated to make any out-of-pocket expenditure prior to the demand consummation of the transaction consummated pursuant to this Section 3.4 (excluding de minimis expenditures).
(d) The Section 3.4 Transferring Stockholder(s) shall provide written notice (the “Drag Along Notice”) to each other Selling Stockholder of any proposed Drag Transaction as soon as practicable following its exercise of the rights provided in Section 3.4(a). The Drag Along Notice shall set forth the consideration to be paid by the purchaser for the securities, the identity of the purchaser and the material terms of the Drag Transaction.
(e) If any holders of Equity Securities of any class are given an option as to the form and amount of consideration to be received in the Drag Transaction, all holders of Equity Securities of such class must be given the same option.
(f) Any Selling Fortress Entity participating in such Third Party Sale Stockholder whose assets (in each such entity’s sole discretion“Plan Assets”) constitute assets of one or more employee benefit plans and are subject to Part IV of Title I of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), such Holder shall not be obligated to sell to any Person to whom the respective Third Party sale of any Equity Securities would constitute a non-exempt “prohibited transaction” within the number meaning of whole Holder’s Shares (rounded upwards ERISA or downwardsthe Code, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each if so requested by the Section 3.4 Transferring Stockholder(s): (i) such Holder Selling Stockholder shall have taken commercially reasonable efforts to (x) structure its sale of Equity Securities so as not be permitted to sell any unvested Holder’s Shares constitute a non-exempt “prohibited transaction” or (provided that y) obtain a ruling from the Company may, in its sole discretion, accelerate Department of Labor to the vesting of any unvested Holder’s Shares); provided further effect that such Selling Fortress Entity shall use its reasonable, good faith efforts sale (as originally proposed or as restructured pursuant to provide that clause (Ai)(x)) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is does not constitute a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims non-exempt “prohibited transaction” and (Bii) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder Selling Stockholder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided have delivered an opinion of counsel (which opinion and counsel are reasonably satisfactory to the Section 3.4 Transferring Stockholder(s)) to the effect that such sale (as originally proposed or as restructured pursuant to clause (i)(x)) would constitute a non-exempt “prohibited transaction.”
(g) Upon the Third Party Sale is not consummation of the Drag Transaction and delivery by any Selling Stockholder of the duly endorsed certificate or certificates representing the Equity Securities held by such Selling Stockholder to be sold together with a stock power duly executed in violation of applicable federal and state securities or other laws orblank, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice acquiring Person shall remit directly to such Holder shall indemnify such Holder Selling Stockholder, by wire transfer of immediately available funds, the consideration for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawsecurities sold pursuant thereto.
Appears in 4 contracts
Samples: Stockholders Agreement (Hertz Global Holdings Inc), Stockholders Agreement (Hertz Global Holdings Inc), Stockholders Agreement (Hertz Global Holdings Inc)
Drag Along Right. Notwithstanding (a) If at any other provision hereoftime during a Marketing Period, if any Holder has not exercised its Tagthe Offerors (for the purposes of this Section 9.03, the “Drag-Along Right Sellers”) enter into a binding, definitive agreement complying with the terms of this Section 9.03 to Transfer all or substantially all of the Units (or Echo Shares) then outstanding (whether or not such Units (or Echo Shares) are held by the Drag-Along Sellers) to a third party (the “Drag-Along Transferee”) in connection with a Company Sale that was treated as a ROFO Sale and for which the Drag-Along Sellers had included in the Initial Offer Notice a statement that such ROFO Sale would be a Drag-Along Sale (whether structured as a sale of Units (or Echo Shares), merger or other business combination) (a “Drag-Along Sale”), the Drag-Along Sellers may at their option require each other Member (each, a “Dragged Member”) to, (x) Transfer all (but not less than all) Units held by such Member (or Echo Shares, which shall include, for all purposes of this Section 9.03, any Equity Securities of Echo convertible, exchangeable into or exercisable for Echo Shares in connection with or upon consummation of such Drag-Along Sale as set forth in Section 9.03(g)), in the case Echo is the Dragged Member to the Drag-Along Transferee for the same consideration (based on the pro rata Membership Percentages of the Members) and, (y)
(1) vote such Dragged Member’s Units (and Echo Shares, in the case Echo is the Dragged Member) in favor thereof, and otherwise consent to and raise no objection to such Drag-Along Sale, and waive any dissenters’ rights, appraisal rights or similar rights that such Dragged Member may have in connection therewith and (2) be a party to the definitive agreement(s) governing the terms and conditions of such Drag-Along Sale on the same terms and conditions as the Drag-Along Sellers (except as provided in Section 9.03(c)); provided, that to the extent Echo is the Dragged Member, the holders of Echo Shares will be entitled, in the sole discretion of Echo, to substitute for the Units to be Transferred by Echo in such Drag-Along Sale all of Echo’s capital stock for the same consideration that would have otherwise been payable in respect of such Units.
(b) The Drag-Along Sellers shall provide notice of such Drag-Along Sale to the Dragged Members (a “Drag-Along Sale Notice”) not later than fifteen (15) days prior to the consummation of the proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Transferee, the consideration proposed to be paid in connection with the Drag-Along Sale (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale, which shall be no less favorable in the aggregate to the Dragged Members than as set forth in the Initial Offer Notice. The Drag-Along Sellers will promptly notify the Dragged Members in writing in connection with any change in the material terms and conditions of the Drag-Along Sale; provided, that without complying again with the procedures set forth in Section 9.02 with respect to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tagany proposed Drag-Along Right Sale, such modified terms shall be no less favorable in the aggregate to the Dragged Members (or more favorable to the Drag-Along Sellers) then the terms set forth in the Initial Offer Notice.
(c) The Dragged Members shall be required to participate in the Drag-Along Sale on the same terms and conditions as the Drag-Along Sellers as set forth in the Drag-Along Sale Notice by entering into the agreement(s) governing the terms and conditions of such Drag-Along Sale (the terms and conditions of which shall be consistent with those provided in such Drag-Along Sale Notice as may be modified from time to time with notice as provided herein); provided, that (i) the Dragged Members shall not be required to agree to any non-compete, non-solicit, no hire or similar post-closing covenant that restricts the Dragged Members’ business and operations (but shall, for the avoidance of doubt, be required to agree to customary confidentiality and further assurances covenants that do not restrict the Dragged Members’ business or operations in any material respect), (ii) the Dragged Members’ indemnification obligations in respect of a Third Party the Company’s representations and warranties shall be (A) joint and several with each other and the Drag-Along Sellers, and (B) pro rata based on such Dragged Member’s Membership Percentage, (iii) the Dragged Members shall be required to bear their pro rata share (based on the aggregate consideration received in respect of the Units (or Unit equivalents based on the Echo Ratio) Transferred by such Member) of any escrow, holdback or adjustment in purchase price and any reasonable out-of-pocket transaction expenses incurred in connection with the Drag-Along Sale (provided, that the Dragged Members and the Company shall only be required to bear the reasonable expenses of one counsel for the Dragged Members), to the extent such expenses are incurred for the benefit of the Members participating in the Drag-Along Sale, and are not otherwise paid by the Company or the purchaser and the Drag-Along Sale is consummated; (iv) (A) Dragged Members will be required to make individual representations, warranties, covenants and other agreements as to the unencumbered title to its Units (or Echo Shares) and the power, authority and legal right to Transfer such Units (or Echo Shares) and the absence of any adverse claim with respect to such Units and (B) be liable as to such representations, warranties, covenants and other agreements; (v) Echo shall not be required to participate in such Drag-Along Sale if such transaction involves, or could reasonably be expected to be treated in whole or in part for U.S. federal income tax purposes as, a disposition by Echo of any of its Equity Securities in the Company and (vi) Echo, on behalf of the Echo Shareholders, may substitute all of the Echo Shares in lieu of Units as described in Section 9.03(a); provided further that, no Dragged Member’s liability in connection with a Drag-Along Sale may exceed the proceeds payable to such Dragged Member in the Drag-Along Sale.
(d) In a Drag-Along Sale, the Dragged Members shall be required to tender their Units (or Echo Shares) as set forth below. The price payable in a Drag-Along Sale shall be the Drag-Along Sale Price. If the consideration being paid in such Drag-Along Sale includes any non-cash consideration then, upon at the demand election of any Selling Fortress Entity participating the Drag-Along Sellers (or with respect to itself, Echo or the MCK Members, to the extent it is a Dragged Member), the Dragged Members shall receive either (i) their pro rata share of such non-cash consideration or (ii) cash (which cash may be paid by the Drag-Along Transferee or by the Drag-Along Sellers) in an amount equal to the Fair Market Value of their pro rata share of such Third Party Sale non-cash consideration (in each case based on the aggregate consideration received by each of the Drag-Along Sellers in such entity’s sole discretionDrag-Along Sale), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares . Not later than five (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x5) the total number of Holder’s Shares held by such Holder on Business Days after the date of the Drag-Along Sale Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect Drag-Along Sale, each Dragged Member shall deliver to such Holder’s own ownership a representative of the HolderDrag-Along Sellers designated in the Drag-Along Sale Notice (x) a limited power-of-attorney authorizing the Drag-Along Sellers or their representative to Transfer such Dragged Member’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and Units (Bor Echo Shares) the liability of such Holder with respect to any representation and warranty made in connection accordance with the Third Party Sale is the several liability terms of such Holder this Agreement (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided furtherprovided, that a Holder H&F shall not be obligated to participate deliver any power-of-attorney), the Drag-Along Sale Notice and the agreement(s) governing the terms and conditions of the Drag-Along Sale and (y) wire transfer or other instructions for payment or delivery of the consideration to be received by the Dragged Members in such Drag-Along Sale.
(e) Within one Business Day following the consummation of a Drag-Along Sale, the Drag-Along Sellers shall give notice thereof to the Dragged Members and shall furnish such other evidence of the completion and time of completion of such Transfer and the terms thereof as may be reasonably requested by such Dragged Member. In addition, within one Business Day following the consummation of a Drag-Along Sale, the Drag-Along Sellers shall remit to each Dragged Member the total consideration (any Third Party Sale cash portion of which is to be paid by wire transfer in accordance with each Dragged Member’s wire transfer instructions) for the Units (or Echo Shares) of such Dragged Member Transferred pursuant hereto.
(f) Notwithstanding anything contained in this Section 9.03, there shall be no liability on the part of the Drag-Along Sellers to the Dragged Members (other than the obligation to return the limited power-of-attorney received by the Drag-Along Sellers (if applicable)) or any other Person if the Transfer of Units (or Echo Shares) pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale 9.03 is not in violation consummated for whatever reason, regardless of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to whether the matters contemplated by this proviso, each Selling Fortress Entity who has Drag-Along Sellers have delivered a Drag-Along Sale Notice.
(g) In the event of any Drag-Along Sale, each holder of Equity Securities of Echo will be deemed to have exercised, converted or exchanged any vested and exercisable options, warrants or convertible securities immediately prior to the consummation of the Drag-Along Sale to the extent necessary to sell Echo Shares to the Drag-Along Buyer (the “Drag-Along Buyer”), except to the extent permitted under the terms of any such option, warrant or convertible security and agreed to by the Drag-Along Buyer. All Units issuable upon such exercise, conversion or exchange pursuant to Section 3.03(c) will be deemed issued and shall be included as “Echo Shares” for all purposes of this Section 9.03. In the event that options, warrants or convertible securities are deemed exercised pursuant to the preceding sentence, payment of any purchase or exercise price, if applicable, and minimum statutory withholding tax amount, if any, shall be satisfied through payment of Echo Shares otherwise deliverable upon such exercise, conversion, or exchange. If any holder of Equity Securities of Echo sells options, warrants or convertible securities in any Drag-Along Sale, such holder of Equity Securities of Echo shall receive in exchange for such options, warrants or convertible securities consideration equal to the amount (if greater than zero) determined by multiplying (a) the same purchase price per share for Echo Shares as those Units sold to the Drag-Along Buyer and specified in the Drag-Along Sale Notice in such Transfer less the exercise, exchange or conversion price, if any, per share of such option, warrant or convertible security by (b) the number of Echo Shares issuable upon exercise, conversion or exchange of such option, warrant or convertible security (to the extent exercisable, convertible or exchangeable at the time of such Holder shall indemnify such Holder Transfer), subject to reduction for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees tax or other amounts required to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded be withheld under applicable law.
(h) The provisions of this Section 9.03 shall terminate upon the consummation of a Qualified IPO.
Appears in 4 contracts
Samples: Limited Liability Company Agreement (PF2 SpinCo, Inc.), Limited Liability Company Agreement (Change Healthcare Inc.), Limited Liability Company Agreement (Change Healthcare Inc.)
Drag Along Right. Notwithstanding any other provision hereofIn the event of an offer to buy all the Shares in the Company, if any Holder has put forward by an external party not being a Shareholder, one or several Shareholders who together represents more than two thirds (2/3) of the total amount of Shares in the Company shall have the right to demand the sale of all the outstanding Shares for cash, cash equivalents or consideration shares listed on an internationally recognised stock exchange in accordance with the terms of this Clause 4.4 (the "Drag-along Right"). The Drag-along Right is exercised its Tag-Along Right with respect by written notice (a "Buyout Notice") to the maximum number Company and the other Shareholders, notifying the other Shareholders of Holder’s the bona fide offer to purchase all the outstanding Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) and that the Shareholders wishes to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along along Right. Upon receipt of a Buyout Notice, each Shareholder receiving such notice shall be under an immediate obligation to (i) sell all its Shares in the transaction contemplated by the Buyout Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as conditions; and (ii) otherwise to take all necessary action to cause the consummation of such Selling Fortress Entity has agreed to with transaction, including voting its Shares in favour of such Third Party; providedtransaction, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only accepting reasonable representation and warranty which such Holder shall be required to make warranties, non-competition restrictions and other undertakings in connection with such sale and not exercising any appraisal rights in connection therewith. In the Third Party Sale is a representation and warranty event that the transaction contemplated by the Buyout Notice has not been completed within 90 days after the date of delivery of the Buyout Notice, the obligations of the Shareholders under this Clause 4.4 with respect to such Holder’s own ownership Buyout Notice shall terminate, subject, however, to the right to deliver further Buyout Notices. Potential buyers of all the outstanding shares in the Company shall, subject to undertaking satisfactory confidentiality obligations, be given the opportunity to perform a legal, financial, technical and commercial due diligence review of the Holder’s Shares Company, as well as access to be sold by it relevant information and its ability to convey title thereto free documentation. All costs and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made expenses in connection with such transfer shall be borne by the Third Shareholders on a pro rata basis, to the extent that such costs and expenses are not borne by the purchaser according to the relevant sale and purchase agreement. For avoidance of doubt, any individual cost including legal and advisory fees will be borne by the relevant Shareholder. If any of the Shareholders fail to comply with the terms of this Clause 4.4 (a "Defaulting Party"), the Company represented by the Chairman of the board of directors shall be constituted the agent of each Defaulting Party Sale is for the several liability sale of the Shares in accordance with the Buy-out Notice and the Chairman of the board of directors may authorise any person to execute and deliver on behalf of such Holder (Defaulting Party the necessary transfer documents and not joint with any other person) the Company may receive the purchase consideration in trust for each Defaulting Party and that cause the proposed purchaser to be registered as the holder of such liability is limited Shares. The receipt by the Company of the purchase consideration shall constitute a good and valid discharge of the obligations of the proposed purchaser to pay such purchaser price to the amount Defaulting Party. The Company shall not pay the consideration to the Defaulting Party until it has delivered to the Company a written confirmation of proceeds actually received by such Holder its acceptance of the transaction as set out in the Third Party Sale; provided further, that Buy-out Notice. Failure to comply with this Clause 4.4 shall always be considered a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion material breach of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawAgreement.
Appears in 4 contracts
Samples: Shareholder Agreements, Shareholder Agreements, Shareholder Agreements
Drag Along Right. Notwithstanding any other provision hereofIn the event of an offer to buy all the Shares in the Company, if any Holder has put forward by an external party not being a Shareholder, one or several Shareholders who together represents more than two thirds (2/3) of the total amount of Shares in the Company shall have the right to demand the sale of all the outstanding Shares for cash, cash equivalents or consideration shares listed on an internationally recognised stock exchange in accordance with the terms of this Clause 4.4 (the "Drag-along Right"). The Drag-along Right is exercised its Tag-Along Right with respect by written notice (a "Buyout Notice") to the maximum number Company and the other Shareholders, notifying the other Shareholders of Holder’s the bona fide offer to purchase all the outstanding Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) and that the Shareholders wishes to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along along Right. Upon receipt of a Buyout Notice, each Shareholder receiving such notice shall be under an immediate obligation to (i) sell all its Shares in the transaction contemplated by the Buyout Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as conditions; and (ii) otherwise to take all necessary action to cause the consummation of such Selling Fortress Entity has agreed to with transaction, including voting its Shares in favour of such Third Party; providedtransaction, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only accepting reasonable representation and warranty which such Holder shall be required to make warranties, non-competition restrictions and other undertakings in connection with such sale and not exercising any appraisal rights in connection therewith. In the Third Party Sale is a representation and warranty event that the transaction contemplated by the Buyout Notice has not been completed within 90 days after the date of delivery of the Buyout Notice, the obligations of the Shareholders under this Clause 4.4 with respect to such Holder’s own ownership Buyout Notice shall terminate, subject, however, to the right to deliver further Buyout Notices. Potential buyers of all the outstanding shares in the Company shall, subject to undertaking satisfactory confidentiality obligations, be given the opportunity to perform a legal, financial, technical and commercial due diligence review of the Holder’s Shares Company, as well as access to be sold by it relevant information and its ability to convey title thereto free documentation. All costs and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made expenses in connection with such transfer shall be borne by the Third Shareholders on a pro rata basis, to the extent that such costs and expenses are not borne by the purchaser according to the relevant sale and purchase agreement. For avoidance of doubt, any individual cost including legal and advisory fees will be borne by the relevant Shareholder. If any of the Shareholders fail to comply with the terms of this Clause 4.4 (a "Defaulting Party"), the Company represented by the Chairman of the board of directors shall be constituted the agent of each Defaulting Party Sale is for the several liability sale of the Shares in accordance with the Buy-out Notice and the Chairman of the board of directors may authorise any person to execute and deliver on behalf of such Holder (Defaulting Party the necessary transfer documents and not joint with any other person) the Company may receive the purchase consideration in trust for each Defaulting Party and that cause the proposed purchaser to be registered as the holder of such liability is limited Shares. The receipt by the Company of the purchase consideration shall constitute a good and valid discharge of the obligations of the proposed purchaser to pay such purchaser price to the amount Defaulting Party. The Company shall not pay the consideration to the Defaulting Party until it has delivered to the Company a written confirmation of proceeds actually received by such Holder its acceptance of the transaction as set out in the Third Party Sale; provided further, that Buy-out Notice. Failure to comply with this Clause 4.4 shall always be considered a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion material breach of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawAgreement.
Appears in 3 contracts
Samples: Shareholder Agreements, Shareholder Agreements, Shareholder Agreements
Drag Along Right. Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect to In the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect event the holders of a Third Party Salemajority of the Company’s equity securities then outstanding (the “Majority Shareholders”) determine to sell or otherwise dispose of all or substantially all of the assets of the Company or all or fifty percent (50%) or more of the capital stock of the Company in each case in a transaction constituting a change in control of the Company, thento any non-Affiliate(s) of the Company or any of the Majority Shareholders, upon or to cause the demand Company to merge with or into or consolidate with any non-Affiliate(s) of the Company or any Selling Fortress Entity participating in such Third Party Sale of the Majority Shareholders (in each such entity’s sole discretioncase, the “Buyer”) in a bona fide negotiated transaction (a “Sale”), such Holder the Optionee, including any Permitted Transferees, shall sell be obligated to and shall upon the written request of a Majority Shareholders (subject to Section 6): (a) sell, transfer and deliver, or cause to be sold, transferred and delivered, to the respective Third Party the number of whole Holder’s Buyer, his or her Issued Shares (rounded upwards including for this purpose all of such Optionee’s or downwards, his or her Permitted Transferee’s Issued Shares that presently or as applicable), whether or not a result of any such transaction may be acquired upon the restrictions on Transfer exercise of Common Stock have lapsed, equal to options (following the product of (x) the total number of Holder’s Shares held by such Holder on the date payment of the Drag-Along Notice (as defined belowexercise price therefor)) and (y) the Third Party Sale Percentage, at the same price and on substantially the same terms applicable to the Majority Shareholders (with appropriate adjustments to reflect the conversion of convertible securities, the redemption of redeemable securities and conditions the exercise of exercisable securities as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that well as the Company may, in its sole discretion, accelerate the vesting relative preferences and priorities of any unvested Holder’s Sharespreferred stock); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (Bb) the liability execute and deliver such instruments of conveyance and transfer and take such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of other action, including voting such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Issued Shares in favor of such any Sale proposed by the Majority Shareholders and executing any purchase agreements, merger agreements, indemnity agreements, escrow agreements or related documents, as the Majority Shareholders or the Buyer may reasonably require in order to carry out the terms and not to exercise any rights provisions of appraisal or dissent afforded this Section 11. The obligations under applicable lawthis Section 11 shall terminate in accordance with Section 13(a).
Appears in 3 contracts
Samples: Incentive Stock Option Agreement (YogaWorks, Inc.), Incentive Stock Option Agreement (WII Components, Inc.), Incentive Stock Option Agreement (WII Components, Inc.)
Drag Along Right. Notwithstanding (a) If at any other provision hereof, if any Holder has not exercised its Tagtime one or more Stockholder(s) propose to transfer Shares representing over 50% of all then-Along Right with respect to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer outstanding shares of Common Stock to any Person, and, such Stockholder(s) (the "DRAG-ALONG RIGHTHOLDERS") have lapsedreceived a bona fide, equal arm's length offer from an Offeror to purchase (including a purchase by merger, consolidation or similar transaction) all of the product outstanding Shares or all or substantially all of the assets of Parent, the Drag-Along Rightholders may send written notice (xthe "DRAG-ALONG NOTICE") to Parent and the total number other Stockholders (such other Stockholders, collectively, the "DRAG-ALONG SELLERS") notifying them they will be required to sell all (but not less than all) of Holder’s their Shares held in such sale. Upon receipt of a Drag-Along Notice, each Drag-Along Seller receiving such notice shall be obligated to (i) sell all of its Shares in the transaction (including a sale or merger, consolidation or similar transaction) contemplated by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to the Drag-Along Rightholders (including payment of its pro rata share of all costs associated with such Third Party; providedtransaction) and (ii) otherwise take all action (or refrain from taking certain actions) necessary to cause the consummation of such transaction, howeverincluding not exercising any appraisal rights in connection therewith. Each Drag-Along Seller further agrees to take all actions (including executing documents) in connection with the consummation of the proposed transaction as may reasonably be requested of it by the Drag-Along Rightholders.
(b) In connection with any sale pursuant to this Section 3.3(a), that each such Holder the Drag-Along Seller shall not be permitted make to sell any unvested Holder’s Shares (provided that the Company mayOfferor the same representations, in its sole discretionwarranties, accelerate covenants, indemnities and agreements as the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to Drag-Along Rightholders make in connection with the Third Party Sale is a representation proposed transfer (except that in the case of representations, warranties, covenants, indemnities and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited agreements pertaining specifically to the amount of proceeds actually received by such Holder in the Third Party Sale; provided furtherDrag-Along Rightholders, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice Seller shall make the comparable representations, warranties, covenants, indemnities and agreements pertaining specifically to itself); provided that all representations, warranties and indemnities shall be made by the transferring Drag-Along Rightholders and such Holder Drag-Along Seller severally and not jointly and that the liability of the transferring Drag-Along Rightholders and such Drag-Along Seller thereunder shall indemnify such Holder be borne by each of them on a pro rata basis. The Drag-Along Seller shall receive the same type and amount of consideration (and rights) per Share for any such violation. If the Third Party Sale corresponding class or series of stock (on an as converted basis, if applicable) and the same type and amount of consideration (and rights) for each type of Common Stock Equivalent, in each case, as is paid or delivered to the Drag-Along Rightholders in the form of a merger transaction, each Holder agrees sale pursuant to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawSection 3.3(a).
Appears in 3 contracts
Samples: Stockholders Agreement (TRW Automotive Holdings Corp), Stockholders Agreement (TRW Automotive Inc), Stockholders Agreement (TRW Automotive Inc)
Drag Along Right. Notwithstanding (a) In the event that any Key Holder owns more than fifty percent (50%) of the Company’s issued and outstanding capital stock and such Key Holder desires to accept a bona fide offer (a "Purchase Offer") from any person or persons, other provision hereofthan an Affiliate or another Stockholder, if any Holder has not exercised its Tag-Along Right with respect to purchase all (a "Divestiture") the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer shares of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares then held by such Key Holder, then such Key Holder shall promptly deliver to each of the other Stockholders a written notice (the "Purchase Offer Notice") stating such Key Holder’s intention to sell such shares pursuant to such Purchase Offer and setting forth the terms and conditions of such Purchase Offer, including, without limitation, the identity of the proposed purchaser and the amount and type of consideration to be paid therefor. The Purchase Offer Notice shall include a copy of any written offer, letter of intent, term sheet or contract of sale pertaining to the Purchase Offer.
(b) In connection with a Divestiture, any Key Holder owning more than fifty percent (50%) of the Company’s issued and outstanding capital stock shall have the right ("Drag Along Right") to require each other Stockholder to participate in such sale of Common Stock by such Key Holder on the date of terms and conditions set forth in the Drag-Along Purchase Offer Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on which shall be the same terms and conditions (on a per share basis) as are applicable to such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Key Holder’s Shares (provided that sale of shares of Common Stock to the Company may, proposed purchaser). Such Drag Along Right shall be exercisable by such Key Holder including in its sole discretion, accelerate Purchase Offer Notice a statement to the vesting of any unvested Holder’s Shares); provided further effect that such Selling Fortress Entity shall use Key Holder elects to exercise its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make Drag Along Right in connection with the Third Party Sale is a representation and warranty with respect proposed sale. At any time prior to the closing of such Holder’s own ownership sale, such Key Holder may withdraw its election to exercise its Drag Along Right upon written notice to the Stockholders.
(c) The closing of the Holderpurchase and sale of any shares of Common Stock to be sold pursuant to the Drag Along Right shall occur concurrently with the closing of the sale of the shares of the Common Stock by the Key Holder owning more than fifty percent (50%) of the Company’s Shares issued and outstanding capital stock, which shall be a date not less than sixty (60) days after the giving of the Purchase Offer Notice. At any such closing, each Stockholder shall deliver to the purchaser a certificate or certificates representing the number of shares of Common Stock to be sold by it such Stockholder, duly endorsed in blank or accompanied by a duly executed stock power in blank, with signatures duly guaranteed and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder all requisite stock transfer stamps affixed thereto. All Stockholders shall not be obligated to participate in any Third Party Sale pursuant to treated equally under this Section 2(b)(iii) unless such Holder is provided 5.5. It shall be a condition of the obligation to sell under this Section 5.5 that all facts and circumstances and all material aspects of any transaction under this Section 5.5 shall be disclosed. The provisions of this Section 5.5 shall terminate upon an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawIPO.
Appears in 3 contracts
Samples: Stockholders’ Agreement (Acorn Energy, Inc.), Stockholders’ Agreement (Acorn Energy, Inc.), Stockholders' Agreement (Acorn Energy, Inc.)
Drag Along Right. Notwithstanding any other provision hereof, if any (i) If the Required Holder has not exercised its Tag-Along Right with respect to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) approves the sale of the Company, whether by merger, consolidation, sale of outstanding capital stock, sale of all or substantially all of its assets or otherwise (any of the foregoing, an “Approved Sale”), (1) Purchaser shall consent to, vote for and raise no objections against, and waive dissenters and appraisal rights (if any) with respect to, the Approved Sale, (2) if the Approved Sale is structured as a sale of stock, Purchaser shall agree to sell and shall be permitted to sell all of Purchaser’s Shares on the terms and conditions approved by the Required Holder, and (3) if the Approved Sale includes the sale, exchange, redemption, cancellation or other disposition of securities convertible into or exchangeable for capital stock of the Company, or options, warrants or other rights to purchase such capital stock or securities, Purchaser shall sell, exchange, redeem, agree to cancel or otherwise dispose of such securities or options, warrants or other rights on the terms and conditions approved by the Required Holder. In order to effect the covenant set forth in clause (1) of the immediately preceding sentence, Purchaser shall be deemed to have granted to the Company with respect to all of Purchaser’s Shares an irrevocable proxy (which is deemed to be coupled with an interest) with respect to any stockholder vote or action by written consent solely to effect such Approved Sale in compliance with this Section 3(d). Purchaser shall take all necessary and desirable actions in connection with the consummation of an Approved Sale. As used herein, the term “Required Holder” means, as of any date, any one or more of the Xxxxxx Parties.
(ii) The obligations of Purchaser with respect to an Approved Sale are subject to the satisfaction of the conditions that: (1) upon the consummation of the Approved Sale, all of the holders of Common Stock shall receive the same form and amount of consideration per share of Common Stock, or if any holder of Common Stock is given an option as to the form and amount of consideration to be received in respect of Common Stock, all holders of Common Stock shall be given the same option; and (2) in the case of a holder of any securities referred to in clause (3) of paragraph (i) above, (I) in the event such securities are vested, the holder shall receive in such Approved Sale, unless otherwise provided in the terms of any agreement or instrument governing or evidencing such security, either (x) the same securities or other property that such holder would have received if such holder had converted, exchanged or exercised such security immediately prior to such Approved Sale (after taking into account the conversion, exchange or exercise price applying to such security and any applicable tax obligations of the holder in connection with such conversion, exchange or exercise) or (y) a security convertible or exchangeable for, or option, warrant or right to purchase, capital stock or other securities of a successor entity having substantially equivalent value, or (II) in the Third Party Sale Percentagecase where such securities are not vested, at unless otherwise provided in the terms of any agreement or instrument governing or evidencing such security, such securities shall be cancelled.
(iii) Purchaser shall be required to make substantially the same price representations and on warranties (but only to the same terms extent that such representations and conditions warranties relate to Purchaser’s ownership of Shares and his or her authority to execute such documents), customary covenants and other agreements, to the extent reasonably related to the Approved Sale, as such Selling Fortress Entity the Required Holder has agreed to make in connection with the proposed Approved Sale. Purchaser acknowledges that his or her pro rata share (based upon the number of Shares owned by such holder) of the aggregate proceeds of an Approved Sale may be reduced by transaction expenses related to such Approved Sale. Purchaser shall be obligated to join on a pro rata basis in any indemnification or other obligations that the Required Holder agrees to provide in connection with such Third PartyApproved Sale; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder Purchaser shall not be obligated in connection with such Approved Sale to participate in agree to indemnify or hold harmless any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion person with respect to (1) the matters contemplated representations and warranties of any other holder of Common Stock regarding its ownership of Common Stock or (2) an amount in excess of the net proceeds received by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to Purchaser in connection with such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawApproved Sale.
Appears in 3 contracts
Samples: Director Nonqualified Stock Option Agreement (Sunshine Silver Mining & Refining Corp), Executive Nonqualified Stock Option Agreement (Sunshine Silver Mining & Refining Corp), Executive Nonqualified Stock Option Agreement (SUNSHINE SILVER MINES Corp)
Drag Along Right. Notwithstanding (i) Following the Third Closing, so long as Warburg Pincus Owns at least 50% of the outstanding Common Stock, if at any time and from time to time after the date of this Agreement, Warburg Pincus wishes to (x) Transfer in a bona fide arms' length sale all of its Shares to any Person or Persons who are non-Affiliates of the Company or Warburg Pincus, (y) approve any merger of the Company with or into any other provision hereofPerson who is a non-Affiliate of the Company or Warburg Pincus, if or (z) approve any Holder has not exercised its Tagsale of all or substantially all of the Company's assets to any Person or Persons who are non-Along Right with respect to Affiliates of the maximum number Company or Warburg Pincus (for purposes of Holder’s Shares for which such Holder is permitted (pursuant to this Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion3(d), such Holder Person or Persons are referred to as the "Proposed Transferee"), Warburg Pincus shall have the right (for purposes of this Section 3(d), the "Drag-Along Right") to (A) in the case of a Transfer of the type referred to in clause (x), require each other Investor to sell to the respective Third Party the number Proposed Transferee all of whole Holder’s his or its Shares (rounded upwards including any warrants or downwardsoptions to acquire Shares) for the same per share consideration as proposed to be received by Warburg Pincus (less, as applicablein the case of options or warrants, the exercise price for such options or warrants) then Owned by such Investor or (B) in the case of a merger or sale of assets referred to in clauses (y) or (z), whether require each other Investor to vote all Shares then Owned by such other Investor in favor of such transaction and to waive any appraisal or not similar rights. Each Investor agrees to take all steps necessary to enable him or it to comply with the restrictions on Transfer provisions of Common Stock have lapsedthis Section 3(d) to facilitate the Warburg Pincus' exercise of a Drag-Along Right.
(ii) To exercise a Drag-Along Right, equal to the product Warburg Pincus shall give each other Investor a written notice (for purposes of this Section 3(d), a "Drag-Along Notice") containing (x) the total number name and address of Holder’s the Proposed Transferee and (y) the proposed purchase price, terms of payment and other material terms and conditions of the Proposed Transferee's offer. Each other Investor shall thereafter be obligated to sell or vote its Shares held (including any warrants or options Owned by such Holder on Investor), provided that the date sale to the Proposed Transferee is consummated within ninety (90) days of delivery of the Drag-Along Notice Notice. If the sale or merger is not consummated within such 90-day period, then each other Investor shall no longer be obligated to sell such Investor's Shares pursuant to that specific Drag-Along Right but shall remain subject to the provisions of this Section 3(d).
(as defined belowiii) Notwithstanding anything contained in this Section 3(d), in the event that all or a portion of the purchase price consists of securities and the sale of such securities to the Investors would require either a registration under the Securities Act or the preparation of a disclosure document pursuant to Regulation D under the Securities Act (yor any successor regulation) the Third Party Sale Percentageor a similar provision of any state securities law, then, at the same price and on option of Warburg Pincus, the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company mayInvestors may receive, in its sole discretionlieu of such securities, accelerate the vesting fair market value of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonablesecurities, as determined in good faith efforts to provide that (A) by the only representation and warranty which such Holder shall be required to make Board, in connection with cash from Warburg Pincus or the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of respective transferee, surviving Person or purchaser, as the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawcase may be.
Appears in 3 contracts
Samples: Stockholders Agreement (Bridgepoint Education Inc), Stockholders Agreement (Bridgepoint Education Inc), Stockholders Agreement (Bridgepoint Education Inc)
Drag Along Right. Notwithstanding (i) If at any time and from time to time following the Initial Closing Date, the Supermajority Holders desire to (i) Transfer in a bona fide arms’ length sale all of their Shares to any Person or Persons who are not Affiliates of the Company or the Supermajority Holders, (ii) approve any merger of the Company with or into any other provision hereofPerson who is not an Affiliate of the Company or the Supermajority Holders, if including any Holder has transaction that would constitute a Deemed Liquidation Event, or (iii) approve any sale of all or substantially all of the Company’s assets to any Person or Persons who are not exercised its TagAffiliates of the Company or the Supermajority Holders, including any transaction that would constitute a Deemed Liquidation Event (for purposes of this Section 3(e), such Person or Persons is referred to as the “Proposed Transferee”), the Supermajority Holders shall have the right (for purposes of this Section 3(e), the “Drag-Along Right with respect Right”), but not the obligation, (x) in the case of a Transfer of the type referred to in clause (i) above, to require each other Investor to sell to the maximum number Proposed Transferee all of Holdersuch Investor’s Shares for which such Holder is permitted the Per Share Drag-Along Purchase Price (pursuant as defined below), or (y) in the case of a merger or sale of assets or other Deemed Liquidation Event referred to Section 2(b)(ii)(Bin clauses (ii) or (iii) above, to require each other Investor to vote (or act by written consent with respect to) all Shares then Owned by such other Investor in favor of such transaction and to waive any dissenters’ rights, appraisal rights or similar rights such Investor may have under applicable law. Each Investor agrees to take all steps necessary to enable such Investor to comply with the provisions of this Section 3(e) to facilitate the Supermajority Holders’ exercise such Tagof a Drag-Along Right in respect of a Third Party SaleRight. As used herein, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale “Per Share Drag-Along Purchase Price” means: (in each such entity’s sole discretion), such Holder shall sell i) to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal extent that an Investor subject to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice Right is selling the same security being sold by any of the Supermajority Holders, the same consideration per share for such security as is proposed to be received by such Supermajority Holders (as defined belowless, in the case of Share Equivalents, the exercise price for such Share Equivalents), including equivalent rights to receive (when and if paid) a proportionate share of any deferred consideration, earn-out or escrow funds that may become available to such Supermajority Holders in connection with the proposed transaction; and (yii) to the Third Party Sale Percentageextent that an Investor subject to the Drag-Along Right is selling Common Stock (including any Share Equivalents) or a series of Preferred Stock other than any series of Preferred Stock being sold by the Supermajority Holders, at the same Per Share Drag-Along Purchase Price for each Share of Common Stock or Preferred Stock, as applicable, shall be equal to the implied equity value of each Share of Common Stock (less, in the case of Share Equivalents, the exercise price for such Share Equivalents) or Preferred Stock as applicable, as determined by reference to the per share price being paid for the Shares of Common Stock or Preferred Stock, as applicable, being sold by the Supermajority Holders and on after giving effect to all amounts payable to the same terms holders of Preferred Stock prior and conditions as such Selling Fortress Entity has agreed in preference to with such Third Partythe Common Stock pursuant to the liquidation preference provisions of the Certificate of Incorporation; provided, however, that each such Holder shall not be permitted if the per share price being paid for the Shares of Common Stock or Preferred Stock, as applicable, being sold by the Supermajority Holders includes any rights to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting receive a proportionate share of any unvested Holder’s Shares); provided further deferred consideration, earn-out or escrow funds that such Selling Fortress Entity shall use its reasonable, good faith efforts may become available to provide that (A) the only representation and warranty which such Holder shall be required to make Supermajority Holders in connection with the Third Party Sale is a representation and warranty with respect to proposed transaction, such Holder’s own ownership amounts shall be considered when determining the implied equity price of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear each Share of liensCommon Stock or Preferred Stock, encumbrances and adverse claims and (B) the liability as applicable, but any portion of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder included in the Third Party Sale; provided further, that a Holder implied equity price of each Share of Common Stock shall not be obligated paid to participate the Investors selling Common Stock, unless and until the portions of such amount included in any Third Party Sale the price per share being paid for the Preferred Stock are paid to the holders of the Preferred Stock and only to the extent that the holders of the Preferred Stock have received all amounts payable to the holders of Preferred Stock prior and in preference to the Common Stock pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion the liquidation preference provisions of counsel to the effect that the Third Party Sale is not in violation Certificate of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawIncorporation.
Appears in 3 contracts
Samples: Stockholders Agreement (CrowdStrike Holdings, Inc.), Stockholders Agreement (CrowdStrike Holdings, Inc.), Stockholders Agreement (CrowdStrike Holdings, Inc.)
Drag Along Right. Notwithstanding At any other provision hereoftime prior to the IPO Date, if any Holder has not exercised its TagInvestors constituting a Requisite Stockholder Majority (collectively, the “Drag-Along Right Sellers”) may require each other Investor (the “Required Sellers”) to participate in any Company Sale pursuant to which the Drag-Along Sellers are Transferring at least 90% of the then outstanding Shares then held by the Drag-Along Sellers for consideration consisting of cash and cash equivalents (an “Exit Sale”) to an Independent Third Party (a “Drag-Along Transferee”) in a bona fide arm’s length transaction or series of transactions (including pursuant to a stock sale, asset sale, recapitalization, tender offer, merger or other business combination transaction or otherwise) at the purchase price and upon the terms and subject to the conditions of the Exit Sale (all of which shall be set forth in the Drag-Along Notice as hereinafter defined). In connection with an Exit Sale, the Company may also require each Required Seller to vote in favor of such Exit Sale or act by written consent approving the same with respect to all Shares owned by such Required Seller, as necessary or desirable to authorize, approve and adopt the maximum number Exit Sale. Without limiting the foregoing, if an Exit Sale requires the approval of Holderthe Company’s Shares for which stockholders, each Investor shall waive any dissenters’ rights, appraisal rights or similar rights in connection with such Holder Exit Sale or Company Sale. In the event that a sale is permitted (proposed pursuant to this Section 2(b)(ii)(B) above) 3, all outstanding proposals to exercise such TagTransfer Shares shall immediately be withdrawn and no Transfer of Shares shall be consummated until the expiration of the time period provided for in Section 3(e). The consummation of an Exit Sale by the Drag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder Sellers shall sell be subject to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date sole discretion of the Drag-Along Notice Sellers, who shall have no liability or obligation whatsoever (as defined belowother than compliance with this Section 3) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make Required Sellers participating therein in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership Required Sellers’ Transfer of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawShares.
Appears in 3 contracts
Samples: Stockholders Agreement (Amc Entertainment Inc), Stockholders Agreement (Marquee Holdings Inc.), Stockholders Agreement (Amc Entertainment Inc)
Drag Along Right. Notwithstanding (i) If at any time and from time to time after the date of this Agreement, Warburg Pincus and its Affiliates together with any other provision hereofstockholders that would result in an aggregate ownership of greater than fifty percent (50%) of the Company’s voting power (the “Majority Holders”) desire to (i) Transfer in a bona fide arms’ length sale all of their Shares to any Person or Persons who are not Affiliates of the Company or the Majority Holders, if (ii) approve any Holder has merger of the Company with or into any other Person who is not exercised its Tagan Affiliate of the Company or the Majority Holders, including any transaction that would constitute a Deemed Liquidation Event, or (iii) approve any sale of all or substantially all of the Company’s assets to any Person or Persons who are not Affiliates of the Company or the Majority Holders, including any transaction that would constitute a Deemed Liquidation Event (for purposes of this Section 3(e) (Drag-Along Right with respect Right), such Person or Persons is referred to as the “Proposed Transferee”) (such Transfers set forth in (i), (ii) and (iii), a “Proposed Sale”), the Majority Holders shall have the right (for purposes of Section 3(e), the “Drag-Along Right”), but not the obligation, (x) in the case of a Transfer of the type referred to in clause (i), to require each other Investor to sell to the maximum number Proposed Transferee all of Holdersuch Investor’s Shares for which the Per Share Drag-Along Purchase Price (as defined below), or (y) in the case of a merger or sale of assets or other Deemed Liquidation Event referred to in clauses (ii) or (iii), to require each other Investor to vote (or act by written consent with respect to) all Shares then Owned by such Holder is permitted (pursuant other Investor in favor of such transaction and to waive any dissenters’ rights, appraisal rights or similar rights such Investor may have under applicable law. Each Investor agrees to take all steps necessary to enable such Investor to comply with the provisions of this Section 2(b)(ii)(B) above3(e) to facilitate the Majority Holders’ exercise such Tagof a Drag-Along Right in respect of a Third Party SaleRight. As used herein, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale “Per Share Drag-Along Purchase Price” means: (in each such entity’s sole discretion), such Holder shall sell i) to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal extent that an Investor subject to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice Right is selling the same security being sold by any of the Majority Holders, the same consideration per share for such security as is proposed to be received by such Majority Holders (as defined belowless, in the case of Share Equivalents, the exercise price for such Share Equivalents), including equivalent rights to receive (when and if paid) a proportionate share of any deferred consideration, earn-out or escrow funds that may become available to such Majority Holders in connection with the proposed transaction; and (yii) to the Third Party Sale Percentageextent that an Investor subject to the Drag-Along Right is selling Common Stock (including any Share Equivalents) or a series of Preferred Stock other than any series of Preferred Stock being sold by the Majority Holders, at the same Per Share Drag-Along Purchase Price for each Share of Common Stock or Preferred Stock, as applicable, shall be equal to the implied equity value of each Share of Common Stock (less, in the case of Share Equivalents, the exercise price for such Share Equivalents) or Preferred Stock as applicable, as determined by reference to the per share price being paid for the Shares of Common Stock or Preferred Stock, as applicable, being sold by the Majority Holders and on after giving effect to all amounts payable to the same terms holders of Preferred Stock prior and conditions as such Selling Fortress Entity has agreed in preference to with such Third Partythe Common Stock pursuant to the liquidation preference provisions of the Certificate of Incorporation; provided, however, that each such Holder shall not be permitted if the per share price being paid for the Shares of Common Stock or Preferred Stock, as applicable, being sold by the Majority Holders includes any rights to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting receive a proportionate share of any unvested Holder’s Shares); provided further deferred consideration, earn-out or escrow funds that such Selling Fortress Entity shall use its reasonable, good faith efforts may become available to provide that (A) the only representation and warranty which such Holder shall be required to make Majority Holders in connection with the Third Party proposed transaction, such amounts shall be considered when determining the implied equity price of each Share of Common Stock or Preferred Stock, as applicable, but any portion of such amount included in the implied equity price of each Share of Common Stock shall not be paid to the Investors selling Common Stock unless and until the portions of such amount included in the price per share being paid for the Preferred Stock are paid to the holders of the Preferred Stock and only to the extent that the holders of the Preferred Stock have received all amounts payable to the holders of Preferred Stock prior and in preference to the Common Stock pursuant to the liquidation preference provisions of the Certificate of Incorporation. Notwithstanding the foregoing, the aggregate consideration receivable by all holders of the Preferred Stock and Common Stock in connection with a Proposed Sale shall be allocated among the holders of Preferred Stock and Common Stock on the basis of the relative liquidation preferences to which the holders of each respective series of Preferred Stock and the holders of Common Stock are entitled in a Deemed Liquidation Event (assuming for this purpose that the Proposed Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (BDeemed Liquidation Event) the liability of such Holder with respect to any representation and warranty made in connection accordance with the Third Party Sale is the several liability Company’s Certificate of such Holder (and not joint with any other person) and that such liability is limited Incorporation in effect immediately prior to the amount of proceeds actually received by such Holder in the Third Party Proposed Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable law.
Appears in 3 contracts
Samples: Stockholders Agreement (Silk Road Medical Inc), Stockholders Agreement (Silk Road Medical Inc), Stockholders Agreement (Silk Road Medical Inc)
Drag Along Right. Notwithstanding (a) If any one or more stockholders (the “Compellors”) party to that certain Stockholders Agreement, dated as of [ ], 2010, by and among the Company, Resource Capital Fund IV L.P., Resource Capital Fund V L.P., PP IV Mountain Pass II, LLC, PP IV MP AIV 1, LLC, PP IV MP AIV 2, LLC, PP IV XX XXX 0, XXX, XXX Moly Group LLC, MP Rare Company LLC and KMSMITH LLC, as amended from time to time (the “Stockholders Agreement”), shall, in any transaction or series of related transactions, directly or indirectly, propose to sell for value in the aggregate at least seventy-six percent (76%) of the then outstanding Applicable Shares (the “Controlling Shares”) to a third party or parties (the “Drag-Along Purchaser(s)”) other provision hereofthan Specified Transferees of such Compellors (the “Drag-Along Offer”), the provisions set forth in this Paragraph 6 shall apply at the option of the Compellors.
i. The Compellors may, at their option, require Employee to sell all of the vested shares of Restricted Stock owned or held by Employee (or, if any Holder has the Compellors are not exercised its Tag-Along Right with respect to selling all of the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer shares of Common Stock have lapsedowned by the Compellors, equal to then the product same portion of (x) the total number shares of Holder’s Shares Restricted Stock owned or held by Employee as the shares of Common Stock Compellors are selling) to such Holder on the date of the Drag-Along Notice Purchaser(s) for the same consideration (or, if there is a choice as defined belowto the form of consideration, then Employee shall have the same choice as the Compellors, provided that, in the event that any securities are part of the consideration payable, if Employee is not an “accredited investor” within the meaning of Rule 501 under the Securities Act, Employee may, in the sole discretion of the Board, receive, and hereby agrees to accept, in lieu of securities, cash consideration with an equivalent value to such securities as reasonably determined by the Board) and (y) the Third Party Sale Percentage, at the same price and otherwise on the same terms and conditions upon which the Compellors sell their shares of Common Stock, subject to this Paragraph 6.
ii. The Compellors shall provide a written notice (the “Drag-Along Notice”) of such Drag-Along Offer to Employee, with a copy to the Company, not later than the day after the date of acceptance of the Drag-Along Offer by the Drag-Along Purchaser(s). The Drag-Along Notice shall contain written notice of the exercise of the rights of the Compellors pursuant to this Paragraph 6(a) setting forth the consideration to be paid by the Drag-Along Purchaser(s) and all other material terms and conditions of the Drag-Along Offer, as well as a copy of the Drag-Along Offer, and definitive documentation of the transaction, if available. Within ten (10) business days following the date the Drag-Along Notice is given, Employee shall deliver to the Compellors a special irrevocable power-of-attorney authorizing the Compellors, on behalf of Employee, to sell or otherwise dispose of such Selling Fortress Entity has agreed vested shares of Restricted Stock pursuant to the terms of the Drag-Along Offer and to take all such actions as shall be necessary or appropriate in order to consummate such sale or disposition.
iii. Promptly after the consummation of the sale of shares of Common Stock of the Compellors and vested shares of Restricted Stock of Employee to the Drag-Along Purchaser(s) pursuant to the Drag-Along Offer, but in no event more than two (2) Business Days thereafter, the Compellors shall remit to Employee the total sales price of the vested shares of Restricted Stock of Employee sold pursuant thereto less a pro rata portion of the expenses (including reasonable legal expenses) incurred by the Compellors in connection with such Third Partysale.
iv. If, at the end of the 180-day period following the giving of the Drag-Along Notice, the Compellors shall not have completed the sale of all the Controlling Shares and the vested shares of Restricted Stock of Employee, then Employee shall have no obligation with respect to such Drag-Along Offer; provided that the provisions of this Paragraph 6 shall apply to any subsequent Drag-Along Offer.
v. Except as expressly provided in this Paragraph 6, the Compellors shall have no obligation to Employee with respect to the sale or other disposition of any shares of Restricted Stock owned by Employee, and in particular, the Compellors shall have no obligation to Employee to consummate any Drag Along Offer (it being understood that any and all such decisions shall be made by the Compellors in their sole discretion). In the event that the Drag-Along Offer is not consummated by the Compellors, Employee shall not be entitled to sell or otherwise dispose of shares of Restricted Stock directly to any third party or parties pursuant to such Drag-Along Offer.
vi. In furtherance of, and not in limitation of the foregoing, in connection with any compelled sale, Employee will (i) raise no objections in its capacity as a stockholder of the Company, will consent to, vote for and raise no objections to such transaction or the process pursuant to which it was arranged, and waive dissenting rights, if any, and (ii)] execute all documents containing such terms and conditions as those executed by the Compellors that are reasonably necessary to effect the transaction; provided, however, that each such Holder (A) Employee shall not be permitted required to sell any unvested Holder’s Shares (provided that enter into a non-compete or non-solicitation other than the Company mayprovisions contained herein, in its sole discretion, accelerate a provision providing for the vesting licensing of intellectual property or the delivery of any unvested Holder’s Shares); provided further products or services, or any other provision that such Selling Fortress Entity shall use its reasonableis not a strictly financial term related directly to the sale of the shares of Restricted Stock, good faith efforts to provide that (AB) the only representation liability of the stockholders participating in the Drag-Along Offer is several and warranty not joint, (C) Employee shall not have any liability for any breaches of the representations, warranties or covenants of any other stockholder participating in the Drag-Along Offer, (D) any obligations and/or liabilities of Employee under the agreement governing such transaction and any related escrow agreement shall be borne pro rata among such stockholders participating in the Drag-Along Offer based on the proceeds and assets payable to such stockholders in such transaction (other than any such obligations that relate specifically to Employee’s shares of Restricted Stock, which obligations shall be borne solely by Employee) and shall in no event exceed the actual proceeds and assets received by Employee in such Holder transaction, (E) Employee shall not be required to make any representations or warranties or covenants in connection with the Third Party Sale is a representation and warranty such transaction except with respect to such Holder(1) Employee’s own ownership of its shares of Restricted Stock, (2) subject to the Holderprovisions of clauses (B) and (C) above, customary security holder indemnities for breaches of representations, warranties and covenants, (3) Employee’s Shares to be sold by it and its ability to convey title thereto to its shares of Restricted Stock free and clear of liens, encumbrances and adverse claims (4) Employee’s ability to enter in the transaction and (B5) customary and reasonable covenants regarding confidentiality, publicity and similar matters and (F) if Employee is given an option as to the liability form of consideration to be received, all other stockholders participating in the Drag-Along Offer shall be given the same option on the same terms; provided that, in the event that any securities are part of the consideration payable, each stockholder participating in the Drag-Along Offer that is not an “accredited investor” within the meaning of Rule 501 under the Securities Act may, in the sole discretion of the Board, receive, in lieu of securities, cash consideration with an equivalent value to such Holder with respect securities as reasonably determined by the Board.
vii. Notwithstanding anything in this Paragraph 6 to the contrary, if the Compellors or any representation and warranty made of their respective directors, officers, employees, advisors or other representatives, directly or indirectly, receive any consideration from the Drag-Along Purchaser(s) or any of its Affiliates in connection with a compelled sale other than the Third Party Sale consideration that is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder all the stockholders participating in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice Offer on a pro rata basis as part of the compelled sale, then the Compellors shall cause Employee to receive Employee’s pro rata share, determined by reference to the respective amounts of consideration otherwise payable to each of the stockholders participating in the Drag-Along Offer (including the Compellors) as part of the compelled sale, of such consideration.
viii. This Paragraph 6 shall not apply to Transfers of shares of Common Stock made pursuant to an Initial Public Offering.
(b) For purposes of this Agreement, the terms “Affiliate,” “Applicable Shares,” “Specified Transferee” and “Transfer” shall have the respective meanings ascribed to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is terms in the form Stockholders Agreement, a copy of a merger transaction, each Holder agrees which has been provided to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawEmployee.
Appears in 3 contracts
Samples: Contribution Agreement (Molycorp, Inc.), Restricted Stock Agreement (Molycorp, Inc.), Contribution Agreement (Molycorp, Inc.)
Drag Along Right. Notwithstanding (a) In the event that STC and all of its Affiliates (the "DRAG-ALONG SELLER") elect to Transfer all of their Shares to any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect to the maximum number Independent Third Party or affiliated group of Holder’s Shares Independent Third Parties (an "INDEPENDENT THIRD PARTY PURCHASER") for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect cash or securities of a Third Party Sale, then, upon the demand of publicly traded company (including any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice Seller that is being effected by a merger or consolidation of Parent with another entity) (as defined belowcollectively, a "SALE OF THE PARENT"), the Drag-Along Seller shall have the right (the "DRAG-ALONG RIGHT") and (y) to cause the other Stockholders to Transfer their respective Shares to the Independent Third Party Purchaser (or to exchange such Shares pursuant to the terms of such Sale Percentage, of the Parent) at the same price and on the same terms and conditions as the Drag-Along Seller proposes to Transfer its Shares.
(b) The Drag-Along Seller may elect to exercise the Drag-Along Right by delivering written notice to the other Stockholders at least twenty days prior to the consummation of the Sale of the Parent. The notice delivered pursuant to this Section 2.2(b) will contain a copy of the definitive documentation or an executed term sheet pursuant to which the Sale of the Parent shall occur and will state (i) the bona fide intention of the Drag-Along Seller to effect the Sale of the Parent, (ii) the name and address of the Independent Third Party Purchaser and (iii) the expected closing date of such Selling Fortress Entity has agreed Sale of the Parent.
(c) Each of the Stockholders participating in the Sale of the Parent shall deliver to with the Independent Third Party Purchaser at a closing to be held at the offices of Parent (or such Third Party; providedother place as the parties agree), howeverone or more certificates, that properly endorsed for transfer, which represent all the Shares owned by such Stockholder, and each such Holder Stockholder shall not be permitted to sell any unvested Holder’s make such representations and warranties, and shall enter into such agreements, as are customary and reasonable given each such Stockholder's percentage ownership in the Parent in the context of the proposed sale, including, without limitation, representations and warranties (and indemnities with respect thereto) that the transferee of the Shares (provided that or interests therein) is receiving title to such Shares (or interests therein), free and clear of all pledges, security interests, claims, other liens or restrictions on transfer (other than restrictions on transfer imposed pursuant to applicable securities laws). In addition, each of the Company mayStockholders shall reasonably cooperate and consult with each other in order to effect the Sale of the Parent, in its sole discretion, accelerate and provide reasonable assistance to the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make Drag Along Seller in connection with the preparation of disclosure schedules relating to representations and warranties to be made to the Independent Third Party Purchaser involved in such Sale is a representation of the Parent and warranty with respect in the determination of the appropriate exceptions to such Holder’s own ownership representations and warranties.
(d) The obligations of Cinergy and the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale Management Investors pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel 2.2 are subject to the effect that satisfaction of the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect following conditions:
(i) the per share consideration payable to the matters contemplated by this provisoStockholders in the Sale of Parent (whether through the direct or indirect Transfer of their shares in the Parent or through a liquidation of the Parent following a sale of all or substantially all of the Parent's assets) must be equal to or greater than at least ninety percent (90%) of the then fair market value of such shares, each Selling Fortress Entity who has delivered a as the same may be determined in accordance with the procedures set forth in Section 2.6.
(ii) upon the consummation of the Sale of the Parent following the exercise of the Drag-Along Notice Right, all of the Stockholders shall receive the same proportion of the aggregate consideration from such Sale of the Parent that such Stockholder would have received if such aggregate consideration had been distributed by the Parent in complete liquidation pursuant to the rights and preferences set forth in the certificate of incorporation of the Parent (as in effect immediately prior to such Holder Sale of the Parent) (giving effect to applicable orders of priority and the exercise price of any warrants or options);
(iii) no Stockholder shall indemnify be obligated to make any out-of-pocket expenditure prior to the consummation of the Sale of the Parent and no Stockholder shall be obligated to pay more than its, his or her pro rata share (based upon the amount of consideration received) of reasonable expenses incurred in connection with a consummated Sale of the Parent to the extent such Holder costs are incurred for any such violation. If the Third Party Sale is in benefit of all Stockholders and are not otherwise paid by the form Parent or the acquiring party (costs incurred by or on behalf of a merger transaction, each Holder agrees Stockholder for its or his sole benefit will not be considered costs of the transaction hereunder); and
(iv) at least fifteen days prior notice of a Sale of the Parent shall be provided to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawthe Stockholders.
Appears in 2 contracts
Samples: Subscription and Contribution Agreement (Convergent Holding Corp), Stockholders' Agreement (Convergent Holding Corp)
Drag Along Right. Notwithstanding any other provision hereof, if any Holder has not exercised its TagIn the event that one or more Shareholders holding together more than fifty percent (50%) of the then-Along Right with respect current issued and outstanding shares of Voting Common Stock (the “Majority Shareholders”) desire to sell shares of Common Stock held by such Majority Shareholders representing at least a majority of the maximum number shares of HolderCommon Stock held by all Shareholders in one or more related arm’s Shares for which such Holder is permitted length transactions (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party “Sale”), then, upon delivery of a Sale Notice pursuant to Section 3(b) hereof, each of the demand of any Selling Fortress Entity participating other Shareholders (the “Minority Shareholders”) shall be obligated as such Sale may require to: (i) sell, transfer, and deliver or cause to be sold, transferred or delivered to the acquirer or acquirers in such Third Party Sale (in each such entity’s sole discretion)Sale, such Holder shall sell to an equivalent proportion of the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and Minority Shareholders on the same terms and conditions as such Selling Fortress Entity has agreed the Majority Shareholders shall sell their shares of Common Stock in the Sale, which terms and conditions shall not be materially less favorable to the Minority Shareholders than as set forth in the Sale Notice (as defined below) (without taking into consideration any consulting, non-competition or similar agreement or arrangement that may be offered to the Majority Shareholders in connection with such Third Partythe Sale); provided, however, that each the terms of the Sale shall take into account the relative values of the Voting Common Stock and Non-Voting Common Stock with respect to differences in voting rights of each; (ii) vote all such Holder shall not be permitted to sell Minority Shareholder’s shares of Common Stock at any unvested Holder’s Shares meeting of the shareholders called in part for such purpose (provided that or execute a written consent in lieu thereof) in favor of the Company may, in its sole discretion, accelerate the vesting Sale; and (iii) refrain from exercising any applicable dissenters’ rights or rights of appraisal under applicable law at any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty time with respect to such Holder’s own ownership matters. If the Corporation is unable, for any reason whatsoever, to secure the signature of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect any Shareholder to any representation and warranty made applicable document in connection with such Sale, then by signing this Agreement such Shareholder hereby irrevocably designates and appoints the Third Party Sale is the several liability Corporation’s Board of Directors (or any designee thereof) as such Holder (Shareholder’s agent and not joint with any other person) attorney-in-fact, to act on behalf of, execute and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for file any such violation. If the Third Party Sale is in the form of a merger required document and to do all other lawfully permitted acts to further such proposed transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable law.
Appears in 2 contracts
Samples: Subscription Agreement, Subscription Agreement
Drag Along Right. Notwithstanding any other provision hereof2.1.1 In the event of a bona fide firm offer from an unaffiliated third party which, if any Holder has not exercised its Tag-Along Right with respect consummated, would result in such third party owning at least fifty (50) per cent of all Shares then outstanding (regardless of the form of transaction proposed in such offer), and provided that the Majority Shareholders accept such offer (or the Company certifies that the Majority Shareholders are required to accept the maximum number of Holder’s Shares for which such Holder is permitted (offer pursuant to Section 2(b)(ii)(Ban agreement among the Majority Shareholders) above) to exercise such Tag-Along Right in respect of (a Third Party “Trade Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion”), such the Holder shall sell to hereby irrevocably agrees, on written request by the respective Third Party Company, to:
(a) transfer the number same pro rata share of whole Holder’s Shares (rounded upwards or downwardsits Shares, on a fully diluted basis, as applicable), whether or not the restrictions transferring Majority Shareholders on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on substantially the same terms and conditions conditions;
(b) if a shareholder approval is required, vote (in person, by proxy or by action by written consent, as applicable) all his/her/its Shares in favour of, and adopt, such Selling Fortress Entity has agreed Trade Sale or any measures required for its execution and consummation;
(c) execute and deliver all related documentation and take such other action in support of the Trade Sale as shall reasonably be requested by the Company and/or any Majority Shareholder;
(d) refrain from exercising any dissenters’ rights, rights of appraisal or similar rights under applicable law at any time with respect to such Trade Sale; and
(e) in the event that the sellers, in connection with such Third Party; providedTrade Sale, howeverappoint a shareholder representative with respect to matters affecting the shareholders under the applicable definitive transaction agreements pending and following consummation of such Trade Sale, that each consent to: (i) the appointment of such shareholder representative, (ii) the establishment of any applicable escrow, expense or similar account in connection with any indemnification, purchase price adjustment or similar obligations, and (iii) the payment of such shareholder’s pro rata portion (from the applicable escrow or expense account or otherwise) of any and all reasonable fees and expenses to such shareholder representative in connection with its services and duties in connection with such Trade Sale.
2.1.2 Notwithstanding the foregoing, Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make comply with Section 2.1.1 in connection with any proposed Trade Sale unless:
(a) except as provided for in paragraph (b) below, the Third Party Sale is a Holder shall not be liable for the inaccuracy of any representation and or warranty made by any other person or entity in connection with respect to such Holder’s own ownership of Trade Sale, other than the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and Company;
(Bb) the liability for indemnification, if any, of the Holder in such Holder with respect to Trade Sale and for the inaccuracy of any representation representations and warranty warranties made by the Company or its stockholders in connection with the Third Party Sale such Trade Sale, is the several liability of such Holder (and not joint with any other personperson or entity (except to the extent that funds may be deposited in and paid out of an escrow established to cover breach of representations and warranties), and is pro rata in proportion to, and does not exceed, the amount of consideration paid to the Holder in connection with such Trade Sale; and
(c) and that such liability is shall be limited to the Holder’s applicable share of a negotiated aggregate indemnification amount that applies equally to all stockholders of the Company participating in such Trade Sale but that in no event exceeds the amount of proceeds actually received by such consideration otherwise payable to the Holder in the Third Party connection with such Trade Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion except with respect to claims related to fraud or wilful misconduct by the matters contemplated by this provisoHolder, each Selling Fortress Entity who has delivered a Drag-Along Notice the liability for which need not be limited as to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder; provided that Holder agrees to vote its Holder’s Shares be responsible for any additional reasonable costs incurred by the Company or a Majority Shareholder directly related to ensuring that such Trade Sale complies with the conditions set forth in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawthis Section 2.1.2.
Appears in 2 contracts
Samples: Exchange Agreement (Spotify Technology S.A.), Exchange Agreement (Spotify Technology S.A.)
Drag Along Right. (i) Notwithstanding any other provision hereofcontained in this Agreement, if at any Holder has not exercised its Tag-time the Board shall approve a Change in Control of Development, specifying that this subsection (e) shall apply, then Development shall provide written notice of such approval (the “Drag Along Right with respect Notice”) to the maximum number Class B Party, and the Class B Party hereby agrees:
(A) if such transaction requires the approval of Holder’s Shares for which such Holder is permitted (pursuant the Members, to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale vote (in each such entity’s sole discretion)person, such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards by proxy or downwardsby action by written consent, as applicable), whether with respect to all Membership Interests that such Class B Party owns or not over which such Class B Party otherwise exercises voting power, in favor of such Change in Control and, if directed by the restrictions on Transfer Board, to vote in opposition to any and all other proposals that could reasonably be expected to delay or impair the ability of Common Stock have lapsedDevelopment to consummate such Change in Control;
(B) if such Change in Control is structured as a sale of Membership Interests, equal to sell the product same proportion of (x) the total number of Holder’s Shares Membership Interests beneficially held by such Holder on Class B Party as is being sold by the date of Class A Party to the Drag-Along Notice (as defined below) and (y) person or entity to whom the Third Class A Party Sale Percentageproposes to sell its Membership Interests, at the same price and on the same terms and conditions as the Class A Party;
(C) to execute and deliver all related documentation and take such Selling Fortress Entity has agreed other action in support of the Change in Control as shall reasonably be requested by the Board in order to carry out the terms and provisions of this subsection (e), including executing and delivering instruments of conveyance and transfer, and any purchase agreement, merger agreement, indemnity agreement, escrow agreement, consent, waiver, governmental filing, LLC Certificates duly endorsed for transfer (free and clear of impermissible liens, claims, and encumbrances), and any similar or related documents;
(D) to refrain from exercising any dissenters’ rights or rights of appraisal under applicable law at any time with respect to such Third PartyChange in Control; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares and
(provided E) that the Company mayproxy granted pursuant to subsection (iv) below shall become exercisable automatically by the Proxy Holder without any further action on the part of such Class B Party.
(ii) Each Drag-Along Notice required by subsection (e)(i) above shall include reasonable details of the Change in Control including, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that following: (A) the only representation proposed time and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership place of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear closing of liens, encumbrances and adverse claims the Change in Control; and (B) the liability substantive terms and conditions of the Change in Control including (1) the purchase price and terms of payment, (2) the identity of the purchaser, and (3) a copy of any term sheet or definitive documents governing such Holder Change of Control.
(iii) Notwithstanding the foregoing, the Class B Party will not be required to comply with respect to this subsection (e) in connection with any specific Change in Control (the “Proposed Change in Control”) unless:
(A) the Class B Party shall not be liable for the inaccuracy of any representation and or warranty made by any other Person in connection with the Third Party Sale is Proposed Change in Control, other than Development;
(B) the several liability for indemnification, if any, of such Holder (Class B Party in the Proposed Change in Control and for the inaccuracy of any representations and warranties made by Development in connection with such Proposed Change in Control, is several and not joint with any other personPerson, and is pro rata in accordance with the portion of the proceeds received by such Class B Party in the Change in Control;
(C) and that such liability is shall be limited to the amount of proceeds consideration actually received paid to such Class B Party in connection with such Proposed Change in Control, except with respect to (1) representations and warranties of such Class B Party related to authority, ownership of the Membership Interests held by such Holder Class B Party and the ability to convey title to such Membership Interests, (2) any covenants made by such Class B Party with respect to confidentiality or voting related to the Proposed Change in Control, or (3) claims related to fraud or willful breach by such Class B Party, the Third Party Sale; provided further, that a Holder shall liability for which need not be obligated to participate limited; and
(D) the Proposed Change of Control provides for the Class B Party receiving the greatest consideration on an Allocation Percentage basis and otherwise on the best terms by which any Class A Party receives in any Third Party Sale such Proposed Change of Control.
(iv) As security for the performance of the Class B Party’s obligations pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel subsection (e), the Class B Party hereby grants to the effect that Class A Party (the Third Party Sale is not “Proxy Holder”), with full power of substitution and resubstitution, exercisable automatically upon receipt of Board approval of a Change in violation Control subject to a Drag Along Notice, an irrevocable proxy to vote all Membership Interests held by such Class B Party, at all meetings of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion the Members held after the date of this Agreement with respect to a Change in Control subject to a Drag Along Notice, or to execute any written consent in lieu thereof, and hereby irrevocably appoints the matters contemplated by this provisoProxy Holder, each Selling Fortress Entity who has delivered a Dragwith full power of substitution and resubstitution, as the Class B Party’s attorney-Along Notice in-fact with authority to such Holder shall indemnify such Holder for sign any documents with respect to any such violationvote or any actions by written consent of the Members taken after the date of this Agreement, in either case in connection with matters directly related to a Change in Control subject to a Drag Along Notice. If the Third Party Sale is in the form of a merger transaction, each Holder agrees This proxy shall be deemed to vote its Holder’s Shares in favor of such merger be coupled with an interest and not to exercise any rights of appraisal or dissent afforded under applicable lawshall be irrevocable.
Appears in 2 contracts
Samples: Limited Liability Company Agreement (Gevo, Inc.), Limited Liability Company Agreement (Gevo, Inc.)
Drag Along Right. Notwithstanding (i) Anything contained herein to the contrary notwithstanding, if Third Point Re or any Permitted Transferee thereof (the “Initiating Investor”) proposes, pursuant to a bona fide arm’s length agreement with an unrelated third party other than any Hiscox Competitor, (A) the Transfer, directly or indirectly, of all of the Shares of the Company then held by Third Point Re and all of its Permitted Transferees, (B) the merger, amalgamation or consolidation of the Company with or into any other provision hereofPerson or Persons, or (C) the sale by the Company of all or substantially all of its assets to any other Person or Persons (each event described in clauses (A), (B) or (C), a “Sale Proposal”), then the Initiating Investor shall deliver a Sale Notice to each other Investor setting forth the details of such Sale Proposal no later than 30 days prior to the proposed closing date thereof. The Initiating Investor shall have the right to require each other Investor to participate in such Sale Proposal (the “Drag Right”), the exercise of which shall be clearly stated in the Sale Notice. If the Initiating Investor exercises the Drag Right, each other Investor shall be obligated (which obligation shall be enforceable by the Company) to participate in the transaction (a “Required Sale”) contemplated by the Sale Proposal, and, if applicable, to sell all of its Shares and otherwise to take all necessary action to cause the Company and the Investors to consummate such Required Sale, including, if applicable, voting all Shares then owned by such Investor in favor of, or selling any Holder has not exercised its Tag-Along Shares owned thereby in, such Required Sale and waiving any appraisal or similar rights such Investor may have under applicable law with respect thereto. For avoidance of doubt, no Initiating Investor shall have any Drag Right with respect to any proposed transaction to which any Hiscox Competitor is party.
(ii) Each Investor shall execute and deliver such instruments of conveyance and transfer and take such other action, including executing any purchase agreement, merger or amalgamation agreement, indemnity agreement, escrow agreement or related documents, as may be reasonably required by the maximum number Company or the Initiating Investor in order to (as applicable) Transfer its Shares and otherwise to approve and consummate a Required Sale in accordance with the terms and provisions of Holder’s Shares for which this Section 3(b), and in furtherance of the foregoing, each Investor shall be required to make to the proposed transferee or purchaser in the Required Sale substantially the same representations, warranties, covenants, indemnities and agreements as the Initiating Investor agrees to make in connection with such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Required Sale, thenand agree to the same conditions to such transaction as such Initiating Investor agrees (except that, upon in the demand case of any Selling Fortress Entity participating in representations, warranties, covenants, indemnities, agreements and conditions pertaining specifically to such Third Party Sale (Initiating Investor, each other Investor shall make comparable representations, warranties, covenants, indemnities and agreements and shall agree to comparable conditions, in each such entity’s sole discretion), such Holder shall sell case to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicableextent applicable and pertaining specifically to itself and only to itself), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company maythat, in its sole discretionall representations, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonablewarranties, good faith efforts to provide that (A) the only representation covenants, indemnities and warranty which such Holder agreements shall be required made by all Investors severally and not jointly, and any liability of the Investors thereunder shall (1) be borne by each of them on a pro rata basis determined according to make the aggregate proceeds to be received by them in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liensRequired Sale, encumbrances and adverse claims and (B2) the liability of such Holder in no event exceed, with respect to any representation and warranty made Investor, the net proceeds to be paid to such Investor in connection with the Third Party Required Sale is (it being understood and agreed that, with respect to representations, warranties, covenants, indemnities and agreements pertaining specifically to any Investor, only such Investor making such representations, warranties, covenants, indemnities and agreements shall have any liability in respect thereof, subject in all cases to the several liability limitation set forth in clause (2) immediately above).
(iii) Notwithstanding anything contained in this Section 3(b), in the event that all or a portion of the purchase price in a Required Sale consists of securities and the transfer of such Holder securities to any Investor would require either a registration under the Securities Act, or the preparation of a disclosure document pursuant to Regulation D under the Securities Act (and not joint with or any other personsuccessor regulation) and that or a similar provision of any state securities law, then, at the option of the Company or the Initiating Investor, any one or more of such liability is limited Investors may receive, in lieu of such securities, an amount in cash equal to the amount fair market value of proceeds actually the securities that would have otherwise been received by such Holder Investor in connection with the Third Party Required Sale; provided further, that a Holder shall not such amount to be obligated determined in good faith by the Board.
(iv) If any Investor fails or refuses to participate vote or sell his Shares as required by, or votes his Shares in any Third Party Sale pursuant to contravention of, this Section 2(b)(iii) unless 3(b), then such Holder is provided an opinion of counsel Investor hereby grants to the effect that Secretary and the Third Party Sale is not in violation Assistant Secretary of applicable federal and state securities or other laws orthe Company an irrevocable proxy, if such Holder is not provided coupled with an opinion with respect to the matters contemplated by this provisointerest, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s such Shares in favor accordance with the provisions of this Section 3(b), and hereby appoints the Secretary and the Assistant Secretary of the Company his or its attorney-in-fact, to sell such merger and not to exercise any rights Shares in accordance with the provisions of appraisal or dissent afforded under applicable lawthis Section 3(b).
Appears in 2 contracts
Samples: Shareholders Agreement (Third Point Reinsurance Ltd.), Shareholder Agreement (Third Point Reinsurance Ltd.)
Drag Along Right. Notwithstanding any other provision hereofPCTEL may, if any Holder has not exercised its Tag-Along Right with respect by written notice to the maximum number of Holder’s Shares for which such Holder is permitted Eclipse (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the “Drag-Along Notice (as defined below) and (y) the Third Party Sale PercentageNotice”), at the same price and require Eclipse to sell all of its Membership Interests to such third-party purchaser on the same terms and conditions as such Selling Fortress Entity has agreed substantially identical to with such Third Party; providedthose on which PCTEL will sell its Membership Interests, howeverand Eclipse shall vote for, that each such Holder shall not be permitted consent to sell any unvested Holder’s Shares (provided that and raise no objections against the Company mayApproved Sale. Not in limitation of the foregoing, in its sole discretionconnection with an Approved Sale, accelerate Eclipse agrees to take all steps necessary to comply, and to enable it to comply, with the vesting provisions of any unvested Holder’s Sharesthis Section 9.6(B)(i); provided further that , including without limitation the execution and delivery of appropriate instruments of transfer and such Selling Fortress Entity other agreements and instruments as may reasonably be required by the purchaser or PCTEL for the closing of the Approved Sale at such date and time as PCTEL shall use its reasonable, good faith efforts to provide that specify. In connection with an Approved Sale: (A1) the only representation and warranty which such Holder Eclipse shall be required to make in connection customary representations or warranties relating to (i) its own due incorporation and execution and delivery of the relevant agreements and instruments, (ii) the enforceability of such agreements and instruments against it, (iii) the absence of conflicts with the Third Party Sale is a representation agreements, laws and warranty with respect court and governmental orders applicable to such Holder’s own it, (iv) its ownership of the Holder’s Shares to be Membership Interests being sold by it and its ability to convey title thereto free and clear of liensall liens and encumbrances except those arising under this Agreement, encumbrances and adverse claims and (Bv) such other representations or warranties as are reasonably necessary in order to effect the liability transfer of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder Membership Interests contemplated thereby; (and not joint with any other person2) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder Eclipse shall not be obligated required to participate provide any indemnities except as provided in clause (3); (3) Eclipse may be required to execute and deliver the applicable purchase and sale agreements and in the event that a portion of the purchase price is required by the terms of such agreements to be placed in escrow or otherwise withheld to support purchase price adjustment obligations post-closing (including as it relates to indemnification required by the purchaser in a transaction for breaches of representations or warranties relating to the Company and/or the Membership Interests or assets sold), Eclipse will have a pro rata portion of its purchase price placed in such escrow or otherwise withheld to be utilized to pay any Third Party Sale such purchase price adjustment and/or indemnification obligations; and (4) Eclipse shall not be required to agree to restrictive covenants that would materially impair its ability to conduct its business as conducted as of the date of this Agreement (exclusive of the activities of the Company). Eclipse hereby consents to the appointment of a member representative by the Board for the purposes of all dealings with same and to the indemnification of such member representative for all actions taken in good faith in relation to same, all pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to a member representative agreement in a form approved by the effect that the Third Party Sale is not Board in violation of applicable federal and state securities or other laws orits reasonable discretion, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder which Eclipse agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawexecute promptly upon receipt.
Appears in 2 contracts
Samples: Limited Liability Company Agreement (Pc Tel Inc), Limited Liability Company Agreement (Pc Tel Inc)
Drag Along Right. Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect to the maximum number of Holder’s Common Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above3(b)(ii)(b)) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares shares of Common Stock (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares shares of Common Stock held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares shares of Common Stock to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii3(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares shares of Common Stock in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable law.
Appears in 2 contracts
Samples: Management Shareholder Agreement (Seacastle Inc.), Shareholder Agreement (Seacastle Inc.)
Drag Along Right. Notwithstanding any other provision hereofSubject to the AAG ROFR:
(a) LMP Member may initiate a Sale Transaction with a Third Party in accordance with this Section 7.11(a) by delivery of written notice to the Company and, if any Holder has not exercised its Tagupon delivery of such notice, shall have the rights described in this Section 7.11 (such right a “Drag-Along Right Right” and such Sale Transaction, a “Drag-Along Transaction”).
(b) In connection with respect to the maximum number of Holder’s Shares for which such Holder is permitted (any Drag-Along Transaction initiated pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion7.11(a), such Holder shall sell and subject to the respective Third Party terms and conditions set forth in this Section 7.11, AAG Member hereby does (and shall promptly, if required by the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not LMP Member) consent in writing to and raise no objections against the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date consummation of the Drag-Along Notice Transaction, and if the Drag-Along Transaction is structured as (as defined belowi) a consolidation, merger or other business combination, or a sale or other disposition of all or substantially all of the assets of the Company and/or its Subsidiaries, each holder of Membership Interests entitled to vote thereon shall vote in favor of the Drag-Along Transaction and shall waive any appraisal rights or similar rights in connection with such consolidation, merger, other business combination or asset sale or (ii) a sale of all of its Membership Interests, AAG Member hereby agrees (and, if required by the LMP Member, shall promptly agree in writing) to sell all of its Membership Interests that are the subject of the Drag- Along Transaction, on the terms and conditions of such Drag-Along Transaction. AAG member shall promptly take all necessary and desirable actions in connection with the consummation of the Drag-Along Transaction reasonably requested by the LMP Member, including the execution of such agreements and such other instruments and other actions reasonably necessary to (x) provide customary representations, warranties, indemnities, and escrow or holdback arrangements relating to such Drag-Along Transaction, in each case to the extent that each other holder of Membership Interests is similarly obligated; and (y) effectuate the Third Party Sale Percentageallocation and distribution of the aggregate consideration upon the Drag-Along Transaction as set forth in Section 7.11(c). Subject to the satisfaction or waiver of the AAG ROFR, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder holders of Membership Interests shall not be permitted to sell their Membership Interests pursuant to any unvested Holder’s Shares Drag-Along Transaction without complying with any other provisions of this Article VII.
(provided c) The obligations of the holders of Membership Interests pursuant to this Section 7.11 are subject to the following terms and conditions:
(i) upon the consummation of the Drag-Along Transaction, each holder of Membership Interests shall receive the same proportion of the aggregate consideration from such Drag-Along Transaction that such holder would have received if such aggregate consideration had been distributed by the Company mayin complete liquidation pursuant to the rights and preferences set forth in Section 12.1 (i.e., net of debts and liabilities of the Company and its Subsidiaries) as in effect immediately prior to the consummation of such Drag-Along Transaction, and if a holder of Membership Interests receives consideration from such Drag-Along Transaction in a manner other than as contemplated by such rights and preferences or in excess of the amount to which such holder is entitled in accordance with such rights and preferences, then such holder shall take such action as is necessary so that such consideration shall be immediately reallocated among and distributed to the holders of Membership Interests in accordance with such rights and preferences;
(ii) the Company shall bear the reasonable, documented costs incurred in connection with any Drag-Along Transaction (costs incurred by or on behalf of any holder of Membership Interests for its sole benefit will not be considered costs of the Drag-Along Transaction) unless otherwise agreed by the Company (as approved by the Board) and the acquiror, in its sole discretion, accelerate the vesting which case no holder of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder Membership Interests shall be required obligated to make any out-of-pocket expenditure prior to the consummation of the Drag-Along Transaction (excluding modest expenditures for postage, copies, and the like) and no holder of Membership Interests shall be obligated to pay any portion (or, if paid, shall be entitled to be reimbursed by the Company for that portion paid) that is more than its pro rata share (based upon the amount of consideration received by such holder in the Drag-Along Transaction) of reasonable expenses incurred in connection with a consummated Drag- Along Transaction for the benefit of all holders of Membership Interests and are not otherwise paid by the Company or another Person;
(iii) consideration placed in escrow or held back shall be allocated among holders of Membership Interests such that if the applicable Third Party in the Drag-Along Transaction ultimately is entitled to some or all of such escrow or holdback amounts, then the net ultimate proceeds received by such holders shall still comply with the intent of Section 7.11(c)(i) as if the ultimate resolution of such escrow or holdback had been known at the closing of the Drag-Along Transaction; and
(iv) if some or all of the consideration received in connection with the Third Party Sale Drag- Along Transaction is other than cash, then such consideration shall be deemed to have a representation and warranty with respect dollar value equal to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability fair market value of such Holder with respect to any representation and warranty made consideration (as determined, in connection with good faith, by the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party SaleBoard); provided further, that a Holder the AAG Member shall not be obligated required to participate in any Third Party Sale pursuant consent to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice Transaction if the consideration to be received in connection with such Holder shall indemnify such Holder for any such violation. If the Third Party Sale Drag- Along Transaction is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawother than cash.
Appears in 2 contracts
Samples: Membership Interest Purchase Agreement (LMP Automotive Holdings, Inc.), Membership Interest Purchase Agreement (LMP Automotive Holdings, Inc.)
Drag Along Right. Notwithstanding any other provision hereof(a) Subject to Section 3.3, if the KKR Stockholders (the “Dragging Stockholders”) (i) receive an offer to purchase or otherwise desire to Transfer (a “Sale Proposal”) a number of Shares, including Shares owned by other Stockholders (the “Drag Shares”) and Shares owned by the KKR Stockholders, such that the transaction would result in a sale of 50% or more of the Shares held by the Stockholders (taking into account all Shares being “dragged”) or (ii) otherwise desires to cause a Company Sale, including by merger, sale of assets (including the capital stock of any Holder has not exercised its Tag-Along Right Subsidiaries of the Company) or other business combination (each of (i) and (ii), a “Required Sale”), then the Dragging Stockholders may, by delivery of a written notice (a “Required Sale Notice”) with respect to such Sale Proposal at least twenty (20) Business Days prior to the maximum number anticipated closing date of Holder’s such Required Sale to all other Stockholders, require all other Stockholders to Transfer their Shares for which to the proposed transferee, and/or take such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise other actions as may be reasonably requested in such Tag-Along Right in respect of a Third Party Required Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date Same Terms and Conditions, in accordance with the provisions of this Section 3.5.
(b) The Required Sale Notice will include the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same material terms and conditions of the Required Sale, including (i) the name and address of the proposed transferee, (ii) the proposed amount (including the amount per Share, if then calculable, or an estimate thereof) per Share purchase price and form of consideration and (iii) the proposed Transfer date, if known. The Dragging Stockholders will deliver or cause to be delivered to each other Stockholder copies of all transaction documents relating to the Required Sale promptly as the same become available.
(c) Each Stockholder, upon receipt of a Required Sale Notice, shall be obligated to Transfer the same proportion of its Shares as is to be transferred by the Dragging Stockholder in the Required Sale contemplated by the Sale Proposal, to vote, if required by this Agreement or otherwise, its Shares in favor of the Required Sale at any meeting of stockholders called to vote on or approve the Required Sale and/or to consent in writing to the Required Sale, to cause any designees of such Selling Fortress Entity has agreed Stockholder serving on the Board to with such Third Party; providedvote in favor of the Required Sale in a vote among the Board called to vote on or approve the Required Sale and/or to consent in writing to the Required Sale, howeverto waive all dissenters’ or appraisal or similar rights, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company mayif any, in its sole discretionconnection with the Required Sale, accelerate to enter into agreements relating to the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonableRequired Sale, good faith efforts to provide that agree (Aas to itself) to make to the only representation proposed purchaser the same representations, warranties, covenants, indemnities and warranty which such Holder shall be required agreements as the Dragging Stockholders agree to make in connection with the Third Party Required Sale, and to take or cause to be taken all other actions as may be reasonably necessary to consummate the Required Sale; provided that (x) unless otherwise agreed, a Stockholder may not be required to make representations and warranties or provide indemnities as to any other Stockholders, (y) no such Stockholder shall be liable for the breach of any covenant by any other Stockholder and (z) notwithstanding anything in this Section 3.5(c) to the contrary, any liability relating to representations and warranties and covenants (and related indemnities) and other indemnification obligations regarding the business of the Company or its Subsidiaries assumed in connection with the Required Sale is shall be shared by all Stockholders based on their respective Sharing Percentages and in any event shall not exceed the proceeds received by such Stockholder in the Required Sale.
(d) Any expenses incurred for the benefit of the Company or all Stockholders, and any indemnities, holdbacks, escrows and similar items relating to the Required Sale, that are not paid or established by the Company (other than those that relate to representations or indemnities concerning a representation and warranty with respect to such HolderStockholder’s own valid ownership of the Holder’s its Shares to be sold by it and its ability to convey title thereto free and clear of all liens, encumbrances and adverse claims and encumbrances or a Stockholder’s authority, power and legal right to enter into and consummate a purchase or merger agreement or ancillary documentation and the enforceability thereof against such Stockholder) shall be paid or established by the Stockholders in accordance with their respective proportionate share based upon the number of Shares Transferred in such Required Sale by such Stockholder as a proportion of the total number of Shares Transferred in such Required Sale by all of the Stockholders.
(Be) The Dragging Stockholders shall, in their sole discretion, decide whether or not to pursue, consummate, postpone or abandon any Required Sale and the terms and conditions thereof. No Stockholder nor any Affiliate of any such Stockholder shall have any liability of such Holder with respect to any representation and warranty made other Stockholder or the Company arising from, relating to or in connection with the Third Party pursuit, consummation, postponement, abandonment or terms and conditions of any Required Sale is except to the several liability extent such Stockholder shall have failed to comply with the provisions of this Section 3.5.
(f) For the avoidance of doubt, if the Required Sale Notice provides for cash consideration but certain Stockholders are given the option by the third party Transferee to receive securities in lieu of such Holder cash consideration in connection with a rollover transaction or similar transaction and elect to do so, such rollover securities shall be deemed to be the same form of consideration.
(and not joint with any other persong) and that such liability is limited to the amount The provisions of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided 3.5 shall terminate upon the completion of an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawInitial Public Offering.
Appears in 2 contracts
Samples: Stockholders’ Agreement (BrightSpring Health Services, Inc.), Stockholders’ Agreement (BrightSpring Health Services, Inc.)
Drag Along Right. Notwithstanding any other provision hereof(a) Subject to the terms of Section 8(b) and notwithstanding the requirements that would otherwise apply pursuant to Section 8(c), if any Holder has not exercised its Tagone or more Stockholders (the “Compellors”) shall, in any transaction or series of related transactions, directly or indirectly, propose to sell for value in the aggregate at least seventy-Along Right with respect to six percent (76%) of the maximum number of Holder’s then outstanding Applicable Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) abovethe “Controlling Shares”) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon third party or parties (the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the “Drag-Along Notice Purchaser(s)”) other than Specified Transferees of such Compellors (the “Drag-Along Offer”), the provisions set forth in this Section 6 shall apply at the option of the Compellors. The Compellors may, at their option, require all of the other Stockholders, including any Permitted Transferees thereof (the “Compelled Stockholders”), to sell all shares of Capital Stock owned or held by them (or, if the Compellors are not selling all of the shares of Capital Stock owned by the Compellors, then the same portion of the shares of Capital Stock owned or held by the Compelled Stockholders as defined belowthe Compellors are selling) to such Drag-Along Purchaser(s) for the same consideration (or, if there is a choice as to the form of consideration, then each Compelled Stockholder shall have the same choice as the Compellors, provided that, in the event that any securities are part of the consideration payable, any Stockholder that is not an “accredited investor” within the meaning of Rule 501 under the Securities Act may, in the sole discretion of the Board of Directors of the Corporation (the “Board”), receive, and hereby agrees to accept, in lieu of securities, cash consideration with an equivalent value to such securities as reasonably determined by the Board) and (y) the Third Party Sale Percentage, at the same price and otherwise on the same terms and conditions upon which the Compellors sell their shares of Capital Stock, subject to this Section 6.
(i) The Compellors shall provide a written notice (the “Drag-Along Notice”) of such Drag-Along Offer to each of the Compelled Stockholders, with a copy to the Corporation, not later than the day after the date of acceptance of the Drag-Along Offer by the Drag-Along Purchaser(s). The Drag-Along Notice shall contain written notice of the exercise of the rights of the Compellors pursuant to Section 6(a) setting forth the consideration to be paid by the Drag-Along Purchaser(s) and all other material terms and conditions of the Drag-Along Offer, as well as a copy of the Drag-Along Offer, and definitive documentation of the transaction, if available. Within ten (10) Business Days following the date the Drag-Along Notice is given, each of the Compelled Stockholders shall deliver to the Compellors a special irrevocable power-of-attorney authorizing the Compellors, on behalf of such Selling Fortress Entity has agreed Compelled Stockholder, to sell or otherwise dispose of such shares of Capital Stock pursuant to the terms of the Drag-Along Offer and to take all such actions as shall be necessary or appropriate in order to consummate such sale or disposition.
(ii) Promptly after the consummation of the sale of shares of Capital Stock of the Compellors and the Compelled Stockholders to the Drag-Along Purchaser(s) pursuant to the Drag-Along Offer, but in no event more than two (2) Business Days thereafter, the Compellors shall remit to the Compelled Stockholders the total sales price of the shares of Capital Stock of the Compelled Stockholders sold pursuant thereto less a pro rata portion of the expenses (including reasonable legal expenses) incurred by the Compellors in connection with such Third Partysale.
(iii) If, at the end of the 180-day period following the giving of the Drag-Along Notice, the Compellors shall not have completed the sale of all the Controlling Shares and the shares of Capital Stock of the Compelled Stockholders, then no Stockholder shall have any obligation with respect to such Drag-Along Offer; provided, that the provisions of this Section 6 shall apply to any subsequent Drag-Along Offer.
(iv) Except as expressly provided in this Section 6, the Compellors shall have no obligation to any Compelled Stockholder with respect to the sale or other disposition of any shares of Capital Stock owned by the Compelled Stockholder, and in particular, the Compellors shall have no obligation to any Compelled Stockholder to consummate any Drag Along Offer (it being understood that any and all such decisions shall be made by the Compellors in their sole discretion). In the event that the Drag-Along Offer is not consummated by the Compellors, the Compelled Stockholders shall not be entitled to sell or otherwise dispose of shares of Capital Stock directly to any third party or parties pursuant to such Drag-Along Offer (it being understood that all such sales and other dispositions shall be made only on the terms and pursuant to the procedures set forth in Sections 3, 4, 5, 6, 7 and 8).
(c) In furtherance of, and not in limitation of the foregoing, in connection with any compelled sale, each Stockholder will (i) raise no objections in its capacity as a stockholder of the Corporation, will consent to, vote for and raise no objections to such transaction or the process pursuant to which it was arranged, and waive dissenting rights, if any, and (ii) execute all documents containing such terms and conditions as those executed by other Stockholders that are reasonably necessary to effect the transaction; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) no Compelled Stockholder shall be required to enter into a non-compete or non-solicitation or no-hire provision, a provision providing for the only representation licensing of intellectual property or the delivery of any products or services, or any other provision that is not a strictly financial term related directly to the sale of the shares of Capital Stock, (B) the liability of the Stockholders is several and warranty not joint, (C) no Compelled Stockholder shall have any liability for any breaches of the representations, warranties or covenants of any other Stockholder, (D) any obligations and/or liabilities of Compelled Stockholders under the agreement governing such transaction and any related escrow agreement shall be borne pro rata among such Stockholders based on the proceeds and assets payable to such Stockholders in such transaction (other than any such obligations that relate specifically to a particular Stockholder’s shares of Capital Stock, which obligations shall be borne solely by such Holder Stockholder) and shall in no event exceed the actual proceeds and assets received by such Compelled Stockholder in such transaction, (E) no Compelled Stockholder shall be required to make any representations or warranties or covenants in connection with the Third Party Sale is a representation and warranty such transaction except with respect to (1) such HolderCompelled Stockholder’s own ownership of its shares of Capital Stock, (2) subject to the Holderprovisions of clauses (B) and (C) above, customary security holder indemnities for breaches of representations, warranties and covenants, (3) such Compelled Stockholder’s Shares to be sold by it and its ability to convey title thereto to its shares of Capital Stock free and clear of liens, encumbrances (4) such Compelled Stockholder’s ability to enter in the transaction and adverse claims such Compelled Stockholder’s power and organization and (B5) customary and reasonable covenants regarding confidentiality, publicity and similar matters and (F) if any Stockholder is given an option as to the liability form of consideration to be received, all other Stockholders shall be given the same option on the same terms; provided that, in the event that any securities are part of the consideration payable, each Stockholder that is not an “accredited investor” within the meaning of Rule 501 under the Securities Act may, in the sole discretion of the Board, receive, and hereby agrees to accept, in lieu of securities, cash consideration with an equivalent value to such Holder with respect securities as reasonably determined by the Board.
(d) Notwithstanding anything in this Section 6 to the contrary, if the Compellors or any representation and warranty made of their respective Representatives, directly or indirectly, receive any consideration from the Drag-Along Purchaser(s) or any of its Affiliates in connection with a compelled sale other than the Third Party Sale consideration that is received by all the several liability Stockholders on a pro rata basis as part of the compelled sale, then the Compellors shall cause each of the Compelled Stockholders to receive their pro rata share, determined by reference to the respective amounts of consideration otherwise payable to each Stockholder (including the Compellors) as part of the compelled sale, of such Holder consideration.
(and e) This Section 6 shall not joint with any other person) and that such liability is limited apply to Transfers of shares of Common Stock made pursuant to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawInitial Public Offering.
Appears in 2 contracts
Samples: Stockholders Agreement (Molycorp, Inc.), Stockholders Agreement (Molycorp, Inc.)
Drag Along Right. Notwithstanding any other provision hereof8.1 In the event that after March 13, if any Holder has not exercised its Tag2009 the Holders (as defined in Section 2.2(d)) holding more than 80% of the Series A Shares then in issue (on an as-Along Right with respect to converted basis) (the maximum number “Requisite Holders”) approve of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect the terms of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party written offer for a Trade Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and notify the Company of such approved offer, then, in any such event, each of holders of Series A Shares and the Ordinary Shareholders shall each consent to, vote for and raise no objections to the proposed Trade Sale, and (yi) if the Third Party proposed Trade Sale Percentageis structured as a merger, at consolidation or sale of assets, the same price holders of Series A Shares and the Ordinary Shareholders shall each waive any dissenters’ rights, appraisal rights or any similar rights in connection with such merger, consolidation or sale of assets, (ii) if the proposed Trade Sale is structured as a sale of shares, the holders of Series A Shares and the Ordinary Shareholders shall each agree to sell their shares in the capital of the Company on the same terms and conditions as such Selling Fortress Entity has agreed of the proposed Trade Sale that are approved by the Requisite Holders, and (iii) the holders of Series A Shares and the Ordinary Shareholders shall each take all necessary and desirable actions approved by the Requisite Holders in connection with the consummation of the proposed Trade Sale, including using commercially reasonable efforts to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that procure all other shareholders of the Company mayto consent to such sale as well as the execution of such agreements and such instruments and other actions reasonably necessary to (A) provide the representations, in its sole discretionwarranties, accelerate indemnities, covenants, conditions, non-compete agreements, escrow agreements and other provisions and agreements relating to such proposed Trade Sale and (B) effectuate the vesting allocation and distribution of any unvested Holder’s Shares); provided further that such Selling Fortress Entity the aggregate consideration upon the consummation of the proposed Trade Sale.
8.2 For purposes of this Agreement, an “Trade Sale” shall use its reasonable, good faith efforts to provide that mean (A) the only representation and warranty acquisition of the Company by another entity, or the acquisition by the Company of another entity, by means of any transaction or series of related transactions (including, without limitation, any reorganization, merger or consolidation) in which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect Company’s shareholders of record as constituted immediately prior to such Holderacquisition will, immediately after such acquisition (by virtue of securities issued as consideration for the Company’s own ownership acquisition or otherwise) fail to hold at least 50% of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear voting power of liens, encumbrances and adverse claims and the resulting or surviving corporation following such acquisition; (B) a sale of all or substantially all of the liability assets of the Company and/or the Group Companies; or (C) the grant of an exclusive license to all or substantially all of the Company’s or the other Group Companies’ intellectual property that is used to generate all or substantially all of the Group’s revenues, and in each case of (A), (B) and (C), the total proceeds of such Holder with respect to any representation and warranty made transaction(s) would result in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawmore than US$100 million.
Appears in 2 contracts
Samples: Shareholder Agreement (China Distance Education Holdings LTD), Shareholder Agreement (China Distance Education Holdings LTD)
Drag Along Right. Notwithstanding anything contained in this Article II to the contrary, at any other provision hereoftime prior to an IPO of the Company, if any Holder (i) a bona fide firm offer has not exercised its Tagbeen made by an unaffiliated third party to acquire at least sixty-Along Right with respect to six percent (66%) of the maximum number Spotify Securities, on a fully diluted basis (which, for purposes of Holder’s Shares for which such Holder is permitted (pursuant to this Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale2.07, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party means the number of whole Holder’s Spotify Shares issued and outstanding, together with the number of Spotify Shares issuable upon the exercise, conversion or exchange into Spotify Shares of all issued and outstanding Spotify Securities (rounded upwards excluding the Spotify Top-Up Options, the Convertible Notes and any Beneficiary Certificates) (such acquisition, a “Drag Transaction “) and (ii) the holders of Spotify Securities (the “Transferring Holders”) that (A) together beneficially own at least sixty-six percent (66%) of the outstanding Spotify Shares and (B) include at least one (1) of the Founders (the “Transferring Founder(s)”) accept such offer, the Transferring Founder(s) shall have the right, on behalf of the Transferring Holders, to require the Investors and their respective controlled Affiliates who beneficially own any Spotify Securities (the “Drag-Along Parties”) to Transfer all or downwards, as applicable), whether or not the restrictions on Transfer a portion of Common Stock have lapsed, equal their respective Spotify Securities to the product third party Transferee in such Drag Transaction, all in accordance with the following provisions:
(a) The Transferring Founder(s) shall, on behalf of the Transferring Holders, notify the Investors in writing of the proposed Drag Transaction no later than forty-five (x45) days prior to the total completion of the proposed Drag Transaction (the “Drag-Along Notice”). The Drag-Along Notice shall specify whether the Transferring Holders wish to exercise their drag-along rights pursuant to this Section 2.07 and set forth the identity of the proposed third party Transferee, the number of Holder’s Shares held Spotify Securities to be Transferred, the price per Spotify Security and the other terms and conditions for the Drag Transaction. The Drag-Along Notice shall be sent by such the Transferring Founder(s) on behalf of the Transferring Holders and shall also identify one Transferring Holder to whom the Investors shall send notices or other communications.
(b) If required by the Transferring Founder(s) on behalf of the date of Transferring Holders in the Drag-Along Notice (as defined below) and (y) Notice, the Third Party Sale Percentage, at Drag-Along Parties shall be obligated to Transfer Spotify Securities to the same price and third party Transferee in such Drag Transaction on the same terms and conditions (including at the same price (subject to adjustments to take into account the value of the Spotify Top-Up Options)) as the Transferring Holders. The Transferred Spotify Securities (being the Spotify Securities that the third party has offered to acquire) shall be allocated among the Transferring Holders and such Selling Fortress Entity has agreed Drag-Along Parties on a pro rata basis, calculated as the total number of Spotify Securities beneficially owned by the Drag-Along Parties in relation to with the total number of Spotify Securities beneficially owned by all Transferring Holders and the Drag-Along Parties, all on a fully diluted basis.
(c) If a Drag Transaction occurs pursuant to which the Drag-Along Parties are obligated to Transfer Spotify Securities as provided for in this Section 2.07 in exchange for securities other than cash and/or marketable securities (“non-marketable securities”), the Transferring Founder(s) and the Investors shall cooperate in good faith to procure that the issuer of such Third Party; providednon-marketable securities replicates the economic rights and other rights and priorities of the Drag-Along Parties immediately prior to such Transfer in its own capital structure.
(d) For the purposes of this Section 2.07, however, that each such Holder (i) DGE Investments shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is deemed a representation and warranty with respect to such Holder’s own ownership Founder should a majority of the Holder’s Shares to outstanding shares of DGE Investments no longer be sold ultimately held by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims Xxxxxx Xx and (Bii) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder Xxxxxxx shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion deemed a Founder should a majority of counsel to the effect that the Third Party Sale is not in violation outstanding shares of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated Xxxxxxx no longer be ultimately held by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawXxxxxx Xxxxxxxxx.
Appears in 2 contracts
Samples: Investor Agreement (Spotify Technology S.A.), Investor Agreement (Spotify Technology S.A.)
Drag Along Right. Notwithstanding any If a Selected Offer is approved in accordance with clause 11.2(viii) above, then the Board shall deliver or cause to be delivered to the bidder thereof (the “Approved Bidder”) a written notice of acceptance of the Selected Offer. The sale shall be closed within ten (10) Business Days from the date on which all required anti-trust and/or regulatory Authorizations have been cleared (the “Exit Completion Date”). Each Shareholder (other provision hereofthan a Relevant Bidder, if any Holder has not exercised its Tag-Along Right with respect to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicableany), whether if it voted in favor or not against the restrictions on Selected Offer shall be obligated to Transfer all of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s its Shares held by such Holder on the date of terms and conditions set forth in the Drag-Along Notice (as defined belowSelected Offer approved in accordance with clause 11.2(viii) above and (y) the Third Party Sale Percentage, at the same price and in any event on the same terms and conditions as such Selling Fortress Entity has agreed any other Shareholder (the “Exit Transaction”). Each Shareholder shall be further obligated,
(i) to with such Third Party; providedvote its Shares, however, that each such Holder shall not be permitted and instruct its nominated or co-nominated directors to sell any unvested Holder’s Shares (provided that the Company mayvote, in its sole discretion, accelerate the vesting favor of any unvested Holder’s Shares); provided further reasonable actions required or convenient to close the Exit Transaction with the Approved Bidder and, as a result, complete in full the Exit;
(ii) to waive any legal and contractual pre-emption rights that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make Shareholder may have in connection with the Third Party Sale is Exit Transaction; and
(iii) to enter into any agreements reasonably necessary to effect the Transfer of its Shares in the Exit Transaction and to agree (as to itself) to make on a representation several basis (mancomunadas) to the Approved Bidder the representations and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold warranties required by it under the Selected Offer, if any, and if so required by the Approved Bidder, at least, the following:
(a) such Shareholder has full right, title and interest in and to its ability Shares;
(b) such Shareholder has all necessary power and authority and has taken all necessary actions to convey title thereto Transfer its Shares as contemplated by this clause; and
(c) its Shares are free and clear of liens, encumbrances any and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale all Liens except pursuant to this Section 2(b)(iii) unless Agreement, and to discuss in good faith such Holder is provided an opinion other representations and warranties customary for sellers in this kind of counsel to transactions, as may be reasonably requested by the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawApproved Bidder.
Appears in 2 contracts
Drag Along Right. Notwithstanding any other provision hereof(a) If one or more Stockholders desire to Transfer at least 50.01% of the Voting Securities of the Company and, if any Holder solely for so long as Section 2.3(c)(xiii) requires such approval, such Transfer has not exercised its Tag-Along Right with respect to been approved by the maximum number of Holder’s Shares for which such Holder is permitted (Required Directors pursuant to Section 2(b)(ii)(B2.3(c)(xiii), then if requested by the Stockholder(s) above) to exercise Transferring such Tag-Along Right in respect of a Third Party Sale, then, upon Voting Securities (the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion“Section 3.5 Transferring Stockholder(s)”), such Holder other Stockholder (together with its Affiliates) (a “Selling Stockholder”) shall be required to sell all of the Equity Securities held by it (it being understood that the termination of the rights of any Stockholder under Section 2.3 shall not affect the obligations of such Stockholder under this Section 3.5).
(b) The consideration to be received by a Selling Stockholder shall be the respective Third Party same form and amount of consideration per share to be received by the number of whole Holder’s Shares (rounded upwards or downwards, as applicableSection 3.5 Transferring Stockholder(s), whether or not and the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions of such sale shall be the same as such those upon which the Section 3.5 Transferring Stockholder(s) sells its Equity Securities. In connection with the transaction contemplated by Section 3.5(a) (the “Drag Transaction”), the Selling Fortress Entity has agreed Stockholder will agree to with such Third Partymake or agree to the same customary representations, covenants, indemnities and agreements as the Section 3.5 Transferring Stockholder(s) so long as they are made severally and not jointly and the liabilities thereunder are borne on a pro rata basis based on the consideration to be received by each Stockholder; provided, however, that each such Holder shall any general indemnity given by the Transferring Stockholder(s), applicable to liabilities not be permitted specific to sell any unvested Holder’s Shares (provided that the Company maySection 3.5 Transferring Stockholder(s), in its sole discretion, accelerate to the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make purchaser in connection with such sale shall be apportioned among the Third Party Sale is Selling Stockholders according to the consideration received by each Selling Stockholder and shall not exceed such Selling Stockholder’s proceeds from the sale; provided, further, that any representation made by a representation and warranty with respect Selling Stockholder shall relate only to such Holder’s own ownership of the Holder’s Shares to be sold by it Selling Stockholder and its ability to convey title thereto free Equity Securities.
(c) The fees and clear of liensexpenses, encumbrances and adverse claims and (B) the liability of such Holder with respect other than those payable to any representation and warranty made Stockholder or any of their respective Affiliates, incurred in connection with a sale under this Section 3.5 and for the Third Party Sale is benefit of all Stockholders (it being understood that costs incurred by or on behalf of a Stockholder for his, her or its sole benefit will not be considered to be for the several liability benefit of such Holder (and not joint with any other person) and that such liability is limited all Stockholders), to the amount of proceeds actually extent not paid or reimbursed by the Company or the Transferee or acquiring Person, shall be shared by all the Stockholders on a pro rata basis, based on the consideration received by such Holder in the Third Party Saleeach Stockholder; provided further, that a Holder no Stockholder shall not be obligated to participate in make any Third Party Sale out-of-pocket expenditure prior to the consummation of the transaction consummated pursuant to this Section 2(b)(iii3.5 (excluding modest expenditures for postage, copies, etc.).
(d) unless such Holder is The Section 3.5 Transferring Stockholder(s) shall provide written notice (the “Drag Along Notice”) to each other Selling Stockholder of any proposed Drag Transaction as soon as practicable following its exercise of the rights provided in Section 3.5(a). The Drag Along Notice shall set forth the consideration to be paid by the purchaser for the securities and the material terms of the Drag Transaction.
(e) If any holders of Equity Securities of any class are given an opinion of counsel option as to the effect that form and amount of consideration to be received, all holders of Equity Securities of such class will be given the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect same option.
(f) At least ten (10) Business Days prior to the matters contemplated by this provisoconsummation of the sale, each Selling Fortress Entity who has delivered Stockholder shall deliver to the Company to hold in escrow pending transfer of the consideration therefor, the duly endorsed certificate or certificates representing the Equity Securities held by such Selling Stockholder to be sold, and a Dragstock power and limited power-Along Notice of-attorney authorizing the Company to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees take all actions necessary to vote its Holder’s Shares in favor sell or otherwise dispose of such merger securities. In the event that a Selling Stockholder should fail to deliver the Equity Securities, the Company shall cause the books and not records of the Company to exercise any rights show that such Equity Securities are bound by the provisions of appraisal or dissent afforded under applicable lawthis Section 3.5 and that such securities may only be Transferred to the purchaser in such Drag Transaction.
(g) Upon the consummation of the Drag Transaction, the acquiring Person shall remit directly to the Selling Stockholder, by wire transfer if available and if requested by the Selling Stockholder, the consideration for the securities sold pursuant thereto.
Appears in 2 contracts
Samples: Shareholder Agreement (Panamsat Corp /New/), Stockholders Agreement (PanAmSat Satellite HGS 3, Inc.)
Drag Along Right. Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect to In the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect event the holders of a Third Party Salemajority of the Company's equity securities then outstanding (the "Majority Shareholders") determine to sell or otherwise dispose of all or substantially all of the assets of the Company or all or fifty percent (50%) or more of the capital stock of the Company in each case in a transaction constituting a change in control of the Company, thento any non-Affiliate(s) of the Company or any of the Majority Shareholders, upon or to cause the demand Company to merge with or into or consolidate with any non-Affiliate(s) of the Company or any Selling Fortress Entity participating in such Third Party Sale of the Majority Shareholders (in each such entity’s sole discretioncase, the "Buyer") in a bona fide negotiated transaction (a "Sale"), such Holder the Optionee, including any Permitted Transferees, shall sell be obligated to and shall upon the written request of the Majority Shareholders (subject to Section 6): (a) sell, transfer and deliver, or cause to be sold, transferred and delivered, to the respective Third Party the number of whole Holder’s Buyer, his or her Issued Shares (rounded upwards including for this purpose all of such Optionee's or downwards, his or her Permitted Transferee's Issued Shares that presently or as applicable), whether or not a result of any such transaction may be acquired upon the restrictions on Transfer exercise of Common Stock have lapsed, equal to options (following the product of (x) the total number of Holder’s Shares held by such Holder on the date payment of the Drag-Along Notice (as defined belowexercise price therefor)) and (y) the Third Party Sale Percentage, at the same price and on substantially the same terms applicable to the Majority Shareholders (with appropriate adjustments to reflect the conversion of convertible securities, the redemption of redeemable securities and conditions the exercise of exercisable securities as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that well as the Company may, in its sole discretion, accelerate the vesting relative preferences and priorities of any unvested Holder’s Sharespreferred stock); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (Bb) the liability execute and deliver such instruments of conveyance and transfer and take such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of other actions, including voting such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Issued Shares in favor of such any Sale proposed by the Majority Shareholders and executing any purchase agreements, merger agreements, indemnity agreements, escrow agreements or related documents, as the Majority Shareholders or the Buyer may reasonably require in order to carry out the terms and not to exercise provisions of this Section 10. The obligations under this Section 10 shall terminate upon the Closing of the Company's Initial Public Offering or upon consummation of any rights Sale Event, in either case as a result of appraisal which shares of the Company (or dissent afforded successor entity) of the same class as the Issued Shares are registered under applicable lawSection 12 of the Exchange Act and publicly traded on NASDAQ/NMS or any national securities exchange.
Appears in 2 contracts
Samples: Incentive Stock Option Agreement (BladeLogic, Inc.), Non Qualified Stock Option Agreement (BladeLogic, Inc.)
Drag Along Right. Notwithstanding (a) If, at any other provision time following the fifth (5th) anniversary of the date hereof, if either Weider or TPG proposes to Transfer Beneficially Owned Shares in connection with a Qualified Change of Control, other than a Transfer by TPG to any Holder of its Affiliates, the party proposing such Transfer (the “Dragging Party”) shall have the right, exercisable upon ten (10) Business Days’ prior written notice to the other party (a “Drag-Along Sale Notice”), to require such other party (the “Non-Dragging Party”) to sell a number of Shares equal to its Pro Rata Portion, to the Proposed Transferee on the same terms and conditions, including the same price per Share as the Dragging Party. If such proposed Transfer has not exercised its Tag-Along Right with respect to been consummated by the maximum number end of Holder’s Shares for which such Holder is permitted the one hundred eightieth (pursuant to Section 2(b)(ii)(B180th) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on day after the date of delivery of the Drag-Along Sale Notice, such Drag-Along Sale Notice shall be null and void and the Non-Dragging Party shall be released from its obligations under this Section 4.4, and, in order to consummate a Transfer in accordance with this Section 4.4, it shall be necessary for the Dragging Party to deliver a separate Drag-Along Sale Notice, and the Dragging Party shall be required to separately comply with the terms and provisions of this Section 4.4.
(as defined belowb) and Upon receipt of a Drag-Along Sale Notice, the Non-Dragging Party agrees to cooperate in consummating the proposed Transfer, including, without limitation, by (yi) becoming a party to the Third Party Sale Percentage, at the same price and definitive documentation evidencing such Transfer on the same terms and conditions as the Transferring party (including purchase price per Share), (ii) delivering, at the consummation of such Selling Fortress Entity has agreed Transfer, the stock certificates and other instruments for such Shares duly endorsed for Transfer, free and clear of all Encumbrances, (iii) voting or consenting in favor of such transaction (to the extent a vote or consent is required), and (iv) taking any other commercially reasonable necessary or appropriate actions required to consummate the Transfer, including, without limitation, the execution and delivery of any other reasonably appropriate agreements, certificates, instruments, or other documents.
(c) Each of the Dragging Party and Non-Dragging Party shall be responsible for its proportionate share (apportioned pro rata based on the number of Shares to be sold pursuant to the Drag-Along Sale Notice) of all third-party expenses incurred in connection with such Third PartyTransfer (except to the extent such expenses may have previously been, or may be paid or reimbursed by the Company or the Proposed Transferee) and all liabilities for indemnification with respect to breaches of representations and warranties made in connection with such Transfer in respect of the Company or its Business (which liabilities shall include amounts paid into escrow or subject to holdbacks, and amounts subject to post-closing purchase price adjustments); provided, however, that that, all such liabilities shall be on a several and not joint basis, such liabilities to be apportioned based on the consideration received by each of the Dragging Party and Non-Dragging Party. Notwithstanding anything to the contrary set forth herein, (i) the aggregate amount of any such Holder liabilities or obligations for which the Non-Dragging Party shall be responsible shall not be permitted exceed the gross proceeds received by the Non-Dragging Party pursuant to sell any unvested Holder’s Shares such Transfer, and (provided that ii) neither the Company may, in its sole discretion, accelerate Dragging nor the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder Non-Dragging Party shall be required to make in connection with the Third Party Sale is a representation and warranty responsible for any indemnification obligations or liabilities (including, without limitation, by means of escrow or holdback arrangements) for breaches of representations or covenants, or for related escrow or holdback claims made with respect to such Holderother party’s own (u) ownership of or title to Shares, (v) organization, (w) authority, (x) conflicts or consents required to consummate the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear Transfer, or in respect of liens, encumbrances and adverse claims and (By) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received representation made by such Holder in other party concerning the Third Party Sale; provided furthersuch other party, that a Holder shall not be obligated to participate in or (z) for breaches of any Third Party Sale pursuant to this Section 2(b)(iii) unless covenant specifically made by such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawparty.
Appears in 2 contracts
Samples: Stockholders Agreement (Tarrant Capital Advisors, Inc.), Stockholders Agreement (Schiff Nutrition International, Inc.)
Drag Along Right. Notwithstanding 8.1 If the Company or the Company’s stockholders receive a bona fide Public Offer from a third party (which will not include any Offer by an Affiliate of the Company or any Group Company) and (i) the management board and supervisory boards of the Company have endorsed, approved, recommended or otherwise supported such Public Offer, (ii) the holders of at least 70% of all issued and outstanding Company Voting Securities (including those held by Investor and/or its Affiliates) have tendered their shares to the third party in connection with such Public Offer (a Public Offer meeting the requirements of clauses (i) and (ii) being an Approved Public Offer) and (iii) Investor and/or any of its Affiliates do not have a bona fide matching (x) counter Public Offer to the Company’s shareholders or (y) other Business Combination Proposal with the Company pending, Investor and its Affiliates shall agree to tender and sell all of their Ordinary Shares and/or ADS in such Public Offer pursuant to this Section 8 to the extent permitted by applicable law and the terms of the Approved Public Offer.
8.2 The Company shall provide Investor a reasonable detailed description of the Approved Public Offer, including (i) the proposed time and place of closing, (ii) the consideration to be received by the stockholders, (iii) the name and address of the person making the Approved Public Offer, (iv) any other provision hereofmaterial terms of the Approved Public Offer (to the extent not sufficiently set out in the offer document related to the approved Public Offer) and (v) confirmation that the Public Offer is an Approved Public Offer (the Public Offer Notice).
8.3 Within two (2) Business Days of receipt of such Public Offer Notice, if any Holder has the offeror declares the Approved Public Offer unconditional in accordance with the Dutch offer rules, Investor shall agree, subject to Section 8.1 above, to tender all of its Ordinary Shares and/or ADS on the terms and conditions of the Approved Public Offer to the extent permitted by applicable law and the terms of the Approved Offer; provided that the payment and other terms applicable to Investor in the Approved Public Offer may not exercised be less favourable to Investor than the terms offered to the other holders of Ordinary Shares and/or ADS; and provided further that Investor shall still be entitled to receive the Anti-Dilution Amount in the event that the Approved Public Offer would result in a Anti-Dilution Acquisition Event in accordance with Section 7.
8.4 Investor shall take all reasonably necessary actions to consummate the sale of its Tag-Along Right Ordinary Shares and/or ADS on the terms and conditions set forth in Section 8.3.
8.5 For the avoidance of doubt, except as specifically set forth in this Section 8, Investor and its Affiliates will retain their rights to vote the Shares and make all decisions with respect to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability divestiture of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawShares.
Appears in 2 contracts
Samples: Shareholder Agreement (Johnson & Johnson), Shareholder Agreement (Crucell Nv)
Drag Along Right. Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect to the maximum number of Holder’s Common Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above3(b)(ii)(b)) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s its sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares shares of Common Stock (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares shares of Common Stock held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares shares of Common Stock to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii3(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling respective Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares shares of Common Stock in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable law.
Appears in 2 contracts
Samples: Management Shareholder Agreement (Seacastle Inc.), Management Shareholder Agreement (Seacastle Inc.)
Drag Along Right. Notwithstanding any other provision hereof(a) Prior to an IPO, if any Holder has Person or group (within the meaning of Section 13(d) of the Exchange Act) of Persons who is not exercised its Tagan Affiliate of AIG (such Person or group, a “Drag- Along Acquirer”) offers to acquire an amount of shares of Company Common Stock (whether in connection with a merger or consolidation of the Company, an offer to purchase shares directed to all stockholders, or otherwise) in a transaction that would constitute a Change of Control of the Company (a “Drag-Along Right Sale”), then (i) AIG may deliver to the Stockholder a written notice with respect to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such TagDrag-Along Right in respect of Sale (a Third Party Sale, then, upon “Drag-Along Notice”) and (ii) the demand of any Selling Fortress Entity participating Stockholder shall thereafter be required to participate in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder transaction on the date same terms and conditions as AIG in accordance with the provisions of this Section 5.2.
(b) The Drag-Along Notice will include the material terms and conditions of the Drag-Along Notice Sale, including (as defined belowi) the identity of the Drag-Along Acquirer, (ii) the aggregate transaction value, the per share price and the form of consideration (or the right to elect the form of consideration) to be received by AIG and the Stockholder and any other material terms and conditions of the proposed Drag-Along Sale (which per share price and form of consideration (or the right to elect the form of consideration) and other material terms and conditions shall be the same for AIG and the Stockholder and, if such consideration consists in part or in whole of properties, assets or rights other than cash, AIG will provide such information relating to such non-cash consideration as is available to AIG (yprovided that information available to AIG upon request shall be deemed to be available) and the Stockholder may reasonably request in order to evaluate such non-cash consideration), (iii) the Third Party date of anticipated closing of the proposed Drag- Along Sale Percentage(which shall not be less than ten (10) Business Days after the date the Drag-Along Notice is delivered), (iv) the action or actions required of the Stockholder in order to complete or facilitate such proposed Drag Along Sale, (v) a percentage, expressed as a fraction, the numerator of which is the number of shares of Company Common Stock which AIG intends to Sell in such Drag-Along Sale and the denominator of which is the total number of outstanding shares of Company Common Stock then Beneficially Owned by AIG and (vi) copies of the definitive transaction documents relating to the Drag-Along Sale.
(c) In connection with a Drag-Along Sale, the Stockholder shall be obligated to (i) vote all of such Stockholder’s shares in favor of the Drag-Along Sale, to the extent the consummation of such sale requires stockholder approval, and shall take any other action reasonably required to waive any dissenters’ rights or rights of appraisal under applicable law (including Section 262 of the Delaware General Corporation Law), (ii) transfer, at the same price time and place and on the same terms and conditions as AIG (including with the same right to elect the form of consideration as is offered to AIG), a number of shares of Company Common Stock equal to (A) the number of shares of Company Common Stock which the Stockholder then Beneficially Owns multiplied by (B) a fraction, the numerator of which is the number of shares of Company Common Stock which AIG intends to Sell in such Selling Fortress Entity has agreed Drag-Along Sale and the denominator of which is the total number of outstanding shares of Company Common Stock then Beneficially Owned by AIG, and (iii) execute and deliver all documents reasonably necessary to with effectuate such Third Partytransaction; providedprovided that, howevernotwithstanding the foregoing or anything to the contrary set forth in this Section 5.2, that each such Holder (1) the Stockholder shall not be permitted subject to sell any unvested Holder’s Shares non-compete covenant, non-solicitation covenant or other similar provision that would bind or purport to restrict the Stockholder or any of its Affiliates, including any restriction or limitation on the ability of the Stockholder or any of its Affiliates to invest in any other Person (it being understood that the Stockholder may be subject to confidentiality restrictions (and with the benefit of any exceptions) on the same terms as AIG), (2) the Stockholder shall not be required to make representations and warranties or covenants or provide indemnities as to any other Person participating in such Drag-Along Sale and the Stockholder shall not be required to make any representations or warranties (but, subject to clause (4) of this proviso, may be required to provide several but not joint indemnities with respect to breaches of representations and warranties made by the Company) about the Company Business (it being understood that the Stockholder may be required to make customary representations and warranties as to its ownership of shares of Company Common Stock, authority, power and legal right to enter into and consummate a purchase or merger agreement and as to whether it has engaged a broker in connection with any such transaction); (3) the Stockholder shall not be liable for the breach of any covenant by any other holder of Company Common Stock or the Company (but shall bear liability severally for breach of any representation, warranty or covenant made specifically by it or relating to its specific ownership of shares of Company Common Stock); and (4) liability relating to representations, warranties and covenants (and related indemnities) and other indemnification obligations regarding the Company Business assumed in connection with the Drag-Along Sale shall be shared by AIG and the Stockholder severally and not jointly pro rata in proportion to the number of shares of Company Common Stock actually transferred by AIG and the Stockholder in such Drag-Along Sale and, in any event, in the case of the Stockholder, shall not exceed the proceeds actually received by the Stockholder in such Drag-Along Sale.
(d) If AIG is offered the opportunity in a Drag-Along Sale to receive all or a portion of its consideration in the form of securities of the Drag-Along Acquirer or an Affiliate thereof, or otherwise to rollover or contribute its shares of Company Common Stock immediately prior to the consummation of such Drag-Along Sale into securities of the Drag-Along Acquirer or any Affiliate thereof, then AIG shall make provision so that the Stockholder shall be offered the same opportunity in such Drag-Along Sale (irrespective of any rollover election, if applicable, made by AIG with respect to such transaction).
(e) At the closing of any Drag-Along Sale, the Stockholder shall deliver, against receipt of the consideration specified in the Drag-Along Notice, any certificates representing the shares of Company Common Stock which such Stockholder Beneficially Owns, with all endorsements necessary for transfer; provided that the Company maywill return, in its sole discretionor cause the return of, accelerate such certificates promptly upon the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability termination of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a proposed Drag-Along Notice to Sale or the determination that such Holder proposed Drag-Along Sale will not be consummated.
(f) The provisions of this Section 5.2 shall indemnify such Holder for any such violation. If terminate upon the Third Party Sale is in the form closing of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawan IPO.
Appears in 2 contracts
Samples: Stockholders Agreement (SAFG Retirement Services, Inc.), Stockholders Agreement (SAFG Retirement Services, Inc.)
Drag Along Right. Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect to (a) If both (a) the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect holders of a Third Party Sale, then, upon majority of the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer issued and outstanding shares of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder voting together as a single class on the date of the Dragan as-Along Notice (as defined belowconverted basis) and (yb) the Third Party holders of a majority of the issued and outstanding shares of Class D Common Stock (each voting as a separate class) approve a sale of the Company or all or substantially all of the Company’s assets, whether by means of a merger, consolidation, the sale of capital stock, or otherwise (an “Approved Sale”), then each Investor and the Key Holder hereby agrees to consent to, vote for and raise no objections to the Approved Sale, and (i) shall each waive any and all dissenters rights, appraisal rights or similar rights in connection with such Approved Sale, or (ii) if the Approved Sale Percentageis structured as a sale of the outstanding capital stock of the Company, at the same price each Investor and Key Holder hereby agrees to sell his, her or its Common Stock on the same terms and conditions as such Selling Fortress Entity has agreed approved by the stockholders described in subclauses (a) and (b) above (the “Approving Stockholders”). Each Investor and Key Holder agrees to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that take all necessary and desirable actions approved by the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make Approving Stockholders in connection with the Third Party Sale is a representation consummation of an Approved Sale, including the execution of such agreements and warranty with respect such instruments and other actions reasonably necessary to (A) provide the representations, warranties, indemnities, covenants, conditions, escrow agreements and other provisions and agreements relating to such Holder’s Approved Sale, provided that such representations, warranties and covenants are made solely by each Investor or Key Holder for his, her or its own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims account; and (B) effectuate the liability allocation and distribution of such Holder with respect the aggregate consideration upon the consummation of the Approved Sale. Notwithstanding any provision of this Section 5.4 to any representation the contrary, the Investors and warranty made in connection with the Third Party Key Holders shall have no obligation under this Section 5.4 unless the aggregate consideration payable upon the consummation of the Approved Sale is to be allocated and distributed in accordance with Article Fourth, Subsection B.2 of the several liability of Company’s Restated Certificate; each X. Xxxx Price Investor shall have no obligation under this Section 5.4 unless the Approved Sale provides for payment at closing sufficient to return the Class D Original Issue Price (as such Holder (and not joint with any other person) and that such liability term is limited to the amount of proceeds actually received by such Holder defined in the Third Party SaleRestated Certificate) on each share of Class D Common Stock; provided further, that a Holder Deerfield and Roche shall not be obligated to participate in any Third Party Sale pursuant to have no obligation under this Section 2(b)(iii) 5.4 unless the Approved Sale provides for payment at closing sufficient to return the Class C Original Issue Price (as such Holder term is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is defined in the form Restated Certificate) on each share of a merger transaction, Class C Common Stock; and PBM and the PBM Co-Investors shall have no obligation under this Section 5.4 unless the Approved Sale provides for payment at closing sufficient to return the Class B Original Issue Price (as such term is defined in the Restated Certificate) on each Holder agrees to vote its Holder’s Shares in favor share of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawClass B Common Stock.
Appears in 2 contracts
Samples: Investor Rights Agreement (AveXis, Inc.), Investor Rights Agreement (AveXis, Inc.)
Drag Along Right. Notwithstanding any other provision hereof(a) Subject to Section 5.7(f) (as modified by Section 9.4) and subject to complying with the procedures set forth in Section 9.4 in all material respects, if prior to a Change of Control Event, the Greystone Member or, following a Change of Control Event, the C&W Member (as applicable, the “Dragging Member”) desires to Transfer (which for the avoidance of doubt, shall exclude any Holder has not exercised its Tag-Along Right with respect Transfer to a Permitted Transferee) at least a majority in the maximum number aggregate of Holder’s Shares for which such Holder is permitted (pursuant the issued and outstanding Class A Units to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Salein an arm’s-length transaction at a price per Unit that is at least the Fair Market Value per Unit, thenas finally determined in accordance with Section 9.10, upon it being understood that the demand Dragging Member may initiate such Section 9.10 Fair Market Value process in advance of any Selling Fortress Entity participating such transaction to determine such minimum Fair Market Value per Unit that will serve as the floor price for such transaction (such transaction, a “Drag Transaction”), then the Dragging Member may at its sole option require each other Member (a “Dragged Member”), and each Dragged Member hereby agrees, if (x) such Drag Transaction is structured as a Transfer of Class A Units, whether by sale of Class A Units, merger, consolidation, recapitalization, reclassification or similar transaction and (y) such Drag Transaction is entered into and approved in compliance with this Agreement, including the provisions and limitations set forth in this Section 9.6, to (1) Transfer in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party Drag Transaction the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, Class A Units equal to the product of (xi) the number of Class A Units beneficially owned by such Dragged Member as of the applicable Transfer date and (ii) a fraction (A) the numerator of which is the number of Class A Units that the Dragging Member proposes to Transfer and (B) the denominator of which is the total number of Holder’s Shares held Class A Units beneficially owned by the Dragging Member as of such Holder date at the same purchase price per Class A Units as the Dragging Member and otherwise on the same terms and conditions as are applicable to the Dragging Member; and (2) otherwise vote in favor of and consent to the Drag Transaction and in opposition to any and all other proposals that could reasonably be expected to delay or impair the ability to consummate such Drag Transaction and refrain from asserting any claim or commencing any suit challenging such Drag Transaction (unless such suit alleges that such Drag Transaction does not comply with the principles set forth in this Section 9.6) or the application of this Section 9.6 to such Drag Transaction.
(b) The Dragging Member shall provide written notice (the “Drag-Along Notice”) to each Dragged Member of any proposed Drag Transaction as promptly as practicable prior to the proposed date of the consummation of any such Drag Transaction but in no event less than fifteen (15) Business Days prior to the consummation of any such Drag Transaction. The Drag-Along Notice shall identify (i) the number of and class of Units proposed to be sold by the Dragging Member, (ii) the Dragged Member, (iii) the amount and form of consideration for which the Transfer is proposed to be made and the proposed Transfer date (which for the avoidance of doubt, shall represent cash or Marketable Securities in respect of such Dragged Member) and (iv) to the extent available, a summary of all other material terms and conditions of the Drag Transaction (as reasonably determined in good faith by the Dragging Member) and the then current drafts of forms of all agreements to be entered into by the Members participating in the Drag Transaction. The consideration to be received by a Dragged Member shall be (i) the same form and amount of consideration per Unit (by class of Unit) to be received by the Dragging Member and (ii) in the form of cash and/or Marketable Securities. The terms and conditions of such sale shall be the same as those upon which the Dragging Member sells its Units.
(c) If, at the end of the 120-day period beginning on the date of the Dragged Member’s receipt of the Drag-Along Notice (as defined belowwhich 120-day period shall be extended, if any of the transactions contemplated by the Drag Transaction are subject to regulatory approval, until the earlier of (x) the expiration of five Business Days after all such approvals have been received and (y) the Third Party Sale Percentagedate that is 240 days after the date of receipt of the Drag-Along Notice), at the same price and Drag Transaction has not been consummated on the same terms and conditions set forth in the Drag-Along Notice, the Dragging Member shall (i) promptly return to each Dragged Member any documents in the possession of the Dragging Member executed by such Dragged Member in connection with the proposed Drag Transaction, and (ii) all the restrictions on Transfer contained in this Agreement or otherwise applicable at such time with respect to such Class A Units owned by such Dragged Member and Dragging Member shall again be in effect including any applicable requirement to comply with Section 9.4, Section 9.5 and Section 9.6.
(d) In connection with the consummation of the Drag Transaction, each Dragged Member shall deliver to the Company to hold in escrow pending transfer of the consideration therefor, any agreements or other documents reasonably required from such Dragged Member to consummate such Drag Transaction. In the event that a Dragged Member should fail to deliver the Units or documents described herein, the Company shall cause the books and records of the Company to show that such Units are bound by the provisions of this Section 9.6 and that such Units may only be Transferred to the purchaser in such Drag Transaction. Upon the consummation of the Drag Transaction, the acquiring Person shall pay directly to each Dragged Member, by wire transfer of immediately available funds, the purchase price for the Units sold by such Dragged Member pursuant thereto.
(e) In connection with a Drag Transaction, each Dragged Member will (i) be required to make the same customary representations, covenants, indemnities and enter into the same agreements as the Dragging Member so long as they are made severally and not jointly and the liabilities thereunder are borne on a pro rata basis based on the number of Units sold by each Member, (ii) shall benefit from and be subject to all of the same provisions of the definitive agreements as are applicable to the Dragging Member (other than in respect of any right or obligation of such Selling Fortress Entity has agreed Dragging Member in its capacity as an employee, service provider or executive), (iii) not be required to make any capital contribution or other investment in connection with such Third PartyDrag Transaction and (iv) will only be required to bear no more than its proportionate share (pro rata based on the consideration to be received in such Transfer) of any escrows, holdbacks or adjustments in respect of the purchase price or indemnification obligations to which Dragging Member and the Dragged Member are subject; provided, however, that (A) any indemnity given by the Dragging Member to the purchaser in connection with such sale, applicable to liabilities not specific to the Dragging Member, shall be apportioned among the Dragging Member and the Dragged Members according to the number of Units sold by each party and shall not exceed such Holder party’s proceeds from the Drag Transaction; (B) a Dragged Member or a Dragging Member shall not be permitted to sell responsible for breaches of representations and warranties made by any unvested Holder’s Shares other seller; (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (AC) the only representation and warranty which such Holder no Dragged Member shall be required to make in connection with or provide any representations, warranties covenants or indemnities (other than its proportionate share described above) relating to the Third Party Sale is a representation and warranty Units other than customary provisions with respect to such HolderDragged Member’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto Transfer its Units free and clear of liensliens (other than any applicable liens under applicable securities Law or under this Agreement), encumbrances due organization, authorization and adverse claims enforceability and absence of consents or conflicts with laws or agreements of such Dragged Member and a customary letter of transmittal and (BD) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder Dragged Member shall not be obligated to participate enter into any restrictive covenants (other than customary confidentiality restrictions).
(f) Concurrently with or promptly following the consummation of the Drag Transaction, the Dragging Member (i) shall give notice thereof to the Dragged Member, (ii) shall remit or cause to be remitted to each Dragged Member the total consideration to be paid at the closing of the Drag Transaction by wire transfer of immediately available funds in accordance with such Dragged Member’s wire transfer instructions for the Class A Units Transferred by such Dragged Member pursuant hereto, and (iii) shall furnish such other evidence of the completion and time of completion of such Transfer and the terms thereof as may be reasonably requested in writing by the Dragged Member.
(g) The fees and expenses incurred in connection with Drag Transaction and for the benefit of the Dragging Member and all Dragged Members (it being understood that costs incurred by or on behalf of a Dragged Member for his, her or its sole benefit will not be considered to be for the benefit of all Dragged Members), to the extent not paid or reimbursed by the Company or the Transferee or acquiring Person, shall be shared by the Dragging Member and all Dragged Members on a pro rata basis, based on the consideration received by each such party; provided, that no Dragged Member shall be obligated to make any Third Party Sale pursuant out-of-pocket expenditure prior to the consummation of the Drag Transaction (excluding modest expenditures for postage, copies, etc.).
(h) Nothing in this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to 9.6 shall limit the effect that C&W Member’s or the Third Party Sale is not Greystone’s Member’s rights set forth in violation of applicable federal and state securities or other laws orSection 9.4(e), if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawapplicable.
Appears in 2 contracts
Samples: Limited Liability Company Agreement (Cushman & Wakefield PLC), Contribution Agreement (Cushman & Wakefield PLC)
Drag Along Right. Notwithstanding (a) After the Lock-up Expiration Date, except for any other provision hereofTransfer to a Permitted Transferee, if any Holder has not exercised its TagPrincipal Investor or group of Principal Investors desires to make a Transfer of Sunnova Securities constituting seventy-Along Right with respect to five percent (75%) or more of the maximum number of Holder’s Shares for which such Holder is permitted outstanding Series A Common Stock (pursuant to Section 2(b)(ii)(B) aboveon a fully-diluted, as-converted basis) to exercise any third party and such Tag-Along Right in respect Transferring Investor(s) has satisfied the requirements of a Third Party SaleSection 3.4, then, upon each remaining Investor (the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the “Drag-Along Notice (as defined belowInvestors”) and (y) the Third Party Sale Percentageshall, at the same price option of the Transferring Investor(s) (the “Drag-Along Right”), Transfer their Sunnova Securities (including Series B Common Stock issuable upon exercise of any Vested Options and any options that vest as a result of the consummation of the Transfer to the third party but not including any Series B Common Stock issuable upon exercise of any unvested Options) on the same terms and conditions as the Transfer of Offered Securities in the proposed Transfer (a “Drag-Along Sale”). The Company may require a Management Investor that is a Drag-Along Investor to exercise such Selling Fortress Entity has agreed Management Investor’s Vested Options, in whole or in part, prior to or simultaneously with the closing of any transaction or transactions described in this Section 3.5. If the Transferring Investor(s) elects to exercise its Drag-Along Right under this Section 3.5, then it shall so notify each Drag-Along Investor in writing (“Drag-Along Notice”). Each Drag-Along Notice shall (i) set forth the number of Offered Securities, (ii) specify in reasonable detail the identity of the Offeror, (iii) specify in reasonable detail the amount and type of consideration (including, if the consideration consists in whole or in part of non-cash consideration, such Third Party; provided, however, that each such Holder shall not information available to the Transferring Investor as may be permitted to sell any unvested Holder’s Shares (provided that reasonably necessary for the Drag-Along Investors and the Company mayto properly analyze the economic value and investment risk of such non-cash consideration) and (iv) specify any other material terms and conditions of the proposed Transfer. Upon receipt of any Drag-Along Notice, each Drag-Along Investor shall, subject to the provisions of this Section 3.5, cooperate and use its commercially reasonable efforts to facilitate the Transfer and shall sign such instruments and take such action as may be reasonably required to consummate the Transfer. If, and only if, a Drag-Along Investor breaches the immediately preceding sentence and has not cured such breach within five (5) Business Days after receipt of written notice thereof from the Transferring Investor with a specific explanation of the alleged breach and the required corrective action (such notice a “Drag Breach Notice” and such Drag-Along Investor, a “Drag Breaching Investor”), then such Drag Breaching Investor is deemed to hereby make, constitute and appoint the Transferring Investor, with full power of substitution and re-substitution, as such Drag Breaching Investor’s true and lawful attorney-in-fact for it and in its name, place and stead and for its use and benefit, to sign, execute, certify, acknowledge, swear to, file and record any and all documents and to take any actions to the extent required to be taken by the Drag Breaching Investor pursuant to the immediately preceding sentence and set forth in the Drag Breach Notice. The parties hereto acknowledge that any such power of attorney is coupled with an interest and is irrevocable. Notwithstanding the foregoing, in its sole discretionthe event that more than fifty percent (50%) of the proceeds to be received by the Drag-Along Investors is not cash, accelerate the vesting Transferring Investor will not have the right to exercise the Drag-Along Right unless approved by a Board Supermajority.
(b) The proceeds of any unvested Holder’s Shares); provided further that such Selling Fortress Entity the Drag-Along Sale shall use its reasonable, good faith efforts be allocated to provide that the Transferring Investors and the Drag-Along Investors in accordance with Article IV.3(b) of the Restated Certificate as if (A) such transfer were a Deemed Liquidation Event (as defined in the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims Restated Certificate) and (B) the liability Offered Securities sold in accordance with this Section 3.5 were the only Sunnova Securities outstanding. For purposes of such Holder this Section 3.5(b), a Management Investor that [***] = Certain confidential information contained in this document, marked by brackets, is filed with the Securities and Exchange Commission pursuant to Rule 406 of the Securities Act of 1933, as amended. holds Vested Options that are not exercised prior to or simultaneously with the closing of the transaction shall receive, with respect to any representation and warranty made in connection with such Vested Options, the Third Party Sale is the several liability of such Holder (and not joint with any other person) and consideration that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not would otherwise be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion payable with respect to the matters contemplated by this provisoshares of Series B Common Stock underlying such Vested Options, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If minus the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor aggregate exercise price of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawVested Options.
Appears in 2 contracts
Samples: First Supplemental Indenture (Sunnova Energy International Inc.), First Supplemental Indenture (Sunnova Energy International Inc.)
Drag Along Right. Notwithstanding any other provision hereof(a) During the Post-Call Option Period until the completion of a Qualified Public Offering, if Gibco (acting at the direction of the KKR Principal Investors) proposes to sell or otherwise effect a sale or other Transfer of all or any Holder has not exercised number of its Tag-Along Right Shares (other than to a Permitted Transferee) (a “Required Sale”), then Gibco (acting at the direction of the KKR Principal Investors) may deliver a written notice to Walgreens (a “Required Sale Notice”) with respect to such proposed Required Sale as soon as practicable but in any event at least 20 Business Days prior to the maximum number anticipated closing date of Holder’s Shares for which such Holder is permitted Required Sale. If Gibco (pursuant to acting at the direction of the KKR Principal Investors) does not exercise its rights under this Section 2(b)(ii)(B) above) to exercise such Tag-Along Right 3.6 in respect of a Third Party Transfer, such Transfer will be subject to Section 3.5.
(b) The Required Sale Notice will include the material terms and conditions of the Required Sale, thenincluding (i) the name and address of the proposed transferee, upon (ii) the demand proposed amount and form of any Selling Fortress Entity participating consideration (and if such consideration consists in part or in whole of property other than cash, Gibco will provide such Third Party Sale information, to the extent reasonably available to Gibco (in each including using reasonable efforts to obtain such entity’s sole discretioninformation from the proposed transferee, if applicable), relating to such Holder shall sell non-cash consideration as Walgreens may reasonably request in order to evaluate such non-cash consideration), (iii) the respective Third Party proposed Transfer date, if known, and (iv) the number of whole Holder’s Shares to be sold by Gibco. Gibco will deliver or cause to be delivered to Walgreens copies of all transaction documents relating to the Required Sale promptly as the same become available.
(rounded upwards c) Walgreens, upon receipt of a Required Sale Notice, shall be obligated: to sell or downwards, as applicable), whether or not the restrictions on otherwise Transfer a percentage of Common Stock have lapsed, its Shares equal to the product corresponding percentage that Gibco is proposing to Transfer under the Required Sale, and participate in the Required Sale; to vote, if required by this Agreement or otherwise, its Shares in favor of the Required Sale at any meeting of shareholders called to vote on or approve the Required Sale and/or to consent in writing to the Required Sale; subject to applicable Law, to cause any Walgreens Designated Directors serving on the Company Board to vote in favor of the Required Sale in a vote among the Company Board called to vote on or approve the Required Sale and/or to consent in writing to the Required Sale; to waive all dissenters’ or appraisal or similar rights, if any, in connection with the Required Sale; to enter into agreements relating to the Required Sale (including instruments of conveyance and transfer, and any purchase agreements, merger agreements, indemnity agreements and escrow agreements, to the extent also entered into by Gibco and as Gibco may reasonably require, in order to carry out the terms of this Section 3.6); to agree (as to itself) to make to the proposed purchaser the same representations, warranties, covenants and indemnities to the same extent, mutatis mutandis, as Gibco agrees to make in connection with the Required Sale; and to use commercially reasonable efforts to take or cause to be taken all other actions as may be reasonably necessary to consummate the Required Sale (provided, that Walgreens shall not be required pursuant to this Section 3.6 to agree to any divestitures or restrictions or similar actions or agreements in connection with any required approval of an antitrust or other Governmental Authority in connection therewith); provided, that (x) unless otherwise agreed, Walgreens may not be required to make representations and warranties or provide indemnities as to Gibco or any other Shareholder and Walgreens shall not be required to make any representations and warranties (but, subject to clause (z) below, shall be required to provide several but not joint indemnities with respect to breaches of representations and warranties made by the total number of Holder’s Shares held by such Holder on Company or its Subsidiaries) about the date business of the Drag-Along Notice (as defined below) and Company or its Subsidiaries, (y) Walgreens shall not be liable for the Third Party breach of any covenant by Gibco or any other Shareholder and (z) notwithstanding anything in this Section 3.6(c) to the contrary, any liability relating to representations and warranties and covenants (and related indemnities) and other indemnification obligations regarding the business of the Company or its Subsidiaries assumed in connection with the Required Sale Percentageshall be shared by all Shareholders based on their respective Sharing Percentages and in any event shall not exceed with respect to any Shareholder the proceeds received by such Shareholder in the Required Sale.
(d) In the event that the proposed transferee in any Required Sale is a Walgreens Specified Person, at then the same price and on Walgreens Designated Directors shall not attend or participate in any discussions of the same terms and conditions as Company Board with respect to such Selling Fortress Entity has agreed to with such Third PartyRequired Sale; provided, howeverthat, for the avoidance of doubt, any such Transfer to a Walgreens Specified Person shall be prohibited under this Agreement unless in accordance with the requirements of clause (y) of Section 3.2(e).
(e) Any expenses incurred for the benefit of the Company or all Shareholders, and any indemnities, holdbacks, escrows and similar items relating to the Required Sale, that each such Holder shall are not be permitted to sell any unvested Holder’s Shares (provided that paid or established by the Company may(other than those that relate to representations or indemnities concerning a Shareholder’s valid ownership of its Shares free and clear of all Encumbrances or a Shareholder’s authority, power and legal right to enter into and consummate a purchase or merger agreement or ancillary documentation) shall be paid or established by the Shareholders in accordance with their respective Sharing Percentages.
(f) Gibco (acting at the direction of the KKR Principal Investors) shall, in its sole discretion, accelerate decide whether or not to pursue, consummate, postpone or abandon any Required Sale and, subject to the vesting Required Sale Notice and the other terms of this Section 3.6, the terms and conditions thereof. No Shareholder or any Affiliate of any unvested Holder’s Shares); provided further that such Selling Fortress Entity Shareholder shall use its reasonablehave any liability to any other Shareholder or the Company arising from, good faith efforts relating to provide that (A) the only representation and warranty which such Holder shall be required to make or in connection with the Third Party pursuit, consummation, postponement, abandonment or terms and conditions of any Required Sale is a representation and warranty except to the extent such Shareholder, or such Required Sale, shall have failed to comply with respect to such Holderthe provisions of this Section 3.6.
(g) Following Gibco’s own ownership delivery (acting at the direction of the Holder’s Shares KKR Principal Investors) of a Required Sale Notice, Walgreens shall be permitted to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited make proposals to the amount of proceeds actually received by such Holder in Company Board for alternative transactions to the Third Party applicable proposed Required Sale; provided furtherprovided, that a Holder Gibco (acting at the direction of the KKR Principal Investors) shall solely control the sale process and, without limiting the rights of any Director hereunder, Walgreens shall not be obligated have any right to participate in such process other than the making of any Third Party Sale pursuant to such proposal or as otherwise set forth in this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable law3.6.
Appears in 2 contracts
Samples: Shareholders’ Agreement (Walgreen Co), Purchase and Option Agreement (Walgreen Co)
Drag Along Right. Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect to In the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect event the holders of a Third Party Salemajority of the Company’s equity securities then outstanding (the “Majority Shareholders”) determine to sell or otherwise dispose of all or substantially all of the assets of the Company or all or fifty percent (50%) or more of the capital stock of the Company in each case in a transaction constituting a change in control of the Company, thento any non-Affiliate(s) of the Company or any of the Majority Shareholders, upon or to cause the demand Company to merge with or into or consolidate with any non-Affiliate(s) of the Company or any Selling Fortress Entity participating in such Third Party Sale of the Majority Shareholders (in each such entity’s sole discretioncase, the “Buyer”) in a bona fide negotiated transaction (a “Sale”), such Holder the Optionee, including any Permitted Transferees, shall sell be obligated to and shall upon the written request of a Majority Shareholders (subject to Section 6): (a) sell, transfer and deliver, or cause to be sold, transferred and delivered, to the respective Third Party the number of whole Holder’s Buyer, his or her Issued Shares (rounded upwards including for this purpose all of such Optionee’s or downwards, his or her Permitted Transferee’s Issued Shares that presently or as applicable), whether or not a result of any such transaction may be acquired upon the restrictions on Transfer exercise of Common Stock have lapsed, equal to options (following the product of (x) the total number of Holder’s Shares held by such Holder on the date payment of the Drag-Along Notice (as defined belowexercise price therefor)) and (y) the Third Party Sale Percentage, at the same price and on substantially the same terms applicable to the Majority Shareholders (with appropriate adjustments to reflect the conversion of convertible securities, the redemption of redeemable securities and conditions the exercise of exercisable securities as well as the relative preferences and priorities of preferred stock); and (b) execute and deliver such Selling Fortress Entity has agreed instruments of conveyance and transfer and take such other action, including voting such Issued Shares in favor of any Sale proposed by the Majority Shareholders and executing any purchase agreements, merger agreements, indemnity agreements, escrow agreements or related documents, as the Majority Shareholders or the Buyer may reasonably require in order to carry out the terms and provisions of this Section 11. Notwithstanding the foregoing, in connection with any Sale the Optionee shall not be required to make any representations and warranties other than (i) representations and warranties as to the title of his Shares and his power, authority and right to enter into the Sale without contravention of law or contract and (ii) such Third Partyrepresentations and warranties concerning the Company as the Majority Shareholders shall make; provided, however, that each any liability for any breach thereof shall be borne by the Optionee on a pro rata basis based upon the consideration in respect of his Shares received by the Optionee and shall not exceed the amount of such Holder consideration received by the Optionee. Further, notwithstanding the foregoing, Optionee shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make execute any purchase agreements, merger agreements, indemnity agreements, escrow agreements or related documents containing terms applicable to the Optionee that are different in connection with any material respect from the Third Party Sale is a representation terms applicable to the Majority Shareholders (after due adjustment for the relative rights and warranty with respect to such Holder’s own ownership preferences of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder as provided in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to Company’s charter). The obligations under this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not 11 shall terminate in violation of applicable federal and state securities or other laws or, if such Holder is not provided accordance with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawSection 14(a).
Appears in 2 contracts
Samples: Non Qualified Stock Option Agreement (Monotype Imaging Holdings Inc.), Incentive Stock Option Agreement (Monotype Imaging Holdings Inc.)
Drag Along Right. Notwithstanding any other provision hereof(a) Following compliance with the procedures of Section 2.3, if any Holder has not exercised its Tag-Along Right with respect in the event one or more Stockholders holding more than 50% (or, to the maximum number extent that at such time the Investor Holders own less than 60% of Holder’s Shares the outstanding shares of common stock, Investor Holders holding more than 40%) of the outstanding shares of Common Stock in the aggregate (the "Transferor") propose to Transfer for which such Holder cash or marketable equity securities traded or quoted on a national exchange or quotation system all of the shares of Common Stock held by the Transferor to a third party that (i) is permitted not an Affiliate of the Transferor and (pursuant to Section 2(b)(ii)(Bii) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale event the Transfer (in each whole or in part) is in exchange for marketable equity securities, the issuer of such entity’s sole discretionsecurities has an equity market capitalization of at least $1,000,000,000 (a "Transferee"), such Holder shall sell Transferor or such Transferee, to the respective Third Party extent authorized by such Transferor, may require the number of whole Holder’s Shares (rounded upwards Other Stockholders and any Investor Holders to participate in such Transfer and sell or downwards, as applicable), whether or not transfer all the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on Stockholders in the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price manner and on the same terms and conditions (or on terms and conditions, in the case of Class B Common Stock, appropriately adjusted to account for the applicable rights upon liquidation) as such Selling Fortress Entity has agreed Transferor (the "Drag-Along Right").
(b) No later than twenty (20) days prior to with the consummation of the Transfer, the Transferor shall deliver a written notice to the Other Stockholders (and any Investor Holder) specifying the names and address of the proposed parties to such Third Party; providedTransfer and the terms and conditions thereof. In the event such written notice is given, howeverany warrants and options held by each Stockholder which are then presently exercisable (or become exercisable as a result of the transaction that is the subject of the notice), that shall be exercised by the Stockholders for Common Stock, which Common Stock shall also be subject to the Drag-Along Right, and such options and warrants to the extent not then exercisable (or to the extent such options and warrants would not become exercisable as a result of such transaction) shall automatically be cancelled. The closing of the Transfer shall be held at such time and place as the Transferor or the Transferee shall reasonably specify. Prior to or at such closing, each Stockholder shall deliver stock certificates representing its Shares, duly endorsed for transfer, and each such Holder Stockholder shall not be permitted to sell any unvested Holder’s represent and warrant that (i) such Stockholder is the record and beneficial owner of such Shares and (provided that the Company may, in its sole discretion, accelerate the vesting ii) such Shares are being transferred free and clear of any unvested Holder’s Sharesliens, charges, claims or encumbrances (other than restrictions imposed pursuant to applicable Federal and state securities laws and this Agreement); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts . Each Stockholder agrees to provide that (A) the only representation take all actions necessary and warranty which such Holder shall be required to make desirable in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership consummation of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear Transfer, including without limitation, the waiver of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect all appraisal rights available to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded Stockholder under applicable law, and shall make such additional representations and warranties as shall be customary in transactions of a similar nature.
Appears in 2 contracts
Samples: Stockholders' Agreement (Exco Resources Inc), Stock Purchase Agreement (Miller Douglas H)
Drag Along Right. Notwithstanding At any other provision hereof, if any Holder has not exercised its Tag-Along Right time (i) prior to the fifth (5th) anniversary of the date hereof with regard to a Transfer of Units with respect to the maximum number of Holder’s Shares for which such Holder is permitted (a Member may not unreasonably withhold its Consent pursuant to Section 2(b)(ii)(B6.01(a), or (ii) aboveafter the fifth (5th) anniversary with regard to exercise such Tagany Transfer of Units, if XXXX receives a bona fide offer from an independent third party to Transfer all, but not less than all, of its Units to a purchaser which is not an Affiliate of XXXX in a single, arm’s length transaction, or in a series of related arm’s length transactions, through the sale of Units, or a merger, consolidation or other similar corporate reorganization of the Company (the “Drag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion”), such Holder then XXXX shall sell provide written notice to NHI and the respective Third Party the number of whole Holder’s Shares other Members at least thirty (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal 30) days prior to the product of (x) the total number of Holder’s Shares held by such Holder on the date of such proposed Transfer (the “Drag-Along Notice”), which shall specify the identity of the prospective purchaser and the material terms and conditions of such proposed Transfer and the amount and type of consideration to be paid in respect thereof. The Drag-Along Notice (shall also constitute the Proposed Sale Notice pursuant to Section 6.06(b). If NHI does not provide a Purchase Notice to XXXX as defined below) and (y) provided in Section 6.06(c), then XXXX may at its option, require all of the Third Party Sale Percentageother Members of the Company, at the same price and including NHI, to Transfer all, but not less than all, of their respective Units to such purchaser on the same terms and conditions as such Selling Fortress Entity has agreed offered to with such Third PartyXXXX; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the gross proceeds of the Drag-Along Sale, less the aggregate reasonable and customary expenses of the Company mayincurred in connection therewith, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required shared by the Members in the same manner as if all of the assets of the Company were sold for such sale price and the proceeds of such sale were distributed to make the Members in connection accordance with Section 4.02 (and the Third Party Sale is a representation and warranty same power of attorney contained in Section 6.06(e) shall apply with respect to such Holder’s own ownership any Drag-Along Sale).
(a) The closing of the Holder’s Shares Drag-Along Sale shall take place at such time and place as XXXX shall specify in the Drag-Along Notice. At the closing of the Drag-Along Sale, each Member shall deliver such customary transfer documents as XXXX may reasonably request to Transfer the Units to be sold by it such Member, against delivery of the applicable consideration.
(b) By execution of this Agreement, each Member hereby agrees, subject to NHI’s rights pursuant to Section 6.06 to Consent to and to participate in a Drag-Along Sale in a timely manner. If any Member shall default in its ability obligation to convey title thereto free and clear of lienssell its Units in a Drag-Along Sale, encumbrances and adverse claims and (B) the liability then XXXX may seek specific performance of such Holder with respect Member’s obligations under this Section 6.07 or pursue any other remedies at law or in equity. In addition, to the extent any representation and warranty made Member fails to take any required action in connection with the Third Party Sale is the several liability this Section 6.07, each Member hereby grants XXXX power of attorney to take such Holder (and not joint with any other person) and that action on such liability is limited to the amount Member’s behalf. The power of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale attorney granted pursuant to this Section 2(b)(iii6.07(c) unless such Holder is provided a special power of attorney coupled with an opinion of counsel interest and is irrevocable.
(c) Notwithstanding anything to the effect that the Third Party Sale is not in violation of applicable federal contrary contained herein, as a condition and state securities or other laws or, if such Holder is not provided with an opinion with respect prior to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered closing of a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transactionSale, each Holder agrees Member and its respective Affiliates (unless waived by such Member) shall be released from any personal liability with respect to vote its Holder’s Shares in favor of such merger and not all Loans (including, without limitation, any liability associated with any guaranty or indemnity relating to exercise any rights of appraisal or dissent afforded under applicable lawa Loan).
Appears in 2 contracts
Samples: Limited Liability Company Agreement (Griffin-American Healthcare REIT III, Inc.), Limited Liability Company Agreement (NorthStar Healthcare Income, Inc.)
Drag Along Right. Notwithstanding any other provision hereof(a) In the event that AIL proposes to Transfer to one or more third parties AIL Shares that represent, in the aggregate, fifty percent (50%) or more of the voting power of the Ordinary Shares of the Company then outstanding, if any Holder has not exercised the price per share of the AIL Shares to be Transferred represents a price per Youku Share (on a “look-through” basis) that is no less than the Minimum Drag-Along Price, AIL shall have the right (a “Drag-Along Right”) to require Yunfeng to Transfer or cause to be Transferred to such third part(ies) a percentage of the YF Shares then beneficially owned by Yunfeng and/or its TagAffiliates equal to the percentage of the AIL Shares to be Transferred, on the same material terms and conditions and for the same price per share as the AIL Shares being Transferred to such third part(ies) (a transaction described above, a “Drag-Along Sale”).
(b) In order to exercise a Drag-Along Right, AIL shall notify Yunfeng by delivering a written notice of the proposed Transfer (a “Drag-Along Notice”) to Yunfeng, which shall specify that AIL is exercising its Drag-Along Right with respect to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to this Section 2(b)(ii)(B) above) to exercise such Tag5.2, and shall set forth a reasonable description of the material terms and conditions of the proposed Drag-Along Right in respect of a Third Party Sale, then, upon including (i) the demand name of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretionthe proposed transferee(s), such Holder shall sell to the respective Third Party (ii) the number of whole Holder’s AIL Shares proposed to be Transferred and (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (xiii) the total number of Holder’s Shares held price per share.
(c) Yunfeng hereby agrees to take all actions reasonably requested by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make AIL in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership consummation of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If Sale, including: (i) executing a written consent and voting the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s YF Shares in favor of such merger Sale, if applicable, (ii) waiving any dissenters’, appraisal and not similar rights, if any, with respect thereto, (iii) consenting to, and raising no objections against, the Drag-Along Sale or the process pursuant to exercise which it was arranged, (iv) executing any rights of appraisal or dissent afforded under applicable lawdocuments that AIL may reasonably require in connection therewith and (v) causing the YF Shares subject to such Drag-Along Sale to be sold to such proposed transferee(s) in such Drag-Along Sale.
Appears in 2 contracts
Samples: Share Purchase and Shareholders Agreement (Alibaba Group Holding LTD), Share Purchase and Shareholders Agreement (Ali YK Investment Holding LTD)
Drag Along Right. Notwithstanding (a) After the Closing Date, if Xxxxxxxxx Capital and Ruipeng Parties agree to a transaction with a third party (excluding Xxxxxxxxx Capital’s and Ruipeng Parties’ related parties), including but not limited to any merger, acquisition, reorganization, share transfer and issuance or for New Ruipeng Group, or any transaction that may make New Ruipeng Group’s all or substantially whole assets to be sold (such transaction is hereinafter referred to as “Sale of Company”), and the evaluated amount of New Ruipeng Group upon Sale of Company is not less than the evaluated amount of New Ruipeng Group at the time immediately after completion of this Transaction, Xxxxxxxxx Capital and Ruipeng Parties shall have the right to send a written notice to each other shareholder to require them to immediately sign and take all the documents and action necessary for completing such transaction, including but not limited to casting affirmative votes at the Shareholders’ Meeting, and procuring the directors nominated by them to cast affirmative votes at the Board of Directors meeting, held for approving such transaction and, where applicable, selling the New Ruipeng Group’s shares held by them.
(b) If any other provision hereof, if any Holder has shareholders do not exercised its Tag-Along Right with respect agree to the maximum number transaction of HolderSale of Company, or are not willing to sell the New Ruipeng Group’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion)shares held by them, such Holder shareholders shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentagebuy, at one time, all the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, shares in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares New Ruipeng Group planned to be sold by it Xxxxxxxxx Capital and its ability Ruipeng’s Management Shareholders, at the price per share of the shares planned to convey title thereto free be sold to a third party by Xxxxxxxxx Capital and clear Ruipeng’s Management Shareholders and on other terms and conditions, or at the income from each share which would be obtained by Xxxxxxxxx Capital and Ruipeng’s Management Shareholders if the transaction of liensSale of Company would have been approved. Where such shareholders do not purchase the shares, encumbrances such shareholders shall agree to and adverse claims and (B) procure the liability transaction of such Holder Sale of Company and/or sell the New Ruipeng Group’s shares held by them, in accordance with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawArticle 8.6.
Appears in 2 contracts
Samples: Blanket Merger Agreement (New Ruipeng Pet Group Inc.), Merger Agreement (New Ruipeng Pet Group Inc.)
Drag Along Right. Notwithstanding any other provision hereof, if any Holder 5.1 If the Company has not exercised consummated a Qualified IPO and also fails to perform its Tag-Along Right with respect redemption obligations in Section 6 hereof by March 31, 2022, at any time after March 31, 2022, should there be an offer from a third party to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of effect a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice along Sale (as defined below) of the Company, which has been approved by (i) the holder(s) of at least a majority of the outstanding Preferred Shares, on an as-converted basis and voting together as a single class, (ii) the holder(s) of at least a majority of the outstanding Ordinary Shares (excluding Ordinary Shares issued upon the Conversion of the Preferred Shares), voting together as a single class, and (yiii) a simple majority of the Third Party Sale PercentageBoard including the Series A Director and Series Seed-B Director, at all the same price holders of the Preferred Shares and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Ordinary Shares (provided that of the Company mayand their respective assigns shall (i) vote all the Preferred Shares and the Ordinary Shares directly or indirectly held by them in favor of, or give their written consent with respect to, such proposed Drag-along Sale and in its sole discretion, accelerate the vesting opposition of any unvested Holder’s Shares)proposal that could reasonably be expected to delay or impair the consummation of any such proposed Drag-along Sale; provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts (ii) refrain from exercising any dissenters’ rights or rights of appraisal under applicable law at any time with respect to provide that (A) the only representation and warranty which such Holder shall be required to make or in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership proposed Drag-along Sale; (iii) transfer all of the Holder’s Preferred Shares and the Ordinary Shares directly or indirectly held by them to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims the purchaser in the proposed Drag-along Sale; and (Biv) take all actions reasonably necessary to consummate the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a proposed Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If along Sale, including without limitation amending the Third Party Sale is in then existing memorandum and articles of association of the form Company.
5.2 For purpose of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable law.this Agreement,
Appears in 2 contracts
Samples: Shareholder Agreement (Pintec Technology Holdings LTD), Shareholder Agreement (Pintec Technology Holdings LTD)
Drag Along Right. Notwithstanding 6.1 If at any other provision time after the date hereof and prior to a Qualified IPO (which shall be no later than the third anniversary of date hereof), if any Holder has not exercised its Tagthere shall be an offer from a third party to effect a Trade Sale, provided that in such offer the valuation of the Group Companies shall be no less than two hundred percent (200%) of the post-money valuation of the Company immediately following the last issuance of the Series E Preferred Shares pursuant to the Share Purchase Agreements, the Majority Preferred Holders and the Ordinary Majority (the “Drag-Along Right with respect Requestors”) have approved the terms and conditions of such Trade Sale and have committed to the maximum number of Holder’s Shares for which participate in such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Trade Sale, then, upon all the demand Shareholders of any Selling Fortress Entity participating in the Company and their respective assigns shall:
(a) if such Third Party Trade Sale requires shareholder approval, with respect to all Shares that such Shareholder owns or over which such Shareholder otherwise exercises voting power, to vote (in each such entity’s sole discretion)person, such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards by proxy or downwardsby action by written consent, as applicable)) all Shares in favor of, whether or not the restrictions on Transfer of Common Stock have lapsedand adopt, equal such Trade Sale (together with any related amendment to the product memorandum and articles of association required in order to implement such Trade Sale) and to vote in opposition to any and all other proposals that could reasonably be expected to delay or impair the ability of the Company to consummate such Trade Sale;
(xb) if such Trade Sale involves a sale of Shares of the total number Company, to sell the same proportion of Holder’s Shares of the Company held by such Holder on the date of Shareholder as is being sold by the Drag-Along Notice (as defined below) and (y) Requestors to the Third Party Sale Percentagepersons to whom the Drag-Along Requestors propose to sell their Shares, at the same price and on the same terms and conditions as the Drag-Along Requestors;
(c) to execute and deliver all related documentation and take such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder other action in support of the Trade Sale as shall not reasonably be permitted to sell any unvested Holder’s Shares (provided that requested by the Company mayor the Drag-Along Requestors in order to carry out the terms and provision of this Section 6.1, including without limitation executing and delivering instruments of conveyance and transfer, and any purchase agreement, merger agreement, indemnity agreement, escrow agreement, consent, waiver, governmental filing, share certificates duly endorsed for transfer (free and clear of impermissible liens, claims and encumbrances) and any similar or related documents;
(d) not to deposit, and to cause their Affiliates or permitted assignees not to deposit, except as provided in its sole discretionthis Agreement, accelerate any Shares of the vesting Company owned by such party or Affiliates or permitted assignees in a voting trust or subject any Shares to any arrangement or agreement with respect to the voting of any unvested Holder’s such Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts unless specifically requested to provide that (A) do so by the only representation and warranty which such Holder shall be required to make acquiror in connection with the Third Party Sale is a representation and warranty Trade Sale; and
(e) to refrain from exercising any dissenters’ rights or rights of appraisal under applicable law at any time with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Trade Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable law.
Appears in 2 contracts
Samples: Shareholder Agreement (ForU Worldwide Inc.), Shareholder Agreement (ForU Worldwide Inc.)
Drag Along Right. Notwithstanding any other provision hereof(i) If (a) a Selling Party has complied with Sections 2.01(d), if any Holder (b) the Non-Selling Party has elected not exercised to acquire the Subject Interest or has failed to make an election before the expiration of the ROFR Offer Period (c) such Selling Party is proceeding with the Transfer of the Subject Interest pursuant to Section 2.01(d)(iii) and (d) the Subject Interest which the Selling Party proposes to Transfer represents more than fifty percent (50%) of the then outstanding Common Shares, then the Selling Party may require the Non-Selling Party to sell in such Transfer (a “Drag-Along Transfer”), on substantially the same terms and conditions set forth in the Sale Notice, the same proportion of its Common Shares as is proposed to be sold by the Selling Party in lieu of the Tag-Along Right with respect to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B2.01(e).
(ii) aboveThe Selling Party shall give the Non-Selling Party written notice at least twenty five (25) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell days prior to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the anticipated closing date of the Drag-Along Notice Transfer (as defined below) and (y) a “Drag-Along Notice”). Upon delivery of the Third Drag-Along Notice, the Non-Selling Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make sell to the Transferee the same proportion of its Common Shares as the Selling Party actually sells pursuant to the Drag-Along Transfer.
(iii) The Selling Party may elect in connection with its discretion to terminate or otherwise not to sell any of its Common Shares in the Third Drag-Along Transfer (and shall not otherwise be deemed to owe any duty or responsibility to the Non-Selling Party Sale is a representation and warranty with to proceed), in which case, the obligations under this Section 2.01(f) in respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect Drag-Along Transfer shall cease.
(iv) If for any reason the Selling Party elects to terminate or otherwise not to sell any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder its Common Shares in the Third Party Sale; provided furtherDrag-Along Transfer, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless or such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered Transfer would no longer qualify as a Drag-Along Notice Transfer, or such Drag-Along Transfer should fail to such Holder shall indemnify such Holder for close, the Selling Party must comply with the provisions set forth in Sections 2.01(d) and 2.01(e), to the extent applicable, prior to making any such violation. If the Third Party Sale is in the form subsequent Transfer of a merger transaction, each Holder agrees to vote all or any portion of its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawCommon Shares.
Appears in 2 contracts
Samples: Transaction Agreement (Energy Transfer Equity, L.P.), Transaction Agreement (Energy Transfer Partners, L.P.)
Drag Along Right. Notwithstanding If the Investors holding at least eighty seven percent (87%) of the Preferred Stock, voting together as a single class on an as-converted basis (the “Requisite Investors”), approve a sale of the Company or all or substantially all of the Company’s assets, whether by means of a merger, consolidation or sale of stock or assets, or otherwise (an “Approved Sale”), the Key Holders and the Investors shall each consent to, vote for, and raise no objections to the Approved Sale, and (i) if the Approved Sale is structured as a merger or consolidation of the Company, or a sale of substantially all of the Company’s assets, the Key Holders and Investors shall each waive any dissenters rights, appraisal rights or similar rights in connection with such merger, consolidation or asset sale, or (ii) if the Approved Sale is structured as a sale of the stock of the Company, the Key Holders and Investors shall each agree to sell their Key Holder Shares and Investor Shares on the terms and conditions approved by the Requisite Investors, provided such terms do not provide that the Key Holder or Investor would receive less than the amount that would be distributed to the Key Holder or Investor in the event the proceeds of the Approved Sale were distributed in accordance with the Company’s Certificate of Incorporation, as amended (the “Charter”). The Key Holders and the Investors shall each take all necessary and desirable actions approved by the Requisite Investors in connection with the consummation of the Approved Sale, including the execution of such agreements and such instruments and other provision hereofactions reasonably necessary to (x) provide the representations, if any Holder has not exercised its Tagwarranties, indemnities, covenants, conditions, non-Along Right compete agreements (with respect to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretionKey Holders), escrow agreements and other provisions and agreements relating to such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) Approved Sale and (y) effectuate the Third Party allocation and distribution of the aggregate consideration upon the Approved Sale. Notwithstanding anything to the contrary herein, no Key Holder or Investor shall be required to provide (a) representations and warranties in connection with an Approved Sale Percentageother than those pertaining to authorization, at ownership, due execution, binding obligations and, if a sale of stock, the same price absence of liens on such stock or (b) indemnification in excess of its pro rata portion of the proceeds received by the Key Holders and on the same terms and conditions as Investors in such Selling Fortress Entity has agreed to with such Third PartyApproved Sale; provided, however, that each in no event shall such Key Holder shall not or Investor, as applicable, be permitted to sell liable for any unvested Holder’s Shares (provided that the Company may, amount in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership excess of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Key Holder or Investor, as applicable, in the Third Party such Approved Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable law.
Appears in 2 contracts
Samples: Series C Preferred Stock Purchase Agreement, Series C Preferred Stock Purchase Agreement (Fulcrum Bioenergy Inc)
Drag Along Right. Notwithstanding If SGS intends to accept a third party offer, then SGS shall deliver to each Minority Shareholder a notice of such third party offer (a “Disposition Notice”), specifying the purchase price and other terms and conditions of such third party offer and SGS’s reasonable determination that the third party offer is more favorable to SGS than any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect to offer of the maximum number of Holder’s Shares for which such Holder is permitted (Minority Shareholders pursuant to Section 2(b)(ii)(B6.2. Unless waived by all of the Minority Shareholders, SGS’s determination shall be accompanied by a list of the terms and factors that SGS compared and its analysis in making its determination that the third party offer is more favorable than the offer of the Minority Shareholders. If the terms of such third party sale are more favorable to SGS than the offer by the Minority Shareholders, then the Minority Shareholders shall have the right to match the third party offer, notice of which (the “Matching Best Offer Notice”) abovemust be given to SGS within ten (10) days after receipt of the Disposition Notice. If the Minority Shareholders do not match such third party offer or if the Minority Shareholders did not make an offer to exercise such Tag-Along Right in respect SGS pursuant to Section 6.2, SGS will have the right, at its option (exercisable by written notice given to each Minority Shareholder within twenty (20) days of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretionDisposition Notice), such Holder shall sell to require the respective Third Party Minority Shareholders (the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the “Drag-Along Notice (as defined belowRight”) and (y) to sell all of their Shares but not less than all of their Shares, to the Third Party Sale Percentagethird party, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it SGS, and the Minority Shareholders shall deliver to counsel for SGS (to be held in escrow) at or before closing of the contemplated sale the certificates representing all Shares owned by them. If, within 120 days after the Disposition Notice, SGS has not completed the sale of all of its ability Shares (for a reason other than the failure of any Minority Shareholder to convey title thereto free and clear of liensdeliver certificates for his or her Shares) in accordance herewith, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited SGS shall return to the amount of proceeds actually received Minority Shareholders the Shares delivered by such Holder shareholder for sale pursuant hereto, and all the restrictions on sale or other disposition contained in this Agreement shall again be in effect. In the Third Party Sale; provided furtherevent SGS does not exercise its Drag Along Right during the 20-day period, the Drag Along Right shall be deemed to be waived and SGS shall be permitted to sell its Shares to a third party that is reasonably acceptable to the Minority Shareholders holding at least a Holder majority of the Voting Common Stock held by the Minority Shareholders, such acceptance not to be unreasonably withheld. The Minority Shareholders shall not be obligated to participate in any Third Party Sale notify SGS whether the third party is reasonably acceptable pursuant to this Section 2(b)(iii6.4 within thirty (30) unless such Holder is provided an opinion days of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawDisposition Notice.
Appears in 1 contract
Samples: Shareholders’ Agreement (Southern Graphic Systems, Inc.)
Drag Along Right. Notwithstanding any other provision hereofSubject to the AAG ROFR:
(a) LMP Member may initiate a Sale Transaction with a Third Party in accordance with this Section 7.11(a) by delivery of written notice to the Company and, if any Holder has not exercised its Tagupon delivery of such notice, shall have the rights described in this Section 7.11 (such right a “Drag-Along Right Right” and such Sale Transaction, a “Drag-Along Transaction”).
(b) In connection with respect to the maximum number of Holder’s Shares for which such Holder is permitted (any Drag-Along Transaction initiated pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion7.11(a), such Holder shall sell and subject to the respective Third Party terms and conditions set forth in this Section 7.11, AAG Member hereby does (and shall promptly, if required by the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not LMP Member) consent in writing to and raise no objections against the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date consummation of the Drag-Along Notice Transaction, and if the Drag-Along Transaction is structured as (as defined belowi) a consolidation, merger or other business combination, or a sale or other disposition of all or substantially all of the assets of the Company and/or its Subsidiaries, each holder of Membership Interests entitled to vote thereon shall vote in favor of the Drag-Along Transaction and shall waive any appraisal rights or similar rights in connection with such consolidation, merger, other business combination or asset sale or (ii) a sale of all of its Membership Interests, AAG Member hereby agrees (and, if required by the LMP Member, shall promptly agree in writing) to sell all of its Membership Interests that are the subject of the Drag- Along Transaction, on the terms and conditions of such Drag-Along Transaction. AAG member shall promptly take all necessary and desirable actions in connection with the consummation of the Drag-Along Transaction reasonably requested by the LMP Member, including the execution of such agreements and such other instruments and other actions reasonably necessary to (x) provide customary representations, warranties, indemnities, and escrow or holdback arrangements relating to such Drag-Along Transaction, in each case to the extent that each other holder of Membership Interests is similarly obligated; and (y) effectuate the Third Party Sale Percentageallocation and distribution of the aggregate consideration upon the Drag-Along Transaction as set forth in Section 7.11(c). Subject to the satisfaction or waiver of the AAG ROFR, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder holders of Membership Interests shall not be permitted to sell their Membership Interests pursuant to any unvested Holder’s Shares Drag-Along Transaction without complying with any other provisions of this Article VII. AAG HOLDING CO1, LLC Limited Liability Company Operating Agreement
(provided c) The obligations of the holders of Membership Interests pursuant to this Section 7.11 are subject to the following terms and conditions:
(i) upon the consummation of the Drag-Along Transaction, each holder of Membership Interests shall receive the same proportion of the aggregate consideration from such Drag-Along Transaction that such holder would have received if such aggregate consideration had been distributed by the Company mayin complete liquidation pursuant to the rights and preferences set forth in Section 12.1 (i.e., net of debts and liabilities of the Company and its Subsidiaries) as in effect immediately prior to the consummation of such Drag-Along Transaction, and if a holder of Membership Interests receives consideration from such Drag-Along Transaction in a manner other than as contemplated by such rights and preferences or in excess of the amount to which such holder is entitled in accordance with such rights and preferences, then such holder shall take such action as is necessary so that such consideration shall be immediately reallocated among and distributed to the holders of Membership Interests in accordance with such rights and preferences;
(ii) the Company shall bear the reasonable, documented costs incurred in connection with any Drag-Along Transaction (costs incurred by or on behalf of any holder of Membership Interests for its sole benefit will not be considered costs of the Drag-Along Transaction) unless otherwise agreed by the Company (as approved by the Board) and the acquiror, in its sole discretion, accelerate the vesting which case no holder of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder Membership Interests shall be required obligated to make any out-of-pocket expenditure prior to the consummation of the Drag-Along Transaction (excluding modest expenditures for postage, copies, and the like) and no holder of Membership Interests shall be obligated to pay any portion (or, if paid, shall be entitled to be reimbursed by the Company for that portion paid) that is more than its pro rata share (based upon the amount of consideration received by such holder in the Drag-Along Transaction) of reasonable expenses incurred in connection with a consummated Drag- Along Transaction for the benefit of all holders of Membership Interests and are not otherwise paid by the Company or another Person;
(iii) consideration placed in escrow or held back shall be allocated among holders of Membership Interests such that if the applicable Third Party in the Drag-Along Transaction ultimately is entitled to some or all of such escrow or holdback amounts, then the net ultimate proceeds received by such holders shall still comply with the intent of Section 7.11(c)(i) as if the ultimate resolution of such escrow or holdback had been known at the closing of the Drag-Along Transaction; and
(iv) if some or all of the consideration received in connection with the Third Party Sale Drag- Along Transaction is other than cash, then such consideration shall be deemed to have a representation and warranty with respect dollar value equal to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability fair market value of such Holder with respect to any representation and warranty made consideration (as determined, in connection with good faith, by the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party SaleBoard); provided further, that a Holder the AAG Member shall not be obligated required to participate in any Third Party Sale pursuant consent to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice Transaction if the consideration to be received in connection with such Holder shall indemnify such Holder for any such violationDrag- Along Transaction is other than cash. If the Third Party Sale is in the form of a merger transactionAAG HOLDING CO1, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable law.LLC Limited Liability Company Operating Agreement
Appears in 1 contract
Samples: Membership Interest Purchase Agreement (LMP Automotive Holdings, Inc.)
Drag Along Right. Notwithstanding (a) If at any time the Company or WHO (the "Proposing Investor") proposes to transfer in a bona fide arm's length sale all or substantially all of the assets or shares of capital stock of the Company or the Stock and Equity Securities owned by WHO to any Person or Persons who are not Affiliates of the Proposing Investor (the "Proposed Transferee"), the Proposing Investor shall have the right (the "Drag Along Right"), subject to applicable law and compliance with any other provision hereofrestrictions applicable to such transfer, if any Holder has not exercised its Tag-Along Right with respect to the maximum number of Holder’s Shares for which such Holder is permitted (require all Investors to sell, pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion3.03(b), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwardsProposed Transferee, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as applicable to the Proposing Investors except as limited in Section 3.03(b), all (but not less than all) of the shares of such Selling Fortress Entity has agreed Stock and Equity Securities then held by such Investors.
(b) To exercise a Drag Along Right, the Proposing Investor shall give each Investor (each, a "Drag-Along Investor"), at least fifteen (15) days prior to with such Third Party; providedthe proposed transfer to the Proposed Transferee, however, that each such Holder a written notice (the "Drag Along Notice") containing (a) the name and address of the Proposed Transferee and (b) the proposed purchase price and the terms of payment and other material terms and conditions of the Proposed Transferee's offer. Each Drag-Along Investor shall not thereafter be permitted obligated to sell any unvested Holder’s Shares (provided that all of its shares of Stock and Equity Securities to the Company may, Proposed Transferee. Each such Drag Along Investor shall agree to enter into a purchase agreement in its sole discretion, accelerate form and substance approved by the vesting Proposing Investors to the extent such agreement shall contain customary representations from each Drag Along Investor as to ownership of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts the shares to provide that (A) be purchased and the only representation absence of liens thereon and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty customary indemnification provisions solely with respect to such Holder’s own ownership representations from the Drag Along Investor. If the sale is not consummated within a period of one hundred eighty (180) days following the date of the Holder’s Shares Drag Along Notice, then each Drag Along Investor shall no longer be obligated to be sold by it sell such Investor's shares of Stock and its ability Equity Securities pursuant to convey title thereto free and clear such Drag Along Right but shall remain subject to the provisions of liens, encumbrances and adverse claims and (B) the liability of such Holder this Section 3.03 with respect to any representation subsequent proposed transfer described in this Section 3.03. The Drag-Along Investor shall not be required to participate in a proposed transfer pursuant to the exercise of a Drag Along Right unless its liability for breaches of representations and warranty warranties made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability sale thereunder is limited to no more than the amount of proceeds actually total sale price received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to Investor in such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawsale.
Appears in 1 contract
Samples: Investors Agreement (Interliant Inc)
Drag Along Right. Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B4(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii4(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has has
delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable law.
Appears in 1 contract
Samples: Restricted Stock Unit Award and Management Shareholder Agreement (TRAC Intermodal LLC)
Drag Along Right. Notwithstanding any other provision hereof4.1. If the holders of a majority of the Series A Stock (the “Triggering Investors”) shall approve in writing or by meeting, if any Holder has not exercised its Tag-Along Right with respect as evidenced by a writing reflecting such approval, a Sale, then the Company shall provide written notice of such approval (the “Sale Notice”) to the maximum number other Investors and the Common Holders (collectively, the “Other Holders”), which notice shall include reasonable details of Holder’s Shares for which such Holder is permitted (pursuant the Sale, including the proposed time and place of the closing and the consideration to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect be received by the Triggering Investors and the Other Holders. Upon the expiration of a Third Party Saleten (10) day period after the Other Holders receive the Sale Notice, theneach of the Other Holders shall be obligated to and shall: (a) sell, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion)transfer and deliver, such Holder shall sell or cause to be sold, transferred and delivered, to the respective Third Party the number proposed purchaser or transferee all of whole Holder’s Shares (rounded upwards his, her or downwards, as applicable), whether or not the restrictions on Transfer its shares of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date capital stock of the Drag-Along Notice (as defined below) and (y) Company in the Third Party Sale Percentage, at the same price and closing thereof on the same terms and conditions as such Selling Fortress Entity has agreed for the same consideration, according to with such Third Party; provided, however, that the different rights and preferences of each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that class and series of capital stock of the Company maypursuant to the Certificate, as that received by the Triggering Investors (and deliver certificates for such shares at the closing, free and clear of all liens and encumbrances); and (b) if stockholder approval of the Sale is required, vote all of his, her or its shares of capital stock of the Company, or provide an irrevocable proxy to vote his, her or its shares, in its sole discretionfavor thereof. Notwithstanding the foregoing, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts no Triggering Investor or Other Holder subject to provide that (A) the only representation and warranty which such Holder this Section 4 shall be required to make any representations or warranties or provide any indemnities in any agreement used to effect a Sale, except relating to ownership of capital stock of the Company by such Triggering Investor or Other Holder, their due execution of such agreement and the enforceability of such agreement as to such Triggering Investor or Other Holder.
4.2. In connection with a Sale, each of the Triggering Investors and Other Holders hereby expressly waives, to the extent permitted under applicable law, the applicability of the provisions for dissenters’ or appraisal rights set forth in Section 262 of the Delaware General Corporation Law, and expressly agrees that it shall not be entitled, under any circumstances in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liensSale, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of such dissenters’ or appraisal or dissent afforded under applicable lawrights.
Appears in 1 contract
Drag Along Right. Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect to (a) In the maximum number event that each of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(Bi) above) to exercise such Tag-Along Right in respect the holders of a Third Party majority of the shares of Common Stock (ii) a Preferred Majority ((i) and (ii) together, the “Selling Holders”) and (iii) the Board approve a Deemed Liquidation Event (as defined in the Restated Certificate) or a Stock Sale, thenthen (x) if such transaction requires stockholder approval, upon the demand of any Selling Fortress Entity participating in such Third Party Sale each Holder and Key Holder hereby agrees to vote (in each such entity’s sole discretion)person, such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards by proxy or downwardsby action by written consent, as applicable)) all shares of capital stock of the Company now or hereafter directly or indirectly owned of record or beneficially by such Holder or Key Holder in favor of, whether and adopt, such Deemed Liquidation Event and to vote in opposition to any and all other proposals that could reasonably be expected to delay or not impair the restrictions on Transfer ability of Common the Company to consummate such Deemed Liquidation Event and (y) if there is a Stock have lapsedSale, equal to sell the product same proportion of (x) shares of capital stock of the total number of Holder’s Shares Company beneficially held by such Holder on or Key Holder as is being sold by the date of Selling Holders to the Drag-Along Notice (as defined below) and (y) person to whom the Third Party Sale PercentageSelling Holders propose to sell their Preferred Stock, at the same price and on the same terms and conditions as the Selling Holders, and in each case to execute and deliver all related documentation and take such Selling Fortress Entity has agreed other action in support of the Deemed Liquidation Event or Stock Sale as shall reasonably be requested by the Company in order to carry out the terms and provision of this Section 3.3, including without limitation executing and delivering instruments of conveyance and transfer, and any purchase agreement, merger agreement, indemnity agreement, escrow agreement, consent, waiver, governmental filing, share certificates duly endorsed for transfer (free and clear of impermissible liens, claims and encumbrances) and any similar or related documents. The proceeds from such Deemed Liquidation or Stock Sale shall be distributed in accordance with such Third Party; providedSection 1.1 of Part B of Article IV of the Restated Certificate.
(b) Notwithstanding the foregoing, however, that each a Holder will not be required to comply with Subsection 3.3(a) above in connection with any proposed Deemed Liquidation Event or Stock Sale of the Company (the “Proposed Sale”) unless:
(i) any representations and warranties to be made by such Holder shall in connection with the Proposed Sale are limited to representations and warranties related to authority, ownership and the ability to convey title to such Capital Stock, including but not be permitted limited to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide representations and warranties that (A) the only representation Holder holds all right, title and warranty which interest in and to the Capital Stock such Holder shall be required purports to make hold, free and clear of all liens and encumbrances, (B) the obligations of the Holder in connection with the Third Party Sale is a representation transaction have been duly authorized, if applicable, (C) the documents to be entered into by the Holder have been duly executed by the Holder and warranty delivered to the acquirer and are enforceable against the Holder in accordance with respect their respective terms and (D) neither the execution and delivery of documents to such Holder’s own ownership be entered into in connection with the transaction, nor the performance of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear obligations thereunder, will cause a breach or violation of liensthe terms of any agreement, encumbrances and adverse claims and law or judgment, order or decree of any court or governmental agency;
(Bii) the liability Holder shall not be liable for the inaccuracy of such Holder with respect to any representation and or warranty made by any other person in connection with the Third Party Sale is Proposed Sale, other than the several Company (except to the extent that funds may be paid out of an escrow established to cover breach of representations, warranties and covenants of the Company as well as breach by any stockholder of any identical representations, warranties and covenants provided by all stockholders);
(iii) the liability for indemnification, if any, of such Holder (in the Proposed Sale and for the inaccuracy of any representations and warranties made by the Company or its stockholders in connection with such Proposed Sale, is several and not joint with any other person) person (except to the extent that funds may be paid out of an escrow established to cover breach of representations, warranties and that covenants of the Company as well as breach by any stockholder of any identical representations, warranties and covenants provided by all stockholders), and is pro rata in proportion to, and does not exceed, other than in the case of fraud or willful misconduct by such liability is limited to holder, the amount of proceeds actually received by consideration paid to such Holder in the Third Party connection with such Proposed Sale; provided furtherand
(iv) upon the consummation of the Proposed Sale, (A) each holder of each class or series of the Company’s stock will receive the same form of consideration for their shares of such class or series as is received by other holders in respect of their shares of such same class or series of stock and (B) unless the holders of at least (i) a majority of the then outstanding shares of Preferred Stock (voting as a single class) elect to receive a lesser amount by written notice given to the Company at least 20 days prior to the effective date of any such Proposed Sale, the aggregate consideration receivable by all holders of the Preferred Stock and Common Stock shall be allocated among the holders of Preferred Stock and Common Stock on the basis of the relative liquidation preferences to which the holders of each respective series of Preferred Stock and the holders of Common Stock are entitled in a Deemed Liquidation Event (assuming for this purpose that the Proposed Sale is a Deemed Liquidation Event) in accordance with the Restated Certificate in effect immediately prior to the Proposed Sale. Notwithstanding any provision herein to the contrary, no Holder shall not be obligated required to participate enter into non-competition, non-solicitation or no-hire restrictive covenant provision in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided connection with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawProposed Sale.
Appears in 1 contract
Drag Along Right. Notwithstanding (a) Subject to Section 5.2(b), if the Majority Onex Investors approve a Sale of the Company (the "APPROVED SALE"), the Equityholders will consent to and raise no objections to the Approved Sale and (i) if the Approved Sale is structured as a sale of Units, the Equityholders will sell all of their Units and rights to acquire Units on the terms and conditions approved by the Majority Onex Investors, (ii) if the Approved Sale is structured as a merger, consolidation or other reorganization, the Equityholders will vote in favor thereof and will not exercise any dissenters' rights of appraisal they may have under Delaware law, and (iii) if the Approved Sale is structured as a sale of all or substantially all of the Company's consolidated assets, the Equityholders will vote in favor thereof. The Equityholders will use their best efforts to cooperate in the Approved Sale and will take all necessary and desirable actions in connection with the consummation of the Approved Sale as are reasonably requested by the Majority Onex Investors, including, but not limited to, entry into agreements and provision of representations, warranties and indemnification, provided, that no Equityholder shall be required to enter into substantively different agreements or provide substantively different representations and warranties or indemnification than any other provision hereof, if any Holder has not exercised its Tag-Along Right Equityholder and each Equityholder's obligations thereunder shall be several and limited to the proceeds received by such Equityholder in connection with such Approved Sale.
(b) The obligations of the Equityholders with respect to the maximum Approved Sale are subject to the satisfaction of the following conditions: (i) upon the consummation of the Approved Sale, all of the Equityholders will receive the same form and per Unit amount of consideration for their Units as all other Equityholders, or if any Equityholders are given an option as to the form and amount of consideration to be received, all Equityholders must be given the same option (except that the Approved Sale may provide for payment in securities to all Equityholders that are accredited investors within the meaning of Regulation D under the Securities Act and in cash to Equityholders that are not accredited investors or may provide Equityholders that are accredited investors with the option to receive securities or cash while Equityholders that are not accredited investors receive cash); and (ii) if the Approved Sale includes a sale to a Person that is an Onex Investor or an Affiliate of an Onex Investor, the holders of a majority of the Units held by the Other Investors may request that an appraisal of the fair market value of the securities to be sold and/or received (based on the fair market value of all of the Company's outstanding equity interests, without regard to any control premium or liquidity or minority discount) by the Other Investors in connection with such Approved Sale be made by an investment banking firm of national recognition mutually agreeable to such parties, and it shall be a condition to the consummation of such Approved Sale to an Onex Investor or an Affiliate of an Onex Investor that such Person pay as consideration to the Other Investors the fair market value as determined pursuant to such appraisal (if such appraisal results in a valuation greater than the valuation of the consideration proposed to be delivered in connection with such Approved Sale, the Company shall pay the costs of such appraisal, otherwise the requesting Equityholders shall pay such costs).
(c) If the proposed Approved Sale involves the receipt by Equityholders of securities for which Section 4(2) of the Securities Act of 1933 or Rule 506 (or any similar rule then in effect) promulgated by the Securities and Exchange Commission may be available with respect to such negotiation or transaction (including a merger, consolidation or other reorganization), the Equityholders will, at the request of the Majority Onex Investors, and to the extent required to comply with Regulation D, appoint a purchaser representative (as such term is defined in Rule 501) reasonably acceptable to the Majority Onex Investor. If any Equityholder appoints the purchaser representative designated by the Majority Onex Investors, the Company will pay the fees of such purchaser representative, but if any Equityholder declines to appoint the purchaser representative designated by the Majority Onex Investors, such holder will appoint another purchaser representative (reasonably acceptable to the Majority Onex Investors), and such holder will be responsible for the fees of the purchaser representative so appointed.
(d) If in connection with an Approved Sale, an Onex Investor (the "ROLLOVER INVESTOR") intends to invest in securities (the "SUCCESSOR SECURITIES") of the acquiring, successor or post-acquisition entity pursuant to an agreement or understanding reached in connection with the Approved Sale (whether through a direct purchase, rollover or otherwise, the "ROLLOVER INVESTMENT"), the Rollover Investor shall deliver written notice (the "ROLLOVER NOTICE") to each of the Other Investors no later than 15 days prior to the consummation of such Rollover Investment, describing in reasonable detail the number and type of Successor Securities subject to such proposed Rollover Investment, the price per security and the other terms and conditions of such Rollover Investment. Each Other Investor may elect to participate in such Rollover Investment by delivering written notice to the Rollover Investor within ten days after the delivery of the Rollover Notice (each such electing Other Investor, a "ROLLOVER EQUITYHOLDER"). If the Rollover Investor actually makes the Rollover Investment in Successor Securities, each Rollover Equityholder shall be entitled to invest in a number of Holder’s Shares for which Successor Securities equal to such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect Rollover Equityholder's Rollover Percentage of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell Successor Securities subject to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale PercentageRollover Investment, at the same price per security and on the same terms and conditions terms, as described in the Rollover Notice. A Rollover Equityholder's "ROLLOVER PERCENTAGE" is the quotient obtained by dividing the number of shares of Units owned by such Selling Fortress Entity has agreed Rollover Equityholder by the sum of the aggregate number of Units owned by the Equityholders (including the Onex Investors). The Rollover Investor shall effect the participation of the Rollover Equityholders in the Proposed Rollover Investment by either (i) obtaining the agreement of the prospective issuer of the Successor Securities to with such Third Party; providedpermit the Rollover Equityholders to directly invest in Successor Securities or (ii) by requiring each Rollover Equityholders to make his/her/its investment through an investment vehicle controlled by an Onex Investor or an Affiliate of an Onex Investor. Notwithstanding the foregoing, however, that each such Holder a Rollover Equityholder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated entitled to participate in any Third Party Sale pursuant to this Section 2(b)(iiia Rollover Investment (a) unless if such Holder is provided an opinion of counsel to the effect that the Third Party Sale Rollover Equityholder is not in violation an accredited investor within the meaning of applicable federal and state securities Regulation D under the Securities Act or other laws or(b) if participation by such Rollover Equityholder would make unavailable any exemption from registration under the Securities Act or the Investment Company Act of 1940, if such Holder is not provided with an opinion with respect to as amended, which has been relied on by the matters contemplated by this provisoacquiring, each Selling Fortress Entity who has delivered a Dragsuccessor or post-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawacquisition entity.
Appears in 1 contract
Samples: Investor Equityholders Agreement (Emergency Medical Services CORP)
Drag Along Right. Notwithstanding (i) In connection with a proposed disposition of all of the MH Members’ Membership Interests to a Third-Party Acquirer in accordance with the terms of this Agreement, MH may deliver at any time within the Sale Period a written notice (a “Drag-Along Notice”) electing (the “Drag-Along Right”) to require a Transfer of all Membership Interests, including those of the CME Group Members and any other provision hereofMembers (a “Drag-Along Sale”) (it being understood that a Drag-Along Sale may be effected by means of a sale of all Membership Interests, including those of the CME Group Members and any other Members, a merger, consolidation or sale of all or substantially all of the assets of the Company or other business combination involving the Company) on the terms and conditions specified in the Drag-Along Notice, including, if any Holder has not exercised its Tagthe consideration for such Transfer includes Illiquid Non-Cash Consideration, a description thereof, including the fair market value thereof determined in the manner provided in clause (2)(A) of the second-to-last sentence of Section 9.1(c)(ii) (it being understood that if such fair market value had been determined pursuant to such clause (2)(A) for purposes of determining whether the Threshold Price was met, the amount so determined shall be used for this purpose) (the “Drag-Along Right with respect to Illiquid Non-Cash Consideration Value”). For the maximum number avoidance of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Saledoubt, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number procedures in this Section 9.1(e) shall not apply to transactions of Holder’s Shares held by such Holder the type described on Schedule 9.4(c) and (y) any sale of all or substantially all of the date assets of the Company or any merger or consolidation of the Company must comply with the provisions of this Section 9.1(e).
(ii) If MH elects to exercise its Drag-Along Right, the MH Members may enter into definitive agreements providing for the Drag-Along Sale. Such agreements (A) shall provide that, upon the consummation of the Drag-Along Notice Sale, each of the CME Group Members and the MH Members participating therein will receive a percentage of the consideration paid by the Third-Party Acquirer equal to such Member’s Percentage Interest and no other direct or indirect consideration, benefit, fee or other amount shall be paid by or on behalf of such Third-Party Acquirer to the MH Entities in relation to such Transfer; provided that if the consideration paid by the Third-Party Acquirer to the MH Members participating therein includes Illiquid Non-Cash Consideration, upon the written election of such CME Group Member made within 20 days after the delivery of such Drag-Along Notice, such CME Group Member shall receive, in lieu of any Illiquid Non-Cash Consideration otherwise payable to such CME Group Member, an amount of cash equal to (as defined below1) the Drag-Along Illiquid Non-Cash Consideration Value multiplied by (2) a fraction whose numerator is such CME Group Member’s Percentage Interest and whose denominator is the aggregate Percentage Interest of the MH Members, (B) shall provide that each of the CME Group Members and the MH Members participating therein shall be obligated to join severally on a pro rata basis in any indemnification or other obligations that the participating MH Members agree to provide or undertake in connection with such Drag-Along Sale; provided that (I) the CME Group Members shall not (1) be required to make any representations or warranties in connection with such Transfer other than representations and warranties concerning title to their Membership Interests (or portions thereof) being Transferred free and clear of any encumbrances (other than those set forth in this Agreement), their valid organization, and their authority, power and right to enter into any agreement with respect to and to consummate the Transfer of their Membership Interest (or portions thereof) without contravention of any Law or conflict with their constitutional documents or (2) be responsible or have any indemnification or other obligation for (x) the fraud, gross negligence or willful misconduct of the MH Members or any other Member, (y) any indemnification obligations or liabilities resulting from any breach of any representation or warranty made by the Third Party Sale Percentage, at MH Members or any other Member with respect to matters of the same price type set forth in clause (1) of the proviso to clause (B) above with respect to the MH Members or their Membership Interests (or portions thereof); or (z) any breach of any covenant or agreement required to be performed by the MH Members or any other Member and (II) the maximum amount of all obligations and liabilities for which the CME Group Members shall be held responsible in connection with such Transfer shall not exceed the proceeds received by the CME Group Members in such Transfer and (C) shall otherwise provide for the Transfer of the MH Members’ Membership Interests and the CME Group Members’ Membership Interests to be on the same terms and conditions as to the extent applicable. The CME Group Members and any other Members shall enter into such Selling Fortress Entity has agreed to with documents and take such Third Party; providedactions, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection consistent with the Third Party Sale is a representation and warranty with respect foregoing, as MH may reasonably request to such Holder’s own ownership of implement the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violationforegoing. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable law.63
Appears in 1 contract
Samples: Limited Liability Company Agreement (McGraw-Hill Companies Inc)
Drag Along Right. Notwithstanding any other provision hereof(a) In the event (i) one or more Members holding more than 60% of the Units then outstanding (the “Majority Unit Owners”) propose to Transfer all of their Interests, if any Holder has not exercised its Tagor (ii) the Board of Directors approves a sale of the Company that will be a Final Exit Event and such sale is structured as a sale of all the Interests of the Company (either (i) or (ii), a “Drag-Along Right with respect Sale”), at their sole option, in the case of (i) above, the Majority Unit Owners, and in the case of (ii) above, the Members who are Affiliates of the members of the Board of Directors who voted in favor of the Drag-Along Sale (either such persons, the “Dragging Members”) shall have the right to require all (but not less than all) of the other Members (each, a “Drag-Along Member”) to sell their Interests in such Drag-Along Sale.
(b) The Dragging Members shall provide each Drag-Along Member notice of the terms and conditions of such proposed Transfer (the “Drag-Along Notice”) not later than 15 Business Days prior to the maximum number closing of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tagthe proposed Drag-Along Right Sale. The Drag-Along Notice shall contain a true and complete copy of any and all available documents constituting the agreement to transfer and, to the extent not set forth in respect the accompanying documents, the price offered for the Interests, all information reasonably available to the Dragging Members regarding the acquirer, all other material terms and conditions of the proposed Drag-Along Sale and, in the case of a Third Party proposed Drag-Along Sale in which the consideration payable for the Interests consists in whole or in part of consideration other than cash, such information relating to such other consideration as is reasonably available to the Dragging Members. Each Drag-Along Member shall be required to participate in the Drag-Along Sale on the terms and conditions set forth in the Drag-Along Notice and this Section 6.7. No Member shall have any dissenters’ or appraisal rights in connection with the Drag-Along Sale, thenand each Member hereby releases, upon and will execute such further instrument as the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion)Company reasonably requests to further evidence the waiver of, such Holder shall sell to the respective Third Party the number of whole Holder’s Shares rights.
(rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (xc) the total number of Holder’s Shares held by such Holder on the date Within 10 Business Days following receipt of the Drag-Along Notice (as defined belowthe “Drag-Along Notice Period”), each Drag-Along Member must deliver to such Dragging Members (i) wire transfer instructions for payment of the purchase price for the Interests to be sold in such Drag-Along Sale, and (yii) all other documents required to be executed in connection with such Drag-Along Sale. Each Member makes, constitutes, and appoints the Third Party Sale PercentageManager (or its chief executive officer, in his official corporate capacity) as its true and lawful attorney-in-fact for such person and in its name, place, and stead and for its use and benefit, to sign, execute, certify, acknowledge, swear to, file, and record any instrument that is now or may hereafter be deemed necessary by the Company in its reasonable discretion to carry out fully the provisions and the agreement, obligations, and covenants of such Member in this Section 6.7 in the event that such Member is or becomes a Drag-Along Member pursuant to this Section 6.7. Each Member hereby gives such attorney-in-fact full power and authority to do and perform each and every act or thing whatsoever requisite or advisable to be done in connection with such Member’s obligations and agreements as a Drag-Along Member pursuant to this Section 6.7 as fully as such Member might or could do personally, and hereby ratifies and confirms all that any such attorney-in-fact shall lawfully do or cause to be done by virtue of the power of attorney granted hereby. The power of attorney granted pursuant hereto is a special power of attorney, coupled with an interest, and is irrevocable, and shall survive the bankruptcy, insolvency, dissolution or cessation of existence of the applicable Member.
(d) If, at the same price and end of the 90-day period after the date on which the Dragging Members give the Drag-Along Notice (which 90-day period shall be extended if any of the transactions contemplated by the Drag-Along Sale are subject to regulatory approval until the expiration of five Business Days after all such approvals have been received, but in no event later than 120 days following the delivery of the Drag-Along Notice), the Drag-Along Sale has not been completed on substantially the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; providedset forth in the Drag-Along Notice, however, that each such Holder the Drag-Along Members shall not no longer be permitted obligated to sell their Interests pursuant to such Drag-Along Notice and the Dragging Members shall return to each Drag-Along Member any unvested Holder’s Shares (provided that documents in the Company may, in its sole discretion, accelerate possession of the vesting Dragging Members executed by or on behalf of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make Drag-Along Member in connection with the Third Party Sale is a representation and warranty proposed Drag-Along Sale.
(e) Concurrently with respect to such Holder’s own ownership the consummation of the Holder’s Shares Drag-Along Sale, Dragging Members shall (i) notify the Drag-Along Members thereof, (ii) remit to the Drag-Along Members the total consideration for the Interests of the Drag-Along Members Transferred pursuant thereto, and (iii) promptly after the consummation of the Drag-Along Sale, furnish such other evidence of the completion and the date of completion of such Transfer and the terms thereof as may be sold reasonably requested by it and its ability the Drag-Along Members.
(f) Notwithstanding anything contained in this Section 6.7, there shall be no liability on the part of the Dragging Members to convey title thereto free and clear the Drag-Along Members if the Transfer of liensthe Membership Interests pursuant to this Section 6.7 is not consummated for whatever reason.
(g) Notwithstanding anything contained in this Section 6.7, encumbrances and adverse claims the obligations of the Drag-Along Members to participate in a Drag-Along Sale are subject to the following conditions:
(i) upon consummation of such Drag-Along Sale, (A) all of the Members participating therein will receive the same form of consideration, and (B) the liability aggregate consideration received by the Members will be paid to the Members subject to the allocation provisions set forth in Section 5.4;
(ii) no Drag-Along Member participating therein shall be obligated to pay any expenses incurred in connection with any unconsummated Drag-Along Sale, and each Drag-Along Member shall be obligated to pay only its pro rata share (based on the amount of the purchase price received) of expenses incurred in connection with a consummated Drag-Along Sale to the extent such Holder expenses are incurred for the benefit of all Members and are not otherwise paid by the Company or another person;
(iii) without the written consent of a Drag-Along Member, such Drag-Along Member shall not be obligated with respect to (A) any representation or warranty other than a representation and warranty made in connection with that relates solely to such Drag-Along Member’s title to its Interest, and its authority and capacity to execute and deliver the Third Party Sale is the several liability of such Holder subject purchase and sale agreement, or (B) any indemnity obligation beyond a pro rata portion (based on and not joint with any other person) and that such liability is limited to the amount value of proceeds actually consideration received by such Holder Drag-Along Member in the Third Party Drag-Along Sale) of the indemnity obligations which obligate the Dragging Members and all Drag-Along Members and then, such indemnity obligations shall be several and not joint, or (C) any other continuing obligation on such Drag-Along Member in favor of any other person following the Disposition of such Drag-Along Member’s Interests (other than obligations relating to representations and warranties that relate solely to such Drag-Along Member and not to any other Member or the indemnification obligation provided for in clause (B) above);
(iv) no Drag-Along Member shall be obligated to consummate such Drag-Along Sale contemplated by the Drag-Along Notice with respect to its Interests unless the Dragging Members consummate such Drag-Along Sale with respect to all (but not less than all) of their Interests on the terms and conditions contemplated by the Drag-Along Notice; provided further, that a Holder and
(v) no Drag-Along Member shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale that is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawan Excluded Affiliate Transfer.
Appears in 1 contract
Samples: Limited Liability Company Agreement (Carbon Natural Gas Co)
Drag Along Right. (a) If Members holding an aggregate Percentage Interest of at least 67% and a majority of the Preferred Units and a majority of the Common Units approve a Sale of the Company and deliver written notice to each Member invoking the provisions of this Section 9.7(a) regarding a Sale of the Company (an “Approved Sale”), each Member shall consent to the Approved Sale, and if the Approved Sale is structured as a sale or exchange of Units, each Member shall, if requested by the Members delivering such notice, sell (or otherwise Transfer) that percentage of his, her or its Units, on terms and conditions approved by such majority, as shall equal the percentage of Common and Preferred Units that are to be included in such transaction. Proceeds from such a sale of Units shall be allocated among the participating Members by taking into account the value of the Preference Payment as if such proceeds were distributed as an Additional Distribution under Section 5.1(b), taking into account the provisions of Section 5.1(d) as to in-kind distributions. Each Member shall take all actions reasonably necessary or reasonably desirable (as determined by such majority) in connection with the consummation of the Approved Sale. Without limiting the foregoing, if the Approved Sale is structured as a merger, consolidation, joint venture or similar transaction, each Member shall vote in favor of such transaction and waive any dissenters’ rights, appraisal rights or similar rights in connection with such transaction.
(b) The obligations of a Member pursuant to Section 9.7(a) are subject to the satisfaction of the following conditions:
(i) The consideration payable upon consummation of the Approved Sale to all Members shall be allocated among the Members as an Additional Distribution under Section 5.1(b); and
(ii) if any holders of Common and Preferred Units are given an option as to the form and amount of consideration to be received, all holders of Units will be given the same option.
(c) Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect contained in this Section 9.7 to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Salecontrary, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder there shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder be no liability on the date part of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell Company or any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder Member in the Third Party Sale; provided further, event that a Holder shall not be obligated to participate in any Third Party an Approved Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale 9.7 is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder consummated for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawreason whatsoever.
Appears in 1 contract
Samples: Limited Liability Company Agreement
Drag Along Right. Notwithstanding (a) Within twelve (12) months of the Closing Date, in the event that the holders of fifty-one percent (51%) or greater of Pubco Common Stock (collectively, the “Controlling Shareholders”) desire to sell or otherwise transfer or dispose of any other provision hereofshares of Pubco Common Stock owned by such Controlling Shareholders, if which shares constitute (together with any Holder has not exercised its Tag-Along Right with respect previous sales of Pubco Common Stock by the Controlling Shareholders to the maximum number same third party transferee(s)) more than fifty percent (50%) of Holder’s Shares for which the outstanding shares of common stock or other voting securities of Pubco as of such Holder is permitted (pursuant date, to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretionthird party transferee(s), the Controlling Shareholders may elect to provide notice of such Holder shall sell intended transfer to the respective Third Party Company Shareholders and Xx. Xxx no less than twenty (20) days prior to such intended transfer (the number “Drag Along Notice”).
(b) Within ten (10) days after delivery of whole Holder’s Shares the Drag Along Notice, each of the Company Shareholders and Xx. Xxx shall be obligated to (rounded upwards or downwardsA) sell, as applicable), whether or not transfer and deliver to such third party transferee(s) all of the restrictions on Transfer shares of Pubco Common Stock have lapsed, equal to owned by the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) Company Shareholders and (y) the Third Party Sale Percentage, at the same price and on Xx. Xxx upon the same terms and conditions as are applicable to the Controlling Shareholders, but only to the extent such Selling Fortress Entity has agreed third party transferee(s) desires to with acquire such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that shares of Pubco Common Stock from the Company mayShareholders and Xx. Xxx, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that and (AB) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership if shareholder approval of the Holder’s Shares to be sold transaction is required, vote all shares of Pubco Common Stock owned by it the Company Shareholders and its ability to convey title thereto Xx. Xxx in favor thereof (the “Drag Along Right”).
(c) To close a proposed transfer as described in this Section 4.08, the Controlling Shareholders, the Company Shareholders and Xx. Xxx shall deliver, free and clear of all liens, encumbrances to the third party transferee(s) certificates evidencing Pubco Common stock to be sold thereto, duly endorsed with transfer powers, and adverse claims and (B) shall receive in exchange therefore the liability consideration to be paid or delivered by the third party transferee in respect of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder Pubco Common Stock as described in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Drag Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawNotice.
Appears in 1 contract
Drag Along Right. Notwithstanding any (a) In the event that a TownB Transaction involves (i) the proposed sale or other provision hereofTransfer of all or substantially all of the assets of TownB, if any Holder has or the proposed sale or other Transfer, whether by direct purchase, merger or otherwise, of all or substantially all of the outstanding shares of capital stock of TownB in one or more related transactions to, or (ii) the approval of such a transaction with, a bona fide third party purchaser or acquirer who in the good faith License & Investment Agt 4 judgment of QuinStreet is not exercised its Tag-Along Right with respect a direct competitor of QuinStreet (such Transfer or transaction, a “Company Sale,” and such purchaser or acquirer, the “Proposed Purchaser”), then, to the maximum number extent QuinStreet elects not to exercise its rights of Holder’s Shares for which such Holder is permitted (first refusal pursuant to Section 2(b)(ii)(B3.03 to purchase such shares or assets, TownB or the transferring stockholders, as the case may be (collectively “Transferring Stockholders”) above) shall have the right to exercise such Tag-Along Right in respect require that QuinStreet transfer all of a Third Party Sale, then, upon the demand its shares of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell capital stock of TownB to the respective Third Party the number of whole Holder’s Shares (rounded upwards Proposed Purchaser for, or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date otherwise vote in favor of the Drag-Along Notice (as defined below) and (y) Company Sale with the Third Party Sale PercentageTransferring Stockholders, at the same price per share and otherwise on the same terms and conditions as the Transferring Stockholders with the same class of stock (“Drag-Along Right”). The Drag-Along Right shall in no way limit QuinStreet’s rights pursuant to Section 3.03.
(b) Subject to Section 3.03, the closing of any Company Sale shall be held at the principal offices of TownB or at such Selling Fortress Entity has agreed other location as TownB and the Proposed Purchaser shall agree, on the closing date set forth in the Company Sale Notice. At the closing of any Company Sale, (a) QuinStreet shall deliver all of its shares of TownB capital stock to the Proposed Purchaser on the same terms and conditions as the other TownB stockholders with such Third Partythe same class of stock, and (b) the Proposed Purchaser shall deliver to QuinStreet the purchase price for its shares of TownB capital stock.
(c) QuinStreet shall execute any customary agreements, certificates, instruments, or other documents as the Proposed Purchaser may reasonably request in connection with and customary for the Company Sale; provided, however, that each any such Holder obligation shall not be permitted to sell no more burdensome in substance for QuinStreet than for any unvested Holder’s Shares (other Transferring Stockholder, and provided further, however, that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall no circumstances will QuinStreet be required to make accept or assume any liability to the Proposed Purchaser for any amount in excess of the purchase price paid to QuinStreet for its TownB capital stock in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership Company Sale.
(d) For purposes hereof, “Transfer” collectively means any sale or other transfer of shares of the Holder’s Shares to capital stock or assets of TownB in a Company Sale, whether by sale or exchange or by merger or consolidation or corporate reorganization or other form of acquisition of TownB or its capital stock.
(e) The foregoing provisions of this Section 3.04 shall be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect applicable to any representation purchaser or transferee of any shares of the capital stock of TownB issued to QuinStreet, and warranty made in connection with as a condition of any such purchase or transfer, QuinStreet shall require the Third Party Sale is proposed purchaser or transferee to agree to become a party to and be bound by the several liability provisions of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii3.04.
(f) unless such Holder is provided an opinion The foregoing provisions of counsel to this Section 3.04 (including all drag-along rights hereunder) shall terminate upon the effect that closing date of the Third Party Sale is not in violation Public Offering of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawTownB securities.
Appears in 1 contract
Drag Along Right. Notwithstanding any other provision hereof(a) In the event that the GC Industrial Member proposes to Transfer to one or more Third-Party Purchasers, if any Holder has not exercised its Tagin a single transaction or a series of related transactions, Interests representing at least a majority of all the Interests (determined on the basis of Percentage Interests), the GC Industrial Member will have the right (the “Drag-Along Right with respect Right”), in its sole discretion, to require each other Member (a “Drag-Along Member”) to Transfer to the maximum number of Holder’s Shares for which Third-Party Purchaser in such Holder is permitted transaction or transactions (pursuant to Section 2(b)(ii)(B) above) to exercise such Taga “Drag-Along Right in respect Transaction”) such portion of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in Interests held by such Third Party Sale Drag-Along Member (in each such entity’s sole discretion)case, such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, “Drag-Along Interests”) equal to the product of percentage derived by dividing (x) the total number of Holder’s Shares held by such Holder on the date Percentage Interests of the GC Industrial Member being Transferred in such Drag-Along Notice (as defined below) and Transaction, divided by (y) the Third Party Sale Percentageaggregate Percentage Interests then held by the GC Industrial Member, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to set forth in this Section 11.03; provided, that the Transfer of Interests held by any Drag-Along Member in connection with such Third PartyDrag-Along Transaction shall be on terms no less favorable than those offered to the GC Industrial Member; provided further that, if (i) consideration received by the Members in connection with such Transfer includes equity securities of any Entity and (ii) following such Transfer, the Members, as a group, are entitled to designate one, but not more than one, member of the board of directors (or similar governing body) of such Entity, the granting to the GC Industrial Member of the right to designate or elect such member of the board of directors (or similar governing body of such Entity) shall not, in and of itself, be deemed to cause the Transfer of the Interests of any Drag Along Member to be on terms less favorable than those offered to the GC Industrial Member.
(b) The aggregate cash purchase price or other consideration payable for all of the Interests being Transferred, converted or exchanged in a Drag-Along Transaction will be allocated among all Members Transferring Interests as if the proceeds of such sale were being distributed to such Members in accordance with Section 5.03(a).
(c) In connection with any Drag-Along Transaction, each Member will execute such documents, and make such representations, warranties, covenants and indemnities, as are executed or made by the GC Industrial Members; provided, however, that each (i) any indemnification obligation of the Members in connection with such Holder shall Drag-Along Transaction for which recourse is not be permitted limited to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting recovery of any unvested Holder’s Shares); provided further that portion of the purchase price paid into escrow will be several (rather than joint) and pro rata as among the Members in accordance with the relative amount of the aggregate consideration to be received by the Members, other than with respect to covenants of, or representations made by, a Member concerning such Selling Fortress Entity shall use its reasonableMember or such Member's ownership or title of any Transferred Interests, good faith efforts the authority or capacity of such Member or due execution, delivery and enforceability of, or conflict of any transaction with, any agreement to provide that (A) the only representation and warranty which such Holder Member is a party and any covenants of such Member and (ii) no Seaspan Member, Washington Member or Tiger Member shall be required to make enter into any covenant or agreement not to compete with any Person in connection with any Drag-Along Transaction. All reasonable fees and expenses incurred by the Third Party Sale is a representation GC Industrial Member (including in respect of financial advisors, accountants and warranty with respect counsel to such Holder’s own ownership of the Holder’s Shares to be sold GC Industrial Member) and by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made Transferring Members in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to Transaction will be shared by the Transferring Members pro rata in accordance with the consideration received by such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawMembers.
Appears in 1 contract
Drag Along Right. Notwithstanding (i) If CHP IV and/or one or more Permitted CHP Transferees proposes to transfer, in a single transaction or a series of related transactions (to the same purchaser or affiliated purchasers), more than 50% of the Shares (assuming the conversion of any convertible securities or the exercise of any option, warrant or any other provision hereofsimilar right in each case as may then be held by CHP IV or any Permitted CHP IV Transferee and in-the-money) owned by CHP IV and all Permitted CHP Transferees either as of the date hereof or, if any Holder has not exercised its Tag-Along Right with respect to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwardsowned by CHP IV and all Permitted CHP Transferees as of the date of such proposed transfer has increased from the number thereof owned by them as of the date hereof, as applicableof the date of such transfer, in a bona fide transaction (but excluding a Permitted Transfer under Sections 5(a) and 5(b)) to one or more unaffiliated third parties (excluding a Permitted CHP Transferee or an Other Stockholder) (and regardless of whether such transfer is by means of a sale of such Shares, a merger of the Company in which such Shares are converted into the right to receive cash, or a sale of all or substantially all of the assets of the Company and a subsequent distribution of the proceeds therefrom), whether or not CHP IV and/or the restrictions Permitted CHP Transferees shall be entitled, by delivery of 30 days’ prior written notice to the Other Stockholders, specifying the name and address of the proposed parties to such transaction and the terms thereof, to require each such Other Stockholder to sell a number of the Shares held by it (plus any Rollover Options as may be necessary to account for Shares on Transfer the basis of Common Stock have lapsed, the Underlying Shares relating thereto) equal to the product of (x) the total outstanding number of Holder’s such Shares held plus the Underlying Shares owned by such Holder on the date Other Stockholder as of the Draglast day of such 30-Along Notice (as defined below) and day period, multiplied by (y) the Third Party Sale Percentagequotient determined by dividing (1) the outstanding number of Shares being transferred by CHP IV and/or the Permitted CHP Transferees and (2) the outstanding number of Shares owned by CHP IV and/or the Permitted CHP Transferees as of the last day of such 30-day period, at the same price and on upon the same terms as the terms on which CHP IV and/or the Permitted CHP Transferees are selling their Shares in the proposed transaction, and conditions such Other Stockholder shall comply and sell its Shares and its Rollover Options computed on the basis of the Underlying Shares relating thereto. The price for any Rollover Option (or portion thereof) being transferred under this Section 6(f) shall be the per Share price to be received by CHP IV or the Permitted CHP Transferee, as the case may be, net of the exercise price therefor, multiplied by the number of Shares for which such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not Rollover Option (or portion thereof) may then be permitted to sell any unvested Holder’s Shares exercised.
(provided that the Company may, in its sole discretion, accelerate the vesting ii) The closing of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts transaction pursuant to provide that (Athis Section 6(f) the only representation and warranty which such Holder shall be required held at such time and place as CHP IV or the Permitted CHP Transferee shall reasonably specify. At such closing, the selling Stockholders shall deliver stock certificates representing the Shares or transfer instruments relating to make in connection with the Third Party Sale is a representation Rollover Options to be sold, duly endorsed for transfer and warranty with respect to such Holder’s own ownership accompanied by all requisite stock transfer taxes, if any, against payment of the Holder’s purchase price therefor, and the Shares and Rollover Options to be sold by it and its ability to convey title thereto transferred shall be free and clear of any liens, charges, claims or encumbrances (other than restrictions imposed pursuant to applicable Securities Laws, the Voting Trusts and adverse claims this Agreement), and (B) each selling Stockholder shall so represent and warrant. Each selling Stockholder shall further represent and warrant that it is the liability record and beneficial owner of such Holder with respect to any representation Shares or Rollover Options and warranty made make such additional representations and warranties as shall be customary in connection with the Third Party Sale is the several liability transactions of such Holder (and not joint with any other person) and that such liability is limited a similar nature subject to the amount provisions of proceeds actually received subsection (h) below. The right of CHP IV or the Permitted CHP Transferee to transfer its Shares and require the sale by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale Other Stockholders of their Shares and Rollover Options pursuant to this Section 2(b)(iii6(f) unless such Holder is provided an opinion shall expire 90 days from the signing of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion definitive agreement with respect to the matters transaction or transactions contemplated by under this provisoSection 6(f).
(iii) At the request of CHP IV, in connection with any transaction in which the drag-along right would be triggered under this Section 6(f) (including a sale, a merger, or a sale of all or substantially all of the assets of the Company and a subsequent distribution of the proceeds therefrom), each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is Stockholder will execute and deliver an irrevocable proxy in the form of a merger transaction, each Holder agrees Exhibit C attached to vote its Holder’s Shares in favor of this Agreement and will not revoke such merger and not proxy prior to exercise any rights of appraisal or dissent afforded under applicable lawthe termination this Agreement.
Appears in 1 contract
Drag Along Right. Notwithstanding any other provision hereofIf the Principal Stockholder proposes to make a bona fide sale of its shares of Common Stock to a third party un-Affiliated with the Principal Stockholder (which may include another stockholder of the Company) in an amount equal to at least 10% of the Fully Diluted Shares (which amount shall be calculated based on the transaction in question or series of transactions related thereto), if any Holder has not exercised its Tagthe Principal Stockholder shall have the right (the "Drag-Along Right Right"), exercisable upon 15 days' prior written notice, to require the Employee to sell a corresponding percentage (as the percentage being sold by the Principal Stockholder) of the number of shares of Common Stock (or then exercisable options) held by the Employee to such third party upon terms no less favorable to the Employee than those that apply to the Principal Stockholder with respect to such third party sale (provided, that the maximum number of Holder’s Shares for which such Holder is permitted (consideration payable to the Employee pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect the sale of a Third Party Sale, then, upon stock option shall be the demand of any Selling Fortress Entity participating amount that would be payable for Common Stock in such Third Party Sale third party sale minus the exercise price of the option). For purposes of calculating such corresponding percentage, there shall be included in such calculation (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer i) shares of Common Stock have lapsedissuable pursuant to options which are then exercisable in accordance with the Plan that are in-the-money, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and (yii) shares of Common Stock. The Employee hereby agrees to cooperate with the Third Party Sale Percentage, at the same price Principal Stockholder and on the same terms to take any and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be all action reasonably required to make in connection with the Third Party Sale is a representation consummation of such third party sale. Without limiting the foregoing, at the closing of any sale under this Section 2.5, the Employee shall deliver certificates representing the shares of Common Stock and warranty with respect to such Holder’s own ownership of agreements representing the Holder’s Shares options to be sold sold, duly endorsed or assigned for transfer and accompanied by it all requisite stock transfer taxes, and its ability to convey title thereto the Employee shall represent and warrant that he/she is the beneficial owner of such shares and options free and clear of liensany Encumbrances, encumbrances with full authority and adverse claims and (B) the liability of power to transfer such Holder with respect to any representation and warranty shares. All Transfers made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel 2.5 shall, if so requested by Jupiter, be subject to the effect that the Third Party Sale is not in violation provisions of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect Section 3 (Transferees Subject to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawAgreement).
Appears in 1 contract
Drag Along Right. Notwithstanding (a) Subject to Section 2.2(b), if the Majority Onex Investors approve a Sale of the Company (the "APPROVED SALE"), the Employee Investors will consent to and raise no objections to the Approved Sale and (i) if the Approved Sale is structured as a sale of Units, the Employee Investors will sell all of their Units and rights to acquire Units on the terms and conditions approved by the Majority Onex Investors, (ii) if the Approved Sale is structured as a merger, consolidation or other reorganization, the Employee Investors will vote in favor thereof and will not exercise any dissenters' rights of appraisal they may have under Delaware law, and (iii) if the Approved Sale is structured as a sale of all or substantially all of the Company's consolidated assets, the Employee Investors will vote in favor thereof. The Employee Investors will use their best efforts to cooperate in the Approved Sale and will take all necessary and desirable actions in connection with the consummation of the Approved Sale as are reasonably requested by the Majority Onex Investors, including, but not limited to, entry into agreements and provision of representations, warranties and indemnification, provided, that no Employee Investor shall be required to enter into substantively different agreements or provide substantively different representations and warranties or indemnification than any other provision hereof, if any Holder has not exercised its Tag-Along Right Equityholder and each Equityholder's obligations thereunder shall be several and limited to the proceeds received by such Equityholder in connection with such Approved Sale.
(b) The obligations of the Employee Investors with respect to the maximum number Approved Sale are subject to the satisfaction of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, thenthe condition that, upon the demand consummation of the Approved Sale, all of the Employee Investors will receive the same form and per Unit amount of consideration for their Units as all other Equityholders, or if any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell Equityholders are given an option as to the respective Third Party form and amount of consideration to be received, all Employee Investors must be given the number same option, provided, that the Approved Sale may provide for payment in securities to all Equityholders that are accredited investors within the meaning of whole Holder’s Shares Regulation D under the Securities Act and in cash to Equityholders that are not accredited investors or may provide Equityholders that are accredited investors with the option to receive securities or cash while Equityholders that are not accredited investors receive cash.
(rounded upwards or downwards, as applicable), whether or not c) If the restrictions on Transfer proposed Approved Sale involves the receipt by Employee Investors of Common Stock have lapsed, equal to the product of (xsecurities for which Section 4(2) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice Securities Act of 1933 or Rule 506 (as defined belowor any similar rule then in effect) promulgated by the Securities and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not Exchange Commission may be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty available with respect to such Holder’s own ownership negotiation or transaction (including a merger, consolidation or other reorganization), the Employee Investors will, at the request of the Holder’s Shares Majority Onex Investors, and to be sold the extent required to comply with Regulation D, appoint a purchaser representative (as such term is defined in Rule 501) reasonably acceptable to the Majority Onex Investor. If any Employee Investor appoints the purchaser representative designated by it and its ability to convey title thereto free and clear of liensthe Majority Onex Investors, encumbrances and adverse claims and (B) the liability Company will pay the fees of such Holder with respect purchaser representative, but if any Employee Investor declines to any representation and warranty made in connection with appoint the Third Party Sale is purchaser representative designated by the several liability of Majority Onex Investors, such Holder holder will appoint another purchaser representative (and not joint with any other person) and that such liability is limited reasonably acceptable to the amount Majority Onex Investors), and such holder will be responsible for the fees of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder purchaser representative so appointed.
(d) No Employee Investor shall not be obligated have any right to participate in any Third Party Sale pursuant to this investment in "Successor Securities", as that term is defined in Section 2(b)(iii5.2(d) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawInvestor Equityholders Agreement.
Appears in 1 contract
Samples: Equityholders Agreement (Emergency Medical Services CORP)
Drag Along Right. Notwithstanding (a) If at any other provision hereoftime and from time to time after the date of this Agreement, if the holder or holders of a majority of the outstanding shares of voting capital stock of the Company (the "Proposed Transferors") wish to Transfer in a bona fide arms' length sale all shares of Common Stock then owned by them to any Holder has Person or Persons who are not exercised its TagAffiliates of the Proposed Transferors (for purposes of this Section 4(a), the "Proposed Transferee"), the Proposed Transferors shall have the right (the "Drag-Along Right with respect to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) aboveRight") to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in require each such entity’s sole discretion), such Holder shall Investor to sell to the respective Third Party Proposed Transferee all shares of Common Stock (for the same per share consideration received by the Proposed Transferor for each such class of capital stock) then held by the Investors, subject to purchase by the Proposed Transferee. Each Investor agrees to take all steps necessary to enable him or it to comply with the provisions of this Section 4(a), including, if necessary, voting any shares of Common Stock in favor of the transaction with the Proposed Transferee (whether effected as a merger or otherwise) to facilitate the Proposed Transferors' exercise of a Drag-Along Right.
(b) To exercise a Drag-Along Right, the Proposed Transferors shall give each Investor a written notice (for purposes of this Section 4, a "Drag- Along Notice") containing (i) the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer shares of Common Stock have lapsedthat the Proposed Transferee proposes to acquire from the Proposed Transferors, equal (ii) the name and address of the Proposed Transferee, and (iii) the proposed purchase price, terms of payment and other material terms and conditions of the Proposed Transferee's offer. Each Investor shall thereafter be obligated to sell the shares of Common Stock subject to such Drag-Along Notice, provided that the -------- sale to the product Proposed Transferee is consummated within 120 days of (x) the total number of Holder’s Shares held by such Holder on the date delivery of the Drag-Along Notice Notice. If the sale is not consummated within such 120-day period, then each Investor shall no longer be obligated to sell such stockholder's shares pursuant to that specific Drag-Along Right but shall remain subject to the provisions of this Section 4.
(as defined belowc) Notwithstanding anything contained in this Section 4, in the event that all or a portion of the purchase price consists of securities and the sale of such securities to the Investors would require either a registration under the Securities Act or the preparation of a disclosure document pursuant to Regulation D under the Securities Act (yor any successor regulation) the Third Party Sale Percentageor a similar provision of any applicable state securities law, then, at the same price and option of the Proposed Transferors, the Management Investors may receive, in lieu of such securities, the fair market value of such securities in cash, as determined in good faith by the Board unless the Management Investors holding a majority of the shares of Common Stock held by Management Investors shall request an appraisal, in which case the appraisal procedure set forth in Section 2(h) shall be followed as closely as practicable, with such Management Investors holding a majority of such shares held by the Management Investors), on the same terms one hand, and conditions as such Selling Fortress Entity has agreed to with such Third Party; providedWarburg, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that on the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this provisohand, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If appointing an appraiser meeting the Third Party Sale is qualifications set forth in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawSection 2(h).
Appears in 1 contract
Samples: Stockholders Agreement (Knoll Inc)
Drag Along Right. Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect to In the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect event the holders of a Third Party Salemajority of the Company's equity securities then outstanding (the "Majority Shareholders") determine to sell or otherwise dispose of all or substantially all of the assets of the Company or all or fifty percent (50%) or more of the capital stock of the Company in each case in a transaction constituting a change in control of the Company, thento any non-Affiliate(s) of the Company or any of the Majority Shareholders, upon or to cause the demand Company to merge with or into or consolidate with any non-Affiliate(s) of the Company or any Selling Fortress Entity participating in such Third Party Sale of the Majority Shareholders (in each such entity’s sole discretioncase, the "Buyer") in a BONA FIDE negotiated transaction (a "Sale"), such Holder the Optionee, including any Permitted Transferees, shall sell be obligated to and shall upon the written request of a Majority Shareholders: (a) sell, transfer and deliver, or cause to be sold, transferred and delivered, to the respective Third Party the number of whole Holder’s Buyer, his or her Issued Shares (rounded upwards including for this purpose all of such Optionee's or downwards, his or her Permitted Transferee's Issued Shares that presently or as applicable), whether or not a result of any such transaction may be acquired upon the restrictions on Transfer exercise of Common Stock have lapsed, equal to options (following the product of (x) the total number of Holder’s Shares held by such Holder on the date payment of the Drag-Along Notice (as defined belowexercise price therefor)) and (y) the Third Party Sale Percentage, at the same price and on substantially the same terms applicable to the Majority Shareholders (with appropriate adjustments to reflect the conversion of convertible securities, the redemption of redeemable securities and conditions the exercise of exercisable securities as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that well as the Company may, in its sole discretion, accelerate the vesting relative preferences and priorities of any unvested Holder’s Sharespreferred stock); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (Bb) the liability execute and deliver such instruments of conveyance and transfer and take such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of other action, including voting such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Issued Shares in favor of such any Sale proposed by the Majority Shareholders and executing any purchase agreements, merger agreements, indemnity agreements, escrow agreements or related documents, as the Majority Shareholders or the Buyer may reasonably require in order to carry out the terms and not to exercise any rights provisions of appraisal or dissent afforded this Section 11. The obligations under applicable lawthis Section 11 shall terminate in accordance with Section 13(a).
Appears in 1 contract
Samples: Non Qualified Stock Option Agreement (Clayton Holdings Inc)
Drag Along Right. Notwithstanding (a) If STIC intends to sell its shares of the domestic parent company to a third party (hereinafter referred to as the “transferee” in this paragraph) in any other provision hereofof the following subparagraphs, if any Holder STIC has not exercised its Tagthe right (“drag-Along Right with respect along right”) to claim against DoubleU Games that all of the shares of the domestic parent company held by DoubleU Games to be sold to the maximum number transferee together under the same conditions as STIC sells to the transferee.
(i) In the event that DoubleU Games does not exercise its Call Option despite the failure of Holderpublic offering under Article 4.1 of this Agreement;
(ii) In the event that DoubleU Games has violated in important point (including but not limited to Article 2, Article 7) of the material content of this Agreement. In this respect, “violate in important point” means the degree to which, in view of the prevailing social norms, because of the breach of one party, it is substantially difficult for the other party to achieve the purpose of the transaction, so that the fulfillment of this Agreement cannot be expected;
(iii) In the event that the reason for the inability to achieve the purpose of the transaction occurs due to impairment of the target company’s Shares for which such Holder is permitted corporate value
(b) If STIC exercises the drag-along right pursuant to Section 2(b)(ii)(B) abovethis Article, STIC shall give the written notice (“exercise notification of the drag-along right”) to exercise such Tag-Along Right in respect of a Third Party SaleDoubleU Games with the share purchase agreement form specifying the sale terms (including the selling price per share, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares selling share and other conditions which are required by law for the transfer and payment of the purchase price of the shares, and other conditions shall not be included without a prior consent from DoubleU Games, (rounded upwards or downwardshereinafter “third party selling condition”) which can be entered into immediately with the transferee.
(c) DoubleU Games, as applicable), whether or not which has been notified of the restrictions on Transfer exercise notification of Common Stock have lapsed, equal the drag-along right pursuant to the product foregoing paragraph, (i) DoubleU Games shall cooperates with the transferee’s due diligence of the domestic parent company, target company and SPC and the sale procedure of the shares which are the subject of STIC’s drag-along exercise; and (xii) under the total number notified selling conditions of Holderthe third party, enter into a share purchase agreement between the transferee attached to the exercise notification of the drag-along right to sell shares which are the subject of STIC’s Shares drag-along exercise to the transferee among the shares of the domestic parent company held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; providedDoubleU Games. Provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting obligation of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale DoubleU Games pursuant to this Section 2(b)(iiiArticle shall be under the condition that (i) unless such Holder is provided an opinion the transferee enters into and carries out a share purchase agreement with DoubleU Games, and (ii) STIC enters into and carries out a share purchase agreement with the transferee, selling its domestic parent company’s shares under the same selling conditions of counsel the third party, and in addition to the effect obligations of DoubleU Games set forth in this Article, it is made clear that DoubleU Games does not guarantee the Third Party Sale outcome of STIC’s exercise of drag-along right and subsequent successful sale of shares.
(d) In the event STIC exercises the drag-along right under this subparagraph, DoubleU Games shall clarify that it is not in violation obliged to purchase CB or BW held by STIC (if converted into a stock or practiced, this shall include the stocks of applicable federal and state securities or other laws orthe domestic parent company). Provided, however, if such Holder is DoubleU Games fails to fulfil its obligations even though all the conditions under the proviso of subparagraph (c) have been met, or if the share purchase agreement between the STIC and the transferee has not provided with an opinion with respect been terminated, it shall again be subject to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded purchase obligation under applicable lawArticle 3.3.
Appears in 1 contract
Samples: Joint Investment Agreement (DoubleDown Interactive Co., Ltd.)
Drag Along Right. Notwithstanding So long as Sopica, directly or indirectly, continues to hold, directly or indirectly, at least 20% of the issued and outstanding Common Shares (including any other provision hereofClass A Common Shares on as-converted to Common Shares basis), at any time following December 31, 2025, if any Holder has not exercised its Tag-Sopica approves a Sale of the Company in writing for a deemed price per Share of no less than [Redacted – Commercially Sensitive Information] (a “Drag Along Right with respect Sale”), specifying that this Section 6.8 shall apply to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Drag Along Right in respect of a Third Party Sale, then, upon subject to the demand satisfaction of any Selling Fortress Entity participating each of the conditions set forth in Section 6.9, each Shareholder and the Company hereby agree:
(a) if the Drag Along Sale requires shareholder approval, with respect to all Shares that such Third Party Sale Shareholder owns or over which such Shareholder otherwise exercises voting power, to vote (in each such entity’s sole discretion)person, such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards by proxy or downwardsby action by written consent, as applicable)) all Shares in favor of, whether or not the restrictions on Transfer of Common Stock have lapsedand adopt, equal such Drag Along Sale (together with any related amendment to the product Articles required to implement the Drag Along Sale) and to vote in opposition to any and all other proposals that could reasonably be expected to delay or impair the ability of the Company to consummate the Drag Along Sale;
(xb) if the total number Drag Along Sale is a Stock Sale, to sell the same proportion of Holder’s Shares share capital of the Company beneficially held by such Holder on Shareholder as is being sold by the date of Selling Shareholders to the Drag-Along Notice (Person to whom Sopica proposes to sell their Shares, and, except as defined permitted in Section 6.9 below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as the other shareholders of the Company;
(c) to execute and deliver all related documentation and take such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder other action in support of the Drag Along Sale as shall not reasonably be permitted to sell any unvested Holder’s Shares (provided that requested by the Company mayor Sopica in order to carry out the terms and provision of this Section 6.8, including executing and delivering instruments of conveyance and transfer, and any purchase agreement, amalgamation agreement, any associated indemnity agreement or escrow agreement, any associated voting, support or joinder agreement, consent, waiver, governmental filing, share certificates duly endorsed for transfer (free and clear of impermissible liens, claims and encumbrances), and any similar or related documents;
(d) not to deposit, and to cause their Affiliates not to deposit, except as provided in its sole discretionthis Agreement, accelerate any Shares owned by such party or Affiliate in a voting trust or subject any Shares to any arrangement or agreement with respect to the vesting voting of any unvested Holder’s such Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts unless specifically requested to provide that (A) do so by the only representation and warranty which such Holder shall be required to make acquiror in connection with the Third Party Sale is Drag Along Sale;
(e) to refrain from exercising any dissent rights or rights of appraisal under applicable law at any time with respect to the Drag Along Sale;
(f) if the consideration to be paid in exchange for the Shares pursuant to this Section 6.8 includes any securities and due receipt thereof by any Shareholder would require under applicable law (x) the registration or qualification of such securities or of any Person as a representation and warranty broker or dealer or agent with respect to such Holder’s own ownership securities; or (y) the provision to any Shareholder of any information other than such information as a prudent issuer would generally furnish in an offering made solely to “accredited investors” (as defined in National Instrument 45-106 – Prospectus Exemptions (“NI 45-106”)), the Company may cause to be paid to any such Shareholder in place thereof, against surrender of the Holder’s Shares to be which would have otherwise been sold by it and its ability such Shareholder, an amount in cash equal to convey title thereto free and clear the fair value (as determined in good faith by the Board) of liens, encumbrances and adverse claims and (B) the liability securities which such Shareholder would otherwise receive as of the date of the issuance of such Holder with respect to any representation and warranty made securities in exchange for the Shares;
(g) if Sopica, in connection with the Third Party Sale is Drag Along Sale, appoints a shareholder representative (the several liability of such Holder (and not joint with any other person“Shareholder Representative”) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to matters affecting the matters contemplated by this provisoShareholders under the applicable definitive transaction agreements following consummation of the Drag Along Sale, each Selling Fortress Entity who has delivered a Drag-Along Notice (x) to such Holder shall indemnify such Holder for any such violation. If consent to (i) the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor appointment of such merger and not to exercise any rights of appraisal or dissent afforded under applicable law.Shareholder Representative,
Appears in 1 contract
Samples: Shareholder Agreement
Drag Along Right. Notwithstanding any other provision hereofSubject to the AAG ROFR:
(a) LMP Member may initiate a Sale Transaction with a Third Party in accordance with this Section 7.11(a) by delivery of written notice to the Company and, if any Holder has not exercised its Tagupon delivery of such notice, shall have the rights described in this Section 7.11 (such right a “Drag-Along Right Right” and such Sale Transaction, a “Drag-Along Transaction”).
(b) In connection with respect to the maximum number of Holder’s Shares for which such Holder is permitted (any Drag-Along Transaction initiated pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion7.11(a), such Holder shall sell and subject to the respective Third Party terms and conditions set forth in this Section 7.11, AAG Member hereby does (and shall promptly, if required by the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not LMP Member) consent in writing to and raise no objections against the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date consummation of the Drag-Along Notice Transaction, and if the Drag-Along Transaction is structured as (as defined belowi) a consolidation, merger or other business combination, or a sale or other disposition of all or substantially all of the assets of the Company and/or its Subsidiaries, each holder of Membership Interests entitled to vote thereon shall vote in favor of the Drag-Along Transaction and shall waive any appraisal rights or similar rights in connection with such consolidation, merger, other business combination or asset sale or (ii) a sale of all of its Membership Interests, AAG Member hereby agrees (and, if required by the LMP Member, shall promptly agree in writing) to sell all of its Membership Interests that are the subject of the Drag-Along Transaction, on the terms and conditions of such Drag-Along Transaction. AAG member shall promptly take all necessary and desirable actions in connection with the consummation of the Drag-Along Transaction reasonably requested by the LMP Member, including the execution of such agreements and such other instruments and other actions reasonably necessary to (x) provide customary representations, warranties, indemnities, and escrow or holdback arrangements relating to such Drag-Along Transaction, in each case to the extent that each other holder of Membership Interests is similarly obligated; and (y) effectuate the Third Party Sale Percentageallocation and distribution of the aggregate consideration upon the Drag-Along Transaction as set forth in Section 7.11(c). Subject to the satisfaction or waiver of the AAG ROFR, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder holders of Membership Interests shall not be permitted to sell their Membership Interests pursuant to any unvested Holder’s Shares Drag-Along Transaction without complying with any other provisions of this Article VII.
(provided c) The obligations of the holders of Membership Interests pursuant to this Section 7.11 are subject to the following terms and conditions:
(i) upon the consummation of the Drag-Along Transaction, each holder of Membership Interests shall receive the same proportion of the aggregate consideration from such Drag-Along Transaction that such holder would have received if such aggregate consideration had been distributed by the Company mayin complete liquidation pursuant to the rights and preferences set forth in Section 12.1 (i.e., net of debts and liabilities of the Company and its Subsidiaries) as in effect immediately prior to the consummation of such Drag-Along Transaction, and if a holder of Membership Interests receives consideration from such Drag-Along Transaction in a manner other than as contemplated by such rights and preferences or in excess of the amount to which such holder is entitled in accordance with such rights and preferences, then such holder shall take such action as is necessary so that such consideration shall be immediately reallocated among and distributed to the holders of Membership Interests in accordance with such rights and preferences;
(ii) the Company shall bear the reasonable, documented costs incurred in connection with any Drag-Along Transaction (costs incurred by or on behalf of any holder of Membership Interests for its sole benefit will not be considered costs of the Drag-Along Transaction) unless otherwise agreed by the Company (as approved by the Board) and the acquiror, in its sole discretion, accelerate the vesting which case no holder of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder Membership Interests shall be required obligated to make any out-of-pocket expenditure prior to the consummation of the Drag-Along Transaction (excluding modest expenditures for postage, copies, and the like) and no holder of Membership Interests shall be obligated to pay any portion (or, if paid, shall be entitled to be reimbursed by the Company for that portion paid) that is more than its pro rata share (based upon the amount of consideration received by such holder in the Drag-Along Transaction) of reasonable expenses incurred in connection with a consummated Drag-Along Transaction for the benefit of all holders of Membership Interests and are not otherwise paid by the Company or another Person;
(iii) consideration placed in escrow or held back shall be allocated among holders of Membership Interests such that if the applicable Third Party in the Drag-Along Transaction ultimately is entitled to some or all of such escrow or holdback amounts, then the net ultimate proceeds received by such holders shall still comply with the intent of Section 7.11(c)(i) as if the ultimate resolution of such escrow or holdback had been known at the closing of the Drag-Along Transaction; and
(iv) if some or all of the consideration received in connection with the Third Party Sale Drag-Along Transaction is other than cash, then such consideration shall be deemed to have a representation and warranty with respect dollar value equal to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability fair market value of such Holder with respect to any representation and warranty made consideration (as determined, in connection with good faith, by the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party SaleBoard); provided further, that a Holder the AAG Member shall not be obligated required to participate in any Third Party Sale pursuant consent to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice Transaction if the consideration to be received in connection with such Holder shall indemnify such Holder for any such violation. If the Third Party Sale Drag-Along Transaction is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawother than cash.
Appears in 1 contract
Samples: Membership Interest Purchase Agreement (LMP Automotive Holdings, Inc.)
Drag Along Right. Notwithstanding (i) Upon the affirmative vote by seventy percent (70%) of the Board of Directors any time in connection with a proposed offer (a “Third Party Offer”) by a third party (a “Third Party”) for Investor Holdco to, directly or indirectly, sell, transfer, assign or otherwise dispose of (“Transfer”) 50% or more of the outstanding Company Shares to any Person (an “Offeror”), each other provision hereof, if any Holder has not exercised its Tag-Along Right with respect holder of Company Shares (an “Other Stockholder”) shall be required to Transfer the pro rata portion of their Company Shares to the maximum number Offeror upon the same terms and conditions as Investor Holdco; provided, that (A) no Other Stockholder shall be required to make any representations or warranties other than representations, warranties or agreements regarding such Other Stockholder’s title to such Company Shares, and such Other Stockholder’s authority to sell such Company Shares, and (B) the aggregate amount of Holderthe liability of such Other Stockholder shall not exceed such Other Stockholder’s net proceeds from such proposed Transfer of Company Shares for which to such Holder is permitted Offeror. Investor Holdco shall promptly and acting in good faith (pursuant to Section 2(b)(ii)(BA) above) to exercise such Tag-Along Right in respect of a cause the Third Party SaleOffer to be reduced to writing, thenspecifying the Offeror, upon the demand price to be paid by the Third Party for Company Shares and all other material terms and conditions of any Selling Fortress Entity participating in the Third Party Offer, and (B) provide a notice of such Third Party Sale Offer to each of the other holders of Company Shares (in each such entity’s sole discretion), such Holder shall sell to the respective a “Third Party the number of whole Holder’s Shares Notice”). The Third Party Notice shall (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (xw) the total number of Holder’s Shares held contain an unconditional offer by such Holder on Offeror to purchase or otherwise acquire from each Other Stockholder such Other Stockholders’ Company Shares simultaneously with the date purchase by the Offeror of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and all of Investor Holdco’s Company Shares on the same terms and conditions as such Selling Fortress Entity has agreed the Third Party Offer, (x) be accompanied by a true and correct copy of the Third Party Offer, (y) specify the total Company Shares then owned by Investor Holdco and (z) indicate that the Third Party Notice is being delivered to with the Other Stockholders pursuant to this Section 2.03(f)(i).
(ii) In the event that the terms and conditions of any Third Party Offer shall be modified in any way prior to the consummation of the respective Transfers of Company Shares contemplated by such Third Party; providedParty Offer, however, that each such Holder Investor Holdco shall not be permitted send a copy of the amended Third Party Offer to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate and each of the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder Other Stockholders. The Other Stockholders shall be required to make transfer their Company Shares in connection accordance with the such modified Third Party Sale Offer only if such modified Third Party Offer is a representation and warranty with respect to such Holder’s own ownership approved by the affirmative vote of seventy percent (70%) of the HolderBoard of Directors.
(iii) At the closing, each holder of Company Shares shall Transfer such holder’s Company Shares to be sold by it and its ability to convey title thereto such Offeror free and clear of any and all liens, mortgages, pledges, security interests or other restrictions or encumbrances, except encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with incurred by the Third Party Sale is Party, against payment of the several liability of purchase price for such Holder (and not joint with any other person) and that Company Shares. If such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided furtherdoes not purchase such Company Shares from all holders and Investor Holdco on the same terms and conditions applicable to Investor Holdco, that a Holder then the entire proposed Transfer of Company Shares to such Offeror shall not be obligated to participate in any Third Party Sale pursuant to take place.
(iv) The preceding provisions of this Section 2(b)(iii2.03(f) unless such Holder is provided shall terminate upon an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawIPO.
Appears in 1 contract
Samples: Shareholder Agreements (Albertsons Companies, Inc.)
Drag Along Right. Notwithstanding (i) If at any other provision hereoftime and from time to time after the date of this Agreement Common Holders holding a majority of all shares of Common Stock then issued and outstanding (whether or not any or all of such shares are held separately or as part of Investment Units, the "Transferring Investors") wish to Transfer in a bona fide arm's-length sale for cash consideration all of the Common Stock (and, if prior to a Separation Event, the 4 7 Investment Units) held by the Transferring Investors to any Holder has Person or Persons who are not exercised its TagAffiliates of the Transferring Investors (for purposes of this Section 1(c), the "Proposed Transferee"), the Transferring Investors shall have the right (the "Drag-Along Right Right"), subject to applicable law and compliance with Section 1(a) with respect to the maximum number of Holder’s Shares for which such Holder is permitted Transfer, to require all (but not less than all) other Common Holders to sell, pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion1(c)(ii), such Holder shall sell to the respective Third Party Proposed Transferee all (but not less than all) of the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer shares of Common Stock have lapsed(and, equal if prior to a Separation Event, the Investment Units) then owned by such other Common Holders. Each Common Holder agrees to take all steps necessary to enable such Common Holder to comply with the provisions of this Section 1(c).
(ii) To exercise a Drag-Along Right, the Transferring Investors shall give each other Common Holder and the Company a written notice (for purposes of this Section 1(c), a "Drag-Along Notice") containing (a) the aggregate number of shares of Common Stock (and, if prior to a Separation Event, the Investment Units) that the Proposed Transferee proposes to acquire from the Transferring Investors and the other Common Holders, (b) the name and address of the Proposed Transferee and (c) the proposed purchase price, terms of payment and other material terms and conditions of the Proposed Transferee's offer. Each Common Holder shall thereafter be obligated, subject to applicable law, to sell all (but not less than all) of its shares of Common Stock (and, if prior to a Separation Event, its Investment Units) as provided in such Drag-Along Notice, provided that the sale to the product Proposed Transferee is consummated within one hundred and twenty (120) days of (x) the total number of Holder’s Shares held by such Holder on the date delivery of the Drag-Along Notice (as defined below) and (y) Notice. If the Third Party Sale Percentagesale is not consummated within such 120-day period, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that then each such Common Holder shall not no longer be permitted obligated to sell any unvested such Common Holder’s Shares 's shares of Common Stock (provided or, if prior to a Separation Event, Investment Units) pursuant to that specific Drag-Along Right but shall remain subject to the Company may, in its sole discretion, accelerate the vesting provisions of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (Athis Section 1(c) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a subsequent Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawRights.
Appears in 1 contract
Drag Along Right. Notwithstanding any In the event that, prior to the ---------------- Tag-Along/Drag-Along Termination Date, a Selling Holder engages in a Tag-Along/Drag-Along Transaction, the Selling Holder shall have the right (a "Drag-Along Right") to require each other provision hereofHolder and Other Party to participate ---------------- in such transaction on substantially the same terms as the Selling Holder by including in such transaction (i) in the case of a Holder, the same percentage of such other Holder's New Common Stock as the New Common Stock being sold by the Selling Holder represents of all of the Selling Holder's New Common Stock and (ii) in the case of an Other Party, the same percentage of currently exercisable options to purchase New Common Stock held by such Other Party (after giving effect, if applicable, to the acceleration of vesting of any options by reason of such Tag-Along/Drag-Along Transaction) as the New Common Stock being sold by the Selling Holder has not exercised its Tagrepresents of all of the Selling Holder's New Common Stock, as follows:
(a) The Selling Holder's Drag-Along Right shall apply to all other Holders and Other Parties equally and may not be exercised selectively with respect to the maximum number other Holders and Other Parties.
(b) The Selling Holder shall deliver to the Company a written notice (a "Drag-Along Rights Notice") of the Selling Holder’s Shares 's exercise of its Drag-Along ------------------------ Right in such transaction at least 30 days prior to consummating any such transaction setting forth all material details of such transaction, and the Company shall promptly deliver such Drag-Along Rights Notice to each other Holder and Other Party.
(c) In the case of an Other Party, (i) the purchase price for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to any stock options in connection with the exercise such Tagof a Drag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell be equal to the respective Third Party purchase price pursuant to the Drag Along Notice attributable to the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer shares of New Common Stock have lapsed, equal to issuable upon the product exercise of such option less the exercise price thereof and (xii) the total number of Holder’s Shares held by such Holder on the date notwithstanding any provision of the Drag-Along Notice Option Agreements, such options shall be deemed assignable to and exercisable in the hands of any purchaser pursuant to this Section 5.2.
(d) The Selling Holder shall provide each other Holder and Other Party with such information and instructions as defined below) shall be necessary to enable such other Holder and (y) Other Party to participate in the Third Party Sale Percentage, at the same price and intended transaction on substantially the same terms and conditions as such the Selling Fortress Entity has agreed to with such Third Party; providedHolder, however, that and each such other Holder and Other Party shall cooperate in such transaction by providing the Selling Holder all materials, such as executed purchase and sale agreements and stock transfer documentation, as the Selling Holder may reasonably request.
(e) The Selling Holder shall not be permitted to sell any unvested Holder’s Shares (provided that have the Company mayright, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts at all times prior to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership consummation of the Holder’s Shares transaction to be sold by it abandon, rescind, annul, withdraw or otherwise terminate such transaction, and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Selling Holder shall not be obligated have any liability or obligation to participate in any Third other Holder or Other Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect thereto. Nothing herein shall be construed to obligate the matters contemplated by this provisoSelling Holder to accept any offer or terms for, each Selling Fortress Entity who has delivered a or to consummate, any Tag-Along/Drag-Along Notice Transaction or other transaction.
(f) The Holders hereby agree and acknowledge that their agreement to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form provisions of a merger transaction, each Holder agrees this Section 5.2 constitutes their irrevocable proxy to vote its Holder’s Shares in favor for, and to waive any appraisal rights with respect to, any merger or business combination transaction that has been approved by a vote of such merger and not to exercise any rights Holders holding 60% or more of appraisal or dissent afforded under applicable lawthe outstanding shares of New Common Stock.
Appears in 1 contract
Drag Along Right. Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right (a) If an Investor or group of Investors with respect an aggregate Investor Percentage Interest equal to or greater than 50% (the maximum number of Holder’s Shares for which such Holder is permitted (pursuant “Dragging Investor”) proposes to Section 2(b)(ii)(B) above) consummate a Company Sale to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Purchaser (a “Drag Third Party Sale Purchaser”) in exchange for cash and/or freely transferable and marketable securities (in each such entity’s sole discretion)a transaction, such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the a “Drag-Along Notice (as defined below) Sale”), then such Dragging Investors shall have the right to require each Investor to include its Common Shares in such Company Sale and/or vote its Common Shares and (y) the Third Party Sale Percentage, at the same price and take any other actions in furtherance thereof on the same terms and conditions as applicable to the Dragging Investors, including by waiving any appraisal or similar rights with respect to the Drag-Along Sale and executing any action by written consent of the Investors. Such right shall be exercisable by written notice (a “Buyout Notice”) given to each Investor other than the Dragging Investors that shall state (i) that such Selling Fortress Entity has agreed Dragging Investors propose to with effect the Drag-Along Sale to such Drag Third Party; providedParty Purchaser, however(ii) the name of the Drag Third Party Purchaser, and (iii) the purchase price the Drag Third Party Purchaser is paying for the Common Shares and that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting include a copy of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make definitive agreements in connection with the Third Party Sale is such Drag-Along Sale. Each such Investor agrees that, upon receipt of a representation and warranty with respect to Buyout Notice, such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder Investor shall not be obligated to participate sell all of its Common Shares for the purchase price set forth in the Buyout Notice (on the same price and with the same (but proportionate) amount of consideration or choice of consideration given to all other Investors) and on the other terms and subject to the conditions of such transaction (and otherwise take all reasonably necessary action to cause consummation of the proposed transaction).
(b) The closing of any Third Party Drag-Along Sale pursuant to this Section 2(b)(iii) unless such Holder 3.3 shall be held as promptly as practicable and at the time and place specified in the Buyout Notice, but in any event within nine months after the date the Buyout Notice is provided an opinion of counsel delivered to the effect Investors; provided, that such nine-month period may be extended at the election of the Dragging Investors for a period of up to 90 days to the extent necessary to obtain any regulatory approvals required in connection with the Drag-Along Sale (the “Drag-Along Outside Date”). Consummation of the Transfer of Common Shares by any Investor to the Drag Third Party Purchaser in a Drag-Along Sale is not in violation (i) shall be conditioned upon consummation of applicable federal the Transfer by each Dragging Investor to such Drag Third Party Purchaser of the Common Shares proposed to be Transferred by the Dragging Investor and state securities (ii) may be effected by a Transfer of such Common Shares or the merger, consolidation or other laws orcombination of the Company with or into the Drag Third Party Purchaser or any of its Affiliates, if such Holder is not provided with an opinion in one or a series of related transactions. If the proposed Transfer with respect to the matters contemplated by this provisoapplicable Common Shares subject to the Buyout Notice does not meet the requirements of Section 3.3(a) prior to the Drag-Along Outside Date, such Dragging Investors shall be deemed to have forfeited their rights to require the other Investors to sell all of their Common Shares to such Drag Third Party Purchaser in connection with such Drag-Along Sale.
(c) In connection with any Transfer pursuant to a Buyout Notice, each Selling Fortress Entity who has delivered Investor shall execute the applicable transaction agreement and make or provide the same representations, warranties, covenants, indemnities, agreements, escrows and holdback arrangements as the Dragging Investors make or provide in connection with the Drag-Along Sale (such representations, warranties, covenants, indemnities, agreements, escrows and holdback arrangements to be set forth in the Buyout Notice); provided, that each Investor shall be obligated to make only individual representations and warranties with respect to its title to and ownership of the applicable Common Shares, authorization, execution and delivery of relevant documents, enforceability of such documents against such Investor, and other matters relating to such Investor, but not with respect to any of the foregoing with respect to any other Investors or their Common Shares or the Company and its Subsidiaries; provided, further, that all representations and warranties in the applicable transaction agreement with respect to the Company and its Subsidiaries shall be made by the Dragging Investors or the Company and the other Investors shall be severally and not jointly liable with respect to any indemnification obligation with respect thereto, and any such indemnification obligation shall be pro rata based on the proceeds received by such Investors, in each case, in an amount not to exceed the aggregate proceeds received by such Investors; provided, further, in no event shall any Investor be required to enter into a non-compete, non-solicit or other similar restrictive covenant. Any transaction costs, including legal, accounting and investment banking fees and expenses incurred in connection with a Drag-Along Notice Sale and for the benefit of all Investors (it being understood that costs incurred by or on behalf of an Investor for its sole benefit shall not be considered to be for the benefit of all Investors), shall be paid or reimbursed by the Company or the Drag Third Party Purchaser.
(d) Each Investor hereby grants to the Company (i) an irrevocable proxy coupled with an interest to vote, including in any action taken by written consent, such Holder shall indemnify Investor’s Common Shares to approve any Drag-Along Sale pursuant to this Section 3.3 and (ii) an irrevocable power of attorney coupled with an interest to execute and deliver in the name and on behalf of such Holder for Investor all such agreements, instruments and other documentation as is required to transfer such Investor’s Common Shares and to take any other actions in furtherance thereof, subject to the limitations set forth in Section 3.3(c). Notwithstanding the foregoing, the Company may exercise the proxy and power of attorney granted by each Investor pursuant to this Section 3.3(d) at any time as may be necessary to consummate a Drag-Along Sale pursuant to this Section 3.3 only if such Investor fails to comply with the provisions of this Section 3.3 within five days of receiving notice of any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawrequest.
Appears in 1 contract
Drag Along Right. Notwithstanding (a) In the event that one or more Shareholders holding Shares aggregating more than 50% of the outstanding voting power of the Company (the “Triggering Shareholders”) determines to effect a Company Sale or sell or otherwise dispose of all or substantially all of the assets of the Company determined on a consolidated basis or all or substantially all of the capital stock of the Company in a bona fide negotiated transaction and such transaction has been approved by all holders of Shares entitled to approve or consent to such transaction (an “Approved Sale”), each Shareholder shall be obligated to and shall upon written request of the Triggering Shareholders: (i) consent to and raise no objections against the Approved Sale, (ii) if the Approved Sale is structured as (A) a merger or consolidation, waive any dissenters or similar rights in connection with such merger or consolidation, (B) a sale of capital stock, agree to sell all of his Shares on the terms and conditions approved by the Triggering Shareholders, or (C) as a sale of assets, vote in favor of such sale and any subsequent liquidation of the Company or other provision hereofdistribution of the proceeds therefrom, if (iii) execute and deliver such instruments of conveyance and transfer and take all other necessary or desirable actions in connection with the consummation of the Approved Sale reasonably requested by the Triggering Shareholders (including, without limitation, executing any Holder has not exercised its Tag-Along Right purchase agreements, merger agreements, escrow agreements and related agreements) and (iv) join on a pro rata basis (based on the share of the aggregate proceeds received by such Shareholder from such Approved Sale) in any indemnification or other obligations that the Triggering Shareholders agree to provide in connection with such Approved Sale other than any such obligations that relate specifically to a particular Shareholder such as indemnification with respect to the maximum number representations and warranties given by a Shareholder regarding title to and ownership of HolderShares; provided that (i) any Shareholder’s Shares for which aggregate liability (absent fraud) in connection with such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise Approved Sale shall not exceed such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in Shareholder’s proceeds from such Third Party Approved Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and (yii) the Third Party Sale Percentage, at the same price and on the same terms and conditions as that no such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder Shareholder shall be required to make in connection with any representation or warranty (other than that such Shareholder has good title to the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be being sold by it and its ability to convey title thereto such Shareholder, free and clear of liensany liens and authority to sell), encumbrances and adverse claims and or covenant or indemnity except that such Shareholder shall be required to participate in all indemnification obligations on a pro rata basis so long as such Shareholder’s liability (Babsent fraud) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder sale shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless exceed such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if Shareholder’s proceeds from such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawsale.
Appears in 1 contract
Drag Along Right. Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right
(a) If an Investor or group of Investors with respect an aggregate Investor Percentage Interest equal to or greater than 50% (the maximum number of Holder’s Shares for which such Holder is permitted (pursuant “Dragging Investor”) proposes to Section 2(b)(ii)(B) above) consummate a Company Sale to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Purchaser (a “Drag Third Party Sale Purchaser”) in exchange for cash and/or freely transferable and marketable securities (in each such entity’s sole discretion)a transaction, such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the a “Drag-Along Notice (as defined below) Sale”), then such Dragging Investors shall have the right to require each Investor to include its Common Shares in such Company Sale and/or vote its Common Shares and (y) the Third Party Sale Percentage, at the same price and take any other actions in furtherance thereof on the same terms and conditions as applicable to the Dragging Investors, including by waiving any appraisal or similar rights with respect to the Drag-Along Sale and executing any action by written consent of the Investors. Such right shall be exercisable by written notice (a “Buyout Notice”) given to each Investor other than the Dragging Investors that shall state (i) that such Selling Fortress Entity has agreed Dragging Investors propose to with effect the Drag-Along Sale to such Drag Third Party; providedParty Purchaser, however(ii) the name of the Drag Third Party Purchaser, and (iii) the purchase price the Drag Third Party Purchaser is paying for the Common Shares and that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting include a copy of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make definitive agreements in connection with the Third Party Sale is such Drag-Along Sale. Each such Investor agrees that, upon receipt of a representation and warranty with respect to Buyout Notice, such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder Investor shall not be obligated to participate sell all of its Common Shares for the purchase price set forth in the Buyout Notice (on the same price and with the same (but proportionate) amount of consideration or choice of consideration given to all other Investors) and on the other terms and subject to the conditions of such transaction (and otherwise take all reasonably necessary action to cause consummation of the proposed transaction).
(b) The closing of any Third Party Drag-Along Sale pursuant to this Section 2(b)(iii) unless such Holder 3.3 shall be held as promptly as practicable and at the time and place specified in the Buyout Notice, but in any event within nine months after the date the Buyout Notice is provided an opinion of counsel delivered to the effect Investors; provided, that such nine-month period may be extended at the election of the Dragging Investors for a period of up to 90 days to the extent necessary to obtain any regulatory approvals required in connection with the Drag-Along Sale (the “Drag-Along Outside Date”). Consummation of the Transfer of Common Shares by any Investor to the Drag Third Party Purchaser in a Drag- Along Sale is not in violation (i) shall be conditioned upon consummation of applicable federal the Transfer by each Dragging Investor to such Drag Third Party Purchaser of the Common Shares proposed to be Transferred by the Dragging Investor and state securities (ii) may be effected by a Transfer of such Common Shares or the merger, consolidation or other laws orcombination of the Company with or into the Drag Third Party Purchaser or any of its Affiliates, if such Holder is not provided with an opinion in one or a series of related transactions. If the proposed Transfer with respect to the matters contemplated by this provisoapplicable Common Shares subject to the Buyout Notice does not meet the requirements of Section 3.3(a) prior to the Drag-Along Outside Date, such Dragging Investors shall be deemed to have forfeited their rights to require the other Investors to sell all of their Common Shares to such Drag Third Party Purchaser in connection with such Drag-Along Sale.
(c) In connection with any Transfer pursuant to a Buyout Notice, each Selling Fortress Entity who has delivered Investor shall execute the applicable transaction agreement and make or provide the same representations, warranties, covenants, indemnities, agreements, escrows and holdback arrangements as the Dragging Investors make or provide in connection with the Drag-Along Sale (such representations, warranties, covenants, indemnities, agreements, escrows and holdback arrangements to be set forth in the Buyout Notice); provided, that each Investor shall be obligated to make only individual representations and warranties with respect to its title to and ownership of the applicable Common Shares, authorization, execution and delivery of relevant documents, enforceability of such documents against such Investor, and other matters relating to such Investor, but not with respect to any of the foregoing with respect to any other Investors or their Common Shares or the Company and its Subsidiaries; provided, further, that all representations and warranties in the applicable transaction agreement with respect to the Company and its Subsidiaries shall be made by the Dragging Investors or the Company and the other Investors shall be severally and not jointly liable with respect to any indemnification obligation with respect thereto, and any such indemnification obligation shall be pro rata based on the proceeds received by such Investors, in each case, in an amount not to exceed the aggregate proceeds received by such Investors; provided, further, in no event shall any Investor be required to enter into a non-compete, non-solicit or other similar restrictive covenant. Any transaction costs, including legal, accounting and investment banking fees and expenses incurred in connection with a Drag-Along Notice Sale and for the benefit of all Investors (it being understood that costs incurred by or on behalf of an Investor for its sole benefit shall not be considered to be for the benefit of all Investors), shall be paid or reimbursed by the Company or the Drag Third Party Purchaser.
(d) Each Investor hereby grants to the Company (i) an irrevocable proxy coupled with an interest to vote, including in any action taken by written consent, such Holder shall indemnify Investor’s Common Shares to approve any Drag-Along Sale pursuant to this Section 3.3 and (ii) an irrevocable power of attorney coupled with an interest to execute and deliver in the name and on behalf of such Holder for Investor all such agreements, instruments and other documentation as is required to transfer such Investor’s Common Shares and to take any other actions in furtherance thereof, subject to the limitations set forth in Section 3.3(c). Notwithstanding the foregoing, the Company may exercise the proxy and power of attorney granted by each Investor pursuant to this Section 3.3(d) at any time as may be necessary to consummate a Drag-Along Sale pursuant to this Section 3.3 only if such Investor fails to comply with the provisions of this Section 3.3 within five days of receiving notice of any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable law.request.
Appears in 1 contract
Samples: Stockholders Agreement
Drag Along Right. Notwithstanding (a) If at any other provision hereoftime during a Marketing Period, if any Holder has not exercised its Tagthe Offerors (for the purposes of this Section 9.03, the “Drag-Along Right Sellers”) enter into a binding, definitive agreement complying with respect the terms of this Section 9.03 to Transfer all or substantially all of the maximum number of Holder’s Shares for which such Holder is permitted Units (pursuant to Section 2(b)(ii)(Bor Echo Shares) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale then outstanding (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of such Units (xor Echo Shares) the total number of Holder’s Shares are held by such Holder on the date of the Drag-Along Sellers) to a third party (the “Drag-Along Transferee”) in connection with a Company Sale that was treated as a ROFO Sale and for which the Drag-Along Sellers had included in the Offer Notice a statement that such ROFO Sale would be a Drag-Along Sale (whether structured as defined belowa sale of Units (or Echo Shares), merger or other business combination) (a “Drag-Along Sale”), the Drag-Along Sellers may at their option require each other Member (each, a “Dragged Member”) to, (x) Transfer all (but not less than all) Units held by such Member (or Echo Shares, in the case Echo is the Dragged Member) to the Drag-Along Transferee for the same consideration (based on the pro rata Membership Percentages of the Members) and, (y)
(1) vote such Dragged Member’s Units (and Echo Shares, in the case Echo is the Dragged Member) in favor thereof, and otherwise consent to and raise no objection to such Drag-Along Sale, and waive any dissenters’ rights, appraisal rights or similar rights that such Dragged Member may have in connection therewith and (y2) be a party to the Third Party definitive agreement(s) governing the terms and conditions of such Drag-Along Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Partythe Drag-Along Sellers (except as provided in Section 9.03(c)); provided, howeverthat to the extent Echo is the Dragged Member, that each such Holder shall not the holders of Echo Shares will be permitted to sell any unvested Holder’s Shares (provided that the Company mayentitled, in its the sole discretiondiscretion of Echo, accelerate to substitute for the vesting Units to be Transferred by Echo in such Drag-Along Sale all of any unvested HolderEcho’s Shares); provided further capital stock for the same consideration that would have otherwise been payable in respect of such Selling Fortress Entity Units.
(b) The Drag-Along Sellers shall use its reasonableprovide notice of such Drag-Along Sale to the Dragged Members (a “Drag-Along Sale Notice”) not later than fifteen (15) days prior to the consummation of the proposed Drag-Along Sale. The Drag-Along Sale Notice shall identify the Drag-Along Transferee, good faith efforts the consideration proposed to provide that (A) the only representation and warranty which such Holder shall be required to make paid in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder Sale (the “Drag-Along Sale Price”) and all other material terms and conditions of the Drag-Along Sale, which shall indemnify such Holder for any such violation. If the Third Party Sale is be no less favorable in the form of a merger transaction, each Holder agrees aggregate to vote its Holder’s Shares the Dragged Members than as set forth in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable law.the Initial Offer Notice. The Drag-Along
Appears in 1 contract
Samples: Agreement of Contribution and Sale (Change Healthcare Holdings, Inc.)
Drag Along Right. (i) Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect anything to the maximum number contrary contained herein, at any time (i) if each of Holder’s Shares for which the Actual Controller, Genesis Capital, Tencent, Tiger Fund and Eastern Bell and the Series F Lead Investor (collectively the “Drag Holders”) approves a Trade Sale of the Group Companies, and (ii) provided that (X) the valuation of the Group Companies immediately prior to such Holder Trade Sale is permitted no less than 1.2 times a valuation of the Company representing a per share price equaling to the Deemed Series F Issue Price, in case of any Trade Sale occurring prior to December 31, 2022, or (pursuant Y) the valuation of the Group Companies immediately prior to Section 2(b)(ii)(Bsuch Trade Sale is no less than 1.4 times a valuation of the Company representing a per share price equaling to the Deemed Series F Issue Price, in case of any Trade Sale occurring on or after January 1, 2023 and prior to December 31, 2023, or (Z) above) the valuation of the Group Companies immediately prior to exercise such Tag-Along Right Trade Sale is no less than 2.0 times a valuation of the Company representing a per share price equaling to the Deemed Series F Issue Price, in respect case of any Trade Sale occurring on or after January 1, 2024, then the Drag Holders shall have the right to deliver a Third Party written notice to notify each other Shareholder of the Company of such Trade Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in whereupon each such entity’s sole discretion)Shareholder shall, such Holder shall sell to in accordance with the respective Third Party instructions received from the number of whole Holder’s Shares (rounded upwards or downwardsDrag Holders, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date take each of the Drag-Along Notice actions set forth in clauses (as defined belowa) and (yb) below:
(a) vote all of its Equity Securities of the Third Party Sale PercentageCompany in favor of such Trade Sale;
(b) sell such Shareholder’s pro rata portion of the Equity Securities of the Company, at the same price and on the same terms and conditions and at the sale price as such Selling Fortress Entity has agreed approved by the Drag Holders. Any proceeds received from the Trade Sale shall be distributed among the Shareholders of the Company in accordance with Section 4.6(i). In no event shall the Shareholders’ obligations under this Section 4.7(i) result in violation of any laws and regulations with respect to with such Third Partythe transfer of state-owned assets or any requirements of state-owned assets supervision and administration authorities; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity Shareholders shall use its reasonable, good faith their reasonable efforts to provide that (A) the only representation and warranty which cause such Holder shall Trade Sale to be required to make consummated in connection accordance with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership relevant provisions of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable law.Schedule A.
Appears in 1 contract
Samples: Convertible Note Subscription Agreement (ZKH Group LTD)
Drag Along Right. Notwithstanding (i) If at any time and from time to time after the date of this Agreement, the Majority Holders wish to (i) Transfer in a bona fide arms' length sale all of their Units to any Person or Persons who are not Affiliates of the Company or any of the Majority Holders or (ii) approve any merger of the Company with or into any other provision hereofPerson who is not an Affiliate of the Company or the Majority Holders, if or (iii) approve any Holder has sale of all or substantially all of the Company's assets to any Person or Persons who are not exercised its Tag-Along Right with respect to Affiliates of the maximum number Company or any of Holder’s Shares the Majority Holders (for which such Holder is permitted (pursuant to purposes of this Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion3(d), such Holder Person or Persons shall be referred to as the "Proposed Transferee"), the Majority Holders shall have the right (for purposes of Section 3(d), the "Drag-Along Right") to (x) in the case of a Transfer of the type referred to in clause (i), require each Investor to sell to the respective Third Party Proposed Transferee all Units (including any warrants or options to acquire Units) then Owned by such Investor for the number same per Unit consideration as proposed to be received by the Majority Holders (less, in the case of whole options or warrants, the exercise price for such options or warrants), or (y) in the case of a merger or sale of assets referred to in clauses (ii) or (iii) above, require each other Investor to vote all Units then Owned by such other Investor in favor of such transaction. Each Investor agrees to take all steps necessary to enable him or it to comply with the provisions of this Section 3(d) to facilitate the Majority Holder’s Shares 's exercise of a Drag-Along Right.
(rounded upwards ii) To exercise a Drag-Along Right, the Majority Holders shall give each Investor a written notice (for purposes of this Section 3(d), a "Drag-AIong Notice") containing (1) the name and address of the Proposed Transferee and (2) the proposed purchase price, terms of payment and other material terms and conditions of the Proposed Transferee's offer. Each Investor shall thereafter be obligated to sell its Units (including any warrants or downwardsoptions Owned by such Investor) to the Proposed Transferee or vote its Units in favor of the proposed transaction, as the case may be; provided that the sale to the Proposed Transferee or the merger or sale of assets, as applicable), whether or not the restrictions on Transfer is consummated within ninety (90) days of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date delivery of the Drag-Along Notice (as defined below) and (y) Notice. If the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited sale to the amount of proceeds actually received by Proposed Transferee or the merger or asset sale is not consummated within such Holder in the Third Party Sale; provided further90-day period, that a Holder then each Investor shall not no longer be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless sell such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities Investor's Units or other laws vote (or, if having voted such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares Units in favor of such merger or sale of assets, such Investor may revoke such vote) for such merger or assets sale pursuant to that specific Drag-Along Right but shall remain subject to the provisions of this Section 3(d).
(iii) Notwithstanding anything contained in this Section 3(d), in the event that all or a portion of the purchase price consists of securities and not the sale of such securities to exercise the Investors would require either a registration under the Securities Act or the preparation of a disclosure document pursuant to Regulation D under the Securities Act or a similar provision of any rights state securities law, then, at the option of appraisal or dissent afforded under applicable lawthe Majority Holders, the Investors may receive, in lieu of such securities, the fair market value of such securities in cash, as determined in good faith by the Board.
Appears in 1 contract
Samples: Holders Agreement (Ev3 Inc.)
Drag Along Right. Notwithstanding (a) Prior to a Qualified IPO, (i) So long as Xxxxxxx owns at least 80% of the shares of Common Stock owned by Xxxxxxx as of the date of this Agreement (calculated prior to any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect to the maximum number of Holder’s Shares for which such Holder is permitted (sales pursuant to Section 2(b)(ii)(B4.1(b) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon and treating the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer shares of Common Stock have lapsed, equal Transferred pursuant to the product Xxxxxxx Gift as being owned by Xxxxxxx), if both CCMP and Xxxxxxx propose to Transfer all of their Common Stock, representing more than 50% of the aggregate Voting Securities of the Company, or (xii) if Xxxxxxx does not own at least 80% of the total number shares of Holder’s Shares held by such Holder on Common Stock that Xxxxxxx owns as of the date of this Agreement (calculated prior to any sales pursuant to Section 4.1(b) and treating the shares of Common Stock Transferred pursuant to the Xxxxxxx Gift as being owned by Xxxxxxx), if CCMP (so long as CCMP beneficially owns 5% or more of the Company’s Fully-Diluted Common Stock) by itself or along with any other Holders propose to Transfer all of their Common Stock, representing more than 50% of the aggregate Voting Securities of the Company (the “Drag Transaction”), then if requested by the Holder(s) Transferring such Common Stock (the “Drag-Along Seller(s)”), each other Holder (each, a “Dragged Party”) shall (i) be required to sell all of the Common Stock held by it of the same class or series as any of the Common Stock to be Transferred (or then convertible into any such class or series) in the Drag Transaction, and (ii) vote for, consent to, raise no objections to and take all actions reasonably required, necessary or desirable in connection with, such Drag Transaction.
(b) The consideration to be received by a Dragged Party shall be the same form and amount of consideration per share to be received by the Drag-Along Notice (as defined below) Seller(s), and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions of such sale shall be the same as such Selling Fortress Entity has agreed those upon which the Drag-Along Seller(s) sells its Common Stock. In connection with the Drag Transaction, each Dragged Party will agree to with such Third Partymake or agree to the same customary representations, covenants, indemnities and agreements as the Drag-Along Seller(s) so long as they are made severally and not jointly and the liabilities thereunder are borne on a pro rata basis based on the consideration to be received by each Holder; provided, howeverthat (i) any general indemnity given by the Drag-Along Seller(s), that applicable to liabilities not specific to the Drag-Along Seller(s), to the purchaser in connection with such sale shall be apportioned among the Dragged Parties according to the consideration received by each such Holder Dragged Party and shall not exceed such Dragged Party’s net proceeds from the sale, (ii) that any representation relating specifically to a Dragged Party and/or its Common Stock shall be permitted made only by that Dragged Party, and (iii) in no event shall any Holder be obligated to sell agree to any unvested Holder’s Shares non-competition covenant or other similar agreement as a condition of participating in such Transfer.
(c) The fees and expenses incurred in connection with a sale under this Section 4.5 and for the benefit of all Holders (it being understood that costs incurred by or on behalf of a Holder for his, her or its sole benefit will not be considered to be for the benefit of all Holders), to the extent not paid or reimbursed by the Company or the Transferee or acquiring Person, shall be shared by all the Holders on a pro rata basis, based on the consideration received by each Holder in respect of its Common Stock; provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such no Holder shall be required obligated to make in connection with any out-of-pocket expenditure prior to the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership consummation of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale transaction consummated pursuant to this Section 2(b)(iii4.5 (excluding de minimis expenditures).
(d) unless such Holder is The Drag-Along Seller(s) shall provide written notice (the “Drag-Along Notice”) to each other Dragged Party of any proposed Drag Transaction as soon as practicable following its exercise of the rights provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Section 4.5(a). The Drag-Along Notice shall set forth the consideration to be paid by the purchaser for the securities, the identity of the purchaser and the material terms of the Drag Transaction.
(e) If any holders of Common Stock of any class are given an option as to the form and amount of consideration to be received in the Drag Transaction, all holders of Common Stock of such class shall be given the same option.
(f) Upon the consummation of the Drag Transaction and delivery by any Dragged Party of the duly endorsed certificate or certificates representing the Common Stock held by such Dragged Party to be sold together with a stock power duly executed in blank, the acquiring Person shall remit directly to such Holder shall indemnify such Holder Dragged Party, by wire transfer of immediately available funds, the consideration for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawsecurities sold pursuant thereto.
Appears in 1 contract
Drag Along Right. Notwithstanding (a) If Stockholders acting by Majority Requisite Consent propose to consummate a transaction or series of related transactions constituting a Sale of the Company (the “Dragging Stockholders”) pursuant to an Approved Sale, such Dragging Stockholders shall have the right, at their option to require the other Stockholders (each a “Dragged Stockholder”) to join in such Approved Sale by Transferring the Co-Sale/Drag Sale Percentage of Stockholder Shares proposed to be sold by the Dragging Stockholders, subject to the obligations in Section 2.5(c); provided that Alternative Majority Consent may be obtained if Majority Requisite Consent is not obtained. Each Stockholder shall consent to and raise no objections against (and, in any other provision hereof, if any Holder has not exercised its Tag-Along Right stockholder vote required with the respect to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Approved Sale, thenshall affirmatively vote all of its Stockholder Shares (if any) the Approved Sale, upon and if the demand Approved Sale is structured as a sale of the issued and outstanding equity Securities of the Company (whether by merger, recapitalization, consolidation or Transfer of Stockholder Shares or other Securities or otherwise), then each Dragged Stockholder shall waive any Selling Fortress Entity participating dissenters rights, appraisal rights or similar rights in connection with such Third Party Approved Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as if applicable), whether each Dragged Stockholder shall agree to sell his, her or not the restrictions on Transfer of Common Stock have lapsedits Stockholder Shares, equal subject to the product of (xSection 2.5(c) the total number of Holder’s Shares held by such Holder below, on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as may be approved by the Dragging Stockholders. Each Dragged Stockholder and the Company (subject to applicable law and compliance by the Company Board with any fiduciary duties) shall take all necessary and desirable actions in connection with the consummation of the Approved Sale, including, but not limited to, the execution of such Selling Fortress Entity has agreed agreements and instruments and other actions necessary to provide the representations, warranties, indemnities, covenants, conditions, escrows and other provisions and agreements relating to such Approved Sale. Notwithstanding anything to the contrary contained herein, Sections 2.1, 2.2, 2.4, 2.6 and 2.7 and Articles III and VIII shall not apply in connection with an Approved Sale.
(b) The Dragging Stockholders shall deliver written notice to each Dragged Stockholder setting forth in reasonable detail the material terms (including price, time and form of payment and the identity of the Dragging Stockholders) of any Approved Sale (the “Approved Sale Notice”) at least ten (10) Business Days prior to the consummation of such Third PartyApproved Sale. Within five (5) Business Days following receipt of the Approved Sale Notice, each Dragged Stockholder shall deliver to the Dragging Stockholders written notice (in form and substance reasonably satisfactory to the Dragging Stockholders) setting forth such Dragged Stockholder’s agreement to consent to and raise no objections against, or impediments to, the Approved Sale (including, waiving all dissenter’s and similar rights, if applicable) and if the Approved Sale is structured as a sale of stock, to sell its Stockholder Shares on the terms and conditions set forth in the Approved Sale Notice; provided, however, that each the failure by any Dragged Stockholder to deliver such Holder written notice and/or consent to the Dragging Stockholders shall not be permitted in any manner relieve or otherwise affect the obligations of each Dragged Stockholder pursuant to sell any unvested Holder’s Shares this Section 2.5.
(provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (Ac) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership The obligations of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated Dragged Stockholders to participate in any Third Party Approved Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel 2.5 are subject to the effect satisfaction of the following conditions:
(i) subject to clause (ii) below, upon the consummation of the Approved Sale, each Stockholder shall receive the same proportion of the aggregate consideration from such Approved Sale that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, such holder would have received if such Holder aggregate consideration had been distributed by the Company in complete liquidation pursuant to the rights and preferences set forth in the Certificate as in effect immediately prior to such Approved Sale;
(ii) if any Stockholder is not provided given an option as to the form and amount of consideration to be received with an opinion respect to Securities in a class, all Stockholders of such class will be given the same option;
(iii) no Stockholder shall be obligated to pay more than his, her or its pro-rata amount (based on the amount of aggregate consideration received) of all reasonable expenses incurred by the Company in connection with a consummated Approved Sale;
(iv) any indemnification obligations for breaches of representations, warranties and covenants made by the Company and its Subsidiaries shall be pro-rata among the Stockholders based on the aggregate consideration received with respect to the matters contemplated by this provisoStockholder Shares and capped at such Stockholders’ pro rata share of the aggregate consideration received; and
(v) no Stockholder other than a Management Stockholder shall be required to sign on to any agreement restricting its ability to compete with the Company and its Subsidiaries.
(d) To the extent the Approved Sale is structured as a sale of all or substantially all of the assets of the Company on a consolidated basis, each Selling Fortress Entity who has delivered a Drag-Along Notice Dragged Stockholder shall consent to and raise no objections against (and, in any stockholder vote required with respect to such Holder Approved Sale, shall indemnify such Holder for any such violation. If the Third Party Sale is in the form affirmatively vote all of a merger transaction, each Holder agrees to vote its Holder’s Stockholder Shares in favor of of) such merger transaction and not to exercise shall waive any dissenters rights, appraisal rights of appraisal or dissent afforded under applicable lawsimilar rights in connection with such transaction.
Appears in 1 contract
Samples: Stockholders’ Agreement (Ami Celebrity Publications, LLC)
Drag Along Right. Notwithstanding (a) In the event of an Event of Default under the Restated Note, other than the Specified Default (as defined in the Forbearance Agreement) (each, an “Additional Event of Default”), and Warburg forecloses on certain of the Pledged Collateral, Warburg may, at its option, at any other provision hereof, if any Holder has not exercised its Tagtime and from time to time during the Drag-Along Right with respect Period, require and compel Beams Power and its Affiliates (as defined in the Note Purchase Agreement) (“Affiliates”) to Transfer or cause to be Transferred up to all of the maximum number of Holder’s Shares Common Stock and other securities issued by Synutra for which such Holder is permitted Beams Power and its Affiliates are now, or become, a “beneficial owner” (pursuant to Section 2(b)(ii)(Bas defined in Rule 13d-3 under the Exchange Act), including, without limitation, all Owned Equity Interests (as defined in the Pledge Agreement) above(collectively, the “Securities”) to exercise such Tagany one or more third parties, in any one or more transactions, including public and/or private sales (the “Drag-Along Right in respect Right”).
(b) Warburg shall give Beams Power five (5) days advance written notice of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entityWarburg’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date exercise of the Drag-Along Right (the “Notice”). In the event Warburg exercises the Drag-Along Right, the offer and sale of the Securities (a “Drag-Along Sale”) shall be administered by (i) any one of the following institutions selected by Warburg in its sole and absolute discretion: Moelis & Company (including any of its affiliates), or Xxxxxx Xxxxxxx (including any of its affiliates), or (ii) any other institution agreed to in writing by Beams Power and Warburg (such institution selected in accordance with clauses (i) or (ii), the “Agent”). The Agent shall have full authority, by and on behalf of Beams Power and Warburg, to determine the party or parties to whom the Securities are offered and sold, the price(s) at which the Securities are offered and sold, the timing for the offer and sale of the Securities during the Drag-Along Period pursuant to the Drag-Along Sale, and such other matters, terms and conditions incident to effecting the Drag-Along Sale; provided that unless otherwise agreed to in writing by Beams Power and Warburg, the per share price at which the Securities are sold in the Drag-Along Sale shall not be less than the highest per share purchase price offered for all the Securities in writing by any one or more parties within the 15-day period immediately following the date the Notice is delivered (the “Highest Offer Price”). Beams Power agrees that the terms and conditions in which the Securities are sold in a Drag-Along Sale may be less favorable to Beams Power than if Beams Power sold the Securities in other than a Drag-Along Sale, including, without limitation, pursuant to sales prices that reflect a significant discount to the trading and/or closing prices of the Securities at or prior to the time of such Drag-Along Sale, and that the Agent or Warburg, as applicable, has no obligation to delay sale of any such Securities.
(c) In the event any Securities are sold pursuant to a Drag-Along Sale at a price that exceeds the lesser of (I) U.S.$7.98165, (II) the amount equal to 90% of the Weighted Average Price of the Common Stock for the thirty (30)-Trading Day period ending on November 22, 2011, and (III) the amount equal to 90% of the Weighted Average Price of the Common Stock for the thirty (30)-Trading Day period ending on the most recent Trading Day immediately preceding the date the first definitive agreement for the Drag-Along Sale is executed by the parties thereto (such lesser amount, the “Default Sale Price”), the Remaining Amount shall be paid directly to Warburg by the purchaser(s) of such Securities and such Remaining Amount shall not be applied against, or be deemed to offset or reduce, the Obligation or any Secured Obligation (as defined belowin the Pledge Agreement) and in any respect. For purposes of this Agreement, the “Remaining Amount” means the amount equal to (yY) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that product obtained by multiplying (A) the only representation number of shares of Common Stock underlying the Securities sold in the Drag-Along Sale, by (B) (i) the Highest Offer Price less (ii) the Default Sale Price, less (Z) the Additional Amount (as defined in the Pledge Agreement), if any, paid to Warburg pursuant to the Pledge Agreement; provided that solely for purposes of this Section 3(c), the amount of the Securities deemed sold shall not exceed that number of shares obtained by dividing (1) the Obligation outstanding as of the Maturity Date, by (2) the Default Sale Price, rounded up to the nearest whole share.
(d) During the Drag-Along Period, Beams Power shall provide, and warranty shall exercise its commercially reasonable efforts to cause Synutra to provide, the Agent and any prospective purchaser of the Securities identified by the Agent, subject to such reasonable confidentiality obligations as shall ordinarily be imposed on such parties, with reasonable access to make such investigation of Synutra, Beams Power and the Securities and to conduct such examination of the condition of the foregoing as any prospective purchaser of the Securities deems necessary, advisable or appropriate in order to familiarize itself with the foregoing, including, without limitation, discussions with the officers and other key employees, customers, suppliers, partners and collaborators of Beams Power and Synutra subject to a reasonable written confidentiality agreement.
(e) In the event the Drag-Along Sale requires the approval of Synutra’s stockholders pursuant to any rule or regulation of the SEC, an Eligible Market or otherwise, Beams Power agrees, on behalf of itself and its Affiliates, subject to any obligations Beams Power may have under applicable laws, including, without limitation, any fiduciary duties that Beams Power may owe, by virtue of the size of its stockholding in Synutra, to (i) take all actions necessary to require that, by no later than fifteen (15) days after Beams Power receives the Notice, (Y) Synutra solicit the approval of the Drag-Along Sale by the written consent of Synutra’s stockholders in accordance with all applicable laws, or (Z) if Synutra is prohibited by applicable law from soliciting the written consent of stockholders to approve the Drag-Along Sale, Synutra hold a meeting of stockholders at which the Drag-Along Sale is proposed for approval by Synutra’s stockholders, (ii) vote (in person, by proxy or by action by written consent, as applicable) all Securities in favor of the Drag-Along Sale and in opposition of any and all other proposals that could reasonably be expected to delay, impair or otherwise hinder or impede the Drag-Along Sale; provided that in the event Warburg sells any shares of Common Stock for which Warburg or one of its affiliates is a “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), excluding the Pledged Collateral, in conjunction with the Drag-Along Sale (a “Combined Sale”), Beams Power and Warburg shall share pro rata (based on the number of underlying shares of Common Stock sold in such Holder Combined Sale), (I) in any indemnity liabilities to the purchaser(s) in the Combined Sale (other than representations as to unencumbered ownership of and ability to transfer the shares or other securities deemed to be sold by a stockholder, which shall be the sole responsibility of such stockholder), which indemnification shall be several, and not joint, and shall not exceed the consideration payable to such stockholder in such transaction (except in the case of potential liability for fraud or willful misconduct by the stockholder) and (II) in any escrow for the purposes of satisfying any such indemnity liabilities; and (iii) use its commercially reasonable efforts to procure that the other stockholders of Synutra approve the Drag-Along Sale.
(f) In the event Warburg exercises the Drag-Along Right, Beams Power agrees, on behalf of itself and its Affiliates, to: (i) enter into one or more definitive agreements with each purchaser of the Securities pursuant to such Drag-Along Sale; (ii) execute and deliver all other documents, certificates and instruments deemed necessary by Warburg to effect the Drag-Along Sale; (iii) deliver all stock certificates representing the Securities to be sold in the Drag-Along Sale (duly endorsed, or with stock powers duly endorsed and medallion guaranteed, for transfer, free and clear of any liens or encumbrances, and with any stock transfer tax stamps affixed, accompanied by an executed instruction letter to the Company’s transfer agent with respect to each such stock certificate, in substantially the form of Exhibit E attached hereto) to the party or parties designated in writing to Beams Power by Warburg, and to take all similar steps required to make transfer the Securities in the Drag-Along Sale with respect to any such Securities held in electronic or book-entry form; and (iv) refrain from exercising any dissenters’ rights, rights of appraisal or similar rights under applicable law at any time with respect to such Drag-Along Sale. Beams Power acknowledges that any such definitive agreement(s) may contain representations, warranties and covenants delivered by Beams Power or its Affiliates with respect to Beams Power, its Affiliates, the Securities, Synutra, Synutra’s affiliates, and other matters, including, without limitation, representations, warranties and covenants similar to the representations, warranties and covenants made by Beams Power in the Note Purchase Agreement and the Forbearance Agreement, and that any or all such representations, warranties and covenants may be made by Beams Power severally and not jointly with any other party.
(g) Beams Power shall bear all fees, costs and expenses incurred by itself and other such fees, costs and expenses reasonably incurred on its behalf or in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership sale of the Holder’s Shares Securities pursuant to a Drag-Along Sale.
(h) If Beams Power fails to deliver the certificate or certificates, if any, evidencing the Securities to be sold by it pursuant to the Drag-Along Sale (duly endorsed, or with stock powers duly endorsed and its ability to convey title thereto medallion guaranteed, for transfer, free and clear of liensany liens or encumbrances, encumbrances and adverse claims and (B) with any stock transfer tax stamps affixed, accompanied by an executed instruction letter to the liability of such Holder Company’s transfer agent with respect to each such stock certificate, in substantially the form of Exhibit E attached hereto) to the party or parties designated in writing to Beams Power by Warburg, Warburg may, at its option, in addition to all other remedies Warburg may have, deposit the purchase price for such Securities (subject to setoff or reduction as provided in this Section 3) with any representation national bank or trust company having combined capital, surplus and warranty made undivided profits in connection excess of U.S.$50 million selected by Warburg in its sole discretion (the “Escrow Agent”). Thereafter, upon delivery to Warburg by Beams Power of the certificate or certificates evidencing such Securities (duly endorsed, or with stock powers duly endorsed and medallion guaranteed, for transfer, free and clear of any liens or encumbrances, and with any stock transfer tax stamps affixed, accompanied by an executed instruction letter to the Third Party Sale is Company’s transfer agent with respect to each such stock certificate, in substantially the several liability form of Exhibit E attached hereto), Warburg shall instruct the Escrow Agent to deliver the purchase price for such Securities (without any interest from the date of the closing to the date of such Holder delivery, any such interest to accrue to Warburg) to Beams Power.
(i) Beams Power shall not, and Beams Power shall cause its Affiliates not joint with to, (i) Transfer, (ii) pledge, or (iii) otherwise take any action, or fail to take any action, that would result in the creation or imposition of any lien or encumbrance on, in either case, any Securities, except pursuant to the Pledge Agreement and as permitted under this Agreement. Beams Power shall not, and Beams Power shall cause its Affiliates not to, convert any Securities from certificated form to electronic or book entry form without the prior written consent of Warburg.
(j) Notwithstanding anything contained in this Section 3, there shall be no liability on the part of Warburg or the Agent to Beams Power or any other person) and that such liability is limited to Person if the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Drag-Along Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale 3 is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect consummated for any reason. Whether to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered effect a Drag-Along Notice Sale pursuant to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale this Section 3 is in the form sole and absolute discretion of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawWarburg.
Appears in 1 contract
Samples: Drag Along Agreement
Drag Along Right. Notwithstanding (a) Subject at all times to the provisions of Section 6.4 relating to Rights of First Refusal, in the event that the holders representing at least thirty five percent (35%) of the then-outstanding Units (the “Control Group”) wish, where a transfer is otherwise permitted in this Agreement (and for the avoidance of doubt, not prior to the fifth (5th) anniversary hereof), to Transfer in a bona fide arm’s length sale all of the Units then owned by them to any Person who is not an Affiliate of any member of the Control Group (the “Proposed Transferee”), the Control Group shall have the right (the “Drag Along Right”) to require all of the other provision hereofUnitholders to sell to the Proposed Transferee all, if and not part only, of the Units then owned by such Unitholders for the same per share consideration to be received by the Control Group (such transaction referred to in this Agreement as a “Drag Along Sale”); provided, however, that the provisions of this Section 6.6 shall not be available to any Holder Party hereto to the extent such Party has failed to timely fund a required capital call made by the Board of Managers of the Company (subject to the Minority Protection Rights) and such funding failure shall not exercised its Tag-Along Right have been cured by the defaulting Party under the terms of the Agreement.
(b) Each Unitholder agrees with respect to the maximum number of Holder’s Shares for all Units that he/she/it holds and any other Company securities over which such Holder Unitholder otherwise exercises dispositive power:
(i) in the event such transaction requires the approval of Unitholders, if the matter is permitted (pursuant to Section 2(b)(ii)(B) above) be brought to exercise a vote at a Unitholder meeting, to be present, in person or by proxy, as a holder of Units, at all such Tag-Along Right in respect meetings and be counted for the purposes of determining the presence of a Third Party Sale, then, upon the demand quorum at such meetings; and to vote or cause to be voted all Units in favor of such Drag Along Sale and in opposition of any Selling Fortress Entity participating and all other proposals that could reasonably be expected to delay or impair the ability of the Company to consummate such Drag Along Sale;
(ii) in such Third Party the event that the Drag Along Sale (in is to be effected by the sale of Units held by the Control Group without the need for Unitholder approval, each such entity’s sole discretion), such Holder shall Unitholder agrees to sell to all Units of the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares Company held by such Holder on Unitholder to the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale PercentageProposed Transferee, at for the same price per-Unit consideration and on the same terms and conditions as such Selling Fortress Entity has agreed the Control Group;
(iii) to with such Third Party; provided, however, that each such Holder shall not be permitted to sell refrain from exercising any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting dissenters’ rights or rights of appraisal under applicable law at any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty time with respect to such Holder’s own ownership Drag Along Sale, provided it is conducted in accordance with this Section 6.6; and
(iv) to execute and deliver all related documentation and take such other action in support of the Holder’s Shares Drag Along Sale as shall be reasonably requested by the Company or the Control Group.
(c) If a Party to be sold by it this Agreement fails or refuses to vote or sell his, her or its Units as required by, or votes his, her or its Units in contravention of this Section 6.6, then such Party hereby grants to the Chairman and Secretary of the Company an irrevocable proxy coupled with an interest to vote such Units in accordance with this Section 6.6, and hereby appoints the Chairman and Secretary and each of them acting singly, as his, her or its ability attorney in fact, to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of sell such Holder with respect to any representation and warranty made Units in connection accordance with the Third Party Sale is the several liability terms of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable law6.6.
Appears in 1 contract
Drag Along Right. (a) Notwithstanding any other provision hereofanything to the contrary contained in this Agreement, so long as Vistra Member together with its Affiliates holds a Percentage Interest of at least fifty percent (50%), if any Holder has not exercised Vistra Member and its TagAffiliates (the “Dragging Member”) propose to Dispose of greater than 50% of the Units then owned by Vistra Member and its Affiliates to a Person (other than an Affiliate of Vistra Member) (whether such Disposition is by way of purchase, exchange, merger, other form of transaction or a Sale of the Company, a “Drag-Along Right with respect to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party SaleTransaction”), then, upon request of the demand Dragging Member, the Managing Member (the “Drag-Along Notifying Party”) shall notify each other Member (each, a “Drag-Along Member”) in writing at least ten (10) days prior to the consummation of the Drag-Along Transaction. Such notice shall identify the proposed purchaser, the number and type of Units to be sold (if applicable), the consideration offered and any other material terms and conditions of the Drag-Along Transaction, in each case, to the extent then-known. If the Drag-Along Notifying Party delivers such notice: (i) each Drag-Along Member shall sell the Applicable Drag Percentage of the Units held by such Drag-Along Member (provided, that, if the Drag-Along Transaction constitutes a Sale of the Company, then each Class B Member shall sell all of its Class B Units), (ii) each Drag-Along Member shall be deemed to approve the proposed Drag-Along Transaction, (iii) to the extent any vote or consent to such Drag-Along Transaction is required, each Drag-Along Member shall vote for and consent to such Drag-Along Transaction (including on behalf of all of its Units and on behalf of all Units with respect to which such Drag-Along Member has the power to direct the voting) and shall waive any dissenters’ rights, appraisal rights or similar rights which such Drag-Along Member may have in connection therewith, (iv) no Drag-Along Member shall raise any objections to the proposed Drag-Along Transaction, (v) subject to clause (vi) below, each Drag-Along Member shall execute all documents reasonably required to effectuate such Drag-Along Transaction, as determined by the Drag-Along Notifying Party, and (vi) each Drag-Along Member shall be obligated to provide (A) representations and warranties as are customary for transactions of the type, provided that no Drag-Along Member shall be required to make representations and warranties in connection with such Drag-Along Transaction other than customary representations and warranties with respect to (I) such Drag-Along Member’s due organization, power and authority, (II) such Drag-Along Member’s ownership of its Units and ability to freely Dispose such Units without Encumbrances (other than by reason of this Agreement), (III) non-contravention of such Drag-Along Member’s charter, bylaws or other organizational documents and non-contravention of Laws or judgments and (IV) the enforceable nature of such Drag-Along Member’s obligations under the documents for such sale to which it is a party, subject to customary exceptions (collectively, the “Member Representations”), to the extent such Member Representations shall also be made by other Drag-Along Members and the Dragging Member, and (B) covenants as are customary for transactions of the type (but not any non-competition, non-solicitation, or similar restrictive covenants other than customary confidentiality covenants). To the extent indemnification is required of the Drag-Along Members in connection with a Drag-Along Transaction, no Drag-Along Member will be required to be liable in respect of any Selling Fortress Entity indemnification provided in connection with such Drag-Along Transaction (w) for any amount in excess of (I) such Drag-Along Member’s pro rata share (based upon the relative aggregate amounts of consideration received by such Drag-Along Member as compared to the aggregate amounts received by all Members participating in such Third Party Sale Drag-Along Transaction) of such indemnified amount, or (II) the consideration received by such Drag-Along Member in each such entityDrag-Along Transaction, (x) for the breach of any other Drag-Along Member’s sole discretionMember Representations, (y) for the breach of the Dragging Member’s Member Representations (or pursuant to an escrow for representations and warranties of the Company), such Holder shall sell or (z) other than on a several (and not a joint and several) basis with other Drag-Along Members and Vistra Member. Subject to the respective Third Party the number of whole Holder’s Shares (rounded upwards foregoing, each Drag-Along Member shall take all other actions reasonably necessary or downwardsdesirable, as applicabledetermined by the Drag-Along Notifying Party, to cause the consummation of the Drag-Along Transaction on the terms proposed by the Drag-Along Notifying Party.
(b) Upon the consummation of the Drag-Along Transaction, each Drag-Along Member shall receive, with respect to each Unit Disposed of by it in such Drag-Along Transaction, the same form (or the same choice of form) and amount of per Unit consideration as each other Member participating in such Drag-Along Transaction (less any applicable taxes or withholding obligations). The total consideration payable to the Members in connection with a Drag-Along Transaction shall be allocated among the Members in accordance with Section 5.01 and, for this purpose, such total consideration will be computed based upon the sum of (i) the cash included in such consideration, plus (ii) the Fair Market Value of any non-cash property included in such consideration; provided that, notwithstanding anything to the contrary herein, the Managing Member, at the direction of the Drag-Along Notifying Party, may elect to make any such distribution of non-cash property subject to restrictions (including the use of escrow accounts, lock-ups, or other contractual restrictions on the beneficial rights in respect of such shares or other equity interests) so long as such restrictions do not adversely affect the intended economic rights, preferences, privileges, or powers of the Members in respect of their Units.
(c) If a Drag-Along Transaction is consummated, then each Drag-Along Member shall bear a pro rata share (based upon the relative aggregate amounts of consideration received by such Drag-Along Member as compared to the aggregate amounts received by all Members participating in such Drag-Along Transaction) of all costs of the Drag-Along Transaction to the extent such costs are not otherwise paid by the Company or the acquiring party. The fees, costs, and expenses (including legal and expert fees and expenses) incurred by the Drag-Along Notifying Party and its Affiliates in connection with the consummation of a Drag-Along Transaction shall be deemed to be for the benefit of all Members for purposes of this Section 7.03(c), whether or not the restrictions on Transfer Drag-Along Transaction is consummated; provided, that, if the Drag-Along Transaction is consummated, in no event shall any such Drag-Along Member’s pro rata share of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date costs of the Drag-Along Notice (as defined below) and (y) Transaction exceed the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder Drag-Along Member in the Third Party Sale; provided further, that Drag-Along Transaction. Costs incurred by any Drag-Along Member in connection with a Holder Drag-Along Transaction shall not be obligated to participate in any Third Party Sale considered costs of the Drag-Along Transaction hereunder and shall be the sole responsibility of such Drag-Along Member.
(d) In connection with a Drag-Along Transaction pursuant to this Section 2(b)(iii7.03:
(i) unless such Holder is provided an opinion of counsel if requested by the Drag-Along Notifying Party, the Company will promptly engage, on customary terms (including customary indemnification from the Company), a nationally recognized investment banking firm selected by the Managing Member to provide financial advisory services to the effect Company, and the Company shall pay the fees and expenses of such investment banking firm; and
(ii) the Company and the Members will cooperate in the obtaining of all Governmental Authorizations and third-party approvals and consents (including clearances and expirations of waiting periods) reasonably necessary to consummate, and will use their respective commercially reasonable efforts to satisfy any conditions to the consummation of, a Drag-Along Transaction under this Section 7.03; provided, that in no circumstance shall anything contained in this Agreement be deemed to require any Member to (i) pay any money to any Governmental Authority or other Person with respect to obtaining such Governmental Authorizations or third party approvals or consents (other than de minimis filing fees or similar costs) or (ii) agree to undertake any action or to provide any efforts with respect to obtaining any Governmental Authorization or other third-party approvals, consents or clearances that includes an obligation to litigate with any Governmental Authority or other body or to divest or hold separate any assets or investments of such Member or its Affiliates or the Third Party Sale Company or its Subsidiaries or to take any other mitigating action that could negatively affect the reputation or other assets or investments of such Member or its Affiliates or the Company or its Subsidiaries.
(e) If the Drag-Along Transaction is not consummated within twelve (12) months from the delivery of the notice of Drag-Along Transaction pursuant to Section 7.03(a), then the Drag-Along Notifying Party must again comply with the notice and other requirements of this Section 7.03 in violation connection with any proposed Drag-Along Transaction; provided, that, if the consummation of such sale is subject to the receipt of any Governmental Authorizations and such Governmental Authorizations have not been received by the end of such twelve (12) month period, such twelve (12) month period shall automatically be extended for an additional thirty (30) days following receipt of such Governmental Authorizations.
(f) Notwithstanding anything contained in this Section 7.03, there shall be no liability on the part of the Drag-Along Notifying Party to the other Members (other than the obligation to return the limited power of attorney and the certificates, if any, and other applicable federal instruments representing Units received by the Drag-Along Notifying Party) or any other Person if the Drag-Along Transaction pursuant to this Section 7.03 is not consummated for whatever reason, regardless of whether the Drag-Along Notifying Party has delivered a notice of a Drag-Along Transaction pursuant to Section 7.03(a). The decision regarding whether to effect a Drag-Along Transaction pursuant to this Section 7.03 by the Drag-Along Notifying Party shall be in the sole and state securities absolute discretion of the Drag-Along Notifying Party.
(g) With respect to a Drag-Along Transaction, each Member irrevocably constitutes and appoints a designee of the Dragging Member, with full power of substitution and resubstitution, as its true and lawful attorney in fact and agent with full power and authority in its name, place and stead to execute, acknowledge, verify, deliver, swear to, file and record at the appropriate public offices such documents as the Dragging Member deems necessary to carry out (to the extent consistent with the terms hereof) the provisions of this Section 7.03, including all consents, agreements and other instruments necessary to reflect or give effect to the provisions of this Section 7.03. The appointment by all Members of a designee of the Dragging Member, as attorney-in-fact, in each case to the extent set forth in the foregoing sentences of this Section 7.03(g), shall be deemed to be a power coupled with an interest, in recognition of the fact that each of the Members under this Agreement will be relying upon the power of a designee of the Dragging Member, to act as contemplated by this Section 7.03 in any filing and other action by it on behalf of the Company, shall survive the incapacity of any Person hereby giving such power, and the Disposition of all or any portion of the Units of such Person in the Company, and shall not be affected by the subsequent incapacity of such Person; provided that in the event of the Disposition by a Member of all of its Units in the Company, the foregoing power of attorney of a Disposing Member shall survive such Disposition and shall apply with respect to such Assignee upon such Assignee being admitted as a New Member pursuant to this Agreement. This power of attorney may be exercised by such attorney-in-fact for all Members (or any of them) by a single signature of a designee of the Dragging Member, acting as attorney-in-fact with or without listing all of the Members executing an instrument. Any Person dealing with the Company may conclusively presume and rely upon the fact that any instrument referred to above, executed by any holder of this power of attorney, is authorized, legal, valid and binding, without further inquiry. If required, each Member shall execute and deliver to a designee of the Dragging Member, within five (5) days after the receipt of a request therefor, such further designations, powers of attorney or other laws orinstruments as a designee of the Dragging Member, if such Holder is not provided with an opinion shall reasonably deem necessary for the purposes hereof. The Dragging Member shall keep the Class B Member Representative reasonably informed with respect to the status of all material matters contemplated handled by the Dragging Member under this proviso, each Selling Fortress Entity who has delivered Section 7.03(g) as reasonably requested by the Class B Member Representative.
(h) The Drag-Along Notifying Party shall not be entitled to consummate a Drag-Along Notice Transaction pursuant to this Section 7.03 unless the gross consideration allocable to the Rollover Members in connection with such Holder Drag-Along Transaction in respect of their Class B Units is equal to or exceeds the Fair Market Value of the Class B Units held by the Rollover Members.
(i) The provisions of this Section 7.03 shall indemnify such Holder for any such violation. If terminate upon the Third Party Sale is earlier of (i) immediately prior to the effectiveness of the registration statement in the form of connection with a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger Qualified IPO and not to exercise any rights of appraisal or dissent afforded under applicable law(ii) a Class B Liquidity Event.
Appears in 1 contract
Drag Along Right. Notwithstanding any other provision hereofIn the event that you become a Participating Stockholder Seller pursuant to Section 4.5 of the Stockholders Agreement, if any Holder has all Shares issuable in respect of vested “in the money” Options held by you whether or not exercised its Tag-Along Right (including any Options that would vest as a result of the consummation of the Change of Control Transaction described in Section 4.5 of the Stockholders Agreement) shall constitute Shares held by you for purposes of the calculation set forth in the first sentence of Section 4.5(a) of the Stockholders Agreement (provided, notwithstanding anything to the contrary in Section 4.5 of the Stockholders Agreement, you shall be required to exercise only the applicable “in the money” Options with respect to such Shares in accordance therewith). In the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of event that (x) the total number of Holder’s consideration payable for Shares held by such Holder on the date to be sold pursuant to Section 4.5 of the Drag-Along Notice (as defined below) Stockholders Agreement includes securities and (y) applicable law would require the Third Party Sale Percentageprovision to you, at in your capacity as a Participating Stockholder Seller or Drag-Along Seller, as applicable, of any specified information regarding the same price and on Company or any of its parents or subsidiaries, such securities or the same terms and conditions issuer thereof that is not otherwise required to be provided for such Transfer pursuant to Section 4.5 of the Stockholders Agreement, then notwithstanding Section 4.5(f) of the Stockholders Agreement, you, in your capacity as a Participating Stockholder Seller or Drag-Along Seller, as applicable, shall have the right to sell Shares in such Selling Fortress Entity has agreed proposed Transfer pursuant to with such Third PartySection 4.5 of the Stockholders Agreement; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company maySponsor Investor Sellers shall have the right, but not the obligation, to cause to be paid to you, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered your capacity as a Drag-Along Notice to Seller, in lieu of such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is securities described in the form of a merger transactionpreceding sentence, each Holder agrees an amount in cash equal to vote its Holder’s Shares in favor the Fair Market Value of such merger Shares as of the date such securities otherwise would have been issued in exchange for such Shares. The Drag-Along Right of the Sponsors shall terminate upon the earlier to occur of (i) an IPO and (ii) a Liquidity Event. The Drag-Along Right of the Sponsors shall not include a right to exercise require you to sign a non-compete agreement (it being understood that any rights existing non-compete agreement then in effect between you and the Company or one of appraisal its parents or dissent afforded under subsidiaries shall not terminate solely as a result of such Transfer). Any unvested or “out-of-the money” vested Options shall be treated in accordance with the applicable lawaward agreement.
Appears in 1 contract
Samples: Stockholders Agreement (PPD, Inc.)
Drag Along Right. Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect (a) Subject to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not and without limiting the restrictions on Transfer of Common Stock have lapseddescribed in Section 6.04, equal and only to the product extent Buyer has not exercised (or is deemed to have waived its right to exercise) its tag-along rights pursuant to Section 6.05, if Seller desires or intends to sell, assign, Transfer or otherwise convey, directly or indirectly, all (but not less than all) of its interest in the Joint Assets, to a Third Party (xwhether through a marketed sales process, pursuant to a negotiated offer or otherwise), then Seller shall be entitled to exercise drag-along rights to require Buyer to participate in such Transfer for all (but not less than all) of Buyer’s interest in the total number of Holder’s Shares held by such Holder on Joint Assets (the date of “Dragged Interest”) as provided in this Section 6.06 (and expressly subject to the limitations in Section 6.06(c)) (a “Drag-Along Notice Sale”). If Seller intends to proceed with a Drag-Along Sale, Seller may exercise its drag-along rights by delivering to Buyer a written notice (as defined belowa “Drag Notice”) which shall (i) identify the proposed Third Party transferee, (ii) include such Third Party transferee’s bona fide allocation of value among Seller’s and Buyer’s respective interest in the Joint Assets, (iii) specify the anticipated date on which such proposed sale shall take place, and (yiv) describe the Third material terms and conditions of the proposed sale (including, without limitation, the offer price; allocation of liabilities; indemnification thresholds and deductibles; and descriptions of the representations, warranties, defect mechanisms and termination rights). Seller will use commercially reasonable efforts to cause the proposed transferee to propose a purchase price that includes Seller’s and Buyer’s respective interest in the Joint Assets described in the Drag Notice and a bona fide allocation of value between the Seller’s and Buyer’s respective interest, on the one hand, and all other assets of Seller (if any) included in the transaction subject to a Drag Notice, on the other hand. Neither Party Sale Percentageshall intentionally interfere with such bona fide allocation.
(b) Subject to Section 6.06(c), at if Seller exercises its drag-along rights described in this Section 6.06 consummates a Drag-Along Sale, then (i) Buyer shall be required to Transfer all (but not less than all) of the same price and Dragged Interest on substantially the same terms and conditions as such Selling Fortress Entity has agreed to with between Buyer and such Third Party transferee, with the exception that any representations and warranties relating specifically to any Party shall be made only by that Party, and any indemnification provided by the Parties in the sale shall be made on a several, and not joint, basis; provided(ii) Seller and Buyer shall enter into separate but substantially similar purchase and sale agreements with the purchaser with respect to such Drag-Along Sale to the extent (and only to the extent) the terms of such agreements do not materially burden, however, that each restrict or limit any current acquisitions or divestitures with respect to the Dragged Interest; and (iii) as consideration for such Holder Dragged Interests Seller shall not be permitted entitled to sell any unvested Holder’s Shares (provided that receive the Company may, in its sole discretion, accelerate the vesting greater of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with applicable Repurchase Price for the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and Dragged Interest or (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party transferee’s bona fide allocation of value to the Dragged Interests, as specified in the Drag Notice.
(c) Notwithstanding anything herein to the contrary, Seller will not have the right to exercise its drag-along rights under this Section 6.06 if the compensation for the Dragged Interest paid to Buyer would be less than the applicable Repurchase Price that would be owing to Buyer for the Dragged Interest under Section 6.03 as of the date the Drag-Along Sale is consummated; provided that:
(i) for purposes of this Section 6.06(c), the several liability Repurchase Price attributable to Xxxxx other than the Commitment Xxxxx Drilled, Equipped and Completed on the Leases and the lands pooled or unitized therewith after the Repurchase Period will be deemed to be the greater of such Holder (and not joint the amount calculated in accordance with any other personSection 6.03(b)(ii) and that the value allocated to Buyer’s interest in such liability is limited Xxxxx by the applicable Third Party transferee; and
(ii) Seller shall have the right (but not the obligation) to pay Buyer directly (in immediately available funds) the amount of proceeds actually received any difference between the applicable Repurchase Price (as modified under Section 6.06(c)(i) above) and the purchase price paid to Buyer by such Holder in the applicable Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iiitransferee.
(d) unless such Holder is provided an opinion of counsel Notwithstanding anything to the effect that contrary herein, Seller shall have no liability to Buyer if the Third Party Drag-Along Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder consummated for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawreason.
Appears in 1 contract
Drag Along Right. Notwithstanding any other provision hereof
(a) Prior to the consummation of an Initial Public Offering, if a Member or group of Members elects to Transfer Membership Interests representing a majority or more of the then outstanding Membership Interests of the Company (on a fully diluted basis and excluding, for purposes of this calculation, Incentive Interests) (such Member or group of Members, the “Selling Members”) to a Third Party Purchaser or group of Third Party Purchasers (other than an Affiliate of any Holder has not exercised its Tagsuch Selling Member) (a “Drag-Along Right Sale”), then such Selling Members shall have the right, in lieu of complying with the provisions of Sections 9.3, 9.4, and 9.6, to require the other Members to sell all of their Membership Interests to such Third Party Purchaser in connection with such Drag-Along Sale and otherwise on the same terms as such Selling Members selling such Membership Interests. Such right shall be exercisable by written notice (a “Buyout Notice”) given to each Member other than the Selling Members which shall state (i) that such Selling Members propose to effect the sale of all of the Membership Interests of every Member of the Company to such Third Party Purchaser, (ii) the name of the Third Party Purchaser, and (iii) the purchase price the Third Party Purchaser is paying for the Membership Interests and which attaches a copy of any definitive agreements between such Selling Members and the other parties to such transaction. Each such Member agrees that, upon receipt of a Buyout Notice, such Member shall be obligated to sell all of its Membership Interests for the purchase price set forth in the Buyout Notice and upon the other terms and conditions of such transaction (and otherwise take all reasonably necessary action to cause consummation of the proposed transaction, including voting such Membership Interests in favor of such transaction).
(b) If (i) the Board of Managers approves any transaction that would result in a Change of Control of the Company and (ii) Members holding a majority of the outstanding Membership Interests of the Company (on a fully diluted basis and excluding, for purposes for this calculation, Incentive Interests) approve of such transaction ((i) and (ii) together, an “Approved Sale”), then so long as distributions of consideration to the Members are made in accordance with the provisions of Section 3.4, each Member agrees to include its Membership Interests (pro rata based on the Membership Interests to be sold over the aggregate outstanding Membership Interests) in such approved transaction and vote in favor thereof and will use its best efforts to cooperate in the Approved Sale and will take all necessary and desirable actions in connection with the consummation of the Approved Sale as are reasonably requested by the Board of Managers, including by waiving any appraisal or similar rights with respect to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of Approved Sale and executing any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held action by such Holder on the date written consent of the Drag-Along Notice Members.
(as defined belowc) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder The closing with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Drag-Along Sale pursuant to this Section 2(b)(iii9.5 shall be held as soon as practicable and at the time and place specified in the Buyout Notice but in any event within nine (9) unless such Holder months of the date the Buyout Notice is provided an opinion of counsel delivered to the effect that Members (the “Drag- Along Outside Date”). Consummation of the Transfer of Membership Interests by any Member to the Third Party Purchaser in a Drag-Along Sale is not in violation (i) shall be conditioned upon consummation of applicable federal the Transfer by each Selling Member to such Third Party Purchaser of the Membership Interests proposed to be Transferred by the Selling Members and state securities (ii) may be effected by a Transfer of the Membership Interests or the merger, consolidation or other laws orcombination of the Company with or into the Third Party Purchaser or its Affiliate, if such Holder is not provided with an opinion in one or a series of related transactions. If the proposed Transfer with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a applicable Membership Interests subject to the Buyout Notice does not meet the requirements of Section 9.5(a) prior to the Drag-Along Notice Outside Date, such Selling Members shall be deemed to have forfeited their rights to require the other Members to sell all of their Membership Interests to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is Purchaser in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of connection with such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawDrag-Along Sale.
Appears in 1 contract
Samples: Limited Liability Company Agreement
Drag Along Right. Notwithstanding any other provision hereofSubject to the prior approval of the Management Committee, if at any Holder has not exercised its Tag-Along Right with respect time prior to the maximum number Company first becoming a Public Company, the Majority Members (the "SELLING MEMBER") desire to sell all or any portion of Holder’s Shares for which such Holder is permitted (Selling Member's Interest pursuant to Section 2(b)(ii)(B) abovea bona fide offer from a third party which is not an Affiliate of such Selling Member (a "THIRD PARTY PURCHASER") to exercise purchase all or any portion of its Interests then such Tag-Along Right in respect Selling Member shall have the right to require all of the other Members to sell a Third Party Sale, then, upon the demand pro rata portion of any Selling Fortress Entity participating in their Interests to such Third Party Sale Purchaser in connection with such sale. Such right shall be exercisable by written notice (in a "BUYOUT NOTICE") given to each Member which shall state (i) that the Selling Member proposes to effect the sale of the PRO RATA portion of the Interests of every Member of the Company to such Third Party Purchaser, (ii) the proposed purchase price per unit to be paid by the Third Party Purchaser for the Interests of all of the Members, and (iii) the name of the Third Party Purchaser, and to which shall be attached a copy of all writings between such Selling Member and the other parties to such transaction necessary to establish the terms of such transaction. Each such Member agrees that, upon receipt of a Buyout Notice, each such entity’s sole discretionMember shall be obligated to sell a PRO RATA portion of its Interests upon the other terms and conditions of such transaction (and otherwise take all reasonably necessary action to cause consummation of the proposed transaction, including voting such Interest in favor of such transaction); PROVIDED, HOWEVER, that each such Holder Member shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, only be obligated as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of provided above in this Section 9.3 if (x) each Member receives the total number of Holder’s Shares held by such Holder on same pro rata consideration as the date Selling Member for Interests of the Drag-Along Notice (same class and series as defined below) the Interests to be sold by the Selling Member, and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder Purchaser shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited have furnished evidence reasonably satisfactory to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel Management Committee to the effect that it has the Third Party Sale is not in violation financial ability to consummate the proposed purchase of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If Interests of all of the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawMembers.
Appears in 1 contract
Samples: Limited Liability Company Agreement (Grove Investors Capital Inc)
Drag Along Right. Notwithstanding (a) If BRS Majority Holders approve a sale of all or substantially all of the Company's assets determined on a consolidated basis or a sale of 85% or more (measured by fair market value) of the aggregate equity interests of the Company at the time owned by the BRS Investors (in either case, whether by merger, recapitalization, consolidation, reorganization, combination or otherwise) or any other provision hereoftransaction which has the same effect as any of the foregoing, if any Holder has not exercised its Tag-Along Right with respect to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a an Independent Third Party Sale, then, upon or group of Independent Third Parties in a transaction in which (a) more than 50% of the demand aggregate equity interests of any Selling Fortress Entity participating the Company (on a fully diluted basis) are to be transferred and (b) all Holders of the same class or series of LLC Interests that are being Transferred in such Third Party Sale transaction are treated identically except as provided below in this Section 3 (in each such entity’s sole discretionsale or transaction, an "APPROVED COMPANY SALE"), such then each LLC Interests Holder will vote for, consent to and raise no objections against the Approved Company Sale or the process. If the Approved Company Sale is structured as a merger or consolidation, then each LLC Interests Holder shall sell to waive any dissenters rights, appraisal rights or similar rights in connection with such merger or consolidation. If the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, Approved Company Sale is structured as applicable), whether or not the restrictions on a Transfer of Common Stock have lapsedLLC Interests, equal then each LLC Interests Holder shall agree to the product sell all, but not less than all, of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) his or its LLC Interests and (y) the Third Party Sale Percentage, at the same price and rights to acquire LLC Interests on the same terms and conditions conditions, as such Selling Fortress Entity has applicable to the respective types of LLC Interests to be Transferred by the BRS Majority Holders, it being agreed to with such Third Party; provided, however, that such terms and conditions will not include the making of any representations and warranties, indemnities or other similar agreements other than representations and warranties with respect to title of the units or shares, as applicable, being sold and authority to sell such units or shares, as applicable, absence of conflicts with applicable law or material agreements of the transferor and indemnities related thereto. Subject to the foregoing, each such LLC Interests Holder shall not be permitted to sell any unvested Holder’s Shares (provided that take all necessary or desirable actions in connection with the consummation of an Approved Company maySale as requested by the Board, in its sole discretionincluding, accelerate without limitation, executing the vesting applicable documents of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonabletransfer. Notwithstanding the foregoing, good faith efforts to provide that (A) the only representation and warranty which such no LLC Interests Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party an Approved Company Sale pursuant to this Section 2(b)(iii) unless such Holder holder is provided an a reasonably acceptable opinion of counsel to the effect that the Third Party transfer in connection with such Approved Company Sale is not in violation of the registration or qualification requirements of the federal or applicable federal and state securities or other laws laws, or, if such Holder holder is not provided with such an opinion with respect to opinion, the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall Company will indemnify such Holder holder for any such violation. If .
(b) Each LLC Interests Holder will bear its own costs incurred in connection with any Approved Company Sale.
(c) The provisions of this Section 3 shall terminate upon the Third Party Sale is in the form consummation of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawQualifying Public Offering.
Appears in 1 contract
Drag Along Right. Notwithstanding At any other provision hereoftime following the Company having achieved all of the Milestones, if any Holder has not exercised its Tag-Along Right with respect and subject to the maximum number other provisions of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwardsthis Article VI, as applicable), whether or not the restrictions on if SS&C Health desires to Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date at least [***] of the Membership Interests in the Company to any Proposed Purchaser in a transaction or a series of related transactions pursuant to which each other Founding Member shall have the right, if it so elects, to Transfer up to [***] of its Membership Interests in connection therewith (a “Drag-Along Notice Sale”), SS&C Health shall have the right and option, but not the obligation, to require the other Members to participate in such Drag-Along Sale (as defined below) and (y) the Third Party Sale Percentage“Drag-Along Right”), at the same price (which shall take into account all consideration proposed to be paid by the Proposed Purchaser or its Affiliates to SS&C Health in such Drag-Along Sale) and on the same terms and subject to the same conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice Sale proposed by SS&C Health or its Affiliates (which such terms and conditions shall not (i) restrict the current or prospective business ACTIVE/107611452.20 or operations of either Humana or Anthem or their respective Affiliates or (ii) require either Humana or Anthem or their respective Affiliates to agree to a non-competition, non-solicitation, no-hire or other restrictive covenant (other than as may be provided for in this Agreement and any other agreement in place between the Company and a Member from time to time)), by selling the desired Percentage Interest(s) (including the Membership Interest(s) represented thereby) held by such Holder other Founding Member(s), which, in each case, shall indemnify be no less than such Holder for any such violation. If other Founding Member’s Percentage Interest multiplied by a fraction (x) the Third Party Sale numerator of which is the Percentage Interest included in the form Membership Interests being Transferred by SS&C Health and (y) the denominator of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor which is the total Percentage Interest held by SS&C Health at the time of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawDrag-Along Sale (such amount, the “Drag-Along Share”).
Appears in 1 contract
Samples: Limited Liability Company Agreement (SS&C Technologies Holdings Inc)
Drag Along Right. Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect (a) If the Majority Member proposes to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right sell in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such bona fide arm's length Permitted Third Party Sale or an Alternative Member Offer Sale all Interests collectively owned by it and its Affiliates (the "TRANSFERRING MEMBER") to any Person or Persons who are not Affiliates of the Majority Member and in each such entity’s sole discretionwhich the Majority Member does not have a five percent (5%) or greater equity interest (the "PROPOSED TRANSFEREE"), the Transferring Member shall have the right (the "DRAG ALONG RIGHT"), subject to applicable law and compliance with any other restrictions applicable to such Holder shall transfer, to require all Members to sell all Interests then held by the other Members to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwardsProposed Transferee, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as are applicable to the Transferring Member.
(b) The Drag Along Right may be exercised only after January 6, 2004, and if prior to the Expiration Date, only with the written consent of a majority of the Voting Interests not held by the Majority Member.
(c) To exercise a Drag Along Right, the Transferring Member shall give each Member (each, a "DRAG ALONG MEMBER"), at least fifteen (15) days prior to the proposed transfer to the Proposed Transferee, a written notice (the "DRAG ALONG NOTICE") containing (i) the name and address of the Proposed Transferee and (ii) the proposed purchase price, the terms of payment and other material terms and conditions of the Proposed Transferee's offer. Each Drag Along Member shall thereafter be obligated to (i) sell to the Proposed Transferee all Interests owned by such Selling Fortress Entity has agreed Drag Along Member and (ii) enter into a purchase agreement on the same economic terms and substantially similar in form and substance to with such Third Partythe purchase agreement the Transferring Member executes; provided, however, that in no event shall the purchase agreement provide for an indemnity payable by a Drag Along Member greater than the proceeds received by that Drag Along Member from the Proposed Transferee. If the sale is not consummated within a period of one hundred twenty (120) days following the date of the Drag Along Notice, then each such Holder Drag Along Member shall not no longer be permitted obligated to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect Member's Interests pursuant to such Holder’s own ownership Drag Along Right but shall remain subject to the provisions of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder this SECTION 7.4 with respect to any representation and warranty made subsequent proposed transfer described in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawSECTION 7.4.
Appears in 1 contract
Samples: Operating Agreement (Autobytel Inc)
Drag Along Right. Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect to In the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect event the holders of a Third Party Salemajority of the Company’s equity securities then outstanding (the “Majority Shareholders”) determine to sell or otherwise dispose of all or substantially all of the assets of the Company or all or fifty percent (50%) or more of the capital stock of the Company in each case in a transaction constituting a change in control of the Company, thento any non-Affiliate(s) of the Company or any of the Majority Shareholders, upon or to cause the demand Company to merge with or into or consolidate with any non-Affiliate(s) of the Company or any Selling Fortress Entity participating in such Third Party Sale of the Majority Shareholders (in each such entity’s sole discretioncase, the “Buyer”) in a bona fide negotiated transaction (a “Sale”), such Holder the Grantee, including any of his or her successors as contemplated herein, shall sell be obligated to and shall upon the written request of a Majority Shareholders: (a) sell, transfer and deliver, or cause to be sold, transferred and delivered, to the respective Third Party the number of whole Holder’s Buyer, his or her Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on substantially the same terms applicable to the Majority Shareholders (with appropriate adjustments to reflect the conversion of convertible securities, the redemption of redeemable securities and conditions the exercise of exercisable securities as well as the relative preferences and priorities of preferred stock); and (b) execute and deliver such Selling Fortress Entity has agreed instruments of conveyance and transfer and take such other action, including voting such Shares in favor of any Sale proposed by the Majority Shareholders and executing any purchase agreements, merger agreements, indemnity agreements, escrow agreements or related documents, as the Majority Shareholders or the Buyer may reasonably require in order to carry out the terms and provisions of this Section 5. Notwithstanding the foregoing, in connection with any Sale the Grantee shall not be required to make any representations and warranties other than (i) representations and warranties as to the title of his Shares and his power, authority and right to enter into the Sale without contravention of law or contract and (ii) such Third Partyrepresentations and warranties concerning the Company as the Majority Shareholders shall make; provided, however, that each any liability for any breach thereof shall be borne by the Grantee on a pro rata basis based upon the consideration in respect of his Shares received by the Grantee and shall not exceed the amount of such Holder consideration received by the Grantee. Further, notwithstanding the foregoing, Grantee shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make execute any purchase agreements, merger agreements, indemnity agreements, escrow agreements or related documents containing terms applicable to the Grantee that are different in connection with any material respect from the Third Party Sale is a representation terms applicable to the Majority Shareholders (after due adjustment for the relative rights and warranty with respect to such Holder’s own ownership preferences of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder as provided in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to Company’s charter). The obligations under this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not 5 shall terminate in violation of applicable federal and state securities or other laws or, if such Holder is not provided accordance with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawSection 11(b).
Appears in 1 contract
Samples: Restricted Stock Agreement (Monotype Imaging Holdings Inc.)
Drag Along Right. Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect to In the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect event the holders of a Third Party Salemajority of the Company’s equity securities then outstanding (the “Majority Shareholders”) determine to sell or otherwise dispose of all or substantially all of the assets of the Company or all or fifty percent (50%) or more of the capital stock of the Company in each case in a transaction constituting a change in control of the Company, thento any non-Affiliate(s) of the Company or any of the Majority Shareholders, upon or to cause the demand Company to merge with or into or consolidate with any non-Affiliate(s) of the Company or any Selling Fortress Entity participating in such Third Party Sale of the Majority Shareholders (in each such entity’s sole discretioncase, the “Buyer”) in a bona fide negotiated transaction (a “Sale”), such Holder the Optionee, including any Permitted Transferees, shall sell be obligated to and shall upon the written request of the Majority Shareholders (subject to Section 6): (a) sell, transfer and deliver, or cause to be sold, transferred and delivered, to the respective Third Party the number of whole Holder’s Buyer, his or her Issued Shares (rounded upwards including for this purpose all of such Optionee’s or downwards, his or her Permitted Transferee’s Issued Shares that presently or as applicable), whether or not a result of any such transaction may be acquired upon the restrictions on Transfer exercise of Common Stock have lapsed, equal to options (following the product of (x) the total number of Holder’s Shares held by such Holder on the date payment of the Drag-Along Notice (as defined belowexercise price therefor)) and (y) the Third Party Sale Percentage, at the same price and on substantially the same terms applicable to the Majority Shareholders (with appropriate adjustments to reflect the conversion of convertible securities, the redemption of redeemable securities and conditions the exercise of exercisable securities as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that well as the Company may, in its sole discretion, accelerate the vesting relative preferences and priorities of any unvested Holder’s Sharespreferred stock); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (Bb) the liability execute and deliver such instruments of conveyance and transfer and take such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of other action, including voting such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Issued Shares in favor of such any Sale proposed by the Majority Shareholders and executing any purchase agreements, merger agreements, indemnity agreements, escrow agreements or related documents, as the Majority Shareholders or the Buyer may reasonably require in order to carry out the terms and not to exercise any rights provisions of appraisal or dissent afforded this Section 11. The obligations under applicable lawthis Section 11 shall terminate in accordance with Section 14(a).
Appears in 1 contract
Samples: Non Qualified Stock Option Agreement (Lumber Liquidators, Inc.)
Drag Along Right. Notwithstanding any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect 8.2.1 Without prejudice to the maximum number obligation of Holder’s Shares for which such Holder Mold-Tech to purchase Minority Equity Interests under this Agreement, any time after the Share Swap Deadline Date, Mold-Tech and/or its Affiliates shall have the right to Transfer all or part of its Securities to any Purchaser (the “Drag Purchaser”) and if the Drag Price is permitted (not less than the price per Security that the Minority Shareholders and their Permitted Affiliates would receive pursuant to Section 2(b)(ii)(B) abovethe exercise of the Minority Shareholders Put Option or the Call Option, then Mold-Tech shall have the right to require the Minority Shareholders and their respective Permitted Affiliates (each such Shareholder, a “Dragged Shareholder”) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party Drag Purchaser such portion of the Minority Equity Interests that is proportionate to the number of whole Holder’s Shares Securities being Transferred by Mold-Tech or any of its Affiliates (rounded upwards or downwards, as applicable), whether or not the restrictions on case may be) to the Drag Purchaser (“Dragged Securities”) (simultaneous sale/Transfer of Common Stock have lapsed, equal the Dragged Securities and the Dragging Securities to the product of (xDrag Purchaser being the “Drag Sale”) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; manner provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iiiClause 8.2 (Drag Along Right) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or(“Drag Right”). Provided that, if such Holder is not provided with an opinion with respect sale by Mold-Tech and/or its Affiliate results in a Change in Control, Mold-Tech shall have the right to exercise the Drag Right to require the Dragged Shareholders to sell all Minority Equity Interests (calculated on a Fully Diluted Basis) as the Dragged Securities to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is Drag Purchaser in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable law.Drag Sale. SHAREHOLDERS’ AGREEMENT
Appears in 1 contract
Samples: Shareholder Agreement (Standex International Corp/De/)
Drag Along Right. Notwithstanding (a) Prior to a Qualified IPO, (i) So long as Xxxxxxx owns at least 80% of the shares of Common Stock owned by Xxxxxxx as of the date of this Agreement (calculated prior to any other provision hereof, if any Holder has not exercised its Tag-Along Right with respect to the maximum number of Holder’s Shares for which such Holder is permitted (sales pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion4.1(b)), such Holder shall sell if both CCMP and Xxxxxxx propose to Transfer all of their Common Stock, representing more than 50% of the respective Third Party aggregate Voting Securities of the number Company, or (ii) if Xxxxxxx does not own at least 80% of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer shares of Common Stock have lapsed, equal to the product that Xxxxxxx owns as of (x) the total number of Holder’s Shares held by such Holder on the date of this Agreement (calculated prior to any sales pursuant to Section 4.1(b)), if CCMP (so long as CCMP beneficially owns 5% or more of the Company’s Fully-Diluted Common Stock) by itself or along with any other Holders propose to Transfer all of their Common Stock, representing more than 50% of the aggregate Voting Securities of the Company (the “Drag Transaction”), then if requested by the Holder(s) Transferring such Common Stock (the “Drag-Along Seller(s)”), each other Holder (each, a “Dragged Party”) shall (i) be required to sell all of the Common Stock held by it of the same class or series as any of the Common Stock to be Transferred (or then convertible into any such class or series) in the Drag Transaction, and (ii) vote for, consent to, raise no objections to and take all actions reasonably required, necessary or desirable in connection with, such Drag Transaction.
(b) The consideration to be received by a Dragged Party shall be the same form and amount of consideration per share to be received by the Drag-Along Notice (as defined below) Seller(s), and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions of such sale shall be the same as such Selling Fortress Entity has agreed those upon which the Drag-Along Seller(s) sells its Common Stock. In connection with the Drag Transaction, each Dragged Party will agree to with such Third Partymake or agree to the same customary representations, covenants, indemnities and agreements as the Drag-Along Seller(s) so long as they are made severally and not jointly and the liabilities thereunder are borne on a pro rata basis based on the consideration to be received by each Holder; provided, howeverthat (i) any general indemnity given by the Drag-Along Seller(s), that applicable to liabilities not specific to the Drag-Along Seller(s), to the purchaser in connection with such sale shall be apportioned among the Dragged Parties according to the consideration received by each such Holder Dragged Party and shall not exceed such Dragged Party’s net proceeds from the sale, (ii) that any representation relating specifically to a Dragged Party and/or its Common Stock shall be permitted made only by that Dragged Party, and (iii) in no event shall any Holder be obligated to sell agree to any unvested Holder’s Shares non-competition covenant or other similar agreement as a condition of participating in such Transfer.
(c) The fees and expenses incurred in connection with a sale under this Section 4.5 and for the benefit of all Holders (it being understood that costs incurred by or on behalf of a Holder for his, her or its sole benefit will not be considered to be for the benefit of all Holders), to the extent not paid or reimbursed by the Company or the Transferee or acquiring Person, shall be shared by all the Holders on a pro rata basis, based on the consideration received by each Holder in respect of its Common Stock; provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such no Holder shall be required obligated to make in connection with any out-of-pocket expenditure prior to the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership consummation of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale transaction consummated pursuant to this Section 2(b)(iii4.5 (excluding de minimis expenditures).
(d) unless such Holder is The Drag-Along Seller(s) shall provide written notice (the “Drag-Along Notice”) to each other Dragged Party of any proposed Drag Transaction as soon as practicable following its exercise of the rights provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Section 4.5(a). The Drag-Along Notice shall set forth the consideration to be paid by the purchaser for the securities, the identity of the purchaser and the material terms of the Drag Transaction.
(e) If any holders of Common Stock of any class are given an option as to the form and amount of consideration to be received in the Drag Transaction, all holders of Common Stock of such class shall be given the same option.
(f) Upon the consummation of the Drag Transaction and delivery by any Dragged Party of the duly endorsed certificate or certificates representing the Common Stock held by such Dragged Party to be sold together with a stock power duly executed in blank, the acquiring Person shall remit directly to such Holder shall indemnify such Holder Dragged Party, by wire transfer of immediately available funds, the consideration for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawsecurities sold pursuant thereto.
Appears in 1 contract
Drag Along Right. Notwithstanding (a) If any group of Stockholders composed of TCI Sub and any other provision hereof, if two Stockholders (which may include any Holder has not exercised its Tag-Along Right with respect Electing Stockholders) (so long as such Stockholders are Eligible Stockholders and neither of such Stockholders is a member of the same Stockholder Group as the other such Stockholder or as TCI Sub) (a "Dragging Control Block Group") proposes to effect ---------------------------- a Control Block Sale, such Control Block Group shall have the right (the "Drag- ----- Along Right") to require each remaining Stockholder (a "Drag-Along Stockholder") ----------- ---------------------- to sell in such transaction an amount of Company Securities beneficially owned by such Drag-Along Stockholder's Stockholder Group equal to (x) the maximum number of Holder’s Shares for Company Securities proposed to be purchased in the Control Block Sale multiplied by (y) a fraction, the numerator of which shall be the number of Company Securities beneficially owned by such Holder Drag-Along Stockholder's Stockholder Group and the denominator of which shall be the sum of (i) the number of Company Securities beneficially owned by the Dragging Control Block Group plus (ii) the number of Company Securities beneficially owned by the Stockholder Groups of each Drag-Along Stockholder (as defined below), in each case determined prior to such Control Block Sale and determined on an as converted into shares of Series A Common Stock basis (such number of shares which is permitted the product of the immediately preceding clauses (x) and (y), the "Dragged Shares"), subject to the provisions of this Section 4.6. If the -------------- Dragging Control Block Group elects to exercise its right to require the Drag- Along Stockholders to participate in such a Control Block Sale as provided in this Section 4.6, then the Dragging Control Block Group shall provide written notice thereof to each Drag-Along Stockholder (the "Drag-Along Notice"), which ----------------- notice shall include the amount and type of the direct and indirect consideration to be paid to the Dragging Control Block Group (which, to the extent applicable, shall be determined in accordance with the procedures specified in Section 4.6(b)), the form of acquisition agreement the Dragging Control Block Group is prepared to enter into in connection with such Control Block Sale and all other material terms thereof.
(b) If in connection with such Control Block Sale assets, properties or other securities, in addition to the Company Securities (or interest therein) are to be transferred, then prior to submitting a Drag-Along Notice pursuant to this Section 4.6, the Dragging Control Block Group and the other Stockholders shall cause the total consideration specified in the Control Block Sale to be allocated between the Company Securities and such other assets, properties and securities in proportion to their respective fair market values pursuant to Section 2(b)(ii)(B4.7.
(c) above) to exercise such TagEach member of a Drag-Along Right Stockholder's Stockholder Group shall be required to sell (the "Dragged Sale") the Dragged Shares upon the same ------------ terms and conditions as the Dragging Control Block Group has proposed or agreed to sell Company Securities to the purchaser in respect such Control Block Sale.
(d) Subject to the terms of a Third Party Sale, thenthis Agreement, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell delivery to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date it of the Drag-Along Notice (as defined below) Notice, each Drag-Along Stockholder and (y) each member of its Stockholder Group shall agree to become a party to or otherwise become bound by the Third Party Sale Percentage, at the same price and on the same applicable terms and conditions as such Selling Fortress Entity of the contract, agreement or instrument pursuant to which the Dragging Control Block Group has agreed to with such Third Party; providedsell Company Securities in the Control Block Sale, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation which terms and warranty which such Holder conditions shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited no less favorable to the amount members of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice Stockholder's Stockholder Group than the terms and conditions applicable to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawDragging Control Block Group.
Appears in 1 contract
Drag Along Right. Notwithstanding (a) If the Board approves a Sale of the Company (the "APPROVED SALE"), the Stockholders will consent to and raise no objections to the Approved Sale of the Company and (i) if the Approved Sale of the Company is structured as a sale of stock, the Stockholders will agree to sell all of their Common Stock and rights to acquire Common Stock on the terms and conditions approved by the Board, (ii) if the Approved Sale of the Company is structured as a merger, consolidation or other reorganization, the Stockholders will vote in favor thereof (to the extent they are entitled to vote) and will not exercise any dissenters' rights of appraisal they may have under Delaware law, and (iii) if the Approved Sale of the Company is structured as a sale of all or substantially all of the Company's consolidated assets, the Stockholders will vote in favor thereof (to the extent they are entitled to vote). The Stockholders will use their best efforts to cooperate in the Approved Sale of the Company and will take all necessary and desirable actions in connection with the consummation of the Approved Sale of the Company as are reasonably requested by the Board, including, but not limited to, the provision of representations and warranties or indemnifications; provided that the Stockholders shall not be required to incur any out-of-pocket expenses in connection with such Approved Sale of the Company which are not reimbursed by the Company; and provided further that no Stockholder shall be required to provide substantively different representations and warranties or indemnification than any other provision hereof, if any Holder has not exercised its Tag-Along Right Stockholder and that each Stockholder's obligations thereunder shall be several and limited to the proceeds received by such Stockholder in connection with such Approved Sale.
(b) The obligations of the Stockholders with respect to the maximum number Approved Sale of Holder’s Shares for which such Holder is permitted the Company are also subject to the satisfaction of the following conditions: (pursuant to Section 2(b)(ii)(Bi) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand consummation of any Selling Fortress Entity participating in such Third Party the Approved Sale (in of the Company, all of the holders of each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer class of Common Stock have lapsedwill receive the same form and amount of consideration for their Common Stock as all other holders of the same class of Common Stock, equal or if any Stockholders are given an option as to the product form and amount of consideration to be received, all holders of the same class of Common Stock will be given the same option; and (xii) the total number price per share of Holder’s Shares held Common Stock will be payable in cash or publicly traded securities and will be on terms consistent with the rights and preferences set forth in the Company's Certificate of Incorporation as is reasonably determined by such Holder on the date holders of at least a majority of the Drag-Along Notice shares of Class A Common and the Class D common voting as a separate class, the holders of at least a majority of the Class B Common voting as a separate class, and the holders of at least a majority of the shares of Class C Common voting as a separate class, and if such classes cannot agree, by an investment banking firm of national recognition mutually agreeable to such parties, whose determination shall be conclusive.
(as defined belowc) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Party; provided, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that If the Company may, enters into any negotiation or transaction for which Rule 506 (or any similar rule then in its sole discretion, accelerate effect) promulgated by the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation Securities and warranty which such Holder shall Exchange Commission may be required to make in connection with the Third Party Sale is a representation and warranty available with respect to such Holder’s own ownership negotiation or transaction (including a merger, consolidation or other reorganization), the Stockholders will, at the request of the Holder’s Shares Board, and to be sold the extent required to comply with Rule 501, appoint a purchaser representative (as such term is defined in Rule 501) reasonably acceptable to the Board. If any Stockholder appoints the purchaser representative designated by it and its ability to convey title thereto free and clear of liensthe Board, encumbrances and adverse claims and (B) the liability Company will pay the fees of such Holder with respect purchaser representative, but if any Stockholder declines to any representation and warranty made in connection with appoint the Third Party Sale is purchaser representative designated by the several liability of Board, such Holder holder will appoint another purchaser representative (and not joint with any other person) and that such liability is limited reasonably acceptable to the amount Board), and such holder will be responsible for the fees of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel to the effect that the Third Party Sale is not in violation of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawpurchaser representative so appointed.
Appears in 1 contract
Samples: Investor Stockholders Agreement (Allotech International Inc)
Drag Along Right. Notwithstanding (a) Subject to Section 4.7(h), and the prior approval of the Board, any one or more Securityholders (the “Initiating Drag Securityholder”) collectively holding greater than 60% of the Fully Diluted Securities shall have the right to effect, and to cause the Company and each other provision hereofSecurityholder to consent to and participate in, a sale of all of the Company Securities or all or substantially all of the assets of the Company, as the case may be, to any Person, other than a Person that is a Permitted Transferee of any of the Initiating Drag Securityholders, in a single transaction or series of related transactions, whether pursuant to a sale of the Company Securities or an alternate form of transaction at the election of the Initiating Drag Securityholder (whether by a merger transaction, business combination, consolidation or sale of all of the Company Securities or all or substantially all of the assets of the Company) (a “Drag Transaction”), and if requested by the Initiating Drag Securityholder, each other Securityholder (each, a “Selling Securityholder”) shall be required to sell all of its Company Securities (or, if applicable, to take all Necessary Action to support and consummate such alternate form of transaction) in accordance with this Section 4.7.
(b) In connection with a Drag Transaction, all Securityholders shall receive the same type and amount of consideration per share of each class of Company Securities as is received by other Securityholders of such class of Company Securities (and, subject to appropriate adjustments to reflect the exercise price of Warrants in accordance with the Warrant Agreements, shall receive the same type and amount of consideration per share as is received by other Securityholders for Common Stock), whether cash, securities or otherwise (and, subject to clause (y) below, if any Holder has Securityholder is given an option as to the form of consideration to be received in respect of its Company Securities, all other Securityholders shall be given the same option on the same terms), in each case in accordance with the Organizational Documents and the Warrant Agreements, and the terms and conditions of such Drag Transaction shall be the same as those applicable to the Initiating Drag Securityholder; provided, (w) that in no event shall a Selling Securityholder be obligated to accept any form of consideration in connection with any Drag Transaction other than cash or publicly traded Equity Interests that are not exercised subject to restrictions on Transfer as a result of contractual provisions or Applicable Laws, (x) to the extent any Management Securityholder obtains the right to make a debt or equity investment in a purchaser or one of its Tag-Along Right Affiliates in connection with a Drag Transaction (whether directly or through a contribution of Equity Securities of the Company) (a “Rollover Investment”), such Rollover Investment shall not in itself constitute such Management Securityholder receiving different consideration from the other Securityholders, (y) in the event that any Selling Securityholder is not an Accredited Investor, such Selling Securityholder may, in the discretion of the Board, receive, and hereby agrees to accept, in lieu of any consideration in the form of unregistered securities, cash consideration with an equivalent value to such securities as determined by the Board, and (z) the aggregate consideration receivable by all Securityholders shall be allocated among the Securityholders in the manner specified by the Organizational Documents and Warrant Agreements. In connection with the Drag Transaction, each Selling Securityholder shall agree (A) to provide customary representations and warranties regarding its legal status and authority, its ownership of the Company Securities being Transferred (free and clear of liens and encumbrances,), the due execution of the transaction documents and their enforceability, no conflicts with material agreements, law or judgment, order or decree of any governmental authority and customary (several but not joint) indemnities regarding the same, and (B) to participate pro rata based on the consideration to be received by such Selling Securityholder in any customary indemnities with respect to matters other than the maximum number of Holder’s Shares for which such Holder is permitted representations and warranties described in clause (pursuant to Section 2(b)(ii)(BA) above) , it being understood that such participation shall be limited to exercise funding out of the consideration to be received by such TagSelling Securityholder, on a pro rata basis based on the consideration to be received by such Selling Securityholder, any escrow arrangements related thereto and being responsible for such Securityholder’s pro rata share, on an as-Along Right in respect of a Third Party Saleconverted basis, then, upon the demand of any withdrawals therefrom. Notwithstanding anything to the contrary contained herein, in no event shall (I) any Selling Fortress Entity Securityholder (other than a Management Securityholder) be required to agree to any restrictive covenant, including any non-competition covenant, employee non-solicit covenant or other similar agreement restricting the Securityholder from engaging or investing in any business as a condition of participating in such Third Party Sale Transfer, other than confidentiality, (II) any Management Securityholder be required to agree to any restrictive covenant other than reconfirming the terms of any agreement then in effect between such Management Securityholder and the Company, or (III) any Securityholder be required to agree to any indemnification obligations or contribute any amount in excess of the net cash amount received by such Selling Securityholder in any such Drag Transaction.
(c) In connection with any Drag Transaction, each Selling Securityholder shall be required to vote, if such a vote is required by this Agreement, Applicable Law or otherwise, its Voting Stock of the Company in favor of such Drag Transaction at any Securityholders Meeting called to vote on or approve such Drag Transaction or to consent in writing to such Drag Transaction, and the Securityholders and the Company shall take all other Necessary Action to cause, and shall not interfere with, the consummation of such Drag Transaction on the terms and conditions proposed by the Initiating Drag Securityholder, including executing, acknowledging and delivering consents, assignments, waivers and other documents or instruments, furnishing information and copies of documents, and filing applications, reports, returns and other documents or instruments with governmental authorities; provided that in each such entity’s sole discretioncase, a Selling Securityholder shall be provided with reasonable prior notice of, and the opportunity to review (including with its external advisors), any such Holder actions so required by Selling Securityholders to cause the consummation of a Drag Transaction. Without limiting the foregoing, (A) each Securityholder shall vote or cause to be voted all Voting Stock of the Company that such Securityholder holds or with respect to which such Securityholder has the power to direct the voting and which are entitled to vote on such Drag Transaction in favor of such Drag Transaction and shall waive any dissenter’s rights, appraisal rights or similar rights which such Securityholder may have in connection therewith and (B) if the proposed Drag Transaction is structured as or involves a sale or redemption of Company Securities, then each Securityholder shall agree to sell to such Securityholder’s Company Securities being sold in such Drag Transaction on the respective Third Party terms and conditions approved by the number of whole Holder’s Shares (rounded upwards Board or downwardsproposed by the Initiating Drag Securityholder, as applicable, and such Securityholders shall execute all documents reasonably necessary or required to effectuate such Drag Transaction.
(d) Each Selling Securityholder shall cooperate in the Drag Transaction and will take all Necessary Actions in connection with the consummation of the Drag Transaction as are reasonably requested, including, in the event of a Drag Transaction involving the Transfer of Company Securities, delivering the duly endorsed certificate or certificates if any, representing the Company Securities beneficially owned by such Selling Securityholder to be sold or, in the event the Company Securities are held in book entry, such evidence of ownership and Transfer as the transfer agent for the Company Securities may reasonably require in order to effect the Transfer thereof, and a stock power and limited power-of-attorney authorizing the Company to take all Necessary Actions to sell or otherwise dispose of such securities on the terms contemplated by this Section 4.7 in the Drag Transaction. Such power-of-attorney shall be irrevocable and coupled with an interest. In the event that a Selling Securityholder should fail to deliver such certificates and/or documentation, the Company shall cause the books and records of the Company to show that such Company Securities is bound by the provisions of this Section 4.7 and that such Company Securities may be Transferred to the purchaser in such Drag Transaction.
(e) The fees and expenses, other than those payable to any Selling Securityholder or any of their respective Affiliates, incurred in connection with a Drag Transaction under this Section 4.7 and for the benefit of all Selling Securityholders (it being understood that costs incurred by or on behalf of a Selling Securityholder for his, her or its sole benefit, will not be considered to be for the benefit of all Selling Securityholders), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product extent not paid or reimbursed by the Company or the Transferee or acquiring Person, shall be shared by all the Selling Securityholders on a pro rata basis, in proportion to the consideration received by each Selling Securityholder; provided, that no Selling Securityholder shall be obligated to make any out-of-pocket expenditure prior to the consummation of the Drag Transaction consummated pursuant to this Section 4.7 (excluding de minimis expenditures).
(f) The Initiating Drag Securityholder shall provide written notice (the “Drag-Along Notice”) to each Selling Securityholder of any proposed Drag Transaction as soon as practicable; provided, that such Drag-Along Notice shall be provided to each Selling Securityholder no later than twenty (20) Business Days prior to the consummation of the Drag Transaction. The Drag-Along Notice will include the material terms and conditions of the Drag Transaction, including (x) the total number name and address of Holder’s Shares held by such Holder on the date proposed Transferee, (y) the proposed amount and form of consideration and (z) the proposed Transfer date, if known. The Initiating Drag Securityholder will deliver or cause to be delivered to each Selling Securityholder copies of all transaction documents (including any schedules, exhibits and annexes thereto) relating to the Drag Transaction promptly as the same become available. Any Drag Transaction pursuant to this Section 4.7 shall occur within one hundred eighty (180) days after delivery of the Drag-Along Notice to the Selling Securityholder unless agreed in writing to be extended by the Board and the Selling Securityholders; provided that, if such Drag Transaction is subject to regulatory approval and such regulatory approval is required by the binding, definitive agreement entered into to give effect to such transactions, such one hundred eighty (as defined below180)-day period shall be extended until the expiration of ten (10) and (y) Business Days after all such approvals have been received or the Third Party Sale Percentagerelevant transaction document is terminated. If, at the same price and on end of such period, the same Company has not completed the sale or other disposition of the Company Securities in accordance with the terms and conditions as of the proposed Drag Transaction, the Company shall return to each of the Selling Securityholders any certificates or evidences of ownership delivered in accordance with Section 4.7(d) and any limited powers-of-attorney received by the Company, together with any other documents in the possession of the Company executed by the Selling Securityholder in connection with the proposed Drag Transaction, and all the restrictions on Transfer contained in this Agreement with respect to the Company Securities shall again be in effect.
(g) If the Board, in connection with a Drag Transaction, appoints a Securityholders’ representative (the “Securityholders’ Representative”) with respect to matters affecting the Selling Securityholders under the related transaction documentation, such Securityholders’ Representative shall be a third-party firm that provides such transaction services and each Selling Securityholder agrees (A) to consent to (1) the appointment of such Securityholders’ Representative, (2) the establishment of any applicable escrow, expense or similar fund in connection with any indemnification or similar obligations and (3) the payment of such Selling Fortress Entity has agreed Securityholders’ pro rata portion (from the applicable escrow) of any and all reasonable fees and expenses to such Securityholders’ Representative in connection with such Third Party; providedDrag Transaction and its related service as the Securityholders’ Representative and (B) not to assert any claim or commence any suit against the Securityholders’ Representative in connection with its services as the Securityholders’ Representative, howeverabsent fraud, that each such Holder shall not be permitted to sell any unvested Holder’s Shares gross negligence or willful misconduct.
(provided that the Company mayh) The Initiating Drag Securityholder shall, in its sole discretion, accelerate decide whether or not to pursue, consummate, postpone or abandon any proposed Transfer subject to this Section 4.7 and the vesting terms and conditions hereof. No Securityholder or Affiliate of a Securityholder shall have any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonableliability to any other Securityholder or the Company arising from, good faith efforts relating to provide that (A) the only representation and warranty which such Holder shall be required to make or in connection with the Third Party Sale is a representation pursuit, consummation, postponement, abandonment or terms and warranty with respect to such Holder’s own ownership conditions of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant proposed Transfer subject to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel 4.7, except to the effect that extent such Securityholder shall have failed to comply with the Third Party Sale is not in violation provisions of applicable federal and state securities or other laws or, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice to such Holder shall indemnify such Holder for any such violation. If the Third Party Sale is in the form of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawSection 4.7.
Appears in 1 contract
Samples: Securityholders Agreement (Hornbeck Offshore Services Inc /La)
Drag Along Right. Notwithstanding any In the event that the General Partner and the holders of a majority of the voting power of all outstanding capital stock of PubCo entitled to vote thereon approve a Qualified Transaction (the “Approved Qualified Transaction”), each other provision hereofPartner (each, if any Holder has not exercised its Taga “Required Partner”) agrees to Transfer all of such Required Partner’s Units in connection with such Approved Qualified Transaction (the “Drag-Along Right Right”) for an amount of consideration per Unit and corresponding Class B Common Share equal (before taking into account any rights such Required Partner may have under the Tax Receivable Agreement) to the amount of consideration to be received per Class A Common Share by the holders thereof (the “Drag Price”), and otherwise with respect to the maximum number of Holder’s Shares for which such Holder is permitted (pursuant to Section 2(b)(ii)(B) above) to exercise such Tag-Along Right in respect of a Third Party Sale, then, upon the demand of any Selling Fortress Entity participating in such Third Party Sale (in each such entity’s sole discretion), such Holder shall sell to the respective Third Party the number of whole Holder’s Shares (rounded upwards or downwards, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and Units on the same terms and conditions as apply to the Class A Common Shares in such Selling Fortress Entity has agreed to Approved Qualified Transaction, with such Third Party; providedmodifications as are appropriate, however, that each such Holder shall not be permitted to sell any unvested Holder’s Shares (provided that the Company may, as determined in its sole discretion, accelerate the vesting of any unvested Holder’s Shares); provided further that such Selling Fortress Entity shall use its reasonable, good faith efforts by the General Partner, solely to provide reflect the fact that (A) Units and corresponding Class B Common Shares rather than Class A Common Shares will be Transferred in the only representation and warranty which first instance by such Holder shall be required to make Partner. Any Transfer effected in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership Drag-Along Right shall be structured in the sole discretion of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liensGeneral Partner and, encumbrances and adverse claims and (B) the liability of such Holder with respect without limitation to any representation other structure, the General Partner will use its reasonable best efforts expeditiously and warranty made in connection with good faith to take all such actions and do all such things as are necessary or desirable to enable and permit the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated Partners to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided an opinion of counsel Approved Qualified Transaction to the effect same extent or on an economically equivalent basis as the holders of Class A Common Shares without discrimination; provided that, without limiting the generality of this sentence, the General Partner will use its reasonable best efforts expeditiously and in good faith to ensure that the Third Party Sale is not such Partners may participate in violation of applicable federal each such Approved Qualified Transaction without being required to have their Common Units and state securities or other laws Class B Common Shares redeemed (or, if so required, to ensure that any such Holder is not provided with an opinion with respect redemption shall be effective only upon, and shall be conditional upon, the closing of such Approved Qualified Transaction, or, as applicable, to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice extent necessary to such Holder shall indemnify such Holder for any such violation. If exchange the Third Party Sale is in the form number of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawCommon Units being repurchased).
Appears in 1 contract
Drag Along Right. Notwithstanding (a) If one or more parties or Groups of parties signatory hereto propose to Transfer all of their Equity Securities, representing more than 50% of the Voting Securities of the Company, and, for so long as such a Transfer requires any approval hereunder, such Transfer has been so approved, then if the party(s) Transferring such Equity Securities (the “Section 10 Transferring Holder(s)”) exercise their drag-along rights set forth in this Section 10, each other provision hereofparty hereto (in this context, if each, a “Selling Holder”) shall be required to sell all of the Equity Securities held by it of the same type as any of the Equity Securities to be Transferred.
(b) The consideration to be received by a Selling Holder has not exercised shall be the same form and amount of consideration per security to be received by the Section 10 Transferring Holder(s), and the terms and conditions of such sale shall be the same as those upon which the Section 10 Transferring Holder(s) sells its Tag-Along Right Equity Securities. In connection with respect the transaction contemplated by this Section 10 (the “Drag Transaction”), each Selling Holder will agree to make or agree to the maximum number of same customary representations, covenants, indemnities and agreements as the Section 10 Transferring Holder(s) so long as they are made severally and not jointly and the liabilities thereunder are borne on a pro rata basis based on the consideration to be received by each Selling Holder; provided, that (i) any general indemnity given to the purchaser by the Selling Holder(s), applicable to liabilities not specific to the Selling Holder, in connection with such sale shall be apportioned among the to the Selling Holders to the purchaser according to the consideration received by each Selling Holder and shall not exceed such Selling Holder’s Shares net proceeds from the sale, (ii) that any representation relating specifically to a Selling Holder and/or its Equity Securities shall be made only by that Selling Holder, and (iii) in no event shall any Selling Holder be obligated to agree to any non-competition covenant or other similar agreement as a condition of participating in such Transfer.
(c) The fees and expenses incurred in connection with a sale under this Section 10 and for which such the benefit of all Section 10 Transferring Holders and Selling Holders (it being understood that costs incurred by or on behalf of a particular Selling Holder is permitted (pursuant for his, her or its sole benefit will not be considered to be for the benefit of all Selling Holders), to the extent not paid or reimbursed by the Company or the Transferee or acquiring Person, shall be shared by all the Section 2(b)(ii)(B) above) to exercise such Tag-Along Right 10 Transferring Holders on a pro rata basis, based on the consideration received by each Section 10 Transferring Holders in respect of a Third Party Sale, then, upon its Equity Securities.
(d) The Section 10 Transferring Holder(s) shall provide written notice (the demand “Drag Along Notice”) to each other Selling Holders of any proposed Drag Transaction as soon as practicable following its election to exercise the rights provided in Section 10(a). The Drag Along Notice shall set forth the consideration to be paid by the purchaser for the securities, the identity of the purchaser and the material terms of the Drag Transaction.
(e) If any holders of the Equity Securities of any class are given an option as to the form and amount of consideration to be received in the Drag Transaction, all holders of the Equity Securities of such class must be given the same option.
(f) Any Selling Fortress Entity participating in such Third Party Sale Holders whose assets (in each such entity’s sole discretion“Plan Assets”) constitute assets of one or more employee benefit plans and are subject to Part IV of Title I of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), such Holder shall not be obligated to sell to any Person to whom the respective Third Party sale of any Equity Securities would constitute a non-exempt “prohibited transaction” within the number meaning of whole Holder’s Shares (rounded upwards ERISA or downwardsthe Internal Revenue Code of 1986, as applicable), whether or not the restrictions on Transfer of Common Stock have lapsed, equal to the product of (x) the total number of Holder’s Shares held by such Holder on the date of the Drag-Along Notice (as defined below) and (y) the Third Party Sale Percentage, at the same price and on the same terms and conditions as such Selling Fortress Entity has agreed to with such Third Partyamended; provided, however, that each if so requested by the Section 10 Transferring Holder(s): (i) such Selling Holder shall have taken commercially reasonable efforts to (x) structure its sale of Equity Securities so as not be permitted to sell any unvested Holder’s Shares constitute a non-exempt “prohibited transaction” or (provided that y) obtain a ruling from the Company may, in its sole discretion, accelerate U.S. Department of Labor to the vesting of any unvested Holder’s Shares); provided further effect that such sale (as originally proposed or as restructured pursuant to clause (i)(x)) does not constitute a non-exempt “prohibited transaction” and (ii) such Selling Fortress Entity shall use its reasonable, good faith efforts to provide that (A) the only representation and warranty which such Holder shall be required to make in connection with the Third Party Sale is a representation and warranty with respect to such Holder’s own ownership of the Holder’s Shares to be sold by it and its ability to convey title thereto free and clear of liens, encumbrances and adverse claims and (B) the liability of such Holder with respect to any representation and warranty made in connection with the Third Party Sale is the several liability of such Holder (and not joint with any other person) and that such liability is limited to the amount of proceeds actually received by such Holder in the Third Party Sale; provided further, that a Holder shall not be obligated to participate in any Third Party Sale pursuant to this Section 2(b)(iii) unless such Holder is provided have delivered an opinion of counsel (which opinion and counsel are reasonably satisfactory to the Section 10 Transferring Holder(s)) to the effect that such sale (as originally proposed or as restructured pursuant to clause (i)(x)) would constitute a non-exempt “prohibited transaction.”
(g) Upon the Third Party Sale is not consummation of the Drag Transaction and delivery by any Selling Holder of the duly endorsed certificate or certificates representing the Equity Securities held by such Selling Holder to be sold together with a stock power duly executed in violation of applicable federal and state securities or other laws orblank, if such Holder is not provided with an opinion with respect to the matters contemplated by this proviso, each Selling Fortress Entity who has delivered a Drag-Along Notice acquiring Person shall remit directly to such Holder Selling Holder, by wire transfer of immediately available funds, the consideration for the securities sold pursuant thereto.
(h) The provisions of this Section 10 shall indemnify such Holder for any such violation. If expire upon the Third Party Sale is in the form consummation of a merger transaction, each Holder agrees to vote its Holder’s Shares in favor of such merger and not to exercise any rights of appraisal or dissent afforded under applicable lawQualified IPO.
Appears in 1 contract
Samples: Investor Rights Agreement (LabStyle Innovations Corp.)